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Jim Cook



Every once in a while I switch the TV channel from Fox to CNBC to see what the liberals are saying.  After listening awhile I get a deep sense of hopelessness and foreboding for our country.  The most important thing for the left is giving money to people.  They are happy to see the growth of food stamps, disability payments, housing subsidies, free healthcare and all the other welfare benefits.  They utterly fail to see the damage it is doing to the recipients.  Whole cities that once flourished have deteriorated into rotting eyesores populated with shambling hulks of chemically dependent drones.  These people are no longer employable.  They have become incompetent and helpless and the liberals can’t see that it’s their doing.

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The Best of Jim Cook Archive

Best of Bill Buckler
June 16, 2009
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Thursday and Friday - June 4 and 5 - were tumultuous days in the huge US bond market. The yields on Treasury paper of two years or longer soared skyward. They got routed. Losses for holders of this Treasury paper were estimated to be in the 20-30 percent range over just those short days.

There Is No Safe Place On The US Yield Curve:

At the short end of the Treasury curve, the Fed still exercises some control but nobody knows for how much longer. With longer term (two-years or more) paper, the situation is dire. Prices for 10 and 30-year Treasury paper (which move inversely to yields) are down 8.58 percent and 24 percent respectively for the year to date. For months, buyers of US Treasury debt have been going to the short end, the Chinese in particular, while shying away from longer-term paper. But even here, the recent falls of the US Dollar are making Treasury paper anything but "safe".

The Burning Fuse To The US Debt Bomb:

In the week ended as this issue of The Privateer goes to press, the Treasury rolled an additional $US 131 Billion in brand new debt paper down the street. With yields right across maturities having risen the previous week – with commensurate price losses - the point is getting close where the lit fuse on the debt bomb will reach the ignition point.

The signal for the US debt bomb going off will be a Treasury auction where there is an insufficient amount of willing buyers - which means part of the issue is left unsold with some Treasury paper left on the counter. At that point, the only remaining buyer will be the Fed. To "buy", the Fed will have to create HUGE amounts of US Dollars out of thin air…..

If the Fed DOES become the buyer of last resort, the US Dollar will move into the global spotlight. The world will have positive proof that the US intends to literally inflate itself out of its current problems. Foreign central banks right down to any private investor in US Treasury and all other US paper will be staring at enormous losses as the US Dollar falls in value. For Americans, a massive fall in the US Dollar will promptly show up as climbing import prices, followed in short order by climbing internal prices and then US interest rates will really join the party and soar upwards to compensate lenders for the risk.

Statistics For Monday, June 8 - Courtesy Of The USA Today Show:

If you are an American, your family's share of government debt is now over half a million Dollars. A record $US 546,668, to be exact. Nothing shows more clearly the serfdom of Americans today. Others, the ones in federal, state or local governments, have borrowed the money. It is, of course long gone.

Only the debts remain. Those who borrowed and spent the money will not have to repay it. That will be the task of the American serf, his family and his children.

On top of this debt is what the American serf personally owes on mortgages, credit cards etc.. These personal debts can be added to what the serf owes government. This is the economic "foundation" upon which the US has to attempt a restart. Without a MASSIVE spending cut in Washington DC - NO WAY.

Ó 2009 – The Privateer

(reproduced with permission)


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