Al's Insights – Thu 19 Apr, 2012

Interesting commentary from a listener.

About a month ago Herman Van Rumpuy stated that “we’ve turned a corner” (das Schlimmste ist ueberstanden).  He was referring to the European debt crisis which has since receded to the very back pages of the news papers.  Things aren’t perfect, but much better.  That seems to be the message.  Happy-talk is here again.  If we listen to the mainstream media, we might believe this spin.
But here comes the IMF (IWF) to spoil the party with an incredible statement, which of course, you won’t hear on the Tagesschau or Heute.
“Suddenly, a big shot from the IMF says, ‘There is a problem here, and there may be a breakup of the eurozone.  It could come sooner than you think.’
Say what?
The amazing thing is not what they are saying (the content of the statement is no surprise at all), but that they are saying it out loud.  Of course the Euro is in deep, deep trouble and, with it, the EU experiment, but no one of import is supposed to be saying this.
Nigel Farage, an outspoken member of the EU parliament from GB has given the following interview in response to the IMF statement.
In any case, the financial system, and especially that of the EU seems to be sitting on top of a rumbling volcano that’s just waiting to blow! Add to this the unpredictable scenarios that could unfold if Sarkozy looses in France next month.
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With escalating fears regarding the stability of the eurozone, today King World News interviewed former LBMA commodities broker and trader and current MEP Nigel Farage to get his take on the situation.  Farage had some very interesting comments regarding the Italians moving large quantities of gold to Switzerland, but when KWN asked about the chaos in Europe, Farage stated, “Well, so far, from all of the European officials and from the new IMF branch office in Washington, we’ve had unanimity that there was no prospect, at any stage, of the euro being under threat.”

Nigel Farage continues:

“Suddenly, a big shot from the IMF says, ‘There is a problem here, and there may be a breakup of the eurozone.  It could come sooner than you think.’  I see that as a bit of a crack in the dam.  They’ve always used the argument that the euro was inevitable and it was here to stay, and an individual from the IMF has just completely blown that out of the water.

(The breakup could be disorderly) because there have been no contingency plans.  This is what makes me so angry.  I’ve been saying to Barroso and that little Van Rumpuy character, ‘Come on, let’s have a Plan B.’  Let’s actually get ourselves ready in case it goes the other way.’  The point the IMF official made is that there have been no contingency plans whatsoever….

“Therefore, what is likely, is that, at some point, the markets will just overwhelm and engulf the whole thing, and short-term, that will lead to chaos.  The whole central banking, International Monetary Fund banking system, I mean it just begins to look more and more like the biggest Ponzi scheme we’ve ever seen on earth.

There are going to be some serious banking collapses and the impact of that, on some sovereign states, will be serious.  I’m afraid we’ve gotten to a point where we really can’t stop this now.  We’re beginning to reach a stage where however much false money you create, the problem becomes bigger than the people trying to solve it.  We are very close to that point.

When I talk about the threats and the risk that this thing could finish up in some kind of rebellion, some sort of awful social cataclysm, they (other European politicians) are now very worried indeed.  They will talk to you in private, but in public, nobody dares utter a word.

I think the deterioration, in the last two or three weeks, in the eurozone is very serious indeed.  It’s the bond spreads in Italy and Spain.  It’s the fact that youth unemployment is now over 50% in some of these Mediterranean countries.

It’s riot and disorder on the streets.  And yet a month ago I was here and there was Herman Van Rumpuy telling us, ‘We’ve turned the corner.  Everything is solved.  There are no more problems with the eurozone.’  What a pack of jokers they look like.”

Farage also had this to say about the Italian movement of gold:  “It was interesting to see massive bullion movements last month, out of Italian banks and into Swiss banks.  So, people who have purchased gold for protection and have kept the gold in Italian bank vaults, now their trust in Italian banks is so bad they have physically moved the bullion to Switzerland.  I’m still a believer, buy gold on dips.”
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I don’t know how close we are to this “cataclysm” Farage talks about, or if it will come about at all, but we should be prepared for anything.  Sometimes creaky, decrepit systems manage to stagger along for longer than anyone would have thought possible.  Maybe it will be this way with the EU.  What appears to be certain, however, is that truly fantastic amounts of money will have to be printed to keep this Titanic from sinking.  This is the best-case scenario I can see.

