Posted at 1:28 PM (CST) by & filed under General Editorial.

Dear Friends,

There will be many forecasting market results of the election of President Obama. I suggest we wait to see his cabinet in order to look to the future with any degree of accuracy.

What we do know is:

  1. Many of the evil money ruler geniuses are out of the lime light.
  2. Even if Wall Street is still pulling strings, this Administration will not have Paulson who jiggled every market on the planet fairly well.
  3. The PTT team, if it exists, will be made up of lesser lights because the past Administration ruled that.
  4. All the problems are still out there as virulent cancers that have spread out of control in the financial market and are not operable. Thank you all you OTC derivatives that up to now have not been singled out to accept blame. This could change but do not count on it.
  5. You can count on fiscal stimulation as it is a tenet of how the Democratic mind moves.
  6. You can count on higher taxes for Daddy Warbucks and reductions for the ordinary man who carries the Federal Budget money-wise.
  7. You can count on an interesting period in terms of geopolitical challenges to the USA from their many enemies in order to size up the new leadership.
  8. You can count on meaningless dialog with all those about to test the new Administration geopolitically.
  9. You can count on gold at $1200 and then $1650.
  10. You can count on the US dollar trading at USDX .72, .62, and.52.
  11. You can count on the reestablishment of social and economic safety nets.
  12. You can count on the now shredded Constitution remaining shredded. Once power comes into an Administration it stays their permanently.

Respectfully yours,
Jim

Posted at 12:48 AM (CST) by & filed under Guild Investment, Jim's Mailbox.

Dear Jim,

One need only read the following article to see the absurdity of the proposition that the US dollar can stay strong. The interest on this $2.1 Trillion [so far] or excess debt alone will eventually swamp the budget. It is absurd and highly correlated with US money coming back to the US from overseas investing and foreign money coming to the US for a safe haven during a crisis. These are short term events, the dollar’s day in the sun is drawing to a close and soon it will reverse. By the way, after 9/11 the dollar rallied for 4 months and then fell for 7 years. Thus far the dollar rally is about 3 1/2 months old.

Respectfully yours,
Monty Guild
www.GuildInvestment.com

RPT-PREVIEW-US Treasury to expand debt arsenal as deficit rises
Tuesday, November 04, 2008 5:00:06 AM (GMT-08:00)
By David Lawder

WASHINGTON, Nov 4 (Reuters) – Facing the need to borrow up to a staggering $2.1 trillion in the current fiscal year to fund economic rescue programs, the U.S. Treasury is expected to significantly expand its debt securities arsenal.

Analysts anticipate that the Treasury on Wednesday will announce the return of the 3-year note and adopt more frequent offerings of 10-year notes and 30-year bonds. It may also consider more reopenings of shorter maturities.

“They are going to pull out all the stops. There’s a good chance they’ll come back to a quarterly 3-year note, monthly 5-year (note) auctions and increase issuance pretty subtantially across the board,” said Kim Rupert, head of global fixed-income analysis at Action Economics in San Francisco.

The Treasury Department said on Monday it would need to borrow a record $550 billion in the October-December quarter, including a likely $300 billion in financing for Federal Reserve liquidity operations.

The total was $408 billion higher than previous estimates announced in July 2008 due to outlays for economic assistance programs, lower tax receipts and lower issuance of non-marketable debt securities to state and local governments.

More…

Posted at 6:40 PM (CST) by & filed under General Editorial.

Dear CIGAs,  

Here is some information for all of you to help us recapture the price from the gold banks.

Contracts: An Overview

Contracts are promises that the law will enforce. The law provides remedies if a promise is breached or recognizes the performance of a promise as a duty. Contracts arise when a duty does or may come into existence, because of a promise made by one of the parties. To be legally binding as a contract, a promise must be exchanged for adequate consideration. Adequate consideration is a benefit or detriment which a party receives which reasonably and fairly induces them to make the promise/contract. For example, promises that are purely gifts are not considered enforceable because the personal satisfaction the grantor of the promise may receive from the act of giving is normally not considered adequate consideration. Certain promises that are not considered contracts may, in limited circumstances, be enforced if one party has relied to his detriment on the assurances of the other party.

