Dear CIGAs,
If it happens three times then we should examine put option activity and ex drug trade submersibles.
Offshore Oil Platform in the Gulf of Mexico Explodes
By CAMPBELL ROBERTSON and JACK HEALY
Published: September 2, 2010
NEW ORLEANS — An offshore oil platform exploded in the Gulf of Mexico on Thursday morning, injuring one worker, the United States Coast Guard said.
The platform, which was owned by the Houston-based Mariner Energy, was floating in relatively shallow waters 340 feet deep to the west of where a drilling rig leased by BP blew up and sank this spring, killing 11 people and touching off an environmental calamity.All 13 members of the work crew on board Thursday were accounted for, the Coast Guard said, though the injured worker’s condition was not immediately known.
Early reports said the crew members had all been evacuated from the platform and were flown to a hospital in Houma, La.
News reports said there was smoke rising from the platform, but it was unclear whether the rig was actively burning or in danger of foundering, or whether the explosion had set off any underground oil leaks.
The platform radioed a distress call at 9 a.m. central time on Thursday, prompting the Coast Guard to scramble seven helicopters to reach the site of the explosion, located 80 miles south of Vermilion Bay in Louisiana, said Katherine McNamara, with the 8th District office of the Coast Guard, in New Orleans.
Jim Sinclair’s Commentary
They just discovered this? This has been so since the invention of the corporate form.
Study says most corporations pay no U.S. income taxes
Tue Aug 12 16:54:14 UTC 2008
WASHINGTON (Reuters) – Most U.S. and foreign corporations doing business in the United States avoid paying any federal income taxes, despite trillions of dollars worth of sales, a government study released on Tuesday said.
The Government Accountability Office said 72 percent of all foreign corporations and about 57 percent of U.S. companies doing business in the United States paid no federal income taxes for at least one year between 1998 and 2005.
More than half of foreign companies and about 42 percent of U.S. companies paid no U.S. income taxes for two or more years in that period, the report said.
During that time corporate sales in the United States totaled $2.5 trillion, according to Democratic Sens. Carl Levin of Michigan and Byron Dorgan of North Dakota, who requested the GAO study.
The report did not name any companies. The GAO said corporations escaped paying federal income taxes for a variety of reasons including operating losses, tax credits and an ability to use transactions within the company to shift income to low tax countries.
Jim Sinclair’s Commentary
Good move, but what do you think the chances are of ever seeing it here?
EU May Limit Naked Shorts of Stocks, Government Debt
By Ben Moshinsky – Sep 2, 2010 12:53 PM ET
Naked short sales of shares and government bonds may be limited by European Union proposals that say the practices cause a “disorderly market and possible systemic risks.”
Under the proposed rules, traders would be required to submit proof they can access the underlying security to settle a trade designed to profit from falling prices, according to a European Commission document obtained by Bloomberg News. The rules would need approval of the full commission before being submitted to the Parliament and national governments.
The rules would bring the EU closer to the stance taken by Germany, where Chancellor Angela Merkel banned some naked short selling in May. Merkel and French President Nicolas Sarkozy argued that some bets against stocks and government bonds should be banned as the Greek debt crisis made markets more volatile.
The proposed legislation would ban most naked short selling depending on “what you mean by naked,” said Simon Gleeson, a regulatory lawyer at Clifford Chance LLP in London.
Jim Sinclair’s Commentary
The cause is simple. It is OTC derivative fraud that managed to make a disaster out of a normal four year economic contraction. That is the SOLE REASON.
There was no intervention at the cause and the OTC derivative market continues to grow.
The financial Pepto-Bismol did only one thing: make the Banksters richer than even they ever dreamed of.
Romer serves dismal for lunch. Pepto-Bismol for dessert?
By Dana Milbank
Thursday, September 2, 2010
Lunch at the National Press Club on Wednesday caused some serious indigestion.
It wasn’t the food; it was the entertainment. Christina Romer, chairman of President Obama’s Council of Economic Advisers, was giving what was billed as her "valedictory" before she returns to teach at Berkeley, and she used the swan song to establish four points, each more unnerving than the last:
She had no idea how bad the economic collapse would be. She still doesn’t understand exactly why it was so bad. The response to the collapse was inadequate. And she doesn’t have much of an idea about how to fix things.
What she did have was a binder full of scary descriptions and warnings, offered with a perma-smile and singsong delivery: "Terrible recession. . . . Incredibly searing. . . . Dramatically below trend. . . . Suffering terribly. . . . Risk of making high unemployment permanent. . . . Economic nightmare."
Anybody want dessert?
