Firearms

The nice thing about being senile is You can hide your own Easter eggs. 

I’ve sure gotten old! I’ve had two bypass surgeries, a hip replacement, 
New knees, fought prostate cancer and diabetes. 
I’m half blind, 
Can’t hear anything quieter than a jet engine, 
Take 40 different medications that 
Make me dizzy, winded, and subject to blackouts. 
Have bouts with dementia .. 
Have poor circulation; 
Hardly feel my hands and feet anymore. 
Can’t remember if I’m 89 or 98. 
Have lost all my friends. But, thank God, 
I still have my driver’s license.

I feel like my body has gotten totally out of shape, 
So I got my doctor’s permission to 
Join a fitness club and start exercising. 
I decided to take an aerobics class for seniors. 
I bent, twisted, gyrated, jumped up and down, and perspired for an hour.. 
But, by the time I got my leotards on, The class was over. 

My memory’s not as sharp as it used to be. 
Also, my memory’s not as sharp as it used to be. 

Know how to prevent sagging? Just eat till the wrinkles fill out. 

It’s scary when you start making the same noises as your coffee maker. 

These days about half the stuff in my shopping cart says, 
“For fast relief” 

THE SENILITY PRAYER : 
Grant me the senility to forget the people I never liked anyway, 
The good fortune to run into the ones I do, 
and the eyesight to tell the difference.. 

Now, I think you’re supposed to share this with 5 or 6, maybe 10 others.. Oh heck, give it to a bunch of your friends if you can remember who they are! 

Always Remember This: 
You don’t stop laughing because you grow old, 

You grow old because you stop laughing!!!

Whatever the result of the congressional sausage making, it looks as if Build America Bonds are toast.

“BAB,” explains Lifetime Income Report’s Jim Nelson, “is a program that guarantees federal subsidies on certain taxable municipal bonds. So for each of these bonds sold to investors, the federal government pays 35% of the interest payments.”

“This eases the budget pains that states and local governments have been feeling since the economy hit the rocks in 2008. And it’s only going to get worse.”

News that BAB was left out of the Grand Bargain between President Obama and top Republicans in Congress “crushed the muni market this week, continuing a trend that started in early November.”

Don’t look for BAB to magically rematerialize in the final bill. “So bond funds and munis look like they hit a wall,” says Jim. That’s on top of Treasuries’ miserable performance we told you about earlier this week. All this reinforces the need for alternative sources of income like the ones Jim seeks out.

We just looked over a spreadsheet of the open positions in Lifetime Income Report. They’re up an average 25%. And the positions he’s sold during 2010 rose an average 23%. If that’s the kind of consistency you’d like for the income part of your portfolio, look here.

From Pennsylvania comes just about the worst idea we’ve seen in… well, maybe a week.

It’s a vending machine that sells you wine. Well, it sells you wine as long as you take a breathalyzer test, swipe your driver’s license and confirm your purchase with a bureaucrat on the other side of a closed-circuit TV camera.

This is Pennsylvania’s idea of “liberalizing” its liquor laws. For decades, the only place you could buy booze was a state-run liquor store. More recently, you could actually buy wine at a grocery store (which is more than we can do here in Maryland, but that’s another story)… as long as you contend with one of these contraptions.

Now comes word that Pennsylvania’s Liquor Control Board has approved these machines for use at Wal-Mart. So you can jump through all the hoops of your state-approved purchase while you listen to a pre-recorded message from Janet Napolitano urging you to narc on your fellow citizens if you see something “suspicious.”

It’s enough to drive you to drink, no?

“I read with dismay,” writes a reader, “about the double-dealing that went on with the Black Swan treasure. Sounds very similar to what Mel Fisher went through with the Atocha.

“If I were Odyssey, I would dump every last doubloon to the bottom of Davy Jones before I gave any of it to any government. I personally hope that they are considering that option.

“Better to get nothing than to allow the parasites in government to get their greedy hooks on any of it. But that’s me. Best of luck to them come what may, but don’t give in without a fight.”

The 5: The intrigue has caught on with the mainstream press, too. Here and here. We haven’t heard yet what Greg plans to do about it.