More…

Jim Sinclair’s Commentary

The following is a review of the conditions of COMEX Rulebook Chapter 113 that constitutes the contract between buyer and seller on the COMEX gold contract.

Delivery cannot be denied legally to any party of any definition that is on the long side of the delivery and is prepared to make full payment by having those funds available at his brokerage firm.

A default by the COMEX has nothing to do with a financial failure but rather a failure to perform according to the contract by making delivery.

That violation of obligation would result in cash only trades with 100% margin and would destabilize and stop the Gold Bank’s ability to own the price.

If you are tired of being had by paper gold the following is the only course of action if you wish to take a positive step to end the games being played at your expense.

Delivery Process for Gold or Silver:

Delivery – Prudential holds the receipt in PFG’s account for customer 

  1. Client buys the futures contract.
  2. Client will take delivery between First Notice Day and the Last Trading Day.
  3. On delivery day account is debited cost plus a $50.00 delivery fee.
  4. Receipt is booked to customers account
  5. Monthly storage charge passed on to customer’s account(about $50.00).

Physical Delivery – Customer wants bars in their procession

  1. Client buys the futures contract.
  2. Client will take delivery between First Notice Day and the Last Trading Day.
  3. On delivery day account is debited cost plus a $50.00 delivery fee.
  4. We will provide the customer with name and phone number of the individual at the depository to contact.
  5. Customer makes arrangements for the physical delivery

CIGA JB Slear, who is in the commodity business, offers his services to assist anyone seeking physical delivery of metals. He will guide you through the entire process, including arrangements for delivery.

To be totally clear, I expect JB not to discuss any type of speculation with you but ONLY help you acquire 100 ounce gold bars. Once 21,000 bars have been taken the paper gold’s reign over the price of gold is over.

CIGA JB Slear can be reached at the following:

Fort Wealth Trading Co. LLC
www.FortWealth.com
866-443-0868
ext 104

 

The COMEX contract you are party to when long gold in terms of delivery which must be adhered to or default occurs. There is legal remedy for this default.

 

COMEX Division – Gold Rules

113.01 Tenderable Gold
113.02 Approved Refiners; Licensed Depositories; Licensed Weighmasters; Approved Deliverers; Approved Assayers
113.03 Weight Certificates and Assay Certificates for Gold
113.04 Packaging of Tenderable Gold
113.05 Storage of Gold
113.06 Gold Deposit Annual Audit Procedures
113.07 Form of Gold Contract
113.08 Delivery Months and Days for Trading in Gold
113.09 Price Multiples for Gold
113.10 Deleted
113.11 Delivery Notice for Gold
113.12 Delivery of Gold

113.01 Tenderable Gold

In fulfillment of every contract of gold, the seller must deliver 100 troy ounces (5% more or less) of refined gold, assaying not less than 995 fineness, cast either in one bar or in three one-kilogram bars by an approved refiner. The weight, fineness, bar number and identifying stamp of the refiner must be clearly incised on each bar by the approved refiner. 

113.02 Approved Refiners; Licensed Depositories; Licensed Weighmasters; Approved Deliverers; Approved Assayers

(a) The Board Trade Group, upon the recommendation of the Committee on Precious Metals, shall designate as approved refiners those gold refiners whose gold bars shall be accepted as tenderable gold in connection with deliveries of gold in fulfillment of an Exchange contract for gold. Additional approved refiners may be designated in the same manner from time to time. The Board Trade Group may also terminate the designation of a gold refiner at any time as an approved refiner, and from and after the date of such termination, gold produced by such refiners may not be placed in a licensed depository for delivery in fulfillment of an Exchange contract for gold. Neither the addition nor deletion of a gold refiner as an approved refiner shall be deemed to affect the amount of money to be paid or the grade or quality of gold to be delivered in fulfillment of an Exchange contract for gold, and shall be binding upon all contracts entered into before as well as after the adoption of any such change, anything in these Rules to the contrary notwithstanding.

