- Money Morning Australia

Popping The “Central Bank Bubble”

Written on 08 December 2010 by Kris Sayce

The Secret Bank Loans saga continues. Your editor has lodged a Freedom of Information (FoI) request with the Reserve Bank of Australia (RBA).

From what we’ve been told, the RBA has thirty days to process our request.

In a nutshell we asked for all internal and external communications from and to the RBA about National Australia Bank [ASX: NAB] and Westpac’s [ASX: WBC] secret loans from the US Federal Reserve.

I’ll keep you posted on what happens next.

In the meantime, to amuse ourselves, we’ve trawled the RBA website to see what the Bank had to say about the health of the Australian banking sector during 2008 and 2009.

The best quote we could find was this from assistant governor Malcolm Edey in March 2009:

“I should stress, by the way, that Australian banks have been much more prudent than their overseas counterparts, and they have remained in sound condition throughout the crisis period.”

Yeah, at that time NAB had just borrowed it’s third amount of USD$1.5 billion from the Fed.

But still, the mainstream press fell for Edey’s claim hook, line and sinker at the time. We now know of course, thanks to the US Federal Reserve that Australia’s banks weren’t in a “sound condition throughout the crisis period” at all.

We know that because NAB and Westpac borrowed over USD$5 billion between them, and the RBA itself borrowed USD$53.5 billion from the Fed which it presumably used to bail out the local banks.

That aside, it seems our email to the Australian Securities Exchange (ASX) got stuck in the Interweb pipes somewhere – oh for a $40 billion national broadband network! – so we gave them a call this morning and have resent the email.

We’ve been told by the ASX, “Our Corporate Relations department acknowledges receipt of your expressions of concerns and will revert to you shortly regarding the progress of your query.”

Blimey, we’d just be happy if they replied. We’re not sure the RBA needs to “revert” to us as they weren’t us to begin with. But never mind. Who are we to comment on grammar? We been known to make the odd mistake.

Anyway, our level of expectation is pretty low. We honestly don’t believe the ASX is going to pull-up either bank on the lack of disclosure. And we can’t imagine the ASX will admit to having known about and suppressed information on the secret loans at the time.

Which would be pretty amazing considering how quick the ASX is to jump on most other companies if there’s even a whiff of non-disclosure.

We’ve even received a couple of emails from ex-CEO’s telling us how the ASX hounded them to disclose information to the market. And we see speeding tickets all the time, especially to small-cap stocks, asking the companies if there’s anything that should be made known to the market.

That two big banks can get off scot-free for not disclosing a USD$5 billion bailout from a foreign central bank would be amazing.

All we know is that it’s time for someone to do some independent forensic accounting on the banks. And seeing as no-one in the mainstream is prepared to do it, it looks like your editor will have to devote some of our spare time to the task – providing it doesn’t take away important research time for Australian Small-Cap Investigator of course.

I’ll keep you posted on how all this goes. In the meantime, what about those markets…

Money Morning reader Marko drew our attention to a lovely bit of mainstream mumbo-jumbo. It was in Glen Mumford’s Market Monitor column in yesterday’s Australian Financial Review (AFR).

We’ll confess to not having read it, but according to Marko, Mumford wrote:

“Sometimes it’s bad news, not good, that turns a market higher. So when I saw the US unemployment rate had unexpectedly jumped to 9.8 percent, I lifted my year-end estimates for the global indices…

“I see this as great ‘bad’ news for investors.”

We’re far from being surprised at the topsy-turvy logic of mainstream commentators. They go from one ridiculous statement to the next.

It’s funny how your editor is labelled a lunatic and nutter for questioning the mainstream view on the housing bubble, on the non-existent housing shortage, and on the fragility of Aussie banks, yet a mainstream commentator gets to write nonsense such as the stuff written by Mr. Mumford and it’s seen as sober economic analysis.

Analysis where good news is great and bad news is… at least good… but sometimes great as well.

It’s this kind of warped thinking that should keep you on high alert with this market. As I’ve said for some time, don’t be suckered into having too big an exposure to the stock market.

Sure, there’s a chance we could see the market rally through the New Year – the Santa Claus rally cliché – but it shouldn’t be banked on. And even if it does happen it won’t guarantee that markets will keep rising.

The past two years are proof of that. The market rallied through the end of the year, but then sunk like a stone afterwards:

Source: CMC Markets Stockbroking

Of course, in 2009 the market did pick up again as it soared over 50% in six months. But one year later from the November 2009 peak and ten months after the last Santa Claus Rally, the market is trading lower. Buy and hold investors who bought in expecting Santa Claus to weave his beardy magic have been sorely disappointed.

But back to Mr. Mumford’s comments. Look, he’s not the only one to take that line. They’re all at it. When there’s good economic news the commentators say that’s good for the market.

And when there’s bad economic news they say that’s also good for the market. But why? How can bad news be good news? And how can it be possible for stock markets to rise in both cases?

It’s simple, the mainstream numpties have lost their minds. They’ve lost all idea about how an economy works and how wealth is created.

They now seriously believe that if an economy can’t grow of its own accord then central bankers can make it grow – by printing money.

That’s what it comes down to. The markets now see any bad news as an excuse for the US Federal Reserve to turn to the printing presses. Because in their mind, more money means more spending and more spending means higher asset prices and greater wealth.

