Survey: More Than 25% of Americans Have No Emergency Savings

While nearly half of Americans don't have enough money saved to cover emergencies, one-quarter don't have any money saved, according to Bankrate.com's Financial Security Index survey. The general rule of thumb is to have enough cash saved to cover at least six months of expenses.

However, only 25 percent of Americans have saved that amount and 17 percent have three to five months' expenses saved, while 28 percent have no emergency savings and 21 percent have less than three months' expenses saved. Those earning more than $75,000 annually have higher odds of saving six months of expenses. Only 9 percent of these high earners don't have emergency savings versus 52 percent of those earning less than $30,000.

Among retirees, 41 percent have enough money saved to cover at least six months' expenses, while 26 percent have less than six months' expenses saved and 18 percent have no savings. In addition, 41 percent of college graduates report having emergency savings compared with 14 percent of those with a high school education. According to race, 23 percent of white Americans have no emergency savings compared with 38 percent of nonwhite individuals. Read more >> 

Whatever Happens, Commodities Win: Jim Rogers

Following Friday’s disappointing jobs data and a big jump in Chinese inflation over the weekend, Jim Rogers, the CEO and Chairman of Rogers Holdings, told CNBC that no matter what happens to the global economy, he will make money with his commodity positions.

“If the world economy gets better, I earn money on commodities. If the global economy gets worse then they will print more money and I will make money in commodities,” Rogers said in an interview with CNBC on Monday.

With the commodities market [cnbc explains] highly correlated with the greenback in recent months, Rogers said he is also long the dollar.

“I am long the dollar Euro as everyone was bearish. So I am long the dollar. In five years I may not be not be long the dollar but I am now. The dollar and commodities do not have to move in correlation despite what you see on CNBC,” Rogers said. More...

How we can take stolen profits back from banksters

Image via WikipediaAll of our money comes from debt to private banks -- banks that try to make it look like governments are at fault for their countries falling so heavily into debt. The truth is that banks take the profits that could have been used to better maintain the society if only the people's money was issued by governments through state-owned banks, as was the case, for a time, in both Australia and the US.

What private banks have set up is actually the world's largest pyramid scheme, in which new people must always be going into debt in order that others obtain the currency they need to function within the economy. Within such a system, total indebtedness must continue to increase in order to provide the money that people need in an ever more productive society. More...

I have never witnessed a market so blatantly manipulated as gold on the Comex

jsmineset.com

Hi Dan,

I hope you are well. I am simply writing you today to vent. I own gold. It is insurance. It affords me peace of mind. But I’m also a speculator. I own futures options and mining shares. As of today, I quit.

I’ve been a licensed rep for my entire adult life, almost 20 years. I have never, ever witnessed, on a daily basis, a market that is so blatantly manipulated as gold on the Comex. Furthermore, the manipulation takes place so publicly in the clear light of day, agents of the Fed and the Treasury act to systematically blunt all natural market forces. This happens in America, for the love of Pete!! Additionally, willing accomplices in the financial media carry the water for the criminal manipulators with their daily cause-and-effect market musings to the uninformed masses who fail to recognize the obvious verbal contradictions from one report to the next.

- 5/11-14: Euro collapse. Buy Gold. (while Goldman and JPM sell theirs to dupe algos and hedgies).

- 5/17-18: Euro collapse. Sell Gold. (while Goldman and JPM sell more to paint the tape and create "resistance").

Yes, I suppose it is time to quit trying to profit from gold. As Jim consistently maintains, gold is insurance, period. It is not a trading vehicle.

For the sake of my sanity, I’m taking his advice.

CIGA Craig

Hello Craig,

Trading any rigged market is almost impossible unless you become a one minute bar chart oriented trader and go with the flow on any given day. The problem becomes that you are then trading purely as a technician and attempting to compete with the algorithm and high frequency trading crowd which own the playing field. You can take a few points out of the market doing that but you are then basically a scalper.

