Posted at 4:51 PM (CST) by & filed under In The News.

China expands plans for World Bank rival
By Jamil Anderlini in Beijing
June 24, 2014 7:54 pm

China is expanding plans to establish a global financial institution to rival the World Bank and the Asian Development Bank, which Beijing fears are too influenced by the US and its allies.

In meetings with other countries, Beijing has proposed doubling the size of registered capital for the proposed bank to $100bn, according to two people familiar with the matter.

So far, 22 countries across the region, including several wealthy states in the Middle East, which China refers to as “West Asia”, have shown interest in the multilateral lender, which would be known as the Asian Infrastructure Investment Bank. It would initially focus on building a new version of the “silk road”, the ancient trade route that once connected Europe to China.

Most of the funding for the lender would come from China and be spent on infrastructure projects across the region, including a direct rail link from Beijing to Baghdad.

China’s push for a regional institution that it would control reflects Beijing’s frustration at western dominance of the multilateral bodies. Chinese leaders have demanded a greater say in institutions such as the World Bank, International Monetary Fund and Asian Development Bank for years but changes to reflect China’s increasing economic importance and power have been painfully slow.

“China feels it can’t get anything done in the World Bank or the IMF so it wants to set up its own World Bank that it can control itself,” said one person directly involved in discussions to establish the AIIB. “There is a lot of interest from across Asia but China is going to go ahead with this even if nobody else joins it.”



Gazprom says gas transit via Ukraine may be stopped completely
June 27, 16:55 UTC+4 
Gazprom has started pumping gas into European gas storage facilities and it plans to pump 5 billion cubic meters

MOSCOW, June 27./ITAR-TASS/.Russia’s gas giant Gazprom does not rule out gas transit via Ukraine may be stopped completely.

“What happened once is a tendency, nothing happens incidentally. In 2009, gas supplies were stopped completely — so, we know precedents,” Gazprom CEO Alexei Miller told a briefing on Friday.

Ukainian gas transportation system

Gazprom not interested in participation in Ukraine’s gas transportation system (GTS), “train has departed”, CEO said.

“The train has already departed. It seems it departed yesterday,” Miller said.

“It belongs to no one. The GTS has no owner,” he said. “The GTS of Ukraine does not belong to Naftogaz but to the Ukrainian government. Before discussing things with someone regarding modernization and cooperation, it should appear on the balance sheet of this or that economic entity.”

“Property and legal issues should be resolved first,” Miller said.


Austria’s OMV and Russia’s Gazprom have signed a deal for the Austrian section of the controversial South Stream gas pipeline that bypasses Ukraine. Austria’s president, Heinz Fischer, has rejected US and EU criticism.

Austrian energy company OMV and Russia’s Gazprom signed a contract on Tuesday for the construction of the South Stream pipeline’s Austrian section.

It came just hours before Russian President Vladimir Putin arrived in Vienna for a one-day visit.

While OMV general director Gerhard Roiss said the South Stream pipeline would "ensure energy security for Europe, particularly for Austria," the US embassy in Vienna launched a thinly veiled attack on the move.

In a statement, it said that trans-Atlantic unity had been essential in "discouraging further Russian aggression" and that the Austrians "should consider carefully whether today’s events contribute to that effort."

In a meeting with Austrian president Heinz Fischer, Putin slammed the criticism by saying that "our American friends… want to supply Europe with gas themselves. They do everything to derail this contract…"


Posted at 3:23 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

The latest from John Williams’

- Collapsing First-Quarter 2014 Economic Activity (GDP, GNP and GDI) Fell Below Third-Quarter 2013 Levels
- GDP Activity Fell, Even Before Adjusting for Slowing Inventory Growth
- Quarterly GDP Activity Contracted, Even Before Adjusting for Inflation
- Looming Second-Quarter Economic Contraction Likely to Formalize “Renewed” Recession and to Hit Markets Hard
- Durable Goods Orders Turned Down in Otherwise Stagnant Activity
- Despite Monthly Gain, Existing-Homes Sales Continued in Annual Contraction
- Neither Monthly nor Annual New-Home Sales Gain Was Statistically-Significant

"No. 637: GDP Revision, Durable Goods Orders, New- and Existing-Home Sales"




Gazprom Ready To Drop Dollar, Settle China Contracts In Yuan Or Rubles
Tyler Durden on 06/26/2014 08:08 -0400

A little over a month ago, when Russia announced the much anticipated "Holy Grail" energy deal with China, some were disappointed that despite this symbolic agreement meant to break the petrodollar’s stranglehold on the rest of the world, neither Russia nor China announced payment terms to be in anything but dollars. In doing so they admitted that while both nations are eager to move away from a US Dollar reserve currency, neither is yet able to provide an alternative. This changed rather dramatically overnight when in a little noticed statement, Gazprom’s CFO Andrey Kruglov uttered the magic words (via Bloomberg):


In other words just as the US may or may not be preparing to export crude – a step which would weaken the dollar’s reserve status as traditional US oil trading partners will need to find other import customers who pay in non-USD currencies – the world’s two other superpowers are preparing to respond. And once the bilateral trade in Rubles or Renminbi is established, the rest of the energy world will piggyback.

But wait, there’s more. Because only now does Gazprom appear to be unveiling all those "tangents" that were expected to hit the tape in May. Among Kruglov’s other revelations were that Gazprom is in talks on a Hong Kong listing and is weighing the issuance of Yuan bonds. Gazprom is also considering selling bonds in Singapore dollars, the CFO said at briefing in Moscow. Wait, you mean that by alienating and embargoing Russia from western (USD, EUR-denominated) funding markets, it has pushed the country to turn to its pivoting partner, China and thus further cementing the framework for the next Eurasian strategic alliance?


