2012 Outlook Europa Vest Si Sua-Analisti Realisti Nu Mincinosi

TedBitsNewsletter:February24,2012
TedBits:TheEconomicandFinancialNOSPINZone GlobalMacroeconomicAnalysisThroughtheAustrianLens
ByTheodore(Ty)Andros
2012Outlook,Part2:Bombs,er..Bonds;Currencies&Gold
The UNFOLDING destruction of the developed worlds economies and financial/currency systems continues apace. Public servants are trying to defy Mother Nature with the stroke of a pen; she will not yield to this. Radical Marxist POLITICAL solutions to practical problems are at the end of their collective ropes (double entendre intended). You CANNOTstorewealthinpaper,PERIOD.Thosewhodowillgetwhattheydeserve:NOTHING.Ithasbeenandwillbe printed endlessly from this point forward as Socialist government policies have destroyed wealth creation and substituted Ponzi assetbacked economies in their place. Now those economic models have reached their COLLECTIVEendpoints. Economies based on models of consuming wealth rather than producing wealth are DOOMED, and this is the definition of the developed world. Switching back to the wealthproduction model used prior to 1971 in the developedworldwillbepainfulasourleadershaveFORGOTTENwhatwealthcreatingpoliciestoimplementandhow todoso. The financial systems of the world sit on TOXIC paper (government bonds and currencies) and they call them assets and reserves they are NOT, THEY ARE LIABILITIES! To see the enormity of government debt in the biggest economiesintheworldlookatthisgraphicfromwww.demonocracy.info:
These are worthless checks which can never be REDEEMED in the biggest check kiting scheme in history, BAR NONE. They are backed by nothing, redeemable in nothing and PAY nothing and called RISK FREE investments. This is a testamenttoGeorgeOrwellandthefinancialilliteracySPAWNEDbyPUBLICSCHOOLS. These financial and currency systems are run by the Central Banks and public servants and prey upon their citizens wealthforredistributiontogovernmentdependents,elites,cronycapitalistsandgovernmentemployees.Thewhole fabric of developedworld governments is PREYING on the private sector in one manner or another: currency debasement; crony capitalism through oppressive regulation; and taxation of virtually any activity in which a human engages,andtheysaytheyareservingandprotectingthepublic.THEENDISNEAR.Theyhavepreyedontheprivate sectortothepointthatthegooseisDEADandcannolongerlayeggs.
Copyright 2012 Apollo Alternative Investments Ltd. -- Portions may be reproduced ONLY with full credit and contact info. to Ty Andros at TyAndros@Traderview.com and www.traderview.com Past performance is not indicative of future results. There is risk of loss in trading.
TedBitsNewsletter:February24,2012 SomethingfornothingsocietiesarelikeLOCUSTSsearchingforsomethingfornothing;theywillEATeverythinginthe developed world right down to the roots including the seed corn for next years harvest and their childrens future earnings (these are morally and fiscallybankrupt leaders and citizens). They are spending tomorrows income today andwaitingforthebankruptcytoarrive. They did this years ago inGreece and in mainland Europe for that matter, they are doing it now in the United States. Greece is a Socialist country; it produces next to nothing and has driven wealth creation OUT OF THE COUNTRY. For generations, the people have been taught that they are entitled to a greater standard of living than they produce. Thirty percent of the WORKING population is made up of GOVERNMENT EMPLOYEES (same as in the US). No bankruptcy will restart wealth and income production. The people who are the real income producers left decades agoatthepointofagovernmentconfiscatorygunandtheyareNEVERcomingback. Why in the world would anyone start a business in the United States when the Federal Government is DEDICATED to confiscating any wealth they may produce, and with a President that is running for office on the platform of demonizingsuccessand telling people thatbysupporting himtheywillberewardedwithalltheyneed? Guaranteed by government, just like the other $100 trillion worth of promises the government has made but not paid for. The peoplewhobelievethisarehisFOOLS;hispromisescanneverbePAIDexceptwithincreasinglyWORTHLESScoupons calledUSDollars. "Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, Its inherent virtue is the equalsharingofmisery"~WinstonChurchill GROWTH WILL NEVER RESUME as to do so is to invite punishment and slavery to the WELFARE State. The psychological destruction by the presidents CLASS WARFARE rhetoric on entrepreneurs and small businessmen cannotbeunderestimated;itwilltakeyearstoundoit. TAXES are set to SKYROCKET in the United States at the end of 2012 (further punishment for the prudent and hard working) but no public servant dares bring up the subject because both parties WANT the money to FUND their PREVIOUS policies of insolvency. Human behavior is quite predictable with this recipe; IT IS A RECIPE for FAILURE andtosubstituteforlackofgrowthandincometheywillPRINTtheMONEY. "Thebestwaytodestroythecapitalistsystemistodebauchthecurrency.Thereisnosubtler,nosurermeans of overturning the existing basis of society than to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens... There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency.Theprocessengagesallthehiddenforcesofeconomiclawonthesideofdestruction,anddoesitin amannerwhichnotonemaninamillionisabletodiagnose.