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Category: Richard De Graff

  • POOR RICHARDS REPORT PART THREE

    POOR RICHARDS REPORT PART THREE

    P00R RICHARDS REPORT
    PART 3
    It is the banks!
    The Trumpets Are Roaring
    Part 3
    You’ll remember, of course, that 2013 was the most significant year for deposits/withdrawals in GLD and SLV. As gold prices fell more than $400 from the start of 2013, around 40% of the total metal holdings in GLD came to be liquidated and withdrawn, as GLD investors did what investors typically do in a dramatic decline following a decade of advances—sell.
    However, in SLV, the logical script wasn’t followed in 2013—and is not being followed very recently. Despite an even larger price decline in silver than experienced in gold, no net withdrawal occurred in SLV in 2013. I feel there probably was liquidation in SLV, but that selling was absorbed by new buying as metal changed hands and a good chunk ended up being owned by JPMorgan. Further, JPM was able to evade SEC reporting requirements which would have revealed its ownership by methodically converting shares into metal, where ownership reporting doesn’t exist. – Silver analyst Ted Butler: 02 July 2014

    P Morgan Chase
    If there is one single factor responsible for the long term silver manipulation it was the concentrated short position, of which JPMorgan has been the kingpin of since acquiring Bear Stearns in 2008. Given all the history, circumstances and stakes to certain large financial and regulatory institutions, I’m convinced that the price of silver would have already blown off were it not for the concentrated short position. The concentrated silver short position was always too large; which became clear in time by the damage it did to Bear Stearns. It also seems clear that because the concentrated short position was transferred to JPMorgan, the regulators have looked aside as JPMorgan and the CME Group resorted to a series of dirty tricks to assure silver prices would decline so that the concentrated short position could be protected and reduced.” – Silver analyst Ted Butler: 07 June 2014.

    It is rather obvious that the silver and gold manipulation has been going on since 2008 has the blessings of the present administration.
    Every legal and moral law has been broken.
    As I have stated before when a major power starts doing grandiose entitlement programs without sufficient funds or taxes to fund the programs major banks gain control of government.
    They do this by annulling laws that were passed generations ago to protect the public domain.
    FDR’s reforms were a disaster, but his use of the radio and WWII bailed him out. His communication skills were what gained him reelection. Plus the fact that Governor Dewey of NY failed to clean up Albany County for the 1940 elections and the republican party was left without a viable candidate.
    It was not until Dwight Eisenhower became President that the economy had really grown. The Interstate Highway System put millions to work, increased productivity and opened new areas for expansion.
    His naysayers point out the fact that he did not lower taxes. In fact he had the FED tighten credit ever so slightly to slow down growth. He called it “Pushing on a string” to calm the economy down. This led to mini recessions or minor corrections. By today’s standards on a Band-Aid was needed. One reason for his success was that he had one of his centuries ablest majority leaders in the US Senate. Lyndon Baines Johnson a future President. President Eisenhower had the backing and respect of both political parties because of his leadership role in WW1!
    I believe he refused to lower taxes because it would be like putting Powerball winnings into the general public hands at once. Most large winners regret their winnings.
    President Kennedy did lower taxes and that was about all. He was mainly known for his ideas. He would not have had a single bill passed and probably would never have been able to run for reelection, because of his use of illegal drugs to relieve back pain from an injury he received during WW II WWII. That was why, I believe his body was transferred to John Hopkins’s hospital for the autopsy. They had very little experience in this area.
    Lyndon Baines Johnson did a herculean task by passing all of Kennedy’s bills. He knew where all the votes were and how to get them.
    He was even able to get the civil rights bill passed with Republican support despite Barry Goldwater’s vote. That one vote cost the Republican Party dearly in future years.
    President Johnson up to this point was a “game changer” in a positive sense. His Medicare and Medicaid laws along with his backing of the Vietnam War turned his greatness into shambles because the King Cobra of poisonous snakes was slithering through Congress. Our dollar weakened and foreign governments convert their currencies for dollars and then demanded gold. It was a no brainier trade and the US Stockpile of gold would soon be dissipated.
    This forced President Nixon to take US Dollar off the gold standard and the lid came off Congressional spending.
    Inflation with King Cobra was sending interest rates sky high as Federal Chairman Paul Volker started fighting an epic battle.
    Up to this point in time the United States added a Usury Law. The maximum rate that banks and Credit Card companies could charge was 8%. At that time one could buy short term government paper or agencies for 90 days at over 20%. So the general public would max out their debts and buy agencies paper and net 12%.
    This would break our financial system so. The congress quietly rescinded the Usury Law. Score one in favor of the banks.
    “Man’s greatest invention was Compound interest.” quoted Albert Einstein. The safe guards that were put in place during the 1930’s and early 1940’s were being swallowed by nasty King Cobra.
    The final piece would be canceling the Glass- Stiegel Act in the 1990’s. This allowed brokers and bankers to merge. Instant profits for them and the public be dammed.
    A banker’s mantra is to control the flow of money. To be truly successful they must control the government. This would take time, but all the pieces of the puzzle had been turned over.
    Now it seems the government needs JP Morgan Chase to keep the lid on silver and gold or we might wake up some morning and find our securities quoted BW-OW (Bid wanted – offer wanted).
    We are moving closer towards the edge of a bottomless pit

