“A prudent man foresees the difficulties ahead and prepares for them;
the simpleton goes blindly on and suffers the consequences.” – Proverbs 22:3


IF YOU REALLY WANT TO KNOW, WHAT IS HAPPENING IN THE REAL ECONOMY...WATCH WHAT THE BILLIONAIRES ARE DOING...Here's 3 prime examples...

1. Please read ALL of this article, and you will find out what the Billionaires are really doing right now...If this isn't a RED FLAG...Then I don't know what is...
Malone Is Fired Up by Cable and Ready to Buy - WSJ.com


2. Know your future... read this book...better safe then sorry...
If Warren Buffet is recommending it to his Millionaire and Billionaire investors shouldn't you read it too?
I know...I know... I can hear you now...you think just because you don't have a lot of money and you are not invested in the Stock market, that it won't affect you...but you would be 100% wrong...it will affect you the most...
Buffett Says Hasn't Heard of Book He's 'Recommending'


3. New York Observer article: The New Doom. In it, a billionaire confided: "We have a retreat that’s right on the Quebec border. We own 18 miles on the border, so we can cross. Anytime we want to we can get away". Also note where the Hedge fund manager has a retreat...



China is quietly dumping massive amounts of U.S. Treasuries
Stealth escape from the dollar continues...



Norquist: Bush Tax Cut Expiration Will Cost Taxpayers $1 Trillion


The ABA'S projections for the U.S. Economy
Greetings and my Compliments. I have just returned from a training meeting my employer, USDA-Rural Development. It was presented by the American Bankers Association. Bottom line, the ABA is projecting the economy not to bottom out until late in 2014. With over 90 banks already closed (in 2010) and some 775 on the the "Troubled" list, things do not look good. The troubled list has a projected 70 percent failure rate.


The Economist: Gold: Store of value.


States Dodge Defaults as California May Cut Worker Pay


Gold Keeps Rising as Panicky Investors Look for Security


Harry Schultz on the Power Elite, Free Markets, The Internet, and Why Gold Is Going Much Higher


China Cuts Rare Earth Export Quota 72%, May Spark Trade Dispute With U.S.


China, Commodity King (Mogambo Guru)

In The News Today

Posted: Jul 15 2010 By: Jim Sinclair Post Edited: July 15, 2010 at 4:41 pm

Filed under: In The News

Jim Sinclair’s Commentary

QE to infinity is in the cards.

Fed eyes steps to bolster sputtering recovery
Jul 14, 7:00 PM (ET)
By JEANNINE AVERSA

WASHINGTON (AP) – Federal Reserve officials cut their forecasts for growth this year and signaled they stood ready to take new steps to keep the recovery alive if the economy worsens.

A new document, released Wednesday, revealed a more cautious mood among the Fed policymakers in light of Europe’s debt crisis, a volatile Wall Street, a stalled housing market and high unemployment.

With risks growing, Fed officials at their June 22-23 meeting saw the need to explore new options for bolstering the economy. That’s a turnaround from earlier this year when they were moving to wind down crisis-era supports.

No new specific steps were disclosed or agreed upon at that time.

However, if the recovery were to deteriorate, Fed policymakers have options. They could revive programs to buy mortgage securities or government debt. They could lower the rates banks pay for emergency Fed loans. The Fed also could create a new program to spark more lending to businesses and consumers in a bid to lure them to ratchet up spending and grow the economy.

More…

Jim Sinclair’s Commentary

This was MOPEd this morning as lenders are on the track to take back collateral.

Banks repossess US homes at record pace –RealtyTrac
Thu Jul 15, 2010 12:01am EDT
By Lynn Adler

July 15 (Reuters) – Banks repossessed a record number of U.S. homes in the second quarter, but slowed new foreclosure notices to manage distressed properties on the market, real estate data company RealtyTrac said on Thursday.

The root problems of job losses and wage cuts persist, making a sustained U.S. housing recovery elusive.

Banks took control of 269,962 properties in the second quarter, up 5 percent from the prior quarter and a 38 percent spike from the second quarter of last year, RealtyTrac said in its midyear 2010 foreclosure report.

Repossessions will likely top 1 million this year.

"The underlying conditions haven’t improved," RealtyTrac senior vice president Rick Sharga said in an interview.

