Posted at 2:56 AM (CST) by & filed under In The News.

DOCUMENT: Homeland Security Predicts Rise of ‘Anti-Government’ Violence

A leaked document from the Department of Homeland Security’s Office of Intelligence and Analysis predicts increased “anti-government violence over the next year.” The document says the inspiration for violence is Cliven Bundy’s Bunkerville standoff with the Bureau of Land Management from earlier in the year.

DHS’s seven-page report entitled Domestic Violent Extremists Pose a Threat to Government Officials and Law Enforcement points to the recent murders of two Las Vegas law enforcement officers as evidence that there is a “growing trend of anti-government violence compared to the previous four years and inspired by perceived government overreach and oppression” and the “perceived victory at Bunkervile” will “likely prompt more violence.”

Bundy’s 20-year legal dispute with the BLM over grazing fees on federal land escalated when the agency attempted to seize his cattle in the beginning of April. An armed stand off between the BLM and supporters of Bundy ensued until the feds backed off before any serious violence erupted and left the 67-year-old rancher’s land.

Jerad and Amanda Miller, a husband and wife who were at the Bundy ranch, later killed three people in Las Vegas, including two police officers, before killing themselves. The two left an ominous note, swastika, and Gadsden flag by the bodies of both officers. Ammon Bundy, son of rancher Cliven Bundy, told theAssociated Press the Millers were not welcome at the Ranch and were kicked out after a few days, calling them “very radical” and that they didn’t “align themselves” with the Bundy’s protest movement.

These incidents that took place in the south and the west since 2010 and that DHS counts as a “surge in militia and lone offender extremists events with anti-government motivations and targets” are: Alaska militia men, Waffle House plot in Georgia, FEAR militia, LAX shooting, XXX Militia Splinter Group, Bunkerville Ranch, Texas Militia plot, Las Vegas shootings.



Ebola outbreak vastly underestimated, WHO says
Agencies call for global response as WHO admits extraordinary measures are needed to contain disease amid rampant fear
Monica Mark in Freetown and Sam Jones
The Guardian, Friday 15 August 2014 13.21 EDT

The magnitude of the Ebola outbreak in west Africa, which has killed more than 1,000 people, has been vastly underestimated and will require “extraordinary measures, on a massive scale” if it is to be contained, the World Health Organisation has warned.

The admission came as Médecins sans Frontières (MSF), the medical charity, said the disease was spreading “faster than we can respond to”, and accused the WHO of being too slow to react.

The outbreak, which is the worst to date, has killed 1,069 people, with 1,975 cases recorded in Guinea, Liberia, Sierra Leone and Nigeria. However, the WHO fears the figures are unreliable.

“Staff at the outbreak sites see evidence that the numbers of reported cases and deaths vastly underestimate the magnitude of the outbreak,” it said.

“WHO is coordinating a massive scaling up of the international response, marshalling support from individual countries, disease control agencies, agencies within the UN system, and others.”

It was using “practical, on-the-ground” intelligence to map the outbreak, pinpoint the areas of ongoing transmission, and decide where health workers and new isolation facilities were most needed.


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Wall St. falls to session lows, Ukraine engages Russia
NEW YORK Fri Aug 15, 2014 11:15am EDT

(Reuters) – U.S. stocks fell to session lows on Friday, erasing earlier gains and dropping in heavy trading, as forces in Ukraine engaged a Russian armored column on Ukrainian soil.

A Ukrainian military spokesman said Ukrainian forces had tracked a Russian armored column after it crossed the border into Ukraine, and that after the engagement, "part of it no longer exists."

Investors have been concerned about the potential fallout to any escalation between the two countries, though recent signs of easing tensions had lifted equities throughout the week.

"If the reports are true that there is an exchange of arms between Russia and Ukraine, that is a setback in the recent calm. It is hard to know how serious this is, but any sustained upturn in violence could lead to a short-term setback," said Jim McDonald, chief investment strategist at Chicago-based Northern Trust Asset Management.

"Still, so far it has not paid to get too defensive."

The Dow Jones industrial average fell 63.19 points or 0.38 percent, to 16,650.39, the S&P 500 lost 4.95 points or 0.25 percent, to 1,950.23 and the Nasdaq Composite dropped 1.97 points or 0.04 percent, to 4,451.04.


It Begins: Ukraine Troops Destroy Part Of "Armed" Russian Convoy, Stocks Crash
Submitted by Tyler Durden on 08/15/2014 15:03 -0400

Things just escalated notably – (Via Bloomberg):




Reuters reports,

Ukrainian artillery destroyed a "significant" part of a Russian armoured column that crossed into Ukraine during the night, President Petro Poroshenko told British Prime Minister David Cameron on Friday, according to the presidential website.

Separately, a Ukrainian military spokesman said Ukrainian forces had tracked the Russian armoured column as soon as it crossed onto Ukrainian soil."Appropriate actions were undertaken and a part of it no longer exists," military spokesman Andriy Lysenko told journalists.

We await Putin’s response…




EU & US Stocks and bond yields (and Ruble) are tumbling, gold rising.

Of course we noted this last night…

As The Guardian reports,


Germany wants “sound and constructive relations” with Russia — Merkel
August 15, 14:11 UTC+4

BERLIN, August 15. /ITAR-TASS/. Germany is interested in building constructive relations with Russia, Chancellor Angela Merkel told the Luebecker Nachrichten newspaper on Friday.

“Germany is highly interested in sound and constructive relations with Russia,” Merkel said.

“As federal chancellor, I have always urged this and will continue doing this,” she said, adding that she was “always ready to continue negotiations” with Russian President Vladimir Putin.


EU sanctons ‘shooting oneself in the foot’ – Hungary PM
Published time: August 15, 2014 11:30

Hungarian Prime Minister Viktor Orban has urged a rethink of the European Union’s sanctions policy towards Russia, saying the measures are like “shooting oneself in the foot.”

“The sanctions policy pursued by the West, that is, ourselves, a necessary consequence of which, has been what the Russians are doing, causes more harm to us than to Russia,” Reuters quotes Orban talking on radio, he added “in politics, this is called shooting oneself in the foot.”

Russia is Hungary’s largest trade partner outside of the EU, with exports worth $3.4 billion in 2013. Also it is highly dependent on Russian energy. Earlier this year Hungary agreed a $13 billion deal with Russian power company Rosatom to expand the country’s only nuclear power plant.

“The EU should not only compensate producers somehow, be they Polish, Slovak, Hungarian or Greek, who now have to suffer losses, but the entire sanctions policy should be reconsidered,” the Hungarian Prime Minister said, saying he is already looking for support to force through changes.

Despite the negative sentiment on Tuesday, Hungary’s Agriculture Ministry stressed the Russian embargo won’t significantly affect the Hungarian economy as the banned products account for less than a third of Hungarian agricultural exports to Russia, being only one percent of total national farming exports.

Despite weak growth in the eastern countries of the EU, Hungary, together with Slovakia and Bulgaria have shown better than expected figures, with 0.8 percent quarterly expansion according to Thursday’s preliminary GDP estimates.


Russia Calls for Ceasefire in East Ukraine to Facilitate Humanitarian Effort
22:42 14/08/2014

MOSCOW, August 14 (RIA Novosti) – Russia’s Foreign Ministry on Thursday called for an immediate ceasefire in violence-torn eastern Ukraine to ensure the safe delivery of humanitarian aid to civilian population suffering amid armed clashes between Kiev-led forces and independence supporters.

"It is necessary to guarantee the security of the upcoming humanitarian mission," the ministry said in a statement.

"We urge the warring sides at this crucial junction to show the political will to alleviate the suffering of the population of the affected region," the statement said.

Russia has sent a convoy of 280 trucks carrying some 2,000 metric tons of humanitarian aid to southeastern Ukraine, including medical supplies, food, sleeping bags and other basic necessities.

According to the International Committee of the Red Cross (ICRC), the convoy is currently in Russia’s southern Rostov region.


Russia Deploys Mobile Border Guard Teams to Border With Ukraine – FSB
15:11 15/08/2014

MOSCOW, August 15 (RIA Novosti) – Russia has deployed mobile teams of border guards to the vicinity of the border with Ukraine, but they are to operate strictly on the Russian side, a spokesman for Russia’s FSB Border Guard Service said Friday.

The spokesman said that residents of the border territories are under threat due to increased numbers of Ukrainian servicemen crossing into Russia and frequent cross-border shelling.

“They [border guard groups] are operating solely on the territory of Russia. In this regard, the reports about a group of Russian servicemen crossing the Russian-Ukrainian border are completely untrue,” the spokesman said.

On Thursday, a number of foreign news agencies reported that a convoy of military vehicles with Russian license plates crossed into Ukraine via the Izvarino border checkpoint. Earlier on Friday, the UNN information agency, citing the Anti-Terrorist Center operating under the Security Service of Ukraine, reported that the reports had been confirmed. According to preliminary accounts of the alleged incident, the vehicles were carrying armed servicemen.

The Ukrainian government has long blamed Russia for funneling heavy equipment, arms and troops across the border with Ukraine to support the independence movement in the country’s eastern regions, a claim Moscow has repeatedly rejected.

Last week, Pengaton spokesman John Kirby said Russia had amassed 10,000 troops on the border with Ukraine. Shortly after, NATO Deputy Secretary General Alexander Vershbow said 20,000 servicemen had already been deployed to the border. NATO spokeswoman Oana Lungescu added later that NATO is concerned that Russia might send troops into eastern Ukraine under the “pretext” of a humanitarian or peacekeeping mission.


