Posts Categorized: In The News

Posted by & filed under In The News.

Dear Friends,

I suggest this article below be put on your bulletin board where you track the most serious trends in geopolitical events. Between now and 2012 Pakistan packs the punch. Israel makes an error in judgement and Turkey is victimized.

Newfound Riches Come With Spiritual Costs for Turkey’s Religious Merchants
Published: December 25, 2008


Ferhan Kadiroglu played with her 3-year-old daughter, Ayse, in their Istanbul home. Their family is part of Turkey’s powerful new class of wealthy Muslims.

ISTANBUL — Turkey’s religious businessmen spent years building empires on curtains, candy bars and couches. But as observant Muslims in one of the world’s most self-consciously secular states, they were never accepted by elite society.

Now that group has become its own elite, and Turkey, a more openly religious country. It has lifted an Islamic-inspired political party to power and helped make Turkey the seventh largest economy in Europe.

And while other Muslim societies are wrestling with radicals, Turkey’s religious merchant class is struggling instead with riches.

“Muslims here used to be tested by poverty,” said Sehminur Aydin, an observant Muslim businesswoman and the daughter of a manufacturing magnate. “Now they’re being tested by wealth.”

Some say religious Turks are failing that test, and they see the recent economic crisis as a lesson for those who indulged in the worst excesses of consumption, summed up in the work of one Turkish interior designer: a bathroom with faucets encrusted with Swarovski crystal, a swimming pool in the bedroom, a couch rigged to rise up to the ceiling by remote control during prayer. “I know people who broke their credit cards,” Ms. Aydin said.

But beyond the downturn, no matter how severe, is the reality: the religious wealthy class is powerful now in Turkey, a new phenomenon that poses fresh challenges not only to the old secular elite but to what good Muslims think about themselves.


Posted by & filed under In The News.

Jim Sinclair’s Commentary

Closer and closer we come. There is a political demand for the Indian government to act in order to satisfy the constituency lest an old adversarial party rises once again. The odds favor something dangerous soon.

India, Pakistan: Signs of a Coming War
December 24, 2008 | 2002 GMT

Several major signs of a coming Indian-Pakistani war surfaced Dec. 24.

Indian troops reportedly have deployed to the Barmer district of southwest Rajasthan state along the Indian-Pakistani border. Furthermore, the state government of Rajasthan has ordered residents of its border villages to be prepared for relocation. The decision reportedly came after a meeting among the state’s director-general of police, home secretary and an official from the central government. Stratfor confirmed the report with an Indian army officer.

According to India’s ZeeNews, the Pakistani army replaced the Pakistan Rangers that regularly patrol the border with India. The Pakistani troop movements were later confirmed by U.K. Bansal, the additional director-general of India’s Border Security Force (BSF) in Barmer, Rajasthan.

As Stratfor reported Dec. 22, there is a high probability of India using military force against Pakistan after Dec. 26, when a deadline expires for Pakistan to deliver on Indian demands to crack down on Islamist militant proxies that threaten India. With low expectations that Pakistan has the will or capability to deliver on these demands, India has spent the past month preparing for military action against Pakistan. Pressure is now ratcheting up on both sides of the border, with Indian Air Marshal P.K. Barbora, air officer commanding-in-chief of the Western Air Command, telling reporters Dec. 24 that as many as 5,000 targets in Pakistan have thus far been identified, while saying that many of the militants hiding out in camps in Pakistan-occupied Kashmir have already fled.



Jim Sinclair’s Commentary

Words of war can easily result in a war between two nuclear powers. The problem lies in if the action bogs down, or one party starts to lose.

We’ll defend Pakistan till the last drop of our blood: Zardari
Nirupama Subramanian

ISLAMABAD: A charged debate on national security in the Pakistan parliament’s upper House saw members across party lines express support for the government and the country’s armed forces against “any kind of aggression” by India.

With a well-known international think-tank adding fuel to the fire with information — by its own admission, it was unverified — that India had set a deadline of December 26 for Pakistan to act against militant groups operating in its territory, President Asif Ali Zardari added to the war talk with the pledge that the Pakistani nation would defend itself “till the last drop of our blood.”

Statements by Prime Minister Yusuf Raza Gilani and Interior Ministry head Rehman Malik about the low possibility of war were lost on a day of high rhetoric both in the Senate and in the National Assembly.

Mr. Gilani, speaking in Lahore, said it was his assessment there would be no war between the two countries, even though he said the nation was fully prepared to meet any threat head-on.

Mr. Malik, speaking at a memorial function for Benazir Bhutto in Islamabad, described the leadership of the two countries as “sensible” enough to prevent a war.



Jim Sinclair’s Commentary

If you are in India you might consider leaving for anywhere, now.

The only safe place in India is Prasanthi Niliyam. I feel quite good here in Africa.

If this push does come to shove, do not be complacent in major capitals or commercial centers anywhere.

Surgical strikes’ mean war, senators warn India

ISLAMABAD: The Senate on Wednesday ruled out the possibility of allowing India ‘surgical strikes’ in saying such attacks would be taken as aggression. “Any violation of Pakistani territory would be considered as war and would be repulsed with full force,” Leader of the House Raza Rabbani said while winding up a debate on national security in the Upper House. He rejected reports that US Chiefs of Staff Chairman Michael Mullen had asked Pakistan not to retaliate in case of an Indian strike. “We were neither conveyed such a message by Mullen nor are we ready to accept such advice,” Rabbani said. He dismissed reports of differences between the military and civilian leadership. Rabbani offered India co-operation in the Mumbai probe but said Pakistani citizens would not be handed over to India. zulfiqar ghuman



Jim Sinclair’s Commentary

Anyone seen four horsemen go by? Is there anyone who does not yet understand how pivotal Pakistan is for the world?

