THE INTERNATIONAL FORECASTER

WEDNESDAY, DECEMBER 16, 2009

121609(5)IF
P. O. Box 510518, Punta Gorda, FL 33951-0518
An international financial, economic, political and social commentary.

Published and Edited by: Bob Chapman

NOTE: NEW E-MAIL ADDRESSES
For correspondence to Bob: bob@intforecaster.com
For subscription and renewal: info@intforecaster.com

CHECK OUT OUR WEBSITE

www.theinternationalforecaster.com
1-YEAR $159.95 U.S. Funds
US AND CANADIAN SUBSCRIBERS: Make check payable to Robert Chapman (NOT
International Forecaster), and mail to P.O. Box 510518, Punta Gorda, FL 33951-0518. Please
include name, address, telephone number and e-mail address.
Or:
We accept Visa and MasterCard charges. Provide us with your card number and expiration date. We will charge
your card US$159.95 for a one-year subscription.
You can email us in two separate emails (1- the Credit Card Number with full name, address and your
telephone number and (2- the Expiration date on the card.

NON US OR CANADIANS SUBSCRIBERS:

Due to the time that it takes for your mail to arrive to us from a foreign country, we would like for you to email us
as above the CC information in two separate emails.

Note: We publish twice a month by surface mail or twice a week by E-mail. bob@intforecaster.com
or info@intforecaster.com

RADIO APPEARANCES:
To check out all of our radio appearances click on this link below:
http://www.theinternationalforecaster.com/radio

NEXT ISSUES
EVERY WEDNESDAY AND SATURDAY DURING THE MONTH OF DECEMBER
EXCEPT NO ISSUE DECEMBER 26TH

Bob Chapman makes regular radio interviews that can be heard over the air or online. Visit The
Bob Chapman Youtube Channel (http://www.youtube.com/user/TheBobChapmanChannel) to
listen to recordings of Bob's broadcasts on the markets, politics, metals, the economy,
currencies, and current events.

Many of the websites linked on this page provide players that allow you to listen to their
programs from within your web browser. Many of them, however, provide links to live internet
broadcasts which may require additional software.
Recommended players:
VLC (Windows download, Mac download)
iTunes (Windows users click “Get Itunes for Windows” near bottom of page)
Windows Media Player (Comes with Windows, Mac download)

**JOIN BOB CHAPMAN ON COAST TO COAST AM WITH GEORGE NOORY**

Bob Chapman will be making an appearance on Coast To Coast Wednesday,
December 16th at 4am EST / 1am PST to talk about the failure of TARP and the
Stimulus to live up their billing.

1
If you're not able to catch the broadcast on one of the many affiliates that carry the
program nationally, stream the show by clicking here.
We want you all to listen to the broadcast or catch the streaming. If you have any
questions or commentary regarding the program send them to
george@coasttocoastam.com

Let them know what you thought of the program.

http://www.coasttocoastam.com/
*****
Discount Gold & Silver Trading Co.
For the best in pricing and service for gold and silver coins, call Melody at 1-800-375-
4188. Be sure to listen to DGSTC with Bob Chapman live on Short-wave 7.415Mhz M-F
4:00PM ET, Replays Tuesday thru Friday 8pm RT 7.465Mhz
3.215 MHz M-F 11PM ET and weekly archives at discountgoldandsilvertrading.net
JOHN STADTMILLER – Republic Broadcasting Network www.republicbroadcasting.org – every Tues. at
5:00-7:00 pm EST
GOLDSEEK RADIO – Every Thursday
SAM BUSHMAN - LRT Radio http://www.libertyroundtable.com
Every first and third Monday of the month 10 am to 11 am
DALE WILLIAMS - Free West Radio Program – http://www.freewestradio.com - Every first Tuesday of
Month
JOHN BRYANT– 7 p.m. EDT - network www.firstamendmentradio.com
Dr. STAN MONTEITH - Every Monday 4 p.m. & 8 p.m. PST. www.radioliberty.com, or to our shortwave
broadcasts on WHRI at 5.745 MH weekdays from 3-5 pm and 8-10 pm Pacific Time 5070 and 7465.
Shortwave: Daily M-F 3:00 - 4:00 PM: PST 5.070 Mhz 4:00 - 5:00 PM: PST 7.465 Mhz 8:00 - 9:00 PM: PST
5.875 & 6.110 Mhz
THE MERIA HELLER SHOW –every 2nd Tuesday of the month – www.Meria.net
THE POWER HOUR– GCN.live.com – Every other Monday in Nov., Dec., and January 4, 2010.
PAT GORMAN – Sunday – November 15, 20009
Stephen Lendman – December 11, 2009
ALEX JONES - GCN.live.com -Noon on shortwave 1st hour: WWCR 9.985 and 2nd & 3rd Hour:
Every Friday – noon CST. WWCR 9975 - Here are some of the recent Alex Jones shows that Bob has
appeared on. Mon thru Fri Noon to 4 pm EST, 12160
http://www.youtube.com/watch?v=JIQ1Qrv_AUE
RAYELAN ALLEN –December 16th - 1pm to 2 pm. [this is to access the ratings for the show]
http://www.talkstreamlive.com/talk_radio/rayelan_allen.stream
[this is the coverage we are getting on YouTube and Clipser, which is
extremely good. You helped make this happen by being subscribers.]
Channel Update's
Youtube
345,158 channel views
1501 subscribers
Clipser
52 subscribers
600,000 views ( seems more people just listening )
Channel Rank on Clipser
1073

RadioAlchymy heard Thursday morning on KPFK 90.7fm Los Angeles with

host/producer Eben Rey.
BUTCH PAUGH – December 16th - 9 p.m. EST - Also on your computer on www.gcnlive.com
<http://www.gcnlive.com/> . LIVE FM STATIONS 9:00 PM EST.-88.3 FM ROTX Campbell, TX- 92.7 FM
Lexington TN-102.9 FM in Lutz, FL-89.7 FM Nettie, WV-89.7 FM North Branch, MN-91.9 FM Kerrville, TX-
97.5 FM Dallas, TX-91.1 FM Austin, TX-97.5-91.1 FM Austin, TX-91.7 FM Fredericksburg, TX-91.7 FM
Johnson City, TX-90.1 FM Round Rock, TX-90.1 FM Austin, TX-96.3 FM Austin, TX-95.7 FM Dallas, TX-

2
93.3 FM Valparaiso, IN-90.7 & 88.5 FM Cosby, TN-88.3 FM Meadsville, PA-100.3 FM Kamia, ID-89.7 FM
Presque Isle ME-97.7 FM Greenville, SC-107.1 FM Oklahoma City, OK-90.1 FM Gatlinburg, TN-102.7 FM
Tampa, FL-KGGM 93.5 FM Delhi, LA LIVE AM STATIONS 9:00 EST.-WIJD 1270 AM Mobile, AL, KIOU
1480 AM Shreveport, LA,WFAM 1050 AM Augusta, GA-WELP 1360 AM Greenville, SC-WCPC 940 AM
Tupelo, MS-WROL 1340 Providence, RI-WITK 1550 AM in Scranton/Wilkesboro, PA-WNNY 1090 AM
Pensacola, FL-WARL 1320 AM Attleboro, MA-1380 WLRM AM Chattanooga, TN-WYYC 1250 AM York, PA-
WNVY 1070 AM Pensacola, FL-KGEZ 1600 AM Kalispell, MT REBROADCAST FM STATIONS- 91.9 FM
Macon, GA 7:00 AM-91.9 FM Freedom radio Jones City, GA 8:00 AM Est. REBROADCAST AM
STATIONS-KCKN AM 1020 Roswell, NM 10 PM Est.-KMET 1490 AM 11 AM Pst. - WASB 1590 AM
Brockport, NY 5-6 PM Est.- WRSB 1310 AM Canandaigua, NY 5-6 PM Est.-WBCR 1470 AM in Alcoa, TN 7-
8 AM Est.-WVOG 600 AM New Orleans, LA 5:00 PM Est.
ERSKINE: - every 3rd Thursday – 2:00 pm CST GCN.live.com
Drew Raines: - Every Thursday 2200 GMT <4pm CST> “A Marines Disquisition”
Carried by BlogTalkRadio & Windtalkers Networks: http://www.blogtalkradio.com/Drew-
Malone-Raines Those of you interested in the latest input concerning the worlds
financial interest and what to do during these times of financial unrest . LISTEN LIVE:
http//www.amd.elequity.com TODAY AND EVERY THRUSDAY we have for your
pleasure Mr. Bob Chapman founder/editor of "The International Forecaster"
http://www.theinternationalforecaster.com 4pm-5pm Chicago time zone USA listen
"Clilck on Thrusday show remains on demand week to week and from the archive
direct link and as "Archives & on Demand" any Thursday Date Mr. of Bob Chapman's
show. All of Bob’s shows are FREE to access, Listen to &/or download ***
http//www.amd.elequity.com see Archives 2nd Hour is Colorado, Al and Drew discuss
the perspective Mr. Chapman brought forth and News & Events around the world and
attacks on our Constitutional Rights to live in Liberty while we grow our Organic Foods
and Herbs for our safety & our health; Live Shows also available on 18 international
phone bridges around the world. Questions for LIVE Show addressed at USA: 347-
308-8047 – .After show times/date Drew can be reached at 501-565-1833 for all
assistance in obtaining archives and Bob’s upcoming shows..
http://www.youtube.com/watch?v=hesYUFCe2_U
GNC-LIVE FREQUENCIES:
http://www.gcnlive.com/Schedule_Shortwave.html
KEVIN GALLAGHER & John McGowan – Every first Friday at 9 pm EST. Time Out Productions -
www.youtube.com/kgallagher01
Bruce McDonald - The Politics of Common Sense: 6-8 p.m. CST
bruce@kickthemallout.com
Pat Gorman – Sunday, 12/12/09
Rob Johnson – on Pappas Telecommunications’ -840 KMPH. Stockton/Modesto, CA
Real With Reuben Torres To listen to the program, go to:
www.blogtalkradio.com/LETSGETREALWITHREUBENTORRES
<http://www.blogtalkradio.com/LETSGETREALWITHREUBENTORRES> An open
forum where topics on politics, immigration, health, education, and other global issues,
that affect our country and the world at large, are discussed and debated at local, national,
and global levels. "Lets Get Real With Reuben Torres "airs every Tuesday evening from
9:00 pm to 10:00 pm unless otherwise noted. - November 17th
Farren Shoaf – Last: November 14, 2009–The Real News Radio
<http://www.talkshoe.com/talkshoe/web/talkCast.jsp?masterId=81009&amp;cmd=tc>
Derek Dreamer – 12/9/09 - 11 am CST –12/09/09 6:30 pm to 7:30 pm CST.
<http://www.blogtalkradio.com/derekdreamer>
Ralph Evans – Sovereign Economist http://sovereign-economist.com - Every
Wednesday starting 9-23-09 from 6:30 pm to 7:30 pm CST. http://texasbroadcasting.net
Jiggy Jag TV James Lowe – Dec. 9th
KJAG Radio

3
http://www.kjagradio.com
Homegrown 1/2 hr on Zoo92.com –-http://jiggyjaguar.com
Guy Chapman – Green T Hour – Every 1st Thursday of each month
http://www.greenthour.com/ - http://www.blogtalkradio.com/Green-T-
Hour/2009/10/02/Green-T-Hour
Here is the link to your show. Please use it as you see fit. Good show Bob
http://www.blogtalkradio.com/Green-T-Hour/2009/11/06/Green-T-Hour
We were talking about gun rights this week and here is the feed for our show with the
NRA if you want to listen it talks about the mayor of New York wanting to take control
of our guns. This guy has really overstepped his boundaries and really needs to be
exposed for being a communist. What can we do about people like this I really don't
know? I have been blogging and trying to expose him.
Here’s the link to your show please use it as you see fit. Thanks for all the hard work
great how and sorry for the tech problems. See ya next month and thanks again
http://www.blogtalkradio.com/green-t-hour/2009/12/04/green-t-hour
James Corbett – December 18th – 9 am EST –

*****
The strongest reason for the people to retain the right to keep and bear
arms is, as a last resort, to protect themselves
against tyranny in government. – Thomas Jefferson

US MARKETS
The past two years have seen the greatest outpouring of money and credit
from central banks and governments in history. In most countries interest rates cannot
fall much lower being presently under 1% or close to zero. You might call this an
attempt at fiat money recovery. As a result of pump priming for the past six months or
more investors have returned to the same gambling and risk taking they engaged in
before, the losses of which caused the world economy to come to the edge of the
financial abyss. All sectors of investment are again affected by a casino mentality.
We see $12.7 trillion donated without their consent of the lender taxpayers to
the top world economies, or about 20% of world GDP. These funds, a good part of
which will never be retrieved, have been stuffed into the pockets of bankers, Wall
Street, insurance companies and GM and AIG. 80% of the problems we have had to
face were caused by these very same entities, which along with the Fed, propose to
solve the problem they created. It is as if they are the only ones in the world who know
best what is good for our system and for us. They as well continue to play in the giant
casino as if nothing ever happened. While this transpires there are still trillions of
dollars in bad debt and impaired assets on the books that have to be written off. The
solution to that is to not truthfully report companies’ financial conditions. If you can
believe this, the Chairman of the Board of the Financial Accounting Standards Board,
the FASB that sets American accounting standards has called for the “decoupling” of
bank capital rules from normal accounting standards. His proposal would encourage
bank regulators to make adjustments as they determine whether banks have adequate
capital while still allowing investors to see the current fair value. In order words it is ok
to have two sets of books and to mark assets to model, which is marking assets to
fantasy. Telling investors the truth is secondary. For almost 20 years banks have had
to use GAAP for the basis for capital rules. If banks had their way there would be no

