![[Most Recent USD from www.kitco.com]](http://www.weblinks247.com/indexes/idx24_usd_en_2.gif)
Visit msnbc.com for Breaking News, World News, and News about the Economy
Dear CIGAs,
The dollar is doomed. The dollar is a safe haven for short term short sighted imbeciles.
The Fed cannot and will not stop.
They have no practical means to drain ten cents worth of this massive unprecedented experiment.
As the economy moves back into crisis, even more dollars will be printed.
Now we are bailing out commercial loans. Next is CIT because it cannot and will not be allowed to fail.
If CIT goes, an immediate collapse of the real US economy will be heard all over the planet as the dollar breaks wide open.
Fed Extends TALF Program for Commercial Real Estate
By Scott Lanman
Aug. 17 (Bloomberg) — The Federal Reserve extended by three to six months an emergency program aimed at restarting credit markets, a move that may cushion the commercial real- estate industry from rising defaults and falling prices.
The Term Asset-Backed Securities Loan Facility, with a capacity of as much as $1 trillion, will expire June 30 for newly issued commercial mortgage-backed securities, instead of Dec. 31, the Fed and U.S. Treasury said today in a statement in Washington. For other asset-backed securities and CMBS sold before Jan. 1, the plan was extended three months to March 31.
Commercial property values have fallen 35 percent since peaking in October 2007, according to Moody’s Investors Service. The extension may help firms such as Vornado Realty Trust, which is considering the sale of commercial MBS through the TALF. Almost $165 billion of mortgages for skyscrapers, shopping malls and hotels are due this year.
While financial-market conditions “have improved considerably in recent months,” the markets for ABS and CMBS “are still impaired and seem likely to remain so for some time,” the Fed and Treasury said.
The central bank said it doesn’t intend to make other types of collateral eligible for the program, indicating officials rejected adding residential mortgage-backed securities after considering such a move for several months. The Fed didn’t rule out a future expansion.
Jim Sinclair’s Commentary
Answer: Not a chance.
Can Kenya follow in Tanzania’s gold footsteps?
AIM listed junior, Red Rock Resources, has entered into a deal with Canadian-based Kansai Mining on a Kenyan gold project and is intent on bringing the country back as a significant gold producer in its own right.
Author: Lawrence Williams
Posted: Monday , 17 Aug 2009
LONDON – Red Rock Resources (AIM:RRR) which is perhaps better known for its proposed association in Western Australian manganese and iron ore with Brian Gilbertson’s Pallinghurst and Jupiter Mines, has announced it has entered into a deal with Kansai Mining (TSXV:KAN) which could bring it operating control over the latter’s very interesting Migori gold project in south western Kenya, close to the Tanzanian border.
The Migori project tenements are on the Migori Greenstone Belt lying just north of the Tanzanian border. This belt hosts outcropping gold shows, structures and geochemical anomalies along the entire 68km strike length of the two tenements. It also hosts the famous Macalder copper-zinc-gold-silver volcanic massive sulphide (VMS) deposit, discovered by Falconbridge in the 1930s and mined until the early 1960s. It is one of ten such greenstone belts in the area, eight of which are across the border in Tanzania which has seen dramatic growth in gold exploration and exploitation in recent years. Historically the area has seen a number of gold mining operations.
Under the agreement, Red Rock can acquire up to 60% of Mid-Migori Mining Company, the Kansai subsidiary set up to develop the project and which owns the beneficial title and mining rights of the tenements.
Commenting today, Red Rock chairman Mr Andrew Bell said: "The Tanzanian craton just extends into Kenya, and due in part to its location this Kenyan belt has not attracted attention. There is potential here for the development of a gold field with several million ounces, including surface and high grade zones that can be brought into early production."
Jim Sinclair’s Commentary
Let’s keep our eye on the ball. The Fed cannot stop.
The "stop" has a powerful economic recovery in the formula which will NOT occur.
Fed Faces Its Zimbabwe Moment
Joshua Zumbrun, 08.11.09, 05:45 PM EDT
Is the central bank confident enough about the recovery to take the economy off life support?
WASHINGTON — When stock markets plumbed new lows in March, the Federal Reserve responded with nearly every tool in its box. It announced it would create new money to buy $1.25 trillion in mortgages and $300 billion in government debt.