More…

Jim Sinclair’s Commentary

They start to scream at their representatives. Their representatives start to scream at the Administration. The Administration starts to scream at the Fed, with 3 new members, and QE to infinity.

Fears grow as millions lose jobless benefits
By Nick Carey
CINCINNATI | Wed Jul 14, 2010 5:38pm EDT

CINCINNATI (Reuters) – Deborah Coleman lost her unemployment benefits in April, and now fears for millions of others if the Senate does not extend aid for the jobless.

"It’s too late for me now," she said, fighting back tears at the Freestore Foodbank in the low-income Over-the-Rhine district near downtown Cincinnati. "But it will be terrible for the people who’ll lose their benefits if Congress does nothing."

For nearly two years, Coleman says she has filed an average of 30 job applications a day, but remains jobless.

"People keep telling me there are jobs out there, but I haven’t been able to find them."

Coleman, 58, a former manager at a telecommunications firm, said the only jobs she found were over the Ohio state line in Kentucky, but she cannot reach them because her car has been repossessed and there is no bus service to those areas.

More…

Is War On The Horizon In Iran? Many Signs Point That Way

Posted: Jul 15 2010 By: Monty Guild Post Edited: July 15, 2010 at 4:37 pm

Filed under: Guild Investment

Jim Sinclair’s Commentary

The key here is Israel makes a serious miscalculation.

Dear CIGAs,

Although many have predicted over the past five years that Iran would be at war with the west or Israel, such an outcome has not developed. We seldom comment on war preparation activities and have not done so recently, and although it is not our normal modus operandi, we would like to point out that currently many signs point to the potential for hostility with Iran to develop. Please note the following points.

1. Iran is becoming more isolated.
2. Russia has stated that they believe Iran may be close having a nuclear weapon. Many believe that they may already have developed nuclear weapons. It appears that Russia is starting to moderate their view on Iran to a view more similar to that of the western powers.
3. Iran’s friends in the Arab world, who have helped them in many ways, are starting to move a way from them.
4. Iran has sold much of the oil they had stored in tankers offshore. It occurs to us that they maybe raising cash for an expected war.
5. We have noticed several countries buying gold, and a few are selling gold and/or borrowing against their gold holdings. We do not know if Iran is engaged in this activity but if they are expecting war, they are undoubtedly trying to raise cash in order to support that effort.
6. We notice that Prime Minister Netanyahu and President Obama had a cordial conversation at the White House and Obama has recently expressed more support for Israel.

Could it be that we are approaching a war between Iran and Israel and/or the west, with the U.S. supporting Israel and Russia demanding concessions for not intervening? Although we are not political analysts, and we do not know that war is in any way an eventuality, we believe that it is a possibility.

Should a war develop in this oil producing region, fears that it could spread would likely send oil and gold prices much higher. Should a war develop, the stocks of oil companies that produce oil in Canada and other politically safe locations would be in demand.

AS WE HAVE REPEATEDLY STATED, GROWTH WILL BE SLOW IN THE U.S., EUROPE AND JAPAN

The most recent meeting of the U.S. Federal Reserve Open Market Committee was somber. Most members cut their outlook for growth and raised their outlook for unemployment.

The major take away was that the U.S. economy will take a long time to recover and will grow slowly. We have known this for some time, but the confirmation by the Fed’s economists is sure to drive the point home.

Here is a quote form the minutes of the meeting. “Overall, participants continued to expect the pace of the economic recovery to be held back by a number of factors, including household and business uncertainty, persistent weakness in real estate markets, only gradual improvement in labor market conditions, waning fiscal stimulus, and slow easing of credit conditions in the banking sector.”

Translation: slow growth ahead. For more information please click on this article from the Wall Street Journal of July 14, 2010 entitled Fed Sees Slower Growth by Jon Hilsenrath. It can be found at:

Wall Street Journal Online

As we stated last week, growth will be strong in China, India, Brazil, and selected well managed countries like Germany, Canada, and Singapore. If war develops in Iran gold and oil will get particular attention, however, even without war in Iran, both still are attractive long term in our opinion.

Thanks for listening.

Monty Guild and Tony Danaher
www.GuildInvestment.com