Posted at 3:30 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

This is very serious where the petro dollar is concerned.

The use of the dollar in energy settlement is the major source of dollar strength.

Iran And Russia Are Working To Seal A $20 Billion Oil-For-Goods Deal: Sources
JONATHAN SAUL AND PARISA HAFEZI, REUTERS

LONDON/ANKARA (Reuters) – Iran and Russia have made progress towards an oil-for-goods deal sources said would be worth up to $20 billion, which would enable Tehran to boost vital energy exports in defiance of Western sanctions, people familiar with the negotiations told Reuters.

In January Reuters reported Moscow and Tehran were discussing a barter deal that would see Moscow buy up to 500,000 barrels a day of Iranian oil in exchange for Russian equipment and goods.

The White House has said such a deal would raise "serious concerns" and would be inconsistent with the nuclear talks between world powers and Iran.

A Russian source said Moscow had "prepared all documents from its side", adding that completion of a deal was awaiting agreement on what oil price to lock in.

The source said the two sides were looking at a barter arrangement that would see Iranian oil being exchanged for industrial goods including metals and food, but said there was no military equipment involved. The source added that the deal was expected to reach $15 to $20 billion in total and would be done in stages with an initial $6 billion to $8 billion tranche.

The Iranian and Russian governments declined to comment.

Two separate Iranian officials also said the deal was valued at $20 billion. One of the Iranian officials said it would involve exports of around 500,000 barrels a day for two to three years.

More…

 

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- Extremely Difficult Circumstances in the Year Ahead: Confluence of Economic and Systemic Crises Should Intensify
- With Global Confidence in Dollar Rattled by Uncontrollable Fiscal and Monetary Excesses, U.S. Government and the Federal Reserve Have Limited Options to Address Panics
- Heavy Selling of U.S. Dollar Remains Likely Proximal Trigger for Inflation Pick-Up 
- Developing Hyperinflation Would Push Ongoing Recession into Deep Depression
- Physical Gold Remains Primary Hedge for Preserving Wealth and Asset

"No. 614: SPECIAL COMMENTARY (Revised No. 587 of January 7, 2014)"
Web-page: http://www.shadowstats.com

Analysis: North Korea acts up again; how should West react?
By Jason Miks, CNN
April 2, 2014 — Updated 1127 GMT (1927 HKT)

(CNN) — Another week, another North Korean provocation.

It might seem an understandable reaction to news Monday that North and South Korea had exchanged hundreds of shells across their western sea border. The incident occurred a day after Pyongyang had warned it was preparing to test another nuclear device, and just a week after it tested two medium-range ballistic missiles.

But should the West greet such saber-rattling with a shrug of the shoulders? After all, Western capitals have been engaging in this "dance" for two decades, since the late Kim Jong Il took over as the country’s supreme leader. Is this latest round of provocations under his son and successor, Kim Jong Un, simply more of what we’ve seen before?

Not necessarily, argue some of those closely familiar with North Korea. They warn that under Kim Jong Un’s rule, Pyongyang has shown an even greater willingness to raise the stakes, whether it be the multiple missile launches over the past several weeks, the way it stoked a crisis last spring when it announced it had ended the 1953 Korean Armistice Agreement and moved intermediate missiles to its east coast, or its warning that foreign companies and tourists in South Korea should evacuate.

More recently, in the U.S. intelligence community’s annual worldwide threat assessment, Director of National Intelligence James Clapper warned that North Korea had "expand(ed) the size of its Yongbyon enrichment facility and restart(ed) the reactor that was previously used for plutonium production" but was shut down in 2007.

"The regime still acts in a very belligerent manner, but it seems less predictable, and more random," said Christian Whiton, deputy envoy to North Korea during the George W. Bush administration.

More…

Billionaire Warns: Yellen Collapse ‘Will Be Unlike Any Other’
Tuesday, 01 Apr 2014 12:49 PM

Another horrific stock market crash is coming, and the next bust will be “unlike any other” we have seen.

That’s the message from Jeremy Grantham, co-founder and chief investment strategist of GMO, a Boston-based firm with $117 billion in assets under management.