Be well,

Peter



Comments:
  1. On April 19, 2012 at 12:48 pm,
    Irishtony says:

    The audio is available now at King World News….This is the only one with the balls to stand up in the E.U. Parliament, & call these IDIOTS to account. UKIP gets my vote every time……….I call him the British RON PAUL.

    • On April 19, 2012 at 1:02 pm,
      Marc says:

      Big Al, Irish and all,
      Couple this with what Dr. Stephen Leeb is sayin on KWN today and continued KAOS and volatility is as sure as having a guinness at an Irish pub -as opposed to a Coors…blah..phooey…I hate that stuff! Heck, even Dr. Leeb is almost forgoing diversification…I mean he is talking about going “ALL IN” on gold and the junior minors.
      Marc

      • On April 19, 2012 at 1:36 pm,
        Irishtony says:

        MARC……blah..phooey, i hope your not referring to my beloved GUINNESS..haha

        • On April 19, 2012 at 3:31 pm,
          Marc says:

          Heck no – Irish! I am talking about that p___ water american bud and coors!

          • On April 20, 2012 at 5:16 am,
            Jerry O^OTB says:

            Marc…..you must be referring to pabst , the blue ribbon beer….,
            the king of beer , bud, and the rocky mountain high , coors,,,,
            why marc, that is totally un american…..

      • On April 19, 2012 at 6:11 pm,
        Mark Alan says:

        Marc,

        PLEASE don’t take what Stephen Leeb is saying as what he REALLY means. He is a sophisticated investor, has deep pockets, AND HAS A CERTAIN AMOUNT OF CAPITAL RESERVED to take action. When he says “all in”, he does’t mean that he is going to sell everything else and buy gold and gold related stocks. He means that he is going to use what he has allocated to jump in.

        The reason I responded to you is because I have been sucked into making trades and investment decisions all because of some “famous” guru making a claim. I don’t doubt what he believes about gold, but please stay calm and be rational if you are considering making any investment decisions.

        STAY FROSTY

        • On April 19, 2012 at 6:52 pm,
          Marc says:

          Mark A.,
          Thanks man. I know you have my best interests in mind. I really appreciate it! No, I still don’t think it is a good idea to go all in. And you make some excellent points. I am pretty much where you are in my investing scheme. This guy or others won’t force me to do something I am uncomfortable with. Your advice is seen, heard loud and clear – and accepted (taken!)
          All the best,
          Marc “stayin frosty”

  2. On April 19, 2012 at 12:59 pm,
    Steve says:

    Eye? Jesus walked around for 40 days before He ascended to Heaven.Then is when the Holy Spirit was turned free to influence those who followed Him in flesh.And the earth was rocked again by te acts o the Apostles.Would this truth breaking out be any differant?Jus saying!At this time in the world I believe we are still parralelling the same phenomonon.Truth will reighn Of that much I a sure.As I said yesterday.I am planting corn as primary crop in garden this year I may even be able to rig a still to produce diesel fuel for myself.”Be of good courage”When we are least He is most.
    God Bless America Again!Revival will be paramount!
    God Bless us all in our insights!
    Steve

  3. On April 19, 2012 at 1:15 pm,
    Irishtony says:

    There is a parallel between the E.U. union, & the U.S.= United states of America….E.U.= United states of Europe & things they have in common are , GOVERNMENTS that have to much power, & who put their interests , & that of their elitist friends , before the well being of the people they work for. Here in Europe there are countries that are broke, there in the U.S. you have States that are broke ……..& between the two of us we have banks that are broke. But who do these two powers care about…..THE PEOPLE ?…NO……THE BANKS ?…YES.

  4. On April 19, 2012 at 1:18 pm,
    Karen says:

    Great interview with Nigle. Also at KWN is Celente interview. After listening to both there should be no doubt that PMS will protect your wealth.

  5. On April 19, 2012 at 1:33 pm,
    Irishtony says:

    KAREN…With all due respect, we don’t need these people to tell us what we should be doing to protect ourselves all of us here on this site use our common sense & logic, to tell us that the P.M.’s is the only sure fire way to go,…………But it’s nice to have them, confirm it .

  6. On April 19, 2012 at 1:53 pm,
    Dennis M. O'Neil says:

    Nigel in action amongst a den of vipers.

    http://www.youtube.com/watch?v=llDYLb7HoIk

    • On April 19, 2012 at 2:22 pm,
      Irishtony says:

      DENNIS…Thanks for the link, were you watching the faces of the vipers ? They know NIGEL & we the people are on to them, as i say he has ball’s, the rest of them are EUNUCHS.

