In The News Today

Posted at 7:17 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

The Fed increases QE. The Fed and the Chinese central bank move to more stimulus. The Fed minutes spread the outrageous MOPE that just as they vote to increase QE they really don’t want to. The Fed spokesman speaks about the "To Big to Fail" bank concept.

There is something on the horizon that effort to restrain gold and support the dollar must be systemic. Please note the comment on Russia examining the same situation.

‘Too big to fail’ banks must be broken up – Fed official
Published: 17 January, 2013, 16:36

US "megabanks" with large toxic assets accumulated during the crisis should be split into smaller units, according to a senior Fed official. Thus they won’t be able to use the “too big to fail” excuse to get another government bailout.

"We recommend that TBTF (too-big-to-fail) financial institutions be restructured into multiple business entities," Reuters quotes Richard Fisher, President of the Dallas Federal Reserve Bank.

The Fed official identified 12 "megabanks" with above $250bn in assets that could be classified as “too big to fail”. Among the so-called “behemoth” institutions are JPMorgan Chase, Bank of America, Goldman Sachs, Citigroup and Morgan Stanley.

Under the proposal only the commercial banking could rely on federal help, with such units as insurance or brokerage relying on their own resources. Customers of banking businesses other than commercial would need to sign an official disclaimer, proving they understand the risks. Fisher didn’t specify the exact limits for the size of the banks, saying that would be up to market forces.

“They [huge banks] should completely separate investment banking from commercial banking, that’s the only thing that matters. Otherwise commercial banks are run by hedge funds which is crazy,” agreed Robert Allen, professor of Economic History at Oxford University, talking to Business RT.



Jim Sinclair’s Commentary

It is the small pieces of news that tend to be the most important. Central Banks have no need to test such actions to see what they will do. They know exactly what they will accomplish, and it is both by the Fed and Chinese Central Banks applying more stimulation.

Fed Begins Adding Reserves to System With Repurchase Agreements
By Liz Capo McCormick – Jan 17, 2013 9:49 AM ET

The Federal Reserve Bank of New York said it’s temporarily adding reserves to the banking system with “small-value” repurchase agreements as part of a program to test the central bank’s operational readiness.

The transactions, part of a series of open-market operations began in 2009, don’t represent any change in monetary policy, according to a statement yesterday on the New York Fed’s website. All eligible collateral will be able to be used in the transactions, which will be conducted with the central bank’s 21 primary dealers.

In June 2012, the Federal Open Market Committee authorized the New York Fed to undertake repos and outright purchases and sales of securities, in addition to reverse repos, for testing. The Fed did its first round of repo testing in August 2012.

Prior to that transaction, the Fed hadn’t conducted a repo since Dec. 30, 2008. Since then, the New York Fed has added six primary dealers, the firms that act as counterparties to the central bank.

In repos, the Fed buys U.S. Treasury, mortgage-backed and so-called agency debt from dealers for a set period, temporarily raising the amount of money available in the banking system. At maturity, the securities are returned to the dealers, and the cash to the Fed.


Jim Sinclair’s Commentary

The answer is somewhere in the middle closer to this opinion.

The shale oil miracle hit all MSM outlets three weeks before the election at a level that has to be viewed as hype.

Oil Guru Destroys All Of The Hype About America’s Energy Boom

Berman argues the promise of America’s shale revolution is "magical thinking." Shale drilling is too expensive and too ephemeral to make a lasting impact.



Jim Sinclair’s Commentary

The newest thing is safe style.

Stealth Hoodie Hides Wearer From Drones
Jan 18, 2013 02:38 PM ET // by Jesse Emspak

Surveillance cameras are ubiquitous, especially in the U.K.. and in the United States, Congress has already approved the use of drones for domestic surveillance. Then there’s the “Stingray” tool used by the FBI to track cell phones. It’s enough to make even those who’ve gotten nothing hide feel nervous.

New York-based artist Adam Harvey doesn’t like it one bit. So he’s taken it upon himself to design anti-surveillance clothing to foil government snoopers.

Harvey has been looking at the effects of such surveillance on culture for some time. Last year he designed a kind of face makeup called CVDazzle to avert face-recognition software.

In the spirit of fooling cameras – and messing with surveillance – Harvey has now come out in a set of hoodies and scarves that block thermal radiation from the infrared scanners drones use. Wearing the fabric would make that part of the body look black to a drone, so the image would appear like disembodied legs. He also designed a pouch for cell phones that shields them from trackers by blocking the radio signals the phone emits. For those airport X-ray machines, he has a shirt with a printed design that blocks the radiation from one’s heart.

The materials the clothes are made are specialized and expensive, so these aren’t the kinds of fashions that the local discount store will have – at least not yet. Harvey does plan to offer the clothes for sale, though.