Paulson holds onto gold ETF, Soros adds gold miners in quarter
Fri Aug 15, 2014 4:11am IST
By Frank Tang

Aug 14 (Reuters) – Hedge fund Paulson & Co maintained its stake in the world’s biggest gold-backed exchange-traded fund, SPDR Gold Trust, in the second quarter, while Soros Fund Management LLC sharply boosted his investment in gold mining stocks.

Legendary investor George Soros nearly doubled his ownership in a U.S. gold mining companies ETF and initiated new stakes in other gold producers, suggesting the big names in hedge funds continued to have confidence in the yellow metal.

Investors pay close attention to the quarterly filings by notable fund managers because they provide the best insight into whether the so-called smart money has changed its sentiment toward gold as a hedge against inflation and economic uncertainty.

New York-based Paulson & Co, led by longtime gold bull John Paulson, owned around 10.2 million shares in the ETF worth $1.31 billion on June 30, a filing with the U.S. Securities and Exchange Commission showed on Thursday.

That represents a gain of around $45.3 million as the price of gold climbed nearly 3.5 percent in the second quarter. In the first quarter, gold posted a gain of 6.5 percent as funds added gold back to their portfolios after aggressively selling the yellow metal last year.


Aid convoy stops short of border as Russian military vehicles enter Ukraine
Armoured personnel carriers and support vehicles cross the border, while the 280-truck convoy comes to a halt separately
Shaun Walker on the Russia-Ukraine border
The Guardian, Thursday 14 August 2014

The white trucks of humanitarian aid rumbled through Russia in a convoy stretching for miles, moving slowly southwards on the M4 highway, amid a landscape of fertile fields and Ladas stopped at the roadside – their boots overflowing with watermelons for sale.

But, while the trucks came to a halt well short of Ukraine’s border, a different Russian convoy did make the crossing into Ukrainian territory late on Thursday evening.

The Guardian saw a column of 23 armoured personnel carriers, supported by fuel trucks and other logistics vehicles with official Russian military plates, travelling towards the border near the Russian town of Donetsk – about 200km away from Donetsk, Ukraine.

After pausing by the side of the road until nightfall, the convoy crossed into Ukrainian territory, using a rough dirt track and clearly crossing through a gap in a barbed wire fence that demarcates the border. Armed men were visible in the gloom by the border fence as the column moved into Ukraine. Kiev has lost control of its side of the border in this area.

The trucks are unlikely to represent a full-scale official Russian invasion, and it was unclear how far they planned to travel inside Ukrainian territory and how long they would stay. But it was incontrovertible evidence of what Ukraine has long claimed – that Russian troops are active inside its borders.

It was also ironic given the attention to the huge convoy of humanitarian aid that moved slowly southwards on the M4 highway on Thursday. As the convoy moved closer to the stretch of border controlled by pro-Russian rebels it was hard to escape the feeling that Moscow’s aid convoy had the potential to turn into a slow-motion disaster, perhaps even prompting a moment that could push Ukraine and Russia out of the messy conflict fought by proxies into full-blown, open engagement.

According to Moscow, the convoy is a goodwill gesture, packed with much-needed aid for the residents of eastern Ukraine. In Kiev’s view, the convoy is at best a cynical ploy; at worst, a kind of Trojan centipede, winding its way into the country at a border point no longer controlled by Ukrainian forces, the nature of its cargo taken only on trust.


Russia Lets Ukraine Inspect Aid Convoy
Friday August 15, 2014 3:32 AM

KAMENSK-SHAKHTINSKY, Russia (AP) — Russia let Ukrainian officials inspect an aid convoy on Friday and agreed to let the Red Cross distribute the aid around the rebel-held city of Luhansk, easing tensions and dispelling Ukrainian fears that the aid operation is a ruse to get military help to separatist rebels.

In violation of an earlier tentative agreement, Russia had sent the convoy of roughly 200 trucks to a border crossing under the control of pro-Russia separatists, raising the prospect that it could enter Ukraine without being inspected by Ukraine and the Red Cross. Ukraine vowed to use all means necessary to block the convoy in such a scenario, leading to fears of escalation in the conflict.

Adding to the tensions, a dozen Russian armored personnel carriers appeared early Friday near where the trucks were parked for the night, 28 kilometers (17 miles) from the border. Andriy Lysenko, a spokesman for Ukraine’s security council, said some Russian military vehicles crossed into Ukraine — a charge Russia denied.

Despite mutual distrust, the two sides reached an agreement Friday morning, and 41 Ukrainian border guards and 18 customs officials began inspecting the Russian aid at the border crossing, defense officials in Kiev said in a statement. Sergei Astakhov, an assistant to the deputy head of Ukraine’s border guard service, said Red Cross representatives would observe the inspections.

Both sides also said that the aid deliveries themselves would be carried out exclusively by the Red Cross.

Laurent Corbaz, the International Committee of the Red Cross’ director of operations in Europe, described a tentative plan in which the trucks would enter Ukraine with a single Russian driver each — as opposed to the crew of several people currently in each truck — accompanied by a Red Cross worker. In line with Red Cross policy, there would be no military escort, he said.


Jim Sinclair’s Commentary

Maybe it would be better for them to have remained silent.

Ukraine says it has destroyed Russian vehicles that entered territory
In phone call to David Cameron, president appears to confirm reports that Russian armoured carriers had crossed border
Luke Harding and Nicholas Watt, Friday 15 August 2014 12.33 EDT

Ukraine claims to have destroyed Russian military vehicles in the country’s east, a day after a column was spotted moving across the border.

Ukraine’s president, Petro Poroshenko, told David Cameron in a phone call on Friday that a column of Russian armoured vehicles had been destroyed. Russia has denied the vehicles were even in Ukraine.

A statement from Poroshenko’s office said: "The president informed [Cameron] that the information was trustworthy because the majority of those machines [Russian military vehicles] had been eliminated by the Ukrainian artillery at night."

It added: "The president expressed concern over the situation on the border, particularly, over the fact that the inflow of Russian arms and military machines in Ukraine through the open part of the border continued."

The Guardian and Daily Telegraph reported on Thursday that correspondents had seen 23 Russian armoured personnel carriers, supported by fuel trucks and other military logistics vehicles, crossing into Ukrainian territory. It was impossible to verify the destination or ultimate fate of the convoy, or monitor how long it stayed on the other side of the border.

Separately, Nato said it had observed the Russian incursion. "What we have seen last night is the continuation of what we have seen for some time," said the Nato secretary general, Anders Fogh Rasmussen.


Aid convoy to Ukraine faces disruption, may be attacked – Russia
Published time: August 15, 2014 15:18 
Edited time: August 15, 2014 17:18

Moscow has information that the convoy delivering humanitarian aid to eastern Ukraine may be attacked by Kiev’s forces, with the “punitive” Aidar Battalion planning to mine the road that the vehicles will use, the Russian Foreign Ministry says.

On Friday, Moscow accused Ukraine of attempting to disrupt the humanitarian aid convoy now that the preparations for its delivery have reached their final stages and all key issues have been agreed upon.

“We draw attention to the sharp intensification of military actions by Ukrainian forces with the obvious goal to block the route, agreed upon with Kiev, of the humanitarian convoy from the Russia-Ukraine border to Lugansk,” the Foreign Ministry said in a statement.

In Moscow’s view, all this gives the impression that there are people both in Ukraine and abroad who are willing to disrupt the humanitarian mission, even “at the cost of new casualties and destruction.”

“Those nurturing such criminal plans are taking huge responsibility for their consequences,” the ministry said.

Russia sent a convoy of 280 trucks carrying humanitarian aid – such as medical supplies, food, including baby food, sleeping bags and other basic necessities – to conflict-torn southeastern Ukraine on Tuesday. The convoy is currently stuck near the Ukrainian border, and is awaiting final approval from Kiev before moving forward.


Russia Responds: Ukraine Statement On Convoy "Provocation", Seeks To Aggravate Conflict, Drag In Russia
Submitted by Tyler Durden on 08/15/2014 12:52 -0400

All morning we have been waiting for some Russian response to the announced, if so far unconfirmed, attacked by Ukraine on a Russian "military convoy". We got it moments ago. From Bloomberg:




And remember what we said not even an hour ago: "as a reminder this is first and foremost a war of relentless propaganda on all sides", well Russia seems to agree:


Time for the CIA to unleash the YouTube clips. And while we are waiting, perhaps Ukraine can finally release those MH-17 air traffic control recordings its secret police confiscated a month ago, and which the entire world forgot about?


Jim Sinclair’s Commentary

With the European trend moving anti-sanction is this the EU, or Brussels on their own?

EU Threatens New Anti-Russian Sanctions Over Ukraine
19:48 15/08/2014

BRUSSELS, August 15 (RIA Novosti) — Foreign Ministers of the 28-member European Union agreed Friday to consider new sanctions against Russia if Moscow maintains its stance on the Ukrainian crisis, Dutch Foreign Minister Frans Timmermans said.

“We’ve also agreed that if Russia doesn’t change its behavior, further measures might be necessary. It should stop creating havoc in Eastern Ukraine. It’s quite obvious,” Timmermans told reporters after a meeting of EU foreign ministers in Brussels.

At the same time many European politicians note that the sanctions against Russia are detrimental for both sides.

Finnish Prime Minister Alexander Stubb said earlier today that the European Union is unlikely to impose new economic sanctions against Russia.

