Dear CIGAs,
For your information, there is an Angel at $1156 that has been putting up a great fight in the last two sessions.
Jim Sinclair’s Commentary
If rates rise, the make believe (MOPE) recovery will collapse, period!
Elusive and fragile recovery threatened by soaring deficit
Business leaders warn of potential economic relapse as Chancellor prepares report
By Sean O’Grady, Economics Editor
Monday, 7 December 2009
As the Chancellor adds the final polish to his pre-Budget report on Wednesday, some of Britain’s leading business organisations have warned that the recovery will be fragile and that soaring public borrowing threatens the UK’s international credit rating. Britain runs a high risk of a "relapse" into recession next year.
The Engineering Employers’ Federation says that conditions in the British manufacturing sector have continued to improve, but that signs for a strong rebound in 2010 "remain elusive."
While the EEF say that "the worst of the downturn is behind the sector and the weak pound and recovering world markets are beginning to have a positive impact", confidence across manufacturing remains fragile.
The EEF also warned that given the experience of previous recessions when investment took some three to four years to recover, the steep cutbacks seen during the current downturn present a significant threat to industry’s longer term competitiveness.
Yesterday, the British Chambers of Commerce became the latest group to call on the Treasury to set out a credible plan to tackle the structural deficit, which they estimate at £90bn per year – that is the borrowing that will still be needed to keep up with public spending even if the economy recovers some of its old vigour. However, the BCC also stressed that addressing the deficit had to be done gradually.
Jim Sinclair’s Commentary
Turkey today.
Turkey says no more troops for Afghanistan
Reuters
Sunday, December 6, 2009; 7:49 AM
ISTANBUL (Reuters) – Turkish Prime Minister Tayyip Erdogan, who left for the United States on Sunday to meet President Barack Obama, said Turkey would not contribute additional troops to Afghanistan.
Erdogan’s trip comes at a time when Turkey’s deepening ties with fellow Muslim countries has fed perceptions that the NATO member is turning away from its traditional western allies.
Obama last week announced he was sending 30,000 more U.S. soldiers to Afghanistan, and Washington wants others to follow suit. "Turkey has already done what it can do by boosting its contingent of soldiers there to 1,750 from around 700 without being asked," said Erdogan before his departure in Istanbul.
Turkey’s soldiers are not engaged in combat operations and Ankara has long resisted pressure from Washington to offer more combat troops.
Erdogan said Turkey would continue its training of Afghan security forces.
The prime minister also said he would discuss other regional issues such as Iraq and the Middle East with the U.S. president.
Jim Sinclair’s Commentary
Maybe F-TV got ahead of itself.
It appears as if the Chairman is not buying it. He should not as we all know the headwinds are still fierce.
Bernanke Sees ‘Formidable Headwinds’ for U.S. Economy
By Craig Torres and Shobhana Chandra
Dec. 7 (Bloomberg) — Federal Reserve Chairman Ben S. Bernanke said the U.S. economy faces “formidable headwinds,” including a weak labor market and tight credit that are likely to produce a “moderate” pace of expansion.
“The economy confronts some formidable headwinds that seem likely to keep the pace of expansion moderate,” Bernanke, 55, said today in a speech to the Economic Club of Washington. He said inflation remains “subdued” and might even move lower.
Treasuries advanced as traders pared bets the central bank will increase interest rates before August. Bernanke, in response to a question after his speech, repeated the Fed’s statement that rates are likely to remain low for an “extended period.”
The yield on the benchmark two-year Treasury note fell seven basis points to 0.76 percent at 3:35 p.m. in New York. The Standard & Poor’s 500 Index was down 0.2 percent to 1,103.92 after rising as much as 0.4 percent.
“Bernanke suspects we will grow below normal recovery standards, and that pace could be around awhile,” said Gregory Miller, chief economist at SunTrust Banks Inc. in Atlanta. “Fed policy may stay where it is, essentially zero, for some time. There are serious risks out there.”
Jim Sinclair’s Commentary
These guys will not stop manufacturing financial WMDs until they are in the ground.
BIS sounds risk alarm.
The Bank for International Settlements stated in its latest quarterly report, published over the weekend, that banks may once again be lured to take big risks because of rock-bottom interest rates. The study found evidence of a significant link between an extended period of low interest rates prior to the financial crisis and banks’ risk-taking, which it said could consequently fuel new asset price bubbles. BIS also noted the volume of international debt securities issued in Q3 fell 16% from Q2, to $1.998T while net issuance almost halved to $475B. Total turnover in exchange-traded derivatives was stable at $425T, which is about 60% of the volume seen before the financial crisis
Jim Sinclair’s Commentary
Pakistan today.
