Are you prepared to be taxed into the next life? There is no escape moving from broken state to broken state

QE must go to infinity or the Fed will be history.

Jim Sinclair’s Commentary

It is happening everywhere. There is no way out that supports political expedience other than "QE to infinity." If the Fed doesn’t play ball they are history.

The shot caller is political expediency.

Top Bell aide says Toledo likely to face ‘fiscal emergency’
Potential strategy to secure labor concessions disputed
By IGNAZIO MESSINA

Unless there is a fundamental change in the way Toledo’s government operates, the city will likely be unable to pay its employees before the year is through, a top official in the Bell administration warned.

That looming financial disaster leads people such as Mayor Mike Bell and Councilman D. Michael Collins to throw out words like "bankruptcy" or "receivership," two feared terms but ones that are not likely to become reality.

The truth is that receivership or bankruptcy is probably not an option for the city anytime soon. But being slapped by the state as a "fiscal emergency" municipality is a real threat – a label some dislike but others advise Toledo to embrace given its $48 million deficit.

"If you cannot make payroll for 30 days, you are there. You are in fiscal emergency," said Deputy Mayor of Operations Steve Herwat, Mr. Bell’s right-hand man.

"If we don’t get this budget balanced, and the imbalance is enough, and yes it is, we are at risk," he said.

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Jim Sinclair’s Commentary

It is a US epidemic that will guarantee the jobless part of the illusionary recovery.

Cash-strapped LA County courts to begin layoffs
Updated: 03/08/2010 01:23:03 PM PST

LOS ANGELES—The Los Angeles County Superior Court is laying off 329 staff members next month and officials say more than 1,000 others may go in the next two years because of budget cuts.

A memo from Court Executive Officer John Clarke to employees says the first layoffs will begin on April 1.

Clarke says an additional 500 layoffs are planned for September followed by 530 in fall 2011. The court currently has 5,400 employees.

Clarke says civil rather than criminal cases will be hardest hit.

Clark says the court system’s budget deficit is expected to reach $140 million by the 2011-12 fiscal year that begins in July.

Presiding Judge Charles McCoy has said he’s looking at plans to close up to 180 courtrooms and lay off about a third of the staff.

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Jim Sinclair’s Commentary

States, counties, municipalities, cities, villages and hamlets are all broke or going to be soon.

The Fed either produces QE to infinity of the Fed is history.

Counties face more cutting as state income tax payments fall
By Larry Carson
March 9, 2010

The latest state income tax payments to local governments fell $61.8 million year over year, piling new fiscal woes atop budgets already reeling from state cuts, high snow removal costs and earlier revenue declines.

The declines in payments from the state to county governments at the end of February put an added $29.4 million burden on Montgomery County, which was already facing a projected $761.5 million shortfall by June 30, according to the Maryland comptroller’s office.

Prince George’s and Charles counties were alone among Maryland’s 24 jurisdictions to receive more in the fourth quarter of 2009 than in 2008.

Leaders of Anne Arundel and Carroll counties said they were prepared for the bad news and it won’t affect their budgets. Others said the declines will hurt.

"It’s very serious, but there’s been a lot of bad news this year," said Jennifer Barrett, Montgomery County’s finance director. "It makes the gap worse."

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Jim Sinclair’s Commentary

Clearly the EU knows what the weapon used by the Financial Reich to break currencies is.

What can be done when Wall Street owns Washington is debatable. We bailed out an industry so it can break the world.

EU, Merkel Urge Swap Regulation as Greece Takes Plea to U.S.
By Rainer Buergin and Ben Moshinsky

March 9 (Bloomberg) — The European Union’s top regulatory official said the bloc will consider banning “purely speculative” credit-default swaps as German Chancellor Angela Merkel called for a crackdown on derivatives trading to prevent a rerun of the Greek financial crisis.

