Posted at 10:28 AM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

Mr. Williams shares the following with us.

- Scheduled for Second-Quarter 2015, Meaningful Benchmark Revisions to Industrial Production Could Be Unusually Large and to the Downside 
- November Industrial Production Jump Encompassed Utilities Surge, Widespread Manufacturing Gains, and Declining Oil and Gas Production 
- Utilities Output Spiked by Unseasonably-Cold Weather 
- Seasonal Adjustments and Revisions Remain Serious Issues 
- Significance of Headline Wholesale Inflation Is Muddled In Ter
ms of Real-World Activity

"No. 681: November Industrial Production, Producer Price Index (PPI)" 


All I Want for Christmas is a (Real) Government Shutdown
Written by Ron Paul
Sunday December 14, 2014

The political class breathed a sigh of relief Saturday when the US Senate averted a government shutdown by passing the $1.1 trillion omnibus spending bill. This year’s omnibus resembles omnibuses of Christmas past in that it was drafted in secret, was full of special interest deals and disguised spending increases, and was voted on before most members could read it.

The debate over the omnibus may have made for entertaining political theater, but the outcome was never in doubt. Most House and Senate members are so terrified of another government shutdown that they would rather vote for a 1,774-page bill they have not read than risk even a one or two-day government shutdown.

Those who voted for the omnibus to avoid a shutdown fail to grasp that the consequences of blindly expanding government are far worse than the consequences of a temporary government shutdown. A short or even long-term government shutdown is a small price to pay to avoid an economic calamity caused by Congress’ failure to reduce spending and debt.

The political class’ shutdown phobia is particularly puzzling because a shutdown only closes 20 percent of the federal government. As the American people learned during the government shutdown of 2013, the country can survive with 20 percent less government.

Instead of panicking over a limited shutdown, a true pro-liberty Congress would be eagerly drawing up plans to permanently close most of the federal government, staring with the Federal Reserve. The Federal Reserve’s inflationary policies not only degrade the average American’s standard of living, they also allow Congress to run up huge deficits. Congress should take the first step toward restoring a sound monetary policy by passing the Audit the Fed bill, so the American people can finally learn the truth about the Fed’s operations.


Jim Sinclair’s Commentary

For our Canadian friends.

Is the CRA creeping your Facebook page?
Fabio Campanella, Special to Financial Post | October 25, 2014 6:30 AM ET

Got a fancy new car? Doing a major renovation to your home? Eating at a lavish new restaurant? Why not let all your friends know what you’re doing by posting this to your social media accounts?

It’s second nature to so many Canadians nowadays to post pics and updates of their daily lives to social media. Generally you’re hoping your friends are following you; secretly you’re hoping they’re envious of the exquisite lifestyle you’re trying to portray. But your friends and followers may not be the only ones peering into your life, the Canada Revenue Agency (CRA) may be checking you out as well.

It’s called: Indirect Verification of Income and it’s an audit technique employed by the CRA. If your lifestyle and reported income don’t match up the CRA may decide to look into your affairs to see what’s actually going on.

So, for example, if you’re driving a luxury car, living in a high-income neighbourhood, sending your kids to private schools, and vacationing in Hawaii’s finest beachfront hotels but only reporting $45,000 of income on your tax return per year then you’re probably a great target for an audit by the CRA.

Open social media accounts are publicly accessible, so if you’re posting pics of yourself whizzing around in your Ferrari and lounging on the beach at a $5,000 per week resort then there’s nothing stopping a CRA auditor from gathering this data from your social media accounts to build a case against you. In fact, several CRA officials have publicly spoken about using taxpayers social media accounts in such a manner.

If you’re audited, and your lifestyle is not in line with the income you report, and you cannot explain the difference, the CRA can assess taxes based on indirect methods of calculating your income. This can lead to taxes owing, severe penalties and interest, and in the most extreme of cases, criminal convictions.


This Time Is The Same: Like The Housing Bubble, The Fed Is Ignoring The Shale Bubble In Plain Sight
by David Stockman • December 8, 2014

We are now far advanced into the third central bank generated bubble of the last two decades, but our monetary politburo has taken no notice whatsoever of its self-evident leading wave. Namely, the massive malinvestments and debt mania in the shale patch.