4
rules. The FASB has been compromised and resides in the back pocket of the
bankers. There you have it. Bankers are more equal than others. Their balance sheets
are worthless. This should not be allowed to happen in America.
At first the G-20 nations wanted to remove monetary stimulus and now they
say it is too early to do so. What they do not tell you is if they did remove trillions from
their economies they would collapse. Europe, the UK and US have losses of $1.7
trillion they haven’t written off of yet. In addition, they have hundreds of billions in
losses for foreclosed loans that are still flowing in, to further befoul their balance
sheets. We have to laugh when central bankers talk about draining trillions from the
system. If they pull liquidity the system collapses. Other than feeding money and credit
into the system the bankers have no solution. Keeping them in charge is like giving a
pyromaniac matches. Even if $500 billion more in stimulus is added to the system from
TARP funds or from Congress, it is only going to keep growth in place until the end of
next year. As a result inflation is going to soar. There is no real recovery. All we have
seen is the Fed pouring trillions of dollars into the US and world economy.
There are two basic schools of thought regarding the economy. One is buying
bonds for safety and the other with virtually no interest money is gambling in the
markets. As a result we have a bull market in bonds and a bear market rally in the
stock market. These factors lead investors and the public to the perception that a
recovery is underway when nothing could be further from the truth. If it was true
someone has to explain to us why consumer spending is off 20% yoy, which makes up
69.3% Of GDP? It is no wonder households are not spending. They have just lost $13
trillion in home equity and the housing bubble still has 20% to go to the downside.
Quantitative easing has been a failure. We are still in a prolonged period of credit
contraction that has been subdued temporarily by massive does of liquidity. Those
hardest hit are small businesses and homeowners. All that retirement money is gone,
because the Fed created a housing bubble. In 2009, homes lost 40% of their value
and they have 20% to go and who knows how long the housing market will bump
along the bottom. Reducing debt and spending is the new mantra. This will certainly
reduce demand and economic growth. Blatant market manipulation in the long run will
not be successful. 2.8% GDP growth is non-existent. The stock market may be
booming on zero interest Fed funds, but as we pointed out last February middle
America is in depression. In order to keep this façade going and the bubble in tact, the
Fed has no choice but to inflate. They want to withdraw funds, but they cannot. They
are recalling TARP funds, which will be quickly gobbled up by a new stimulus program
and a call from the Treasury to buy more Treasuries, Agencies and toxic waste.
Bernanke has to be running around in circles as members of Congress grill him on
poor performance and the House passes HR1207, the Bill to audit and investigate the
Fed. In addition bank lending is off 16.2% yoy and there are no signs of any loosening.
We are looking at object failure by the Fed, which we reflected almost three years ago.
There is no normality and no recovery. You cannot spend your way into recovery. It
just doesn’t work. Look at the 1930s. It didn’t work then and it won’t work now.
Government guarantees challenge reality and reality always wins. As a result of fed
policy we have corporatist fascism at its worst. Day by day we attract less foreign
capital and that is because any semblance of free markets are gone. All the Fed has
done is rescue its owners and other connected elitists and such a plan is doomed to
failure.
We started in the gold markets in 1960. We were the largest gold and silver
stockbrokers of that time. We recommended stocks that ran from $0.25 to hundreds of
dollars a share. It has been 29 years since June 1980 when we exited the market.
Since then these markets have been difficult even though the last ten years have been

5
very rewarding. Had it not been for the powers behind government manipulating the
markets, it would have been far more rewarding. This is what happens when an
uninterested public allows a criminal enterprise to run their lives. Most people born
after 1960 know little about the gold and silver bull markets of the late 1970s. They are
only told of the great bull market we have seen since 1983. Those in their 40s and
younger are about to get an education in how real life works. Not the life created by
Wall Street and the Fed, because that era is about to end and with it the fairy tale life
they have been used too. Gold’s current price of over $1,000 an ounce is only the
beginning. We spent ten years moving from $252 to $1,224. Now the advance is going
to accelerate and could more than double in 2010. It should also be noted that during
this past ten year period the dollar has lost 80% of its purchasing power, which shows
gold is an excellent inflation hedged, as well as a deflation hedge. For the past 6-1/2
years all currencies have fallen versus gold and that is because they have had the
same Keynesian monetary policies as the Fed. As a result gold has maintained its
purchasing power.
It had been fashionable for the past ten years to say gold does not pay interest.
This is the argument Gordon Brown, now UK PM used in 1999, when he sold the
British citizens’ gold at $275.00 and leased a large part of what England had left. That
masterstroke cost British citizens close to $10 billion. He did this when he was
Secretary of the Treasury. Which would you rather have had, 5% interest or a capital
gain of more than 200%? This experience certainly destroys the pays no interest
theory. Owning gold and silver related assets is not speculation; it is wealth
preservation. The great gold and silver bull markets of the last 1970s should have
been seminal events, but they were not. Only 15% of the public participated, the
remainder were buried in the stock market. Over the past ten years it has been worse.
Only 2% to 3% of investors have been involved. In a way that is good, because it
leaves lots more potential buyers to assist in pushing gold and silver higher. This is
why we believe gold and silver have a long way to go on the upside.
There is no question that another bout of inflation is on the way and that the
dollar will continue to fall in value. We do not believe gold and silver are today
reflecting reflation. They are reflecting a flight to quality because professionals and a
minority of other investors have lost faith and trust in the top 20 central banks. Thus,
today we are witnessing a flight to quality and safety. Gold and silver are the only real
way to protect against financial calamity and offer possibilities for profit simultaneously.
If you add in the fact that the US government has been manipulating the gold
and silver prices, you can see the power that they will have to the upside. Wall Street
has known for years gold and silver prices have been suppressed, but that scheme is
about to end. The power of the elitist forces behind government to rig these markets
has been faltering over the past six months. They no longer have the bullion for sale
and are forced to use futures and derivatives to manipulate prices. That lasts for
several days, then it is over, and then prices rise again. If HR1207 and S604 are
passed and the Fed is audited then several months from now we will know exactly
what the “Working Group on Financial Markets” have been doing. Audit will show how
the Fed and the Treasury have rigged these two markets for years. It will also show
how all markets have been manipulated and it will be game over. Gold and silver will
make up for lost time shooting up to their fair values, and even if Ron Paul’s bill is not
passed the influx of investment funds into these metals will eventually overwhelm their
markets. Real inflation since 1980 would see gold between $6,700 and $7,150 an
ounce. Even official inflation would price gold at $2,400 an ounce. People are going to
finally realize that as their purchasing power and investments have fallen in value gold

6
and silver have risen. Two years ago we had real inflation at 14%. We could easily
return to that level in 2010. That cuts a regular stock portfolio in half in five years.
In the pipeline is $12.7 trillion created by our government and the Fed to keep
our economy and financial system from collapsing. There is absolutely no way it can
be withdrawn. The US Inspector General says we are on the hook for potential losses
of $23.7 trillion. These kind of problems and the inflation they caused by the Fed
adding more fuel to the fire will in and of itself force more investors into the arms of
gold and silver. The only things keeping the economy from crashing is government
spending and Fed monetization. We have begun the vicious cycle of inflation again
along with a falling dollar. If you really want to protect your wealth you had best be in
gold and silver related assets. They are the only protection you have.
Revisiting the other side of the equation it should not be forgotten that the Fed
has created out of thin air $1.75 trillion to purchase $300 billion in Treasuries and
$1.45 trillion in toxic waste and Agency securities. All of that money has been
monetized, fed into the system, except that held on deposit by banks at the Fed. Part
of these funds and TARP funds were used to run the stock market up some 54% in six
months. That has only happened six times in 100 years. It is no secret as to why the
stock market rose, but at the same time unemployment rose 22.2%. The Dow is 2,000
points higher than it should be under the circumstances. This is a propaganda setting
to give the illusion that all is well.
We believe that the US dollar will be officially devalued in a year to 1-1/2 years
from now to be replaced with an international trading unit. That will cause another flight
to quality to gold and silver.
One of our contacts in Aussieland has a close contact in Guangzhou, China,
who he has known for a number of years. When our contract told his friend that the US
could default on its debt and devalue a year or more from now. The friend in China
said, a high level Chinese government official who attended a business meeting on
December 7th said the following: 2010 inflation will kick in both in China and the US,
that would make it very bad for business in China and that the Chinese currency would
strengthen to 6 to the US dollar. As you can see America’s problems are going to
affect the entire world.
We continue to see the dollar hit lower lows. Yes, we currently are well aware
of the dollar rally. Another government sponsored rally calculated to keep the rest of
the world’s dollar holders happy and prove the US has a strong dollar policy. If you
looked at the long positions of Goldman Sachs, JPMorgan Chase and Citigroup you
will find that at the end of the third quarter they were very long the dollar, short gold
and silver and the shares. This is another temporary dollar rally and a temporary gold
and silver take down. Next the dollar will be allowed to hit lower lows, ostensibly to
increase the US trade advantage, which is laughable. It could add ½% to GDP at
71.18 and 1% at 65 on the USDX, which is not a solution for the American economy.
Always left out of the reporting is that a lower dollar means higher prices for
commodities and goods imported into the US and considerably more inflation. It will
not encourage more foreign investment, because investors do not know how low the
dollar will fall and it will not appreciably increase job opportunities. Jobs are still moving
offshore to bolster 3rd world economies and to make giant untaxed profits for
transnational conglomerates. Free trade, globalization, offshoring and outsourcing
were created to destroy the economies of the US, Europe and Canada and that is
exactly what has happened and will continue to happen, because our purchased
Congress won’t legislate the solution, which is tariffs on goods and services. We are
well on our way to joining the third world and if you do not let Congress know you know
what they are up too, then you will eventually live in a slum reminiscent of Calcutta,

7
either that or in some US detention camp. The bottom line is a lower dollar is
disastrous for the US economy. The US is being slowly strangled to death. Who wants
to invest in a country that is on the edge of real trouble, plus all the environmental laws
and onerous taxes? Readers, most people do not have a clue as to how bad it is.
Last week the Dow added 0.8%; the S&P was unchanged, the Russell 2000 fell
0.4% and the Nasdaq 100 was unchanged. Cyclicals rose 0.5%; transports fell 0.2%;
consumers fell 0.3% and utilities rose 4%. Banks fell 1.5%; broker/dealers fell 2.5%
and high-tech fell 0.6%. Semis were unchanged; Internets fell 0.3% and biotechs rose
0.1%. Gold bullion ended the week off $47.00 and the HUI fell 5.8%. The dollar rose
0.8% to 76.53.
Two-year T-bills fell 2 bps to 0.73%, the 10’s rose 8 bps to 3.55% and the 10-
year German bund fell 3 bps to 3.21%.
Freddie Mac’s 30-year fixed rate mortgage jumped 10 bps to 4.81%; the 15’s
rose 5 bps to 4.32% and one-year ARMs fell 1 bps to 4.24%. the 30-year jumbos fell
17 bps to 5.82%.
Fed credit declined $19.3 billion to $2.168 trillion. That is down $78.7 billion ytd,
and $73.7 billion yoy. Fed foreign holdings of treasury debt gained $12.1 billion to a
record $2.944 trillion. Custody holdings for foreign central banks expanded at an 18%
rate ytd, up $450 billion yoy.
M2, narrow money supply leaped $22.6 billion to a record $8.414 trillion, up
29% ytd and 4.5% yoy.
Total money market assets added $1.1 billion to $3.320 trillion. They have
declined $520 billion ytd, or 14.1% annualized. They fell $457 billion, or 12.1% yoy.
A record 37.2 million people, or about one out of every eight Americans,
received food stamps in September, as the recession drove a surging jobless rate,
according to a government report.
Recipients of the subsidy for retail-food purchases climbed 18 percent from a
year earlier, according to a statement posted today on the U.S. Department of
Agriculture’s Web site. Participation has set records for 10 straight months.
The government boosted food aid as unemployment soared, heading to a 26-
year high of 10.2 percent in October. The jobless rate cooled to 10 percent last month,
the Labor Department said on Dec. 4.
“We’ve been working to get that money out the door” to families that need
assistance, Deputy Agriculture Secretary Kathleen Merrigan said last week in an
interview.
Nevada had the biggest increase in food-stamp participation rates from a year
earlier, surging 54 percent, followed by a 46.5 percent jump in Utah, according to the
USDA. Texas had the most recipients at 3.1 million, followed by California with 2.9
million and New York with 2.6 million.
Recipients increased in every state and the District of Columbia, except
Louisiana. Because of a sharp rise after Hurricanes Ike and Gustav in 2008, the
number of people in Louisiana getting food stamps fell 65 percent in September from a
year earlier. Gains of more than 30 percent from 2008 were reported in 18 states.
About 35 million people are expected to receive food stamps each month
through the Supplemental Nutrition Assistance Program in the fiscal year that began
Oct. 1, according to the budget that President Barack Obama sent to Congress in May.
“In this economic time, SNAP has been essential,” Merrigan said. The participation
rate of state residents who are eligible for food stamps varies widely, the USDA said
last month in a report based on 2007 data.
In Missouri, about 100 percent who were eligible that year took advantage of
the program, the highest rate in the nation, followed by residents of Maine and

8
Michigan, at 91 percent and 89 percent, respectively, the USDA said. Wyoming’s
participation rate of 47 percent was the lowest in fiscal 2007, followed by California
and Idaho at 48 percent and 50 percent, according to the study.
Nationwide, participation in the food-stamp program was 66 percent of those
eligible for the aid in 2007, the USDA said. The department has budgeted for a rate of
68 percent in the current 2010 fiscal year.
“We know of a lot of people who are SNAP-eligible who are not participating in
the program,” Merrigan said. “We are working with states to improve participation.”
Colonial BancGroup Inc.’s collapse in mid-August could cost the Federal
Deposit Insurance Corp. more than double the amount it originally projected.
Colonial, which was deemed the sixth largest bank failure in U.S. history after
its seizure four months ago, had a current net worth of negative $5.8 billion by the end
of the third quarter. That’s far worse than its original estimate of $2.8 billion to its
insurance fund, according to recent data released by the FDIC.
“It basically says Colonial was a lot worse off than everybody thought it to be,”
said Bert Ely of Alexandria, Va.-based bank consulting firm Ely & Co.
Also, the FDIC possesses more than $4.2 billion of the Montgomery-based
bank’s assets currently in liquidation. However, the FDIC also expects to loss more
than $3.1 billion on those assets, according to a balance sheet posted by the FDIC.
Citigroup Inc. reached an accord with the Treasury Department and regulators
to repay $20 billion of the bailout it received from U.S. taxpayers.
The lender will sell $20.5 billion of capital and debt, the New York-based bank
said in a statement today. The bank will sell $17 billion of common stock, with an over-
allotment option of $2.55 billion, and $3.5 billion of tangible equity units. The U.S.
Treasury will concurrently sell as much as $5 billion of common stock it holds. The
bank said it will also substitute “substantial common stock” for cash compensation.
Chief Executive Officer Vikram Pandit has pressed for an exit from the
Troubled Asset Relief Program to avoid being the only large bank left on “exceptional
assistance,” a Treasury designation reserved for companies including American
International Group Inc. and General Motors Corp. that are surviving on taxpayer aid.
Bank of America Corp. exited last week after paying back $45 billion of bailout funds.
The cost of protecting investors against Dubai defaulting on its debt tumbled
the most since February after Abu Dhabi pledged $10 billion to help the emirate meet
its obligations.
Five-year credit-default swaps on Dubai’s debt fell 115 basis points to 425.5,
according to CMA DataVision prices at 11:40 a.m. in London. The Markit iTraxx SovX
Western Europe index of swaps on 15 governments dropped 4.75 basis points to 62,
according to JPMorgan Chase & Co.
Funds from Abu Dhabi, the capital of the United Arab Emirates and owner of
the world’s biggest sovereign wealth fund, will help Dubai World unit Nakheel PJSC
pay investors the $4.1 billion it owes on Islamic bonds maturing today. State-owned
Dubai World roiled markets worldwide when it said Dec. 1 it was in talks with creditors
to restructure $26 billion of debt.
How about this warning from the Census Department about their ‘estimates’:
The margin of sampling error, as used on page 1, gives a range about the estimate
which is a 90 percent confidence interval. If, for example, the percent change estimate
is +1.2 percent and its estimated standard error is 0.9 percent, then the margin of
sampling error is ±1.65 x 0.9 percent or ±1.5 percent, and the 90 percent confidence
interval is –0.3 percent to +2.7 percent…
Non-sampling error encompasses all other factors that contribute to the total error
of a sample survey estimate. This type of error can occur because of nonresponse,

