Thursday, April 30, 2015

Uranium One, America Zip - Clinton Foundation Lawlessness

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Wednesday, April 29, 2015

RIOTS and SEIU - Glenn Gets It

Baltimore. shameful.
Martin Luther King is truly dead. So soon will our country be, I fear.
Where is any leadership? The president is silent and Hillary Clinton was on the campaign trail telling those that would listen this weekend that we "need to change deep seated religious beliefs".
Wow.
Elected leaders haven't lead in quite sometime, but there is good news. I will tell you were the leadership is:
The crips, bloods, Nation Of Islam and SEIU.
Union members how do you feel about your union bussing in "protesters", funding and printing posters etc? Is this what you labor for? Riots?
How do you feel that your union is standing next to the crips, bloods and The Nation of Islam?
Food service workers of SEIU and anyone else in the labor brotherhood, STAND UP AND STOP THIS MADNESS IN SEIU.
WAKE UP UNION MEMBERS OF AMERICA. SEIU IS PLAYING AN ORGANIZING ROLE IN THESE RIOTS.
This is how the 1960's would have ended if Martin Luther King hadn't been who he was. A God fearing, intelligent, peaceful and rational man.
Remember it was Malcolm X that wanted to push for guns and riots. It was king that stopped him. Malcolm X at the time was a leader of the Nation of Islam. When he shortly there after saw the error of his ways, the Nation of Islam had him killed.
I warned of this with these exact players while at fox. I fear this is the beginning of 'The coming insurrection' and the fulfillment of F.f. Pivens hope when she asked 3 years ago, 'where are the riots?' It will get worse. Our police force morale has been weakened and our secret service is out on the town drunk and with hookers.
Here they are and they will only grow. Police officers will be killed and so will protesters. God forbid we repeat the assassinations of the 1960s. We do not weather that storm this time I fear.
This is as sick as those mothers who send their sons out to be martyrs in the Middle East.
The radical left has become an American death cult. Abortions, end of life and now riots. In the end many will die in what will forever stain our nation with disgrace.
Most of the protesters aren't looking for justice as much as free booze, free cvs stuff, shoes or anything else they can take.
Booker T Washington would disown his race if he saw this and I believe Fredrick Douglas would too. What percentage of rioters could even tell me who those two men were with any level of competence?
Rev Martin Luther King would denounce those who claim to be men of the cloth and our founders and Lincoln would reject what is left of the lot who dare call themselves American.
We will all be slaves soon because we are demonstrating to the entire world that we cannot govern ourselves. Lincoln said we would never be destroyed from without, only from with in. He said we would have to choose to commit national suicide. I saw us fashion the noose and put a gun in our mouths tonight.
But we have swallowed sleeping pills long before Baltimore.
We vote for corruption, we laugh at crime, watch snuff 'light' films from Hollywood for entertainment while justifying it by saying our kids know the difference, we teach our children to do as I say not as I do while handing them an attorneys phone number should they ever be offended or not given first place, our marriage rate has plummeted while divorce rates are at the highest levels and yet still beaten by the out of wedlock bastard children rate, which at the same time is being challenged by the number of children we kill through abortions.
And while we are on killing, for 15 years we have destroyed a generation of Americans by sending them off to war ill equipped, armed with foolish PC rules of engagement that get them killed, arm the enemy, release the killers of gitmo back onto the battle field, bring the Muslim brotherhood not only into the Oval Office but into DHS buildings that you or I couldn't get into.
We then make treaties with the psychopathic killers in Iran while they are chanting death to America, we ignore the daily beheadings and crucifixions of CHILDREN by Isis, abandon not only the Christians crying out for help but also the troops when they call for help in Bengazi, then lower the standard of the marines because reciting is down only to turn around and ask them to kill in a war almost no American can explain or justify any more.
Meanwhile at home we not only deny God but we openly mock him. Our pulpits are silent as to not upset their tax exempt status or the tithing revenue. After all if they 'didn't serve people in those nice new churches that the bank owns, who would'?
It's best not to say the hard things. And so Christians, Jews, agnostic and atheists turn a blind eye to lies and double dealing by both parties in Washington, we allow them to actually claim and enforce violations of "class two look a like fire arms" (finger guns) in school which send our children to jail while forcing common core non sense math and testing on the remaining students all so the friends of bill gates or Jeb bush can enrich themselves with $30 per pupil testing. After they are done and graduate with out the ability to reason, read or think we then strap them with an out of control college loan that they have almost no chance to pay off and the only loan that cannot be forgiven in exchange for a meaningless diploma for jobs that don't or soon won't exist.
Slaves. Ignorant. Hateful. Tragic.
And we wonder "what the hell is going on?"
I could go on but our national attention span is about four and a half seconds now. Not kidding. So I will cut to the chase and simply tell you what the hell is going on:
When there is a lack of vision and leadership the people perish.
The press reported the president huddled in private tonight to discuss Baltimore.
What is to discuss?
You say you admire King. Well then maybe you should damn well start acting like him Mr. Obama.
Maybe you should teach and take his oath of non violence. Or do you not agree because the police acted stupidly?
Sick. Sad. What a waste.
We should be running to help those in Napal and the Middle East. Instead we will now see a publicity stunt to try to assist Omalley win over the American queen, Lady Hillary.
In hopes that he could beat the other royal, us, subjects can look forward to watch enrich himself as the Clinton's, bush's and Obamas have.
All the world is but a stage. And we are watching theatre of the highest caliber play out.
"The play? A tragedy called 'man' and it's hero: the conquerer worm."
The actors should know how it ends and never forget that this is a union house and they are not to touch anything with out a member of the local stage hands guild. Just do as you are told and everything will be fine.
It is sundown in America tonight. Are we brave enough, smart enough, humble enough and committed enough to renew her promise so the next generation can greet the morning in America once again?
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Time For Ben Carson : Run Ben Run

