Municipal bankruptcies remain extremely rare: Jefferson County was undone by a major sewer project marred by corruption, Harrisburg, PA by borrowing more than it could repay for a disastrous incinerator project, Central Falls, R.I. by pension problems, and Hamtramck, Mich. by the woes of the auto industry. Viewed another way, though, they show how the downturn has left the nation’s most distressed cities with few options for papering over huge problems, and left some desperate elected officials placing their hopes in bankruptcy judges.

Their desire for simple solutions may be in vain, though: for constitutional reasons, the part of the federal bankruptcy code that municipalities use, Chapter 9, sharply limits the power of bankruptcy judges to intervene in local governance.

“Chapter 9 really puts the judge more in the position of being a referee than somebody who can really run the county,” said Paul S. Maco, a partner with the firm of Vinson & Elkins who led the Office of Municipal Securities at the Securities and Exchange Commission during the bankruptcy of Orange County, Calif. — the nation’s largest municipal bankruptcy until this week. “Chapter 9 doesn’t take away the difficult political decision-making needed to address a financial credit problem.”

This story was posted in The New York Times on Thursday...and I thank West Virginia reader Elliot Simon for sending it my way. The link is here.

As many as a dozen members of Congress and their aides took part in insider trading based on foreknowledge of market moving information on Capitol Hill, disgraced Washington lobbyist Jack Abramoff told CNBC in an interview.

Abramoff, who was once one of the wealthiest and most powerful lobbyists in Washington before a corruption scandal sent him to federal prison for more than three years, said that many of those members of Congress bragged to him about their stock trading prowess while dining at the exclusive restaurant he owned on Pennsylvania Avenue.

But Abramoff, whose black trench coat and fedora became one of the most notorious images in recent Washington history after his fall from grace, said he didn't play the stock market himself — he considered it an inherently unfair "casino" in which the house had far more information than the players. Abramoff made most of his fortune representing — and, as it turned out, duping — Native American tribes rich with cash from casino operations.

This cnbc.com story from Friday morning has a 3:21 video interview with Jack Abramoff imbedded in it. This is another offering from Elliot Simon...and the link is here.

Longtime bank analyst Mike Mayo tells the inside story of why it's so hard to yell 'sell' in a crowded room—and lays out how Wall Street needs to change to avoid the next financial collapse.

Over the past 12 years, longtime banking analyst Mike Mayo has issued numerous calls to sell bank stocks, a rarity in a system where nearly all stocks are rated buy or hold. His negative ratings have frequently gotten him in trouble with banks, clients and his own bosses, who didn't want to alienate those companies. In this excerpt from his new book, "Exile on Wall Street," Mr. Mayo gives an inside view of the fights, the scolding and the threatening phone calls he received as a result of yelling "sell"—and offers a proposal to fix the banking sector.

Taking a negative position doesn't win you many friends in the banking sector. I've worked as a bank analyst for the past 20 years, where my job is to study publicly traded financial firms and decide which ones would make the best investments. This research goes out to institutional investors: mutual fund companies, university endowments, public-employee retirement funds, hedge funds, and other organizations with large amounts of money. But for about the past decade, especially the past five years or so, most big banks haven't been good investments. In fact, they've been terrible investments, down 50%, 60%, 70% or more.

This tell-all piece of journalism by long-time bank analyst Mike Mayo, is a real eye-opener...but, like the truths that lobbyist Jack Abramoff spoke, it should come as no surprise. It was posted in the Tuesday edition of The Wall Street Journal...and I thank Washington state reader S.A. for sharing this must read story with us. The link is here.

As oil prices rose ever higher in the last decade, the optimists kept predicting rising production capacity and plummeting prices. Looks like they got it wrong.

We are entering what may be the longest stretch of no growth in world oil production since the early 1980s. But the reasons for that lack of growth differ in ways that ought to make us all uncomfortable.