  • 2013

    2013

    2013

              I have been a Real Stockbroker for over 55 years now and I love it! One reason for my longevity is that I have learned to look at the whole picture. Not just the good looking lady in the center. Others tend to concentrate on their specialty and are often blindsided by an “unforeseen event”.

    The good news is that the economy is in a rebuilding process, despite the greedy players in the market place.

    Our main growth will come from natural gas and exporting it to Asian and European countries. Stem cell research will pay huge dividends in the health care area. I will write more about these situations later and the investment opportunities available to the patient investor.

    There is a pattern that is just developing and is very disturbing because of the implications. Gold bullion is being taken to their home countries because, I believe, that we are not trusted as much as we were. We have a weak dollar and have not passed a budget for years, and worse yet our debt ratio to GDP is over 90%. First it was Venezuela and then Iran wanted their gold bullion shipped to them. Then the Queen of England did a tour of the Bank of England’s vault with big smiles. Why would they drag the Queen down to their bank vaults  for the whole world to see?

    Is it because J P Morgan Chase bank is flouting the law  by illegally manipulating the price of gold and silver in the commodity market?

    Has Germany, with a very strong economic balance sheet, asked for their deposits back?  After WWII their gold was deposited in various countries as a safeguard. This is just the tip of the iceberg.

    What is it that the central bankers fear? Collapse of the dollar or devaluation? That is a distinct possibility if our Congress does not settle down to do it’s own business. ( The House creates a budget and the senate approves and then it is sent to the President- this is part of the checks and balances built into our system of government.)

    Are they worried that the President will confiscate their holdings to suit his needs? Charles Krauthammer on FOX TV once editorialized “that do not listen to him, but WATCH what he does”. Presidents since Ronald Reagan have had disillusioned second terms.

    Now that I have used up my disclaimers here are my predictions for 2013.

    OPEC cartel will come crumbling down. History has proven that cartels do not last, but this one has lasted a long time supported in a way by the United States. Why? There has not been an oil refinery built since 1974!

    Despite what our government can do, it is powerless in controlling the American entrepreneurship. The hydraulic fracking of shale oil has unleashed billions of metric cubic feet (Mcf) in natural gas fields. We are now the Saudi Arabia for natural gas. As we convert from oil to gas , the loss of OPEC’s biggest customer will raise havoc among cartel members and some will begin to cheat. As the price drops, some oil companies will find it tough sledding on the interest rate slopes. They will find it very tough to service their debt obligations at lower prices. These fields could last for centuries. There is a field that starts in Pennsylvania through New York State well into our borders in Canada.

    This will be boom for companies that are energy dependent for cheap fuel.

    A new industry has been kick started. Converting natural gas to Liquid natural gas. Right now there is one company that built a plant in the 1980’s to IMPORT natural gas. They reversed the process and are the only US company that has approval for exporting. They own 2 tankers that are running at full capacity. It takes time to build the ships and time to build the plants but eventually our balance of payments problem will reverse. With natural gas selling for under $3.50 mcf here and in Europe and Asia north to $7.00 plus; it will be a no brainer unless the government  muddies the waters  with inane provisos.

