Posted at 5:07 PM (CST) by & filed under Jim's Mailbox.

Jim,

QE to infinity?

CIGA Craig

Craig,

QE to Infinity, or whatever new name they decide to give it.

Jim

Fed’s Bullard says QE3 could last longer than October
Published: Oct 16, 2014 10:33 a.m. ET

The Federal Reserve should consider extending its bond-buying program beyond October to see how the U.S. economic outlook evolves, said James Bullard, the president of the St. Louis Fed, on Thursday. At the moment, the Fed is buying $15 billion in securities each month. The U.S. central bank has said it expects to end its QE3 program at the end of October, but Bullard noted that the plan was always data-dependent. Bullard said the Fed cannot "abide" the drop in inflation expectations seen in the Treasury Inflation-Protected Securities. "Maybe this is a juncture where we want to invoke this clause that it is data-dependent," Bullard said in an interview with Bloomberg News.

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Posted at 5:26 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

John Williams shares his views.

- September Retail Sales Declined, August and September Activity Revised Lower and Third-Quarter Broad Growth Slowed Sharply 
- Unstable Seasonal Factors Helped Push Headline PPI Lower

"No. 665: September Retail Sales, PPI" 
Web-page: http://www.shadowstats.com

Second Ebola-Infected Nurse Identified, Was Symptomatic With 99.5 Degree Fever While Flying
Submitted by Tyler Durden on 10/15/2014 14:18 -0400

Just about an hour ago, the CDC’s Tom Frieden held a press conference in which he tried to diffuse the CDC’s incompetence for a allowing healthcare workers who cared for the now deceased "Index Patient" Thomas Eric Duncan, to board a plane. A worker, who as was reported earlier today, was confirmed sick with the deadly virus. Still, in order to defend his agency from accusations of gross incompetence, of which it clearly is guilty, Frieden said that…

NEW PATIENT HADN’T BEEN BLEEDING OR VOMITING BEFORE FLIGHT

… Although, he promptly pushed the ball of blame back in her court adding that:

NEW PATIENT KNOWINGLY EXPOSED TO EBOLA,SHOULDNT HAVE FLOWN

But what is worse, is that as the WaPo reports the nurse had a fever of 99.5 degrees Fahrenheit before boarding a passenger jet on Monday, a day before she reported symptoms of the virus and was tested, according to public health officials. "Even though there appeared to be little risk for the other people on that flight, she should not have traveled that way, Thomas Frieden, director of the Centers for Disease Control and Prevention, said during a news conference Wednesday."

“She should not have flown on a commercial airline,” Frieden said.

The reason he said that is that since she was clearly symptomatic, she was also contagious. Which explains why the CDC is scrambling to uncover all those passengers who may have flowen with her. 

Furthermore, the nurse has now been identified: "The health-care worker was not identified by public health officials, but family members told Reuters and the Dallas Morning News that her name is Amber Vinson, a nurse at Texas Health Presbyterian Hospital. She was part of a team that had cared for Thomas Eric Duncan, a Liberian man who flew to Texas and was diagnosed with Ebola last month, during his hospitalization in Dallas. Duncan died last week. Nina Pham, a nurse who also cared for Duncan, was diagnosed with Ebola on Sunday."

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Jim Sinclair’s Commentary

Mr. Biff watching the Dow Industrial Averages today.

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Jim Sinclair’s Commentary

This is a key battle taking place.

US military admits Isil ‘has tactical momentum’ as jihadist siege of Kobane continues
Barack Obama meets with generals from 22 countries as Isil fighters advance in western Iraq 
By Raf Sanchez, Washington
6:45AM BST 15 Oct 2014

The US military admitted last night that Isil "has tactical momentum on several fronts" as jihadist forces continued to make advances in both Syria and Iraq.

American warplanes dramatically escalated strikes against Isil fighters laying siege to the Syrian town of Kobane but have so far been unable to push the jihadists back.

Meanwhile, Isil forces surrounded a major airbase in western Iraq and are threatening to overrun government forces there.

The jihadists’ endurance on the battlefield in both countries raises questions about whether the American-led air campaign is succeeding in meeting President Barack Obama’s goal of "defeating and ultimately destroying Isil".

Mr Obama met with a war council of generals from 22 countries last night to discuss the coalition effort against the jihadists.

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Jim Sinclair’s Commentary

Bad economic news is now bad equity news.

Retail Sales Bloodbath: Control Group Has First Decline Since "Polar Vortex"
Submitted by Tyler Durden on 10/15/2014 08:47 -0400

It may come as a shocker to some, but hopefully not to anyone here, that September retail sales were arguably the worst of the year excluding the "abortion" that was the Polar Vortex. The simple reason: after the US consumer loaded up on debt in the spring and the summer, the payback hangover has finally hit with the payment due in the mail resulting in a collapse in revolving credit as reported previously, and as the September retail sales just confirmed:

Headline retail sales: -0.3% missing expectations of a -0.1% decline, and down from the 0.6% in August

Retail sales ex-Autos -0.2%, missing expectations of a +0.2% increase, and down from +0.3%.

Retail sales ex-Autos and gas: -0.1%, missing expectations of a solid 0.4% rebound and down from 0.5%

And not just that: clothing stores dropped -1.2%, sporting goods dropped -0.1%, furniture was down -0.8%, miscellaneous retailers -0.2%, and, sorry Jeff Bezos, online "non-store retailers" such as Amazon declined -1.1%.

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Because nothing screams recovery like the US consumer slamming the spending breaks just as the holiday season begins to unwind.

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Jim Sinclair’s Commentary

Yes! Keep those West African airports open, we can handle it! –CDC

Second Texas healthcare worker diagnosed with Ebola virus
Worker who cared for Thomas Eric Duncan flew on US flight from Cleveland the day before she reported Ebola symptoms
Lauren Gambino in New York
The Guardian, Wednesday 15 October 2014 08.42 EDT

A second healthcare worker who treated Thomas Eric Duncan, the first patient in the US to be diagnosed with Ebola, has tested positive for the virus, escalating the challenge for officials battling to contain it in Texas.

The worker, a nurse at Texas Health Presbyterian hospital in Dallas, was immediately isolated after reporting a fever on Tuesday. Officials on Wednesday said that more cases were a possibility.

The second infection calls into question the Dallas hospital’s ability to protect staff treating Ebola patients, and raises concerns about the quality of the initial response to Duncan’s diagnosis by state and federal agencies. The US Centers for Disease Control and Prevention (CDC) admitted before the latest announcement that it should have sent a bigger team to Dallas in the wake of Duncan’s diagnosis.

“It may get worse before it gets better,” said Dallas mayor Mike Rawlings at a press briefing on Wednesday morning.

The CDC said it was working to confirm of Texas’s preliminary examinations on the new patient.

“An additional healthcare worker testing positive for Ebola is a serious concern, and the CDC has already taken active steps to minimise the risk to healthcare workers and the patient,” it said.

The CDC also said on Wednesday that the new patient had flown on Frontier Airlines flight 1143 from Cleveland, Ohio, to Dallas on 13 October, the day before she reported Ebola symptoms. The flight was the last one of the evening, and the plane was cleaned in Dallas according to normal procedures, which the airline said meets CDC guidelines, before being used again the next day.

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Jim Sinclair’s Commentary

Getting thrown out of your house is only the beginning of your experience of hell. The banksters will chase you to bankruptcy.

Americans face post-foreclosure hell as wages garnished, assets seized
Tue, Oct 14 03:35 AM EDT
By Michelle Conlin

NEW YORK (Reuters) – Many thousands of Americans who lost their homes in the housing bust, but have since begun to rebuild their finances, are suddenly facing a new foreclosure nightmare: debt collectors are chasing them down for the money they still owe by freezing their bank accounts, garnishing their wages and seizing their assets.

By now, banks have usually sold the houses. But the proceeds of those sales were often not enough to cover the amount of the loan, plus penalties, legal bills and fees. The two big government-controlled housing finance companies, Fannie Mae and Freddie Mac, as well as other mortgage players, are increasingly pressing borrowers to pay whatever they still owe on mortgages they defaulted on years ago.

Using a legal tool known as a "deficiency judgment," lenders can ensure that borrowers are haunted by these zombie-like debts for years, and sometimes decades, to come. Before the housing bubble, banks often refrained from seeking deficiency judgments, which were seen as costly and an invitation for bad publicity. Some of the biggest banks still feel that way.

But the housing crisis saddled lenders with more than $1 trillion of foreclosed loans, leading to unprecedented losses. Now, at least some large lenders want their money back, and they figure it’s the perfect time to pursue borrowers: many of those who went through foreclosure have gotten new jobs, paid off old debts and even, in some cases, bought new homes.

"Just because they don’t have the money to pay the entire mortgage, doesn’t mean they don’t have enough for a deficiency judgment," said Florida foreclosure defense attorney Michael Wayslik.

