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



Have They Decided To “Get Out Of The Way?”
Author : Bill Holter
Published: April 9th, 2014

Yesterday the Wall Street journal wrote that Goldman Sachs may be in the process of shutting down their “Sigma X” dark pool clearing.  Little more than 2 weeks ago they first announced that they would no longer “play” in the HFT games and followed this by announcing they would give up their “Designated Market Maker” status on the NYSE.  Why, what’s up with this?

Speculation on my part but it seems to me like “they know.”  They know that something VERY BIG is afoot.  This “something” could be one of many possibilities but a firm like Goldman Sachs who has gorged at the table of American financial plenty forever would never ever leave if there was still food at the table.  Please remember that they are second only to JPM with their “trading” prowess over the last few years.  They have had less than a handful of “losing days” while JPM has had 1,300+ straight days of trading gains without a single loss.  I have written on this before and won’t go into it again but I will say that this is absolutely impossible.  This track record could never mathematically or statistically happen except where the casino is “rigged” with an iron fist.

Maybe this is exactly what Goldman is looking at.  Maybe they see that the “iron fist” is just beginning to or will lose its grip?  Maybe they see that regulators cannot look the other way anymore?  Maybe their “profits” have gotten skinny and they are making a business decision that the only thing left is bone as the flesh and muscle have already been consumed?  Maybe they feel like they are expending too much “effort” and not being “paid” for this effort.  Maybe they feel like there are just too many markets with “loose threads” hanging out there to keep track of?  Maybe they feel like the “weight” of painting all markets 24/7 to keep the rig in place has gotten too heavy for them?  Or, maybe it’s a little of all of the above and they know what is coming and have decided to simply “get out of the way?” “Getting out of the way” would be my guess.

Thinking back to 2003 or ’04, Rothschilds made this decision regarding gold and exited the “London price fix” arrangement in my opinion because they knew what was coming.  They knew that the “pressure” was to the upside and decided to no longer lean against it.  I believe that Goldman understands that what is coming will take almost everything with it.  There will be no “bail outs” this time and there will be no “TARP’s” because the funds available and the ability of governments to sack the Treasuries (again) no longer exists…they are broke.  I believe that Goldman is adopting the “every man for himself” strategy and pulling in their horns.  They don’t want their capital “in the way” and are simply withdrawing it similar to a player standing up and walking away from the poker table.

The thing is this, Goldman was the “house” or at least was betting with the house and they obviously see that something is wrong.  I believe that they understand that everything is “mispriced.”  Not just mispriced but grossly mispriced and that their trading played a huge part in the “mispricing” as they provided capital used to push, pull, smash and levitate the various markets.  I have said all along that the markets were all, each and every market, part of a grand “painting.”  This painting has been used by Washington and Wall Street (and their foreign counterparts) to point to as proof that their policies were working.  LOOK! They would say at the stock market…or interest rates or what have you as proof that “all is well.”


De-invest from the West: Russia urges companies to return assets to the motherland
Published time: April 09, 2014 12:08

As the US and Europe escalate talks of sanctions, Russia is recommending companies unregister abroad and bring their shares to the Moscow Exchange to protect from possible future sanctions and provide economic security.

“Companies that have listed shares on the New York Stock Exchange, London need to seriously reconsider,” Russia’s Deputy Prime Minister Igor Shuvalov told reporters in Moscow on Tuesday.

Sanctions by the West have ramped up over the geopolitical action in Ukraine, and Russian business and politicians have been the target of asset freezes and visa bans.

The government will not force companies to delist and return to Russia, but Shuvalov said the Russian state and the Moscow Exchange will work together to create “attractive conditions” for companies to make the switch.

“This is a question of economic security,” the minister said. The US continues to ramp up economic sanctions against Russia, which has spooked investors and resulted in a massive $70 billion outflow of capital since the beginning of 2014, according to Economics Minister Andrei Klepach.


Israel’s PM Office voices extreme disappointment in Kerry
DEBKAfile April 9, 2014, 6:03 PM (IDT)

A high-ranking member of Binyamin Netanyahu’s bureau issued a statement Wednesday expressing “extreme disappointment with US Secretary John Kerry for putting on Israel the blame” for the breakdown of Middle East peace talks.  “Kerry knows perfectly well that the Palestinians repeatedly interrupted the talks with refusals to carry on, said ‘no’ to dialogue with Israel, rejected his own framework proposal for the extension of talks,  and refused to address Israel as the Jewish national state.”  The Israeli official reminded the US Secretary that the Palestinians refused even to meet him, or even consider prolonging the negotiations.

By letting the Palestinians off the hook, Kerry encourages them to harden their rejectionist attitude and so undermine the chances of the talks getting anywhere, the official said. He added Israel was willing to continue peace efforts, but would also take its own unilateral steps in response to Palestinian unilateral actions. Wednesday, Netanyahu ordered government ministries to suspend cooperation with the Palestinian Authority and its heads.



Long-Term Unemployment Trend for Older Workers Is Terrifying
By Amanda Alix
April 6, 2014

Even as the national unemployment rate has remained elevated compared to its pre-financial-crisis level, workers aged 55 years and older have enjoyed a much lower rate of joblessness when compared with younger Americans.

Unfortunately, this scenario is a double-edged sword. While many employees of the baby boomer generation lucky enough to have secure jobs are continuing to work, often past the traditional retirement age of 65, those who lose their jobs during midlife are not so lucky. Many of these workers are now faced with becoming a special subset of the long-term unemployed: the permanently jobless.

A desperate situation
Being out of work for 27 consecutive weeks will earn you the moniker "long-term unemployed", but for older workers, the situation is more dire. While many younger workers experience loss of employment for about 34 weeks, those over 55 suffer joblessness for an average of 45 weeks.

Why are things so very tough for the older crowd? A few theories exist, all of which have some merit. Some point to age discrimination, noting that complaints filed with the Equal Employment Opportunity Commission have shot up markedly since the onset of the financial crisis. Others note that employers doubt older workers’ ability to catch up with workplace technology, or worry that their skills have become too rusty overall.


Moldova’s breakaway region ‘dreams of being with Russia’: leader
April 7, 2014 5:37 PM

Chisinau (AFP) – The leader of Moldova’s pro-Moscow breakaway region on Monday urged the country’s politicians to start discussions that would allow Transdniestr to formally join Russia.

"Our dream is a prosperous independent Trasndniestr together with Russia," Yevgeny Shevchuk said in a state of the nation address.

"The time for solutions over Trasndniestr has come," he added in the hour-long speech.

Pro-Western Moldova warned Moscow last month against trying to annex its Russian-speaking region after Trasndniestr officials appealed to be brought under the Kremlin’s control.

Chisinau’s warning came in the wake of Moscow’s takeover of Ukraine’s Black Sea peninsula of Crimea after locals voted to split from Kiev last month.

"I propose that Moldova’s politicians make a wise, bold and responsible move and start discussing how to legally formalise the real state of affairs," Shevchuk said.

The move, he said, would strengthen stability in the region.


Fed dropped jobless target in secret meeting
April 9, 2014, 2:00 p.m. EDT
By Greg Robb

WASHINGTON (MarketWatch) — Federal Reserve officials had a secret video conference call in early March to discuss overhauling its communication to the market and reached a general consensus that the 6.5% unemployment rate threshold for the first rate hike was outdated, the central bank said Wednesday. A summary of the video conference was included in the minutes of the Fed’s March 18-19 meeting released by the Fed. On the conference call, the central bankers were clearly worried that changing the forward guidance would impact markets. They noted that, going into the video conference, the Fed and the markets were on the same page about the outlook for short-term interest rates. The minutes of the March 18-19 meeting also reveal that there was concern that the markets would read too much into the "dot plot" which showed an upward shift in the Fed’s expectations for short-term rates. Officials also spelled out headwinds that would keep rates low even after the first rate hike. These headwinds included higher precautionary savings by consumers.


Minutes Show Fed Struggled To Agree On Rate Policy
Wednesday April 9, 2014 2:02 PM

WASHINGTON (AP) — The Federal Reserve struggled last month over how to convey to investors the pace at which it will raise short-term interest rates once it increases them from record lows.

Two weeks before the Fed’s regular meeting March 18-19, it held an unusual and previously unannounced videoconference to debate the issue, according to minutes of the meeting released Wednesday.

