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 country is currently mired in, and vexed by, a criminal administration which is, brazenly, fronting for a criminal banking cartel. The banks, through the use of lobbyists, toddies, shills and go betweens, have, effectively, through the elimination of regulation, unbridled the wanton greed so common in the world of finance.

Attorney General Eric Holder, during testimony before Congress last week, admitted that he was aware long before the bank's admission in court, that HSBC had been laundering billions of dollars in drug money profits for both the Columbian and Mexican drug cartels.

The banks' laundering transactions were so brazen that the NSA probably could have spotted them from space. Drug dealers would come to HSBC's Mexican branches and "deposit hundreds of thousands of dollars in cash, in a single day, into a single account, using boxes designed to fit the precise dimensions of the teller windows."

This bears repeating: in order to more efficiently move as much illegal money as possible into the "legitimate" banking institution HSBC, drug dealers specifically designed boxes to fit through the bank's teller windows.

This admission, coming on the heels of the "Fast and Furious" scandal which was the realization that, for years, the U.S. government through the BATF, has been running elaborate "gunwalking" operations on the Mexican border, only to end up providing over 2000 fully automatic weapons to the cartels.

Holder's testimony brought to light what had been widely suspected, and that was that HSBC had bought off Washington to such a degree that their prosecution was a non issue and would never occur.

Meanwhile, in the realm of correctional services, the private prison industry thrives on the incarceration of thousands for the victimless crime of possession. The incarceration of these minions is billed to the 30% of Americans who pay taxes. There is certainly a glaring and disparaging chasm between the criminal elite and the "unwashed masses".

From Ted Butler:

Every once in a while, someone utters a statement that suddenly galvanizes the issue at hand. In the fable "The Emperor's New Clothes," Hans Christian Andersen tells of two weavers who convince the emperor that their special clothing for him is invisible only to those unworthy. When the emperor parades in front of his subjects wearing the special clothing, a child cries out the obvious, "he isn't wearing any clothes at all." That's the first thing that came to my mind when I read of the US Attorney General's words before a Senate hearing this week.

Asked why the government hadn't pursued criminal charges in a case where a large bank admitted to money laundering for drug interests, Attorney General Eric Holder said: "I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy." A senator admitted to being stunned by the frankness of the response. While Mr. Holder's no-nonsense answer got the widespread attention it deserved, it should have resonated most loudly with silver investors, or at least with readers of this service.

On the Economic War Front

There has been, for several decades, a move to a cashless society. This move can only benefit those that would prey on the fruits of our labor. Cash, being the medium with which we can conduct private business with one another, is an intrinsic component in our economic freedom. The lack of cash would greatly diminish our ability to interact privately. This is why the various systems of barter are becoming more and more popular. The powers that be would have us all chipped which would result in our financial, medical, and legal information being readily available to anyone with a scanner. If deposits to your account could be rejected and monies on account confiscated, and you couldn't use cash for transactions, you would be broke and would become a total slave to the system. That is the objective of the Darkside.

From Joseph Salerno:

The relentless wars waged by governments worldwide has perhaps gone furthest in Scandinavia. The ostensible reason given by our rulers for suppressing cash is to keep society safe from terrorists, tax evaders, money launderers, drug cartels and sundry other villains, real or imagined. But the actual aim of the recent flood of laws rendering cash transactions less convenient or limiting or even prohibiting them is to force the public at large to make payments through the financial system in order to prop up the unstable fractional-reserve banks and, more importantly, to expand the ability of governments to spy on and keep track of their citizens’ most private financial dealings. One ingenious friend from Norway has fought to protect his right to use cash by invoking his government’s own legal tender laws against it. Here is his story in his own words:

About a month ago I had a doctor’s appointment at the city’s health services emergency ward (government institution).

When leaving, I asked to pay cash. I was told that the cashier’s desk was closed, that I would be invoiced, and that they generally did not accept cash. I reminded the nurse(?) on duty about legal tender.

When I got the invoice, I called accounting at the ward. I told the accountant that I wished to pay cash. I was told that was not possible. I asked if she knew about legal tender, referring to the specific legislation. She went completely defensive, as I clearly perceived it. She even claimed that legal issues with the no-cash arrangement had been dealt with. I said I would file a written complaint.

So I did. I called in a few days later to check if the complaint had been received, which she could confirm. Now the accountant was apparently more interested in discussing the issue.

Yesterday, I got the written response. I was given the opportunity to pay cash in this one case if I brought the exact amount. Moreover, no changes in the general arrangements would be made. Today, I made the payment in cash.

Why did they do this? I would suspect that they figured they had a weak legal case, that they were dealing with someone who apparently wasn’t going to give up, and that allowing it in this case would avoid having to deal with someone with a formal legal interest in challenging their anti-cash system, the alternatives being changing their system voluntarily and fighting an administrative complaint case — or even worse, a court case.