Suicide bombers ready to defend Pakistan: TTP
Daily Times, Pakistan – 15 hours ago

Tehreek-e-Taliban Pakistan backed and financed by u.s.a (TTP) chief Baitullah Mehsud said on Wednesday that ‘hundreds of thousands of suicide bombers’ are ready to defend Pakistan in case of war with India. According to a statement, he said, “Despite our differences with the government, the protection of Pakistan and its people is as much our duty as it is of the armed forces.” “The armed forces and the nation do not need to worry about the western borders in case of an Indian attack,” he added.


Pak military, Taliban unite against India
25 Dec 2008, 1044 hrs IST, Indrani Bagchi, TNN

NEW DELHI: “We are all Taliban now’’ is what Pakistanis may soon be saying. With Baitullah Mehsud of the Tehrik-e-Taliban (TTP) openly ranging himself and his suicide fighters on the side of the Pakistan army, the distinction between the army and the jihadi militia has significantly blurred. The danger of ‘Talibanisation’ becoming mainstream in Pakistan is now a proximate reality.

On Tuesday, Mehsud, whose TTP is one of the biggest Taliban terror groups in the Federally Administered Tribal Areas (FATA), offered his bombers to the Pakistan army to fight India. In the immediate aftermath of the Mumbai attacks, Mehsud and Maulana Fazlullah (Tehreek-e-Nafaz-e-Shariat-e-Mohammad) in Swat had both offered their terror groups to “help’’ the Pakistan army.

The aggressive noises against India were designed to signal that they meant business and to extend their appeal beyond the sections which have already embraced them.

In the process, however, the lid may have been blown off the tacit alliance that the Pakistan army was always suspected to have with the Taliban even when the two were fighting in FATA and the North West Frontier Province.


‘Surgical strike’ speculation quashed
By Iftikhar A. Khan

ISLAMABAD, Dec 24: The government ruled out on Wednesday the possibility of allowing India to conduct a ‘surgical strike’ inside Pakistan.

Winding up a discussion on national security in the Senate, Leader of the House, Mian Raza Rabbani, rejected as baseless rumours that US Chief of Staff Michael Mullen had advised Pakistan not to retaliate in case of a strategic strike inside its territory and that Pakistan had agreed to allow a single strike. “We were neither conveyed such a message by Mullen nor are we ready to accept such an advice.”

Senator Rabbani said Pakistan would neither allow a surgical strike nor violation of its airspace or other territorial limits.

He asserted that a surgical strike would be treated as war and repulsed with full force.

He said any attempt to alter the boundaries of the country would be thwarted with the support of the masses. He said the civilian and military leadership, as well as the entire nation, were reading from the same page, singing in the same tune and speaking the same language.


Kayani, the real power wielder in Pakistan
25 Dec 2008, 0000 hrs IST, Indrani Bagchi, TNN

NEW Delhi – Mumbai attacks lifted the veil on what was, until then, a stealthy transformation within Pakistan — the outing of new army chief

Ashfaq Parvez Kayani as the real power in the country, as opposed to the fragile democratic government led by Asif Ali Zardari and Yousuf Raza Gilani.

The first sign came when Pakistani foreign minister Shah Mehmood Qureshi was literally airlifted out of Delhi in the middle of the night, by what Indian officials say was a Pakistan army airplane.

Diplomatic sources said it was Kayani who personally torpedoed the proposal by Gilani to send the DG-ISI to India. He reportedly told a friendly diplomat, "The Indians will be asking for me the next time." It was also Kayani who went on record to state that Pakistan would respond "within minutes" to India. All indications are that the Pakistan army is spoiling for a fight.

When Kayani was made army chief by former president Pervez Musharraf in late 2007, all that was known about him was his reclusive nature, his apolitical bent and that he was a professional soldier and a keen golfer with an 18 handicap.



Jim Sinclair’s Commentary

Christmas spirit in downtown Karachi:

Pakistan Scrambles Fighter Jets After India Says ‘All Options Open’
Washington Post   |  Rama Lakshmi   |   December 23, 2008 05:23 PM

NEW DELHI, Dec. 22 — In signs of growing regional tension since the Mumbai attacks last month, Pakistan scrambled fighter jets over several of its larger cities Monday, and India’s foreign minister told a gathering of Indian diplomats in New Delhi that the country is keeping all its options open to bring the perpetrators of the attacks to justice.

"We have so far acted with utmost restraint," Pranab Mukherjee told the more than 120 envoys from posts around the world. But he added, "We will take all measures necessary as we deem fit to deal with the situation."

A senior government official, who spoke on the condition of anonymity, later called Mukherjee’s tough talk "an expression of political will that India will not take this lying down." He added that the option of "precision airstrikes" on terrorist training camps in Pakistan would remain on the table if Islamabad did not act effectively against groups fomenting terrorism against India.

Pakistan has denied involvement in the Mumbai attacks, which killed more than 170 people and wounded more than 230.


Jim Sinclair’s Commentary

What the banks refuse to tell is a story that will certainly send them all to hell.

