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Jim Sinclair’s Commentary

Paw friends of the Sinclair Clan.




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

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

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

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

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


Is the U.S. stock market rigged?

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

Click here to watch the video…

Jim Sinclair’s Commentary

A strategy of provocation.

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

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

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

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

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

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


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

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

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

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

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

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


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

Submitted by Zachary Zeck of The Diplomat,

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

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

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

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

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


Jim Sinclair’s Commentary

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

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

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

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

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

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

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

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



Jim Sinclair’s Commentary

Bail in is certain.

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

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

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

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

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


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

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

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

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

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

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

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

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


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

CIGA Craig

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

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

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

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

Exhibit A:

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



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

CIGA Craig

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

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

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

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

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




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

CIGA Craig

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

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

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

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

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

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



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

CIGA Larry

Former Treasury Secretary Warns Of Looming Financial CRISIS

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

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

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


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

Dear CIGAs,

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

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

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

Dan Duval
JSMineset Editor

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

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

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

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

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

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


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

CIGA Craig

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


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Russia’s demands seem very reasonable.  If the West really wants to help Ukraine, they would agree to these terms but also demand NG price concessions to help Ukraine rebuild its economy. Given Kerry’s previous failures, let’s see if he can get an easy winner. I suspect he will not.

Ukraine crisis: US and Russia ministers end Paris talks
30 March 2014 Last updated at 17:22 ET
(Excerpts from article)

Hours before the Paris talks were due to take place at the Russian ambassador’s residence, Mr Lavrov told Russian state TV that Ukraine should come up with a new constitution "providing for a federal structure" and neutrality.

The Russian foreign minister said Moscow, the US and European Union should act as a support group for Kiev to begin a nationwide dialogue that did not involve the "armed radicals". Moscow claims that fascists have taken power in Ukraine, jeopardising the safety of Russian speakers.

Mr Putin is also thought to be demanding that Washington accepts Crimea’s independence from Ukraine.


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An action in support of bank Rossiya to take place in Moscow
March 30, 6:15 UTC+4

MOSCOW, March 30. /ITAR-TASS/. An action in support of bank Rossiya which has decided to work exclusively with the national currency will take place in Moscow on Sunday.

The Golden Symbol of Russian Rouble installation in front of the bank’s office in Perevedensky pereulok in Moscow will symbolize the rouble’s stability and its backing by the country’s gold reserves, the action’s organizers explained to Itar-Tass.

The action is designed to voice support for the Rossiya bank, which is creating a precedent and can make those who have initiated penalties against Russia to feel sorry about their decision.

The bank’s transition to using exclusively the rouble may prove the Russian currency’s viability and independence in world economy.

“Russia, at its present stage of development, should not be dependent on foreign currencies; its internal resources will make its own economy invulnerable to political wheeler dealers,” the action’s organizers said.

The Russian joint-stock bank, AB Rossiya, decided on Friday that it would work only with the national currency to protect its customers from dishonest actions by foreign financial institutions.



Russia’s secret weapon: crashing US economy by collapsing petrodollar
28 March, 18:29

Russia can collapse the United States, prominent US trader Jim Sinclair believes. The economist, famous for his forecasts, explains that the strength of the dollar is based on the US agreement with Saudi Arabia that all contracts for fuel deliveries be in the US dollars. Now, Moscow can collapse the petrodollar in one moment. The slapping of sanctions on Russia is tantamount to a shot in the foot. The expert explains that the only true value in the world today is the petrodollar. But Russia can collapse it by demanding Euros or Yuan for its oil.

What’s more, the US may lose its influence on Europe for good, if Russia starts selling its fuels for anything but the dollars. Angela Merkel would be only happy, for Germany, as well as other European countries would then have no need for currency markets. The rate of the Euro would then grow, while the cost of oil and gas would go down. But the United States should be ready for an abrupt increase in gasoline prices, for hyperinflation amid a poor business climate and a crash of the Dow Jones industrial average, Sinclair predicts.

But does Moscow need this kind of scenario? One of the tough measures that the West said it would resort to should be cutting Russia off the SWIFT interbank payment system. But should this happen, the sanctions would hit hardest their own authors, says a Stock Market Chair Professor at the Higher School of Economics in Moscow, Alexander Abramov, and elaborates.

"Technically, it is pretty easy to cut Russia off the SWIFT system by blocking Russian banks’ IP addresses. But SWIFT is one of the main systems that banks use for international payments. Hardly anyone in the US or Europe would like to resort to this kind of move, since banks are interrelated. If Russian banks are unable to use the system, they will fail to make timely payments to their western counter parties, which will prove quite a shock to the financial system. Now, this is by far more real a threat than using Euros to pay for oil. I think the financial world, which has just started emerging from the crisis, can’t be happy about these kinds of shocks".

Now, Moscow would not have to exert itself to retaliate for sanctions, says the director of the analytical service of the Alpari Company, Alexander Razuvayev, and elaborates.