Call them monetary bourbons. It is no exaggeration to say that inhabitants of the Eccles Building deserve every single word of Talleyrand’s famous epithet: “They learned nothing and forgot nothing.”

To wit, during the last cycle they claimed to be fostering the Great Moderation and permanent full employment prosperity. It didn’t work. When the housing and credit bubble blew-up, it washed out all the phony gains from the Greenspan/Bernanke printing spree. By the time the liquidation was finished in early 2010, there were 2 million fewer payroll jobs than there had been at the turn of the century.


Never mind. The Fed simply doubled-down. Instead of expanding its balance sheet by 50%, as happened during the eight years between 2000 and 2008, it went into monetary warp drive, ballooning its made-from-thin-air liabilities by 5X in only six years. Yet even after Friday’s ballyhooed jobs report there were three million fewer full-time breadwinner jobs in November 2014 than there were in the early 2000s.


Americans are 40% poorer than before the recession
By Quentin Fottrell
Published: Dec 13, 2014 8:07 a.m. ET

The Great Recession is officially over, but Americans are still 40% poorer today than they were in 2007, the year before the global financial crisis.

The net worth of American families — the difference between the values of their assets, including homes and investments, and liabilities — fell to $81,400 in 2013, down slightly from $82,300 in 2010, but a long way off the $135,700 in 2007, according to a new report released on Friday by the nonprofit think-tank Pew Research Center in Washington, D.C.

“The Great Recession, fueled by the crises in the housing and financial markets, was universally hard on the net worth of American families,” the report found.

There is also a dramatic disparity in net worth between races. The median net worth of white households was $141,900 in 2013, down 26% since 2007. It declined by 42% to $13,700 over the same period for Hispanic households and fell by 43% to $11,000 for African-American households. One theory for the wealth gap: White households are more likely than other ethnicities to own stocks directly or indirectly through retirement accounts, the Pew report said.


Bankers Want Your Savings As Part of Their Next Bail-Out
Wed Dec 03, 2014 at 03:27 PM PST

Keep a close eye on what savings you have left. The financial honchos have plans for your money.

Ellen Brown, who writes at The Web of Debt is the only blogger that I am aware of who writes about the neoliberal machinations related to preparing for the next giant bank crashes. In a recent post she describes the latest plan adopted by the G20 nations. I believe this is crucial information for many and so wish to broadcast it further, including some background not covered in her post.

Since the financial crisis of 2008 central bankers and regulators have been busy drawing up plans for avoiding the next bank melt-down. Here in the US, banks considered by the government Too Big To Fail (TBTF) were bailed out six years ago with our tax money on the arguable rationale that if they were permitted to fail, they would take the entire economy down with them. The crisis led to a loud outcry from taxpayers and many savvy experts. They called for a breakup of TBTF banks as the most effective way to avoid future failures and the economic turmoil they engender.

It is no secret that the financial contingent of the Economic Royalists are in the driver’s seat worldwide. We need no more explanation than that to understand why the big banks, like Bank of America, Wells Fargo, JP Morgan Chase, were not broken up, contrary to the public interest. In fact, they are far larger today than they were in 2008, making the TBTF threat worse than ever.

So what plan have the geniuses come up with that both pacifies taxpayers and still saves the TBTF banks? You will be appalled. First, though, some explanation is in order. It is a little known fact that when we put money into a savings account at a bank it is no longer our money. Essentially we have loaned the money to the bank in return for an IOU and some paltry interest. In finance these deposits are referred to as unsecured debt. Theoretically. deposit accounts are insured by the FDIC for up to $250,000. The wrinkle is that the amount of money in the FDIC insurance fund is approximately $25 billion, while the total of deposits at US commercial banks is approximately $9,300 billion, yes that’s $9.3 trillion The failure of just one mega-bank would easily wipe out that fund. Since the FDIC would be unable to keep failing huge banks solvent an alternative is required.


Another Fabricated Jobs Report
Paul Craig Roberts

Dear Friends,

Everything we hear from the US government, the puppet governments of its vassal states, and the presstitute media is a lie. Truth is the declared enemy of the West. Those who try to tell the truth do so at cost to themselves. These costs can range from exclusion and slander to watch lists to prosecution and imprisonment. Brave people like Julian Assange, Edward Snowden, William Binney, and Bradley Manning have paid an extremely high price for standing up for truth against evil.

