“The financial illiteracy of the uneducated lower classes and the willful ignorance of the supposedly highly educated classes has never been more evident than when examining the concept of Federal Reserve created currency debasement – also known as inflation.
The insidious central banker created monetary inflation is the cause of all the ills in our warped, deformed, rigged financialized economic system.
The outright manipulation and falsity of government reported economic data is designed to obscure the truth and keep the populace unaware of the deception being executed by the owners of this country. They have utilized deceit, falsification, propaganda and outright lies to mislead the public about the true picture of the disastrous financial condition in this country.”
– James Quinn
James Quinn is a Senior Director of Strategic Planning for a major university. He has held financial positions with a retailer, a homebuilder and university in his 25-year career. He earned a BSc in Accounting from Drexel University and an MBA from Villanova University. He is a Certified Public Accountant (CPA).
Do James Quinn’s comments make you see red? Either for or against Bankers who buy politicians, and manipulate reality, to suit themselves?
If so… Do you want revenge on the Bankers?
Well to do that, the short answer is to get a whole lot more money than you currently have.
Are you asking: “How do I do that?”
Depending on where you’re starting from, that can be a lot easier than you think.
It’s a truism, that to become rich, you have to spend less than you earn, and invest the difference. If you have excess finance, in a low interest environment, it can pay to borrow to invest, and use the additional leverage to make money faster. Provided you can get a better return than the cost of borrowing. (But you have to watch borrowing costs carefully, as things can change quickly.)
And, it doesn’t matter how much you earn, it all starts with savings. BUT if the value of your savings are being stolen, time after time, by Central Bank induced price inflation, then what better revenge on those central bankers than to become rich using the very things that they seek to hold from you.
Twenty Five years ago, I was a Business Studies Lecturer in several Community Colleges, before the technology bug bit me, and I moved into the field of Computing, building PCs, PC Networks, and eventually writing Software in over 33 different computing languages and variants. I even went on to work at Dell Headquarters in Roundrock near Austin, Texas. However, about the same time I began teaching, a fourteen year old school-kid found an old Golf Cart in Wisconsin, abandoned from a nearby Golf resort, and the birth of a new technology had found its roots.
Like many 14yr old boys, J. B. Straubel, began playing about with this old vehicle, and “tinkering”; like I did at a similar age, when I bought a second hand Motor-Scooter to ride off-road on the local wasteground near my home. But, Straubel, was no ordinary kid. This boy was to become a technology genius.
The abandoned golf kart, had an 11 brake horse power motor, and a flat out top-speed of 15mph (24kph), if you took it on the open road; and like many teenagers enamored with their latest vehicle… Straubel asked the question, “How can I make it better; go faster?”
Straubel’s tinkering, resulted in him retro-fitting a “micro-turbine” and a high-speed flywheel, to assist in re-charging the battery, and this tinkering, eventually led him to two technology giants – the Rosen Brothers.
Harold Rosen, and his brother Ben.
Harold Rosen, is an aeronautical engineer, who had been instrumental in launching America’s first geo-stationary orbital satellite, in 1963.
Ben Rosen, had been the Chairman of Compaq Computers. Together they funnelled money to Straubel who by now had a Bachelor’s Degree in Energy Systems Engineering and a Master’s Degree in Energy Engineering from Stanford University, and a $24million research project. This led to the development of a Gas-turbine engine, which was coupled with a hybrid power-train with an energy storage sub-system that used regenerative braking. In plain English – A Hydrogen powered fuel-cell, with Batteries to store the energy which is also generated by the braking system.
This technology is expected to double the range of existing technologies, and uses can be found in the military sphere. The Company founded to produce this technology was Volacom, which Boeing eventually bought.
However, the technology led to NASA’s Phantom Eye project, which led to development of a Hydrogen Powered Aircraft, whereby an un-manned aerial vehicle could fly to 65,000 feet, and stay airborne for FOUR WHOLE DAYS! Imagine the military uses for an aerial vehicle that can stay aloft for that long? Weather Reports? Reconnaisance? Spy-Cameras? And no pilots to be shot down… And that was just the start…
The Phantom Eye project from NASA, led to a project codenamed “Vulture” which led to the development of a similar vehicle, but this time Solar-powered, that will fly to 90,000 feet and stay afloat for FIVE WHOLE YEARS… Now imagine the possibilities of THAT?
Straubel even went on to turn an old Porsche 944, from the 1980s into an electric vehicle, and briefly claimed the world record, for an electric vehicle using it.