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Russia’s Lukoil begins output from giant Iraq oilfield
Sat, Mar 29 20:58 PM IST
By Aref Mohammed

BASRA, Iraq, March 29 (Reuters) – Russia’s Lukoil began commercial production from one of the world’s largest untapped oilfields in Iraq on Saturday, as the country raises output to record levels.

Production from the giant West Qurna-2 is eventually expected to reach 1.2 million barrels per day (bpd), from an initial 120,000 bpd.

The field is one of several that form the backbone of Iraq’s plans to revive its oil sector and lift the economy after decades of sanctions and war.

At a ceremony to inaugurate the field, Iraqi Oil Minister Abdul Kareem Luaibi said output of 400,000 bpd from West Qurna-2 by the end of the year would help Iraq reach a production target of 4 million bpd for 2014.

Output from Iraq, already the second-largest producer in OPEC, averaged 3.5 million bpd in February.

The launch of West Qurna-2, with recoverable reserves estimated at around 14 billion barrels, will allow Lukoil, which holds a 75-percent stake in the field, to more than double its overseas output.


Ukraine Shoc

ks Population With Staggered 100% Heating Price Increase While Restricting Cash Use
Submitted by Tyler Durden on 03/28/2014 17:23 -0400

In a TV address to his divided nation, Ukraine’s PM Yatsenyuk stunned the people by first suggesting heating prices would rise gradually, then confirming a plan that will see prices rise 100% in the next 2 years (and almost 200% by 2017) as the cost of imported Russian gas is expected to be around $500 (up from the current $84). This standard of living crushing move was then followed by tougher capital controls, restricting cash purchases to around $1300 per person per day after the Central bank basically admitted "amid a tense situation in money markets" it was broke. And all of this comes on the heels of what can only be described as a vague pro-forma comment by US and EU governments over the riots by the "Right Sector" ultranationalists that clearly did not want to upset the state-sponsored thugs too much.

Yatsenyuk addressed the nation in a TV appearance:




So a 182% increase by 2017





And then, via The Ukraine Central Bank, they implement tougher capital controls:






After admitting they are broke…

Taking into account the preservation of the tense situation in the money market, the Decree ? 172 introduced some additional stabilization measures, such as:


Putin orders Ukrainian weapons returned from Crimea
Published time: March 28, 2014 14:51
Edited time: March 28, 2014 16:06

President Vladimir Putin has ordered all weapons and hardware left by the Ukrainian military after Crimea’s accession to Russia to be returned to Ukraine.

The Russian President, who is also the commander-in-chief of the military forces, gave the order to Defense Minister Sergey Shoigu at a rank-conferring ceremony in Moscow on Friday. The order concerns weapons, and military hardware including aircraft and ships.

Shoigu reported that Ukrainian units stationed in Crimea who had not wished to come over to the Russian side had left Crimean territory.

The minister added that the flags and symbols on all the ships that remained in Crimea were changed to Russian. “We have not allowed any acts of desecration and disrespect towards Ukrainian state emblems,” the official added.

After the overwhelming majority of people in the Autonomous Republic of Crimea voted to secede from Ukraine and join the Russian Federation earlier this month the Ukrainian servicemen stationed on the peninsula were given the choice of swearing allegiance to the new authorities or leave for Ukraine. The Ukrainian military bases were taken under the control of security forces because of fears the weapons could fall into the hands of Ukrainian radicals.


February Pending Home Sales Continue Slide
Media Contact: Walter Molony

WASHINGTON (March 27, 2014) – Pending home sales declined for the eighth straight month in February, according to the National Association of Realtors®. Modest increases in the Midwest and West were offset by declines in the Northeast and South; all regions are below a year ago.

The Pending Home Sales Index,* a forward-looking indicator based on contract signings, dipped 0.8 percent to 93.9 from a downwardly revised 94.7 in January, and is 10.5 percent below February 2013 when it was 104.9. The February reading was the lowest since October 2011, when it was 92.2.

Lawrence Yun, NAR chief economist, said the recent slowdown in home sales may be behind us, while home prices continue to rise. “Contract signings for the past three months have been little changed, implying the market appears to be stabilizing,” he said. “Moreover, buyer traffic information from our monthly Realtor® survey shows a modest turnaround, and some weather delayed transactions should close in the spring.”

The PHSI in the Northeast declined 2.4 percent to 77.1 in February, and is 7.4 percent below a year ago. In the Midwest the index rose 2.8 percent to 95.3 in February, but is 8.5 percent lower than February 2013. Pending home sales in the South fell 4.0 percent to an index of 106.3 in February, and are 9.3 percent below a year ago. The index in the West increased 2.3 percent in February to 86.1, but is 16.5 percent below February 2013.

Total existing-home sales are forecast at 5.0 million this year, just below the nearly 5.1 million in 2013. Housing starts are projected to rise almost 19 percent in 2014, and reach about 1.1 million, closer to the underlying demand of 1.5 million.