The question is: Is truth more powerful than the sword or is truth just an inconvenience and a threat to a reassuring life of delusion?

Some readers tell me that having to face the truth saps their confidence in the future.

Others express their disgust with clueless, complacent and willfully ignorant Americans who even if they understood what was going on lack the courage to defend their civil liberties and the truth that is liberty’s foundation. As one put it, “People are victims until they know the truth, but when they learn the truth and remain victims they become volunteers.”

This site is for those who do not want to be deceived by lies and become volunteers.
It is your site. It depends on your support. My enthusiasm is determined by your enthusiasm.

Another Fabricated Jobs Report — Paul Craig Roberts

Update: Tyler Durden points out that income and payroll tax receipts do not support the job claims made for the 2014 economy:


Risks of nuclear war rising because of global tensions and insecure stockpiles, warn experts
Monday 08 December 2014

Urgent action is needed to minimise the risk of a nuclear war, more than 120 senior military, political and diplomatic figures from across the world have warned.

Ahead of the Vienna Conference on the Humanitarian Impact of Nuclear Weapons, which starts today, the experts wrote in a letter that the danger of such a conflict was “underestimated or insufficiently understood” by world leaders.

The signatories include people from across the political spectrum such as former Conservative Defence Secretary Lord King, a Labour counterpart Lord Browne, former Foreign Secretaries Margaret Beckett and David Owen, and former Liberal Democrat leader Sir Menzies Campbell. John McColl, former Nato Deputy Supreme Allied Commander Europe, Lord Richards, former Chief of the Defence Staff, and General James Cartwright, former Vice-Chairman of the US Joint Chiefs of Staff, also signed the letter.


Posted at 5:15 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

Mr. Dude, the ultimate gentleman, takes his Sunday rest.



Sales Of Silver American Eagles Rise To Record High For Second Consecutive Year
Submitted by Tyler Durden on 12/14/2014 14:38 -0500

One month ago, shortly after we reported that "Silver Coin Sales At US Mint Soar To Highest In Two Years" we learned that the "US Mint Sells Out Of Silver Eagles Following "Tremendous" Demand." That, however, did not prevent the mint from selling just about 5 million ounces in the period since the announcement, and as Reuters reported last week, "Strong investor demand lifted American Eagle Silver Bullion coin sales to a record for the second straight year, the U.S. Mint said on Tuesday."

Silver Bullion coin sales have reached 42.9 million coins so far this year, up from the previous record 42.7 million coins last year, the U.S. Mint said in a release. The coin sales on Dec. 8 reached 495,500, lifting them above the 2013 record, the Mint said.

Reuters added that "silver coin sales fell 40.8 percent in November to 3.43 million ounces" which perhaps was to be expected considering the Mint had just sold out of Eagles and the delay associated with coining more and putting them into inventory.

In any event, since the Reuters announcement, another half a million American Eagles have sold direct from the mint, and the total now stands at an even record-er 43.3 million ounces.


For those confused, it is clear that another year of record demand for physical silver explains why the price of silver is down 12.5% in 2014 after being down 36% last year. Why? Because as we said a month ago, "when it comes to precious metals, thanks to the BIS and the central banks, Paper beats Rock every time."


On the Brink of War and Economic Collapse
Paul Craig Roberts

On occasion a reader will ask if I can give readers some good news. The answer is: not unless I lie to you like “your” government and the mainstream media do. If you want faked “good news,” you need to retreat into The Matrix. In exchange for less stress and worry, you will be led unknowingly into financial ruin and nuclear armageddon.

If you want to be forewarned, and possibly prepared, for what “your” government is bringing you, and have some small chance of redirecting the course of events, read and support this site. It is your site. I already know these things. I write for you.

The neoconservatives, a small group of warmongers strongly allied with the military/industrial complex and Israel, gave us Granada and the Contras affair in Nicaragua. President Reagan fired them, and they were prosecuted, but subsequently pardoned by Reagan’s successor, George H.W. Bush.

Ensconced in think tanks and protected by Israeli and military/security complex money, the neoconservatives reemerged in the Clinton administration and engineered the breakup of Yugoslavia, the war against Serbia, and the expansion of NATO to Russia’s borders.

