Posted at 6:00 PM (CST) by & filed under Jim's Mailbox.


Follow up to my “300″ email:

moments ago

CIGA Wolgang Rech


We are going to do nothing for them. They will have to be “Today’s 300″ and I pray for their courage and victory.

They are our best.


ISIS Breaches US Military Advisers’ Iraqi Base
Submitted by Tyler Durden on 02/13/2015 – 13:39

Just as we warned hours ago, it appears the capture of a nearby town was not the endgame and, as The Wall Street Journal reports, A group of Islamic State militants penetrated an Iraqi air base where U.S. military advisers are training Iraqi forces, the first time attackers have gotten beyond the outer perimeter of an Iraqi base being used by American trainers.




I can’t, for the life of me, believe everyone isn’t taking gold seriously.

-Every Central Bank is purchasing gold (USA excluded).
-Every nation is debasing their currency to stay alive.
-Negative interest rates make gold more attractive than anything.
-We’ve never been closer to war than today.
-China, Russia, and Iran look very likely to back their currencies with gold.
-Potential collapse of COMEX

If the new Shanghai Gold Exchange is selling massive amounts of gold, primarily to the Chinese, at spot prices (which are manipulated and most likely artificially depressed)… then who are the sellers? Whoever it is, they must be buying contracts on the Comex to hedge themselves.

I’m not familiar with the commodity exchanges and how they operate, but something doesn’t jive.

The question remains, when physical gold slowly disappears, how will the Comex honor those commitments? Sure they can pay you off in currency in lieu of delivery, but what about the guy who bought in Shanghai and is expecting nothing less than delivery?

I see all hell breaking loose.

CIGA Wolfgang Rech

Central Bank Gold Purchases Increased In 2014 Says WGC As Sweden Enters Currency Wars
GoldCore on 02/13/2015 08:43 -0500

Sweden’s move is likely to put pressure on Norway to follow suit to protect its exports given the large amount of trade among the Scandinavian countries. The Bank of England is also considering a rate cut.

The race to the bottom continues unabated in the currency wars. When they reach their logical conclusion it will be gold that is the last man standing.


Gold In A Negative Interest Rate World
by John Rubino on February 12, 2015

The logical conclusion is that if gold and cash both cost the same to own, then maybe gold — which has held its value over millennia while every previous fiat currency has evaporated — is the better bet.

In Switzerland, this is apparently already happening:

Global capital is looking for a place to hide. But after decades of enthusiastic currency creation and financial engineering, there’s way too much of it for any one country to accommodate. This mismatch between money knocking at the door and available space is leading the handful of remaining safe havens to put up “no vacancy” signs in order to avoid being swamped. Among the things they’re trying is negative interest rates. That is, if you want to deposit money in a Swiss or Danish bank or lend money to the Japanese or German governments you now have to pay them for the privilege.

This sounds a little crazy, and from a historical perspective it is indeed highly unusual. But it’s exactly what you’d expect in a world of ever-increasing debt and ever-more-exotic financial speculation: Too much bad paper gets created which eventually blows up, causes instability and leads worried investors to value return of capital over return on capital. They all pile into whatever seems most likely to still exist a decade hence, forcing (or enabling) the managers of those assets to charge rather than pay interest.




With this news…

Fighting Rages After Ukraine “Ceasefire” Deal; Ukraine Ultranationalist Leader Rejects Peace Agreement
Submitted by Tyler Durden on 02/13/2015 – 12:14

“A ceasefire is due to come into effect from Sunday under the agreement, which also envisages a withdrawal of the heavy weapons responsible for many of the 5,000 casualties in the conflict that broke out almost a year ago. Kievsaid pro-Russian rebels had built up their forces across separatist-held zones since the deal and both sides accused each other of killing civilians.” There is still hope that on Sunday morning things will be different. Yet, one element that is certain to undermine any deal, in addition to the now usual suspects because after all this is a proxy civil war with far greater geopolitical interests involved, is Ukraine’s ultranationalistic Right Sector, whose leader Dmitry Yarosh today said his radical movement rejects the Minsk peace deal and that their paramilitary units in eastern Ukraine will continue “active fighting” according to their “own plans.”


…is it any wonder that NATO finds this…

NATO’s Stoltenberg Claims “Documented Evidence” Of Russian Military Presence In Ukraine, OSCE Chief Says No
Submitted by Tyler Durden on 02/13/2015 – 12:51

For the 4th time in February, NATO dispatched Typhoon jets to track a Russian Il-20 today over The Baltic Sea. However, as fighting rages in Ukraine – despite the apparent market excitement at a truce deal – today’s biggest news is NATO Secretary General Jens Stoltenberg’s claims that his alliance has evidence of Russian military presence in Ukraine, despite the’independent’ OSCE chief having stated he saw no Russian troops in Ukraine’s east. One wonders if NATO has YouTube proof like that of the American-accented fighter we recently noted.


Peace in our time? Where have I heard that before? (Hint: Munich Agreement 1938 N. Chamberlain).

Only if all parties on each side are truly in agreement, can we achieve anything.

CIGA Wolfgang Rech



My greatest fear (from the movie “300″)

The plot revolves around King Leonidas, who leads 300 Spartans into battle against the Persian “god-King” Xerxes and his invading army of more than 300,000 soldiers.


My prayers are with them.

CIGA Wolfgang


I am concerned for these heroes as our recent history is to sacrifice heroes and forget them.


300 US Troops In Iraq Under “Severe Threat” After ISIS Seizes Nearby Town
Submitted by Tyler Durden on 02/13/2015 – 09:34

While military officials have stated that their “advisers” are not involved in the fighting, WaPo reports that ISIS militants have seized an Iraqi town within two miles of the Ayn al-Asad base where 300 US military advisers are stationed. The region remains under “severe threat” and the local council has called for “immediate and urgent military reinforcements” after the attack on the town of al-Baghdadi, which began in the early morning.” It seems those non-boots-on-the-ground advisers are about to get a taste of what President Obama promised they would not…


Posted at 10:39 AM (CST) by & filed under In The News.



Jim Sinclair’s Commentary

Mr. Williams shares the following with us.

