Monday, July 18, 2011

Return of the Gold Standard as world order unravels: Ambrose Evans-Pritchard

On one side of the Atlantic, the eurozone debt crisis has spread to the countries that may be too big to save - Spain and Italy - though RBS thinks a €3.5 trillion rescue fund would ensure survival of Europe's currency union.

On the other side, the recovery has sputtered out and the printing presses are being oiled again. Brinkmanship between the Congress and the White House over the US debt ceiling has compelled Moody's to warn of a "very small but rising risk" that the world's paramount power may default within two weeks. "The unthinkable is now thinkable," said Ross Norman, director of thebulliondesk.com.

Fed chair Ben Bernanke confessed to Congress that growth has failed to gain traction. "Deflationary risks might re-emerge, implying a need for additional policy support," he said.

The bar to QE3 - yet more bond purchases - is even lower than markets had thought. The new intake of hard-money men on the voting committee has not shifted Fed thinking, despite global anger at dollar debasement under QE2.

Fuelling the blaze, the emerging powers of Asia are almost all running uber-loose monetary policies. Most have negative real interest rates that push citizens out of bank accounts and into gold, or property. China is an arch-inflater. Prices are rising at 6.4pc, yet the one-year deposit rate is just 3.5pc. India's central bank is far behind the curve.

"It is very scary: the flight to gold is accelerating at a faster and faster speed," said Peter Hambro, chairman of Britain's biggest pure gold listing Petropavlovsk.

"One of the big US banks texted me today to say that if QE3 actually happens, we could see gold at $5,000 and silver at $1,000. I feel terribly sorry for anybody on fixed incomes tied to a fiat currency because they are not going to be able to buy things with that paper money."

China, Russia, Brazil, India, the Mid-East petro-powers have diversified their $7 trillion reserves into euros over the last decade to limit dollar exposure. As Europe's monetary union itself faces an existential crisis, there is no other safe-haven currency able to absorb the flows. The Swiss franc, Canada's loonie, the Aussie, and Korea's won are too small.

"There is no depth of market in these other currencies, so gold is the obvious play," said Neil Mellor from BNY Mellon. Western central banks (though not the US, Germany, or Italy) sold much of their gold at the depths of the bear market a decade ago. The Bank of England wins the booby prize for selling into the bottom at €254 an ounce on Gordon Brown's orders in 1999. But Russia, China, India, the Gulf states, the Philippines, and Kazakhstan have been buying.

China is coy, revealing purchases with a long delay. It has admitted to doubling its gold reserves to 1,054 tonnes or $54bn. This is just a tiny sliver of its $3.2 trillion reserves. China's Chamber of Commerce said this should be raised eightfold to 8,000 tonnes.

Xia Bin, an adviser to China's central bank, said in June that the country's reserve strategy needs an "urgent" overhaul. Instead of buying paper IOU's from a prostrate West, China should invest in strategic assets and accumulate gold by "buying the dips".

Step by step, the world is edging towards a revived Gold Standard as it becomes clearer that Japan and the West have reached debt saturation. World Bank chief Robert Zoellick said it was time to "consider employing gold as an international reference point." The Swiss parliament is to hold hearings on a parallel "Gold Franc". Utah has recognised gold as legal tender for tax payments.

A new Gold Standard would probably be based on a variant of the 'Bancor' proposed by Keynes in the late 1940s. This was a basket of 30 commodities intended to be less deflationary than pure gold, which had compounded in the Great Depression. The idea was revived by China's central bank chief Zhou Xiaochuan two years ago as a way of curbing the "credit-based" excess.

Mr Bernanke himself was grilled by Congress this week on the role of gold. Why do people by gold? "As protection against of what we call tail risks: really, really bad outcomes," he replied.

Indeed.

Precious Metals and Crude Oil Shows Signs of Strength

The past couple months (May and June) have been tough on precious metals and crude oil. But recent price action shows that buyers are stepping back into the market buying up these commodities once again.