Neoconservatives dominated the George W. Bush regime. They controlled the Pentagon, the National Security Council, the Office of the Vice President, and much else. Neoconservatives gave us 9/11 and its coverup, the invasions of Afghanistan and Iraq, the beginning of the destabilizations of Pakistan and Yemen, the U.S. Africa Command, the invasion of South Ossetia by Georgia, the demise of the anti-ABM Treaty, unconstitutional and illegal spying on American citizens without warrants, loss of constitutional protections, torture, and the unaccountability of the executive branch to law, Congress, and the judiciary. In short, the neoconservatives laid the foundation for dictatorship and for WW III.

The Obama regime held no one accountable for the crimes of the Bush regime, thus creating the precedent that the executive branch is above the law. Instead, the Obama regime prosecuted whistleblowers who told the truth about government crimes.

Neoconservatives remain very influential in the Obama regime. As examples, Obama appointed neoconservative Susan Rice as his National Security Advisor. Obama appointed neoconservative Samantha Power as U.S. Ambassador to the United Nations. Obama appointed neoconservative Victoria Nuland as Assistant Secretary of State. Nuland’s office, working with the CIA and Washington-financed NGOs, organized the U.S. coup in Ukraine.

Neoconservatism is the only extant political ideology. The ideology is “America uber alles.” Neoconservatives believe that History has chosen the United States to exercise hegemony over the world, thereby making the U.S. “exceptional” and “indispensable.” Obama himself has declared as much. This ideology gives neoconservatives tremendous confidence and drive, just as Karl Marx’s conclusion that history had chosen the workers to be the ruling class gave early communists confidence and drive.

This confidence and drive makes the neoconservatives reckless.

To advance their agenda neoconservatives propagandize the populations of the U.S. and Washington’s vassal states. The presstitutes deliver the neoconservatives’ lies to the unsuspecting public: Russia has invaded and annexed Ukrainian provinces; Putin intends to reconstitute the Soviet Empire; Russia is a gangster state without democracy; Russia is a threat to the Baltics, Poland, and all of Europe, necessitating a U.S./NATO military buildup on Russia’s borders; China, a Russian ally, must be militarily contained with new U.S. naval and air bases surrounding China and controlling Chinese sea lanes.

The neoconservatives and President Obama have made it completely clear that the U.S. will not accept Russia and China as sovereign countries with economic and foreign policies independent of the interests of Washington. Russia and China are acceptable only as vassal states, like the UK, Europe, Japan, Canada, and Australia.

Clearly, the neoconservative formula is a formula for the final war.


Jim Sinclair’s Commentary

This is the biggest bomb ever dropped on America.

The riders on this bill are WMD.

US Senate passes $1.1tn spending bill
Vote ends threat of government shutdown and ensures funding for federal agencies until September, but battle over immigration reform postponed
Dan Roberts in Washington
Saturday 13 December 2014 23.13 EST

The $1.1tn US budget finally cleared Congress on Saturday night after hours of last-minute legislative bargaining that secured a number of unexpected wins for Democrats but failed to stop a controversial plan to help Wall Street banks.

The so-called “cromnibus” – a 1,600-page omnibus spending bill that funds most of government until next September – passed in the Senate by 56 to 40 votes. It also postpones a battle over Barack Obama’s immigration reform until March with a separate three-month continuing resolution to fund the Department for Homeland Security.

But a last-ditch effort by conservative senator Ted Cruz to take more immediate action on immigration served to delay the final vote and created a surprise window for Democrats to rush through a series of previously-stalled personnel confirmations.

Cruz scuppered the original plan agreed with his party’s leadership to hold the cromnibus vote on Friday night by insisting there be an opportunity to vote on whether the president’s executive action on immigration was unconstitutional.

This failed, voted down by 22 votes to 74, but the resulting delay allowed outgoing Senate majority leader Harry Reid to use the unexpected Saturday session to hold a 10-hour voting marathon and confirm 24 nominations for vacant judicial posts and government jobs.


Jim Sinclair’s Commentary

A key part of the Great Leveling.