But where is all this technology taking us?
In order for TESLA Motors, (TSLA:NYSE) to achieve their goals, to produce an electric car for the masses, they will have to get the price down to around $30,000. (circa £18,000)
To do that, they will need to build around half a million vehicles a year, at their so-called “Gigafactory”, and that’s where J. B. Straubel comes in.
Most of the patents filed by TESLA, have Straubel’s name on them, not CEO Elon Musk’s. Straubel is co-founder, and their Chief Technology Officer, and their Gigafactory whose intended location is still to be disclosed will be announced later this year, using many of these technologies.
But for TESLA to achieve the price they want, they will have to use every trick in their VERY extensive technological book, to reduce costs – Solar Power for the plant; huge land expanse, Lithium and Graphite close by, rail links, nearby technical staff, and of course all the materials to build the plant, and get materials into and finished cars out of the plant with ease. That means a rail main-line nearby, with an access raillink. It means rolling stock, and the weather needs to be just right – with 300+ days of sunshine per year.
The list of TESLA’s suppliers is not long, but it is long enough. And if their new factory achieves its goals, and TSLA achieves its production and other targets, these suppliers will all make huge sums from their order book.
TESLA Motors’ Known Suppliers:
Hitachi Cable America
Zanini Auto Group
and of course TESLA themselves.
The above companies supply everything from disks and disk brake-pads, springs for suspension, tail-gate lift suspension arms, high-tech radio equipment, mirrors, cables and heat management units for the batteries. And currently these batteries are produced by Panasonic.
BUT there’s something that is not mentioned in this list of all this equipment… WHO Supplies the Lithium Carbonate for the Lithium-Ion batteries?
Or who delivers the batteries, and with freight costs for the Lithium for the batteries a big piece of the overall price, with each battery pack weighing upwards of 1300 lbs, keeping the distance between supply and final end use to a minimum will be a serious cost saving? BUT, what if the company supplying the Lithium has the lowest costs of production, large resources, and has access to large resources of Graphite – and you need 4 times as much Graphite as you do Lithium to make a Li-ion battery?
Graphite is four times more conductive than copper, and the Li-ion batteries rely on a thin graphite polymer film sheet, that can withstand temperatures that reach upto 400 degrees celcius (752° F).
There is one American Tech Company, which is, the same company that produced the Graphene shield (made from graphite) that shielded the Mars Rover that NASA recently landed on the moon that may become one of these suppliers.
This company holds many patents for a huge array of Graphene based technologies, and Graphene is 200x stronger than steel. So strong you could balance an elephant on a pencil on one sheet, and it would hold up. And so light it will revolutionise aircraft design. And that company is? Graftech International (GTI:NYSE).
Of course, the U.S. Geological Survey team already knows about 5.5million tons of Lithium, in the U.S., and just last year, in Wyoming, the University of Wyoming found 18million tons of Lithium, equivalent to about 720 years of current global lithium production.
But also, one North American based Corporation, has a Joint Venture with a British Company, who have recently found a considerable Lithium resource close to where it will be needed and the British Company owns 30% of the resource figures of 119,921,000 tonnes, at a 1.66% Lithium Carbonate Equivalent (LCE) giving 3.28 million tonnes, meaning this small Canadian Corporation owns the other 70%, and this company, as of 4th June, trades for less than one dollar with its price already up 538 per-cent from its year low.
That company is Bacanora Minerals Ltd (“Bacanora” – BCN:TSX).
And with TESLA set to announce the location of its Gigafactory later this year, and to build the infrastructure to build 500,000 electric vehicles per year by 2017, this means, this company’s share price is ready to pop further.
Rare Earth Minerals Plc (LSE AIM: REM) the British company just mentioned, has an option to purchase upto 49% of the project, and recently announced that the Mineral Resource for the Sonora Lithium Project in northern Mexico has increased by 37% to a new total of 3.28 million tonnes of Lithium Carbonate Equivalent (“LCE”) and has been upgraded from the Inferred to Indicated category. A Preliminary Economic Assessment (PEA) will now be carried out, and this will determine if the economics work out, but it will also give plenty of opportunities to buy at low prices, if as I suspect, a major stock-market downturn is not that far away – just about as soon as interest rates start climbing, to rein in inflation over 5% p.a. – though that may be several years away.