European Commission President Jose Barroso said today the 27-nation region will “examine closely the relevance of banning purely speculative naked sales on credit-default swaps.” Merkel, speaking before Greek Prime Minister George Papandreou meets PresidentBarack Obama in Washington today, said the EU must take the lead in curbing derivatives.

“We’re of the opinion that a quick implementation of actions in the area of CDS has to happen,” Merkel told reporters in Luxembourg. Citing “ongoing speculation against euro-region countries,” she called for the “fastest possible” implementation of new rules.

European leaders are ratcheting up the pressure for global regulation of derivatives amid the Greek fiscal crisis. The commission, the EU’s executive arm, will also propose creating a lender of last resort to aid cash-strapped members such as Greece, a proposal that has divided the region’s leaders.

Papandreou said in a speech in Washington yesterday that “unprincipled speculators” threatened a new global financial crisis and said he’d press Obama to support EU efforts to target speculation.

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Jim Sinclair’s Commentary

Things are all good in this MOPE induced illusionary oxymoron of a Jobless Recovery. This is certainly true if you are glib and follow the mob with your future.

Nothing has been done to fix the major problem, which is OTC derivatives. In fact they have grown in size if you understand the computer cartoon called value to maturity which assumes everything will mature.

The Swaps That Swallowed Your Town
By GRETCHEN MORGENSON
Published: March 5, 2010

(Excerpt from article)

AS more details surface about how derivatives helped Greece and perhaps other countries mask their debt loads, let’s not forget that the wonders of these complex products aren’t on display only overseas. Across our very own country, municipalities, school districts, sewer systems and other tax-exempt debt issuers are ensnared in the derivatives mess.

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Jim Sinclair’s Commentary

Do what the Chinese do. Do not do what Reuters tells you they will do.

The best book on negotiations in China is "When Yes means No."

China says committed to U.S. debt, wary on gold

(Reuters) – China, the world’s biggest holder of foreign exchange reserves, renewed its commitment to the U.S. Treasury market on Tuesday but said it would be wary of substantially boosting its gold holdings.

China

The country’s chief currency regulator said China would attract more capital inflows this year, partly reflecting expectations of a stronger yuan, but he left the market none the wiser as to when Beijing might let the currency resume its rise.

"The U.S. Treasury market is the world’s largest government bond market. Our foreign exchange reserves are huge, so you can imagine that the U.S. Treasury market is an important one to us," Yi Gang, head of the State Administration of Foreign Exchange (SAFE), told a news conference.

The exact composition of China’s $2.4 trillion of reserves, the world’s largest, is a state secret and the subject of intense scrutiny by global investors aware that, with such large sums at stake, even marginal portfolio shifts have the potential to move markets. Global investors are equally attuned to any clues about the yuan, given its role in China’s trade with the rest of the world and the potential spill-over effect a stronger yuan would have on other currencies in Asia.

Speaking during the annual session of parliament, Yi expressed the hope that China’s presence in the U.S. Treasury market would not become a political football. China, he stressed, was not in the game of short-term currency speculation.

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Gold put in an impressive performance today from where I sit battling back from a barrage of selling linked to the ridiculous story circulating around the market today that China was not interested in buying gold. That initially emboldened the raiders at the Comex and sent the lemmings packing and heading for the hills before saner minds prevailed who began buying into the weakness. The result was a strong bounce from important technical support near the $1,110 level (see the chart for a view and read the comments there).

Let’s state the obvious here – the Chinese NEVER announce their intentions beforehand. Do the investors/traders in this nation believe that they are stupid? Anyone who follows the soybean market can attest to this. As we mentioned last time a story appeared announcing China’s intention to buy the remainder of the IMF gold sale; such a thing would be very uncharacteristic for them. After all, we are not dealing with a Gordon Brown here (the Prime Minister of England who at the time he headed the Treasury there announced beforehand his intention to sell England’s horde of gold thereby guaranteeing that the citizens of his nation would receive the lowest possible price). Rest assured that China has no intention of saying the least thing positive about gold purchases knowing full well that they will create a stampede of buying into the market which would guarantee them the worst possible purchase price.

