The man in charge of the biggest U.S. city ever to file for bankruptcy is clear about the root of the crisis.

It was a decision that gave firefighters full health care in retirement starting on January 1, 1996, said Bob Deis, the city manager of Stockton, California.

At the time, the move seemed cheaper than giving pay raises sought by unions, officials involved in the decision said. When other Stockton employees demanded the same healthcare deal in following years, the city agreed.

Deis, who signed Stockton's bankruptcy filing last Thursday, slammed the decision to provide free health care to retirees as a "Ponzi scheme" that eventually left the city with a whopping $417 million liability.

This Reuters piece from Tuesday is courtesy of Washington state reader S.A...and the link is here.

Three years ago, Gina Ray, who is now 31 and unemployed, was fined $179 for speeding. She failed to show up at court (she says the ticket bore the wrong date), so her license was revoked.

When she was next pulled over, she was, of course, driving without a license. By then her fees added up to more than $1,500. Unable to pay, she was handed over to a private probation company and jailed — charged an additional fee for each day behind bars.

For that driving offense, Ms. Ray has been locked up three times for a total of 40 days and owes $3,170, much of it to the probation company. Her story, in hardscrabble, rural Alabama, where Krispy Kreme promises that “two can dine for $5.99,” is not about innocence.

It is, rather, about the mushrooming of fines and fees levied by money-starved towns across the country and the for-profit businesses that administer the system. The result is that growing numbers of poor people, like Ms. Ray, are ending up jailed and in debt for minor infractions.

This story was posted in The New York Times on Monday...and I thank reader Randall Reinwasser for sharing it with us. The link is here.

Paul Tucker, the Bank of England's deputy governor, says he is keen to give evidence to the Treasury Select Committee "as soon as possible" to clarify what he sees as the misconceptions surrounding the Libor fixing scandal.

Let's hope he gets his wish, because clarity is one thing we didn't get on Wednesday from Bob Diamond's appearance.

Diamond didn't satisfy the MPs and the MPs certainly didn't satisfy any watching voters with a session that rarely rose above the mundane. It was not a good advert for the committee which, with one or two exceptions, needs to be better briefed and cleverer in its questioning.

But there were a few simple truths that emerged with a little more definition. Clearly Andrew Tyrie, the TSC's chairman, believes Diamond's infamous memo which emerged on Tuesday does read as Tucker giving Barclays the nudge and wink to lower its Libor submissions in October 2008. "It reads that way to anyone that looks at it," he said.

This story appeared on the telegraph.co.uk website on Wednesday evening...and it's Roy Stephens first offering of many in today's column. The link is here.

Just when the Committee was getting bogged down in detail, John Mann, Labour MP for Bassetlaw, cut to the quick. “Can you remind me the three founding principles of the Quakers who founded Barclays?” he asked Bob Diamond.

As the deposed bank boss sat stoney-faced, Mann continued: “Honesty. Integrity. Plain dealing. That’s the ethos of the bank you’ve just spent two hours telling us is doing so well - in fact so well that I wonder why you’ve not received an extra bonus rather than the sack.”

He was just warming up. “You’re the man in charge. But you’re accepting all the good things and the bonuses [and] the people working for you are fiddling the system, potentially going to prison... give me a suggestion of how you’re going to show contrition to those staff and customers who are wondering whether to take their money out of this rotten, thieving bank?”

Had Barclays, the venerable British bank that traces its roots back to 1690, really sunk so low?

This is Roy's second offering of the day. It, too, was posted over at The Telegraph on Wednesday evening...and the link is here.

Moody's on Thursday cut its outlook on Barclays' financial strength rating to "negative" from "stable" after the British bank's top executives resigned this week over an interest rate rigging scandal.

"Moody's Investors Service has today changed the outlook on the C-/baa2 standalone bank financial strength rating (BFSR) of Barclays Bank Plc to negative from stable," the ratings agency said in a statement.

The decision reflects "concerns that the senior resignations at the bank and the consequent uncertainty surrounding the firm's direction are negative for bondholders."

This AFP story was posted on the france24.com Internet site yesterday...and is Roy Stephens third article of the day. The link is here.

Ballistic? How about supernova. This 26-minute, 4-person panel discussion on Aljazeera sort of gets out of hand when Max blows up starting around the 12:15 mark. The whole interview is worth your time if you have it. But watching Max lose it is worth the trip. The interview is posted on the ritholtz.com website...and I thank reader 'Tom in Thailand' for sending it our way. The link is here.

Rodrigo Rato, the former head of the International Monetary Fund, is to face trial for alleged fraud in connection with the spectacular collapse of Spanish lender Bankia.