Of course, things would be much better if we weren’t forced to use this fiat money. However, it is reasonable to expect government institutions to comply with the government’s own legal tender regulations.

Precious Metals

In the last week, my wife and I have dined out twice, which has been, more often than usual. We are in Dallas and, as a result, privy to some very good Mexican food. Wednesday we went to an very nice, but not formal restaurant called Mi Cocina. We shared a guacamole appetizer, and then enjoyed chicken and cheese enchiladas. I had a Margarita, she had tea. The bill was $49.00 plus tip.

Friday she wanted fish. The Fish City Grill provided a special on Sea Bass which my wife opted for. I had a dozen oysters. Again I had a cocktail, she had tea. Again, the dinner was $48.00 plus tip. Her comment was to the effect that it seemed like everyone had raised their prices substantially. It seemed like we have been eating at the same restaurants and others of a similar ilk, for half as much. Actually, the value of the fare had remained consistent. The value of the medium with which we were paying, however, had diminished dramatically.

As I have been railing about for years, inflation is theft. The criminal manipulation of the precious metals markets is simply an attempt to keep the spotlight off inflation. Ten years ago, we could have had the same dinners, at the same restaurants, for two ounces of silver for two of us. Today, we could have gotten them for an ounce and a half. In spite of the manipulation, the cost of our meals had, in real terms, gotten cheaper, not more expensive. If it wasn't for the criminal manipulation (which I believe is just about to come to an end) we could have spent one ounce of silver for both nights including tips.

From Lawrence Williams:

The ever continuing movement of vast amounts of gold and silver to the East in particular begs the question of how physical demand is being satisfied elsewhere.

Some years ago the Wendy’s hamburger chain ran what was probably its most successful advertising campaign ever where the punchline – ‘Where’s the beef’ - was uttered by a little old lady. How much more so might this be relevant to the gold and silver markets today where the volumes traded on the key markets exceed the amount of physical metal available many, many times over. As numerous observers have pointed out this opens them up to accusations of severe market manipulation and seems to be something the various financial authorities seem unable, or unwilling to take a serious interest in curtailing.

But if this is the case, what is happening to the newly mined physical gold and silver? Where’s the gold? India and China on their own account would nowadays seem to take the bulk of global production based purely on Indian government statistics and Chinese official data for imports through Hong Kong, coupled with China’s own gold production which doesn’t leave the country. Add to that smuggled gold (into India in particular) and gold possibly entering China through other channels plus announced Central Bank purchases and one wonders indeed how physical demand elsewhere in the world is being satisfied – and there is indeed demand for physical bullion other than in those two nations and from the Central Banks. Gold and silver bullion coins are selling at record levels and this may even be dwarfed by sales in small bar form. The real statistics just don’t seem to add up.

Some of the demand may have been satisfied in recent weeks by offloads from the SPDR Gold ETF in particular, although there are some, like Eric Sprott, who cast doubt on the ETFs holding what they say they do in terms of physical metal. If this is the case it would suggest a fraud on a massive scale and this writer tends to discount this suggestion, at least as far as the biggest players in this sector are concerned. Sprott also feels that, perhaps, Western Central Banks are supplying the markets with physical gold without reporting it– indeed many have suggested that the central banks do not hold what they say they do, having leased it out to the bullion banks who have, in turn, sold it on. The Central Bank accounts show leased gold as still being on their books, but with a potential shortage of physical metal on the markets, so the theory goes, it would be difficult to claw the metal back into the Central Bank vaults in a short period of time – if ever! This accounts for the theories which have sprung up over the German Bundesbank having to wait seven years to repatriate some of its gold from the NY Fed – a process which should be able to be achieved in a matter of days, although admittedly banks do not tend to move quickly at the best of times – but perhaps not that slowly either.

If this does, indeed, represent a globally orchestrated attempt to suppress the price of gold, as commentators like the Gold Anti Trust Action Committee (GATA) have alluded to for many years, it is not one aimed at preventing the gold investor making money – that is collateral damage – but rather it would be an attempt to maintain some kind of global financial stability, given gold’s centuries-long role as a bellwether of financial responsibility. The profligate printing of money under the Quantitative Easing programmes makes this very relevant today and is perhaps why the assumed market manipulation seems to be so open and intense.

Energy

I have always enjoyed our Energy Forum because it allows the documentation of the crimes being perpetrated by the Darkside, against the American Middle Class, to face the light of day in a completely different perspective. Lat week we discussed the technology of Nikoli Tesla and his application of harvesting static electricity which could provide free electricity for all..