It's not as if high prices haven't sent people looking for more oil and working on more substitutes. The problem is that all of this activity is facing a considerable headwind. It's called depletion. And, as they say in the oil patch, depletion never sleeps. It's going on in every operating well in every country around the clock, 365 days a year. Estimates suggest that the decline in current production capacity might be around 4 percent per year. That means that 4 percent of the current production capacity for oil must be replaced each year just to break even. And, of course, to grow supplies, new production capacity must exceed this amount. But it hasn't, and oil substitutes haven't really grown by any significant amount in the last six years either.

The media loves to announce new seemingly large discoveries of oil as if they are the solution to what is really an unfolding liquid fuels crisis. They point to the Tupi field off Brazil which is purported to have 8 billion barrels of oil in it. And, they point to discoveries in the deepwater Gulf of Mexico thought to contain between 3 and 15 billion barrels. And, they point to the 24 billion barrels in the Bakken Shale in North Dakota. It all sounds like a lot.

When I ask audiences how long a billion barrels of oil will last the world at current rates of consumption, I often get replies that range anywhere from three months to 5 years. The correct answer is 12 days. Just multiply these multi-billion-barrel discoveries by 12, and you'll realize right away that they are not going to overcome the constraints we are experiencing in oil supplies.

Well, dear reader, if I had to pick just one non-precious metal story out of today's column for you to read...this would be it. Eric Sprott called 2005 the peak for world oil production...and so far he's still right. I, for one, would not want to bet against him.

This absolute must read story was posted over at the oilprice.com website on Tuesday, November 8th...and that's the same day that Roy Stephens sent it to me. The link is here...and the two imbedded graphs should tell you all you need to know.

Under the white-hot pressure of the bond markets and the glare of European leaders, both Greece and Italy snapped into action on Thursday, looking to technocratic leaders to pull them back from the brink of chaos.

Greece named Lucas Papademos, a former vice president of the European Central Bank, interim prime minister of a unity government charged with preventing the country from default. In Italy, momentum was building behind Mario Monti, a former European commissioner, to replace the once-invincible Prime Minister Silvio Berlusconi as early as Monday.

I mentioned in this column earlier this week that Papademos was a member of the Trilateral Commission. Well, it's even worse for Monti. Wikipedia states the following about him..."Monti is the first chairman of Bruegel, a European think tank founded in 2005, and he is European Chairman of the Trilateral Commission, a think tank founded in 1973 by David Rockefeller. He is also a leading member of the Bildergerg Group. Monti is an international adviser to Goldman Sachs and The Coca-Cola Company."

It sounds like democracy has died in both Greece...and heading that way in Italy. One wonders which European nation will be consumed by the dark side of The Force, next.

This 2-page story was posted in The New York Times on Thursday...and is another Roy Stephens offering. The link is here.

Well, Nigel takes no prisoners in this speech before the European parliament in Strasbourg in mid-September. It only runs 4:20...but it's the absolute truth...and a must watch. I thank Roy for providing this youtube.com video...and the link is here.

German Chancellor Angela Merkel says Britain must accept changes to the European Union's Lisbon Treaty to prevent a split in the eurozone, EU diplomats said.

France is said to be drawing up plans to create a breakaway eurozone group, the British newspaper The Daily Telegraph reported Friday. The proposal could diminish Britain's influence in Europe, the newspaper said.

Merkel "explicitly told [Prime Minister David] Cameron that if there was no treaty change at the level of the 27 EU members, then others will peel off, which is not what she wants," a senior EU diplomat told the Telegraph.

This UPI story was posted from Brussels yesterday...and is another Roy Stephens offering. The link is here.

A break-up of the euro, says Vince Cable, would mean an 'economic Armageddon' for Britain. If so, what word is strong enough to describe the euro's survival? What apocalypse, what Götterdämmerung, lies in store for us if the single currency is held together, at the cost of deflation, penury and emigration for its peripheral members and permanent tax-rises for its core? What would be the effect on Britain of the ruin of so many of its trading partners?

