My Dear Friends,
The non-emotional connection between Gold and the Ukraine is the fact that the PPT cannot break the long term price relationship of gold to debt developments.
The Ukraine owes north of $35 billion to the international financial community over the next 18 months and that does not even consider the present day cash requirement in that period. It is reasonable to expect the Ukrainian cash needs in 18 months to close in on $50 billion.
As the IMF has been clear on it, the East Ukraine in their industrialized position plays a key role in sustaining debt repayment.
The new manner of international conflict is a high stakes chess game that the West is not used to playing successfully. As such, the manipulators to the PPT have their hands full holding gold from its rightful role of reflecting major shifts in debt, both as to size and integrity. The Ukraine is now the prime focus in this.
Gold will move higher into the summer, changing the face of the common action of metals over these months regardless of the manipulator’s desire to prevent that.
Putin oversees Russian nuclear forces exercise
May. 8, 2014 6:40 AM EDT
MOSCOW (AP) — President Vladimir Putin on Thursday oversaw a military exercise involving Russia’s nuclear forces amid escalating tensions over Ukraine.
While Putin said the exercise had been planned back in November, it comes as relations between Russia and the West have plunged to their lowest point since the Cold War over Ukraine.
Putin, speaking from the Defense Ministry’s headquarters where he oversaw the exercise along with leaders of several ex-Soviet nations which are members of the Collective Security Treaty Organization, said that the maneuvers involved the military across the entire Russian territory, including the nation’s nuclear forces.
Russian news wires said that the exercises simulated dealing a massive retaliatory nuclear strike in response to an enemy attack. The description of the exercise is unusually blunt, reflecting tensions with the West running high over Ukraine.
As part of the maneuvers, a Topol intercontinental ballistic missile launched from the Plesetsk launch pad in northwestern Russia successfully hit a designated target on the Kura testing range on the far eastern Kamchatka peninsula, the military said.
Two nuclear submarines of the Northern and Pacific Fleets, the Tula and the Podolsk, also fired intercontinental ballistic missiles.
Russian aircraft carrier sails into English Channel
HMS Dragon is escorting the Russian aircraft carrier Admiral Kuznetsov through the English Channel
By Ben Farmer, Defence Correspondent
1:26PM BST 08 May 2014
A Russian aircraft carrier task group has sailed into the English Channel under escort by a Royal Navy warship.
HMS Dragon met the Russian warships in the south western approaches to the Channel on Wednesday and is shadowing them as they are expected to head into the North Sea and back to Russia.
The heavy carrier Admiral Kuznetsov is accompanied by the nuclear-powered Kirov class cruiser Peter the Great and several support ships after a five-month mission to the Mediterranean.
Naval sources said it was not unusual for Russian warships to pass through the channel and the Kuznetsov was also escorted past British waters on its way out in December when it passed Scotland heading south.
Capt Vadim Serga, spokesman for the Russian Northern Fleet, said: “The cruiser has accomplished its mission within the Navy task force in the Mediterranean and headed for Severomorsk. The aircraft carrier Admiral Kuznetsov is expected to return to base by late May.”
Russia planes fly to California coast in show of force over Ukraine, U.S. commander says
CBS/APMay 6, 2014, 10:14 AM
WASHINGTON — The commander of U.S. air forces in the Pacific has reported a significant increase in activities by Russian planes and ships in the region.
Gen. Herbert Carlisle linked the uptick in Russian traffic to the situation in Ukraine. He said Russia was demonstrating its capabilities and gathering intelligence on U.S. military exercises.
Carlisle said there had been long-range Russian air patrols to the coast of California and a circumnavigation of the U.S. Pacific territory of Guam. He said a U.S. F-15 fighter jet intercepted a Russian strategic bomber that had flown to Guam.
"It’s a combination of things that’s to demonstrate their capability to do it," Carlisle said Monday at the Center for Strategic and International Studies think tank in Washington, according to a Reuters transcript of his remarks.
Overall, Carlisle deemed it a significant "increase in the activity from Russia in the Asia-Pacific, and we relate a lot of that to what’s going on in the Ukraine."
Ukraine Bulls Scatter as Death Toll Mounts: East Europe Credit
By Andras Gergely and Natasha Doff
Investors tempted to Ukraine by the prospect of a foreign bailout are sounding the retreat as deadly clashes between government forces and separatists threaten to overwhelm efforts to prop up the nation’s finances.
