What's In Your Wallet?

While the current set of bureaucrats tinker with the economy, we must find ways to protect ourselves from them.

10 year T-Bills have risen to 2.88% yield due to hints that the Fed will taper off the monthly purchase of $85 Billion monthly, (QE or Quantitative Easing) thereby causing a perceived shortage of T-Bills. Ridiculous. Paper backed by paper is still paper.

 

That same 'tapering' hint, as they call it, has caused a drop in the Dow back to sub 16,000 levels, erasing the recent gain. Notice, there has not yet been any 'tapering' yet stocks have dropped. The stock market is a dangerously paranoid place.

 

One other effect of the dreaded tapering is that there has been a sell-off of gold (and silver) to levels set in winter of 2010. Investors, ever eager to stay ahead of the curve, are rushing back into the bond market (T-Bills) as interest rates ease up. Now is the time to find bargains in metals. I recommend:  http://www.apmex.com/product/59745/1922-1935-peace-silver-dollars-100-coin-bag-vg-xf

 

Read 6 Main Financial Threats for 2014: http://www.foxbusiness.com/investing/2013/12/12/six-threats-to-market-in-14/?intcmp=obnetwork

 

#1: As with most things on Wall Street, the conversation must begin with the Federal Reserve, which is widely expected to begin the delicate process of unwinding its unprecedented quantitative easing experiment.

If the Fed decides to pull the plug on the $85 billion monthly bond-buying program too early, the economy could slip back into recession. If it waits too long, it could unleash a nasty bout of inflation. There’s also the risk the Fed could lose control of the bond markets, sending closely-watched Treasury yields spiking.

“The Fed is in the hot seat. The markets ultimately might find the emperor has no clothes,” said Mark Luschini, chief investment strategist at Janney Capital.

Higher rates could derail the housing market or spark a financial crisis in certain debt-ridden emerging market countries.

The risk of a policy misstep is exacerbated by the leadership change at the Fed, with Ben Bernanke set to hand the keys to the central bank’s $3 trillion balance sheet to Janet Yellen in January.

You Voted For Him, This Is What You Get

In the Obama administration no one ever gets fired or disciplined. They might change posts but that's about it. The most outrageous acts, like Fast and Furious gun running by the DOJ, or targeting conservatives by the IRS for additional scrutiny, or attempting to cover up the lack of support in Benghazi are denied, stonewalled, obfuscated, and outright lied about. No one is ever to blame. No one is accountable. We watch the parade of likely suspects pass before the congressional hearings, then slither off into the past, forgotten.

What this should point out to even the most casual observer is that the Obama administration has a definite agenda. These are the acts of sabotage, not random mistakes or a loose cannon here and there. These are actions meant to weaken the country as a whole. There are far too many of these similarities to assume it is random bad judgement. The DHS and IRS now have unprecedented power and the means in military hardware to enforce it, while certain unsupportive Generals are being systematically 'retired'. Courts in Washington DC are being 'stacked' with Obama supporters. What's going on?

Where is he taking the country? Does he have everyone fooled? Will we awaken one morning to find we are one step from being a third-world country? To accomplish that all is needed is to weaken our economy while pretending everything is fine. This is being accomplished slowly but surely. The Fed is printing and spending $85 Billion each month on T-Bills. The money is supposed to wind up with banks, who are supposed to invest that money by making loans to companies and individuals. But they are sitting on it, piling it up in their vaults, just waiting. Never mind that the dollars are backed by nothing.

The Fed cannot keep this up for long. The Fed desires to taper off these QE (Quantitative Easing) payments. But we see what happens if they so much as hint the donations will stop. The stock market falls. Damned if they do, and damned if they don't. It is not hard to imagine the sequence of falling dominoes in our future.

The choices for each individual citizen will be hard. You will need water, food and shelter. The government will provide nothing. Municipal services will fail. Hope and Change are upon us. As Chief Justice John Roberts said, 'You voted for him and this is what you get'.