That purchase of government debt looked particularly ominous. Creating new money to buy government debt is the sort of strategy that’s known to destroy economies–just ask Zimbabwe, which suffered so much hyperinflation that it destroyed its currency. The Zimbabwe central bank printed bills in the denomination of 100 trillion Zimbabwean dollars, then found they had value only as a novelty item on eBay. Eventually, Zimbabwe was forced to abandon its currency altogether.
But the difference between the U.S. Federal Reserve and the Reserve Bank of Zimbabwe (one would hope) is that the Federal Reserve will stop before it wrecks the dollar.
Jim Sinclair’s Commentary
Good proposal! If every CIGA went onto the SEC website comment page and backed this it would overwhelm the commission. Come on now, do something other than bitch!
This sounds like an uptick rule to me. They better hurry because after September the fat lady will have sung.
S.E.C. Floats a Short-Selling Proposal
By FLOYD NORRIS
Published: August 17, 2009
The Securities and Exchange Commission, after months of considering what to do about short-selling, came up with a new idea on Monday that could make it virtually impossible to place an order to sell stock short and be sure it would be executed quickly.
The commission asked for additional comments on that idea, delaying for at least a month the possibility of commission action.
The proposal would require that short sales be made only at a price higher than the current best price being offered by would-be buyers of the stock. It is similar to the so-called tick-test, which was effective on many stock markets before 2007, but would be more restrictive and could be easier to apply given the current structure of markets. There is now no limit on short-selling, so long as the seller can locate shares to borrow.
Short-sellers trade borrowed shares of a stock, hoping to buy them back later at a lower price and pocket the difference.
The latest proposal is not a completely new idea; the S.E.C. suggested it deep in its earlier proposal, but did not request detailed comment on it. That it is now seeking comment could indicate that at least some members of the commission think the approach could be a good one.
Jim Sinclair’s Commentary
There is NO SAFE HAVEN in the US dollar when the finances of the USA are a total disaster.
The bailouts have made things infinitely worse, not better.
More debt at unprecedented levels cures a credit lock up crisis.
Bailing out Wall Street means nothing to the US banking system as a whole. All of this was unnecessary before Lehman failed as then there was a means of preventing this disaster.
NOT now!
Coming Soon: Banking Crisis of Historic Proportions
August 16, 2009
John Lounsbury
With everyone (well, almost everyone – I am one of the lonely skeptics) convinced that we have stepped back from the "edge of the abyss", the title of this article may be viewed as laughable. When you connect the dots, as I will in this article, you will at least stop laughing, and, maybe, realize that we still have a big problem.
We have a confluence of five factors that have the potential to create damage to banking not seen in 80 years, and that includes the Great Depression. We’ll hit these factors one at a time.
First Factor: Banks Are Not Doing Enough Business
Commercial bank credit growth has dropped to 2%, according to Jesse’s Cafe Americain (here). The recent history of credit growth is shown in the following graph.
Now, it is a good thing that banks are conserving capital, since they need to increase capital to offset bad loans.
But, if asset valuations deteriorate (and that is quite possible), the banks need to increase earnings to "earn their way" out of their problem. Interest paid by the Fed for reserves on deposit there (by the commercial banks) are not producing nearly the same level of income as new credit issued commercially under our fractional reserve banking system with much higher interest .
If credit issuance does not increase year over year, banks can not improve their financial condition unless the quality of their existing loan portfolio improves.
As discussed in the third factor, below, just the opposite is anticipated for loan portfolios.
So the first factor in this perfect storm is that the banks are not doing enough business.
The U.S. Banking Crisis Is Just Beginning
August 16, 2009
Jeff Nielson
The dichotomy between the fantasy-world of U.S. business reporting and the real world continues to widen. While the media has unequivocally claimed that “the worst is over” for the U.S. banking sector, the employees and shareholders of the 77 U.S. banks which have already gone belly-up this year might choose to dispute this claim.
Five more insolvent U.S. banks were seized by the FDIC in its weekly salvage operations Friday night. As is becoming increasingly common, even with the large bribes which it offers potential buyers, it couldn’t find takers for all of these bankrupt companies.
