Posted at 5:11 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

Isn’t it good that last year’s cold was just a one off event?

clip_image001

 

Greece: Tsipras visits Chinese Navy delegation – Syriza’s plan B?
Published on Feb 19, 2015

Greek Prime Minister Alexis Tsipras was welcomed aboard a Chinese warship at Piraeus port on Thursday, an indication bilateral ties could be strengthening between the two countries following Syriza’s recent election.

 

Jim Sinclair’s Commentary

Evidence of a tinder box.

Worried depositors rush to pull cash out of Greek banks
By Dody Tsiantar, Special to CNBC.com

In the midst of the dramatic showdown in Brussels between the new Greek government and its European creditors, many Greek depositors—spooked by the prospect of a Greek default or, worse, an exit from the euro zone and a possible return to the drachma—have been pulling euros out of the nation’s banks in record amounts over the last few days.

The Bank of Greece and the European Central Bank won’t report official cash outflows for January until the end of the month. But sources in the Greek banking sector have told Greek newspapers that as much as 25 billion euros (US $28.4 billion) have left Greek banks since the end of December. According to the same sources, an estimated 900 million euros flowed out of Greek banks on Tuesday alone, the day after the talks broke up in Brussels, sparking fears that measures will be taken to stem the outflow. On Thursday, by mid-afternoon, deposits had shrunk by about 680 million euros (US $773 million).

“If outflows reach 1 billion euros, capital controls might need to be imposed,” said Thanasis Koukakis, a financial editor for Estia a conservative daily, and To Vima, an influential Sunday newspaper.

On Thursday, Germany rejected Greece’s application to extend its loan agreement for four months and renegotiate the terms of its bailout, raising the threat of Athens’ running out of money in the coming weeks. Under the current program, the country has received 240 billion euros, or $272 billion, in exchange for pursuing various overhauls.

More…

 

Jim Sinclair’s Commentary

This is a great advertisement for GOTS.

clip_image003
February 20, 2015
Los Angeles, California

File this under ‘you can’t make this stuff up.’

Lenovo Group, the largest computer manufacturer in the world, has made a rather stunning admission that they have been pre-installing tracking software on their PCs.

The tracking software is made by a company called Superfish, which apparently paid some “very minor compensation” to Lenovo for putting the software on people’s computers.

The Superfish program is a total disaster.

It has image recognition algorithms which essentially monitor what a user is looking at… then suggests relevant ads based on what it thinks you might like.

This is not only REALLY high up on the creepy scale, it also completely destroys Internet security.

Whether you’re buying something online or accessing Internet banking, the Superfish program essentially cuts the secure link between you and sensitive websites that you’re trying to access.

According to the first user who found the vulnerability a few weeks ago, “[Superfish] will hijack ALL your secure web connections (SSL/TLS) by using self-signed root certificate authority, making it look legitimate to the browser.”

This means that the tracking software basically fools a web browser into believing that a connection is secure when it’s not… all for the purpose of pushing more ads in your face.

This scheme is so powerful that even if users uninstall the Superfish software, the security breach still remains.

This is so flagrant I have to imagine that even the NSA is shocked.

After its initial approach of being completely unapologetic and dismissal, Lenovo is now groveling for forgiveness.

The company’s Chief Technology Officer now says, “We messed up badly here,” and “We made a mistake.”

Duh. But untold amounts of consumers out there have been totally violated.

There are a few interesting points to make here–

1) Privacy isn’t dead. But it’s extremely difficult to maintain. There are so many forces out there trying to pry whatever little privacy remains from us, one has to fight tooth and nail to preserve it.

2) There’s no transparency in the system; we never really know what’s going on behind the scenes with big institutions.

Governments and politicians will lie to our faces. They’ll tell us to be excited and that everything is fine; then behind the scenes they’ll plan for capital controls and huge tax increases.

No one has any idea what kind of toxic crap banks have on their balance sheets. They’ll post record profits and tell us how successful they are. But internally they know that it’s only a matter of time before they collapse (as we saw in 2008).

Even major tech brands are betraying the public in the dark of night with crazy spyware or selling us all out to government agencies.

There are very few, if any, big institutions out there that we can trust anymore.

And maybe that’s how it should be.

It’s a shark-filled world with bad people who do bad things. Perhaps it’s all the better that a trusted brand becomes the poster child for betrayal.

Because if Lenovo is doing this, are we supposed to be so naïve to presume that Google, Apple, AT&T, etc. are not?

Question everything.

Have a great weekend,
Simon Black
Founder, SovereignMan.com

 

Why The “1%” Hates The Gold Standard
02/20/2015 12:16 -0500

By now everybody knows that the primary consequence, one which we originally predicted back in 2009 – and many have since agreed – was completely intended, of the past 6 years of unprecedented monetary policy has been to push wealth inequality to record levels, not just in the US but across the world. What may not be so clear is precisely when this period of unprecedented wealth disparity started. The answer, as the following handy chart from NPR shows, is that long before QE, the wealth gap for the 1% really started in the early 1980s, courtesy of none other than Greenspan’s “great moderation.”

clip_image005

More importantly, and what is certainly not known, is that between 1930 and 1970, it was only the “bottom 90%” that saw their incomes rise, as can be seen on the next chart.

More…

 

Jim Sinclair’s Commentary

Look at that can get another short term kick.