Sure, I’ll admit that part of that argument could be true. That asset prices could see a massive price spurt – in fact we’re playing for that possibility with our Australian Small-Cap Investigator tips. But where we differ from them is our view that they won’t get the outcome they think they’ll get.

There’s no guarantee that it’ll lead to more spending – in fact we hope it doesn’t. And even if it does have an impact on asset and commodity prices, chances are it will only be temporary. And it most certainly won’t result in greater wealth – or not for most people anyway. The bankers and bureaucrats will do fine – as always in a corrupt system – but most everyone else will lose out.

But we’re prepared to take a punt that stock prices will move higher. Although we wouldn’t bet our house on it. And you shouldn’t either. We certainly wouldn’t be over-exposed to the stock market as most mainstream advisers would recommend.

In fact, personally we’ve got less than 20% of our liquid assets in shares. And we’re quite comfortable with that thank-you-very-much… but we’re also ready to dump even that small amount if we think the market is set to head south.

The reason for that is how the stock market is being manipulated right now.

As you know, the US Federal Reserve has a policy of quantitative easing (QE), even though it doesn’t like calling it that.

In simple terms, what the Fed is doing is creating new money by keying in a few numbers into its balance sheet. Once it does that it buys US government bonds on the bond market.

The theory is that this newly created money will be used by investors to buy assets including shares and other commodities. Plus, because the Fed is acting as a guaranteed buyer of government bonds, investors are happy to buy new issues of bonds direct from the US Treasury.

That in turn guarantees that the US government will be able to raise the money it needs to finance its spending programmes.

But what started out as infrequent buying by the Fed has turned into something more frequent. In fact, the Fed is now buying US government bonds every day.

Aside from the Thanksgiving Day holiday and the days either side of it, the Fed has bought US government bonds every day since 12th November.

Since that date the Fed has bought roughly USD$95 billion of US government bonds. Estimates were that the Fed would buy around USD$100 billion per month until next June.

That would be enough to cover the USD$600 billion set aside for QE2, plus extra to continue the so-called reinvestment in government bonds of funds realised from the maturation of residential mortgage-backed securities.

It’s surely no coincidence that since then the market has rallied higher from what our technical analyst, Slipstream Trader Murray Dawes says is a crucial level on the S&P500 index at 1,174:

Source: Google Finance

And that’s the thing. Aside from the Fed creating electronic money from thin air in order to buy government bonds and help prop up the stock market, we see little evidence of any other reason to buy stocks – not unless you’re prepared to take a few high risk and short term swings at the market that is. Although fair play to him, Diggers & Drillers editor Dr. Alex Cowie has played the recent commodity boom like a peach, bagging a number of big winners for his readers.

But I still say it’s not the market to just buy at any old price. And on that score the Stock Doc and I agree.

As I’ve written before, there’s now chatter on the markets about the Fed looking at doing a QE3. In other words, extending the bond buying programme and creating even more new money from thin air.

But at what point does this become old hat for investors. At some point the Fed’s buying will reach a stage where it needs to create ever greater amounts in order for it to achieve the same effect as before. That’s when the buying goes exponential and investors soon realise the game is up and look for the exits… just like with any other bubble.

Of course, the problem – again, as with all bubbles – is knowing when the peak has hit. We’ve picked it for the top of the housing market, but picking the top of the bond and money printing bubble (or maybe we’ll call it a “central bank bubble”) could be a whole lot harder.

The simple message is, if you intend on buying stocks do it with extreme caution. And don’t fall for the idea that both good and bad news is good news for stock prices. Plenty of mainstream investors will find out the hard way when the central bank bubble pops.

For our part we note the Perth Mint now accepts online orders for gold and silver bullion… we know what we’ll be doing as soon as we’ve written our weekly update to Australian Small-Cap Investigator subscribers.


Kris Sayce
For Money Morning Australia

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75 Comments For This Post

  1. michael francis Says:


    Be carefull exposing the lies and corruption within Government and its agencies, its about to become a criminal offence.

  2. meandring40 Says:

    One fresh shot a day, that’s the way to keep this front and centre – but how many shots have you got left Kris? FOI is a heavy duty one anyway. E.g. SMH
    Information revolution opens door to secrets
    Matthew Moore
    October 21, 2010
    Australians will be able to make freedom-of-information requests by email and without charge from next month under changes set to revolutionise the 28-year-old law.

  3. Scott Says:

    Even if you receive information from the RBA, I dare say it will be incomplete. The powers that be have kept this quiet for some time and will want to keep it quiet for longer. Cheers Kris for bringing this out in the open.

  4. david Says:

    i see nab had another glitch today,cb ya buying silver today?

  5. andy dufresne Says:


    A friend who works for them says they’ve been told its been caused by a telco. How and if so, why aren’t they deflecting the blame? I wonder if employers are having any problems depositing payroll commitments? Doesn’t appear so.

  6. digs Says:

    How about getting hold Troy Buswell’s SECRET report on housing
    affordability and land supply

    Careful you dont end up like our old mate from Wikileaks


  7. Ralph Says:

    Touche, Michael Francis!

    Anyone else noticed that there is more and more bubble talk in the mainstream media of late? Even Chris Joye is seeming relatively bearish these days. That probably indicates that the bubble is ripe for the popping.

