Jim Sinclair’s Commentary

This entire destruction is a product of our dear friends, the OTC derivative manufacturers and distributors.

We are getting the destruction reports piece by piece.

Piece by piece it will all be bailed out.

Hyperinflation as the major consequence cannot be avoided by any means short of Divine.

Those financially in charge are the antithesis of Divine.

Are you ready?

45 percent of world’s wealth destroyed: Blackstone CEO
Wed Mar 11, 2009 3:10am EDT
By Megan Davies and Walden Siew

NEW YORK (Reuters) – Private equity company Blackstone Group LP (BX.N) CEO Stephen Schwarzman said on Tuesday that up to 45 percent of the world’s wealth has been destroyed by the global credit crisis.

"Between 40 and 45 percent of the world’s wealth has been destroyed in little less than a year and a half," Schwarzman told an audience at the Japan Society. "This is absolutely unprecedented in our lifetime."

But the U.S. government is committed to the preservation of financial institutions, he said, and will do whatever it takes to restart the economy.

U.S. Treasury Secretary Timothy Geithner plans to unfreeze credit markets through a new program that will combine public and private capital in a fund that would buy bank toxic assets of up to $1 trillion.

"In all likelihood, that will have the private sector buy troubled assets to clean the banks out in terms of providing leverage … so that we can get more money back into the banking system," Schwarzman said.

More… ^[1]

Jim Sinclair’s Commentary

Since US Treasury instruments carry the full faith and implicit guarantee by the US government, what is China saying here? Do they want gold as a guarantee as the only other guarantee might be a mortgage on the White House.

Whenever a statement is issued by a high placed representative in China it is serious and well considered. It is not an offhand remark.

It sounds like "keep the G20 off our currency or we will hammer you!"

Jiabao ‘Worried’ About Safety of U.S. Investments, Wen Says
By Eugene Tang

March 13 (Bloomberg) — China wants the U.S. government to “ensure the safety” of its investments in the world’s largest economy, Premier Wen Jiabao said.

“We have lent a huge amount of money to the United States,” Wen said today at a press conference in Beijing that marked the closure of the annual National People’s Congress meeting. “Of course we are concerned about the safety of our assets. To be honest, I am a little bit worried.”

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Jim Sinclair’s Commentary

This is starting to mirror the 1970s. I told you it would happen!

Banks were January net buyers of 1.1 million oz of gold: CPM
New York (Platts)–10Mar2009

Central banks, which have been net sellers of gold in recent years, were net buyers of an estimated 1.1 million oz in January, according to the latest Market Alert by the CPM Group, the New York-based metals consultancy. The world’s central banks were both buyers and sellers, but the quantity bought outstripped what was sold.

Ecuador is estimated to have purchased 920,000 oz of gold in January, Venezuela bought 240,000 oz and Russia purchased 130,000 oz, after having bought 310,000 oz in December.

"Ecuador’s government has run into severe political and economic problems, and has a dollarized economy, using the US dollar as its currency and thus not having many monetary tools, such as being able to issue money that other central banks possess," CPM noted. France was the largest seller of gold in January by 40,000 oz and 10,000 oz, respectively.

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What is an Earmark?

Earmarks are funds provided by the Congress for projects or programs where the congressional direction (in bill or report language) circumvents the merit-based or competitive allocation process, or specifies the location or recipient, or otherwise curtails the ability of the Executive Branch to properly manage funds. Congress includes earmarks in appropriation bills – the annual spending bills that Congress enacts to allocate discretionary spending – and also in authorization bills.

http://earmarks.omb.gov/ ^[4]

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My Dear Friends,

What do you wish your estate to look like, a bag of paper or gold?

Gold is going to $1224 and $1650 on its way to Alf’s numbers.

I made my decision and it was carried in the Forbes article of 2001 found here. ^[6]

I have not changed one cubit from 2001 – I have only added to it. I challenge anyone out there to do better trading.

Success comes from making a plan and working a plan within a bull market. Failure comes from the egomania that says you, the newbie, can out trade the seasoned pro of 25 years or more. This is total and complete madness.

As the song the Gambler sings goes, the best you can hope for is the break even. Listen to the Gambler and learn a great lesson.

Today the US dollar declared its intention of retesting and failing at .7200

Regards,
Jim

Jim Sinclair’s Commentary

You know this is a product of the many Fed dollar swaps done to camouflage the bailout of non US banks in Switzerland and elsewhere. That is why those that predict the imminent collapse of Switzerland are smoking something.

Today’s action in the Swiss franc could have been a gift from the Swiss national bank to the massive shorts in the non-euro European currency raid that has taken place as another price for the Fed bailing out UBS and many others.

I have seen this kind of game played before. What a world we live in.

I would say if you have not cheated uncle, you need not worry. Remember my advice to play straight.

Liechtenstein eases bank secrecy amid crackdown
Thu Mar 12, 2009 8:34am EDT
By Jason Rhodes

VADUZ, Liechtenstein, March 12 (Reuters) – Liechtenstein agreed to ease its strict bank secrecy by committing to international tax and data standards, increasing pressure for similar concessions from other tax havens.