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Greg Hunter interviews John Williams 8-15-14
Reality of No Economic Recovery Means Collapse-John Williams

 

Greece Is In Full-Blown Stock Market Collapse
Joe Weisenthal
Oct. 15, 2014, 8:44 AM

As if the world didn’t have enough to be worried about (ISIS, Ebola, slowing China, Ukraine, slowing Germany, Fed tightening, etc.) now look what’s back: Greece. And in a big way.

The stock market is down over 9% on Wednesday, which is about as big as crashes come.

And the banks are getting absolutely smashed.

Greek banks yikes today. NBG -13%, Piraeus -14%, Alpha -14%, Eurobank -20%.

— Charles Forelle (@charlesforelle) October 15, 2014

Greece, which had been calm for a while, is now being wracked by two separate but related things.

One is the rise in the political popularity of left-winger Alexis Tsipras, the leader of the Syriza party, who if he ever got elected to power would take a much more confrontational stance with the rest of the eurozone with regards to austerity.

Meanwhile, a rift is growing between the current Greek government and the rest of the EU as Greece is keen to exit its bailout program. The EU is not so sure.

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Jim Sinclair’s Commentary

There is more that has faded from MSM and been replaced by Ebola.

Southampton School Closed Wednesday After Enterovirus Case Confirmed
The student does not have the D68 strain that is causing severe respiratory issues for patients throughout the country
Wednesday, Oct 15, 2014 • Updated at 7:02 AM EDT

Officials say they closed an eastern Long Island elementary school after a student was confirmed to have a strain of enterovirus.

Southampton Elementary School was closed Wednesday as a precaution after an unidentified student was diagnosed with the virus, Southampton schools Superintendent Scott Farina said in a statement Tuesday.

The student does not have the D68 strain that is causing severe respiratory issues for patients throughout the country. The student is seeking treatment.

An outside professional cleaning company will disinfect the entire building and apply an anti-bacterial product to prevent the spread of germs.

The school is expected to reopen on Thursday.

More…

CDC Demands 132 Passengers That Flew With 2nd Ebola Patient Report For Testing
Submitted by Tyler Durden on 10/15/2014 11:25 -0400

But, but, but they said it wasn’t contagious unless you came into contact with bodily fluids. According to the CDC, the 2nd health-care worker infected with Ebola traveled on Frontier Flight 1143 from Cleveland to Dallas on October 13th and are asking all 132 passengers on the flight to get tested. One question… what about the thousands of people that those 132 passengers came in contact with in the last 2 days?

NEW TEXAS EBOLA PATIENT FLEW DOMESTICALLY NIGHT BEFORE FEVER APPEARED — CDC

Via Bloomberg,

Second health-care worker with Ebola traveled on Frontier flight 1143 from Cleveland to Dallas on Oct. 13, CDC says in e-mailed statement.

CDC asking 132 passengers on flight to call 1-800-CDC-INFO, plan to begin interviewing passengers about flight, monitoring those who need it

Health-care worker exhibited no signs, symptoms of illness while on flight, according to crew

*  *  *

Frontier Airlines Statement

“At approximately 1:00 a.m. MT on October 15, Frontier was notified by the CDC that a customer traveling on Frontier Airlines flight 1143 Cleveland to Dallas/Fort Worth on Oct. 13 has since tested positive for the Ebola virus. The flight landed in Dallas/Fort Worth at 8:16 p.m. local and remained overnight at the airport having completed its flying for the day at which point the aircraft received a thorough cleaning per our normal procedures which is consistent with CDC guidelines prior to returning to service the next day. It was also cleaned again in Cleveland last night. Previously the customer had traveled from Dallas Fort Worth to Cleveland on Frontier flight 1142 on October 10.

Customer exhibited no symptoms or sign of illness while on flight 1143, according to the crew. Frontier responded immediately upon notification from the CDC by removing the aircraft from service and is working closely with CDC to identify and contact customers who may traveled on flight 1143.

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Jim Sinclair’s Commentary

The USA should adopt these measure because we have change so many metrics anyway.

Italy lifts out of recession thanks to hookers, drugs

Italy learnt it was no longer in a recession on Wednesday thanks to a change in data calculations across the European Union which includes illegal economic activities such as prostitution and drugs in the GDP measure.

Adding illegal revenue from hookers, narcotics and black market cigarettes and alcohol to the eurozone’s third-biggest economy boosted gross domestic product figures.

GDP rose slightly from a 0.1 percent decline for the first quarter to a flat reading, the national institute of statistics said.

Although ISTAT confirmed a 0.2 percent decline for the second quarter, the revision of the first quarter data meant Italy had escaped its third recession in the last six years.

The economy must contract for two consecutive quarters, from output in the previous quarter, for a country to be technically in recession.

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Jim Sinclair’s Commentary

This is a direct result of machines trading the majority of markets. They all tend to think alike, only some think it faster than others.

Liquidity nightmare blamed for crazy market moves
Alex Rosenberg | @CNBCAlex

Investors are blaming an unprecedented lack of liquidity for Wednesday’s gut-wrenching stock market open, which saw the S&P 500 fall as much as 2.2 percent from Tuesday’s close, sent the VIX screaming to 28 and led to outsized moves in major stocks like Disney.

According to Eric Hunsader of Nanex, there were 179 "mini flash crashes" during the first 15 minutes of trading, which is the most since the Knight Capital Group fiasco in August 2012. Additionally, Hunsader reports that there were 68 trades in the S&P e-mini that moved that key futures contract 3 or more ticks. And Treasury futures, too, moved sharply as a result of low liquidity.

The definition that Nanex uses for a mini flash crash is that a stock sees 10 or more down ticks, for a price change exceeding 0.8 percent, within 1.5 seconds

"There was no liquidity at all, so it doesn’t take a whole lot of size to really move the price," Hunsader told CNBC. But "some people come in, and they’re used to buying or selling X-amount, and they’re not paying attention. And X-amount now causes significant movements in price."

When this lack of liquidity collided with a great number of traders willing to get out at any price, markets got ugly.

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Obama Cancels Campaign Trip to Meet With Cabinet on Ebola
By MICHAEL D. SHEAR
OCT. 15, 2014

President Obama on Wednesday canceled his travel to a fund-raiser and a campaign rally so he could convene a meeting of several top cabinet members to coordinate the government’s response to the Ebola outbreak, officials announced.

The decision comes as a second health care worker in Dallas tested positive for Ebola, raising new concerns about the protocols for containing the spread of the deadly virus and heightening fears among the public.

In a statement, the White House said that Mr. Obama would make remarks about the government’s response at the conclusion of the meeting.

Mr. Obama had been scheduled to leave the White House for a fund-raiser in New Jersey before heading to a rally in Connecticut for Governor Dannel P. Malloy on Wednesday evening. The White House said the president’s travel to those events had “been postponed to another day,” but it did not say when the travel would take place.

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Jim Sinclair’s Commentary

For the time being.

Germany to Keep Sanctions Against Russia Despite Economy Slump: Government Spokesman
17:22 15/10/2014

BERLIN, October 15 (RIA Novosti) – German authorities are not considering lifting economic sanctions against Russia despite current economic difficulties, German government spokesperson Steffen Seibert said Wednesday.

"At the moment, we do not have reasons to consider lifting certain sanctions because of the German economy state," Seibert said, adding that the growth of the domestic economy has indeed slowed down recently.

According to the spokesperson, at first, it was necessary to wait for the implementation of all Minsk agreements.

"Since February, we have been trying to find a way to resolve the Ukrainian crisis politically and diplomatically, taking into account the interests of Ukrainian people. The Minsk agreement is in effect and its provisions need to be observed," Seibert said.

He added that lifting sanctions against Iran because of the economic slump in Germany was out of consideration as well.

The West has been introducing sanctions against Russia over its alleged role in escalating the Ukrainian crisis, although Moscow has repeatedly denied these claims. The sanctions at first targeted certain individuals but later spread onto whole sectors of the Russian economy, targeting Russian largest energy and defense companies, as well as financial institutions.

On September 5, the Ukrainian forces and independence supporters of the eastern regions agreed to a ceasefire during a Contact Group meeting in Minsk. On September 19, another round of Minsk talks resulted in the adoption of a memorandum specifying steps for the truce implementation.

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Posted at 2:58 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

Who was sanctioned, Russia or Europe?

EU risks €40bn hemorrhage from Russia sanctions in 2014 – Foreign Minister
Published time: October 14, 2014 07:53
Edited time: October 14, 2014 11:48

Economies across the European Union will lose about €40 billion this year, with the damage estimated to widen to €50 billion in 2015, Russia’s Foreign Minister Sergey Lavrov said, citing figures from the EU itself.

There are so far no exact figures for the damage incurred, but the European Union has made some preliminary estimates and said the damage could be as high as €40 billion this year, Sergey Lavrov said.

The Foreign Minister was addressing a group of business leaders at the Association of European Businesses (AEB), a Moscow-based lobby group that represents the interests of more than 600 European companies in Russia.

Lavrov called for sanctions against Russia that target state-owned companies as well as individuals, to be lifted. Then Russia would cancel the country’s one-year food ban against the EU, a penalty which could cost the EU $6.6 billion in exports.

