Posted at 5:13 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

In case you haven’t checked it out in a while. http://www.usdebtclock.org/

Jim Sinclair’s Commentary

Every step forward for the Yuan is a long term backwards for the dollar.

Yuan to Start Direct Trading With Euro as China Pushes Usage
By Bloomberg News Sep 29, 2014 5:06 AM MT

China will start direct trading between the yuan and the euro tomorrow as the world’s second-largest economy seeks to spur global use of its currency.

The move will lower transaction costs and so make yuan and euros more attractive to conduct bilateral trade and investment, the People’s Bank of China said today in a statement on its website. HSBC Holdings Plc said separately it has received regulatory approval to be one of the first market makers when trading begins in China’s domestic market.

The euro will become the sixth major currency to be exchangeable directly for yuan in Shanghai, joining the U.S., Australian and New Zealand dollars, the British pound and the Japanese yen. The yuan ranked seventh for global payments in August and more than one-third of the world’s financial institutions have used it for transfers to China and Hong Kong, the Society for Worldwide International Financial Telecommunications said last week.

“It’s a fresh step forward in China’s yuan internationalization,” said Liu Dongliang, an analyst with China Merchants Bank Co. in Shenzhen. “However, the real impact on foreign exchange rates and companies may be limited as onshore trading volumes between yuan and non-dollars are still too small to gain real pricing power.”

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Jim Sinclair’s Commentary

Nice to see a more accurate report on the size of the OTC derivative pile.

The Economy: “Derivatives Market a $1.2 Quadrillion Time Bomb”
Sunday, October 14, 2012 22:40
by The Independent Report

“The US economy is run like a casino and Wall St. is the house. Collateralized debt obligations (CDOs), credit default swaps (CDS) and derivatives are Wall Street’s casino games. Naturally, the games are always rigged in favor of the house.

Financial jargon is often arcane and perplexing to the average person. While even casual observers have surely heard of derivatives, most are unlikely to know what exactly they are. Derivatives, or swaps, are basically bets between companies and banks that are designed, in essence, to be insurance policies. The problem with derivatives is that since they often involve highly leveraged bets, they can be very dangerous. A small change in market conditions can mean huge losses. Such losses can occur because derivatives use extraordinary leverage, or borrowing. Derivatives allow investors to earn large returns from small movements in the underlying asset’s price. However, investors can also lose large amounts if the price of the underlying asset moves against them significantly.

In fact, derivatives were used to conceal credit risk from third parties while protecting derivative counterparties, which contributed to the financial crisis in 2008. That threat still lingers today. If interest rates were to rise unexpectedly, for example, it could result in a financial bloodbath on Wall Street.

Derivatives are used to make the really big money on Wall St. They can be many things, but are basically contracts or bets that derive their value from the performance of something else — an interest rate, a bond or stock, a loan, a currency, a commodity, virtually anything. For traders, derivatives are a perfect product. They can also be highly lucrative to financial institutions. Over the last five years, banks earned an estimated $20 billion selling derivatives just to school districts, hospitals, and scores of state and local governments across the country. Yet, as Warren Buffett famously stated, derivatives are “financial weapons of mass destruction.”

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Pending Home Sales Drop In August (After Record Surge In New Home Sales)
Tyler Durden on 09/29/2014 10:10 -0400

Following last week’s explosion higher in new home sales (despite surging record high prices), it is somewhat intriguing that pending home sales would tumble over 4.1% YoY, and drop 1.0% MoM (missing expectations of a 0.5% drop) and the 2nd biggest drop in 2014.

The ‘stunning’ rationale for this miss, provided by NAR’s chief economist, is… "fewer bargain-priced homes’ (which is odd given record prices and record surge in new home sales), and a "rising rate environment" (except rates are collapsing), with hope for the future based on the "employment outlook for young adults improving and their incomes rising" (more lies) and a "shift to more traditional first-time buyers who need mortgages" (except mortage apps are at 20-year lows).

Just last week, New home sales rose the most since 1992:

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Jim Sinclair’s Commentary

The age of Miracles is not over.

