Jim Sinclair’s Commentary

Gold is debt. The debt is set. So too is the future of gold as it goes ballistic.

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Jim Sinclair’s Commentary

And restructure they will as the entire Western World plays the QE game.

Notes From Underground: Hey Mr.Bernanke and/FED–GOD GAVE YOU TWO EARS and ONE MOUTH SO LISTEN MORE AND SPEAK LESS!
By Yra

The news out of Europe today was not favorable for Greece as it was reported in the German paper DIE WELT that German Finance Minister Wolfgang Schäuble ^[2] suggested Greece would need to restructure. Schäuble’s comments led the cost of interest rate on the DEBT of the peripherals to rise. By day’s end, Greek 2-year rates climbed to 16.8 percent. Portugal rose 25 basis points to 8.87 percent and Ireland increased 25 basis points to 8.20 percent. Spain’s bonds were also priced higher as rates increased 10 basis points. All in all, not a very splendid day for the European debt-stressed nations, but yet again the DOLLAR could not gain ground against the EURO as an initial DOLLAR rally faded quickly. It appears that some central banks are recalibrating reserves as even a DOLLAR rally seems to be so short-lived. The EURO has performed well even though it has the cloud of uncertainty overhanging its economic and political situation.

This weekend may see the European bailout plan be upended if the TRUE FINNS ^[3] win an outright victory in Finland. If the anti-EURO PARTY were to win it would be a statement that the FINNISH CITIZENRY want no part of national bailouts by the ECB or any other mechanism. The reverberations in Berlin will be felt and Frau Merkel will be in an even more difficult political position as the anti-Europe forces within Germany will be louder and certainly stronger. If the TRUE FINNS win and the DOLLAR still fails to rally, it will be a signal that other factors are at work and the DOLLAR is suffering from some structural defects beyond the immediate radar screen.

As an example of the incomprehensibility of the rating agencies, Moritz Kraemer, head of S&P’s European debt-evaluation group stated ^[4]: “Greece’s rating clearly signals that the risk of an eventual restructuring has risen over the last year or two. However, if you look at historical default rates at a BB rating level,the base case is still they would not restructure.” It never ceases to amaze me how the ratings agencies stay in business. If I could question Mr. Kraemer I would ask how much Greek debt S&P is buying for its investors. Again, a great many people talking and not many listening to what the market has to say.

Which brings me to the tonight’s headline. There is so much chatter coming from FED officials about transitory inflation and exit strategies and today we had PLOSSER ^[5] speaking ^[5] on the need for inflation targets. FED officials are busy telling the market what to think and do but the collective wisdom of the market  is telling the key policy makers that it is very worried about the effectiveness of the FED. Goldman’s two-day assault on the commodity market was reversed as GOLD and SILVER rallied to new recent highs and even the OIL market reversed. Yesterday, I cautioned that the DOLLAR‘s failure to rally was a warning that all is not right in the world.

More… ^[6]

Jim Sinclair’s Commentary

Gold is going ballistic.

We are on the threshold of the phenomena of 1979. Gold is getting ready to go ballistic.

$1650 will fall like it did not even exist.