More…

 

Posted at 4:16 PM (CST) by & filed under In The News.

Dear CIGAs, 

The last pillar required for a massive gold move is the 30 year USA long bond breaking below its 35 year up trend line.

The most important points: 

“America is bankrupt. American government bonds are extremely overvalued. “The world’s last bubble.” America is in debt for over 13.000 billion (13 trillion) dollar and adds a 1.000 billion dollar debt each year. According to Rogers this can not continue for long. Therefore, he went short in long-term US goverment bonds. “These bonds have peaked.” By the way: Rogers owns Dutch government bonds. “They are safe.”

“The fact that the dollar is gaining rapidly is only temporary”, Rogers says. “All hedge funds were short on the dollar and because of the appreciation of the dollar there is a short squeeze for the dollar. Managers have to close thier positions and they have to buy dollars instead.” “This is temporary, within a year you have to get rid of the dollar. Fundamentally it is a drama.” 

Jim Rogers: America is bankrupt (English version)

America is bankrupt, according to investment legend Jim Rogers. “The American government bonds are the world’s last bubble and the price of commodities has to increase.”

Charismatic
The famous and charismatic investor, guru if you will, Jim Rogers, visited ABN Amro Netherlands last Friday. RTL Z was at ABN headquarters as well and recorded a number of statements, investment tips and opinions about the world economy.

Rogers
During the seventies Jim Rogers (66) managed a successful hedge fund with George Soros. After that, he traveled and went into commodities. Click here for the wikipedia entry for Rogers. 

Last Friday Rogers went at it in front of a roomful of ABN private banking clients. We had an exclusive 15-minute interview with Rogers.

More…

Jim Sinclair’s Commentary

More from Pakistan. The drones did it. 

Pakistan condemns U.S. missile strikes
SAEED SHAH
November 3, 2008 at 10:39 PM EST

ISLAMABAD – Tensions increased between Pakistan and the United States Monday when President Asif Zardari and other officials roundly rebuked American military commander General David Petraeus over U.S. missile strikes inside Pakistan.

Gen. Petraeus, credited with pulling Iraq away from the brink, has now been charged with developing a strategy to rescue the war in Afghanistan. He has overall charge of the Middle East and Central Asia, including Iraq and Afghanistan, as head of U.S. Central Command, and made Pakistan his first visit to the region.

Pakistan’s co-operation is considered vital if the Taliban insurgency in Afghanistan is to be quelled, but Islamabad has been incensed by U.S. missile attacks inside its territory against suspected militants. 

Mr. Zardari told Gen. Petraeus, according to a statement issued by the President’s office, that “continuing drone attacks on our territory, which result in loss of precious lives and property, are counterproductive and difficult to explain [for] a democratically elected government. It is creating a credibility gap.” on those bombing drones.

More…

Jim Sinclair’s Commentary

When the lower rate is so desirable I imagine the feeling among regulators, officials and of course the obedient brown nose media is that of “who cares.”

Note there is no media coverage of the strong doubt remaining amongst rational people that Lie-bor, as a tool of the bankers, does the necessary in the best interest of those who report their cost of dollars that constitute the much watched Libor rate.

Maybe they will declare Libor at ½ percent soon.

London Interbank Offered Rate (LIBOR)

Definition:
Interest rate at which the London banks are willing to offer funds in the inter-bank market. LIBOR is the average of rates which five major London banks are willing to lend $10 million for a period of three or six months, and is the benchmark rate for setting interest rates for adjustable-rate loans and financial instruments.

Link…

 

Bankers Cast Doubt On Key Rate Amid Crisis
By CARRICK MOLLENKAMP

 LONDON — One of the most important barometers of the world’s financial health could be sending false signals.

In a development that has implications for borrowers everywhere, from Russian oil producers to homeowners in Detroit, bankers and traders are expressing concerns that the London inter-bank offered rate, known as Libor, is becoming unreliable.

Libor plays a crucial role in the global financial system. Calculated every morning in London from information supplied by banks all over the world, it’s a measure of the average interest rate at which banks make short-term loans to one another.