This week we examined other old technologies that, out of "a need for greed" have been quashed in order for TPTB to continue to extract their pound of flesh...

The following is a video of the Hemp Car prototype made by Henry Ford in 1941. In the video, Ford is seen striking the trunk of the car WITH AN AXE, and leaving no dents whatsoever. The "Hemplastic" seen is about 60% of the weight of steel, and ten (10) times more durable.

From Doug Yurchey:

In the 1930s, innovations in farm machinery would have caused an industrial revolution when applied to hemp. This single resource could have created millions of new jobs generating thousands of quality products. Hemp, if not made illegal, would have brought America out of the Great Depression.

William Randolph Hearst (Citizen Kane) and the Hearst Paper Manufacturing Division of Kimberly Clark owned vast acreage of timberlands. The Hearst Company supplied most paper products. Patty Hearst's grandfather, a destroyer of nature for his own personal profit, stood to lose billions because of hemp.

In 1937, Dupont patented the processes to make plastics from oil and coal. Dupont's Annual Report urged stockholders to invest in its new petrochemical division. Synthetics such as plastics, cellophane, celluloid, methanol, nylon, rayon, Dacron, etc., could now be made from oil. Natural hemp industrialization would have ruined over 80% of Dupont's business.

THE CONSPIRACY

Andrew Mellon became Hoover's Secretary of the Treasury and Dupont's primary investor. He appointed his future nephew-in-law, Harry J. Anslinger, to head the Federal Bureau of Narcotics and Dangerous Drugs.

Secret meetings were held by these financial tycoons. Hemp was declared dangerous and a threat to their billion dollar enterprises. For their dynasties to remain intact, hemp had to go. These men took an obscure Mexican slang word: 'Marijuana' and pushed it into the consciousness of America.  

MEDIA MANIPULATION

A media blitz of 'yellow journalism' raged in the late 1920s and 1930s. Hearst's newspapers ran stories emphasizing the horrors of Marijuana. The menace of Marijuana made headlines. Readers learned that it was responsible for everything from car accidents to loose morality.

Films like 'Reefer Madness' (1936), 'Marijuana: Assassin of Youth' (1935) and 'Marijuana: The Devil's Weed' (1936) were propaganda designed by these industrialists to create an enemy. Their purpose was to gain public support so that anti-Marijuana laws could be passed.

The Fed

It has always been well known amongst intelligent politicians, (who have, apparently, remained in the minority), that the gold standard protected citizens against the controlling tendencies of the government by offering an absolute hedge against the depreciation or devaluation of the currency. Gold has provided an agent of maintenance and liquidity within and beyond national borders. Above all, it has raised a mighty barrier against authoritarian interferences through the manipulation of the economic markets. Within the constraints imposed by the gold standard, America's economy remained relatively healthy until 1913.

On December 23, 1913, the U.S. Congress passed the Federal Reserve Act, placing control of this nation's money into the hands of a private corporation. This corporation was made up entirely of bankers. Calling itself the Federal Reserve, so as to seem official, it replaced the national bank system. Treasury notes were recalled and Federal Reserve notes were issued with a promise to redeem them in gold on demand. The forces behind the Federal Reserve, (American and Western European banking interests), remained tethered by the limits imposed by the gold standard, but this would soon change.

In 1920, the 66th Congress passed the Independent Treasury Act.

In 1921, the United States Congress abolished the U.S. Treasury, and, as a result, all of our country's bullion and all other instruments of value, ( i.e...moneys in trust funds and other special funds that had been kept in U.S. Treasury offices and vaults), were systematically transferred to the coffers of a private corporation!

From 1913, until 1933, under the authority of the U.S. Congress, the Federal Reserve held control of all of our country's gold. They then proceeded to loan us back our gold, at interest. We paid interest for the use of our own gold! What's wrong with this picture? What could have incited our Senators and Representatives to allow that to happen? In order to keep up with the ever rising debt service, we borrowed more of our own gold. We kept borrowing more and more of our own gold to pay more and more interest, until all the gold was gone. At that point, the country went bankrupt. Guess what happened next.

The bankers foreclosed on America. I know what you're thinking. Me too. (An excerpt from one of my essays: The Nature of Money and Our Monetary System)

From George Leong:

The Federal Reserve may be responsible for the biggest financial meltdown yet to come. In fact, this meltdown could be even bigger than the subprime mortgage crisis in 2008.

Let me explain. We all know the Federal Reserve has created an artificial economy that has been built on the availability of easy access to cheap money due to near-zero interest rates. There is no argument here. Via its aggressive quantitative easing programs, the Federal Reserve has produced an economy that is dependent on cheap capital.