Bank bankruptcies have already more than tripled the total for all of last year, and are steadily accelerating. Meanwhile, for a nearly endless list of reasons, the crisis in this sector can only get much worse.
Thanks to the U.S. accounting ‘watch-dog’ – the FASB – legalizing fraudulent accounting (see “FASB strong-armed into mark-to-fantasy accounting”), the “solution” which the bankster oligarchs have come up with to the mass-insolvency of U.S. banks is to simply hide a lot more bad loans. Indeed, fraudulent accounting has become a way of life for the U.S.
It began when the U.S. federal government simply stopped reporting the exponential increase in liabilities from its benefit programs in its own budget – contrary to its own law requiring all of its corporations to report such liabilities.
Jim Sinclair’s Commentary
The Hunt for Red October?
Was there something or somebody on that ship that Russia wanted back badly?
NATO and Russia together seems a tad over the top for a freighter that might have been carrying Vodka where the crew and captain got into the cargo.
Finland denies missing ship carries nuclear material
By Orlando Rodrigues (AFP) – 1 day ago
PRAIA — Finnish authorities dismissed talk Sunday that the Arctic Sea was bearing a cargo of nuclear material, as Russia and NATO joined forces in an international hunt for the missing vessel.
Jukka Laaksonen, head of the Finnish Radiation and Nuclear Safety Authority, said firefighters conducted radiation tests on the ship — last reported off Cape Verde — at a port in Finland before it began a voyage full of intrigue.
But he dismissed as "stupid rumours" reports in British and Finnish newspapers that the ship could be carrying a "secret" nuclear cargo that could explain why it was attacked on the Baltic Sea before vanishing.
"Some fireman for some reason thought that there might be some radioactivity involved in this shipment and that was a very stupid idea. There was no basis for that," Laaksonen told AFP.
Finnish police said Saturday that the ship’s Helsinki-based operator, Solchart Management, had received a ransom demand for the Arctic Sea, raising fresh hopes for its 15-strong Russian crew.
Jim Sinclair’s Commentary
This is not dollar positive. This is a natural development in the downward spiral of my 2006 Formula.
Fed Says Banks Tightened Lending During Quarter Through June
By Craig Torres
Aug. 17 (Bloomberg) — U.S. banks tightened standards on all types of loans in the second quarter and said they expect to maintain strict criteria on lending until at least the second half of 2010, a Federal Reserve Report showed today.
“Domestic banks indicated that they continued to tighten standards and terms over the past three months on all major types of loans to businesses and households,” the Fed said in its quarterly Senior Loan Officer survey. “The net percentages of banks that tightened declined compared with the April survey.”
The report suggests that lenders and borrowers are wary of taking on more risk until the U.S. economy shows clear signs of growth. Most banks expected standards across all loan categories “would remain tighter than their average levels over the past decade until at least the second half of 2010,” the report said.
“Consumer and commercial borrowers have clamped down,” Kevin Fitzsimmons, a managing director at Sandler O’Neill & Partners LP in New York, which specializes in bank research, said before the report. “You just need some economic growth to materialize and then you will see more lending.”
Jim Sinclair’s Commentary
Not this time, but in time Israel will make a serious miscalculation. It will happen.
Israelis shoot Egyptian officer at border
Mon, 17 Aug 2009 10:20:37 GMT
Israeli soldiers on patrol along the Israel-Egypt border have opened fire at an Egyptian security officer, the Israeli army says.
"The soldiers saw a suspect individual approach with a rifle which he was arming. They shot in the air and then towards him," said an unnamed Israeli army spokeswoman on Monday.
The Israeli army radio later announced that the Egyptian man sustained a shoulder wound.
The radio station had initially said the Israelis had returned fire after the Egyptian man shot at them.
According to the Israeli spokeswoman, a joint Israeli-Egyptian team will investigate the incident.
Egyptian officials said 21-year-old Central Security conscript, Abdel Salam Mohamed Abdel Salam, was taken to a hospital where police were waiting for him to regain consciousness.
Jim Sinclair’s Commentary
China is in competition with India as North America sleeps.
Canada’s traditional minerals firms are more interested in business from Hedge Funds.