9
insufficient coverage of the universe of retail businesses, mistakes in the recording and
coding of data, and other errors of collection, response, coverage, or processing.
Although non-sampling error is not measured directly, the Census Bureau employs
quality control procedures throughout the process to minimize this type of error.
We must interject once again that in a severe economic downturn numerous
firms disappear, and this perverts sampling and surveying.
The U.S. Census Bureau announced today that advance estimates of U.S.
retail and food services sales for November, adjusted for seasonal variation and
holiday and trading-day differences, but not for price changes, were $352.1 billion, an
increase of 1.3 percent (±0.5%) from the previous month and 1.9 percent (±0.5%)
above November 2008. Total sales for the September through November 2009 period
were down 2.1 percent (±0.3%) from the same period a year ago. The September to
October 2009 percent change was revised from +1.4 percent (±0.5%) to +1.1 percent
(±0.2%).
http://www.census.gov/retail/marts/www/marts_current.pdf
Please note that the retail sales are seasonally adjusted for holiday and
trading-day – even though every November contains the exact 30 days with 1
Thanksgiving and retailers are open every day!!!
The number of federal workers earning six-figure salaries has exploded during
the recession, according to a USA TODAY analysis of federal salary data.
Federal employees making salaries of $100,000 or more jumped from 14% to
19% of civil servants during the recession's first 18 months — and that's before
overtime pay and bonuses are counted.
Federal workers are enjoying an extraordinary boom time — in pay and hiring —
during a recession that has cost 7.3 million jobs in the private sector.
Goldman Sachs Group Inc. played a bigger role than has been publicly disclosed
in fueling the mortgage bets that nearly felled American International Group Inc….A
Wall Street Journal analysis of AIG's trades, which were on pools of mortgage debt,
shows that Goldman was a key player in many of them, even the ones involving other
banks.
Goldman originated or bought protection from AIG on about $33 billion of the $80
billion of U.S. mortgage assets that AIG insured during the housing boom.
Taylor Bean was shut down by the Federal Housing Administration, citing
possible mortgage fraud. According to people briefed by those winding down Taylor
Bean’s operations, who requested anonymity in order to preserve professional
relationships, there are signs that the company sold some of its loans to more than
one buyer. Lawyers representing Taylor Bean did not return phone calls seeking
comment.
In any event, Ocala says mortgages worth more than half a billion dollars are
missing. And the F.D.I.C. is withholding the release of mortgages worth hundreds of
billions held at Colonial that Ocala investors say are theirs. The government contends
that it is not clear that Bank of America — as a representative for Ocala — paid for
them.
BNP and Deutsche Bank have sued Bank of America in federal court in
Manhattan. Both accuse Bank of America of breaching its custodial and trustee duties
to Ocala. The suits shed light not only on the complexities of the mortgage machine
but on how failsafe mechanisms in these byzantine structures didn’t work. But this
much is clear: The mortgage machine that created so many loans amid the mania
seems riddled with flaws. And until investors are satisfied that those problems have
been solved, the mortgage market is likely to remain in its current depressed state.
The Rasmussen Reports daily Presidential Tracking Poll for Sunday shows that

10
23% of the nation's voters Strongly Approve of the way that Barack Obama is
performing his role as President. Forty-two percent (42%) Strongly Disapprove giving
Obama a Presidential Approval Index rating of -19.
Today is the second straight day that Obama’s Approval Index rating has fallen
to a new low.
Foreign ministers of the Gulf Cooperation Council (GCC) states have reached
agreement on a time frame for the planned Gulf single currency, a Kuwaiti official said
on Monday.
"An agreement has been reached on a time frame for the Gulf single currency,"
by the ministers, said Kuwaiti foreign ministry undersecretary Khaled al-Jarallah, cited
by the official KUNA news agency. He provided no details.
The foreign ministers ended a meeting early Monday to prepare the agenda for
the Gulf annual summit due to start later in the day, where the Gulf monetary union
pact is expected to be launched.
The six-nation bloc has been vying to issue the single currency in 2010 but is
way behind schedule, having failed to hammer out essential technical convergence
preconditions.
In June, four of the six countries -- Saudi Arabia, Kuwait, Bahrain and Qatar --
signed the Gulf monetary union pact, which stipulates the establishment of a monetary
council early in 2010.
The council will eventually develop into a central bank which will take all
necessary procedures to issue the single currency.
Oman withdrew from the monetary union saying it cannot meet convergence
prerequisites, while the United Arab Emirates pulled out after the GCC picked the
Saudi capital Riyadh as the base for the future central bank.
The Federal Reserve, which has more than doubled its balance sheet during
the past 15 months to $2.19 trillion, should consider buying another $2 trillion in assets
to reduce unemployment, Nobel Prize-winning economist Paul Krugman said. ‘Such a
program could do a lot to promote faster growth, while having hardly any downside.’
Krugman wrote… He cited research by Joseph Gagnon, a former Fed staffer now at
the Peterson Institute for International Economics… as ‘the most specific, persuasive
case I’ve seen for more Fed action.
Wall Street Journal (Aparajita Saha-Bubna): “As home loans sour at a rapid
clip, mortgage-finance giants Fannie Mae and Freddie Mac are aggressively bouncing
back defectively underwritten loans to lenders. The result: higher loan-loss reserves for
the lenders and new headwinds for banks trying to escape the housing downturn. For
lenders such as Wells Fargo & Co., Bank of America Corp., J.P. Morgan Chase & Co.
and Citigroup Inc., which are among the largest sellers of mortgages to Fannie and
Freddie, this could mean buying back souring loans at a loss… Through Sept. 30,
Freddie Mac put back about $2.7 billion of single-family mortgages to lenders, more
than double the $1.2 billion of a year earlier.
New budget gaps totaling $28 billion have opened in 36 U.S. states since July
1 as recession-battered tax collections declined and health-care spending increased,
the National Conference of State Legislatures said. The chasm marks the second
consecutive year states will be forced to change course in mid-stream, and will drive
spending to decade-low levels, the conference said… ‘Even if the recession is over,
state budgets are in appalling conditions and are going to be that way for quite a
while,’ Corina Eckl, the conference’s fiscal director, said…” December 9 –
Bloomberg (Michael McDonald): “U.S. state government collections fell 16% to almost
$1.7 trillion in fiscal 2008 from a year earlier, while spending increased 6.2%,

11
according to the U.S. Census Bureau. The biggest drop came in so-called insurance
trust revenue, which slid $377.7 billion, or 73%...”
New budget gaps totaling $28 billion have opened in 36 U.S. states since July
1 as recession-battered tax collections declined and health-care spending increased,
the National Conference of State Legislatures said. The chasm marks the second
consecutive year states will be forced to change course in mid-stream, and will drive
spending to decade-low levels, the conference said… ‘Even if the recession is over,
state budgets are in appalling conditions and are going to be that way for quite a
while,’ Corina Eckl, the conference’s fiscal director, said…” December 9 –
Bloomberg (Michael McDonald): “U.S. state government collections fell 16% to almost
$1.7 trillion in fiscal 2008 from a year earlier, while spending increased 6.2%,
according to the U.S. Census Bureau. The biggest drop came in so-called insurance
trust revenue, which slid $377.7 billion, or 73%...”
No encouraging news on the fiscal front. Third quarter Federal government
Receipts were down 11.2% from a year ago to $2.212 TN SAAR. Federal
Expenditures jumped 12.7% to $3.555 TN SAAR. Compared to three years ago,
Receipts were down 12% while spending was up 29%. State & Local Receipts were
up 0.7% from Q3 2008 to $2.002 TN. State & Local Expenditures were down 1.3% y-
o-y to $2.019 TN.
The situation in California continues to deteriorate despite all the preventitive
measures employed. John Chiang, State Controller, just came out with his most
recent report. In that report, he went into detail as to the current status of the
emergency IOUs issued.
Chiang notes that the IOUs issued between July 2 and September 4, 2009,
totaled 450,000 - worth $2.6 billion. He further reports that they have STOPPED
accruing interest as of September 4th, the maturity date. The interest had been a
rather paltry 3.75% to begin with!
Hurt by heavy investment losses over their last fiscal years, giants CalPers
(California Public Employment Retirement System) and CalSTRs (California
State Teachers Retirement Systems) were affected by downgrades from Moody's, a
highly recognized credit rating agency. Moody's specifically noted the lowered
possibility of these funds to meet future obligations to pensioners.
The two funds together STILL hold a staggering $338 billion in assets despite
losses of more than 25% in their last fiscal years. CalPers remains the single largest
pension fund.
According to the LA Times, the California State University System which
incorporates 23 campuses and 450,000 students, has been subject to budget cuts of
more than $500 million. As a result, "Cal State" has been unable to avoid staff and
faculty furloughs, steep student fee hikes and severe reduction in enrollment.
Currently, according to a variety of analysts, California faces a $21 billion deficit for
the current fiscal year, ending June, 30th. Futhermore, the deficit for the subsequent
two fiscal years is projected to rise to ANOTHER $44 billion!
On the plus side, the news is rather scant. In October, for example, prices of
homes actually up-ticked, although being driven by the Federal tax credit for first-time
buyers. In addition, the state ADDED 26,000 new jobs. So, if these sources are
correct, California is firing teachers and hiring more adminstrators. Talk about the
left hand not knowing what the right hand is doing! Whodda thunk it?

Meanwhile, leading Republican candidates to replace the current governor,

former Ebay head Meg Whitman and Steve Poizner, have offered no solutions to the
fiscal gap on their own. What's a mother to do?

12
 As you can clearly infer, California appears to be entering some sort of "death
spiral". But, fortunately this only represents 1/10th of the population of the United
States!
I hope you find this essay useful and informative. I welcome comments, both
pro and con. I will continue to cover California over the ensuing weeks and months as
new issues surface.
A Pennsylvania staffing company gamed the US visa program by obtaining
hundreds of work visas under names culled from a Mexican telephone directory and
supplying the paperwork to illegal immigrants placed in landscaping and other
seasonal jobs, authorities said yesterday.
“They were almost like a shadow government, because they procured all these
visas, and they were the ones able to control who’s getting them,’’ Assistant US
Attorney Kevin R. Brenner said.
International Personnel Resources Inc. had dozens of clients, many of them
landscapers, builders, and golf courses in the mid-Atlantic. In some cases,
undocumented workers were sent home and given stockpiled visas to reenter the
country and return to their jobs, authorities said. International Personnel would coach
them to tell immigration officials they had never been in the country illegally, according
to the 11-count federal information.
The workers came from Mexico and Central and South America. International
Personnel kept a Mexican phone book at its office in West Chester and used it to
choose names for visa applications, prosecutors said. It accumulated hundreds of the
visas from 2003 to 2008, the government said.
H-2B visas are designed for firms that cannot find Americans willing to work as
seasonal laborers. Given the nation’s cap on H-2B visas, the scheme left fewer
available for companies trying to bring in workers lawfully, prosecutors said.
The International Council of Shopping Centers and Goldman Sachs Retail
Chain Store Sales Index rose 0.4% in the week ended Saturday from its level a week
before on a seasonally adjusted, comparable-store basis.
On a year-on-year basis, the reading rose 2.4%.
The jump came as consumers started to make their final shopping push for the
2009 holiday season, and Hanukkah came earlier this year than last.
"But with consumers still behind last year's holiday-gift buying completion rate,
the industry is poised to have a bigger last-minute surge in holiday-gift buying this
year," said ICSC chief economist Michael Niemira.
Meanwhile, the group still expects December same-store sales to rise about
2% from last year. That follows an unexpectedly weak November.
The International Air Transport Association, or IATA, Tuesday said it expects
the global aviation industry to make a $5.6 billion net loss in 2010, wider than its
previous forecast for a $3.8 billion loss, because of low yields and rising costs.
"The world's airlines will lose $11.0 billion in 2009. We are ending an Annus
Horribilis that brings to a close the 10 challenging years of an aviation Decennis
Horribilis. Between 2000 and 2009, airlines lost $49.1 billion, which is an average of
$5.0 billion per year," Giovanni Bisignani, IATA's director general and chief executive,
said.
However, he said the worst was now behind the aviation industry.
"Demand will likely continue to improve and airlines are expected to drive down
non-fuel unit costs by 1.3%. But fuel costs are rising and yields are a continuing
disaster," Bisignani added.
IATA, which represents some 230 airlines comprising 93% of scheduled
international air traffic, said it expects revenue in 2010 to rise by $22 billion to $478

13
billion compared with 2009 levels, but added that's still lower the $535 billion peak
seen in 2008 and still $30 billion below 2007 levels.
The federal government continued to wind down its bailout of the nation's
biggest banks on Monday, reaching an agreement to eliminate its stakes in Citigroup
and Wells Fargo.
The willingness of banking regulators to strike a deal with the two firms -- both
of which continue to face serious problems -- underscored the eagerness of both sides
to end an extraordinary period of federal support for the financial industry. Banks have
chafed at some of the conditions placed on the federal rescue money, such as limits
on executive pay, while the administration has been criticized for using taxpayer funds
to bail out Wall Street.
All nine of the major banks that took bailout funds in October 2008 have repaid
their federal loans.
Citigroup's departure will come in two phases. First, the company will raise
money from investors to repay $20 billion in government loans as soon as possible.
Then the Treasury Department plans to sell the shares it holds in Citigroup, which it
bought for $25 billion, in chunks over the next year.
The government required Citigroup to replace its federal aid dollar for dollar
with money from private investors, a much tougher condition than was imposed on
other banks, to ensure that the company has enough money in reserve to weather its
problems, a government official said.
Even so, Citigroup's ability to reach an agreement on any terms came much
earlier than financial analysts had expected, and amounts to a significant triumph for
chief executive Vikram Pandit, who had pushed hard to close a deal by the end of the
year. Beginning in 2010, Citigroup no longer will be subject to special federal
supervision, including limits on compensation for top executives.
"We owe the American taxpayers a debt of gratitude," Pandit said in a
statement Monday, "and recognize our obligation to support the economic recovery
through lending and assistance to homeowners and other borrowers in need."
Just hours after that announcement, Wells Fargo stated it would repay its $25
billion in federal aid partly by raising $10.4 billion in a stock offering. Executives
stressed that the company has delivered $1.4 billion worth of dividends to the
government.
Wells Fargo has been one of the most vocal critics of the Troubled Assets
Relief Program. In March, Wells Fargo Chairman Dick Kovacevich accused regulators
of forcing the company to take federal aid and called their approach to rescuing the
financial system "asinine." On Monday, Wells Fargo executives were much more
cordial.
"TARP stabilized our country's financial system when confidence in financial
markets around the world was being tested unlike any other period in our history,"
chief executive John Stumpf said. "Now we're ready to fully repay TARP in a way that
serves the interests of the U.S. taxpayer."
The moves will put pressure on the large regional banks, such as Sun Trust
and PNC Bank, to repay their TARP funds, analysts said.
Slightly more than a year has passed since the Bush administration began the
unprecedented program to shore up the banking industry through direct aid. At the
time, those investments were expected to last three or more years. But Treasury
Secretary Timothy F. Geithner said Monday that 75 percent of the money has been
repaid with a "healthy profit."
The government, however, may see major losses on its injections into
American International Group, General Motors, Chrysler, and their finance companies.