Despite 2nd Slowest Income Growth In 2014, Spending Rises Most Since March Driven By Subprime, Car Sales
Submitted by Tyler Durden on 09/29/2014 08:38 -0400

Mission releverage accomplished. Personal Income rose 0.3% in August (very slightly below Bloomberg’s median estimate), the 2nd slowest growth of the year.Personal spending however jumped 0.5%, beating the 0.4% expectations, and its equal best growth since March. What was spending focused on? Why autosales, which accounted for about half of the spending. And what funded this spending? Why subprime car loans of course; it sure wasn’t the real disposable income per capita which was a paltry $37,684 in August.

This is how the income and spending looked like:

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2nd miss in a row and 2nd lowest growth in income this year.

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But spending jumped (thank you Subprime bubble 2.0)

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Finally, following several revisions and even more months of constant increases in the US savings rate, August finally saw a drop, from 5.6% to 5.4%, just as Goldman hinted to the Department of Commerce should happen late last week.

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White House Intruder Got Farther Than First Reported, Official Says
By MICHAEL D. SHEARSEPT. 29, 2014

WASHINGTON — An armed man who jumped the White House fence this month made it far deeper into the president’s home than previously disclosed, overpowering a Secret Service agent inside the North Portico entrance and running through the East Room before he was tackled, according to a congressional official familiar with the details of the incident.

The man, Omar J. Gonzalez, who had a knife, was finally stopped as he tried to enter the Green Room, the official said. Earlier, Secret Service officials had said Mr. Gonzalez, 42, had only made it steps inside the North Portico after running through the front door.

The new development, first reported by The Washington Post, will create an explosive hearing on Tuesday when a bipartisan panel of lawmakers intends to grill Julia Pierson, the director of the Secret Service, about whether a lax and undisciplined culture inside the long-heralded agency has badly eroded its ability to protect the president and his family, several members of Congress said Monday.

It has been unheard of in recent decades for an intruder to enter the White House, even if only a few steps inside what is supposed to be one of the most secure buildings in the world. The fact that Mr. Gonzalez was able to pass by the staircase in the Entrance Hall that leads to the White House family quarters — and get as far as the East Room, the site of presidential speeches, news conferences and bill signings — stunned Washington.

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Jim Sinclair’s Commentary

China never slowed down their buying of gold.

China gold demand surging again
Author: Lawrence Williams|
29 September 2014 13:3

Shanghai Gold Exchange figures suggest demand is near 2013 levels.

LONDON (MINEWEB) – We cannot emphasise more strongly that gold followers should ignore the mainstream media reports, based on Hong Kong gold export figures to mainland China, that Chinese gold demand has plummeted by anything between 30% and 50% this year. As we pointed out in an article last week, Hong Kong is now no longer the principal port of entry for gold into the Chinese mainland.

When it was still so, gold exports into China were extremely high at the beginning of the year, but since then the Hong Kong figures have tailed off as China effectively opened up gold import routes through other entry points – notably Shanghai and Beijing , resulting in the Hong Kong net gold exports falling back month by month from a peak of 111 tonnes in February to a mere 21 tonnes in August. This is thus no longer an indicator of overall Chinese gold demand.

That this does not represent the overall Chinese picture is apparent from the withdrawals of physical gold from the Shanghai Gold Exchange (SGE). True these withdrawals are also down this year suggesting a more gradual slowdown in Chinese demand, NOT a precipitous fall as suggested by the mainstream media. However, recently SGE gold withdrawal figures have been particularly strong again – a fact apparently ignored by most gold commentators.

Indeed the past four weeks’ withdrawals from the SGE have totalled over 170 tonnes – this suggests an annual rate of over 2,200 tonnes although weaker figures from March up until August will mean this level will not be reached for the 2014 calendar year, but it may well get much closer to last year’s 2,197 tonnes withdrawn from the SGE than previously estimated.

We would suggest that this year’s figure may well get close to 2,000 tonnes given the lower gold price has been stimulating demand at a time of year when it is traditionally strong anyway. We can thus anticipate continuing demand at high levels and China maintaining its place as the world’s largest gold importer – even disregarding the assumed-probable additional gold imports to swell the country’s gold reserves.

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Posted at 4:17 PM (CST) by & filed under Jim's Mailbox.