    Right now there are 6 companies awaiting the President’s approval to begin building the plants.

    The world as of today has copied or bastardized our ability to borrow or print money. The problem is that they do not have people power or natural resource capabilities to maintain the lifestyles they desire now.

    China, Japan, Russia AND Europe have declining populations. In Japan they sell more adult diapers than baby diapers. Only in Asia do they have expanding populations. That means growth. Kids need many items in order to survive. One should look to Asian countries that have governments for investment ideas.

    Pension plans face a disaster if they have been currently buying US Government bonds. There will come a day when interest rates will have to rise and that will cut their prices in half or more. The only way out of this heroin addicted low interest rates is devaluation. If the government devalues by 20% that means you will have 20% more dollars and prices of everything will drop by 20%. Except silver and gold. They should rise by 20% .

    It is reported, using government agencies figures, that JP Morgan Chase is short 45% of silver stored in COMEX warehouses worldwide. This equals 25% of the known world production.   (When one sells short they sell something that they do not own and hope to buy it back at a lower price. ) Thus the price of silver could explode above the price of gold in a short covering rally because there are no stockpiles of silver like there is for oil.

    There are four companies one can purchase to protect their hind quarters.

    Stems cells are going to be the real game changer. Don’t fret – they are not made from human embryos.

    These companies can work with vaccines which is far cheaper than drug research. For a few million dollars they can work on a vaccine and determine if it is doable in just six months. If the mass population is involved then they must seek FDA approval. But here the waiting period is short.

    An example of this is Nannovercides (NNVC $.50) which has developed a pill for the flu vaccine. It supposedly is more effective than the flu shot, but since it involves millions of people the FDA is cautious about approval.

    There are companies that can regenerate body organs, restore sight, monitor blood sugar and all kinds of sterile non harmful injections.

    Many of these companies are being financed by major drug companies so they have staying power. The problem is that it takes time for fruition, but it is there I believe.

    There is a major drug company that is researching over 200,000 different compounds but not a single vaccine.

    The bottom line here is that this industry will extend the average human life and the average age will be over 110. This means extending social security retirements to 80, then 85 and eventually 100. Governments are going to reform or go broke.

    The entitlement programs that are around today will become late night jokes on TV. This change will be both smooth and bumpy depending upon which social adjustment will be effective.

    INSURANCE COMPANIES WILL HAVE TO READJUST ALONG WITH ALL KINDS OF AGE RELATED INDUSTRIES.           Imagine taking an early retirement at 85 so you can visit the moon!

    My point is start thinking about star treckie stuff. Don’t get caught in the  “I remember when” trap.  Always look forward.

    Do not tie your funds in non-liquid investments. Do not speculate because no one can tell you when and where the hammer and axe will fall.

    Use common sense and always look around you and observe what is going on.

    Those of us seeking income better have an attitude change. Income securities are fine when you can truly find them, but eventually interest rates have to return to normal and that spells losses for bond holder and income stocks. Eventually this will happen so it is wise to invest in solid companies and to sell some shares when income is needed.

    As we grow older and mature more, and hopefully wiser, we must also change our preconceived ideas of wise management.

    An example of this is that one buys a home to live in and prosper in the community – not to make money.

    So today, January 2013, Precious metals, Natural gas stocks and associated businesses along with stem cell securities and CASH. Not money market funds – cash. Cash is King!

    We are entering an era that will be challenging and exciting and fortunes can be made, but when and where is still to be determined.

    Cheerio !~!!

     

  • JPMorgan – Above The Law?

    JPMorgan – Above The Law?

     

     

    One of the world’s most powerful banks today is JP Morgan Chase. Their Chairman, whose name only has to appear in any leading media and 95% of the readers will recognize the name with JP Morgan Chase.Yet the most powerful always have skeletons in their closets: an Achilles Heel. Today it is easy to find them. If you type “JP Morgan” into Google, you will get 6444,000hits. Then search: “silver manipulation”, which will give you 225,000 results in .38 seconds, you will see JP Morgan is in all the top hits.