Ben Carson will declare his presidential candidacy in Detroit next Monday. Not a minute too soon.
The retired neurosurgeon and conservative star formed a presidential exploratory committee on March 3. Since then, he’s been traveling around the country in what might be called a non-strategic way — making paid speeches that he had longstanding commitments to give, appearing at events for his Carson Scholars Fund (which awards money to promising students around the country) and, in other ways, not directing any particular focus on the key early states of Iowa, New Hampshire, South Carolina and Nevada. . . .
Carson will announce in Detroit. It’s a natural choice, since it is not just Carson’s hometown, but also a good political choice because some conservatives see the city, mired in bankruptcy and general, long-running decline, as a laboratory for new policies that could reverse its fortunes. Carson could direct special attention to the city’s problems.
Carson can also, with a well-done rollout next Monday, bring new attention to his fledgling campaign that would stop his slide in the polls. “It’s safe to say that all of the declared candidates so far have seen pops around their announcement,” notes Murray. “We see a great opportunity as Ben starts to define his message and positions on issues.”
Whatever Carson does, it will stand out from the rest of the field. Calling his approach to the 2016 race “unorthodox” would be an understatement. Carson speeches, even in a political setting, can seem more like TED talks on the values that brought him success in the decidedly non-political field of brain surgery. At the same time, Carson has deflected policy questions by saying he is not yet a candidate and is still studying the issues.
That ends soon.
I see more Ben Carson stickers around Knoxville than for any other candidate, for whatever that’s worth.

