Jim Sinclair’s Commentary
All this is coming home in 2017. Yellen may very well go out!
Nearly 95% Of All New Jobs During Obama Era Were Part-Time, Or Contract
December 21, 2016
Investing.com — A new study by economists from Harvard and Princeton indicates that 94% of the 10 million new jobs created during the Obama era were temporary positions.
The study shows that the jobs were temporary, contract positions, or part-time “gig” jobs in a variety of fields.
Female workers suffered most heavily in this economy, as work in traditionally feminine fields, like education and medicine, declined during the era.
The research by economists Lawrence Katz of Harvard University and Alan Krueger at Princeton University shows that the proportion of workers throughout the U.S., during the Obama era, who were working in these kinds of temporary jobs, increased from 10.7% of the population to 15.8%.
It seems only the US is growing? Do you really believe that? Check the retail number for December.
Aussie Dollar Tanks After China Admits Growth Will Miss 6.5% Target
December 23, 2016
With fears mounting over China’s debt load sustainability, and amid yet another liquidity crisis, President Xi Jinping appeared to admit that China’s economic growth will slow below the government’s 6.5% target. Despite the promise of creating a “modestly prosperous society,” Xi warned that China doesn’t need to meet the objective if doing so creates too much risk – a little late for that after trillions of freshly created credit was spewed into zombified firms this year – but at least reality is starting to set in.
Last year’s 6.9 percent expansion was the slowest in a quarter century. For this year, the government set a 6.5 percent to 7 percent target range, slower than last year’s goal of about 7 percent. IMF Managing Director Christine Lagarde said earlier in February that the fund strongly recommended that China set a growth target range of 6 percent to 6.5 percent.
We at JSMineset wish you and yours a Merry Christmas! We will have a very light calendar until the New Year. Bill will have a year end piece out sometime next week. Our weekly interviews will begin again on Jan. 7th unless market conditions warrant something sooner. Life is not a dress rehearsal and do overs don’t exist, take this precious time with your family during the holiday and cherish it. May God bless us all!
Bitcoin is a virtual game that is being made look better than gold or silver, to sell the concept of a world wide virtual currency.
It should change its name to “Nintendo Virtual Foolishness,” as it’s purpose is to win the hearts and minds of a public.
After that to construct a “Dollar Index Bit Coin” backed by tickets to Mars from Space Inc. with a picture of Elon Musk.
There is no computer game that can not be hacked, and there never will be.
Physical gold in China $40. In my opinion only $10 below a profitable arbitrate or black market arbitrage.
Dear Comrades in Golden Arms,
What is left to go before the Great Reset?
The Great Reset is the milestone economic event that is the final step in the restructuring of the monetary system that functions as real money is intended to.
This system in word and fact is the mechanism the sum of its parts truly functions as:
1.A Store House of value.
2.A Measure of value.
3.A Standard of value
4.A Medium of Exchange.
Money as generally interpreted in your modern business school and by a general public is anything of value that serves as a (1) generally accepted medium of financial exchange, (2) legal tender for repayment of debt, (3) standard of value, (4) unit of accounting measure, and (5) means to save or store purchasing power.
Before we get into the subject let’s agree to certain facts.
Common types of currency issued by official order are valued based on the issuing authority’s guarantee to pay the stated (face) amount on demand, and not on any intrinsic worth or extrinsic backing. All national currencies in circulation, issued and managed by the respective central banks, are fiat currencies.
There simple is not enough fiat currency on circulation to pay off all national and business debts even if we exclude government guarantees.
Most what is called money is an accounting entry now in cyberspace.
Computer currencies are a bridge over mental gap between the common belief in money and the requirements of what money truly does.
All of this is based on confidence in a system whose foundation of convincing on a continuing basis a public that the fiat currency can pretend and extend an illusion of real money whose definition is other than that universally held now and whose foundation is set in the cement of a pure illusion without backing in kind, uninsured and failing badly in many respects.
Please keep in mind that President Elect Trump is a proven master at the use of bankruptcy in business to set a foundation upon which a going concern can replace the previous failed entity or system of operation of the entity.
