Jim Sinclair’s Commentary
Bag of worms?
Bombshell: Federal judge suddenly green-lights lawsuit that could stop Obamacare in its tracks
By David Martosko, U.s. Political Editor
PUBLISHED: 14:27 EST, 22 October 2013 | UPDATED: 15:05 EST, 22 October 2013
A federal judge on Tuesday refused to dismiss a case that could fatally cripple the Obamacare health insurance law.
The Affordable Care Act forbids the federal government from enforcing the law in any state that opted out of setting up its own health care exchange, according to a group of small businesses whose lawsuit got a key hearing Monday in federal court.
The Obama administration, according to their lawsuit, has ignored that language in the law, enforcing all of its provisions even in states where the federal government is operating the insurance marketplaces on the error-plagued Healthcare.gov website.
Thirty-six states chose not to set up their exchanges, a move that effectively froze Washington, D.C. out of the authority to pay subsidies and other pot-sweeteners to convince citizens in those states to buy medical insurance.
But the IRS overstepped its authority by paying subsidies in those states anyway, say the businesses and their lawyers.
Jim Sinclair’s Commentary
The "Great Leveling" is certainly coming before the "Great Reset.".
Economist Caution: Prepare For ‘Massive Wealth Destruction’
Friday, 25 Oct 2013 05:35 PM
Take immediate steps to protect your wealth . . . NOW!
That’s exactly what many well-respected economists, billionaires, and noted authors are telling you to do — experts such as Marc Faber, Peter Schiff, Donald Trump, and Robert Wiedemer. According to them, we are on the verge of another recession, and this one will be far worse than what we experienced during the last financial crisis.
Marc Faber, the noted Swiss economist and investor, has voiced his concerns for the U.S. economy numerous times during recent media appearances, stating, “I think somewhere down the line we will have a massive wealth destruction. I would say that well-to-do people may lose up to 50 percent of their total wealth.”
When he was asked what sort of odds he put on a global recession happening, the economist famous for his ominous predictions quickly answered . . . “100 percent.”
Faber points out that this bleak outlook stems directly from Federal Reserve Chairman Ben Bernanke’s policy decisions, and the continuous printing of new money, referred to as “quantitative easing” in the media.
Israel issues warning on report on Iran bomb
Oren Dorell, USA TODAY 7:17 p.m. EDT October 25, 2013
A new report that says Iran may need as little as a month to produce enough uranium for a nuclear bomb is further evidence for why Israel will take military action before that happens, an Israeli defense official said Friday.
"We have made it crystal clear – in all possible forums, that Israel will not stand by and watch Iran develop weaponry that will put us, the entire Middle East and eventually the world, under an Iranian umbrella of terror," Danny Danon, Israel’s deputy defense minister told USA TODAY.
Iran is developing and installing new and advanced centrifuges that enable Iran to enrich even low-enriched uranium to weapons grade uranium needed for nuclear weapons within weeks, Danon said.
"This speedy enrichment capability will make timely detection and effective response to an Iranian nuclear breakout increasingly difficult," he said.
"Breakout" refers to the time needed to convert low-enriched uranium to weapons-grade uranium. On Thursday, the Institute for Science and International Security issued a report stating that Iran could reach that breakout in as little as one month based in part on Iran’s own revelations about its nuclear program.
A Piece of the Gold Puzzle Falls into Place
Wednesday, October 23, 2013
2013 has been the year that China has lit the physical gold market on fire; however you would never know from the metal’s price performance. While the price of gold has fallen more than 20%, bullion flow to the East has been nothing short of spectacular. Recently published data supports our presumption that physical gold was indeed flowing from ETF liquidations with a significant amount heading East.
We have written much this year on the gold market and the flow of the yellow metal to China. A quick review of the titles of our missives highlights our fascination with gold market developments over the past year. Many of these articles outline the massive shift in the gold trade from West to East. But it was in our piece entitled “Redemptions in the GLD are, oddly enough, Bullish for Gold” where we first postulated that elevated premiums for gold in China, the so-called ‘Shanghai premium’, were driving redemptions in the world’s largest gold ETF with the physical gold being used to satiate Asian demand. We asked the question in July, when we wondered what the link between China’s increasing physical gold deliveries and the drop in gold inventories within the COMEX and GLD ETF was, but any proof remained elusive.
Last week we had our first confirmation that the drop in ETF inventory was indeed tied to Chinese physical buying; in fact they were joined-at-the-hip. UK gold exports to Switzerland, Europe’s major bullion refining hub, jumped to 1,016.3 tonnes in the first eight months of this year from 85.1 tonnes over the same period in 2012. This is a staggering increase. Over the same period, investor withdrawals from gold ETFs, have totalled nearly 670 tonnes according to data from Bloomberg. And can you guess the location of their vaults? The world’s largest gold ETF, New York-listed SPDR Gold Shares, stores its gold holdings in HSBC’s London vault, as do other leading ETF operators such as ETF Securities.1 Further, the UK has no commercial-scale gold mines, but London is the centre of the global gold market, with bankers estimating that some 10,000 tonnes are held in the city’s vaults, including at the Bank of England, largely by investors and central banks.2 This is the perfect locale to find a significant mass of gold in a short period of time. Following the path of this gold, we find that the two largest exporters of gold to Hong Kong this year have been Switzerland and the United States. From these statistics it is clear that physical gold was redeemed out of the largest ETF’s, shipped to Switzerland for vaulting or refining purposes with a significant portion sent on to Hong Kong for Chinese consumption.