Baltimore : A Democrat Enabled DISASTER

THE BLUE-CITY MODEL:  The Wall Street Journal has an excellent editorial today, explaining how the Baltimore riots demonstrate the utter failure of progressivism in urban America:
The men and women in charge have been Democrats, and their governing ideas are “progressive.” This model, with its reliance on government and public unions, has dominated urban America as once-vibrant cities such as Baltimore became shells of their former selves. In 1960 Baltimore was America’s sixth largest city with 940,000 people. It has since shed nearly a third of its population and today isn’t in the top 25.
The dysfunctions of the blue-city model are many, but the main failures are three: high crime, low economic growth and failing public schools that serve primarily as jobs programs for teachers and administrators rather than places of learning.
Exactly.  John Nolte over at Breitbart has a similar take:
Baltimore is not America’s problem or shame. That failed city is solely and completely a Democrat problem. Like many failed cities, Detroit comes to mind, and every city besieged recently by rioting, Democrats and their union pals have had carte blanche to inflict their ideas and policies on Baltimore since 1967, the last time there was a Republican Mayor. . . .
Liberalism and all the toxic government dependence and cronyism and union corruption and failed schools that comes along with it, has run amok in Baltimore for a half-century, and that is Baltimore’s problem. . . .
Poverty has nothing to do with it. This madness and chaos and anarchy is a Democrat-driven culture that starts at the top with a racially-divisive White House heartbreakingly effective at ginning up hate and violence.
Nolte’s right:  The rioting in Ferguson and Baltimore isn’t driven by poverty, race, or even police brutality.  It’s driven by progressive culture, which teaches that successful business people “didn’t build that,” accepts abortion/divorce/children out of wedlock as normal behavior, proclaims that poor children (particularly minorities) cannot succeed, that police and authority in general are the “enemy,” and that law is rigged against minorities.  Urban music, “leaders” like Al Sharpton, and a Democrat strategy of balkanizing Americans through identity politics–echoed daily by mainstream media–has created a culture that has no respect for the rule of law.  In the eyes of progressives, the American Dream is dead, and they are literally dancing on its grave.
Until this progressive culture changes (if it ever can) or is marginalized politically, we will have lawless behavior every time these destructive, sociopathic cultural expectations are reinforced by tragedies like the deaths of Michael Brown or Freddie Gray.