In the end, the Fed settled on an open-ended approach: That even after employment and inflation are nearly back to normal, short-term rates may need to stay unusually low for a while because the economy isn’t fully healthy.

Stock and bond investors read the minutes to signal that the Fed plans to favor low short-term rates longer than many had assumed. Stocks rose sharply after the minutes were released, and bond yields fell. The Dow Jones industrial average, which had risen modestly before the minutes were released, was up 154 points 30 minutes later.

Investors have been intensely following the Fed’s guidance on rates because higher short-term rates would elevate borrowing costs and could hurt stock prices.

The minutes covered the first Fed meeting at which Yellen presided as well as the March 4 videoconference. At both sessions, the issue of the language the Fed uses in its statements to signal the timing of future policy actions was a topic of extended debate.


Gold Erases Losses After Fed Meeting Minutes Released
By Debarati Roy
April 09, 2014 2:16 PM EDT

Gold erased declines after minutes from the Federal Reserve’s March meeting showed several policy makers said a rise in their median projection for the main interest rate exaggerated the likely speed of tightening.

“Several participants noted that the increase in the median projection overstated the shift in the projections,” the minutes of the March 18-19 Federal Open Market Committee meeting showed. Fed Chair Janet Yellen said last month that the central bank may end its debt-buying program this year and raise interest rates in 2015.

Gold slid 28 percent in 2013, partly as the outlook for less monetary stimulus dimmed the appeal of metal as an inflation hedge. Prices rebounded this year, climbing 8.9 percent through yesterday, partly as U.S. economic growth faltered.

“The Fed sounds less hawkish than it did last month, which is good for gold,” Michael Gayed, the chief investment strategist at Pension Partners LLC, said in a telephone interview. “The market is confused because there are so many contradicting signals from the Fed.”

Gold for immediate delivery gained less than 0.1 percent to $1,309.12 an ounce at 2:15 p.m. New York time. Earlier, prices fell as much as 0.6 percent.

The precious metal jumped 70 percent from December 2008 to June 2011 as the Fed bought debt and cut interest rates to a record in a bid to boost the U.S. economy.


Spot gold pares losses after Fed minutes; futures end lower

Spot gold pared earlier losses on Wednesday after the minutes of the U.S. Federal Reserve’s latest policy meeting showed the central bank struggled over how to convey to investors how fast it will raise short-term interest rates once it increases them from record lows.

The Fed held a previously unannounced March 4 videoconference to debate the issue in advance of its regular March 18-19 meeting.

Spot gold was last at $1,312 an ounce, up 0.3 percent and off an earlier high of $1,314 an ounce. U.S. gold futures for June delivery settled $3.20 lower at $1,305.50 an ounce ahead of the Fed announcement,

Worries over Ukraine, as well as technical momentum after a break above $1,300, helped lift gold nearly 1 percent on Tuesday, but uncertainty over U.S. monetary policy and weak physical and investment appetite curbed that rally.


U.S. Stocks Rise as Fed Minutes Ease Concern on Rates
By Callie Bost
April 09, 2014 2:31 PM EDT

U.S. stocks rose, after the Standard & Poor’s 500 Index yesterday snapped a three-day slide, as minutes from the Federal Reserve’s last meeting eased concern about the timing of future interest rate hikes.

Alcoa Inc. (AA) advanced 3.6 percent after earnings topped estimates and the company forecast that global demand for aluminum will exceed production this year. Facebook Inc. climbed 5.6 percent, extending a rebound in technology stocks after a selloff. Regeneron Pharmaceuticals Inc. surged 5.8 percent as shares of biotechnology companies rallied the most in seven sessions.

The S&P 500 gained 0.9 percent to 1,868.85 at 2:30 p.m. in New York. The Nasdaq 100 Index climbed 1.4 percent, after a 0.9 percent advance yesterday. The Dow Jones Industrial Average increased 152.49 points, or 0.9 percent, to 16,408.63. Trading volume of S&P 500 stocks was in line with the 30-day average at this time of day.

“These minutes are calming for the markets,” Jeffrey Kleintop, chief market strategist at LPL Financial LLC, which manages about $414 billion, said by phone from Boston. “It was clearly stated that the projections overstated the likely shift in rates. A slower pace of interest rates seems more likely here than from the statements.”

Several Fed policy makers said a rise in their median projection for the main interest rate exaggerated the likely speed of tightening, according to minutes of their March 18-19 meeting released today.


Jim Sinclair’s Commentary

The Secretary doth protest too much.

Kerry: Administration’s Foreign Policy Not ‘Spinning Out of Control’
April 8, 2014 – 7:31 PM
By Patrick Goodenough

( – Secretary of State John Kerry took exception Tuesday to an assertion by a Republican senator that the Obama administration’s foreign policy is “spinning out of control,” declaring that “that’s just not true.”

“You can’t help but get the impression our foreign policy is just spinning out of control,” Sen. Jim Risch (R-Idaho) said during a Senate Foreign Relations Committee hearing on the State Department budget. “And we are losing control in virtually every area that we are trying to do something in.”

Risch cited developments in Russia, Iran, North Korea, Afghanistan, Pakistan, China and the Israeli-Palestinian negotiations – but focused on the Russia-Ukraine situation.

“This administration said they were going to hit the reset button [with Moscow] and I can’t help think that somebody hit the wrong button,” he said.

The Russians were behaving “worse than they have in decades,” Risch said, pointing to Russia’s continued presence in Georgian territory it seized in 2008, its current actions in Ukraine, and its support for the Assad regime in Syria as tens of thousands continue to die.





Dr. Paul Craig Roberts: Gold and The Dollar Are In A Fight to the Death!


Donetsk’s pro-Russian activists prepare referendum for ‘new republic’
Protesters declare Kiev government illegitimate and fire its officials appointed to east Ukraine region
Alec Luhn in Donetsk
The Guardian, Tuesday 8 April 2014 15.56 EDT

Irina Grinenko rushed through the barbed-wired barricades and into the occupied regional administration building in Donetsk, rolls of toilet paper in one hand and a bag of bandages in the other.

"If they attack us, I will bandage people," the pro-Russian protester said, adding that she expected an assault by non-local law enforcement personnel.

"We will be here until the end, until they beat us out or meet our demands … I want an autonomous region on good terms with Russia," she added.

Pro-Russian protesters built new barricades and dug in for a long occupation of the administration building on Tuesday, readying themselves for expected "provocations" by Ukrainian police or demonstrators sympathetic to the Euromaidan protests and to the new government in Kiev.

Meanwhile, a loosely organised temporary government inside the building began laying the groundwork for a referendum on the "sovereignty" of the newly declared Donetsk republic, which it plans to hold simultaneously with similar referendums in Lugansk and Kharkiv some time before 11 May.

At a session on Tuesday afternoon, the temporary body declared illegitimate the regime that had "violently usurped" the government in February, and announced it was firing all the officials it had appointed in Donetsk.


Russia to meet EU and US for talks over Ukraine crisis
Top-level talks scheduled for next week as tense standoff with pro-Russia separatists continues in eastern Ukraine
Shaun Walker, Wednesday 9 April 2014 08.18 EDT

The Ukrainian authorities have said they will end the occupation of administrative buildings by pro-Russian separatists in the east of the country, either by negotiations or force, within 48 hours, as four-way talks between Russia, Ukraine, the US and the EU were announced for next week in an attempt to defuse the tense situation.

"A resolution to this crisis will be found within the next 48 hours," said the interior minister, Arsen Avakov, in Kiev, referring to the eastern cities of Luhansk and Donetsk where protesters remained in control of government buildings.

"For those who want dialogue, we propose talks and a political solution. For the minority who want conflict, they will get a forceful answer from the Ukrainian authorities," he said.

In Luhansk, the protesters did not appear in the mood to compromise, and on Wednesday they were reinforcing the barricades around the security services building they have seized and preparing petrol bombs.

In Donetsk, protesters remain in control of the local administration building, from where on Monday they proclaimed Donetsk an independent republic and said they would hold a referendum within a month on the region’s status and whether it should appeal to join Russia.


Ukraine tries to quell pro-Moscow uprisings

DONETSK, Ukraine (AP) — Ukrainian authorities moved to quell pro-Moscow uprisings along the Russian border with mixed results Tuesday, retaking one occupied regional headquarters and watching protesters consolidate their hold on another.