    Cue more government intervention. What’ll it be? They’ve done well with their reflating efforts thus far, so I’m sure they think they’re absolute geniuses. I reckon they see themselves as unrivalled masters of the economic universe and are backing themselves to keep the world’s last remaining bubble afloat.

    But I reckon the public sentiment is turning. If that’s the case, more cynical bubble blowing may not be enough. After all, Ben is cranking up the printing presses in the US but the masses still don’t want to borrow. That could well happen in Aus too. After all, when you’re already bloated, offering more free food doesn’t seem that appealing (unless you’re like the Monty Python exploding fat man).

  8. cb Says:

    Yes, MF, and it looks like Wikileaks will be used as the justification for the clampdown.

  9. cb Says:

    Interesting discussion of Assange by Jones and Keiser:

    Max Keiser: The Buy Silver Campaign Round 2 – Alex Jones Tv

  10. cb Says:

    Wayne Madsen on Julian Assange arrest
    Smearing the Wiki Messenger

    The arrest of WikiLeaks founder Julian Assange has been making all of the headlines but has all of this attention been a part of a smear campaign against Assange? Many US politicians and media outlets have called for Assange to be labeled a terrorist or even assassinated. Investigative journalist Wayne Madsen says Assange was involved with computer hacking early on and may have been co-opted by the CIA to further the National Security state in cyber space.


  11. Peter Fraser Says:

    Ralph – the bubble has already popped in Qld and WA and is fizzing as we speak – no bang, but plenty of fizz.

    It has begun in NSW ans Vic as well but most can’t see it still.

    It will fizz away for 2 or 3 years.

  12. Peter Fraser Says:

    cb – I don’t know what to make of Assange and his motives, but you can’t seriously think he is a CIA agent –

    If you look for a conspiracy story under every little molehill you will probably find it, but the story will probably be false, made up by someone simply wanting to create a conspiracy story and then laugh about the folk who believe it.

    Do you remember the story about how pyramid shaped structures could do all sorts of wonderful things including sharpen blunt razor blades – well that was a hoax, and the “inventors” of that hoax did indeed laugh loudly at the gullibility of the populace.

    People still to this day believe what was really an April Fools day style joke.

    We could make up our very own conspiracy story here and now, and with a bit of luck it could go viral on the internet if it is plausible. We can even shonk up some photos to prove it.

    Just pick a way out subject – any subject and we will apply our fertile minds to what will be just one of many internet hoax.

    Hence my previous references to David Icke.

  13. cb Says:

    PF – Assange is a dark horse, especially given what the enemies of free speach and freedom of information appear to be planning in response to his activities. There are many unanswered questions about it, so yes, he might well be a CIA/Soros tool. Not everything adds up with the guy, and hence he remains under a cloud, pending further information and developments.

    But there you go again, with your pejorative, belittling insinuation that my doubts about Assange are based on a paranoid search “for a conspiracy story under every little molehill.” Why would you suppose that? Why would you not suppose, instead, that I start out, like everybody else, to search for the truth, and that as a consequence of not everything I see or hear making satisfactory sense, I reserve judgement and entertain doubt before allowing myself certainty of belief.

    Shouldn’t this be the more natural and reasonable way to interpret someone’s searching actions and attitude?

    Anyhow, what happened to the earlier discussion about the “prophecies” you ascribed to some of us here? Are you going to be specific about them, or will you admit the charge that you just made that claim up? I know what you mean by Icke, and it is a distraction.

  14. KP Says:

    I just can’t see the point of shares beyond the IPO. Sure they raise money for the issuing company, as they should, and following investors get a dividend every year, but basically it looks like a pyramid scheme to me with everyone buying shares & just hoping they sell for more. Inexperienced young graduates with business degrees are looking for anywhere to pour in millions of pension scheme money and they buy and sell to each other hoping the next person is a bigger sucker or the inflation they are creating makes the deal look good.

    Every time a Reserve Bank creates a few billion and it ends up in the sharemarket is has done absolutely nothing for the productivity of a country as far as I can see. A typical example of why Govts should not be allowed to create money, as they cannot create wealth.

  15. Peter Fraser Says:

    Oh come on cb – you couldn’t get through a day without a good conspiracy theory.

    You remind me of a close friend who admits that he worries if he doesn’t have anything to worry about. It’s just a habit that you have gotten into.

    David Icke’s conspiracy theories are certainly no more ridiculous that the ones that you have promoted here in the past, but now you seem to have doubts about them.

    So the conspiracy theories have become victims of latter conspiracy theories casting doubt not on the theory, but promoting the alternative theory that they may be part of a larger conspiracy of dis information.

    When is enough ever going to be enough – you think you can sell me the harbour bridge – mate you have already bought them all hook line and sinker.

    When will you ever recognise that????

  16. cb Says:

    PF – You are a sinister pest, a disinformant and spoiler. You are clearly not going to aswer the charge of having made up the “prophecy” claim I put you in the corner about. You keep distracting the conversation. You make stupid accusations and when you are pulled up over them you avoid answering for yourself, as in the current case, and run instead into all forms of distraction and idiotic, baseless generalisations.

    No, of course I could not sell you a scam. You are too clever for that. You are not mad, you are bad. Bad and rotten to the core with your elitist attitudes and allegience to a parasitic class that lives off the productive labour of others. You are full of lies, spin and innuendo. No sooner do you open your mouth and out jumps a piece of spin, half-truth, or outright lie. You have been weighed, PF, and have been found wanting. Wipe the rotten egg off your face and have a good look in the mirror.

