In The News Today

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The Roman Republic fell, not because of the ambition of Caesar or Augustus, but because it had already long ceased to be in any real sense a republic at all. When the sturdy Roman plebeian, who lived by his own labor, who voted without reward according to his own convictions, and who with his fellows formed in war the terrible Roman legion, had been changed into an idle creature who craved nothing in life save the gratification of a thirst for vapid excitement, who was fed by the state, and directly or indirectly sold his vote to the highest bidder, then the end of the republic was at hand, and nothing could save it. The laws were the same as they had been, but the people behind the laws had changed, and so the laws counted for nothing.
–Teddy Roosevelt

 

Jim Sinclair’s Commentary

When I was a kid this was true!

"No one can afford to be sick anymore. At $15.00 a day in the hospital, it’s too rich for my blood."

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Jim Sinclair’s Commentary

Welcome to Arab Spring, the disaster of the century.

Six army battalions called up under emergency orders to meet growing threat on Egypt, Syria borders
Knesset approves IDF request to call up a further 16 battalions if needed
By Aaron Kalman May 2, 2012, 3:13 pm Updated: May 2, 2012, 7:53 pm

The IDF has issued emergency call up orders to six reserve battalions in light of new dangers on the Egyptian and Syrian borders. And the Knesset has given the IDF permission to summon a further 16 reserve battalions if necessary, Israeli media reported on Wednesday.

An IDF spokesperson said intelligence assessments called for the deployment of more soldiers.

According to 2008′s Reserve Duty Law, combat soldiers can be called for active reserve duty once every three years, and for short training sessions during the other two. Rising tensions between Israel and Egypt and the ongoing unrest in Syria caused the army to ask the Knesset for special permission to call up more soldiers, more often.

The Foreign Affairs and Defense Committee approved the request recently, enabling the IDF to summon up to 22 battalions for active duty for the second time in three years. Already, the army has called up six of them.

“This signifies that the IDF regards the Egyptian and Syrian borders as the potential source of a greater threat than in the past,” the former deputy chief of staff, Dan Harel, said on Wednesday night.

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Jim Sinclair’s Commentary

Fitch better be careful. You know what happened to the last credit agency in the US that dared question the US credit rating.

Fitch warns US growth poses credit threat
By Michael Mackenzie in New York

The credit quality of companies is threatened by the uncertain trajectory of the US economy in the coming years, according to a report by Fitch Ratings.

Wednesday’s warning comes at a time when appetite among investors for corporate debt at historically low yields has been strong, with record debt sales in the first quarter of 2012. The average yield on the Barclays US corporate index fell to a record low of 3.26 per cent in March and remains just above that level.

Powering the decline in corporate bond yields has been aggressive policy actions from the Federal Reserve. The injection of liquidity into the financial system via two rounds of quantitative easing in 2009 and 2010, and the central bank’s pledge to maintain near zero overnight interest rates through to at least the end of 2014, has boosted the appeal of owning corporate debt.

Investors have sold lower-yielding Treasuries and sought riskier securities such as corporate debt and equities, bolstered by S&P 500 companies posting record earnings in 2011. Analysts expected higher earnings for 2012 as companies focused on cutting costs and improving the quality of their balance sheets.

But the lacklustre US economic recovery, marked by high unemployment and declining house prices since the recession officially ended in 2009, poses a threat to long-term credit ratings, argued Fitch.

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Jim Sinclair’s Commentary

Just so you do not forget, the following video is regarding the decline of the dollar settlement mechanism.

 

Jim Sinclair’s Commentary

QE to Infinity is assured.

Factory Orders Post Biggest Decline in Three Years
Published: Wednesday, 2 May 2012 | 10:09 AM ET

New orders for U.S. factory goods in March recorded their biggest decline in three years as demand for transportation equipment and a range of other goods slumped, government data showed on Wednesday.

The Commerce Department said orders for manufactured goods dropped 1.5 percent after a revised 1.1 percent rise in February.

Economists had forecast orders falling 1.6 percent after a previously reported 1.3 percent increase in February.

While the report showed broad weakness in March in a sector that has carried the economic recovery, anecdotal evidence suggests factories continued to expand as the second quarter started.

The Institute for Supply Management’s index of national manufacturing activity climbed to a 10-month high in April, with a measure of new orders received by factories the highest in a year, data showed on Tuesday.

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