    One does not have to be a Rhodes scholar to find the bad apple. The price of gold is above $1,700.00 an ounce and silver is slightly above $31.00 an ounce. Yet there is three times as much gold as there is silver in the known world supply.  Central banks buy gold. They are the major buyers at this price. It is also used in making Jewelry.  That is about it.

    Now silver on the other hand, is the best conductor of electricity. It is also used in mirrors, solar panels and all kinds of medical supplies. In the COMEX (Commodities Option Metal Exchange) warehouses worldwide, more silver is being delivered than deposited. The bottom line is that demand is outstripping supply.

    Now, November 2012, JP Morgan is short 32% the silver commodity while the legal short position is supposed to be 5%. It is a clear signal of market manipulation. A short position means that a seller has borrowed a security or a commodity contract from an owner so he can deliver what he has sold to the buyer. He then hopes to be able to buy back at a lower price and return it to the loaner. He is doing the reverse of buy low sell high. He sells high first and buys back lower later-hopefully. The risk is when one buys, one can lose what he paid for it. In a short sale, one’s risk is limitless.

    Now for JP Morgan Chase to do this successfully they need three transactions or events to take place.

    • They need a source of cheap money and low margin rates. The Federal Reserve policy for banking institutions, not individuals or corporations, will provide funds at almost or zero percent interest. This could amount to a billion or more?
    •  They need the use of a High Frequency Trade, or HFT, to set up the operation. This is done by an expensive computer program, which can, in a nanosecond, show a humongous amount of sell orders that will drive the buyers into the woodwork. This drops the price and as is the case with commodities, a sharp drop in price brings on margin calls. Margin calls bring on sell orders and the short sellers buy back in at a profit. This is morally illegal and HFT’s should be banned. Margin rates should be raised, because in the past economic tragedies easy credit breeds contempt for the rules of fair play.
    • The third ingredient into Satan’s Stew is unscrupulous politicians and government henchmen.

    Let us start with the chain of command in the commodity markets. The Commodity Future Rate Commission is made up of five individuals whose main task is to insure fair trades and stop manipulation. This is a most important mandate because the commodity price can influence the real product and cause economic disruptions worldwide. An example can be when some bright individual decided it would be a good and profitable idea to start an exchange trade fund in the commodity of corn. To start the fund they had to buy futures of corn. This raised the price and the speculators climbed on board. This caused the price of flour to increase.  Countries like Egypt buy their corn meal from the United States. With the sudden price increase the Egyptian bread makers have to raise their prices. This, I believe, was the cause of the fiasco in Egypt in the last two years.  These Commissioners have a highly responsible mandate: to keep the markets honest.

    When it comes to silver manipulation they are stonewalling.  In the old days they would have been tarred and feathered and sent out of town on a rail!

    Now here is a rule. No politician will go out on the proverbial limb without a backup.

    So we must go up the ladder of the chain of command.  I will let you dear reader, speculate how far up the ladder it will go.

    This manipulation is so large that to keep everyone quiet is beyond belief. Where and what are the members of Congress doing? Why has there not been a special investigation? Are members of the various finance committees being paid off?   How much money was spent on their reelection?

    Now the big puzzle: A leading market letter writer, Ted Butler, has written letters to the Chairman of the Board, Jamie Diamond, and all the directors of the bank. Not one single reply as of this writing. 11/13/2012.

    This is my belief about the whole mess.  Our paper currency system is teetering worldwide as our financial system is in chaos. When government bills have a negative yield that represents real fear. The world is awash in debt while the public is de-leveraging. That is deflationary.

    The precious metal markets are being manipulated with paper currency. If JP Morgan were forced to “cover” its short positions it would take over 100 days and the price of silver would surpass that of gold on a temporary basis. There is not a government stockpile of silver to bail out the bank.

    This would be an inflationary shock for the world. It would crash governments and force countries to go back to the gold and silver standard.

    One thing is for sure. Governments cannot manipulate everything all the time. Once individual initiative is wasted – they will crumble of their own weight.

    What will happen with the puppet politicians that believe they rule the world?