“Decisions in Brussels, in particular, to impose sanctions against Russia, were made under strong American pressure,” Lavrov said.

More…

 

Jim Sinclair’s Commentary

Could be the boys are so busy in oil they forgot about gold?

What major country benefits the most from a crash in oil? What major country suffers the most from the crash in oil?

Crude Crashing: Brent Is Most. Oversold. EVER
Tyler Durden on 10/14/2014 14:39 -0400

Yesterday we lamented the ridiculously oversold levels in West Texas Intermediate, which as BofA calculated, has hit "oversold" levels for only the third time in six years. We assumed that this could be the basis for a short-term rebound. We were wrong, because we clearly had no idea just how determined the Saudis are to crush Putin into the ground courtesy of plunging oil prices.

As of moments ago, WTI has tumbled nearly $4, some 5%, to just over $81…

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… which just goes to show how idiotic any reliance on charts is in a centrally-planned world, in which commodities are nothing but political weapons. Bottom line: based on its weekly RSI chart, WTI has just hit the most oversold levels since Lehman.

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But to our rather great dismay, what is gong on with Brent turned out to be far worse, and as the weekly RSI indicator shows the selloff in Brent is now the worst, well, ever!

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Jim Sinclair’s Commentary

Sanctions have effects that are not considered when established.

China cashes in on Russia’s shrinking economic options
Putin said China-Russia trade could hit $200 billion by 2020, as Beijing takes advantage of Western pressure on Moscow to cut sweetheart trade and investment deals.
By Fred Weir, Correspondent October 14, 2014

Moscow — The economic synergies between energy-rich Russia and resource-hungry China may appear obvious, but mutual suspicions have long kept them apart.

But now, amid Western sanctions blocking Russian access to European and US capital markets, Russia and China have agreed to new deals that go beyond traditional energy and arms sales – giving Moscow some economic relief at a sweetheart deal forBeijing.

During a three day visit to Moscow that ended Tuesday, Chinese Premier Li Keqiangsigned 38 new deals with Russia, including a big expansion in Russian gas sales to China. Russian President Vladimir Putin sealed a huge $400 billion gas contract with China in May, but the fresh deal would reportedly double that. Moscow also reportedly agreed to sell some of its most advanced weaponry to Beijing.

China-Russia trade has grown from around $40 billion to $90 billion in the past six years, but Mr. Putin said Tuesday that it’s set to jump to $100 billion next year and $200 billion by 2020. By comparison, Russia’s trade with the European Union in 2012 totaled around $340 billion.

It’s a golden opportunity for China to leverage Russia’s political problems with the West and nail down long-term oil and gas contracts at knock-down prices, say experts. "The fact is that China needs energy, and we have it. Russian negotiators are not fools, they know what the bottom line means," says Mr. Salitsky. "What we see is a long-term mutually complementary relationship taking place here, at an accelerated pace."

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Jim Sinclair’s Commentary

This is only if the problem is systemic.

Too-Big-to-Fail Banks Face Up to $870 Billion Capital Gap
By John Glover and Jim Brunsden
Oct 14, 2014 4:13 AM ET

Too big to fail is likely to prove a costly epithet for the world’s biggest banks as regulators demand they increase holdings of debt securities to cover losses should they collapse.

The shortfall facing lenders from JPMorgan Chase & Co. (JPM) to HSBC Holdings Plc could be as much as $870 billion, according to estimates from AllianceBernstein Ltd., or as little as $237 billion forecast by Barclays Plc.

The range is so wide because proposals from the Basel-based Financial Stability Board outline various possibilities for the amount lenders need to have available as a portion of risk-weighted assets. With those holdings in excess of $21 trillion at the lenders most directly affected, small changes to assumptions translate into big numbers.

Too Big to Fail

“The direction is clear and it is clear that we are talking about huge amounts,” said Emil Petrov, who heads the capital solutions group at Nomura International Plc in London. “What is less clear is how we get there. Regulatory timelines will stretch far into the future but how quickly will the market demand full compliance?”

The FSB wants to limit the damage the collapse of a major bank would inflict on the world economy by forcing them to hold debt that can be written down to help recapitalize an insolvent lender. For senior bonds to suffer losses under present rules the institution has to enter bankruptcy, a move that would inflict huge damage on the financial system worldwide if it happened to a global bank.

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Jim Sinclair’s Commentary

It looks like the EU sanctioned itself by mistake.

EU risks €40bn hemorrhage from Russia sanctions in 2014 – Foreign Minister
Published time: October 14, 2014 07:53
Edited time: October 14, 2014 11:48

Economies across the European Union will lose about €40 billion this year, with the damage estimated to widen to €50 billion in 2015, Russia’s Foreign Minister Sergey Lavrov said, citing figures from the EU itself.

There are so far no exact figures for the damage incurred, but the European Union has made some preliminary estimates and said the damage could be as high as €40 billion this year, Sergey Lavrov said.

The Foreign Minister was addressing a group of business leaders at the Association of European Businesses (AEB), a Moscow-based lobby group that represents the interests of more than 600 European companies in Russia.

Lavrov called for sanctions against Russia that target state-owned companies as well as individuals, to be lifted. Then Russia would cancel the country’s one-year food ban against the EU, a penalty which could cost the EU $6.6 billion in exports.

“Decisions in Brussels, in particular, to impose sanctions against Russia, were made under strong American pressure,” Lavrov said.

Russia announced the food ban in August, but only after the West had introduced several rounds of sanctions over the country’s perceived role in the Ukraine crisis.

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Posted at 8:56 AM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

The real story.

Gold firms up on good seasonal offtake amid global cues

Gold prices bounced back at the domestic bullion market today due to renewed buying interest from jewellery traders and retailers ahead of festivities amid buoyant overseas sentiment.

Elsewhere, silver continued its rising trend for the third straight session on the back of heavy demand from industrial users.

Gold is witnessing some momentum and demand is picking up gradually as jewellery stockists and traders are restocking ahead of festivals like Diwali, Dhanteras and for the upcoming wedding season, a bullion trader said.

Standard gold (99.5 purity) moved up by Rs 30 to end at Rs 26,965 per 10 grams from last Saturday’s level of Rs 26,935.

Pure gold (99.9 purity) also added by a similar margin to finish at Rs 27,115 per 10 grams compared to Rs 27,085.

Silver (.999 fineness) jumped by Rs 110 to conclude at Rs 39,470 per kg against against weekend level of Rs 39,360.

On the global front, shiny-metal rallied to a four-week high after speculators turned highly bullish over the precious metal as heightened concerns over faltering global economic outlook amid easing fears of an earlier-than-expected US interest rate hikes, boosting demand for safe haven assets.

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Jim Sinclair’s Commentary

A step forward for the Yuan is a step backwards for the dollar.

Chinese Yuan and US dollar compete in African markets
By Tonderayi Mukeredzi

A number of African central banks are applying to the Chinese Central Bank for currency swaps, with Zimbabwe and Ghana already using the RMB as part of their reserve currency. Nigeria could also shift more of its foreign reserves into Chinese yuan from dollars as the RMB gains greater traction in global trade.

In March this year Zimbabwe joined a growing list of countries in Africa and the world using the Chinese currency, yuan, also known as remnibi (RMB), as one of its official currencies after its central bank added the RMB, the Japanese yen, the Australia dollar and the Indian rupee to the existing basket of currencies.

Zimbabwe abandoned its currency in 2009 when it was rendered worthless by excessive inflation. Since then, it has been using a basket of currencies dominated by the US dollar.

In announcing the decision to adopt the yuan and other currencies, the then Reserve Bank of Zimbabwe acting governor, Charity Dhliwayo, said that the southern African country’s trade and investment with China, India, Japan and Australia "had grown appreciably."

China is Zimbabwe’s third largest trading partner after South Africa and the European Union, and until recently was the biggest buyer of its tobacco. In 2013, trade between China and Zimbabwe amounted to $1.1 billion.

Gift Mugano, a trade expert and executive director at the Nelson Mandela Metropolitan University’s Africa Economic Development Strategies, told Africa Renewal that the addition of the RMB to the basket of currencies would only consolidate Zimbabwe’s bilateral relations with China rather than boost trade, and help China’s quest to make its currency popular.

More…

Dollar drops, global growth concerns spark Fed rate hike rethink

The U.S. dollar fell against a basket of major currencies on Monday on persisting concerns about global economic growth and worries that the Federal Reserve may delay its first interest rate hike.

Concerns over the health of overseas economies continued in the wake of last week’s weak German economic data and the International Monetary Fund’s cut to its global growth forecast.

Meanwhile, Fed officials said on Saturday that a slowdown in the global economy could hamper a tightening of U.S. monetary policy.

Symbol

Price

Change

%Change

=USD

85.19

-0.52

-0.60%

EUR/USD

1.2745

-0.0007

-0.05%

AUD/USD

0.876

-0.0008

-0.09%

JPY/USD

0.935

-0.0005

-0.05%

CHFUSD

1.0543

-0.0003

-0.03%

GBP/USD

1.6072

-0.0011

-0.07%

Fed Vice Chairman Stanley Fischer said at a Saturday event sponsored by the IMF that the global outlook might hamper the effort to normalize U.S. monetary policy after years of extraordinary stimulus.