But wait, there’s still more, because it is  not just Gazprom. As the PBOC announced overnight,  PBOC Assistant Governor Jin Qi and Russian central bank Deputy Chairman Dmitry Skobelkin led a meeting held yesterday and today in Shanghai.  The meeting discussed cooperating on project and trade financing using local currencies. The meeting discussed cooperation in bank card, insurance and financial supervision sectors.

In other words, central bankers of China and Russia discussed how to replace the dollar with Rubles and Yuan. From the PBOC:


China Finds $15 Billion of Loans Backed by Fake Gold Trades
By Bloomberg News Jun 26, 2014 8:13 AM MT

China’s chief auditor discovered 94.4 billion yuan ($15.2 billion) of loans backed by falsified gold transactions, adding to signs of possible fraud in commodities financing deals.

Twenty-five bullion processors in China, the biggest producer and consumer of gold, made a combined profit of more than 900 million yuan from the loans, according to a report on the National Audit Office’s website.

Public security authorities are also probing alleged fraud at Qingdao Port, where copper and aluminum stockpiles may have been pledged multiple times as collateral for loans. Steps by the Chinese government to rein in credit by raising borrowing costs in recent years created a surge in commodities financing deals that Goldman Sachs Group Inc. estimates to be worth as much as $160 billion.

“This is the first official confirmation of what many people have suspected for a long time — that gold is widely used in Chinese commodity financing deals,” said Liu Xu, a senior analyst at Capital Futures Co. in Beijing. “Any scaling back by banks of gold-backed financing deals might lead to a short-term reduction in Chinese imports and also spur some sales by companies looking to repay lenders.”

As much as 1,000 metric tons of gold may have been used in lending and leasing deals in China, where commodities including metals and agricultural products are used to get credit amid lending restrictions, according to World Gold Council estimates.


Obama won’t impose anti-Russia sanctions without Europe’s support – media

US President Barack Obama won’t impose new sanctions against Russia if European countries refuse to do so, the source of Bloomberg in the White House said.

Barack Obama understands that if he imposes sanctions without the support of his European partners, the sanctions may hurt the interests of American companies.

"President Obama understands that American companies shouldn’t find themselves in an unfavorable situation," Josh Earnest, White House Assistant to the President, said during a brief talk in Washington.

The US as well as European countries intend to impose sanctions despite the fact that yesterday Russian parliamentarians denied a decree on the use of Russian military forces in Ukraine. The corresponding suggestion was submitted by Russian President Vladimir Putin.

Moscow should take more resolute measures to settle the Ukrainian crisis, President of the European Commission José Manuel Barroso said.

The sanctions that the US and Europe are ready to impose, can affect the Russian energy sector and Russia’s access to the international market.


Gold’s Flow East Seen for 20 Years as Incomes Increase Demand
By Glenys Sim and Jasmine Ng  Jun 26, 2014 7:51 AM ET 

The global flow of gold from west to east that helped to make China the world’s largest user will probably last for up to two decades as rising incomes spur demand, according to the China Gold Association.

China’s consumption, which increased to a record 1,176.4 metric tons in 2013, is expected to be “more or less the same” this year, Zhang Bingnan, vice-chairman and general secretary at the association, said in an interview inSingapore. China accounted for about 28 percent of global usage last year, according to the London-based World Gold Council.

Purchases in China accelerated last year after a 28 percent price slump, and the country displaced India as the biggest bullion buyer while European consumption shrank. Demand in China will rise about 25 percent in the next four years as an increasing population gets wealthier, the council said in April.

“In the next 10 to 20 years the trend probably won’t change because there is more gold in the west and less of it in the east,” said Zhang, who also addressed an industry conference in the city-state yesterday. “As incomes in the east rise, demand for gold will follow a similar trend and continue in the future whether in China or India or other developing countries, unless there’s some extraordinary event.”


Draghi Says Unlimited Cash Through 2016 Is Rate Signal
By Jeff Black  Jun 23, 2014 4:36 AM ET

Mario Draghi indicated that the European Central Bank’s interest rates will probably remain low for at least another 2 1/2 years.

“We have prolonged banks’ access to unlimited liquidity up to the end of 2016. That is a signal,” the ECB president said in an interview published in Dutch newspaper De Telegraaf on June 21, responding to a question on how long rates will stay low. “Our program in support of bank lending to businesses will continue for four years. That shows that interest rates will remain low over a longer period. But thereafter they will increase when the recovery will firm up.”

A year after the euro area exited its longest recession, the Frankfurt-based ECB is still battling too-low inflation and attempting to reboot demand. Draghi introduced an unprecedented range of measures this month including a negative deposit rate and said quantitative easing remains an option if deflation appears.

The recovery “is still weak and unevenly distributed across the euro area,” Draghi said. “Accidents could happen in the global economy that can quickly change the situation.”

Growth in euro-area manufacturing and services slowed for a second month in June, according to purchasing managers indexes published by Markit Economics today. Manufacturing contracted for a second month in France, while expanding for a 12th month in Germany.


Syrian warplanes reportedly strike in Iraq, killing 57 civilians
By Mohammed Tawfeeq, Holly Yan and Chelsea J. Carter, CNN
June 25, 2014 — Updated 1920 GMT (0320 HKT)

Baghdad, Iraq (CNN) — Reports that Syrian warplanes carried out a cross-border attack on Iraqi towns this week is further evidence of the blurring between the two countries’ borders as they face an offensive by Islamic extremists.

At least 57 Iraqi civilians were killed and more than 120 others were wounded by what local officials say were Syrian warplanes that struck several border areas of Anbar province Tuesday.

These border cities are among those under the control of the Islamic State in Iraq and Syria, or ISIS, which seeks to create an Islamic caliphate that encompasses portions of Iraq in Syria.

Reports of the Syrian incursion into Iraq is a reminder that the civil war in Syria and the unrest in Iraq are not isolated, but linked in ways that threaten the security of both.