Let’s take a quick look at the charts…

Gold Futures Daily Chart:
As you can see from the chart below, gold is making a new high. The big question is if it will do what it has done many times in the past, which is make a new higher for only a few days to get the general public (herd) long, only to then get sold into and come back down? The next few sessions will give us a better feel for this breakout/rally.

Silver futures Daily Chart:
Silver on the other hand has not performed as well as its yellow sister. Rather we are seeing a base being formed. The exciting thing about base patterns is that the larger and longer the base takes to form, the larger the potential move once a breakout occurs.

Crude Oil Hourly Chart:
Crude oil looks to be forming a base and or inverse head & shoulders pattern. Both these patterns point to higher prices with a price target around the $110-112 area.

Mid-Week Trend Report:
In short, I feel commodities are now in the spot light and where investors will be looking to put their money to work over the next couple weeks as the falling dollar directly helps boost their prices.

The equities market continues to be volatile with large waves of buying and selling almost hitting the them every trading session. During key pivot points in the market we know pricing for investments get a little crazy at times and we manage positions accordingly and anticipate some moves.

Technically Precious with Merv

Gold shot up during the week nullifying the previous (weird) head and shoulder pattern and moved into new highs. All speculative time periods are showing positive trends. What else is there to say, but I guess I’ll have to find something.

A LITTLE RANT

A reader of these commentaries emailed the other day with some criticism. These are always welcome as they may highlight things that I can change to improve my weekly commentaries. With his email this reader highlighted the writings of another commentator so I thought I’d see what that other commentator was talking about. There are hundreds of us on the internet with hundreds of different viewpoints. What a bunch of c--- in that commentary. So many errors, so much crap, so little time to correct. I don’t know exactly what that commentator had against technicians, after all no one is perfect, but he sure lambasted that discipline with so many errors or outright false statements that I was going to write a rant trying to correct him on many of his statements. After thinking about it for some time I decided that I’m too old to get into any controversy. I would, however, like to correct one misconception he wrote about (either he was misunderstanding technicians or was just outright lying). It is a misconception that is often written about technicians by non-technicians.

Almost all technicians use some sort of momentum indicator in assessing securities and markets. These could be the most popular MACD, the slightly less popular RSI or any of dozens of indicators that could be lumped into a general definition of a momentum indicator. I’ve been in this field since the mid-1960s:

I KNOW OF NO TECHNICIAN WHO USES A MOMENTUM INDICATOR AS HIS SOLE BUY OR SELL INDICATOR.

All technicians that I have come across use momentum indicators as one of the indicators towards a final buy/sell decision. Depending upon what the other indicators are saying the momentum indicator, at times, could be the final nail that activates a decision but it is not the SOLE indicator used. Most often momentum indicators provide technicians with ADVANCE WARNING of a possible change in trend. A technician would then most likely concentrate on his other indicators to give him that final buy/sell signal.

Momentum indicators are probably the most misunderstood indicators used by technicians. Very often when someone mentions momentum (especially if a fundamentalist does) I have no idea what he is taking about, unless he has defined his understanding of the term (earnings momentum, price momentum, volume momentum, sales momentum, etc.) At least a technician usually refers to price momentum. Most technical indicators that can be lumped into the general definition of momentum are price momentum indicators, although some can be used with volume. What else is there from a technician’s point of reference but price and volume?

I guess I ended up with a rant. Oh well, chalk it up to old age.

GOLD

LONG TERM

Nothing has changed from the long term perspective.

Trend: Gold remains trading well above its positive sloping long term moving average line. The price moved into new all time highs during the week but the break into new highs was not enthusiastic. Usually, a break into new highs, if during a strong bull market, would result in a dramatic upside move following the break. We don’t have that here so one would be cautious as the implication may be that the move was not a strong one, or even a false one.

Strength: The long term momentum indicator continues to move in its positive zone above its positive sloping trigger line. Here too the indicator is trailing the momentum of previous moves. So far the move into new highs has been on decreasing momentum. This IS NOT a sell indication but is a cautionary sign.