- January Retail-Sales Plunge Is on Track for a First-Quarter Contraction, Both Before and After Inflation Adjustment
- The Better-Quality Headline Data are Showing a Marked Downturn in Broad Economic Activity
- Gasoline and Oil Prices Appear to Be Bottoming

“No. 696: January Retail Sales, Slowing Economy”


2015 Omni-dimensional crisis: protecting oneself in stormy weather

The enormous dangers weighing on the banking and financial systems, especially in the West, but also on social and geopolitical peace, leads our team to warn our readers to be especially on their guard. The issue is protecting one’s assets creatively, with diversification of solutions always the principal instruction. For example reduce the share of one’s assets invested in financial products; reduce the share of one’s assets deposited with conventional Western banks; the purchase of gold especially, but also jewellery, precious metals…, remains our first recommendation, up to 20% to 30% of one’s portfolio; for the remaining assets at the banks, think about the safest foreign banks as well, especially Chinese…







PEACE In Our Time.
By Bill Holter

It’s PEACE!  Russia and Ukraine have reached another cease fire agreement (maybe their 5th?) which will begin Sunday.  Let’s see if this one holds?  Ukraine cannot continue hostilities without the U.S. supplying them.  What will U.S. reaction to this agreement be?  The U.S. was specifically not invited to these talks, when has that ever happened before?  The big question in my mind is, do continue to arm them?  And if we do, what will this look like to the rest of the world? To Europe?  I view this agreement as one more well thought out move by Russia, how can they be called the “bad guy” after this deal?  We will either have peace …or the U.S. will be seen in a very poor light by Europe and it may spur more rapid movement Eastward, we will see!  Is this for real or merely more propaganda?  My guess is yes, it is for real, whether it stays for real without U.S. meddling is another question.

  “Propaganda” has been standard “financial” operating procedure for years.  What I am alluding to is a major league push to downplay Greece (and of course Ukraine) and the insolvency ramifications.  First thing Monday morning, while we continued to get the game of “deal or no deal”, we were also being barraged with “Greece is not such a big deal”.  Greece IS a big deal and very well may be THE deal which exposes the insolvency of the entire system.

  As mentioned before, Greece in total may be $3 – $5trillion total exposure, or more.  This is a very large sum, just think back to 2008 where if Congress did not approve the “measly” (huge at the time!) sum of $700 billion for TARP, we were told we would be thrown into the dark ages and martial law.  Already, Spanish and Italian yield spreads and CDS have begun to widen.  This is front running to the contagion that will take place and spread from market to market.  While Greece itself in a normal world without CDS and other levered derivatives really would not be such a big deal…it is now, because there is zero margin (pun) left for error.

  When, not if Greece defaults, triggers everywhere will be pulled.  Please do not tell me “but their debt can be extended 60-70 years into the future” because this in and of itself is a default.  Greek bonds will need to be marked to market at only a few cents on the euro.  Even assuming a markdown of “only” 50% will destroy the balance sheets of banks, central banks and the ECB itself.  Losses will actually have to be “booked” and capital ratios will be destroyed.  In normal times these capital shortfalls could be plugged with either debt or equity raises, these are not options now and surely won’t be in crashing and illiquid markets.  To illustrate just how precarious the situation is (and not even in “crisis” yet), central banks across the globe are ALREADY monetizing more than 100% of debt issuance.  Yes, this “is” currently working, has outright monetization ever worked before?  And now on nearly a global scale?  Monetization will work until one day it does no longer, what will markets look like then?  What will have value?

  We are already seeing the contagion to Spain and Italy, both in the same fiscal and monetary vice Greece is in.  Unemployment, as in Greece is rampant in Spain and Italy while both have debt ratios in banana republic zones.  I mention this because of the contagion factor.  Once Greece either quits, declines to pay or is kicked out of the Eurozone, …or agrees to an unlikely restructuring, the euro itself will collapse (again) in purchasing power.  The Swiss may have kicked off the devaluation, it very well may be the Greeks who finish it off.   This very well may end in a north and south euro or with a Eurozone with several southern entities not included.  A much stronger euro may be the ultimate result should excess and bankrupt baggage be shed.  Please understand that the ECB itself holds Greek debt, at par, which supports the value of the euro.  Isn’t this is like two drunks trying to hold each other from falling down?

  Just as with the Swiss reset, trade all throughout Europe will be thrown into disarray with huge overnight losses taken and business models rendered obsolete.  I believe some very big and long term business decisions will need to be undertaken.  Greece, Spain and Italy, as well as the rest of Europe will need to decide “who” they will trade with going forward. This is where Russia enters the picture and why European alliances with Russia/China are so important.  After a collapse of the euro and during the thought process of “where to now?”, European industrialist will have a decision to make.  Do they continue to trade with the U.S., accepting dollars for trade …or do they turn their attention East and probably toward a gold ratio’d currency?  In my opinion there will be a very large deciding factor.  Will Europe choose to do business with a region who’s hey-day is behind them and who’s consumers are leveraged to the gills …or, will they prefer to do business with a region who’s future is bright and has well over 1 billion potential consumers who are not in debt and still saving for their first big screen TV?  Do you see?  Do you see how “natural” any pivot of Europe toward the Russia/China alliance is? 

   This thought process is of utmost importance to you as an individual because the answer to the above question(s) will affect you directly.  Will the status quo hold?  Will it snap?  If it snaps, which way will the world “lean”?  The last two+ years have been designed (choreographed) to show you the new world will lean West, toward the dollar and away from gold.  It is so important at this junction to ignore the trees and see the forest for exactly what it is.  We are on the cusp of a New World Order, only not the NWO the neocons had envisioned.  The vast majority of the world, 135 nations or more are already preparing for a turn from the dollar’s hegemony, away from false and lopsided trade, away from ugly financial and diplomatic deals …and toward real and fair weights, measures and business dealings.

  Today’s juncture of time is very close to the equivalent of 1944 where nations met in Bretton Woods, New Hampshire to decide on a new monetary, financial and trade arrangement.  A new “arrangement” is undoubtedly coming.  By agreement, by default (pun intended), peacefully or forcefully.  Gold by default, will be a very central pillar of whatever new system arises, the rest of the world’s actions are plainly telling you this.  Know this and you have already won more than half the battle!  …The rest of the battle may not be quite as easy.

Bill Holter


Central Banks Are Boosting Their Gold Reserves
by Eddie Van Der Walt Nicholas Larkin
12:00 AM EST
February 12, 2015

(Bloomberg) — Central banks purchased enough gold in 2014 to buy 75 Boeing Co. Dreamliners.

