A growing number of Federal Reserve officials have concluded that the central bank needs to expand its stimulus campaign unless the nation’s economy soon shows signs of improvement, including job growth.

The question is expected to dominate the agenda when the Fed’s policy-making committee meets next week, with some members pushing for immediate action while others seek to delay a decision at least until the committee’s next meeting in September, so they can see a few more weeks’ worth of economic data.

The Fed’s chairman, Ben S. Bernanke, told Congress last week that the options under consideration included a new round of asset purchases, or “quantitative easing,” often described as QE3. As part of any such program, officials increasingly favor expanding the Fed’s holdings of mortgage-backed securities for the first time since 2010.

This story was posted on The New York Times website yesterday...and I thank Phil Barlett for sending it. The link is here.

The number of workers taking federal disability insurance payments hit yet another record in July, increasing to 8,753,935 during the month from the previous record of 8,733,461 set in June, according to newly released data from the Social Security Administration.

The 8,753,935 workers who took federal disability insurance payments in July exceeded the population of 39 of the 50 states. Only 11 states—California, Texas, New York, Florida, Illinois, Pennsylvania, Ohio, Michigan, Georgia, North Carolina and New Jersey—had more people in them than the number of workers on the federal disability insurance rolls in July.

Virginia, the twelfth most-populous state, had 8,096,604 people in 2011, according to the latest Census Bureau estimate. That would make Virginia’s population about 657,331 less than the number of workers who took federal disability insurance payments in July.

I thank Scott Pluschau for sending me this story posted on the cnsnews.com Internet site on Monday...and the link is here.

One day, we hope, the broader public will realize that just as the Libor scandal was largely precipitated by the fact that it was a self-reported number and thus open to collusion and manipulation by the same people who set it, so any data coming out of the National Association of Realtors - an organization that by definition benefits from high prices and frenzied real estate activity - is total manipulated garbage.

In fact, when it comes to the NAR, it is worse: as a reminder, US real estate transactions are nothing but glorified and perfectly legal money laundering, which is the main reason why the NAR has a waiver from regulation for anti-money laundering.

As the following three charts from Bloomberg confirm the last word one should use when discussing the US housing market, where as we already pointed out shadow inventory is once again building up while construction jobs have tumbled to decade lows, is "bottomed."

This Zero Hedge story was sent to me by Washington state reader S.A...and the link is here.

Banks that trade for their own accounts should not benefit from the implicit backing of taxpayers, and Wall Street's opposition to new rules curbing such activities is unfounded, a top Federal Reserve official said on Monday.

Federal Reserve Governor Sarah Raskin, a former Maryland financial regulator, said the notion that derivatives markets enhance firms' ability to raise capital was questionable.

"I view proprietary trading as an activity of low or no real economic value that should not be part of any banking model that has an implicit government backstop," Raskin told students at the Graduate School of Banking at Colorado in remarks made available in Washington.

"Much of this so-called liquidity, especially in opaque over-the-counter markets, is potentially illusory and destabilizing, especially during adverse market conditions, which does not benefit the public."

This story was posted on the Reuters Internet site early on Monday evening...and is Washington state reader S.A.'s second offering in a row in today's column. The link is here.

Investors have by now heard of the LIBOR scandal engulfing the banking industry. LIBOR stands for the London Interbank Offered Rate. To some it may be just the latest entry on a list of bank frauds and blunders in recent years, from mortgage scams to MF Global and the London Whale.

In fact, this may be the mother of all scandals—the one that finally leads to criminal charges and the insolvency of major banks. The fraud is breathtakingly easy to understand once past a small amount of jargon. Indeed, the simplicity of the fraud is the greatest threat to the perpetrators because here at last is a fraud that is easy for juries to understand and for prosecutors to prove.

LIBOR is set by a committee of banks sending their estimates of the rate at which they could borrow to a trade association. The banks on the committee are among the largest in the world including J.P. Morgan, Citibank, and Bank of America. The trade association would discard the highest and lowest rates and average the rest to arrive at the official LIBOR. This would then be published on financial news services. Payments due under LIBOR transactions would be calculated using that published rate.

We now know that some of the banks on the committee lied about the rates for a period of six years from 2005 to 2010, perhaps longer. The lies had two purposes. The first was to make money for the bank by lowering what it had to pay on LIBOR-based contracts. This is a kind of direct theft from customers. The second reason involved hiding the fact that some banks were being asked to pay high rates during the Panic of 2008. This is considered a sign of distress. By lowering the reported rate, the banks were made to appear healthier than they were and committed a fraud on the market as a whole.