Last week, Russian President Vladimir Putin signed an order on economic measures to protect the country’s security. The decree banned for a year imports of agricultural and food products from the countries that had imposed sanctions on Russia. The list includes meat, poultry and milk products as well as fruits and vegetables from the United States, the European Union, Canada, Australia and Norway. The embargo does not include infant foods and goods.

The first round of sanctions against Russia was implemented by the United States and the European Union back in March as a response to Crimea’s reunification with Russia following a referendum.

As the Ukrainian crisis escalated, the United States pressed for its Western allies to follow its lead. Switzerland, Canada, Australia and Japan caved in to the US sanctions push and drew up their own blacklists.


US calls for restraint in Ukrainian army’s actions after deadly Donetsk shelling
Published time: August 15, 2014 13:01

The deputy spokesperson for the US Department of State Marie Harf has called restraint on the Ukrainian military’s actions in the east for the first time, following a major shelling of Donetsk that left at least 70 civilians dead.

“We’ve stressed the importance of showing restraint to minimize casualties among the civilian – the local population,” Harf said.

“We’ve called on the Ukrainians to take every step to avoid the local population as they try to free the city from the separatists,” she added.

In July, the US justified the use of airstrikes by the Ukrainian forces, stating that the army “is defending the country.”

Even during the latest briefing, despite the calls for restraint, Harf stressed the US support of Ukrainian authorities.

“We’ve called on them not to use weapons that could increase that. But again, we’re very supportive of the Ukrainians here. It’s a tough fight they’re in, and we do think that the ultimate goal here needs to be these cities not being under the control of the separatists,” she said.

The press briefing came after a heavy shelling in Donetsk that saw more than 80 people killed over the last few days. At least 116 others were wounded.


Jim Sinclair’s Commentary

In times of war there is only one reserve money and that has always been and will again be gold. The brinksmanship we are seeing today is downright terrifying.

Russia seeks safe haven in gold, away from dollar and euro
Published time: August 15, 2014 17:15

Russia is taking steps to ensure that it protects itself from any future dollar or euro sanctions. Moscow boasts the world’s 5th biggest foreign exchange reserves and the 6th largest gold reserves. In total, the assets amount to over $1.5 trillion.

While the West is continuing to try and punish Russia via economic sanctions, the response of the Russian Central Bank has been to diversify away from the euro and dollar – and to buy up more gold.

As the geopolitical situation in Ukraine deteriorates, Russia is moving to protect itself from currency risks associated with the euro and the greenback.

In the first half of 2014, Russia’s Central Bank reduced its foreign currency reserves by 2.5 percent.

“Due to the worsening geopolitical situation, the Central Bank actively redistributed foreign exchange reserves, replacing US Treasury bonds with gold,” Alfa Bank’s chief economist, Natalya Orlova, told Kommersant.

Instead of buying euros and dollars, Russia’s Central Bank is eyeing the Chinese yuan and the Japanese yen.

Boosting currency swaps and bilateral payments with China and other strategic trade partners will continue to bypass the US dollar. Last week, Russia’s and China’s central banks have agreed to increase currency swaps.


Posted at 8:01 AM (CST) by & filed under Jim's Mailbox.


Since when do public officials’ beliefs of a recession supercede actual statistics that depict a recession?

We’ve always known that manipulated numbers by the government can’t be trusted (as shown in this report, where they were changed to quell public outrage), but now not even officials can be trusted(as if they ever were).

This is really sad.

The one thing I’ve come away with, from a centrally planned government, is that now the public can’t plan anything!

CIGA Wolfgang

Canada Releases Atrocious Jobs Data; Then Revises It Above The Highest Estimate Following Public Outcry
Submitted by Tyler Durden on 08/15/2014 09:08 -0400

A week ago, Canada released a jobs number that was a simply put a disaster: instead of creating the 20,000 jobs analysts had expected, the country’s Statistics bureau reported that a tiny 200 had been added in the month of July, following a drop of 9,400K the month before. This promptly led to screams of pain and howls of bloody murder – after all the data is clearly not allowed to show negative trends: as the Globe and Mail reported, National Bank chief economist Stéfane Marion was among the more optimistic forecasters, with an expectation that July will actually show a net gain of 30,000 jobs and who immediately took offense with the report.  "That was mind-boggling,” he said. “These are numbers we don’t see outside recessions. I just don’t believe we’re in a recession, so therefore I would expect the full-time employment numbers to be [higher].”

And sure enough, since one can’t possibly have a recession in a centrally-planned world, just hours after the release, and following the outcry from the cognitive dissonance, Statistics Canada yielded to pressure for a correction and promptly admitted it had made a mistake and was forced to correct its report. However instead of pulling a laughable ISM "seasonal adjustment glitch" excuse, the agency said it failed to count workers who should have been categorized as full-time employees, even though it clearly did count most full-time employees. Just not those that were critical to keep the illusion going.

Which is why this morning it was take two for the Canada jobs print, which was as follows: In July, Canada employment increased 41.7K in July according to Statistics Canada’s second attempt, from -9.4K in prior month. This was about 41K higher than the previous "erroneous" print, and double the original estimate: high enough to make everyone happy. In fact, it was so high, it surpassed the highest range of the forecast, which topped out at 41.4K based on 20 economists.

The biggest variable was in the net change in full time employment, which dropped by -18.1K in July from 33.5K in prior month. This compared to an original print of -59.7K in the "erroneous" number. Offsetting the weak, if revised, full-time jobs number was part time employment which rose 59.9K in July from -43.0K in prior month. Obamacare now in Canada too? The good news, this was "less" than the original part-time report of +60.0K.


Posted at 2:33 PM (CST) by & filed under In The News.

Putin Says The Petrodollar Must Die, "The Dollar Monopoly In Energy Trade Is Damaging Russia’s Economy"
Tyler Durden on 08/14/2014 11:15 -0400

On one hand, despite initial weakness following Europe’s triple-dip red alert, futures declined only to surge higher after some headline or another out of Russia was again spun to suggest imminent Ukraine de-escalation (something which Russia whose only interest is to keep crude prices high, has absolutely zero interest in), perpetuating a rumor which was set off by a Russian media outlet tweet last week that has sent S&P futures over 50 higher in less than a week on… nothing.

On the other, Putin just said the following, which no matter how one spins it, shows precisely how Russia is inclined vis-a-vis future (un-de-counter) escalations.


Reuters adds:

President Vladimir Putin said on Thursday Russia should aim to sell its oil and gas for roubles globally because the dollar monopoly in energy trade was damaging Russia’s economy.

"We should act carefully. At the moment we are trying to agree with some countries to trade in national currencies," Putin said during a visit to the Crimea region, which Moscow annexed from Ukraine earlier this year.

Countries such as China, India, Iran, Brazil, and virtually every other non-insolvent, that is to say "developed, Western" country.

And now, bring on the Russian "isolation" (which is about to push Europe, not Russia, into a triple-dip recession) and further de-escalation.


Rand Paul: We Must Demilitarize the Police
Sen. Rand Paul @SenRandPaul Aug. 14, 2014

If I had been told to get out of the street as a teenager, there would have been a distinct possibility that I might have smarted off. But, I wouldn’t have expected to be shot.

The outrage in Ferguson is understandable—though there is never an excuse for rioting or looting. There is a legitimate role for the police to keep the peace, but there should be a difference between a police response and a military response.

The images and scenes we continue to see in Ferguson resemble war more than traditional police action.

Glenn Reynolds, in Popular Mechanics, recognized the increasing militarization of the police five years ago. In 2009 he wrote:

Soldiers and police are supposed to be different. … Police look inward. They’re supposed to protect their fellow citizens from criminals, and to maintain order with a minimum of force.

It’s the difference between Audie Murphy and Andy Griffith. But nowadays, police are looking, and acting, more like soldiers than cops, with bad consequences. And those who suffer the consequences are usually innocent civilians.


Rockets fired as Israel and Palestine ‘renew ceasefire’
Palestinians and Israelis agree to five day extension of truce, Egyptian Foreign ministry says, but further exchange of rockets reported
By Reuters
6:00AM BST 14 Aug 2014

Israel and Palestinian factions negotiating in Cairo have agreed to extend a truce for five more days to allow them to reach a lasting agreement to end the fighting in Gaza, the head of the Palestinian delegation said.

Azzam Ahmed, a senior Fatah official, told reporters after a day of intense talks mediated by Egyptian intelligence that the Palestinians hoped to reach a final deal in the coming weeks, with Arab and international backing.

An Egyptian Foreign Ministry statement confirmed that a five-day extension to the ceasefire had been agreed.

But within hours more rockets were fired from Gaza, triggering retaliation from the Israelis.

The Israeli military said its air strikes were "targeting terror sites across the Gaza Strip," and these attacks were followed by two more rocket attacks at Israel from Gaza.

Earlier speaking as an existing 72-hour truce expired, Ahmed said that agreement had been reached on many issues but a few key sticking points remain, including on security.

"I say yes, there was progress and agreement on many of the sticking points," said Ahmed. "We hope that when we return in five days, this will be the final period to announce an agreement … for a permanent ceasefire that ends the aggression against Gaza."

The Palestinian team expects to head to Ramallah on Thursday for consultations with Fatah leader Mahmoud Abbas, before returning to Egypt on Saturday to resume talks, several Palestinian officials said.


Posted at 8:19 AM (CST) by & filed under Jim's Mailbox.

Jim Sinclair’s Commentary

Long Island, NY this afternoon compliments of Ciga B. Thomas after her rescue.