14
 "The United States never intended to be a long-term shareholder in private
companies," Treasury said in a statement. "As banks replace Treasury investments
with private capital, confidence in the financial system increases, government's
unprecedented involvement in the private sector diminishes, and taxpayers are made
whole."
The timing of the deals derives in part from the rhythms of the capital markets,
which begin to shut down for the winter holidays in mid-December. Citigroup needed to
reach a deal with the government now to be sure it could sell the necessary shares by
the end of the year. And Wells Fargo faced enormous pressure once Citigroup's deal
was announced.
Treasury said Monday that it would sell its stake in Citigroup in 2010, beginning
with the sale of about $5 billion in common shares.
Citigroup got more than $45 billion in federal aid in October and November last year.
Treasury later reached an agreement with the company to accept $25 billion in
stock in lieu of repayment of some of that aid, leaving Citigroup $20 billion in the
government's debt.
Citigroup also will end a deal under which the government agreed to limit the
company's losses on a portfolio now containing about $250 billion in troubled assets,
largely real estate and credit card loans, and investments derived from those loans.
The company also agreed to pay bonuses to executives this year with $1.7
billion in stock rather than cash, tying ultimate compensation to the company's
performance over time.
Wells Fargo said it will raise an additional $1.35 billion by issuing stock to the
company's benefit plans in place of compensation that was supposed to be paid to
employees. After the repayment, Treasury will still hold warrants, a contract that gives
the government the option to purchase about 110 million shares of the bank's stock at
$34.01 per share. [As we forecast just two weeks ago; we said TARP money would be
pulled in to be removed from the system. In the meantime the Treasury said they
wanted part of it in the form of Fed buying Treasury paper and the administration
wants the rest for stimulus. If that holds forth there will be lots of inflation in 2010. Bob]
Wholesale prices in the U.S. increased more than anticipated in November, led
by a jump in fuel costs and a rebound in truck prices.
The 1.8 percent increase in prices paid to factories, farmers and other
producers was more than twice as large as anticipated and followed a 0.3 percent gain
in October, according to Labor Department data released today in Washington.
Excluding food and fuel, so-called core prices also exceeded the median estimate of
economists surveyed by Bloomberg News.
Near-record excess capacity and a jobless rate that is projected to average 10
percent in 2010 may prevent suppliers from passing on a rebound in commodity costs
even as the economy recovers. Federal Reserve policy makers, meeting this week,
have said they expect inflation to remain “subdued” in coming months, allowing them
to keep interest rates low.
Factories in the New York region unexpectedly expanded at the slowest pace
in five months in December, indicating manufacturing may provide less of a thrust for
the economy in coming months.
The Federal Reserve Bank of New York’s general economic index fell to 2.6
from 23.5 in November, the bank said today. Readings above zero signal
manufacturing expansion in the state and parts of New Jersey and Connecticut. In
October, the index jumped to 34.6, the highest since May 2004.
Measures of orders, sales and employment all declined during the month.

15
 One in five people who took out federal student loans to attend for-profit
colleges defaulted within three years of leaving school, according to U.S. government
data released today.
The report issued by the Education Department provides a preview of how
colleges may fare under a 2008 law that will require default rates to be calculated over
three years, instead of the current two, starting in 2012.
“We’re hopeful that by providing this three-year information, schools will take a
look and see where they are and see some of the things that they’ll need to do,” Dan
Madzelan, the department’s acting assistant secretary for postsecondary education,
said today in an interview.
Starting in 2014, schools that have had three-year default rates of at least 30
percent for three consecutive years, or 40 percent in any one year, would lose federal
funds under the new law, Madzelan said.
U.S. industrial output rose firmly in November as the manufacturing sector
extended a recovery that economists hope will help turn around the ailing labor
market.
Production climbed 0.8 percent, the Federal Reserve said on Tuesday, well
above forecasts for a 0.5 percent gain. The strides were powered in part by the
automotive sector, and came despite a sharp drop in utility output.
Capacity utilization, the amount of the nation's industrial capacity being put to
use, rose to 71.3 percent in November from a revised 70.6 in October, its highest level
since last December but still well below the long-range average.
The October production figure was revised to no change from an 0.1 percent gain.
If there is one thing we can be sure of as we approach the end of the 2009, it is
that government bonds, having hugely outperformed equities over the past 10 years,
most definitely won't be doing the same again over the next 10. The reason we can be
so confident is that though capricious and volatile on a short-term basis, asset classes
tend to conform to fairly predictable cyclical patterns over much longer time frames.
An extended period of out-performance for one asset class over another will
eventually and inevitably be wholly reversed. The difficult bit is spotting the turn. It is
easy with the benefit of the rear-view mirror to see why things change, but much
harder to see them on the road ahead. Even so, you don't need an expert on the
history of asset markets to realize that the current, 15-year bull run in government
bonds is nearing its conclusion. Indeed, for many countries it has already ended.
The Federal Deposit Insurance Corp. on Tuesday agreed to nearly double the
amount of capital in its 2010 budget used to deal with bank failures and plans to add
more than 1,600 staffers. The agency released a $4 billion operating budget, of which
$2.5 billion has been set aside to fund the takeover of failed banks. The 2009
operating budget was $2.6 billion. "It will ensure that we are prepared to handle an
even larger number of bank failures next year, if that becomes necessary, and to
provide regulatory oversight for an even larger number of troubled institutions," FDIC
Chairman Sheila Bair said in a statement. The additional staff members will be needed
to help the agency unwind failed banks. Many of the new staffers are expected to be
added permanently at a later date.
The US saw a net capital outflow of $13.9 billion in October after inflows of
$127.6 billion in September.
US homebuilder sentiment unexpectedly fell in December. The NAHB/Wells
Fargo Housing market Index fell to 16 from 17 in November.
CapitalOne said annualized net charge-rates for uncollectible debt for credit
cards rose to 9.60% in November from 9.04% in October.

16
 Many major Japanese banks opened bid-only early Wednesday in Tokyo, after
a report that new capital adequacy rules may be delayed by at least a decade. The
Nikkei business daily said in an unsourced report that the Basel Committee on
Banking Supervision has agreed to effectively delay the enforcement of new capital
adequacy rules for large banks, opting to create a transition period of at least 10 years.
The proposed changes include raising the current 8% minimum capital ratio and
focusing on a narrower definition of core capital, the report said.

*****
Is the Worst Over?
This is from a new news service. Take a look.
http://beforeitsnews.com/story/0000000000000973
******
Were the November Employment Numbers Faked?
http://beforeitsnews.com/story/0000000000000979
*****
Chris Horner: Climate-gate e-mails released by whistleblower, not hacker
http://www.washingtonexaminer.com/opinion/columns/OpEd-Contributor/Climate-gate-
e-mails-released-by-whistleblower_-not-hacker-8604302-78098572.html
*****
Climategate: Which one blew the whistle?
http://blogs.news.com.au/heraldsun/andrewbolt/index.php/heraldsun/comments/climat
egate_which_one_blew_the_whistle/
*****
The Real Reason Behind The Copenhagen Walk-Out
http://www.prisonplanet.com/the-real-reason-behind-the-copenhagen-walk-out.html

*****
James Corbett: Carbon Eugenics - Genocide in the name of the environment
http://eclipptv.com/viewVideo.php?video_id=8936
*****
Organized Crime in charge of EU Carbon Trade, Europol says
http://eclipptv.com/viewVideo.php?video_id=8936
*****
Copenhagen stalls decision on catastrophic climate change for six years
http://www.timesonline.co.uk/tol/news/environment/copenhagen/article6955237.ece
*****

UK Group Proposes Using Carbon Offsets to Stop Poor From Breeding

http://www.corbettreport.com/articles/20091209_optimum_population.htm?utm_
source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+corbettreport
_articles+%28Corbett+Report+Articles%29
*****

Climate Science is Dying

Science is on the credibility bubble.
http://online.wsj.com/article/SB10001424052748704107104574572091993737848.htm
l
*****

17
The New Big Lie: Climategate Emails Are Not Significant
http://canadafreepress.com/index.php/article/17916
*****
'Unprecedented Warming'? -
Science Shows Total Fraud
12-14-9

http://www.rense.com/general88/warming.htm
*****
THE JOB MARKET AND THE GREAT RECESSION
The Challenge of Creating Jobs in the Aftermath of ‘The Great Recession’
http://www.mercatus.org/publication/job-market-and-great-recession
*****
Bankers might be feeling public’s wrath — literally
http://rawstory.com/2009/12/bankers-public-wrath-literally/
*****
It’s Time to Leave Afghanistan
by Rep. Ron Paul, December 12, 2009
http://original.antiwar.com/paul/2009/12/11/its-time-to-leave-afghanistan/
*****
Loony Keiser at it again! LOL! Part 1 of 3 on Max Keise TV Channel!
http://www.youtube.com/user/MaxKeiserTV#p/u/0/hjgDcYZ2Ins
*****
Guantanamo Detainee Deaths - by Stephen Lendman
http://sjlendman.blogspot.com/2009/12/guantanamo-detainee-deaths.html
*****
Bernanke's Fake Economic Recovery
by Mike Whitney
http://www.globalresearch.ca/index.php?context=va&aid=16517
*****
Ginnie Mae’s Troubling Endorsements
http://www.truthout.org/topstories/121209ms4
*****
Mega Depression: Howard Davidowitz, Celente say USA broke like Japan &
Zimbabwe
http://www.youtube.com/watch?v=K-BOHhK3CHE
*****
Lord Christopher Monckton
http://www.kingworldnews.com/kingworldnews/Broadcast_Gold+/Entries/2009/1
2/12_Lord_Christopher_Monckton.html
*****
BREAKING VIRAL - America your guns are being taken and YOU DONT EVEN
KNOW IT!
http://www.youtube.com/watch?v=Ni9qyB1pPS8&feature=sub
*****
Winchester to Deliver 200 Million 40-Cal. Rounds to Homeland Security
http://www.gunreports.com/news/ammo/Winchester-ICE-Homeland-Security-
ICE_1460-1.html
*****

18
The Wages of Climategate
http://www.americanthinker.com/2009/12/the_wages_of_climategate.html
*****
US System to Find, Help Victims of Human Trafficking Is Broken
https://www.truthout.org/1213094
*****
Climate Change: What is the Hidden Agenda? Selected articles
http://www.fourwinds10.com/siterun_data/environment/weather_and_climate/ne
ws.php?q=1260714687
*****
Obama Calls for More Leverage and More Debt On Path Towards Financial Ruin
Dec 12, 2009 - 11:56 AM
By: Bob_Chapman
http://www.marketoracle.co.uk/Article15755.html
*****
Small Business Confidence Plunges — Where Will Jobs Come From?
http://blog.atimes.net/?p=1269
*****
Can America Stop The Coming Oppression?
http://peopleforfreedom.com/new-world-order-news/globalism/can-america-stop-the-coming-oppression/
*****
The Return of Gold and Silver Eagle Rationing
http://mintnewsblog.blogspot.com/2009/12/return-of-gold-and-silver-eagle.html
*****
The Republicans' war within
In California, repercussions of one vote by legislator illustrate fractured state party
http://www.washingtonpost.com/wp-
dyn/content/article/2009/12/13/AR2009121303042.html?wpisrc=nl_pmpolitics
*****
The CIA Drug Trafficking in South America
http://disc.yourwebapps.com/discussion.cgi?disc=149495;article=122912;title=APFN
*****
Here is a link that gives a great picture of our unemployment over the last 2 to 3
yrs…

http://cohort11.americanobserver.net/latoyaegwuekwe/multimediafinal.html
*****

Firm cuts hedge funds jobs

Kevin Sherevers
http://www.caymannetnews.com/news-19533--1-1---.html
*****
Gore cites studies predicting polar ice may disappear in 5 years
Earlier warnings put date at 2030
http://www.boston.com/news/world/europe/articles/2009/12/15/gore_cites_studie
s_predicting_polar_ice_may_disappear_in_5_years?mode=PF
*****
Times: Inconvenient truth for Al Gore as his North Pole sums don’t add up
<http://www.infowars.com/times-inconvenient-truth-for-al-gore-as-his-north-
pole-sums-dont-add-up/>
http://www.timesonline.co.uk/tol/news/environment/copenhagen/article6956783.ece

19
 *****

Climate Treaty Would Create New Global Agencies to Transfer Money and
Technology from U.S. and Other Developed Countries to Third World
http://www.cnsnews.com/news/article/58471

Shocker: Copenhagen Climate Negotiations "Suspended"

http://www.businessinsider.com/shocker-copenhagen-climate-negotiations-suspended-
2009-12

If Climategate Is No Big Deal, Why Are Questions About It Met With An Armed
Response?
http://www.infowars.com/if-climategate-is-no-big-deal-why-are-questions-about-
it-met-with-an-armed-response/

*****
Suspension of Berkey Products To California Residents Begining January 1,
2010
http://www.directive21.com/california.html
*****

EMERGENCY: US Army View of PreMillennialism

Strategic Implications of American Millennialism
http://johnmcternansinsights.blogspot.com/2009/12/emergency-us-army-view-
of.html
*****
Temporary Accord Cuts Rents for Many at Two Complexes
http://www.nytimes.com/2009/12/15/nyregion/15stuy.html?_r=1&ref=nyregion
*****
Glock 298 rounds in full auto
http://www.youtube.com/watch?v=kBjUDCyDCuI
*****
The Fed’s Money Monopoly
http://www.24hgold.com/english/printarticle.aspx?pagedest=513536&langue=en
&viewarticle=True
*****
Cap-an-Trade Carbon Credit Extortion Scam in Full Swing
http://www.24hgold.com/english/printarticle.aspx?pagedest=513532&langue=en
&viewarticle=True
*****
CLIMATEGATE - Blog claiming Gore opponents working for Big Oil finanically
linked to Gore
http://pennyforyourthoughts2.blogspot.com/2009/12/from-al-gores-investment-
management-to.html
*****
Celebs to kids: America stinks!
'55 rich white men drafted Constitution to protect their class – slaveholders'
http://www.wnd.com/index.php?fa=PAGE.view&pageId=119046

*****
Savings & Loan MisTrust 700 Billion $ Bailout XPLANED by XPLANE

20
http://www.youtube.com/watch?v=W29FLkF7Qgw
*****
Sparks from Peach Prize-president Kindle Civil War:
http://barcelona.indymedia.org/newswire/display/387464/index.php
*****
Please thank CNBC's Squack Box for having Ron Paul as a co-host for a whole
hour this morning (without much bias/mockery too). Trust me, those producers
ONLY care about ratings and if we show them they do well to host our people,
they will continue to do so.

(Right side of the webpage, under Contact Us: "We Want to hea...r from you!"
http://www.cnbc.com/id/15838368?__source=vty

*****

Gregg v. Paul: Auditing the Fed

http://www.cnbc.com/id/15840232?video=1359416416&play=1
*****
GunPal Ramps Up as Replacement for PayPal on Firearms Transactions
http://www.gunreports.com/news/news/GunPal-Replacement-PayPal-Firearms-
Transactions_1634-1.html
*****
THE TRUE DANGER LURKING BEHIND 0.00% TREASURY YIELDS AND THE 1-3-
6 RULE
http://johngaltfla.com/blog3/2009/12/14/the-true-danger-lurking-behind-0-00-
treasury-yields-and-the-1-3-6-rule-part-i/
*****
Time for an Immigration Moratorium
http://www.humanevents.com/article.php?print=yes&id=34806
*****
From a Fellow Subscriber:
Howdy Folks,

I need a bigger bucket to vomit in. Last Night I heard that the slimes on the LA City
council voted in a 5 year pay increase for the equally slimy people at the LA Dept of
Water & Power! No more policemen, layoffs in their civilian forces...etc. What gives? I
know, they can just raise fees for water and power! I wanna hurl!

