As the editor of the Silver Bear Cafe, I spend most of my time researching current events. I explore the markets, the economic war that is being waged on the middle class, precious metals, the Federal Reserve, energy, and how to go about surviving financially. In this weekly column I will attempt to condense the week's events and examine how the news might affect your pocketbook. JSB

Financial Markets

The world today is on the verge of a cataclysmic shift. In your editor's opinion, it will not be a positive event, but rather one of a heinous nature. It will be the intended result of a conspiracy, led, in part, by David Rockefeller, Sr. The institutional wealth that he, as patriarch of the Rockefeller dynasty, wields, has allowed his megalomaniac plans of world domination to metastasize in to a full blown threat to the freedom and liberty of humanity world wide. The institutional wealth which provides him the platform and opportunity to wield such power and influence is not, in any way, the result of his energies, but rather, those of his grandfather, John D. Rockefeller Sr. The criminal trusts and illegal loopholes that have allowed this wealth to be amassed reflect the flaws in the system and the disintegrating nature of the American Dream. For he who would be king, in a just and regulated society, such notions would be spurned, quashed, neutered and recognized as the wish of an evil clown. We must, as a nation, know who our enemies are. The Fabians, Pilgrims, Bilderbergers, Trilateral Commission, Council on Forign Relations and the Illuminati are all working to assume the status of royalty and rule the world. David Rockefeller, Sr. is a member of all the groups just mentioned and has chaired most of them.

The world is crumbling down around us. And not only economically. We have allowed the orchestrated demise of the world as we know it by a group of misguided, irresponsible power mongers.

Why are these guys bad? Why do I often refer to these banksters as "the Dark Side?" Is it simply due to the fact that they are driven solely by a lust for power? While lust, avarice and greed are indeed Basic Biblical Sins, many people lacking moral stamina fall prey to the various turpitudes of modern society. While failure to resist the temptations of the Basic Sins is a mark of diminished character, it is, in itself, not all-damning.

No, it is because of their lack of cohesive vision. They have attempted to install themselves as the sole shot callers, attempting to rule the world, with no other qualifications other than their membership in the various "lucky sperm clubs." The passed down institutional wealth that they have amassed, through generations of corruption and successful financial manipulation, has skewed their sensibilities. The ideals that may have seemed noble to their grandfathers have been set aside. Their sole motive for world domination has digressed to one of the lowest common denominator. Absolute greed, like absolute power, corrupts absolutely. With no benevolent vision for the future, they have systematically decimated the planet's resources. The resulting imbalance is one that can now only be righted by the severe suffering of all of humanity, including themselves. They are maniacs who have painted humanity in to a corner that is, for all intents and purposes, inescapable.

Know thine enemy.

From Matt Taibbi:

Conspiracy theorists of the world, believers in the hidden hands of the Rothschilds and the Masons and the Illuminati, we skeptics owe you an apology. You were right. The players may be a little different, but your basic premise is correct: The world is a rigged game. We found this out in recent months, when a series of related corruption stories spilled out of the financial sector, suggesting the world's largest banks may be fixing the prices of, well, just about everything.

You may have heard of the Libor scandal, in which at least three – and perhaps as many as 16 – of the name-brand too-big-to-fail banks have been manipulating global interest rates, in the process messing around with the prices of upward of $500 trillion (that's trillion, with a "t") worth of financial instruments. When that sprawling con burst into public view last year, it was easily the biggest financial scandal in history – MIT professor Andrew Lo even said it "dwarfs by orders of magnitude any financial scam in the history of markets."

That was bad enough, but now Libor may have a twin brother. Word has leaked out that the London-based firm ICAP, the world's largest broker of interest-rate swaps, is being investigated by American authorities for behavior that sounds eerily reminiscent of the Libor mess. Regulators are looking into whether or not a small group of brokers at ICAP may have worked with up to 15 of the world's largest banks to manipulate ISDAfix, a benchmark number used around the world to calculate the prices of interest-rate swaps.

Interest-rate swaps are a tool used by big cities, major corporations and sovereign governments to manage their debt, and the scale of their use is almost unimaginably massive. It's about a $379 trillion market, meaning that any manipulation would affect a pile of assets about 100 times the size of the United States federal budget.