Volume: The volume indicator is the strongest of indicators on the up side. It continues to zoom higher into new high territory above its long term positive trigger line. This indicator is showing more strength than is the price or volume indicators.

As of the Friday close the long term rating remains BULLISH.

INTERMEDIATE TERM

Changing the indicators into intermediate term indicators everything mentioned above for the long term can be said about the intermediate term, so I wouldn’t go repeating myself. The one extra indicator I look at from the intermediate term is the position of the short term moving average line relative to the intermediate term line. The intermediate term rating remains BULLISH. This is further confirmed by the short term moving average line trending higher above the intermediate term line.

SHORT TERM

The past week was all on the up side for gold. The trend can’t continue without a breather but when will it come. Even a breather would be of short duration from the present indicators. I would suspect short term traders are getting a little hesitant to jump in at this time and are probably waiting for a correction to jump back in. Still, as of the Friday close the short term position of gold continues to be positive, although the lack of upside enthusiasm has been noted above.

Trend: Gold continues to move above its positive sloping short term moving average line.

Strength: The short term momentum indicator remains well inside its positive zone and above its positive sloping trigger line. We do see the indicator in the process of turning but the turn has not yet been completed and one should not assume that just because the turn towards the down side has started that it will be completed.

Volume: The daily volume action, unlike the volume indicator, is not showing any great enthusiasm for the gold up side. It may just be a cycle thing or it may not. If gold was truly very bullish then speculators would come out of the woodwork in great numbers and overcome any cycle effects.

Despite any caution shown by the indicators the position of gold at the Friday close remains BULLISH on the short term. The very short term moving average line is confirming this bull by trading above the short term moving average line.

With all those positive ratings what can we expect from the immediate future? Well, there is only the slightest hint that the next day or two will be bummers, but there is some indication. The Friday price activity seems to have stalled although gold did end on the up side. The Stochastic Oscillator is in its overbought zone but it could stay there for some time. One waits for the SO to drop below its overbought line as an indication that maybe a reversal of trend is ahead. I will go with the lateral trend for the next day or two until the dust clears up a bit.

SILVER

Percentage wise silver is once more providing better performance than gold, at least for the last week or two.

LONG TERM

Trend: On the Friday close silver was budding its head against that upper resistance level shown in last week’s P&F chart. A move to the $40 level will be a long term P&F break-out. In the mean time silver remains above its positive sloping long term moving average line.

Strength: The long term momentum indicator is in its positive zone and above its positive sloping trigger line but is not really showing strength versus previous moves. The indicator is still below its highs from the past several weeks of activity while the price is getting ready for a break-out.

Volume: The volume indicator is showing strength but not to the degree that the gold volume indicator showed. The indicator is, however, above its positive trigger line.

As of Friday close the long term rating remains BULLISH.

INTERMEDIATE TERM

Trend: Silver had remained below its negative sloping intermediate term moving average line since the May plunge but on Wednesday it crossed above the line and on Friday the moving average line turned very slightly to the up side.

Strength: The intermediate term momentum indicator has moved into its positive zone and above its trigger line. The trigger has also turned to the up side. Despite this the indicator is not really showing that much strength in the price move versus previous bullish moves.

Volume: The volume indicator is trending slightly from the lateral towards the up side. It remains slightly above its positive trigger line.

On the intermediate term the rating is now BULLISH with the short term moving average line just inching above the intermediate term line for confirmation.

SHORT TERM

Trend: The short term trend appears quite positive with silver above its positive sloping moving average line. Silver closed at new 2 month highs but could use just a little bit more upside to break that P&F resistance level.

Strength: Unlike the intermediate and long term momentum indicators the short term momentum indicator is showing significant strength versus previous rallies. It is in its positive zone and above its positive sloping trigger line. In addition, although silver itself is just barely above its previous recent highs the momentum indicator is already some distance above its previous highs.

