Thoughts For The Day:

Even our school of economics and investors have become habituated to the social, political and financial calamity at hand. The outlaw financial leadership of the entire Western world has sold out our heritage on both sides of the pond.

Governments, states, municipalities, towns and hamlets are broke. Insurance companies, banks and major investment houses are valuing their assets from worth-less to worth-full.

The stampede to the bonus stock holder’s asset give away is clearly because this is the last dip at the well for a decade.

All paper money in the West is the common shares of the bankrupts.

Asia and Africa are rising and their ascension cannot be stopped. They have long term business plans and are working those plans to protect themselves from the multitudinous sins of the West and control world commerce.

Stand back for a moment, without emotion, and look at where we are.

Protect yourselves because no one else is going to do it.

Cling to money that has no liability attached to it, the only honest money, Gold.

 

Jim Sinclair’s Commentary

The State of Connecticut Unemployment Fund is bankrupt and is now borrowing from the Federal Government.

Click here to watch the video… ^[1]

 

Jim Sinclair’s Commentary

The right thing for the Euro is to shake off weak members. That would cause a short downer but long term it would be a major positive.

The likelihood of this being MOPE and negotiation is higher than anyone in this world doing the economically correct thing.

ECB prepares legal ground for euro rupture as Greek crisis escalates
Fears of a euro break-up have reached the point where the European Central Bank feels compelled to issue a legal analysis of what would happen if a country tried to leave monetary union.
By Ambrose Evans-Pritchard
Published: 5:12PM GMT 17 Jan 2010

“Recent developments have, perhaps, increased the risk of secession (however modestly), as well as the urgency of addressing it as a possible scenario,” said the document, entitled Withdrawal and expulsion from the EU and EMU: some reflections.

The author makes a string of vaulting, Jesuitical, and mischievous claims, as EU lawyers often do. Half a century of ever-closer union has created a “new legal order” that transcends a “largely obsolete concept of sovereignty” and imposes a “permanent limitation” on the states’ rights.

Those who suspect that European Court has the power pretensions of the Medieval Papacy will find plenty to validate their fears in this astonishing text.

Crucially, he argues that eurozone exit entails expulsion from the European Union as well. All EU members must take part in EMU (except Britain and Denmark, with opt-outs).

This is a warning shot for Greece, Portugal, Ireland and Spain. If they fail to marshal public support for draconian austerity, they risk being cast into Icelandic oblivion. Or for Greece, back into the clammy embrace of Asia Minor.

More… ^[2]

 

Jim Sinclair’s Commentary

The West looks towards China as China looks towards Africa.

China gives Tanzania US$180 mil. in loans: minister

DAR ES SALAAM — China gave Tanzania US$180 million in concessional loans on Friday as part of its pledge to provide US$10 billion in low-cost lending to Africa over the next three years, Tanzanian Finance Minister Mustafa Mkulo said on Saturday.

The agreement was unveiled during a visit to the Tanzanian commercial capital Dar es Salaam by Chinese Commerce Minister Chen Deming, who arrived on Thursday for a three-day tour of east Africa’s second largest economy.

China made the US$10 billion pledge — double the amount offered in 2006 — at a summit in Egypt in November as it aims to boost a relationship with the continent which goes back decades politically and is now booming economically.

Blossoming trade and business ties have attracted Western accusations that Beijing is solely interested in African resources and is ready to overlook poor governance.

Chinese commentators respond that envious Europeans still treat the continent like a colony.

More… ^[3]

 

Jim Sinclair’s Commentary

Airport security for those flying from Canada to the United States.

 

Jim Sinclair’s Commentary

You think Central Banks are a tad nervous about meetings at a known location on a specific date?

Could it be the answer lies in the Northern Lights? I understand the Penguins are going to protest, but the Arctic?

Arctic Outpost Gives Flaherty Chance to Heal G-7 Split on Banks
By Theophilos Argitis

Jan. 18 (Bloomberg) — U.S. Treasury Secretary Timothy F. Geithner, European Central Bank President Jean-Claude Trichet and their Group of Seven counterparts face few distractions when they meet in an Arctic outpost to rein in diverging policies on the future of bank regulation.

Canadian Finance Minister Jim Flaherty will host G-7 finance chiefs and central bankers Feb. 5-6 in Iqaluit, a town 195 miles south of the Arctic Circle. He says he’ll press for more unity after the U.S., U.K. and France imposed levies on banks or bonuses even after Group of 20 leaders in September promised to “raise standards together.”