~JohnMaynardKeynes Bonds and currencies are the epicenter of the crisis and this OUTCOME was set in stone at Bretton Woods II on August 15th, 1971: Money and credit creation out of thin air which is a mechanism for redistributing wealth, in addition torunaway,LEVIATHAN government that hasresulted intheSocialistMarxist command economieswe now inhabit. Now the commanders in Washington DC, Brussels and Berlin know only one policy: Bury them some more underthousandsofnewlaws,taxesandregulations. Now the bills are coming due and they are unpayable and inextinguishable as REAL wealth and income generation havegonethewayoftheDODObird.SoitsHiHo,HiHoofftotheprintingpresstheSocialistswillgo,pretendingto
TedBitsNewsletter:February24,2012 pay money back using worthless coupons they call money printed out of thin air. They are fools as are the people thatsupportthem. When the people find that they can vote themselves money that will herald the end of the Republic. This constitutionintimewillfail,asallsucheffortsdo.Anditwillfailbecauseofthecorruptionofthepeople,ina generalsense.~BenjaminFranklin With a printing press they are stealing purchasing power right out of the bank accounts of the private sector: companies, retirees, pension funds, institutions. These innocents that have full faith in the dollar will soon understand the US Government is not GOD, but rather has now become the devil in disguise and is sending present andfuturegenerationstoDEBTORShelljustlikethepeopleinGREECE. Economicactivity,employment,inflationandGDPreportsarenothingbutacruelhoaxtofoolthemasses(thiswillbe covered in a future edition, new information indicates the US economy is smaller by 10% or more than OFFICIALLY reported). The mainstream media is misdirecting the anger of the middle class from those who destroy wealth towards those who produce it. They are driving whats left of privatesector growth into hibernation because to create wealth is to invite attacks on oneself for having the temerity to work hard and succeed. This is cannibalism of theworstsortatthehandsofgovernmentandtheirsomethingfornothingconstituents. Capitalism is dead in the lands of its birth, with socialist dictatorships doing what they always do as their economies DIE from their deadly embrace. Miseryspreadwidely is and WILL BE the order of the day as will a shrinking economic pie, taken from the most productive and redistributed to their supporters. As wealth and income creation ceaseMarxistSocialiststurntoprintingpresses. "Thedemocracywillceasetoexistwhenyoutakeawayfromthosewhoarewillingtoworkandgivetothose whowouldnot."~ThomasJefferson OB@M@careisnothing morethantakinghealthcarefromthosethathaveandpayforitandtransferringittothose that dont. Rationing and mandates are just the beginning as Washington writes rulebooks for your physician to follow. Heres a peek: Billing codes under the new healthcare law are going from 18,000 to 140,000. This is going into effect in January 2013, just after the election. Why is no one talking about this? Telling the public about this OBSCENITYItwillneverberepealed. Can you say ABSURD and unworkable? It is only the beginning. Dodd Frank is nothing more than 2,400 pages of political corruption, the nationalization and politicization of the BANKING industry and the allocation of credit. It transfersliabilityfromthenineteenTOOBIGTOFAILbankstothepublicwhoaretheirDUPES. Wealth generation in the developed world is a statistical illusion courtesy of the LAWMAKERS and their bureaucrats who rule over us. Public servants are bought and paid for by the Crony Capitalists and Banksters who are their masterstothechagrinofapublicwhohasplacedtheirfaithandfuturesintheirhands. Since my last missive several weeks ago money printing has been the order of the day as Japan and the UK have thrown approximately $200+ billion and the US Congress added over 10% to the $1.3 trillion deficit and sent the bill to future generations when it recently wrote an NSF check of $150+ billion to extend the social security tax cut and extend unemployment benefits as more and more people are impoverished by the policies of leviathan government. $350+ billion all told small change by todays measures. Several Bank of England directors voted for 50% MORE moneyprinting.ThenexttrancheisBAKEDintheCAKE.