Governments added 477.2 metric tons to their reserves, the second-biggest increase in 50 years and 17 percent more than a year earlier, the World Gold Council said in a report Thursday. Based on the average price of gold in 2014, central banks probably paid about $19.4 billion. A Boeing 787-9 has a $257.1 million retail price, according to the company’s website.

Central banks have added to gold reserves for the past five years, a reversal from two decades of selling since the late 1980s. Purchases will be at least 400 tons this year, according to estimates from the London-based council, which represents 17 gold producers. Total demand for gold fell last year as Chinese consumers bought less jewelry, bars and coins.

“There is a lot of scope for emerging market central banks to expand their holdings as these are still significantly underweight,” Alistair Hewitt, head of market intelligence at the council, in a phone interview on Wednesday. “Demand from this sector is going to remain robust.”

Russia was the biggest buyer of gold, while Ukraine sold the most as fighters from both countries clashed along Ukraine’s eastern border.


Posted at 10:32 AM (CST) by & filed under Jim's Mailbox.


I was just looking at some articles this morning regarding 2015 job cuts. This is aside from the massive layoffs in 2014 in the Retail and Technology and Financial sectors.

-Halliburton To Cut Up To 6,500 Jobs
-Norway oil sector braces for 40,000 job cuts amid downturn …
-Siemens to Cut 7,800 Jobs Worldwide
-IBM To Cut More Than 110,000 Jobs
-Schlumberger Cuts 9,000 Jobs
-Baker Hughes to cut 7,000 jobs
-EBay Plans 2,400 Job Cuts, Icahn
-Oil services job cuts reach 25,000

No way are we going to “ease up on easing”, in my opinion, unless we create a few wars and put those unemployed into uniform. But then, that still requires monetary support.

CIGA Wolfgang

Posted at 1:21 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

Security now takes up the entire couch.



Jim Sinclair’s Commentary

The US economy has reached to velocity of what?

Food Stamp Beneficiaries Exceed 46,000,000 for 39 Straight Months
February 10, 2015 – 3:49 PM
By Ali Meyer

( – The number of beneficiaries on the Supplemental Nutrition Assistance Program (SNAP), also known as food stamps, has topped 46,000,000 for 39 straight months, according to data released by the Department of Agriculture (USDA).

In November 2014, the latest month reported, there were 46,271,508 Americans on food stamps. Food stamp recipients have exceeded 46 million since September 2011.


The 46,271,508 on food stamps in November was down from the 46,477,678 on food stamps in October – a decline of 206,170.

As of July, the national population was 318,857,056, the Census Bureau estimates. Thus, the 46,271,508 on food stamps equaled 14.5 percent of the population.

There were 22,699,759 households on food stamps in November, which also declined from the previous month of 22,774,201 in October.

As of September, according to the Census Bureau, there were 115,831,000 households in the country. Thus, the 22,699,759 households on food stamps in November equaled 19.6 percent of the nation’s households.

The 46,271,508 people on food stamps in the United States also exceeded the total populations of Columbia (46,245,297), Kenya (46,245,297), Ukraine (44,291,413) and Argentina (43,024,374).



Europe’s Greek Contagion Update: Peripheral Bonds Risk Surges
Submitted by Tyler Durden on 02/11/2015 12:26 -0500

While US equities suggest all is well and Greece is contained, the less mainstream-news indicators of European stress are starting to flash orangey/red as the surge in spreads across European peripheral bonds since the Greek election suggests Q€ is being over-run. Italian, Spanish, and Portuguese bond spreads are all wider on the year now and up 25-30bps from ther Greek Election (fastest rise in months). Greek bank bonds and stocks remain near record lows and even broad European stock indices are struggling to hold gains post-election.

Greek bank stocks have fallen and can’t get up..


and Greek bank bonds are at record lows…


And the contagion is clearly spreading…



Posted at 1:20 PM (CST) by & filed under Jim's Mailbox.


What more can one ask for?

The world is admitting they will undertake currency depreciation! They are giving you the opportunity of a lifetime. Take it!


CIGA Wolfgang


Hey Jim,

Hope you are doing well. I put together an updated commentary with Eric Sprott that might be of interest to your readers. Includes some commentary on gold.

CIGA Tekoa

Eric Sprott: Expect Physical Gold Backing of Currencies Within Next Decade
Tuesday, February 10, 2015
Tekoa Da Silva

During a time of currency volatility and returning strength in precious metals, Eric Sprott, Chairman of Sprott Inc. was kind enough to share a few comments.

Regarding currencies, Eric noted that “I’m kind of shocked that the most volatile sector of the financial market right now is the currencies… it really should be bonds or stocks, but it now seems to be currencies.”

Higher risks within global currency markets buttress, “An awesome outlook for gold,” Eric added. “Last year, 84% of the world’s population would have made money owning gold because of various currency moves—even though gold in US dollars was down approximately 1%.”

Commenting on the root cause of growing currency gyrations, Eric noted that, “The whole precept that printing money is good…that somehow zero interest rates and negative interest rates are good, is totally fallacious…It’s so unimaginable and yet somehow the investment public has bought into it…Things are unstable here…So I imagine probably in less than 10 years we will see physical assets backing currency. Of course, the most likely physical asset is gold.”

Here are his full interview comments with Sprott Global Resource Investment’s Tekoa Da Silva:

Tekoa Da Silva: Eric, we recently saw a move in gold from about $1150 oz. to $1300 oz. in US dollars with a backdrop of some pretty interesting currency gyrations around the world. What goes through your mind here as you look at gold?


Posted at 10:27 AM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

John Williams of shares the following with us.

- Consistent and Corrected BLS Payroll-Employment Data Are Available Here to ShadowStats Subscribers
- Highly Volatile Inconsistenciesi n Payroll Reporting
- Comparable with January 2015 Payroll Reporting, November Jobs Gain Was 340,000, Not the Headline 423,000
- Similar Quality Issues Plague Unemployment Data

“No. 695: Payroll-Employment Revisions – Corrections to Inconsistent Reporting”


A spade can never be called a spade
By Bill Holter.

Yesterday we looked at the situations in both Ukraine and Greece, and how they are both out of money which makes them potential “flash points” for reality to set in.  What I’d like to talk about today are the various “slights of hand” and why a spade can never be called a spade.