“Yes,” a reader writes, “go ahead and invite Julian Assange to speak in Vancouver, if he is still alive or hasn’t gone insane from torture, and if the nameless ‘they’ have not yet told Agora, as they have told an increasing number of other businesses, to shut up or close down.”

“With regard to the uproar over WikiLeaks,” writes another, “it is perhaps worth noting that in this government ‘of the people, by the people, for the people,’ the people have essentially no power to limit what the government may demand to know about their personal affairs, nor do they have any right to know the ‘personal’ affairs of government officials.

“On the other hand, as private citizens, we have been told that we must reveal to government officers all details of our financial affairs, even those parts that are held and accessed totally outside the legal jurisdiction of the United States.

“It is now deemed a crime to lie to any officer of the government, even when not under oath, but said officers are permitted to pile whopper on whopper in an effort to induce us to speak an untruth, yet they incur no penalty, even if they testify in court that they did so.

“And finally, it now appears that the charges of rape were grossly overstated, that instead a woman involved believes that she suffered ‘sex by surprise.’ But now that Mr. Assange is in the hand of the authorities, it seems exceedingly unlikely that he will be allowed to go free, even as the original charges which brought about his arrest fade into the background.

”In the face of all this, it is hard to defend the idea that the citizens control the government. Rather, government officials appear to view us as something between subjects and property, and they exercise the power to make it so.”

“You, my friend, are more correct than you know,” writes a reader addressing the New Zealander who unloaded on American “cretins” demanding Assange’s head.

“Every time this country gets in trouble, whether it be in world affairs or economically, the so-called leaders begin to manipulate (dare I say brainwash) people into believing their rhetoric. But the more insidious and covert action here is to create a ‘push button’ Pavlov’s dog response to anything they say.

“The government is carefully crafting a mechanism whereby they just have to spew key words to get these poor idiots to salivate; “patriot,” “freedom,” “terrorist,” “national security,” “our troops,” and the list just keep getting longer. Mind control is more powerful than anything to the people susceptible.

“We are becoming the ‘Cult of The United States of America.’ Too bad the Founding Fathers couldn’t foresee this destruction of democracy.

“So Mr. Assange, I wish you well, and I’m grateful for your courage to expose the real danger to our ‘freedom and Democracy,’ secrecy and manipulation.”

The 5: Without being too presumptuous, we believe the Founders did foresee the problems with democracy. That’s why they founded a republic. It’s our bad for turning it into a democracy.

“To the classless scumbag that makes $600,000 a year,” writes another, “and forced his wife to apply for food stamps: I say take the $600,000 and try and buy some integrity, you double-dipping f _ _ _er! It’s people like you that makes me ashamed to be an American.”

“You smart… but ruthless [expletive],” adds yet another. “You’re pulling in over a half-mil annually and you’re going to have your (I’m-not-committed-enough-of-a-man common-law) wife get food stamps. You, sir, are part of the problem and should be ashamed!

“Written by an out-of-work welder that turned down extended unemployment benefits so that I would not be part of the problem.”

The 5: Yikes… we always figured welding is one of those jobs for which there’d always be demand. Your comment makes us even more suspicious of the bureau’s unemployment numbers.

Regards,
Addison Wiggin
The 5 Min. Forecast

Thousands Learn to Defend Christian Faith, Understand Obama

CHARLOTTE, N.C. – Some 2,000 people from around the world convened at a Charlotte megachurch over the weekend to hear renowned apologists defend the Christian faith.

May be a bit jammed…apollogies for that…but read this about our wonderful Pres, et al.

A couple of generations ago, Japan attacked Pearl Harbor within months of a U.S. oil embargo. Monday, China embargoed exports of rare earth elements to the United States.

Rare earths, in case you need a refresher, are a class of 17 elements used in everything from mobile phones, to hybrid car batteries, to flat-screen TVs, to guided missile systems, to wind turbines.

If it involves cutting-edge modern technology, chances are it requires rare earths.

So what’s the rub? Right now, China controls 93-97% of the world supply, depending on the source you choose to cite at your next cocktail party.

Still, the Chinese decision to stop exports to the U.S. marks one of the strangest export bans in recent history.

