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In recent years there have been methods developed to decentralize investing. We take a close look at crowdfunding, the legal issues and dangers involved, and how to approach it as an entrepreneur. Crowdfunding is an important step forward in supporting both small and large efforts for the individual and groups alike.
This Solari Special Report includes legal pathways to help navigate these new developments.
As we look over the fiscal cliff into our financial abyss, now is a good time to “Come Clean” about the real state of our lives, our communities, and our economy, starting with the U.S. federal finances that flow deeply and intimately throughout every aspect of our lives.
This Solari Special Report includes (22) challenges we must address to put our federal fiscal house in order.
One-Third of Americans are Delinquent on Their Debt
Yahoo! Finance | 29 July 2014
If you’ve been on the receiving end of an unsolicited phone call from a debt collector, you’re far from alone…
Spanish Bond Yields Tumble Below 2.5% – Lowest In History
Bloomberg | 28 July 2014
European peripheral bond yields have compressed from “whatever it takes” highs to “whatever…” lows…
Angola Delays Stock Market to 2017 to Fix Company Accounting
Bloomberg | 25 July 2014
Angola, sub-Saharan Africa’s third-largest economy, won’t start equities trading until at least 2017 because companies need to improve their accounting records…
Respecting the Message of Bob Farrell’s Rule #7
Financial Sense | 25 July 2014
There are many successful investors who have accumulated decades of experience and have drilled down their pearls of wisdom to insightful lists…
Report Shows 1 in 3 Texans Chooses Renewable Energy Options
Tyler Morning Telegraph | 27 July 2014
A Texas Empowerment report released by Choose Energy shows that about one in three Texans choose renewably sourced energy options…
Never Too Old for E-Commerce, Chinese Company Says
The New York Times | 28 July 2014
A spokeswoman for Alibaba, the Chinese company that operates the popular Taobao e-commerce site…
Deutsche Bank, HSBC Accused of Silver Fix Manipulation
Bloomberg | 25 June 2014
Deutsche Bank AG (DBK), HSBC Holdings Plc (HSBA) and Bank of Nova Scotia were accused in a lawsuit of rigging the price of billions of dollars in silver…
Court Forces Government to Release Documents in Fannie/Freddie Suit
National Legal Policy Center | 25 July 2014
The burden carried by the holders of stock in mortgage giants Fannie Mae and Freddie Mac…
British Tanks Join Poland Exercises to Reassure Allies Against Putin
Telegraph | 28 July 2014
An armoured British battle group of 1350 troops and 350 vehicles will join Nato military exercises in Poland to reassure Eastern alliance members…
Satellite Study Reveals Parched U.S. West Using Up Underground Water
NASA | 24 July 2014
A new study by NASA and University of California, Irvine, scientists finds more than 75 percent of the water loss…
China Expands Live-Fire Gulf Of Tonkin Drill; Warns Of Massive Flight Disruptions
Zero Hedge | 27 July 2014
In a surprise announcement, China revealed that in addition to scheduled naval drills to be held near Vietnam…
The Corruption of Gov. Andrew Cuomo
The Komisar Scoop
Anyone who had read the two-part series published here…
100,000 amps breakthrough: Highest Electrical Current Achieved in Japan
RT | 27 July 2014
Japanese scientists have managed to achieve an electrical current of 100,000 amperes…
Some Antibiotics With Your ?heeseburger? Russia Regulator Probes McDonald’s
RT | 28 July 2014
Russia’s consumer watchdog Rosselkhoznadzor has opened an investigation into the quality of food products…
Cash Crops With Dividends: Financiers Transforming Strawberries Into Securities
Dealbook | 21 July 2014
His boots were caked with mud when Thomas S. T. Gimbel…
U.S. Poised to Label MetLife a Potential Threat to the Financial System
Bloomberg | 22 July 2014
A U.S. council of regulators is poised to label MetLife Inc…
NY Fed Slams Deutsche Bank (And Its €55 Trillion In Derivatives): Accuses It Of “Significant Operational Risk”
Zero Hedge | 22 July 2014
First it was French BNP that was punished with a $9 billion legal fee…
Inflation or Deflation
This prices listed for each product are the prices in my area…
WHITE HOUSE PETITION: President Obama, Please Reverse USDA Coup Undermining Organics
The Cornucopia Institute | 16 July 2014
When Congress passed the Organic Foods Production Act of 1990 (OFPA)…
Ukraine Coalition Government Collapses as 2 Parties Quit
Bloomberg | 24 July 2014
Ukraine’s coalition collapsed after two parties quit during a months-long pro-Russian insurgency…
Beretta Leaves Maryland Over Gun Laws, Heads for Tennessee
Washington Times | 22 July 2014
Citing Maryland’s recently enacted firearm laws and the prospect of more restrictions…
Clinton Earns $12 Million Speaking, Writing After Service
Bloomberg | 21 July 2014
Hillary Clinton has earned at least $12 million in 16 months since leaving the State Department…
Russia Says Has Photos Of Ukraine Deploying BUK Missiles In East, Radar Proof Of Warplanes In MH17 Vicinity
Zero Hedge | 21 July 2014
Ukraine hasn’t said how it immediately knew rebels downed Malaysian plane…
California Halts Injection of Fracking Waste, Warning it May Be Contaminating Aquifers
Propublica | 18 July 2014