In addition, Fed Governor Daniel Tarullo said at a conference that he was worried about global growth, while Chicago Fed President Charles Evans said a strengthening of the dollar and weak growth abroad could mean less justification for the Fed to raise rates.

Analysts said the yen, which tends to gain on jitters over global growth, benefited from the dollar’s weakness. They said, however, that they viewed the dollar’s drop as a potential buying opportunity.

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Jim Sinclair’s Commentary

The Fed backtracks after the market breaks. Let see if they really stop QE at the next Fed meeting.

Fed Rate-Rise Odds Pushed Back After Fischer Remarks
By Liz Capo McCormick
October 13, 2014 1:29 PM EDT

Derivative markets show the Federal Reserve won’t raise its target interest rate until after September 2015 as comments from Vice Chairman Stanley Fischer indicated escalating concern about growth outside the U.S.

Derivative markets show the Federal Reserve won’t raise its target interest rate until after September 2015 as comments from Vice Chairman Stanley Fischer indicated escalating concern about growth outside the U.S.

Rates on federal fund futures show the likelihood of a September rate increase fell to 46 percent, down from 56 percent on Oct. 10, and 67 percent two months ago, according to data compiled by Bloomberg. The chance of an increase in October is 56 percent. The implied yield on the December 2015 Eurodollar contract, the world’s most actively traded futures, traded at 0.82 percent, the lowest since May 2013 and down from 1.085 percent a month ago.

“If foreign growth is weaker than anticipated, the consequences for the U.S. economy could lead the Fed to remove accommodation more slowly than otherwise,” Fischer said in an Oct. 11 speech at the International Monetary Fund’s annual meetings in Washington.

“Fischer made it clear that if the biggest economic area in the world is going through trouble, then that will affect the U.S. and impact their forecasts and they won’t tighten so soon,” said Stan Jonas, who has been trading money-market derivatives since Eurodollars futures trading began in 1981, by telephone from New York. “The probability of the Fed’s tightening priced in the market has been moved further out.”

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Jim Sinclair’s Commentary

Remember I suggested you memorize the day Alibaba became public. That is what tops are made of and never occurred in gold.

Manic-Buying Turns To Panic-Selling As ‘Illiquid’ Stocks Plunge To 5-Month Lows
Submitted by Tyler Durden on 10/13/2014 16:01 -0400

Just as we warned, liquidity was incomprehensibly low today (below normal pre-market levels during the peak of the trading day) and the intraday whipsaws were meteoric as a closed cash bond market enabled the slightest twitch in USDJPY to send S&P algos into conniptions. Biotech crashed. Trannies were ripped ridiculously higher at the open – then collapsed into correction (-11% from highs); US Airlines have fallen for 6 straight days, crashing 17% (with today’s 7% plunge – driven by chatter over airborne Ebola – its biggest in over years). Tresury futures implied a notable drop in yields across the curve (10Y -7bps at 2.21%, 30Y 2.97%, and 5Y 1.45%). The USdollar closed -0.33% led by EUR and JPY strength (but AUD surged 1% extending gains after China data).  Gold ($1234), Silver, and copper all gained on the day as WTI fell once again (despite some intraday strength in the middle of the day). Stocks "flash-crashed" on very heavy volume in the last 30 mins with VIX breaking above 24 (highest in 16 months). All major equity indices are now below their 200DMA with the worst 3-day loss since late 2011.

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Liquidity was simply not there – but but but HFTs?

Which meant – just as we warned – epic whipsaws in stocks…

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Jim Sinclair’s Commentary

It isn’t coming. It is already here in the size of their derivative positions, but unrecognized

U.S. and U.K. Officials Meet to Discuss Key Components for the Resolution of a Global Systemically Important Bank

The heads of the Treasuries and leading financial regulatory bodies in the United States and United Kingdom today participated in an exercise designed to further the understanding, communication, and cooperation between U.S. and U.K. authorities in the event of the failure and resolution of a global systemically important bank, or G-SIB.

The event was hosted by Federal Deposit Insurance Corporation Chairman Martin Gruenberg. Additional participants from the United States were Treasury Secretary Jacob J. Lew, Board of Governors of the Federal Reserve System Chair Janet Yellen, Comptroller of the Currency Thomas Curry, U.S. Securities and Exchange Commission Chair Mary Jo White, U.S. Commodity Futures Trading Commission Chairman Timothy Massad, Federal Deposit Insurance Corporation Vice Chairman Thomas Hoenig, Federal Deposit Insurance Corporation Board Member Jeremiah Norton, Federal Reserve Board Governor Daniel Tarullo, Federal Reserve Bank of New York President William Dudley, and Deputy Treasury Secretary Sarah Bloom Raskin.

Participants from the United Kingdom were Chancellor of the Exchequer George Osborne; Bank of England Governor Mark Carney, Deputy Governor for Financial Stability Sir Jon Cunliffe, Deputy Governor for Prudential Regulation and Chief Executive Officer of the Prudential Regulation Authority Andrew Bailey, Deputy Governor for Markets & Banking Minouche Shafik; and Financial Conduct Authority Chief Executive Martin Wheatley.

The exercise’s high level discussion furthered understanding among these principals regarding G-SIB resolution strategies under U.S. and U.K. resolution regimes, aspects of those strategies requiring coordination between U.S. and U.K. authorities, and key challenges to the successful resolution of U.S. and U.K. G-SIBs. This exercise builds on prior bilateral work between U.S. and U.K. authorities, which, since late 2012, has included the publication of a joint paper on G-SIB resolution, participation in detailed simulation exercises for G-SIB resolution, and participation in other joint G-SIB resolution planning efforts.

The exercise demonstrates the continued commitment of the United States and the United Kingdom since the financial crisis to promote a safer and sounder financial system by cooperating to address issues involved in the orderly resolution of large and complex financial institutions without cost to taxpayers. Both countries reiterated their commitment to the Financial Stability Board’s ongoing work concerning G-SIB resolution. The exercise was timed to coincide with the IMF annual meeting.

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Jim Sinclair’s Commentary

The clear and present risk of Ebola is Panic.

State: Don’t bring waste from Ebola victim’s personal items here
WWLTV.com 9:44 p.m. CDT October 12, 2014

BATON ROUGE, La. – State Attorney General Buddy Caldwell is seeking a temporary restraining order to block the disposal of incinerated waste from the Dallas Ebola victim’s personal items and belongings at a Louisiana landfill.

It has been reported that six truckloads of potential Ebola contaminated material collected from the apartment where the Dallas Ebola victim became ill were brought to Port Arthur, Texas on Friday to be processed at the Veolia Environmental Services incinerator. From there the incinerated material is slated to be transported to a hazardous waste landfill in Louisiana for final disposal.

Caldwell said the unknowns involved surrounding the Ebola virus have the state wanting to proceed with caution.

"We certainly share sadness and compassion for those who have lost their lives and loved ones to this terrible virus, but the health and safety of our Louisiana citizens is our top priority," he said. "There are too many unknowns at this point, and it is absurd to transport potentially hazardous Ebola waste across state lines. This situation is certainly unprecedented and we want to approach it with the utmost caution. We just can’t afford to take any risks when it comes to this deadly virus."

The Louisiana Attorney General’s Office said it is in the process of finalizing the application for temporary restraining order and expects it to be filed as early as Monday morning. Additionally, the office is sending a demand letter to Texas state and federal officials, along with private contractors involved seeking additional information into the handling of this waste. Caldwell’s office is in contact with Louisiana health and environmental agencies involved in the matter.

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Jim Sinclair’s Commentary

They put him in a garbage bag.

Suspected Ebola carrier wrapped in plastic after Czech police seal off rail station
Published time: October 13, 2014 10:22
Edited time: October 13, 2014 12:49

Czech police and hazmat suit-wearing doctors have seized a traveler from Ghana at Prague’s main railway station. The man, suspected of suffering from the Ebola virus, was wrapped in black plastic by the authorities and taken away.

The police dispatched some 15 officers from the capital’s rapid response squad to cordon off the station’s lobby, iDNES.cz news website reported. The operation didn’t interrupt the normal operation of the railway station, but probably scared passengers who were in the vicinity.

Footage from the scene showed a man wearing biohazard suit pushing a luggage cart with a person sitting on it almost completely covered by black plastic.

The target of the police operation was a student from Ghana, who arrived in Prague earlier Saturday evening. He managed to get through medical screening at the airport and was caught later at the railway station.

“We took emergency measures after receiving a report that there was a man from Ghana at the station possibly carrying Ebola,” Prague police spokesperson Andrea Zoulová said.

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"Prepare For Runs", IMF Warns Policymakers Of "Elevated Financial Stability & Liquidity Risks"
Submitted by Tyler Durden on 10/12/2014 22:51 -0400

The extended period of monetary accommodation and the accompanying search for yield are leading to credit mispricing and asset price pressures, increasing the chance that financial stability risks could derail the recovery.