I hear Cap and Trade by 2040 will expect 470 million Americans to exist on the
electrical footprint equal to national output in 1907! Or do they think there will be less
people around? I wonder...

Hey does not that fat COLA increase in your Social Security give you hope? How's
that for change?

Plans are to return to nature over 90 million acres of farm land. This will cut our Ag
exports to the bone. We may find ourselves importing food. All in the name of saving
the planet. But will anybody accept our greenbacks for food? By the twitching of my
thumb, something really bad is coming down the chute.

Is BofA being led to slaughter? Ya know the founders started that bank in San

21
Francisco because they got tired of paying economic homage to the New York money
trusts. Even though BofA is now one of the big boys, the NY money mob has a long
memory... Kinds like the Bank of England never forgiving us for that little tiff in
1776...Connect the little dots, or just ask BS & Co, or K&L.

There is a vibe in the gun owning community that it's stock up now on ammo, as a big
move is underfoot to jack up commercial insurance for any retailer who wants to sell
the stuff. Reloading equipment on E-Bay is selling like hotcakes... Do you own a ball
mill? I will soon (Check out United Nuclear on the web) and I can make my own
powder with it. Cap & Ball may have a comeback! I would not wanna get hit by a round
from a Dragoon revolver any more that a Glock Pistol. Actually a double action
Remington would be a fine choice of that flavor of firearm. Besides if things get really
dark I bet gunpowder will make a fab barter item...A side of beef for a 8oz sack of
boom flakes! Time to think outside of the box, or concentration camp.

So how long till the next big run-up in gas prices? Is consumption so far down that they
have a surplus of the stuff? Funny how the price is a few cents of each other between
stations,,, can you spell CARTEL boys and girls?

Food prices seem to have momentarily stabilized, ah yes the last of the grain storage
is being burned through, wait till next spring's meat prices! Between inflation and
devaluation next year, just buying enough food will be a very expensive operation. Get
a couple of guns, ammo for sure, but for God's sake have a S*@$! Load of food in the
pantry. At least a years worth, and buy meat at the meat shop in bulk (2.25 lb instead
of 4.00 plus) and get a drop in freezer. Will still have electricity so use it.

Speaking of electricity, the Feds did a study of the effect of an EMP tuned nuke
exploding over mid America. This kind of weapon is not hard to make, given you can
make H-bombs at all, and could be delivered by a rather dumb missile system. Just
the range to get to the rough middle of the continent at X amount of altitude....Boom!
The effect would take down the entire power grid enmasse in about 1 second. They
stated that 4 years later only about 10% of the grid would be back up, only issue was
that 90% of the population would not be here to see it! The big killer....dirty water from
lack of sewage treatment. Typhoid is still with us and it kills just a well as it always has.
Gee sounds like a good time for a Berky plug! [Insert commercial here]

I know I should be in a better mood; it's Christmas... but man the stuff that lurks on the
horizon.

Been watching episodes of the Twilight Zone and Outer Limits, old B&W ones from the
60's. First thing I noticed was the general assumption of the viewer intelligence being
much higher, compared to today’s fare. Can you spell DUMBED DOWN populace?
Take a look yourself and see. Viewed in that context it will become plain as day to you.

Anyway, Happy Holidays Folks

*****

From a Fellow Subscriber:

Hi Bob:

Well things are steaming along here in SoCal. Got to talking to some fellows eggheads

22
in the special education field at a conference (where I was presenting) a few weeks
ago. They were all talking about keeping their jobs or getting out as they saw the state
as broken. I asked why they felt that way, and they all said it was the funding of
education. But I replied gee is not education one of the top budget items? It was
answered that a lot of that money never left Sacramento, it goes into feeding the
beast. Well that's a shame, but if we all (the ones with a decent teaching education)
leave, who will be there to teach the kids who are left. One gal spoke up and said the
one's worth saving have had the brains to be in families that have already left.

I was not surprised, as I had reached the same conclusion some time ago:

Back in the 50's the state leadership had the foresight to predict a large influx of more
people. So they planned for it with better roads, lots more schools and a state college
system that was the envy of the world. The plan was in depth and well implemented for
about 20 years. Traffic was crazy at rush hour, but you could get to work in an hour if
needed, from the suburbs of most big cities out here. 1984 was in my mind the high
water mark, the Olympics in LA, the schools were still decent, and you could go to
college and get a good career going, not just a job.

What happened? Too many people, to fast. The sad part was the folks coming in did
not have high skills, just strong backs, and many mouths to feed. All of the low skill
entry-level jobs went first and then blue collar jobs, construction followed. The city
proper became like a 3rd world country, and all of the post war boom communities
became flooded with immigrants (Legal and otherwise). Schools were just laid to
waste, as they now had thousands of kids who could not speak English. So naturally
the scores went down and the drop out rate soared. Crack hit the south central and
Meth flooded the suburbs. Entire communities became turf to be contested by rival
gangs of pushers. Each night the Ghetto birds (police helicopters) would hover over
the city. It was the death of California, as we knew it.

Then in 1987 they passed a law legalizing all of the new comers, and guys like B-1
Bob got voted out of office, by Latino office-seekers. Now the new comers could move
up the ladder into factory management jobs and get contractor credentials. Thus
locking in more cousins from the old village back home a job. The influx became
biblical, and housing became more and more scarce, hence expensive. By 1996 when
I went to my 20th high school reunion I was shocked to find well over 60% of my
classmates had moved out of state. Mostly to Las Vegas and Phoenix. Between taxes,
laws, and high costs the feel of the state had changed.
The state that groomed Regan, now gives us Tony Villar and Arnold. Goodwin Knight
and Pat Brown (Senior) weep in heaven over what these fools have done.

So I guess that gal at the conference was right, the smart ones already have left... But
alas to what? Sure other cities in the Sunbelt did great in the 90's and even into the
zips, but look at them now. Like a cancer LAization has hit them too. Some parts have
1 in three out of work.... that’s WORSE that the 30's depression.

When bread costs the same as a gallon of gas at 5 bucks each...look out as the folks
who are here now are lots less compassionate that those who left. There is going to be
a major upheaval, followed by a major contraction of lawful authority. Just look at the
record, when population exceeds resources, population/government adjusts to the
diminished supply. It's a natural consequence that you can bet money on. I think

23
MRE's may just get more valuable than silver. Access and control of clean water will
become the new mother loads.

I think the smartest people will gather their families together. All of them, Aunts &
Uncles, Grandparents, cousins...everybody. Pooling their resources they buy a large
tract of land with water. Plant gardens, orchards, Coops and pens, etc. Build homes
from local materials and include the ability to generate power from wind and solar.
make bio-diesel and methanol for fuel. In other words be ready to unplug from society
when the time comes. Not any one family unit can do this, but a whole village of
relatives have on average the smarts and energy to make it happen. It says in the
bible "Many hands, make for light work". Not to mention the fact that several rifles are
better that one or two. That an thick walls & high fences help. In this case Hillary was
right, it takes a village. Lone Wolfs and rugged alone types get picked off. Either by
lead or sickness.

I think that now it's time for the flocks to be gathered. God gave us this land; we have
squandered it, now God gathers his wrath, as he does not suffer fools for long.

Blessings to You and Yours this Christmas,

*****
From a Fellow Subscriber in the Middle East
Dear Bob,

Just to let you know I spoke to my Mid East contact and I’ll try to break it down as short
as possible.
The Saudi / Israel/US vs. Iran war is on and they think they can strategically take care
of Iran with a carefully planned joint aerial attack. Bunker busters do not need to be
used as the uranium underground is not a target just the delivery systems, which he
implied are in different places. I asked him about the hypocrisy of combining with
Israel to out fellow Arabs. His reply was “They are an uncontrollable variable and thus
they must be taken out to protect the supply of oil”. In addition there is a deep hatred
between the Royals and the ruling Iranian party due to past history. Once the military
is taken out they believe an internal civil conflict will take over due to a repressed
civilian population, which will up and oust the present regime.
Also, they are very pleased with the Dubai fiasco as it seems that Iran has invested
about 40 to 50 billion in that market to hedge their wealth, and have been taken to the
cleaners which further weakens their financial position.
Who knows how this whole thing will unfold, though it certainly makes for interesting
times.
Regards,
*****
From a Fellow Subscriber:
Bob: I've been with the LA County Sheriffs Dept for many years -- Military and police
will not go along with the NWO - most cops are gun nuts, and decent human beings --
they are not going to confiscate guns, ship people to FEMA camps, or follow evil
orders.
The main issue when the US $ and police pension implosion occurs is how they
handle the money --many cops/ military live paycheck to paycheck, and have no other

24
way to earn money. As you know, large departments have been paid off by the feds $$
millions in federal grants -- corruption in management is rampant today--the Chief or
Sheriff will do whatever the feds say. It comes down to how many cops/military will
walk off the job or revolt, based upon what their new paychecks will afford them. I was
out on the street in the middle of the Rodney King riots getting shot at
-- I've seen lawlessness and anarchy -- cops/military will defect left and right if being
paid in IOU's/worthless currency -- maybe that's what the powers to be are planning
on????
*****

Hi Bob-I DO NOT know this—and it is NOT a rumor—but I just had a scary—-

“Epiphany” -as if God spoke to me—as I have watched the data points and fact
pattern—and what I heard in my head is that what the whole— Tiger Woods HONEY
POT --take down—hang out---feeding frenzy is really ALL about is—that he is being
set up-sheep dipped —for some kind of O J Simpson type of SATANIC 3RD PARTY
Sharon Tate type murder of his white wife and 2 white children psy-op that will be done
by—” somebody”—-3RD PARTY—most likely not him—that will lead to a OJ Simpson
type shows trial to incite a race war in America—his womanizing has been going on for
years—both before and during his marriage—zero black woman have appeared so
far—so all this has all been held back UNTIL now—and it looks like a NSA type data
mining type job similar to the Spitzer HONEY POT take down—where— “they”— knew
some other guy bought one of his mistresses an air line ticket TO AUSTRALIA and
paid by credit card—exact financial details stuff like that could never have come from
Tiger or the mistress or his buddy—they would never have INTENTIONLY self
incriminated themselves-INTENTIONLY DESTROYED THEMSELVES like that—they
did a similar SHARON TATE type SNUFF job on DR Jeff Mcdonald MD-who happens
to be Jewish—because he was complaining internally as a US army flight surgeon—
that they were bringing kilo’s type bags of dope from Vietnam sewn into the body
cavities of dead returning US servicemen—so they SATANICLY snuffed his wife and
two children—and hung the whole thing on him-as a triple murder—DR Jeff Mcdonald
MD is still in prison—I HOPE I’M 100% WRONG ABOUT ALL OF THE ABOVE—BUT
IT IS AS IF MY HAIR IS ON FIRE
---FEARING FOR TIGER AND HIS WIFE AND KIDS AND FOR AMERICA—AS PER
YOUR CONSTANT REPORTING IN THE IF AND ON THE RADIO—”THESE
PEOPLE ARE ABSOLUTELY DIABOLICAL”—something really big-REALLY BAD is in
the pipe line via the Tiger Woods honey pot take down.
*****

COMMODITIES
The CRB index declined 1.1% this week (up 18.0% y-t-d). The Goldman Sachs
Commodities Index (GSCI) dropped 2.8% (up 40.2%). Gold sank 4.0% to close at
$1,115 (up 26.4%). Silver sank 7.1% to $17.205 (up 52%). January Crude dropped
$5.73 to $69.74 (up 56%). January Gasoline sank 6.7% (up 74%), while January
Natural Gas surged 12.3% (down 8%). March Copper fell 2.9% (up 123%). March
Wheat declined 3.7% (down 12%), while March Corn jumped 4.1% (down 1% y-t-d).

GOLD, SILVER, PLATINUM AND PALLADIUM

Monday was firm but hesitant. Gold rose $3.90 in the spot market to $1,123.30,
as February rose $8.00. Spot silver rose $0.24 to $17.32, as March rose $0.35. The
HUI rose 5.90 to 499.56 and the XAU rose 1.94 to 174.38. It is only a matter of time

25
before the shorts have to cover in both gold and silver bullion and shares. Last
Tuesday saw the Comex COT commercial shorts increase net shorts by 14,545
contracts to 512646, which is pure insanity. A pro would never do this. It has to be your
government. Open interest only fell 3,795 contracts to 501,857, which a very small
drop considering the drop the preceding week of only 32,000. The only conclusion is
that physical buyers are taking on the government head to head. Nouriel Roubini’s
negative comments on gold shows exactly who his handlers are. We told you long ago
he was a phony.
The Dow closed up 29 to 10,501; S&P rose 70 and Nasdaq 123 Dow points.
The 10-year T-note yielded 3.55. The yen rose .0041 to $.8847; the euro rose .0023 to
$1.4642; the pound rose .0009 to $1.6249; the Swiss franc rose .0008 to $1.0334; the
Canadian dollar rose .0020 to $.9448 and the USDX fell 27 to 76.30.
Oil fell 40.22 to $69.65; gas fell $0.01 to $1.83 and natural gas rose $0.19 to
$5.35. Copper rose $0.01 to $3.15; platinum rose $30.00 to $1,452.70 and palladium
rose $7.35 to $369.56. The CRB Index rose 2.66 to 273.59. The later two metals are
telling us it is time for gold and silver to move higher again.
Gold and gold receivables held by euro zone central banks rose by 1 million
euros to 238.146 billion euros in the week ending Dec. 11, the European Central Bank
said on Tuesday.
Net foreign exchange reserves in the Eurosystem of central banks fell by 1.1
billion euros to 163.4 billion euros, the ECB said in its regular weekly consolidated
financial statement.
Gold holdings rose because of a purchase by one euro zone central bank, the
ECB said. The ECB's balance sheet totaled 1.745 trillion euros, down from 1.759
trillion a week earlier.
Tuesday saw gold early on off $20.00, then off $8.00, then up $9.00 and then
back to spot at $1,122.40, off $0.90, as February rose $1.90. Silver in the spot market
rose $0.12 to $17.44, as March rose $0.09. The HUI fell 9.25 to 440.42 with producers
off $0.15 to $0.75. The USDX currencies took another dip today. The gold news
is that at about 77 the index will run into stiff technical resistance. In all gold and silver
did well. Actually silver performed best. After today traders and technicians have to be
scratching their heads. The professionals know exactly what is going on, the markets
are being manipulated. This has compromised the CFTC and left no trust or
confidence in their ability to be fair and balanced in regulating the commodities
markets. Their false reporting is legion. Today’s gold open interest rose 999 contracts
to 499,898. We are told gold margins are going up again from $4,500 to $5,403 per
contract. This again is an effort to kill gold prices. We have been at this more than 50
years and the Comex has been doing this as long as we have been involved. Siler OI
rose 496 contracts to 122,356. The XAU lost 3.32 to 171.16.
The Dow fell 49 to 10,454, the S&P fell 56 and Nasdaq 66 Dow points. The 30-
year T-note yield rose 4 bps to 3.59. Ten business days ago it was 3.20%. The yen fell
.0124 to $.8959; the euro fell .0115 to $1.4528; the pound fell .0031 to $1,6263; the
Swiss franc fell .0079 to $1.0398; the Canadian dollar fell .0015 to $.9422 and the
USDX rose .58 to 76.92.
Oil rose $1.25 to $70.75; gas rose $0.02 to $1.85 and natural gas rose $0.18 to
$5.52. Copper fell $0.01 to $3.14; platinum rose $3.20 to $1,450.20 and palladium fell
$2.95 to $315.35. The CRB Index rose $0.75 to $274.07.