Just another failure of the American sanctions effort.

CIGA Craig

With Natural Gas Byproduct, Iran Sidesteps Sanctions

Iran is finding a way around Western sanctions to export increasing amounts of an ultralight oil to China and other Asian markets, expanding the value of its trade by potentially billions of dollars a year.

The exports come during a slight thaw in Iran’s relations with the West as negotiations over its nuclear program continue, and energy experts say it is counting on the United States and Europe to tolerate an increasing export stream.

According to Iranian customs data, the country in recent months has exported 525,000 barrels a day of the ultralight oil, known as condensates, over two times more than it did a year ago. In the last three months, the sales have generated as much as $1.5 billion in extra trade — a rate of about $6 billion a year — based on Iranian trade figures and market prices, analysts said.

The result has been an overall increase in petroleum shipments to China and other Asian markets without violating the letter of the sanctions. American officials have aimed to keep Iranian oil exports at around one million barrels a day, but when combined with condensate sales, they averaged 1.4 million barrels a day between January and May, according to the Energy Department.



For months, every news outlet in the West was demonizing and threatening Russia and Putin personally. No matter if I looked at the German Bild or Der Spiegel, British Telegraph or Daily Mail, Dutch newspapers and TV, France and of course the US.

Like I said a couple of days ago, it looked like the tone of the messengers has changed. No more threatening about Phase 3 sanctions from politicians, and therefore a different tone from their propaganda news outlets. Even the powerful German Handelsblatt had a very strong and realistic article that the Western news media were taking the wrong path with their threatening and demonizing. On TV and in the news media they now even show destroyed houses in Eastern Ukraine which they didn’t do before and completely ignored the damage and humanitarian disaster over there.

But all this after Putin showed his teeth very strongly only once, with 1 sanction, the food ban. I didn’t hear or see anything anymore from Brussels about retaliation against Russia. Maybe it’s silence before the storm but I think that Brussels doesn’t know what happened to them and they don’t have a plan B to tackle this problem.

The EU and US must have thought that if they arranged a coup in the Ukraine and threatened Russia with sanctions that Russia would only think about their economy and wouldn’t do anything. The EU thought they just had to give a couple of dollars to the Ukraine and everything would have been fine and Ukraine would be in the Western sphere.

They never expected that Russia would right away take Crimea. They also find out how bankrupt, corrupt and crazy the Kiev politicians really are. Instead of having to give a couple of billion, the Ukraine needs tens of billions, it’s a black hole, plus they’re destroying their own country and even threatening to stop the gas transit from Russia to the EU. Besides that the EU never thought that their economies would be hurt by Russian sanctions.

If somebody thinks that his opponent is weak because he keeps quiet then people have the tendency to become overconfident, thinking that silence is weakness. I learned one thing in the past with my karate lessons, never underestimate your opponent, no matter how small and thin they’re looking.

CIGA Richard

Danish Bank Says EU May Soon Lift Sanctions on Russia

MOSCOW, August 13 (RIA Novosti) – The European Union will lift the sanctions it has imposed on Russia over the situation in Ukraine in one to three months, according to research conducted by the Danske Bank.

“We believe an escalating trade war would be unbearable for both Russia and the EU and that the EU will revoke the sanctions within one to three months,” the bank said in a report released Tuesday, adding that Russia will also lift the trade restrictions it has imposed on Europe.

According to the analysis, the Ukrainian crisis will only have a “modest” direct impact on the European economy. Of the Nordic countries, Finland was named the most vulnerable due to its trade, tourism and foreign direct investments links with Russia. However, Norway’s economy might even strengthen due to the potential EU gas substitution from Russia toward the country.

The report suggests that it is highly unlikely that the European sanctions will be able to influence the current political situation in Russia, as support for President Vladimir Putin inside the country is currently “very strong.” It also notes that Russia is currently strengthening its ties with its Latin American and Asian partners.

Danske Bank is the part of the Danske Bank Group, the largest bank in Europe and one of the leading financial organizations in Europe. Danske Bank Group is headquartered in Copenhagen.


Germany wants to continue talks with Russia despite sanctions
August 13, 12:23 UTC+4

BERLIN, August 13. /ITAR-TASS/. German Chancellor Angela Merkel has called to continue negotiations with Russian President Vladimir Putin despite Western sanctions on Russia to settle crisis in Ukraine, the Saechsische Zeitung newspaper said on Wednesday.

“I am trying very much not to break off negotiations with the Russian president despite sanctions,” Merkel told the paper, adding that she had always urged constructive dialogue with Moscow and was ready to continue it.

Speaking of Berlin’s position on affairs in Ukraine, the chancellor said: “One of the EU’s fundamental principles is that we, the Europeans, respect territorial integrity of our states, and that we do not change borders unilaterally.”

Ukraine should be able “to make its own free and democratic decisions” about the country’s constitution and policy, and the degree of independence of Ukraine’s eastern regions, Merkel said. “Russia should also accept it,” she added.



"Surprise, surprise, surprise" as Gomer Pyle would say!

Despite so called consumer confidence, we are still relentlessly mired in an economic malaise, requiring further monetary stimulus. The only opportunity I see here is a “Golden” opportunity.

“Economists and analysts have been waiting for July’s retail sales numbers since July 29, when the Conference Board reported that consumer confidence hit 90.9, nearly a seven-year high. Economists have been waiting to see if the uptick in optimism is filtering through the general economy.”

Fat Chance!

CIGA Wolfgang Rech

U.S. Advance Retail Sales Flat In July
By Kitco News
Wednesday August 13, 2014 8:30 AM

Editor’s Note: The article was updated to include comments from CIBC.

(Kitco News) – Despite feeling more optimistic, consumers continued to hold on to their money last month, according to data from the U.S. Census Bureau.

On Wednesday, the bureau said advance July retail sales were $439.8 billion, "vitually unchanged", on a seasonally adjusted basis, compared to June’s increase of 0.2%. The report also said that total sales from May through July were up 4.2%, compared to the same period last year.

According to consensus reports, economists were expecting retail sales to increase between 0.2% and 0.3%.



Macy’s has always been the stalwart of retail. This is truly unexpected.

The new saying should be “as goes Macy’s, so goes the economy.”

I guess the money printing will never stop.

CIGA Wolfgang Rech

Macy’s cuts same-store sales forecast, shares drop

Aug 13 (Reuters) – Macy’s Inc cut its full-year same-store sales forecast, after second-quarter sales failed to make up for weakness in the first quarter when harsh weather kept shoppers away.

Macy’s earnings for the quarter ended Aug. 2 also missed the average analyst estimate.

"…Many customers still are not feeling comfortable about spending more in an uncertain economic environment," Chief Executive Terry Lundgren said in a statement on Wednesday.

Shares of the company, which also owns the high-end Bloomingdale’s chain, were down 5 percent in premarket trading.

Macy’s said it expects same-store sales to increase 1.5 percent to 2 percent for the full year. It had earlier forecast an increase of 2.5 percent to 3 percent.


Posted at 8:18 AM (CST) by & filed under In The News.

Dear CIGAs,

Here is my CCO today watching the rain clouds approach. Either God is angry, or some mad scientist made it rain an entire summer’s normal rain in 6 hours.


Jim Sinclair’s Commentary

John Williams shares the following with us.

- Headline July Retail Sales Were Boosted to “Unchanged,” Thanks to Downside Prior-Period Revisions 
- Net of Inflation, Real July Sales Likely Fell for Second Month 
- Real July Sales Were Below Second-Quarter Average 
- Consumer Liquidity Remains Structurally Impaired

"No. 649: July 2014 Retail Sales, Consumer Liquidity"

Jim Sinclair’s Commentary

ISIS can buy its way to victory according to this article.

Islamic State Likely World’s Richest Terrorist Group – Reports
17:02 13/08/2014

MOSCOW, August 13 (RIA Novosti) – The Islamic State (IS) is likely the world’s wealthiest terrorist organization thanks to a large-scale racketing scheme that the organization has adopted in the 1990s, Yahoo Finance reported.

“ISIS [IS] has always been a very wealthy terrorist movement because it’s been running very large scale Mafiosi protection rackets all across Iraq for around five years now,” Yahoo Finance quoted Washington Institute’s fellow Michael Knights as saying.

Knights, who has been studying Iraq since the 1990s, estimates the Sunni group makes $2 million to $4 million per day. Reports of bank robbing are a disproved exaggeration according to Knights, and the real money is coming from oil operations.

The IS is running a cross-border oil export business which moves 30,000 to 40,000 barrels a day.

“They will take Iraqi-produced oil, take it to Syria, refine it and then export it via truck out of Turkey or even through Iran,” Knights said.

Despite IS’ lucrative operations, oil prices are not expected to increase globally, according to Yahoo Finance. Knights commented that southern Iraqi oil is protected due to its physical distance from the Islamic State, as well as the Shiite population surrounding the area.

According to The Washington Post, the jihadist group is operating more and more like a de facto state, governing the large amount of land across Syria and northern Iraq.


Jim Sinclair’s Commentary

This is not going away easily.

Islamic State supporters leaflet Central London, declaring ‘dawn of a new era’
Published time: August 13, 2014 11:41

Supporters of the extreme militant group, Islamic State (formerly ISIS), handed out leaflets in central London calling on Muslims to pledge religious allegiance to their cause, witnesses say.

One flyer circulated by the fundamentalists on Monday reportedly urges Muslims to “spread the Khalifah [Caliphate] across the world” by creating a new Islamic State ruled by an Imam under Sharia law.