“We’re trying to have a synchronized approach and clearly some jurisdictions are going in different directions,” Flaherty said in a Jan. 12 interview in Swift Current, Saskatchewan.

President Barack Obama announced plans this month for a tax on financial institutions to recoup losses from the Troubled Asset Relief Program and cut the deficit, a levy Flaherty has said Canada won’t impose.

The U.K. government, meanwhile, placed a 50 percent tax on bank-employee bonuses of more than 25,000 pounds ($40,400). France has also moved to impose a one-time tax. G-7 countries also differ on whether to tax financial transactions, with the U.K. and other European governments backing such a measure and the U.S. and Canada opposed.

More… ^[4]

 

Jim Sinclair’s Commentary

The dollar’s year-end rally was sold in 2009 based on a sustained economic recovery of merit.

The variable is the MOPE on the euro over Greece and the Japanese wild-card. The net result will be a lower dollar.

The basis of the 2009 year end dollar rally is losing it appeal almost daily.

AAR weekly report: U.S. railroads off to rocky start in 2010

After registering their lowest annual carload total since 1988, U.S. railroads got off to a very slow traffic start in 2010. During the year’s first full week ending Jan. 9, they originated 236,796 carloads, down 12.4 percent, and 196,788 intermodal loads, down 3.6 percent compared with figures from the same period last year, according to the Association of American Railroads. Total estimated volume of 25.5 billion ton-miles dropped 12.4 percent.

Coal remained a “significant laggard” to traffic volumes, according to Robert W. Baird & Co. Inc.’s weekly rail traffic report. But “recent cold weather will aid in working down electrical power plant inventories, which remain near historical highs,” the report states.

Meanwhile, Canadian and Mexican railroads started the year on a good note. Canadian roads’ week No. 1 carloads increased 20.4 percent to 67,333 units and intermodal volume rose 0.2 percent to 43,033 units, while Mexican roads’ carloads jumped 32.1 percent to 12,123 units and intermodal loads soared 44.4 percent to 5,722 units.

However, U.S. and Canadian regionals and short lines continued to struggle after a trying 2009. During the week ending Jan. 9, 336 small railroads handled 82,306 carloads, down 9.3 percent year over year, according to RMI’s RailConnect Index of Short Line Traffic. Coal carloads tumbled 35 percent to 9,651 units while intermodal loads plunged 33.4 percent to 5,256 units.

More… ^[5]

 

Jim Sinclair’s Commentary

How about the US building a meaningful strategic metals and materials stockpile?

China completes 1st phase of Nat’l strategic oil reserve project
Power & Materials    1/18/2010 7:22:00 PM

(With Photo) TOKYO, Jan 18 (KUNA) — China has completed the first phase of the national strategic oil reserve project with the average cost of USD 58 per barrel in 2009, the state-run China Daily reported Monday.

China inked loan-for-oil deals worth over USD 60 billion with Russia, Brazil and Venezuela last year, securing a crude oil supply of 75 million tons annually (1.51 million barrels a day (bpd)), the report quoted Zhang Guobao, head of the National Administration of Energy (NEA) as saying.

The NEA is the nation’s top level administration oversees the energy sector.

The amount is equivalent to 42 percent of China’s crude oil import in 2008, the daily said.

China is the world’s second-biggest oil importer after the US. It imported record 21.3 million tons (5.03 million bpd) last December and imports in 2009 hit 204 million tons (4.10 million bpd), customs data showed.

Imported crude oil accounted for 52 percent of China’s total oil consumption last year, while the nation produced about 190 million tons (3.82 million bpd) of oil in 2009, maintaining downward trend, the daily said.

More… ^[6]

 

Jim Sinclair’s Commentary

You are either stupid or insane, you can’t be both at the same time. However, either Kuwait or Israel could make a miscalculation.

Kuwaiti FM: Israel’s Prime Minister Is “Stupid and Insane”
Published: January 17, 2010

Kuwait’s foreign minister lashed out at Israeli Prime Minister Benjamin Netanyahu, calling him “stupid” and “insane,” the Palestinian news agency Ma’an reported on Sunday.

Mohammed al-Sabah said the policies of “Israel’s stupid and insane prime minister” had jeopardized the so-called peace process, but that the Kuwaiti government remained committed to an Arab peace plan put forward by Saudi Arabia and would keep working to heal a split between the major Palestinian factions, Fatah and Hamas.