Volume: Unlike the volume indicator, the daily volume action is not all that positive. For an on going rally one would have preferred considerable more upside volume than we have.

On the short term the rating is BULLISH with the very short term moving average line confirming.

It does look like silver is hitting a resistance and is starting to have problems moving. On Friday the intra-day high was still lower than the previous day even thought it closed slightly on the up side. It just may be starting a topping process but this would be a very short term one if it does actually top out.

PRECIOUS METAL STOCKS

The stocks had a good week with the higher quality stocks providing the better performance. The Merv’s Qual-Gold and Qual-Silver Indices were among the best performers during the week while the Merv’s more speculative Indices were in the weakest performer category. It looks like the higher quality investors are nibbling at the market but not too enthusiastically. For the market to really be in a roaring bull phase we need to see the gambling variety of stocks moving. That’s when speculators have decided that the up side is here to stay for some time. From the long term perspective although the vast majority of Indices are either POS or + N in this week’s table the Penny Arcade is still in a NEG rating level suggesting that there is still more work ahead before that enthusiasm comes in.

Merv’s Precious Metals Indices Table

Well, that’s it for this week. Comments are always welcome and should be addressed tomervburak@gmail.com.

By Merv Burak, CMT

Many U.S. energy companies seen ripe for picking: RRC, WLL, COG, CHK

Energy exploration companies like Range Resources (RRC-N 60.58 5.48 9.95%), Whiting Petroleum Corp. (WLL-N 58.37 2.87 5.17%) and Cabot Oil and Gas Inc. (COG-N 68.00 5.4 8.63%) have something that bigger oil companies desperately want: extensive acreage in U.S. shale basins.

Those companies and a long list of others are considered by Wall Street analysts to be takeover targets as a perfect storm for deal-making brews.

Sustained low natural gas prices have left some of the smaller companies vulnerable after they spent heavily to amass large areas to drill, while big companies are awash in cash. Crude prices around $100 US per barrel have also piqued interest in companies that own acres in oil-rich basins like the Eagle Ford and Permian in Texas.

"The large U.S. players all the way to the international companies have more cash than they know what to do with and a longer time horizon to develop the assets," said Neal Dingmann, an analyst with Suntrust Robinson Humphrey.

Mining giant BHP Billiton Plc's planned takeover of Petrohawk Energy Corp. for an eye-popping $12 billion pushed shares of potential targets sharply higher on Friday and is prompting a rush of speculation about who might be next.

"I think the key idea out there is you are looking for players that have a lead position in a basin," said Andrew Coleman, an analyst with Raymond James. "Who I think looks most interesting are Cabot and Whiting."

Cabot has acreage in the Permian Basin in Texas as well as positions in the Haynesville Shale, which straddles the Texas-Louisiana border. Whiting has acreage in the Permian and the oil-rich Bakken Shale in North Dakota.

Range Resources has substantial acreage in the Marcellus Shale in the U.S. Northeast. That basin is prized for its proximity to large natural gas consuming markets.

CHESAPEAKE SALE?

Companies that might bulk up on U.S. shale, bankers and analysts say, include ConocoPhillips, Marathon Oil Corp., Chevron Corp., Royal Dutch Shell Plc and foreign companies looking to take advantage of a weak dollar.

"Bigger companies are looking to add value," said one investment banker not authorized to speak on the record. "Shales are clearly part of their overall strategy and you've got to look at who the owners are of higher quality shale. It doesn't need to be a corporate transaction. Corporate transactions are tough to do, and there are lots of ways to capture shales."

Shares of Chesapeake Energy Corp. (CHK-N 32.25 2.04 6.75%) flew higher on Friday after news of the Petrohawk deal. But a number of analysts played down the possibility of a takeover.

Chesapeake has acreage in nearly every major U.S. shale basin, including 450,000 acres in the red-hot Eagle Ford Shale. But the company's structure is complex and it has already formed a number of joint ventures for its shale assets.

