This year, US public debt could reach end game

Federal Reserve Chairman Bernanke issues the warning. Asian nations, China and India first, are no longer willing to purchase securities issued by the US Treasury, which this year has about US$ two trillion short-term debt to refinance. Beijing is buying gold instead.

Milan (AsiaNews) – For at least four years, AsiaNews has sounded the alarm bells against the risks due to the huge size reached by speculative finance [1] . In 2008, we said that the attempt to save US banks could push the US debt beyond the point of solvency (see Maurizio d’Orlando, “ US debt approaches insolvency . . .,” in AsiaNews 19 December 2008) [2] . Back them it could appear a bitoverblown, but now even US Federal Reserve Chairman Ben S Bernanke is warning the US Congress about the danger. In a statement before the House Financial Services Committee,[3] he said that the US public debt might no longer be sustainable very soon. Financial jargon aside, the subtitle of an article by The Washington Times —Stage is set in U.S. for a Greek tragedy—says it all. Interviewed for the article, Bernanke says the United States is likely to face a debt crisis like the one in Greece sooner than later, “not something that is 10 years away”.

http://tinyurl.com/yjkjx2x

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UPDATE: WGC Says IMF Gold Sales Won't Be 'Disruptive'

 
   By Matt Whittaker 
   Of DOW JONES NEWSWIRES 
 

NEW YORK (Dow Jones)--The World Gold Council, a mining industry body, said Thursday it does not anticipate that the remaining International Monetary Fund gold sales will disrupt markets.

"The successful first phase sale to central banks had no impact on the smooth functioning of the gold market, and the remaining sales to be undertaken in phase two of the program are also not anticipated to be disruptive," the WGC said. "The sales by the IMF in phase two do not represent a net addition to supply because they will be accommodated under the Central Bank Gold Agreement."

Since 1999, European central banks have been allowed to sell up to 500 tons of the precious metal a year under the CBGA.

Last year, the IMF earmarked 403.3 metric tons of gold for sale to raise funds for poorer nations. It has sold more than half to India, Sri Lanka and Mauritius but wasn't able to find any more central bank buyers.

Late Wednesday, the IMF said it will soon begin to sell the remaining 191.3 tons of gold to the open market.

"In accordance with the priority of avoiding disruption of the gold market, the on-market sales will be conducted in a phased manner over time," the IMF said Wednesday in a statement.

Gold futures prices sank to $1,098.10 an ounce in electronic afterhours trading following the announcement. But as the market digested the news, the metal has recouped losses during Thursday floor trading on the Comex division of the New York Mercantile Exchange. The most-active April futures were down $3.80, or 0.3%, at $1,116.30 an ounce in recent trading.

The "initial shock" of the IMF announcement was wearing off, said Frank Lesh, broker and futures analyst with FuturePath Trading. "It'll be parsed out little by little."

Carlos Sanchez, associate director of research with CPM Group believes central banks will continue buying gold, even though the IMF isn't selling directly to the official sector this time.

While the IMF is making the gold available to the wider market, that "doesn't mean that central banks won't buy the gold," Sanchez said, noting the announcement comes at a time of already reduced CBGA sales.

Since the agreement was struck, European central banks have consistently sold more than 300 tons a year, but last year the amount fell to 157 tons. Sanchez said that leaves room for the absorption of the IMF sales.

http://tinyurl.com/yjgbnqt

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Note: This article says gold sale to benefit poor countries.

Remember we already know our gold was transferred and laundered throughy Citi to IMF. (See my post, "Something is up"

Now it's about to disappear altogether. BEWARE!

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