  Currently in the U.S., some (but certainly not all) of the recent economic numbers are showing an absolutely booming economy.  All you need to do is look at Friday’s unemployment numbers, they were clearly bogus.  The biggest driver of employment over the last five years has been the boom in the oil patch …which is now busted with 1,000′s of pink slips being handed out.  BLS revised the November and December numbers to show the fastest growth of employment for any three month period …so far this century!  Really?  Do you believe this in any fashion at all?

  The economic and financial lies are getting bigger and bigger while the economy is shrinking and the financial position is more perilous.  The gap between the reality and the true conditions have never before in history been this wide.  Stocks are not allowed to drop, institutions are not allowed to fail, heck, financial institutions have been “told” not to mark to market as this would expose failures.  Inflation is understated, employment is overstated, gold is not allowed to rise and the game continues. Everything you now see and hear has one goal behind it, hide the reality at any and all costs.

  The situation with Greece is very sticky for the West for several reasons.  Each and every one of them is because a Greek failure will expose the very ugly reality that the West is one big and interconnected series of Ponzi schemes constructed in pyramid fashion.  Greece cannot be allowed to fail because of what, how much, and who they owe.  In order for the reality to stay hidden, Greece absolutely must be forced to borrow more money so they have the ability to pay past debts.  Already this morning, a six month “trial balloon” extension has been floated.  If Greece is allowed to fail, other central banks (including and particularly the ECB) and many commercial banks will take some very real losses.  This CANNOT be allowed to happen because of the leverage factor and the fact that no more collateral exists within the system that’s not already encumbered.

  You see, many assets have been hypothecated (lent/borrowed against) many times over, including Greek debt.  In case you don’t see the problem here, I will spell it out.  When something is “lent” out or “borrowed” more than one time, it is theft pure and simple.  This truth cannot in any fashion come to the surface because it will create a “call”.  The original owners will flood in and ask for their security, their asset, (think gold) back.  What do you think the world will look like when 100 or so “owners” of the same asset decide they will not be one of the suckers who are left with nothing?  This will be a bank run on a system-wide basis and include nearly any asset type you can think of.



Jim Sinclair’s Commentary

Let us see how this gets killed.

Justice Department Is Seeking Felony Pleas by Big Banks in Foreign Currency Inquiry
By Ben Protess and Jessica Silver-Greenberg
February 9, 2015 10:00 pm

The Justice Department is pushing some of the biggest banks on Wall Street — including, for the first time in decades, American institutions — to plead guilty to criminal charges that they manipulated the prices of foreign currencies.

In the final stages of a long-running investigation into corruption in the world’s largest financial market, federal prosecutors have recently informed Barclays, JPMorgan Chase, the Royal Bank of Scotland andCitigroup that they must enter guilty pleas to settle the cases, according to lawyers briefed on the matter. The pleas would be likely to carry a symbolic stigma, if limited actual fallout, in handing felony convictions to some of the world’s biggest banks.

Yet even as those cases head toward negotiations over potential plea deals — a development that has not been previously reported — additional currency misconduct has surfaced in a New York state investigation, confidential documents show. The documents, excerpts from online chat rooms reviewed by The New York Times, suggest that banks designed electronic trading platforms that effectively drove up the price of currencies sold to clients. In the chats, replete with expletives and industry jargon, employees described and even joked about how the platform would cancel trades that ceased to be profitable for the bank.

New York’s financial regulator, Benjamin M. Lawsky, initially focused on platforms at Barclays andDeutsche Bank, but he has since subpoenaed four other banks: Goldman Sachs, Credit Suisse, BNP Paribas and Société Générale. None of the banks have been accused of wrongdoing, and they are cooperating with the investigation.

The Justice Department’s plea deals, if ultimately reached, would not cover any wrongdoing that surfaces from Mr. Lawsky’s investigation. Negotiations with the Justice Department are likely to center on which entity will plead guilty: the bank’s parent company, or a subsidiary that housed the misconduct. The banks, which have argued that the wrongdoing was isolated to midlevel employees, prefer that a subsidiary take the fall.

The currency case is expected to ensnare traders but not top-level executives. As a result, it may add fuel to the criticism that prosecutors have not charged one top executive on Wall Street. Without charges to mollify the public anger over the financial crisis, the recent cases have presented little more than a pyrrhic victory for the Justice Department.



Jim Sinclair’s Commentary

This looks like the beginning of the New Normal 100 years war.

Isis war to extend far beyond Iraq and Syria under Obama’s proposed plan
Sources say White House plan will bless anti-Isis war for three years and ensure that Obama, like George W Bush, will hand over two wars to his successor
Spencer Ackerman in New York and Dan Roberts in Washington
Tuesday 10 February 2015 17.12 EST

Barack Obama’s proposed framework for the US-led war against the Islamic State will not restrict the battlefield to Iraq and Syria, multiple congressional sources said on Tuesday, placing the US into a second simultaneous global war that will outlast his presidency.

Several congressional sources familiar with the outlines of the proposal, all of whom expected the White House to formally unveil it on Wednesday, told the Guardian the so-called Authorization to Use Military Force (AUMF) would bless the anti-Isis war for three years.

Congressional language to retroactively justify the six-month-old US war against Isis will not, they said, scrap the broad 9/11-era authorities against al-Qaida, as some congressional Democrats had proposed, meaning the two war authorizations will coexist.

Asked if the anti-Isis AUMF opens the US to a second worldwide war against a nebulous adversary, one congressional aide answered: “Absolutely.”

Two legislative aides with knowledge of the outlines of the White House proposal said the new AUMF would clarify that the 2001 authority, which Obama has cited to justify everything from drone strikes in Yemen to detaining Taliban combatants beyond the end of US combat in Afghanistan, will no longer apply to the war against Isis.

Those military contours would abandon Obama’s current contention that his legal authorities to confront Isis in the absence of explicit congressional approval stem partially from the 2001 AUMF, a contention that has papered over the furious division between Isis and al-Qaida. The 2002 authorization for invading Iraq and deposing Saddam Hussein, his other claimed residual legislative authority, would explicitly expire.



Jim Sinclair’s Commentary

Sheep, mule and donkey on their morning constitutional.



Jim Sinclair’s Commentary

In the West they become icons, talking heads and a financial celebrity.