Jim,

What David speaks of here is the fact that Mario Draghi sometime back said, he would do whatever it takes to make things happen. What does he do, but offers very low interest loans for around $1Million intended for the small to medium companies for the purchase new plants and equipment. The problem is he is getting few takers for these loans and there is little growth happening. The hedge funds are going out and buying government debt with the expectation that the next round from Draghi when he makes good on his statement that he would do whatever it takes, will include the buying of Government debt. This expectation by the banksters that they could make people behave in one way when there are other choices is the big downfall of the banksters and central planners.

CIGA Larry

Peak Debt—-Why The Keynesian Money Printers Are Done
by David Stockman • September 28, 2014

Bloomberg has a story today on the faltering of Draghi’s latest scheme to levitate Europe’s somnolent socialist economies by means of a new round of monetary juice called TLTRO—–$1.3 trillion in essentially zero cost four-year funding to European banks on the condition that they expand their business loan books. Using anecdotes from Spain, the piece perhaps inadvertently highlights all that is wrong with the entire central bank money printing regime that is now extirpating honest finance nearly everywhere in the world.

On the one hand, the initial round of TLTRO takedowns came in at only $100 billion compared to the $200 billion widely expected. It seems that Spanish banks, like their counterparts elsewhere in Europe, are finding virtually no demand among small and medium businesses for new loans.

Many small and medium-sized businesses are wary of the offers from banks as European Central Bank President Draghi prepares to pump more cash into the financial system to boost prices and spur growth. The reticence in Spain suggests demand for credit may be as much of a problem as the supply.

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Posted at 5:57 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

The latest from John Williams’ www.ShadowStats.com.

- GDP Has Fully Reestablished Itself as the Most Worthless of Economic Series 
- Fluff and Guesstimates Dominated the Upside GDP Revision 
- Monthly Economic Reporting Should Turn Increasingly Negative

"No. 662: Second-Quarter 2014 GDP — Third Estimate" 
Web-page: http://www.shadowstats.com

 

Secret tapes of Fed meetings on Goldman prompt call for U.S. hearings
By Jonathan Spicer and Emily Stephenson
NEW YORK/WASHINGTON Fri Sep 26, 2014 6:18pm EDT

(Reuters) – An influential U.S. senator wants to hold hearings into "disturbing" issues raised by secretly taped conversations between Federal Reserve supervisors and officials at Goldman Sachs Group Inc (GS.N), a bank the Fed was tasked with policing.

Elizabeth Warren, a Democrat on the Senate Banking Committee, on Friday called for hearings after portions of the recordings from 2011 and 2012 were made public. Fellow Democrat Sherrod Brown, also a committee member, called for a "full and thorough investigation" into the allegations they raised.

Carmen Segarra, a former New York Fed bank examiner who brought a wrongful termination lawsuit against her former employer, recorded the conversations and provided them to the investigative news outlet ProPublica and the public radio show "This American Life" to illustrate what she saw as an inappropriately close relationship between regulator and bank.

The tapes appear to show an unwillingness among some Fed supervisors to both demand specific information from Goldman about a transaction with Banco Santander and to strongly criticize what Segarra concluded was the lack of an appropriate conflict-of-interest policy at Goldman.

Political interest in the recordings could feed suspicion among Americans that little has changed on Wall Street since bank regulators failed to identify and stop the risk-taking that led to the 2007-2009 financial crisis and deep U.S. recession.

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Posted at 1:52 PM (CST) by & filed under In The News.

The American House of Cards continues to stand only as a result of the tolerance of the world for vast corruption and disinformation and because greed is satisfied by the money made from a rigged system.
–Dr. Paul Craig Roberts

Jim Sinclair’s Commentary

Sanctions makes new partners and friends.

‘China won’t support sanctions against Moscow’
Published time: September 23, 2014 12:41

China will never support any sanctions against Russia and will never join them, Valentina Matviyenko, speaker of the Russian parliament’s upper house said, citing Chinese President Xi Jinping, with whom she met on Tuesday.

Both Russia and China believe the sanctions are illegal, ineffective and counterproductive, according to Matviyenko. They are nothing but an attempt “to exert pressure on sovereign states to change their position and to weaken them and suppress their development,” she stressed.