It should surprise no one that among the players implicated in this scheme to fix the prices of interest-rate swaps are the same megabanks – including Barclays, UBS, Bank of America, JPMorgan Chase and the Royal Bank of Scotland – that serve on the Libor panel that sets global interest rates. In fact, in recent years many of these banks have already paid multimillion-dollar settlements for anti-competitive manipulation of one form or another (in addition to Libor, some were caught up in an anti-competitive scheme, detailed in Rolling Stone last year, to rig municipal-debt service auctions). Though the jumble of financial acronyms sounds like gibberish to the layperson, the fact that there may now be price-fixing scandals involving both Libor and ISDAfix suggests a single, giant mushrooming conspiracy of collusion and price-fixing hovering under the ostensibly competitive veneer of Wall Street culture.

On the Economic War Front

I have a stock broker friend who was, apparently, schooled to view the world as one big trade. Each trade had two sides. The buyer, and the seller. But he also tends to think of each trade as being made up of a winner, and a loser.

There is something strangely human about the concept of winners and losers. In the food chain there are predators and prey, but only among humans are there winners and losers. When we eat an ear of corn, we do not consider the corn to be a loser. When we have a nice juicy steak, we do not consider the cow to be a loser, (I realize that there are some among us that do, but I believe that they are confused). Anyway, my broker friend believes that in order for him to win, someone must lose. If he is correct, then my utopian dream of a win win situation could be just that, a dream.

In numerous essays that I have penned, I have identified those forces concerned with predatory economics, financial terrorism, and world domination, as "the Dark Side". My continuing research has not only more clearly defined their motives, but has more clearly defined their methods as well.

In the last week, there have been numerous essays, articles and missives posted that finger banksters, politicians, regulators, law enforcement, academia, and many others of being participants in a conspiracy which harbors a collective agenda to instill a sense of terror in us and, in the mean time, steal us all blind!

From James Howard Kunstler:

If the FBI can track down two homicidal Chechen nobodies inside of forty-eight hours of their Boston bombing caper, you kind of wonder how come the Bureau can't detect the odor of racketeering, insider trading, and wire fraud in this month's orchestrated smackdown of the gold futures markets, including the parts played by the Federal reserve, one or more too-big-to-fail banks, self-interested big money players such as George Soros, slumbering regulators at the Commodities Futures Trading Commission, and tractable editors at The Wall Street Journal and The New York Times. 

Of course, US Attorney General Eric Holder, who oversees the FBI, has done a fair imitation of a Brooks Brothers store window mannequin for four years, but surely somewhere in the trackless labyrinth of American law enforcement there exists some dogged rogue investigator with a filament of nagging curiosity who might piece together the clunky train of events that may amount to the financial crime of the century.

For instance, it can't be so difficult to determine who was behind the several hundred ton mass dump of paper gold contracts a week or so ago. There must be a pretty simple record of the transaction, retrievable with a warrant or a subpoena. Whatever entity did it -- still ostensibly unknown -- knowingly generated losses in the neighborhood of a billion dollars for itself.

Was this just the cost of doing business? Or a favor owed, say, from a bank to its godfathers at the Fed, carried out to make the dollar look relatively a lot less unsound than it really is? Or a ruse to allow the custodians of bullion in US depositories re-acquire at bargain prices gold that has been stealthily hypothicated into oblivion? Or just to divert attention from their inability to make good on contracted deliveries of actual physical gold.

Precious Metals

Most Americans are not concerned with gold or silver or ammunition, which is regrettable. If, as I suspect, the day comes when the banksters do attempt steal our retirement accounts, we will be well served to have, in our posession, some of each of the afore mentioned commodities.

From Michael Snyder:

All over the United States we are witnessing unprecedented shortages of ammunition, physical gold and physical silver. Recent events have helped fuel a "buying frenzy" that threatens to spiral out of control. Gun shops all over the nation are reporting that they have never seen it this bad, and in many cases any ammo that they are able to get is being sold even before it hits the shelves.

The ammo shortage has already become so severe that police departments all over America are saying that they are being told that it is going to take six months to a year to get their orders. In fact, many police departments have begun to trade and barter with one another to get the ammo that they need. Meanwhile, the takedown of paper gold and paper silver has unleashed an avalanche of "panic buying" of physical gold and physical silver all over the planet. In the United States, some dealers are charging premiums of more than 25 percent over the spot price for gold and silver and they are getting it. People are paying these prices even though they are being told that delivery will not happen for a month or two in many cases.

Some dealers are feverishly taking as many orders as they can, and they are just hoping that they will be able to get the physical gold and silver to eventually fill those orders. Personally, I have never seen anything like this. If things are this tight now, what is going to happen when the next major financial crisis strikes and people really begin to panic?