This story was posted on the usnews.com website on Monday...and I thank Miami reader Harold Jacobsen for bringing it to our attention. The link is here.

The decision by Moody's to cut its outlook for Germany's triple-A rating to negative could stiffen German resistance to providing more financial assistance to Greece, which is asking for more time to meet the conditions of its bailout.

Politicians in Berlin played down the announcement, saying the German economy remained buoyant and structurally sound. But they added that cut was further evidence that Germany's own firefighting resources are limited, and that the government would struggle to persuade lawmakers and taxpayers to support further aid.

A spokesman for Chancellor Angela Merkel said the government had "taken note" of the Moody's statement, adding: "The chancellor has repeatedly stressed that Germany's power is not unlimited."

This story was posted on the German website spiegel.de yesterday...and the first reader through the door with this story was Donald Sinclair...and the link is here.

German Economy Minister Philipp Rösler, leader of the pro-business Free Democratic Party (FDP), has come under fire for comments he made about Greece on Sunday that contributed to uncertainty in financial markets on Monday, when the euro fell to its lowest level against the dollar in more than two years.

Rösler was accused of being reckless and unprofessional by saying in a television interview that he was "more than skeptical" that Greece's reform efforts will succeed.

"If Greece no longer meets its requirements there can be no further payments," he said in an interview with German public broadcaster ARD. "For me, a Greek exit has long since lost its horrors."

This is another spiegel.de story that Donald Sinclair sent me...and the link to that is here.

Finland reached a deal with Greece and Spain to get collateral in exchange for its share in any bailout packages. The deals are controversial, with critics worried that they may herald a quiet Finnish exit from the euro. In a SPIEGEL interview, Finance Minister Jutta Urpilainen, 36, defends the policy, saying her country wants to keep the euro intact.

This short interview was posted on the spiegel.de Internet site yesterday...and I thank Roy Stephens for sending it. The link is here.

Financial market fears over a possible Greek exit from the single currency were fanned on Tuesday by a gloomy assessment of the country's economic plight from international debt inspectors and evidence of a growing rift between Athens and Berlin.

Officials from the so-called troika – the IMF, the European Union and the European Central Bank – warned that Greece had failed to keep to the deficit reduction plan agreed earlier this year.

Arriving in Athens for talks with the coalition government, one official was quoted as saying: "Greece is hugely off track. The debt-sustainability analysis will be pretty terrible."

This story was posted on The Guardian website early this morning...and I thank Roy Stephens for sharing it with us. The link is here.

The cities at risk of running out of money include Naples, Palermo in Sicily and Reggio Calabria, on the toe of the Italian boot, according to the Italian press.

"The situation is becoming worse by the day," said Graziano Del Rio, the president of a national association of municipal councils.

The warning came just days after Mario Monti, the prime minister, expressed fears that Sicily, which has a high degree of fiscal autonomy, was on the brink of a default.

Cities and towns in southern Italy have for years been plagued by mismanagement, corruption, the wasteful use of EU funds and infiltration by the Mafia. But the "black list" of cities at risk also includes some in the north of Italy such as Alessandria, in the Piedmont region.

This story was posted on the telegraph.co.uk Internet site early Monday evening...and is certainly worth reading. I borrowed this story from yesterday's edition of the King Report...and the link is here.

Trotting out a now all-too-familiar line over the weekend, Mario Draghi, president of the European Central Bank, said nobody should underestimate the political will behind saving the euro, or the support the single currency continues to command among the general public.

Monetary Union, he declared, was “irreversible”, as if merely to repeat the assertion is to make it so.

This is the sort of pretence that policymakers feel obliged to indulge in at times of crisis – it would indeed be unimaginable for the president of the ECB to say anything else – but looking at the evidence around him, it seems somewhat unlikely that this wise and somewhat reserved central banker could actually believe what he is saying.

The situation, as Mr Draghi is only too aware, is utterly desperate, with Spain threatening to blow the whole thing up unless supportive action is taken soon.