"People are saying Chesapeake and EOG Resources Inc are targets, but those companies are awfully large," said John White, an analyst at Triple Double Advisors, an energy investment management firm in Houston. "And Chesapeake is such a beast in terms of its structure, they have so many JVs, it would be quite a structural challenge."

How to Spot Tradeable Tops or Bottoms

Would you like to have gone short the S&P at 1,369, bought back the S&P at 1,259 and squared your long positions at 1,345?

If so, consider how Fibonacci can enhance your trading/investment decisions.

If you think Fibonacci was just a crazy Italian mathematician, consider this: The May 2 high at 1,370 and the June 16 low at 1,258 occurred right against Fibonacci resistance/support.

What exactly is Fibonacci? How do you calculate Fibonacci levels? Why do Fibonacci levels work? What's the evidence? How do you trade with Fibonacci?

This article is going to be a bit longer than my normal articles, but hang in there; it will be well worth your time. The answer to the questions above might be the single most important investment secret you've ever read.

What exactly is Fibonacci?

Fibonacci, a 12th century Italian mathematician, was the first to mathematically express an aesthetical proportion that has fascinated and influenced mankind for thousands of years.

This proportion is known as Phi or the Golden Mean and is derived from the Fibonacci sequence. The Fibonacci sequence starts out like this:

0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, etc.

Each number of the sequence is the sum of the two preceding numbers. The ratio of each successive pair of numbers in the series approximates Phi. The ratios of successive numbers in the series quickly converge on Phi. After the 40th number in the series, the ratio is accurate to 15 decimal places. Fibonacci numbers have certain defining properties:

Division of the preceding number by the subsequent numbers tends to 0.618. Division of the subsequent number by the preceding number tends to 1.618. Division of a number by the second preceding number tends to 2.618.

Division of a number by the second subsequent number tends to 0.382.

Fibonacci Everywhere

The Golden Mean is found in the universe, humans, animals, plants, DNA, music, the bible, ancient architecture, and biology. On your next leisurely stroll notice how many flowers are adorned with a Fibonacci number of petals. (more)

For World Investors, Plenty of Worries This Week

U.S. Treasury bonds could soon lose the privilege of being the only debt securities in the world whose value actually rises on the threat of a ratings downgrade.

That is because for the first time, the United States' top-notch debt rating is in jeopardy.

U.S. congressional leaders are refusing to lift the country's debt ceiling, preventing the Treasury from raising money it has already spent.

The political deadlock is threatening the United States' prized AAA credit grade, which major rating agencies have warned could face near-term cuts.

Even billionaire Pete Peterson, co-founder of private equity giant Blackstone, appeared to be getting worried. He has spent many years and a lot of money pushing for cuts in government spending to cut U.S. debt levels.

"The dangerous irony is that a refusal to compromise on a deal to reduce the nation's debt now will only serve to increase our debt," Peterson said in a statement.

Ironically, Peterson's often flashy anti-debt campaigns are partly to blame for the impasse, since Republican leaders have the backing of a majority of Americans on the issue, according to recent polls.

Economists say many individuals oppose the debt ceiling because they think that would mean giving a green light to additional government spending -- rather than simply making good on past promises, as is actually the case.

A downgrade of U.S. government debt would have unpredictable and highly disruptive consequences in financial markets and the broader economy.

Treasuries have long been used as a global haven for investors shunning risky assets. They serve as a benchmark for market interest rates and investment portfolios.

Federal Reserve Chairman Ben Bernanke argued last week that failure to raise the statutory limit would have "calamitous" results, including a long-term loss of confidence in the United States and possibly a new financial crisis.

In Europe, meanwhile, euro zone leaders will meet on Thursday to discuss a second bailout package for Greece and the financial stability of the euro area.

With the region's fiscal problems now threatening Italy, the bloc's third largest economy, there is a pressing need on both sides of the Atlantic for bold, comprehensive solutions to debt problems.