Greece Reaches Accord With European Officials to Extend Bailout
By LIZ ALDERMAN and JAMES KANTER
FEB. 20, 2015

BRUSSELS — European leaders agreed Friday to extend Greece’s bailout for four months after weeks of tense negotiations.

The deal, reached at an emergency meeting of eurozone finance ministers here, paves the way for Greece to unlock further financial aid from a 240 billion euro, or $273 billion, bailout deal — provided the country meets certain commitments laid out by its creditors.

“I’m glad to report to you that the work has paid off,” Jeroen Dijsselbloem, the head of the Eurogroup of finance ministers, said at a news conference. “We have established common ground again.”

The new agreement will require the two sides to continue to work through their differences.

For one thing, Greece will not receive any of a €7 billion installment from the bailout until it has carried out all remaining reforms required by creditors, some of which Mr. Tsipras had pledged to roll back. Greece must also show that it is not abandoning austerity measures unilaterally.

That means that if Athens moves slowly, it might not get the money for months.

The deal is likely to give Greece breathing room. For one, it could help stem flights of deposits from the country’s banks, which have been bleeding money amid the standoff between Greece and its creditors.

But it will hardly move the country past the worst of its economic and financial troubles. The economy has shrunk by a quarter in the last five years, and unemployment stands at more than 25 percent.

More…

Posted at 2:17 PM (CST) by & filed under Jim's Mailbox.

Jim,

Sounds like a lot of “making excuses” to me.

Productivity, the hardest thing for economists to get their hands around, is ideal for use as an excuse to procrastinate in raising rates, yet at the same time, giving the impression the economy is recuperating.

A beautifully contrived move of deception by Yellen!

CIGA Wolfgang

Yellen Confronts Economists’ Ignorance

(Bloomberg) — Productivity is probably the most important measure of economic health that policy makers know the least about.

Its pace will help determine how soon Federal Reserve Chair Janet Yellen and her colleagues increase interest rates and how far rates ultimately will rise.

A quicker advance would argue for a later lift-off because the economy would have more room to run before bumping up against capacity constraints. It also eventually would require a higher ending point to prevent the more-vibrant expansion from overheating. Slower productivity would call for the opposite strategy.

The trouble, according to former Fed Vice Chairman Alan Blinder, is that economists — including those at the Fed — don’t have a good idea of how fast productivity will grow in the next few years.

More…

 

Jim,

The article below is an excellent read.

Essentially, almost no gold is used by the LBMA to price fix it daily!

Furthermore, Gresham’s Law guaranties gold will soar to new heights.

CIGA Wolfgang Rech

Wolfgang,

Economic law cannot and has not been cancelled by computer driven Algos making markets. It has only been delayed.

Jim

David Jensen Explains How Gresham’s Law Guarantees a Gold Market Moon Shot!
Thursday February 19, 2015 13:46

clip_image001

My friend David Jensen is an engineer. He also has holds an MBA in Logistics and Supply Chain Management. The point in relating that background to you is to help explain that David is not only very much interested in cause and effect but he also has a burning desire to get to the truth so he is prepared for the inevitable. That is why I do frequent (almost weekly) podcasts with David at http://jaytaylormedia.com/audio/ to focus on the fundamentals of the gold market.  Not only has David provided very clear answers as to WHY a small ruling elite have been able to cap the price of gold even as trillions of new dollars and all manner of other fiat currencies have been created. Like a curious kid interested in knowing how a magician seemingly defies the laws of nature, David has assigned himself the task of understanding exactly HOW a small cabal of major global bankers are able to pull the wool over the eyes of markets so as to keep the masses trusting in the deceitful theft orchestrated through endless amounts of new money creation out of thin air.

More…

Posted at 9:28 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

Positive for gold.

RBI lifts ban on import of gold coins, medallions by banks
By PTI | 18 Feb, 2015, 09.22PM IST

MUMBAI: The Reserve Bank of India (RBI) today lifted the ban on imports of gold coins and medallions by banks and trading houses.

The RBI in a notification also said banks are permitted to import gold on consignment basis. Domestic sales will be, however, permitted against upfront payment only.

“While the import of gold coins and medallions will no longer be prohibited, pending further review, the restrictions on banks in selling gold coins and medallions are not being removed,” it said.

The RBI and the government have been receiving requests for clarification on some of operational aspects of guidelines on import of gold after withdrawal of restrictions on import of the metal on November 28 last year, the notification said.

Aiming to tame the then widening current account deficit (CAD), the central bank in August 2013 had prohibited imports of gold coins and medallions besides restricting inbound shipments of the metal.

Under the 80:20 scheme, which was withdrawn on November 28 last year, gold imports were linked with its exports.

The notification further said the obligation to export under the scheme will continue to apply in respect of unutilised gold imported before November 28, 2014.

More…

Posted at 9:08 PM (CST) by & filed under Jim's Mailbox.

Jim,

David stockman’s interview leads us to but one conclusion. All of the King’s men and all of the King’s horses will not be able to reassemble Humpty Dumpty. The world of never ending debt is close to being resolved.

CIGA LarryM

David Stockman Interview: The Clock Is Ticking, The Carnage Is Coming Soon
by Eric King • February 18, 2015

David Stockman Interview At King World News

David Stockman: The clock is ticking.  The carnage is coming soon and it’s not merely Greece and whether it stays in the euro or not….“But it’s symptomatic of what I believe is the gathering crisis in the world, which is that our two-decade long grand experiment in financial bailouts, massive money printing by central banks everywhere, and non-stop Keynesian debt stimulus is heading towards the wall.