Not only is the monetary system insolvent if called upon to perform in even a modesty percentage. The entire system would fail miserably. However, there is no lack of resources and productivity if incentivized to make the global system again functional and durable by making real, not pretend money the basis.
What is Mr. Trump’s real business background?
He is a builder of brick and mortar.
He is a negotiator.
He has zero lack of self worth or abilities.
He is a master of using the economic tool of bankruptcy to restructure and retreat and from the conditions of financial bankruptcy.
Today’s world is without any doubt a rolling bankruptcy whose foundation is pretend and extend. Inherently pretend and extend has shown no permanency anytime, anywhere. The “Great Flush” which must proceed the “Great Reset” has been, most disturbingly, war won or lost.
Therefore, the United States, one of the most powerful countries in the global system, is insolvent, that is true just on the factors of OTC derivatives and unfunded obligations. You need not be a genius to understand this.
As a result of all this nothing has been economically supplied to cure the basic problem. Pretend and extend has been the basis of the illusion that the system functions.
Why is gold hated, the dollar and the equity market always protected by the creation of more illusion that all is steady and the government and quasi government the underwriter of this.
Economic Potemkin City of money with stability. Why did gold move up and the general markets decline near $900 when the unexpected victory of President Elect Donald Trump occur? The answer is that a correct definition of the world’s new leader in known by some. It was the Hillary Clinton Plunge Protection Machine that rescued the market and pressured gold lower which was prepared in anticipation of a Clinton victory for the unexpected Trump victory.
There is an axiom that “before a massive public will accept a new system as a way out, they must suffer severely.” This is proven by history in every national bankruptcy of a nations currency. An example of note is the Weimar Republic that gave rise to the socialist leader, Hitler. In this example the war had to be lost for a Reset to happen. The reason I anticipate the “Great Reset,” is that the experiment of Globalism has failed miserably with the world now imitating the recklessness of massive Western Debt creation.
This is not the end of the world but rather the means of change to a new world that in the end might be quite abundant and peaceful. Just like a great fall caused no injury if you have prepared a large foam mattress for your family.
The injury comes via the means by which the fall stops. It is this that we work so hard to prepare you for in order for the transition by painless to you. It is not a game of gambling but of structuring in many ways to make your landing soft, not hard.
The means to the Great reset is in place and moving forward. It started with the nine exchanges opened for trading in PHYSICAL gold and silver. Premiums have been running in the $40-$45 basis on gold and $2 on silver.
The profit by arbitrage, which is the purchase and sale of the same item.
So here is your scenario:
1. Physical gold continues to rise under Mid Eastern and Russian demand plus the demand of sleeping giants in the US typically called One Percenters.
2. The physical gold arbitrage is not cheap requiring precise logistics, insurance, and relationships.
Trust which are hard to come by. Cooperation of a major gold refiner with in place logistics and payment systems plus trust is an absolute requirement.
All of this can be purchased except trust which is a product of long and fruitful relationships.
3. As the premium for gold, that is the price on the physical markets in China and Asia rises to over $50 and remains firm regardless of the ups and downs in the paper market the arbitrage will be profitable enough.
5. This Arbitrage has one place to come from and that is out of the paper gold warehouses to the refineries delivered directly to the account of the buyer or directly to the account of the physical exchange at the refinery.
6. Normal assays require 3 days and delivery according to logistics is prompt as one/two days or is made at the refineries.
7. Therefore the mechanics of the Great Reset has little to do with anything whatsoever except the size of the premium of physical over paper gold and silver plus the above criteria.
8. As this process continues the warehouse supply of all paper exchanges will continue to dwindle until the paper contract can longer function.
9. No longer function means even pretending to be able to make delivery when called upon right now for every one ounce of gold five hundred at twenty for are promised as deliverable. That is almost as crazy as the fraudulent OTC derivatives with no mark to market that we pretend has value.
10. When delivery from the paper exchange fails which it will, what is the value of a novated contract that cannot perform at the Comex? That is right. It is zero.