When Russia banned grain exports in August, Prime Minister Vladimir Putin made the announcement himself and outed his fear that Russians would starve. But when China banned the export of rare earths to the United States, a New York Times reporter had to suss it out through “three rare earth industry officials, all of whom insisted on anonymity for fear of business retaliation by Chinese authorities.”

There’s no indication how long the embargo may last, and a fourth industry official says it appears a stray shipment or two is still being allowed to go through.

It puts officials in Washington in an odd position: “We’ve seen the news report,” says a spokeswoman for the Office of the U.S. Trade Representative, “and are seeking more information.”

On this front, they’re bereft of their usual posturing and indignant outrage. As if they just didn’t see this one coming… hmmmn….

When China cut off rare earth exports to Japan last month, the motive was pretty obvious: Japan captured a Chinese fishing boat in waters claimed by both countries. But what gives with the stealth embargo to the U.S.?

Of course, there’s headline-grabbing tension between policy wonks in Washington and party apparatchiks in Beijing over the value of the renminbi… which has, in turn, played host to a series minor trade disputes: The U.S. government has imposed duties on Chinese tires. Chinese officials have imposed duties on U.S. chicken. Yada, yada. Bureaucrats squabbling: what else do they fill their time with?

As we were looking under the hood, we found a motive with a little more oomph behind it.

Last Friday, the Office of the U.S. Trade Representative announced it was launching an investigation into Chinese subsidies of green energy. The United Steelworkers have been raising a ruckus about this so, of course, given the election cycle, there’s more than one beltway resident willing to go to bat for them.

The union claims the Chinese have adopted “policies that protect and unfairly support its domestic producers of wind and solar energy products, advanced batteries and energy-efficient vehicles… as China seeks to become the dominant global supplier of these products.”

What goes into wind turbines? Rare earths. What goes into advanced batteries and energy-efficient vehicles? Rare earths.

Suddenly, it all starts to make sense. Then again, the U.S. investigation may have simply handed Beijing a pretext for doing something it planned all along.

“China does have 97% of rare earths,” Jim Rogers explains, “and China’s booming. So China’s cutting back on the exports of rare earths, which I guess anybody would do if they were booming and they could see there was limited supply.”

“Since 2006,” explains The Economist, “China has behaved in a way that resembles OPEC, the oil-producers’ cartel, cutting exports by 5-10% a year. In July the export quota was cut by 40%. Prices have soared.” And they’ve soared at the very time demand is soaring, too: “Demand is forecast to increase by around two-thirds over the next five years.”

“If you could figure out a viable way to invest in rare earths,” Jim Rogers concludes, “you will probably make a fortune.”

So who are the winners and losers from all this? Reuters is out this morning with a handy list. The losers include the manufacturers who rely on rare earths. In the U. S., those are primarily makers of catalytic converters, along with the metal-alloying and ceramic-making sectors.

The winners are the miners of rare earths… and they do exist outside China’s closed system. In fact, 65% of world reserves lie outside China. They just haven’t been developed yet. The United States, Canada and Australia all have deposits that tiny mining firms are scrambling to bring into production.

But the most intriguing and explosive possibility of all — the most “viable way” to invest — lies elsewhere. It’s a combined rare earths-uranium play that falls clearly into Chris Mayer’s definition of a “special situation” — that is, the kind of thing that flies way underneath Wall Street’s radar. There’s an amazing story behind it, too… which Chris is eager to tell you about.

The global sell-off of everything except dollars that dominated the news yesterday is receding into memory today like a spontaneously tawdry happy hour. The dollar index is down more than half a percent to 77.8. Gold is recovering from its severe thrashing, however slowly — sitting smartly right now at $1,340.

Stocks, too, are up — the Dow recovering roughly one-third of yesterday’s losses. Those losses were already piling up for a host of reasons we spelled out in real time in yesterday’s issue… and then at 1:49 p.m. EDT, they went into hyperdrive.

At that exact moment, we learned who the “institutional investors” are who want redress from Bank of America for fobbing crappy mortgages on them. They’re heavyweights — Pimco, Blackrock and the New York Fed.

We also know how much they want in redress — $47 billion. That’s on top of existing “put-back” claims of $13 billion, which BoA says it will contest vigorously. We’d expect no less when BoA’s “loss reserves” total a scant $4.4 billion.

BoA shares are down 5% this week… and it’s only Wednesday.