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Concerns have shifted to the shadow banking system, especially the growing share of illiquid credit in mutual fund portfolios.

Should asset markets come under stress, an adverse feedback loop between outflows and asset performance could develop, moving markets from a low- to a high-volatility state, with negative implications for emerging market economies.

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Funds investing in credit instruments have a number of features that could result in elevated financial stability risks.

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Jim Sinclair’s Commentary

This is a black swan in itself

ISIS could hold swath from northern Syria to the gates of Baghdad
By Chandrika Narayan, Ben Wedeman and Laura Smith-Spark, CNN
updated 9:55 PM EDT, Sun October 12, 2014

Baghdad (CNN) — ISIS fighters stand on the verge of victory on two fronts as poorly equipped local forces do their best to resist.

The Islamist extremists appear set to take a key Syrian town along the Turkish border and an entire province on Baghdad’s doorstep.

Leaders in Iraq’s Anbar province pleaded for U.S. ground troops to halt the group’s rapid, relentless assault.

On Sunday, the leader of U.S. military efforts to fight ISIS in Iraq says the terror group came within 25 kilometers (15.5 miles) of the Baghdad airport.

Offering what appeared to be previously unreported details, Gen. Martin Dempsey told ABC’s "This Week" that the United States had to risk bringing in low-flying attack helicopters to keep ISIS at bay.

"The tool that was immediately available was the Apache (helicopter). The risk of operating in a hostile environment is there constantly," the chairman of the Joint Chiefs of Staff said.

"You’re not going to wait until they’re climbing over the wall," Dempsey said. "Had (ISIS forces) overrun the Iraqi unit, it was a straight shot to the Baghdad airport. So, we’re not going to let that happen."

ISIS, the self-proclaimed "Islamic State" which also is referred to as ISIL, controls about 80% of the province, said Anbar Provincial Council president Sabah Al-Karhout.

Reports suggest the militants have encircled Haditha, the last large town in Anbar not yet in ISIS’ hands.

In a major setback, Gen. Ahmed Saddak, the police chief of Anbar province, was killed over the weekend in a roadside bomb that targeted his convoy, officials said.

Should all of Anbar fall, the Sunni extremists would rule from the perimeter of Iraq’s capital to Raqqa in Syria, at least, according to the provincial council’s deputy head, Falleh al-Issawi.

They would control a swath 350 miles (563 kilometers) long.

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Jim Sinclair’s Commentary

This time the Governor gave the nurse’s dog a stay of execution.

Blame game begins in US after nurse infected with Ebola
Published time: October 13, 2014 06:03  
Edited time: October 13, 2014 07:38

A leading US health official sparked controversy after saying it is “deeply disturbing” that a Dallas nurse became infected with Ebola while caring for a patient, arguing that many US hospitals are ill-prepared to handle the virus.

In America’s first test case in dealing with Ebola outside of Africa, the US medical community has not performed as well as expected. A female nurse who cared for Thomas Eric Duncan, who arrived in the US last month from Liberia, became the first person to contract the disease inside the United States.

Dr. Tom Frieden, director of the Centers for Disease Control and Prevention (CDC), blamed a break in protocol as the reason for the transmission.

“The healthcare workers who cared for this individual may have had a breach of the same nature,”Frieden said in a press conference Sunday. “It is certainly very concerning and it tells us there is a need to enhance training and make sure protocols are followed. 
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Jim Sinclair’s Commentary

A trend starting to grow.

Chinese Yuan and US dollar compete in African markets
By Tonderayi Mukeredzi

A number of African central banks are applying to the Chinese Central Bank for currency swaps, with Zimbabwe and Ghana already using the RMB as part of their reserve currency. Nigeria could also shift more of its foreign reserves into Chinese yuan from dollars as the RMB gains greater traction in global trade.

In March this year Zimbabwe joined a growing list of countries in Africa and the world using the Chinese currency, yuan, also known as remnibi (RMB), as one of its official currencies after its central bank added the RMB, the Japanese yen, the Australia dollar and the Indian rupee to the existing basket of currencies.

Zimbabwe abandoned its currency in 2009 when it was rendered worthless by excessive inflation. Since then, it has been using a basket of currencies dominated by the US dollar.

In announcing the decision to adopt the yuan and other currencies, the then Reserve Bank of Zimbabwe acting governor, Charity Dhliwayo, said that the southern African country’s trade and investment with China, India, Japan and Australia "had grown appreciably."

China is Zimbabwe’s third largest trading partner after South Africa and the European Union, and until recently was the biggest buyer of its tobacco. In 2013, trade between China and Zimbabwe amounted to $1.1 billion.

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Dallas Hospital Worker Tests Positive For Ebola In First Person-To-Person Transmission On US Soil
Submitted by Tyler Durden on 10/12/2014 08:57 -040

And then there was #2. A few hours ago, Texas Health Presbyterian Hospital, announced that a health care worker who cared for dying Ebola patient Thomas Eric Duncan, has tested positive for the virus after a preliminary test, officials said early Sunday. If confirmed, it would be the first known person-to-person transmission of the disease in the United States. The name of the patients is currently unknown, what is known however, is that the worker was "considered to be at low risk for contracting the virus" and the he or she was wearing full protective gear when treating Duncan, suggesting – yet again – that there is a transmission mechanism which is not accounted for under conventional protocol.

Confirmatory testing of the second case on U.S. soil will be conducted by the Centers for Disease Control and Prevention in Atlanta, the statement from the Texas Department of State Health Services said. 

The worker reported a fever late Friday and was isolated and referred for testing. "We knew a second case could be a reality, and we’ve been preparing for this possibility," said Dr. David Lakey, commissioner of the Texas Department of State Health Services. "We are broadening our team in Dallas and working with extreme diligence to prevent further spread."

Alas, until Friday night, said spread was once again completely uncontained if said worker was able to interact with countless others, who will become symptomatic only after they in turn have spread the disease to an unknown number of their own friends, acquaintances and co-workers.

The statement added that people who had contact with the health care worker after symptoms emerged "will be monitored based on the nature of their interactions and the potential they were exposed to the virus."

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Jim Sinclair’s Commentary

Just getting ready?

U.S. Marines run massive drill to prepare for Ebola pandemic spreading across America
Saturday, October 11, 2014 by: J. D. Heyes

(NaturalNews) A Marine Corps base held a full-scale pandemic outbreak drill within the past week, in which local health officials and U.S. Marine and Navy personnel responded to a mock "smallpox outbreak" that occurred at the installation.

JDNews.com, based in Jacksonville, North Carolina, quoted Lt. Joseph Kotora, public health emergency officer for Naval Hospital Camp Lejeune as saying that the drill, called "Exercise Vigilant Response," was the first of its kind at the legendary Marine Corps recruit training base.

"The drills are usually conducted annually or semi-annually," Kotora told local press. "A drill this size has never been conducted, so this is the largest pandemic exercise to my knowledge."

Though military exercises are planned well in advance, the time of this particular drill has some questioning whether it has anything at all to do with the current Ebola outbreak in West Africa. Though many Americans are tired of reading and hearing about the disease, it became much more of an issue after Thomas Eric Duncan, a West African national, brought the disease to Dallas late last month. Duncan has since died of his infection, but local, state and federal health officials are continuing to monitor dozens of people whom Duncan may have come in contact with while contagious.

One addition to the Camp Lejeune exercise: Officials opted to including the administration of vaccines during the drill so that it would more accurately reflect an outbreak situation in which medical personnel would be asked to screen patients and give inoculations.

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Second US Ebola victim infected despite protective suit
Officials ‘very concerned’ that Dallas hospital worker who contracted the disease while treating the America’s first Ebola casualty was following guidelines for staying safe
By Rosa Prince
3:06PM BST 12 Oct 2014

A Dallas health worker who looked after the first Ebola victim to die in the United States contracted the disease despite wearing a full protective gown, gloves and face shield as she cared for him.

Officials in Texas said they were “very concerned” that the first transmission of the virus on US soil occurred despite following health and safety guidelines.

The female nurse, who has asked not to be named, had been classified as having a “low risk” of carrying the disease before testing positive for Ebola on Saturday night.

Dallas County Judge Clay Jenkins described her as a “heroic person who provided care to Mr Duncan.”

He went on: “This is a person who is going through a great ordeal and so is the family.”

The nurse had cared for Thomas Eric Duncan on the second occasion he attempted to get treatment in the emergency room of the Texas Health Presbyterian Hospital in Dallas.

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War against Isis: US strategy in tatters as militants march on
Patrick Cockburn
Sunday 12 October 2014

World View: American-led air attacks are failing. Jihadis are close to taking Kobani, in Syria – and in Iraq western Baghdad is now under serious threat

America’s plans to fight Islamic State are in ruins as the militant group’s fighters come close to capturing Kobani and have inflicted a heavy defeat on the Iraqi army west of Baghdad.

The US-led air attacks launched against Islamic State (also known as Isis) on 8 August in Iraq and 23 September in Syria have not worked. President Obama’s plan to "degrade and destroy" Islamic State has not even begun to achieve success. In both Syria and Iraq, Isis is expanding its control rather than contracting.