In a third city, Luhansk, Ukraine’s Security Service said separatists armed with explosives and other weapons were holding 60 people hostage inside the agency’s local headquarters.

Those occupying the building issued a video statement saying they want a referendum on the region’s status and warning that any attempt to storm the place would be met with armed force.

In the video, posted by Ukrainian media, a masked man identified the occupiers as Ukrainian veterans of the Soviet war in Afghanistan and said that if authorities try to retake the building, "Welcome to hell, then!"

The Ukrainian government and the U.S. have accused Moscow of fomenting the unrest as a pretext for another Russian military incursion like the takeover of Crimea last month. Up to 40,000 Russian troops are massed along the Ukrainian border, according to NATO.


Jim Sinclair’s Commentary

Each step forward for the Chinese currency is a small step backwards for the US dollar.

Central banks’ investment in yuan puts currency nearer reserve status
Investment by dozens of central banks comes despite currency not being fully convertible
PUBLISHED : Monday, 07 April, 2014, 4:38am
UPDATED : Monday, 07 April, 2014, 6:24pm
Jeanny Yu in Singapore

At least 40 central banks have invested in the yuan and several others are preparing to do so, putting the mainland currency on the path to reserve status even before full convertibility, Standard Chartered said.

Twenty-three countries have publicly declared their holdings in yuan, in either the onshore or offshore markets, yet the real number of participating central banks could be far more than that, said Jukka Pihlman, Standard Chartered’s Singapore-based global head of central banks and sovereign wealth funds.

Pihlman, who formerly worked at the International Monetary Fund advising central banks on asset-management issues, said at least 12 central banks had invested in yuan assets without declaring they had done so.

The US dollar is still the world’s most widely held reserve currency, accounting for nearly 33 per cent of global foreign exchange holdings at the end of last year, according to IMF data. That ratio has been declining since 2000, when 55 per cent of the world’s reserves were denominated in US dollars.

The IMF does not disclose the percentage of reserves held in yuan, but the emerging market countries’ share of reserves in "other currencies" has increased by almost 400 per cent since 2003, while that of developed nations grew 200 per cent, according to IMF data.

Pihlman said "a great number of central banks are in the process of adding [yuan] to their portfolios".

"The [yuan] has effectively already become a de facto reserve currency because so many central banks have already invested in it," he said. "The [yuan] may become a de facto reserve currency before it is fully convertible."


Posted at 3:16 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

The latest from John Williams’

- Economic Reality versus Illusion: No Recovery, Just Plunge, Stagnation and Renewed Plunge
- Re-Intensifying Downturn Already Underway
- Confluence of Negative Surprises, Including New Business and Systemic Woes, Should Hit U.S. Dollar and Spike Inflation
- Hyperinflation to Intensify Unfolding Depression
- Gold as a Store-of-Wealth and Safe-Haven Remains Primary Hedge for Maintaining Purchasing Power of Wealth and Assets

"No. 617: SPECIAL REPORT: 2014 ShadowStats Hyperinflation Report — Second Installment"

Jim Sinclair’s Commentary

The battlefield is here.



Plans for EU gas flows to Ukraine could be blocked by Russia
By Alexander WinningApril 7, 2014 11:30 AM

LONDON (Reuters) – Reverse flows of natural gas from Europe to Ukraine to help it handle Russian price increases and supply cuts would be possible within hours once the infrastructure is in place, but the flows could require approval from Russia’s Gazprom first.

Ukraine is in emergency talks with the EU on importing gas from the West, pumping gas in the opposite direction to the original design of the pipelines, following a leap in the price Gazprom charges it for supplies.

Relations between Ukraine and Russia have been in crisis since popular protests in Kiev ousted pro-Russian president Viktor Yanukovich in February, after which Russia seized Ukraine’s Crimea region and formally annexed it last month.

Slovakia is the EU’s best-placed country to pump gas to Ukraine should Russia cut supplies, but reversing flows along any of the four pipelines that take Russian gas to Slovakia via Ukraine would breach the terms of its contracts with state-controlled Gazprom, a spokesman for Slovak pipeline operator Eustream said.

"For a reverse flow, you would have to stop the East-West flow in one of the (four) pipelines and reverse the flow. But you would have to have approval from Gazprom," the spokesman said.

"Gazprom does not agree with this (reverse flows), and thus it’s not an option," he added.

Gazprom Chief Executive Alexei Miller raised questions about the legality of reversing gas flows to Ukraine in an interview aired on Russian state television on Saturday.


Jim Sinclair’s Commentary

This could cause serious additional problems.

Ukraine Authorities Clear Kharkiv Building, Arrest Scores Of ‘Separatists’
April 08, 2014

Ukrainian authorities say a counterterrorist operation has cleared out "separatists" occupying a state administration building occupied by pro-Russians in the eastern city of Kharkiv.

Interior Minister Arsen Avakov said about 70 "separatists" were arrested.

Writing on his Facebook page, Avakov said the city center had been sealed off but that the subway was in operation.

Ukraine’s Interior Ministry was quoted by Interfax-Ukraine news agency as saying those detained were suspected of "illegal activity related to separatism, the organization of mass disorder, damage to human health" and breaking other laws.

After news of the operation early on April 8, Russia’s Foreign Ministry called on Kyiv’s authorities to stop massing military forces it claims are intent on suppressing anti-government protests in southeastern Ukraine.

"According to our information, units of the Interior troops and Ukraine’s national guards as well as militants from the illegal armed formation ‘Right Sector’ are being amassed in the southeastern parts of Ukraine and in the city of Donetsk,” the ministry said, according to ITAR-TASS.

It suggested U.S. mercenaries were involved. "We are particularly concerned that the operation involves some 150 American mercenaries from a private company Greystone Ltd., dressed in the uniform of the [Ukrainian] special task police unit Sokol," the ministry said.


US, allies warn North Korea amid reactor fears
By Shaun Tandon

Washington (AFP) – The United States and its allies warned North Korea against provocations as researchers reported potential radiation risks due to problems at the regime’s main nuclear complex.

The United States, South Korea and Japan, meeting in Washington after a new period of tension, condemned North Korea’s recent ballistic missile tests and called again for an end to the regime’s nuclear weapons program.

The three nations "urged the DPRK to refrain from further threatening actions," said a US statement, referring to the North by its official name of the Democratic People’s Republic of Korea.

South Korea has been on guard after North Korea’s young leader Kim Jong-Un warned last week of a "very grave" situation on the divided peninsula as he accused Seoul and Washington of trampling peace gestures through joint exercises.

In recent weeks, North Korea has test-fired medium-range ballistic missiles capable of hitting Japan, conducted a live-fire drill along its disputed border with South Korea and apparently flew three rudimentary drones over the border to peer at Seoul’s military facilities.


Small Business Hiring Plans Plunge To 11-Month Lows
Submitted by Tyler Durden on 04/08/2014 09:14 -0400

Having hit their most hopeful levels in seven years in January, small business hiring plans have collapsed at the fastest rate since Lehman in the ensuring 2 months. Despite the headlines proclaiming the modest rise and beat in the headline NFIB data, capex spending plans dropped and hiring expectations dropped to lows seen 11 months ago. We can only assume the small businesses are expecting more winter storms through the spring…



Posted at 2:07 PM (CST) by & filed under In The News.

CEO Of Liechtenstein Bank Frick Murdered In Broad Daylight
Submitted by Tyler Durden on 04/07/2014 10:05 -0400

Over the weekend the world was gripped by the drama surrounding the mysterious murder-homicide of the former CEO of Dutch bank ABN Amro and members of his family, and whether there is more foul play than meets the eye. However, that is nothing compared to what just happened in the tiny, and all too quiet Principality of Lichtenstein, where moments ago the CEO of local financial institution Bank Frick & Co. AG, Juergen Frick, was shot dead in the underground garage of the bank located in the city of Balzers.

Based on preliminary reports, the murder is the result of a disgruntled fund manager, Juergen Germann, who had previously been embroiled in a "bitter dispute" with the government and the bank. Bloomberg has more:

A 48-year-old man was shot dead in the underground garage of a financial institution in Balzers at 7:30 a.m. local time, the principality’s police said on its website. The suspect, Juergen Hermann, fled the scene in a Smart car with Liechtenstein number plates, according to police. Neither the victim nor the institution were identified in the statement.

