BLS Employment Chart

Considering a move to another state or across the country?  Be sure to count the cost of that move by checking the employment numbers that can tell you the economic health of the city.  Open up this Bureau of Labor Statistics link and check out the interactive charts that can give you an overview of the city that you're planning on christening as your new home.

Also, if you're concerned about the financial health of a particular city across the country and whether it is solvent or not, this chart gives you a guide.

G. Edward Griffin on J.P. Morgan's Corner on Gold Derivatives

It’s official: JP Morgan has cornered the gold-derivatives market in the US.

To corner a market means to control a sufficient percentage of the total to be the biggest player in the field and, thereby, be able to determine prices and policies. JPM owns 60% of US gold derivatives valued at $65.4 billion.

However, those contracts are backed by only $1 billion in physical gold. That means the bank would be wiped out if gold speculators decide they want real gold instead of paper contracts for gold. If or when that happens, the physical-gold market will skyrocket, and governments likely will come to the aid of the banks by halting trading “to protect the world economy” of course. What would happen then is anyone’s guess. These are interesting times.

http://www.zerohedge.com/news/2014-02-01/market-cornered-jpmorgan-owns-over-60-notional-all-gold-derivatives

Compound Interest

The incentive for banks to offer compound interest is exchange for large amounts of deposits. 

According to this article, Citi Bank offers compound interest on two different types of accounts. "They offer two different kinds of compound interest savings accounts. The first kind of savings account they offer is a Preferred Account. This account requires a minimum daily balance of $25,000. With this account, one percent interest is compounded daily. The second account that they offer is a Starter Account. This account only requires a $100 daily balance. If you have this account, they compound interest monthly at 0.90 percent."

Credit card companies, mortgage banks, and others charge you compound interest.  So as certain institutions charge you compound interest, why not try and earn compound interest for yourself?

Metal Content of US Coins Gets Expensive

Robert Wenzel of Economic Policy Journal reviews WSJ article on mintage . . .

Price Inflation Will Force the US Mint to Once Again Change the Metal Content of Coins

Price inflation indexes may not indicate much 
inflation, but the US Mint knows that the indexes 
don't reflect the true picture .

The  Mint is considering a change to the mix of
metals it uses to make quarters, dimes and 
nickels, because of the climbing cost of 
production of the coins. reports WSJ.

It now costs 1.8 cents to make a penny and 
9.4 cents to make a nickel, costing the 
federal government about $104.5 million 
last year.

If the materials are altered for the first time 
in half a century or more, some coins could 
have new colors and weigh less, says WSJ.
It plans to keep the diameter and thickness 
of any potential new coins the same as 
existing specie.

Richard Peterson, the top official at the Mint,
said completely stopping production of the 
penny is a "discussion topic."

"[D]imes and quarters, they are really the 
workhorses of the coin lineup right now," 
Peterson said.

I fully expect that in the next bout of 
accelerating price inflation that the value 
of the metal content of current nickels will 
soar. Thus, nickels are a great no downside 
investment. If the price inflation I anticipate 
doesn't develop, just spend the nickels. For 
more on nickels as an investment see:
Why You Need to Own Nickels, Right Now

Chinese Shadow Banks on Verge of Default?

from Bob Wenzel . . . 

SUNDAY, JANUARY 19, 2014

Breaking: Chinese Financial Firm Warns Shadow Bank May Not Repay Its Debt

Reuters reports:
"The trust firm responsible for a troubled high-yield investment 
product sold through China's largest banks has warned investors 
they may not be repaid when the 3 billion-yuan ($496 million)
product matures on Jan. 31, state media reported on Friday.

Investors are closely watching the case to see if it will shatter 
assumptions that the government and state-owned banks will 
always protect investors from losses on risky off-balance-sheet 
investment products sold through a murky shadow banking system.

Based on a loan to an unlisted coal company, the now distressed 
product was created by China Credit Trust Co Ltd, while Industrial 
and Commercial Bank of China , the world's largest bank by assets, 
helped to market it to wealthy investors in central Shanxi province.

On Friday, the official China Securities Journal reported that the 
trust company is considering legal action to press related parties 
for repayment to protect investors' interests.

The newspaper went on to quote trust industry sources saying an 
outright default was likely to be avoided simply by delaying 
repayment until arrangements were made to repay investors by 
other means."

I have been reporting at the EPJ Daily Alert that China is on the
verge of a huge collapse. Indeed, in recent weeks I have been
advising that Chinese financial sector ETFs be shorted.

China may be able to bail out one deal, but the problem is developing
nationwide across the capital goods sector, and a nationwide bailout
would mean massive inflation. Eventually, China is going to have to
either allow a massive crash or print incredible amounts of money
that risks major unrest from the general public who will have to deal
with the price inflation consequences.

Kotlikoff: We're Broke Now

The Treasury-Federal Reserve Naked Tango

Professor  Lawrence Kotlikoff  explains:

[W]hile Bernanke says [his money printing] is all to keep down interest rates, there is a darker subtext here. When the Treasury prints bonds and sells them to the public for cash and the Fed prints cash and uses it to buy the newly printed bonds back from the public, the Treasury ends up with the extra cash, the public ends up with the same cash it had initially, and the Fed ends up with the new bonds.

Yes, the Treasury pays interest and principal to the Fed on the bonds, but the Fed hands that interest and principal back to the Treasury as profits earned by a government corporation, namely the Fed. So, the outcome of this shell game is no different from having the Treasury simply print money and spend it as it likes.

The fact that the Fed and Treasury dance this financial pas de deux shows how much they want to keep the public in the dark about what they are doing. And what they are doing, these days, is printing, out of thin air, 29 cents of every $1 being spent by the federal government.

Here are a few links that Kotlikoff mentioned in his interview:
1.  TheInformAct.org
2.  ThePurpleHealthPlan.org
3.  Kotlikoff.net
4.  MaximizeMySocialSecurity.com

How Money Walks

Howmoneywalks.com