China’s Solution To “Tyrannical” Billionaires Who Harm The Economy: Execution
Tyler Durden on 02/09/2015 22:25 -0500

In some countries, the ‘solution’ the state chooses for its ignominous billionaire class of inequality-garnering, economy-wrecking individuals is to either a) turn one’s back for a brief enough moment as to allow the tyrant to leave the country in search of a golden beach upon which to lament how great a trade being long European bonds would have been’ or b) enhance their wealth further on a quid pro quo basis. In China, the ‘treatment’ for corruptbillionaires who love casinos, cigars, and luxury cars is much simpler… execution.

As The Telegraph reports,

A Chinese billionaire famed for his love of casinos, cigars and luxury cars was executed on Monday in one of the most dramatic episodes yet in president Xi Jinping’s war on corruption.

Liu Han, a 49-year-old mining tycoon once worth at least £4.2 billion, was one of five alleged mafia kingpins to receive the death penalty after being convicted of offences including gun-running and murder.

The part-time God Father “tyrannised local people and seriously harmed the local economic and social order,” Xinhua, China’s official news agency, said in a brief dispatch announcing the execution.



Jim Sinclair’s Commentary

As the EU kills Greece it to will become a partner of Russia.

Russia reportedly getting military bases in an EU state
Elena Holodny
Feb. 8, 2015, 2:38 PM

UPDATE: On Monday, Russia said it would not be “creating” any bases on Cyprus and the Cypriot foreign minister denied a “Russia deal on bases.”


On Sunday, news outlets reported that Cyprus offered to let Russia install air and navy bases on its territory.

It was reported that Cypriot President Nicos Anastasiades announced that the country was ready to host Russian aviation and naval bases. The official agreement on military cooperation between the two nations is expected be signed on Feb. 25, according to

“There is an old [defense] agreement, which should be renewed as is,” Anastasiades said according to Lenta.Ru. “At the same time, some additional services will be provided in the same way as we do with other countries, such as, for example, with France and Germany. Cyprus and Russia have traditionally had good relations, and this is not subject to change.”

This announcement came after Russia in late January expressed interest in having a military base in Cyprus, according to the Global Post and Greek Reporter.


Posted at 4:45 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

Today in Connecticut.



Another JPMorgan Banker Dies After Murder-Suicide: Chokes Wife, Stabs Himself To Death
Submitted by Tyler Durden on 02/09/2015 14:14 -0500

By now, there have been so many banker-related suicides that it has become a moot point of i) tracking them all or ii) trying to find a pattern. And yet, one name continues to stand out: JPMorgan. The bank which has been most prominent among the list of “suicided” bankers notched one more casualty over the weekend when “a JPMorgan Chase & Co. employee strangled and stabbed his wife to death before turning the knife on himself, according to police who are treating the couple’s death in Bergen County, New Jersey as a murder-suicide.”

Bloomberg reports the gruesome details according to which Michael A. Tabacchi, 27, and his wife, Iran Pars Tabacchi, 41, were found dead Friday about 11:30 p.m. in the bedroom of their Closter home after a 911 call placed by the husband’s father, Bergen County Prosecutor John Molinelli said in an interview. Closter is located in northern New Jersey, about 20 miles (32 kilometers) from midtown Manhattan.

It wasn’t a nail-gun this time. It was a knife:

Autopsy results on Sunday showed the wife died of strangulation and a stab wound to the chest while Michael Tabacchi died from a single self-inflicted stab to the chest, he said.

As his LinkedIn profile below shows, Tabacchi was an associate for JPMorgan in its global custody product unit.



Jim Sinclair’s Commentary

Slowly but with determination the Petro dollar comes under attack. I guess full on war with Russia is now inevitable.

Moscow & Cairo to drop USD, use national currencies in bilateral trade – Putin
Published time: February 08, 2015 23:10
Edited time: February 09, 2015 10:08

Russia and Egypt might soon exclude the US dollar and use their national currencies in the settlement of accounts in bilateral trade, Russian President Vladimir Putin said in an interview to Egyptian media ahead of his Monday visit to the country.

The issue of abandoning the dollar in trade is “being actively discussed,” Putin told Al-Ahram daily newspaper ahead of his two-day trip to Egypt. The Russian president was invited for a bilateral meeting by his Egyptian counterpart Abdul Fattah al-Sisi.

“This measure will open up new prospects for trade and investment cooperation between our countries, reduce its dependence on the current trends in the world markets,” Putin said.

“I should note that we already use national currencies for trade with a number of the CIS [Commonwealth of Independent States] states, and China. This practice proves its worth; we are ready to adopt it in our relations with Egypt as well. This issue is being discussed in substance by relevant agencies of both countries.”

Egypt is a long-time and trusted partner of Russia and the relationship between the two countries has been rapidly developing, the Russian president said.

“The volume of bilateral trade has increased significantly over the past years: In 2014, it increased by almost half compared to the previous year and amounted to more than $4.5 billion,” he said urging for this trend to be strengthened.

He also praised the development of “mutually beneficial and effective” cooperation in the sector of agriculture. “Egypt is the major buyer of Russian wheat, Russia provides about 40 percent of grain consumed in the country; as for us, we import fruits and vegetables.”



Jim Sinclair’s Commentary

The EU committed suicide by their own hand when they did not think through the economic impact on Russian sanctions of Europe itself, especially the euro.

Europe Fractures: France Pivots To Putin, Cyprus Offers Moscow Military Base, Germany-US Splinter On Ukraine
Tyler Durden on 02/08/2015 21:30 -0500

Following yesterday’s summary of the utter farce that the Minsk Summit/Ukraine “peace” deal talks have become, the various parties involved appear to be fracturing even faster today. The headlines are coming thick and fast but most prescient appears to be: DespiteJohn Kerry’s denial of any split between Germany and US over arms deliveries to Ukraine, German Foreign Minister Steinmeier slammed Washington’s strategy for being “not just risky but counterproductive.” But perhaps most significantly is France’s continued apparent pivot towards Russia… Following Francois Hollande’s calls for greater autonomy for Eastern Ukraine, former French President Nicolas Sarkozy has come out in apparent support of Russia (and specifically against the US), “we are part of a common civilization with Russia,” adding, “the interests of the Americans with the Russians are not the interests of Europe and Russia.” Even NATO appears to have given up hope of peace as Stoltenberg’s statements show little optimism and the decision by Cyprus to allow Russia to use its soil for military facilities suggests all is not at all well in the European ‘union’.