  17. cb Says:

    KP – Spot on with all of that. However, if Govt is not allowed to create money, what is the alernative? What should we have as the universal means of exchange? Is it 100% commodity money, such as gold and silver, or something else? I cannot recall what your position is on this question.

  18. Sandra Says:

    PF at 11

    WOW! you sure have changed your tune about the property market!
    Like evolution … only it’s been fast track evolution.

    otherwise known as a backflip

  19. cb Says:

    FFP = Flip Flop Pinocchio.

  20. Sandra Says:

    wow – i see the banks are still propagating the lie that they never received bailout funds during GFC…


    “It [ANZ] reinforced the industry’s mantra that it had not accepted any bailout funds during the crisis.”

    Kris has proved that this is a BLATANT LIE!!

  21. cb Says:

    PF – I noted your response in the earlier thead. It falls short of what I was expecting to see, but will let it be. In light of it, then it appears that your latest spoiling attack is mostly focused on my keeping an open mind about Assange. Why are you so desperate to sell him as a genunine item? Not that I would expect an honest answer from you, but your reaction @ 15 to my rather measured proposition that while most of Assange’s leaks might be genuine, his affiliations might and might not be what what they seem, is sticking out like a sore thumb. Your attack seems almost as desperate as when I make comments or references to zionist miscreants.

    So, let me guess: You will be one of the supporters of censoring and shutting down certain politically oriented internet sites as a way of countering the dangerous and embarrassing activities of people like Assange. And what other sites would you want to censor besides?

  22. J.C. Says:

    I think there is no evidence that ANZ received funding from the Federal Reserve. Technically, the ANZ is right in saying so, but anyone with any interest in this knows that it is diverting the truth away from the fact that they know the implicit guarantee was effectively a bailout. You’ll need to dig deeper to find out if any funds were transferred. If they had, it will be covered up somewhere.

  23. Sandra Says:

    CB – i see silver is selling at a discount today …
    I personally dont have any more cash left to buy with.
    And the banks are so stingy when it comes to overdrafts… but they’re willing to give me tens of thouands in credit on my creditcard – but of course if you use that as an overdraft then they can slam you with fees which are nearly as high as the high interest costs – making the effective interest rates charged more akin to a loan shark.

    lol – u gotta love our Ozzie banks…

    right PF? ;)

  24. Sandra Says:

    JC at 22
    yes, but Westpac and NAB DID receive bailouts…
    so ANZ is lying through their teeth as they are referring to the 4 pillar banks as a whole not being bailed out, which of course is a blatant lie.

  25. Fitch Says:

    cb – A word from a friend, spit that hook out and don’t bite at it again. I can guarantee you a reduction in the risks of repetitive strain.

  26. michael francis Says:



    Monte Pythons exploding fat man. Its that last morsel that gets you everytime. Same as too much debt then taking out that little bit more.

  27. J.C. Says:

    Yes, but ANZ was referring to its own situation. They are being careful with what they say. Even though they know that the mainstream media will be easy with them, they cannot give them enough rope to hang themselves should something be uncovered at a later date. Remember, the mainstream media is simply a tool. There is little real independence.

  28. Sandra Says:

    The thieving barstads are at it again:


  29. dc Says:

    cb @ 9 – Interesting vid, Keiser is lying his a#* off for me, saying that Assange is just your “average freedom fighter” hacking away for our freedom. He also claims that the Soros link is false because none of the leaks support this, which is clearly false as many of the leaks justify US agression towards other countries and it has been pointed out here that Zionist information in many of the leaks has been curiously omitted. If not conclusive, the leaks themselves at least raise a few serious doubts.

    Jones is saying that after listening to dozens of oppinions he thinks that whether Assange is disinfo or not, we should stand behind him.

    Notice how they spin and spin and spin until we are doubting the evidence, while slowly bringing us back on board with the WikiLeaks agenda.

  30. Peter Fraser Says:

    Sandra @ 18 – not at all, if you had been reading my posts you would know that I have been expecting a 5% to 10% reversal since this time last year.

  31. cb Says:

    Thanks, Fitch. Yes, that is good advice. Thanks.

  32. Peter Fraser Says:

    cb @ 21 – honestly I no longer care how you see Assange.

    Sites that I would like to shut down, is that a question like “which 3 people would you most like to have dinner with”?

    Hmmm – well off the top of my head they would be:-
    1. Fox news because they really are attrocious. I don’t necessarily need to see them close down, but a less jingo-istic dumbed down approach would be nice. On the other hand I don’t watch them, so for me they are closed down.

    Actually I can’t think of any other sites that I would like to snuff out, you will have to let me think on that. Maybe some racist sites or ones promoting violence, but again I don’t visit those sites, so I lack experience in that area of the internet.

    Which sites do you want to close down?

  33. Sandra Says:

    I think you will find that people who actually sell their homes have mostly had to drop their prices by more than 10% since the top.
    and its getting worse by the day…

    so you may want to “evolve” your opinion a little further yet

  34. cb Says:

    dc – Yes, it is tricky. Evidence points as you suggest. At the same time, there is a generalised sense in which Jones is probably right: Whatever the reasons and the motivatons for the leaks, keep them coming, and do not prosecute people for these types of leaks.