Palestinian President Mahmoud Abbas and exiled Hamas chief Khaled Meshal were set to meet in the next 10 days, al-Sabah said. “Abbas and Meshal will aim at completing the reconciliation proposal backed by Egypt,” Ma’an reported him as saying, quoting the Kuwaiti press.

All attempts to broker a compromise between the warring blocs have failed since mid-2007. But Meshal hinted on Sunday that the rivals could now be close to a deal, saying that reconciliation talks were in the “final stages,” Ma’an reported.

More… ^[7]

 

Jim Sinclair’s Commentary

Air and ground forces crossing a border used to be called an invasion.

Israeli army crosses into Lebanon: state media
2010-01-18 04:39:41

BEIRUT, Jan. 17 (Xinhua) — An Israeli army unit on Sunday crossed the borders with Lebanon in the direction of the occupied part of al-Ghajar village, Lebanon’s state-run National News Agency (NNA) reported.

“An intense Israeli build-up of forces during the past 24 hours has been observed along the eastern sector of the Blue Line, with mobile and fixed patrols,” said NNA.

It added that “Israeli tank emplacements were spotted amid intense overflights by helicopter gunships and warplanes.”

“Earlier, an Israeli mechanized infantry unit comprised of two Hummers crossed the UN-designated Blue Line for 300 meters in the direction of the occupied part of al-Ghajar village,” said NNA.

On the Lebanese side, UN Interim Force in Lebanon (UNIFIL) and Lebanese army personnel intensified patrolling activities.

The Blue Line, which is the line for Israeli withdrawal from south Lebanon in 2000, now serves as the borderline of the two countries and runs through the middle of the al-Ghajar village.

More… ^[8]

 

Jim Sinclair’s Commentary

A little push here, a little shove there, a miscalculation and off we go.

Four Israeli jets seen over Lebanon
Military and Security    1/17/2010 9:02:00 PM

BEIRUT, Jan 17 (KUNA) — Four Israeli fighter jets were seen flying over Lebanese airspace in violation of the Lebanese sovereignty and UN resolution 1701, a Lebanese statement said on Sunday.

The fighters were seen over a town south of Lebanon located close to the border with Israel, according to a statement by the Lebanese armed forces.

The planes made a circular movement over several towns before heading back over the sea.

The statement added that Israeli fighters have been witnessed over Lebanese territory on a virtually daily basis for a few weeks lately, and this is considered a breach of the UN Security Council resolution 1701.

The UN Interim Forces in Lebanon (UNIFIL) have voiced concern over the matter on a number of occasions, criticizing the Israeli breaches on Lebanese sovereignty, and sending letters of complaint to the UN and Israeli army command. (end) ayb.sd KUNA 172102 Jan 10NNNN

More… ^[9]

Jim Sinclair’s Commentary

Turkey continues to get into areas of harm’s way geopolitically.

Israel, Turkey and Low Seats
January 18, 2010
By George Friedman

Last week a small crisis with potentially serious implications blew up between Israel and Turkey. Israeli Deputy Foreign Minister Danny Ayalon summoned Turkish Ambassador to Israel Ahmet Oguz Celikkol to a meeting Jan. 11 to protest a Turkish soap opera that depicted Israeli agents kidnapping Palestinian children. When the ambassador arrived, he received a lower seat than Ayalon — and was photographed in that position, making it appear that Ayalon was speaking to an inferior. Ayalon wouldn’t shake hands with him during the televised parts of the meeting, and had an Israeli flag visible on the table. Topping it all off, Ayalon told an Israeli cameraman in Hebrew that the important thing was that people see Celikkol sitting down low “while we’re up high.”

Turks saw the images as a deliberate Israeli insult, though Ayalon argued that the episode was not meant as an insult but as a reminder that Israel does not take criticism lightly. While it is difficult to see the relative height of seats as an international incident, Ayalon clearly intended to send a significant statement to Turkey. The Turks took that statement to heart, so symbolism clearly matters. Israel’s intent is not so clear, however.

Turkey and Israeli National Security

Over the past year, Turkey has become increasingly critical of Israel’s relations with the Arab world. Turkey has tried to mediate, for example, between Syria and Israel. Now, Turkey has made it known that it holds Israel responsible for these failures. Even so, Turkey remains Israel’s major ally, albeit informally, in the Muslim world. Turkey is also a growing power. Uniquely in the region, it provides Israel with a dynamic economy to collaborate with. Turkey also has the most substantial and capable military force in the region. Should Turkey shift its stance to a pro-Arab, anti-Israel position, the consequences for Israel’s long-term national security would not be trivial.

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