    • On April 19, 2012 at 3:32 pm,
      Marc says:

      Dennis,
      Absolutely right!

    • On April 19, 2012 at 4:53 pm,
      Jody D says:

      Dennis M,
      Thanks for the link with Nigle. The faces of the others were priceless. Nigle is
      like the boy who shouted “the Emporer has on no clothes!” They all know the truth, but won’t admit it.
      Blessings!
      Jody D

  7. On April 19, 2012 at 1:57 pm,
    Peter says:

    Something else guys. Maybe some input from you on the following.

    I have mentioned B2Gold here on two occasions. Much of their current production in Nicaragua. It is my single largest holding. Today it plunges by 7.53% because Ortega has expressed support for Argentina’s nationalization of that Spanish oil company.

    The market reacted accordingly. However, BTO has a great rapport with Ortega and this man’s support doesn’t mean he is about to nationalize foreign gold companies. Nicaragua has been through too much to not know what these kinds of moves mean to production and hence income. An expression of support does not imply emulation, although one never knows for certain.

    What say you? Is this a speculative buying op, a hold or a sell?

    • On April 19, 2012 at 1:59 pm,
      Peter says:

      Correction, BTO hasn’t been my larges holding in a while, but still significant.

    • On April 19, 2012 at 2:41 pm,
      Dai Uy says:

      Peter:

      I can’t give investment advice however I wouldn’t trust Ortega or his fellow Marxist-Leninist buddy, Hugo Chavez, not to Nationallize; both are working to destabilize Bolivia. Both have track records. Ortega was trained in Cuba and is a puppet of the Castro regime. Check out Daniel Ortega on Wikipedia.

      Res ipsa loquitor……….

      • On April 19, 2012 at 3:06 pm,
        Peter says:

        Thanks.
        Track records they have. But things also change. In any case, the danger of nationalization is never too far from my mind.

    • On April 19, 2012 at 3:34 pm,
      Marc says:

      Goood question! I have Extorre – I am the exactly same predicament! What to do….what to do!
      Marc

      • On April 19, 2012 at 4:57 pm,
        Peter says:

        Mark,
        I’m not going to panic. That’s what I’ll do. Nicaragua’s renaissance is in considerable part due to a revival of the mining industry. Maybe it’s too tempting to resist, I don’t know, but based on this mere declaration of solidarity with a fellow Latin American country in the face of harsh blowback from Europe, I am not ready to conclude that Ortega is now going to do what Chavez has done. After all, he already did that in 1979, and his country didn’t benefit from nationalizing foreign countries. The embargo that followed, didn’t help either.

        This SHOULD blow over. We shall see.

        Best of luck,
        Peter

      • On April 19, 2012 at 5:02 pm,
        Peter says:

        Marc,

        I don’t follow Extorre, but I see that it’s virtually unchanged today.

      • On April 20, 2012 at 6:52 am,
        impeachemall says:

        There was a warning here about Ortega. My take on other crony-socialist systems like Argentina: As long as only the numbers look nice, you may be safe with Extorre. Once the ounces are ready to roll, expect Cristina Kirchner or her successors to take a very intense interest. Of course, the friendly gentlemen running and supporting the company will tell you otherwise. And you know what, they might even turn out to be right.

        The disgruntled expats may just be too traumatized by their long, first-hand experience – Ferfal recently wrote: “I wouldn’t invest a half-eaten BigMac in Argentina, let alone any amount of money.” Make up your own mind.

    • On April 20, 2012 at 8:51 am,
      castanheiro says:

      Hi Peter,
      I’ll offer you and everyone else my opinion on owning foreign mining companies. I enjoy dual citizenship. I am American by nationality/Brazilian by birth location.(Offered for context) With that said, I am very careful about owning companies in other countries. I try to stay as close to home, geographically and politically(US, Canada, Mexico and Brazil), as possible. Governments that are not Democratic, or Representative Republics, or where they are not run by Constitutions that honor and elevate open markets and personal liberties, I try to stay away from. Why? In my opinion, when societal systems implode, gov’ts fall, liberties disappear, and survival becomes paramount, we will see many of these countries who are ruled by Totalitarian regimes, Marxist despots, and Communist ideologues, break ties with foreign countries, especially those whom they see as taking their valuable natural resources. They will take over any wealth producing assets(au/ag mines), food production, lands, communications, transportation systems, etc. They will hunker down in survival mode. There is NO guarantee that any foreign owned companies, nor the shares held in them by outsiders, will be honored. They will be confiscated for that country’s national interests. Many of these countries are currently friendly with the US because it serves their needs and purposes. They benefit from outside money, job and wealth creation, industrial and technological expertise, etc. Once it becomes economically and nationally expedient for them to gain complete control of “Their” resource(when TSHTF), they will! I say all this to say, Please be very careful when investing in foreign countries. We tend to think that because we are Americans, that everybody loves us and wants our culture, our money, our way of life, etc., BUT, it just ain’t so! When challenges arise, that threaten national sovereignty and survivability, they will grab what’s their’s, and boot the Americanos OUT! I’m not saying, “Don’t” invest in other countries, just be very careful, and think things through. I know this was not exactly to your question, but I thought it might be relevant. Forgive me for offering my unsolicited opinion, but this issue concerns me.
      Best