This corporation also has another mineral resource with a pilot plant in operation to test the potential of producing Boric Acid, which is used in hundreds of applications, and is likely to generate more income from the resource.
However, there are also lithium reserves at Rockwood Holdings’ (NYSE:ROC) Silver Peak site in Nevada which has an estimated total of 118,000 tons of Lithium in a 20-square mile area; Rockwood is also one of the world’s leading producers of Lithium Hydroxide.
And you better be ready soon, because Jim Rickards is CONVINCED, that as the old saw goes: “The End Is Nigh.” Some extraneous event will trigger the collapse. No-one really knows what that could be, but we can take a few wild guesses – Ukraine spiralling out of control, or a huge new event in middle-eastern politics, or even a military spat between China and Japan, or similar. And China recently sank a Vietnamese fishing vessel fishing in the South-China Sea. Could an event such as this trigger events between East and West? Just such an event instigated by an angry Serb, who shot Archduke Ferdinand, in modern day Bosnia, caused the start of the first world war, due to the number of cross-border alliances.
And if you’re not ready, then there is precious little time left.
As I recently said and as Miles Frankin has echoed – American “exceptionalism,” may be the death of us.
For those keen to learn a little more about crypto-currencies, and hear a debate between those for and those against watch this.
And for those looking to maybe dip a toe in the water and get some crypto-currency – go here —>>> http://qoinpro.com
And we know that Russia is taking its own revenge as they unload U.S. Treasuries. Unknown to the world until recently was what they were doing with their money. Well now we know. According to Billionaire Eric Sprott, here’s what he had to say in a May 28th report…
“Since the economic crisis began, Russia has unloaded an estimated $50 billion in U.S. Treasuries.
Until recently, investors were unsure of what Russia would do with the proceeds of them. Last week, the Central Bank of Russia shed some light on that question when it disclosed that it acquired an additional 900,000 ounces of gold in the month of April.
This brought Russian gold holdings to 34.4 million ounces, making it a major and actively growing player in the world gold market.
Since 2006, Russia has been acquiring the yellow metal at a rapid rate.
On average, they have been adding 0.5 million ounces per month to their reserves, as seen in the chart below.”
|Russian Gold Reserves – Source – Eric Sprott of Sprott Money|
And if you think that the recent price fall of Gold and Silver over the last 2+ years portends what is to come, then perhaps you ought to check out a chart I posted in a previous post, that showed how the Gold price responded in the 1970s. Two major arcs from the late 1960s, to early 1980.
Are we seeing the same processes played out, but over a longer timescale, as the baby-boomer generation retire, and in retiring, their pension companies sell their investment portfolios, to raise the capital to pay the income, or to buy the annuity. That constant drip drip of selling – 10,000 per day in the U.S. alone, and a similar number in Europe, is the driver of the stock markets in the absence of Central Bank Quantitative Easing. As Fed QE is tapered, this trend may re-assert itself.
Once the number of pensioners retiring begins to fall – circa 2018 to 2019, then we should see inflation beginning to rise – possibly precipitously.
Just like in 1978. The time to buy any silver or Gold will be in the next year or so, to sock it away ready for the J-Curve, I mentioned in one of my posts last year.
And if you want some Silver or Gold, then here’s a great way to buy it, as the price reaches its interim lows. Liberty Silver
So, It’s Monday again, the weekend is behind us, fun over for another 5 days of slog…
And after thinking about my week-end, I got to thinking about money, and recent posts I’d made. Thanks too to those now following events here…
As I recently mentioned IBM, I’ll kick off with that. As I previously mentioned, IBM’s sales in China are down 40% on last year, and that begs the question.., What is happening with the other American Tech behemoths?
If you’re a stock-market Trader, or Options, CFD’s, or Spread-Trading specialist, this might be the time to do a little digging to see if there are shorting opportunities. (I know this is contentious for some people, but it provides liquidity, and makes prices lower to buy, or sometimes just exposes risks that are not yet so widely known)
Anyway, this whole NSA scandal is making news, as a European Parliament commission headed over to the U.S. last week, for talks with legislators to get answers to questions, and raise concerns of Privacy, Security, and Industrial Espionage – after all, with so much technology in use worldwide, if one country can just skim the internet for traffic, and store that away in some digital bunker, while they sift through it, because they have the technological edge, then the rest of the world might begin to mistrust that country, and that can affect international trade, and also spark developments outside the country, which might in itself lead to the very concerns that led to WW2, in the aftermath of WW1…
We already know that many middle-eastern countries mistrust the U.S., and the Russians, and Chinese have a long standing concern over American dominance, it is not outside the bounds of possibility that if unemployment rises world-wide, through lowering of trade, this will not only affect stock-markets worldwide, but also likely increase QE*, which many already believe is anathema, and lead to digital isolationism, protectionism or worse.