You might recall that after copper collapsed from over $4.00 all the way down to $1.25 that it was not until it had recovered quite nicely off the bottom that word leaked out that China had been accumulating the red metal for its strategic stockpiles. Did China come in and announce beforehand that they were going to buy gobs of copper? Of course not –it was only after the market began moving higher and kept moving higher and traders were speculating as to what was going on that the truth came out. I remember full well the comments from the analysts at the time who were dumbfounded by the fact that the metal kept moving higher in the face of a collapse in the US housing market and an abrupt shutdown of the US economy. They were all sitting around scratching their heads trying to come up with reasons why the market was going up and not down.

It will be exactly the same for gold. China will buy it and you will not know it UNTIL AFTER THE FACT. The price chart will tell us when the buying is occurring but it will not tell us who is buying. I repeat, the East does not announce their intentions until after the fact. They will accumulate the metal on price weakness whenever Western-based hedge funds are in the process of selling it. If I had to bet on these funds against China, my money would be on the Chinese.

One last comment about this matter – China is still reeling from the fact the India beat them to the market on their gold buys late last year. And do not forget that India is going to be adding more gold to their official reserve holdings at an appropriate price level.

Even if you leave the Chinese out of the gold market – gold has not been making all time record highs in terms of the Euro and the British Pound and 30 year highs in terms of the Swiss Franc because China might or might not buy the metal. It has been doing so because it is functioning as a currency without any obligations attached to it. In other words, China’s actions in the gold market have nothing to do with gold’s string of all time highs in these major currencies. It is fear, uncertainty and a desire for a safe haven that have fueled the metal’s rise. China is just an added bonus which will serve to keep a floor under the metal on price retracements.

The US Dollar continues to struggle with the 81 level on the USDX. It is difficult to make a short term call on this right now. While the bearish divergences continue to flash warning sign after warning sign, the market simply will not break down. One could make a case for the Dollar consolidating here and preparing for another leg higher or getting ready for a fall through major support. The technical case is simply unclear right now as neither the bull camp nor the bear camp has a definite advantage. Bulls need to take it above 81.40 and hold it there while bears need to take it below 79.60 and keep a lid on it there. As stated often – the Dollar is benefiting not because its fundamentals are strong (they stink) but rather because the fundamentals behind Europe are even worse.

The HUI moved higher today following a similar pattern in gold at the Comex as it recovered from its worst levels. It is maintaining its footing above most of the major moving averages with the 100 day serving to hold it on the upside. A push through that level (432) will give it the impetus it needs to move on up towards 450. Support lies first at 415, followed by 410 and then 390.

The S&P 500 continues its merry rise oblivious to any reality as it trades in its own little world of sloshing liquidity. It has managed a move to recapture 50% of the losses since it peaked back in 2007. A strong close today and tomorrow would give the bulls further momentum and give it a shot at moving up towards the 1225 level. If it breaks through there, we might all just as well get out the party hats because according to this screwed up, useless indicator of the US economy, the good times will be here again. You have to shake your head in wonder at how these managed operations can pull stunts like this off. Then again, a few $billion here and a few $billion there, and the next thing you know, you have a bull market in equities. In this day and age of technical analysis, fundamentals are irrelevant. The only thing that matters is momentum.

Bonds are still stuck in their broad trading range of the last 2 months. Bears will gain an advantage if they can close price under the 115^15 level but they will not have gained control over this market unless they can take price down below 114^20. Bulls need to push price back up towards 118^24 to gain the advantage and over 120 to take control. For now, we seem to be at an impasse.

Click chart to enlarge today’s hourly action in Gold in PDF format with commentary from Trader Dan Norcini

Here is another way to look at "QE to infinity or the Fed is history."

