Why is the heartland of the United States experiencing such a horrific drought right now? At the moment, approximately 61 percent of the entire nation is experiencing drought conditions, and this is absolutely devastating farmers and ranchers all over the country. Less than two weeks ago I wrote an article asking what would happen if these drought conditions persisted, and now we are finding out. The U.S. Department of Agriculture has created the largest natural disaster area in U.S. history. The USDA has declared 1,016 counties in 26 U.S. states to be disaster areas. The USDA declaration basically covered about half of the nation, and there is now no denying how horrible this drought really is. You can see a map of this disaster area right here. This endless drought is being compared to the nightmarish drought of 1988, and if it persists into August it could become perhaps the worst drought that America has ever seen. The USDA says that approximately 60 percent of all corn in the country is experiencing “moderate to extreme” drought conditions. If this drought does not end soon, the losses are going to be mind blowing. Already, it is estimated that farmers and ranchers have suffered billions of dollars in damage. How much worse can things get
Tuesday, July 17, 2012
Today John Embry told King World News, “As the global economy continues to deteriorate, the natural reaction to that (by central planners) is to create as much money as humanly possible, to make sure that it (the economy) doesn’t implode.” Embry also said, “To me, that’s enormously supportive of higher gold prices.”
Embry, who is Chief Investment Strategist of the $10 billion strong Sprott Asset Management, also discussed market manipulation. Here is what Embry had to say: “Gold survived another attack from the other side last week, and posted a very strong recovery on Friday. So I’m not the least bit surprised meeting resistance today because one of the mantras in this whole gold suppression scheme is to keep excitement to a minimum.”
“One way you do that is you don’t permit follow-through of any significance. You don’t have a day where gold is up 3% or 4%, and then follow it with another day like that. So now gold is struggling to hold its price it reached on Friday.
Social Security’s trustees say the system needs only “modest changes.” In fact, the system is desperately broke.
The proof is buried deep in the trustees’ own 2012 report in a complex table, numbered IV.B6. Table IV.B6 is a long-run balance sheet for Social Security. It shows that the system’s $88.9 trillion in liabilities exceed its $68.4 trillion in assets by $20.5 trillion.
The $20.5 trillion fiscal gap separating Social Security’s liabilities and assets — its unfunded liability — is enormous; it is 1.4 times US gross domestic product and 34 times annual Social Security taxes.
Because $20.5 trillion is equal to 31% of the projected taxes, the system is 31 percent underfunded. To pay all promised benefits would require immediately and permanently raising Social Security’s 12.4 percent payroll tax (split evenly between employer and employee) by 31%, or 3.9 percentage points.
American workers would be ill-disposed, particularly in an election year, to say goodbye to the current temporary two- percentage-point payroll-tax cut, let alone surrender 3.9 cents more per dollar earned in exchange for no extra benefits.
What about cutting benefits? The $20.5 trillion is 23% of the present value of projected benefits. Hence, “saving” Social Security this way requires reducing all benefits immediately and permanently by almost one quarter — a non-starter for most of the system’s 55 million beneficiaries.
How about increasing the retirement age from 67 to 70 for those now 50 and younger? This means waiting 20 years to start cutting benefits for new retirees by only 20%. That’s far too little too late. If we wait 20 years to act, we will need to cut benefits by almost 50% to eliminate the system’s funding gap.
We need to fix Social Security without sacrificing its key objectives. If we are going to ask younger generations to take most of the hit for this broken Ponzi scheme, let’s give them a modern Social Security system that’s simple, transparent, fair and financially sound.
kingworldnews.com / July 16, 2012
With volatility in global markets, today King World News interviewed James Turk out of Europe. Turk told KWN, “The financial, monetary and economic conditions are so bad … that everything will spin out of control.” He also warned, “There is a new factor at work that is about to light a fire under the precious metals that few people recognize – food inflation.” He went on to say, “We can expect a rally from here that will take our breath away.”
Here is what Turk had to say about what is happening: “The sentiment indicators for gold and silver have been exceptionally low for weeks now, Eric, which is understandable given their lackluster performance during this period, as well as the downright discouraging performance of the mining shares.”
James Turk continues:
“But this is no time for complacency. The financial, monetary and economic conditions are so bad, that the situation could spin out of control at any second. Because these problems are not being solved, the point is that everything will spin out of control.
When that happens – as you and I have mentioned many times to the KWN audience around the globe – the best way to protect yourself and your family is with tangible assets….
The latest Rectangle pattern in the long list that I have highlighted in the Today's Big Stock Newsletter would be that of Provident Financial Services, Inc.
Provident Financial Services, Inc. operates as the holding company for The Provident Bank that provides banking services to individuals, families, and businesses in New Jersey. The company accepts various deposit products, including savings, checking, interest-bearing checking, money market deposit, certificate of deposit, and KEOGH accounts, as well as IRAs. It also originates commercial real estate loans that are secured by income-producing properties, such as multifamily residences, office buildings, and retail and industrial properties. In addition, the company offers cash management, remote deposits capture, payroll origination, escrow account management, and Internet banking services, as well as business credit cards. Additionally, the company sells life insurance and investment products, including annuities; invests in real estate development joint ventures principally targeted to meet the housing needs of low and moderate-income communities; and manages and sells real estate acquired through foreclosure.
To review Provident's stock, please take a look at the 1-year chart of PFS (Provident Financial Services, Inc.) below with my added notations:
PFS had been trading sideways within a Rectangle for the last (6) months. Rectangle patterns form when a stock gets stuck bouncing between a horizontal support and resistance. For PFS, the Rectangle pattern formed a $15 resistance (navy) and a $13.25 support (red). When the stock broke through resistance and out of the Rectangle pattern last month, it also broke to a new 52-week high. Now, it appears as if the stock may be ready to pullback to the old $15 resistance that should now become a new support.
The Tale of the Tape: PFS formed a very common chart pattern know as a Rectangle. Last month the stock broke through resistance and should be headed higher overall. A long trade could be made on any pullbacks to the expected $15 support.
By Dan Denning, Daily Reckoning.com.au:
How long is a piece of string? It’s as long as the Chinese government says it is! In today’s Daily Reckoning, we wonder whether statistics or prices can be trusted any longer.
And to remind you of what’s at stake in this great debate about the veracity of China’s economic data figures and the viability of its growth model, there’s this from the Chanticleer column in this weekend’s Australian Financial Review:
‘The slowest rate of economic growth in China since the global financial crisis is not a reason to panic but investors ought to be dusting off scenarios that involve a hard landing [like China's Bust].
‘It is better to have at least thought about the implications of a worst-case scenario rather than be taken by surprise when markets react to lower Chinese demand for Australian commodities…
‘The majority of Australians in default superannuation funds will have a high exposure to resources and will be vulnerable to a China slowdown. In fact, those with a typical default fund should brace themselves for negative super returns for the year to June 2012 of between 5 and 7 per cent simply because of their exposure to companies such as BHP Billiton and Rio Tinto.’