Mr Rato, who quit as chairman of the bank in May just before it was bailed out to the tune of €23.5bn (£18.9bn), is named alongside 32 other Bankia managers in a lawsuit brought by UPyD, one of Spain’s smaller political parties.

Hours after the legal probe was announced, Bankia's chief executive Francisco Verdu, abruptly quit, announcing the move in a one sentence regulatory filing.

Spain’s top national court on accepted the suit, alleging fraud, price-fixing, embezzlement and falsifying accounts, though no date has yet been set for the hearings.

The rot just gets deeper and closer to the top of the financial food chain with each passing day. This is another story posted on Wednesday evening at The Telegraph...and I thank Roy Stephens for digging it up. It's worth the read...and the link is here.

Italy has almost doubled its deficit forecast, as Germany halved its, underscoring the increasing lag of "sinner states".

Mario Monti, the Italian prime minister, told a joint press conference with Angela Merkel, the German chancellor, that Italy's deficit would rise to 2pc of GDP rather than the 1.3pc predicted, while the German finance ministry revised its forecast from 1pc to 0.5pc "thanks to the favourable overall economic development".

Referring to their clash at the Brussels summit, Mrs Merkel said she and Mr Monti were "willing to overcome our difficulties" and work together to end the three-year-old debt crisis. She said that "every day counts" in finding a resolution.

Francois Hollande, the French president, announced €7.2bn (£5.8bn) of tax rises in a bid to relieve France's "crushing" national debt. The government expects the French economy to grow by just 0.3pc this year, compared with previous estimates of 0.7pc. Despite the gloom, markets have risen in recent days in anticipation of an ECB rate cut.

This is another Roy Stephens offering from late Wednesday night. It, too, was posted on the telegraph.co.uk Internet site...and the link is here.

European Commission President Jose Manuel Barroso Tuesday (3 July) launched an angry attack on British Conservative's in the European Parliament, accusing them of "taking delight" in the eurozone debt crisis.

"Let me just put the facts straight. The country by far that has been spending money with the banking sector is Britain," he said citing the Conservatives' disapproval of the "big bailout programmes in the banking sector in the euro area."

Barroso's outburst in Strasbourg followed a speech by Tory MEP Martin Callanan, who heads the eurosceptic ECR group, claiming that that the eurozone should "reduce in size so that some countries have the ability to devalue their way back to relative competitiveness."

Callanan, who represents the more eurosceptic wing of his party, has repeatedly called for Greece to be allowed to leave the EU.

Another classic example of the pot calling the kettle black. A pox on both their houses! This was posted on the euobserver.com website on Wednesday...and I thank Roy once again for sending it along. The link is here.

Concerned about waning economic growth, central banks in Europe and China announced measures Thursday to increase borrowing and spending by businesses and consumers, a response that was all the more striking because it was uncoordinated.

Three major central banks announced policy changes in the space of an hour. China’s central bank unexpectedly cut regulated bank lending rates for the second time in four weeks. The European Central Bank cut its benchmark interest rate to 0.75 percent, the lowest level in its 14-year history. And the Bank of England announced it would expand its holdings of government bonds by about 15 percent.

The Federal Reserve announced two weeks ago that it would extend its own bond-buying program until the end of the year.

The actions once again cast central bankers in the role of primary responders to the global economic malaise, aiming at the same basic goal that they have tried to hit repeatedly over the last six years: encouraging people and businesses to borrow and spend and take greater risks with their investments.

I can tell you right now, dear reader, that this isn't going to make one bit of difference. Japan's zero interest rate policy is proof of that. This story was posted in The New York Times yesterday...and I thank Washington state reader S.A. for digging it up on our behalf. The link is here.

"The risks surrounding the economic outlook for the euro area continue to be on the downside," ECB President Mario Draghi said in a statement. "They related, in particular, to a renewed increase in the tensions in several euro area financial markets and their potential spillover to the euro area real economy."

Still, despite the fact that the ECB rate is now below 1 percent for the first time in the history of the euro zone, hopes are not high that the rate cut will have much of an effect on the economy.

A raft of recent data has pointed to rough times ahead for the euro-zone economy as a whole. And the German economy, the largest in the common currency area, is also facing a modest downturn.Moreover, the rate cut is not expected to ease the euro crisis or take pressure off the high borrowing costs that have made it increasingly difficult for Italy and Spain to refinance their debt.

"The interest rate cut will likely not have measurable effects on real economies in crisis-stricken countries," Kai Carstensen of the Munich-based Ifo Institut, told Reuters. "In my opinion, the interest rate cut can best be understood as a further step to subsidize struggling banks."