Asma Al-Kufaishi, a young British-Iraqi student, tweeted pictures of the incident, which occurred near London’s busy Oxford Circus shopping district. The pictures reveal the group displaying posters donning pro-Islamic State black flags.

Al-Kufaishi claims the men who were “promoting ISIS on Oxford Street” were racially abusive when she encountered them Monday. “They don’t know true Islam,” she said.

The leaflets dispensed by the Islamic State supporters argue it’s the responsibility of followers of Islam around the globe to pledge devout allegiance to the “Khaleef” – or head of a new Islamic State.

In the wake of extreme violence, the Islamic State now controls extensive parts of Syria and northern Iraq. Fundamentalist IS militants also recently clashed with forces in Lebanon following their efforts to annex a border town in the state. The militants’ strategy failed, however, as Lebanese authorities regained control over the region.

The director of the Quilliam Foundation, a counter-extremism London think tank, believes the men dispensing IS flyers hailed from Luton in Bedfordshire. They were potentially linked to a UK-based sect of al-Muhajiroun fundamentalists, he claims.


UN Says Ukraine Death Toll Doubles In 2 Weeks To At Least 2,086 In ‘Clear Escalating Trend’
Canadian Press DataFile
Wednesday August 13, 2014 10:47 AM

GENEVA – The U.N.’s human rights office says the number of people who have been killed in eastern Ukraine appears to have doubled in the last two weeks.

A spokeswoman for the office, Cecile Pouilly, says the U.N.’s "very conservative estimates" show the death toll has risen to at least 2,086 people as of Aug. 10 from 1,129 on July 26.

She said in a statement Wednesday that at least 4,953 others have been wounded in the fighting since mid-April.

Pouilly says that on average more than 60 people a day have been killed or wounded as part of "a clear escalating trend" of violence.

The totals reflect Ukrainian armed forces, civilians and armed groups.


Jim Sinclair’s Commentary

Trouble in paradise?

Obama Donors Embrace Tax-Skirting Offshore Mergers the President Slams
By Richard Rubin and Annie Linskey

President Barack Obama has been bashing companies that pursue offshore mergers to reduce taxes. He hasn’t talked about the people behind the deals — some of whom are his biggest donors.

Executives, advisers and directors involved in some of the tax-cutting transactions include Blair Effron, an investment banker who hosted Obama for a May fundraiser at his two-level, 9,000-square-foot apartment on Manhattan’s Upper East Side.

Others are Jim Rogers, co-chairman of the host committee for the 2012 Democratic National Convention; Roger Altman, a former senior Treasury Department official who raised at least $200,000 for Obama’s re-election campaign; and Shantanu Narayen, who sits on the president’s management advisory board.

The administration’s connections to more than 20 donors associated with the transactions are causing tensions for the president as he urges Congress to act against the deals and prods the Treasury Department for short-term steps to curb them. The president’s tough talk also may become a liability as Democrats seek corporate America’s cash this year as they try to preserve their majority in the U.S. Senate.


Militants’ Siege on Mountain in Iraq Is Over, Pentagon Says
AUG. 13, 2014

WASHINGTON — Defense Department officials said late Wednesday that United States airstrikes and Kurdish fighters had broken the Islamic militants’ siege of Mount Sinjar, allowing thousands of the Yazidis trapped there to escape.

An initial report from about a dozen Marines and Special Operations forces who arrived on Tuesday and spent 24 hours on the northern Iraqi mountain said that “the situation is much more manageable,” a senior Defense official said in an interview.

Defense Secretary Chuck Hagel, speaking to reporters Wednesday night at Andrews Air Force Base, Md., said it was “far less likely now” that the United States would undertake a rescue mission because the assessment team reported far fewer Yazidis on the mountain than expected, and that those still there were in relatively good condition.

Rear Adm. John Kirby, the Pentagon press secretary, credited American airstrikes and humanitarian airdrops as well as efforts of the Kurdish pesh merga fighters in allowing “thousands of Yazidis to evacuate from the mountain each night over the last several days” and to escape the militants from the Islamic State in Iraq and Syria.


Jim Sinclair’s Commentary

I suspect the newest game being played here, there and everywhere is changing the metrics of how the GDP is measured to make it read better. Maybe Mexico will add the drug cartels and get it to 4%. The Italians have.

Mexico Central Bank Lowers Growth Forecast on Weak Recovery
By Eric Martin and Brendan Case Aug 13, 2014 12:37 PM MT

Mexican policy makers lowered their 2014 growth forecast for the third time as Latin America’s second-largest economy struggles to bolster consumer sentiment and spending. The peso erased its gain.

Gross domestic product will rise 2 percent to 2.8 percent this year, down from the previous forecast of 2.3 percent to 3.3 percent, the central bank said in its quarterly inflation report today. The forecast for next year was left unchanged at 3.2 percent to 4.2 percent.

In a 45-minute presentation, Banco de Mexico Governor Agustin Carstens said that the central bank doesn’t see growth pressuring inflation and expects the pace of consumer-price increases to slow to near 3 percent early next year. Mexico’s recovery is being fueled by external demand and exports, with indicators of domestic demand such as consumer confidence remaining weak, Carstens said.

“Despite the economic reactivation, the level of slack in the economy is greater than anticipated in the previous report,” policy makers said today. “While we expect the output gap to narrow, it will probably remain in negative territory until the end of 2015.”

While the U.S. has room to maintain loose monetary policy, the day is approaching when the Federal Reserve will need to change its tone as the nation’s economy recovers, Carstens said.

The peso erased its gain after the central bank report, trading little changed at 13.1349 per dollar at 2:29 p.m. in Mexico City after earlier gaining as much as 0.3 percent.


Jim Sinclair’s Commentary

You know World War III may have already started.

The Iraq War Officially Begins: US Troops Prepare For Rollout As US Drones Strike ISIS Positions
Submitted by Tyler Durden on 08/13/2014 16:42 -0400

U.S. military officials say an armed American MQ-1 Predator drone has attacked and destroyed a mortar position of Islamic militants in northern Iraq. As WaPo reports, the drone attack marks a departure for the U.S. military, which had said previously that drones were flying missions over Iraq only to collect intelligence. No boots hit the ground in the carrying out of this action…
As NBC reports,

An American MQ-1 drone strike took out a firing position that Islamic militants used to target Kurdish forces in northern Iraq, according to the U.S. military.

The military said in a statement that a U.S. drone struck and destroyed an ISIS mortar position at around 7:55 a.m. ET on Tuesday.

The mortar position was firing on Kurdish forces defending members of the Iraq’s Yazidi religious minority who were trying to evacuate the area, U.S. Central command added.


These guys used to issue the world’s reserve currency too
by Simon Black on August 13, 2014

Spoleto, Italy

For hundreds of years the Byzantine Empire coined the most popular reserve currency in the history of the world.

Merchants all over Europe, the Mediterranean, the Middle East, and further, used it in trade for centuries.

It was called the solidus, and was introduced by Constantine I in 312 AD.

The solidus held steady at 4.5 grams of 24-carat gold for nearly seven centuries. Hence its Latin name – ‘solid’. The durability of its purity is nearly unprecedented in the history of money.

Its weight, dimensions and purity remained constant until the 10th century when the government began to debase it.

The debasement was gradual at first, then accelerated rapidly.

In a matter of decades its gold content was reduced to almost zero as the Byzantine Empire was scrambling for cash to finance its numerous wars.

Consequently, Emperor Alexios I Komenos drastically overhauled the Byzantine coinage system in 1092 and introduced a new gold coin, the hyperpyron.


Jim Sinclair’s Commentary

Maybe the manipulators have gone too far. Let’s see what class action suits follow.

Banks Said to Get Enforcement Letters in FX-Rigging Probe
By Jesse Hamilton and Dakin Campbell Aug 13, 2014 6:43 PM ET

Banks including JPMorgan Chase & Co. (JPM), Citigroup Inc. (C) and Morgan Stanley (MS) have been notified regulators are preparing enforcement actions on currency rigging, people familiar with the investigation said.

Talks are progressing between banks, the U.S. Federal Reserve and the Office of the Comptroller of the Currency to settle investigations into alleged manipulation of foreign-exchange markets, according to two people, who asked not to be identified because the talks are private. Some firms have received so-called 15-day letters outlining the agencies’ findings and warning that enforcement actions are likely, the people said.

Enforcement actions can range from cease-and-desist orders to fines to banning bankers from the industry. The letters typically detail the investigators’ findings and give recipients about 15 days to offer a written defense. Such notices usually open a final stage of settlement negotiations.

U.S. regulators are coordinating with the U.K.’s Financial Conduct Authority to settle some of the probes by November, according to two people. The FCA has scheduled meetings as soon as next month to begin negotiations with some banks on penalties as part of settlement talks it’s having with Barclays Plc, Citigroup, HSBC Holdings Plc, JPMorgan, Royal Bank of Scotland Group Plc and UBS AG.

Some investigations are taking longer, and talks with firms such as Bank of America Corp. haven’t progressed as far as a 15-day letter, according to one person.


5-Day Gaza Ceasefire Over In 5 Minutes As Hamas Fire Rockets, Israel Sends Warplanes
Submitted by Tyler Durden on 08/13/2014 18:03 -0400

Even before the world’s media had had chance to relay the ‘great’ news that Israel and Hamas had agreed a 120-hour (5-day) ceasefire, Hamas reportedly fired 5 rockets instantly breaching the ceasefire. Israel’s response – launch warplanes and unleash a bombing campaign…

This just happened…





We presume that "ceasefire" means something different in Gaza?