The deceased was Juergen Frick, CEO of Bank Frick & Co. AG, Switzerland’s Radio 1 said in an e-mailed statement, citing employees of the bank. Calls to Bank Frick were answered by a voice-mail message saying the company is closed because of “a death.” It gave no further details.

Hermann is a fund manager who has been embroiled in a dispute with the Liechtenstein government and Bank Frick for many years, Switzerland’s Radio 1 said.

The Liechtenstein government and the country’s Financial Market Authority “illegally destroyed my investment company Hermann Finance and its funds, depriving me of my livelihood,” according to a website registered under the name Juergen Hermann of Hermann Finance AG.



Ukraine crisis escalates as pro-Russia activists declare independence in Donetsk
Protesters who have seized government building in eastern city vow to hold referendum, sparking fears of ‘second Crimea’
Shaun Walker in Moscow
The Guardian, Monday 7 April 2014 14.30 EDT

Pro-Russian activists in Ukraine’s industrial centre of Donetsk have proclaimed their independence from Kiev and pledged to hold a referendum in the next month, provoking fears that Moscow could be orchestrating a second Crimea scenario in Ukraine’s east.

"Seeking to create a popular, legitimate, sovereign state, I proclaim the creation of the sovereign state of the people’s republic of Donetsk," said a man into a loudspeaker outside the seized regional administration building to a cheering crowd.

The protesters said they would hold a referendum no later than 11 May on the region’s status, and also asked Russia to ready "peacekeeping troops", in a scenario reminiscent of the events that led to the annexation of Crimea last month.

In Kiev, the interim prime minister, Arseniy Yatsenyuk, said events in the east were being carried out according to a script written in Moscow.

"An anti-Ukrainian plan is being put into operation … under which foreign troops will cross the border and seize the territory of the country," Yatsenyuk told a cabinet meeting in Kiev. "We will not allow this."


US arms Syrian rebels with first heavy weapons, anti-tank BGM-71 TOW missiles – raising war stakes
DEBKAfile Exclusive Report April 7, 2014, 8:56 AM (IDT)

Two Syrian rebel militias judged moderate in Washington have in the last few days taken delivery and begun using – mostly in the Idlib region – the first advanced US weapon to be deployed in more than three years of civil war, debkafile’s military sources reveal. It is the heavy anti-tank, optically-tracked, wire-guided BGM-71 TOW, which is capable of piercing 50mm thickness of Syrian tank armor and Syrian fortifications at a range of 4 kilometers. Armed with this weapon now are Brig-Gen. Abdul-Hila al Bashir, the new commander of the rebel Free Syrian Army, which is headquartered at the Golan town of Quneitra, and Jamal Maarouf, head of the rebel Syrian Revolutionary Front fighting in the north.

The appearance of this advanced missile radically alters the balance of strength on the Syrian battlefield. It also denotes a striking change in Obama administration policy, which hitherto flatly resisted every demand to provide Syrian rebel groups with the heavy arms essential for them to have any chance of standing up to Bashar Assad’s superior military strength.

Our sources report that in the last few days, the new weapons are being airlifted in through two routes: the southeastern Turkish town of Diyarbakir on the Tigris, and the giant northern Saudi King Faisal Air Base at Tabuk near the Jordanian border.
US Gen. Martin Dempsey, Chairman of the Joint Chiefs, arranged during his visit to Israel last week for the Netanyahu government to waive a standing agreement between the US, Saudi Arabia and Israel, whereby Saudi Air Force F-15 fighters are not stationed in Tabuk given its proximity to Israeli air space.

Dempsey explained that they were needed as air cover for the American transports flying the new weapons in via Saudi, and the convoys ferrying them onward from the Saudi base to their destination in southern Syria through Jordan. Stationed at the Tabuk air base too is a squadron of French fighter jets.


Pro-Russian separatists proclaim “people’s republic” in E. Ukraine
DEBKAfile April 7, 2014, 10:53 PM (IDT)

In the eastern cit of Donetsk pro-Russian separatists seized the main government building, raised the Russian flag and declared the creation of an independent “people’s republic.  In Luhansk, one of several cities holding protests, pro-Russian demonstrators stormed the administration building. Prime Minister Arseniy Yatsenyuk accused Moscow of orchestrating the unrest as a pretext for invasion.


Kerry warns Lavrov of further costs for Russia
DEBKAfile April 7, 2014, 10:54 PM (IDT)

US Secretary of State John Kerry told Russian Foreign Minister Sergei Lavrov on Monday that Washington was watching events in eastern Ukraine with great concern and any further moves by Moscow to destabilize Ukraine – direct or covert – would "incur further costs for Russia." His spokesman called on Russia to publicly disavow activities of “separatists, saboteurs and provocateurs” in Ukraine. She said the two ministers discussed holding direct talks  between Ukraine, Russia, the US and the EU in the next 10 days to defuse tensions.


Obama Issues Threats To Russia And NATO
Paul Craig Roberts

The Obama regime has issued simultaneous threats to the enemy it is making out of Russia and to its European NATO allies on which Washington is relying to support sanctions on Russia. This cannot end well.

As even Americans living in a controlled media environment are aware, Europeans, South Americans, and Chinese are infuriated that the National Stasi Agency is spying on their communications. NSA’s affront to legality, the US Constitution, and international diplomatic norms is unprecedented. Yet, the spying continues, while Congress sits sucking its thumb and betraying its oath to defend the Constitution of the United States.

In Washington mumbo-jumbo from the executive branch about “national security” suffices to negate statutory law and Constitutional requirements. Western Europe, seeing that the White House, Congress and the Federal Courts are impotent and unable to rein-in the Stasi Police State, has decided to create a European communication system that excludes US companies in order to protect the privacy of European citizens and government communications from the Washington Stasi.

The Obama regime, desperate that no individual and no country escape its spy net, denounced Western Europe’s intention to protect the privacy of its communications as “a violation of trade laws.”

Obama’s US Trade Representative, who has been negotiating secret “trade agreements” in Europe and Asia that give US corporations immunity to the laws of all countries that sign the agreements, has threatened WTO penalties if Europe’s communications network excludes the US companies that serve as spies for NSA. Washington in all its arrogance has told its most necessary allies that if you don’t let us spy on you, we will use WTO to penalize you.

So there you have it. The rest of the world now has the best possible reason to exit the WTO and to avoid the Trans-Pacific and Trans-Atlantic “trade agreements.” The agreements are not about trade. The purpose of these “trade agreements” is to establish the hegemony of Washington and US corporations over other countries.


Gas wars: Ukraine due on $2.2 bn debt to Gazprom
Published time: April 07, 2014 10:29

Another potential gas war between Kiev and Moscow looms as Ukraine is due Monday to pay a $2.2 billion debt to Russia’s Gazprom. Ukraine’s PM has called the new gas prices ‘unacceptable’ and purely ‘political’.

“There has been no progress,” Financial Times quotes Gazprom’s spokesman, Sergey Kupriyanov, speaking in Kiev. "They are not paying anything, zero.”

“We cannot deliver gas for free, so they need to pay off the debt,” said Aleksey Miller, Gazprom chief executive has said.

“They also need to pay for 100 per cent of current supplies,” Miller said, adding that the situation “cannot continue indefinitely”. 
Gazprom and Kiev’s Naftogaz have a rocky payment and pricing history, and past tiffs have resulted in Moscow turning off the pipes, cutting off supplies to Europe.

However, a Gazprom spokesman said Monday that Russian gas exports to Europe through Ukraine remain stable despite a standoff between Moscow and Kiev, Reuters reports.


CEO Of Liechtenstein Bank Frick Murdered In Broad Daylight
Submitted by Tyler Durden on 04/07/2014 10:05 -0400

Over the weekend the world was gripped by the drama surrounding the mysterious murder-homicide of the former CEO of Dutch bank ABN Amro and members of his family, and whether there is more foul play than meets the eye. However, that is nothing compared to what just happened in the tiny, and all too quiet Principality of Lichtenstein, where moments ago the CEO of local financial institution Bank Frick & Co. AG, Juergen Frick, was shot dead in the underground garage of the bank located in the city of Balzers.

Based on preliminary reports, the murder is the result of a disgruntled fund manager, Juergen Germann, who had previously been embroiled in a "bitter dispute" with the government and the bank. Bloomberg has more:

A 48-year-old man was shot dead in the underground garage of a financial institution in Balzers at 7:30 a.m. local time, the principality’s police said on its website. The suspect, Juergen Hermann, fled the scene in a Smart car with Liechtenstein number plates, according to police. Neither the victim nor the institution were identified in the statement.