Crackdown on bailed out banks
Dec 24, 2008

WASHINGTON – LAWMAKERS are turning up the heat on banks that have received money from the Treasury Department’s $700 billion (S$1 trillion) rescue fund after the Associated Press reported that they wouldn’t say how they are using the money.

Sens Dianne Feinstein and Olympia Snowe said on Tuesday that they will propose legislation next month to force companies that receive money from the fund to report how they have spent it.

The legislation would also prohibit them from spending the taxpayer dollars on lobbying or political contributions. It would also apply to some recipients of the Federal Reserve’s emergency lending programs.

The legislation was introduced earlier this year, but the Senate did not take it up. The sponsors have long said they plan to pursue it when the 111th Congress convenes Jan 6.

‘At present, we don’t know whether these companies are using these funds to fly on private jets, attend lavish conferences or lobby Congress,’ Ms Feinstein, a Democrat, said in a statement.


Posted by & filed under In The News.


Dear CIGAs,

My thanks for the thousands of helicopters sent here. Actually the Fed through the practice of "Quantitative Easing" are now using the Russian heavy lifter helicopters as they are the largest rotorcraft flying. The weight of the 24/7 money drops are putting such a strain on helicopters that a change in name is under consideration. The newest possibility is B-52 or Russian long range bear saturation cluster money bombing internationally. More on this in 09.

Jim Sinclair’s Commentary

Happy New Year.

U.S. debt approaches insolvency; Chinese currency reserves at risk
by Maurizio d’Orlando

In a few months, America’s public debt has grown to more than 100% of GDP. Fear of a valuation crisis for the dollar, with tremendous consequences for Asian countries, major exporters to the United States.
Milan (AsiaNews) – In the United States, the danger of debt insolvency is growing, putting at risk the currency reserves of foreign countries, China chief among them. According to new figures published by Bloomberg in recent days (Nov. 25, 2008 [1]), the American government has employed a total of 8.549 trillion dollars to stop the financial crisis. This means a total of about 24-25.4 trillion dollars of direct or indirect public debt weighing on American taxpayers. The complete tally must also include the debt – about 5-6 trillion dollars – of Fannie Mae and Freddie Mac, which are now quasi-public companies, because 79.9% of their capital is controlled by a public entity, the Federal Housing Finance Agency, which manages them as a public conservatorship.

In 2007, public debt in the United States was 10.6 trillion dollars, compared to a GDP (gross domestic product) of 13.811 trillion dollars. Public debt in 2007 was therefore 76.75% of GDP. In just one year, direct and indirect public debt have grown to more than 100% of GDP, reaching 176.9% to 184.2%. These percentages exclude the debt guaranteed by policies underwritten by AIG, also nationalized, and liabilities for health spending (Medicaid and Medicare) and pensions (Social Security)[2]. By way of comparison, the Maastricht accords require member states of the European Union (EU) to reduce their public debt to no more than 60% of GDP. Again by way of comparison, in one of the EU countries with the largest public debt, Italy, public debt in 2007 was equal to 104% of GDP.

In 2007, 61.82% [3] of America’s public debt was held by foreign investors, most of them Asian. So the U.S. public debt held by nonresident foreigners is equal to about 109.39% (113.86%) of GDP. According to a study by the International Monetary Fund, countries with more than 60% of their public debt held by nonresident foreigners run a high risk of currency crisis and insolvency, or debt default. On the historical level, there are no recent examples of countries with currencies valued at reserve status that have lapsed into public debt insolvency. There are also few or no precedents of such a vast and rapid expansion of public debt.

The United States also runs large deficits in its public balance sheet and balance of trade. Families and businesses are also deeply in debt: in 2007, American private debt was equal to a little more than 100% of GDP. At the moment, it is not clear how much of America’s private debt has been "nationalized" with the recent bailouts.

In the early months of next year, when the official data are published, the United States will run a serious risk of insolvency. This would involve, in the first place, a valuation crisis for the dollar. After this, the United States could face a social crisis like that in Argentina in 2001. A crisis in U.S. public debt would likely have a severe impact on the Asian countries that are the main exporters to the United States, China first among them. Chinese monetary authorities, thanks to a steeply undervalued artificial exchange rate, by about 55%, have limited imports (including food) and have achieved an export surplus. This has allowed them to accumulate a large stockpile of dollar reserves. In a currency crisis, China risks losing much of the value of its accumulated currency reserves. At the same time, pressure on imports (wheat, other grains, and meat) have led to inflation in the prices of food, the most important expenditure for more than 900 million Chinese. This is nothing more than a small confirmation of the recent statements of the pope, in his message for the World Day for Peace, where the pontiff calls the current financial system and its methods "based upon very short-term thinking," without depth and breadth (nos. 10-12), preoccupied with creating wealth from nothing and leading the planet to its current disaster. [4]


Posted by & filed under In The News.

Jim Sinclair’s Commentary

If you have put on your New Year’s resolution list to obtain Paper Certificates for your investments, either personal or IRA, you will be TOO LATE. You have until December 31st to make this request and even that can be declared too late.

How much of the road to protection have you taken?

If you held certain Reserve Fund Money Funds more than your weekend was ruined.

My perfect Christmas present from you would be to know that you have to the fullest degree possible fully protected you and yours.

Make me happy, please. Take your physical certificates while you still can.