State’s drought has forced farmers to rely on groundwater, even as California aquifers have been intentionally polluted due to exemptions for oil industry…
Ryden Dual Carbon Battery
Revolution Green | 21 July 2014
This is a good story I am visiting for a second time. It represents many new battery technologies that are emerging and could have a huge impact on transport. This is one of the more serious attempts…
Citigroup Settles Mortgage Inquiry for $7 Billion
The New York Times | 14 July 2014
The $7 billion deal that Citigroup agreed to strike with the Justice Department…
Executive Pay ’180 Times Average’, Report Finds
BBC News | 13 July 2014
Executive pay has grown from 60 times that of the average worker to almost 180 times since the 1990s, according to a report…
Step Inside CYNK, The Company That’s Worth $5 Billion But Has No Revenues, Assets, Or Full-Time Employees
Yahoo! Finance | 12 July 2014
Yesterday we wrote about the strange case of CYNK Technology…
Survey: Growth Forecast Lowered to 3 Percent for the Second Quarter
The Hill | 11 July 2014
Business economists have lowered their estimates for economic growth in the second quarter following news…
Got ’em, Gotham
The Economist | 12 July 2014
The company-accounts detectives collar another suspect…
Traders Flood U.S. With $3.4 Trillion of Bond-Auction Demand
Bloomberg | 14 July 2014
The intensifying debate over when the Federal Reserve raises interest rates is little more than a sideshow when it comes to the ability of the U.S. to borrow…
Tory Child Abuse Whistleblower: ‘I Supplied Underage Rent Boys for Margaret Thatcher’s Cabinet Ministers’
Mirror | 13 July 2014
Whistleblower and former Conservative party activist Anthony Gilberthorpe says he provided child prostitutes for a sex and drugs party with top politicians…
Women Bishops Approved By Church Of England… Finally
The Huffington Post | 14 July 2014
The General Synod of the Church of England voted today that women can be consecrated as bishops…
Little Oversight as Nestle Taps Morongo Reservation Water
The Desert Sun | 14 July 2014
Among the windmills and creosote bushes of San Gorgonio Pass…
World Bank and UN Carbon Offset Scheme ‘Complicit’ in Genocidal Land Grabs – NGOs
The Guardian | 03 July 2014
Plight of Kenya’s indigenous Sengwer shows carbon offsets are empowering corporate recolonisation of the South…
Germany Orders CIA Station Chief to Leave Over Spying Allegations
The Washington Post | 10 July 2014
The German government ordered the CIA’s top officer in Berlin to leave the country…
“Judge things by how statistically likely they are, not how they appear.” ~James Montier
By Catherine Austin Fitts
This week, I will be speaking with Chuck Gibson – managing member of Financial Perspectives and my partner at Sea Lane Advisory, LLC.
First, we will review events and performance in the global equity markets for the second quarter. The strength of the equity markets into July has continued to surprise investors, even inspiring Fed Chairman Yellen to describe valuations in some market sectors as “substantially stretched.”
Then, Chuck has a technical analysis on “finding bottoms.” While US equities have been strong, other parts of the equity markets have been weaker and commodities have been in a consolidation pattern. Buying equities at market highs has historically not been a strategy for attractive long term gains. When investors fine themselves facing all time highs in one market, how do you identify when it is time to take advantage of markets that have been consolidating or are low? How do you identify a so-called market bottom? How do you know when to shift?
Chuck has prepared a presentation using precious metals as an his example. A discussion of relative values in the two markets will be good background for our discussion with Franklin Sanders on the Precious Metals Market Report in August – August and early September are a traditionally low season for gold.
In Let’s Go to the Movies, I will review George Clooney’s latest movie The Monuments Men and what it tells us about the spoils of war. Stories of war time looting, seizures and the various economic spoils of war are on our minds these days as a new round of economic sanctions trigger asset transfers and resulting winners and losers.
Talk to you Thursday!
“What is relevant is what solves the problem. If we had thought through real relevancies, we would be on Sirius by now.” ~Sir Peter Medawar
By Catherine Austin Fitts
The news informs us this morning that Angola has delayed the launch of their stock market until 2017 so that the companies in Angola have more time to get their accounting in order. This is a reminder that the world is still building out its equity market infrastructure and we have a long way to go in doing so.
I remember in the early 1990′s when the SEC set up an emerging markets task force and asked me to participate. Teams from the SEC were traveling around the world to help people set up their stock markets. In 1997, I was in Shanghai as the new Shanghai exchange was getting off the ground. To say it was basic is an understatement. Yet, the interest and learning speeds were astonishing. So it is not surprising where Shanghai is today and where it is expected to be in decades to come.
One of the challenges that the emerging and frontier markets face is building the intellectual capital necessary to maintain public equity markets – this includes a trustworthy accounting profession.