Stock investors ask: What’s the next big thing?
CIGA Eric

Stocks have lost some of the momentum that propelled the Dow Jones industrials up 61 percent from 6,547, its close on March 9, 2009. That’s natural — bull markets tend to slow down as they head into their second year. But the economic recovery has also been a bit of a drag on stocks. And so investors are waiting for signs that the economy is ready to put up some solid, sustainable growth numbers.

The media is pushing hard to doing more critical thinking for investors. The game of perceptions is so important that the current rise in stocks couldn’t be anything but a bull market. Yet, hours before this headline, another newsflash suggest that it is too early to clamp down on spending just yet. In other words, this bull market is so weak that a comparison to 1936 to 1937 monetary and fiscal environment, and its "mistakes" were necessary.

White House’s Romer: Too soon for spending clamp-down

The gaping U.S. budget deficit is cause for concern but clamping down on spending immediately would be "pound-foolish" and derail the recovery, a top White House economic adviser said on Tuesday.

The comparison to 1936 through 1937 was surprisingly accurate for headline rhetoric. Still no amount of spending can provide the foundation for secular economic recovery. Previous commentaries Dow 10,000 is meaningless and S&P 500 will finish 2010 poll results discuss why. The illusion created by devaluation will always be smashed by the stark reality of the consequences that result from it. You must stand with resolve through understanding or spin will wear you down, find your weakness and exploit it.

Source: finance.yahoo.com

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US 10-Year Money Flows
CIGA Eric

The US has issued more debt at shorter maturities as foreign lenders continue shorten duration over the years. This trend should continue this week. As a result, tracking the money flows of 7-10 year notes (and shorter maturities) has become just as important as following those of the long bond market.

Money flows have reversed as prices pushed higher in response to the previous bullish setup. If outflows continue, a bearish setup will be generated at what could very well be a lower high.

US 10 Year (7-10 Years) and the Commercial Traders COT Futures and Options Stochastic Weighted Average of Net Long As A % of Open Interest:

Source: treasurydirect.gov

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The gold buzz today was CDS winners demanding payment in gold.

The major weakness of this thought is you can’t demand anything except what the contract calls for at inception.

Novation or unilateral changing or cancelling of a contract is against contract law internationally. This sounds good but lacks legality and functionality.

Nobody knows what collateral if any is required between counter parties trading CDS OTC derivatives.

Yes gold is good collateral for anything and accepted by some exchanges, but it is one hell of a reach to consider all CDS transactions to have gold as collateral. They simply do not.

Jim Sinclair’s Commentary

Factor this article into today’s assumption that the Fed was going reverse repo with the money market funds to drain excess liquidity.

Note the attention today of the Fed’s Sack to the important concept when discussing the sale of the junk the banks stuck the Fed with and how it "should limit any uptick in interest rates from the sales."

Today the Fed MOPEs about draining excess liquidity via reverse repos. If this was enacted it would send interest rates soaring regardless of the economic condition when initiated.

Another interesting point to consider is that if you add all the cash of all money funds together, less losses on inventory, there isn’t enough money there if you used reverse repos to drain the trillions in excess liquidity. Despite this fact, both professionals and public alike buy this illogical propaganda and run with it, making so many gold people question their commitment.

Fed’s Sack backs passive strategy for asset sales
By Greg Robb, MarketWatch

WASHINGTON (MarketWatch) — The "crucial" message from the Federal Reserve to financial markets is that any potential asset sales from the central bank’s enormous holdings of mortgage-backed securities will come in a gradual and passive manner, the No. 2 official at the New York Federal Reserve Bank said Monday.

In a speech to the National Association for Business Economics, the New York Fed’s Brian Sack remarked that this go-slow approach would be easier for the market to digest and should limit any uptick in interest rates from the sales.

To assist frozen credit markets and keep long-term interest rates low, the Fed has amassed a balance sheet of $2 trillion though purchase of government securities and mortgage-backed securities

The central bank also has kept interest rates near zero for more than a year.

Now that financial crisis has eased, the Fed is looking for the exit. This cycle will be more complicated because the Fed wants to hike rates and reduce its balance sheet. Fed watchers are scratching their heads about which move will come first.