German Foreign Minister Frank-Walter Steinmeier doubled down on Germany’s rejection of weapons deliveries to Ukraine in a speech here Sunday…



“I see this, to say it openly, as not just for risky but for counter-productive,” Mr. Steinmeier said at the Munich Security Conference. Mr. Steinmeier also hit back at open criticism of Germany’s position on weapons deliveries from U.S. Senators and others here on Saturday. The White House is mulling delivering weapons to Ukraine to support the country’s fight against pro-Russia separatists in the country’s east.

“Perhaps we are so insistent because we know the region a bit,” Mr. Steinmeier said.

But John Kerry says, everything’s fine… as he denies any split between U.S. and Europe on Russia policy…

Secretary of State John Kerry on Sunday denied any divisions between the U.S. and Europe over how to handle Russia, as Germany announced another high-level summit aimed at stemming the crisis in Ukraine.



Sunset for dollar hegemony
by Bill Holter for Miles Franklin

We learned on Thursday about two very separate trips to be made on Friday.  Germany’s Angela Merkel and France’s Francois Hollande made a trek to Moscow which turned out to be a five hour meeting, while John Kerry flew into Kiev.  What were these meetings about?  Very little has been reported except

What were the goals and what was accomplished?  Presumably Mr. Kerry offered arms and assistance to Ukraine because other than “dollars”, we have nothing else to offer.  The meeting in Moscow was not so simple.  Do Germany and France see the writing on the wall?  Did they make deals with Russia regarding natural gas and the delivery logistics?  Trade?  Did they pledge to stay neutral and hope Russia did not look towards them when the real fighting begins?  Were currencies discussed?  Maybe even new ones?  Did they put distance between themselves and NATO so as to escape the Russian crosshairs?  Lots of questions and as of yet, few answers but apparently some sort of press conference for Monday and another meeting this Wednesday.   I will add one more thought, when the heads of state meet with little to no press coverage and then followed by no statement of the results with any meat on the bone whatsoever, something REALLY big was discussed!  Make no mistake, this is not about a single country, nor countries plural.  They know this is entirely about “systems” themselves and whether they can work in harmony or not work at all.

  We do know one thing for sure, Russia has mobilized her ICBM rocket launchers and will begin full scale war games.  Are these only games or are they making ready for the real thing?  I would suggest if the U.S. does in fact rearm Ukraine, these may not be “games” any more, Russia will finally retaliate.  Another possibility is that of “discovery”.  As I understand it, there are now some foreign “boots on the ground”.  Ukrainian forces are surrounded in Mariupol  , it looks like they will soon to be captured or killed.  What if it turns out some of these boots are of the type “made in USA”?  We have already seen one video clip of an American combatant in Ukraine, how many more are there?  This would be very bad and would give Mr. Putin a good and verifiable reason to escalate the shoving match into a hot war.  In my opinion, Mr. Putin will not attack unless provoked directly, I believe he will just sit back and wait.  In my opinion, he would prefer to wait until “the money runs out” which I will explain further shortly.

  On the financial side, last week was all about Greece.  First, they were given an ultimatum and a line in the sand drawn for the end of February to “accept financial aid” from the West, presumably the IMF and ECB.  On Friday, this ultimatum was fast forwarded and cut to only 10 days …or else!  They have a debt payment due at the beginning of March and do not have the money.  Simply put, they are broke.  More elegantly but no less to the point, Yanis Varoufakis, Greece’s new finance minister said of the Eurozone and I quote “A clueless political personnel, in denial of the systemic nature of the crisis, is pursuing policies akin to carpet bombing the economy of proud European nations in order to save them”.  Do you see exactly what he is saying?  This is not about Greece, it’s not even about the Eurozone, this is about the systemic failure of the West’s policies and financial system.  I want to move along but this aspect of “systemic failure” will be tomorrow’s topic and why the West cannot in any fashion call a spade a spade.

  So Greece now has an ultimatum of 10 days, accept the terms of the Eurozone …or get out.  Greece doesn’t even need to request departure, the powers that be seem to be threatening to kick them out!  Let me point out another Western financial failure and one which will be “dis connected” in the future.  Ukraine now has two, possibly three weeks worth of cash left.  They also owe Russia several billion dollars for gas already delivered and used.  Mr. Putin knows this and as I said earlier, is just sitting back and waiting for the money to run out …or for them to “accept” aide from the West.  Both of these NATO countries are broke and unfortunately at the same time which obviously turns up the heat further in rather inconvenient fashion.

  Just so you didn’t miss my pun above, Russia is clearly “disconnecting” Ukraine.  Russia has already begun very seriously to divert gas shipments that were going through the Ukraine.  Russia was not being paid and some of her gas to Europe was being stolen, thus, turn off the spigot.  Geopolitically, Russia has already made a pipeline deal with Turkey which will end …you guessed it, at the Greek border!  Think this one through, Russia has already offered assistance to Greece …while Greece is being pressured by Europe to go further into debt.  Don’t you think it might be in Greece’s best interest to “do a deal” with Russia?

  What might any deal look like with Russia and thus out from under the Eurozone and NATO?  How about “connecting” to the Turkish pipeline for starters and running it through Greece to arrive in eastern Europe?  The Russians (Chinese) could finance the deal, Greece would then earn gas transit cash flows.  A pipeline would also create jobs and economic activity.  Greece would also be free to trade with Russia, their farmers could ship crops to Russia without being under the current ridiculous embargos and sanctions, again good for the Greek economy!  One last benefit might be “debt relief”.  Not that the West will forgive what the Greeks owe (because they cannot, I’ll include this in tomorrow’s piece), the Greeks can simply say “we are not paying you” …



7 Terrifying Warnings That The Greek Disaster Is Now Set To Catapult The World Into A Global Meltdown
February 09, 2015

Today Greece has rejected bailouts ahead of the emergency meetings, Alan Greenspan has now predicted the collapse of the euro and the Greek Finance Minister has also warned that the euro will collapse if Greece exits! With that chaotic backdrop, below are 7 terrifying warnings that the Greek disaster is now set to catapult the world into a global meltdown.  These 7 crucial warnings all indicate that this crisis now has world heading toward a catastrophic outcome.