The Business Secretary's language will be familiar to anyone who was around 20 years ago. We were told the same thing about the break-up of the euro's baleful predecessor, the ERM. Leaving the mechanism, John Major insisted, would be 'the inflationary option, the devaluer's option, a betrayal of the future of our country'. In the event, of course, our recovery began on the day we left: the blessed sixteenth of September 1992.

Britain doesn't sound like a happy place to be no matter which way the euro or European Union goes. This story from The Telegraph yesterday is another Roy Stephens offering...and the link is here.

A few steps from the National Archaeological Museum in Athens, where visitors gawk at statues of Zeus and other ancient treasures of antiquity, a man crouches under a tree, wraps a rubber band around his arm and shoots up heroin.

Nearby, dirty streets are congested with drug sellers and buyers. Athenians say that cases of drug trafficking, prostitution, murder, thefts, burglaries, petty crime and illegal immigration have all increased as the Greek economy contracts.

Locals say they are seeing more signs of societal strain, with unemployment having risen to 16.3 percent in the second quarter -- up from 12 percent a year ago. Graffiti and shuttered store fronts speckle the winding downtown streets of Athens. Stray dogs and cats, some discarded by families unable to feed them, roam neighborhoods. With refuse workers often on strike these days, it is not uncommon for garbage to pile up on the streets, providing a feast for stray animals. Meanwhile, an uptick in muggings and armed robberies of even gated homes in Athens suburbs has proven deeply unsettling for Greece's middle and upper classes.

This story showed up over at the German website spiegel.de yesterday...and is another article courtesy of Roy Stephens. The link is here.

The French finance minister has reacted angrily to a credit-rating gaffe by Standard and Poor's. The agency accidentally sent out an email suggesting that France had lost its triple-A rating. Many are asking how the firm could have made such an embarrassing slip-up at a time when markets are especially jittery.

Well, to tell you the truth, it probably wasn't a mistake...or a "technical glitch" as the story says. Mistakes like that just don't happen by accident. As I've said before, the U.S. rating agencies are just another part of U.S. foreign and economic policy... to be used when required.

This is another Roy Stephens offering that was posted over at spiegel.de yesterday...and the link is here.

The biggest U.S. prime money-market funds cut their investments in Deutsche Bank AG by $8.1 billion in October, the largest drop among 35 of the largest banks in Europe, the U.S., Japan and Canada, Bloomberg analysis shows.

The amount of Deutsche Bank short-term obligations held by the eight biggest U.S. funds eligible to purchase corporate debt, which included offerings from Fidelity Investments, JPMorgan Chase & Co. and BlackRock Inc., declined by 56 percent to $6.3 billion from Sept. 30 to Oct. 31, according to monthly portfolio updates compiled by Bloomberg and published in today’s Bloomberg Risk newsletter.

“What you are seeing is a domino effect on European banks, which have sequentially been affected as European contagion has spread,” Kinner Lakhani, senior bank analyst at Citigroup Inc., said in an interview. “The key point is that Deutsche Bank is likely to have been much better prepared.”

This Bloomberg story from yesterday is courtesy of West Virginia reader Elliot Simon...and the link is here.

The U.S. trade deficit unexpectedly improved in September, but a significant part of it appears to have been related to flight to safety to gold during September's weak financial markets. The September trade gap shrank to $43.1 billion from $44.9 billion in August. The latest shortfall was narrower than analysts' expectations for a $46.3 billion deficit. Exports gained 1.4 percent after edging up 0.1 percent in August. Imports rose 0.3 percent in September, following a 0.2 percent decline the prior month.

About half of the unexpected improvement in the deficit came from gold exports. Still, exports were moderately strong otherwise and imports were mixed. Given weakness in Europe, the report is encouraging even after discounting gold movement.