Protesters in three Ukraine towns call for “Russian peacemakers” 
DEBKAfile April 7, 2014, 6:33 PM (IDT)

Pro-Russian separatist protesters in the eastern Ukraine towns of Kharkiv, Donetsk and Luhansk called Monday on Vladimir Putin to send over “peacemakers” to secure their independence. Wearing military uniforms and steel helmets, they seized public buildings and set up barbed wire barricades. Prime Minister Arseny Yatseniuk accused “foreign troops” of stirring up unrest in the three embattled towns as part of a plan to destabilize Ukraine and bring in Russian troops.


Posted at 10:15 PM (CST) by & filed under In The News.

Banker leaps to his death in finance world’s 8th suicide this year
By Michael Gray
March 17, 2014 | 6:48pm

A 28-year old Manhattan investment banker has died in an apparent suicide, police sources said.

Kenneth Bellando, who worked at Levy Capital since January, was found dead on the sidewalk outside his East Side building on March 12 after allegedly jumping from the sixth-story roof, sources said.

Bellando, a former investment bank analyst at JPMorgan, is the son of John Bellando, chief operating officer and chief financial officer at Condé Nast. His brother, John, a top chief investment officer with JPMorgan, works on risk exposure valuations.

Several John Bellando emails were cited during testimony at the Senate Finance Committee’s inquiry into the bank’s losses during the infamous London Whale trade fiasco.

Kenneth Bellando — who grew up in Rockville Center, LI, and was a Georgetown graduate — worked as a summer analyst at JPMorgan while in school. Upon graduation in 2007, he was hired as an investment bank analyst and worked there for one year before moving on, according to his LinkedIn page.

The investment banker then went to Paragon Capital Partners, according to his LinkedIn page, until leaving at the end of 2013.


Jim Sinclair’s Commentary

Preparation for war with China?

Chuck Hagel says US will send two ballistic missile destroyers to Japan
US defence secretary says destroyers are to counter the North Korean threat, and says China must respect its neighbours, Sunday 6 April 2014 08.22 EDT

The US defence secretary, Chuck Hagel, delivered a two-pronged warning to Asia Pacific nations on Sunday, announcing that the US would send two additional ballistic missile destroyers to Japan to counter the North Korean threat, and saying China must better respect its neighbours.

In unusually forceful remarks about China, Hagel drew a direct line between Russia’s takeover of Ukraine’s Crimea region and the continuing territorial disputes between China, Japan and others over remote islands in the East China Sea.

"I think we’re seeing some clear evidence of a lack of respect and intimidation and coercion in Europe today with what the Russians have done with Ukraine," Hagel told reporters after a meeting with the Japanese defence minister, Itsunori Onodera.

"We must be very careful and we must be very clear, all nations of the world, that in the 21st century this will not stand, you cannot go around the world and redefine boundaries and violate territorial integrity and sovereignty of nations by force, coercion and intimidation, whether it’s in small islands in the Pacific or large nations in Europe."

Hagel, who will travel to China later this week, called the Asian nation a "great power" and said: "With this power comes new and wider responsibilities as to how you use that power, how you employ that military power."

He said he would talk to the Chinese about having respect for their neighbours, and said: "Coercion, intimidation is a very deadly thing that leads only to conflict. All nations, all people deserve respect no matter how large or how small."


Pro-Russian protesters seize govt buildings in Ukraine’s Donetsk, Lugansk and Kharkov
Published time: April 06, 2014 15:44
Edited time: April 06, 2014 18:40

The rally in support of the Berkut riot police troops, who were detained by the coup-imposed authorities in Kiev, has culminated in pro-Russian protesters seizing the regional administration’s buildings in the eastern Ukraine.

Over 2,000 people gathered in Lenin Square in the center of Donetsk to petition for the Berkut officers, who – they believe – are falsely accused of using fire arms against the rioters during the Maidan standoff.

The participants in the event called on the “illegal junta in Kiev” to end political repressions and persecution of dissidents, the Itar-Tass news agency reports.

They demanded their right for self-determination to be respected, pushing for a Crimea-style referendum on independence from Ukraine.

The protesters carried Russian national flags, chanted “Russia! Russia!” and displayed banners urging the new Donetsk Region governor, Sergey Taruta, who was recently appointed by Kiev, “to get out.”

An effigy of a Nazi zealot was also burnt in the square, with the action labeled “an act of annihilation of fascism” by the protesters in view of neo-Nazi radicals playing a key role in the Ukrainian coup this February.



Another Fraudulent Jobs Report
Paul Craig Roberts
The March payroll jobs report released April 4 claims 192,000 new private sector jobs.
Here is what John Williams has to say about the claim:

“The Bureau of Labor Statistics (BLS) deliberately publishes its seasonally-adjusted historical payroll-employment and household-survey (unemployment) data so that the numbers are neither consistent nor comparable with current headline reporting.  The upside revisions to the January and February monthly jobs gains, and the relatively strong March payroll showing, reflected nothing more than concealed, favorable shifts in underlying seasonal factors, hidden by the lack of consistent BLS reporting.  In like manner, consistent month-to-month changes in the unemployment rate or labor force simply are not knowable, because the BLS cloaks the consistent and comparable numbers.”

Here is what Dave Kranzler has to say: “the employment report is probably the most deceptively fraudulent report produced by the Government.”

As I have pointed out for a decade, the “New Economy” jobs that we were promised in exchange for our manufacturing jobs and tradable professional service jobs that were offshored have never shown up. The transnational corporations and their hired shills among economists lied to us. Not even a jobs report as deceptive and fraudulent as the BLS payroll jobs report can hide the fact that Congress, the White House, and the American people have sat sucking their thumbs while corporations maximized profits for the one percent at the expense of everyone else in the United States.

Let’s look at where the alleged jobs are. The BLS jobs report says that 28,400 jobs were created in March in wholesale and retail sales. March is the month that Macy’s, Sears, JC Penny, Staples, Radio Shack, Office Depot, and other retailers announced combined closings of several thousand stores, but more retail clerks were hired.

The BLS payroll jobs report claims 57,000 jobs in “professional and business services.” Are these jobs for lawyers, accountants, architects, engineers, and managers? No. The combined new jobs for these middle class professional skills totaled 10,400. Employment services accounted for 42,000 of the jobs in “professional and business services” of which temporary help accounted for 28,500.

“Education and health services” accounted for 34,000 jobs or which ambulatory and home health care services accounted for 28,000 of the jobs.


Jim Sinclair’s Commentary

Bankers are dropping like flies.

Former ABN Banker Schmittmann, Wife, Daughter Found Dead at Home
By Martijn van der Starre Apr 5, 2014 3:00 PM MT

Former ABN Amro Group NV Netherlands Chief Executive Officer Jan Peter Schmittmann, his wife and a daughter were found dead at their home yesterday after a possible “family tragedy,” Dutch police said.

“The bodies of a father and mother and their daughter were found at the property” in the town of Laren, 32 kilometers (20 miles) southeast of Amsterdam, Dutch police said in a statement on their website. Leonie Bosselaar, a police spokeswoman, said in a telephone call with Bloomberg News that the deceased were Schmittmann and two family members.

The police received a call around 10:30 a.m. local time from a family acquaintance who said something may be wrong at the property, according to the statement. Bosselaar declined to comment further.

The Dutch newspaper AD reported, without citing anyone, that the family was discovered by Schmittmann’s second daughter when she arrived home yesterday morning. She was scheduled to travel to India with her parents, where she had an internship lined up, the newspaper said.

Schmittmann, 57, joined ABN Amro in 1983 as assistant relationship manager and was named head of the lender’s Dutch unit in 2003. He stepped down from the Amsterdam-based bank in December 2008, after the company was nationalized earlier that year.


Fears of gas war as Ukraine refuses to pay increased prices set by Russian firm
Dispute comes as tensions in eastern Ukraine remain high, with pro-Russian protesters storming government buildings
Shaun Walker in Moscow
The Guardian, Sunday 6 April 2014 14.50 EDT

The prospect of a new gas war between Russia and Ukraine drew closer at the weekend as the government in Kiev said it would refuse to pay for gas at a new, inflated price set by Gazprom last week. The dispute comes as tensions in eastern Ukraine remain high, with pro-Russian protesters in two cities storming government buildings on Sunday.