    Why do I say that? Because a leak is a leak, and it is better to have them being released into the public sphere so that we have something to work with than not being released at all because of the motive behind their release to mislead and disinform. At least with their release, we have a chance of examining it all and use our own God given reason to sort the wheat from the chaff, and the genuine freedom fighters from the agents and instruments of oppression.

    So, while I am a little more suspicious of Keiser now, I am still reserving judgement on what Jones has said, because what he says can be justified on genuine grounds like I suggested, and his motivation may not be because he is working for the dark side. After all, if we now jump at the ruse and say that Assange should be thrown under the bus for not really being the genuine item, we would end up supporting what his controllers want to do in their drive to shut down and censor the internet.

    So, again, No. Whether Assange is his own man or is being owned by the dark side, he should not be prosecuted. These sorts of releases of information should never be prosecuted, but in fact the opposite should be the case: Whistleblowers should be protected as a general rule, regardless of whether they blow the whistle from a genuine concern for the public interest, or for more partisan reasons. Even so, we are right to keep a sharp eye on him. Your thoughts?

  35. cb Says:

    dc – of course, if Assange is in fact a CIA stooge, and knowingly does what he does in order to shut down the itnernet, then he does deserve to end up under the bus for that. Very tricky to splice apart such an interwoven tangled mess, but we must nevertheless try, so that we don’t throw the baby out with the bathwater. You see what I am driving at?

  36. cb Says:

    lol, Sandra, a little more flip flop for Pinocchio?! He might soon end up with his sides bruised. But no matter, he will be easier to recognise for it.

  37. cb Says:

    PF – Okay, you are now on record and we will hold you to that.
    Let’s see what evolves with this Assange story. Let’s see if the powers that be will start introducing legislation that will allow them to start shutting down sites that are politically opposed to them.

    And to answer your question, I would not even presume to know which sort of site or information should be censored and made unavailable to an adult audience, if any. But I see you mentioned racism. On past form, that would mean shutting down sites that are critical of Israel and zionism, such as Brother Nathanael’s site, but it would of course not include sites that vilify moslems as terrorists. But if I am off the mark, this will be as good an opportunity as any to put your considered position on the record.

  38. cb Says:

    dc – About Keiser in particular, what makes me suspicious is his CERTAINTY about Assange being his own man, and not being owned by Soros’s zionist club. He may be his own man, but at this point he is far from justified in having that degree of certainty. Jones clearly has doubts, but not Keiser. That is the difference I see between them. Keiser, of course, is also off the planet with his AGW hysteria, so he is at least half rotten on account of that. His certainty about Assange is just another reason why we must watch him very very closely, indeed.

  39. Peter Fraser Says:

    sandra @ 33 – which area of Australia are you talking about – it does vary from area to area. In some areas prices rose by as much as 24% after I was predicting a flat to small loss, so I think I might have a margin up my sleeve.

    If you read this thread – http://www .talkfinance.net/f32/decipher-cj-7894/
    (slight amendment needed to the www format due to the link being banned here) and note the link at post #7 that will take you to the AFG lending figures which show a definite uptick.

    Also note the comments from the others who really do have some clues in property, and they are all bears, not bulls.

    If you want some good info from time to time also try Cameron Murray’s blog also linked there.

    I used to post info here but the “contrarian” in posters here don’t like actual information, they prefer wacky theories over hard facts.

    Also note the civility of posters on that site compared to those here, quite a difference.

    A couple of posters here have a lot to learn in etiquette.

  40. Peter Fraser Says:

    cb @ 37 – of course it would include sites that are anti muslim and vilify or typecast, or generalise moslems as terrorists.

    To say that anyone is likely to be a terrorist just because they belong to that race or religious group is very wrong IMHO.

    I have never said otherwise.

  41. Peter Fraser Says:

    cb – I don’t flip flop (curious that you use a term popularised by George Bush in his election campaign)

    But you may have flipped.

  42. Nick Says:

    I’m currently in South Africa getting a project started, so I haven’t been following the blog, however, my staff have sent me an email that “Mossad” (as they’ve named PF) has been saying that I predicted “doom” on 7th Dec.

    Here is more evidence that ALL that PF has to say is total garbage and is performing in the true doctrine of a Zionist thug. He also falsely accused me of being a “racist”, he also said he recently spoke to people at Port Arthur about the shooting, Claims that the farmers were at fault for their demise, the Greeks for theirs, the Palestinians for theirs, etc. etc, etc. He also said that gold is a lost cause….watch the next couple of months guys.

    I also had a quick read and noticed many of you are questioning the “technicalities” of what a lump of metal such as gold/silver is worth if you are hungry etc. As I said, I’m in Sth Africa and these people do not need explanations for the merits of gold. This is the difference between people who have experienced firsthand (such as those of Europe in the Depression) and understand fully its merits. I am strapped for time but I will make a quick example. These guys have Zimbabwe as a neighbour and know the reality of fiat vers gold.

    If you need some food, we pampered lot would say a loaf of bread is worth e.g. $5. But if I am hungry and want a loaf of bread desperately, and had an ounce of gold/silver, I couldn’t care less what the “market value” of the metals are, all I know is that it is “true” currency and will be immediately accepted by the vendor as payment for the product I want. I get to eat; he gets payment that he considers “of value”. Now for those of you that are clueless, I can hear you say that no loaf of bread is worth AU$1,400 (+/-)…I say , you haven’t been hungry…yet. They can ban it…but Heroine is also “banned” but it’s more lucrative than BHP. Black market cannot be controlled.