This story was posted on the German website spiegel.de yesterday...and is worth skimming. Roy sent us this story as well...and the link is here.

Greece's new finance minister, Yannis Stournaras has admitted that the country is "off-track" to meet the conditions of its bail-out agreements while his predecessor warned Athens would need three-years to get back on track.

Mr Stournaras, who was sworn in just hours before he met Greece's international paymasters yesterday, said the political uncertainty surrounding two general elections had hit the country's finances even more.

"The economy has gone through two difficult elections and the programme is off-track in some respects, and it is on track in others," he told reporters.

Evangelos Venizelos, the leader of Greece's Pasok party and former finance minister, said Greece needs a "realistic framework" and called for its bailout plan to run until 2017.

This story was posted on the telegraph.co.uk website last evening...and I thank Roy Stephens once again for sharing it with us. The link is here.

Denmark's central bank cut interest rates by a quarter point on Thursday, mirroring the European Central Bank's action earlier in the day, putting one of its secondary rates below zero for the first time in history.

Yields on some short-end Danish government bonds had already turned negative earlier, as investors fearful of turmoil in the euro zone have piled into non-euro assets, including Danish bonds, and are were willing to pay to shelter their money.

The Nationalbank cut its lending rate to 0.20 percent from 0.45 percent and lowered its certificates of deposit (CD) rate to negative 0.20 percent from 0.05 percent to match the ECB's move and to curb strength in the Danish currency.

I dug this Reuters story out of a GATA release just before I hit the 'send' button today's column...and the link is here.

Iran is prepared to launch missiles at US bases throughout the Gulf within minutes of an attack on the Islamic Republic, according to a commander of the country's Revolutionary Guards.

In an apparent response to reports that the US has increased its military presence in the Gulf, the commander of the Revolutionary Guards' air force said on Wednesday that missiles had been aimed at 35 US military bases in the Gulf as well as targets in Israel, ready to be launched in case of an attack.

The semi-official Fars news agency reported Brigadier General Amir Ali Hajizadeh as saying: "We have thought of measures to set up bases and deploy missiles to destroy all these bases in the early minutes after an attack."

This story showed up in The Guardian early Wednesday evening...and is Roy Stephens final offering in today's column. The link is here.

Australia will step up its campaign to boost economic ties with its largest trading partner China when Treasurer Wayne Swan heads to Beijing next week hoping to secure a deal to make the Australian dollar the third currency to be directly convertible with the yuan.

Mr. Swan will lead a forum in Hong Kong on Wednesday on the internationalization of the yuan -- a strategy pursued by China to ease away from dependence on the U.S. dollar as a reserve currency -- before heading to Beijing for more direct discussions with officials.

"Internationalization of the yuan is clearly in the interests of Australian businesses and the broader Australian economy, which is why we've been taking action to promote and deepen the market in yuan/Australian dollar transactions," Mr. Swan said.

This subscriber-protected story showed up in The Wall Street Journal yesterday...and is posted in the clear in this GATA release...and the link is here.

The first is with Louise Yamada...and it's titled "Gold & Silver at Critical Points in This Cycle". The second is with Egon von Greyerz...and it's headlined "We're Dealing With Government Lies and Misinformation". The third blog is with Michael Pento...and it's entitled "Central Bank Fireworks Are Just Around The Corner". The fourth blog is with Caesar Bryan. It bears the headline "Central Planners Are Making Desperate Maneuvers Right Now". And lastly is this audio interview with Rick Rule.

Shaking his fist and surrounded by angry colleagues, South African gold miner Chres Manyaka raged against 'fat cats' getting rich from the sweat of the workers.

But he was not talking about managers of the Gold One company, which had sacked him and several other fellow workers for an illegal strike at the mine east of Johannesburg.

Manyaka's tirade was against bosses of the National Union of Mineworkers (NUM), a pillar in the trade union alliance that brought workers to the fight against apartheid and helped carry the African National Congress (ANC) to power in 1994 in the continent's largest economy and No. 1 platinum producer.

"If you go and see the NUM people you can see the big stomachs. NUM now is like management," 28-year-old Manyaka said outside Gold One's entrance.

I found this Reuters story in a GATA release yesterday...and the link is here.

On Wednesday South Africa's home affairs minister Nkosazana Dlamini-Zuma became the latest senior figure in the ruling African National Congress party to add her voice to the growing chorus of officials calling for greater state involvement in mining reports Business Day.