Energy

In 1998, the World Bank refused to guarantee a $25 million loan to refinance water services in Cochabamba, Bolivia, unless the government sold the public water system to the private sector and passed the costs on to consumers. Bolivia, one of the poorest countries in the world, finally acquiesced. Only one bid was considered, and the company was turned over to Aguas del Tunari, a subsidiary of a conglomerate led by Bechtel, the giant San Francisco engineering and construction company.

In December 1999, before making any infrastructure investments, the private water company, Aguas del Tunari, announced the doubling of water prices. For most Bolivians, this meant that water would now cost more than food; for those on minimum wage or unemployed, water bills suddenly accounted for close to half their monthly budgets, and for many, water was shut off completely.

To add to the problem, the Bolivian government, prompted by the World Bank, granted absolute monopolies to private water concessionaires, announced its support for full-cost water pricing, pegged the cost of water to the American dollar and declared that none of the World Bank loan could be used to subsidize water services for the poor. All water, even from community wells, required permits to access, and even peasants and small farmers had to buy permits to gather rainwater on their property.

The selling-off of public enterprises such as transportation, electrical utilities and education to foreign corporations has been a heated economic debate in Bolivia. But this was different; polls showed that 90 percent of the public wanted Bechtel out. Debate turned to protest and one of the world's first "water wars" was launched.

The people of Bolivia revolted against the government over the privatization of water. A broad-based movement of workers, peasants, farmers and others created the Coalition in Defense of Water and Life to "de-privatize" the local water system. Between January and early February, 2000, hundreds of thousands of Bolivians marched to Cochabamba in a showdown with the government, and a general strike and transportation stoppage brought the city to a standstill. Police reacted with violence and arrests and the army killed six people and injured more than 100 when it opened fire on demonstrators. In early April 2000, the government declared martial law.

Could this happen here? Is it possible that you could someday be charged for collecting rainwater off your roof? You would be surprised at how many trans-national companies already have stakes in water delivery in this country.

From Lance Devon:

Gun control may be a hot topic, but what about water control? Recent comments from Nestle CEO Peter Brabeck imply that the world's water will soon come under the control of corporations like his. Brabeck makes the astonishing claim that water is not a human right, but should be managed by business people and governing bodies. He wants water controlled, privatized, and delegated in a way that sustains the planet.

All of this means that Brabeck's future plans include monitoring and controlling the amount of water people use. One day, cities and towns may be forced by international law to limit each household to a set amount of water. People may have to obtain permits to dig wells or pay fines for collecting rainwater. Laws like these are already in motion in the United States.

In the interview, Brabeck touts that his company is the largest foodstuff corporation in the world with over $65 billion in profit each year. He proudly claims that millions of people are dependent on him and his company. Does this guy think he is a god?

He calls water a "foodstuff" that needs an assigned value. Who controls the price of water? Brabeck bases his sustainability projects on the fact that a third of the world's population may face water shortages within 15-20 years. By price controlling water, Brabeck believes he may save the planet from food and water shortages in the coming years.

With the threat of future water shortages, is it necessary to strip all humans of their natural liberty to water, as Brabeck suggests?

What might happen if international controls are placed on water sources as a select few corporate dictators rule over the water supply?

Can a free and thriving people find better ways to conserve and respect water with their own liberty, rather than allow global corporations to control it?

Putting a person like Brabeck in control of water would create a tyrannical monopoly on something that was meant to be free. If influential corporations put a lock on the water tap, then they could dictate which farms received water. Nestle could protect GMO farming. In fact, in the interview, Brabeck said organic food is "not the best" and he went on to say that genetically modified food is perfectly safe and causes no disease. With this philosophy, a Brabeck economy would cut off organic farming from the water supply and allow genetically modified food to reign over the people.

The Fed

I receive thirty or forty emails daily from readers. Most are complimentary. Some, from the terminally brain dead, are (understandably) downright rude. But a lot have to do with my apparent obsession with the Federal Reserve (we dedicate a whole forum to it). After having been directed to the following post, by a reader, I felt compelled to, once again, shed some more light on the subject (the Dark side is made up of vampires, and they don't like the light). The Fed is America's central bank. Every country has its own. The following missive exhibits how the the vile and heinous thieves, otherwise known as central bankers have already accomplished the transferring the wealth of their middle classes to the richest one percent of their populations. This is because the richest one percent of the population is, in part, made up of the owners of the Federal Reserve. It has always been the primary purpose of the Fed. At this point I will try and illustrate how they are doing it.