    All those I deal with here have a totally different perspective on “valuing gold” to what we in Australia have. They see the world and determine how it will affect their lives. All we do is say “we’re different here” and go on buying junk on debt and following the deceitful spin of the lowest forms of life. Gold here IS currency.

    Back to PF’s bullshit on what I said about 7th December, this is what I had actually posted :

    “Nick December 2, 2010 at 4:54 pm
    JB..Re 7th December. rule of thumb is, if it is public knowledge it’s just fluff. If an “event” IS to occur , it will be overnight, while we sleep, so to speak. No prior public warning.”

    I joined this blog to expose PF and have seceded, The rest of what he waffles on about is of no interest to me.

    The reason why PF values property so much is as follows:

  43. cb Says:

    You do flip flop, PF. And you are a Pinocchio. You flip flopped on gold, for example, at one point calling it a dangerous, high risk investment, along with pointing out repeatedly when gold was experiencing pullbacks. Then it turned out that you have been accummulating the yellow metal for many years, and not only in the form of jewellery, but also in the form of coins. To Nick’s credit, he put it to it to you several times that you were not being fair dinkum on gold with this audience, until one day you finally admitted as much.

    Ever since then, your position has changed to gold being one of the acceptable forms of investments. You had to concede that much, given that the gold price kept showing you up for the fraud and disinformant that you are.

    Given that experience alone, who knows remains hidden about you? How long is your nose, Pinocchio?

  44. cb Says:

    Good on you, Nick. You dropped in with perfect timing. And, yes, voila, there is one of PF’s BS Pinocchio claims in broad daylight for all to see. Well done, and safe travels.

  45. dc Says:

    cb – Jones definitely looks more legit in this case, but I have my doubts. Then again I’ve heard that agents who are used, are not always aware that they are being used to further a bigger cause, which might mean that Jones has been allowed to keep going because he’s moving in the direction that the estblishment wants, but might not actually know that.

    You said: At the same time, there is a generalised sense in which Jones is probably right: Whatever the reasons and the motivatons for the leaks, keep them coming, and do not prosecute people for these types of leaks.

    I can understand how it would set a precidence for more whistleblowing to take place, but I’m not sure I fully agree. If WikiLeaks has dirt on its hands, couldn’t it potentially be used as mud to sling against legitimate whistleblowers coming out in future?

    Yes Keiser seems to be following a rigid script in terms of his views, rather than exploring them rationally and openly. If he is prepared to make such statements that are so blatently false on air, who knows what is going down with his silver agenda?

    I also wonder about the RT Kremlin connection theory, which is speculative I realise, but I’ll go with it anyway. If Keiser is simply a mouthpiece for Russia, then what does Russia have to gain by promoting AGW, peak oil and possibly inflating the silver price?

    I could understand if Russia has a legitimat desire to crash JP Morgan if they are serious about trading blows with the Zionist bankers, but isn’t AGW a globalist program? How would Russia benefit? How would Russia benefit by promoting peak oil?

    Judging by this piece of news Russia is back with the program. I wonder if they ever really left it?

    Russia’s WTO membership bid backed by the European Union

  46. dc Says:

    I should say he makes blatent assumptions on air, perhaps not proven blatently false yet, but then there is a lot of doubt at this stage.

  47. Peter Fraser Says:

    Nick let me see – you said “he recently spoke to people at Port Arthur about the shooting, Claims that the farmers were at fault for their demise, the Greeks for theirs, the Palestinians for theirs”

    I said I went to Port Arthur after the shootings (many years ago) and spoke to the staff there, and I am correct in that.

    I claimed that the DAIRY farmers caused the downfall of their own industry,an industry in which I was heavily involved prior to and after deregulation, and I am right.

    The greek people are largely to blame for their present position – well who do you blame Nick, is some other nation responsible?

    The Palestinians are largely to blame for their problems – this one is more complex as there are a lot of players involved, and they all share the blame, but still the Palestinians themselves could have done much to help, and they failed to do that, so they do share responsibility.

    Good to hear that you agree with me that bread can be worth more than gold, and I like the way that you have “seceded”

    Anything else Nick?

  48. Peter Fraser Says:

    Nick @42 – for what it is worth I don’t support the Jewish expansion into territories outside Israel, and I have stated that, so enough of the lies mate, when are you going to utter one truth.

  49. Peter Fraser Says:

    cb – Nick has NEVER been right on any of the bile that he has launched in my direction.

    And nor have you.

  50. Peter Fraser Says:

    cb @ 43 – whatever gold I own I would have bought regardless, it was never bought as an investment.

    I hope that you do well out of gold, but I have warned you to be careful.

  51. cb Says:

    Pinocchio should stop picking his nose, or on other people’s spelling mistakes and typos.

  52. Peter Fraser Says:

    cb – and you should stop indulging in untruths.

  53. dc Says:

    cb – Actually when I think about it, Jone’s support for WikiLeaks doesn’t quite wash with me either.

    Admittedly I didn’t write Jone’s full argument in my prior post so I’ll lay it out here more completely.