"We should take control of our natural resources. We should beneficiate and also ensure that we do get sufficient benefit from these mineral resources," Dlamini-Zuma told delegates to an African leaders conference in the nation's capital. "At the moment, the company doing the extraction, (the) beneficiation, gets the resources and gets the financial benefit while the countries and its people receive very little," she said."

Dlamini-Zuma, who is a favourite candidate to take over as chair of of the African Union and is also the ex-wife of South Africa's president Jacob Zuma, made her comments one day after all three major global ratings agencies – Fitch, Moody's and Standard & Poor's – placed South Africa's credit rating on negative outlook, a move that raises borrowing costs for government and the private sector and has the potential to scare away investors.

This story was posted on the mining.com Internet site yesterday...and I consider it a must read. I thank Australian reader Wesley Legrand for sending it along...and the link is here.

Much has been made recently about the gap between prices of gold equities and the underlying metal. Depending on which side of the fence they are invested commentators take it to mean bearish things for bullion or very bullish ones for the gold equities.

Tom Kendall, director of commodities research at Credit Suisse, maintains however, that one shouldn't read too much into the dislocation in the current market.

Speaking on Mineweb.com's Gold Weekly podcast, he said, there are two key factors that make him cautious about interpreting anything from the discount of gold equities to the underlying price.

Well, if we had a free market in both gold and silver, I think that this writer would be proven wrong in very short order. Everyone is entitled to their opinion, I suppose...and this is just his. I thank reader Donald Sinclair for sending this mineweb.com story our way...and the link is here.

Figures for the first five months of this year published yesterday by China's Ministry of Industry and Information Technology show the country's gold output for the period rose 6.59% year on year to 140.7 tonnes. However this suggests that the world's largest gold producer's pace of increase in output could be declining, although it is yet too early to say. But, in relation to the 10% year on year gold production growth reported at the end of the first quarter the latest figures suggest the rising trend in output may have declined in April and May.

Even so, May gold production was still put at 31.2 tonnes - a figure which, if extrapolated over the full year would see total output rise nearly 4% above last year's total of 360.96 tonnes.

While such figures do give a guide to the general direction of the country's gold mining industry they may well not tell the true picture. Some commentators have suggested China produces more gold than the official figures suggest noting that small mines outside the aegis of the China Gold Association do not necessarily have their gold recorded in official statistics and also that the significant gold by-product from China's big base metals concentrate custom smelting industry may also not be included in official figures.

Without doubt the Chinese are holding far more gold than their official figures state...and when it suits them, they'll let us know how much they really have. I found this story posted over at the mineweb.com Internet site...and it's worth skimming. The link is here.

What’s the difference between legal tender and spending money?

A big headache for a Scarborough man who learned the hard way that banks aren’t obligated to honour collector’s coins at face value, even if they come from the Royal Canadian Mint.

On Tuesday he needed money quickly, and with no cash at hand he headed to a CIBC branch near Kingston Rd. and Midland Rd. with one of his silver coins, hoping to exchange it for cash or deposit it into his account.

But the teller there told him he could do neither, rejecting Fokine’s silver coin.

You can read the rest of this story that was posted in The Toronto Star yesterday...and I thank West Virginia reader Elliot Simon for sharing it with us. The link is here.

A great deal of Gordon Brown’s economic strategy would strike a sane man as troubling. Not a great deal was mysterious. The orgy of consumption spending, frequent extensions of the cycle over which he would “borrow to invest”, proclamations of the “end of boom and bust”: these are part of the armoury of modern politicians, of all political hues

One decision stands out as downright bizarre, however: the sale of the majority of Britain’s gold reserves for prices between $256 and $296 an ounce, only to watch it soar so far as $1,615 per ounce today.

When Brown decided to dispose of almost 400 tonnes of gold between 1999 and 2002, he did two distinctly odd things.

First, he broke with convention and announced the sale well in advance, giving the market notice that it was shortly to be flooded and forcing down the spot price. This was apparently done in the interests of “open government”, but had the effect of sending the spot price of gold to a 20-year low, as implied by basic supply and demand theory.

Second, the Treasury elected to sell its gold via auction. Again, this broke with the standard model. The price of gold was usually determined at a morning and afternoon "fix" between representatives of big banks whose network of smaller bank clients and private orders allowed them to determine the exact price at which demand met with supply.

Of course all this was "revealed" by GATA...and particularly gold price suppression litigator Reginald H. Howe not long after it happened a decade ago, and GATA has been repeatedly thrusting it at The Telegraph ever since then, but it's thrilling to see a mainstream news organization getting around to it even this late. The link to this absolute must read GATA release, is here.