Sunday, September 9, 2012

Mixing Oil and Water w/Lindsay Hall and Stephen Leeb!

Welcome to Capital Account. The jobs report released today reiterates a grim situation for millions of unemployed Americans. The jobs number was below expectations again: the economy added 96,000 jobs while analysts expected 130,000. The unemployment rate fell from 8.3% to 8.1%, however this drop is most likely due to a fall in the labor force participation rate. Meanwhile stock markets appear more than eager to grasp the hand of dovish central banks. Stocks rallied after the ECB announced its unlimited bond buying program yesterday. We talk about it. Also, China has reportedly approved plans for $158 billion in infrastructure spending. China's growth is slowing and analysts are concerned about slumping iron ore prices, a gauge of industrial production. We talk to commodities expert Steven Leeb, Chairman and Chief Investment Officer of Leeb Capital Management, about what effect this stimulus might have. We also discuss the effect that marginal cost increases have on commodities more broadly, and the important role that water scarcity plays in all of this. Plus, at the DNC Barack Obama spoke about a path where the US reduces its dependence on foreign oil and takes more control of its own energy future. Administration officials met with oil market experts yesterday as they consider the release of Strategic Petroleum Reserves. We talk to Lindsay Hall, Chief Market Strategist for the RMB Group (, about why she still anticipates higher prices for oil despite economic slowdowns in China and Europe and SPR injections. We also ask her about the Japanese Yen, and what she thinks, as a FOREX trader, about where the currency is headed in the near future.

Regaining your Economic and Financial Independence w/Kung Fu Finance Girl!

Welcome to Capital Account. Today, European Central Bank President Mario Draghi announced a bond-purchase program in the euro zone with no set limit. But why should you, who may be thinking about your future and your retirement, care about Super Mario's latest policy response? Our guest Susan Fujii editor-in-chief of Kung Fu Finance and an SEC accredited investor says you can't afford to ignore the macroeconomic landscape if you are trying to protect yourself in this new economic environment. She joins us to explain why. Plus, Senate Candidate Elizabeth Warren had some tough words for Wall Street CEOs in her DNC speech last night, saying that despite wrecking the economy Wall Street Bankers "still strut around Congress," demanding favors from lawmakers. But is it a little naive to think that the candidate you elect president or into any office for that matter will really change this situation? We think this is a bit naïve to say the least., and this is one example of the problem with political rhetoric when it comes to finance and the economy. If you believe the rhetoric and think everything will be fine, or believe that you can trust political institutions to take care of you, you may not do so well. Susan Fujii, investor and editor-in-chief of Kung Fu Finance makes the case for financial independence versus financial dependence to the government or your employer. To give you just one example of why this should be on your mind...the United States Treasury Department this week announced the US national debt has surpassed $16 trillion. But how exactly are we supposed to wrap our heads around this? Millions, billions, and even trillions are bandied about as though they were pocket change, but can we really conceptualize what those numbers amount to? And the questions are unanswered as to what happens when interest rates rise and the government has to pay more toward interest and less towards other things? What happens if the globe loses faith in the currency? It's these kinds of questions many of our viewers ponder quite regularly, especially when it comes to figuring out what kind of safety net exists for them during these very unstable economic times. And so, our guest has made it her mission to help individual investors figure out how to build their own safety net and save themselves. Susan Fujii, editor-in-chief at Kung Fu Finance, tells us how. The immediate actions she believes individuals can take include investing in physical gold, keeping some cash on hand (something to use to buy assets if they go on sale!), and using trailing stops to avoid any major losses on your investments.

GATA's Bill Murphy on the JP Morgan Silver Shortage and the next Bullion Bank Run!

Welcome to Capital Account. Gold futures slipped ahead of the ECB policy-setting meeting this week, or so the story goes. Do these macro trends drive gold prices as much as the headlines indicate? Our guest Bill Murphy, Chairman of GATA, doesn't think so and he has flown to our studio in Washington DC to make the case. Last month after a report surfaced that US regulators planned to drop the silver market manipulation probe, CFTC Commissioner Bart Chilton described the report as premature and inaccurate. We haven't heard much since, but our guest Bill Murphy has an update on the bank at the center of silver manipulation claims, JP Morgan. JP Morgan has a major problem with their massive short position according to GATA. Bill believes that it won't be long before their role in the market manipulation scheme is exposed. Meanwhile, the silver market maybe the tightest it has ever been to secure physical supply in size, and delivery can take months. Bill Murphy, author of, forecasts the bank will have a problem with its short silver position in the near future. Could it explode this month? He says yes and explains why. Also, today's gold and silver markets are not the same your father's precious metals markets. The creation of Gold and Silver ETFs, as well as the growth of the precious metals derivatives market, has had a dramatic effect on prices. We talk to Bill Murphy about how growth in precious metals derivatives and ETFs has led to shifts in the metals market. He tells us why we should be concerned that HSBC and JP Morgan serve as custodians for the major gold ETF, the GLD, and the major silver ETF, the SLV, when they also have large short positions in gold and silver. Plus, are lap dances an art form worthy of tax exempt status? New York's highest court is scheduled to weigh the arguments for and against. Lauren and Demetri will give you their take on today's "Loose Change."

Bob English Shines the Light of Inflation upon the Shadow Banking System!

Welcome to Capital Account. Many have looked to Mario Draghi's leaked comments for hints about the upcoming European Central Bank' policy. His comments suggested the ECB could directly buy government bonds maturing in three years or less. Meanwhile, Moody's changed its EU outlook to negative on concerns about the core AAA countries that fund the EU. So with Europe back in the spotlight and its leaders are back from vacation, the team at Capital Account thought it would be a good time to start our engines after a two-week hiatus! Also, Ben Bernanke's Jackson Hole speech brought up a debate between economists about whether the US's unemployment problems are structural or cyclical. Some of those who believe unemployment is cyclical argue inflation is low and the Federal Reserve should do more to help the jobs situation. We look at this assumption about inflation with Bob English, guest contributing editor at ZeroHedge. He takes a special stroll onto Washington's streets to ask ordinary people what, if anything, they know about shadow banking and the role it plays in the inflation vs. deflation debate! And lastly, as the Democratic National Convention gets underway, following the close Republican National Convention last week, the political establishment in Washington vies for support. At a time when distrust in political institutions has been eroded by malfeasance, corruption, and dysfunction, it seems students at Harvard are preparing for their entry to the ruling class by cheating in their intro to congress class. Lauren and Demetri will give you their take on today's "Loose Change."

2 Tornadoes Strike in NYC; No Injuries Reported

Two tornadoes struck the outer edges of New York City on Saturday, one hitting a beachfront neighborhood and the second, stronger twister striking moments later about 10 miles away. No injuries were reported. (Sept. 8)