Sabah Karkhout, head of Iraq’s Anbar provincial council, told CNN that Tuesday’s air attacks struck markets and fuel stations in areas such as Rutba, al-Walid and Al-Qaim.


King Abdullah calls up Saudi armed forces on high preparedness. Egyptian troops ready to fly to kingdom
DEBKAfile Exclusive Report June 26, 2014, 6:49 PM (IDT)

Thursday, June 26, the day before US Secretary of State John Kerry was due in Riyadh, King Abdullah summoned a National Security Council meeting “upon the current security events in the region, especially in Iraq,” and ordered “all necessary measures to protect the kingdom against terrorist threats.” This meant a general call-up of military units for a high level of preparedness.

debkafile’s military sources disclose that Egypt is assembling an expeditionary commando force to fly to Saudi Arabia and bolster its border defenses.
This flurry of Saudi-Egyptian military steps comes in the wake of intelligence gathered by Saudi reconnaissance planes showing Iraqi Al Qaeda-linked Sunni fighters (ISIS) heading for the Saudi border and aiming to seize control of the Iraqi-Saudi crossing at Ar Ar (pop: 200,000).

ISIS and its Sunni allies are still on the march after capturing Iraq’s border crossings with Syria and Jordan earlier this week.

On Wednesday, Kerry warned Mideast nations against taking new military action in Iraq that might heighten sectarian divisions.
By then, he had been overtaken by a rush of events, as debkafile reported this morning.

When the first of the 300 military advisers US President Barack Obama promised the Iraqi government arrived in Baghdad Wednesday, June 25, Iranian and Saudi Arabian arms shipments were already in full flow to opposing sides in embattled Iraq, debkafile’s military sources report.



Kerry warns Mideast nations against military action in Iraq
DEBKAfile June 26, 2014, 6:00 PM (IDT)

BAGHDAD (CBS News/CBSDC/AP) — U.S. Secretary of State John Kerry warned Mideast nations on Wednesday against taking new military action in Iraq that might heighten sectarian divisions, after Syria launched airstrikes across the border and Iran flew surveillance drones over the neighboring country.

The U.S. and a senior Iraqi military official confirmed that Syrian warplanes bombed militants’ positions Tuesday in and near the border crossing in the town of Qaim. The Iraqi official said Iraq’s other neighbors – Jordan, Kuwait, Saudi Arabia and Turkey – were all bolstering flights just inside their airspace to monitor the situation. He spoke on condition of anonymity because he was not authorized to speak to the media.

American officials said the strikes appeared to be the work of Syrian President Bashar Assad’s government. They said the target was the Islamic State of Iraq and Syria (ISIS), a Sunni extremist group that seeks to carve out a purist Islamic enclave across both sides of the Syria-Iraq border. The group is also known as Islamic State of Iraq and the Levan (ISIL).

“We’ve made it clear to everyone in the region that we don’t need anything to take place that might exacerbate sectarian divisions that are already at a heightened level of tension,” Kerry said, speaking at a meeting of diplomats from NATO nations. “It’s already important that nothing take place that contributes to the extremism or could act as a flash point with respects to the sectarian divide.”

Kerry said Baghdad needs to take steps to ensure that Iraq’s military can defend the country without relying on outside forces. The U.S. is sending 300 military advisers.



Barclays pulls bond offering after lawsuit emerges

Barclays pulled a US$1.5bn bond offering on Wednesday after it emerged that the New York attorney general was preparing to sue the UK bank for securities fraud.

It had already amassed more than US$4.5bn in orders for the 10-year subordinated deal, market sources said, when reports of the lawsuit hit trading screens.

"Investors just baulked," one portfolio manager who had been looking at the deal told IFR.

"If something dire does come out the suit, then that could mean that the deal has to be nullified anyway – so it was just better to pull it."

Shares in Barclays traded sharply lower on Thursday morning in London, down some 4 percent in early deals.


Posted at 3:07 PM (CST) by & filed under General Editorial.

Dear CIGAs,

We are happy to announce the next upcoming Q&A session will be held in Seattle, WA. 


Saturday, July 12, 2014 from 1-5pm


Hilton Seattle
1301 6th Avenue
Seattle, WA 98101

**The hotel is offering discounted parking for the event at $13.00 each


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

Click here to purchase tickets…

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

We look forward to seeing you there!

Posted at 12:22 PM (CST) by & filed under In The News.



Putin Scores Another Historic Victory: Austria Signs South Stream Pipeline Deal In Defiance Of Europe
Submitted by Tyler Durden on 06/25/2014 07:23 -0400

As the war of words between Europe and Russia has escalated, one of the outcomes that has emerged is that just like in false flag war over Syria, the Ukraine war was about the simplest possible thing, and yet so very complicate: a gas pipeline. Of course, it was never a secret that the prize in controlling Ukraine was possession of the vast pipeline infrastructure that left Russia and entered Europe, but since it was all Gazprom’s gas in the first place, it didn’t really matter if Kiev had possession of the gas as it transits to Europe, or if, as the case is now, Ukraine is merely a transit hub with all Russian gas delivered to European countries and none of it staying in the civil war torn country. After all as of this moment Ukraine can’t afford any Russian gas, and if it siphons off any of the product destined for Germany and beyond it would simply antagonize its new NATO best friends, who also happen to be Gazprom clients.

No, the pipeline that has emerged with a starring role in the Ukraine conflict has nothing to do with Ukraine, but is a pipeline that crosses several hundred kilometers south of Ukraine – the South Stream project, which leaves the Russian black sea coast south of Crimea, crosses the black sea, and traverses Bulgaria, Serbia, Hungary and ends up in the gas hub in Baumgarten, Austria from where it proceeds to all points in central Europe, mostly Germany.

The project, which was conceived in 2007, was meant explicitly to bypass Ukraine, and to be an alternative to the now mothballed Nabucco gas pipeline which, with the backing of the US and Europe, would have taken Caspian gas (mainly Azerbaijan and Turkmenistan) and traverse Turkey before emerging in Bulgaria, and then followed the European path of the South Stream into the Austrian hub and beyond.