More… 

 

Lie-bor?
by Jeffrey Cane  Apr 16 2008

Questions grow about a major rate.

One of the arcane financial acronyms that has gained much prominence over the course of the credit crisis is Libor-the London interbank offered rate. It is the average interest rate when banks make short-term loans to one another.

It is one of the most important credit benchmarks, used by banks and financial institutions around the world.

Carrick Mollenkamp of the Wall Street Journal reports that there are growing suspicions that some banks may be underreporting the rates they are paying for short-term loans, undermining the accuracy of the Libor. 



His report is a startling revelation. If the Libor is viewed as unreliable, the credit crisis may be much worse than previously thought, with borrowers receiving loans tied to the index getting a cheaper rate than they should.

More… 

 

Jim Sinclair’s Commentary

Brokerage full service retirement plans will be retired before you will. Gold is all that will protect your retirement.

Lehman Good-for-Retirement Notes Worth Pennies for UBS Clients
By Bradley Keoun and David Scheer

Nov. 3 (Bloomberg) — UBS AG, Switzerland’s largest bank, faces dozens of claims in the U.S. from clients who bought “100 percent principal protected notes” issued by Lehman Brothers Holdings Inc. that are now almost worthless.

Six attorneys hired to represent clients in the cases say UBS brokers touted the so-called structured notes as low-risk investments and failed to emphasize they were unsecured obligations of Lehman, which filed for bankruptcy in September. State regulators are fielding so many calls about Lehman’s notes they’re considering a task force to investigate the sales, said Rex Staples, general counsel for the North American Securities Administrators Association Inc., a group of 67 state and provincial regulators based in Washington.

“The sales pitches were that it’s good for retirement accounts, and good for the safe, fixed-income part of people’s portfolios as an alternative to owning stocks, because it’s less risky,” said Seth Lipner, a lawyer in Garden City, New York, hired by two holders of Lehman notes sold by UBS, including a 65- year-old accountant who says he lost $1.4 million in retirement savings. “Of course, it turned out to be more risky.”

Any awards for investors would add to the financial industry’s burgeoning costs for compensating individuals who bought supposedly safe investments that crumbled in the credit crunch. Banks and securities firms, including Zurich-based UBS, Citigroup Inc. and Merrill Lynch & Co., already have had to swallow more than $3.6 billion in fines and market losses on auction-rate securities they had to buy back from clients under orders from the U.S. Securities and Exchange Commission and regulators in New York, Massachusetts and other states.

More…

Posted at 11:18 PM (CST) by & filed under Jim's Mailbox.

Jim,

Last Thursday afternoon I dropped into the local Suzuki automobile dealer in order to have a look at the new SX4 AWD mini crossover. The sales manager and I got chatting about the economy and as it turns out, he was quite knowledgeable on the subjects that we all read regularly on JSMineset.com. This gent was involved in real estate investing on the side; specifically going to bank auctions, the ones where the bank is doing an absolute auction of properties they have already taken under a prior foreclosure.

He told me that one should not listen to any of the ‘reports’ of housing price declines, because they do not honestly reflect what is going on out there for the educated buyers. He told me that he was at an auction last week of several fairly new 3 bedroom homes on 4 acres across the street from a local lake here in New Hampshire with water rights and they were selling for $35K each at auction. I asked him how much these houses had originally sold for and he said $300K a few years ago!! I asked how many he picked up… he said none! I asked why at 11 cents on the dollar did he not buy anything? He told me that he is watching the stress in the markets closely and he feels they still have much further to go on the downside. His high bid was $25K and that’s all he is willing to pay.

He then told me of a very nicely renovated old farmhouse with attached large barn on an in town city lot of about ½ acre up near the lakes region in NH that was quite valuable that sold for $65K at bank auction a week or so ago. He said the inventories are full of this stuff and it’s going to get much worse. WOW! And none of this is being broadcast anywhere! He explained that he is on a series of auction listing sites which supply him the [real] data and offerings. It’s getting very ugly out there if this is all true information.

CIGA Bruce

CIGA Bruce,

Who said things were much worse internationally than in the good ole USA?

Regards,
Jim