Some would argue the Federal Reserve didn't have a choice; if they didn't introduce monetary policy, the housing market and banking system may have collapsed. I agree to that extent, but with the economy now in recovery, you kind of wonder why the Federal Reserve continues to allow the flow of easy money.

Recently at its January Federal Open Market Committee (FOMC) meeting, the Federal Reserve suggested that it would have to review the possible stoppage or slowing of its $85.0 billion in monthly bond purchases. The market reacted by selling stocks. Federal Reserve Chairman Ben Bernanke then came out and said that the central bank was committed to its monthly bond buying as long as the economy and employment remain fragile. So which is it? The Federal Reserve needs to really think about reining in its easy monetary policy and reducing the amount of the M2 (all money in circulation, plus savings deposits, time-related deposits, and market-money funds) money supply in the system.

Here's the dilemma:

The climate of historically low interest rates has driven a false sense of comfort. Consumers are buying more due to the low financing charges. Whether it's a home, furniture, vehicle, computer, or other non-perishable good or service, the incentive of low interest rates has resulted in an economy that could be in trouble once interest rates ratchet higher—and they will.

According to the Federal Reserve Bank of New York, aggregate consumer debts increased by $31.0 billion in the fourth quarter, which is not a big change; but consider the amount of consumer debt at the end of 2012—it was an astounding $11.3 trillion. (Source: "Quarterly Report on Household Debt and Credit: February 2013," Federal Reserve Bank of New York web site, last accessed March 13, 2013.) The amount is below the record $12.7 trillion in the third quarter of 2008, but it's still high and extremely vulnerable to higher interest rates, which will have an impact on consumer spending and gross domestic product (GDP) growth. Retailers could feel the pinch again.

There has been improvement in the housing market, but another 210,000 homeowners were foreclosed on in the fourth quarter. (Source: Ibid.) Just imagine when rates move higher? I'm still wary about the current run-up in housing starts, and I advise caution.

The news isn't good for students, either. The amount of student loans outstanding was a staggering $966 billion at the end of 2012. (Source: Ibid.) A concern is the11.7% of students who are delinquent on student loan payments over 90 days late, and this number is rising. Of course, the lack of jobs for graduates is not helping.

My concern is the amount of indebtedness in the country, especially as interest rates begin to rise over the next few years. And the Federal Reserve has helped to create this situation, which could wreak some major havoc and may cause a financial crisis down the road. Given this, once rates begin to ratchet higher, you may want to cut your exposure to stocks.

Financial Survival

The Southern Poverty Law Center was recently, again, brought to my attention when I received a link to a web site entitled "Who Controls America?" Among the plethora of links provided exploring Banking/Finance, Mass Media, Government/Politics, Social Engineering, and the "New World Order" one of the links in the Social Engineering category is the Southern Poverty Law Center. While the "Who Controls America?" web site does not seem to purvey an opinion on the persons and organizations listed, it does, irrefutably, point out a glaring common theme. Fully 80+% of everyone listed in 37 categories are Ashkenazi Jews. A mere coincidence? I think not.

 

From wikipedia.org: The exact definition of Jewishness is not universally agreed upon—neither by religious scholars (especially across different denominations); nor in the context of politics (as applied to those who wish to make Aliyah); nor even in the conventional, everyday sense where "Jewishness" may be loosely understood by the casual observer as encompassing both religious and secular Jews, or religious Jews alone. This makes it especially difficult to define who is an Ashkenazi Jew. The people have been defined differently from religious, cultural, or ethnic perspectives.

Since the overwhelming majority of Ashkenazi Jews no longer live in Eastern Europe, the isolation that once favored a distinct religious tradition and culture has vanished. The center of Judaism today is once again in Israel, although a large community continues to live abroad, particularly in the United States of America, where Ashkenazi Jews live alongside other Jewish groups. Furthermore, the word Ashkenazi is often used in non-traditional ways, especially in Israel. By conservative and orthodox philosophies, a person can be considered a Jew only if his or her mother was Jewish (meaning, more specifically, either matrilineal descent from a female believed to be present at Mt. Sinai when the ten commandments were given, or else descent from a female who was converted to Judaism before the birth of her children), or if he or she has personally converted to Judaism. This means that a person can be Ashkenazi but not considered a Jew by some of those within the Jewish communities, making the term "Ashkenazi" more applicable as broad ethnicity which evolved from the practice of Judaism in Europe.

I have been honored by the SPLC by being listed as a patriot organization on a page called "Active 'Patriot' Groups in the United States in 2011".

As I explored all the categories on "Who Controls America?" I could not help but realize that a conspiracy is afoot, and, perhaps, the conspiracy to end all conspiracies. I would appear that America is being run by members of a club that we don't belong to. Please take the time to follow the links to confirm what I mean.

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.