Chickens are coming home to Roost!

Kia Ora,

It really seems in the Western world at least the Chickens are coming home to Roost.

Through out Europe the Sovereign debt crisis is starting to have an effect at least for now in what has become known in the financial circles for some time as the PIIGS or Portugal, Ireland, Italy, Greece & Spain.

Bail outs & austerity measures followed by riots. Italy even got their riots in before as they known what is coming.

Britain & France ausiterity measures same result. Because everyone has not wanted to listen to the 'doom & gloom' predictions but as one financial commentator likes to say;
"Those that prepare for the worst only know the best."

Then you have JP Morgan been hounded for manipulating the silver market. One estimate is it has shorts on 3.3 billion ounces of silver. That is more than all that is available above ground. Depending on who you are reading or listening too at least three times more than is above ground.

To short that much means someone is selling that much. A short is where someone sells a derivative or share they don't own with the view to buying it back at a lower price because they think the market is about to go lower. First rule is never sell naked(or with something to cover the trade going the other way) word is they forgot the first rule.

Since they are now under investigation for the manipulation & a campaign has also started to bankrupt them through the silver market they have taken a hedge of buying 50 to 80% of the copper market (now reportedly possibly 90%) that is currently held in warehouses. A hedge is to cover your losses should a trade go the opposite way to what you expect.
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If so then it would mean the manipulation of the silver market is at an end once they can cover their losses. Though in the last few days a large amount of puts(options trade when you think the price will go down) have gone on silver at $15 which means someone expects silver to go lower or are hoping it will.

So if people think they have all this silver or gold & find out that it is not available what then?

Not to mention most will not be aware that you can no longer exchange those derivatives for actual physical gold or silver. It changed earlier this year & most people are not aware of that fact.

So that are two forms of the same Chickens coming home but there is a third which you have seen in the protests & riots in Europe.

That is the lack of boundaries for children growing up. There is no respect anymore & a belief that it is ok to attack those whose job is it to keep society from sliding into anarchy. Seems by having no boundaries the anarchy is arriving anyway.
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In the last week here in New Zealand teenagers have being involved in stealing vehicles, dangerous driving, drunken driving being killed by not been able to handle a vehicle, running from the police or accidents & attacking police officers. Not to mention armed robberies.

What is going to happen when the government has to impliment its austerity measures? So far all the protests here have been quite civil in nature.

Society has lost control.

The comment the other day was "well burglaries & crime will be up as it is school holidays." It has been like that for a few years now but right now it is an epidemic & the police do what they can under the law but as they found one teen just kept leaving home & stealing cars.


So all the out of control spending & use of bad debt over good debt coupled with lack of boundaries is resulting in the break down of society.

The Chickens are really coming home to Roost!

http://www.foxhoundsecurity.co.nz

Is Wikileaks the Trigger?

Kia Ora,

In a recent post I wrote about the expected collapse of the worlds financial system & what could trigger it.

Well it is very likely that Wikileaks will provide that trigger as long as they are not shut down in the meantime.

Wikileaks could of averted the one course nations take to avert financial crisis or prolong financial crisis from happening, though in the long run make things worse.

That is going to war!

Although North Korea could be regarded as a loose cannon, that released cables point to the fact that China thinks it might be good to have a unified Korea, could make North Korea realize they need to tread carefully.

Iran too could see things in a different light & the US will have to deal with the fact on both fronts it is now known the Russians think things are not as bad as the US makes out so favour different options.
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So why would Wikileaks be the trigger for the collapse of the worlds financial system.

Its next release(if still in operation) is to be documents concerning one of the big banks in the US(suspected to be the Bank of America as they have said before they have material on that bank) & the corruption involved.

Why would that affect the world?

It is not new news to some, but by coming through Wikileaks it will suddenly be seen by the majority who have been manipulated up until now.
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It could expose for example the belief some commentators have that oil would still be around $US11 if it wasn't for the large banks manipulating through the use of derivatives the price of oil. Or the fact that again through the use of derivatives the price of silver has been manipulated right down.

