Here comes the China liquidity post-sugar high crash. In comments published tomorrow (no, not an Art Cashin brain teaser), a senior government economist said that surging money supply is leading to inflation. Yet, since in China apparently you can be half pregnant (preferably with one and a half boys), the recommendation from the government is to increase reserve requirements instead of interest rates. The implication is that it is only a matter of time before both end up getting hiked.

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The Chicago Mercantile Exchange has taken on more short bets on the Euro than ever before in the currency’s history.

According to FT $7.6 billion in Euro shorts have piled up over the past couple of weeks as there is increasing worry about how the currency area is going to deal with the debt problems of many of its members.

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One of the less-reported events this weekend was the not so secret central banker meeting that is taking place in Sidney Australia. Now that factual details are finally emerging it is appropriate to collect some information tidbits about this shindig which has some claiming is reminiscent of a modern day version of the Jekyll Island meeting. From the Sydney Morning Herald.

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How should the European Union help out Greece? By letting inflation rip, says Thomas Straubhaar, president of the HWWI economic institute in Hamburg, Germany.

Allowing inflation to soar would reduce the real burden of the huge nominal debts that have been run up by Greece and other European countries. Of course, diluting the euro might be seen as a desperate remedy to these countries’ problems, but, as Straubhaar points out, there are no good options in this predicament.

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This is an interview with David Servan-Schreiber, MD, PHD, who beat his own cancer, speaking about how to help our natural defenses to prevent and fight the disease.

Terrorists who want to overthrow the United States government must now register with South Carolina’s Secretary of State and declare their intentions — or face a $25,000 fine and up to 10 years in prison.

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The tea party movement is dead. The one I was familiar with anyway. Judson Phillips held it down and Sarah Palin drove a stake right through its heart live last night on C-Span in front of an unsuspecting audience.

Sarah Palin didn’t give a tea party speech last night. She gave a partisan Republican address. It was a purely political speech designed to position her for a presidential run in 2012 or 2016. Period. She wasn’t there to celebrate the organic nature of a movement she had nothing to do with creating. She was there to co-opt the name and claim the brand as hers. And she did.

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“Not inflation”, the gold critics will shout, in one of their go-to arguments. This is what we hear from CNBC’s Mark Haines at every possible chance: since 1980, gold has not kept up with the CPI and so shouldn’t be used as an inflation hedge. One would point out to Mark that this is analogous to arguing for global cooling based on that one 2005 start date. If you pick basically any other start date but the one corresponding to gold’s 1980 peak, you see something different, even giving CPI a long head start over floating gold prices:

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Remember the proverbial run on the bank? Well, that was the norm (or rather the outlier) before governments decided to backstop entire financial industries residing within their territory. As a result, the post-Lehman version of “the bank run” will henceforth be referred to as “the country run” and for an example of one in practice, look no further than Greece. The Guardian reports that investors have pulled a stunning €8-10 billion since the Greek crisis commenced in earnest last November. If true, this is the beginning of the end for the troubled EMU-member country.

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1. Bretton Woods was folded.
2. The floating exchange rate system is about to be folded.
3. By default or design we are going to a one-world currency and a one-world central bank of central banks.
4. For Portugal, Ireland, Italy, Greece or Spain to break off from the euro would be an expansion of the floating exchange rate system under present conditions.
5. There are presently 3 major currencies. That is the US dollar, the euro and gold.
6. The SDR was an attempt to form a single reserve currency that never took flight.
7. The SDR is an accounting unit made up of an index of currencies much like the USDX.

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