JPMorgan Chase & Co., which advised clients earlier this year to increase Ukrainian bond holdings on expectations that a civil war was an “extreme” scenario, is now warning of the risk of “huge” economic fallout as the former Soviet Republic’s territorial integrity crumbles. Barclays Plc said it’s urging caution on anything but the shortest maturities in Ukraine’s debt, with Capital Economics Ltd. anticipating a deeper selloff.
The yield on Ukraine’s benchmark Eurobonds have surged more than two percentage points in the past month and headed toward the record 11.4 percent reached on Feb. 19 even as the International Monetary Fund’s board approved a $17 billion lifeline last week to avert default. Four government servicemen and 30 rebels died on May 5 as Ukrainian forces attempted to dislodge separatists who have seized more than 30 administrative buildings in the eastern Donetsk and Luhansk regions.
“We are now at a turning point where the economics part of the equation is the least of our worries,” Simon Quijano-Evans, head of emerging market research at Commerzbank AG in London, said by e-mail yesterday. “Markets are having to price in factors that are frankly outside anyone’s control.”
Jim Sinclair’s Commentary
The serious game of international chess continues.
Russia holds military drills to repel nuclear strike
Published time: May 08, 2014 10:21
Edited time: May 08, 2014 14:00
President Vladimir Putin has overseen military drills on countering nuclear strike. The planned drills come ahead of the May 9 celebrations dedicated to victory in World War II.
"We are carrying out tests of the readiness of the Russian armed forces. It was announced last November. The exercises will involve all branches of the armed forces across the country," Putin told reporters at the Defense Ministry.
Modern challenges and threats to the country’s national security demand that the army and the fleet are maintained in readiness for quick and effective retaliation in any conditions, the Russian Defense Minister and army general Sergey Shoigu told Putin in a report.
During the drills, it was demonstrated how the missile corps, artillery, aviation and anti-aircraft defenses can be used – for instance, to destroy troops on the ground or to counter massive missile, aviation or nuclear strikes by an enemy.
Plus, it was shown how to inflict a launch-through-attack strike with nuclear missiles.
The training exercises, which are due to include ground troops and artillery as well as the air force, were held during a summit of heads of state of a security bloc made up of former Soviet states.
Led by Russian President Vladimir Putin, Russian aerospace defense troops have successfully overridden a massive nuclear missile strike, an official representative of the Russian Defense Ministry told RIA Novosti news agency.
Jim Sinclair’s Commentary
There is no change in the reasons why one should own gold.
Fed Chair: ‘Deficits Will Rise to Unsustainable Levels’
May 7, 2014 – 5:27 PM
By Terence P. Jeffrey
(CNSNews.com) – Federal Reserve Chairman Janet Yellen, referencing the Congressional Budget Office’s long-term budget projections, told the Joint Economic Committee of Congress today that under current policies the federal government’s deficits “will rise to unsustainable levels.”
In the 10-year budget projections it released in April, the CBO estimated that the federal government will run $7.618 trillion in deficits from 2015 through 2024. At the same time, the CBO projected that the federal government’s debt held by the public would rise from $11.983 trillion at the end of fiscal 2013 to $20.947 trillion by the end of 2024.
The debt held by the public is the part of the U.S. government debt that is not held by the federal government itself. It primarily consists of marketable Treasury securities, including bills, notes and bonds. It does not include what the government calls “intragovernmental debt," which is the money the Treasury has borrowed out of the Social Security Trust Fund and other government trust funds to pay current expenses.
The total debt of the federal government at the end of fiscal 2013–including both the debt held by the public and the intragovernmental debt–was $16.719 trillion. The CBO estimates that by 2024, the total debt of the federal government will be $27.159 trillion—of which $20.947 trillion will be debt held by the public.
If that projection holds up, the federal debt held by the public in 2024 would be more than four times the $5.035 trillion federal debt held by the public at the end of 2007.
Yellen made her statement about unsustainable deficits when she was question by Sen. Dan Coats (R.-Ind.). Coats remarked that businessmen in Indiana told him that their businesses were underperforming at this time because of the uncertainty they felt as result of federal taxation and regulatory policies.