Thousands protest in Spain’s capital over government austerity measures

MADRID — Several thousand anti-austerity protesters in Spain marched down a major street in the capital banging pots and pans Saturday.

Many protesters also blew whistles as they blocked part of the Castellana boulevard Saturday carrying placards saying “We don’t owe, we won’t pay.”

“None of us pushed the banks to lend huge sums of money to greedy property speculators, yet we are being asked to pay for other’s mistakes,” 34-year-old civil servant Maria Costa, who was banging an old pot along with her two children, said.

With unemployment nearing 25 percent, Spain has introduced biting austerity measures as well as financial and labor reforms in a desperate bid to lower its deficit and assuage investors’ misgivings.

Fed Launches QE3 (to infinity), Gold bugs and market watchers lose their S**T!

Fed ‘Currency Debasement 3′ (QE3) Sees Gold and Silver Surge 2% and 4.3%

“Bernanke’s announcement of further money printing and ultra loose monetary policies saw gold and silver surge in all currencies yesterday. Gold rose $34.30 or 1.98% in New York and closed at $1,732.00. Silver soared to a high of $34.781 and finished with a gain of 4.34%.

Ron Paul: “Country Should Panic Over Fed’s Decision”

“The consequence of what the Fed is doing is a lot more than just CPI. It has to do with malinvestment and people doing the wrong things at the wrong time. Believe me, there is plenty of that. The one thing that Bernanke has not achieved and it frustrates him, I can tell—is he gets no economic growth. He doesn’t do anything with the unemployment numbers. I think the country should have panicked over what the Fed is saying that we have lost control and the only thing we have left is massively creating new money out of thin air, which has not worked before, and is not going to work this time.”

Norcini – A Violent Wave Of Short Covering In Gold & Silver

“The stock market hit four and a half year highs, gold is knocking on the door of $1,800, and silver is pushing up toward $35.50.  There was a flood of hot money that had been on the sidelines which came roaring back into the market.  While hard assets were flying high, the US dollar continued to break down.

Felix Zulauf – Gold, Systemic Collapse & The End Of Fiat Money

 

Operation Screw: The Fed goes all-in on QE

The geniuses at the Federal Reserve have concocted a bold new plan to revive the U.S. economy — print a bunch of money, loan it to Americans at super low interest rates so they can speculate on rising real estate prices, extract the appreciated equity and spend it on consumer goods. In other words, build an economy of real estate, by real estate, and for real estate. The only problem is we’ve been there and done that. The last time it almost destroyed the U.S.economy. I guess almost isn’t quite good enough for the Fed, so now it’s determined to finish the job.

Gold Expert Jim Sinclair: “Coordinated Central Bank Stimulus Taking Place”

Source: JSmineset.com

My Dear Extended Family,

If you have eyes to see, coordinated central bank monetary and fiscal stimulation action is taking place.

Yesterday was “Draughi Day.” Today the Chinese officially released massive fiscal stimulus on top of the already monetary stimulus. Watch for the US Fed to chime in.

QE to infinity MOPEd as sterilized is falling into place. Please review my post from last weekend to you on the illusion of monetary sterilization.

Gold is going to and through $3500. The approach some long term gold bulls took toward gold, initiating a temporary short directly after Labor Day, is now in the process of backfiring badly.

Regards,
Jim

ECB Plan Said to Pledge Unlimited, Sterilized Bond-Buying

Source: Bloomberg

European Central Bank President Mario Draghi’s bond-buying proposal involves unlimited purchases of government debt that will be sterilized to assuage concerns about printing money, two central bank officials briefed on the plan said.

Under the blueprint, which may be called “Monetary Outright Transactions,” the ECB would refrain from setting a public cap on yields, according to the people, and a third official, who spoke on condition of anonymity. The plan will only focus on government bonds rather than a broader range of assets and will target short-dated maturities of up to about three years, two of the people said.

ECB President Mario Draghi told the European Parliament this week that the ECB needs to intervene in bond markets to wrest back control of interest rates in the fragmented euro-area economy and ensure the survival of the common currency. Photographer: Hannelore Foerster/Bloomberg

The euro jumped half a cent on the report to $1.2596 and European stocks advanced. An ECB spokesman referred to an Aug. 20 statement in which the Frankfurt-based central bank said it was misleading to report on decisions that haven’t been taken yet.

Draghi told the European Parliament this week that the ECB needs to intervene in bond markets to wrest back control of interest rates in the fragmented euro-area economy and ensure the survival of the common currency. Policy makers will start deliberating on the plan later today and Draghi will announce whether it has been agreed to at a press conference tomorrow.

Bundesbank Opposition

The officials said policy makers are likely to adopt the proposal, with Germany’s Bundesbank remaining the sole objector. At the same time, one said Draghi’s relationship with Bundesbank President Jens Weidmann remains relaxed, and the two men only disagree on whether risks inherent in the bond plan are likely to materialize.

To sterilize the bond purchases, the ECB will remove from the system elsewhere the same amount of money it spends, ensuring the program has a neutral impact on the money supply.

At the moment, the ECB mops up the impact of its mothballed bond-purchase program by offering banks weekly term deposits that currently return 0.01 percent.

With the central bank’s deposit rate at zero and the euro- area banking system currently awash in about 800 billion euros ($1 trillion) of excess liquidity, a larger bond program may not present the ECB with a major obstacle.

No Seniority

While the ECB doesn’t expect to have to spend large sums of money on bonds, Draghi’s plan calls for no limits to be set, two of the officials said. The ECB also won’t have seniority on any bonds it buys, they said. No yield-spread targets or bands will be set publicly, they said. Two said targets won’t be set internally either and that interventions will be discretionary.

Draghi will stress conditionality of the program tomorrow, with the ECB likely to stop buying the bonds of any government that fails to meet the conditions it agrees to when it signs up for aid from Europe’s rescue fund — a precondition for ECB action — two of the people said. Another proposal is for the ECB to sell the bonds it has bought if a country doesn’t comply with the conditions, two of the officials said.

To contact the reporters on this story: Jana Randow in Frankfurt at jrandow@bloomberg.net; Jeff Black in Frankfurt at jblack25@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net