TedBitsNewsletter:February24,2012 The chosen one is padding his constituency of government dependents prior to his reelection efforts and executing the Cloward Piven Strategy for collapsing the US economy with a deft touch that befuddles and frustrates those with thelastvestigesofcommonsense.Lawmakersvoteforsomethingfornothingorbedemonizedascruelheartedfor notspendingmoneyTHEYDONTHAVE. We await the next big CENTRAL BANK cannon firing next week when Mario BOOM BOOM Draghli fires the next installment of the European Central Banks long term repo operation (LTRO). Some project it as high as 1 trillion euros. No matter, it is only the next installment in a neverending story of the moral and fiscal bankruptcy of the developed world. Trillions and trillions are left to be printed as the bonds going bad were used for CONSUMPTION ratherthanselfliquidatinginvestment. The LTRO is VERY toxic, as is the SMP program while the ECB INSERTS itself above all other creditors thereby SUBORDINATINGthem.Overseventrilliondollarsworthofsovereigndebtmustrollin2012;howmanyinstitutional investors, pension funds or insurance companies will choose not to ROLL? Many are prohibited from buying or holdingsubordinateddebt,butthequestionisdotheyrecognizethis? TheBondandCurrencyMarketsaretheepicenteroftheglobalfinancialcrisisanditwillnotenduntiltheyBLOWUP. Currencies in todays world are nothing more than BONDS in DISGUISE, as semiREAL money CEASED to EXIST in generalcirculationatBrettonWoodsIIinAugust1971.BondsarenothingmorethanIOUsdenominatedinIOUs.If onecreditordoesntgetyoutheotheronewill! A price revolution is unfolding like a tsunami ready to strike shore. When it hits you dont want to be in its path or you may perish as those poor people in Japan did. The Tsunami is growing in size and magnitude as I shall illustrate. When it hits is another story, but the timeframes are accelerating as public servants, banksters and crony capitalists try to print and borrow their way to solvency. They will fail as all others have done in the past, throughout history, butnotbeingstudentsofhistoryTHEYWILLTRY Austrian economics are extremely predictive, to which my long time readers will attest. The longer this takes to unfold, the more prepared you can become. Thank God for a poorlyinformed public, as the day they understand what is transpiring is the day the NUCLEAR financial bombs GO OFF. The CONFIDENCE game will end on that day! The day when the publics eyes cease to glaze over is the day you must have your final preparations in place. When theBabyboomerspullintotheretirementstationtheywillbegreetedbythegreatestbankruptcyinhistoryandtheir retirement plans will VANISH as their wealth stored in paper VAPORIZES at the hands of the people holding the financialsystemmonopolies.Thisishistoryrepeatingonaninconceivablescale.Willitbecrisisoranopportunityfor YOU? ThisisthegreatestOPPORTUNITYinHISTORYoryourdemise.Inordertothriveyoumustbeabletorestorethe functionsofmoneytoyourportfolio.Shortcircuittheprintingpress.Maketheprintingpressyourfriend.Learnto makemoneyinfallingandrisingmarkets.Preserveandbuildyourwealthforthegreatestbuyingopportunityin historyforstocksandrealestate.Volatilityisopportunitytothepreparedinvestor.DiversificationintoAbsolute Returnalternativeinvestmentswiththepotentialtothriveinup,downandsidewaysmarketsarepartoftheanswer. ThisiswhatIdo,formoreinformationandprivateconsultationCLICKHERE(www.TraderView.com/portfolio/) When properly measured and adjusted for inflation, the economies of the developed world are no longer growing and havent done so since 1998. Subtract government spending which is errantly counted as growth and we see the private sector hasnt grown for an equally long period. Take a look at this chart from John Mauldin and Rob Arnott (researchaffliates):