    What will happen to us?

     

  • IT CAN NOT HAPPEN TO ME. GUESS WHAT? CHPATER 21 CONCLUSION

    IT CAN NOT HAPPEN TO ME. GUESS WHAT? CHPATER 21 CONCLUSION

    IT CAN NOT HAPPEN TO ME. GUESS WHAT? IT WILL!!!

    Many the soothsayers and economists are predicting a perfect financial storm, but none, to my knowledge, are writing about the solutions to our dire problems. This book has been a meager attempt to provide an affirmative future for our offspring. This is just a meager start, but remember to keep it simple and pure in thought word and deed. (RD) 

    CHAPTER 21 PSALMS 50: 22-23  

    CONCLUSION: ITS’ THE BANKS

    It is the Almighty God that creates wealth and takes it away when you abuse it. Just peruse the Old Testament and read about all the wealth King Solomon had. By the time Jesus was born the Jews were dirt poor.

    Whether you believe in the Bible or not there are lessons to be learned from mistakes made over 2,500 years ago. Abuse your wealth by greed, piggishness, vanity, insolence, scorn or political corruption in any form and the almighty will eventually dethrone you.

    The stock market crash of 1929 and precursor to the Great Depression worldwide can be attributed to one faulty or bogus principle.  Easy credit! Anyone could purchase a security by just putting down 10% of the purchase price. This was done in order that major players had someone to complete their trade with. There were all kinds off “stock pools” that were created to con or swipe the unprotected. Today they are called Hedge funds and bankers.

    When banks or bankers consider themselves above the law it is time for the legislators to change the rules.  2011-2012 has been rife will all kinds of currency crises.  Most all the solutions are about saving the banks. Bankers in turn testify they are trying to save jobs. In reality it is THEIR jobs they are trying to save – not ours.

    So everyone onMain Streetstarted buying stocks. As long as the market was going up everyone was happy.

    Lurking behind the curtain are arrogant billionaires pulling the strings of their puppet politicians. When bankers control the economy along with a socialist government then eventually everyone looses. There is a saying, when the politicians sleep at night, the economy grows.

    Presidents #43 and #44 have blown the recovery. The right choice was to allow bankruptcies to take their normal course. Joseph Schumpeter’s law of Creative Destruction would have created many new jobs and industries.

    If #43 had delivered a whopping sum of $250,000 -$300,000 to every adult that paid an income tax the banks would be solvent and awash with cash. The public would have spent the monies where it is treated best creating businesses and jobs.

    Now we face a herculean task of revamping the worldwide financial system. Those countries do not have a free economic system and should be avoided, because major decisions are made for political instead of economic reasons.

    Every major bank should be downsized. Trust departments and brokerage departments removed from the bank and separate companies formed as stand alone or combined with other former trust departments. Banks will not have any trading departments, but will be able to buy and sell from their own account through a third party- preferably a new brokerage firm/

    Banks shall not have any debt or preferred stock. Banks have the Federal Reserve privileges which we as citizens do not enjoy.

    Banks will be limited in size with grouping of A, B, and C. A banks will be regional, maybe based upon the Federal Reserve districts.  Their salaries will have a maximum cap and will change depending upon the performance of the bank.  Department heads and employees will have the same incentive. These banks could trade as a public security providing the Federal Reserve owns 51% .

    When these banks are bidding for major national or international projects then they can form syndicates for business. One bank could be the lead or major underwriter with each bank promising so much monies if their bid is successful.

    “B” banks should be limited to state business and all be privately held by the federal reserve. They should be able to form syndicates for interstate business but not national.

    “C” banks are local banks that will be non public holdings. They will operate in small towns and be allowed to compete for business where a community has only one bank. Communities with a single bank tend to stagnate in economic growth.

    The board of Directors of these banks shall not have any loans of any kind. They may have a checking and savings account. They shall be paid a friendly stipend to encourage participation on the board. Any fines , or censures, or losses in the bank will also be deducted from their stipend. They shall not have any margin accounts.

    Any member of a bank that commits a fraudulent act shall be fined and punished along with his or her entire family. This should include all assets of the entire family.