Isis reinforcements have been rushing towards Kobani in the past few days to ensure that they win a decisive victory over the Syrian Kurdish town’s remaining defenders. The group is willing to take heavy casualties in street fighting and from air attacks in order to add to the string of victories it has won in the four months since its forces captured Mosul, the second-largest city in Iraq, on 10 June. Part of the strength of the fundamentalist movement is a sense that there is something inevitable and divinely inspired about its victories, whether it is against superior numbers in Mosul or US airpower at Kobani.

In the face of a likely Isis victory at Kobani, senior US officials have been trying to explain away the failure to save the Syrian Kurds in the town, probably Isis’s toughest opponents in Syria. "Our focus in Syria is in degrading the capacity of [Isis] at its core to project power, to command itself, to sustain itself, to resource itself," said US Deputy National Security Adviser Tony Blinken, in a typical piece of waffle designed to mask defeat. "The tragic reality is that in the course of doing that there are going to be places like Kobani where we may or may not be able to fight effectively."

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Jim Sinclair’s Commentary

It is just around the corner.

World leaders play war games as the next financial crisis looms
Global community can see dark forces gathering but lacks the weapons or the will to tackle them effectively, writes Larry Elliott
Larry Elliott, economics editor
The Guardian, Sunday 12 October 2014 08.24 EDT

Press the uniform. Check the battle plans. Call up the reservists. Arm the bombers and refuel the tanks. Field Marshal George Osborne is going on manoeuvres.

On Monday in Washington, the chancellor of the exchequer will see if Britain is ready for war. A financial war that is. Along with his allies from the United States, he will play out a war game designed to show whether lessons have been learned from the last show, the slump of 2008.

Like all commanding officers, Osborne thinks he is ready. He will have general Mark Carney at his side. He has studied the terrain. He has a plan that he insists will work.

Let’s hope so. Because the evidence from last week’s meeting of the International Monetary Fund in Washington was that it won’t be long before the real shooting starts. The Fund’s annual meeting was like a gathering of international diplomats at the League of Nations in the 1930s. Those attending were desperate to avoid another war but were unsure how to do so. They can see dark forces gathering but lack the weapons or the will to tackle them effectively. There is an uneasy, brooding peace as the world waits to see whether lessons really have been learnt or whether the central bankers, the finance ministers and the international bureaucrats are fighting the last war.

Here’s the situation. The years leading up to the start of the financial crisis in August 2007 were like the Edwardian summer in advance of the first world war. All seemed serene, but only because of an unsustainable build-up in debt. There was a structural shift in power and income share from labour to capital. Rising asset prices compensated for real income growth.

Then came the crisis, which was long and costly. Once it was over, there was a strong urge to return to the world as it was. Countries wanted to return to balanced budgets and normal levels of interest rates, just as they had once hankered after going back on the Gold Standard.

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Jim Sinclair’s Commentary

Now this how money is really made.

Record bust in Cambodia signals Thai dollar counterfeiting boom
BY PRAK CHAN THUL AND ANDREW R.C. MARSHALL
BATTAMBANG Cambodia Sun Oct 12, 2014 6:36pm EDT

(Reuters) – Brigadier General Sar Theth is the police chief of Battambang, a languid riverside town in western Cambodia. You could also call him the seven million dollar man.

On Sept. 19, Sar Theth’s officers tracked three Thai men in a pick-up truck as it passed through a remote border checkpoint from Thailand. When the truck stopped in the Cambodian district of Phnom Proek, the police pounced.

Inside, said Sar Theth, they found three cardboard boxes packed with $7.16 million in counterfeit hundred-dollar bills, the largest seizure of fake U.S. notes in Southeast Asia for about a decade and the biggest ever in Cambodia.

"If I close my eyes and touch it, I wouldn’t know it was fake," he said, rubbing one of the seized notes between thumb and forefinger at Battambang police headquarters.

According to the U.S. Secret Service, whose agents investigate financial crime worldwide alongside their better-known role as presidential bodyguards, the huge bust points to a well-oiled and growing counterfeit operation in neighboring Thailand, where identical notes had previously been seized.

The alleged involvement of Thai military personnel – the three men arrested were serving or former officers of the Royal Thai Navy – could also embarrass Prime Minister Prayuth Chan-ocha. A former general, Prayuth seized power in a May 22 military coup and has vowed to crack down on organized crime.

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Posted at 8:43 AM (CST) by & filed under Jim's Mailbox.

Dear Wolfgang,

The reaction will be in excess of the cause, therefore unlimited intervention is a probability.

Jim

Jim,

The article implies that the Fed will intervene in a market crash and will use whatever it takes to prevent it… $1 trillion, $5 trillion, $20 trillion.

Should this be the case, then we can expect mind boggling numbers for the price of gold.

Which camp are you in? Unlimited intervention, or not?

Thanks,
CIGA Wolfgang Rech

Will The Fed Let The Stock Market Crash Before An Election?
Submitted by Charles Hugh-Smith of OfTwoMinds blog,

Anyone in their position with the tools at hand would not have any other real option other than to buy stocks in whatever quantity is needed to reverse the selling and blow the shorts out of the water.

Since I’m writing this on Sunday evening, if the Dow Jones Industrial Average opens down 1,000 on Monday morning, I’m going to look very foolish. Such is the risk of being contrarian. So what’s contrarian now–expecting a crash or expecting a bounce and rally?

Exactly what the sentiment consensus is right now is open to debate. Analysts expecting a stock market crash see those expecting a rebound as the consensus view.

But if we look at various measures of sentiment such as the Put-Call Ratio and greedometer.com, we find elevated levels of fear over the past few weeks. The consensus can hardly be said to complacent when the VIX index is over 20.

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Jim,

Continued QE?

CIGA Wolfgang

Dear Wolfgang,

Yes , regardless of what new name they give it or by no name.

Regards,
Jim

Fed Officials Say Slow World Growth Could Delay Rate Rise
By Christopher Condon, Jeff Kearns and Ian Katz

Federal Reserve policy makers said a slowdown in the world economy could undermine the U.S. expansion and prompt them to delay raising interest rates.

"If foreign growth is weaker than anticipated, the consequences for the U.S. economy could lead the Fed to remove accommodation more slowly than otherwise," Vice Chairman Stanley Fischer said in a weekend speech at the International Monetary Fund’s annual meetings in Washington.

The remarks, echoed by other Fed officials, highlighted mounting concern about the improving U.S. economy’s ability to withstand foreign weakness and a strengthening dollar. Similar worries last week prompted investors to tip the Standard & Poor’s 500 Index to its weakest level since May and push oil prices into a bear market.

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Jim,

An interesting and formidable stance on the price of gold and its prospects from today on. Article provided courtesy of Monex.

CIGA Wolfgang Rech

From Richard Russell, founder of Dow Theory Letters, in remarks posted on his website on October 6th:

”Gold — I can’t prove it yet but I believe the last decline in gold knocked out the last of the gold bugs and gave gold, technically, a clean slate.  I believe we saw the ultimate bottom of the gold bear market on Friday, and today the whole universe of gold is higher, and closing at its high.  Everything I have said about gold is also true about silver.  I believe this is the time to invest in gold and silver if you have not done so already.  If I am correct, gold should act like the release of a compressed spring.  Gold above 1300 would make me even more certain of my opinion, and gold above 1350 would represent a major buy signal.”

”I believe a new monetary system is in our future.  China and Russiaare combining to move the center of gold activity away from the US.  Who has been buying gold as the faithful dropped out of the picture?  All of the central banks, and particularly China.

The direction of international power has coincided with the flow of gold.  In its frenzy to pressure down the price of gold, the Federal Reserve has handed China a remarkable gift — the gift is cheap gold.  But as of today, I believe we are seeing the process of cheap gold becoming more expensive gold.  I’m betting that within six months physical gold will be scarce and hard to find.  In a sentence, I’m betting that the long bear market is gold has ended.”

Posted at 10:39 PM (CST) by & filed under In The News.

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Russia dumping dollars to use to protect currency and falling oil prices
October 10, 2014 5:33 PM MST

As the United States expands its proxy war against Russia and the BRICS nations through a newly discovered secret deal with Saudi Arabia to force down global oil prices, Russia is firing back to this monetary attack against their currency and economy. On Oct. 10, a new report on Russian currency outflows shows that during the third quarter ending in September, the Eurasian state paid off a near record $53 billion in foreign debt, and sold off dollars to use as capital to stabilize their declining currency, and to protect their primary resource industry from the deflation America has caused through the dumping of excess oil into the market supply.

Some of this money was used earlier this week to support the declining Ruble as President Putin authorized the transfer of over $2 billion to be used directly to support the Russian currency. Additionally, the Russian central bank has already authorized funds to be set aside to supplement Russian corporations and oil industries should the need arise for liquidity and capital.