At week’s end, Romer will leave the council chairmanship after what surely has been the most dismal tenure anybody in that post has had: a loss of nearly 4 million jobs in a year and a half. That’s not Romer’s fault; the financial collapse occurred before she, and Obama, took office. But she was the president’s top economist during a time when the administration consistently underestimated the depth of the economy’s troubles – miscalculations that have caused Americans to lose faith in the president and the Democrats.
Jim Sinclair’s Commentary
Except for the demonic Banksters, this will be four out of four before 2012.
POLL: Unemployment Affects Three Out Of Four Americans
First Posted: 09- 1-10 12:35 PM
Nearly three out of four Americans have been directly affected by the recession, either because they have been unemployed or know someone who has lost their job, according to a new survey.
The report, prepared by Rutgers professors Carl Van Horn and Cliff Zukin, find that 73% of Americans have either been unemployed themselves (14%) or saw an immediate family member (12%), another member of their family (30%) or a close friend (17%) lose a job.
The survey also finds profound pessimism about where the economy is headed. More than half of Americans say they believe the downturn reflects a "lasting economic change" (56%) rather than a "temporary economic downturn" (43%). Large majorities believe that the economy will remain in recession or worse a year from now.
"After suffering through the worst economic disaster most have ever experienced," Van Horn said in a statement, "American workers have diminished expectations about America’s economic future and do not have much faith that the nation’s political leaders can move the country forward."
Asked about the causes of joblessness, the survey respondents mentioned three above all: global economic competition, illegal immigration and Wall Street bankers.
Jim Sinclair’s Commentary
This is a great development which we should all hope gets traction because an audit of conditions and presence would be a major moon launch on the bullish side for the price of gold.
The key to the audit must be deliverable condition.
Fox News takes Kitco’s Ron Paul gold audit story national
Submitted by cpowell on Thu, 2010-09-02 01:29
9:40p ET Wednesday, September 1, 2010
Dear Friend of GATA and Gold:
Congratulations to Kitco News and its reporter Daniela Cambone for having broken last week what this week Fox News made into a national story, the call by U.S. Rep. Ron Paul, R-Texas, for a serious audit of U.S. gold reserves. The Fox News story, broadcast and posted today and appended here, is notable for two reasons apart from calling attention to the audit issue.
First, the Fox News story quotes Paul as remarking that the audit should determine not only the simple presence of gold in the U.S. government’s vaults at Fort Knox, Kentucky, and elsewhere but also "whether any of it has been obligated."
That is, Paul is fully aware of the Federal Reserve’s involvement in gold swaps with foreign banks, an admission made by Fed Governor Kevin M. Warsh a year ago in the course of GATA’s litigation against the Fed under the Freedom of Information Act, even as Warsh insisted that the Fed’s gold swap arrangements must remain secret:
http://www.gata.org/files/GATAFedResponse-09-17-2009.pdf
And second, the Fox News story is notable for the refusal of the Treasury Department to comment about the gold audit issue: "Representatives from the Treasury Department and U.S. Mint did not respond to requests for comment on Paul’s proposal."
Imagine what would happen if mainstream financial news organizations began to put detailed, coherent questions to the Fed and Treasury Department about the disposition of the U.S. gold reserve, the gold swap arrangements, and the overwhelming if obscure public record of Fed, Treasury, and other U.S. government agency interest in suppressing the gold price:
Jim Sinclair’s Commentary
Did you see the BBC special, "The Last Days of Lehman"? If not you certainly should!
The collapse of Lehman is what broke the chain in OTC derivatives, thereby killing the one method that existed for fixing the fraudulent OTC derivative problem. That method was Bad Derivative Bank, Good International Investment firms which could have zeroed the whole mess.
However the collapse of Lehman did bring on the OTC derivative crisis which did fix the cash flow problem of the financial industry. The flushing of Lehman also fortuitously left the majority of the distribution of TARP money in the hands of the past administration.
Lehman boss blames US for bank’s collapse
WASHINGTON — The former head of collapsed US banking giant Lehman Brothers lashed out at the US government Wednesday, claiming it could have prevented the firm’s collapse but failed to act.
Dick Fuld — who became a poster child for the ills of the banking sector — demanded to know why the government had rushed to help competitors but not Lehman, in prepared testimony for a committee investigating the financial crisis.
"Lehman was forced into bankruptcy not because it neglected to act responsibly or seek solutions to the crisis, but because of a decision, based on flawed information, not to provide Lehman with the support given to each of its competitors."
Fuld detailed measures he said could have helped save the bank and complained that "each measure was later implemented in some form for other investment banks during the days and weeks following Lehman?s bankruptcy filing."
"Had Lehman been granted that same access as its competitors… Lehman would have had time for at least an orderly wind down or for an acquisition which would have alleviated the crisis that ensued."
Jim Sinclair’s Commentary
Of course the ECB will remain in crisis mode. Bernanke has confirmed the same, therefore making illustration #2 below confirmed.
