Golden Minerals Company

Ben Bernanke, chairman of the Fed, said Wednesday that the agency was nearing the limits of its ability to help the unemployed.

The Federal Reserve made it plain on Wednesday that job creation had become its primary focus, announcing that it planned to continue suppressing interest rates so long as the unemployment rate remained above 6.5 percent.

It was the first time the nation’s central bank had publicized such a specific economic objective, underscoring the depth of its concern about the persistence of what the Fed chairman, Ben S. Bernanke, called “a waste of human and economic potential.”

To help reduce unemployment, the Fed said it would also continue monthly purchases of $85 billion in Treasury securities and mortgage-backed securities until job market conditions improved, extending a policy announced in September.

This must read story showed up on The New York Times website early yesterday afternoon...and it's courtesy of Roy Stephens. The link is here.

The Federal Reserve just unveiled historic policy measures as a result of its December policy meeting.

The Fed announced QE4 as expected, but it surprised markets by adopting quantitative thresholds tying monetary policy to a 6.5 percent unemployment rate target, as long as inflation stays below 2.5 percent.

Adoption of quantitative thresholds was thought by many to be introduced sometime in 2013.

Here's another report on the same press conference. This one was posted on the businessinsider.com Internet site yesterday afternoon...and it's also courtesy of Roy Stephens. The link is here.

The Federal Reserve's stimulus measures aren't having as strong an impact on the economy these days as people think, said former Fed Chairman Alan Greenspan.

Since the downturn, the Fed has sought to spur recovery by slashing interest rates to near zero and taken more unorthodox measures such as buying bonds like mortgage debt or Treasury holdings from banks, a stimulus tool known as quantitative easing that injects liquidity
into the economy to keep rates low and encourage investing and hiring...and critics dub quantitative easing as printing money out of thin air that will fuel inflationary pressures down the road.

Either way, the Fed's policies aren't having much of an impact, especially while banks hold off on lending out all that fresh money.

"I've not commented about Fed policy since I got out of office, but I will say this: that whatever the Fed is doing, whether you like it or not, it's not actually, in my judgment, having a major effect," Greenspan told CNBC.

Alan pretty much sums it up. But what is also apparent is that infinite money will, in time, destroy the currency and produce an inflation rate that will make your eyes glaze over. Any other outcome is now a myth. This story was posted on the moneynews.com Internet site on Tuesday afternoon...and I thank West Virginia reader Elliot Simon for sharing it with us. The link is here.

The U.S. government ran a budget deficit of $172 billion in November, the Treasury Department said Wednesday, pushing the shortfall for the first two months of fiscal 2013 to $292 billion.

In November, the government spent $334 billion and took in $162 billion in revenue.

For the fiscal year to date, the deficit is up 24% compared to the first two months of fiscal 2012.

This marketwatch.com story was posted on their Internet site early yesterday afternoon...and I thank Elliot Simon for his second offering in today's column. It's worth reading...and the link is here.

To say taxpayers made money from their investment in AIG is to libel the very concept of profit.

Come to think of it, it may well be a gross insult to the idea of investment too.

The Treasury Department announced on Tuesday it would get $7.6 billion from the sale of its remaining government-owned shares in American International Group, taking it to what was widely reported to be a profit of $22.7 billion on the bailout.

That's $182 billion well invested, is the clear implication, though even the Treasury seems wary of calling the bailout bucks profit, using the more bureaucratic "positive return" in its press release.

You can quibble with the figures - for example that math takes no account of the value of tax breaks AIG received as part of the deal - but the real problem is with the very concept of the government investing in public financial companies which would otherwise go bust.

This most excellent commentary showed up on the Reuters website early yesterday afternoon Eastern time...and I thank Washington state reader S.A. for bringing it to our attention. It's worth skimming...and the link is here.

Nine years ago, California Democrat Gray Davis became the first U.S. governor in 82 years to be recalled by voters. The state’s 20 million taxpayers still bear the cost of his four years and 10 months on the job.

Davis escalated salaries and benefits for 164,000 state workers, including a 34 percent raise for prison guards, the first of a series of steps in which he and successors saddled California with a legacy of dysfunction. Today, the state’s highest-paid employees make far more than comparable workers elsewhere in almost all job and wage categories, from public safety to health care, base pay to overtime.