Despite the reassuring narrative from The West that Russia faces "costs" and is increasingly "isolated" due to sanctions for its actions in Ukraine, the most recent data suggests reality is quite different. First, capital outflows slowed dramatically in Q3 (from $23.7 billion in Q2 to $13 billion in Q3) with September seeing capital inflows for the first time since Sept 2013. Second, Russia’s current account surplus was significantly stronger than expected ($11.4 billion vs $8.8 billion expected) driven by increased trade. Third, and perhaps most crucially, Russia paid down a massive $52.8 billion in foreign debt as Putin "de-dollarizes" at near record pace, reducing external debt to the lowest since 2012. – Zerohedge

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Jim Sinclair’s Commentary

Who took the what?

More details on Fort Carson lockdown; long weekend interrupted
By Tom Roeder Updated: October 10, 2014 at 6:12 pm

The lockdown of a Fort Carson armor battalion dragged into its second day Friday as leaders continued to search for what sources call a lost "sensitive item."

The term refers to gear including weapons, ammunition and night vision goggles – items that cause high-level concern when missing. An undisclosed number of soldiers from the 800-soldier 1st Battalion of the 66th Armor Regiment were confined to unit buildings on Fort Carson during the search for the missing item.

Post officials throughout Friday declined to say what was lost.

"Some government property is missing," 4th Infantry Division spokesman Lt. Col. Armando Hernandez said.

The battalion recently wrapped up a two-week training exercise on the southern side of Fort Carson in which its soldiers packed a full array of gear including heavy machine guns, M-4 rifles, M-9 pistols, night vision goggles and Raven miniature drones. When units return from training they typically inventory gear to ensure that equipment doesn’t end up in the wrong hands.

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China Opposes Western Sanctions Against Russia: Vice Premier
15:47 11/10/2014

MOSCOW, October 11 (RIA Novosti) – During a meeting with Russia’s Deputy Prime Minister Dmitry Rogozin Saturday, China’s Vice Premier Wang Yang stated that the West was wrong in imposing economic sanctions against Russia.

“The city of Sochi reflects the vitality of Russia. Therefore, we came to think that Western countries were wrong in imposing sanctions against Russia,” the Chinese vice premier said, adding that sanctions are “erroneous actions".

“We are certain that despite external factors of instability, the Russian people will be able to show determination and patience to overcome all sorts of current difficulties,” he added, asserting that “China opposes the West’s use of sanctions to exert pressure."

The Russian Deputy Prime Minister and the Chinese Vice Premier met during the 18th session of the Russian–Chinese Commission for the Preparation of Regular Meetings of the Heads of Governments, which is currently taking place in Sochi.

The United States and the European Union have imposed several rounds of sanctions against Russia’s largest banks, energy and defense companies, as well as certain individuals, over Moscow’s alleged involvement in the Ukrainian conflict, a claim Moscow has repeatedly denied.

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Jim Sinclair’s Commentary

This did not take long.

Iraq asks for US ground troops as Isil threaten Baghdad
Islamic State jihadists move within eight miles of the Iraqi capital, sparking calls for America to return to the country
By Alastair Beach
6:18PM BST 11 Oct 2014

Iraqi officials have issued a desperate plea for America to bring US ground troops back to the embattled country, as heavily armed Islamic State militants came within striking distance of Baghdad.

Amid reports that Isil forces have advanced as far as Abu Ghraib, a town that is effectively a suburb of Baghdad, a senior governor claimed up to 10,000 fighters from the movement were now poised to assault the capital.

The warning came from Sabah al-Karhout, president of the provisional council of Anbar Province, the vast desert province to the west of Baghdad that has now largely fallen under jihadist control.

The province’s two main cities, Fallujah and Ramadi, were once known as “the graveyard of the Americans”, and the idea of returning there will not be welcomed by the Pentagon.

But were the province to be controlled by Isil, it would give their forces a springboard from which to mount an all-out assault on Baghdad, where a team of around 1,500 US troops is already acting as mentors to the beleaguered Iraqi army.

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Kobani: time running out for hundreds of besieged civilians
UN warns of possible massacre if town falls after Isis takes control of government buildings
Emma Graham-Harrison in Mursitpinar
The Observer, Saturday 11 October 2014 13.00 EDT

Islamic State (Isis) fighters are closing in on the centre of besieged Kobani, where the Kurdish militia have sworn that they will fight to the death, and hundreds of desperate civilians are trapped in streets rank with the smell of rotting bodies.

The extremist group is trying to cut off the city’s border crossing into Turkey, its last link to the outside world, and penetrate the western enclave where the Kurdish People’s Protection fighters (YPG) are most firmly entrenched. Those units stopped at least five suicide car bombs sent to blast through their last layers of defence in the past two days, activists and politicians inside the city said. But Isis is throwing fighters and ammunition at the exposed road to the border, and if that falls it would be a devastating blow to the Kurdish units.

“If they cut off the border, then everyone inside is going to die,” said activist and journalist Mustafa Abdi, who lived in Kobani until a week ago and edits the website kobanikurd.com.

“Isis can’t walk or shoot their way into the YPG strongholds, but if they can get their car bombs in it will do terrible damage. So far they have stopped them all with rocket-propelled grenades.”

The staunch defence has stemmed, but not stopped, Isis’s brutal advance through the city. On Friday the group took control of the government section of the city, including the main police station and town hall.

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Jim Sinclair’s Commentary

Getting ready for the real thing.

U.S. and UK to test big bank collapse in joint model run
By Randall Palmer and Douwe Miedema
WASHINGTON Fri Oct 10, 2014 6:00pm EDT

Oct 10 (Reuters) – Regulators from the United States and the United Kingdom will get together in a war room next week to see if they can cope with any possible fall-out when the next big bank topples over, the two countries said on Friday.

Treasury Secretary Jack Lew and the UK’s Chancellor of the Exchequer, George Osborne, on Monday will run a joint exercise simulating how they would prop up a large bank with operations in both countries that has landed in trouble.

Also taking part are Federal Reserve Chair Janet Yellen and Bank of England Governor Mark Carney, and the heads of a large number of other regulators, in a meeting hosted by the U.S. Federal Deposit Insurance Corporation.

"We are going to make sure that we can handle an institution that previously would have been regarded as too big to fail. We’re confident that we now have choices that did not exist in the past," Osborne said at the International Monetary Fund’s annual meeting.

Six years after the financial crisis, politicians and regulators around the globe are keen to prove they have created rules that will allow them to let a large bank go under without spending billions in taxpayer dollars.

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Jim Sinclair’s Commentary

Fear of Ebola can be worse than Ebola because everyone will suffer.

From American airliners to British buses, number of Ebola false alarms mounts as panic grows over spread of deadly disease 
By Annabel Grossman for MailOnline

Fears surrounding the spread of Ebola have led to a string of false alarms by people fearing they have caught or been exposed to the killer disease.

As the Centers for Disease Control and Prevention (CDC) attempts to tackle the flood of worried Americans – with more than 800 Ebola false alarms coming in each day – a flurry of incidents have seen Hazmat officers boarding planes.

On the other side of the Atlantic, last night a Liverpool coach station found itself at the centre of an Ebola scare after a female passenger arriving from London collapsed and vomited, with others on the bus seen sprinting from the scene.

Medical staff boarded the coach in protective gear and removed the elderly woman, who is from Africa, wearing a protective garment and face mask.

The woman was taken to Royal Liverpool Hospital where doctors confirmed she did not have the disease. It is understood she was feeling feverish and also had stroke symptoms.

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Posted at 10:27 PM (CST) by & filed under Jim's Mailbox.

Jim,

Waste of time for those well within the safety of the 21 day incubation period. If you’re not sick at the screening you may be later after you mingle in the population for a number of days. Big biological experiment ongoing and we are the mice.

CIGA Dr. K.

New York airport is first in US to screen passengers for Ebola symptoms
Jessica Glenza in New York, David Batty and agencies
theguardian.com, Saturday 11 October 2014 20.14 BST

New York’s JFK airport on Saturday began screening passengers from the west African countries worst affected by Ebola, in an attempt to halt the international spread of the outbreak that has killed more than 4,000 people.

JFK is the first of five US airports to start enhanced screening of passengers from the countries worst hit by Ebola: checks will begin in the next few days at O’Hare in Chicago and at Newark, Washington DC’s Dulles and Atlanta.

Teams equipped with thermal guns will take the temperatures of travellers from Liberia, Sierra Leone and Guinea and ask them questions about their possible exposure to the virus as they enter the US.

“Already there are 100% of the travelers leaving the three infected countries are being screened on exit. Sometimes multiple times temperatures are checked along that process,” Dr Martin Cetron, director of the division of global migration and quarantine for the Centers for Disease Control and Prevention (CDC), said at a Saturday briefing at JFK.

Cetron added: “No matter how many procedures are put into place, we can’t get the risk to zero.”

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Posted at 9:45 AM (CST) by & filed under In The News.

The majority is never right. Never, I tell you! That’s one of these lies in society that no free and intelligent man can ever help rebelling against. Who are the people that make up the biggest proportion of the population — the intelligent ones or the fools? I think we can agree it’s the fools, no matter where you go in this world, it’s the fools that form the overwhelming majority.
– Henrik Ibsen (1828-1906) Norwegian playwright, theatre director, and poet

Jim Sinclair’s Commentary

The barrel might be turning.