The Devastation Of America’s Working Class
Tyler Durden on 12/12/2014 14:35 -0500

After years of exposing, month after month, the truth about the US labor market – its conversion into a part-time (in 2010!), low-paying job market where Millennials refuse to work (as the job market reality is gruesome so instead they opt to load up on record amount of student loans) and where older Americans, instead of enjoying retirement are forced right back into the labor force leading to record numbers of workers over the age of 55 (thanks to ZIRP crushing the value of their savings and a refusing to participate in an HFT- and central-bank rigged stock market), the mainstream media, having grown tired of spinning the bullshit optimistic propaganda, has finally moved to the "tinfoil" side, and has done something it normally wouldn’t touch with a ten foot pole. Tell the truth.

Enter the NYT with a shocking dose of truthfulness, one which goes to show just one thing: how over the past decade, notwithstanding the tripling of the S&P from its post-Lehman lows on the back of $11 trillion in central bank liquidity, America’s working class has been not only skewed beyond recognition, but is now absolutely devastated. And all thanks to the Federal Reserve skewing the value of money so much that those who should be working aren’t, and those who should be retiring, are serving you Starbucks.


New York Times on Benefits of Gold as Geopolitical Weapon in Currency Wars
Submitted by GoldCore on 12/14/2014 08:47 -0500

New York Times on Benefits of Gold in Currency Wars
The New York Times published an important article this week in which the benefits of gold to nation states during a period of currency wars was highlighted. The article was noteworthy as the New York Times has rarely covered gold in a positive manner.


The article, entitled ‘The Golden Age’ is about the growing use of gold in geopolitical affairs. They drew attention to the gold repatriation movements in Europe and to the accumulation of the precious metals in vast quantities by the central banks of the East – particularly Russia and China.

The Times attempts to get into the mind-set of the central banks who are buying gold or attempting to repatriate their current stocks of the metal. It presents two major rationales for the current trend.

"Some that’ve interpreted the metal’s mini-comeback as an indication that financial Armageddon, in the guise of runaway inflation, is approaching. Others have read the recent move as a symbolic way for central banks and governments to make a show of strength in nervously uncertain economic times."

The first point is one which we have covered here consistently. The article quotes Jim Rickards who interprets the policies of China and Russia as "they understand who fragile things are and they are getting ready for the demise of the dollar."

The Times refers to the unprecedented waves of money printing by central banks in recent years "which in theory can devalue sovereign currencies." Despite the fact that massive money printing programs have always led to high inflation the Times seems to believe that this time it may be different – famous last words in economic terms.

The other side of the argument as put forward by the Times does not really hold water. It suggests that the accumulation of gold is a largely symbolic act . It is being used to induce a "culture of stability."


Posted at 5:08 PM (CST) by & filed under Jim's Mailbox.


It’s all up to the Senate next week. Allow derivative gambling again with depositor funds while at the same time cutting pensions. Think about that a minute. The result of this financial mess that put pensions in trouble was caused by excessive leverage in derivatives. Now Main Street is really going to feel it in the pocketbook. So now we are going to allow a free-for-all in derivative trading and cut main street pensions for the first time in 40 years, and these elected leaders don’t even blush. The most important aspect of this bill is listed near the bottom of this news story.

Congress considers plan to allow pension plans to cut benefits for retirees
By Melanie Hicken December 11, 2014 10:04 AM

Teamsters have started an Internet campaign that opposes proposed legislation that would allow failing multiemployer pension plans to cut benefits. (

More than a million retired and current truck drivers, construction workers and other union workers could see their pension benefits cut if Congress passes a proposal aimed at shoring up some of the nation’s biggest pensions.

Multiemployer pension plans cover more than 10 million workers and retirees in the trucking, manufacturing and other industries. But many of these plans have struggled in the last decade as they grapple with an aging workforce and major investment losses from the recession. Plus, many larger employers have pulled out of the plans.

That has put a major strain on the Pension Benefit Guaranty Corporation, the government agency that insures pension plans, which last month said its reserves are dangerously low.

The Congressional proposal would allow plans that are projected to run out of money in the next 10 to 20 years to cut the benefits they pay to both current and future retirees. Benefits would not be cut for disabled pensioners or those 80 years and older, while cuts would be lessened for those between 75 and 80.


Posted at 12:06 PM (CST) by & filed under General Editorial.