I like to use the the the comparison of the sun going down to the rise in the value of precious metals. Neither has ever happened. If you think either has ever happened, you are confused. The sun doesn't go down, the horizon moves up. The value of precious metals does not go up, the value of the dollar goes down. Prior to 1964, American coined dollars, halves, quarters and dimes were ninety percent silver. In 1963 you could buy a gallon of gas with a 1963 quarter. Today you can buy two gallons of gas with a 1963 quarter. The American Government was bribed into taking the precious metal out of the coinage in order to allow the Fed to more easily steal your wealth through the erosion of your buying power (inflation). If it wasn't for the Federal Reserve, the price of everything would continually go down, instead of up. The standard of life, for everyone, would get better, not worse. If the Dark Side hadn't debased the value of the coinage, a person working for $5.00 an hour would have the purchasing power of what amounts to $120.00 an hour today...twenty silver quarters = $5.00. Let's say a silver quarter is worth $6.00 today. If you worked eight hours a day, five days a week, fifty-two weeks a year, for $5.00 an hour, you would be making $9600.00 before taxes. But consider how much less you would be paying in taxes if you only made $9600.00 per year. Meanwhile, your income would have the purchasing power of almost a quarter of a million dollars ($249,600.00). We (the middle class) would be much better off, and all these stupid wars and stupid bailouts and parasitic thieves would not be possible. I struggle with trying to figure out why we, as a Nation, have allowed this to happen here. Is it because the bulk of the population has been (intentionally) reduced to a bunch of apathetic sheeple? I am obsessed with the Federal Reserve because they are the root of all evil in this country. We must strike the root.

From Aubie Baltin:

The propaganda has been thick over the last few years, especially since the US banking system suffered a near fatal heart attack in September 2008, from which it has not yet recovered. It is still insolvent, still wrecked, having survived with an $800 billion government bailout and with a UST Bond carry trade core and a money laundering lifeline. It is beyond belief that a Zero Percent Interest Policy (ZIRP) is being touted as a stimulus measure to encourage a so called economic recovery especially since empirical evidence tells us that ZIRP is neither a stimulant, nor is the US Economy in a recovery mode. The official 0% rate signals a death knell to the national financial system and the country's economic vibrancy; the climax event slow in its pathogens is following the departure from the Gold Standard in 1971. The official 0% Fed Funds rate is a direct signal of terminal illness for the entire capitalist structures within both the United States and its Western partners who follow stupidly Socialist economic illiteracy. They followed the US lead into the housing and mortgage bubble disaster without learning their lesson and so they continue to follow the US monetary lead blindly. They claim to have no choice. But they do indeed have a choice: Stop being a lemming, discard the US Dollar, sell your US Treasury Bonds, cut back on your massive Socialist policies, reintroduce a Gold Standard and move back to Free Market Capitalism and prosper.

The reintroduction of the Gold Standard is just a matter of time. Do it voluntarily today and lead your economy back to prosperity or allow your economy to crumble, first into a socialist Depression, which is the inevitable conclusion of all Socialist economies. The East is no longer following the US lead, and a rebellion against the US Dollar and its toxic US Treasury Bond is already under way. Can you believe it? The two formally Communist, Eastern giants, Russia and China are forging a new path towards Free Markets, and the installation of a new Gold Trade Standard that thumbs its nose at the Western banking system and the FOREX currency market. Their marketplace will be the Eurasian Trade Zone and its gold backed central bank will be the BRICS Development Fund (clever name to disguise its eventual function).

The time is almost past due for the Western Democracies to head back to their roots that once made them the envy of the world.

Financial Survival

Many of the Silver Bear Cafe's readers have contacted me concerning the possible conversion of their IRAs and 401ks into treasuries. We have posted numerous articles concerning this topic. I have been predicting an occurrence of this nature since 2004. I believe it is truly something to be concerned about.

An IRA allows you to accumulate savings with the taxation of those funds deferred. This is very advantageous as your savings/earnings compound in a tax-free environment.

The problem, as I see it, is that the amount of money that is currently held in Individual Retirement Accounts by approximately 40 million Americans has grown so large, and the government has grown so broke, that the consideration that these funds could be converted into U.S Treasuries, and the funds then used to pay the salaries of the politicians and their government largess, has become a popular solution to many of our representatives in Congress.

