Jim’s Mailbox

Posted at 12:02 PM (CST) by & filed under Jim's Mailbox.

Dear Jim,

I appreciate your steady hand on the tiller. Here’s a little advice for those who are feeling a little queasy about the rough gold market. Focusing on the destination works equally well when confronted with either rough seas or rough markets

Watch the horizon.

People who are prone to sea sickness keep their eyes on the horizon. By focusing on the horizon you can maintain your equilibrium more easily. This reduces the number of confusing signals sent to the brain about the state of the body.



Dear Jim,

With just about a week of trading left in 2012, Gold in Euro terms could end up negative for the first time in 11 years after making new highs some 3 months ago.

I hear CIGAs living in the Eurozone whining all around me, with friends and family thinking about cashing out their coins "while there is still a profit in them"

I am probably both young (31) and not an expert in markets, but I am fully aware of our current Western world situation.

The following serves no other purpose than to introduce my question as candidly as I can.

You have shown us recently, using technical analysis, that the Euro is currently on an up-trend against the US Dollar, and that you expect the Euro to "outpace the dollar for the significant future".

On the interview you gave to James Turk at the 2011 GATA conference (right after Gold passed USD 1664!), you said that the USD as a reserve currency was "going to transmit its problems throughout the Western world", and later that "the trading that will take place between the Euro and the Dollar are purely mirror images reflecting what the flavour of the day is".

Also, you keep on reminding all CIGAs of the 3rd illustration of the skier, where you have exposed both currencies as "weak US Dollar" and "violent Euro" respectively.

Finally, the past 5 years and 2012 in particular have more than once proved you right in saying "Whatever is required, where ever it is required, be that Euroland or anywhere in the Western Financial world, will be provided".

Taking all of the above into account, I would conclude that your overall view on Gold in Euro terms is just as bullish as in US Dollar terms.

If 0.72 on the USDX is to become the top for the USD in the future, the Euro would probably trade at 1.40 to the USD (am I too conservative?).

Gold going to and through USD 3500 therefore means Gold going to and through EUR 2500 on the same set of assumptions.

The question now: could we agree the above proposition is valid and is a Golden Truth for all desperate CIGAs living in the Eurozone in 2013 and beyond?

Many thanks for what you do for all of us Jim. Your wisdom and moral qualities are examples for all to follow.

CIGA Pierrafeu
("Flintstones" in French)

Dear Barney Rubble,

The question now: could we agree the above proposition is valid and is a Golden Truth for all desperate CIGAs living in the Eurozone in 2013 and beyond?

What you have quoted in your emails is the Golden Truth. What is happening now is the Great Train robbery whereby the Goldmans of this world will take a huge long position in gold under the beard of manipulation and control of popular gold guys plus financial TV.

Please tell our Euroland friends to simply hunker down because this is as much of a passing cloud as was every single reaction since $248. Once these blackards take all the CIGA gold they can get, we are off to $3500 and above. This is not something I think. This is something I know.



Jim Sinclair’s Commentary

Before you scream foul please think about what Dean is saying here.


I’ve been saying that they have been transferring the control of Gold to the bloc Nations (China/Russia) for some time now; however, is anyone wondering why? Every system these elitists have come up with i.e. socialism, communism, capitalism, have all been global experiments leading to one final end -despotism.

In their mind the capitalism experiment is pretty much over and trust me we are now well on our way to a worldwide socialist/communist system which they have determined to be the best platform from which to spring their despot.

You can take it to the bank that whenever they finally do pull the global plug on all this it will only be because they are (rightfully or wrongfully) confident that their despotism is pretty much solidly assured.

Imagining that any other kind of infrastructure is on their table or in the works is simply put… naievity.

I am definitely not saying nor implying they will be successful in their endeavor because I firmly believe they will fail and something as of yet unknown will occur to upset their applecart (could be Mother Nature); however, I am definitely saying that despotism is their end game objective and transferring the “gold power” to the historically established socialist/communist Nations is just a part of their plan since that is the platform from when their despotism will spring.



I have taken a rather long intermission from posts, but that was to look into a few things. For the moment, I am astounded by what I see from the FRB’s list of MBS purchases from QE1.

There is something so peculiar about the CUSIPs. From what I can dig up, the largest FRB MBS purchases seem to also have an international ISIN to them that were issued back in the 1980s! For instance,

· The original issue for CUSP 01F042637 was back in 1982 for $611 million.

· In QE1 2009, the FRB purchased this Fannie bond CUSIP for $45.825 BILLION from multiple largest banks. Such large bonds are rare, unusual.

· In March 2012, this same CUSIP was issued for $448 MILLION. My understanding is that the CUSIPS are unique with each issue. From $46 billion to half a billion?

· Further, the bond is not among the FRB’s current MBS holdlings – nor any of the largest bonds accounting for bulk of the FRB’s QE 1 purchases.

My goodness, that would make QE1 largely a cover for naked CDS settlement.

Would you know of some websites that allow for CUSIP lookups? These do not show up at the Fannie Mae pool lookup. One firm clammed up when I asked for information on a few of these CUSIPs – why?

My next post, hopefully in the next few days, will be on these issues and the dollar liquidity swaps.



QE has nothing to do with employment. It is a rescue for the cartoon balance sheets of financial organizations allowed by the capitulation of FASB, the supposed gate keepers of all auditing.



Dear Jim,

The indicators technically are at the same levels as 2008. A trigger to reverse course is very near.

Sharks are buying at big discounts and bargain hunting time is here. I’m sure the extremes will work on both sides.

CIGA Luis Ahlborn Sequeira


Dear Jim,

This is nothing new, but Gold should be reclassified for use as collateral at 100% value.

Maybe we should remind people why the big sharks are stealing Gold and using this tactics to scare the public.

Article link in Part 2

FDIC has accepted the Basil III recommendation that Gold should be reclassified for use as collateral at 100% value.

CIGA Luis Ahlborn Sequeira


Jim Sinclair’s Commentary

Have faith. The following chart is graciously credited to Ed Steer’s daily.



Dear Jim,

This is pretty significant if you ask me! Many thought it wouldn’t be used as a monetary metal.

“Starting with the history of metals as money…The clock is ticking”
Posted on December 19, 2012 by maxkeiser

Well aren’t these fine.

It seems 2012 is not yet done with its surprises. The Central Bank of Russia has issued three values of bullion (300,000 31.1g silver pieces with a 3RUB face value, 300,000 7.78g gold pieces with 50RUB face, & 100,000 15.55g gold pieces with a 100RUB face value) that can be used as legal tender beginning, well, TWO DAYS AGO!


Dear David,

If these silver and gold pieces are considered legal tender by a major nation then this is as meaningful as it gets. It might explain the strange constructed events in the gold market of the last two months.