Jim Sinclair’s Commentary

Maybe it never have dawned on the US Administrations that you should not treat your banker badly.

The legislative just made a motion again to declare China a currency manipulator, unmindful that the economic future of the entire West depends on China increasing their US Treasury position.

China Sold More Treasurys in June
AUGUST 16, 2010, 2:05 P.M. ET
By TOM BARKLEY And MEENA THIRUVENGADAM

WASHINGTON—China was a net seller of U.S. Treasurys for a second straight month in June, while overall inflows into long-term U.S. assets continued, the Treasury Department said Monday.

China’s holdings fell $24 billion to $843.7 billion, though it remained the largest foreign holder of Treasurys. That followed net sales of $32.5 billion in May.

Recent bouts of selling by China have stoked concerns that the largest creditor nation to the U.S. may reduce its exposure, though the move has partly reflected a portfolio rebalancing into longer-term securities.

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Among all foreign investors, net purchases of U.S. Treasury notes and bonds totaled $33.3 billion in June, compared with net buying of $14.9 billion the previous month.

Japan, the second-largest holder of Treasurys, was a net buyer, boosting its portfolio to $803.6 billion from $786.7 billion in May.

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Jim Sinclair’s Commentary

The downward spiral is now in control. Because the intervention only lined the pockets of the Banksters, the economic recovery was more virtual than real. Now we are headed to lower Western world economic lows.

NY manufacturing falls short of forecast
By Wanfeng Zhou
NEW YORK | Mon Aug 16, 2010 9:53am EDT

(Reuters) – A gauge of U.S. regional manufacturing rose in August after plunging the previous month, but it fell short of forecasts and contained some grim details, adding to evidence the U.S. recovery is losing momentum.

The New York Federal Reserve said on Monday that its "Empire State" general business conditions index increased to 7.10 in August from 5.08 in July. The figure was below the 8.00 expected by economists polled by Reuters.

Despite this month’s small rise, the index remains well below its recent high near 32 reached in April. The report is consistent with other recent data showing the U.S. economy has slowed considerably in the past few months, though most economists say a double-dip recession remains unlikely.

"While I don’t take the view that the economy is faltering, what’s happening out there is that there is not a lot of growth out there," said Joel Naroff, president, Naroff Economic Advisors in Holland, Pennsylvania.

U.S. stock futures briefly dipped after the data before rebounding. Wall Street was under selling pressure on Monday amid worries about the strength of the global economy.

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Jim Sinclair’s Commentary

All these deals are fraudulent. They are anything from a letter of credit scam to a litigation trap.

Over the years I have received hundreds of calls from CIGAs who think they just hit the jack pot. I got one of those calls today from Australia.

They are all raving bullshit and should be avoided like the Plague

Tons of gold imports turn to dust on arrival
Gold imported into the UAE by traders and investors turned out to be fake on closer inspection
By* VM Sathish
Published Sunday, August 15, 2010

Several tons of gold imported into the UAE by traders and investors turned out to be fake on closer inspection, resulting in millions of dirhams in losses and high levels of stress to the victims.

Speaking to Emirates 24|7, Mohamad Shakarchi,, Managing Director of Emirates Gold, said: "A lot of people in the UAE who tried to import gold at lower prices or through dubious overseas companies have been cheated.

We have inspected many consignments from African countries, especially Ghana, and found that there is not an ounce of gold in them.

For importing pure dust or other metals with yellow colour, these traders have paid several million dirhams.”

Dubai Customs sources confirmed the incidence of fake gold imports, but did not reply to a questionnaire sent by Emirates 24|7 ten days ago.

“The concerned official is on leave,” said a spokesman.

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Jim Sinclair’s Commentary

Everything is lining up for illustration number three of today’s attempt to get you to understand Currency Induced Cost Push Inflation, our future.

China Favors Euro to Dollar as Bernanke Shifts Course (Update3)
By Candice Zachariahs and Ron Harui – Aug 16, 2010 11:42 AM

China, whose $2.45 trillion in foreign-exchange reserves are the world’s largest, is turning bullish on Europe and Japan at the expense of the U.S.

The nation has been buying “quite a lot” of European bonds, said Yu Yongding, a former adviser to the People’s Bank of China who was part of a foreign-policy advisory committee that visited France, Spain and Germany from June 20 to July 2. Japan’s Ministry of Finance said Aug. 9 that China bought 1.73 trillion yen ($20.1 billion) more Japanese debt than it sold in the first half of 2010, the fastest pace of purchases in at least five years.

“Diversification should be a basic principle,” Yu said in an interview, adding a “top-level Chinese central banker” told him to convey to European policy makers China’s confidence in the region’s economy and currency. “We didn’t sell any European bonds or assets, instead we bought quite a lot.”

China’s position may make it harder for the greenback to rebound after falling as much as 10 percent from this year’s peak in June as measured by the trade-weighted Dollar Index. The nation cut its holdings of U.S. government debt by $100 billion, or 11 percent, through June from last year’s record of $939.9 billion in July 2009, according to Treasury Department data released today.

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Jim Sinclair’s Commentary

There has been no change in the fact that Wall Street owns Washington.

You expected anything different?

Banks to benefit most from White House program to help fight foreclosures
By Vicki Needham – 08/15/10 03:05 PM ET

Banks will get the biggest benefit from an Obama administration housing program designed to help unemployed homeowners escape foreclosure.

Housing experts expressed concern that banks, not homeowners, will be helped by the White House’s $3 billion funding infusion — $2 billion from the Treasury Department and another $1 billion from the Housing and Urban Development Department — going to those states hit hardest by the housing market crash and unemployment.

"Giving money to the banks isn’t what the government should be doing right now," said Dean Baker, co-founder of the Center for Economic and Policy Research.

"I’m not a big fan; it’s ill-conceived," he said.

The basic principle is to help struggling homeowners but with so many people underwater on their mortgages the new funding is unlikely to do much good, Baker said.

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