In The News Today

Posted at 3:31 PM (CST) by & filed under In The News.

An observation of the mercurial manipulation of the paper gold price and our need to stop whining and start pushing back:

If tonight there were 1,366 millionaires who would purchase Comex gold contracts and take delivery of that value of gold, the manipulation would end.

Note the gold Bank Hammer that hit as the Comex gang were just ending their morning naked Wicca services.

 

Jim Sinclair’s Commentary 

Who said things are far worse internationally than in the good ole USA? 

GM Oct. sales fall nearly half; Ford drops 30 pct.
Monday November 3, 2:26 pm ET
By Tom Krisher and Bree Fowler, AP Auto Writers 

GM’s US sales plunge 45 pct., Ford down 30 pct.; industry could have worst month in 25 years

DETROIT (AP) — General Motors’ October U.S. sales plunged 45 percent and Ford’s dropped 30 percent, as low consumer confidence and tight credit combined to scare customers away from showrooms. 

The results released Monday — along with a 23 percent drop at Toyota and a 25 percent decline at Honda — are strong indications that sales for the industry as a whole may perhaps be the worst in 25 years.

Detroit-based General Motors Corp. said its light trucks sales tumbled 51 percent compared with the same month last year, while demand for passenger cars fell 34 percent. 

The results were less severe at Ford Motor Co., which said its Ford, Lincoln and Mercury car sales were off 27 percent, while light truck sales for the three brands were down more than 30 percent.

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Sacked Lehman Brothers Bank Employees Blockade Head Office

Dear Friends,

This is the oxymoron of the century and a formula for a very weak dollar and hyper-inflation in the midst of ugly business conditions. All of this will become evident quite soon, probably after Christmas.

The Fed as a central bank to the world
Jacqueline Thorpe, Financial Post
Published:Sunday, November 02, 2008

Nicolas Sarkozy may be pushing for a new financial order but Federal Reserve Chairman Ben Bernanke and U.S. Treasury Secretary Henry Paulson have beaten him to it.

While the French President dreams of global economic cooperation ahead of the G20 summit in Washington, the Fed is quietly becoming central bank to the world, backed by the full might of the U.S. Treasury and a teflon-coated greenback.

Last week saw a new program added to the barrage of bailouts, backstops and stimuli announced by the United States — US$30-billion currency swap lines for Brazil, Mexico, South Korea and Singapore. This is on top of the unlimited supply of greenbacks the United States has provided to the major economies.

The United States will swap wons for greenbacks, allowing South Korean banks to fulfill local demand for U.S. dollars, which had been starved by the freeze-up in the inter-bank lending markets. Banks can then provide those greenbacks to their local customers to allow them to carry out international business.

In April, South Korea will swap its wons back, for a fee of course. David Rosenberg, chief North American economist at Merrill Lynch was quick to pick up on the irony. “The U.S. was supposedly the basket case nation with the massive deficits whose currency was destined to lose its reserve status and whose credit rating was going to get cut at some point,” he said in a note last week. “It is the U.S. that is being called upon to provide unlimited swap lines with Europe one day, and funding for emerging markets the next.”

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Currency Swap:

A swap that involves the exchange of one currency (e.g., US dollars) for another (e.g., Japanese yen) on a specified schedule.
www.cftc.gov/educationcenter/glossary/glossary_co.html

Jim Sinclair’s Commentary

Swaps may be dated for maturity by mutual agreement between parties. I sense that these swaps now financing the planet are from the Fed through the bouquet of perma-swaps in the form of 28 day perma-loans at the Begging Bowl Loan Window.

Jim Sinclair’s Commentary

No problem, just call the Fed and they will make good on a perma 28 day loan.

Citi says credit card losses may rise through 2009
Bank suffers $1.4 billion hit from card-backed assets in latest quarter
By Greg Morcroft, MarketWatch
Last update: 1:44 p.m. EST Nov. 2, 2008

NEW YORK (MarketWatch) — Citigroup said that it lost $1.4 billion in the third quarter from credit card securitizations and that it expects such losses will continue, possibly reaching record levels in 2009.

The result compared to a gain of $169 million from credit card securitizations in the year-earlier period.

“Credit card losses may continue to rise well into 2009, and it is possible that the company’s loss rates may exceed their historical peaks,” the banking giant said in its filing with the Securities and Exchange Commission late Friday.

Citi (C:13.77, +0.12, +0.9%) also said it added $3.9 billion to overall credit reserves, including $2.3 billion for its North American consumer business and $855 million for consumer business outside the U.S.

Citi said the additional reserve to the North American segment was mostly due to a weakening of leading credit indicators, including higher delinquencies on first mortgages, unsecured personal loans, credit cards and auto loans.

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Jim Sinclair’s Commentary

Do it soon or lose the opportunity soon.