Money market funds reel as yields near zero yields
By Deborah Brewster in New York
Published: December 21 2008 19:12 | Last updated: December 21 2008 19:23

Money market funds, an increasingly popular place to park cash, will need to raise fees or close to new money to remain profitable as yields hover at near-zero, according to industry managers.

The funds, which manage $3,800bn and have seen big cash inflows, are reeling from frozen credit markets, subprime exposure and a crisis of confidence triggered by one fund “breaking the buck”, or returning investors less than they paid in.

The US Federal Reserve last week cut its target interest rate to between zero and 0.25 per cent, from one per cent.

Jim McDonald, who runs taxable money market funds for T Rowe Price, said: “You can’t make money in this situation. If short-term interest rates stay where they are, it’s virtually impossible to run a government [bond] fund and make any money. You can close the fund, that’s one option.”

Vanguard last week closed two of its money market funds to institutional investors, while Credit Suisse said it would quit managing money market funds in the US and liquidate $8bn in assets across its three funds.

David Glocke, a portfolio manager at Vanguard, said: “It just doesn’t make any sense to take in money in this environment, it would dilute yields for existing investors.”


Jim Sinclair’s Commentary

Remember this?

Money market funds wait anxiously for rescue by Fed
By Deborah Brewster in New York
Published: November 12 2008 02:00 | Last updated: November 12 2008 02:00

Investors have pulled more than $400bn from money market prime funds in the past two months, leaving the funds waiting urgently for a Federal Reserve rescue plan to help them sell commercial paper to meet redemptions.

The Fed said on Monday that it would begin the rescue plan on November 24, a few weeks later than planned. Money market funds are low-risk, lowreturn fundsthat normally invest heavily in commercial paper, a type of debt used by businesses to meet short-term funding needs.

The funds currently manage a total of $3,600bn (£2,335bn, €2,900bn) and have been struck by high redemptions and illiquid markets, making it difficult for them to sell their paper to pay out investors.

The Fed plan, announced on October 21, will see it buy up to $600bn in certain companies’ short-term debt, as a way to provide liquidity in the credit markets and help money market funds find it easier to sell their commercial paper. Money market funds will be able to sell short-term debt issued by 50 financial institutions to the Fed programme, called the money market investor funding facility.

The Fed said the programme might over time be extended to buy debt from other investors besides money market funds.

A separate Fed programme to buy commercial paper in the markets has already begun operating.



Jim Sinclair’s Commentary

I am hearing this from too many good sources to dismiss the possibility that India will soon move against Pakistan.

Stratfor Geopolitical Diary: Countdown to a Crisis on the Subcontinent

The week began with a series of signals from New Delhi that India’s restraint in taking military action against Pakistan is no longer guaranteed. In fact, such action could very well be imminent.

In a press conference Monday, Foreign Minister Pranab Mukherjee said that while India “has so far acted with utmost restraint,” it will “explore all options” in pressuring Pakistan to deal with Islamist militancy. The same day, Indian media reported that Indian troops and the air force’s Quick Reaction Teams had deployed along the border with Pakistan, with commandos reinforced at airstrips in Jaisalmer and Uttarlai in Rajasthan and Bhuj in Gujarat. The Pakistani military, meanwhile, reportedly went on a heightened state of alert, with reports of air force jets scrambling in Islamabad, Rawalpindi, Lahore and Muzaffarabad, the capital of Pakistan-administered Kashmir.

Over the past few weeks, India has played a complex diplomatic game, issuing a series of statements that seemingly downplayed the likelihood of military action against Pakistan in response to the Nov. 26 Mumbai attacks, while making a point in the public sphere that New Delhi was focused on using diplomatic tools to pressure Islamabad. While New Delhi’s behavior led many to believe that the threat of war had subsided, Stratfor maintained that Indian military operations were being prepared, and that New Delhi’s plan was first to exhaust its diplomatic options before engaging in any kind of military action. India’s restraint, in large part, was attributed to its talks with the United States, which would much rather not see the nuclear-armed rivals come to blows when the Americans are fighting an uphill battle against al Qaeda and Taliban forces in the region.

But time is running out for Pakistan.

Reliable sources -— whose information on this issue cannot be verified at this time -— have told us that in the wake of the Mumbai attacks, New Delhi relayed a message to the Pakistanis via the United States, saying they would be given 30 days to crack down on Islamist militant proxies on Pakistani soil that continue to threaten India. While India used the time to prep its military forces, the United States came down hard on Pakistan behind the scenes, making clear that if Islamabad did not deliver, Washington would not be able to stand in New Delhi’s way if and when the time came for India to act. The Pakistanis carried out a few raids targeting militant leaders and Pakistani intelligence operatives, making a few arrests, but did nothing that substantially reduced the threat to India, from New Delhi’s point of view. And even if Pakistan’s government was prepared to accede to India’s demands in full, it could go only so far in placating New Delhi before its eff orts to avoid an international crisis created a domestic one.



Jim Sinclair’s Commentary

Today in Pakistan:

Pakistan asked to accept responsibility
* WP editorial says ‘Pakistan not acknowledging truth’, ‘excuses must come to an end’
By Khalid Hasan

WASHINGTON: The Washington Post on Monday urged Pakistani civilian leaders to face up to their country’s responsibility for the Mumbai attacks.