Tuesday, April 28, 2015

Don’t Worry, Be Happy - We,re talking Obama Here

v

Don’t Worry, Be Happy

by Victor Davis Hanson // PJ Media
downloadIn his 1988 presidential race, George H.W. Bush was trashed by the left for selecting the Bobby McFerrin hit “Don’t Worry, Be Happy” as his campaign song. Maybe Bush thought he needed a lighthearted optimistic echo of Reagan’s 1984 mantra, “It’s morning in America.” [1]But the Left thought the ditty confirmed the image of a callous and vacuous Bush who didn’t “worry” enough about the poor and minorities. The liberal McFerrin was outraged that Bush sought to play his own song at rallies. Shortly afterwards, “Don’t Worry, Be Happy” was quietly dropped by the Bush team.
Perhaps no other slogan better characterizes the Obama tenure.
America is relieved that things at least appear calm, as war and death rage abroad. At almost every critical juncture, the administration chose short-term happy talk in lieu of worries over long-term consequences. No matter how frequent the disasters abroad, Obama can proclaim the world is at peace in an unprecedented age of stability and security.
We did not lose a soldier in the bombing of Libya. Only an ambassador and three U.S. personnel were killed in the aftermath. As Hillary Clinton put it: “What difference does it make?” Indeed, of Libya, she also chuckled [2]: “We came; we saw; Khadafy died.”
That Libya is now a terrorist beheading hellhole on the Mediterranean is someone else’s problem at some future date. The bombing of Khadafy may have been the first time in U.S. history that we bombed an autocrat out of power without staying around on the ground to thwart the ensuing and inevitable chaos.
Was that “smart” diplomacy?
Remember “reset”? What happened to it? Did it die in Crimea or Ukraine? For nearly four years, from a plastic reset button to cancelled missile defense with the Czechs and Poles (how prescient that anti-Iranian initiative of George W. Bush now seems in light of the current talks), we were told how Obama and Hillary Clinton had undone the damage that Bush had inflicted on Russian-American relations.
Then, after serial Putin aggression, only silence followed.
There has not been a peep from the administration about the fate of “reset,” much less about the long-term consequences of appeasing Putin for four years. I think the Obama strategy is to keep quiet about the disaster, hope that it takes Putin some time to digest Ukraine, and then leave Putin’s agenda in the Baltic states to the next president.
Why worry about Iran? They promise not to make a bomb for a decade. Translated, that means that Obama (“I don’t bluff”) envisions more laureate accolades for getting out of office ahead of an Iranian nuke, and woe to the president who follows.
Pulling all U.S. peacekeepers out of Iraq at the end of 2011 proved a useful short-term campaign talking point [3]. But the ensuing vacuum birthed the “jayvees” of ISIS, who probably also have a rendezvous with the next president. Why should anyone in Malibu worry about Tikrit or the impending fall of Ramadi, or how a new, low-grade caliphate might remake the Middle East?
Issuing various red lines and deadlines [4] to the Syrians and Iranians sounded tough at the time, but at some future date an American president is going to have to reestablish — at some cost — the authenticity of an ultimatum by the president of the United States.
But for the short term, Americans were collectively relieved that Obama proved a gasbag and did not enforce the threats.
Leading from behind and forcing Gulf monarchies to fend for themselves is attractive to the American people, who are tired of Middle East ingratitude after 9/11 and all the machinations of the Saudi royals. But again, at some point amid the growing chaos an American administration is going to have to assemble partners to hammer out some sort of order other than Iranian hegemonies in Iraq, Lebanon, Syria, and Yemen.
When Iran, empowered by endless negotiating with the U.S., begins squaring off against the Gulf states, who really cares? I think the Obama administration message would be: “That’s oil-hungry Japan’s problem, not ours.” If only Iran were the Tea Party, and the Ayatollah Khamenei a Ted Cruz, and if only the Gulf exported wind and solar power.
Obama certainly has a genius for packaging progressive lead-from-behind escapism and empathy for anti-U.S. revolutionary regimes in such a way as to appeal to war-weary Americans in general and isolationists of all sorts.
As far as Israel goes, who cares? Forget growing rocket brigades in Gaza, no-man’s land in what used to be Syria, or thousands of missiles pointed at it from Lebanon and a soon-to-be-nuclear Iran.
Don’t worry, Netanyahu, be happy.
There once was much Obama talk of an “Asian pivot” — apparently a muscular show of force to Pacific allies who were concerned that American talk of drastic cuts in our nuclear arsenal, and paralysis in the face of Chinese and North Korean aggression, meant they weren’t still inside the defense umbrella of the United States. In two years, those concerns will spike. A future president will have to beef up our Asian defenses, talk tough with the Chinese, and assure our allies that they neither have to go nuclear nor accommodate China.
But for now, who cares? Be happy!
There are lots of valid comparisons made between British Prime Minister Neville Chamberlain (who resigned the day Germany invaded France and the Low Countries) and Barack Obama. But one similarity does not hold. Chamberlain stayed in office too long, and suffered firsthand the consequences of his own appeasement on September 1, 1939. Obama, on the other hand, will probably be long out of office and on the global lecture tour when the wages of his policies come due in the Middle East, Russia, the Pacific, and Latin America.
The world today is stable in the sense that it was in summer of 1914 or in August of 1939 — calm before the dark clouds when any who pointed to the storms on the horizon were ridiculed as alarmist fearmongers. No one was more popular in the West than Neville Chamberlain after Munich.
Unfortunately, they who sow the wind shall reap the whirlwind. But for now, don’t worry, be happy.

The Fall of the House of Clinton

The Fall of the House of Clinton

victorhansonApril 28, 2015 7:54 am

Boys and girls, Count Victor presents a berrry, berrry scarrrrrry tale of political corruption run amok.

by Victor Davis Hanson // PJ Media
via PJ Media
via PJ Media
Hillary Clinton will probably survive her latest ethical disaster. James Carville — of “if you drag a hundred dollar bill through a trailer park, you never know what you’ll find” fame  — is back again to pronounce the Clinton Foundation scandal as “diddly-squat.”   He may be right in the political sense. After all, we know the standard Clinton rescue plan from the past: her aging point-men like Carville, Lanny Davis, and Paul Begala flood the airways, yelling “prove it!” at their television hosts and declaring:

  1. That the accusations are “old news.”
  2. That the accusers are funded by right-wing conspiracists.
  3. That everyone does what the Clintons did.
  4. That the media pick on the Clintons.
  5. That there is no hard evidence (because they have destroyed documents) that would ever lead to a criminal case. And:
  6. That they are moving on, to work on behalf of the folks.
Such obfuscation worked well with Troopergate, Travelgate, Whitewater, the cattle futures scam, Monicagate, the pardons, and Bill’s serial and sometimes coercive sexual conquests. The scorched-earth protocol has already largely dispensed with the “what difference does it make” and “we came, we saw, he died”  Libya/Benghazi scandals. That the ex-president of the United States often flew on a private jet with  registered sex-offender Jeffrey Epstein, known for supplying underage women to his guests, is, as the Clintons say, “old news.” Hillary Clinton’s serial lies about her email accounts and the Clinton Foundation shakedowns will likewise fade — despite the national-security implications of both transgressions for the United States.
So by “Fall of the House of Clinton” I don’t suggest that a special prosecutor will be appointed to indict Hillary and Bill for crimes that would likely make the accusations that were once leveled against Sen. Robert Menendez, Gov. Bob McDonnell, Scooter Libby, Conrad Black or Dinesh D’Souza look like child’s play in comparison.
The Democrat Party’s investment in Hillary Clinton is too substantial for any such reckoning. Liberals have embraced the Cold-War cliché —  “of course, he is a SOB, but he’s our SOB.” Translated to Hillary that means she is a tough political brawler, she’s on their side, and she’s all they got — and therefore anything such an asset does is more or less tolerable in an imperfect world. Democrats expect her to weather this mess. Each time she does so, the next and more egregious scandal becomes more “old news.” The family’s Nietzschean creed is that any scandal that does not kill off their careers makes a Clinton stronger. Despite the dozen or so ethical scandals that will inevitably arise over the next two years, Hillary Clinton will be nominated by the Democrats and has at least a 50/50 chance of being elected president. The Democratic elite will call her survival “fully vetted” and “time tested.”
But all that said, the House of Clinton has utterly collapsed in a moral sense. The very name Clinton is now synonymous with amorality and will be so for the rest of American history. It is not that the Clintons are immoral and thus break existing moral canons and laws; rather they operate completely outside of any moral universe. To them, there is no such thing as moral or immoral, legal or illegal, ethical or unethical, only whether their aim is judged lucrative and the means to obtain it without serious liability. A form, a disclosure, a protocol for a Clinton is not a question of signing it as required or not signing it; rather, for them, such a requirement simply does not exist. Clintons do not erase emails; they destroy the server to ensure erased emails are erased for good.
Simple facts that would embarrass most are utterly irrelevant to the Clintons. How can Hillary trash hedge funds, when her son-in-law runs one (and a dubious one at that)? She has just attacked the privileges of elite hedge funds without telling us that her daughter worked for one and is now reportedly worth $15 million.  Once Hillary Clinton stepped down from the State Department, she immediately rented space in a speculative financial office — so much better to monitor their unethical tax policies?
Who has the money to pay Bill Clinton $500,000 for a 40-minute talk, and why would anyone do so? (Before we blast oligarchs, remember that UCLA, a public university, paid Hillary $300,000  [$165 a second] for chit chat (did she touch on the unfairness of $1 trillion of student loans or the over-compensation of the one-percent?). Hillary came onto the national scene after using her husband’s cronies to steal $100,000 from the cattle futures market after a paltry $1,000 investment. I say steal unapologetically, given that statisticians report than any of us would have had a 31 trillion to 1 chance to replicate Hillary’s investment savvy. Not satisfied by rigging a system that cattlemen and farmers must assume is transparent and honest, Mrs. Clinton — of raise-taxes-for-the-public-good fame — then shorted the government in the reporting of some of her profits and was caught doing it.