Dear CIGAs,

We are looking for your feedback on where to hold our next Q&A Session. We are currently looking at holding a session in Philadelphia the weekend of January 24th:

We are also looking into holding a session in Chicago in February, and Atlanta in March

If you are interested in attending any of these sessions, please email us at [email protected] and let us know in the subject line which session you are interested in attending.

Thanks for your feedback and we look forward to seeing you there!

Dan Duval
JSMineset Editor

Posted at 2:53 AM (CST) by & filed under General Editorial.

Dear CIGAs,

A lot of questions about Tanzanian Royalty Exploration have been brought up lately. To dispel any lies or to address any concerns you may have, I invite you to call me directly at my office or on my cell. The numbers are as follows:

Office: 844 364 1830
Cell: 860 671 0846

I will be available between 10am-12pm and 1pm-4pm Eastern Standard Time.

Respectfully yours,
Jim Sinclair

Posted at 10:42 AM (CST) by & filed under In The News.



Jim Sinclair’s Commentary

The derivative time bomb was placed in the bill by Republicans. It will make 2008 look like a side show if passed!

House passes full omnibus budget bill despite Democrat revolt – as it happened
Tom McCarthy and Alan Yuhas in New York
Thursday 11 December 2014 22.10 EST

House Speaker John Boehner supported the omnibus bill. Photograph: J. Scott Applewhite/AP


We’re going to end our coverage for the night with a summary of the key events in Congress.

The House passed the “cromnibus” bill to fund the federal government for the next fiscal year, avoiding a government shutdown despite a rebellion by Democrats. The final votes tallied to 219-206.

The Senate has until midnight Saturday to take up the bill, thanks to a short-term resolution passed by the House to give it time. Senator Harry Reid said the chamber could take up the bill as early as Friday.

Democrats spent hours in disarray and angry revolt over the inclusion of two riders added to the bill at the 11th hour, one on campaign contribution limits and the second on finance. Members of the party were particularly enraged by the latter, which would insure derivative trading on Wall Street.

The House voted by unusually emotional speeches from Democrats furious with each other, with representatives decrying big banks and exhausted by gridlock in Congress.

Speaker of the House John Boehner rallied Republicans after a minor spat broke out in his own party, as hard right conservatives argued to use the bill as leverage on immigration.

The White House breathed a sigh of relief as a bill it backed passed with bipartisan support, though division among Democrats portends problems for the remainder of Barack Obama’s presidency.

Senate majority leader Harry Reid has announced that the chamber will take up the omnibus bill tomorrow.


Jim Sinclair’s Commentary

Sounds about right to me on the upside.

What Do They Know? CME Implements Gold, Precious Metals Circuit Breakers Up To $400 Wide
Submitted by Tyler Durden on 12/11/2014 23:43 -0500

With memorandum S-7258, titled "Implementation of New NYMEX/COMEX Rule Regarding Special Price Fluctuation Limits for Certain NYMEX and COMEX Metals Futures and Options Contracts" released moments ago by the CME Group, and set to become effective on December 21, 2014, and which seeks a 5 minute trading halt when "price movements in lead-month primary futures contracts result in triggering events"…  "as a measure that is consistent with promoting price discovery and cash-futures price convergence" in order to "deter sharp price movements that may, for example, be driven by illiquid central limit order books prevailing from time to time in otherwise liquid markets", one wonders why now, and what does the CME know about upcoming volatility, or lack of liquidity, in the precious metals space that nobody else does (and does any of this have to do with the "berserk" algo test from November 25?)?

To wit, from the CME, highlights ours:

Implementation of New NYMEX/COMEX Rule Regarding Special Price Fluctuation Limits for Certain NYMEX and COMEX Metals Futures and Options Contracts


Effective Sunday, December 21, 2014 for trade date Monday, December 22, 2014, and pending all relevant Commodity Futures Trading Commission regulatory review periods, the New York Mercantile Exchange, Inc. (NYMEX) and Commodity Exchange, Inc. (COMEX) (collectively, the Exchanges) will implement new NYMEX/COMEX Rule 589 (Special Price Fluctuation Limits) to apply price fluctuation limits to certain metals futures and options contracts. Price fluctuation limits deter sharp price movements that may, for example, be driven by illiquid central limit order books prevailing from time to time in otherwise liquid markets.