I personally do not trade any market based solely on technical indicators because I never made any money doing that my entire career and figure there is no point in trying to start now!

The only way to trade gold in my opinion is to buy it on weakness and sell it on strength. You can make money if you do that. You understand the reason why gold will move higher have not changed and that the selling by the banks is merely a gimmick that is used to flush out the spec longs who buy the market while it is making all time highs.

Wait for the specs to get flushed, watch for signs of a bottom and then buy it with a definite risk level that you are comfortable with.

Again, this is HUGELY different than holding gold as insurance against the depredations of the banking scum and their pals in the monetary sector. That is your insurance and you do not trade it – you accumulate it on bouts of weakness and can then thank the damn fools who are throwing theirs away at the bottom of a price reaction.

Gold is becoming the currency of last resort and that it not going to change because a Central Bank floods a system with liquidity and makes money available. The effects of this compounded increase in the amount of money in the system are going to be felt in an inflationary outbreak down the road. You will be glad you own the metal then.

I personally think that the more the price riggers jack with the system and play games in the paper market, the higher the price is eventually going to go. The harder you press down on a spring to compress it, the more fiercely it uncoils.

Nearly any astute investor OUTSIDE this country now knows that the paper Gold market is being rigged by the US government and its pals at the bullion banks. They are using that to their advantage as the short sighted fools of the West cede any economic advantage to the rising powerhouses of the East. Whoever owns the gold will rule the world. It really is that simple.

There really is something about gold that people can understand who are watching their currencies implode. No amount of bullion bank chicanery and official sector theft is going to change that. Gold is real money and always will be in the minds of the public, even though a war against it has been waged for three decades in the West.

Best to you,
Trader Dan


Jim Sinclair’s Commentary

I would like to add my voice to this quote from Trader Dan.

It will be the various Goldmans that will make the most money in gold after picking the trader’s/scalper’s pockets dry.

"I personally think that the more the price riggers jack with the system and play games in the paper market, the higher the price is eventually going to go. The harder you press down on a spring to compress it, the more fiercely it uncoils."

Sovereign Debt Default: No Time Like the Present

Bill Bonner
While the markets are hot, the economy is cool. Nearly 7,000 people go bankrupt every day – a record number. And in March, M3, the broadest measure of the money supply, recorded its biggest drop ever.

And get this. Peak to trough, December ’07 to February ’10, 8.3 million jobs were lost. As we reported yesterday, take away the statistical tricks and the number of people with real jobs actually fell last month – despite reports of an additional 163,000 new jobs in March.

Consumer credit fell again in February – down $11 billion. To put this number in perspective, the US government has run about $2.5 trillion in deficits since the correction began. So, in spite of pumping monthly deficits on the order of $120 billion…consumer credit still sank by $11 billion.

What can we say? It’s a Great Correction, after all.

Greece is going broke after all. Yields on Greek debt rose over 7% yesterday. So let’s look at how this works. Investors worry about a default. They push up yields (they need higher interest payments to justify the risk). This causes Greece to go further into debt (the cost of paying the extra interest), which causes even more worry among lenders.

Why doesn’t Greece just cut expenses?

Ah…glad you asked. This just goes to show what a dead-end debt can be. The government has already proposed substantial cuts. But it has to answer to the voters – who are on the verge of rioting in the street. And its own cabinet ministers are calling the Germans ‘racist’ because they refuse to give the Greeks money.

It’s hard for a popular democracy to cut spending. And then when it does, it discovers that it is in another trap. So much of the private sector depends on government spending that, take it away, and the whole economy shrinks. This causes tax revenues to fall by more than the budget cuts. In other words, a multiplier works in the other direction – causing the budget deficit to widen when cuts are made!

And guess what? Greece is not the only government that is falling into this hole. Latvia. Iceland. Maybe Ireland, England, California…and even the US…

Where, exactly, the point of no return lies, we don’t know. But it’s out there somewhere…

What’s the solution? Well, just to bite the bullet. Make the cuts. Default. Be happy.