Illustration #2 had to be confirmed to get to illustration #3
ECB Keeps Key Interest Rate at 1%, May Maintain Crisis Mode
By Christian Vits – Sep 2, 2010 4:45 AM PT Thu Sep 02 11:45:38 GMT 2010
The European Central Bank kept interest rates at a record low today and President Jean-Claude Trichet may signal the bank will stay in crisis mode into next year.
The ECB’s Governing Council set the benchmark lending rate at 1 percent for a 17th month, as predicted by all 57 economists in a Bloomberg News survey. Policy makers are also likely to extend emergency lending measures for banks into 2011 as the risk of a renewed U.S. recession threatens the euro region’s economic rebound, economists said. Trichet holds a press conference at 2:30 p.m. in Frankfurt.
“The ECB would like to end its extraordinary measures relatively soon but the situation is still too fragile to return to the exit path before year-end,” said Juergen Michels, chief euro-area economist at Citigroup Inc. in London. The euro was at $1.2828 shortly before the rate decision.
While the ECB will probably raise its growth forecasts today after Europe’s economy expanded at the fastest pace in four years in the second quarter, the sovereign debt crisis and a U.S. slowdown pose risks to the outlook. Council member Axel Weber said in an Aug. 19 interview that the ECB should help banks through end-of-year liquidity tensions before determining early next year when to withdraw emergency measures.
Jim Sinclair’s Commentary
The difference between now and the 1930s is the problems is NOT simply one country or republic, but rather the entire Western World financial system.
Armstrong has made the point that trends and cycles in history repeat, but never in the exact same form.
The form here is the most dangerous of all economic history, including the fall of Rome.
International Monetary Fund Warns G7 on Debt
Published: Thursday, 2 Sep 2010 | 3:34 AM ET
By: Sewell Chan
The world’s most developed economies, which have been racking up spending since the mid-1960s, face record levels of debt as a result of the 2008-9 financial crisis and have little room for maneuver, the International Monetary Fund warned on Wednesday.
Despite the stark warning and the prospect that the wealthiest nations face years of belt-tightening, the fund also said that the risk of default by heavily indebted European countries like Greece, Ireland and Portugal had been significantly overestimated.
In three new research papers, the fund’s economists offered stern admonitions while cautioning against an overreaction.
That mix of messages was reflected in one paper on the long-term trends in the public finances of the Group of 7 economies.
The authors, Carlo Cottarelli, director of fiscal affairs, and Andrea Schaechter, a senior economist, concluded that public debt had served for decades as “the ultimate shock absorber — rising in bad times but not declining much in good times.”
Jim Sinclair’s Commentary
Countries do NOT default, they reschedule debt. The currency is what defaults.
IMF ponders the improbable: Will U.S. default?
By Howard Schneider
Will the U.S. government ever default?
It’s not a pleasant thought for anyone holding some of the roughly $9 trillion in U.S. government bonds and notes currently in public hands – or for anyone hoping the global economy can stay on an even keel.
But the economists at the International Monetary Fund are paid to ponder the improbable, and in papers published on Wednesday fund staff examined where the U.S. and other developed countries fit on a continuum between easy living and disaster.
We’re farther along than you might think.
Using a concept known as "fiscal space" – basically how much latitude a country has to borrow before markets will shut off the spigot by demanding unsustainable interest rates – the IMF staff drew a bright red line through five nations it considers to be running out of room: Greece, Iceland, Italy, Japan and Portugal. Of the 23 developed nations it analyzed, four others, including the U.S., received a yellow caution flag.
Does it mean default is imminent or inevitable? Hardly – and in companion articles the fund discussed the steps being taken to control public debt, and broadly discounted the chance of an outright sovereign default among any of the advanced countries.
Jim Sinclair’s Commentary
The author of this article is in harm’s way. He should contact Greg Hunter to find out what problems a reporter can have when he tells the truth.
This is another reason why the community and all its commentators should give Greg Hunter their full and unwavering support.
Widespread U.S. hiring not begun: ADP’s Prakken
Wed Sep 1, 2010 9:05am EDT
NEW YORK (Reuters) – Widespread hiring at U.S. companies has not begun as businesses remain worried about uncertainty over the future of the economy, Macroeconomic Advisers LLC chairman Joel Prakken said on Wednesday.
Prakken was speaking to a teleconference of journalists after the ADP Employer Services report on private sector employment, which his firm jointly developed. The report showed private employers unexpectedly cut 10,000 jobs last month.
Prakken said he expects Friday’s U.S. nonfarm payrolls report to be solidly in negative territory, hurt in part by the continuing evaporation of Census jobs.
Prakken said that while Wednesday’s figure was disappointing, it was not particularly surprising given other recent economic data that has suggested a slowing recovery.