Grantham pulls no punches when he discusses who he holds responsible for the coming financial carnage. In a recent interview with The New York Times, he calls Federal Reserve Chair Janet Yellen “ignorant” and said the Federal Reserve all but killed the economic recovery.

He also says that he isn’t putting his clients’ money into the market right now.

“We invest our clients’ money based on our seven-year prediction. And over the next seven years, we think the market will have negative returns. The next bust will be unlike any other, because the Fed and other central banks around the world have taken on all this leverage that was out there and put it on their balance sheets. We have never had this before.”

More…

Nato moves to bolster eastern European defences against Russia
Putin’s seizure of Crimea prompts alliance to reinforce Poland and Baltic states, and suspend co-operation with Kremlin
Ian Traynor in Brussels
theguardian.com, Tuesday 1 April 2014 18.33 BST

Two decades on from the end of the cold war, Nato governments returned last night to their core mission of protecting Europe from Russia.

As a result of the Kremlin’s seizure of Ukraine’s Black Sea peninsula of Crimea, Nato foreign ministers discussed plans to bolster defences in eastern Europe and suspend "all practical civilian and military co-operation" between Nato and Russia", Nato officials said.

The foreign ministers also acted to boost military co-operation with former Soviet states on Russia’s southern flank.

However, the first Nato ministerial meeting since Moscow annexed Crimea shied away from stationing Nato forces permanently in eastern Europe and from contemplating Nato membership for Ukraine.

While Moscow declared that the seizure of the Ukrainian peninsula had nothing to do with Russia but rather had occurred as a result of "internal processes" in Ukraine, Nato leaders dismissed assurances from the Kremlin of a pull-back of forces, estimated at 40,000, massing on Ukraine’s eastern borders.

More…

New ratings agency Scope flags "bail-in" risk for bank investors
LONDON, April 2 Wed Apr 2, 2014 7:55am EDT

(Reuters) – The risk that creditors rather than taxpayers will bear the brunt of rescuing a bank in trouble form part of the first credit ratings given to 18 of Europe’s biggest banks on Wednesday by new ratings agency Scope.

The company, which set up in Berlin in 2002 and started credit ratings two years ago, said it aims to offer a new approach for corporate bond investors that typically rely on the three major ratings firms – Moody’s Investors Service, Standard & Poor’s and Fitch Ratings.

Scope said its ratings reflected the likelihood that if a bank runs into trouble, bondholders will be "bailed in" to strengthen the bank rather than a taxpayer-funded rescue as happened during the financial crisis.

"Banks are still too big to fail, the only difference is that somebody else will pay to avoid a failure, and that somebody else is the creditors," Sam Theodore, Scope’s managing director for financial institutions, said.

"Through bail-in you could call this the privatisation of bank rescues, which to us is one of the most significant regulatory steps taken in recent years in respect to banks," Theodore said.

More…

Abbas dumps another US-led peace effort, Kerry gives up on shuttle, Pollard release recedes
DEBKAfile Special Report April 1, 2014, 11:05 PM (IST)

Palestinian leader Mahmoud Abbas did not announce his walkout from the negotiations with Israel or directly turn down the package of far-reaching Israeli concessions which US Secretary of State John Kerry assembled with Binyamin Netanyahu early Wednesday, April 1. He simply turned his back on the commitment he made ahead of the talks to refrain from unilateral applications to UN bodies while they were in progress. As soon as the US Secretary flew off to Brussels, he sent out applications for  “the independent Palestinian state” to join 12 UN agencies as members.

This was after the Palestinian leader upped his price for meeting Kerry’s request to extend peace diplomacy from April up until the end of the year. He demanded that Israel raise the number of 26 Palestinians due to be released from jail this weekend, to 1,000. They must also include Israeli Arabs.

He was not satisfied with Israel’s offer to free another 400 terrorists and accept a partial settlement freeze; Israel must release the same number as it traded for Gilead Shalit, the Israeli hostage held by Hamas, he said.