Silver been of particular interest at present as one commentator(Max Keiser) is promoting the idea of US citizens to buy 100 million ounces of silver to bankrupt JP Morgan. Yet another source though is saying there is only 8 days worth of silver above ground at the present time. So if miners went on strike where silver is produced or everyone tried to buy at once the world would be in serious trouble as silver is essential to all modern electronics. Amongst other uses.
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Any of those issues coupled with the fact the Sovereign debt criss refuses to go away & is unlikely too. Add in the fact that early next year the US sub prime loans become due again but to a greater amount than in 2008.

What will be the results?

Well people are going to find it more expensive to buy food, unemployment is increasing most places & will continue to do so. Despite the fact US figures are expected to show less unemployment this week which hides the fact 2 million people will be cut from the figures as they have been on unemployment for 99 weeks. They will still be unemployed, just outside the system with another 2 million to be taken off the numbers later this month. Another manipulation.

Crime will increase & many countries where they have thought they have missed the worst of the Depression(not recession) such as Australia & New Zealand will get hit hard. Even here in Christchurch where post the earthquake the rebuilding was expected to assist in the economic recovery.

But though all this will also happen without Wikileaks, it is likely to happen sooner & faster with Wikileaks releasing that information, but the effects will not be as bad as it would if we continue on the present path.
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What does that all mean?

Well we have seen with austerity measures increased civil disorder & there will be a corresponding increase in crime.

If hyperinflation kicks in with increasing prices in particular of food we will likely see food riots & again a rise in crime.

This is why you see China ignoring the US. China's biggest fear are its own people, not the US & so it is trying to manage its economy to ensure its people have jobs, cash & food. It is appearing to look to raise the Yuan at its own pace because if they do it quickly it will have two effects. One put many of businesses out of business & two destroy the US economy completely. By taking its time it hopes to change the businesses to allow the Chinese people to buy the goods they produce.
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Allgedly the Chinese have stockpiled a lot of commodities to keep their industries moving as the world collapses around it. China has also been investing a lot in commodities in emerging economies in Africa & South America. Lastly like many Asia governments it has apparently being encouraging the people to purchase gold & silver.

China & Russia are now bypassing using the US dollar in trading between the two as they obviously see the US currency as toast.

But as said in a previous post it means the it is time of opportunity as long as you educate yourself & prepare.

It also means that security will be a growth industry.

http://www.foxhoundsecurity.co.nz

Descent into Hell begins!

Kia Ora,

The world is beginning its descent into Hell as predicted by a few economic commentators. The Sovereign debt crisis that first raised its head in Dubai nearly two years ago is starting to gather steam.

One commentator has compiled a list of the 30 countries currently living on a wing & a prayer. This was passed to me by a reliable source who like me keeps an eye on a certain group of commontators & we compare notes. In that list New Zealand ranks 13th & Australia is also in the top 30.

They did not mention who was top of the list actually, but I would wager it is the US with over US$200 Trillion(840% of GDP) in debt most of it 'off book' just like ENRON. Britain would be up around the top five. China could even feature though for different reasons.

New Zealand is estimated to be at 200% of GDP but there is a difference. Most of NZ's debt is private. But what bailouts do is transfer that debt to the government & from there to the central bank so transfer the wealth & power to the private bankers who really run things.

Even when you don't want a bailout or know it is bad for you.

Just look at Ireland. If as looks like will happen they accept the bailout then the International Monetary Fund & the European Union will control Ireland, not the Irish. Already the austerity plans been drawn up include a drop in the minimum wage.
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We already see what austerity measures result in. Riots & civil disorder. Britain has taken measures, but says it is not as badly off as Ireland. Not sure where they have got that from. The only difference between the European countries, Britain & the US is the later two are still able to print their own money(courtesy of the private banks better known as the central banks) which will be actually worse in the long run.

During this last week whilst New Zealand has been fixated on the tragedy in the mine, we had our credit rating outlook lowered. This will force the government to take more austerity measures. We already have teens challenging the police over gatherings & alcohol. It is only a short step from there to the riots in Britain as it has spread through social media & all are aware of it. In fact social media was used to organize one of the marches in Britain. One that got out of control in the most recent set of marches.
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For the average person what they will see is rises in food prices, jobs lost & unemployment will just sky rocket. It is already much higher than offical figures as those figures are manipulated or leave out the people no longer in the system.

