Jim Sinclair’s Commentary
The latest on gold backing.
Buba opposes backing EMF with gold
Sun Mar 14, 2010 3:17pm GMT
BERLIN (Reuters) – Germany’s Bundesbank would oppose any government initiative to use its gold reserves as backing for a European Monetary Fund (EMF), a spokeswoman said.
German magazine Focus reported on Saturday that the finance ministry was considering the possibility of euro zone countries using their central banks’ gold reserves to back an EMF.
Jim Sinclair’s Commentary
The fox would be in charge of the hen house.
This is plausible denial for the legislative for not regulating or eliminating OTC derivatives.
Senators’ plan would put derivatives under the Federal Reserve
By Silla Brush – 03/11/10 08:22 PM ET
Senators are considering giving the Federal Reserve power to regulate clearinghouses for derivatives in a wide-ranging financial overhaul bill.
Sens. Jack Reed (D-R.I.) and Judd Gregg (R-N.H.) have been deep in negotiations on how to impose new restrictions on the opaque and multitrillion-dollar market for derivatives that many blame for exacerbating the financial crisis.
regg has been considering ways to give the central bank more authority over clearinghouses, the third-party entities that settle derivatives transactions.
“It is important that the Federal Reserve be involved in the risk management, oversight and regulation of clearinghouses,” Gregg said in a statement to The Hill.
The House passed legislation in December giving the bulk of the authority to the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC).
Jim Sinclair’s Commentary
If you think the hide-a-debt OTC derivative swap was only used by Greece, I will sell you a bridge in New York for cheap.
British law firm ‘conspired’ to hide $50bn debts of Wall St giant
By Lucy Farndon
Last updated at 3:20 PM on 13th March 2010
A top British law firm helped stricken banking giant Lehman Brothers hide its debts in the run-up to the bank’s collapse, a report said yesterday.
Linklaters, one of the City’s ‘magic circle’ law practices, signed off questionable accounting techniques to disguise $50billion (£36billion) debts.
The 2,200-page report, published yesterday in America, found that Linklaters allowed ‘balance sheet manipulation’ while investors remained in the dark as to what was going on.
Crucially, Lehman had turned to the UK after it failed to find an American law firm who would sign off the activities, the report said.
Linklaters advised Lehman that the accounting practice was allowed under English law.
The report was produced by U.S lawyer Anton Valukas, who was appointed by a judge to investigate the collapse of Lehman Brothers in September 2008.
Jim Sinclair’s Commentary
The well is dry. Somebody had their hand in the cookie jar.
Social Security to start cashing Uncle Sam’s IOUs
By STEPHEN OHLEMACHER (AP)
PARKERSBURG, W.Va. — The retirement nest egg of an entire generation is stashed away in this small town along the Ohio River: $2.5 trillion in IOUs from the federal government, payable to the Social Security Administration.
It’s time to start cashing them in.
For more than two decades, Social Security collected more money in payroll taxes than it paid out in benefits — billions more each year.
Not anymore. This year, for the first time since the 1980s, when Congress last overhauled Social Security, the retirement program is projected to pay out more in benefits than it collects in taxes — nearly $29 billion more.
Sounds like a good time to start tapping the nest egg. Too bad the federal government already spent that money over the years on other programs, preferring to borrow from Social Security rather than foreign creditors. In return, the Treasury Department issued a stack of IOUs — in the form of Treasury bonds — which are kept in a nondescript office building just down the street from Parkersburg’s municipal offices.
Jim Sinclair’s Commentary
Wherever and whatever, the connected are bailed out.
Dubai Shares Rise Most Since December on State-Guarantee Hopes
Dana El Baltaji
March 14 (Bloomberg) — Dubai’s benchmark stock index climbed the most in three months, leading gains in Gulf markets, on bets the government will back Dubai World after an official said the government is “always behind” the company.
Shuaa Capital PSC, the biggest investment bank in the United Arab Emirates, andDubai Financial Market PJSC, the only publicly traded Gulf Arab stock market, jumped the most in three months. Dubai Investments PJSC, the owner of stakes in more than 40 companies, climbed to the highest since January. The Dubai Financial Market General Indexadvanced 3.7 percent, the most since Dec. 14, to 1,746.6.
The government is “always behind” Dubai World and is separating “the bad business from the good business,” Sheikh Ahmed Bin Saeed al-Maktoum, chairman of Dubai Supreme Fiscal Committee, said in New Delhi on March 12. Some investors are interpreting those comments as a sign that Dubai’s troubles may be subsiding, said Tarek Zohny, a Dubai-based trader at EFG- Hermes Holding SAE.
“One of the messages investors wanted to hear and got last week was that there’s a possibility of a government guarantee,” Zohny said.
Dubai World, which is restructuring $26 billion in debt, will ask banks for permission to delay loan repayments when it presents a plan this month, said three bankers familiar with the negotiations on March 8. The company will present a restructuring proposal to creditors after its advisers finish valuing company assets, a person close to the Dubai government said Feb. 17.