When adjusted for real inflation, privatesector growth has been in FREEFALL since 1998; the public has been impoverished by unsound money and runaway inflation. This chart uses official inflation numbers so the reality is MUCH worse. Think about it, debt in the developed world is up 300%+ but privatesector income is ZERO. Government doesnt create wealth which can service debt. All debt, public and private, is serviced by privatesector growthandtaxreceipts. Over$15trillionhavebeenprintedandborrowedsince2008andthereisZEROgrowthtoshowforitthroughoutthe developed world. The money has been consumed in transfer payments to government dependents and has funded the further expansion of government. The consumption economies where growth is measured in how much more youcanconsumethanyouproduceandpayforitwithborrowingisfailing.Ponzifinanceisattheendoftheroad. Consumptionisnotwealthproduction,notinthepublicorprivatesector. USFederaldebtisupover50%since2008anditsangleofascentisgoingVERTICAL:
This picture is echoed throughout the developed world. These illustrations are extremely predictive when applied to thegoldprice(perfectlycorrelated)incontextwithdeficitspendingasthischartillustrates:
The exponential rise in gold is dead ahead as debt creation and printing presses accelerate. Notice that the last 2.3 trillion dollar debt increase has NOT been PRICED IN. Gold has been in a tenyear BULL market (no market has outperformedinthattimeframe).BullmarketsDONOTendwithawhimper;theyendwithaBANG. Now lets look at whats in the PIPELINE as illustrated by the combined Central Bank balance sheets of the 8 biggest CentralBanks,below:
This is up over $2 trillion since this graph was created at the end of November. The average money creation is now almost $500 billion a quarter, that of the TARP in 2008. The money to prop the financial system and fund the welfare states is spiraling out of control. Since 2006 this measure is up MORE than 200% and NOTHING has been solved. NOTHING. If that Central Bank balance sheet chart didnt scare the pants off you, the next one will. This is a picture of global money supply in the last two years; it has increased 20%,hittingnewhighs:
TedBitsNewsletter:February24,2012 This is MONEY PRINTING. The insolvencies are multiple times greater than in 2006; Billions of new, unfunded promises have been made. How many Trillions are left to be created (I believe at least $30 Trillion). Do you really thinkyoucanstorewealthinpapercurrenciesandbondsafterseeingthesetwocharts? The Question is: When will consumer prices adjust to REFLECT the debasement and loss of purchasing power? How much will your cash and bonds be worth in purchasing power when they reflect this graph? The next question is: HowmuchmorebalancesheetEXPANSIONwilloccurtoSAVEtheBANKSTERSandfeedtheWELFAREstates?Wewill havetheanswertoallthesequestions.NowletslookatthefutureUNFUNDEDwelfarestatepromises:
Japan is not shown, but its debttoGDP is already over 200%; is due this year and unfunded liabilities are more thanlikelyrightinlinewiththeseothercountries.KeepinmindtheseeconomiesDONOTGROW(correctlyadjusted for inflation and minus government growth, called production), they have HUGE and growing structural BARRIERS to growth erected to protect Crony Capitalists from competition and reward the latest crops of campaign donors, they have tax systems that PUNISH wealth creation, entitlements which are on auto pilot, and populations and their representatives which REFUSE to act prudently. The Federal Reserve under Project Twist is still monetizing most of the new treasury issuance, as this table outlines:
TedBitsNewsletter:February24,2012 TheChineseandRussiansaredumpingtreasuriesatarapidrateseeingtheupcomingtrainwreckandtryingtogetoff thetrain,asthischartillustrates(courtesyofwww.zerohedge.com):