Regards,

Bill Bonner
for The Daily Reckoning

Greece bailout means QE to infinity; Gold to $1650

Image via Wikipedia

jsmineset.com/
Greece will fail and be rescued is all that is discussed in the financial world. Here is the real skinny:

1. Greece getting bailed out means QE (printing of money) to infinity. That means gold would rise from here to $1650 by January of 2011, or as Martin Armstrong said, by June of 2011. The dollar would fall. Equities and commodities would rise.

2. Greece getting flushed means that would enrich the CDS OTC derivative tool. Immediately the next target currencies will be attacked by this tool. Currencies will fall like dominoes. At first the dollar will strengthen, equities will fall and gold will go lower. However, soon the recognition will come that a disaster has occurred that is more serious than the Lehman flushing. Confidence in currencies will fall everywhere. Gold will then rise not to $1650 by the same time in 2011 but to $5000 and perhaps beyond.

Either way both paved the road to a single virtual reserve currency and a single Central Bank (IMF) of Central Banks.

If Greece is bailed out it will take longer for the establishment of the single virtual reserve currency. If Greece is flushed it will happen so fast you will lose your breathe.

Either way I see gold as the only reliable fundamentally correct safe harbor. Gold will play a part at a very high price with the single virtual reserve currency in order to keep gold from being a competitor with it.

Gold’s role will be in the form of the Federal Reserve Gold Certificate Ratio, not tied to the dollar, but rather tied to the single virtual reserve currency in a ratio to a measure of world liquidity. There will be no interest rate automaticity to the new form for gold’s role in a monetary system. It will follow the many articles I have written on the FRGCR but not tied to the dollar but rather the single virtual reserve currency.

Gold will not be fixed or convertible but will trade within a market as a close band of the price gold is trading at when the single virtual reserve currency is created and will lend to this construct some real validity.

I do not favor any of this, but it will occur.

There is no other possibility to this unprecedented calamity at hand.

Respectfully,
Jim

Harrods Department Store Selling Gold Bars

Image by Getty Images via Daylife

James Hall
It is renowned for its glitzy clientele and upmarket Knightsbridge location, but shoppers at department store Harrods will from today be able to buy the ultimate luxury accessory – gold bars.

Aimed at private investors, the gold will be sold at the Harrods Bank branch on the lower ground floor of the West London store.

Poor interest rates and falling property prices have left wealthy investors looking for alternative asset classes to put their money into. A weak dollar yesterday pushed the gold price to a record high of $1,072 an ounce.

Chris Hall, Head of Harrods Gold Bullion, said: "The financial environment has kindled a new demand for physical gold among private investors in Britain. For many people this is a new and unfamiliar asset class that demands absolute trust. Until now London has had no well-recognised name serving this market."

"Harrods saw the opportunity to help individuals buy physical gold in a prudent manner."

Mehdi Bakhordar, managing director of PAMP, said: "Harrods stock our full range and are now the only location in London where investors can purchase a 12.5kg gold bar 'off the shelf'."

Harrods, famed for its gold and green livery, has never sold bullion before.

The CIA and "Masters of Gold"

This from ZeroHedge:

The CIA Chimes In On Gold Control; Highlights Historical Gold-To-Foreign Holdings Shortfunding

After yesterday we highlighted a declassified document by the Department of State, in which it was made clear just how critical it is for the US to remain "Masters of Gold", today we present a comparable memorandum from the same time period (December 1968) this time by the CIA, which presents comparable key high-level gold-related deliberations by the then-administration.

Some of the key points:

We lose influence in world affairs whenever:

• The dollar is weak in exchange markets
• There is a major outflow of gold; and/or
• We are obliged to pressure countries into holding dollars or giving us payments assistance

Our position can also be improved by action on the international monetary system itself to:

• Decrease vulnerability to confidence crises
• Increase world monetary reserves (liquidity); and
• Improve tools for adjusting payments surpluses and deficits

With $33 billion of foreign dollar holdings ($16 billion in official hands) and only $10.7 billion of gold in the U.S. reserve, the risk is clear. To contain these pressures our strategy is:

• To isolate official from private gold markets by obtaining a pledge from central banks that they will neither buy nor sell gold except to each other;
• To bring South Africa to sell its current production of gold in the private market, and thus keep the private price down.