Not surprisingly, it was the key transit hub of the South Stream, Bulgaria, that started making problems for Putin even as he succeeded in trumping Nabucco (when in June 2013 the CEO of Austrian energy giant OMV, Gerhard Roiss, announced the project as "over" after the Turkish Shah Deniz consortium chose the Trans-Adriatic Pipieline over Nabucco as a gas export route which would supply Italy instead of Austria).



Koos Jansen: Shanghai exchange chief confirms WGC badly underestimates gold demand
Submitted by cpowell on 05:20AM ET Wednesday, June 25, 2014. Section: Daily Dispatches
8:15a ET Wednesday, June 25, 2014

Dear Friend of GATA and Gold:

Gold researcher and GATA consultant Koos Jansen today reports confirmation from the chairman of the Shanghai Gold Exchange that offtake from the exchange exceeded 2,000 tonnes in 2013, nearly doubling the estimate of Chinese gold demand made by the World Gold Council. Jansen also reports the assertion by the chief of the precious metals department of Industrial and Commercial Bank of China, the world’s largest bank, that pricing for gold will shift from the derivatives market to the physical market.

The information comes to Jansen from an associate reporting on the proceedings of the London Bullion Market Association meeting in Singapore.

Together these assertions seem to constitute the best confirmation yet that China’s view of the gold market is GATA’s view and not the purported view of the bullion bankers in London, New York, and Washington.

Jansen’s report is posted at his Internet site, In Gold We Trust, here:…

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.





Singapore to launch gold contract
Submitted by cpowell on 07:02AM ET Wednesday, June 25, 2014. Section: Daily Dispatches
By Jeremy Grant

Financial Times, London
Wednesday, June 25, 2014

SINGAPORE — Singapore has unveiled plans for an exchange-traded gold contract, boosting its ambitions to become Southeast Asia’s gold trading hub and adding to calls for gold pricing to be influenced more by Asian trade.

At the same time the Shanghai Gold Exchange said it wanted to attract foreign bullion dealers to use China’s recently established free trade zone to store and trade gold. …

The Singapore gold contract will be a 25 "kilobar" gold future offered on SGX, the Singapore exchange, and will be settled daily for physical delivery on a six-day rolling basis, the bourse told the London Bullion Market Association’s annual forum, being held in Singapore for the first time.

Four banks — JPMorgan, Standard Chartered, Standard Bank, and Bank of Nova Scotia — have signed up as market makers. …

… For the full story:


Disruption of natural gas supply would cause consequences for EU – Oettinger
Guenther Oettinger

Any disruption of the Russian natural gas supply via Ukraine would cause significant consequences for the EU, European commissioner Guenther Oettinger says.

"The issue of energy security once again became a political priority due to concerns regarding tensions between Russia and Ukraine. Russia is our main energy supplier and Ukraine is a key energy resources transit country for the EU. In this context any disruptions of supply would cause significant consequences for the EU and the whole of Europe," Mr. Oettinger said during a roundtable discussion on the EU energy policy.

Ukrainian Energy Minister to discuss reverse gas supply via Slovakia with EU’s Oettinger in Brussels

Guenther Oettinger, Europan Commmissioner for Energy, and Yury Prodan, Verkhovna Rada-appointd Ukrainian Minister of Energy and the Coal Industry, meet here on Wednesday to discuss matters concerning a reverse supply of natural gas to Ukraine via Slovakia and prospects for a resumption of three-sided talks on natural gas among Moscow, Kiev, and Brussels. The meeting will be a closed-door one and no specific decisions are expected to be made, an official in the European Commission (EC) press service said.

"The meeting will be of technical nature and will be held in a closed-door mode," the EC official pointed out.

According to to the TASS news agency, at the meeting, Ukraine expects to discuss the possibility of giving greater scope to reverse deliveries of gas from Slovakia. The European Commission intends to study the possibility of a resumption in mid-July of the three-sided talks among Russia, Ukraine, and the European Union on prices of natural gas and Kiev’s debt.

The EC reported earlier that the maximum amount of gas supplied from Slovakia in a reverse mode might be about eight billion cubic metres of gas a year. A price of reverse-supplied gas has not yet been confirmed.


New York Attorney General Sues Barclays Over HFT
by Mark Melin

Barclays will be accused of providing HFT firms undisclosed benefits over other market participants

Bloomberg’s Keri Geiger is reporting that New York Attorney General Eric Schneiderman will announce at 4pm ET that Barclays PLC (ADR) (NYSE:BCS) (LON:BARC) will be sued over fraud allegations related to its Dark Pool’s preferential treatment of high-frequency traders.

Barclays being sued by New York Attorney General

“Barclays PLC is being sued by New York’s attorney general over allegations that the bank’s dark pool gave high-frequency traders advantages over other customers, despite saying otherwise,” Bloomberg reported, quoting a person familiar with the matter.

This will be the first criminal action related to high frequency trading since Michael Lewis released the book Flash Boys, which recently rocketed to the top ten on the best seller list and Sony Pictures announced that it was producing a major motion picture from the book.

Barclays runs the largest dark pool

Barclays PLC (ADR) (NYSE:BCS) (LON:BARC) runs one of the market’s largest dark pools where stocks are traded anonymously and exchange trade rules are not published. The primary issue could be undisclosed deals that provide special access to HFT traders not available to the general market, ValueWalk sources close to the high frequency trading world indicated. These deals enable the HFT firms to receive information and quicker trading access to the market. Sources indicate they were marketed to some HFT firms as providing a rare access to the market only available on a limited basis.


Posted at 3:08 PM (CST) by & filed under In The News.

ISIS takes over Iraq’s main oil refinery at Baiji – reports
Published time: June 24, 2014 03:56 
Edited time: June 24, 2014 10:23

Sunni militants have gained full control over Iraq’s main oil refinery at Baiji, south of Mosul, according to media reports.

