Keiser Report: Clowns Run World (E202)

This week Max Keiser and co-host, Stacy Herbert, discuss David Cameron, STFU going viral, Riot Granny in Athens and Gaddafi's alleged net worth. In the second half of the show, Max interviews John Perry Barlow about financial activism, capitalism, Marxism and a plutocratic cancer on the economy.

Repost: Why A €1 Trillion EFSF Is Not A "Bazooka" But A "Peashooter", And Is Woefully Inadequate

The most important news of the night is not that the Greek haircut will be 50%, which is still insufficient as it excludes ECB Greek debt holdings, plus as the IMF noted, a 60% NPV haircut on all bonds is needed for Greece to return to viability, but that the EFSF will be just €1 trillion. Unfortunately, the EU Council and its advisor, JPM, refused to read the Zero Hedge analysis on why anything less than €2.4 trillion is insufficient (not to mention assumes no French AAA-downgrade... ever). Which is why we repost it for whatever sentient carbon-based life forms are left to realize why tonight's Euro TARP should be promptly faded until it is at least doubled to well €2 trillion, which, alas is impossible: absent Uncle Sam footing €250 billion solely to bailout French banks, this will not work!

- Read the full story here:

http://www.zerohedge.com/news/repost-why-%E2%82%AC1-trillion-efsf-not-bazooka-peashooter-and-woefully-inadequate

Ron Paul: "Blame The Fed For The Financial Crisis"

To know what is wrong with the Federal Reserve, one must first understand the nature of money. Money is like any other good in our economy that emerges from the market to satisfy the needs and wants of consumers. Its particular usefulness is that it helps facilitate indirect exchange, making it easier for us to buy and sell goods because there is a common way of measuring their value. Money is not a government phenomenon, and it need not and should not be managed by government. When central banks like the Fed manage money they are engaging in price fixing, which leads not to prosperity but to disaster.

- Read the full article here:

http://www.zerohedge.com/news/ron-paul-blame-fed-financial-crisis

London Trader - China Bought Massive Amount of Gold Today

“The price discount in gold is the most welcome thing to the entire Eastern Hemisphere. The Chinese are buying very relentlessly because they know what is going to happen. We had a major, major physical buy order today. The Chinese bought a massive amount of physical today at the lows.”

- London Trader via a King World News interview, Read the full interview here:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/10/21_London_Trader_-_China_Bought_Massive_Amount_of_Gold_Today.html

SocGen Asia Strategist Has Near Fit On Bloomberg TV After Making It Clear That It's All The Blogosphere's Fault

SocGen's Todd Martin, who is the bank's Asia equity strategist, appeared on Bloomberg earlier today to discuss the Volcker Rule and prop trading, against which the anonymous blogosphere had some very "strong views" back in 2009 before anyone had even considered prop trading. Sure enough, prop trading ended a few months later with the adoption of the Volcker Rule. Somehow, the topic of the Volcker rule shifted to the topic of whether or not Morgan Stanley is exposed to France, and its insolvent banks (ahem), and who is to blame. Take a wild guess on Mr. Martin's opinion in the matter: "For example one blog just a week ago, had a very, very strong view against Morgan Stanley. They quoted Sanford Bernstein who actually was telling people to buy the stock. And then they were quoting Gross Exposures not Net, and then concluding that Morgan Stanley had to go down and be dismembered [sic]. Now I have a serious problem with this.... If I get regulated why isn't this place regulated. It's also very dangerous because they are using psudonames [sic] and we don't know who they are. They could be the guy on the street. They could be a hedge fund dangling out information. It could be the head of a prop desk. Thing is it is supposed to be regulated. And they get their revenues from trading platforms on US soil. And I don't think it's fair. And I think the US should go and take a look and regulate the blogosphere. I think it's really, really out of control." In other words: it is all the blogosphere's fault.

- Read the full article and see the video here:

http://www.zerohedge.com/news/socgen-asia-strategist-has-near-fit-bloomberg-tv-after-making-it-clear-its-all-blogospheres-fau

So Much For EURUSD Breaking 1.3800: S&P Cuts Spain To AA- From AA

UPDATE: EURUSD loses 1.3750

On Oct. 13, 2011, Standard & Poor's Ratings Services lowered the long-term rating on the Kingdom of Spain from 'AA' to 'AA-', while affirming the short-term ratings at 'A-1+'. The outlook is negative. The transfer and convertibility assessment remains 'AAA', as it does for all members of the eurozone. The negative outlook reflects our view of the risks to Spain's economic growth linked to private sector deleveraging, external financing pressures, and their impact on budgetary consolidation. We could lower the ratings again if, consistent with our downside scenario, the economy contracts in 2012, Spain's fiscal position significantly deviates from the government's budgetary targets, or additional labor market and other growth-enhancing reforms are delayed. Conversely, we could revise the outlook to stable if, consistent with our upside scenario, the government meets its budgetary targets in 2011 and 2012, risks to external financing conditions subside, and Spain's economic growth prospects prove to be more buoyant than we currently assume.