And here are the seeds for the need for a fiat currency: growing an economy when monetary supply (and, by implication, currency devaluation) is limited, can only pad the growth rate for the core economic entities so much.

Increasing liquidity

Trade won't be able to grow, and the system will remain vulnerable to speculation unless there is regular growth in the international money supply.

Gold can't provide the needed increase: industrial and speculative demand is too high. U.S. payment deficits can't either: foreigners are unwilling to hold more dollars when we run large deficits and unable to increase net reserves by accumulating dollars when our deficits are small.

Our strategy is to supplement gold and dollars with a new international asset, Special Drawing Rights (SDR).

And, of course, if the SDR does not work, the fall back reserve currency can always just be printed in limitless amounts, thus allowing massive liquidity-based expansion in the trade system, which will further allow the U.S. to grow its trade deficit to record amounts. Just fast forward 41 years.

Indeed, this document was presented before the gold standard was officially abolished. However, in the very near future Zero Hedge will disclose documents that highlight how even in the post-1971 world, gold was still perceived with the same liquidity management and "strategic control" interest as ever before.

CIA 1968 Financial Crisis

China issues a “Beijing Put” on Gold

Image via Wikipedia

Gold should get interesting now.

Ambrose Evans-Pritchard

China has issued what amounts to the “Beijing Put” on gold. You can make a lot of money, but you really can’t lose.

I happened to see quite a bit of Cheng Siwei at the Ambrosetti Workshop, a gathering of politicians and global strategists at Lake Como, including a dinner at Villa d’Este last night at which he listened very attentively as a number of American guests tore President Obama’s economic and health policy to shreds.

Mr Cheng was until recently Vice-Chairman of the Communist Party’s Standing Committee, and is now a sort of economic ambassador for China around the world — a charming man, by the way, who left Hong Kong for mainland China in 1950 at the age of 16, as young idealist eager to serve the revolution. Sixty years later, he calls himself simply “a survivior”.

What he said about US monetary policy and gold – this bit on the record – would appear to validate the long-held belief of gold bugs that China has fundamentally lost confidence in the US dollar and is going to shift to a partial gold standard through reserve accumulation.

He played down other metals such as copper, saying that they could not double as a proxy currency or store of wealth.

“Gold is definitely an alternative, but when we buy, the price goes up. We have to do it carefully so as not stimulate the market,” he said.

In other words, China is buying the dips, and will continue to do so as a systematic policy. His comment captures exactly what observation of gold price action suggests is happening. Every time it looks as if the bullion market is going to buckle, some big force steps in from the unknown.

Investors long-suspected that it was China. We later discovered that Beijing had in fact doubled its gold reserves to 1054 tonnes. Fait accompli first. Announcement long after.

Standing back, you can see that the steady rise in gold over the last eight years to $994 an ounce last week – outperforming US equities fourfold, even with reinvested dividends – has roughly tracked the emergence of China as a superpower in foreign reserve holdings (now $2 trillion).

As I have written in today’s paper, Mr Cheng (and Beijing) takes a dim view of Ben Bernanke’s monetary experiments at the Federal Reserve.

“If they keep printing money to buy bonds it will lead to inflation, and after a year or two the dollar will fall hard. Most of our foreign reserves are in US bonds and this is very difficult to change, so we will diversify incremental reserves into euros, yen, and other currencies,” he said.

This line of argument is by now well-known. Less understood is how much trouble the Fed’s QE policies are causing in China itself, where they have vicariously set off a speculative boom on the Shanghai exchange and in property. Mr Cheng said mid-level house prices are now ten times incomes.

