Embry of Sprott Asset Management - Comex Defaults Dec2008? Greenspan admits defeat of free-markets and low interests, Mixed earnings continues...

I believe Gold and Silver will remain the alternative to fiat money. Keep in mind that it generally takes 12 months for the surge of credits and funds in the economy to really hit the nerve and cause inflationary numbers. Cartoon to the left was aptly named "Greenspanism".

Base metals from zinc to copper will (and has) already seen battered futures prices, with copper at a 3-year low yesterday. Embry reflects similar views to this in the interview below

_______________

John Embry - widely followed economist at one of Canada's leading mutual funds, believe there might be a case of physical calls for gold and silver come December 2008's expiry date. What does everyone think?

http://watch.bnn.ca/tuesday/#clip104603

The premium of physical precious metal has risen so much in the last 2 weeks for Canadian (especially factored in US$ rise) that even the usual mass-panic-averse Sprott professionals are telling themselves this doesn't make any sense.

The International Monetary Fund (IMF) announced that Pakistan, Hungary, and Ukraine are amongst countries looking for financial support AKA Emergency Econ Stabilization Plan of 2008 AKA. Bailout AKA Rescue Plan, what. Smaller countries like Iceland have alreday nationalized its banks and have seen 77%/day drops in its stock market and 2,000% drop in its currency against the Euro.

The government has insisted that seeking IMF help to avoid a balance of payments crisis is only a "back-up plan", but officials said privately that they would likely seek the $4 billion the country needs. Dwindling foreign currency reserves can cover the nuclear-armed Islamic republic's import bill for only six more weeks, and Pakistan's new civilian administration admits rapid action is required. Pakistan's finances have "deteriorated significantly" according to an IMF report released on Monday, due to recent political instability, Islamic militant violence, and high oil and food prices. Its foreign reserves have sunk from $14.3 billion in June 2007 to $4.7 billion in September 2008, while the rupee has lost 25 percent of its value this year and the stock market has dropped 35 percent, it said. The Financial Times reported on Tuesday that Pakistan was in "informal discussions" with the IMF and other bodies over a $10 to $15 billion international support package designed to stabilise its economy.

On the brighter side, at least they only need as much as California was looking for to keep its doors open through October! At least they "seemed" to have found the $7 billion elsewhere, maybe it was from Mr. Allan Greenspan's accounts at the Federal Reserve Boards?

SACRAMENTO — A week after warning the Treasury Department that California might need an emergency loan of up to $7 billion, Gov. Arnold Schwarzenegger on Thursday sent another, more upbeat note expressing a “cautiously optimistic” belief that the state could find the money it needed in the credit markets. In a letter to Treasury Secretary Henry M. Paulson Jr., Mr. Schwarzenegger, who presides over the country’s most populous state and one of the world’s biggest economies, struck a far less urgent tone as California prepared to give Wall Street another try.

Thanks to the low interest rate over the 2002-2006 era, Mr. Greenspan has been criticized lately for funding the bubble growth of US during the current market crisis and unveiling of the real evils of the free-market economy. Greed.

http://www.pbs.org/newshour/updates/business/july-dec08/greenspan_10-23.html

Greenspan Calls Financial Crisis a 'Credit Tsunami'
In testimony before Congress Thursday, former Federal Reserve Chair Alan Greenspan said that the current financial crisis is a "once in a century credit tsunami" that will continue to impact the U.S. economy, spurring more job losses to come.

Given the financial damage to date, I cannot see how we can avoid a significant rise in layoffs and unemployment," Greenspan said in prepared testimony.

Greenspan, who headed the nation's central bank for 18 1/2 years, planned to tell lawmakers that he and others who believed lending institutions would do a good job of protecting shareholders are in a "state of shocked disbelief," according to the Associated Press.

Jim Willie has the following to say on Contrary Investor Cafe. Things will get really bad before it gets better. Sobering presentation to say the least, but it is a good listen. Unlike most newsletter writer this gentlemen has the experience and education background (PhD in Stats) to back up some of his technical claims.

http://www.contraryinvestorscafe.com/broadcast.php?media=143