Look at what’s coming down the pike.  After Wednesday in Europe, it’s inconceivable to me that there will be any lasting deal on Greece.  It is almost certain now that we are at the threshold or crossing the Rubicon which will result in a crackup of the EU and the euro.  There are just too many centrifugal forces blowing apart this experiment, which was misbegotten from the very beginning.

That will then catalyze a thundering global crisis of confidence in central banks, generally, and then we will be off to the races.  Everywhere we look in the world the central banks are on the edge of desperation.  Sweden (has now) joined the cavalcade of negative interest rates.  Denmark was already there and is desperately fighting off a massive inflow of capital out of the EU and into their market.

We saw the calamity a few weeks ago when the Swiss finally had to give up their rather lunatic peg and the exchange rate soared overnight, creating enormous losses and carnage.  Draghi is about ready to unload $1.3 trillion of make-believe, printed out of thin air money into the European financial and bond markets.

More…

 

Hi Jim,

I thought it was very interesting what Egon von Greyerz stated; “Eric, in 2008 major central banks’ balance sheets totaled $5 trillion. Today that number is $14 trillion.”

It is basically times three in seven years, but the economy has not tripled since 2008. There seems to be a serious leak in this balloon ponzi scheme. I am very happy to have my insurance when we hit the wall of reality.

Thank you for your leadership, patience and guidance. Prepare for impact and thank you,

CIGA Chuck

 

Jim,

When I was a child, we sang a song in church:

The wise man built his house upon a rock,
The rains came down and flood came up,
And the house on the rock stood firm.

The foolish man built his house upon the sand.
The rains came down and flood came up,
And the house on the sand went splat!

We have built a financial system equivalent to building a house on sand; namely excessive debt.

But not just any debt. All kinds of debt. Solid and risky.

Now it’s coming home to roost, as the rains begin to fall.

We have turned the most risk free assets into the riskiest bubble of all time. And it doesn’t stop there…

Those debt instruments became the foundation for the $700 trillion derivatives market. And it looks like Greece will be the trigger that fires the shot to start a war… a financial war of unprecedented proportions.

Lord help us! 

CIGA Wolfgang Rech

Central Bankers’ Worst Nightmares Are Unfolding in Greece
Submitted by Phoenix Capital Research on 02/19/2015 10:25 -0500

The situation in Greece boil down to the single most important issue for the financial system, namely collateral.

Modern financial theory dictates that sovereign bonds are the most “risk free” assets in the financial system (equity, municipal bond, corporate bonds, and the like are all below sovereign bonds in terms of risk profile). The reason for this is because it is far more likely for a company to go belly up than a country.

Because of this, the entire Western financial system has sovereign bonds (US Treasuries, German Bunds, Japanese sovereign bonds, etc.) as the senior most asset pledged as collateral for hundreds of trillions of Dollars worth of trades.

Indeed, the global derivatives market is roughly $700 trillion in size. That’s over TEN TIMES the world’s GDP. And sovereign bonds… including even bonds from bankrupt countries such as Greece… are one of, if not the primary collateral underlying all of these trades.

More…

Posted at 11:32 AM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

Mr. Williams shares the following with us.

- Both Production and Housing-Starts Activity Revised Lower in the Fourth-Quarter, and Flattened Out in Initial First-Quarter Estimations
- January 2015 Annual PPI Inflation Fell to Zero, Driven Lower by Falling Oil and Gasoline Prices, Which Have Turned Higher in February

“No. 697: January Industrial Production, Housing Starts, Producer Price Index”
Web-page: http://www.shadowstats.com

 

Jim Sinclair’s Commentary

Poverty causes ISIS?

clip_image002[1]

 

Jim Sinclair’s Commentary

This is that lady with the food blog’s good work.

Nestle to remove artificial flavours in US chocolate
17 February 2015 Last updated at 23:31 ET

Swiss food giant Nestle will be removing all artificial flavours and colours from its chocolate products in the US, the firm said on Tuesday.

Its US unit has promised to get rid of artificial flavours and government certified colours in more than 250 chocolates by the end of this year.

The move was prompted by its market research, which showed that US consumers wanted the additives gone.

Nestle will replace the flavours and colours with natural ingredients.

The ingredients from natural sources are certified as safe by the US Food and Drug Administration (FDA), the company said.

New recipes

For example, the centre of its Butterfinger bars will now have annatto, which comes from the seeds found in the fruit from the achiote tree, instead of certified colours Red 40 and Yellow 5, it said in a statement on Tuesday.

“In CRUNCH, natural vanilla flavour will replace artificial vanillin.”

The company is making changes to more than 75 recipes, said health and wellness manager Leslie Mohr, who added that consumer testing had been done on the new recipes.

More…

 

Jim Sinclair’s Commentary

Another popular currency retires as a store house of value. The race to the bottom is really on.

Swiss Franc Is Tumbling, Retraces 60% Of SNB Move
Submitted by Tyler Durden on 02/18/2015 11:50 -0500

Is the SNB buying Euros to keep the mirage alive that Grexit is “managable”?

EURCHF is up dramatically in the last 2 days…

clip_image003[1]

…retracing 60% of the Swiss Franc’s valuation surge against the USD…

clip_image004

It appears they are losing the battle…

Charts: Bloomberg

More…

 

Jim Sinclair’s Commentary

Italy thanks God that White Toyotas do not float for now.

