In The News Today

Posted at 6:18 PM (CST) by & filed under In The News.

The temptation to ignore right action grows from egoism and the acceptance of false values. The wish to satisfy the lower desire is the root of unrighteousness. This wish takes hold of you slyly, pretending to be a comrade come to save you, or like a servant come to attend on you, or like a counsellor come to warn you. Wickedness has a thousand tricks to capture your heart. You must be ever alert against the temptation; you often remind others of right action when you desire to squeeze some advantage from them. You must remember not only the rights that right action confers but also the duties it imposes.
–SSB, Apr 15 1964.

 

Dear CIGAs,

Reports on Cyprus are more the imagination of the reporters

I believe Cyprus is the defining moment whereby the physical market for gold overtakes the paper market for gold as the arbiter of price. When that occurred in 1979 the price of gold began its move to seek its maximum valuation.

Every article written on Cyprus carries the statement of huge percentages to be lost by depositors carefully using the words may, could, or some similar disclaimer. The published statement by the Dutch Minister of Finance who is captain of this initiative was that there would be no particulars until mid April. Simply put, the official EU statement set out broad goals without any specifics. This means that nothing has yet happened in Cyprus to a major deposit holder other than their inability now to access whatever funds they have left in their accounts.

Lets look at how a bank fails. We need to remember that this is a tax haven. Normally in a tax haven the depositors are hostages as they are usually unlikely to make a public legal claim for their secret funds. Management in a tax haven historically feel they had more leeway in how they might conduct themselves compared to a regulated entity in the USA, EU, GB, Switzerland or elsewhere. Deposits are looked at as the means for making banks money in many dicier ways than generally accepted. The entire worldwide banking system from 1991 to 2009 gambled in OTC derivatives as well as every market everywhere with disastrous results industry wide. It is reasonable to assume that the banks in Cyprus, like other banks elsewhere, lost their capital and beyond. That means the accounts held above the insurance level have already been significantly reduced by the losses the banks took in all areas of their business. The bank statements to their depositors have been cartoons. Up until now the bank rescues have made the depositors whole and in selected cases recapitalized the institutions to minimum levels. What the Russian are rightly upset over is that they are the first test case whereby the depositors are not going to be made whole, and may lose additional funds from the real level now of their accounts to finance the rescue this time of the banks, not the banks and depositors.

Since nothing really has happened yet as the particulars of the claimed confiscation to come remain up in the air, the major depositors in Cyprus, the Russians, correctly feel that they are being singled out more so because they are not to be made whole, let alone have any funds confiscated. The people with the biggest risk in this situation are the bank executives and the politicians that have to choose between the EU who can cost them money over the Russians Robber Barons who can cost them more. While all this is happening MSM is on a campaign of making no real facts appear as accomplished facts. None of what is in either of these articles has taken place except the small daily amounts being offered by the ATM machines. Money will flee major banking institutions in the West rather than be subject to what MSM is advertising. There is a greater problem for Cypriot bankers and politicians.

I believe Cyprus is the defining moment whereby the physical market for gold overtakes the paper market for gold as the arbiter of price. When that occurred in 1979 the price of gold began its move to seek its maximum valuation.

Bank of Cyprus big savers to lose up to 60 percent
By MENELAOS HADJICOSTIS | Associated Press

NICOSIA, Cyprus (AP) — Big depositors at Cyprus’ largest bank may be forced to accept losses of up to 60 percent, far more than initially estimated under the European rescue package to save the country from bankruptcy, officials said Saturday.

Deposits of more than 100,000 euros ($128,000) at the Bank of Cyprus will lose 37.5 percent in money that will be converted into bank shares, according to a central bank statement. In a second raid on these accounts, depositors also could lose up to 22.5 percent more, depending on what experts determine is needed to prop up the bank’s reserves. The experts will have 90 days to figure that out.

The remaining 40 percent of big deposits at the Bank of Cyprus will be “temporarily frozen for liquidity reasons,” but continue to accrue existing levels of interest plus another 10 percent, the central bank said.

The savings converted to bank shares would theoretically allow depositors to eventually recover their losses. But the shares now hold little value and it’s uncertain when — if ever — the shares will regain a value equal to the depositors’ losses.

Emergency laws passed last week empower Cypriot authorities to take these actions.

More…

 

Jim Sinclair’s Commentary

Which is worse, Iran with nukes or a totally insane child with a host of nukes and delivery systems?

 

White House taking North Korea’s missile threats seriously
Pentagon says additional missile interceptors being installed in Alaska
The Associated Press
Posted: Mar 29, 2013 6:28 AM ET

WASHINGTON (AP) — The White House said Saturday it is taking seriously new threats by North Korea but also noted Pyongyang’s history of “bellicose rhetoric.”