Below are the 7 terrifying warnings that the Greek disaster is now set to cataput the world into a global meltdown:

Paul Craig Roberts warned King World News that the Greek cisis is a game-changer for the entire world:



Jim Sinclair’s Commentary

The banking industry will not like this.

Tsipras favours Greek jobless over creditors in defiant policy speech
Prime minister says government’s first priority is to tackle humanitarian crisis caused by years of austerity
Helena Smith in Athens
Sunday 8 February 2015 14.30 EST

The Greek prime minister, Alexis Tsipras, has announced his anti-austerity government programme in a defiant address that prioritised the jobless and destitute over international creditors who have lent the country more than $300bn (£200bn).

In his first policy speech before parliament, he said his government did not have the right to prolong the five-year bailout deal that has foisted austerity on Greece, and felt a duty “not to disappoint” those who had voted him into power.

“We see hope, dignity and pride returning to Greek citizens. Our obligation and duty is not to disappoint them,” he told the 300-seat house. “We realise that negotiations [with foreign lenders] won’t be easy … but we have faith in our struggle, because justice is on our side.”

Declaring his administration “a government of national salvation”, Tsipras said he would also pursue claims to win back from Germany wartime loans that Greece had been forced to make to Nazi occupiers. “I can’t overlook what is an ethical duty, a duty to history … to lay claim to the wartime debt.”

Tsipras did signal a new round of belt-tightening – but on the part of ministers and MPs. He promised to sell half of all government limousines and a government jet in a money-raising exercise, as well as trimming back on security. Tsipras said Greece’s new class of politician would set the example of frugal living. “We do not need three government aircraft. Politicians can do away with the privilege of having a car,” he said.



The Death Of The Petrodollar Was Finally Noticed
Submitted by Tyler Durden on 02/07/2015 23:29 -0500

Three months ago, we wrote “How The Petrodollar Quietly Died, And Nobody Noticed”, in which we explained in painful detail why far from the simple macroeconomic dogma which immediately prompted the macro tourists to scream that “oil prices dropping are good for US consumers”, the collapse in the price of crude is not only a disaster for oil exporting nations – one which will lead to a series of violent “Arab Springs” across the oil-producing developed world – but far more importantly, have a massive impact on capital markets as a result of the plunge in the most financialized commodity in history.

On the death of the Petrodollar we commented that unlike previously, when petrodollar recycling funneled the proceeds from oil-exports into financial markets, helping to boost asset prices and keep the cost of borrowing down, henceforth “oil producers will effectively import capital amounting to $7.6 billion.” We added that “oil exporters are now pulling liquidity out of financial markets rather than putting money in. That could result in higher borrowing costs for governments, companies, and ultimately, consumers as money becomes scarcer.”

The conclusion was simple: “net capital flows will be negative for EM, representing the first net inflow of capital (USD8bn) for the first time in eighteen years. This compares with USD60bn last year, which itself was down from USD248bn in 2012. At its peak, recycled EM petro dollars amounted to USD511bn back in 2006. The declines seen since 2006 not only reflect the changed  global environment, but also the propensity of underlying exporters to begin investing the money domestically rather than save. The implications for financial markets liquidity – not to mention related downward pressure on US Treasury yields – is negative.”

In retrospect, it probably was not “simple enough”, because even three months ago everyone was confident that both higher yields and an increase in market liquidity are imminent. Since then not only has the yield on the 10 Year plunged to near record low levels (while 16% of global government debt now trades at negative yields), but judging by the absolute liquidity devastation in the E-Mini, in Treasurys and virtually every other asset class, few actually grasped the implications of what plunging oil really means in a world in which this most financialized of commodities plays a massive role in both the global economy and capital markets, not to mention in geopolitics, with implications far, far greater than the amateurish “yes, but gas is now cheaper” retort.





Fearing Grexit, Greeks Turn To Gold Again
Submitted by Tyler Durden on 02/09/2015 13:05 -0500

It never fails: every time redenomination risks and the specter of the (New) Drachma rear its ugly heads, Greeks, like dutiful Austrian economists, realize that Neoliberal economics is nothing but a steaming pile of drivel that only works when everyone is “confident” and gets deeper in debt with a smile on their face while failing in every other instance, and decide that the time has come to convert their paper wealth into hard assets. It happened in 2010, in 2012, and now that Greece is on the verge of its third Grexit in the past 5 years, it is happening again.

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

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

They said that with a straight face because in Greece “times of political and financial uncertainty” are now a monthly if not quarterly development. As a result, Greek investors are turning to gold. The Royal Mint declined to provide exact sales figures for the gold coins, known as Sovereigns.

Domestically, the Greek gold demand is currently run-rating at more than double that of Q4 2014: the Bank of Greece sold 5,849 Sovereign coins in January, according to an e-mail from the central bank. Bloomberg cites government data which show sales of 7,857 coins in the last quarter of 2014.

Why gold?  “The one thing everyone knows about gold is it is a good thing to hold if your currency is about to devalue,” Matthew Turner, an analyst at Macquarie Bank Ltd., said via phone. “It would be understandable for Greeks to buy gold because they are afraid of losing their money.”


Yellen, We Have A Problem
Submitted by Tyler Durden on 02/09/2015 15:48 -0500

Just three things to consider: “The Fed doesn’t matter?” – so just ignore the correlation between Federal Reserve balance sheet expansion (flow) and S&P 500 performance tumbling lower. “Earnings don’t matter?” – because for now, stocks are entirely ignoring the three-month plunge in consensus EPS expectations. “Macro fundamentals don’t matter?” – because if they did, US equity prices would be collapsing. Trade accordingly…

It’s the flow, stupid…


It’s the earnings, stupid…




Hooded gunmen fire on police in Marseille
DEBKAfile February 9, 2015, 1:13 PM (IDT)

Heavily armed French elite police forces poured into the scene after hooded gunmen fired on police in Marseille Monday when Prime Minister Manuel Valls was on his way to visit the southern French city. They have cordoned off the area. Unconfirmed sources say that the head of police was shot at by one of the Kalashnikov-armed men. The attack took place in a high-crime, low-cost housing district of Marseille. The town is known both for its large North African community and gang wars. Islamist radicals and criminal gangs often join forces in its tense ghetto neighborhoods. There is no initial word on casualties. Developing…



Jim Sinclair’s Commentary

This could be the Black Swan of all Black Swans when it comes to weak EU partners bond markets.