The move comes as finance ministers from the G20 group of rich nations and emerging powers prepare to meet in Britain from Friday ahead of a summit in London on April 2 that is expected to seek ways to fight tax evasion through offshore centres.

The tiny principality, a financial centre wedged between Switzerland and Austria, is seeking to be removed from a blacklist of tax havens and will now offer bilateral tax deals for cooperating in cases of tax fraud and tax evasion.

"Today’s declaration was very important in the run-up to the G20 meeting, so that Liechtenstein’s strategy is recognised," Prime Minister Otmar Hasler told a news conference.

Liechtenstein, whose banks have suffered big withdrawals since Germany launched a probe last year into 1,000 citizens suspected of dodging tax by parking money there, said its move could serve as an example to other nations under pressure.

More… ^[7]

Jim Sinclair’s Commentary

Defuse Pakistan? You have to be kidding!

That is the same as trying to make Mullah Omar a Christian. Impossible and stupid.

US and British diplomats scramble to defuse Pakistan crisis
Zahid Hussain in Islamabad and Jeremy Page in Lahore

US and British diplomats were scrambling to broker a truce between Pakistan’s feuding political leaders tonight as thousands of black-suited lawyers defied a government ban to launch a mass protest across the country.

Richard Holbrooke, the new US special envoy for Pakistan and Afghanistan, telephoned Asif Ali Zardari, Pakistan’s President, to discuss the unrest, which has raised fears that the army could take power once again.

“Mr Holbrooke conveyed the anxiety of the US Administration over the worsening political crisis and asked the president to find ways to end the strife,” a senior Pakistani official told The Times.

David Miliband, the Foreign Secretary, also spoke to Mr Zardari as lawyers and opposition activists clashed with police at the start of a “long march” from major cities towards Islamabad, the capital. Organisers hope that hundreds of thousands will join the march, due to end with a rally in front of the national parliament on Monday, to demand that the government reinstate judges deposed under Pervez Musharraf, the former president.

Nawaz Sharif, the former Prime Minister whose party quit the government last year over the same issue, has urged Pakistanis to join the march and to rise up against their weak civilian government.

More… ^[8]

Jim Sinclair’s Commentary

This the end of the beginning and now the plot is the beginning of the end of the present Pakistan government.

The buggers (present Paki government) were suckered into doing just what they should not have done.

Pakistan police swarm into major anti-government demonstration
By Mark Magnier 
11:56 AM PDT, March 12, 2009

Reporting from Islamabad, Pakistan — Police overwhelmed anti-government protesters today in Karachi, Pakistan’s largest city, arresting opposition leaders and preventing several hundred lawyers and activists from leaving for a planned demonstration in Islamabad.

Over the past 24 hours, the government of President Asif Ali Zardari has detained hundreds of people critical of its policies, arguing that public gatherings could serve as a focal point for terrorists and otherwise endanger property and lives.

Authorities also banned public assembly in two key provinces and blocked major roads leading into Islamabad, the capital, with barriers and paramilitary vehicles.

"The government has resorted to raiding the houses of the leaders of political parties," said Farooq Tariq, an official with the Pakistan Labor Party. "I’ve been underground for the last three days."

Lawyers were at the forefront of demonstrations against the former government of President Pervez Musharraf, who incurred their wrath in part by firing dozens of senior judges in 2007 in an apparent bid to head off legal challenges to his rule. The attorneys have continued to press Zardari to reinstate key judges.

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Hundreds seized as panicky Asif Ali Zardari struggles to keep grip on power
March 12, 2009

Pakistan rounded up hundreds of lawyers, activists and political opponents yesterday before protests that threatened to loosen the Government’s increasingly shaky grip on power.

Raja Zafarul Haq, a senior opposition leader, was placed under house arrest and police were hunting for Imran Khan, the former cricketer-turned-politician, after he escaped a police raid on his house in the middle of the night.

Clashes broke out in many cities in the eastern province of Punjab, where protesters took to the streets defying the government ban on public gatherings.

The crackdown, the most severe since the US-allied Government came to power a year ago, will damage the democratic credentials of President Zardari further. His administration is already rocking from a growing Islamic insurgency that culminated last week in a deadly attack on the touring Sri Lanka cricket team. The army, which has repeatedly seized power in Pakistan from civilan governments, was placed on high alert as tension mounted. Most of those detained belonged to the opposition Pakistan Muslim League (N) led by Nawaz Sharif, the former Prime Minister, and Imran Khan’s Tehreek-e-Insaf. Scores of others who evaded the morning raids have gone into hiding.

Police and paramilitary troops sealed off the capital, Islamabad, where opposition parties and lawyers planned to stage a sit-in outside the parliament building.

“My house was raided at 3 in the morning but I managed to escape,” Imran Khan told The Times on the telephone.

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Jim Sinclair’s Commentary

The following is from JB Slear, famous to us and infamous to our evil Comex brothers.

Pretending to be a Mutual Fund manager after losing ¾’s of their clients liquidity, or just a princess. Your pick

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Jim Sinclair’s Commentary

OTC derivative plus the market is the correct reason.

Note the underfunded amount. This also does not include January 1 to present!