North Korea warned Seoul on Saturday that the Korean Peninsula had entered “a state of war.” It also threatened to shut down a border factory complex that is the last major symbol of cooperation between the Koreas.

“We’ve seen reports of a new and unconstructive statement from North Korea. We take these threats seriously and remain in close contact with our South Korean allies,” said Caitlin Hayden, a spokeswoman for the White House National Security Council. “But, we would also note that North Korea has a long history of bellicose rhetoric and threats, and today’s announcement follows that familiar pattern.”

North Korea’s threats are seen as part of an effort to provoke the new government in Seoul to change its policies toward Pyongyang, and to win diplomatic talks with Washington that could get it more aid. The moves also are seen as ways to build domestic unity as North Korea’s young leader, Kim Jong Un, strengthens his military credentials.

More…

 

Jim Sinclair’s Commentary

If the PR campaign that claims Cyprus as a template for future bank rescues is real then here is your rescuer.

bookitalianmussolini01

 

Jim Sinclair’s Commentary

The enemy of my enemy is my friend.

Russia, China find compromise on gas deal after 15 year standoff
Reuters Mar 25, 2013, 05.46PM IST

MOSCOW: China has accepted an olive branch from Russia’s Gazprom after years of tough talks which had failed to yield a deal on gas supplies, though the main point of conflict – price – remains.

Gazprom and China National Petroleum Corp (CNPC) agreed on Friday night that 38 billion cubic metres per year of Russian gas would flow to China starting in 2018 and come only from Russia’s East Siberian fields, rather than the West Siberian fields which also supply Europe.

In signing the memorandum of understanding, Gazprom gave up its a dream of using its core fields in West Siberia to supply both Europe and China to become a “swing supplier” capable of sending the same gas east or west, depending on the most lucrative price option.

The 38 bcm is less than the planned 68 billion cubic metres per year it would have shipped under an earlier agreement which envisaged shipments from both untapped new fields in East Siberia which would be linked to China by a new pipeline, and West Siberia.

Even at that reduced volume, China would be Gazprom’s largest customer, ahead of EU member Germany, which took over 33 bcm of Russian gas last year.

More…

 

Jim Sinclair’s Commentary

The ice is out. I have my Bering Sea immersion suit. It is time to get into the lake. Off I go. This time I got out 20 feet before the mud stopped me. Back to the road. The brakes failed, and the transmission linkage disconnected. That will not discourage me. If anything, I am persistent.

 photo

 

Jim Sinclair’s Commentary

Get out of the system to the best degree you can possibly accomplish.

Even though no real action has been taken yet in Cyprus, these horse’s asses might really do it.

I went to sleep Friday as a rich man. I woke up a poor man.
NICK MILLER March 29, 2013

”Very bad, very, very bad,” says 65-year-old John Demetriou, rubbing tears from his lined face with thick fingers. ”I lost all my money.”

John now lives in the picturesque fishing village of Liopetri on Cyprus’ south coast. But for 35 years he lived at Bondi Junction and worked days, nights and weekends in Sydney markets selling jewellery and imitation jewellery.

He had left Cyprus in the early 1970s at the height of its war with Turkey, taking his wife and young children to safety in Australia. He built a life from nothing and, gradually, a substantial nest egg. He retired to Cyprus in 2007 with about $1 million, his life savings.

He planned to spend it on his grandchildren – some of whom live in Cyprus – putting them through university and setting them up. There would be medical bills; he has a heart condition. The interest was paying for a comfortable retirement, and trips back to Australia. He also toyed with the idea of buying a boat.

He wanted to leave any big purchases a few years, to be sure this was where he would spend his retirement. There was no hurry. But now it is all gone.

More…

 

Jim Sinclair’s Commentary

These half wits might really go through with their threats in Cyprus.

Hobby farms sound better all the time. So far at this time all that has occurred in Cyprus is limitations on ATM withdrawals.

Petunia will always have her meals.

Cypriot fury as cash limit hurts business
Andrew Higgins and Liz Alderman March 30, 2013

Farmers are unable to withdraw enough money to feed their animals.

As Cyprus cautiously cracked open the doors of its crisis-ridden banks on Thursday, pig farmer Stelios Sofroniou fumed at being able to withdraw only €300 ($369). That would buy just 1 tonne of feed, not the 30 tonnes he needed for his 15,000 pigs.

”We were in the Stone Age, and now we’re entering the 19th century,” he said in this village near the capital Nicosia after visiting his branch of the Bank of Cyprus, which had not been open since March 15.

He cursed the strict new controls that for at least the next week will give him access to only a tiny portion of his money and stop him from cashing cheques freely or using his bank to pay suppliers who use different ones.

Across Cyprus, fears that the reopening could lead to a chaotic bank run gave way to conflicting emotions: relief that banks were at least open again, but anger over the new rules, which allow deposits but restrict withdrawals.

More…