Greek Contagion? Spanish/Italian Bond Risk Surge Most In 4 Months
Tyler Durden on 02/09/2015 11:20 -0500

With Spanish and Italian leaders desperately running around to any and every media outlet to proclaim themselves economically fit and deny deny deny what Greek FinMin Varoufakis said yesterday, it appears the market has a different perspective. Portuguese bond spreads are 16bps wider and Spanish and Italian bond spreads are 12bps wider – their worst day in almost 4 months – as it appears Grexit fears are starting to creep into the rest of the periphery.


Charts: Bloomberg



Jim Sinclair’s Commentary

Sanction blowback will change the geography of wealth.

China and Russia-led Eurasian Economic Union may set up free trade zone
Published time: February 09, 2015 15:55

China may establish a free trade zone with the Eurasian Economic Union (EEU) in the future, says the Russian Ambassador to China Andrey Denisov. It would make trade with Russia, Belarus, Kazakhstan, Armenia, and soon Kyrgyzstan tariff-free.

“At first the Chinese were cautious about the Eurasian Trade Union; they just needed to make sure that it works. Now they are increasingly showing interest in participation with the union, not just with Kazakhstan, Belarus, Russia, Armenia, and Kyrgyzstan on an individual basis, but with the union per se,” Denisov told RIA in an interview published on Monday.

As far as I know they [the Chinese – Ed.] offered us, the members of this Union –EEU – to think long-term about the creation of a free trade zone. Well, this is probably the case, even if it’s far off in the future.

The Eurasian Economic Union includes Russia, Armenia, Belarus and Kazakhstan and was officially launched on January 1. Kyrgyzstan has said it will join, with accession expected by the end of May.



Jim Sinclair’s Commentary

Good work on gold history. Long but worth your time.

Second Thoughts On US Official Gold Reserves Audits
BullionStar Blogs
Posted on 9 Feb 2015 by Koos Jansen

This post is a sequel to “A First Glance At US Official Gold Reserves Audits”.

What is not often covered in the media or blogosphere are the audits of the US official gold reserves stored at the US Mint, which is the custodian for 95 % (7716 tonnes) of the stash – also referred to as deep storage, and at the Federal Reserve Bank Of New York that safeguards the remaining 5 % (418 tonnes). The lawful owner of the US official gold reserves is the US Treasury. Part one covered the most recent records I could find published by the US government, in this post we’ll examine more historical records and approach this matter from a more critical angle. Because of the amount of information I found this post is split in multiple parts.

What Is A Gold Audit?

From Wikipedia:

Auditing is defined as a systematic and independent examination of data, statements, records, operations and performances (financial or otherwise) of an enterprise for a stated purpose. In any auditing the auditor perceives and recognizes the propositions before him for examination, collects evidence, evaluates the same and on this basis formulates his judgment, which is communicated through his audit report.

Due to constraints, an audit seeks to provide only reasonable assurance that the statements are free from material error. Hence, statistical sampling is often adopted in audits.

To be sure, I’ve asked several bullion dealers about how their audits are being conducted. They all agreed an audit involves three parties: the owner of the gold, the custodian and an external (independent) auditor. The external auditor examines the gold, compares its findings with the statements of the custodian and then reports on the accuracy of the statements of the custodian to the owner of the gold. An example of an audit report by such an external auditor can be found here.

The fact that the auditor is an external party is essential; if the custodian itself would perform the audit it could easily falsify the reports and lend gold that isn’t often transferred in and out of the vaults.

What Is A Gold Assay?

Assaying gold is done to test the purity of the metal; to make sure a bar contains at least the amount of fine gold disclosed on its inscription. For assay tests often samples are taken from random bars (not from all bars of a specific inventory). From Wikipedia:

A metallurgical assay is a compositional analysis of an ore, metal, or alloy. Raw precious metals (bullion) are assayed by an assay office. Silver is assayed by titration, gold by cupellation and platinum by inductively coupled plasma optical emission spectrometry.



Jim Sinclair’s Commentary

Greece could start a flock of Black Swans.

Ireland ‘will insist on similar deal’ if any secured by Greece
Mon, Feb 9, 2015, 10:06

Coveney says same rules must apply to Greece as to all other European Union countries

Pamela Newenham, Suzanne Lynch

Ireland will insist that any new or better deal secured by Greece will also apply to Ireland, Minister for Agriculture Simon Coveney has said.

Greek prime minister Alexis Tsipras yesterday ruled out requesting an extension of the Greek bailout when meeting his European counterparts at a summit in Brussels this week.

Rather than an extension of the bailout when it expires on February 28th, Mr Tsipras reiterated his demand for a bridge programme to tide the country over until June, when a more long-standing loan arrangement can be established.

He expressed confidence that agreement could be reached between Greece and its international lenders.

Mr Coveney said the same rules must apply to Greece as to all other European Union countries.

“What we would encourage Greece to do is exactly what Ireland has done. Which is to restructure and change the way that their debt is to be repaid so they can reduce that debt burden,” Mr Coveney said.


Posted at 4:43 PM (CST) by & filed under Jim's Mailbox.


China does this in Africa, Russia in the East and together in South and Central America.

CIGA Richard

Russia sees possibilities to implement energy, transport projects with Seoul, Pyongyang
February 09, 12:59 UTC+3

MOSCOW, February 9. /TASS/. Joint projects between Moscow, Seoul and Pyongyang, including the development of rail, gas and electric power infrastructure, will benefit Russia, South and North Korea and strengthen peace on the Korean peninsula, Russia’s ambassador to Seoul Alexander Timonin said on Monday.

“The implementation of three-partite economic projects with the participation of our country, South Korea and North Korea can open broad prospects for the development of mutually advantageous cooperation,” the Russian ambassador said.

“The connection of the TransSib [trans-Siberian railway] and the trans-Korean railroad, the laying of a gas pipeline and the construction of electricity transmission lines connecting Russia and both Koreas can bring economic dividends for project participants and contribute to strengthening peace and stability on the peninsula. Both Pyongyang and Seoul generally agree with this approach,” he said.

Work on implementing some of these projects is already under way, the Russian ambassador to Seoul said.