Abbas further insisted on top Palestinian terrorist operatives serving sentences for multiple murder be on the list of released pirsoners, including the notorious Marwan Barghouti (who is serving six life sentences for six murders), Ahmad Saadat, (who plotted the assassination of the Israeli cabinet minister Rehavam Zeevi) and the return to their homes of terrorists exiled as too dangerous to leave at large in the Palestinian territories.

Prime Minister Binyamin Netanyahu tried to calm the anger in his cabinet and the Israeli public over the bottomless Palestinian capacity for extortion. His associates said that he shared John Kerry’s belief that buying another nine months for the negotiations would give the US-led peace track a good shot at running full course.

More…

Jim Sinclair’s Commentary

A KGB officer will not be scared by shows of strength he believes the leaders of the West will never use. The real danger is a mistake between potential combatants.

Ukraine agrees to host NATO war games
April 1, 2014 5:30 AM

Kiev (AFP) – Ukraine’s parliament on Tuesday approved a series of joint military exercises with NATO countries that would put US troops in direct proximity to Russian forces in the annexed Crimea peninsula.

"This is a good opportunity to develop our armed forces," acting defence minister Mykhailo Koval told Verkhovna Rada lawmakers ahead of the 235-0 vote.

The decision came as NATO foreign ministers gathered in Brussels for a two-day meeting dominated by concern over the recent buildup of Russian forces near Crimea that US officials estimate had at one point reached about 40,000 troops.

NATO has sought to reinforce its eastern frontier after Russia’s takeover of Ukraine’s Black Sea peninsula and amid concerns about Kremlin’s emboldened foreign policy.

Russia on Monday reported pulling back a battalion of about 500 to 700 soldiers from the border region in a move that German Foreign Minister Frank-Walter Steinmeier called "a small sign that the situation is becoming less tense".

Ukraine is not a NATO member and its new Western-backed leaders have vowed not to push for closer relations with the Brussels-based military alliance — a bloc that has been viewed with deep mistrust by Moscow since the Cold War.

More…

Exclusive – Michael Lewis Extended Interview

Author Michael Lewis discusses his book "Flash Boys" in which an unlikely group of ragtag heroes map the hidden complexities and corruption of the market and set out to create IEX, a stock exchange with investors’ rights in mind. (19:58)

Click here to watch the video…

Jim Sinclair’s Commentary

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

Bundesbank, PBOC in Pact to Turn Frankfurt Into Renminbi Hub (1)
By Angela Cullen and Weixin Zha March 28, 2014

Germany’s Bundesbank and the People’s Bank of China agreed to cooperate in the clearing and settling of payments in renminbi, paving the way for Frankfurt to corner a share of the offshore market.

The central banks signed a memorandum of understanding in Berlin today, when Chinese President Xi Jinping met German Chancellor Angela Merkel, the Frankfurt-based Bundesbank said in an e-mailed statement.

Germany’s financial capital prevailed over Paris and Luxembourg in a euro-area race to win trade in renminbi, which overtook the euro to become the second-most used currency in global trade finance in October, according to the Society for Worldwide Interbank Financial Telecommunication. The U.K. Treasury said on March 26 that the Bank of England would sign an initial agreement with the PBOC on March 31 to clear and settle yuan transactions in London.

“Frankfurt is one of Europe’s foremost financial centers and home to two central banks, making it a particularly suitable location,” said Joachim Nagel, a member of the Bundesbank’s executive board. “Renminbi clearing will strengthen the close economic and financial ties between Germany and the People’s Republic of China.”

China is loosening exchange-rate controls in an overhaul of its $9 trillion economy. The accord follows the establishment of a 350 billion-yuan ($56 billion) and 45 billion-euro ($62 billion) bilateral swap line between the PBOC and the ECB in October, bolstering access to trade finance in the euro area.

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Beware of ‘bank bail-in’ hazard
Letter to the editor
POSTED:   04/02/2014 01:58:57 AM PDT

Are your deposits safe in banks? No.

Why? It’s called “bank bail-in.” Bail-in allows failing institutions, including banks, to recapitalize by taking part of your money from your accounts, etc., with no recourse. Go to your computer and type in “bank bail-in.” Scary? It should be.