- Broad U.S. Economy Is Not Growing 
- Sharp Deterioration Likely Will Continue in Domestic and Global Financial-Market, Economic and Political Stability 
- Confluence of Crises: U.S. Economy, Stocks and Dollar

"No. 664: Market and Economic Instabilities" 
Web-page: http://www.shadowstats.com

Fed Worried About Triggering Another ‘Taper Tantrum’
By Christopher Condon and Jeff Kearns Oct 8, 2014 6:38 PM ET

Federal Reserve officials meeting last month worried that changing their commitment to keep interest rates low for a “considerable time” would shake financial markets, minutes of the gathering show.

“Changes to the forward guidance might be misinterpreted as a signal of a fundamental shift in the stance of policy that could result in an unintended tightening of financial conditions,” according to a record of the Federal Open Market Committee meeting on Sept. 16-17 released today.

Officials opted instead to let their statement “evolve” at an undisclosed pace. Analysts said that although the minutes shed little light on when forward guidance would change, it was clear that officials wanted to avoid repeating missteps from last year.

“This likely reflects the scars from the ‘taper tantrum’ last summer,” when then-Fed Chair Ben Bernanke signaled that asset purchases might be scaled back sooner than investors expected, according to a note to clients from Bank of America Corp. Bernanke’s comments caused a jump in Treasury yields.

Fed officials last month questioned the signal their pledge was sending, and Dallas Fed President Richard Fisher and Philadelphia’s Charles Plosser dissented over the statement.

The meeting explored options on how to replace the forward guidance, including a numerical threshold based on the inflation outlook, as well as relying on quarterly Fed projections for the future path of the benchmark funds rate.

This debate yielded no conclusions on how the Fed would proceed, apart from acknowledging it would be a tricky process.

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Jim Sinclair’s Commentary

It starts small but ends up national.

WOW! Angry Staff at EBOLA HOSPITAL Throw Gloves And Vent RAGE At Spanish PM

 

Jim Sinclair’s Commentary

Civil rights to be suspended in Connecticut.

Public Health Emergency Declared In Connecticut Over Ebola: Civil Rights Suspended Indefinitely
Tyler Durden on 10/10/2014 14:53 -0400

We warned a week ago of the various possibilities surrounding an Ebola outbreak in America, and today we get some degree of confirmation of a medical-based martial-law coming to the US. Governor Dan Malloy has declared a Public Health Emergency in Connecticut, authorizing the "isolation of any individual reasonably believed to have been exposed to the Ebola virus." Simply put, as we noted previously, the State of Public Health Emergency allows bureaucrats to detain and force-vaccinate people without due process – despite not one single case being found in CT. If there is a major Ebola pandemic in America, all of the liberties and the freedoms that you currently enjoy would be gone.

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Jim Sinclair’s Commentary

This is exactly how Pol Pot got started. Isis is going to get increasingly serious in the region.

ISIS encroaches on ultimate prize in Iraq
Oct 10, 2014 12:41 PM EDT

BAGHDAD — Militants of the Islamic State of Iraq and Syria (ISIS) have infiltrated one of Baghdad’s outer suburbs, Abu Ghraib which is only eight miles from the runway perimeter of Baghdad’s international airport.

It’s cause for serious concern now that the Iraqi Defense Ministry has confirmed ISIS has MANPADs, shoulder fired anti-aircraft missiles.

The Iraqi army is still patrolling Abu Ghraib, but they play cat and mouse with the ISIS fighters who stage hit and run attacks on security forces.

It’s a mixed picture around the city. ISIS took over the city of Fallujah — only about 40 miles west of Baghdad — in January, and the Iraqi security forces have fought in vain for a year to force them out.

Instead, and in spite of weeks of U.S.-led airstrikes, ISIS has gradually extended its reach. The extremist group is now either present or in control of a huge swath of countryside, forming a 180-degree arc around the Iraqi capital from due north around to the west, and all the way to the south.

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Jim Sinclair’s Commentary

This would be a massive PR victory for the Yuan. Expect Washington to pull out all the stops on pressure not to have the Yuan in Euro reserves.

ECB Weighing First Step to Buying Yuan for Foreign Reserves
By Stefan Riecher and Jeff Black Oct 10, 2014 1:29 PM ET

The European Central Bank will discuss next week whether to begin laying the groundwork to add the Chinese yuan to its foreign-currency reserves, according to two people with knowledge of the matter.

Governing Council members gathering in Frankfurt for their Oct. 15 mid-month meeting will consider the move, said the people, who asked not to be named because the discussions aren’t public. Should officials eventually decide to buy the currency, initial purchases would be small and might start in a year at the earliest, one of the people said.

Such a measure by the ECB would mark a major step in the internationalization of China’s currency, also known as the renminbi. While China is the world’s second-largest national economy, the yuan isn’t ranked among the most-held foreign reserve assets, according to data from the International Monetary Fund. The U.S. dollar leads at 61 percent of holdings.

The agenda of the Governing Council is confidential, an ECB spokesman said, declining to comment further on the matter.

Speaking in Washington today, former Bundesbank President Axel Weber predicted a greater international role for the yuan.

“The emergence of the renminbi will be a big factor,” he said. “You will have an appreciation of the renminbi.”

The ECB’s push comes against a backdrop of global central bank diplomacy to ease the way for China’s currency, after a series of swap agreements on emergency liquidity.

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Jim Sinclair’s Commentary

There will be Ebola related medical staff problems.

Madrid hospital staff quit over Ebola fears
Carlos III hospital treating virus-hit nurse Teresa Romero Ramos suffers staff shortage amid concerns over training and safety
Ashifa Kassam in Madrid
The Guardian, Friday 10 October 2014 07.12 EDT

Carlos III hospital in Madrid is scrambling to contract extra personnel as worries about lack of training and safety standards have left some staff refusing to attend to possible Ebola cases.

Fourteen people are in quarantine, including four health workers who treated Teresa Romero Ramos, the Spanish nurse who contracted the virus after treating an Ebola patient repatriated from Sierra Leone. Seven people including two hairdressers who had given Romero a beauty treatment before she was diagnosed with Ebola turned themselves in late on Thursday to the isolation unit. None had so far tested positive for the disease except Romero, whose condition was described by the hospital as serious but stable. Her treatment has included injections with antibodies extracted from the blood of Ebola survivors.

While no official numbers were available, Elvira González of the SAE nurses’ union said fear of Ebola had caused some staff to refuse to treat certain patients, while others had resigned their posts.

Amid concerns over inadequate training and safety standards, one health worker told El País newspaper that many staff members were making excuses to avoid work. “They are saying they’ve got their period, that they’re getting dizzy, that they’re claustrophobic … People get anxious and they can’t work like that, being so nervous.”

Others worry about being stigmatised. “Their children aren’t being invited to birthday parties and their friends are cancelling joint vacation plans,” Juan José Cano of Satse, a nursing union member, told El País. “They’ve become known as the Ebola nurses. And it’s not fair.”

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Jim Sinclair’s Commentary

Sanctions blow back. Who is benefiting in the end?

Lebanon to Strengthen Cooperation With Russia: Ambassador
15:43 10/10/2014

MOSCOW, September 10 (RIA Novosti) – Lebanon will continue its long-standing cooperation with Russia, Lebanon’s Ambassador to Russia, Chawki Bou Nassar, said in an interview with RIA Novosti Friday.

"Lebanon supports friendly relations with Russiaon all issues concerning the situation in Arab countries. In 2006, after the Israeli aggression in Lebanon, Russia sent technology to assist in the reconstruction and restoration of Lebanon," Nassar said.

The ambassador noted that Lebanon plans to purchase Russian weapons, using part of the remaining funds it has received from Saudi Arabia. The purchases were discussed during the visit of a Lebanese military delegation to Moscow last week.

"Saudi Arabia has allocated financial aid [to Lebanon]. We will be buying Russian weapons," Nassar said.

According to the ambassador, Lebanon will also be working on developing trade cooperation with Russia, especially in view of the economic sanctions that have been imposed against Moscow by the West.

"Of course Lebanon cannot fill the Russian market with fruits and vegetables [to the full], but we can supply them as a token of support for Russia," Nassar said.

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Russia, UAE considering payments in national currencies
16:22 October 10, 2014 Interfax

Russia and the United Arab Emirates (UAE) are considering making payments in their national currencies, Industry and Trade Minister Denis Manturov and UAE’s Minister of Foreign Affairs Sheikh Abdullah bin Zayed Al Nahyan told journalists after a meeting. "This question was raised today for practically the first time ever, so it requires further review by specialists of both countries. But it has been added to the agenda and is being analyzed," Manturov said. Nahyan said the question of payments in national currencies was complex since the UAE’s currency, the dirham, is very closely connected with the dollar. "This creates added difficulties, but there are ways these difficulties can be overcome. From a political standpoint, the UAE is set on full cooperation with Russia. If there is the political will, then the technical difficulties can be overcome," he said.

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