As was pointed out in Ireland when as part of the austerity it is proposed to limit time on unemployment. Hey that's great but where are the job's?

This will all result in a rise in crime.
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So what sort of things could trigger a turn for the worse in regards to civil disorder? In France it has been the raising of the retirement age, in Britain the proposed raising of education fees & cutting cash flow to other education.

In New Zealand it could be frustration with the recovery from the Christchurch earthquake, the snow storm in Southland or the investigation into the mine incident(historically these inquiries result in a lot of anger & accusations). Even more so the holding back of information like the rupture of the gas pipe into the mine or yesterday after constant denials that anything was different about the earthquake an interesting article.
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That article first referred to the fact that though the first wee shake was 7.1 it actually realeased the energy of a 7.8 which has scientists a bit mystified, followed by the comment that a "spaghetti junction" of faults lay under the Canterbury plains & had been known about for years. New ones were forming & they all pointed at Christchurch. Now people have been feeling that this was the case but it has been denied since the wee shake with one 'expert' saying there would be no faults actually under Christchurch even though the media had the day before revealed the existance of the Addington fault from the 1869 earthquake.

So withholding information that shouldn't be then it coming to light could be a trigger to social unrest. Others have used the wee shake as an excuse for them commiting crime.

Combine natural disasters with a financial crisis & you have the ingredients for a time bomb. But it is also the time of opportunity & that is not criminal opportunity.
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One commentator has likened the current situation in the US with so much currency been printed as to the conditions in place in France prior to the French Revolution where many people ended up loosing their heads. The guilliotine was operated & executions carried out apparently by the Ministry of Public Safety.

Another commentator in the US has warned that people need to start stock piling food & buy a rifle then wait for the riots to stop. It is likely to be really that bad. This was from a financial commentator not a survivalist.
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People are really starting to feel this is all true. It is the time of opportunity also, but most people are starting to feel this. It has been funny how people's attitude change towards you as they start to feel that though they had felt what you have been saying is incorrect because the government or experts tell them so, to what their gut feeling now tells them is starting to happen.

It is just like Health & Safety are supposed to be, prepare for the worst, but hope for the best. Look for the opportunity.

http://www.foxhoundsecurity.co.nz

World in Turmoil

Kia Ora,

It  has being an interesting week.

First there has being the attempted car bombing in Time Square, New York.

Mayor Bloomberg made the statement that it was down to great people & police work.

Now people are just saying lucky & I would go with this one.

It was only after the failed detonation that it was detected.

The bomb was called amateurish, but what is not known well is that is how many in Iraq were put together.

There was one ocassion where to avoid detection by security forces, the suicide bomber picked up passengers in his taxi. It was only when there were some popping sounds from the boot of a premature detonation that the passengers realized, but luckily it failed.

As it was relayed, that when the Iraqi police arrived the three fares were giving the driver the hiding of his life.

This morning there is news of at least three deaths in riots in Greece. Yet if you have being studying the economic woes of the world, Greece is one of the western countries with the lest debt. Being part of the Eurozone though, it can't do what the US & UK are doing by trying to print their way out of trouble. In the long run that is a worse option if you look at history.

So what does that bode for the rest of the world?

The more people say there is a recovery, the bigger the shock there is going to be for those hit by the depression taking full effect & therefore the bigger the emotions that will be unleashed.

So, no where is safe.

Then we go to the Liquor licence hearings in Christchurch, where police oppose the issuing of liquor licences to Party buses.

In one part of their submission, the police refer to the time where 100 patrons of  three party buses, through aggressive behaviour were able to deny the police the ability to detain for questioning a male suspected of assaulting a woman.

So to say Greece won't happen in NZ is a myth. It bubbles away just under the surface & having had riot training courtesy of the military, you often see the requirements for a riot to happen building. In particular with the NZ alcohol issue is to the fore.

As the economies worsen you will see more extreme groups form ready to stir any crowd into action against the police or even security who deny them what they believe is their right.

So an increase of good security (which in general doesn't exist or the security staff are not allowed to practise it) is required not just to combat terrorism, but the growing trend of crime in general.

As of today there is a new security service available here in Christchurch with the aim to make our communities safe.

Details can be found at www.foxhoundsecurity.co.nz