Radicals from the Islamic State in Iraq and the Levant (ISIS, or ISIL) have been attacking the refinery, which is responsible for supplying a third of Iraq’s oil, for the past ten days.

The militants are planning to hand over the complex to local tribes for day-to-day management, BBC quoted a rebels’ spokesman as saying, adding that the militants will continue to make their way to Baghdad.

Al-Arabiya also reported that the refinery was taken over by Sunni militants. Meanwhile three Iraqi officials also confirmed to CNN the militants had seized the Baiji oil refinery.

The Baiji complex plays a key role for Iraqis as it refines the country’s crude into petroleum for domestic consumption, including for transportation and power stations, sparking fears of shortages.



Pro-Russian Separatists Down Ukraine Chopper As Putin Revokes Right To Military Intervention
Tyler Durden on 06/24/2014 11:19 -0400

In a rather stunning step for the West’s propaganda machine, ‘devil-incarnate’Putin has asked the Russian parliament to revoke the right of military intervention in Ukraine. As The BBC reports, Vladimir Putin’s move was aimed at "normalising the situation" in the conflict-torn eastern regions of Ukraine, his press-secretary said. Ukraine added that this move was a "first practical step" towards settling the crisis in the east. Presidential spokesman Peskov said the move was linked to Monday’s launch of talks between Kiev and separatist leaders in the east (with the case-fire deadline ending Friday). One can only wonder, why now? for Putin’s gesture of peace? Cold showers enough in Kiev? Or is it that oil prices are high enough to help thanks to the Iraq situation and his Syrian ‘aid’ is needed as Ukraine festers?

Via The BBC,

Russia’s president has asked parliament to revoke the right of military intervention in Ukraine, where rebels have been fighting government troops.

Vladimir Putin’s move was aimed at "normalising the situation" in the conflict-torn eastern regions of Ukraine, his press-secretary said.

The parliament authorised Mr Putin to use force in Ukraine on 1 March.


Moody’s cuts outlook for Canadian bank debt to negative over ‘bail-in’ regime
Barbara Shecter | June 11, 2014 12:19 PM ET

As governments around the world implement “bail-in” provisions to avoid taxpayer-funded bank bailouts, Moody’s Investors Service took action in Canada on Wednesday by changing the outlook to negative from stable on some of the senior debt and uninsured deposits of Canada’s largest seven banks.

The ratings agency, which at the same time affirmed the long-term ratings of the banks, said it took the action on the supported senior debt and uninsured deposit ratings “in the context of previously announced plans by the Canadian government to implement a ‘bail-in’ regime for domestic systemically important banks.”

Moody’s also cited an “accelerating” global trend towards reducing the public cost of future bank “resolutions.”

Senior debt holders would take a hit before taxpayers would

David Beattie, a vice-president in the financial institutions group at Moody’s, said the Canadian government made clear in the spring of 2013 that taxpayers would not be on the hook in the unlikely event that a Canadian bank needed to be bailed out.

“Their objectives are to spare the public purse,” he said in an interview. “Senior debt holders would take a hit before taxpayers would.”

The changes by Moody’s affect all seven of Canada’s biggest banks, including Toronto-Dominion Bank, Royal Bank of Canada, and Bank of Nova Scotia.

Canada’s banks weathered the financial crisis of 2008 better than many of their international peers which required expensive taxpayer-funded bailouts to stay afloat. Since the crisis, governments and regulators around the world have been laying the groundwork for bail-ins. In some of these scenarios, creditors holding instruments such as a new breed of convertible bonds bear at least some of the burden of stabilizing a bank in crisis.


Singapore to launch gold contract as Asia eyes price alternatives
Tue Jun 24, 2014 7:40am EDT
By A. Ananthalakshmi

SINGAPORE, June 24 (Reuters) – Singapore is set to announce the launch of a gold futures contract on Wednesday, two sources familiar with the matter said, joining a race in Asia to provide a viable alternative to the metal’s global benchmark which is under regulatory scrutiny.

The physically settled contract will trade on the Singapore Exchange. This and other planned contracts in Hong Kong and China could cut Asian reliance on gold’s spot price benchmark in London and futures bellwether in New York.

"Having a local price for local markets ensures that markets are more efficient and that the price accurately reflects where the metal is locally trading," said Ruth Crowell, chief executive of industry group London Bullion Market Association.

"As more markets develop, local prices for precious metals will become more tailored."

The Singapore Exchange did not respond to phone calls or an email seeking comment.

The price benchmark for gold is the so-called London ‘fix’, determined by a group of four banks over a teleconference. The process has drawn attention recently, after regulators in Europe and the United States started to probe benchmarks in several markets following the Libor manipulation case in 2012.

China and India account for more than half of global gold consumption but Asia still largely relies on the London fix for reference. The fix is set twice daily, at 1030 and 1500 London time – both much after Asian markets close.



Russia, France may opt to use RMB for global transactions
2014-06-24 11:39 (GMT+8)

The use of the Chinese yuan or renminbi for settlement in international trade is gaining momentum, as recent developments around the world have encouraged a shift away from the US dollar, reports the Beijing-based China Times (not our sister paper).

Christian Noyer, governor of the Bank of France, recently stated in a television interview on June 11 that companies from his country might stop using the dollar for trade with China, as French bank BNP Paribas was still negotiating with US authorities over alleged violations of sanctions imposed on Iran and Sudan.

Meanwhile, Pavel Teplukhin, head of Deutsche Bank in Russia, told the UK’s Financial Times in early June that a growing number of large Russian companies had expressed an interest in using the yuan and other Asian currencies, and opening accounts in Asian countries, given the tension between the United States and Russia over the Ukraine crisis.

Teplukhin said the development is unlikely to be short term and may become a trend in the market.