Physical Certificates Take a Step Closer to Extinction
by Edward C. Kelleher

The Depository Trust Company, (DTC), a DTCC subsidiary, has announced it will no longer issue physical certificates for withdrawals-by-transfer (WTs) for more than 5,500 issues beginning January 1, 2009.

DTC plans to eliminate WTs of physical certificates for all issues that participate in DTCs Direct Registration System (DRS). Instead, DTC will process these WTs in DRS statement form. This change is pending approval by the Securities and Exchange Commission (SEC). (About 1,550 additional issues are eligible for, but not participating in, DRS and do not offer the investor the opportunity to receive a DRS statement.)

If permitted by an issuer, investors may take their DRS statement to their transfer agent and exchange it for a physical certificate.

DTCs DRS is a book-entry system that enables investors to register their shares electronically with the issuing company or its transfer agents. Instead of a paper certificate, investors receive a statement of their holdings. In 2008, all the major and regional exchanges in the United States mandated that DRS become a listing requirement for all issues. (DTC is the only registered clearing agency operating a DRS.)

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Jim Sinclair’s Commentary

Now that we know there is a serious situation due to the decline of gold reserves without any present relief in the inventory of the majors, please consider the following article.

Mining consolidation anticipated
Peter Koven, Financial Post
Published:Sunday, November 02, 2008

Since mining industry share prices began their historic collapse several weeks ago, investors have wondered when the inevitable consolidation will begin.

According to law firm Fasken Martineau, it is only a matter of time before it gets underway. However, this round of consolidation will look nothing like the last one, and it will not be led by the large companies like Xstrata PLC that dominated the last cycle.

In a presentation to mining industry insiders late last week, Fasken partner Greg Ho Yuen advanced the theory that the intermediate companies will be the ones that kickstart a new wave of acquisitions rather than the senior companies.

The reason is that the sudden fall in commodity prices is forcing the majors to take time to re-evaluate all of the multi-billion-dollar mine developments they were planning. The more nimble intermediate producers will be able to take advantage of the weak markets faster to buy up distressed juniors.

“Because intermediates are smaller and more focused on a few projects, their period of self-evaluation will have either been completed or can be completed very quickly,” Mr. Ho Yuen said in an interview.

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Jim Sinclair’s Commentary

Come on, the drone did it, not the US!

Pakistan Warns U.S. Against Further Airstrikes on Tribal Areas
By Candace Rondeaux
Monday, November 3, 2008; 10:40 AM

ISLAMABAD, Nov. 3 — Pakistan’s defense minister cautioned the newly appointed head of the U.S. Central Command on Monday that launching further missile strikes in the country’s troubled tribal areas could increase tensions between the two countries.

Pakistani Defense Minister Chaudhry Ahmad Mukhtar issued the blunt warning to Gen. David H. Petraeus during his first official visit to Pakistan as head of the U.S. war in neighboring Afghanistan. Mukhtar, who also called for more coordination between the U.S. and Pakistani militaries, said the recent increase in U.S.-led cross-border strikes had created “bad blood” between the two allies. On Friday, 27 people were killed in two separate U.S. airstrikes in northwest Pakistan.

The Pakistani Defense Ministry said in a statement released shortly after the meeting that frequent attacks inside Pakistan by U.S. Predator drones “could generate anti-American sentiments” and “create outrage and uproar” among Pakistanis.

Petraeus, who took charge of the wars in Afghanistan and Iraq on Friday, and U.S. Assistant Secretary of State Richard A. Boucher met with Mukhtar and Pakistan’s top military officer, Gen. Ashfaq Kayani. It was part of the first leg of a tour that is expected to include a visit soon to Afghanistan.

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Jim Sinclair’s Commentary

Look for fiscal stimulation next. How about a new Roosevelt CCC?

Worst job losses since March 2003 predicted
Jobs, manufacturing, credit data to be released
By Ruth Mantell, MarketWatch
Last update: 12:01 a.m. EDT Nov. 2, 2008

WASHINGTON (MarketWatch) — Retailers may not be so merry as this holiday shopping season gets underway.

Consumer confidence hit an all-time low in October, buried under heap after heap of dismal financial and economic news. Worried consumers aren’t going to be rushing into stores or splurging on holiday gifts.

In recent days, data have shown that U.S. consumer spending in September was down 0.4% on a year-over-year basis, the first such drop since the recession of 1991. And it turns out that the U.S. economy contracted at a 0.3% annualized rate in the third quarter, as consumer spending declined at the fastest rate in 28 years.

Why such worry? On top of watching their retirement savings dwindle and foreclosure notices rise, reports about mass layoffs keep rolling in. With weekly initial claims for state jobless benefits hugging the half million mark, a bottom of the labor market doesn’t appear to be in sight.

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