For the record, Hamas denies responsibility for the rockets.



Militants’ Siege on Mountain in Iraq Is Over, Pentagon Says

WASHINGTON — Defense Department officials said late Wednesday that United States airstrikes and Kurdish fighters had broken the Islamic militants’ siege of Mount Sinjar, allowing thousands of the Yazidis trapped there to escape.

An initial report from about a dozen Marines and Special Operations forces who arrived on Tuesday and spent 24 hours on the northern Iraqi mountain said that “the situation is much more manageable,” a senior Defense official said in an interview.

Defense Secretary Chuck Hagel, speaking to reporters Wednesday night at Andrews Air Force Base, Md., said it was “far less likely now” that the United States would undertake a rescue mission because the assessment team reported far fewer Yazidis on the mountain than expected, and that those still there were in relatively good condition.

Rear Adm. John Kirby, the Pentagon press secretary, credited American airstrikes and humanitarian airdrops as well as efforts of the Kurdish pesh merga fighters in allowing “thousands of Yazidis to evacuate from the mountain each night over the last several days” and to escape the militants from the Islamic State in Iraq and Syria.


July retail sales stay flat
Doug Carroll, USA TODAY 8:56 a.m. EDT August 13, 2014

Consumers remained cautious in their spending last month, generating no growth in retail sales.

The Commerce Department said Wednesday retail sales were virtually unchanged from June, breaking a five month string of increases.

Motor vehicles and parts sales fell 0.2%, pulling down the overall results.

Excluding motor vehicles and parts, retail sales rose 0.1%, Commerce said.

The report came in below what economists had expected — 0.3% growth overall and, excluding autos, 0.4% growth, according to the median forecast in Action Economics’ survey.

Sales fell at department stores, furniture and home furnishings stores, electronics and appliance stores, and Internet retailers. Among the retail categories posting better sales were building materials, food and beverage stores, health and personal care, clothing and restaurants.



Jim Sinclair’s Commentary

The left and right hand are on different courses.

Pentagon Refuses to Cancel Deal With Russia, Sparks Controversy in Arms Lobby
18:45 09/08/2014

MOSCOW, August 9 (RIA Novosti) -Congressmen are criticizing Pentagon officials for maintaining contracts with Rosoboronexport, Russian arms exporter, that is supplying Mi-17 helicopters to the US-backed Afghanistan army.

"Particularly after Vladimir Putin’s recent behavior, we should not be filling the coffers of Russian arms dealers," said Rep. Rosa DeLauro, a Connecticut congresswoman, cited by CBS News. In the wake of increased tensions between Russia and the US, the Pentagon should cancel its deal with Moscow, American lawmakers insist.

Pentagon argues that the cancellation of the contract would be a "catastrophic" blow to the ability of Afghan forces to carry out counterterrorist operations.

"The reason I use the word catastrophic, which I don’t think is hyperbole, is because the inability of the Afghans to have the operational reach represented by the Mi-17 will seriously deteriorate their ability to take the fight to the enemy," claimed Marine Gen. Joseph Dunford, quoted by the Stars and Stripes, "But the more important reason I use the word catastrophic is their inability to take the fight to the enemy will actually put young Americans in harm’s way in 2015 and beyond."

“One of the reasons the Afghans like the Russian helicopters is that Russian helicopters are a bit more forgiving in austere environments,” claims Christopher Harmer, a former US Navy helicopter pilot and a senior naval analyst with the Institute for the Study of War, as cited by the Economic Times.

The Russian Mi-17 helicopter "is best suited for Afghanistan’s rugged terrain and thin altitude and less work for Afghans to keep running than rival-US made systems," insists the US Defense Department, as cited by The Hill. It should be noted that the Pentagon has already purchased 88 Mi-17 helicopters for its Afghan Air Force.

It’s not the first time the joint program of the Pentagon and Rosoboronexport, Russia’s arm exporter, sparks controversy among the American lawmakers. About a year ago the Associated Press reported of a heated debate provoked by the contract in the US Congress. Senators claimed the Pentagon should block the deal because of the fact that Russia had sold advanced weaponry to Syria and Iran, sheltered Edward Snowden and criticized the US State Department for violating human rights. According to lawmakers, the Pentagon had to replace Russian helicopters with American choppers, particularly Boeing’s Chinook or the UH-60 Blackhawk, made by Sikorsky.


Jim Sinclair’s Commentary

Some recovery…

Wages in U.S. down 23 percent since 2008, report shows
By Cliff Pinckard, Northeast Ohio Media Group
on August 12, 2014 at 2:29 AM

While 8.7 million jobs have been regained since the 2008 recession, they are paying much less, by an average of 23 percent, according to a report released Monday by the United States Conference of Mayors.

The report comes as debate continues about income inequality in the United States.

"While the economy is picking up steam, income inequality and wage gaps are an alarming trend that must be addressed," said Conference of Mayors President Kevin Johnson, the mayor of Sacramento, Calif., in a news release. "We cannot put our heads in the sand on these issues."

The annual wage in sectors where jobs were lost, particularly in manufacturing and construction, during the recession was $61,637, but the average wage of new jobs through the second quarter of 2014 is $47,131, the report shows.

It represents a loss of $93 billion in wages, according to the report. (Go below to see the full report. Mobile users can see it here.)

The losses in construction and manufacturing were replaced by jobs in hospitality, health-care and administrative support.

The report shows the gap between low- and higher-income households is growing and likely will continue in the future. In 2012, the latest year for which figures are available, 73 percent of metro areas had a larger share of poorer households (those making less than $35,000 per year) than upper-income households of above $75,000.


Jim Sinclair’s Commentary

This would be price positive.

Indian Commerce Minister Calls For Gold-Import Duty Cut – HSBC
Wednesday August 13, 2014 8:22 AM
By Debbie Carlson of Kitco News; [email protected]

In an interview with the Press Trust of India, Commerce and Industry Minister of State, Nirmala Sitaraman, said the country’s gold import duty should be eased, HSBC says. The duty has not only impeded the gems and jewelry industry, but it has also led to a spike in illegal gold imports. “India’s appetite for gold may hinge on the performance of the country’s current account deficit. The Indian government has often cited bullion as the primary cause for the country’s ballooning trade deficit,” HSBC says. The bank notes the current account deficit has narrowed according to the latest data, and the May election of Prime Minister Narendra Modi fanned hopes some these restrictions may be rolled back. “While there has been some effort to ease bullion restrictions, such as allowing more entities to import gold, the import duty remains at 10%. A further narrowing of the country’s current account deficit may be an important factor to unlocking India’s bullion appetite, in our view,” HSBC says.


Jim Sinclair’s Commentary

This winter is no time for a gas war between the EU and Russia.

EU gas production decline to reach 43% in next 12 years
August 13, 14:48 UTC+4

MOSCOW, August 13./ITAR-TASS/. Natural gas production in EU counties in the next 12 years regardless of possible development of non-traditional gas resources will decline by 43% against the 2013 level, Russia’s National Energy Security Fund (NESF) said on Wednesday.

Thus, over the next 12 years the EU gas resource base will be reduced by 70 billion cubic metres, which is comparable with the annual consumption of Italy and 2.5 times exceeds the supplies of Algerian pipeline gas to the European Union, the NESF analytical note says.

European Union’s own production at present satisfies only 35% of the internal demand. However, the EU now has only two net gas exporters: the Netherlands that in 2013 supplied more than half of gas produced in the EU and Denmark that has a rather low share of gas in its energy balance. Romania’s own production satisfies more than 80% of its demand, and the UK that in the middle of the 2000s had the status of the EU largest producer, last year satisfied only 50% of its internal demand.

Over the past three years alone, the EU gas production declined by 34 billion cubic metres (17%). However, in 2013, thanks to gas production increase at the major Groningen gas field in the Netherlands, as well as Croatia’s accession to the EU, the production decline stopped and even somewhat increased – by 300 million cubic metres against the 2012 level.


Nigeria fears fourth Ebola frontline after infected man lands in Lagos
Officials in Africa’s most populous city are scrambling to avoid mistakes that have helped fuel biggest epidemic in history
Monica Mark in Lagos, Wednesday 13 August 2014 08.23 EDT

The man was acting strangely even before he boarded the plane, hunching over in pain and avoiding physical contact with other passengers milling around the airport in Monrovia, Liberia’s capital. Once airborne, he was sick several times. By the time he disembarked in Lagos airport – one of the busiest in the continent – he was no longer able to stand unaided, diplomats and a witness told the Guardian.

Those who rushed forward to help didn’t know Patrick Sawyer was in the final stages of an Ebola-induced breakdown, when the deadly disease is at its most contagious. More than 24 hours passed before the Liberian-American civil servant was diagnosed, allowing the virus to gain a toehold in Africa’s most populous city and, for the first time ever, turning the threat of an urban outbreak into a nightmarish possibility.

After watching three regional neighbours battle an eight-month-long epidemic, Nigerian officials are scrambling to avoid mistakes that have helped fuel the biggest epidemic in history. In Guinea, Liberia and Sierra Leone, 916 have died, or around half of those who been infected.


Jim Sinclair’s Commentary

Sanctions create new alliances.

Ecuador to decide whether to export foods to Russia at its sole discretion — president
August 13, 14:30 UTC+4

BOGOTA, August 13. /ITAR-TASS/. Ecuador will not be asking permission from any third party whether it can export foods to other countries, including Russia, President Rafael Correa said on Tuesday.