Italy warns Islamic State allying with Libyan Islamist groups
Italy’s foreign minister warns ‘time running out’ to stop Islamic State establishing a foothold on the shores of the Mediterranean
By Nick Squires, Rome and Louisa Loveluck in Cairo

5:14PM GMT 18 Feb 2015

Italy warned on Wednesday that there was a grave danger of Islamic State fighters in Libya allying with other Islamist extremist groups, establishing a foothold on the shores of the Mediterranean from where they could attack Europe.

Paolo Gentiloni, the foreign minister, said that “time is running out” for the international community to forge a robust response to the growing threat just 400 hundred miles south of Italy.

Rome has been particularly alarmed by the prospect of an Islamic State of Iraq and the Levant (Isil) caliphate being established on the coast of Libya, which lies across the Mediterranean from Sicily.

“There is an evident risk of an alliance being forged between local groups and Daesh and it is a situation that has to be monitored with maximum attention,” the foreign minister told parliament, using the Arabic term for Isil.

More…

 

Jim Sinclair’s Commentary

Let us see if Chair Yellen panics as business contracts further. I believe she will, and gold will then rise to $2100 on its way to higher prices.

Housing Starts Fall as Single-Family Building Retreats
Wednesday, 18 Feb 2015 08:46 AM

Builders broke ground on fewer U.S. residential construction projects in January as demand for single-family homes cooled from an almost seven-year high, signaling the rebound in housing remains uneven.

Housing starts declined 2 percent to a 1.07 million annual rate, following the prior month’s 1.09 million pace, a Commerce Department report showed Wednesday in Washington. The median forecast of 82 economists surveyed by Bloomberg was 1.07 million. Permits, a proxy for future construction, also fell.

Student debt, tight credit conditions and rising prices are probably preventing would-be first-time homebuyers from entering the market, which will damp construction. At the same time, a strengthening labor market and rising household formation may support building of rental units, underpinning residential real estate.

“The housing recovery remains slow,” Lindsey Piegza, chief economist at Sterne Agee & Leach Inc. in Chicago, wrote in a research note before the report. “Prices are still far outpacing wage growth, making it difficult for many new homebuyers to move into the market.”

Estimates in the Bloomberg survey of economists ranged from 997,000 to 1.11 million. The prior month’s reading was little changed from the previous estimate, while the November reading was revised down.

More…

 

Jim Sinclair’s Commentary

The new Nazis are not doing too well.

Ukrainian soldiers share horrors of Debaltseve battle after stinging defeat
Thousands of Ukrainian soldiers retreat from strategic town taken by pro-Russia separatists, leaving their dead and wounded comrades behind
Alec Luhn in Artemivsk, and Oksana Grytsenko in Luhanske
Wednesday 18 February 2015 14.21 EST Last modified on Wednesday 18 February 2015 17.49 EST

A long line of military vehicles crawled north on the highway leading out of the abandoned government positions in Debaltseve in eastern Ukraine, pulling a motley assortment of half-destroyed ambulances, trucks without wheels and tanks without treads.

Those soldiers who had managed to get out of the ruins of the besieged town were immediately recognisable, their wide eyes staring out from a thick coating of grime as they waited for buses to take them back to Artemivsk. A group of national guardsmen fired their Kalashnikov assault rifles in the air to celebrate their close escape.

If Russia and the rebels continue to breach the ceasefire or otherwise overplay their hand, they are likely to face a much tougher US response

In what marks a strategic victory for pro-Russia forces and a stinging defeat for Kiev, thousands of government troops retreated from Debaltseve starting in the small hours of Wednesday, most of them on foot through the surrounding fields.

In the government-controlled village of Luhanske, which lies at the end of a deadly 10-mile stretch of highway out of Debaltseve, first lieutenant Yuriy Prekharia described how he led 50 men through the fields and forests to reach Ukrainian positions. “We knew that if we stayed there it would be definitely either be captivity or death,” he told the Guardian, as armoured vehicles passed by carrying hundreds of dirty soldiers. Heavy artillery boomed and rockets streaked through the sky as government forces tried to cover their comrades’ retreat.

More…

 

Jim Sinclair’s Commentary

The ECB blinked first, not Greece. Paper will be printed at every point of international monetary crisis and gold will rise to $2100 and more.

Greece gets lifeline as ECB agrees €3.3bn extra emergency funds
Total funding on offer now €68.3bn as Greek banks come close to using €65bn of liquidity funds granted by European Central Bank
Jennifer Rankin in Brussels, Graeme Wearden, and Helena Smith in Athens
Wednesday 18 February 2015 15.36 EST Last modified on Wednesday 18 February 2015 17.37 EST

The embattled Greek government has been thrown a lifeline by the European Central Bank after the ECB agreed to €3.3bn more emergency funds for the country’s banks.

The move came as the US warned Greece that it had to be constructive and find a deal, and Athens confirmed that it will seek an extension to its rescue loans on Thursday.

The US Treasury secretary Jack Lew told the Greek finance minister Yanis Varoufakis in a phone call that Greece would face “immediate hardship” without an agreement and said the current deadlock was not good for Europe, despite signs that a compromise might be reached ahead of Friday’s deadline. “Time is of the essence,” Lew said.

The Greek government has promised to submit a request for a loan extension to officials in Brussels, but leaked documents showed that Varoufakis will not give up on plans to repeal austerity measures such as public sector job cuts.