*****
Federal Reserve manipulating gold prices: Ron Paul

26
http://www.commodityonline.com/news/Federal-Reserve-manipulating-gold-
prices-Ron-Paul-23803-3-1.html

*****
China & Gold: The Big Story
Source: Adrian Ash, BullionVault 12/11/2009
http://theaureport.com/pub/na/3401
*****
The IMF sold Gold plated tungsten bars to India ?!?!?!
http://www.youtube.com/watch?v=M0-hGHJSgNA
*****
NIA Declares Silver Best Investment for Next Decade
http://inflation.us/
*****
Minefinders Consolidates La Virginia District in Sonora-Drilling Planned in Early
2010
http://finance.yahoo.com/news/Minefinders-Consolidates-La-iw-
2523719373.html?x=0&.v=1
*****
An Unbelievable Opportunity in Gold
http://www.theundergroundinvestor.com/2009/12/an-unbelievable-opportunity-in-
gold/#more-1314
*****
The gold bubble myth
http://www.theglobeandmail.com/globe-investor/investment-ideas/features/vox/the-
gold-bubble-myth/article1399184/
*****
CANADA
Canadian household net worth rose in the July-September quarter as
individuals benefited from a rise in stock markets, helping consumers to keep spending
and drive an economic recovery.
The value of families’ assets, such as houses and savings accounts, minus
their liabilities rose 2.3 percent to C$5.72 trillion ($5.38 trillion) in the third quarter,
Statistics Canada said today in Ottawa. Canada’s Standard & Poor’s/TSX Composite
Index rose 9.8 percent in the third quarter, leaving it 21 percent below where it was in
mid-2008.
Canadian industries used less of their capacity in the third quarter than ever
before, but manufacturers had less slack in their production lines for the first time in
five quarters as the economy stabilized.
Industries -- including mines, factories, utilities and drilling rigs -- operated at
67.5 percent of capacity, down from a revised 67.7 percent in the second quarter,
Statistics Canada said on Monday. That was the lowest since record-keeping began in
1987 but stronger than expected largely because of a jump in auto production.
The median forecast of analysts in a Reuters poll was for a a 67.0 percent
capacity utilization rate, based on dismal industrial production data even as signs
emerged that the economy was starting to recover from recession during the third
quarter.
At the same time, manufacturers ramped up their capacity use to 65.6 percent
from 64.7 percent, the first increase in five quarters after automakers reopened some
production capacity shuttered earlier this year.

27
 "Manufacturers of motor vehicles and motor vehicle parts significantly
increased their production to meet rising demand, mostly from the United States,"
Statscan said in a release.
The transportation equipment industry overall -- three-fifth of which is
automakers -- jumped 5.5 percentage points to 53.6 percent capacity utilization.
Bank of Canada Governor Mark Carney’s pledge to freeze record-low
borrowing costs through June may be raising the chances of a bubble in home prices
even as it helps the economy recover from its first recession in 17 years. Sales of
existing houses rose 74% in October from the January low, with prices up 21% from a
year ago to a record C$341,079 ($323,203), partly because of Carney’s promise.

*****
Police State Canada 2010 and the Olympic Crackdown
http://beyourownleader.blogspot.com/2009/12/police-state-canada-2010-and-
olympic.html

*****

EUROPE
Austria will take over Hypo Alpe- Adria Bank International AG and inject as
much as 450 million euros ($660 million), the country’s second bank nationalization
since the start of the financial crisis.
Bayerische Landesbank is selling its 67 percent stake for 1 euro and is
injecting 825 million euros into the company, Austrian Finance Minister Josef Proell
said at a press conference in Vienna, broadcast on the ministry Web site, following
negotiations that lasted the whole night. BayernLB is injecting the money by waiving
receivables, the Munich-based bank said in an e-mailed statement.
Austrian banks, which have granted loans worth 200 billion euros in eastern
Europe, have written down 15 billion euros since the start of the financial crisis in the
second half of 2007, Central Bank Executive Director Andreas Ittner said at a press
briefing in Vienna today. The takeover of Klagenfurt, Austria-based Hypo Alpe-Adria
follows the nationalization of Kommunalkredit Austria AG in November 2008 from
previous owners Oesterreichische Volksbanken AG and Dexia SA.
Hypo Alpe-Adria’s other owners will also inject capital. The Austrian province of
Carinthia, which currently holds 12.4 percent, will inject 200 million euros and Austrian
mutual insurer Grazer Wechselseitige Versicherung AG, which holds 20.5 percent, will
provide 30 million euros.
French President Nicolas Sarkozy’s government will earmark 35 billion euros
($51 billion) for its “Grand Loan” to aid manufacturers such as Areva SA, raising the
bulk of the money in financial markets.
The government will sell 22 billion euros of debt to finance the loan with the
remaining 13 billion euros coming from banks reimbursing the government aid they
received to help weather the country’s worst economic slump in 60 years, Sarkozy
said at a press conference in Paris today.
“This large public and private investment plan isn’t a new stimulus package,”
Sarkozy said. “These are investments that will have consequences for the next 20 or
30 years.”
Sarkozy’s grand loan, which may benefit companies including European
Aeronautic, Defence & Space Co. and jet-engine maker Safran SA, will add to the
country’s debt, which rose to 1.43 trillion euros, or 74 percent of gross domestic

28
product, at the end of the second quarter. Government stimulus spending is boosting
global debt levels and threatening to undermine the creditworthiness of some the
world’s safest sovereign borrowers.
France’s benchmark 3-¾ percent bond due 2019 gained, with the yield falling 3
basis points to 3.44 percent. The premium that investors demand to buy the French
debt over comparable German bond held at 26 basis points. [This is a typical example
of corporatist, fascism. We wonder what the WTO will think of this subsidy?]
The number of people in work in the 16 countries that use the euro fell by
712,000 during the three months from July to September, a slightly larger drop than
the 702,000 recorded in the second quarter.
According to data released by the European Union statistics agency Eurostat
Monday, the number of people with jobs declined by 0.5% from the second quarter, a
rate of decline that was unchanged from the previous three-month period and down
from 0.7% in the first quarter. It was the fifth straight quarter in which employment
declined.
Industrial production in the 16 countries that use the euro fell on the month for
the first time since March, highlighting the fragility of the economic recovery and
suggesting a tough final quarter for the sector, data showed Monday.
According to figures released Monday by the European Union's statistics
agency Eurostat, industrial production declined 0.6% from September and fell 11.1%
from a year earlier. The annual fall was the 18th straight year-on-year decline for this
measure.
The data compared with economists' expectations for a 0.8% monthly drop and
an 11.0% year-on-year fall, according to a Dow Jones Newswires survey last week.
Portuguese annual consumer prices continued to fall in November, marking
nine months of decline on lower prices for food and beverages, data from the country's
National Statistics Institute showed Monday.
Prices, as measured in Portugal's November consumer price index, fell 0.6%
on the year, though they were up a modest 0.2% from October.
Excluding energy and unprocessed foods, prices fell 0.4% from a year earlier,
unchanged from October.
Consumer spending in Portugal has been sluggish this year because of the
effects of the global economic crisis.
On a European-Union harmonized basis, the statistics agency said Portuguese
consumer prices fell 0.8% on the year in November and rose 0.1% on the month.
Swiss Nov Producer and Import Prices flat on month, -3.3% on year
France's balance of payments deficit widened in October to EUR4.5 billion from
a shortfall of EUR4.3 billion in September, the Bank of France said Monday.
The market was expecting a EUR3.8 billion shortfall, according to a Dow Jones
Newswires survey of economists.
For the twelve months to October, the current account deficit of the euro zone's
second-largest economy narrowed slightly to EUR43.8 billion, compared with EUR44
billion in the year to December 2008.
Spanish home sales dipped again in October, pointing to a protracted
correction in Spain's once-booming housing market.
Spanish home sales fell 12% in October from September, after rising a monthly
11% in September. On the year, Spanish October home sales fell by 21%.
In the last several weeks the strength of the Eurozone has been severely
rocked, leading the market to question the sovereign debt risks of numerous EU
states. Ratings agencies last week downgraded their views on Greece and Spain,
judging both economies as more likely to default than previously represented, and

29
questioning the ability of the respective governments to “put things right” in a timely
fashion. Throughout the last decade Spain has been riding the wave of bulging
tourism and demand for property. So highly leveraged in property was the Spanish
economy that when the credit crisis hit, unemployment topped out at a staggering
24%. Unemployment in Spain currently stands around 19% but is largely expected to
rise over 20% in 2010. Prime minister, Jose Zapatero, has made clear his recognition
of the problem, pledging to reduce budget deficit as a matter of priority above other
economic goals. A massive level of unemployment has knock-on effects for
consumer spending, which is expected to drop year-on-year over the Christmas
period. Should a central economy into Europe fall to a similar fate as Greece
(currently in political, social and economical distress), Italy or Spain for instance,
fingers may begin to point to a failing on the Euro and an ill-functioning currency.
Ambrose Evans-Pritchard: Greece defies Europe as EMU crisis turns deadly
serious Euroland's revolt has begun. Greece has become the first country on the
distressed fringes of Europe's monetary union to defy Brussels and reject the Dark
Age leech-cure of wage deflation.
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/6804156/Greec
e-defies-Europe-as-EMU-crisis-turns-deadly-serious.html
Fitch Ratings said Latvia and Lithuania’s sovereign ratings remain under
“downward pressure” as the Baltic states’ economic plight sends their deficit and debt
levels higher.
German investor confidence declined for a third month in December as
analysts became more “realistic” about the outlook for the economic recovery.
The ZEW Center for European Economic Research index of investor and
analyst expectations, which aims to predict developments six months ahead, slipped to
50.4 from 51.1 in November. Economists expected a drop to 50, according to the
median of 33 forecasts in a Bloomberg News survey.
“It really doesn’t signal any trend change from the recovery,” said Aline
Schuiling, an economist at Fortis Bank in Amsterdam. “Germany is still on track to
benefit from the early investment cycle in the global recovery. It’s just that the pace of
the rebound is going to slow down next year after a really strong lift in 2009.”
European stocks have risen for seven of the last nine months on signs the
global economy is strengthening. U.S. employers cut the fewest jobs in November
since the recession began, a report last week showed. While manufacturing in
Germany, Europe’s largest economy, has resumed expansion and the country’s
central bank this month raised its growth forecasts, the stronger euro may curb the
pace of recovery.
The ZEW, which conducted the survey between Nov. 30 and Dec. 14, said its
gauge of the current economic situation rose to minus 60.6 from minus 65.6 in
November. Tat exceeded the 60.1 median forecast of economists.
Wage growth in the 16 countries that use the euro slowed sharply in the three
months to the end of September, contributing to a significant easing in the rate of
increase in labor costs for euro-zone businesses.
European statistical agency Eurostat Tuesday said labor costs in the third
quarter were 3.2% higher than in the same period of 2008, a much smaller increase
than the 4.3% recorded in the second quarter.
Wages were 3.1% higher than in the same period last year, having risen by
4.2% in the second quarter.
Other labor costs--which include taxes on employment paid by businesses--
rose by 3.6%, again a significant reduction from the 4.6% rate of growth recorded in
the second quarter.

30
 Figures released by Eurostat Monday showed that the number of people in
work in the euro zone fell by 712,000 in the third quarter, having fallen by 702,000 in
the second.
That combination of fewer people working and slower wage growth means that
consumer spending in the euro zone is likely to remain weak in the months to come.
That in turn should help persuade the European Central Bank that it doesn't need to
raise its key interest rate soon in order to clamp down on inflationary pressures.
Labor costs rose most rapidly in industry, by 5.4% from the third quarter of
2008. Labor costs in construction rose by 2.9%, while in the services sector they rose
by 2.0%.
Wages rose by 4.5% in Germany and by 1.0% in France, while in the
Netherlands wages actually fell by 0.6%.
Within the 27-member European Union as a whole, labor costs rose by 3.1%
from the third quarter of 2008 while wages rose by 2.9%. In Latvia and Lithuania,
which have been devastated by the financial crisis, wages fell by 3.5% and 11.4%,
respectively.
The Dutch trade surplus in October remained at roughly the same level
compared with the year-earlier period, although both imports and exports continued to
decline sharply, the Dutch bureau for statistics, or CBS, said Tuesday.
The trade surplus came in at EUR3.8 billion from EUR3.77 billion in the
corresponding period last year, CBS said.
The total value of exports in October fell 16% on the year to EUR27.9 billion,
while the total value of imports dropped 18% to EUR24.1 billion.
Meanwhile, the volume of exports in October fell by 6% on the year, while
import volumes dropped by more than 11%.
Switzerland industrial production rises 3.4% in 3Q; above expectations.
Spanish consumer prices rose in November for the first time in nine months
against a backdrop of rising international oil prices, Tuesday data from Spain's
National Statistics Institute showed.
In a statement, the INE said its consumer price index rose in November at a
0.3% annual rate and at an 0.5% monthly rate. In October, Spanish CPI fell at a 0.7%
annual rate and rose at a 0.7% monthly rate.
On a European-Union harmonized basis, November consumer prices rose
0.4% on the year, matching an estimate the INE released Nov. 27.
French consumer prices rose less than expected on the month in November,
the country's statistics office said Friday.
Prices of goods and services in the euro zone's second-largest economy rose
0.1% on the month and by 0.4% on the year, Insee said. Economists polled by Dow
Jones Newswires had expected prices to increase 0.2% on the month and by 0.5% on
the year.