In Kiev, interim prime minister Arseniy Yatsenyuk told the cabinet over the weekend that the new price for gas was unfair and Ukraine would not pay it.

"Russia has not managed to grab Ukraine through military aggression, so now they are pursuing a plan to pressure and grab Ukraine through gas and economic aggression," said Yatsenyuk. He said that Ukraine would continue buying gas at the "acceptable market price" of $268 (£162) per 1,000 cubic metres.

Last week, Russia announced two successive price hikes in gas for Ukraine, taking it up to $485.50. It is unclear what Russia will do if Ukraine refuses to pay the new price, but in the past it has shut off the supply. Last week, Gazprom’s CEO, Alexei Miller, gave televised comments explaining why Russia was raising the gas price, noting that part of the discount had come when Russia extended credit to Ukraine last December as part of a package that was given to the former president, Viktor Yanukovych, for turning his back on an association agreement with the European Union.

"The discount was given on the condition that Ukraine would pay all its gas debts and pay 100% for the current deliveries, and it was clearly indicated that if this did not happen, the discount would be annulled in the second quarter of 2014," said Miller. He said that Gazprom had "not received a single dollar" in payment for March deliveries, and thus the discount had automatically been annulled.


Jim Sinclair’s Commentary

Looks like a Cold War to me.

Nato chief tells allies: spend more on defense to deter Russia
Anders Fogh Rasmussen, Nato’s Secretary General, says allies need to modernise armed forces
By David Blair, Chief Foreign Correspondent
7:04PM BST 06 Apr 2014

Britain and its Nato allies must respond to Russia’s “illegal aggression” against Ukraine by spending more on defence, the alliance’s secretary general has said.

Writing in The Telegraph, Anders Fogh Rasmussen appeals for Nato members to modernise their armed forces as Russia tries to “carve up” Europe.

“Every ally needs to invest the necessary resources in the right capabilities,” writes Mr Rasmussen. “That means modern equipment, intensive training for our forces, and closer cooperation among Nato allies and with our partners. I know how challenging this is in today’s economic climate, but the security climate makes it vital.”

Mr Rasmussen adds: “In the long run, a lack of security would be more costly than investing now and we owe it to our forces, and to broader society.”

The burden of defending Nato’s 28 members falls increasingly on just one: the United States. Last year, America accounted for 72 per cent of Nato defence spending, up from 59 per cent in 1995.


Acting Ukraine president cancels trip to Lithuania over unrest
DEBKAfile April 6, 2014, 8:12 PM (IDT)

Ukraine’s acting president, Oleksander Turchinov, has cancelled a trip to Lithuania scheduled for Monday to deal with separatist protests in the eastern Ukraine towns of Donetsk and Luhansk. Pro-Russian protesters seized a regional government building and state security offices. They want a referendum like Crimea to determine whether to stay in Ukraine or join Russia. The statement said Turchinov was holding an emergency meeting with the heads of security services.


Nomura’s Chief Economist Richard Koo – U.S. Heading For 1900 Percent Inflation Rate
April 5th, 2014
FRI 04 APR 14 | 05:00 AM ET

Richard Koo, Chief Economist at Nomura Research Institute, explains why in the United States Nobody Really Knows how to get out of QE…. there’s enough resource in the banking system to increase the money supply 19 times, were talking potentially 1900 percent Inflation Rate.


Posted at 4:06 PM (CST) by & filed under Jim's Mailbox.


It’s time for the US to realize Iran and China should be added to Syrian peace talks unless Kerry wants another FP disaster.

CIGA Craig

Iran, Orientalism and Western illusions about Syria
Over 100,000 deaths and millions of refugees later, is the Western narrative similar to what Iranians have been saying?
Last updated: 06 Apr 2014 09:11
(Excerpt from article)

In any case, it is clear that – as the Iranians were saying from the start – the Syrian government will not collapse and that the only way forward is for this reality to be acknowledged. Continued support for foreign extremists and al-Qaeda affiliates is no longer simply a regional threat; it has become a global threat much greater than what existed in Afghanistan. Setting preconditions for one side of the Syrian conflict or the other simply means more death and destruction. The international community must come together to support an election where the Syrian people choose their own leadership and for everyone to accept the results.




The Russian hammer may come down hard on the west next week.

Russia to back Iran in nuclear talks – Moscow’s “April surprise” for Western sanctions over Ukraine
DEBKAfile Exclusive Report April 4, 2014, 10:29 AM (IDT)

As the Six Power group and Iran prepared for their third round of nuclear talks in Vienna next week (Tuesday-Wednesday, April 8-9) Tehran frankly admitted to exploiting the holes in the six-month interim deal they forged in Geneva last November. And Moscow looks like making good on its threat to back the Iranian case, in retaliation for Western penalties for its annexation of Crimea.

In a closed meeting in Tehran Wednesday, April 3, Ali Akbar Salehi, head of Iran’s Nuclear Energy Commission said: “We have 19,000 centrifuges of which 9,000 are in operation [for enriching uranium]. Our advice is not to discuss the number of centrifuges, rather to discuss the unit’s isolation power." He explained there are different types of centrifuge.

This was a candid admission that Iran had found a way to get around its commitment under the interim deal – which US Secretary of State John Kerry held up as his greatest diplomatic achievement – not to build or activate its most advanced centrifuges for speeding up enrichment.


Posted at 7:43 PM (CST) by & filed under In The News.

Moscow, Beijing taking on the dollar
26 July 2013, 14:11

Russia and China have united their efforts in the fight against the dollar as the main reserve currency, an influential American trader, Russ Winter, said. The expert says that Moscow and Beijing have been putting into practice, for a long time now, the first part of their plan aimed against the hegemony of the dollar on the world markets. Really, Russia and China have decided to give up the dollar in most cases involving international payments and to strengthen their own currencies through buying up gold.

Moscow is actively encouraging trans-border rouble remittances and restricts foreign currency remittances. For its part, Beijing is gradually introducing direct exchanges between the Chinese yuan and the euro, and also the pound sterling and the yen . Parallel with this, China has increased the import of gold considerably and is now buying much more of it than it produces. The higher the backing of the yuan by gold, the weaker the positions of the dollar as the main reserve currency become.

However, analysts say that this is only the consequence, and that the real reason is a drop in the dollar solvency, and a slowdown in the US economic activity as a result. Because of the growth of the money mass, the US currency may devalue twice in the coming three years. Beijing and Moscow have to protect their currencies against an undesirable turn of events, and therefore, they are converting their reserves into gold.

Russ Winters says that the two allies have a very simple plan : to gradually raise the convertibility of both the rouble and the yuan and to increase their role in international trade, which in time will make it possible to present them as reserve currencies. The USA, where the level of the state debt is approaching 110 per cent of the Gross Domestic Product (GDP), will simply not be able to respond to this challenge. Of course, it takes time to score a victory over the dollar, the euro and the pound. A reserve currency should meet certain demands, Head of the Trustee Management Department at Absolyut Bank Ivan Fomenko says.

“ First, the full openness of the currency market and the convertibility of this currency. Second – the reliability and openness of the financial institutions of countries which would like their currencies to heave a reserve currency status. Third – the consistency of actions of the monetary authorities. And fourth, which is the main thing here – the willingness of the companies to sign agreements with the yuan as the basic currency”.


Russia prepares to attack the petrodollar
4 April 2014, 14:34

The US dollar’s position as the base currency for global energy trading gives the US a number of unfair advantages. It seems that Moscow is ready to take those advantages away.

The existence of “petrodollars” is one of the pillars of America’s economic might because it creates a significant external demand for American currency, allowing the US to accumulate enormous debts without defaulting. If a Japanese buyer want to buy a barrel of Saudi oil, he has to pay in dollars even if no American oil company ever touches the said barrel. Dollar has held a dominant position in global trading for such a long time that even Gazprom’s natural gas contracts for Europe are priced and paid for in US dollars. Until recently, a significant part of EU-China trade had been priced in dollars.

Lately, China has led the BRICS efforts to dislodge the dollar from its position as the main global currency, but the “sanctions war” between Washington and Moscow gave an impetus to the long-awaited scheme to launch the petroruble and switch all Russian energy exports away from the US currency .