NYMEX currently applies price fluctuation limits to its energy complex of futures and options contracts. These limits are referenced in each contract’s respective NYMEX product rulebook chapter. The Exchanges are proposing new Rule 589 to extend price fluctuation limit functionalities to certain metals futures and options as a measure that is consistent with promoting price discovery and cash-futures price convergence. The operation of new Rule 589 for metals futures and options contracts is described below. The full text of the new rule is set forth in Appendix B. Appendix C provides the specific limit levels for the relevant NYMEX/COMEX contracts to which Rule 589 will apply.

The Operation of New Rule 589 for Metals Futures and Options

At the commencement of each trading day, new Rule 589 will require the Exchanges to determine initial price fluctuation limits as levels above or below the previous day’s settlement price for lead-month primary futures contracts. There are three primary COMEX metals futures contracts and two primary NYMEX metals futures contracts. These contracts have the largest and most liquid metals central limit order books on CME Globex or are considered separate and distinct stand-alone products on an outright basis. The lead-month contract, as determined by the Exchanges, will typically be a primary contract’s most actively traded futures contract month.


Jim Sinclair’s Commentary

Fracking is history at these energy price levels.

Oil price collapse claims WA’s Red Fork Energy, shale gas company in receivership
By Kathryn Diss
Posted yesterday at 12:40pmThu 11 Dec 2014, 12:40pm

The collapse of the oil price has snared its first West Australian victim with Red Fork Energy losing the support of its major lender.

The Perth-based company drills for shale gas in the United States, producing oil and gas.

But, it is completely exposed to the US shale gas industry, which analysts say has become unviable at current oil prices.

The oil price has tumbled 40 per cent in recent months, dragging down the value and margins of oil and gas producers.

Red Fork’s major lender, Guggenheim Corporate Funding, called in the receivers this week.

It has appointed KordaMentha as receiver and Ferrier Hodgson will act as administrator.


Jim Sinclair’s Commentary

A dollar here, a dollar there. Makes no difference according to our leaders.

House Narrowly Passes Bill to Avoid Shutdown; $1.1 Trillion in Spending

WASHINGTON — The House narrowly passed a $1.1 trillion spending package on Thursday that would fund most government operations for the fiscal year after a rancorous debate that reflected the new power held by Republicans and the disarray among Democrats in the aftermath of the midterm elections.

The accord was reached just hours before the midnight deadline, in a 219-206 vote, amid the last-minute brinkmanship and bickering that has come to mark one of Congress’s most polarized — and least productive — eras. The legislation now heads to the Senate, which is expected to pass it in the coming days.

The split in the Democratic Party dramatically burst into view when Representative Nancy Pelosi, the minority leader and one of President Obama’s most loyal supporters, broke with the administration over a provision in the bill that would roll back regulation of the Dodd-Frank Act, which Ms. Pelosi said was a giveaway to big banks whose practices helped fuel the Great Recession. She spoke on the House floor in the early afternoon, expressing her strong opposition to the bill.

Mr. Obama and Vice President Joseph R. Biden Jr. were pressed to make a furious round of phone calls to try to persuade wavering Democrats, while House Speaker John A. Boehner worked to get more Republican votes.

The public support of the sweeping spending bill by the White House — which came just as Ms. Pelosi was making her speech on the House floor opposing it — was a rare public break with the minority leader and infuriated many of her loyalists.


Posted at 5:45 PM (CST) by & filed under In The News.



Austria Considers Repatriating Its Gold
Submitted by Tyler Durden on 12/12/2014 13:11 -0500

And just like that, the list of countries who want to repatriate their gold just increased by one more, because after Venezuela, Germany, the Netherlands, sorry Switzerland, and rumors of Belgium, we now can add Austria to those nations for whom the "6000 year old barbarous relic bubble" is more than just "tradition."

From Bloomberg:

Austrian Central Bank Mulls Relocating London Gold: Standard

The Austrian state audit court says central bank should address concentration risk of storing 80% of its gold reserves with the Bank of England, Standard reports, citing draft audit report. Court advises central bank to diversify storage locations, contract partners.

Austrian central bank reviewing gold storage concept, doesn’t rule out relocating some of its gold from London to Austria: Standard cites unidentified central  ank officials. Austria has 280 tons gold reserves, according to 2013 annual report. Austrian Audit Court Will Review Nation’s Gold Reserves in U.K.