I would make a guess they would be $400 to 500 billion down if accounted for today.

Largest U.S. pension plans’ assets fall $217 billion short
By Sandra Block and Sue Kirchhoff, USA TODAY

Last year’s stock market collapse left the nation’s largest private pension plans with a deficit of more than $200 billion, a study released Wednesday said, which could force companies to invest more money in their plans when they can least afford it.

The nation’s 100 largest corporate pension plans were underfunded by $217 billion at the end of 2008, holding only 79% of the assets needed to cover estimated long-term liabilities. That compares with an $86 billion surplus — 109% of estimated liabilities — at the end of 2007, according to Watson Wyatt, a human resources consulting firm.

Pension plans’ assets fell 26% last year, primarily because of investment losses, the study said. A separate study released Wednesday by Milliman said the nation’s largest plans lost an additional $54 billion in February.

It’s not unusual for companies to have underfunded pension plans, and the deficit typically doesn’t affect payouts to near-term retirees. But to avoid future problems, companies with underfunded pensions are required to increase contributions.

Companies are also facing stricter federal funding requirements for pensions, says David Speier, senior retirement consultant at Watson Wyatt. "This combination will require employers to make staggering pension contributions over the next couple of years, at a time when they can least afford them."

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JB Slear’s Commentary

That’s it!! Time to protest in the streets.

Chocolate tax call in obesity fight

Chocolate should be taxed in a bid to control the obesity epidemic, a medical conference will hear.

A doctor called to tax chocolate to fight obesity

Family doctor David Walker believes that chocolate is a "major player" in the problem of the country’s expanding waistlines.

Taxing the treat would raise its profile as an unhealthy food which can contribute to weight-related conditions including diabetes, high blood pressure and back pain, the Lanarkshire GP will tell doctors at a conference in Clydebank.

He said people are often eating more than half a day’s worth of calories when they polish off a bag of chocolates in front of the television.

Dr Walker, based at Airdrie Health Centre, said: "I believe that chocolate is a major player in obesity and obesity-related conditions.

"What I’m trying to get across is that chocolate is sneaking under the radar of unhealthy foods.

"More than one person has said to me, ‘oh, but isn’t chocolate good for you?’ but any benefits are more than outweighed by the detrimental effect of obesity.

More… ^[13]

 

Jim Sinclair’s Commentary

I am appalled that a major source of World Economic data can just adopt a new computer model and no one questions it.

The following, as I have told you, was what the Bank for International Settlement stated prior to adopting a new computer model to reduce it by 50%.

Where is the outrage? Nowhere I imagine in a world populated by sheep.

Global Derivatives Market Now Valued at $1.14 Quadrillion!
By: Jutia Group   Thursday, July 24, 2008 1:40 PM

The Bank of International Settlements, which seems to be the only institution that tracks the derivatives market, has recently reported that global outstanding derivatives have reached 1.14 quadrillion dollars: $548 Trillion in listed credit derivatives plus $596 trillion in notional/OTC derivatives.

Yes, that is Quadrillion. One and 15 zeroes!

More… ^[14]

 

Jim Sinclair’s Commentary

This (corporate losses of the too big to fail) is not ending. Bailouts (every dime and more) are not ending.

Therefore the prediction by the Super Bears of a further implosion in business activity after a dead cat bounce guarantees hyperinflation and gold at Alf’s levels.

Take that you mal-informed deflationists that do not know the definition of deflation.

Freddie Mac reports massive loss

US mortgage giant Freddie Mac has revealed a loss of $50.1bn (£36.1bn) for 2008, and said it plans to ask the government for another $31bn of aid.

The company had already received $13.8bn in federal aid last year.

Freddie said the last quarter had been particularly bad, reporting a loss of $23.9bn for the three months to the end of December.

Last month, fellow mortgage company Fannie Mae reported an annual loss of nearly $59bn due to the housing crisis.

It also said it needed $15.2bn in government aid.

The huge losses made by the companies led to the government bailout.

More… ^[15]

Jim Sinclair’s Commentary

The Whopper Award of the century goes to Alan Greenspan

Greenspan again finds the Fed blameless in housing bubble
10:35 PM, March 11, 2009

Alan Greenspan just cannot bring himself to say, "I’m sorry."

The former Federal Reserve chairman wrote an op-ed piece for the Wall Street Journal on Wednesday that repeated his favorite refrain: The Fed’s easy-money stance of 2002-2004 didn’t cause the housing bubble.

It wasn’t the rock-bottom short-term interest rates of that period, as dictated by Fed policy, that fueled the housing mania, Greenspan says.

Rather, he blames "the decline in long-term interest rates across a wide spectrum of countries" from 2000 through 2005.

Long-term interest rates, Greenspan wrote, became "disconnected" from Fed policy in that period as rising wealth in China and other foreign countries was plowed into Treasury bonds and other long-term fixed-income securities — pushing long-term rates down, including on 30-year mortgages.

In other words, the housing bubble was "all the fault of those pesky foreigners," says Ian Shepherdson, chief U.S. economist at High Frequency Economics in Valhalla, N.Y.

More… ^[16]