The main supporters of this plan are Sergey Glaziev, the economic aide of the Russian President and Igor Sechin, the CEO of Rosneft, the biggest Russian oil company and a close ally of Vladimir Putin. Both have been very vocal in their quest to replace the dollar with the Russian ruble. Now, several top Russian officials are pushing the plan forward.

First, it was the Minister of Economy, Alexei Ulyukaev who told Russia 24 news channel that the Russian energy companies must should ditch the dollar. “ They must be braver in signing contracts in rubles and the currencies of partner-countries, ” he said.


Moody’s downgrades Ukraine to ‘default imminent’
Published time: April 05, 2014 10:53

Moody’s Investors Service has downgraded Ukraine’s government bond rating one notch from Caa2 to Caa3, citing the current political crisis and deepening economic instability as reasons for its negative outlook.

The Caa rating is a credit risk grading pertaining to investments that are both very poor quality and entail a high credit risk. The current downgrade drops Ukraine from Moody’s "extremely speculative" rating to "default imminent with little prospect for recovery."

Moody’s said the downgrade was driven by three factors, which “exacerbate Ukraine’s more longstanding economic and fiscal fragility.”

The first factor is Ukraine’s political crisis, citing the recent regime change in Kiev and subsequent events in Crimea. The agency went on to cite Ukraine’s stressed external liquidity position, which faces continued decline in foreign currency reserves, the withdrawal of Russian financial support and a spike in gas import prices. Moody’s further noted that this assessment accounts for the near-term liquidity relief recently hammered out with the IMF. Finally, due to a “sizable fiscal deficit,” the agency expects a significant contraction of GDP and a sharp currency depreciation as the debt to GDP (Gross Domestic Product) ratio hits between 55-60 percent by year’s end.

On Thursday, Gazprom CEO Aleksey Miller announced Ukraine would begin paying $485 per thousand cubic meters of natural gas starting from April. The price rise followed a cancelation of the Black Sea hosting deal. On Wednesday President Vladimir Putin signed a federal law ending Russia’s commitment to the Kharkov Agreement, as the Black Sea port of Sevastopol is now under jurisdiction of the Russian Federation. This follows another steep hike on April 1, when the price Ukraine paid for gas went up 44 percent to $385, after Kiev failed to meet its debt repayments.


Jim Sinclair’s Commentary

The USA is really going to war with China over China sea’s gas and oil?

Chuck Hagel reaffirms US ‘strong commitment’ to protect Japan
US defence secretary’s fourth trip to region comes as China, Japan and other nations are locked in bitter territorial disputes
Associated Press at Yokota Air Force Base, Japan, Saturday 5 April 2014 09.09 EDT

Against the backdrop of Russia’s takeover of Ukraine’s Crimean region, Defense Secretary Chuck Hagel said on Saturday that a key message he will deliver to leaders in Tokyo this weekend is that the US is strongly committed to protecting Japan’s security.

Hagel said it was understandable for nations to be concerned as they watch the events unfold in Ukraine, where Russian troops are still massed along the border. The issue reverberates in Asia where China, Japan and other nations are locked in bitter territorial disputes, including over disputed islands in the East China Sea.

"It’s a pretty predictable, I think, reaction, not just of nations of this area and this region but all over the world," Hagel told reporters traveling with him to Tokyo. "I think anytime you have a nation, Russia in this case, try to impose its will to refine and define international boundaries and violate the territorial integrity and sovereignty of a nation by force, all of the world takes note of that."

Assistant secretary of state Daniel Russel also said this week that Russia’s annexation of Crimea heightened concern, particularly among some Southeast Asian nations, about the possibility of China "threatening force or other forms of coercion to advance their territorial interests”.

While the US has repeatedly said it takes no side on the question of the disputed islands’ sovereignty, it recognises Japan’s administration of them and has responsibilities to protect Japanese territory under a mutual defence treaty.


Chris Martenson: The Screaming Fundamentals For Owning Gold

"Da boyz" were a no-show at the release of the jobs number yesterday"

Yesterday In Gold & Silver

The gold price didn’t do a thing in Far East trading on their Friday—and as I stated in The Wrap section of yesterday’s column, volume up until the London open was lower than I could ever remember seeing it.

But shortly after trading began in London, some positive price action got underway, with higher ticks at both the 12 noon BST silver fix—and again at the Comex open in New York.  The usual smash down at the release of the jobs numbers failed to materialize.  But the serious price rally that began when London closed at 11 a.m. EDT in New York, ran into the usual not-for-profit sellers within 15 minutes—and that was it for the remainder of the day.

The CME Group reported the low and high price ticks as $1,284.40 and $1,307.50 in the June contract.

Gold finished the trading day in New York at $1,302.30 spot, up $15.50 on the day.  Not surprisingly volume, net of April and May, was pretty decent at 156,000 contracts.


Here’s the New York Spot Gold [Bid] chart so you can see the Comex trading session in more detail—particularly the price capping shortly after London closed.


Silver did nothing in Far East trading as well, with the total volume under 2,000 contracts at the London open.  But once silver began to rally, it was obvious that there numerous times where a seller of last resort put in an appearance before prices got too far out of hand to the upside, especially in New York trading.  And, true to form, not only did JPMorgan et al cap the rally, but the also sold silver back down below $20 the ounce while they were at it.


Kerry gives up on Israeli-Palestinian peace talks
Published time: April 04, 2014 19:18

Secretary of State John Kerry said Friday that the Obama administration will reassess its role in attempting to broker a peace deal between Israel and Palestine after the latest round of discussions proved to be all but fruitful.

Speaking to reporters from Rabat, Morocco amid his latest tour overseas, Kerry said that the most recent attempts from the United States to find common ground between leadership in the Middle East have failed.

Reporting from Morocco, the Associated Press said Kerry appeared “visibly downbeat” as he disclosed to journalists the results of the State Department’s latest attempt to find an answer to the long-standing issues between the Israelis and Palestinians.

Both sides said last year that they’d reach an agreement by the end of April 2014, but Sec. Kerry said this week that a negotiation between parties is nowhere as near as the White House had hoped. Israel had initially agreed to release a group of Palestinian prisoners, but earlier this week rescinded that promise, prompting discussions to deteriorate even further. Palestinian President Mahmoud Abbas responded on Tuesday by saying his nation would seek greater recognition from the United Nations, much to the chagrin of Israeli Prime Minister Benjamin Netanyahu.

"They say they want to continue,” the AP quoted Kerry as saying of both leaders. "But we are not going to sit there indefinitely. This is not an open-ended effort. It’s reality check time."


White House sources tell Kerry to wrap up Mid East peace bid
DEBKAfile April 4, 2014, 12:38 PM (IST)

Some circles around US Secretary of State, including inside the White House, are quoted by the Washington Post as believing the time is near for him to say “Enough!” of his Mid East peace effort. Some high administration officials speaking on condition of anonymity say Kerry risks being seen as trying too hard at the expense of other pressing international issues, even perhaps his reputation. “A time will come where he has to go out and own failure.” For now, they say, Kerry needs to “lower the volume and see how things unfold.”

Kerry has made 11 trips to Israel in the past year and shuttled endlessly between Prime Minister Binyamin Netanyahu and Palestinian leader Mahmoud Abbas. This week, the process blew up when Abbas filed applications for a “Palestinian state” to join 15 UN agencies, in violation of his prior pledge to the US Secretary and Israel. Israel punished him Thursday with a string of sanctions against the Palestinian Authority after canceling the fourth round of jailed Palestinian releases.


Posted at 7:26 PM (CST) by & filed under Jim's Mailbox.


Here are some very important bottom lines.

CIGA Craig

The US-Russia Ukrainian deal
By Pepe Escobar
(Excerpts from article)

Compound the vicious catfight among dodgy factions in Kiev, from fascists to Saint Yulia "Kill all the Russians" Timoschenko; Gazprom raising the price of natural gas by 80%; and the International Monetary Fund about to unleash some nasty structural adjustment that will make Greece look like Cinderella playing in a rose garden, and all that Moscow needs to do is sit back, relax and watch the (internal) carnage.

So Ukraine is essentially a detail – and "Europe" is no more than a helpless bystander. Who are you gonna call in "Europe"? That Magritte-style nonentity European Council President Herman Van Rompuy? Anyone who’s been to Brussels knows that "Europe" remains a glorified collection of principalities bickering in a smatter of languages. Machiavelli would easily recognize it as such.