Matviyenko thanked Beijing for its public position towards Western sanctions imposed on Russia over the Ukrainian conflict. China has offered an “absolutely objective” assessment of what is now going on in Ukraine. Moreover, no sanctions will affect the long-term strategic partnership between Moscow and Beijing, which reflects the interests of both peoples, she noted.

Cooperation of Russia and China remains a serious factor in international politics, Matviyenko said, adding that the two states have no disputable issues. Their positions are either close or coincide on major problems, including how to settle international and regional conflicts or deal with new challenges and threats.

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Jim Sinclair’s Commentary

Statistical skullduggery.

Final Q2 GDP Surges 4.6% Thanks To Profit Definition Change; Personal Consumption Weaker Than Expected
Submitted by Tyler Durden on 09/26/2014 09:08 -0400

The good news in the just released final Q2 GDP estimate soared by 4.6%, just as Wall Street expected, which was the biggest quarterly jump since 2011 Q4 2011, driven by gains in business spending, where mandatory forced Obamacare outlays led to a $17.5 billion chained-dollars increase in Healthcare spending to $1815.9 billion. Nonresidential fixed investment contributed two-tenths to the revision, net exports contributed one-tenth, and consumer spending contributed one-tenth. Also helping were corporate profits which rose 8.4% in Q2, the most since Q3 2010, once again courtesy of adjustment in definitions (recall the IVA vs CCAdj change we discussed previously).

From the report: "Profits from current production (corporate profits with inventory valuation adjustment (IVA) and capital consumption adjustment (CCAdj)) increased $164.1 billion in the second quarter, in contrast to a decrease of $201.7 billion in the first." For the explanation read "Is This The Top? First Quarter Corporate Profits Tumble Most Since Lehman." The definition change was responsible for a drop in Q1 profits which has now shot right back up. This is what Goldman said back then:

The decline was driven by statistical adjustment factors. The first reason is that the decline in corporate profits as measured in the national accounts mostly reflects the capital consumption adjustment factor estimated by the BEA to account for the effect of the expiration of bonus depreciation at the end of 2013.

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Tapes showing meek oversight of Goldman are about to rock Wall Street

Wall Street is about to be rocked by secretly recorded audio tapes that purport to show a too-cozy relationship between the New York Federal Reserve Bank and the financial institutions it is supposed to regulate.

The 45 hours of tapes, made by Carmen Segarra, a former NY Fed worker, capture former co-workers, whose job was to keep banks like Goldman Sachs in line, instead deferring to the banks, being unwilling to take action and being extremely passive, according to NPR’s “This American Life,” and ProPublica which obtained the tapes and is scheduled to air a program about the matter Friday night.

Segarra, ironically, was hired by the NY Fed in October 2011 to help toughen up their oversight. She was fired in 2013 after, she claims in a lawsuit, she tried to get Goldman to toe the line on regulations.

The NY Fed has regulators embedded at each of the large banks it oversees. On her first day on the job, Segarra was assigned to Goldman.

The pushback from Goldman started right away. At one of her first meetings, a senior compliance officer at Goldman said certain consumer laws didn’t apply to the bank’s wealthier clients.

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Rick Rule: I Think We Are Seeing A Bullish Transition In The Junior Gold Miners
By: Tekoa Da Silva, 9/26/2014

Full Transcript:

During a time in which few investors are considering the possibility of a recovery in natural resources, Rick Rule, Chairman of Sprott U.S. Holdings was kind enough to share a few comments.

Speaking towards the overall market Rick noted that, “The market itself is very healthy. You are seeing a transition…a transition that doesn’t suggest, but rather screams that [junior resource issues are] under accumulation—which is a very, very bullish sign.”

When asked if the current recovery might outperform the early 2000’s recovery, Rick indicated that, “[S]tatistically, this market shows it can be done because the bear market that preceded this bull market was a bear market that was more severe… bear markets are the authors of bull markets, and the recoveries in some way, shape, or form are related to the declines.”

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

Tekoa Da Silva: Rick, we had a meeting at our offices here recently, in which all our brokers, money managers, geologists, sat down around a table for what was a fascinating discussion on the resource markets.