In May of this year, we calculated that more than one third of China’s import growth has been driven solely from its citizens’ desire to own gold and not from a growing domestic economy. Recent trade data suggests that this trend has not abated. Of course this begs the question to what end is China importing this large amount of gold? Inflation protection for its citizens? Backing their currency with gold? Deploying their immense foreign exchange reserves into a currency that is no other’s obligation? These are all possible explanations.
Jim Sinclair’s Commentary
Not dollar positive
Jim Sinclair’s Commentary
QE to infinity. Taper into the trash can.
Central Banks Drop Tightening Talk as Easy Money Goes On
By Simon Kennedy & Jeff Kearns – Oct 24, 2013 11:05 AM M
The era of easy money is shaping up to keep going into 2014.
The Bank of Canada’s dropping of language about the need for future interest-rate increases and today’s decisions by central banks in Norway, Sweden and the Philippines to leave their rates on hold unite them with counterparts in reinforcing rather than retracting loose monetary policy. The Federal Reserve delayed a pullback in asset purchases, while emerging markets from Hungary to Chile (CHOVCHOV) cut borrowing costs in the past two months.
“We are at the cusp of another round of global monetary easing,” said Joachim Fels, co-chief global economist at Morgan Stanley in London.
Policy makers are reacting to another cooling of global growth, led this time by weakening in developing nations while inflation and job growth remain stagnant in much of the industrial world. The risk is that continued stimulus will inflate asset bubbles central bankers will have to deal with later. Already, talk of unsustainable home-price increases is spreading from Germany to New Zealand, while the MSCI World Index of developed-world stock markets is near its highest level since 2007.
“We are undoubtedly seeing these central bankers go wild,” said Richard Gilhooly, an interest-rate strategist at TD Securities Inc. in New York. They “are just pumping liquidity hand over fist and promising to keep rates down. It’s not normal.”
Jon Stewart Smacks Down CNBC and Fox Anchors For Defending JP Morgan
October 23, 2013 10:44 PM\
The Daily Show’s Jon Stewart opened up this Wednesday’s show by letting the so-called financial analysts over at CNBC and the Fox Business Channel have it for their concern trolling for poor old JP Morgan Chase.
After playing footage of CNBC’s money honey, Maria Bartiromo, arguing with Salon’s Alex Pareene about how terrible it was that someone was finally going to hold Dimon and his ilk accountable — and Bartiromo and some of her colleagues claiming that he should have been cut some slack because the government supposedly forced them to buy Bear Stearns — Stewart treated his audience to some footage of CNBC’s Jim Cramer, who apparently had a very different view of that deal at the time.
Stewart wrapped things up after the Cramer footage with a sentiment that’s probably shared by a lot of us: "F*ck all y’all."
Gold Stocks Continue Bottoming Pattern
Thursday October 24, 2013 16:39
A month ago we noted that the gold stocks were headed lower and to a potential double bottom that would create another great buying opportunity. After seven straight weeks of price declines, the gold stocks rebounded last week and are off to a good start this week. We can’t be sure if a double bottom or some complex head and shoulders pattern is developing. Regardless of the specific pattern, a bottom seems to be developing and another great buying opportunity could be at hand.
The weekly chart below shows GDX, GDXJ and SIL. We’ve already noted the clear resistance at GDXJ $51 and GDX $31. It appears these markets have at least a few more months of bottoming activity ahead before they can push through that resistance. However, there is near-term upside to be had if the market can rally to that resistance. Meanwhile, the silver stocks as represented by SIL continue to look the strongest. It had the strongest summer rally and it has made a true higher low already.
If we zoom in on GDX we see a few additional positives that bode well for the sector. The three indicators at the bottom are breadth indicators. Breadth can lead price at key turning points. The bullish percent index, smoothed advance decline line and new highs minus new lows indicators are all in a much stronger position compared to the summer bottom. This suggests internal strength is building.
Saudis Anger with US Signals Dollar Sell-Off, NSA Spying Hurts America Abroad, More Banker Fraud
Published on Oct 24, 2013
http://usawatchdog.com/weekly-news-wr… – The Saudis are outraged over how the U.S. is handling the Syrian crisis. The Kingdom is also angry at America’s increasingly cozy relations with Iran. The Saudis are saying a "major shift" is coming in U.S./Saudi relations. This is very big trouble for the U.S. dollar. The NSA even hacked the cell phone of Angela Merkel, the newly re-elected leader of Germany. The NSA is single handedly turning allies into enemies! This, too, is extremely dollar negative. The fraud the banks are committing just keeps piling up with zero criminal prosecutions.