    Jones referred to the fact that Assange had consentual sex with a couple of women, who because they are feminists, claimed they had been assaulted and pressed charges, or something along those lines… This was the excuse given for his arrest I think and is a whole side-chapter that happend a while back, but the long and short of it is that it was probably just more media theatre.

    Anyway Jone’s statment was that we should support Assange and WikiLeaks, whether or he is guilty or not of being a disinfo agent/puppet, because if we don’t, then we’ll be supporting the femanist agenda and innocent men will not be safe from false accusations made against them by women.

    Do you see the hypocracy with that statement?

    Jones is basically saying that because Assange was a victim of false accusations that resulted due to disgruntled femanists, that we should fully support Assange and the potential Soros agenda that he represents.

    That is we should fully support an organisation that seems likely to play a key role in reducing our freedom of speech on the intenet.

    That an organisation that will be used as a tool to effect more tyrany and control that may well serve to return the human population to the days of fuedalism and slavery should have our full blessings.

    thanks, but no thanks Jones

    ok, you could argue the case that those charges should be dropped but should we really support WikiLeaks as Jones says until those accusations have been confirmed or disproved?

  54. Peter Fraser Says:

    dc – you couldn’t support or not support wikileaks on the basis of a side issue.

    It’s up to you, but the facts in the wikileaks issue have to convince you either one way or the other.

    EG Assange could be quite guilty of rape, but still be the champion that some say he is, OR Vice Versa – OR be innocent of rape AND a champion, but the issues should be separate, they are not co-dependant.

  55. dc Says:

    PF – which is my point, why is Jones mixing them together?

  56. Peter Fraser Says:

    dc – I really don’t know, you will have to make your own mind up on that one.

    But I do see your point.

  57. cb Says:

    DC – There is a lot of noise around, and Jones, like anyone who has too much info and not enough time in which to say it, might have just been jumbling and cramming his ideas without intending to make an argument along those lines. I have been listening to Jones’s shows for a while, although not that much in the last couple of days, and can tell you with certainty that he is not making an argument along those lines. His argument and position would be most accurately described along these ones;

    1. Assange is probably a Soros puppet.
    2. Soros’s game with Assange will probably involve Assange being thrown under the bus at some point, as and when, this will suit his puppet masters.
    3. The overall conspiracy is to censor and shut down freedom of information sharing on the internet, something that Jones has been predicting and denouncing very consistenty, and unconditionally, independently of what Assange is doing or might be doing.
    4. All whistleblowers should be protected and freedom of information and speech should be promoted.
    5. The accusations against Assange sound like some made up charges. They do not sound compelling to Jones.
    6. But however and whatever may be the truth of the matter, Jones would not regard any of the circus to be justification of any sort for censoring and shutting down political opposition on the internet.

    I am pretty sure that I have got all of that right, but I encourage you to listen to Jones’s shows in full and then we share ideas. Listening simply to part of the show, such as those clips with Keiser, where ideas are flying back and forth can be incomplete and hence misleading for getting his take on things. He clarifies his position best in his own rants, inbetween guest interviews. You have to catch him during those times to get a reliable picture.

    He is bound to cover the topic daily. The link again for listening to his repeats is here. Click on Listen Now and the audio will start in a new window.

  58. dc Says:

    cb – you may be right, I might be looking into it too deeply, but it did seem like a subtle misdirection to me. I may be looking for something that’s not there however. whether or not they get back on the WikiLeaks bandwagon again in future will be telling

    actually it also might be worth listening to what Keiser had to say about silver at the start of the interview. Jones referred to an article pointing out a flaw in Keisers campaign and challenged him about it, but then when they finished talking, Jones discounted it as “obviously wrong”, it might be worth watching it and analysing it closer… and it might also be interesting to dig up the actual article that they are talking about too

  59. dc Says:

    cb – also I am not talking about an overt statement, but more a subtle pretext in his actions that achieves the result of sending the message that supporting WikiLeaks is OK and a good thing, regardless of the words that Jones said out loud

  60. cb Says:

    Yes, it should be available on the GATA website. It was, I think, by Bill Murphy. As for Jones wavering while talking to Keiser, it might just have been that he did not have a comeback on the spot to Keiser’s forceful and self-confident argument, so that would not be out of the ordinary. We are all like that a little. It is always two beats later that we work out the perfect comeback to a temporarily confusing moment.

    Anyhow, if Jones is a rat, we are going to flush him out in no time, because I will pick up any changes or softening in his line, as I have a pretty good fix on what he has been saying up to this point, especially since listening to that early interview of his of Cooper. It was from that interview that I worked out that Jones in fact is running the older man’s story and agenda with hardly any deviation from it, so if he starts to deviate, we will know for sure. Did you get a chance to listen through his latest rants? I haven’t as yet. Been rather busy.

  61. cb Says:

    Yes, DC, I am reading you, and that may be right. But as I have tried to indicate earlier, it is a noisy tangled web of considerations, which are not simple to disentangle. I haven’t had the mental space to think through it all and distinguish between the treasonous act that Assange might be guilty of, of facilitating the imposition of internet censorship and that of maintaining and encouraging a culture and environment of whistle blowing and the exposure of scams and insider power plays, conspiracies and dealings.