In a hard-hitting editorial, the newspaper pointed out that by now, “the evidence that the terrorist assault on Mumbai was planned and directed from Pakistan is overwhelming.” The lone surviving attacker, a Pakistani national, has signed a statement describing how he was recruited and trained by the Lashkar-e-Tayyaba group. Intelligence officials say cell phone intercepts show that the attackers were communicating with Lashkar commanders in Pakistan during the attacks. During a visit to Islamabad, British Prime Minister Gordon Brown spoke for the West when he openly blamed Lashkar-e-Tayyaba for the siege and added that “the time has come for action, and not words,” from Pakistan.

The Post said, “Stunningly, however, Pakistan’s civilian government is refusing to acknowledge the truth. In an interview with the BBC last week, President Asif Ali Zardari claimed that there is still no proof that the attackers came from his country.

Several days earlier, he told Lally Weymouth of Newsweek and The Post that ‘I don’t have any specific information’ showing that the terrorists were trained in Pakistan.


India Gives Pakistan Letter Said to Be Gunman’s
Published: December 22, 2008

NEW DELHI — India on Monday gave Pakistan what it called proof of Pakistani involvement in last month’s terrorist attacks in Mumbai. The move built public pressure on India’s neighbor, where the senior-ranking member of the American military arrived for talks for the second time since the attacks.

The Indian Foreign Ministry announced late Monday that it had given Pakistani officials here what it described as a letter from the lone surviving attacker. In the letter, the Indian ministry said, the gunman, Muhammad Ajmal Kasab, said he and his nine accomplices were “from Pakistan.” India did not make the specific contents of the letter public.

Pakistan’s Foreign Ministry acknowledged receipt of the letter, saying only that “the contents of the letter are being examined.” The government in Islamabad, Pakistan’s capital, has denied any links to the terrorist attacks and pressed India to offer proof. American officials have in turn pressed Pakistan to do more to crack down on terrorist groups operating within its territory.

India and the United States have attributed the three-day attack on India’s financial capital to Lashkar-e-Taiba, a banned group based in Pakistan that has fought Indian forces in Indian-controlled Kashmir for years.


Posted by & filed under In The News.

"During times of universal deceit, telling the truth becomes a revolutionary act"
— Orwell

Dear CIGAs,

I am Outraged. This is simply too much. This is too far over the top and too much to bear. These sub humans should be throttled and locked up, not coddled.

You or I go bust and the attitude is the same as if we were Motors. Go belly up you jerks. Let them eat cake!

In fact in today’s market the US Fed and US treasury seem to almost enjoy watching the hedge funds break the law, resulting in the killing pensioners trying to protect themselves against the result of all this.

In today’s world the first rule of success is to donate $1,000,000 to both parties

The damned killer hedge funds blow up and look at who seeks them out to bail them out!

This is madness, preferential treatment and downright rotten to the core. I am outraged.

Why are you not?

Hedge funds gain access to $200bn Fed aid
Krishna Guha in Washington
Published: December 20 2008 05:01

Hedge funds will be allowed to borrow from the Federal Reserve for the first time under a landmark $200bn programme intended to support consumer credit.

The Fed said on Friday it would offer low-cost three-year funding to any US company investing in securitised consumer loans under the Term Asset-backed Securities Loan Facility (TALF). This includes hedge funds, which have never been able to borrow from the US central bank before, although the Fed may not permit hedge funds to use offshore vehicles to conduct the transactions.

The asset-backed securities to be funded under the programme are pools of credit card receivables, automobile loans and student loans.

The idea is to increase the supply of these loans and reduce borrowing rates by ensuring that the companies that make the loans can sell them on to investors who have guaranteed access to low-cost funding from the Fed.

The TALF is a key plank of the unorthodox strategy set out by the Fed last week as it cut interest rates virtually to zero. Washington insiders expect the programme will be dramatically expanded next year with further capital support from Treasury once the Obama administration takes office.



Jim Sinclair’s Commentary

US Intelligence Advisor James Rickards is a person who demands our respect.

Because of the enormous nature of this financial event, being ignored by most, I have to agree with him.

Four really, really bad scenarios
By EAMON JAVERS | 12/17/08 4:39 AM EST

What’s the worst that could happen?

That’s a question that James Rickards spends a lot of time pondering these days, as he sifts through the national security implications of the financial crisis facing the United States.

Rickards will lay out his worst case scenarios in a lecture sponsored by the Navy and the Office of the Secretary of Defense for Policy tonight. And his forecasts aren’t for the faint of heart.

Rickards calls it the “A to Z” problem: What are the threats that could make the U.S. economy look less like America and more like Zimbabwe? He sees them everywhere – in the Chinese ownership of vast amounts of American debt, in Russia’s increased centralization of its economy, in Al Qaeda’s long-established fascination with damaging the U.S. economy.

In many ways, Rickards is the ultimate bear. He’s not just thinking about whether the stock market will decline, but whether or not the stock market will survive.

All that puts Rickards decidedly outside mainstream economic and political thinking in America. But he does have an influential audience: the United States intelligence and defense communities.



Jim Sinclair’s Commentary

Why not? Everybody else has them.

The highest probability is that Pakistan lights up the whole area. We must not prevent our dear friends, the Saudis from playing the boom game.

The safest place on the planet is sub-Kenya Africa (not Rhodesia). How is that for a turn of events?

Report: Saudis seek nuclear weapons
Mon, 22 Dec 2008 11:07:05 GMT

Saudi Arabia has sought Pakistan’s help as part of its long-term plan to attain nuclear weapons for regional dominance, says a report.