*****

Greece defies Europe as EMU crisis turns deadly serious

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/6804156/
Greece-defies-Europe-as-EMU-crisis-turns-deadly-serious.html

*****

ENGLAND

31
 The U.K. housing market recovery will peter out in 2010 as the supply of
homes increases because of forced sales, Rightmove Plc said.
Average asking prices will stagnate next year after rising about 2 percent in
2009, the operator of the U.K.’s biggest property Web site said in a statement today.
Prices fell 2.2 percent this month to an average of 221,463 pounds ($359,600), and
may drop again next month, the group said.
Banks may show “less forbearance” to consumers who are late on mortgage
payments after the general election, which Prime Minister Gordon Brown must call by
June 2010, Rightmove said. A shortage of properties available helped stoke prices this
year and erased some losses in values caused during the slump, which shaved as
much as 12% off asking prices.
U.K. inflation accelerated more than economists forecast in November to the
fastest pace in six months, driven by fuel and transport costs.
Consumer prices increased 1.9 percent from a year earlier, compared with a
1.5 percent gain the previous month, the Office for National Statistics said today in
London. The median forecast in a Bloomberg News survey of 29 economists was 1.8
percent. On the month, prices rose 0.3 percent.
The inflation rate will rise next year to about 3 percent, close to the upper limit
of the government target, before dropping again, finance minister Alistair Darling said
last week. The Bank of England has kept up spending on its 200 billion-pound ($326
billion) bond plan as it tries to get the rate to the 2 percent goal in the medium term
and stave off the threat of deflation.
“The upside risk is going to intensify over the next couple of months,” James
Knightley, an economist at ING Financial Markets in London, said by telephone.
“There is a risk that we may get a rate over 3 percent by January. What would concern
the BOE is if market expectations of inflation and household surveys rose and that
could make them tighten policy quicker.”
DCLG House Price Index declines 2.2% Y/Y in October.
Retail Price Index increased 0.3% in Nov; 0.3% up on year.
Sentiment in the housing market in England and Wales recovered further in
November, with the proportion of agents reporting rising home prices hitting a
three-year high, the Royal Institution of Chartered Surveyors said Tuesday.
Although the latest monthly RICS survey of housing agents indicates that the
pace of recovery has moderated slightly and optimism about prices and sales has
cooled since October, demand from buyers continues to outpace the rise in the
number of properties being put on sale.
"Buyer enquiries are continuing to grow and with the pace of job losses now
easing, the risk is that the new year could see a further wave of interest in the market,"
Ian Perry, a spokesman for RICS, said in a statement.
The RICS survey's headline price balance, calculated by subtracting the
percentage of surveyors reporting falling prices from those reporting rising prices over
the previous three months, rose to 35 percentage points in November from 34 in
October.

*****
Tullett offers brokers chance to move from UK
http://www.ft.com/cms/s/0/c44dc314-e8a7-11de-9c1f-
00144feab49a.html?nclick_check=1
*****

CHINA

32
 China’s top leaders pledged to maintain a ‘moderately’ loose monetary policy
stance and ‘proactive’ fiscal policies next year to bolster growth in the world’s third-
largest economy. The government will ensure policy continuity, boost consumer
spending and adjust growth models, the official Xinhua news agency reported.
China’s industrial production jumped, exports fell the least in 13 months and
imports surged in November as rebounding trade with Asian nations underscored the
region’s role in leading the world recovery. Factory output climbed 19.2% from a year
earlier… Exports slid 1.2%...and imports surged 26.7%.
China’s passenger-car sales surged 98% last month, the most in at least five
years, as government incentives spurred demand in an auto market poised to surpass
the U.S. as the world’s biggest this year. Sales of cars, sport-utility vehicles and
minivans rose to 1.04 million last month.

*****
China Finds $1.5 Billion Held By Corrupt Officials
http://www.huffingtonpost.com/2009/12/12/china-finds-15-billion-
he_n_389810.html
*****

JAPAN
The Japanese government unveiled a 7.2 trillion yen ($81 billion) economic
stimulus package amid signs the recovery and Prime Minister Yukio Hatoyama’s
popularity are waning.
Japan’s current-account surplus widened in October… The surplus rose 42.7%
to 1.4 trillion yen ($15.7bn) from a year earlier.

INDIA
India’s passenger car sales rose the most in more than five years in
November as cheaper loan rates and economic expansion lifted demand. Sales
totaled 133,687 units in November, 61% more than the 83,121 sold a year
earlier.

LATIN AMERICA
The belated investigation of a 1982 murder in Chile ought to serve as a
reminder that there can be no statute of limitations on fascist thuggery, and that it’s
never too late to pursue justice. So there was both legal and political value to the
announcement this week by Chilean judge Alejandro Madrid that a seven-year inquiry
into the death of former Chilean President Eduardo Frei Montalvo found that he had
been poisoned at the behest of former dictator General Augusto Pinochet’s secret
police.
Six men are under arrest for the murder, including doctors who performed an
autopsy on the former president to remove organs containing traces of the thallium
and mustard gas used to poison him. Frei’s was but one of many political
assassinations perpetrated by Pinochet’s secret police. For Americans, the most
notorious was the 1976 car bombing in Washington, D.C., that killed Chile’s former
ambassador to the United States and an American co-worker.
Those old crimes can teach crucial lessons to Americans as well as Chileans.
As Chileans voted in yesterday’s presidential election - in which Senator Eduardo Frei,

33
son of the murdered former president, was a candidate - they had reason to remember
Pinochet’s 17-year reign of terror. And Americans accustomed to hearing that Chile’s
free-market experiments under Pinochet provide a model worth emulating need to be
reminded of that regime’s criminality - and of US collusion in Pinochet’s destruction of
Chilean democracy.

*****
Leftist LatAm bloc to begin using its own currency
http://www.google.com/hostednews/ap/article/ALeqM5iq0nSIVxMRCKyv0wM_rxBtlrQ_
BQD9CI2OUO0
*****

Billionaire gains runoff in Chile

Leftists must unify if they hope to deny Pinera
http://www.boston.com/news/world/latinamerica/articles/2009/12/14/billionaire_gains_r
unoff_in_chile/
*****

AUSTRALIA AND NEW ZEALAND

The value of commercial finance issued in Australia in October fell 16.3% after
seasonal adjustment from September to A$25.78 billion, the Australian Bureau of
Statistics said Monday.
The fall in commercial finance follows an 8.6% rise in September, the ABS
said. The drop comprised a 14.4% fall in revolving commercial credit and a 17.1% fall
in fixed commercial lending, the ABS said.
A fall of 1.5% in credit for personal finance was accompanied by a fall of 1.9%
in fixed-lending commitments and a 1.2% drop in revolving credit commitments, the
ABS said. Personal credit totaled A$6.95 billion in October.
Lease finance increased by 0.5% in October after seasonal adjustment to
A$383 million.
October retail sales were unchanged percentage-wise when compared with
September, which is a slightly disappointing result. NZD/USD is stagnant this morning
in a .7240/50 range. AUD/NZD is at 1.2575 with support at last week's 1.2530 low.
New Zealand median house prices 0% MoM. That equates to a rise of 5.2% on
the same period last year. The NZD/USD is unchanged this morning compared with
the NY close, currently trading at .7240 with short term support/resistance parameters
at .7220/90.
Australian dwelling comencements in Q3 rose by 9.4% to 34,082 units s/adj.
Forecast was for a reading of+6.8%. A good number but overshadowed by the RBA
minutes.
Australian general government final consumption expenditure rose 0.7% in
chain volume terms in the third quarter from the second quarter, the Australian Bureau
of Statistics said Tuesday.
Public gross fixed capital formation rose 6.2% in chain volume terms from the
previous quarter, the ABS said.
The total number of houses and apartments that started construction in Australia in the
third quarter of 2009 rose 9.4% from the second quarter to a seasonally adjusted
34,082.
Analysts surveyed by Dow Jones Newswires had forecast a rise of 5.0% in the
third quarter from the second.

34
Seasonally adjusted dwelling units commenced
=======================================================
Period Total Number % Change on quarter
3Q 09 34,082 +9.4%
2Q 09 31,154 -1.9%
3Q 08 36,239 -10.2%
=======================================================

The Australian Bureau of Statistics also reported Tuesday that the number of
private-sector houses started in the third quarter rose 8.1% from the previous quarter
to 24,570.
The trend estimate for the total number of housing starts, which further
smoothes the seasonally adjusted numbers, rose 3.2% from the second quarter to
33,008.

*****
Joyce warns of US ‘Armageddon’
http://dprogram.net/2009/12/11/joyce-warns-of-us-armageddon/
*****
Home lending to plummet in 2010
http://www.news.com.au/money/property/home-lending-to-plummet-in-2010/story-
e6frfmd0-1225810015823
*****

HEALTH

Health officials are recalling hundreds of thousands of doses of swine flu

vaccine after tests indicated they may not be potent enough to protect against the
virus.
The Centers for Disease Control and Prevention notified doctors about the
recall Tuesday. The recall involves about 800,000 doses made by Sanofi Pasteur. The
doses are pre-filled syringes intended for young children, ages 6 months to almost
three years.
Health officials recommend children those ages get two doses, spaced about a
month apart.
Health officials say it's not clear how many doses have already been given, but
they don't think children need to be re-vaccinated. The lots passed potency tests when
they were first shipped, but tests indicate the potency waned after.

*****
FIGHTING DIABETIC DISEASE
An area of disease that is flourishing in American is diabetes. Sugar addiction is taking
more victims than death by firearm. We have nearly 18 million Americans (children and
adults) diagnosed with diabetes. The medical experts estimate that there are nearly 6
million people undiagnosed with diabetes and an astounding 57 million on their way to
being diabetics. Every year 1.6 million people get the bad news that they are diabetic.
It won’t be long before 10% of Americans have an official diagnosis of diabetes. Right
now the statistics are split almost down the middle with the number of men and women

35
suffering with diabetes. When the diabetes giant comes-a-callin’ he usually brings
friends; heart disease, high blood pressure, kidney disease, blindness and neuropathy
(nerve damage). We worry about the war on drugs and the war oversees (all good
concerns that need our prayers) however, the addiction to sugar has a death toll
greater than drug addicts or a war between nations.

MORE STATS
The US has 55% of the world market in diabetic medications. Drug companies are
reporting a 25% increase in third quarter earnings for diabetic drugs and medical
devices. Brazil is a strong competitor with a new drug in the diabetic market, with no
generic competitor, and is expected to double the US market share of $500 million.
This is just one segment of the health industry. It isn’t hard to image the huge
consequences when free-market health care is no more. Job loss, quality of care and
accessibility will impact the health and welfare of millions of Americans. We dare not
get a leg cramp let alone a serious disease with a government-run health care system.

HAY ISN’T ALWAYS FOR HORSES

There is an herb known as Greek Hay that has been used since ancient times for
various ills including diabetes. This particular herb, also known as Fenugreek, grows in
almost any soil and has a unique taste similar to celery dipped in maple syrup. The
added benefit of Fenugreek is that it also can help with elevated cholesterol levels
along with the sugar levels. Let’s take a look at fenugreek’s history.

FENUGREEK TIME CAPSULE

Man used fenugreek for sick animals before he used it on himself. The ancient Greeks
used fenugreek in animal feed after they discovered that horses and cows would eat it
before anything else. Even today fenugreek is used to flavor horse and cattle feed as it
encourages sick livestock to eat. This herb was also found in the tomb of King Tut. The
physicians of the Mediterranean discovered fenugreek was a mucilaginous herb. It
has some slippery qualities to it and when mixed with water it soothes inflamed tissue.
It wasn’t long before the Egyptian physicians used fenugreek in ointments for wounds
and abscesses. Hippocrates had similar uses for it. Indian women used the herb to
improve nursing mother’s milk production. You probably guessed that fenugreek was
an herb the ancient military used to heal from battle. Actually, fenugreek was the only
herb on record to be used as a weapon of war. In 66 to 70 A.D. during the Roman
siege on Jerusalem, General Vespasian ordered his troops to use ladders and scale
the city walls. Jerusalem’s defense was to pour boiling water or oil on the invaders.
The secret to crippling this endeavor was that the Jews added fenugreek to the mix,
which made everything even more slippery and the enemy could no longer use their
slick ladders. However, it was the 9th century Benedictine monks who used fenugreek
to treat wounds, fevers, digestive and respiratory ills from their herb gardens that made
it popular throughout Europe. From Europe fenugreek made its way to the New World
and was a mainstay in North America folk medicine. Fenugreek was even a patented
ingredient in the American 19th century medicine for “female weakness” called
Pinkham’s Vegetable Compound. It is said that this natural product, along with others,
prompted competitors to create the FDA and regulate product claims.

STUDIES
The researchers at S. N. Medical College in India found that fenugreek lowered
cholesterol levels by 14% after just one month. They also ascertained that fenugreek
can decrease the risk of heart attack by 28%. Two independent Indian studies showed

36
that the type II diabetic patients, who were non-insulin dependent, who took fenugreek
every day lowered their blood sugar levels. These studies confirmed the animal trials.
Germany’s Commission E (equivalent to the FDA) approves fenugreek use for
wounds. Belgian physicians discovered a mild anti-inflammatory compound in
fenugreek, which would explain the relief from sore throats, wounds and arthritis.

MODERN USES
Fenugreek hasn’t changed and can be used for many of the ailments the early settlers
used it for; sore throat, wounds, boils, arthritis, rashes and coughs. It was also used for
female issues such as menopause and menstruation because of its diosgenin
compound (similar to the female hormone estrogen). Commercially on a large scale
fenugreek is an ingredient in flavoring imitation maple syrup.

MAKE PROGRESS NOW

That old saying, “better make hay while the sun shines” is what we all need to do in
order to secure our health if we can’t cure our attack of government-itis. Based on
ancient knowledge and modern research fenugreek is an excellent herb to have on
hand either to be used by itself or with other herbs for improved action. In some people
with diabetes Fenugreek seems to help them regulate their blood sugar levels. In
others, they may respond better to juniper monosperma berries. Both herbal formulas
are available at Apothecary Herbs. Ask for Diabetic Formula “F” (which contains the
fenugreek) or Diabetic Formula (which contains juniper monosperma). If you want to
use fenugreek to help with cholesterol you can combine it with other herbs designed to
strengthen the cardiovascular system (see Heart/Cholesterol/BP formula). Add the
Pain Formula and Arthritis Rub to your fenugreek for arthritis and wounds that have
pain and inflammation. All of the female formulas at Apothecary Herbs can enhance
the estrogen action of fenugreek. For kidney issues use the fenugreek with the Juniper
Berries. All these formulas you will find at Apothecary Herbs
http://www.thepowerherbs.com or call toll free 866-229-3663. NOTE: Fenugreek is not
for pregnant or nursing mothers. Apothecary Herbs 10th Anniversary Catalog will be
available in January by request only. Call today and get on the list for your copy 866-
229-3663, International 704-875-8010.

SWINE & H1N1 FLU – UPDATE

Breaking news – 800,000 doses of Swine/H1N1 flu vaccine recalled Tuesday.
Media states doses too weak but most of the doses have been dispensed to
children. How do you recall an already administered vaccine? Please visit the
radio archives http://www.thepowerherbs.com/archives.htm for the several interviews
aired on Herb Talk live with Dr. Joseph Mercola and neurologist Dr. Russell Blaylock
(air date beginning 11/5/09). These shows have just posted. You will hear the research
the mainstream media is not publishing on the experimental vaccines. Doctors who
read the scientific neurological data don’t take these vaccines and don’t let their
families take them either. If you want to know what they know, listen to the shows on
the Apothecary Herbs web site under show archives. Don’t let the government make a
criminal out of you because you don’t trust them with your health. You know something
is very wrong when health care professionals don’t want the vaccines either. Just say
no to the flu vaccines.

UPGRADED PANDEMIC KIT

Apothecary Herbs Upgraded Pandemic Kit is designed to strengthen your own
immune system by ten fold and help protect you from swine & bird flu this fall.

37
IMPORTANT: this kit contains two back-up products for a forced vaccination situation
to help draw the vaccine back out and protect the blood system from the virus. These
items have worked well on venomous snake bites, bee stings, poison ivy, brown
recluse spider bite and the tetanus vaccine. If you are forced to be vaccinated you
would use these products immediately after getting the vaccination. If you haven’t
gotten your Upgraded Pandemic Kit from Apothecary Herbs don’t wait too long - now
is the time. To get your
UPGRADED PANDEMIC KIT Call Apothecary Herbs 866-229-3663, International 704-
875-8010 or http://www.thepowerherbs.com each kit contains 8 products for 2 adults
for 10-day pandemic in a travel case for just $175.00. Use dose by weight for children
under 100 pounds (see instructions). Now save 15% with your mail-in order. Call
Apothecary Herbs or see Economic Stimulus discount below.