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Jim Sinclair’s Commentary

John Embry on Gold and Gold shares.

John Embry: As Confidence Returns, Gold Will Rise
Source: Interviewed by Gordon Holmes, The Gold Report  03/08/2010

The Gold Report caught up with John Embry, Chief Investment Strategist, Sprott Asset Management, to get his thoughts on gold and some mining stocks he favors. Embry, an industry expert in precious metals, has researched the gold sector for over 30 years. Read about why he thinks gold could gain another 30% this year as a greater proportion of the public realizes the degree of difficulty that sovereign debt is in. He believes as confidence in gold returns people will seek an outlet in gold stocks, especially small-cap gold producers and junior explorers with solid projects.

The Gold Report: John, in Investors Digest of Canada you recently said you’re expecting gold to gain another 30% this year.

John Embry: I would say at least 30%. I said that I thought it would be the best year to date. We’ve had nine years consecutive higher year-end prices and the best year in that span for a year’s return was 31%. I think this will be the year that we exceed it in this, the 10th year of the bull market.

TGR: What’s driving this? Why is this year going to be the best year?

JE: I think we’re getting very close to the point when a greater proportion of the public realizes the degree of difficulty that sovereign debt is in. And at that point, when you can’t depend on your government paper as a safe haven, I think that fact puts gold in a much better light in more people’s eyes.

TGR: You might say the first leg down were the individuals who couldn’t pay their mortgages and that caused part of the ‘08 collapse. And now it looks like it’s the government’s.

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Jim Sinclair’s Commentary

You might think that governments have caught on to the Blitzkrieg (CDS OTC derivative) utilized by today’s Financial Reich.

What difference does it make if you bomb Greece to its knees or just break them financially?

With Wall Street in possession of Washington, it will be interesting to see what, if anything, is done about OTC derivatives. Without exception, these are weapons of mass financial destruction.

OTC derivatives are the basis for the present crisis and nothing has been done to curtail them. Therefore, nothing has been done to correct the problem at all.

The crisis is not over at all.

Greece’s Leader Wants to Restrict Speculative Trading
By SEWELL CHAN
Published: March 8, 2010

WASHINGTON — The Greek prime minister on Monday called on the United States and the European Union to crack down on speculative trading, saying that exotic market bets had driven up Greece’s borrowing costs and threatened its effort to ease its debt crisis.

“We will have a very hard time implementing our reform program if the gains from our austerity measures are simply swallowed up by prohibitive interest rates,” the prime minister, George A. Papandreou, said in a speech at the Brookings Institution, at the start of a visit that will include a meeting with President Obama on Tuesday.

In a brief interview after the speech, Mr. Papandreou said he would not rule out turning to the International Monetary Fund for financial assistance, but he expressed hope that such aid, which would be unprecedented in the euro zone, would be unnecessary.

Mr. Papandreou said his meetings in the last few days with Chancellor Angela Merkel of Germany and President Nicolas Sarkozy of France showed that “there is a will for creating some ad hoc mechanism” that would help the country borrow at reasonable costs.

While Greece successfully sold 5 million euros in bonds last week, it has about 20 million euros worth of debt maturing in April and May.

“We haven’t asked for money,” Mr. Papandreou said. “We haven’t asked for a bailout.” What Greece wants, he said, is the ability to “borrow at somewhat similar rates” as other European Union countries, and particularly in the euro zone.

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Jim Sinclair’s Commentary

The up and coming central bank of central banks has spoken.

As long as the CDS market is wide open for business the Blitzkrieg of the financial Reich will continue.

Greek Debt Problems Unlikely to Spread: IMF Head
Published: Monday, 8 Mar 2010 | 3:00 AM ET

The crisis over Greece’s debt mountain is unlikely to spread to other euro zone countries with high levels of public debt, International Monetary Fund (IMF) managing director Dominique Strauss-Kahn said on Monday.