By implementing bail-in, the Dodd-Frank Act of 2010 claims to support taxpayers by ending bailouts. The act allows the Federal Deposit Insurance Corporation to recapitalize a failing institution by taking your money — deposits — to bail them out. Credit unions are exempted. This goes deeper, and includes global financial institutions, because the financial system is intertwined.

Did you know Bank of America and Chase have more unsecured debt obligation than the gross national product of America? Everything stated above and much more that you must know can be found under “bail-in.” If Congress does not act soon to restore the Glass-Steagall Act, then say goodbye to money.

Arthur Miller

Eureka

Link to original article…

Posted at 12:26 AM (CST) by & filed under General Editorial.

Dear CIGAs,

If this continues, it is a declaration of economic war that will trigger significant repercussions that will rock world currency markets.

Russia says JP Morgan blocked embassy money transfer
MOSCOW, April 1 Tue Apr 1, 2014 5:51pm BST

(Reuters) – Russia’s Foreign Ministry said on Tuesday that U.S. bank JP Morgan had blocked a payment from its embassy in Kazakhstan to insurance agency Sogaz "under the pretext of anti-Russian sanctions imposed by the United States".

The foreign ministry criticised the move in a statement as "unacceptable, illegal and absurd" and warned that any actions against a Russian diplomatic mission would affect the work of the U.S. embassy and consulate in Russia. (Reporting by Thomas Grove)

Link to article…

http://uk.reuters.com/article/2014/04/01/ukraine-crisis-russia-usa-banking-idUKL5N0MT4HU20140401

Posted at 1:56 PM (CST) by & filed under Q&A Sessions.

Dear CIGAs,

We are happy to announce the next upcoming Q&A session.  Coming to Canada, I would like your input on the topics you would like me to focus on for your meeting. You can email your suggested topics to Anna at [email protected] .

Cost:

A fee of $100.00US can be made in advance with any major credit card via the PayPal button on the webpage linked below (no PayPal account required). Please be sure to print out your transaction receipt as this will be your registration, confirmation and entry ticket to the meeting. No further confirmation will be sent.

If you prefer, you may alternatively pay $100.00US by cash, bank check or money order made payable to James Sinclair at the door. If you choose this option, you must pre-register via email with Anna Stoerzinger at [email protected]. Please be sure to note your name and number of seat(s) in your email. A confirmation will be sent to you within 5 business days to confirm this pre-registration.

We look forward to seeing you there!
Jim

Date:

Saturday, April 26th, 2014 from 1-5pm

Location:

Pearson Hotel & Conference Centre Toronto Airport
240 Belfield Road
Toronto, Ontario

 

Click here to purchase tickets…

Posted at 10:16 AM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

Paw friends of the Sinclair Clan.

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Crimea: Too small to matter
By Nicholas Wapshott
April 1, 2014

That is implicit in President Barack Obama’s remarks about where the Ukraine crisis heads next; the terms of the Paris talks between Secretary of State John Kerry and the Russian Foreign Minister Sergey Lavrov, and the West’s rejection of military action to hurl back the occupying Russian forces.

That Crimea is gone forever is also the view of former Defense Secretary Robert Gates, who declared, “I do not believe that Crimea will slip out of Russia’s hand.”

It is now generally accepted in Washington that short of sparking a shooting war, Crimea is lost and will now always be Russian. President Vladimir Putin, presiding over an economy of $2 trillion, barely equal to California, has roundly defeated the United States and the European Union, with a combined worth of more than $34 trillion.

The loss of Crimea is a considerable blow to U.S. prestige and confirmation that Obama holds a weak hand in Ukraine, a country everyone agrees is too hard to defend from Russian aggression. But why has Obama’s response to Russia’s stealth invasion of Crimea been so muted?

More…

Is the U.S. stock market rigged?

March 30, 2014, 7:24 PM|Steve Kroft reports on a new book from Michael Lewis, "Flash Boys," that reveals how a group of unlikely characters discovered how some high speed traders work the stock market to their advantage.

Click here to watch the video…

Jim Sinclair’s Commentary

A strategy of provocation.