Unlucky for BoA, but going forward the Federal Deposit Insurance Corp. says it expects fewer bank losses from here on. In fact, FDIC chief Sheila Bair says the outlook is so rosy she’s not going through with a plan to require banks to kick more into the FDIC fund used to “insure” your deposits.

By our over-the-shoulder accounting, the fund was $20.7 billion in the red as of June 30. But whatever; we take everything we hear from official channels as gospel. If nothing else, the announcement will help the banks goose their earnings statements three months hence.

The Great Recession may have officially ended more than a year ago, but banks are acting as if it’s still on, judging by their purchases of U.S. Treasuries. If anything, the trend is accelerating…

It’s still much safer to borrow from the Fed at next to nothing and pile into a 10-Year Treasury note at 2.5% than it is to lend to you — assuming you even wanted to borrow.

“Imagine the market,” asks Ray Blanco, who has joined Patrick Cox on the tech beat, “for a drug that’s 10,000 times more effective than today’s radiation or chemotherapy treatments for cancer… and many times safer for the patient, too.”

That’s the idea behind a cancer drug that amounts to the “smart bomb” of cancer — killing the cancerous cells, but leaving the healthy ones alone.

“What scientists do,” Ray explains, “is attach cancer-killing drugs to bio-engineered antibodies. The combo floats through your bloodstream and latches on to cancer cells… where it gets sucked inside, releasing its poison payload. And the cancer cell gets blown apart.

“The company that created this ‘smart bomb’ technology just tested it with a breast cancer drug. A third of the women using it saw their tumors shrink and half saw their tumors stop growing.”

This entirely new way to fight cancer is one of six breakthroughs Patrick Cox describes in a presentation we released a week ago today. 320,000 people have learned how these breakthroughs will build whole new fortunes over the next decade. If you’re not among them, but would like to be, here’s your chance.

“I looked at my last Social Security statement,” writes a reader, one of many determined to carry on beating the Social Security horse well after the vultures have picked its carcass clean. ”It says that between me and my employer, we have paid in a total of $277,934. I don’t know where that guy who paid in $79,000 and will receive $19,000 a year got his information.

“The $27,612 a year I can get from them if I start now, or the $37,632 I can get if I wait another four years, adding an additional $15,000 each year to that total, for a total of at least $60,000 more contributions, [which] by the way, doesn’t include the time value of the money I have paid in over the last 50 years. It will take me over 10 years simply to collect my original investment, without considering the forgone income I could have accumulated from that money.

“I ran the numbers some years ago, and discovered that had I simply put that kind of money into a savings account paying 5%, I’d have almost $2 million in cash. As far as I can see, you may have been better off putting the FICA taxes into a mattress, because at least your heirs would have that capital if you happen to keel over.

“The unpaid funds from Social Security are forfeit the day you die.”

“This discussion is dishonest from your readers on both sides,” another writes, offering another helpful perspective. “Yours was the honest appraisal — Ponzi scheme — but some of your readers seem to take that as a joke. This is hardly a laughing matter.

“Social security payments are a tax. The government even says so. Anyone involved in accounting or having a business must know that it is referred to as a payroll tax.

“Your money is taken from you without consent — taxed — and given to someone else as a bribe — welfare. It doesn’t matter whether you have been paying for two years or 200 years, whether your life was easy or tough. If you receive a Social Security check, you are a welfare recipient.

“You know, I’d love to get my money back, too. Not just my Social Security payroll tax money, but my income tax money, my cap gains tax money, my motor vehicle tax money, my property tax money. But you know what? It is not going to happen.

“I could add a huge dishonor to myself by being party to the theft of the next generation and accept welfare, but I won’t and neither should you. I read that when Isabel Patterson died, she had a stack of Social Security checks sitting uncashed in her desk drawer. She took a principled stand.

“Until we all take a principled stand, nothing is going to change for the better.”

The 5: At the risk of beating another horse to death, here’s one way to take a principled stand: The “Other” Government-Backed Retirement Program.

“For those who unfairly lump Social Security in with Bernie Madoff,” writes our final contributor, “in all fairness, you should point out the difference. No one was ever legally required to pay money to Madoff.”

Amen,
Addison Wiggin
The 5 Min. Forecast