In an interview with Reuters in the Kenyan capital, Nairobi, Strauss-Kahn dismissed market speculation of potential default by other heavily indebted euro zone countries such as Portugal, Spain or Ireland as scare-mongering.

"You can add to the list all of the countries in the euro zone, to try to scare people about everything. I don’t think it will happen," he said. "We have a problem with Greece. We don’t have a problem with Spain to date. The euro zone has to deal with the Greek problem. They are doing this. No one knows what’s going to happen tomorrow morning but there’s no reason why the spillover to Portugal or to Spain will take place."

Separately, Strauss-Kahn, who is on a tour of Kenya, South Africa and Zambia to see how the poorest continent has bounced back from last year’s global economic crisis, said he was confident euro zone countries could handle the Greek debt maelstrom.

Greek Prime Minister George Papandreou said last week he might have to go to the IMF to meet debt obligations falling due in April if the European Union did not help with funds. It would be the first bailout in the history of the euro.

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Jim Sinclair’s Commentary

The major client for these has been the denizens of Wall Street with the FDIC sharing losses, or should I say functionally guaranteeing against losses.

Failed Banks May Get Pension-Fund Backing as FDIC Seeks Cash
March 08, 2010, 1:00 PM EST
By Dakin Campbell

March 8 (Bloomberg) — The Federal Deposit Insurance Corp. is trying to encourage public retirement funds that control more than $2 trillion to buy all or part of failed lenders, taking a more direct role in propping up the banking system, said people briefed on the matter.

Direct investments may allow funds such as those in Oregon, New Jersey and California to cut fees for private-equity managers, and the agency to get better prices for distressed assets, the people said. They declined to be identified because talks with regulators are confidential.

Oregon’s retirement fund may contribute $100 million as regulators seek “the support of state pension funds to solve the crisis surrounding ongoing bank failures,” Jay Fewel, a senior investment officer at the Oregon State Treasury, said in a presentation at the fund’s Feb. 24 meeting. New Jersey’s fund may also participate, said Orin Kramer, chairman of New Jersey’s State Investment Council.

The FDIC shuttered 140 lenders last year and expects the tally may be higher in 2010. Regulators have avoided signing up private-equity firms as rescuers on concern that they might take too much risk. Pension funds, whose 100 largest members manage $2.4 trillion, could provide capital to acquire deposits and outstanding loans from collapsed banks, according to the people.

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Jim Sinclair’s Commentary

The US, state by state and most unfortunately, are going down according to the Formula of 2006.

No amount of media hype can prevent this.

Nevada lawmakers’ reliance on temporary fixes creates $3 billion hole
By Anjeanette Damon • March 7, 2010

In the nearly three years since Nevada’s economy crashed, lawmakers have scrapped together a patchwork of temporary fixes to the state budget, hoping an eventual recovery would rescue them from being forced to make permanent choices on how they tax and what they spend.

But the economy didn’t get better. It got worse.

The result: Lawmakers will now face a nearly a $3 billion hole in a roughly $6 billion budget when they return to Carson City next year. And the temporary fixes have all been used up.

"The stuff we just went through is easy compared to what we face in the next regular session," state budget director Andrew Clinger said of the special session that ended last week. "What we just did was not easy, but relatively speaking, the task we have in front of us is 10 times what we just did."

Some argue the enormity of the hole, coupled with cuts that will bite a wider swath of Nevadans will force lawmakers to face permanent reform, weaning the state from its dependence on a single industry for more than half of its revenue.

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Jim Sinclair’s Commentary

The hype today was that since the Chairman was approved to maintain his position, the Fed re-established its power.

The real story is QE to infinity or the Fed is history.

Battle Inside Fed Rages Over Bank Regulation
By JON HILSENRATH
MARCH 8, 2010

The worst of the banking crisis may be long over, but the political contest over the Federal Reserve is entering a crucial phase in which its personality and role will almost certainly be redefined.