Tata Steel in talks with 2 mining firms for JV
NEW DELHI: Aiming raw material security primarily for its global operations, the world’s sixth largest steelmaker, Tata Steel, is scouting for iron ore and coking coal mines worldwide and is in talks with two mining firms in Vietnam and South Africa for joint ventures.
“We have an option in a South African iron ore mine to enter into a joint venture with the promoters. This project is currently under evaluation,” Tata Steel said in its annual report for 2008-09.
Tata Steel will also take a minority stake in an iron ore mine in Vietnam to feed its proposed JV steel unit there. ."Tata Steel will take a 30 per cent share in the Thach Khe iron ore mine that is about 60 km from the steel project,” the report added.
The steelmaker in 2007 entered into an agreement with Vietnam Steel Corporation to set up a mill. Tata Steel will have a 65 per cent stake in the JV. The South African mine would primarily cater to its European steel firm Corus, which lacks raw material security.
“The highest priority is being given to … ensuring raw material security for the European operations which do not have captive iron ore and coal resources,” Tata Steel Chairman Ratan Tata said in the report. Tata Steel, however, did not give details of estimated reserves of the two mines. – PTI
Jim Sinclair’s Commentary
Chicago IOUs.
Broke towns.
Broke cities.
Broke states.
Broke country.
Broken currency!
Thank you OTC derivative manufacturers and distributors, present and past.
The dollar is a safe haven? What a shock the mainline thinking and F-TV is going to have.
City Government Closed For Business On Monday
Aug 14, 2009 6:59 pm US/Central
CHICAGO (STNG) ― If you planned to check out a library book, visit a city clinic or have your garbage picked up on Monday, you’re out of luck.
The City of Chicago will basically be closed for business on Aug. 17, a reduced-service day in which most city employees are off without pay, according to a release from the Office of Budget and Management. City Hall, public libraries, health clinics and most city offices will be closed.
Emergency service providers including police, firefighters and paramedics will be working at full strength, but most services not directly related to public safety, including street sweeping, will not be provided, the release said.
That also includes garbage pickup. Residents who receive regular collection on Mondays should expect trash to be picked up the following day, the release said. Some other customers may experience a one-day delay as collectors catch up.
As part of the 2009 budget, three reduced-service days were planned for 2009, days which are unpaid for all affected employees — the Friday after Thanksgiving; Christmas Eve; and New Year’s Eve. The City Council recently approved moving the reduced-service day planned for New Year’s Eve to Monday.
Jim Sinclair’s Commentary
Yes, but will it not be better because it has Czars and the government is running it?
GM: Still Making the Same Mistakes
By Ed Wallace
August 17, 2009 7:08AM
General Motors, you introduce cars far too long before they can be bought. You make promises you can’t keep. And then, instead of building value and driving margins up to where GM returns to profitability, you’re once again diminishing how customers view your products by constantly finding ways to drive the prices down.
Jim Sinclair’s Commentary
Small at first but larger and larger as time passes.
Renminbi business underlines HK’s status: CS
Renminbi business will add to the breadth and depth of Hong Kong’s financial market and underline the city’s strengths as an international financial centre, Chief Secretary Henry Tang says.
Speaking at the launch of HSBC Bank (China) Limited’s renminbi retail bonds offering this afternoon, Mr Tang said Hong Kong plays a strategic role as the Mainland financial market reaches out to the world, adding renminbi business development in the city is one of the most important policy initiatives.
Jim Sinclair’s Commentary
The 43 percent must be employed at Goldman and live in Greenwich, CT.
Poll: 57% don’t see stimulus working
By Brad Heath, USA TODAY
WASHINGTON — Six months after President Obama launched a $787 billion plan to right the nation’s economy, a majority of Americans think the avalanche of new federal aid has cost too much and done too little to end the recession.
A USA TODAY/Gallup Poll found 57% of adults say the stimulus package is having no impact on the economy or making it worse. Even more —60% — doubt that the stimulus plan will help the economy in the years ahead, and only 18% say it has done anything to help improve their personal situation.
That skepticism underscores the challenge Obama faces in trying to convince the public that the stimulus has helped turn the economy around. It also could complicate the administration’s plans to overhaul the nation’s health care system.