“We have no intention of seeking permission from no one to sell foods to friendly countries. After all, Latin America is not a member of the European Union yet,” local media quote Correa as saying.

Britain’s Financial Times said on August 11 Brussels reacted with concern to the enthusiasm some manufacturers in Latin America reacted to Russia’s ban on the import of foods from the European Union, imposed in retaliation for anti-Russian sanctions.

An EU official said the union would be conducting talks with the countries that may potentially substitute for European export to Russia to express the expectation they will not derive benefits from the current situation.


Canada will donate up to 1,000 experimental Ebola vaccine doses to WHO
Published time: August 12, 2014 23:31

Canada has offered to donate its experimental Ebola virus vaccine to West African States after the WHO said it would be ethical to use untested vaccines to try and contain the outbreak that has already claimed the lives of more than 1,000 people.

According to the Public Health Agency of Canada (PHA) the country sees the vaccine as a global resource and is in talks with the US and the World Health Organization to coordinate the best application of a limited number of doses in its possession.

The deputy head of PHA Dr. Gregory Taylor estimates that Canada has about 1,500 doses of the vaccine, which has not yet been tested on people, saying that 1,000 doses of vaccine could be sent abroad for use, Canadian Press reports.

Taylor also warned that since the drug is yet to be tested on humans, it’s not clear what dosage is needed to protect a person, so those numbers could change.

Earlier on Tuesday, the WHO announced that experimental drugs can be used to treat patients but the scarcity of supplies raises questions who gets saved first.

“There was unanimous agreement among the experts that in the special circumstances of this Ebola outbreak it is ethical to offer unregistered interventions as potential treatments or prevention,” the WHO’s assistant director general Marie-Paule Kieny said after an ethics panel published its guidance.


The Housing Recovery Continues Apace – Mortgage Apps At 14-Year Low
Tyler Durden on 08/13/2014 10:00 -0400

How much longer can the myth of a housing recovery remain alive in the mainstream media’s narrative? The smoothed average of Mortgage Applications in the US fell to its lowest since September 2000 this week. Mortgage applications have slumped for 9 months… as mortgage rates have declined notably… but still we are told ‘rates are just too high’. And yet, bullish market protagonists are convinced rates are due to rise (and the bond market is wrong) – one can only imagine the slump if that should occur…



Posted at 8:36 AM (CST) by & filed under In The News.

Here Is The Average Cost To Rent A 2-Bedroom Apartment In Your City
Tyler Durden on 08/12/2014 14:15 -0400

We have been pounding the table since 2009 that without a sustainable increase in average disposable income, the US housing market – that core driver for "wealth effect" and net worth for the "rest of us", i.e., those non-1%erswhose net worth is not tied up in various rigged, manipulated capital markets – will never recover, and as a result, neither will the US economy.

Four dead-cat bounces, and yet another fading bubble in home prices later, this has again proven accurate, with the percentage of Americans owning houses dropping to levels not seen in 19 years.


The inverse, or the percentage of Americans renting, promptly manifested itself, and is essentially a mirror image of the chart above.


To be sure, the logical tradeoff to unaffordable housing, one which also was expected from the beginning, and has manifested itself quarter after quarter, is a relentless increase in median asking rents to new monthly record highs across the nation…


U.S. Economic Confidence Index Ticks Down to -17
Down two points from previous week
by Justin McCarthy

WASHINGTON, D.C. — Gallup’s U.S. Economic Confidence Index dropped slightly to -17 for the week ending Aug. 10. Though falling two points from the previous week, the index score is an improvement from the -21 recorded at the end of July, the lowest measure so far in 2014.


Though Gallup’s weekly index readings have been remarkably stable so far in 2014, they have shown a bit more variation since July. Week-to-week fluctuations rarely exceeded more than two index points in either direction earlier in 2014, but a six-point drop in July was a brief departure from that stability. The latest reading, however, is a return to the pattern of consistent readings seen so far in 2014.

Gallup’s Economic Confidence Index is the average of two components: Americans’ views on the current economic situation and their perceptions of whether the economy is getting better or worse. Last week, 19% of Americans said the economy is "excellent" or "good," while 35% said it is "poor," resulting in a current conditions score of -16 — a three-point dip from the previous week.

While 38% of Americans said the economy is "getting better," 56% said it is "getting worse," resulting in an economic outlook score of -18. This is one point lower than the prior week.


The Safest Investments in a Dangerous World Market
by James Rickards.
Posted Aug 8, 2014.

The relationship between geopolitics and global finance has rarely been more densely connected and complex as it is today.

Knowing how to invest and allocate assets among various classes requires understanding the strategic drivers of valuation and volatility. Here is an around-the-world tour of flashpoints and their implications for investors.

Putin is proving himself to be patient, nimble and focused compared to the White House, which is reactive, clumsy and easily distracted.

The disintegration of Iraq is far from over. The situation will deteriorate further putting upward pressure on oil prices. The ISIS-Sunni drive to Baghdad has been temporarily slowed due to the Shiite call to arms, and Iranian intervention on the side of Shiites and the al-Maliki government. ISIS sensibly is regrouping and consolidating gains while awaiting further aid from its Saudi sponsors. All of this is a prelude to much larger battles to come.

The war in Iraq has the potential to become a regional war. Turkey may be drawn in by the emergence of a Kurdish state in northern Iraq. Iran has already been drawn in to support al-Maliki. Syria and Iraq have effectively been partly merged because the border has been erased. Jordan is relatively weak and will be hurt by refugees and spillovers.

Jordanian territory is used by both ISIS and the United States for base operations. None of these developments will be resolved soon, so the regionalization of the conflict will proceed with negative implications for regional energy supplies.


Only 1.3 Billion Worldwide Employed Full Time for Employer
Northern America, former Soviet Union lead in Payroll to Population
by Jon Clifton and Ben Ryan
August 12, 2014

This article is part of a weeklong series focusing on how people worldwide answer some of today’s most pressing questions about employment and the economy.

WASHINGTON, D.C. — About one in four adults worldwide — or roughly 1.3 billion people — worked full time for an employer in 2013. Gallup’s Payroll to Population (P2P) rate, which reports the percentage of the total adult population that works at least 30 hours per week for an employer, has not grown since 2012.


Gallup’s latest global P2P measurements are based on more than 136,000 interviews across 136 countries in 2013, in which adults were asked a battery of employment questions modeled on the International Labour Organization’s standards. Gallup does not count adults who are self-employed, working part time, unemployed, or out of the workforce as payroll-employed in the P2P metric, and it is not seasonally adjusted.


Jim Sinclair’s Commentary

Blocking this as a Trojan Horse will backfire on Kiev.

Ukraine to Block Russian Aid Trucks as It Tightens Noose Around Rebels
By Volodymyr Verbyany and Kateryna Choursina  Aug 12, 2014 12:12 PM ET 

Ukraine refused to let a convoy that Russia says is loaded with humanitarian aid enter the country in its current form, arguing the mission doesn’t adhere to international rules and must be led by the Red Cross.

Russia’s Emergencies Ministry said 280 trucks with 2,000 metric tons of donated food, medicine and water left Moscow for rebel-held eastern Ukraine today. Ukrainian military spokesman Andriy Lysenko said they are carrying military gear in the guise of aid. The Geneva-based International Committee of the Red Cross said it’s not in charge of the convoy at the moment and has asked for details of what it contains.

The ICRC needs “some clarification first regarding modalities, practical steps that have to be implemented prior to launch such an operation,” Laurent Corbaz, its head of operations for Europe, said in a video on the Red Cross website. “We seriously need security guarantees, for example, and direct contact with all the parties; this is not settled yet. We need as well to know precisely what is inside the convoy, the size of this convoy, and the various material that is going to be handed over.”

The wrangling over the aid comes as Ukrainian forces tighten a noose around pro-Russian rebel strongholds in the cities of Donetsk and Luhansk, where thousands are without water and power. Ukraine blames Russian President Vladimir Putin for stoking a separatist war that has killed more than 1,200 people in the east after annexing the Crimean peninsula in March.


Jim Sinclair’s Commentary

Some easing of geopolitical tension that has no long term solution inherent.

Senior Iranian official congratulates new Iraqi PM Haider al-Abadi
Support for prime minister effectively removes any hope Nouri al-Maliki may have of regaining power amid insurgency

Saeed Kamali Dehghan in London and Katharine Murphy in Sydney, Tuesday 12 August 2014 09.10 EDT

A senior Iranian official with close links to the country’s president and supreme leader has offered his congratulations to Iraq’s prime minister-designate, suggesting Tehran has abandoned former ally Nouri al-Maliki amid the current Sunni militant insurgency.

Ali Shamkhani, the secretary of Iran’s powerful Supreme National Security Council, was quoted by the official IRNA news agency congratulating the Iraqi people and their leaders for choosing Haider al-Abadi as their new prime minister.

Abadi, a veteran of Iraq’s post-Saddam Hussein governments, was appointed on Monday after the country’s president effectively deposed Maliki in an effort to break the political deadlock that has paralysed the government while jihadists sweep through the north of the country.

Shamkhani, a close ally of President Hassan Rouhani and a representative of Ayatollah Ali Khamenei on the council, said Iran supported "the legal process for choosing the new Iraqi prime minister".

The US secretary of state, John Kerry, said earlier on Tuesday that Washington was ready to "fully support a new and inclusive Iraqi government". While attending the annual Ausmin talks in Australia, Kerry urged Abadi to form a functional cabinet "as swiftly as possible" and said the US was ready to offer more military and economic help.