- Read the full article at Zero Hedge here:

http://www.zerohedge.com/news/so-much-eurusd-breaking-13800-sp-cuts-spain-aa-aa

Keiser Report: Price Propaganda (E194)

This week Max Keiser and co-host, Stacy Herbert, talk about pitchforks trading up, the mother of all short squeezes and the anonymous hedge fund. In the second half of the show, Max Keiser interviews Professor Steve Keen, author of Debunking Economics 2, about occupy wallstreet, debt bubbles and Australian housing.

Ben Davies - Buy Gold, The Only Option Left is to Print Money

"There is not doubt that we saw a mass on mass deleveraging across all asset classes. When I see people who do not understand the gold market, one the concept of the two-tiered market and two, they don’t understand that gold is actually a form of money. I don’t think they realize also how much money is being put into the system.

To my mind gold will not be falling back to $1,400. I believe that we have (already) seen the low. We have seen open interest collapse dramatically. I believe it’s done.”

- Ben Davies, via a recent King World News Interview:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/10/7_Ben_Davies_-_Buy_Gold,_The_Only_Option_Left_is_to_Print_Money.html

Fitch Downgrades Italy To A+, Outlook Negative

Fitch Ratings-London/Milan-07 October 2011: Fitch Ratings has downgraded the Italian Republic's (Italy) foreign and local currency Long-term Issuer Default Ratings (IDRs) from 'AA-' (AA minus) to 'A+' (A plus) and the short-term rating from 'F1+' to 'F1'. The Outlook on the long-term ratings is Negative. The Country Ceiling of 'AAA' has also been affirmed. The downgrade reflects the intensification of the Euro zone crisis that constitutes a significant financial and economic shock which has weakened Italy's sovereign risk profile. As Fitch has cautioned previously, a credible and comprehensive solution to the crisis is politically and technically complex and will take time to put in place and to earn the trust of investors. In the meantime, the crisis has adversely impacted financial stability and growth prospects across the region. However, the high level of public debt and fiscal financing requirement along with the low rate of potential growth rendered Italy especially vulnerable to such an external shock....

- Read the full story at ZeroHedge here:

http://www.zerohedge.com/news/fitch-downgrades-italy-outlook-negative

London Trader - Physical Demand for Gold has Been Insatiable

"The Asians have been buying like crazy, all through this takedown they have been buying. We have seen massive premiums and bottlenecks in supply, they simply cannot get enough physical metal as the prices have dropped. The demand has literally been insatiable. As I have stated before, the central bank gold, which was used to sell the market down, has gone to vaults in Asia. That’s a one way trip, it doesn’t come back into the market...."

- London Trade, via a King World News Interview:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/10/3_London_Trader_-_Physical_Demand_for_Gold_has_Been_Insatiable.html

Asia stocks fall; Hong Kong drops 5 per cent

What?! Greece won't meet their deficit reduction promises?! How is this news? Everyone knows they won't meet any of these hollow promises.

"Asian stock markets tumbled Monday as sentiment took a hit from a weakening economic picture in Europe and Greece’s admission it won’t meet its deficit reduction target despite austerity..."

- Read the full story at the Globe and Mail here:

http://www.theglobeandmail.com/globe-investor/asia-stocks-fall-hong-kong-drops-5-per-cent/article2188430/

Michael Pento - Why Investors Should Buy Gold Now

“Likewise, an economic slowdown won’t hurt gold prices this time around either, as long as Bernanke does not sit on his hands for 6 months. With Europe teetering on default, investors can be assured that the European Central Bank and the U.S. Fed will not allow another half year of deflation and money supply contraction to send the global financial system into ruins. Once an economy becomes fully addicted to inflation it is very hard to kick the habit.

Investors must understand that global central banks will do everything in their power to avoid reality and try to keep the credit bubble from bursting on both sides of the Atlantic. That’s why taking advantage of this recent pull back in gold may be the smartest move.”

- Michael Pento, via a King World News Interview:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/10/1_Michael_Pento_-_Why_Investors_Should_Buy_Gold_Now.html