Despite insistence from Brussels that Greece had to stick to cost cuts outlined under its bailout plan, Varoufakis said on Wednesday night he was confident his government’s proposed extension would be approved. “I believe the proposal will satisfy the Greek side and the Eurogroup president,” he said.

More…

 

Jim Sinclair’s Commentary

The standard the dollar is on is the Petro Dollar Oil Standard invented by Nixon. When it ends so does the dollar.

I was proposed as Secretary of the Treasury when the Nixon Administration was started (New York Times article). Thank goodness it did not happen. That should drive all my manic internet trolls wild.

Expert: Oil Price Wars Fatally Wounded the Petrodollar
Alina Belyanina
Sun, Feb 15 | 2015

This is an excerpt from an interview that originally appeared in Today’s Zaman (Turkish English-language daily)

Crooke, who was in Turkey for the İstanbul Forum, has answered our questions in this regard including the question as to where Turkey stands in the world.

Would you tell us about your ideas in regards to the “financialization of the global order”?

For some time, the international order was structured around the United Nations and the corpus of international law, but more and more the West has tended to bypass the UN as an institution designed to maintain the international order, and instead relies on economic sanctions to pressure some countries.

We have a dollar-based financial system, and through instrumentalizing America’s position as controller of all dollar transactions, the US has been able to bypass the old tools of diplomacy and the UN — in order to further its aims.

But increasingly, this monopoly over the reserve currency has become the unilateral tool of the United States — displacing multilateral action at the UN.

The US claims jurisdiction over any dollar-denominated transaction that takes place anywhere in the world. And most business and trading transactions in the  world are denominated in dollars.

More…

 

Jim Sinclair’s Commentary

Now that few believe this is possible, it becomes probable.

David Stockman Interview: The Clock Is Ticking, The Carnage Is Coming Soon
by Eric King • February 18, 2015

David Stockman Interview At King World News

David Stockman: The clock is ticking.  The carnage is coming soon and it’s not merely Greece and whether it stays in the euro or not….“But it’s symptomatic of what I believe is the gathering crisis in the world, which is that our two-decade long grand experiment in financial bailouts, massive money printing by central banks everywhere, and non-stop Keynesian debt stimulus is heading towards the wall.

Look at what’s coming down the pike.  After Wednesday in Europe, it’s inconceivable to me that there will be any lasting deal on Greece.  It is almost certain now that we are at the threshold or crossing the Rubicon which will result in a crackup of the EU and the euro.  There are just too many centrifugal forces blowing apart this experiment, which was misbegotten from the very beginning.

That will then catalyze a thundering global crisis of confidence in central banks, generally, and then we will be off to the races.  Everywhere we look in the world the central banks are on the edge of desperation.  Sweden (has now) joined the cavalcade of negative interest rates.  Denmark was already there and is desperately fighting off a massive inflow of capital out of the EU and into their market.

We saw the calamity a few weeks ago when the Swiss finally had to give up their rather lunatic peg and the exchange rate soared overnight, creating enormous losses and carnage.  Draghi is about ready to unload $1.3 trillion of make-believe, printed out of thin air money into the European financial and bond markets.

More…

 

Jim Sinclair’s Commentary

This is a good concept that has to be considered. Martin might consider a name change.

Greece as a Pawn in Putin’s Chess Game vs. the West
By Martin Fluck

Last week the world woke up to the fact that Greece’s new government holds a geopolitical trump card: it can hold the EU ransom by threatening to break the fragile consensus on Russia.

The renewal of sanctions against Russia requires the unanimous support of EU members… which means Obama’s alliance against Russia needs Greek cooperation. What’s more, Greece has veto power over whether NATO can retaliate for an attack on any of its members. Article V, which states, “[A]n armed attack against one or more of them in Europe or North America shall be considered an attack against them all,” may only be invoked with unanimous agreement among NATO members.

Greece and Russia have close cultural and religious ties, and Russia is Greece’s largest trading partner. Russia’s ambassador to Athens didn’t waste any time congratulating Greece’s new prime minister, Alexis Tsipras, on his victory.

So it’s no surprise that Putin is using Greece as leverage. Russia has hinted that it will open its market to Greek food exports if Greece leaves the eurozone, and also that it would consider giving Greece financial aid. One can imagine other carrots being dangled, like an offer to hook up Greece to the Turkish Stream pipeline.

Syriza, which has close connections with Russia, admires Putin’s defiance of Western institutions. The new Greek foreign minister, Nikos Kotzias, has a relationship with Aleksandr Dugin, a Russian nationalist philosopher with close ties to Putin. As neo-eurasianists, they aim to pry a weak and divided Europe away from US influence. Syriza has openly campaigned for Greece to leave NATO, though it has toned down its hostility on that issue recently—presumably to preserve it as a useful bargaining chip for the future.

More…

 

EU Faces Greek Democracy in Great Euro Poker Game – UKIP Leader Nigel Farage

 

Jim Sinclair’s Commentary

Sure they do and sure they will continue to do.

Greek Banks Need More Emergency Funds

(Bloomberg) — Greek lenders are urging central bank Governor Yannis Stournaras to seek additional emergency cash as deposit outflows accelerate, according to three people familiar with the situation.