While these events seemed unrelated, the paper said they did not happen overnight. China and Russia already use their own currencies for cross-border trades, which has risen from 2009′s 3.6 billion yuan (US$578.8 million) to 2013′s 4.6 trillion yuan (US$743.5 billion). In addition, French media reported that a tenth of France’s trade with China was settled in the Chinese currency in 2013.

Lian Ping, chief economist of the Bank of Communications, said China recorded faster growth in trade with Russia, which is set to surge further on imports of resources and energy, and the use of their respective currencies could help reduce foreign exchange risks and lower costs for businesses. Lian added that the use of yuan in China-Russia trade could also help push the internationalization of the Chinese currency.


What would the US do if war were to break out over Diaoyutai?
2014-06-24 11:15 (GMT+8)

In an article for the Washington-based National Interest magazine on June 21, US defense expert Harry Kazianis laid out a possible a scenario involving Japan and China clashing over the airspace of the disputed Diaoyutai islands (Senkaku to Japan, Diaoyu to China) in the East China Sea to analyze whether the United States would be ready for such a conflict.

The scenario takes place on March 1, 2015, Kazianis wrote, noting that China has already instituted daily non-naval maritime patrols around the disputed islands while its aircraft carrier Liaoning and other warships have conducted exercises only 50 miles away from the islands since February.

Kazianis described that two Chinese SU-27 fighters would come within 25 feet of a Japanese P-3 Orion surveillance plane just 10 miles west of the Diaoyutai on the first day of March 2015 — mirroring an actual event that took place over China’s southern island province of Hainan in April, 2001, when a Su-27 fighter collided with a P-3.

According to the scenario, "the Japanese plane collides with one of the Chinese fighters. Both aircraft crash into the ocean, with no survivors." "Just 72 hours later, a group of twenty Chinese nationals land on one of the disputed islands under the cover of darkness."

A Japanese naval task force carrying a small detachment of soldiers would then be dispatched to remove the Chinese civilians from the islands, with Beijing threatening force if its citizens are harmed.


Posted at 2:11 PM (CST) by & filed under In The News.

It’s A Trap?!?!
Author : Bill Holter for Miles Franklin
Published: June 23rd, 2014

“Gold and silver have turned!”  I bet you have heard that one before.  In fact, I said this almost 12 months ago at the end of last June.  Back then we had another 2 day waterfall event which became common events throughout 2013.  As it turns out, that event was the (a) “retest” of $1,180 in gold and $18 in silver.  I believe that last June really was the bottom in price.  We have chopped since then and had a good little rally to start this year off only to be pressured down again…but I believe that things have now changed.

So why did the metals soar on Thursday?  Was it because Janet Yellen and the Fed were “dovish” as is commonly thought?  Maybe, but haven’t they been dovish since 2008?  Didn’t we have QE’s 1, 2 twist and then QE3?  Hasn’t the Fed, the BOE, BOJ and ECB all flooded the markets with cheap and nearly free currency?  Yes they have, but all we have for their efforts is more debt, inflated markets and stagnant economies where it costs the average person more each day to live and survive.  Six years after the fact they are still using the word “recovery” when during a normal business cycle we would have had another recession, a second recovery and already be in a 2nd growth phase.

The list of “potential” reasons for gold to have exploded out of its “2%” lasso is many.  As mentioned above, a dovish Fed is one theory.  Zero Hedge speculates that the financial games played to depress gold in the face of record physical demand are reversing because missing collateral has become evident.  Andrew Maguire believes that the market got very short recently and the move is the beginning of a massive short squeeze.  Fundamentalists believe that this is the result of gold and silver trading at or below the costs of production.  Others are talking about the drawdowns in the COMEX, LBMA, and GLD inventories as scraping the bottom of the barrel and supply is just drying up.

I believe “all of the above” but most of all I believe that what has just started is only the very beginning of a wide and long planned out “trap” if you will.  I believe that long ago, foreigners figured out what GATA has been trying to inform the public about for what seems like forever.  First off, if GATA figured out that gold and silver prices have been manipulated and suppressed, so have others.  Not only can “others” figure it out on their own.  GATA has made all of their information 100% public and available.  They have sent evidence everywhere imaginable.  They have tirelessly sent evidence to the press, the newspapers and TV stations both here in the U.S. and abroad.  They have sent evidence to the CFTC, the SEC, regulators of foreign nations, senators, congressmen and women, you name it, and GATA has sent it.

My point is this, the information is out there for anyone with half a brain and their “door” slightly cracked open for the information to get through.  The fact that gold’s price has been suppressed has got to be known as a fact in my opinion by nearly all foreign governments.  The Germans and Austrians now know.  The Saudis know the Swiss can see it first hand.  The Chinese and Russians know, literally everyone knows but until now it was like the crazy uncle in the basement that everyone knew about but wouldn’t talk about.

It is my opinion that up until now, no one was willing to go out on a limb like Charles DeGaulle did in the late 1960′s.  No one “overtly” called on gold but through backchannels have been placing their bets and taking delivery.  This would explain the physical demand that we’ve seen.  I use the word “overtly” because until now I don’t think anyone wanted to feel the wrath of the U.S. so they went about their business behind the scenes and done so quietly.  I also believe that if there were say 3,000-5,000 tons left to accumulate a year ago, then why would you pull the plug until the last ounces were vacuumed up?  So they have waited… until the time was right.

So here we are today, one year after the bottom and what has happened?  Well, the “buyers” bought and have been taking delivery of huge weights of gold while…the U.S. has gone another $1 trillion++ in debt, the Fed added another $1 trillion to their balance sheet, corporate and individual America has gone further into debt, more manufacturing has left our shores and apparently so has some gold whether it’s been ours or someone else’s.  I think that we have arrived at the point where foreigners feel “strong” enough and see us as weak enough to all stand up in unison and say “enough.”  The amount of deals done in the last 2-3 months alone that exclude the use of dollars is staggering.  Just this past week, Britain inked a deal with China on “direct” trade between the two in sterling and Yuan.  A deal like this could never have been even contemplated just a few short years ago.  Remember, this was Great Britain who did this, supposedly our number one ally and friend with what has been described as a very “special relationship.”  For Britain to do this it tells me that it’s not just smoke in the back rooms where the deals are being done, no, it’s a raging fire.