Notice how the Federal Reserve, the Bank of Japan and the Bank of England are monetizing US debt and increasing their reserves? They call them assets, but how can that be when both the bonds they bought and the money they printed to buy them were PRINTED OUT OF THIN AIR? It is an illusion. For the most part, all three economies are barelygrowingandrunningMASSIVEdeficitsforgovernmentspending,whichtheyreportasGDP. In order to put in perspective what has been done by the Federal Government in Washington, in addition to the present and FUTURE destination of money printing and the debt requires that we look at a recent debt clock (www.usdebtclock.org,asofFeb23,2012):
This is ugly, but at the current rate of DEFICIT spending, at the next presidential election in November 2016 the bills willhaveLEAPTto:
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Imagecourtesyofwww.ZEROHEDGE.com A breathtaking leap of almost 60%, after 60% growth in the presidents first four years. Of course, dont forget that the paper in which you store your wealth will have LOST an equivalent amount of purchasing power; yet the federal government REFUSES to cut spending. These numbers DO NOT INCLUDE future BAILOUTS of the financial system, Fannie Mae, Freddie Mac, FHA, unfunded government pensions, and state and municipal insolvencies which will be TRILLIONS&TRILLIONSmore. AlanGreenspan,beforehebreathedthecontaminatedairofWashingtonDC,wrotethisaboutgoldin1966: Theabandonmentofthegoldstandardmadeitpossibleforthewelfarestatiststousethebankingsystemas a means to an unlimited expansion of credit. They have created paper reserves in the form of government bondswhichthroughacomplexseriesofsteps thebanksacceptinplaceoftangibleassetsandtreatasif theywereanactualdeposit,i.e.,theequivalentofwhatwasformerlyadepositofgold. The holder of a government bond or of a bank deposit created by paper reserves believes that he has a valid claimonarealasset.Butthefactisthattherearenowmoreclaimsoutstandingthanrealassets. The law of supply and demand is not to be conned. As the supply of money (of claims) increases relative to the supply of tangible assets in the economy, prices must eventually rise. Thus the earnings saved by the productive members of the society lose value in terms of goods. When the economys books are finally
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TedBitsNewsletter:February24,2012 balanced, one finds that this loss in value represents the goods purchased by the government for welfare or otherpurposeswiththemoneyproceedsofthegovernmentbondsfinancedbybankcreditexpansion. In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value.If there were, the government wouldhave tomake its holding illegal,as was doneinthecasegold.Ifeveryonedecided,forexample,toconvertallhisbankdepositstosilverorcopperor any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government created bank credit would be worthless as a claim as goods. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves. This is the shabby secret of the welfare statists tirades against gold. Deficit spending is simply a scheme for thehiddenconfiscationofwealth.Goldstandsinthewayofthisinsidiousprocess.Itstandsasaprotector ofpropertyrights.