Nato plans stronger military ties to ex-Soviet states south of Russia
Foreign ministers consider holding joint exercises with Azerbaijan, Armenia and Moldova after annexation of Crimea
Ian Traynor in Brussels
theguardian.com, Tuesday 1 April 2014 07.21 EDT

Nato has drawn up plans to strengthen military co-operation with the former Soviet states on Russia’s southern flank after the Kremlin’s seizure of Ukraine’s Black Sea peninsula of Crimea.

Nato foreign ministers were meeting in Brussels on Tuesday to discuss the alliance’s response to the Ukraine crisis amid continued fears of Russia’s territorial ambitions and what the Americans term a "tremendous" buildup of Russian forces on Ukraine’s eastern border.

Before the meeting, a Nato committee drafted plans "for promoting stability in eastern Europe in the current context" by increasing military co-operation with Armenia, Azerbaijan, and Moldova – all in Russia’s "near abroad" and considered by Moscow as falling within its sphere of influence.

A confidential seven-page paper leaked to the German news weekly Der Spiegel proposed joint exercises and training between Nato and the three countries, increasing the "interoperability" of their militaries with Nato, and their participation in Nato "smart defence" operations.

The paper also proposed opening a Nato liaison office in Moldova, military training for Armenia, and projects in Azerbaijan aimed at securing its Caspian Sea oil and gas fields.

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NATO suspends civilian and military cooperation with Russia
Published time: April 01, 2014 15:32
Edited time: April 01, 2014 18:33

NATO has announced that it is suspending all military and civilian cooperation with Russia over the Ukrainian crisis, the bloc said in a joint statement.

"We have decided to suspend all practical civilian and military cooperation between NATO and Russia. Our political dialogue in the NATO-Russia Council can continue, as necessary, at the Ambassadorial level and above, to allow us to exchange views, first and foremost on this crisis," the statement reads. The alliance plans to review its relations with Russia at a meeting in June.

The decision could affect cooperation on Afghanistan in areas such as training counter-narcotics personnel, maintenance of Afghan air force helicopters and a transit route out of the war-torn country.

NATO foreign ministers also urged Moscow in "to take immediate steps … to return to compliance with international law."

The bloc said that it was stepping up its cooperation with Ukraine, promoting defense reforms and increasing the activity of a liaison office in Kiev.

More…

Why Did BRICS Back Russia On Crimea?
Submitted by Tyler Durden on 03/31/2014 22:52 -0400

Submitted by Zachary Zeck of The Diplomat,

There’s been no shortage of reports and commentaries on the crisis in Ukraine and Crimea, and Russia’s role in it. Yet one of the more notable recent developments in the crisis has received surprisingly little attention.

Namely, the BRICS grouping (Brazil, Russia, India, China, and South Africa) has unanimously and, in many ways, forcefully backed Russia’s position on Crimea. The Diplomat has reported on China’s cautious and India’s more enthusiastic backing of Russia before. However, the BRICS grouping as a whole has also stood by the Kremlin.

Indeed, they made this quite clear during a BRICS foreign minister meeting that took place on the sidelines of the Nuclear Security Summit in The Hague last week. Just prior to the meeting, Australian Foreign Minister Julie Bishop suggested that Australia might ban Russia’s participation in the G20 summit it will be hosting later this year as a means of pressuring Vladimir Putin on Ukraine.

The BRICS foreign ministers warned Australia against this course of action in the statement they released following their meeting last week. “The Ministers noted with concern the recent media statement on the forthcoming G20 Summit to be held in Brisbane in November 2014,” the statement said. “The custodianship of the G20 belongs to all Member States equally and no one Member State can unilaterally determine its nature and character.”

The statement went on to say, “The escalation of hostile language, sanctions and counter-sanctions, and force does not contribute to a sustainable and peaceful solution, according to international law, including the principles and purposes of the United Nations Charter.” As Oliver Stuenkel at Post Western World noted, the statement as a whole, and in particular the G20 aspect of it, was a “clear sign that [the] West will not succeed in bringing the entire international community into line in its attempt to isolate Russia.”