Deposit withdrawals picked up after talks between Greece and its euro-area creditors on extending its bailout ended in acrimony in Brussels Monday night, said the people, who asked not to be identified because the information is private. Stournaras meets European Central Bank Governing Council colleagues in Frankfurt tomorrow as Greek banks exhaust their current allocation of emergency funds, the three people said.

The lenders, unable to tap investors for funds, are bleeding deposits amid uncertainty over their country’s future in the euro area and concern capital controls might be used to stem outflows. Banks are being kept afloat through the Emergency Liquidity Assistance lifeline extended by the Bank of Greece, subject to approval by the ECB. The ELA pool, which currently stands at 65 billion euros ($74 billion), is extended to solvent lenders as a temporary measure to cover liquidity shortages.

A Bank of Greece spokesman declined to comment.

Greek daily Kathimerini reported last week that deposit withdrawals in January and the beginning of February totaled 15 billion euros, indicating total deposits have dropped to 145 billion euros from 160 billion euros at the end of 2014.

More…

 

Jim Sinclair’s Commentary

Reason for the take down to discredit this action?

Greek Investors Buying More Gold Coins From U.K. Royal Mint
by Eddie Van Der Walt

(Bloomberg) — Greek demand for gold coins is rising as investors search for a safe haven from the country’s political turmoil, according to the U.K. Royal Mint.

“There has been a noticeable increase in demand in this last quarter,” Lisa Elward, head of bullion sales at the Royal Mint, said in an e-mail to Bloomberg News. “We tend to see an upsurge in sales at times of political and financial uncertainty.”

Greek investors are turning to gold with the nation heading toward a standoff with creditors over its international bailout program, fueling speculation that it may break its membership with the euro. The Royal Mint declined to provide exact sales figures for the gold coins, known as Sovereigns.

The Bank of Greece sold 5,849 Sovereign coins in January, according to an e-mail from the central bank, which said the numbers do not show any “abnormal activity.” While it didn’t provide monthly figures for comparison, government data show sales of 7,857 coins in the last quarter of 2014.

Greece’s bonds and stocks fell on Monday as Prime Minister Alexis Tsipras said in an address to parliament on Sunday that he still plans to ditch an existing funding plan that ends on Feb. 28. The three-year note yield rose 3.24 percentage points to 21.24 percent at 4:54 p.m. London time.

More…

 

NATO, QE, Siriza, the Ukraine, Israel: Highways towards « tomorrow’s world » on the horizon

The terrible 2014 Ukrainian crisis should be understood as an absolute limit beyond which the “world before” disappears no matter what. It will either disappear in the chaos and radicalization of the system which, in doing so, will cease to be itself, or it will disappear by opening up to the new characteristics of the “world afterwards”… the whole question can simply be summarized as this: war or peace? But in any case, the world-before is over!

And the fact is that as soon as the dust of battle settles a little, we are finally beginning to see the landscape of tomorrow’s world in the distance and the paths leading to it, sometimes again demonstrating the appearance of real highways. Even if our team remains very concerned about the obstacles which may arise on the way to these paths, we believe that the gradual revelation of the future landscape is something good. Indeed, the great dramas of history often happen when people or systems see no way out of their difficulties.

Thus, in this issue, at risk of seeming seriously naive, our team has decided to focus on these parts of the future appearing on the horizon. The object of political anticipation is also to downplay the future. The fight in which we are engaged and of which the Ukrainian crisis is the most emblematic concrete expression, only opposes the forces wishing to commit themselves to these paths and those wishing to prevent them.

More…

 

Jim Sinclair’s Commentary

How does historical dove Chair Yellen react to the “D” word, Deflation?

US Producer Prices Tumble Most Since 2009 (And It Wasn’t All Energy-Related)
Submitted by Tyler Durden on 02/18/2015 08:39 -0500

The drop in the price of energy will be initially blamed for the 0.8% MoM drop in Producer Prices Final Demand (far more than 0.4% drop expected) and the most on record. However, ex-food-and-energy, PPI also fell 0.1% (missing expectations of a 0.1% rise) and ex-food-and-energy-and-trade-services, PPI fell 0.3% – so it’s not just the energy price drop (even though fuels and lubricants dropped 9.3% MoM). In fact the biggest MoM drop was in furnishings, computer hardware, and TV, video, and photo equipment.

PPI Final Demand saw its biggest MoM drop on record…

clip_image001

Perhaps just as problematic for The Fed… YoY PPI is unchanged – its worst level on record…

clip_image002

PPI Ex-food-and-energy also dropped – missing expectations of a 0.1% rise…

clip_image003

And while it will come as no surprise to anyone that final demand for goods cratered as a result of the tumble in crude prices which now appears to have reversed, it was a surprising drop of -0.2% in Final Demand Services that some may have a problem explaining:

More…

 

ISIS plans to invade Europe through Libya – report
Published time: February 18, 2015 10:14 
Edited time: February 18, 2015 15:08

ISIS’ plans to conquer Europe via Libya have been revealed in letters seen by an anti-terrorism group. Owing to its perfect location on the continental doorstep, the terrorists plan to ferry fighters from North Africa across the Mediterranean.

The plans, analyzed by anti-terrorism British think tank Quilliam, outline a strategy to illegally ferry fighters across the sea from Libya into southern Europe, into ports such as Italy’s southernmost island of Lampedusa, less than 300 miles (483km) away.

Libya “has a long coast and looks upon the southern Crusader states, which can be reached with ease by even a rudimentary boat,” an Islamic State (IS, formerly ISIS/ISIL) propagandist says in the letters seen by Quilliam, according to the Telegraph.

