Bill Gross Pimco Tweet...

 

 

In The News Today

June 24, 2011, at 2:15 pm
by Jim Sinclair in the category In The News |  Print This Post |  Email This Post

Jim Sinclair’s Commentary

Here is the latest from John Williams’ ShadowStats.com.

- Bernanke Befuddled by Weak Economy?
- Major Downside Revisions to GDP Revisions Loom As Economy Slowly Slides into a Double-Dip
"No. 375: GDP Revision, May Durables Goods Orders and Home Sales"
http://www.shadowstats.com



Jim Sinclair’s Commentary

The system is no more sound now than it was when these occurrences were taking place.

The Fed cannot afford to even play Hawk. It can all come apart at any time, even before you read this.

Holmes: Gold Prices Could Keep Rising
Loose monetary policy, demand from emerging markets, and sovereign debt woes could push gold prices to $2,300 an ounce in the coming years, says U.S. Global Investors’ Frank Holmes. By Jeremy Glaser| 6-09-2011 08:08 AM
Jeremy Glaser: For Morningstar, I’m Jeremy Glaser. I’m here at the 2011 Morningstar Investment Conference joined by Frank Holmes. He is the CEO and chief investment officer of U.S. Global Investors. Frank, thanks so much for joining me today.
Frank Holmes: It’s great to be here.
Glaser: So, I wanted to start off talking about gold, and that’s a subject that you’ve written a lot about and that you know a lot about. It’s had just a tremendous run over the past couple of years now. What’s going to take the steam out of this rally? What could take gold prices and kind of bring them back down to earth a little bit?
Holmes: Well, we’re big believers that government policies are precursor to change. When you go back and look at policies where you have negative real interest rates, gold starts to rise in that country’s currency. So, then one has to sit back and say, "Well, why would a government have negative real interest rates?"
It’s because they’ve been fighting deflation, and I’ve been running with this for a decade that gold would go to a $1,000 an ounce because of the battle for deflation.
Further to that, whenever you have negative spending or sort of deficit spending coupled with negative interest rates, gold really starts to perform in that country’s currency. And it’s not the political party, it’s the political policies because, one, in 1997 under President Clinton, there was a surplus budget. Two, there were positive real interest rates, that is, you earn 3% more than the CPI number, and thus gold was $250.
More…




Jim Sinclair’s Commentary
If the Euro failed the Western Banking system would be dragged into insolvency by credit default derivatives. Therefore, the Euro will not fail.

Jim’s Mailbox

June 24, 2011, at 11:38 am
by Jim Sinclair in the category Jim's Mailbox |  Print This Post |  Email This Post

 

Jim,
Here is an important video. Ron Paul pretty much confirms for the record that only half-assed audits have been done. This almost leads to another audit, this time with no partials etc.
CIGA JB Slear

Hearing entitled “Investigating the Gold: H.R. 1495, the Gold Reserve Transparency Act of 2011 and the Oversight of United States Gold Holdings” Thursday, June 23, 2011 2:00 PM in 2128 Rayburn HOB





Jim Sinclair’s Commentary

This is a class comment on yesterday’s government manipulation using, get this, TA.

WHY NOTES FROM UNDERGROUND IS WHERE 2+2=5 IS A BEAUTIFUL THING By Yra
Yesterday, it was such an easy game to play but now the IEA had entered and made it so much harder and it looks as though they’re to stay.
The early morning entry of the IEA into the market pricing of oil has given rise to a slew of conspiracy theories. I care not a damn about the theories but want to analyze the impact of the action and the effect upon the markets. Government actions, no matter how ill-advised, are to be understood and analyzed in the real and potential outcome on world markets.
The Obama Administration has been floating the idea of opening the SPR in an attempt to break the back of financial speculation in the energy and food sectors. It appears that the unilateral move by the Obama Administration would not go down well as many in Congress and elsewhere would have attacked it as an electioneering gimmick to drive down gas pump prices and attack the “locusts” on Wall Street. It seems that the move then became to internationalize the decision by using that “august” body the IEA.
In order to get the major participants to go along I am wondering what deals were made and what potential impact it will have on markets as we go forward. One analyst on TV I think had it very correct: Whoever crafted the action waited until the price of oil was already moving lower and when WTI was at the 200-day moving average, released the announcement so as to get the most price action, as so many long-term traders are geared to that 200-day moving average.
The rationale was that the Libyan crisis had removed 140 million barrels of oil from the market so the supply had to be provided by an international consortium of reserves. A grand alliance and a good headline. Interesting, though, that the U.S. contribution was almost exactly what the BUSH ADMINISTRATION released post-Katrina.
I am not making a statement about the Obama Administration, only trying to understand the market impact. The fact is that POLITICIANS OF ALL LABELS will use whatever tools are at their disposal to maintain power.
More…

