In The News Today

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Jim Sinclair’s Commentary

The latest from John Williams’

– Fed Is Trapped In the End Game for the U.S. Dollar
– Panic of 2008 Still Is Playing Out
– Hyperinflation Forecast Remains in Place

"No. 559: Hyperinflation Update, FOMC"

Jim Sinclair’s Commentary

"The Great Leveling" August 2014 through 2015.



Jim Sinclair’s Commentary

The process of the emancipation of physical gold from paper gold as the price determining medium, globally.

Gold Deliveries From Shanghai Bourse Jump on Physical Demand
By Bloomberg News – Jul 15, 2013 3:43 AM MT

Physical gold delivered to buyers by China’s largest bullion bourse in the first half of this year almost matched the entire amount taken from its vaults in 2012, and was more than double the country’s annual production.

The Shanghai Gold Exchange supplied 1,098 metric tons in the six months through June, compared with 1,139 tons for the whole of last year, according to data from the bourse today. Output in China, the world’s largest gold producer, reached a record 403 tons last year, according to the China Gold Association.

The surge in deliveries underscores buying interest in China, which may pass India as the largest bullion consumer as early as this year after the government in New Delhi raised import taxes while regulators in Beijing made investing in the metal easier. Miners, smelters and refineries are required to sell gold via the Shanghai bourse, the only state-sanctioned marketplace for spot bullion in China.

“The number shows demand for bullion as an underlying asset in China that investors here remained big buyers of the physical commodity this year,” said Fu Peng, a commodity strategist in Beijing at Galaxy Futures Co, a brokerage controlled by the country’s sovereign wealth fund.

Bullion lost 23 percent last quarter amid speculation that the Federal Reserve would curb its asset-buying program as the U.S. economy recovers. Bullion may drop to $1,050 an ounce over 12 months as demand for the metal as a safe haven wanes, UBS AG said on July 4. Citigroup lowered its 2013 gold estimate to $1,358 an ounce.


Jim Sinclair’s Commentary

The talking heads are as angry as the dickens because they all predicted Taper.

Fed recoils from 1937 tightening error as jobs evaporate
The American economy has shed 347,000 jobs over the past two months, roughly comparable with the rate of loss seen during the Great Recession. It is remarkable that the US Federal Reserve should even have been thinking of phasing out life-support in such circumstances.
By Ambrose Evans-Pritchard
9:00PM BST 18 Sep 2013

The Fed’s tough talk has already led to a 140 basis point rise in US 10-year Treasury yields, the benchmark price money for US mortgages and for the world (ex-China). It might as well have raised rates six times.

The shock decision on Wednesday night to put off tapering bond purchases is a recognition of what should have been obvious. Rising mortgage costs and the "tightening of financial conditions" could slow growth, it said. Indeed.

The net loss of jobs over the summer months has been entirely among men, mostly aged 25 to 54 and university educated. The cohort aged over 55 has been growing, so this is not happening because baby boomers are retiring early and happy to grow cantaloupes in Arkansas, or to play golf at Torrey Pines.

The labour "participation rate" dropped to 63.2pc in July, the lowest level since the late 1970s. The rate for men is at an all-time low. The unemployment rate has been falling, but chiefly because so many people are giving up hope and dropping off the rolls.

Some Fed governors seem to want to wash their hands of this, latching on to theories that the problem is "structural": due to evolving technology, or a "skills mismatch", or that catch-all concept "demographics". No doubt this is half true, but such claims were made in the early 1980s when jobs were scarce. The unemployed were decried as "shirkers" by the Chicago Tribune in the 1930s.