I think that as of now, most all of the pieces are in place for the world to collectively stand up to and financially knock the U.S. off of our pedestal.  This past Thursday may have been a “test shot” to see what we have left.  It may have been “jockeying for position” or positioning before the announcement.  Like I wrote above, if I know this, if GATA knows this, then they also know.  If it were me leading the troops into this battle, I would set off a string of announcements.  Each and every one of them aimed at the dollar, our financial system and our economy.  The Russians would do the heavy lifting militarily.  The Chinese might announce their intent to “reallocate” (sell) some of their U.S. Treasury hoard.  They might also announce something like an 8,000 ton current holding of gold as a kicker.  The Saudis would announce that they will accept Yuan, rubles and euros but no longer dollars for their oil.  Trade and financial arrangements might be altered by the Europeans as their arms are twisted with withheld natural gas supplies.  This list is by no means complete but quite easily coordinated.

Before finishing I’d like to mention one other thing that is happening.  The open interest in silver has grown and grown and grown over the last several months and rests very close to the all-time highs of 3 years ago when it was priced at almost $50.  The open interest is now roughly 165,000 contracts.  The July month alone has almost 60,000 contracts open with just 8 trading days before 1st notice day.  This represents about 300 million ounces.  The dealer inventory only totals 57 million ounces and when customer held inventory is added, the total is 174 million ounces.  Clearly, if these July contracts stood for delivery then the COMEX would be cleaned out entirely.  It has been my theory that the Chinese have been accumulating silver contracts through various proxies for months on end.  I originally believed this a year ago until the open interest then diminished but here we are again.

If I am correct about my “giant trap” theory, you can bet your bottom dollar that the paper silver market is also a part of it.  The July contracts open currently amount to a whopping (sarcasm) $6 billion worth of silver and the amount available for delivery is less than $1.2 billion.  COMEX inventory in total is only $3.5 billion worth of silver.  Why would the Chinese not turn over $6 billion worth of Treasury bonds to bust the COMEX wide open?  If they did not ultimately do this, I would be shocked.  Actually if you think about it, the Chinese could do this all on their own and for “free” (only $6 billion) destroy the Western financial system by exposing the amount of metal available for delivery to be insufficient.  Why would they not just do this all on their own?  Easy, have you ever studied a pack of dogs or wolves?  While one dog may be scared away easily, when there is a pack involved there is no scaring them away.  Unfortunately, the U.S. has angered so many nations that several packs are now easily formed.  All you need to do is use a little bit of common sense to connect the announcement “dots,” new alliances and partnerships to see that the world is collectively turning into a “pack.”  Maybe I am seeing things but it looks to me like what is about to happen has and was pre planned for many years and by many parties.


Iraq army capitulates to Isis militants in four cities
Half a million people on the move after gunmen seize four cities and pillage army bases and banks
Martin Chulov in Beirut, Fazel Hawramy in Irbil and Spencer Ackerman in New York
The Guardian, Wednesday 11 June 2014

Iraq is facing its gravest test since the US-led invasion more than a decade ago, after its army capitulated to Islamist insurgents who have seized four cities and pillaged military bases and banks, in a lightning campaign which seems poised to fuel a cross-border insurgency endangering the entire region.

The extent of the Iraqi army’s defeat at the hands of militants from the Islamic State of Iraq and Syria (Isis) became clear on Wednesday when officials in Baghdad conceded that insurgents had stripped the main army base in the northern city of Mosul of weapons, released hundreds of prisoners from the city’s jails and may have seized up to $480m in banknotes from the city’s banks.

Iraqi officials told the Guardian that two divisions of Iraqi soldiers – roughly 30,000 men – simply turned and ran in the face of the assault by an insurgent force of just 800 fighters. Isis extremists roamed freely on Wednesday through the streets of Mosul, openly surprised at the ease with which they took Iraq’s second largest city after three days of sporadic fighting.

Senior government officials in Baghdad were equally shocked, accusing the army of betrayal and claiming the sacking of the city was a strategic disaster that would imperil Iraq’s borders.

The developments seriously undermine US claims to have established a unified and competent military after more than a decade of training. The US invasion and occupation cost Washington close to a trillion dollars and the lives of more than 4,500 of its soldiers. It is also thought to have killed at least 100,000 Iraqis.

Early on Thursday the Sites monitoring group in the US said it had translated an audio statement by an Isis spokesman declaring that "the battle will rage in Baghdad and Karbala … put on your belts and get ready". The New York Times, meanwhile, reported that Iraq last month secretly asked Barack Obama to consider bombing Sunni militant staging posts in Iraq.


John Kerry snubbed by Egypt’s heavy jail sentences for al-Jazeera journalists
Cairo’s decision to impose seven-year sentences has weakened Kerry after he interceded on the journalists’ behalf
Simon Tisdall
The Guardian, Monday 23 June 2014 10.43 EDT

Egypt’s military-dominated government has delivered a humiliating, public slap in the face to John Kerry, the US secretary of state, by sentencing three al-Jazeera journalists to long prison terms only hours after Kerry personally expressed his deep concern about the case in high-level meetings in Cairo. The snub represents a disastrous beginning to Kerry’s already fraught Middle East tour, which took him to Baghdad on Monday for crisis talks about the Islamist extremist uprising.