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Jim Sinclair’s Commentary

This is automated front running of orders, a crime in my time.

FBI Investigating High-Speed Trading Examination Centers on Possible Trading on Nonpublic Information
Scott Patterson and Michael Rothfeld
Updated March 31, 2014 9:59 p.m. ET

The Federal Bureau of Investigation is probing whether high-speed trading firms are engaging in insider trading by taking advantage of fast-moving market information unavailable to other investors.

The investigation, launched about a year ago, involves a range of trading activities and is still in its early stages, according to a senior FBI official and an agency spokesman. Among the activities being probed is whether high-speed firms are trading ahead of other investors based on information that other market participants can’t see.

Among the types of trading under scrutiny is the practice of placing a group of trades and then canceling them to create the false appearance of market activity. Such activity could be considered potential market manipulation by encouraging others to trade based on false orders.

Another form of activity under scrutiny involves using high-speed trading to place orders to conceal that the transactions are based on an illegal tip.

"There are many people in government who are very focused on this and who are concerned about it and who think it breaks the law," an FBI spokesman said. "There is a big concern that high-frequency traders are getting material nonpublic information ahead of others and trading on it."

Ultimately, federal prosecutors would have to decide whether the facts of a specific case warrant bringing charges, the FBI official said.

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Jim Sinclair’s Commentary

Bail in is certain.

‘Bail-in’ deal raises risk to bank deposits
By Ellen Brown

On March 20, 2014, European Union officials reached an historic agreement to create a single agency to handle failing banks. Media attention has focused on the agreement involving the single resolution mechanism (SRM), a uniform system for closing failed banks. But the real story for taxpayers and depositors is the heightened threat to their pocketbooks of a deal that now authorizes both bailouts and "bail-ins" – the confiscation of depositor funds.

The deal involves multiple concessions to different countries and may be illegal under the rules of the European Parliament, but it is being rushed through to lock taxpayer and depositor liability into place before the dire state of eurozone banks is exposed.

The bail-in provisions were agreed to last summer. According to Bruno Waterfield, writing in the UK’s Telegraph in June 2013:

Under the deal, after 2018 bank shareholders will be first in line for assuming the losses of a failed bank before bondholders and certain large depositors. Insured deposits under 85,000 pounds sterling (US$142,000, or 100,000 euros) are exempt and, with specific exemptions, uninsured deposits of individuals and small companies are given preferred status in the bail-in pecking order for taking losses… Under the deal all unsecured bondholders must be hit for losses before a bank can be eligible to receive capital injections directly from the ESM [European Stability Mechanism], with no retrospective use of the fund before 2018.

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German execs criticize West for allowing tension with Russia to rise
Source: Reuters – Sat, 29 Mar 2014 04:10 PM
By Maria Sheahan

FRANKFURT, March 29 (Reuters) – Several top German executives criticised the strategy of the U.S. and Europe in dealing with Russia after it took control of the Crimea region, fearing the consequences for their businesses.

The European Union, United States and other Western nations have imposed sanctions on Russia in response to its seizure of the Crimea region of Ukraine and have threatened broader economic penalties if the crisis escalates, triggering the worst East-West clash since the Cold War.

Steelmaker ThyssenKrupp’s Chief Executive Heinrich Hiesinger told daily newspaper Die Welt that the events of the past had shown that great change could be achieved if the West cooperated with Russia rather than being confrontational.

"Now we have a situation in which Russia feels that its back is against the wall," he said in an article published on the paper’s website on Saturday.

Russia is Germany’s 11th biggest commercial partner, with trade reaching 76.5 billion euros ($105 billion) last year, according to the trade association Ost Ausschuss.

Many companies are worried about losing out on business if further sanctions take effect. Some 300,000 German jobs are linked to business there and Europe’s biggest economy depends on Russia for 35 percent of its gas.

"Many German companies that invested in Russia last year or wanted to build production sites there have now given up their plans or put them on ice," Bernd Hones, Economic Correspondent at economic development agency Germany Trade & Invest in Moscow, told weekly paper Frankfurter Allgemeine Sonntagszeitung.