How about transparency and honesty? Bill Clinton lied under oath repeatedly during the Monica investigation, to the point of being disbarred and fined. Subpoenaed legal records of Hillary Clinton turned up (too late) mysteriously in the White House. In the latest email scandal, the mystery was not that Hillary set up a stealthy private communication system to facilitate the Clinton scheme of offering foreign zillionaires the opportunity to give money to the family foundation and huge cash speaking fees for Bill, in exchange for likely favorable U.S. government decisions affecting billions of dollars in international trade and commerce — and perhaps the very security of the United States. We expected even that from Hillary Clinton the moment that she assumed office — in the manner that her husband had once pardoned convicted FALN Puerto Rican terrorists  in hopes of winning bloc votes for her New York Senate campaign, in addition to snagging money from convicted felons. That Mrs. Clinton refused to sign disclosure forms and to follow government protocols about donations and correspondence, as she promised she would, was also nothing new. But what was novel was Hillary Clinton’s ability to hold a press conference and lie about every single aspect of her email crimes. Everything she said was untrue: from the nature of smart phones and email accounts, to the email habits of other cabinet officers, to the methods of securing a server, to the mix between public and private communications, to the method of adjudicating her behavior. All were untruths offered without a shred of remorse.
What is the House of Clinton?  It is a large family syndicate predicated on the three facts. One, Bill is a amoral, well-connected ex-president and good old boy schmoozer who enjoys a lifestyle that only ethical misconduct can ensure. Two, a less charismatic Hillary plays good cop to his bad, and for thirty years has been seen by donors as the likely first female president. Three, as flexible liberals, they have no ideological reluctance to snag Wall Street and corporate pay-for-play cash — and they let that be known to the one-percent who in turn feel that the Clintons’ populist verbiage is simply good insurance. The result is that although Bill, Hillary, and Chelsea are not business people, they became multimillionaires precisely because they can offer access and at least the scent of favorable government treatment to billionaires.
All three have become utterly shameless people. Chelsea lectures us on how wealth has had no hold on her — after making $600,000 from NBC to appear a few times on air, and becoming a multimillionaire working for a hedge fund without any demonstrable financial talent. Hillary sermonizes about poor students while charging them a fortune for a half hour of banality. Bill talks about women’s rights as he has serially translated political power into sexual gratification from those younger, poorer, or less influential than himself.
Wall Street and corporate American know there is no deal considered beneath the Clintons. If they will, as reported, wheel and deal off the human tragedy of the Haitian disaster, then they will indeed do anything. If they are willing to defame and destroy women abused by Bill Clinton, they will not only do that, but proclaim themselves feminists. They have created a huge shakedown conglomerate in the Clinton Foundation in Machiavellian fashion: the philanthropy brilliantly masks the cynical tapping of such funds for personal aggrandizement. Quid pro quos go through the foundation to “help” the helpless while providing the family the moral veneer to moonlight and rake in huge fees from foundation donors, who do not give such largess for nothing. Hitting up corporate finaglers for $70 million in tag-along private jet travel would be burdensome; but creating a tax-free “philanthropy” to provide such corporate one-percent travel for the three Clintons (whether to lecture on global warming or the unfair tax policies of the one-percent) is brilliant in the Medieval sense.
The utter moral collapse of the House of Clinton is, of course, a national disgrace.  But the shame is not because the Clintons are what they are — grifters in ties and pantsuits. Rather, the liberal community’s neglect of three decades of their amorality reminds us what progressivism has become: a psychological squaring in which abstract caring allows privileged people to enjoy their material bounty without guilt over where it came from or how it is used.
Hillary Clinton was out of the stump the last few days blasting CEOs, hedge funds, and right-wing political and religious figures who might impinge on abortion on demand. In other words, she was contracting progressive penances and exemptions for her family’s ongoing greed and indulgence — and for all those who so willingly empower her.