The Fed has tried to fend off very public efforts in Congress to strip it of responsibility for regulating America’s banks, but a less-visible battle has been playing out inside the central bank. The Fed has undertaken a wrenching reorganization of its army of 3,000 bank supervisors, which has centralized more power in Washington and sometimes pitted officials at the 12 regional Fed banks against those in the capital.

Fissures at the central bank boiled over last year in a meeting in the boardroom of a Fed branch office in Memphis. The presidents of the regional banks, which dot the country from Boston to San Francisco, complained to Fed Vice Chairman Donald Kohn that the Fed’s Washington bank-supervision group was adrift and not providing the district banks needed guidance on how to navigate a worsening banking crisis. Soon, though, Washington was more involved than ever. In one example: The Atlanta Fed was subjected to an especially thorough critical review of its performance as a regulator because of the large number of bank failures in the Southeast.

"The stress level of the past few years has been pretty high," says William Estes, 60 years old, who retired as head of the Atlanta Fed’s bank-supervision group. The group has since been reorganized. "At a certain point you’ve just had enough."

Though partly a turf war, the fight over—and within—the Fed is much more than that. It is part of a broad battle over how America’s financial system should be regulated, still unresolved 18 months after it stood at the brink. The ultimate outcome could shape finance as much as anything since the 1930s, when the Federal Deposit Insurance Corp. was created, or the 1990s, when banks gained freedom to cross state lines and build trading desks to compete with Wall Street.

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Jim Sinclair’s Commentary

The plight of the states of the USA will guarantee the jobless part of the so called recovery.

Bleak future predicted for Michigan schools
By CHRIS CHRISTOFF
Posted: 12:06 p.m. March 8, 2010

LANSING – Michigan public schools will lay off thousands of employees and more than 100 districts could be insolvent if the state doesn’t find a way to plug a $400-per-pupil funding shortfall in funding next year.

That assessment comes today from a coalition of education groups that urged the Legislature to resolve what they call a school funding crisis by July 1, the start of a new fiscal year for schools.

Save Our Students (SOS), a coalition of 17 associations that represent school and school officials statewide, released results of a survey of 300 of the state’s 540 school districts that paints a bleak picture of 4,000 additional layoffs statewide next year, school closures and elimination of programs.

The survey indicates 47 school districts could deplete their fund reserves this year, and another 60 to 80 could do so next year, said David Martell, executive director of Michigan School Business Officials. Emptying reserves could result in insolvency, Martell said.

Tom White, SOS chairman, gave 50-50 odds that the Legislature will tackle the school funding issue in a timely manner.

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Thought For The Day:
When you see the CRIMEX operating the price of gold on the hogwash of draining excess liquidity from the system please recall the statement of our two CIGAs at the Toronto meeting.
One was from Poland and the other from Russia. They had not come together. Each stood up and said how it is possible that people do not see the signs everywhere.
The handwriting is on the wall. This is exactly what we saw in Russia and Poland before the great inflation.
Keep in mind that hyperinflation is a currency event, not an economic event.