POWER HERB KIT – contains 13 concentrated herbal liquids for numerous uses and
is a good starter kit and comes in a portable carry case. Call Apothecary Herbs toll free
866-229-3663, International 704-875-8010 or http://www.thepowerherbs.com.

OUR VERSION OF THE ECONOMIC STIMULUS – Apothecary Herbs is offering 15%

off your total order before shipping when you print off your shopping cart order online
or fill out the catalog order form and mail in your order with your check or money order.
Get prepared, healthy and save – what could be better than that? International orders
can send an International Money Order and save 15%. Apothecary Herbs, P.O. Box
918, Huntersville, NC 28070 USA.

CUSTOMIZED YEAR’S SUPPLY OF HERBAL MEDICINE – Stock up with over 90

products designed to protect your immune system, cleanse the body and address what
ails you. NOW SAVE 15% on this package with the STIMULUS DISCOUNT. Call
Apothecary Herbs 866-229-3663, International 704-875-8010
http://www.thepowerherbs.com. Or ask about ordering a customized Year’s Supply for
your particular family needs.

SURVIVAL ITEMS – STAND-UP FOOD POUCHES (CALL NOW AND SAVE 15%)
Order your convenient and compact, dehydrated food in the stand-up pouch for food
emergencies or recreational camping. Light weight food pouches have a long shelf life,
are easy to store for your rainy day food shortages and don’t cost a lot to ship. We
have several meals to choose from in single and double serving sizes to avoid waste.
Mix and serve in the stand-up pouch and avoid the need for extra utensils and
cleanup. Order single serving or double serving meals by the case and for a hot meal,
don’t forget the reusable Flameless Oven for just $13.00. Call Apothecary Herbs 866-
229-3663, International 704-875-8010 or order online http://www.thepowerherbs.com.

HERBS FOR PETS - Dog & Cat Immune Booster Formulas plus Dog & Cat
Congestion Formulas plus toxic-free flea and tick collars, shampoo and spray at
Apothecary Herbs. Call now toll free 866-229-3663, International 704-875-8010 or
http://www.thepowerherbs.com.

Portuguese Sea Salt® - imported from the traditional salterns (a 2000-year tradition)
along the coast of Algarve, Portugal. Salt crystals are harvested by hand and sun-
dried. This is a true artisan sea salt providing richness as well as a smooth and elegant
flavor to food. 1/2 pound ground unrefined Portuguese Sea Salt® just $8.50 at

38
Apothecary Herbs 866-229-3663, International 704-875-8010
http://www.thepowerherbs.com.

#10 CANS SURVIVAL FOOD – call Freeze Dry Guy 866-404-3663 or

www.freezedryguy.com.

*****
NWO Supermarket
http://www.youtube.com/watch?v=f-NPXHSDMmU
*****

Bayer Admits GMO Contamination is Out of Control

Greenpeace International, Dec 8, 2009
http://www.organicconsumers.org/articles/article_19777.cfm
*****
Pentagon's Advice to Traumatized Veterans: Think Happy Thoughts!
http://www.alternet.org/world/144343/pentagon%27s_advice_to_traumatized_vet
erans:_think_happy_thoughts!?page=entire
*****
Monsanto Squeezes Out Seed Business Competition, AP Investigation Finds
http://www.huffingtonpost.com/2009/12/13/monsanto-squeezes-out-
see_n_390354.html
*****
Forced Vaccinations, Government, and the Public Interest By Dr. Russell
Blaylock, M.D. December 2009
http://www.thenhf.com/vaccinations/vac_299.htm
*****

From a Fellow Subscriber:

Dear Bob,

After investigating the following:

1.) Diseases most likely to be involved with the alleged H1N1 Flu outbreak, their
various aspects such as history, signs, symptoms, research, personalities involved
with the different diseases, companies involved with research, press releases, etc. I
have come to the conclusion that this is a very convoluted subject and it is intentional,
filled with lies, half truths and disinformation, non-existent personalities that live at
many different addresses at the same time, professors that start mulit-million dollar
companies(most profs. can not afford to do this). The entire situation is a sham and
anyone with the desire, time and the brains to investigate it could come up with a lot of
interesting information. The problem being is how does one get this info. to the correct
sources? Are there any correct sources? Are you really a correct source? How did
you get out of the NSA, isn't that a very difficult thing to do? You catch my drift. I mean
sometimes I think this whole thing is a game and I am the only one playing it,
everybody else are props. It is up to me to find the TRUTH then I win if I am still alive.

2.) Anthrax spores are the most likely culprit for causing the coming pandemic and
they have been know and studied throughout history, are written about in the bible,

39
killed Alexander the Great, started the Black Death of 1348 when Hannibal catapulted
dead plague corpses over the walls of the city of Kafka in the UKRAINE(no Y. Pestis
did that, as it does not form spores, it was found in places like Iceland that did not have
rats and it was not discovered to be the cause of the disease until 300-333 years later,
just like the Spanish Flu was not found to be the cause of the pandemic of 1918 until
33 years later, there are a lot of 3's in these numbers. Are they trying to tell us
something). If you use Google search and type in the words nanotechnology, bio-
weapons, anthrax all together, you get a BONANZA of information that is very
disturbing(when the USDA puts out articles like this:
http://www.reeis.usda.gov/web/crisprojectpages/213881.html
<http://www.reeis.usda.gov/web/crisprojectpages/213881.html> ). I thought they dealt
with agricultural issues? Blow me over with a feather. Obviously, this technology could
be used for good, more likely these days EVIL. The anthrax terrorist attacks after 911
in this country were caused by nanosized, siliconzied, bioweaponized anthrax that was
made by our government. It was a farce, the American people are not that dumb. But
they are not that smart either, mainly because they have been lied to since birth about
the nature of reality. In additions, this lying has been generational since the beginning
of this time around. They are constantly bombarded by the evil mass media, cultural
pressures and trying to make ends meet for their families in a life that goes at warp
speed. It is no wonder they are not aware and don't want to know anymore. Still I wish
I could find a little assistance here, Oh well I guess it will have to be an exercise in
futility on my part, but an interesting one none the less.

3.) I am starting to believe that a lot more people, especially at Universities are very
involved in all of this, especially in the fields of medicine(both human and Veterinary).
How unfortunate to think I looked up to and respected these people at one time. I
have to admit that I really never wanted to be here on earth there was just something
going on I could not understand and did not like. The only problem is there are not
many of us around that are willing to admit it. What do you REALLY think is going to
happen. I am sure you have your own opinion. Mine is that it will all be over shortly
and this was all an experiment in evolution, not to blow my own horn, but I think I did
pretty good as I really changed and learned and grew a lot as a human being. I still
have more growing to do but there is still a little time left. Even though I would like to
save the world with some of the things I know I am realizing that I am not GOD and he
has other plans for each of us. We are all on our own special journey's. Now I have to
clean my kitchen as I have neglected it for several days. I having been researching the
Plague that is to come. I would be very interested in your honest opinion about all this
stuff, the philosophical stuff too..
*****

From a Fellow Subscriber:

Hi Bob & Judy,

Here is a letter I sent to the EPA just yesterday. I am so sick & tired of Bills & Laws &
Regulations being jammed down our throats. So, I sent off this letter (see below) and I
hope you enjoy it.

I just can't believe you are trying to take more of our freedoms away from us as "WE
THE PEOPLE" and in slave us to do your dirty work. Haven't you been listening to
current affairs, like "Climategate". "Climategate" should have put a nail in the coffins of
the Nazi/Communistic take over of this country and you are the participants of that

40
take over. You have not a clue on what you are saying, let alone believe in what you
are peddling. You should be arrested for Treason. I do believe each and everyone of
you need to go back to school & retake your science classes on CO2( you must be
part of the no child left behind crew or too big to fail group not to know science) and
other elements you are accusing us of destroying God's Green Earth. Oh by the way,
do you remember who GOD is. He is our Creator and I think he knows exactly what
he has been doing for many, many & many years. Unlike you who has not a clue on
what you are doing & saying. The EPA shoud be dismantled. You have once again
shown contempt to GOD & Country. You want more taxes, you pay for the tax out of
your own pockets and keep your crummy hands out of the citizenry pockets.

This letter should tie their stomachs in knots or possibly put me on their hit list for
mentioning God & Country. Enjoy your weekend.
*****
From a Fellow Subscriber;
Health Care: When I sent you the e-mail yesterday about that young child being afraid
of the screen. I forgot to tell you that on Thursday Dec. 3 my husband had
phenomena. The doctor at Yavapai Hospital took the blood test and x-ray. His only
concern was that his whit blood count was 2.5 but stated Oh the x-ray came out
nothing. Of course that was good news to my husband. But the doctor failed to do a
CT. If he did he would have detected different. So on Saturday night he got worse. My
husbands own doctor wanted him to go the Hospital. He refused, but I did not give him
a choice and he did go Sunday. Come to find out my husband lower left lung as will as
his Right lung was totally collapsed. What the meaning behind my story is that the
government is already implementing the health care. Also, on Thanksgiving weekend,
my oldest son and family came for the late thanksgiving dinner. I buy all my foods at
the health food store. But I forgot the biscuits, so I went to the store to buy some. I was
surprised but not surprised to read that under the ingredients was fluoride.
*****
From a Fellow Subscriber:
Hi Bob,

Here is a simple remedy for when Pigs Fly Flu from Dr. Mercola.
http://articles.mercola.com/sites/articles/archive/2009/12/15/Baking-Soda-Used-to-
Treat-Swine-Flu-85-Years-Ago.aspx

Overlooked 150 Year Old Household Cleaner a Remedy for Swine Flu?
Posted by: Dr. Mercola <http://articles.mercola.com/members/Dr.-
Mercola/default.aspx> <http://articles.mercola.com/members/Dr.-
Mercola/default.aspx>
December 15 2009 | 51,910 views

In today’s modern world of medicine the FDA just will not let companies that sell
products make medical claims about them unless they have been tested at great
expense, and approved as a drug. But this was not always the case.

In a 1924 booklet published by the Arm & Hammer Soda Company, the company
starts off saying, “The proven value of Arm & Hammer Bicarbonate of Soda as a
therapeutic agent is further evinced by the following evidence of a prominent physician
named Dr. Volney S. Cheney, in a letter to the Church & Dwight Company:

41
“In 1918 and 1919 while fighting the ‘Flu’ with the U. S. Public Health Service it was
brought to my attention that rarely any one who had been thoroughly alkalinized
with bicarbonate of soda contracted the disease, and those who did contract it,
if alkalinized early, would invariably have mild attacks.”

Recommended dosages from the Arm and Hammer Company for colds and influenza
back in 1925 were:

• During the first day take six doses of half teaspoonful of Bicarbonate of Soda in
glass of cool water, at about two hour intervals
• During the second day take four doses of half teaspoonful of Bicarbonate of
Soda in glass of cool water, at the same intervals
• During the third day take two doses of half teaspoonful of Bicarbonate of Soda
in glass of cool water morning and evening, and thereafter half teaspoonful in
glass of cool water each morning until cold is cured.

*****
MORE FLUORIDE LINKS !
http://www.thenhf.com/fluoridation.html

*****
Drew’s Tips for Fellow Citizens & Patriots

SAVE this and MAKE a HARD-COPY for your files

in case you need to refer to it someday.

1. Do not sign the back of your credit cards. Instead, put 'PHOTO ID
REQUIRED.'

2. When you are writing checks to pay on your credit card accounts, DO
NOT put the complete account number on the 'For' line. Instead, just put
the last four numbers. The credit card company knows the rest of the
number, and anyone who might be handling your check as it passes through
all the check processing channels won't have access to it.

3. Put your work phone # on your checks instead of your home phone. If
you have a PO Box use that instead of your home address. If you do not
have a PO Box, use your work address. Never have your SS# printed on
your checks. (DUH!) You can add it if it is necessary. But if you have It
printed, anyone can get it.

4. Place the contents of your wallet on a photocopy machine. Do both sides

of each license, credit card, Military ID, etc. You will know what you had in
your wallet and all of the account numbers and phone numbers to call and
cancel.. Keep the photocopy in a safe place. Remember with a copy
of your ID’s you can walk into any drivers license bureau or Base
S-1 and get a temporary Military ID, and if overseas, have your
Copy faxed to the Embassy “Visa Division” and report tot them
They’ll get you a NEW PASSPORT within 1 day.

42
 Carry a photocopy of your passport when you travel either left home or
abroad. We've all heard horror stories about fraud that's committed on us
in stealing our Name, address, Social Security number, credit cards etc..

Unfortunately, as a Marine Security Guard I have first hand knowledge because

Of my foreign Duty status in 7 Nations around the World. Recently a former
Marine contacted me with his horror story that his wallet was stolen. What
am I to do? Within a week, the thieves had ordered an expensive monthly
cell phone package, applied for a VISA credit card, had a credit line approved to
buy a Gateway computer, received a PIN number from DMV to change his
driving record information online, and more. HE Finally Called me.

Here' s some critical information to limit the damage in case this

happens to YOU or someone YOU LOVE, or you know:

5. We have been told we should cancel our credit cards immediately. But
the key is having the toll free numbers and your card numbers handy so
you know whom to call, thus the reason for photo copy.
Keep those where you can find them.

6.. ALWAYS File a police report immediately in the jurisdiction where your
credit cards, etc., were stolen. This proves to credit providers you were
diligent, and this is a first step toward an investigation even if you’re abroad
(if there ever is an investigation, as you all know… bankster don’t give a dam).

But here's what is perhaps most important of all:

(Many people even lawyers never even thought to do this.)
(Since you’re in the wwb-system with a credit card YOU SHOULD)

7. Call the 3 national credit reporting organizations immediately to

place a fraud alert on your name and also call the Social Security fraud
line number. I had never heard of doing that until advised by a bank that
called to tell me an application for credit was made over the Internet in
my name.

The alert means any company that checks your credit knows your
information was stolen, and they have to contact you by phone to
authorize new credit..

By the time I was advised to do this, almost two weeks after the theft,
all the damage had been done. There are records of all the credit checks
initiated by the thieves' purchases, none of which I knew about before
placing the alert. Since then, no additional damage has been done, and
the thieves threw my wallet away this weekend (someone turned it in). It
seems to have stopped them dead in their tracks..

Now, here are the numbers you always need to contact

about your wallet, if it has been stolen:

43
 A.) Equifax: 1-800-525-6285

B.) Experian 1-888-397-3742

(formerly TRW)

C.) Trans Union : 1-800-680 7289

D.) Social Security Administration (fraud line):

1-800-269-0271

Pass this to your friends and family

I’m sending this to ALL former Marines and fellow Marine Para-Legal’s & Lawyers I
Trust
And to all my friends in honor of “Kate” who I failed to provide all this knowledge to.
And to many of the sons of my fellow Marines who are now in harms way.
***ITS NEVER TOO LATE TO REPORT - REPORT THE LOSS***
This is the first day of the Rest of your life, protect yourself while you can

Semper Fi,
Drew Malone; Raines III
2009

44