House Rejects Measure Approving "Limited" Military Intervention In Libya 

Submitted by Tyler Durden on 06/24/2011 14:04 -0400

Just out:

• HOUSE REJECTS MEASURE TO ALLOW ONLY SOME SUPPORT ACTIONS
• HOUSE VOTES NOT TO RESTRICT U.S. MILITARY ROLE IN LIBYA

The vote was  238 to 180. So does this mean the president is now implicitly violating the War Powers Act? It is getting impossible to follow all the strands of the 5 war fronts that America is successfully finding itself into. Also, does it mean America is now officially at war with Libya? Or does it mean simply that America has unlimited funding to continue its pursuit of "humanitarian" light sweet?

Guest Post: Unforgiven - Part Five 

Submitted by Tyler Durden on 06/24/2011 14:48 -0400

The Fourth Turnings that centered upon an external threat ended with a glorious High. The Civil War Fourth Turning resolution felt more like defeat, with the country exhausted, bitter and angry. All indications are this Fourth Turning will be mainly an internal struggle between the ruling class of bankers, business elites, and politicians and the downtrodden middle class. The lying, cheating, fraud, theft and other wrongs committed by those in power will need to be atoned for. The generational dynamics in place will drive the reactions of the country moving forward. We have been badly led. A vast swath of the populace has lived beyond their means. The existing system is unsustainable. The Boomer generation does not want to yield on their perceived entitlements. The Millenial generation will be saddled with un-payable debts. Generation X is caught in the middle of this generational struggle. The huge imbalances in our society have built up over decades like flood waters behind a weakening levee. When the levee breaks the existing order will be swept away in the raging torrent that will follow. 

 

 

 

 

 

Three Inflationary Case Studies: Coke, Pasta And Rent 

Following what appears to be just the beginning of a major market flush which could well bring the S&P to triple digits in order to serve as a catalyst for QE3, the word inflation has become taboo: after all, it is expected that Bernanke will have snapped his fingers, and the 15 minute count down to deflation will start. Alas, no. There are at least three products in which inflation has proven to be particularly stubborn, all due to a unique set of factors. The first one is Coke (the drink, although probably not isolated thereto), which just announced plans to hike prices 3 yo 4% due to still surging commodity costs. The second is pasta, whose prices are also set to soar, this time due to adverse climatic conditions. Per Bloomberg, "Unrelenting rainfall may have slashed U.S. planting of durum wheat to the lowest level in more than 50 years, fueling a surge in the price of pasta and noodles as mills scramble for supply of the grain." And the last, and possibly most perverse price spike, is the one which will actually hike the CPI, due to an increase in the shelter, or rents, component, as more and more Americans forgo owning a home in exchange for renting, in the process pushing up the one component that accounts for 41% of core CPI. In this way we see three completely unrelated channels in which inflation will continue to push through even as stocks plunge: an event which most MMT theorists always perceive as inherently deflationary. 

 

 

 

 

ES Closes Week Slightly Down As Inverse Volume/Performance Relationship Persists 

Submitted by Tyler Durden on 06/24/2011 16:22 -0400

It is time to restart the clock on the number of consecutive weeks decline in stocks. After last week broke the trend, the just finished one closed slightly down, as three days of taking the escalator higher on vapor volume then reverted to taking the express elevator down on a spike in panicked trading. Net result: about 10 million E-mini contracts in which billions in wealth was transferred, the overall market did not move, and nothing at all has been resolved regarding the global ponzi scheme. 

 

 

 

 

Weekly Bull/Bear Recap: June 20-24, 2011 

The most concise summary of this week's bullish and bearish events. 

 

 

 

 

How Goldman Sachs Gets Stocks It Underwrites on Its “Conviction Buy” List

Posted by: Stone Street Advisors

Post date: 06/24/2011 - 11:33

Its one thing when Investment Banks use optimistic assumptions for revenue growth and margin expansion to "rationalize" a high price for its client's stock. Its another thing entirely to assume a Chinese company has the same level of risk as a U.S. one...

 

 

 

 

The Media Can't Save Barack From Obama Economy

Posted by: Value Expectations

Post date: 06/24/2011 - 11:56

With the Obama economy limping along thanks in part to the Administration’s policies in favor of extreme dollar weakness, there’s growing speculation as to his re-election chances in 2012. 

 

 

 

 

Call This a Warning Sign

Posted by: thetechnicaltake

Post date: 06/24/2011 - 11:29

This is the first real technical warning sign that the market is on the verge of breaking down and the economy is on the verge of a recession.