That information originates from an IS supporter using the moniker Abu Ibrahim al-Libim. The propagandist is believed to be a strong force in IS recruitment online, with a focus on Libya.

The Telegraph could not independently confirm his identity, but the online recruiter is believed by analysts to be a great inspirer of troops and is widely-read.

More…

 

Jim Sinclair’s Commentary

Intervention is a short term solution.

Obama to Intervene in Dispute at West Coast Ports
By ERIK ECKHOLMFEB. 14, 2015

LOS ANGELES — Seeking an end to a protracted labor dispute that has led to costly delays in West Coast shipping, President Obama has decided to intervene, the White House announced on Saturday.

At the president’s request, Thomas E. Perez, the secretary of labor, will travel to California to “meet with the parties to urge them to resolve their dispute quickly at the bargaining table,” according to a statement issued by Eric Schultz, a White House spokesman. Mr. Perez will try to mediate a settlement between an association of the major shipowners of the West Coast and the union of longshoremen who unload those ships, which collectively bring in half the nation’s imported cargo.

The White House statement said the president was acting “out of concern for the economic consequences of further delay” and added, “Secretary Perez is already in contact with the parties and will keep the president fully updated.”

The unusual decision to intervene in contract negotiations came as American retailers, the U.S. Chamber of Commerce and agricultural exporters said they had already lost hundreds of millions of dollars because of mounting port congestion, with spare parts and consumer products from Asia not arriving on time and exports like oranges and apples left to rot.

More…

Posted at 10:33 AM (CST) by & filed under Jim's Mailbox.

Jim,

Andrew nails it. The manipulators are manipulating and the riggers are rigging. As long as there is outside control in the markets there is no reason to trust what the markets will do.

CIGA LarryM

Greece Will Default-Calamity Follows-Andrew Hoffman
By Greg Hunter On February 18, 2015 I

Financial writer Andrew Hoffman says the debt problem in Greece will not have a happy ending. Hoffman contends, “More than half of Greek debt, everyone talks about the 400 billion euros they owe, more than half of this debt is from the bailouts in the last four years. . . . Two years ago, I wrote that Greece was my top pick to catalyze the big one, and here we are in that same position. . . . If there is an agreement, it is only going to be bad for everybody.  It’s going to bad for Europe and bad for Greece.  Of course, if there is no agreement, then there is your end game right there.  They are not just going to leave the euro; they are going to default on their debt.  That is the only way Greece can be saved.  It is the only way Greece can be saved, and it is the same just about everywhere else. . . . I can’t see any deal they could make.”

On physical gold and silver, Hoffman points out, “We are seeing record demand around the world.  2013 was a record year.  2014 was a record year, and starting 2015, gold imports in China have been 50% above last year’s levels to start this year.  There is going to be a supply response . . .  just look at the earnings of the gold mining companies; they are decimated. . . . I predicted Armageddon.  I think they are all going to merge, and they are going to cut whatever is left of their businesses to the bone.  There is going to be no supply out there, particularly in silver, and it is all happening at a time when demand is surging.  That’s why it makes the ability of this cartel, the same people that are printing the money, to keep gold and silver prices in check all that more tenuous.”

More…

 

Jim

It looks like Euroland is exercising its legs, getting ready to kick the can down the road.

CIGA LarryM

Greece says will submit loan extension request on Wednesday

ATHENS (Reuters) – Greece’s government confirmed it would ask on Wednesday for an extension to its loan agreement with the euro zone, which it distinguishes from its full bailout program, but faced strong opposition from Germany.

The new government refuses to seek an extension of the EU/IMF bailout program, which is due to expire on Feb. 28, because of its demands for austerity policies, but wants to renegotiate Greece’s debts separately.

Government spokesman Gabriel Sakellaridis stressed the request would cover only the debt issue.

“Let’s wait today for the request for an extension of the loan contract to be submitted by Finance Minister (Yanis) Varoufakis,” he told Antenna TV when asked if an initial draft text rejected at a meeting of euro zone finance ministers this week would form the basis of the proposal. “All along deliberations are going on to find common ground. We want to believe that we are on a good path. We are coming to the table to find a solution.”

More…

 

Jim,

When the Russians sell their holdings of US Treasuries (and it’s not just the Russians), it floods the market and prices for them fall (yield rise).

The US can’t afford to have interest rates rise. It would kill an already weak economy.

So… the Fed must buy them (and print more money for the purchases).

More money printed equals Gold going higher. It’s quite simple.

CIGA Wolfgang

Wolfgang,

This comes on when there is any reduction in the hedge fund bond buying and algos pushing bonds lower.

Jim

Russia Dumps Most US Paper Ever As China Reduces Treasurys Holdings To January 2013 Levels
Submitted by Tyler Durden on 02/18/2015 17:02 -0500

Back in December, Socgen spread a rumor that Russia has begun selling its gold. Subsequent IMF data showed that not only was this not correct, Russia in fact added to its gold holdings. But there was one thing it was selling: some $22 billion in US Treasurys, a record 20% of its total holdings, bringing its US paper inventory to just $86 billion in December – the lowest since June 2008.

clip_image001

It wasn’t just Russia: the country that has ever more frequently been said to be in the same camp as Russia – and against the US – namely China, also sold another $6 billion in Treasurys in the last month of 2014, which would have made its US treasury holdings equal with those of Japan, if only Tokyo hadn’t also sold over $10 billion in the same month.

clip_image002

And while we know that Russia used at least some of the proceeds to buy gold, the bigger question is: just what is China buying with all these stealthy USD-denominated liquidations, and how much gold does the PBOC really have as of this moment.