Saturday, April 25, 2015

The Rehypothecation Of Gold, And Why It Matters

The Rehypothecation Of Gold, And Why It Matters

Tyler Durden's picture




 
Claiming to own X quantity of gold is one thing, and reporting how many times the gold has been pledged as collateral is another.
 
When correspondent Scott A. Batten offered to write an explanation of the rehypothecation of gold and why it matters, I quickly accepted. Like many others, I have breezed over the word rehypothecation with the basic understanding that it means assets pledged by counterparties (such as the infamous copper stored in Chinese warehouses) are reused as collateral/repledged--in effect, the same assets are pledged as collateral multiple times.
 
But beyond this, I have not had a clear understanding of how the rehypothecation of gold reserves threatens the whole shaky edifice of Infinite Greed, oops, I mean neoliberal capital markets.
Here is Scott's commentary:
When introducing a new concept, it is best to start with the definition of the words to be used. In this case, the discussion of rehypothecation and how it places the world at risk with the fun and games played in the stock market.
 
Rehypothecation:
 
Rehypothecation occurs when your broker, to whom you have hypothecated -- or pledged -- securities as collateral for a margin loan, pledges those same securities to a bank or other lender to secure a loan to cover the firm's exposure to potential margin account losses.
 
When you open a margin account, you typically sign a general account agreement with your broker, in which you authorize your broker to rehypothecate.
 
Now, let’s put this into easy to understand language. Let’s say that you have ten dollars. You take it to the bank to let them “borrow” it, while paying you interest. What you have done, in reality, is given them your money to use as they see fit, while giving you a small percentage of the gains that they will earn. A bank would loan the money to a home buyer or perhaps a small business. At the very least, they can lend all the money in excess of their requirement to hold some cash as reserves--say 10% for ease of math.
 
They now have nine dollars to invest. Their last resort is to offer it to another bank for that bank to “hold”, because that bank doesn’t have enough money to meet its required reserves. Seems simple enough, right?
 
Welcome to the games bankers play to make money. Now that this simple format is in place, let’s move to where the serious dangers lie.
 
Precious Metals:
 
During World War II, many foreign countries feared that their gold reserves, which at the time backed their paper money, might be taken by an enemy and in 1939, the good old USA was a very neutral country, like Switzerland, only there was a much better deterrent than the Alps-- the Atlantic Ocean. So, many countries--England, France, and others--sent us their gold bars to be stored alongside ours in Fort Knox. Later, after the war was over, we convinced them that it was fine to leave it there and in fact, with the Cold War starting other countries joined in, including Germany.
 
Now, what good is a pile of gold sitting in a fort going to do? It costs a lot to protect it, and the US was paying a small sum in interest, while getting a smaller sum back in “protection fees”. So, the Federal Reserve had a wonderful idea, at least in their minds.
 
Since we have this gold, let’s issue paper on that gold as though it was ours, after all it is sitting in Fort Knox, and earn a bit of money on the side. So long as the Cold War lasted, the gold certainly wasn’t going anywhere. Here is where the trouble began. It was pretty small potatoes for a good while, until we went off the gold standard in 1971 during the Nixon Administration. What good is having a precious metal to back fiat currency, when a promise is just as good? Enter the danger zone.
 
Now, the gold in Fort Knox isn’t doing anything. So, what to do? Well, each bar of gold has a unique mark on it to say who owns it. The Cold War is still raging, so no one is going to ask for it back anytime soon. Let’s melt down some of that gold, just a small percentage of it, and sell it off as bullion. Gold is high and the foreign countries won’t ask for it all, so let’s skim a bit here and there. No one will know, and we can make money.
 
Then debts started to accrue, so they got brazen and started melting bars and reselling bars as their own gold, because they don’t want to use their own gold, when German gold is just the same, except for that little mark. Erase the mark and put your own on it and sell it as yours, using your gold as the “backer” in case Germany asks for some of it back.
 