11. Since in the Hunt situation the first thing the board of directors at the Comex did was unilaterally changed (one side refuses to perform) the contract to “Sellers Only.” You can be sure the same people will do the same thing.
12. What do you think a contract that does not perform is worth? Again the correct answer is nothing.
13. As this occurs, which it has to, the paper gold contract loses all value. It is also useless if you are short because it will not perform for short the paper gold cover either. You cannot buy back a novated contract and meet the requirements for a short cover.
The reason is simple as a non novated contract for paper gold is entirely different than a regularly function paper gold contract since one is an apple and the other is a banana. You may have an 1100 plus fake profit you cannot collect one cent on.
As such all the normal causes of high gold and silver prices will play but a MINOR part in the unfolding drama. No group of wizards at any institution will figure this out, make it happen or stop it from happening as long as the price differential between paper gold and the price of the physical remain at or above the price of physical market for both.
In conclusion regardless of the drama unfolding or the opinion of so many new gurus no one word they say is correct in determination of the final price of gold.
All that matters is what is written above in points in 14 points.
Comex paper gold will be offered at a nominal price, say $5 offered and no bid. Physical gold will be between $3000 and $5000 big and offered by China, Russia and others.
I am regularly chastised for my dedicated bullishness in both my opinion on the gold price and on gold shares even though I am correct.
Now if per chance you could mine gold at let’s say $600 or so please inform me why you would sell it other than to meet immediate needs.
Bulyanhulu in Tanzania for instance has always been assumed to hold 20,000,000 ounces or more from inception. How much of that gold has been sold at present and lower absurd prices if you have a clear understanding of the shift in the mechanism for price discover in gold from paper exchanges to physical exchanges being the sole reason the Russians and Chinese are correct in buying all the physical offered.
Therefore, gold is going to $5000 or better wherein the profit will be made by Physical gold investors and enlightened gold company management that strives to produce and store all their gold not needed for sale to keep the lights on. The location for storage is at an international non – bank Swiss refinery, not at the location of the mine or at the location of the companies.
Try to explain that to anyone if you want to see glass forming over their eyes when it is so simple it screams at you.
The currency of greatest attraction will be that of the nation holding the most gold. The currency of the nation holding the least gold will be the weakest. Thus the market, not central banks accomplish the RESET.
Two ladies go to the inauguration balls. One quite beautiful lady wears a 10 carat diamond and the other lady wearing the hope diamond. Who gets looked at the most.
The value of gold is the jewelry.
Worn by the nation.
This is how currencies will ultimately be sought after.
Currencies will be valued by the value of gold each national treasury has.
It would be quite nice if the ISA has the gold they claim but this can only be known when a real third party audit occurs. Regardless either what I have told you what will happen. This is not in the far distant future.
Remember this is triggered at any price of gold should the difference in physical versus paper gold trigger the arbitrage transaction.
Bill Holter’s Commentary
This is a very bad sign for a Ponzi scheme that relies on “new credit” to continue. We now also know China is being forced to liquidate US Treasuries to shore up their own finances, not good no matter how it is spun…
Chinese Interbank Lending Freezes, Forcing Massive Intervention By China’s Central Bank
December 18, 2016
China is finding itself in an increasingly more untenable situation, trapped on one hand by its sliding currency (and declining reserves), which as noted earlier it has manipulated higher by forcing overnight unsecured rates to spike, in the process punishing “speculators” and other shorts…
… and on the other, by a banking sector that finds itself desperately in need of liquidity, unable to endure the PBOC’s monetary interventions, and on the verge of a liquidity crisis comparable to what Chinese banks suffered in the summer of 2013 when overnight rates briefly shot up above 20% as China pushed aggressively with a failed deleveraging campaign.
All this came to a head late last week when as Caixin reported late on Thursday, interbank lending froze on Thursday after many commercial banks suspended interbank operations amid tight liquidity conditions. Caixin adds that major institutions such as securities firms and fund managers, suddenly found themselves in a liquidity vacuum after banks, including the big four state-owned banks, became reluctant to make loans.