  • It can’t hppn t m.Gss Wht? T WLL! Chptr 20 “A Game Changer”

    It can’t hppn t m.Gss Wht? T WLL! Chptr 20 “A Game Changer”

    IT CAN NOT HAPPEN TO ME. GUESS WHAT?  IT WILL!!!

    CHAPTER 20

    GAME CHANGER!

    The major media is wring all about QE-3(more later), but the big bugaboo is debt; our debt your debt my debt. The entire world is swimming in debt and everyone is trying to deleverage (reducing debt) and that is deflationary. Deflation is worse than inflation because the economy slows down like a stream freezing over. The public puts off buying unless they really need it, because they know if one waits the price will come down.

    In most major elections an unforeseen event happens that changes the entire campaign around.

    An example would be the first debate between Kennedy and Nixon. When Richard Nixon heard John Kennedy refuse make-up for the first TV debate he also refused. What Richard Nixon did not realize was that John Kennedy already had a healthy looking tan.

    So when the debate started John Kennedy looked healthy and vibrant and Richard Nixon looked pale and haggard.

    The Financial Times Wednesday September 12, 2012 USAedition carries the headline: “Moody’s threat to strip US of Top rating.”

    There is one school of thought that that no matter what happens, bonds will keep on trading. This is true. The real question is at what price?  Lowering a credit rating is serious business. Moody’s is giving the Congress over a year’s warning. The real implication is we cannot spend more than we make till the crack of doom.

    This is a serious battle for the whole world. Moody’s rating agency is considered the leading agency on debt credit while Standard & Poor’s is considered tops in equity issues (common stock).

    Money can be made and lost by a single change (Moody’s) in a debt rating.

    The US Treasury securities are considered the world’s virginal risk free asset. In international trade funds are settled in US Treasury funds. All bond issues are priced off the similar US Treasury bond. The riskier the credit the higher the rate (interest coupon); thus the higher yield the credit risk!

    Another factor investors must realize is that bonds do not act like common stocks. When there are more buyers around than sellers; then demand is in control and stocks should rise.

    With bonds it is entirely different. If US Treasuries lose their AAA rating and it is downgraded to AA1; then all trades are halted until the computer programmer can change the rating lower and that drops the price.

    Poof goes the magic dragon! This like a lotus or Microsoft’s Excel spread sheets. If you have your bank statement on one and you go back and change one entry by a nickel and then press the send key to whole sheet changes and your current balance changes by that one nickel. A rating change can change the price of a bond by several points. This could mean all assets backed by the US Dollar automatically drop in value all over the world instantly.  Most sovereign debt will be affected also, unless they have a strong balance sheet. Problem is that most countries have some form of socialism which means higher debt. This debt will drop in value which means more monies to pay it back. This means higher taxes. Higher taxes lead to more bureaucracy which leads to a slower economy and a loss of individual freedom to pursue one’s dreams.

    FDR’s grand “New Deal” did not work. He had to raise taxes in 1938 and the economy started sliding down the slippery slope of Government spending.

    Hindsight can be beautiful and insightful. When the government spends on roads, buildings, someone has to pay for it. Today we call it Quantitative Easing or QE’s. Quantitative Easing does not work. They are buying up bad debt and bailing out poor financial people who made bad decisions in the first place. WE are heading down the same path thatJapantook.

    It is the people that make this country grow. Not the politicians inWashingtonD.C.that should create a positive atmosphere. One has to wonder that if all the government bailouts had been returned to the people – where would we be today? The shock treatment would have jolted us back to good health by this time and the world would be better off. This is my personal opinion dear reader.

    Joseph Schumpeter was correct in his creative Destruction Theory. It went something like this. When an industry starts to die out, it is replaced by a newer more creative industry. The Horse and Carriage and the buggy whip industry were replaced by the automobile. Where would we be today if the socialist kept supporting the carriage business because of jobs?

    So writing about jobs is not the mantra. It is debt. Moody’s has given the US Government until the end of 2013 to put its’ house in order.