More…

Posted at 10:15 AM (CST) by & filed under Jim's Mailbox.

Jim,

I guess the West has a death wish for the SWIFT system and the end of the petro dollar. I cannot believe how stupid the banksters and their political counterparts are.

CIGA Craig

Monetary Blockade Of Russia Begins: JPMorgan Blocks Russian Money Transfer "Under Pretext" Of Sanctions
Submitted by Tyler Durden on 04/01/2014 14:56 -0400

While the flare up of Cold War 2.0 may seem like last week’s news, overnight something very notable happened that so far virtually nobody appears to have paid attention to. According to Russian Kommersant, none other than the biggest US bank, JPMorgan, was reported to be "reviewing counterpart relations with all Russian lenders" citing unidentified people. The review is part of JPMorgan’s push for transparency in banking and not part of sanctions against Russia over Crimea. Perhaps this is true: Kommersant added that Sberbank and VTB were contacted in January and February while another unidentified bank recently received letter saying JPMorgan would cease correspondent accounts with them on April 1.

JPM cleaning up its act is certainly plausible: after all the last thing the bank that has paid out nearly $30 billion in legal charges, penalties and settlements in the past few years need right now is more legal charges due to laundering Russian billionaires’ cash (coughHSBCcough) at a time when Russia, which has humiliated the US state department twice in under a year, is hardly perceived as a critical ally to the US. So one can see why JPM would be cautious in transacting with Russia financial entities.

And yet, while the headline sanctions so far have involved mostly freezing of Russian politician and oligarch assets in jurisdictions in where there were no such assets, it appears that JPM has not only escalated on its own but taken the Russian sanctions to an entirely new level: one which may quite promptly devolve into a complete monetary blockade of all of Russia.

Exhibit A:

Wait, did JPM just take a unilateral action, not mandated by the state department (because nowhere in the Russian sanction list does it say putting a freeze on Russian bank transfers), and refuse to process a simple money transfer? Why? And if indeed JPM is doing this, how long until all other US banks, most of which are just as allegedly criminal in dealing with offshore sources of illegal money, follow suit and leave Russia entirely in the world when it comes to USD-backed transactions.

More…

Jim,

By any standards credit risks are much greater than those in 2005. To push rates down to those levels just demonstrates how desperate the ECB is.

CIGA Craig

Italy, Spain yields near historical lows as ECB meeting looms
By Emelia Sithole-Matarise
LONDON Tue Apr 1, 2014 7:19am EDT

Italian and Spanish yields dipped back towards their lowest since 2005 on Tuesday as investors bet the European Central Bank will signal its readiness this week to take stimulus measures in coming months to fight potential deflation.

The ECB holds its policy meeting on Thursday and though many expect it to hold fire on interest rates, a fall in March euro zone inflation to 0.5 percent, its lowest since 2009, has kept alive prospects it will ease monetary policy later in the year.

Pressure for ECB action grew when the EU’s top economic official, Olli Rehn, said prolonged low inflation would make it harder to correct imbalances in the region.

Peripheral euro zone bond yields have fallen to historical lows in recent days in anticipation of further policy easing from the ECB after a raft of dovish comments from policymakers, including the prospect quantitative easing.

More…

 

Jim,

Ukrainians are awakening to the screw-up the West has lead them into. I strongly suspect a 3x-4x increase in NG blow out proposed IMF bail-out.

CIGA Craig

Ukrainian Delegation to Visit Moscow to Discuss Gas Debt
18:49 01/04/2014

A Ukrainian delegation plans to visit Moscow on Thursday to hold talks on the country’s $1.7 billion debt for natural gas owed to Russia’s Gazprom, Ukrainian Energy Minister Yuriy Prodan said Tuesday.

"Our delegation will arrive in Moscow on Thursday and will discuss the issue," Prodan said.

The minister earlier announced a meeting this week between the new head of Ukraine state gas company Naftogaz, Andriy Kobolyov, and Gazprom CEO Alexei Miller, saying that Kiev plans to discuss the price for imported gas, as well as the payment for the transit of Russian gas through Ukraine to Europe.