You commented at one point during that meeting that we’re beginning to see a stair step formation building in the charts of the resource market; a series of higher highs and higher lows, suggesting a move of paper from weak hands to strong. Can you talk about that for our readers?

Rick Rule: Sure. I’m not a technical analyst but I have some friends who I think are fairly adept at this, [so I’ll say that], the chart pattern we’re seeing in the junior mining market in particular (but in the precious metals markets as well) is sort of a saucer-shaped recovery that is a slow, gradual recovery featuring higher highs and higher lows.

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Tapes showing meek oversight of Goldman are about to rock Wall Street
By Post Staff Report
September 26, 2014 | 10:51am

Wall Street is about to be rocked by secretly recorded audio tapes that purport to show a too-cozy relationship between the New York Federal Reserve Bank and the financial institutions it is supposed to regulate.

The 45 hours of tapes, made by Carmen Segarra, a former NY Fed worker, capture former co-workers, whose job was to keep banks like Goldman Sachs in line, instead deferring to the banks, being unwilling to take action and being extremely passive, according to NPR’s “This American Life,” and ProPublica which obtained the tapes and is scheduled to air a program about the matter Friday night.

Segarra, ironically, was hired by the NY Fed in October 2011 to help toughen up their oversight. She was fired in 2013 after, she claims in a lawsuit, she tried to get Goldman to toe the line on regulations.

The NY Fed has regulators embedded at each of the large banks it oversees. On her first day on the job, Segarra was assigned to Goldman.

The pushback from Goldman started right away. At one of her first meetings, a senior compliance officer at Goldman said certain consumer laws didn’t apply to the bank’s wealthier clients.

“I was shocked,” Segarra tells a reporter for the NPR show, adding that her notes on the meeting had that exact line.

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Posted at 8:36 AM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

The latest from John Williams’ www.ShadowStats.com.

- A "False Dawn" It Is
- Hyperinflation Forecast Remains in Play
- Stock Crashes versus October Residual-Squirrelling Instincts
- Durable Goods Orders Crashed 18.0% (-18.0%), Reversing July’s 22.2% Surge, Dominated Again by Irregular Commercial-Aircraft Orders
- Down for the Month, August Existing-Home Sales Were in Tenth Month of Annual Decline
- August New-Home Sales Surge of 18.0% Was Statistically-Insignificant

"No. 661: "False Dawn," Hyperinflation, Durable Goods Orders, Home Sales"
Web-page: http://www.shadowstats.com

 

Attorney General Eric Holder, Prominent Liberal Voice in Obama Administration, Is Resigning
By MATT APUZZO and MICHAEL D. SHEARSEPT. 25, 2014

WASHINGTON — Attorney General Eric H. Holder Jr. is resigning, the Justice Department said Thursday, but plans to remain in office until a successor is confirmed.

Mr. Holder, the 82nd attorney general and the first African-American to serve in that position, had previously said he planned to leave office by the end of this year.

Particularly in President Obama’s second term, Mr. Holder has been the most prominent liberal voice of the administration, leading its push for same-sex marriage and voting rights.

After the recent shooting of an unarmed black teenager by a white police officer, Mr. Holder volunteered to go to Ferguson, Mo., as the administration’s emissary.

Nobody else in the administration, Obama included, has done nearly as much to protect and support the rights of African Americans.

A senior White House official said the president was “a long way” from announcing Mr. Holder’s replacement. Frequently mentioned candidates for the job include: Kathryn Ruemmler, the former White House counsel; Gov. Deval Patrick of Massachusetts; Solicitor General Donald B. Verrilli Jr.; former Gov. Jennifer M. Granholm of Michigan; Senator Sheldon Whitehouse, Democrat of Rhode Island; and Loretta E. Lynch, the United States attorney in Brooklyn.

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Russian draft law would allow seizure of foreign property
By Alexei Anishchuk

MOSCOW (Reuters) – Russian courts could get the green light to seize foreign assets on Russian territory under a draft law intended as a response to Western sanctions over the Ukraine crisis.

The draft, which was submitted to parliament on Wednesday by a pro-Kremlin deputy, would also allow state compensation for an individual whose property is seized in foreign jurisdictions.