One of the strengths of the Anglo-American world has been our investment in the legal and financial tools that make markets go – including accounting. However, increasingly the question is not whether the developed world’s accounting is more trustworthy – but whether it is just better at keeping rigged accounts rigged and floating along.
I worked closely with three of the world’s top accounting firms when I ran the Federal Housing Administration and then ran the company that served as their lead financial advisor. I don’t believe a word that comes out of the mouth of two of them – now merged. Their signature on a piece of paper is entirely worthless, other than testifying that any lies involved carry official weight. The third was Arthur Anderson and we know what happened there.
What gives me comfort when I review the financial statements of companies is not the auditor name – it is the quality of the board of directors, the management and the lead investors. Nothing supports the successful management of a company like the integrity of financial communication and reporting. So in businesses that operate in the general economy, there are strong incentives for keeping things accurate. Timely feedback is a force multiplier that keeps success grounded in the marketplace serving real customers.
Businesses that derive the majority of their revenues from serving the federal government as contractors are another matter. The National Security Council can give waivers that allow companies to report accounts and financial statements that are not in compliance with SEC rules.
The US government has refused for 20 years to comply with the laws requiring audited financial statements. The official reality of the US governments operations and finances has become so different than the reality that it is impossible for the US government to comply with the law or pass an audit. And even if it did, the accounting profession’s audit statement is not to be trusted.
For an audit to have meaning the auditor has to have the ability to say “no” without having his or her life threatened, or for that matter, the lives of their family and children.
I appreciate the challenge that Angola is facing. Prosperity depends on financial liquidity, which depends on integrity in accounting. From the time that the Franciscan friar Luca Pacioli blessed us with double-entry bookkeeping, achieving that integrity has been an inter-generational journey that is far from over.
When you look at the financial statements for a company or organization, first look at the pictures and resumes of the people who govern, manage and own or fund it and ask yourselves, “Do I believe these people to have integrity and be competent at what they are doing?” If the answer is “no,” don’t bother to read the financial statements. As a practical matter, they are probably meaningless.
By William Alden
Regulators on Wednesday imposed new restrictions on a vast market that played a significant role in the 2008 financial crisis.
The Securities and Exchange Commission voted 3 to 2 to adopt a set of new rules for money market funds, a $2.6 trillion industry where ordinary individuals and sophisticated institutions alike park their money. The rules come after years of debate among regulators and lobbying from Wall Street.
By Catherine Austin Fitts
This week on The Solari Report, more on “breaking away” as I present my 2nd Quarter Wrap Up.
The first half of 2014 has been profoundly power shifting. I will review the most important events in the financial markets and geopolitical stories that highlight the primary trends impacting your time and finances. My goal is to help you see the strategic areas of investment opportunity and risk as they unfold within the events around us.
In Let’s Go to the Movies, I will review the Belgian police thriller Salamander. Salamander has been been purchased by the BBC and is scheduled for an English-speaking remake. A fascinating case study in the nature of political governance and control in the 21st century, Salamander underscores the power and importance of “control files.” For those of you trying to understand the latest round of pedophilia scandals in England and how compromising pictures in the wrong hands can drive people to extremes, this one is for you.
Please make sure to post or e-mail your questions and comments. “Talk” to you Thursday!
By Catherine Austin Fitts
Here is the bottom line from our “2nd Quarter 2014 Wrap-Up”.
Slower US and global growth in the first half of 2014 means the slow burn is fraying. This means that the reduction of liquidity that results from Fed’s continued taper through the end of October is going to increase financial risk and geopolitical tensions. As the Fed Chairman and IMF heads have pointed out, their authority and tools can not address the growth or challenges in the shadow banking system.
I said at the beginning of the year that our big risk if the slow burn wears thin is not global financial collapse, but war – in all its varied forms.
From the genocide in Gaza to the fighting and economic collapse in the Ukraine, from the drought in parts of North America to the disappearance and crashing of commercial planes around the world, from enforcement actions against European banks to enormous tensions facing mid-term election campaigns, the managers of the global economy are scrambling to keep the slow burn going.
With the Fed taper ending in October, G-7 risks the WWI equivalent of landing on Normandy Beach with water pistols. That is, unless they call in the military.
Of course, all the fighting only shrinks the global pie, just as continual centralization has been shrinking it for a long long time. Control of the global currency and investment model – this is the end game.
Say a prayer for world peace and for peaceful hearts and minds for global leadership.
“The Post World War II System of Hidden Finance” with Dr. Joseph Farrell
The National Security Finance Intelligence Military Industrial Complex
“Guns & Butter” investigates the relationships among capitalism, militarism and politics. Maintaining a radical perspective in the aftermath of the September 11th attacks, “Guns & Butter: The Economics of Politics” reports on who wins and who loses when the economic resources of civil society are diverted toward global corporatization, war, and the furtherance of a national security state.
Nothing on The Solari Report should be taken as individual investment advice. Anyone seeking investment advice for his or her personal financial situation is advised to seek out a qualified advisor or advisors and provide as much information as possible to the advisor in order that such advisor can take into account all relevant circumstances, objectives, and risks before rendering an opinion as to the appropriate investment strategy.
© Solari 2012