The verdict, by a court responsive to government wishes, will also be seen as a deliberate, crude signal to President Barack Obama, who criticised Egypt’s deteriorating human rights record after the former general, Abdul Fattah al-Sisi, seized power in a coup last year. Sisi has since had himself voted president. His elected predecessor, Mohammed Morsi, and thousands of his Muslim Brotherhood supporters remain in jail while hundreds of others have been killed.

In what US officials said were "candid" talks with Sisi, Kerry "emphasised our strong support for upholding the universal rights and freedoms of all Egyptians, including freedom of expression, peaceful assembly and association". He noted a number of promises by Egyptian leaders "are yet to be fulfilled", but added that "the United States remains deeply committed to seeing Egypt succeed".

The hollowness of all this careful diplomatic language was exposed for all to see by the court’s verdict, which diplomats and observers said was reached without the complication of supporting evidence. It seems clear now that Kerry was wasting his breath; the sentences were pre-determined, intended as a stark warning to Egyptian and foreign media and as a symbol of the regime’s determination to demonstrate its independence of Washington.

This is ironic given that, before the talks, the US had made available most of the $575m (£328m) in military aid frozen by Congress after the coup against Morsi. Kerry offered more blandishments in the form of 10 Apache attack helicopters, which he said would be supplied to Egypt "very soon". This is exactly the sort of deadly air power that Iraq’s government has pleaded for but has so far been denied by Obama.


Tsunami Warning Issued After 8.0 Magnitude Quake, Dozens Of Aftershocks Off Alaska’s Coast
By Brandon Mercer June 23, 2014 2:24 PM

ALEUTIAN ISLANDS (CBS SF) — A massive 7.9 revised magnitude earthquake off Alaska’s remote Aleutian Islands has triggered a regional tsunami, with reports of water already leaving some harbors including Adak Harbor, as the waves begin to come in.

California’s coastline is highlighted in the National Weather Service tsunami energy propagation map, however, no warning has been issued for the West Coast.

Seismologist David Oppenheimer stationed in Menlo Park said, “The message is simple: wait for the tsunami warning to say what’s going on, if there is a warning, NOAA will update their advisory.”

He added, “There’s report of a tsunami in Alaska, but it’s small. Had the earthquake been shallow, there could have been big waves and more displacement. NOAA is watching for tide gauges.”

With the small amount of sea floor movement, Oppenheimer was clear, “There’s nothing to be concerned about on the California coast.”


Posted at 9:56 PM (CST) by & filed under In The News.


Russia’s Air Force starts large-scale troop transfer in combat readiness check – Defense Ministry

The Russian Air Force has  stared large-scale airlifting of personnel and materiel in a combat readiness check for troops in the  Central Military District, the Defense Ministry press service report. The combat readiness test will last from June 21 to 28. The task set by the president is to assess the military’s ability to perform their duties within existing time standards over the first 24 hours, Russian Defense Minister Shoigu said.

"The transfer of troops involves over 40 Antonov An-124 Ruslan, Ilyushin Il-76, Antonov An-22 and Antonov An-26 from the military aviation transport unit in Tver, Pskov, Taganrog and Orenburg air bases, which today alone will fly over 50 missions to transfer personnel and military hardware to various destinations," a ministry report says.

Personnel and equipment from detachments of the 98th air-borne division and the 31st assault brigade of Air-Borne Troops are loaded at airdromes for subsequent transfer to the Chelyabinsk region where they will take part in an exercise with combined-arms units of the Central Military District, the press service says, Interfax reports.

Russian President and Supreme Commander-in-Chief Vladimir Putin has ordered a comprehensive surprise combat readiness test of the entire personnel of the Central Military District, Defense Minister Sergei Shoigu announced at a conference at the Defense Ministry on Saturday. "In line with [Putin's] orders, the Central Military District’s troops and also units and garrisons deployed on its territory have been put on full combat alert since 11:00 am today," he said.

The troops will then be deployed at ranges and conduct exercises in line with their intended purpose, he said, Interfax reports.


Russia Reignites The Proxy War: Putin Offers "Complete Support" To Iraq Prime Minister Scorned By Obama
Tyler Durden on 06/20/2014 20:50 -0400

Two days ago, before it was formalized that the US tacitly, if not explicitly, now supports the removal of the Iraqi Prime Minister whom it itself had helped elect, we summarized the geopolitical tensions and "national interests" in Iraq, which is shaping up to be a proxy war that makes last year’s Syrian escapade pale by comparison, as follows:

· The situation in Iraq, already a jumble of domestic sectarian violence, is now pitting virtually all major (and regional) international players against each other as well. There is:

· US which tacitly supports Iran intervention in the region, but may have suddenly cooled in its support of Maliki despite sending naval and troop forces in the country after partially evacuating its embassy

· Saudi Arabia which wants to remain friendly with the US but is antagonistic to the Iraq regime, is potentially aiding the ISIS forces, and clearly refuses to allow Iran entrance in Iraq

· Iran, which has suddenly become America’s best friend in the region, which is willing to enter Iraq and protect its holy sites

· Syria, whose president is sitting back amused at last year’s failed campaign by the US to remove him from power, and whose army is at a stalemate with the local US-armed and funded rebels

· Qatar, which is supporting the Syrian rebels, but so far has not made its stance clear on Iraq. Like Saudi, it too may be indirectly backing ISIS

· Jordan, which is a close friend the US, and which may have hosted ISIS in a secret base on its territory with the US instructing the jihadist group according to an unconfirmed report

· Turkey, which is on constant alert to Kurdish escalation across the border, the same Kurds which now have far more leverage courtesy of ISIS crushing the Iraq army in the north and handing over Kurds access to oil fields in the north.


Posted at 9:45 PM (CST) by & filed under Jim's Mailbox.


Watch what they do, not do what they say.

CIGA Perry


Antonis Samaras, the Greek prime minister, echoed Mr Li’s remarks on Friday as the two men inaugurated a 17km rail link from a Chinese-controlled container operation at Piraeus port to the main line connecting Greece with the Balkans and central Europe.

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