    So, if you pressed me right now as to what I think should be the right or best response to Assange, if we could be certain that he is a rat, for example, I could not be sure of an answer. I would slam him for his treachery, but not for the act of disclosing information that should be in the public sphere in the first place. You see what I mean? But help me out here. What do you think the best or right response would be? Ban and shut down Wikileaks? If that is what we would opt for, we would be playing right into the hands of the conspirators, as they will gladly do that by introducing legislation that will also shut down all other similar sites. you see the difficulty?

  62. dc Says:

    cb – busy here as well. Yeah it does take a lot of time and energy to analyse information in depth.

    I did dig up the GATA article

    From what I gather the editor thinks that buying physical silver is a fine and noble act, but that it probably won’t crash JP Morgan as Keiser claims it will. I think this might be the relevant part:

    “Yes, exhausting the metal available for delivery could blow up the commodity futures markets, an admirable objective insofar as those markets, overloaded with derivatives, long have been largely mechanisms of price suppression. (See the British economist Peter Warburton’s 2001 essay discerning this: http:// http://www.gata.org/node/8303.)

    But if the metal runs out, the commodity exchanges will change their rules or implement rules already adopted requiring cash settlement and prohibiting new long positions. The government can cover any amount of such settlements in cash through its agents. This sort of thing has been done before and can be done again.

    In short, take the metal out of the banking system — yes, all you can. That will make market manipulation a lot more difficult and drag it into the open. But you won’t crush J.P. Morgan Chase, for the investment bank is the government and the government is the investment bank.”

    I will have a look at the video again when I have time

  63. dc Says:

    cb – busy here as well. Yeah it does take a lot of time and energy to analyse information in depth and it will likely all come out in time

    I did dig up the GATA article

    From what I gather the editor thinks that buying physical silver is a fine and noble act, but that it probably won’t crash JP Morgan as Keiser claims it will. I think this might be the relevant part:

    “Yes, exhausting the metal available for delivery could blow up the commodity futures markets, an admirable objective insofar as those markets, overloaded with derivatives, long have been largely mechanisms of price suppression. (See the British economist Peter Warburton’s 2001 essay discerning this: gata.org/node/8303.)

    But if the metal runs out, the commodity exchanges will change their rules or implement rules already adopted requiring cash settlement and prohibiting new long positions. The government can cover any amount of such settlements in cash through its agents. This sort of thing has been done before and can be done again.

    In short, take the metal out of the banking system — yes, all you can. That will make market manipulation a lot more difficult and drag it into the open. But you won’t crush J.P. Morgan Chase, for the investment bank is the government and the government is the investment bank.”

    I will have a look at the video again when I have time

  64. dc Says:

    As to the best response to Assange, if we could be certain that he is a rat, for example. Yeah it is not a black and white issue.

    In a perfect world I think Assagne/WikiLeaks and Soros should be exposed for what they are, but it is unlikey that the powers that be will allows this to happen, so the likely course of action I suspect will be to attack the act of disclosing information that deserves to be out there, which they will have no qualms about

    ..or they will let him off the hook and the WikiLeaks agenda will continue which might mean that internet freedom is removed, which will probaby lead to whistleblowers being harshly dealt with further down the line anyway as a result of the increased tyrany

    which is better? hard to say

  65. dc Says:

    I watched the video again, but couldn’t find anything obvious in the discussion about silver at the start. I’m not finding anything wrong with Keisers advice to buy silver. It may or may not crash JP Morgan, but it will probably hurt them. I suspect there is something funny going on behind the scenes, but it doesn’t seem like bad advice. What do you think?

  66. cb Says:

    I would tend to concur. Keiser is still suspect, but. His certainty is premature and rash, I think, although he does claim to have access to the journalists who have worked with Assange, etc. Will just have to watch him, but also I will make a point of listening closely to what Jones says about the matter, whether he is changing his tune in the slightest from the path that was laid down by Cooper. I just wish I had more time on my hands, but life just got rather busy for me for the next little while.

  67. cb Says:

    Ah, and yes, about Murphy’s article. He is right. The goal posts have been , and will keep being shifted in mid-game, as and when it suiits the manipulators. But the more manipulative and obvious their game becomes, the more their unfairness is exposed to the day of light. This will keep chipping away and will accellerate the erosion of public trust and respect for their authority and will probably be one of the things that will bring the entire GFC to a head, at which time we have to have our houses in order and be prepared for all contingencies.

  68. Peter Fraser Says:

    This may come as a surprise to many, it did catch me off guard.


  69. dc Says:

    cb -this forum will be a lot quieter if you’re taking a break mate! Sorry to be seeing less of you, but I’m sure there’ll be a few here to hold the fort

    Keiser obviously has a lot riding on campaign personally, if it was an obvious fraud, his reputation would go down like a lead balloon, so he has an incentive to tell the truth. Maybe Keiser was stretching the truth on Alex show? But he might also believe what he says.

    so he claims to have access to the journalists who have worked with Assange, now why would that be I wonder?

  70. dc Says:

    Interesting Pete, I suppose at least they have tightened up on their lending standards

  71. Peter Fraser Says:

    dc @ 69 – well they say that they have tightened, so lets just hope they maintain that.

    Do I know you from another forum?

  72. dc Says:

    No I don’t think so

  73. cb Says:

    Thanks, DC. You guys are doing a sterling job, so I will be the poorer for the absence. I will keep checking in over the weekend and then will be offline for a few days.

  74. cb Says:

    Ocean Shores barber

  75. cb Says:



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