More…

Posted at 4:30 PM (CST) by & filed under In The News.

Latest Greek Negotiations Fall Apart; Risk Slides After Greece Says “Won’t Take Orders On Bailout”
Submitted by Tyler Durden on 02/16/2015 21:20 -0500

UPDATE: *EU FINANCE MINISTERS’ TALKS WITH GREECE OVER FOR TODAY, GREECE SAYS WON’T TAKE ORDERS ON BAILOUT

EU President Jeroen Dijsselbloem to explain just how far apart they are now…

*  *  *

Dijsselbloem headlines:

*DIJSSELBLOEM SAYS MINISTERS WERE DISAPPOINTED BY WEEKEND TALKS
*DIJSSELBLOEM SAYS BEST WOULD BE EXTENSION FOR GREEK PROGRAM
*DIJSSELBLOEM SAYS EXTENSION WOULD ALLOW FLEXIBILITY FOR GREECE
*DIJSSELBLOEM SAYS EXTENSION WOULD INVOLVE COMMITMENTS
*DIJSSELBLOEM SAYS WOULD NEED AGREEMENT TO ROLL BACK MEASURES
*DIJSSELBLOEM SAYS WE STAND READY TO CONTINUE DISCUSSIONS
*DIJSSELBLOEM SAYS IT’S UP TO GREECE TO DECIDE ON EXTENSION
*DIJSSELBLOEM SAYS COULD BE EXTRA EUROGROUP ON FRIDAY
*DIJSSELBLOEM SAYS WE HAVE THIS WEEK, BUT THAT’S ABOUT IT

So the 10-day ultimatum was just extended by 40%? Clearly The EU is worried.

*  *  *

Well that didn’t last long. It seems – just as earlier in the week – the ability for either side in this Euro-system death match game of chicken to find any common ground to even start negotiations remains lost:

GREEK GOVT OFFICIAL SAYS THAT “IN THESE CIRCUMSTANCES, THERE CANNOT BE A DEAL TODAY”

EUROGROUP DISCUSSED “UNREASONABLE”, “UNACCEPTABLE” DRAFT TEXT INSISTING ON EXTENDING BAILOUT

More…

 

Former White House Budget Director Warns Greek Crisis Now Threatening The Entire Global Financial System
February 17, 2015

With talks between the EU and Greece reaching the boiling point, the former White House Budget Director warned that the Greek crisis is now a threat to the entire global financial system.

Former White House Budget Director, David Stockman:  “The Greeks owe something like $350 billion.  $60 billion of it is owned by Greek banks.  The rest of it is (owned by) the EU — $210 billion — and another $30 or $40 billion by the IMF.

So the issue in the short-run is the taxpayers in all the countries of the EU…because the debt has been transferred from the banking system — that’s what all these bailouts were about — to the taxpayers of the EU.

More…

Posted at 1:19 PM (CST) by & filed under Jim's Mailbox.

Jim,

The world, at least Russia (Rosneft), is wise to the ways of the west.

Oil rigging linked to gold rigging.

As with gold, the longer oil prices are kept artificially low, the higher they will rebound.

CIGA Wolfgang

CEO Of Rosneft Compares Oil Market Manipulation Which “Doesn’t Reflect Reality” To Gold Price Rigging
02/16/2015 19:33 -0500

What we most certainly do agree with, is his broader message, namely that financial speculation has made a mockery of physical supply and demand and “distorted oil markets, prices do not reflect reality. They are driven instead by financial speculation, which outweighs the real-life factors of supply and demand. Financial markets tend to produce economic bubbles, and those bubbles tend to burst. Remember the dotcom bust and the subprime mortgage crisis? Furthermore, they are prone to manipulation. We have not forgotten the rigging of the Libor interest rate benchmark and the gold price.”

Yes indeed, the CEO of an oil major just used gold rigging as an example of the same commodity manipulation that gold longs have been complaining about for years if not decades.

Here is Igor Sechin full Op-Ed in the FT

In 1985, investing in a new well was worthwhile if the oil it produced would fetch between $20 and $30 a barrel. Now, more oil comes from wells that are tricky and expensive to build; the break-even price is closer to $60 or $100.

More…

 

Jim,

I can’t believe the European banksters and politicians can be that stupid and ignorant to what might happen to the EU in the event that Greece does not come to an agreement with the EU. Crash! Bang ! Boom! They have everything to lose and are afraid because Germanys’ citizens might replace Angela Merkel in the coming election if they feel that Germany got stuck with the lion’s portion of Greece’s default.

CIGA LarryM

Greece bailout: Varoufakis ‘willing’ as talks collapse
16 February 2015 Last updated at 22:27

Greece’s Finance Minister Yanis Varoufakis declared he was ready to do “whatever it takes” to reach agreement over its bailout after the collapse of talks with EU finance ministers.

Mr Varoufakis spoke after Greece rejected an EU offer to extend its current €240bn (£178bn) bailout, a plan he called “absurd” and “unacceptable”.

He said he was prepared to agree a deal but under different conditions.

But the Dutch finance minister said there were just days left for talks.

More…