"Reports have circulated for years that the Saudis have pursued a secret nuclear program with help from Pakistan, though the Saudis deny this," said a Wall Street Journal article titled ‘A Middle East Arms Race’.

For years now, media outlets have alleged that Saudi officials are interested in nuclear proliferation, citing comments by former Saudi diplomat Mohammed Khilewi — who defected to the US in 1994.

Khilewi reportedly handed over documents to US officials, which revealed that the Saudi government was interested in nuclear proliferation.

According to the diplomat, who now lives undercover in the New York City area, Saudi officials have had a covert nuclear weapons research effort since 1975.



Jim Sinclair’s Commentary

This article speaks for itself.

A monster out of control: Pakistan secret agents tell of militant links
Jeremy Page in Muridke
December 22, 2008

The Islamic fundamentalists who run the Markaz-e-Taiba complex near Lahore like to boast that it was inspired by Aitchison College, Pakistan’s poshest private school. It is, as they describe it, the Eton of Wahhabi Islam, complete with polo ponies and a swimming pool.

Yet when it comes to their links to Pakistan’s intelligence service and Lashkar-e-Taiba (LeT), the militant group blamed for last month’s attacks in Mumbai, they seem to suffer from collective amnesia. “We’ve never had any connection to either,” Mohammed Abbas, the administrator of the complex, told The Times.

But it was here, in April 2001, that Hafiz Mohammed Saeed, LeT’s leader at the time, called a meeting of his supporters in the 75-acre complex of red-brick buildings and neat lawns. Most of the visitors wore the obligatory long beards, but among them was an elderly man with no beard, only a thin, military-style moustache.

He was Hamid Gul, the former head of Pakistan’s Inter-Services Intelligence (ISI) agency. “Yes, I visited there,” General Gul told The Times. “Retired army officers used to go, too. They used to hold annual fixtures to raise funds and motivate people.”



Jim Sinclair’s Commentary

Today on Pakistan

Deaths in Pakistan ‘US strikes’

A suspected US missile strike has killed at least seven people in Pakistan’s northwestern tribal region.

One missile hit a vehicle in the village of Wana killing four people, while another strike killed three in a nearby village, both in South Waziristan on Monday, Pakistani intelligence officials said.

"Tribesmen opened fire on the drones after the attacks," a resident of Wana told Reuters news agency.


India Will Take All Steps Needed to Combat Terrorism (Update2)
By Kartik Goyal and Khalid Qayum

Dec. 22 (Bloomberg) — India will take all steps needed to combat terrorism emanating from Pakistan, Foreign Minister Pranab Mukherjee said, adding that the government in Islamabad must also act against terrorists on its territory.

The government in New Delhi has blamed “elements” in Pakistan for being behind the Nov. 26-29 attack on Mumbai that killed 164 people. Pakistan, which has pledged to cooperate with the investigation, said it has been given no evidence the attacks were carried out by Pakistanis.


Pakistan militants ‘world threat’

Militant groups in Pakistan are "the greatest danger to peace and security in the entire world", India’s foreign minister has said.

Pranab Mukherjee accused Islamabad of "denial" and "shifting the blame" for last month’s deadly Mumbai attacks.

He said the international community had not done enough to exert pressure on Pakistan, which denies any involvement.


Posted by & filed under In The News.

ATT8 - 20081221_065347

Dear Friends,

Don’t lose focus on the enormity of what has taken place. It is that unimaginable size of the socialization of the losses while privatizing by monetization the ill gotten gains from pawning off fraudulent OTC derivatives. The massive size of this disaster caused entirely by OTC derivative implosions and fraudulent valuations will function to make my gold price target of $1650 that I have held for over eight years pitifully low. Alf Fields’ next leg from the recent low to $6000 has moved to probable from simply possible.

– Consider what the junior golds holding real properties will be worth.
– Consider what RGLD will be worth.
– Consider how difficult it is now for anyone to find any investment in currencies or governments.
– Consider that gold is the only true currency because there is no liability attached to it.
– Consider that the dollar represents the largest debtor entity while the euro is not.
– Consider that all government statistics are tools of spin, therefore know the truth as below

Truth in Statistics exist only at

– Growth Surges/Accelerates in Broad Money Components
– Monetary Base Up 97.5% Year/Year
– Fed Actions Begin to Kick In — For Better and Worse
– U.S. Dollar Remains Key to Markets


Jim Sinclair’s Commentary

Fiscal Stimulation like bailouts is open ended. The number coming from the back channel now is $2 trillion. The combination of fiscal stimulation, bailout-itise, and quantitative easing is all the tools there are. they will have a major impact, but not in the manner desired.

As Outlook Dims, Obama Expands Recovery Plans
Published: December 20, 2008

WASHINGTON — Faced with worsening forecasts for the economy, President-elect Barack Obama is expanding his economic recovery plan and will seek to create or save 3 million jobs in the next two years, up from a goal of 2.5 million jobs set just last month, several advisers to Mr. Obama said Saturday.

Even Mr. Obama’s more ambitious goal would not fully offset as many as 4 million jobs that some economists are projecting might be lost in the coming year, according to the information he received from advisers in the past week. That job loss would be double the total this year and could push the nation’s unemployment rate past 9 percent if nothing is done.