Peshawar huge blast kills 10, injures 45
Mon, 07 Dec 2009 10:55:16 GMT
At least 10 people have been killed and 45 others wounded in a blast outside a court building in Pakistan’s northwest city of Peshawar.
The explosion occurred Monday following recent attacks in Peshawar that lies on the edge of Pakistan’s lawless tribal belt.
Dr. Jamil Ahmad at the city’s Lady Reading Hospital said at least 10 people were killed, including two policemen, adding that 45 others were wounded.
Security and government facilities are main targets of militants. On November 19, an explosion killed 19 people outside another judicial complex in Peshawar.
Earlier on Saturday, an explosion in Peshawar left four people dead.
Hundreds have lost their lives in a series of terrorist attacks in Pakistan beginning in October when the Pakistani army launched an offensive against pro-Taliban militants in the northwest.
Jim Sinclair’s Commentary
Can you recall that three years ago when Pakistan was no story?
Soon Turkey will be on the geopolitical risk map.
Opinion: Explaining Turkey’s high-risk activism
Turkey’s search for its own path is accompanied by significant risks.
By Ronald H. Linden — Special to GlobalPost
Published: December 7, 2009 11:17 ET
Updated: December 7, 2009 14:37 ET
WASHINGTON — On Monday, Prime Minister Recip Erdogan of Turkey arrived in Washington trailing a list of actions designed to achieve “zero problems” with his country’s neighbors. Considering how many immediate neighbors there are (seven) and who they are (e.g. Iran, Iraq, Syria, Armenia) this is a tall order. Ankara’s activism has raised the stakes in its own neighborhood and eyebrows in the United States.
Turkey has long been a valuable member of NATO and supporter of U.S. initiatives, e.g. the first Gulf War, Afghanistan. Its application to join the EU has been in Brussels’ mailbox for more than 20 years. Now, several developments in the region — an erosion of U.S. interest and power, the rise of an assertive Russia and Iran, a nonexistent “peace process” in the Middle East and the emergence of the Black Sea as a central energy corridor — have spurred Turkey to carve out its own distinctive role.
Turkey is poor in energy resources but rich in strategic location. Russia is now its largest trading partner and energy supplier. Ankara has agreed to let the Russians build the “South Stream” pipeline across Turkish territorial waters. Last year Turkish reaction to Russian dismemberment of Georgia — with whom Turkey had extensive ties — was muted and U.S. attempts to put more naval forces in the Black Sea at the time were rebuffed. When the foreign minister visited Georgia, a deputy undersecretary simultaneously visited the breakaway Abkhazia region.
But it would be misleading to see this as an East-West choice. Turkey has not retreated from involvement in European energy plans and signed the long-delayed agreement on the Nabucco Pipeline the same month as that on South Stream. It rapidly recognized the new state of Kosovo, which the EU and U.S. wanted and Russia did not. President Obama’s visit in April, 2009 produced a jump in favorable views of the U.S. but suspicions linger from years of being other countries’ instrument.
Jim Sinclair’s Commentary
Our allies in the war.
Pakistan court studies amnesty deal
Pakistan’s Supreme Court has begun a hearing on an amnesty deal that has shielded the country’s president and many other senior officials from corruption charges.
A 17-member panel stated hearing the petitions against the amnesty on Monday, Azhar Hussain, a court official, said, without giving further details.
The process could pave the way for challenges to the rule of Asif Ali Zardari, the president.
The amnesty deal, known as the National Reconciliation Ordinance (NRO), was announced two years ago by Pervez Musharraf, then the country’s president.
Jim Sinclair’s Commentary
I think China is playing to a cagey and is going get front run again.
Russia’s central bank eyes more gold
2009-12-07 16:20:00
MOSCOW (Commodity Online): Russia’s Central Bank picked up the pace of gold purchases in November, diversifying reserves as a weaker dollar boosts the appeal of bullion. And, it has announced that Russia may buy more gold in the coming days.
Russia’s gold reserve probably rose by $790 million to $23.1 billion in the week ended November 27. The Central Bank increased gold holdings by almost 130 tonnes in the last year. The bank’s holdings equaled $23 billion on December 1, a gain of 13 per cent in the month.
Russia plans to increase gold holdings and diversify the structure of its reserves, seeking alternatives to a weakening dollar.
That development worries some people: Since central banks typically buy US dollars to store their foreign exchange reserves, the growing taste for gold can be seen as the latest sign that the greenback’s status as the world’s sole reserve currency is in jeopardy.
The yellow metal has been on a tear since the end of August, but the rally gained added momentum starting on November 4, the day after the Reserve Bank of India announced that it had bought 200 tonnes of gold from the International Monetary Fund in October.