To top if off, the Obama administration has no clue what it wants in Ukraine. A "constitutional democracy"? Moscow might even agree with that, while knowing, based on rows and rows of historical/cultural reasons, it’s bound to be a failure. The red line though has been spelled out over and over again: no NATO bases in Ukraine.

Rational players in Washington – a certified minority – certainly have noticed that if you don’t play ball with Moscow, Russia will play very hard ball within the framework of the P5+1 (the UN Security Council permanent members plus Germany) negotiations on the Iranian nuclear dossier.


Posted at 11:30 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

Mr. Williams shares the following with us all.

- March Payroll Jobs Increase of 192,000 Was Bloated Heavily by Concealed and Constantly-Shifting Seasonal Adjustments
- Payroll and Unemployment Numbers Remain of Horrendous Quality, Generally Not Comparable With Earlier Reporting
- March Unemployment: 6.7% (U.3), 12.7% (U.6), 23.2% (ShadowStats)
- Year-to-Year M3 Growth Rose to 3.7% in March

"No. 616: March Employment and Unemployment"

Lawmakers call on oil and gas producers to ditch ‘dirty, bloody dollar’
Published time: April 03, 2014 13:00

A group of Lower House MPs are urging Russian oil and gas producers and traders to stop using the US dollar. They say this means sharing profits with the USA, and making Russia vulnerable to western sanctions.

“The dollar is evil. It is a dirty green paper stained with blood of hundreds of thousands of civilian citizens of Japan, Serbia, Afghanistan, Iraq, Syria, Libya, Korea and Vietnam,” one of the authors of the motion, Mikhail Degtyaryov of the conservative nationalist party LDPR said in an interview with Izvestia daily.

Degtyaryov also said that Russia already had a bilateral agreement with China allowing payment in national currencies and this proved that such step was possible.

“Our national industrial giants will not suffer any losses if they choose to make contracts in rubles or other alternative currencies. Russia will benefit from that. We should act paradoxically when we deal with the West. We will sell rubles to consumers of our oil and gas, and later we will exchange rubles for gold. If they don’t like this – let them not do this and freeze to death. Before they adjust, and this will take them three of four years, we will collect tremendous quantities of gold. Russian companies will at last become nationally oriented and stop crediting the economy of the US that is openly hostile to Russia,” the MP said.

Degtyaryov is known for drafting an official bill banning the US dollar in Russia. He told reporters that this document has been recalled from parliament and amended with a ban on the euro and promised to re-submit the new draft to the Lower House in the near future.

On Wednesday the head of leading state-owned bank VTB, Andrey Kostin, also urged Russia to start transitioning to ruble payments with all its trading partners, including China and Western Europe. Kostinalso said the switch should begin as soon as possible, and that exporting companies should lead the way in adopting the change. According to the banker the plan could help to lower the country’s dependency on “the whims of US and EU authorities”.



Boosting forex reserves: Pakistan refuses to sell $2.7b worth of gold says IMF
By Shahbaz Rana
Published: March 29, 2014

ISLAMABAD: Pakistan has refused to sell gold worth $2.7 billion, citing national security reasons, as the International Monetary Fund (IMF) pushes Islamabad to convert the precious metal into cash to build foreign currency reserves, revealed the global lender’s report on Friday.

The report, prepared by IMF’s staff led by its Washington-based Mission Chief to Islamabad Jeffrey Franks, also spills the beans on the ‘$1.5 billion gift’ to Pakistan by ‘Saudi Arabia’ – the name Prime Minister Nawaz Sharif’s government has so far refused to officially share with parliament.

According to the report, the State Bank of Pakistan (SBP) holds over 2 million troy ounces of monetary gold, having $2.7 billion value at market rate. It is not counted in gross international reserves as it is not deemed to be liquid by the SBP, says the IMF.

The IMF and Pakistan authorities discussed what steps would be needed to make gold more liquid, the report adds. “However, the (Pakistani) authorities stressed that they have no plans to sell gold and preferred existing arrangements for gold holdings for national security reasons.”

The IMF is pushing Pakistan to sell gold holdings at a time when other countries are buying the commodity as a strategic reserve. The IMF had even sold its surplus gold to India a couple of years ago.


U.S. warns China not to attempt Crimea-style action in Asia
Fri Apr 4, 2014 11:26am BST

(Reuters) – China should not doubt the U.S. commitment to defend its Asian allies and the prospect of economic retaliation should also discourage Beijing from using force to pursue territorial claims in Asia in the way Russia has in Crimea, a senior U.S. official said on Thursday.

Daniel Russel, President Barack Obama’s diplomatic point man for East Asia, said it was difficult to determine what China’s intentions might be, but Russia’s annexation of Crimea had heightened concerns among U.S. allies in the region about the possibility of China using force to pursue its claims.

"The net effect is to put more pressure on China to demonstrate that it remains committed to the peaceful resolution of the problems," Russel, the U.S. assistant secretary of state for East Asia, told the Senate Foreign Relations Committee.

Russel said the retaliatory sanctions imposed on Russia by the United States, the European Union and others should have a "chilling effect on anyone in China who might contemplate the Crimea annexation as a model."

This was especially so given the extent of China’s economic interdependence with the United States and its Asia neighbours, Russel said.


Russia prepares to attack the petrodollar

The US dollar’s position as the base currency for global energy trading gives the US a number of unfair advantages. It seems that Moscow is ready to take those advantages away.

The existence of “petrodollars” is one of the pillars of America’s economic might because it creates a significant external demand for American currency, allowing the US to accumulate enormous debts without defaulting. If a Japanese buyer want to buy a barrel of Saudi oil, he has to pay in dollars even if no American oil company ever touches the said barrel. Dollar has held a dominant position in global trading for such a long time that even Gazprom’s natural gas contracts for Europe are priced and paid for in US dollars. Until recently, a significant part of EU-China trade had been priced in dollars.

Lately, China has led the BRICS efforts to dislodge the dollar from its position as the main global currency, but the “sanctions war” between Washington and Moscow gave an impetus to the long-awaited scheme to launch the petroruble and switch all Russian energy exports away from the US currency .

The main supporters of this plan are Sergey Glaziev, the economic aide of the Russian President and Igor Sechin, the CEO of Rosneft, the biggest Russian oil company and a close ally of Vladimir Putin. Both have been very vocal in their quest to replace the dollar with the Russian ruble. Now, several top Russian officials are pushing the plan forward.

First, it was the Minister of Economy, Alexei Ulyukaev who told Russia 24 news channel that the Russian energy companies must should ditch the dollar. “ They must be braver in signing contracts in rubles and the currencies of partner-countries, ” he said.

Then, on March 2, Andrei Kostin, the CEO of state-owned VTB bank, told the press that Gazprom, Rosneft and Rosoboronexport, state company specialized in weapon exports, can start trading in rubles. “ I’ve spoken to Gazprom, to Rosneft and Rosoboronexport management and they don’t mind switching their exports to rubles. They only need a mechanism to do that ”, Kostin told the attendees of the annual Russian Bank Association meeting.


Jim Sinclair’s Commentary

Somebody got Wall street sized bonus.

$6 Billion Goes Missing at State Department
Brianna Ehley
The Fiscal Times
April 4, 2014

The State Department has no idea what happened to $6 billion used to pay its contractors.

In a special “management alert” made public Thursday, the State Department’s Inspector General Steve Linick warned “significant financial risk and a lack of internal control at the department has led to billions of unaccounted dollars over the last six years.

The alert was just the latest example of the federal government’s continued struggle with oversight over its outside contractors.

The lack of oversight “exposes the department to significant financial risk,” the auditor said. “It creates conditions conducive to fraud, as corrupt individuals may attempt to conceal evidence of illicit behavior by omitting key documents from the contract file. It impairs the ability of the Department to take effective and timely action to protect its interests, and, in tum, those of taxpayers.”

In the memo, the IG detailed “repeated examples of poor contract file administration.” For instance, a recent investigation of the closeout process for contracts supporting the mission in Iraq, showed that auditors couldn’t find 33 of the 115 contract files totaling about $2.1 billion. Of the remaining 82 files, auditors said 48 contained insufficient documents required by federal law.

In another instance, the Bureau of International Narcotics and Law Enforcement issued a $1 billion contract in Afghanistan that was deemed “incomplete.”