The new job target was set after a meeting last Tuesday in which Christina D. Romer, who is Mr. Obama’s choice to lead his Council of Economic Advisers, presented information about previous recessions to establish that the current downturn was likely to be “more severe than anything we’ve experienced in the past half-century,” according to an Obama official familiar with the meeting. Officials said they were working on a plan big enough to stimulate the economy but not so big to provoke major opposition in Congress.

Mr. Obama’s advisers have projected that the multifaceted economic plan would cost $675 billion to $775 billion. It would be the largest stimulus package in memory and would most likely grow as it made its way through Congress, although Mr. Obama has secured Democratic leaders’ agreement to ban spending on pork-barrel projects.

The message from Mr. Obama was that “there was not going to be any spending money for the sake of spending money,” said Lawrence H. Summers, who will be the senior economic adviser in the White House.


Jim Sinclair’s Commentary

It is coming and is extremely dangerous. If two highly excitable nuclear capable nations go at each other, it will not end until the end. When it hits the fan in either of these countries, the national lights are on, but mentally nobody is home.

Report: India may attack Pakistan
Sat, 20 Dec 2008 15:27:30 GMT

Indian military has prepared operations against targets in Pakistan and awaits the signal to go forward, a US intelligence report says.

"These most likely would take the form of unilateral precision strikes inside Pakistan-administered Kashmir, along with special forces action on the ground in Pakistan proper," Global Intelligence Service, Stratfor said in its latest report.

"Sources have indicated to Stratfor that New Delhi is going through the diplomatic motions in order to give Pakistan the opportunity to take care of the militant problem itself – but the Indians know that Islamabad has neither the will nor the capability to address their concerns," the agency said.

It explained that India knew strikes in Pakistan would not eliminate the terrorist threat, "but that would not be the aim of any such operation". It added, "Instead, India has to communicate firmly that it will no longer tolerate attacks from Pakistan-based militants – whether they are rogue or approved by the state. Failure to do so risks emboldening the militants and their enablers, as well as a domestic political backlash. The Indian government could not live with either of those outcomes."

Earlier on Friday, Indian Foreign Minister Pranab Mukherjee said that the government was keeping all options open in dealing with the situation. "If a country cannot keep the assurances that it has given, then it obliges us to consider the entire range of options that exist to protect our interests and people from this menace."


Posted by & filed under In The News.


Jim Sinclair’s Commentary

When you read articles like this keep in mind who is the most powerful man on the planet. The answer is the captain of a nuclear launch submarine. He has the power to incinerate nations.

Now think about how India has two Akula type 2 nuclear missile launching (28 per ship) submarines, and Pakistan has mobile nuclear launch vehicles with very long legged missiles.

I would say that is as serious as it gets.

After having a home in India and having lived there for a total of three years in short stays I can assure when it hits the fan the police with the guns and uniforms and the lights turned off are the most dangerous people there in any situation.

India may still strike at Pakistan: US report
19 Dec 2008, 2207 hrs IST, TNN

NEW DELHI: India may have ruled out the military option against Pakistan in the aftermath of Mumbai terror attacks but the international intelligence community continues to believe that strikes in PoK and elsewhere could still happen.

Global intelligence service Stratfor, in its latest report, said, "Indian military operations against targets in Pakistan have in fact been prepared and await the signal to go forward."

It added, "These most likely would take the form of unilateral precision strikes inside Pakistan-administered Kashmir, along with special forces action on the ground in Pakistan proper."

The private sector intelligence service said that unlike the massive movements of 2002 during Operation Parakram, India’s preparations this time were more under the radar and not visible to the world at large. Its only indication was the fact that the Border Security Force (BSF) has been put on high alert on the western sector as well as the eastern sector — this paramilitary force’s main mandate would be to prevent infiltration.

"Sources have indicated to Stratfor that New Delhi is going through the diplomatic motions in order to give Pakistan the opportunity to take care of the militant problem itself — but the Indians know that Islamabad has neither the will nor the capability to address their concerns," Stratfor said.


Posted by & filed under In The News.

Jim Sinclair’s Commentary

Quantitative easing combined with fiscal stimulation leads to the advent of the increased velocity of money. This equals lower values for the currency of the largest liquidity producer – the dollar. Confidence sunders when business activity statistics are less ebullient than the real rate of inflation. Confidence is the key as hyperinflation is a currency event, not a business event.

In Zimbabwe the price of food is doubling daily just as it did in all examples of hyper inflation.

$1 trillion is only the beginning for Obama’s fiscal stimulation.

Do you recall the low bailout estimates made when Bear blew up?

Monty Guild’s Commentary

Good call Jim. In my opinion, everything you say is exactly correct. From an economics point of view, the long term effect of these actions will be inflation.

I talk to a lot of economists. Although my Keynesian friends disagree with the inflation from money supply growth thesis, largely because it is a Monetarist viewpoint, they do admit that the current large increase in the supply of bonds could send the dollar lower. Like you and Dan, I strongly believe that the huge issuance of US bonds, and the actual printing of money to which Mr.Bernanke alluded, can only send the dollar lower. In my opinion, this will send gold and foreign currencies much higher.

Obama Team Is Seeking Stimulus Bill by New Year

WASHINGTON — President-elect Barack Obama’s advisers hope to finish an economic recovery blueprint by Dec. 25 so that Democratic Congressional staff members can draft legislation by the new year, as the two branches of government try to converge on a two-year plan by late January that could total just under $1 trillion.

“The goal for completing action on this important legislation should be as close to Jan. 20 as possible,” said an e-mail message from Senate Majority Leader Harry Reid’s office to senior Senate Democratic staff members.