What are the total amounts of money currently invested in IRAs, 401(k)s and Roths (separately)?

There are $8.2 trillion in total retirement assets, as of end of 2Q 2011 (according to the Investment Company Institute numbers):

$4.9 trillion in IRA's - $265 billion in Roths, the rest traditional, SEP, SAR-SEP and SIMPLE ;

$3.16 trillion in 401(k)

So, just for fun, how much would a trillion dollars in $100 bills weigh? Well:

$1 trillion = 10 billion $100 bills = 22,046,226.22 pounds

1 $100 bill weighs a gram x 10 billion = 10 billion grams = 10 million kilograms equals…22,046,226.22 pounds.

(BTW, a trillion dollars in $100 bills, stacked, would be a stack 670 miles high.)

That's an awfully big carrot to hang in front of an insatiable donkey/elephant. If you don't believe that your Federal Government would ever consider the confiscation, err no, I meant conversion, of your savings, into something they could spend, well, you haven't been reading "the Bear" for very long.

From National Seniors Council:

It may be time to take the tax hit and withdraw funds from private retirement accounts before they are forced into long term T-bonds.

The Obama administration is reportedly quickly moving on plans to nationalize private 401k and IRA retirement accounts, and replace them with government sponsored annuities(aka Treasury bonds that the Treasury currently can't sell to anyone but the Fed).

National Seniors Council Director Robert Crone warns: "This whole issue is moving forward very quickly. Already there is a bill requiring all businesses to automatically enroll their employees in IRA plans in which part of every employee's paycheck would be automatically deducted and deposited into this account. If this passes, the government will be just one step away from being able to confiscate all these retirement accounts." All your retirement savings are belong to us:

A recent hearing sponsored by the Treasury and Labor Departments marked the beginning of the Obama Administration's effort to nationalize the nation's pension system and to eliminate private retirement accounts including IRA's and 401k plans, NSC is warning.

The hearing, held in the Labor Department's main auditorium, was monitored by NSC staff and featured a line up of left-wing activists including one representative of the AFL-CIO who advocated for more government regulation over private retirement accounts and even the establishment of government-sponsored annuities that would take the place of 401k plans.

"This hearing was set up to explore why Americans are not saving as much for their retirement as they could," explains National Seniors Council National Director Robert Crone, "However, it is clear that this is the first step towards a government takeover. It feels just like the beginning of the debate over health care and we all know how that ended up."

A representative of the liberal Pension Rights Center, Rebecca Davis, testified that the government needs to get involved because 401k plans and IRAs are unfair to poor people. She demanded the Obama administration set up a "government-sponsored program administered by the PBGC (the governments' Pension Benefit Guarantee Corporation)." She proclaimed that even "private annuities are problematic."

Such "reforms" would effectively end private retirement accounts in America, Crone warns. "These people want the government to require that ultimately all Americans buy these government annuities instead of saving or investing on their own. The Government could then take these trillions of dollars and redistribute it through this new national retirement system."

You must first realize that there are, present in our lives, enemies. You must then know who those enemies are and act accordingly.

Eliminate as much debt as possible, especially “variable rate” debt, such as credit cards and lines of credit. Interest rates will be rising, so the elimination of debt offers a “real return” of escaping rising rates by creditors.

Get some control over some fresh water.

If you are depending on Social Security, stop.

Follow the course opposite to custom and you will almost always do well...

Its not what you don't know that will screw you up, it's what you know that is wrong. The spin you hear from the mainstream media is intended to mislead you. Open your eyes and face the future. If you leave your head in the sand and ignore it, you are only leaving your butt exposed for the world to kick. This all may sound like gloom and doom, but when you get a handle on what is going to happen, you will have a future filled with opportunity. Fortune favors the Informed.

More next week...

May the Great Spirit be with you always,

Johnny Silver Bear
Chief cook and bottle washer, The Silver Bear Cafe

Disclaimer

All statements and expressions are the sole opinions of the editor and are subject to change without notice. A profile, description, or other mention of a company in the newsletter is neither an offer nor solicitation to buy or sell any securities mentioned. While we believe all sources of information to be factual and reliable, in no way do we represent or guarantee the accuracy thereof, nor the statements made herein. The staff of Silver Bear Cafe are not registered investment advisors and do not purport to offer personalized investment related advice. The publisher, editor, staff, or anyone associated with, or associated to the Silver Bear Cafe may own securities mentioned in this newsletter and may buy or sell securities without notice.