Payroll data compiled by Bloomberg on 1.4 million public employees in the 12 most populous states show that California has set a pattern of lax management, inefficient operations and out-of-control costs. From coast to coast, states are cutting funding for schools, public safety and the poor as they struggle with fallout left by politicians who made pay-and-pension promises that taxpayers couldn’t afford.

This amazing story showed up on the Bloomberg website late Monday evening...and I thank reader Tom Germain for sending it our way. The link is here.

The Bank of England could be given a new mission statement and instructions to do more to boost growth in the struggling British economy, under plans being pushed by ministers.

The Daily Telegraph understands that senior Government figures are privately pressing the George Osborne, Chancellor to consider giving the Bank a new target of increasing the size of the economy.

Mr Osborne is also being urged to push the Bank of England to expand its controversial Quantitative Easing programme to find new ways to inject more new money into the financial system.

Questions about the Bank’s instructions from the Government were put in the public domain this week by Mark Carney, who will next year replace Sir Mervyn King as Governor.

It will soon be a world-wide money printing orgy like we have never seen before. This story was posted on the telegraph.co.uk Internet site late last night GMT...and I thank Manitoba reader Ulrike Marx for digging it up on our behalf. The link is here.

Europe clinched a deal on Thursday to give the European Central Bank new powers to supervise euro zone banks from 2014, embarking on the first step in a new phase of closer integration to help underpin the euro.

After more than 14 hours of talks and following months of tortuous negotiations, finance ministers from the European Union's 27 countries agreed to hand the ECB the authority to directly police at least 150 of the euro zone's biggest banks and intervene in smaller banks at the first sign of trouble.

"This is a big first step for banking union," EU Commissioner Michel Barnier told a news conference. "The ECB will play the pivotal role, there's no ambiguity about that."

This Reuters story was filed from Brussels early this morning...and it's Ulrike Marx's second offering in a row. The link is here.

The current investigation into Germany's biggest bank, Deutsche Bank, over suspected tax evasion has widened to include members of its management board.

The bank issued a statement on Wednesday following a police raid on its head office in Frankfurt saying prosecutors were also investigating Jürgen Fitschen, who became co-CEO this year, and Stefan Krause, the chief financial officer.

"Two of Deutsche Bank's management board members, Jürgen Fitschen and Stefan Krause, are involved in the investigations as they signed the value-added tax statement for 2009," Deutsche Bank said in a statement.

This story showed up on the German website spiegel.de yesterday...and it's another article from Roy Stephens. The link is here.

Chancellor Merkel has more power in Europe than any of her postwar predecessors. Yet there is little passion in her relationship with the EU, preferring instead a strategy of what can only be described as pedagogical imperialism. She sees the bloc primarily in terms of euros and cents -- and worries that it is rapidly losing relevance.

She currently holds the fate of Europe in her hands. If the euro is rescued, Merkel will get most of the credit, and if it falls apart, she will be forced to shoulder the blame. No other German chancellor has had as much power on the European continent as Merkel. And yet, ironically enough, none of Merkel's predecessors were as dispassionate about the European Union as the woman currently governing from the Chancellery. Merkel is different.

For Merkel, Europe is no dream, vision or object of desire. She has since learned that it is part of the Christian Democratic etiquette to sugarcoat Europe with pathos, which is one of the reasons she traveled to Oslo on Monday for the presentation of the Nobel Peace Prize to the EU. It was, however, little more than a show for the public. In the end Europe, for Merkel, is a question of prosperity, of euros and cents -- and not a matter of the heart.

This essay showed up on the spiegel.de Internet site yesterday as well...and it's Roy Stephens final offering in today's column. The link is here.

The first is this must read commentary by GATA's secretary treasurer Chris Powell...and it's headlined "Holy Grail" Gold Evidence Panics Western Central Banks". The second blog is with Keith Barron...and it's entitled "All of My Bags Were Searched and They Were Looking For Money". The last blog is with Dr. Stephen Leeb. It bears the title "Buy Gold - Fed to Print Over $1,000,000,000,000 Per Year".

Reliance Money Precious Metal (RMPM), part of Anil Ambani-led Reliance Capital Limited, today said it is targeting enrolling over 10,000 jewellers and distributors across the country for its recently-launched My Gold Plan.

"We are aiming to aggressively increase our distribution and fulfilment reach across India for our gold accumulation plan by enrolling around 10,000 jewellers and distributors within the current financial year," Reliance Money Precious Metals Business Head-Gold Rishit Sanghvi said.