"We are prepared to consider additional political, economic and security options as Iraq’s government starts to build a new government," he said in Sydney.


Russian aid convoy ‘will not be admitted into Ukraine’
Ukrainian spokesman says convoy not certified by Red Cross, raising fears that Russia could use initiative to send in troops, Tuesday 12 August 2014 06.49 EDT

A Ukrainian security spokesman has said that a humanitarian convoy Russia has dispatched to eastern Ukraine will not be admitted into the country.

Andriy Lysenko, a spokesman for Ukraine’s national security and defence council, said the convoy had not been certified by theInternational Committee of the Red Cross (ICRC).

A convoy of 280 Russian trucks headed for Ukraine early on Tuesday, a day after agreement was reached on an international humanitarian relief mission.

But the ICRC, which was due to coordinate the operation, said it had no information on what the trucks were carrying or where they were going. That has raised fears in Ukraine and the west, where leaders have voiced concerns that Russia could use the initiative as a pretext for sending troops into separatist-held territory.

An aide to the Ukrainian president, Petro Poroshenko, said Kiev would require the ICRC to reload the aid onto other transport vehicles at the border if it was to enter. "We will not allow any escort by the emergencies ministry of Russia or by the military. Everything will be under the control of the Ukrainian side," Valery Chaly said.

Earlier on Tuesday, the Itar-Tass news agency said the convoy has departed from near Moscow, meaning it would take it a couple of days to arrive in east Ukraine, about 620 miles (1,000km) to the south-west. "It has all been agreed with Ukraine," Business FM radio quoted President Vladimir Putin’s spokesman, Dmitry Peskov, as saying.

Thousands of people are said to be short of water, electricity and medical aid because of the fighting. The US president, Barack Obama, has said any Russian intervention without Kiev’s consent would be unacceptable and violate international law.



French, Russian presidents concerned over worsening humanitarian crisis in Ukraine
August 12, 15:45 UTC+4

MOSCOW, August 12./ITAR-TASS/. President Vladimir Putin and his French counterpart Francois Hollande in a telephone conversation Tuesday have expressed serious concern over continuing degradation of the situation in Ukraine and worsening of humanitarian problems in the southeast, the Kremlin press service said.

Both presidents stressed the importance of rendering humanitarian assistance to the peaceful population of Ukraine and gave priority importance to ending military operations there, it said.

"Putin told the French president about concrete steps Russia has taken to establish conacts with ICRC represenatives. Both presidents reiterated priorioty importance of ending military operations in Ukraine and reaching soonest political settlement of Ukranian home problems," the source said.

The two presidents also touched upon the situation in Iraq and in Gaza and came out for building up international efforts for settlement of these pressing problems, it said.

The Russian president also cordially wished happy birthday to Francois Hollande, who turned 60 on Tuesday.


Construction of Crimean bridge approach roads to start in August — minister
August 12, 15:09 UTC+4

MOSCOW, August 12. /ITAR-TASS/. Construction of approach roads to the future bridge linking Crimea to the Krasnodar Region will start in August and will be financed by Russian Railways, Crimean Affairs Minister Oleg Savelyev told Rossiya 24 channel Tuesday.

“In fact, the construction of approaches will start in August at the expense of Russian Railways. We will face quite large costs and troubles while building the approaches to the bridge on the Krasnodar Region side,” Savelyev said.

The total investments in the bridge are planned at around 247 billion rubles ($6.8 billion). The launch is scheduled for December 2018.


Jim Sinclair’s Commentary

Boots on the ground win wars so it is presently in the Kurds hands.

The Guardian view on the chances for successful US intervention in Iraq
There is no simple confrontation between Iraq and Isis, but a three-cornered contest between Iraq’s major regions, with further contests within each
The Guardian, Monday 11 August 2014 15.04 EDT

President Obama had no real alternative to the air strikes he ordered last week against Islamic State (Isis) forces. The Yazidis and Christians of the region are in flight, and Kurdish territory proper, even the city of Erbil, could be at risk. Quite apart from the threat to the future of Iraq as a whole, the US and Britain have a humanitarian duty to the endangered minorities, and a debt of honour to the Kurds.

But that does not mean that this intervention is going to be either an easy or an effective one. For one thing, it comes after years in which the attempts of America and its allies to reshape Iraq have gone spectacularly wrong, illustrating again and again how disastrous has been the combination of ignorance and incompetence which has marked so many of the coalition’s efforts in that country.

For another, it comes at a time of extreme political volatility in every part of Iraq. There is of course no simple confrontation between Iraq and Isis. Instead there is a three-cornered contest between Iraq’s major regions, with further contests within each part. The most extreme of these regional contests, potentially, may be that between Isis and northern Sunni tribal and factional groups. But the Shia south is also divided, as Monday’s manoeuvres and counter-manoeuvres in Baghdad over the status of prime minister Nouri al-Maliki showed. So is Kurdistan, where longstanding rivalry between political parties and leading families has never been overcome, and where the peshmerga, the region’s army, although nominally united, still reflects those divisions.

The fact that Kurdistan has been a relative success story, compared with other parts of Iraq, has obscured the fact that it has many of the weaknesses of a typical oil-dependent state, including corruption, too many people on the government payroll, and a foreign labour force to do the menial as well as some of the expert jobs. This oil-based inflation of employment extends to the armed forces, criticised as too large, uncoordinated, too lightly equipped, and with poor logistical support. Professional armies do not run out of ammunition after a couple of days of combat, as some Kurd units are said to have done.


JPMorgan Joins Goldman in Designing Derivatives for a New Generation
By Sridhar Natarajan and Alastair Marsh Aug 12, 2014 7:50 AM MT

Derivatives that helped inflate the 2007 credit bubble are being remade for a new generation.

JPMorgan Chase & Co. is offering a swap contract tied to a speculative-grade loan index that makes it easier for investors to wager on the debt. Goldman Sachs Group Inc. is planning as much as 10 billion euros ($13.4 billion) of structured investments that bundle debt into top-rated securities, while ProShares last week started offering exchange-traded funds backed by credit-default swaps on company debt.

Wall Street is starting to return to the financial innovation that helped extend the debt rally seven years ago before exacerbating the worst financial crisis since the Great Depression. The instruments are springing back to life as investors seek new ways to boost returns that are being suppressed by central bank stimulus. At the same time, they’re allowing hedge funds and other investors to bet more cheaply on a plunge after a 145 percent rally in junk bonds since 2008.

“The true sign of a top is when you have these new structures piling up,” said Lawrence McDonald, a chief strategist at Newedge USA LLC, and author of the book “A Colossal Failure of Common Sense” about the 2008 demise of Lehman Brothers Holdings Inc. “At the top of the market in 2007, there were these types of innovation and many investors didn’t realize about it at that time. These products are a clear risk indicator.”


Posted at 8:36 AM (CST) by & filed under Jim's Mailbox.


But if they’re in, will they go out again and what will the Ukraine do about it? Shooting those trucks apart will not be very well for the health of Ukraine.

CIGA Richard

Luhansk to be final point for aid convoy — Donetsk Republic vice-premier
August 12, 15:54 UTC+4

DONETSK, August 12./ITAR-TASS/. Luhansk will be a final destination point for humanitarian aid delivery to southeast Ukraine residents, Vice-Premier of the self proclaimed Donetsk People’s Republic (DPR) Andrei Purgin said on Tuesday.

Russia’s convoy of trucks with humanitarian supplies for the population of southeast Ukraine set out early on Tuesday morning from the Moscow Region. The humanitarian supplies include foodstuffs, baby food, medicines and drinking water.

“The convoy is moving to Luhansk through Kharkov and will most likely stop in the town of Schastye [a Luhansk suburb]. If everything proceeds normally, combat operations will be halted there. We don’t have any other details right now,” the DPR vice-premier said.

Humanitarian aid distribution in Lugansk may be complicated due to the complete absence of communications with the city and its destroyed infrastructure, he said.




Are they also going to talk to other countries when, for example, those beautiful Mercedes and BMW automobiles are being banned?

It always comes down to money and why would other countries not take the opportunity in the 140 million plus Russian market. Besides that, Russia is a very strong ally of China and we know what investments China is making in South America.

CIGA Richard

EU plans Russia sanctions talks with Latin America countries
August 12, 12:02 UTC+4

MOSCOW, August 12. /ITAR-TASS/. The EU plans to hold talks with countries such as Brazil and Chile to dissuade them from stepping in to replace Europe’s banned agricultural exports to Russia, senior officials said on Monday, the Financial Times reported.

Since Russia banned food imports from the EU and the US last week in a response to sanctions, Moscow has been negotiating with Latin American countries for alternative supplies. Several countries and trade groups in South America said that Moscow’s measures could offer them a lucrative windfall.

Brazil has authorized about 90 new meat plants to immediately start exporting chicken, beef and pork to Russia, and Chile is tipped as a leading beneficiary of Russia’s embargo on European fish.

Seneri Paludo, Brazil’s Secretary for Agricultural Policy, said Russia’s embargo could also allow Brazil to export more corn and soy beans to the country. “Russia has the potential to be a large consumer of agricultural commodities, not just meat,” he said.

Such excitement in the agricultural powerhouses of Latin America has triggered concern in Brussels. “We will be talking to the countries that would be potentially replacing our exports to indicate that we would expect them not to profit unfairly from the current situation,” said one senior EU official at a briefing on the situation in Ukraine.