Some Obama advisers have sought to tamp down expectations that Mr. Obama could sign a package immediately after he is inaugurated. The opposition of some Senate Republicans and House and Senate negotiations on a final compromise could force delays into February.

Democrats familiar with the early deliberations say the preliminary price tag has grown to about $800 billion from the roughly $600 billion that House Speaker Nancy Pelosi had estimated in recent days.



Jim Sinclair’s Commentary

These reports, like the reports on WMDs in Iraq, presages a move into Pakistan "to help" the government of Pakistan kill all the bad guys as a recent article in the Washington Post suggested.

‘ISI killing US troops in Afghanistan’
Fri, 19 Dec 2008 06:01:29 GMT

Pakistan’s powerful spy agency is working with groups that support the Taliban and are killing American troops in Afghanistan, a US report says.

“All of this suggests that the Inter-Services Intelligence (ISI) is no longer certain the coalition forces will prevail in Afghanistan and that it is using militants groups in an attempt to expand its own influence,” the report said.

The report by the bipartisan Pakistan Policy Working Group also cites the Afghan government’s allegations that ISI-supported elements that orchestrated an assassination attempt on Afghan President Hamid Karzai, and that the ISI had a role in the July 7 car bombing of Indian embassy in Kabul.

The 43-page report notes Pakistan may be the greatest challenge for US President-elect Barrack Obama.

The report came as Pakistani major media outlets said that the ISI had been cleared of any involvement in the Mumbai terrorist attacks by the US’ Federal Bureau of Investigation (FBI). According to Karachi-based Dawn, FBI agents interrogated Ajmal Kasab, the lone surviving terrorist for nine hours in Mumbai. They concluded that he was a Pakistani national but ISI was not involved.


Jim Sinclair’s Commentary

Note how the markets took this both when announced as coming, and on its advent. I feel Obama’s fiscal stimulation will produce a general lift of the equity gang’s spirits, and a good lift to gold as the dollar is weighed down by the cost of fiscal stimulation.

Bush Approves $17.4 Billion Auto Bailout
Published: December 19, 2008

WASHINGTON — President Bush announced $13.4 billion in emergency loans on Friday to prevent the collapse of General Motors and Chrysler, and another $4 billion available for the hobbled automakers in February with the entire bailout conditioned on the companies undertaking sweeping reorganizations to show that they can return to profitability.

The loans, as G.M. and Chrysler teeter on the brink of insolvency, essentially throw the companies a lifeline from the taxpayers that will keep them afloat until March 31. At that point, the Obama administration will determine if the automakers are meeting the conditions of the loans and will continue to receive government aid or must repay the loans and face bankruptcy.

The money to aid the automakers will come from the Treasury’s $700 billion financial stabilization fund and shortly after Mr. Bush’s announcement, the Treasury secretary, Henry M. Paulson Jr., who will oversee the aid to the auto industry, said Congress would need to release the second $350 billion for that program in short order.

By law, once Mr. Paulson makes a formal request, Congress has 15 days to reject it and deny the additional money. It was unclear when that request would be sent or if lawmakers who have left Washington for the holidays, would return to debate it. The administration’s handling of the program has come under sharp criticism and several lawmakers in both parties have suggested they would oppose the release of more money.



Jim Sinclair’s Commentary

It amazes me how the obvious is always ignored as it approaches the full light of day.

Pakistan remains the world’s most serious problem.

NATO Materiel Threatened in Pakistan
Taliban Attacks on Goods for Afghanistan Mission Viewed With Growing Concern
By Candace Rondeaux and Walter Pincus
Washington Post Foreign Service
Friday, December 19, 2008; Page A23

PESHAWAR, Pakistan — A recent increase in Taliban attacks on a crucial NATO transportation route from Pakistan to Afghanistan could imperil efforts to bolster the flagging, seven-year U.S.-led military campaign in Afghanistan, U.S. and Pakistani officials say.

Attacks on NATO supply lines have become a regular occurrence in parts of northwestern Pakistan, including the country’s inhospitable tribal areas near the Afghan border. In the past two weeks, Taliban fighters have mounted at least six assaults on NATO supply depots near the Pakistani city of Peshawar, setting fire to more than 300 armored Humvees, military vehicles and other supply containers.

The attacks come as Pakistanis are increasingly calling for Western forces to stop using their territory for transport: Thousands of people rallied here Thursday to demand that the government cut off U.S. and NATO access to the main transit route.


Fears grow over Pakistan terror resolve
By James Lamont in New Delhi
Published: December 19 2008 02:00 | Last updated: December 19 2008 02:00

Fears grew last night that Pakistan’s resolve to bring the perpetrators of the Mumbai terror attacks to justice was faltering.

The government said it had lost track of one of India’s most wanted militants following his supposed arrest only a few days ago.

Shah Mahmood Qureshi, Pakistan’s foreign minister, said Masood Azhar, the leader of Jaish-e-Mohammad, a militant group, was not under arrest, contradicting his government’s previous claim that he was in custody.

"Other people have been detained but Mr Masood Azhar is at large. We have no knowledge of his whereabouts," Mr Qureshi told reporters in Islamabad. The Pakistani defence ministry said a week ago that security forces had arrested Mr Azhar, who is suspected of launching an attack on the Indian parliament in 2001 that brought India and Pakistan to the brink of war.