“If we raise interest rates, we will be flooded with hot money. We have to wait for them. If they raise, we raise.”

“Credit in China is too loose. We have a bubble in the housing market and in stocks so we have to be very careful, because this could fall down.”

Gold Screaming On The 1-3-6 Rule

John Galt says,

Years ago a trader explained to me that if the 1 month, 3 month and 6 month Treasury yields dove towards zero and out of their “normal” range during a bull or bear market that there was a fear of a huge risk to the markets or other financial event occurring and that meant the big money as it is called, wanted to be in the safest of short term instruments that could be cashed out at maturity or sold on short notice to raise cash or return to the markets should it prove to be a non-event. Well, let us look at the history of this over the last three years and since the crisis began in February of 2007 when the first of the mid-sized mortgage finance companies started to collapse and a lot of us went “oh crap” and knew what was coming with this credit market implosion and eventual financial system collapse. Here is a 3 year chart of the 1 month Treasury continuous yield with notations.

Bank Holiday Will Be Totally Unexpected

Interested persons will want to consider Jim Willie's warning:
Bank holiday plan execution must be kept as surprise, since reactive preparations undermine the impact of the vast theft planned, both overt (from devaluations) and hidden (from stolen accounts).

Those who wait to take action lose all opportunity to benefit, and will surely lose significantly. The major central banks are very likely accumulating gold bullion on a net basis. Surely the Chinese, Russians, and Arabs are. If a planned US bank system shutdown occurs, its powerful effect would be muted by publicity of an unfolding, hence reducing insider profit potential. The pristine pure-bred Ruling Elite would be forced to share benefits with unwashed unworthy Plebeians. People would remove deposits from banks likely to be gobbled by Wall Street zombies, as withdrawals could later be limited.

People would transfer money out of the USDollar and into the Euro or Gold or Oil, before a grand US$ devaluation occurs. Next comes the threat of capital controls, limiting currency transfers across the border. The insider trade of the century will likely remain within the domain of the big bankers and other predators who have succeeded in looting the wealth of the nation. If word of the plan spreads, then people can prepare and take defensive action. No opportunity will be afforded those who wait until the news breaks.

They will be subjected to different price structure on assets, perhaps a big quantum change, with the US$ lower, competing currencies higher, gold higher, and all commodities priced in US$ terms higher, led by crude oil and industrial metals. Pay little attention to formal denials, and those by the intellectual servant harlots. They have offered little truth or fair warning of crisis in the last several years. Prepare!

Read the rest of Willie's article here.

CEO of Virtual EBank Embezzles 200 billion

A 27-year-old Australian tech worker and CEO of EBank, EVE Online's largest player-run financial institution which has thousands of depositors, embezzled about 200 billion of EVE Online's interstellar kredits, the game's virtual currency. EVE Online -- a massive multiplayer online roleplaying space game -- has more than 300,000 subscribers who pay $15 a month to play. The players earn money killing rivals (among other things) in a distant future where humans have colonized the stars in a game similar to World of Warcraft and Second Life. The CEO of EBank, who used the online name Ricdic, exchanged the embezzled virtual funds for $5,100 on the black market, according to Yahoo Tech's JaShong King.

"It was a very on the spot decision," said Ricdic, who's married and has two children. "I saw that as an avenue that could be taken, and I decided to skim off the top, you could say, to overcome real life (difficulties)."

"Basically this character was one of the people that had been running EBank for a while. He took a bunch of (virtual) money out of the bank, and traded it away for real money," said Ned Coker, of the Icelandic company CCP, which developed the game.

People are doing anything they can think of to survive. In the U.S. the average workweek hit 33.0 hours, a record low since the data were first collected 45 years ago. "At no time in the 1990 or 2001 recessions did we ever come close to seeing such a detonating jobs figure," said David Rosenberg from Glukin Sheff. "We have lost a record nine million full-time jobs this cycle." Ambrose Evans-Pritchard claims Sheriffs in Michigan & Illinois are quietly refusing to toss families on to the streets.