    They might be too late. The end will come with a BANG!!! That could be when no one will submit $0.00 for a nations sovereign debt. A leading financial publication has already suggested Google is a better alternative to sovereign debt!  They could  have started the process of turning off the spigot that gushes out debt. No more smoking mirrors, we must elect real representatives that are not afraid to lead. WE must not be afraid to work out problems as a group, community. We must work together for the common good. If we fail to act now then the Part One of this book will be forced upon us as effect and cause and not cause an effect.

    The first step would be for the Federal Reserve to Raise All Margin rates to 100%

    Reinstate to Up Tick Rule for Short Sales.

    These two steps would cut out 95% of the abuses going on today.

     

     

  • It CAN NOT HAPPEN TO ME. GUESS WHAT? CHAP 19

    It CAN NOT HAPPEN TO ME. GUESS WHAT? CHAP 19

    IT CAN NOT HAPPEN TO ME. GUESS WHAT? IT WILL!!!

    Chapter 19

    HOW WE CAN BENEFIT FROM THE COMING PRECIOUS METALS SURGE

     

    Every cycle has a beginning and an end. It never fails.  In the beginning they pander the little investor to encourage them to come back.

    I will use the fine firm of Merrill Lynch as an example.

    Their name used to be Merrill Lynch Pierce Fenner and Bean. They were one of the top firms and they sought the “private Investor or PI” like Charles Schwab does today.

    Then in the late 1950’s or early 1960’s they changed THEIR NAME TO Merrill Lynch Pierce Fenner and Smith. The press loved it. I remember reading articles of praise that there are many more Smiths than Beans and that this was a smart public relations move to gather more PI business.

    Being in command and a trail blazer for the security industry they decided to go public and cash in on their good fortune. They shorten their name to just Merrill Lynch. This was a game changer. Now every employee had a chance to buy into their company and if they timed it right could sell and leave wealthy.  Long term employees suddenly found themselves very wealthy individuals. Long term horizons suddenly shifted to “How is our stock doing today?”

    Our Economy started with long term growth prospects under Presidents Truman and Eisenhower. The GI Bill and the interstate Highway systems were game changers. President Eisenhower has been disparaged for not lowering our taxes. The top bracket was 92%

    If one bought a stock and held onto it for six months then the “Government let you keep half the gain.”

    Lowering taxes has had the same effect as brokerage firms going public. Long term expectations started drifting downward to weeks , then days. With high frequency trades long term can be defined into “nano seconds”.

    We must make some adjustments to reward the serious investor

    They like many other firms started diversifying by catering to wealthy individuals and institutions at the same time. The PI investor was back on the bottom rung.   This was true for most of Wall Street.

    Certain banks have now become immense in power under the “too big to fail” mantra. JP Morgan and  the other commercials have been rigging the price of silver and gold on the commodity Comex exchange by the use of High Frequency Trades (HFT”S) derivatives and the use low interest rate Federal Reserve funds that were supposed to help financial institution liquefy.

    The price of an ounce of gold is over $1,600 US dollars as  of 8/29/2012 and an ounce of silver is $30.75. There is three times more gold than silver in world markets. Silver has a myriad of industrial uses while gold does not.

    So one of these days silver is going to be ungagged that  could cause an explosion on the upside while the shorts frantically try to buy back the silver they have sold. On the commodity side they have upper and lower limits and when those limits are reached they just close shop and go home until the next day.

    So how can us little guys make a bundle from all this?

    When there is a will there is a way. Never give up trying.

    Just get a pair of boots and blue jeans and a large sack or laundry bag and meander down to your town transfer station(trash dump)  and look for thrown away TV’s and computers and anything electronic. They all have to have a mother board that connects the chips to each other.

    There is silver in those connectors and chips. Rip them out and put them in you bag. When you have enough to carry go home. Now set up a system where you can burn in boards and are left with just silver. It will take a little practice to work out safely, so start small. You do not want to burn down your home.

    Now store the silver and wait. When the National TV News starts off with the price of silver; that is when you go to local pawn shops and start selling. Just a little in the beginning until you feel secure.

    So when grandiose wealthy individual takes you out of the game and starts selling and trading to the other heavy weights – just wait. There will come a day when they all want to sell.

    TO WHOM?

    In the end the big greedy guys end up the real bag holders – NOT US!!!