At present, RMPM has over 2,000 approved distributors and jewellers across the country.

Recently, Reliance Money launched My Gold Plan whereby customer can invest a minimum of Rs 1,000 per month which would be used for buying gold and customer can redeem the same for 24 karat pure gold coins or jewellery at the end of [the] scheme.

One hopes that this is a legitimate enterprise or, at worst, a fractional gold banking scheme. Every fiber of my being screams out to the Indian people..."don't go for it!" The article was posted on the indianexpress.com Internet site early yesterday afternoon India Standard Time...and I thank Ulrike Marx for bringing it to our attention. The link is here.

Revising a 19th-century U.S. law that governs the mining of gold and other precious metals could add billions of dollars to federal coffers at a time of tight budgets, according to some Democratic lawmakers and a government study released on Wednesday.

Taxpayers receive no royalties on metals pulled from federal land, and officials drew a blank when they tried to find out how much gold, silver, copper and other valuable metal is sold.

But applying a metals levy of 12.5 percent - the benchmark government share for other resources - could deliver hundreds of millions of dollars a year to taxpayers, according to independent studies and U.S. Representative Raul Grijalva, who sought the report and other data from the mining industry.

I ran this article past the Casey Research 'brain trust' yesterday...and this is what Louis James had to say about it..."Old story; they've been talking about this for years. Now, if federal royalty legislation actually gains momentum in 2013, that will be a concern, but until it does, it's just hot air." This Reuters story from yesterday was picked up by the finance.yahoo.com Internet site...and I thank Ulrike Marx for her second story in a row. It's her last offering in today's column, as well...and the link is here.

With nary a glimmer of hope that economic sense will supplant political expedience, Stansberry & Associates Investment Research Founder Porter Stansberry expects rampant inflation to roar in once the cost of capital rises. How is he preparing himself? Stansberry tells The Gold Report he continues to buy and hold gold and also discusses how real estate can cushion against the fiscal cliff.

This interview was posted over at theaureport.com Internet site yesterday...and it's recommended reading. The link is here.

A little more than half of the gold of De Nederlandsche Bank is stored at the U.S. Federal Reserve in New York.

Furthermore, 20 percent is in the Canadian central bank in Ottawa, nearly 20 percent is located in London, and only 11 percent is at the DNB itself in Amsterdam.

That was said by Dutch Finance Minister Jeroen Dijsselbloem in response to parliamentary questions from Christian Democratic Appeal Member of Parliament Eddy Hijum.

The English translation of this very short Dutch story posted on the nu.nl Internet site yesterday is embedded in a GATA release...and the link is here.

Financial journalist Lars Schall, who in recent months has gotten the doors of several central banks slammed in his face when he has asked them pointed questions about gold, reports today that he is doing a little better with the German Bundesbank as a result of similar inquiries made by the London Telegraph's Ambrose Evans-Pritchard. Schall's commentary is headlined "The Deutsche Bundesbank and Its Gold: To Trade or Not to Trade?" and it's posted at his Internet site here:

The Bundesbank still has not answered whether it loans or swaps gold or if it ever did and, if so, for what purposes. But these questions are being pressed more often now and eventually will blow up messily all over Western central banking -- sooner if mainstream financial journalists like Evans-Pritchard start pressing the questions for their own news organizations.

I thank Chris Powell for wordsmithing "all of the above"...and Schall's commentary is headlined "The Deutsche Bundesbank and Its Gold: To Trade or Not to Trade?". It's posted at the larsschall.com Internet site...and the link is here.

In their latest market letter, Lee Quaintance and Paul Brodsky of QB Asset Management in New York add credence to speculation that the gold price could not have been so restrained lately without the assistance of China and Russia and maybe even Japan and South Korea, all eager to hedge their dollar exposure with gold but unable to get it in size without a long period of price suppression.

Quaintance and Brodsky write:

"According to most dyed-in-the-wool hard-money advocates, there is a 'gold cartel' that suppresses the gold price. They tend to argue that U.S. banks continually short gold (and silver) futures nakedly, clipping significant yield each quarter without sufficient metal in stock to deliver to futures buyers if exercised.

The paragraphs above are only part of the commentary offered by Chris Powell in this must read GATA release from yesterday...and the link is here.