Well, based on an average price of $1,750 an ounce..and 'about half' of the 'unexpected improvement', it works out to about 25 tonnes of gold that was exported in September. One has to wonder who got it all...and from whence it came.

This story came out of Barron's...and I thank reader Scott Pluschau for digging this up on our behalf. There is no direct link, but the International Trade numbers were released on Thursday, November 10th at 8:30 a.m....which is easy to find at the link here.

Gold’s spectacular, decade-long run, coupled with the sovereign-debt crisis in Europe, an uncertain outlook for the U.S. dollar, and worries of worldwide recession, has tapped a new vein of investors in their 20s and 30s.

The popularity of gold among young investors speaks to the metal’s impressive role as a store of wealth — and says a great deal about a generation that has seen its share of stock market booms-and-busts, a housing market collapse, and, over the past few weeks, government debt of Greece and Italy trading at yields more akin to junk bonds.

“It was only a matter of time,” said Divnain Malik, head of retail sales at Gold Bullion International, a seller of physical gold in New York. While around half of his clients are baby boomers and more established gold investors, the “younger demographic seems to be catching on.”

This excellent 2-page article posted over at marketwatch.com is a must read in my opinion...and I thank Florida reader Donna Badach for sharing it with us. The photo alone is worth the trip...and the link is here.

Gold traders and analysts are the most bullish in at least seven years as investors accumulate metal at the fastest pace since August to protect their wealth from a widening European debt crisis.

Twenty-one of 22 surveyed by Bloomberg expect bullion to rise on the Comex in New York next week, the third consecutive increase and the highest proportion in data going back to April 2004. Holdings in exchange-traded products backed by gold rose 27.5 metric tons this week, within one percent of the record set almost three months ago, data compiled by Bloomberg show.

“Throughout history, gold has protected people from the sort of turmoil that we’re seeing,” said Mark O’Byrne, the Dublin-based executive director of GoldCore Ltd., a brokerage that sells everything from quarter-ounce British Sovereigns to 400-ounce bars. It’s “an important thing to own when there is this sort of volatility in stock markets and concern about currency devaluations.”

This Bloomberg story was posted yesterday afternoon just before the markets closed. I also would like to point out the three gold-related video interviews in the left side-bar of this piece. Although I haven't had time to look at them myself, I get the impression from the short introductions to each, that they're well worth watching. This Bloomberg piece is also a must read...and I thank Roy Stephens once again for sending it along. The link is here.

Yesterday I 'borrowed' a couple of paragraphs from silver analyst Ted Butler's Thursday column on the MF Global debacle. Ted has seen fit to publish the entire essay in the clear...and it's posted over at the silverseek.com website. Roy Stephens dug this up on our behalf...and it's his last offering in today's column. This, too, is a must read from one end to the other...and the link is here.

Interviewed by King World News, geopolitical analyst James G. Rickards takes note of the speculation about the disposition of Germany's gold reserves and doubts that Germany ever could retrieve the portion held in the United States.

Yesterday, only the blog was available. I received the full audio interview in the wee hours of this morning. It's a must listen for sure...and the link is here. I thank Chris Powell for providing the introduction.

Tocqueville Gold Fund manager John Hathaway told Eric King yesterday that most brokerage houses view gold mining shares as if gold will be priced at only $1,300 in five years, even as Hathaway himself sees massive inflation as the only way out for central banks. An excerpt from the interview, headlined "Hathaway - Sell Side to get Slaughtered on Bearish Gold Calls", is posted at the King World News website...and the link is here.

Chris Powell began the introduction thusly..."GoldMoney's James Turk interviews market analyst Doug Casey, who surveys the international economic scene...and doesn't seem very happy that that big asteroid missed hitting Earth the other day." Turk's interview with Doug runs 54:10 long.

This is another must watch interview. It just arrived in my in-box minutes after midnight...and I've had no time to watch it yet, but it's on my 'to do' list for later today. It's posted over at the goldmoney.com website...and the link is here.