Gazprom announced on Tuesday that Ukraine will pay $385.5 per 1,000 cubic meters of Russian gas starting from April 1, up $117 from the current price. The Russian company cancelled its discount for Ukraine because Kiev already owes Russia $1.7 million in arrears and had failed to pay for the current supplies in advance.

Another discount on natural gas to Ukraine was also canceled on Tuesday, part of a former deal providing for the basing of the Russian Black Sea Fleet in Crimea, which is now Russian territory.

More…

Jim,

Hank is worried about the current economic climate. Please tell me it ain’t so. How he is even permitted to talk in front of the US press stretches all boundaries of credulity. Does he really think he has any credibility left after bailing out the banksters and making them too big to fail?

CIGA Larry

Former Treasury Secretary Warns Of Looming Financial CRISIS

In a new documentary produced by Bloomberg Businessweek and distributed exclusively by Netflix, Henry Paulson, former President George W. Bush’s Treasury secretary recounts what happened during the financial crisis of 2008. In a classic "we must learn from history" stance, Paulson expresses concern about the current economic climate and claims that this concern, in part, motivated the production of the documentary.

In a Washington Times interview, Paulson wonders why Congress has not taken steps to reign in Fannie Mae and Freddie Mac, organizations that have only expanded in the years since the Troubled Asset Relief Program (TARP) bailout. Paulson claims that the market for private mortgages has nearly disappeared, making mortgages far too dependent on entities such as Fannie Mae, Freddie Mac, and the Federal Housing Authority (FHA). In order to avert a replay of the mortgage crisis, Paulson believes that no organization, government or private, should be considered "too big to fail."

One reason that reform has not occurred, postulates Paulson, is that the Fannie and Freddie have returned to profitability, and this profit has been crucial in providing funding for the Treasury, which continues to struggle with deficit budgets. But Paulson’s concern goes beyond government entities. He also enumerates several private banks that have grown into the "too big to fail" category, but he praises the new regulations of Dodd-Frank that requires banks to have significant liquidity.

More…

Posted at 1:14 PM (CST) by & filed under General Editorial.

Dear CIGAs,

We are looking for your feedback as to when to hold our next Q&A Session. This session will be held the weekend of April 19th or 26th in Toronto, ON.

If you are interested in attending either session, please email your preference weekend with Toronto in the subject line to Anna at [email protected].

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

Dan Duval
JSMineset Editor

Posted at 1:08 PM (CST) by & filed under In The News.

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Ron Paul: Ukraine aid bill is bad deal for all
Published time: March 31, 2014 15:46

Following Congress’ decision to approve a $1 billion aid package to Ukraine last week, former libertarian Congressman Ron Paul has published an op-ed strongly criticizing it as a bad deal for both American taxpayers and Ukrainian citizens.

In the column, published by Ron Paul Institute for Peace and Prosperity, the iconic libertarian said the bill effectively puts the International Monetary Fund (IMF) in charge of the Ukrainian economy, needlessly directs money towards “democracy promotion” and additional sanctions on Russia. He also accused the US government of ignoring its own role in the crisis currently unfolding in Eastern Europe.

Paul said the economic plan outlined by the IMF would raise energy prices and taxes in Ukraine, as well as freeze wages and make life more difficult for the average citizen.

“This $1 billion for Ukraine is a rip-off for the America taxpayer, but it is also a bad deal for Ukrainians,” he wrote. “Not a single needy Ukrainian will see a penny of this money, as it will be used to bail out international banks who hold Ukrainian government debt.”

A longtime opponent of foreign aid, Paul has often criticized the concept for lining the pockets of rich citizens and the ruling class instead of helping the people it’s intended to.

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Posted at 12:50 PM (CST) by & filed under Jim's Mailbox.

Jim,

I am not sure what Kerry thinks he is gaining in this stance.

CIGA Craig

The U.S. and the European Union have vowed to intensify sanctions on Russia’s military, energy and financial industries if it pushes further into Ukraine. Kerry said the U.S. considers Russia’s actions to be “illegal and illegitimate” and that it’s “on the wrong side of history.”

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