We have to remember though, that the Americans are becoming just a little paranoid – the Twin Towers attack, was the modern equivalent of the Pearl Harbour attack, and that woke the slumbering beast, with disastrous consequences for the country that did it… (I wouldn’t be surprised to learn that the reason that the Americans dropped the two bombs on Hiroshima, and Nagasaki, was because of feelings of retribution… Anyway perhaps we shall see in the fullness of time)
Some say that the U.S. isolationism, is at the heart of their problems, because so few Americans travel overseas they lack perspective. I worked there in the Tech-boom, at Dell HQ, in Roundrock, Texas, and to be honest the people I worked with were lovely – especially a certain lady, half of European ancestry, and half Native-American – If you’re out there – I’d love to hear from you btw, but their media, was only interested in the U.S., or if the President ventured overseas. It’s a no wonder George Dubya, struggled with his geography. (amongst other things)
So back to money matters. The U.S. gained prominance on the back of its technology. The DARPA agency (Defence Advanced Research Projects Agency) began research into the use of computer communication in 1969, which ultimately led to the internet, and to U.S. dominance of the tech-sphere, but it could be coming to an end, as India and China now have space exploration programmes, and their high-tech grads are making serious intellectual improvements – I heard recently that India has a Mars mission planned, so perhaps some research into Indian Space Technology Corporations is in order. (If you get a sniff of any, perhaps you’d let the rest of the followers here know – NO mere plugging though without supporting information)
Anyway, this post has rambled on for far longer than I imagined, so Until next time.
* QE – Quantitative Easing if you’re not already aware – A euphemism for printing more money to dilute the buying power of all existing currency by debasing the currency and thus raising the cost of goods through price inflation. Incidentally, for non-historians – Germany, Zimbabwe, Yugoslavia, Austria, and Argentina, have all tried that to detrimental effect with Hyper-inflation.
(Read my book mentioned below if you want a fuller explanation – mentioned in one of the later chapters)
As Southern England recovers from the overnight ‘breeze’ – OK, wind speeds DID reach almost 100MPH, but as reports come in, apart from the 14year old boy who was dragged from a harbour wall by a passing wave yesterday – Sincerest condolences to his family btw, – no-one else has been reported as killed or injured, though trees were blown over, and there appears to be little long-term effect.
I was working in Southern England the last time that a Hurricane (that wasn’t – at least according to Michael Fish) passed by.
As the aftermath unfolded back then, and Britain counted the costs of fallen trees and debris strewn streets – Sevenoaks in Kent, lost six of the seven oaks of their namesake, the stock market, which had also been at record highs back then began to fall just two days later… (If you’re a Technical Analyst – check out the weekly RSI figures, as this suggests that the market is “toppy”)
Look out below.
And as the spat between Germany’s Angela Merkel, and the US’s, NSA, continues, the spy saga takes another turn. In a recently read column, in which the writer discussed things technological with LINUX originator – Linus Torvalds, he as good as confirmed that the NSA had asked him to insert a “back-door” into the kernel of the operating system – LINUX.
This begs the question whether Microsoft, Apple, Google, Oracle, and other Tech giants have had similar requests, and whether these software giants complied with them…
Maybe those outside of the U.S. might be reconsidering their technological options.
IBM, once known for its computer hardware and now principally its software and services has already reported a 40% decline in its Chinese business, down from last year’s highs. Perhaps Edward Snowden’s releases will have the biggest effect on America’s global dominance, as people outside America eschew American technology for security reasons.
There seems to be a growing distrust of all things American, and this can not do the US dollar any good in the longer term. As China recently suggested we need to see a “de-Americanised” world, perhaps this might be the straw that broke the Camel’s back as the saying goes.
The USD/EUR rate currently stands at 1:1.3810, and the GBP/USD is 1:1.6196 (as at 09:25).
We shall see where these trend to in the medium term. And if the dollar does decline, this can only strengthen those other alternatives to currency – REAL MONEY – Gold and Silver.
Gold currently stands at $1350.34, and Silver at $22.58 both down slightly on the day, but up from recent days.
Until next time.