As things stand, policy demonstrates the almost complete opposite of the political will Mr Draghi refers to; at every step, policymakers thwart or repudiate the sort of initiatives that might save the project. Almost nobody in Europe is ready for the loss of fiscal and political sovereignty that lasting solutions demand, with some countries already fast backtracking even on the relatively un-ambitious measures to fix the single currency’s institutional framework agreed at the last summit.

This must read story was posted on The Telegraph's website on Monday evening...and is another Roy Stephens offering. The link is here.

The first blog is with Citi analyst Tom Fitzpatrick. It's headlined "What To Expect Next For The US Dollar, Euro, Stocks & Bonds". The second is with Stephen Leeb...and it's entitled "It's Absolutely Shocking How Much Gold China Is Acquiring". The next blog is with Rick Rule. It's headlined "The Return Of The Mega-Bullish "Fear Trade" In Gold". And lastly is this audio interview with BMO's Donald Coxe. I posted Don's blog yesterday.

US-Investor and gold expert Jim Rickards believes that the gold price won't fall below $1,500 dollars per ounce...and that the loss of confidence in currencies will lead to a new gold standard.

This interview was posted on the Austrian website format.at late Monday afternoon...and I thank Miami reader Harold Jacobsen for his second and final offering in today's column. It's certainly worth reading...and the link is here.

German journalist Lars Schall presents Part 2 of his interview with Erste Bank analyst Ronald Stoeferle about gold's prospects. It's headlined "Gold Goes Where the Money Is" and it's posted at Matterhorn Asset Management's GoldSwitzerland Internet site...and the link is here.

Through its lawyer, William J. Olson P.C. of Vienna, Virginia, GATA today filed federal Freedom of Information Act requests with the U.S. State Department, Treasury Department, Federal Reserve Board, and Federal Open Market Committee, greatly expanding upon GATA's 2009 FOIA request to the Fed, which sought access to records involving gold swaps.

The 2009 FOIA action elicited a revealing admission from the Fed that it has secret and highly sensitive gold swap agreements with foreign banks -- an admission that the Fed, despite its many previous denials, is indeed surreptitiously active in the gold market. That FOIA action led to GATA's lawsuit against the Fed in U.S. District Court for the District of Columbia, which last year produced both a judicial finding that the Fed has many gold-related secrets and a verdict enough in GATA's favor that the Fed was required to pay court costs to GATA

This GATA release, with an extensive preamble by Chris Powell...part of which you've already read...is well worth your time. If you have the time, there's lots of links to keep you busy for quite a while...and the link to the GATA release is here.

A court ruling that stripped a Chinese investor of millions of yuan gained six years ago from transactions of paper gold with the world's largest bank has triggered a fresh wave of public criticism.

Song Ronggui, whose gains of 21 million yuan ($3.33 million) were retrieved by the Industrial and Commercial Bank of China, the world's biggest lender by market value, said it would challenge the investor's appeal to the Supreme People's Court.

Song said he had lodged an appeal after the Higher People's Court of Shandong province recently issued a final sentence that favored the bank's cancellations of 126 transactions of cash-settled and non-delivery contracts.

"I'm very upset (at the ruling)," Song said, vowing to continue the legal proceedings at the Supreme People's Court.

In its final judgment, the Higher People's Court of Shandong supported the move by the ICBC branch in the provincial capital of Jinan to call off 126 paper gold transactions between June 29 and July 8, 2006.

Bron Suchecki, over at The Perth Mint, sent me this story with the comment that "The Chinese might like physical gold, but it seems they also like leveraged paper gold as well." It was posted on the chinadaily.com.cn Internet site on June 29th...and the link is here.

Here's another must read GATA release, that contains an excellent preamble by Chris Powell. Powell's introduction...and Ben Davies presentation are linked here.

Expect shortages of precious metal coins worldwide should investment demand jump dramatically as a result of another financial crisis.

According to The Perth Mint’s Bron Suchecki, probably less that 2% of people started buying precious metals during the financial crisis in 2008. The result was rationing of coins by mints!

In a telephone interview with the Financial Survival Network, Bron questioned what would happen should serious, mass market demand like that seen at the end of the 1970s re-emerge.

Despite better preparedness among mints generally for this possibility, Bron told Kerry Lutz there remains a huge potential production bottleneck problem that investors would do well to be aware of.

This short must read story posted over at The Perth Mint earlier today, has the Suchecki/Lutz interview embedded in it...and the link is here. Bron also has a short blog on this issue that's worth your time as well.