Well, it wasn’t long until greed set in. Those gold bars that were sold to say, China or Japan, were resold to Austria or Iraq. Much like the bundling and reselling of home loans in the 1990’s, soon the German melted gold was in seven different countries with seven different marks, but no German mark upon them remained. This still wasn’t the breaking point though, after all there is still plenty of Gold in Fort Knox to cover what is owed to them.
 
I don’t know who’s idea it was, but it was a bad idea. They decided that they could sell paper promises of gold being held in the vaults. The last number I saw was 140%. Which means that if they have 100 pounds of gold, they can sell paper as though they have 140 pounds of gold. Now, they can also sell that gold outright as well. So, it's possible that they could sell 140 pounds of paper gold and sell a portion of the physical gold. too.
 
Confused yet? Here is where we stand today. No one knows how much gold is really in Fort Knox. We only know what they say is in Fort Knox. The same is likely true for the Federal Reserve and possibly the major banks; after all, if the Fed starts demanding to know what’s in those banks, they might have to show theirs too. So, let’s say that the economy starts to really go south around the world. As you know from the news, Germany asked to see their gold at Fort Knox and were denied, so they asked for their gold back. Smart move on Germany’s part in my mind. Answer from the Fed, we will get it to you sometime in the near future. This wasn’t challenged by Germany.
 
Why? Rehypothecation. Germany knows that they have been doing the same thing with gold that we have. It’s been sold to multiple people at the same time, under the theory that not everyone will want it at the same time, so we can just move it around as needed.
 
This game of musical golden chairs works fine, until the musical economy stops. When countries start to rack up debt and desire to sell their own gold to pay the bill, and they can’t get it, they get nervous. Now, if the economy is going south and the price of gold is heading up because of fear, those people holding paper gold in the form of futures or just deposit promises begin to sell off for profit or out of financial need. So long as it’s a trickle, no problem, but if it becomes a torrent....
 
Remember the 140% rule? Well, what if the Federal Reserve only kept 60% of the 100% that the paper gold was written on? Now there is an 80% shortage. Someone is about to have their musical golden chair pulled out from under them. They will get paid, BUT that payment will come as fiat currency. As the golden parachute deflates, how good is fiat currency? This is why there are so many on the fringe demanding to see the gold reserves and others are saying gold will hit $5,000 an ounce or higher. It is theoretically possible that for each gold promise, that it is backed by 1/5 or less of physical gold. No one knows, because no one can audit the physical gold.
 
China is getting ready to release their gold reserves. That is, they will do like the Fed and say how much they have. We cannot call them on their real reserves, because then they can do the same to us. Now, if all the gold is still in Fort Knox and the Federal Reserve, then the US can call for a real accounting and show ours as well.
 
However, if we don’t and China does, and calls for the US to do the same, then a lot of fear enters the market. There is a reason that people say "never own paper metals." This is that reason. You might get the value of that gold, but it will be in fiat currency and if things are crumbling then fiat promises become flat losses.
Thank you, Scott, for the explanation. It's a funny thing about financial games; whatever the Mainstream Financial Media mocks as conspiracy theories often later turn out to be accurate.
 
I do not claim any expertise in the gold/paper gold markets, but it's clear that claiming to own X quantity of gold is one thing, and reporting how many times the gold has been pledged as collateral is another. In a transparent financial system, the citizens of the U.S. would be invited to tour Fort Knox (in small, secure groups, of course) and count the nation's gold directly. What's the harm in showing off the gold to anyone willing to go through security?
 
Why keep the nation's gold reserves so mysteriously secret? What's the point in being so cagey about it? Maybe rehypothecation isn't the reason for the secrecy; then what is? Fear of precisely what? Isn't gold supposed to be a foolish relic? What's the danger in letting people look at the foolish relic and count the bars and note the serial numbers on the bars? What's the risk in that?
 
I propose turning Fort Knox into a profitable tourist attraction. If gold is just a foolish relic, then charge $50 a person to wander around "our" gold. It's not like anyone can slip a heavy bar into their purse or pocket without being detected. Put it behind bulletproof glass if you want. What's the risk?