Jim Sinclair’s Commentary
Cool your tubes. This is not a gold sale but rather the first move towards what I have been telling you for years.
This is the FRGCR tied to a measure of Western world M3.
Germany considers c.bank gold reserves for EMF-paper
BERLIN, March 13 (Reuters) – Germany is considering the possibility of euro zone countries using their central banks’ gold reserves to back a European Monetary Fund, German magazine Focus reported on Saturday.
The German Finance Ministry declined to comment on the report by Focus, which did not specify its sources.
"A proposal from the finance ministry suggests pooling the gold reserves of the former central banks of euro zone countries in a stabilisation fund," Focus wrote.
According to Focus, Greece still has around 112 tonnes of gold, while the German Bundesbank has 3,407 tonnes with a market value of around 90 billion euros.
German Finance Minister Wolfgang Schaeuble on Friday repeated his call for a fund which could, as a last resort, offer help to euro zone states facing bankruptcy.
Greece is battling a debt crisis and EU policymakers have been debating ways of providing support for it and other troubled euro zone members. (Reporting by Stefanie Huber, Writing by Sarah Marsh; editing by Patrick Graham)
Jim Sinclair’s Commentary
Washington must be in total denial about economics or who China is now.
This is diplomacy at its worst.
UK threatens China with isolation over Iran
Fri, 12 Mar 2010 18:58:48 GMT
The UK’s ambassador to Beijing has warned that China could face isolation internationally, should it fail to give its consent to fresh sanctions against Iran.
“It’s not in China’s interests to find itself isolated from permanent members of the Security Council or the E3+3. It would damage China internationally,” Sebastian Wood said on Friday.
Wood said that China favored a different approach to the Iranian nuclear issue but he hoped that “fluid” talks would persuade Beijing to accompany others in imposing more sanctions against Iran.
“China has emphasized a need for engagement and diplomacy and wants to see the situation resolved soon. We have seen tactical differences in recent weeks but it’s a fluid discussion,” he added.
The US has been lobbying for fresh punitive measures against Iran, which is already under three rounds of United Nations Security Council (UNSC) sanctions over its enrichment program.
Jim Sinclair’s Commentary
Try offloading a problem on the Chinese. They learned from their Bear Stearns experience.
China answers with demands the US protect their Treasury inventory.
China rejects US demand to boost yuan’s value
Sun, 14 Mar 2010 10:52:56 GMT
Chinese Prime Minister Wen Jiabao has rejected pressure by the US and a number of other nations for a faster appreciation of the Chinese currency.
"A country’s exchange rate policy and its exchange rates should depend on its national economy and economic situation," DPA quoted Wen as saying on Sunday.
Wen said he rejected "finger-pointing" by nations who accuse China of keeping the value of yuan low in order to make its exports cheaper.
He added that China planned to "further improve the yuan exchange rate formation mechanism and keep the yuan exchange rates basically stable at a reasonable and balanced level."
Wen emphasized that the stability of China’s currency had "played an important role in facilitating the recovery of the global economy from the worst financial crisis in decades."
Jim Sinclair’s Commentary
Plausible denial for the month then all of a sudden Chinese dollar reserves decline substantially, just like how gold reserves grew in one month substantially.
The means for this is all the mineral and energy purchases made in dollars.
China wants US reassurance over dollar
Sun Mar 14, 12:01 am ET
BEIJING – China’s premier expressed concern about the U.S. dollar and called on Washington on Sunday to take "concrete steps" to reassure Beijing about the safety of its huge Treasury bond holdings.
"Any fluctuation in the value of the U.S. currency is a big concern for us," Premier Wen Jiabao said at a news conference.
"We cannot afford any mistake, how slight it is, when running our financial assets," he said. "I would like the United States to take concrete steps to reassure investors."
China has pressed Washington to control its yawning budget deficit and prevent inflation that would erode the value of the dollar and China’s holdings.
The premier said Treasury values were a matter of the "national credibility" of the United States.
Jim Sinclair’s Commentary
There were 3 more bank closings on Friday, or should that be changed to Fry Day?
Statewide Bank Covington LA 29561 March 12, 2010 March 12, 2010
Old Southern Bank Orlando FL 58182 March 12, 2010 March 12, 2010
The Park Avenue Bank New York NY 27096 March 12, 2010 March 12, 2010
Jim Sinclair’s Commentary
I wonder if the Chinese have inspected the ETFs.
China to Bar Banks From Buying Index Futures, Securities Reports
By Bloomberg News
March 15 (Bloomberg) — China’s commercial banks won’t be allowed to invest in the nation’s stock index futures, the Shanghai Securities News reported, citing an unidentified person familiar with the situation.
Government regulators have yet to issue any notification of the rules to commercial banks, the Shanghai-based newspaper reported today.