Italian authorities this week seized property worth about 30 million euros ($40 million) belonging to companies controlled by Arkady Rotenberg, an ally of President Vladimir Putin targeted by the U.S. and European Union sanctions.

The draft law, published on a parliamentary database, would allow for compensation for Russian citizens who suffer because of an "unlawful court act" in a foreign jurisdiction and clear the way to foreign state assets in Russia being seized, even if they are subject to international immunity.

Boris Nemtsov, a Kremlin critic who in the late 1990s was a senior member of government, said the bill was an attempt by Putin to shield Russian billionaires and officials from the impact of sanctions.

"What is a strongman’s friendship like?" he asked rhetorically on his Facebook page. "It is when your four villas, apartment and hotel are seized in Italy, and your accomplice in the Kremlin immediately introduces a bill to compensate for the losses from the Russian budget."

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Jim Sinclair’s Commentary

Sanctions will be ignored after the first frost in Europe.

U.K. Seeks to Criminalize Manipulation of 7 Benchmarks
By Gavin Finch and Nicholas Larkin
September 25, 2014 4:53 AM EDT

“The integrity of the City matters to the economy of Britain,” Economic Secretary to the Treasury Andrea Leadsom said in the statement.

The U.K. government plans to criminalize the manipulation of seven more benchmarks in markets from foreign exchange to gold and oil as it tries to revive confidence in the integrity of London as a financial center.

The Treasury today started a review into whether it should extend legislation regulating the London Interbank Offered Rate to cover other key rates including the WM/Reuters 4 p.m. London currency fix, the Sterling Overnight Index Average, the London gold fixing and the ISDAFix, according to a statement. The government aims to have the rules in place by the year-end — five months before the next general election.

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Jim Sinclair’s Commentary

Gold consumption in India is a part of the Indian culture and tradition.

50 tonne gold smuggled into India in 10 days, 30% reached Mumbai
Manish Pachouly, Hindustan Times Mumbai, September 23, 2014
First Published: 22:01 IST(23/9/2014) | Last Updated: 22:05 IST(23/9/2014)

About 50 tonne gold has been smuggled into the country in the past 10 days, and subsequently pushed into the market to cater to a surge in demand for the precious metal in the festive season. There is a heavy demand for gold during Dussehra, for which booking and supply will start from Thursday, when shradh ends and Navratri starts.

Market sources said that 30% of the smuggled gold has been supplied in Mumbai to unscrupulous jewellers, while the rest was distributed to different parts of the country.

Sources said that illegal gold is finding a place in the market because of below average import resulting from the 80:20 scheme and 10% import duty. Against the average monthly demand of 80 tonne, the import is presently around 51 tonne in the country.

Sources said that gold was smuggled into the country through the land route, via Nepal, Bhutan, Bangladesh and Pakistan. “This is because airports have tightened security, restricting the smuggling of gold by the air route,” said a market expert. The Mumbai airport customs, which has started a serious crackdown on gold smugglers, has seized around 529 kg gold from April to August this financial year.

Experts fear that more gold will be smuggled from similar land routes in days to come, as the demand will shoot up once the marriage season begins, in the later part of November. “There will be huge demand because of the festive season, and also the low price at which gold is presently being traded,” said Kumar Jain, vice-president of Mumbai Jewellers’ Association.

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U.S. durable-goods orders sink record 18.2% in August on fewer jet contracts
Published: Sept 25, 2014 8:30 a.m. ET
By JeffryBartash

WASHINGTON (MarketWatch) – Orders for durable U.S. goods plunged by a record 18.2% in August after a record 22.5% gain in July, mainly because of up-and-down demand for airplanes. Orders rose by 0.7% if the volatile transportation sector is stripped out and business investment also increased, government data showed, a sign that companies continue to spend at a moderate pace. Economists surveyed by MarketWatch had expected orders to fall by a seasonally adjusted 17.3%. Orders for core capital goods – a broader measure of business investment – climbed by 0.6% in August, the Commerce Department said Thursday. Shipments of core capital goods, a category used to calculate quarterly economic growth, edged up by 0.1% and rose for the fourth straight month.

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Jim Sinclair’s Commentary

It seems unlikely in our world but maybe.