And from (google translated):

The gold reserves of the Oesterreichische Nationalbank (OeNB) and their deposits in the UK and in Switzerland are a recurring theme in political discussions. Especially like the Freedom require relocation to Austria, the example of the Deutsche Bundesbank in mind, who want to move their gold by 2020 half of them to Germany.

In Austria, the Court has adopted in its recent OeNB examination of the issue of gold. In its draft report he gives the OeNB diverse recommendations on the way. One of the key points: Given the "high concentration risk in the Bank of England" advise the examiner to "rapid evaluation of all possibilities of a better dispersion of the storage locations". Not only the parties to be diversified, but it should also come to the "actual spread of the storage locations".


Jim Sinclair’s Commentary

The latest from John Williams’

- November Retail Sales Gain Boosted by Spurious Seasonal Adjustments,0.5% of 0.7% Headline Sales Gain Tied Just to Gasoline-Seasonality Issues
- Irrational Markets Continue as Great Dollar Calamity Nears

"No. 680: November Retail Sales, Financial-Market Distortions"

Jim Sinclair’s Commentary

This was one of the most respected commodity firms when I was a kid.

Crashing Crude’s First Casualty: One-Time Commodities Giant Phibro Liquidating
Tyler Durden on 12/10/2014 09:20 -0500

While we were expecting that one-time "god of crude oil trading" would have a poor year as a result of his consistent bullishness on the crude space, we were quite astounded to learn, as Bloomberg first reported yesterday, that Andy Hall – the man whose name was for a decade legendary in the commodity space -would call it a day. And yet that pales in comparison to the WSJ report overnight than Phibro itself, Andy Hall’s 113 year old employer currently owned by Occidental Petroleum after its sale by Citigroup, would liquidate in the US after it failed to buy a buyer, marking the end of an era.

What is paradoxical, and as we reported yesterday, Hall’s hedge fund Astenbeck, has not done badly in 2014. In fact, it was up another 1.2% in November and was up 7.2% year to date despite a roaring bear market in commodities.

Alas, that is cold comfort for Phibro. As the WSJ reports, "the 113-year-old company, founded in Germany by two scrap-metal dealers, is winding down its U.S. operations after it failed to find a buyer, according to a person familiar with the situation. The sale process for units in London and Singapore continues, the person said. Phibro specialized in physical trading of oil and other raw materials, seeking to profit by moving actual barrels and acting as an intermediary between producers and consumers. The pool of potential buyers for these kinds of operations has dwindled in recent years amid a regulatory crackdown on Wall Street banks’ involvement in these markets."


Jim Sinclair’s Commentary

Algos manipulate not only FX, Algos manipulate everything.

Lawsky Said to Probe Barclays, Deutsche Bank FX Algorithm

New York regulators have found evidence that Barclays Plc (BARC) and Deutsche Bank AG (DBK) may have used algorithms on their trading platforms to manipulate foreign-exchange rates, a person with knowledge of the investigation said.

The practice suggests there may be a systemic problem involving automated tools that goes beyond individuals colluding to rig currency benchmarks and take advantage of less sophisticated clients.

The algorithms’ use is being scrutinized by the New York Department of Financial Services, said the person. The investigators are looking into the practice at each bank and it isn’t clear if there’s a link between the two, according to the person, who asked not to be named because the matter isn’t public. The algorithms were embedded in Barclays’s BARX trading platform and Deutsche Bank’s Autobahn system, according to the person.

The two services provide electronic marketplaces for the banks’ customers to trade currencies. Rather than directly matching one client’s buy order with another’s request to sell, the systems aggregate all requests from the banks’ clients to create prices that are displayed to customers. The banks profit from the spread or the difference in the price at which currency is sold and bought.


Posted at 2:42 PM (CST) by & filed under Jim's Mailbox.


Just noticed this morning’s release of Export Prices.

Down 1.2% after being down 0.8% in the prior month. This trend is unhealthy for industry and the world.

Companies, it appears, are being forced to lower their prices overseas in order to remain competitive, while at the same time, exporting inflation throughout the world.

Chalk it up to an increasingly strengthening dollar.

This will not and cannot last.

CIGA Wolfgang Rech