      • On April 20, 2012 at 1:33 pm,
        Peter says:

        Castanheiro,

        Thanks for your observations. Your points are well taken. I basically agree with your assessment.

        The idea is to anticipate the moment before they turn hostile. But I realize you can’t ever be safe from surprises.

        An observant onlooker might have seen the Argentine takeover of the Spanish oil company, because Argentina became a net oil importer last year. There was the motive for what they did.

  8. On April 19, 2012 at 2:58 pm,
    Dennis M. O'Neil says:

    When this monetary mayhem shakes out the people need to know who delivered them into their dire staits. Power needs to be dispersed amongst 2 billion individual economic deceision makers. The planners need to have their plans shelved in favor of the market.
    IRISH another interesting link:

    http://www.youtube.com/watch?v=426xE48MSlM&feature=related

    • On April 19, 2012 at 4:37 pm,
      Irishtony says:

      HI DENNIS..Yes another very good link Thank you , I have watched it before. I would say that the planners need to have their heads removed.

  9. On April 19, 2012 at 2:59 pm,
    shawn says:

    I see a huge Black Swan on the horizon and I think it’s arrival is very soon. It won’t grab headlines in the main street media because most say the government won’t let it happen but now it will devastate all around and there are no safe havens, let me say this in 1982 I had a mortgage that went to 22 3/4%. My house was valued at $38,000 and I owed $30,000. I have no doubt in my mind that we could see these lending numbers return.

    • On April 19, 2012 at 3:18 pm,
      shawn says:

      I also want to add that these same houses in 30 years have gone from $38,000 to $1.2 million a more than 3000% increase while wages have maybe doubled for some but halved for many others. I am sorry to say that This is a recipe for financial armageddon.

  10. On April 19, 2012 at 3:45 pm,
    Dennis M. O'Neil says:

    There is no Volker solution.
    There is too much debt

    • On April 19, 2012 at 5:41 pm,
      Jody D says:

      Perhaps all of you are all ready familiar with this site, but I just happened upon it today. http://www.usdebtclock.org
      Blessings to all of us! We certainly need them!
      Jody D

      • On April 19, 2012 at 9:03 pm,
        John W. Robertson says:

        Thanks for posting Jody. I haven’t been back there since $14.980,000,000,000 or so.

    • On April 19, 2012 at 6:19 pm,
      Mark Alan says:

      That dear Sir, is CORRECT! It is far too late to fix. It is now beyond repair.

      Stay frosty

  11. On April 19, 2012 at 4:15 pm,
    shawn says:

    You’re 100% right the rules could be dictated by Volker and the government in those days now the market will decide and it will be very, very, nasty. Our government is now telling people to get out of debt and their right except they keep taxing in ever increasing amounts and it is an impossible situation for almost everyone.

  12. On April 19, 2012 at 6:11 pm,
    Dennis M. O'Neil says:

    In re Shawn’s Black Swan:

    “If man knew future events completely, he would never act, since no act of his could change the situation.” Murray Rothbard, Man, Economy and State- Chapter 1 Fundamentals of Human Action

  13. On April 19, 2012 at 9:13 pm,
    John W. Robertson says:

    Humans are poor at acknowledging plausible negative outcomes. It’s just doesn’t seem to be in our nature to plan for adversity. But Nigel Farage is promoting what any intelligent planner would insist on…contingencies.

    Farage, you may recall, is the shining star from the UK who made this speech http://www.youtube.com/watch?v=2gm9q8uabTs at an EU meeting in Brussels…many will have seen the clip, but if you haven’t, take the 3 minutes to do so. Actually, It might be worth watching again even if you have seen it for a while. I have to get up and walk around with the adrenaline rush afterwards!