~AlanGreenspan,GoldandEconomicFreedom,1966 Thank you Bert Dohmen and his outstanding Wellington Letter (I highly recommend it) for this wonderful quote which sums up quite nicely how wealth cannot be stored in paper. Greenspan recognized it 50+ years ago when he wasacloseassociateofAynRand.AsFederalReservechairmanhewastheperpetratorofit. In closing: This is not Doom and Gloom; it is the reality of the situation. In Fact it is the greatest opportunity in history. Furthermore, you know about it and can arrange your affairs to profit from it. Huge opportunities are presentedtoYOU.Ifyoustoreyourwealthinpaperandgovernmentbondsyoumaywanttoconsiderchangingyour plansasthereisnoescapefromthefinaldenouement. Bonds and currencies are classic Austrian Malinvestments just waiting to fall to their real value, their value before regulatoryfavoritisminotherwords,beforetheleverageusedtopurchasethemandthathasdriventhemtothese levels, combined with a GLUT of paper money that has been printed to BUY THEM. They must decline to provide a realreturninexcessof10.5%afterreal,asmeasuredbywww.shadowstats.com Would you like to turn this into an opportunity? If you are an investor who wants to diversify your portfolio into AbsoluteReturnAlternativeInvestmentsandhave mehelpyou repairyourpapermoneysoitresistsdebasementby theprintingpress,CLICKHEREandIwillgiveyouacall(http://www.TraderView.com/portfolio/). Anumberofquestionscometomind:ThefirstquestioniswhenwilltheBOMB.er,BondMarketcrashasinvestors WAKE UP to the reality of the paper assets in which they attempt to store their wealth? What prices will Gold, commoditiesandnaturalresourcesrisetoreflectpastandfuturemonetization?Howmuchofyourgainsarenothing morethanyourassetsREPRICING toreflect thelowerpurchasingpowerofwhattheyaredenominatedin?Answer: mostofthem.Howmuchoftheirvalueistheresultoftheleverageusedtopurchasethem?Howmuchwillyoulose ifyourpaperassetsLOSE90%oftheirvalue? In the Eurozone, United kingdom, Japan, Switzerland and all countries which hold dollars as reserves get a double dose of debasement, 1st from the Federal Reserve debasement of their reserve holdings (approximately 60% of Central Bank reserves are US DOLLARS), then again from their respective Central Banks as they debase and carry out quantitative easing. The dollar will be the last to fall as everything is a derivative of the dollar. Also keep in mind thatthedollar,astheworldsreservecurrency,istheonlycurrencyintheworldwhichboththeshortsandthelongs donotwantittofall.Theshortsareprintingitendlesslyandthelongsaretryingtostorewealthinit.Bondauctions
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TedBitsNewsletter:February24,2012 will NEVER fail as success lays just a phone call away to another Central Bank writing worthless checks to buy worthlessbonds. The confiscation of purchasing power Greenspan spoke of is now almost COMPLETE, the final stretch run to worthlessnesswillbeMAYHEMrunwild.PeopleDONOTKNOWwhatmoneyis,howitmustfunctiontobeastoreof value, and move purchasing power through time and space. Currencies DONT FLOAT they just SINK at DIFFERENT rates. Repeatafterme:PAPERisPOISON,PAPERispoison.ItisthefinalBUBBLE.DontmissthenextissueofTedBits2012 Outlook, subscriptions are free at www.traderview.com/subscribe/ . If you missed part one I urge you to read it. Thankyou.
Thank you for reading TedBits. If you enjoyed it Subscribe, it is free: Send it to a friend: For greater insight into the philosophy behind Tedbits, have a look at the Tedbits Overview - To help understand our mission in serving you, the Tedbits Overview gives a broad description of whats unfolding globally and what you can expect from Tedbits as a regular reader.
Ty Andros / TraderView Gold & Silver Backed, Absolute-Return Alternative Investment Specialists
223 West Jackson Blvd., Suite 725, Chicago, IL 60606, PH:. 800.253.7689 // +1.312.338.7800 info@TraderView.com www.TraderView.com
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2012 Outlook Europa Vest Si Sua-Analisti Realisti Nu Mincinosi

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TedBitsNewsletter:February24,2012

TedBitsNewsletter:February24,2012 TheChineseandRussiansaredumpingtreasuriesatarapidrateseeingtheupcomingtrainwreckandtryingtogetoff thetrain,asthischartillustrates(courtesyofwww.zerohedge.com):

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