"This is a wake-up call for the administration." says House Minority Whip Eric Cantor, R-Va. "People see the stimulus hasn’t worked, and now you want to lay on over $1 trillion in a health care plan."
The administration declined to comment on the poll results.
The stimulus package contains $288 billion for tax cuts and $499 billion in new spending, much of it meant to pay for unemployment and other social services. The $1 billion "cash for clunkers" program was not part of the bill, although its $2 billion expansion comes from stimulus funds.
Jim Sinclair’s Commentary
CIGA Green Hornet says correctly, "It always starts in California and migrates everywhere in the USA."
Those expecting and those on pensions are about to get a nationwide screwing.
Governor wants to revamp battered public-worker pension programs
By Dale Kasler
Published: Monday, Aug. 17, 2009 – 12:00 am | Page 1A
Last Modified: Monday, Aug. 17, 2009 – 7:30 am
Weeks after wrapping up a deal to close a $26 billion budget deficit, Gov. Arnold Schwarzenegger is taking aim at what he calls California’s next great fiscal problem: the state’s battered pension system.
Reviving an idea he floated during budget negotiations in June, Schwarzenegger wants legislation creating a two-tier system that would deliver lower benefits to newly hired public employees – not only state workers but firefighters, police officers, teachers, and other local-government employees.
Along with proposed cutbacks in retiree health benefits, Schwarzenegger says, the plan would save $90 billion over the next 30 years.
The Republican governor says the state’s pension system faces tens of billions of dollars in unfunded obligations and is increasingly unaffordable.
"We cannot continue promising people things that we cannot deliver," Schwarzenegger said at a July press conference.
Jim Sinclair’s Commentary
This will be raid on more bugs than even the ABA knows of.
ABA May Suggest Mutual Funds’ Derivatives Risks Disclosure
08-17-2009 | Source: emii.com
An American Bar Association task force studying mutual funds’ use of derivatives is likely to suggest measures to seek more disclosure of mutual funds’ derivative risks,Investment News reports. The move is aimed at ensuring investors and fund directors are better-informed about the risks involved with the use of financial instruments.
The task force is also mulling whether theSecurities and Exchange Commissionshould impose specific limits on the ability of funds to invest in derivatives that raise leverage. ABA is unlikely to recommend banning the use of derivatives by mutual funds entirely, as derivatives can improve the efficiency of certain investments.
Jim Sinclair’s Commentary
Very soon huge money in the cash gold market is going to squash the gold banks.
Middle East investors join flight to safety of gold
Mon Aug 17, 2009 5:52am EDT
By Amena Bakr – Analysis
DUBAI (Reuters) – Uncertainty over the world economic outlook is changing Middle East gold buying behavior, with individuals seeking bars and coins as a buffer against hard times, rather than snapping up jewelry for aesthetic reasons.
Investors are following those in the rest of the world into gold, partly compensating for lower consumption from the region’s traditional retail demand base.
"People’s confidence in the stock market went down with the financial crisis," said Ahmed Bin Sulayem, executive chairman of the Dubai Multi Commodity Center (DMCC). "Investing in gold right now is a no brainer.
Investment in bullion in the Middle East was mostly coming from individuals, rather than from funds and institutional bodies, said Sampth Muthu, commodities analyst at Standard Chartered Bank Dubai.
The surge in investor demand could be seen across the region, said Jeffrey Rhodes, chief executive of INTL Commodities DMCC, an independent financial firm based in Dubai.
Jim Sinclair’s Commentary
In the car world the Volt is a joke. Cash for Volts is the next car Czar plan.
No turn in, just cash.
Volt Sticker Shock
By Eric Peters on 8.17.09 @ 6:07AM
We live in incoherent times, but maybe someone can explain it to me: How does a $40,000 "economy" car make economic sense?
The $40k is the price GM will reportedly charge for its all-electric Volt sedan — due out in late 2010 as a 2011 model. Unlike current hybrids, which mostly get going on their internal combustion engines — with their battery packs and electric motors providing a supplemental boost — the Volt will be propelled entirely by electric motors and batteries. The small onboard gasoline-burning engine is only there to provide the power to charge the batteries. It is basically a generator — and is not connected to the drive wheels at all.