Europe's latest round of bank "stress tests" appeared to calm some nerves as fewer institutions -- just eight out 90 -- failed than investors had expected. But confidence remained shaky, with many questioning the stringency of the criteria.

"You go to give yourself an exam, you prepare the questions, you answer them, and you grade them and say, 'Hey look, I'm pretty good!"' said John Brady, a futures trader at MF Global securities in Chicago.

HOUSING HOLE TO DEEPEN?

As if the political hot potato were not sufficiently worrying, a thin U.S. economic data calendar features primarily figures likely to show the country's housing market remains in a deep rut.

Existing home sales were seen rising modestly to around 4.9 million annualized units. Still, the level was a far cry from the bubble peaks of around 7.1 million, and still well below readings close to 6 million seen after a home-buyers tax credit was put into place last year.

Housing starts, too, are also expected to increase slightly, even if real estate activity is unlikely to rebound demonstrably any time soon. The June employment report, which pointed to a virtual stagnation of the job market in May and June, showed the construction sector was again shedding jobs.

A more forward-looking, if secondary, indicator is the Philadelphia Fed's index of Mid-Atlantic manufacturing. The index, among the first peeks into economic activity in the third quarter, is forecast to have returned to positive territory at 2.0 following a reading of -7.7 in June.

Many economists expect the recovery's pace to pick up in the last six months after a sluggish first half, but dismal employment data have cast doubt on that prognosis.

How to Convert Your Social Security Payments into an Inflation-Adjusted Annuity

SOCIAL SECURITY may be the most beloved of all the government’s programs, partly because it requires so little thinking. You pay taxes while you work, then you and your spouse collect until you die.

This description oversimplifies things, of course. Social Security, as it’s currently constituted, is refreshingly straightforward but you do have to make one important choice, and many people could make their lives after retirement better if they chose differently.

As I discussed in a previous column, most economists and financial advisers say that in retirement, Americans would do well to increase the proportion of their wealth that pays a guaranteed income for life, much as Social Security does. The technical word for the financial instrument that accomplishes this feat is an annuity.

Traditional pensions are a form of annuity, and people who have them usually seem to love them. What’s odd is that people with retirement plans like 401(k)’s generally do not buy annuities, even though annuities would simplify and stabilize their financial lives. Economists call this state of affairs the annuity puzzle.

Several readers wrote to explain why they did not own (or recommend) annuities. Three major worries stood out:

¶Most annuities are not inflation protected, so what happens if high inflation returns?

¶How can a buyer be sure that the company selling the annuity will be able to make the payments 20 or 30 years from now?

¶Annuities can be complicated and are sometimes sold with large fees. How can buyers know whether they are getting a good deal?

All of these concerns are legitimate. I wish I had found a simple recipe to solve all of these problems, but they are tough ones. Still, the federal government could help matters. For example, it might create rules to encourage more employers to offer safe and fairly priced annuities within their 401(k) plans. There is interest in Washington in doing this, but the details are tricky. Employers would like a clear-cut rule absolving them from the responsibility of choosing an annuity provider, say, by granting a safe harbor if theinsurance company has a satisfactory credit rating, but given the recent track record of rating agencies, this particular rule is unlikely to be adopted.

In light of these difficulties, let’s focus on the one source of annuities that is fully inflation protected, is fairly priced, and, because it is run by the government, is reasonably safe: Social Security benefits. Claiming that Social Security benefits are safe may sound na├»ve, but my view is actually quite cynical. I believe that as long as the elderly continue to vote in large numbers, no Congress will renege on promised payouts for those already eligible to receive benefits.

Of course, the system has to be tweaked to keep it self-sufficient, but economists of every stripe agree that this is a relatively easy fix, unlike, say, trimming the rising cost ofMedicare. The fix might trim benefits in some way, perhaps through a less generous indexing formula, but I believe that anyone already eligible to claim benefits can safely count on getting them.