Britain eyes Libor abuse powers for oil, gold markets
Sep. 25, 2014, 3:48 AM

A statement from the Treasury said the government wished to extend the legislation to the London Gold Fixing and the LMBA Silver Price

London (AFP) – Britain on Thursday said new powers to punish rigging of Libor interest rates with criminal sanctions should be extended for seven major benchmarks, drawing in oil, gold and currency markets.

"The government has today launched a consultation on extending the new legislation the government put in place to regulate Libor to cover further benchmarks in the foreign exchange, fixed income and commodity markets," said a statement from the Treasury.

The government said it wished to extend the legislation to the London Gold Fixing and the LMBA Silver Price, which determine the price of gold and silver in the London market.

Also targeted is the ICE Brent futures contract, "which acts as the crude oil futures market’s principal financial benchmark", the Treasury said.

The government wants to extend the legislation to cover also the WM/Reuters 4pm London Fix, or "dominant global foreign exchange benchmark" and the ISDAFix, described as the "principal global benchmark for swap rates and spreads for interest rate swap transactions".

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Posted at 8:32 AM (CST) by & filed under Jim's Mailbox.

Jim,

Many of your readers believe the price of gold is going down because of heavy selling pressure. I believe that is NOT the case at all. It’s all about the Dollar.

Even if no gold changed hands it would still be revalued if the dollar strengthens or weakens. Without any trading in gold, if the dollar strengthens, the price of gold will drop because it will take fewer dollars to buy the stuff.

Quite simple really.

No need to panic. When the dollar does turn for the worse, you could see gold soar by $100 an ounce in a single day, whether people are buying it or even selling it.

As for the equity markets, theoretically stocks go higher on a weak currency (as we are seeing in Japan’s soaring TOPIX), and drop on a stronger currency.

The first question that comes to mind of many is : “Then why are US stocks rising along with a rising dollar?”

The answer is twofold…

Answer 1:  Central Bank intervention. They are supporting the stock market (against their mandate, mind you). They don’t want panic to ensue. They want to keep the public believing that stocks won’t go down and support the “wealth effect”.

MIRACLE PANIC BUYER LIFTS STOCKS

Answer 2: They are providing a back door exit for major institutions to get out of the market, unnoticed and without major panic selling. Not everyone will fit through the exit door when the markets turn. The Fed will supply the liquidity in to aid the funds in exiting this overblown bubble. Oh, and don’t forget what Yellen said: to paraphrase her… "the market is too complacent about the ‘extended period of time." Meaning, get ready for some corrective action to deflate the markets.

What goes up, must come down. Sir Isaac Newton didn’t come upon the notion of gravity by way of a falling apple, it was a falling market in the South Sea bubble! (just my take).

With solidarity and faith,
CIGA Wolfgang

Posted at 11:05 AM (CST) by & filed under Jim's Mailbox.

Jim,

I continue to hold my gold and shares. What is continuing to make the dollar rise so strongly? When will the tide turn or begin to turn for us? Why didn’t the shares rise with the market? Will they be hit when the market turns down?

Thank You for all you do,
CIGA George

George,

The fall in the euro due to Russian sanctions is the reason the dollar is higher by mirror image price.

Jim

Jim,

Just another indicator that the bubble is starting to burst

CIGA Craig

NYC Luxury-Condo Buyers Await New Towers as Sales Slow
By Oshrat Carmiel Sep 24, 2014 8:02 AM MT

Sales at One57, the ultra-luxury Manhattan condominium tower that set off a high-end residential construction boom, have slowed to a trickle amid competition from newer properties reaching the market.

Only two units at Extell Development Co.’s Midtown property went under contract this year through June 30, according to filings on the Tel Aviv Stock Exchange, where the company sells debt to investors. There were no sales in the final three months of 2013 at the building, which had earlier found buyers for two penthouses at more than $90 million each. About 25 of the 94 units on the market were unsold as of June 30, the filings show.

“This is not a normal pace,” Jonathan Miller, president of New York-based appraiser Miller Samuel Inc., said in an interview.“This building had many price increases when it was the only building out there, so maybe they overdid it. In other words, the sky is not the limit.”

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