  14. On April 19, 2012 at 9:21 pm,
    John W. Robertson says:

    You can follow all the Farage links on Youtube, but for the sake of those who want to save some time, this one’s even better:

    http://www.youtube.com/watch?v=IkT2YC1gim8&feature=related

    • On April 20, 2012 at 7:59 am,
      clay says:

      Thanks John, I had wondered about a link of all those Farage moments. Yes he certainly is a rising star.

    • On April 20, 2012 at 4:13 pm,
      castanheiro says:

      Amen John! I love Nigel. What a true Patriot and warrior for liberty! Thanks for the links.

  15. On April 19, 2012 at 9:36 pm,
    John W. Robertson says:

    OK, last one, I promise. Unlike the other two above, this video is prescient, and dead-on topic with this thread. Nigel talks about Greece’s demise in early 2009, which was not generally on anyone’s radar yet. The PIIGS acronym had not been invented yet. What he talks about here is just like any of us here talking about Spain right now. The “editorial” on mock gold coins at the end is somewhat telling too.

    http://www.youtube.com/watch?v=5DlVFKBwbuU&feature=related

  16. On April 20, 2012 at 5:59 am,
    Irishtony says:

    JAMES TURK, over at KWN…..Take a look at the chart.

    • On April 20, 2012 at 6:20 am,
      Peter says:

      “We’re making history here. Gold stocks have never been this undervalued before. We’ve had a 12 year bull market in gold, but we’ve also had a 15 year bear market in the mining shares that began with the Bre-X collapse.”

      Optimists will love this set up. Pessimists will be terrified. We are optimists, of course.

      • On April 20, 2012 at 8:30 am,
        impeachemall says:

        The chart looks more than tempting, and James Turk seems to be a very nice guy, but the realist should ask: When was the last time that Turk, in his KWN interviews, timed anything correctly?

      • On April 20, 2012 at 10:22 pm,
        castanheiro says:

        Peter,
        Yes, indeed. I’m with you! Great opportunities!

    • On April 20, 2012 at 6:58 am,
      Mark Alan says:

      And that chart KICKS butt!

      • On April 20, 2012 at 7:35 am,
        Dennis M. says:

        Buy low!

  17. On April 20, 2012 at 6:42 am,
    Steve says:

    Driving my train High on Cocaine Casey Jones is driving te USA-World train.And I hear the pied pipers music behind it too.BUY BUY BUY!

  18. On April 20, 2012 at 6:46 am,
    Dennis M. O'Neil says:

    In the same spirit of Irishtony and James W.’s comments….’you may have seen this before’…if you did it is worth reviewing…..if you have not it is very enlightening.
    Jime Rickards presents to Military Brass a presentation…”Economics & National Security”.
    The reason I include the link here is he uses several videos as context to his presentation one of which is Nigel Farage cutting to the chase.
    The presentation was delivered 28 plus months ago.
    As is often the case with Mr. Rickards he is spot on.
    Interesting is that at the outset (and obviously since we can see it)…he notes his presents are unclassified and invites attendees to request his unclassified version.
    After watching this presentation imagine to yourself….what did he edit from the classified version?

    http://vimeo.com/18160394

    As I look at most of the threads here….this being one of them….I have to say many of them contain more useful information than most of the classes I have endured that purported to do much more.

    • On April 20, 2012 at 4:12 pm,
      castanheiro says:

      Hi Dennis,
      I agree. Saw this presentation some time ago. James Rickard is absolutely brilliant. I always have time to hear what he has to say. I wholeheatedly second your recommendation!

    • On April 21, 2012 at 2:41 pm,
      John W. Robertson says:

      Rickards really shows he knows his stuff in the Q&A afterwards…no pausing, no “Um…”. It would have been nice to see the Classified version. Though in all honestly, I think most of us here can pre-suppose what would be in it.

  19. On May 5, 2012 at 10:18 pm,
    Coeur says:

    Dear Krishnaji,Thank you very much for sending brief news about Ghandruk, it cenriatly has given us pleasure to know what is going on in Ghandruk.I was born and bred in Ghandruk but due to global migration, currently living in the global village in the UK. As such I am always endeavoring to keep myself up to date with the news and views about Ghandruk. The step you have taken is good for those people living abroad. If you would kindly send us such brief notes at least every six months would be great?Thank you so much.Warmest regards