If you think this premise is preposterous, stop reading here, and complain to your representatives in Congress. (While you’re at it, you might also tell them to get the debt ceilingraised, or better yet, simply eliminate it, so we do not frighten people into thinking we would actually default on our debts, even to ourselves.)

So here is a bit of good news. There is a simple, easy way to convert a portion of your wealth into a fairly priced, inflation-adjusted annuity. Simply delay when you start receiving Social Security benefits.

Participants are first eligible to start claiming benefits at age 62. For those who wait, the monthly payments increase in an actuarially fair manner until age 70. The claiming formula is designed to make the economic value of the stream of benefits the same, regardless of when you start. The longer you wait, the greater your monthly benefits when you start getting checks, because you will not receive them for as long a period. If you wait from 62 to 66 to start, your payments go up by at least a third, and if you wait all the way until 70 to start claiming, your benefits go up by at least 75 percent. (I say “at least” because if you delay claiming and keep working it is possible that you can qualify for an even higher benefit level.)

With these rules, waiting is the cheapest way to buy more annuity coverage. However, few take advantage of this opportunity. Currently, about 46 percent of participants begin claiming at 62, the first year in which they are eligible, the government says. Less than 5 percent of participants delay past age 66. This is unfortunate. If you are in good health and you can afford to wait, my advice is that you should wait as long as possible. The greater is your guaranteed lifetime income, the easier it will be to organize your retirement budget, and the less you will worry about living “too long.”

The Social Security Administration could take some steps to encourage people to delay. First, change some confusing terminology. For historical reasons, Social Security labels an intermediate age between 62 and 70 as the “Full (normal) Retirement Age.” Yes, the parenthetical “normal” is part of the official language. The age had traditionally been 65, but it is slowly being raised to age 67. For anyone born between 1943 and 1954, for example, the age is set at 66.

Let’s get rid of this awkward and misleading term. Benefits at that age are not “full” and retiring at that age is not “normal.” Research shows that the designation of a full retirement age can serve as an anchor that influences people’s choices, and may help explain why so few people delay claiming past age 66.

THERE is a bolder step that could make additional Social Security benefits available for many people. Pamela Perun of the Aspen Institute suggests that participants be able to “top up” their Social Security benefits. Participants could buy up to $100,000 in additional annuity benefits by sending a check to the Social Security Administration. The $100,000 cap is arbitrary, but the idea behind having a cap is to leave the high-end market to the private sector. Payments would just be added to the usual Social Security check, so the administrative costs would be small.

These reforms will not solve everyone’s problems, but they would make household budgeting easier and less worrisome. With baby boomers starting to reach retirement age, now is a great time to take these steps.

Webster Tarpley : The worst Economic crisis in world history

WEBSTER TARPLEY - GENOCIDAL WORLD ECONOMIC DEPRESSION : the second wave of world massive depression lashes the globe , United States on the brink of bankruptcy and default thanks to a click of lunatics and the treachery of Wall street puppet Obama , a surprise sneak attack this week has thrown Italy into the crisis previously inhabited by Greece and Portugal ...this is a world economic depression of unprecedented proportion , of genocidal potential and we cannot have business as usual these are not market events these are not boom and bust cycles this is a break down crisis it is a disintegration of the entire world system

US Economic Calendar For The Week

TIME (ET)REPORTPERIODACTUALFORECASTPREVIOUS
MONDAY, JULY 18
10 amHome builders' indexJuly 1413
TUESDAY, JULY 19
8:30 amHousing startsJune 580,000560,000
8:30 amSingle-family permitsJune --405,000
WEDNESDAY, JULY 20
10 amExisting home salesJune4.93 mln4.81 mln
THURSDAY, JULY 21
8:30 amJobless claims7-16 405,000405,000
10 amLeading indicatorsJune0.3%0.8%
10 amPhilly FedJuly -2.7-7.7
10 amFHFA home pricesMay --0.8%
FRIDAY, JULY 22
None scheduled