Daily Archives: 9 January 2013

Palestinian Authority officially changes name to ‘State of Palestine’

open quote Palestinian President Mahmoud Abbas signed a presidential decree on Friday officially changing the name of the Palestinian Authority to the “State of Palestine.” All Palestinian stamps, signs and official letterhead will henceforth be changed to bear the new name, according to the official Palestinian news agency Wafa.

The move marked the first concrete, albeit symbolic, step the Palestinians have taken following the November decision by the United Nations to upgrade their status to a non-member observer state. Abbas, who has enjoyed a boost in his status since the successful bid at the United Nations, has hesitated to take more dramatic steps, like filing war crimes indictments against Israel at the International Criminal Court, a tactic that only a recognized state can carry out.

Also on Friday, tens of thousands of Fatah supporters rallied in the Hamas stronghold of Gaza for the first time since they were routed from power there by the Islamist militants in 2007.

The rally, approved by Gaza’s Hamas rulers, marks a renewed attempt by the rival Palestinian factions to show unity following a fierce Hamas battle with Israel in November and Fatah’s recognition bid at the United Nations. close quote (Read more)

How the Fed will be FORCED to peg the dollar to gold (?)

open quoteFrom Dan Amoss of the Daily Reckoning, originally published in September 2012:

“For years, I’ve expected that at the end of all this central bank printing, we’ll see the end — not a reversal — of quantitative easing programs and a re-pegging of the US dollar to gold at much higher gold prices. A new gold standard would allow the Fed and other central banks to save face after the following sequence of events:

1. Central banks inflate their balance sheets and buy up many of the bonds governments issue to fund soaring budget deficits
2. Once the largest suppliers of scarce products realize they’re exchanging products for infinitely diluted paper money, they start demanding more and more money in exchange for sending their scarce products to the marketplace
3. Consumer prices start rising
4. Calls for monetary tightening (reduction of central bank balance sheets and interest rate hikes) grow louder
5. These central banks won’t be able to slash money supplies without crashing government bond markets and stock markets. They talk about tightening, but don’t tighten
6. As central banks lose credibility, gold launches on a final, near-vertical stage of its bull market
7. In response to inflation expectations running wild, governments and central banks draw up plans to re-peg currencies to gold in order to avoid having to drain trillions worth of cash from the banking system.”

In the face of imminent hyperinflation, Dan Amoss postulates that the Fed will back the dollar with gold at some significantly higher price in order to avoid a complete collapse of the dollar. It is reassuring that the Fed can do this, but will it? Another scenario is that some large and important country, such as Germany or China, will back its currency with gold and cause demand for the dollar as the preferred means of international settlement to fall. This will cause prices to rise in the US as overseas dollars start to flow back into the only economy where they must be accepted for all debts public and private.close quote (Read more)