Jim Sinclair’s Commentary
The US Treasury and Federal Reserve have guaranteed more than they can ever perform on at present dollar value. That is a trigger to QE to Infinity.
Frank retreats on debt
By PAUL THARP
Last Updated: 3:30 AM, March 6, 2010
Powerful lawmaker Barney Frank had to pull his foot out of his mouth yesterday.
The Massachusetts Congressman rattled investors when he said the US Treasury won’t be responsible for bailing out investors holding the more than $5 trillion of mortgage-linked securities issued by Fannie Mae and Freddie Mac — the ailing mortgage companies at the center of the junk mortgage crisis.
"Please don’t think this [debt] is federally guaranteed, I don’t think it is, I don’t think it should be, I don’t feel any obligation to bail you out," he said. In a restructuring of the firms, investors could expect a "whole range of options. . . from [being paid] nothing to a haircut to whatever."
Hours later, the Treasury rejected Frank’s views, saying it stands behind its unusual Christmas Eve pledge to back the securities with unlimited funds. After the rebuke, Frank, chairman of the powerful House Financial Services Committee, then backpedaled from his statement in hopes of cooling any possible volatility in trading next week.
But even in backtracking, Frank was defiant. "I have noted that Fannie and Freddie debt did not have the same legal standing as Treasury debt. This does not prevent the Treasury from treating the debt of Fannie and Freddie in the manner that it believes best supports the important goal of stabilizing the financial system."
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Jim Sinclair’s Commentary
Questions:
1. What exactly does the Fed wants to repo to money funds? The recent initiative was for the junk it had bought from the failing banks.
2. They might believe the jobless recovery and new normal, but any attempts to drain will be met by a surge in interest rates and a lower low in the economy. That makes draining impractical in a political sense.
In Conclusion:
There is no PRACTICAL means of draining the huge liquidity injected into the system.
Fed to Include Money Funds for Reverse Repos (Update1)
By Liz Capo McCormick
March 8 (Bloomberg) — The Federal Reserve Bank of New York said it will expand the number of counterparties used when the central bank begins to drain the record amount of cash added to the financial system to include domestic money market funds.
The additional firms to be used for reverse repurchase agreements are “intended to enhance the capacity of such operations to drain reserves beyond what could likely be conducted through” the use of the central bank’s 18 primary dealers, the New York Fed said in a statement today. The firms won’t be eligible to participate in other transactions conducted by the New York Fed.
“This is another step in the laying of the groundwork in what will eventually become policy normalization,” said Dan Greenhaus, chief economic strategist at Miller Tabak & Co. in New York. “The private markets have long known the Fed would have to expand eligible counterparties. It’s a good thing in the respect that the Fed recognizes that they have to do this.”
Fed policy makers are debating how to withdraw the emergency programs aimed at reviving the economy without disrupting financial markets or bank liquidity as the recovery gains strength. Along with raising the overnight bank lending rate, Fed officials have said they may use reverse repos, pay interest on excess bank reserves and sell securities directly to investors to withdraw or neutralize cash in the banking system.
Counterparty Criteria
In a reverse repo, the Fed lends securities for a set period, draining cash from the banking system. At maturity, the securities are returned to the Fed, and the cash to the primary dealers.
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Jim Sinclair’s Commentary
When you buy on to the Fed doing reverse repos to drain excess liquidity utilizing money market funds, how practical can any draining be in the following circumstance.
U.S., China In Chess Game Over Debt
Expert: China ‘lacks the flexibility to wield any influence’
Gary Feuerberg
WASHINGTON—Last month, the U.S. Treasury Dept. revealed that China sold a record amount of Treasury bonds last December, raising a question over how China—a top hold of U.S. debt—could potentially alter the fortune of the U.S. economy.
Economists are increasingly worried over the nation’s dependency on China to finance its debt, and China’s recent signals that it may be shifting away from the U.S. dollar as a reserve currency. In addition, China is notorious for actively manipulating the value of its currency to sustain wide trade imbalances with developed nations.
“China has pursued mercantilist policies to promote its interests and increase our dependence on their production and their capital … China has emerged from the global recession stronger than ever, expecting its status as America’s banker to convey new political power,” said Michael Wessel in his opening remarks at the U.S.-China Economic and Security Review Commission last month. “The United States government … cannot easily extricate itself from its growing financial dependence on China.”
Wessel’s statement set the general tone for the hearing, but most of the experts who testified took exception to the notion that China is “America’s banker.”
“While the exact amount is not knowable based on publicly available information, a reasonable working assumption would be that China owns close to $1 trillion of U.S. Treasury securities,” testified Dr. Simon Johnson from the Peterson Institute for International Economics.
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The big mover in gold today was news that the Fed will increase the number of counterparties that they can do these so-called, “reverse repos” with. That was interpreted by some traders as a hint that tightening is on its way. That led to chatter that some would opt towards holding Treasuries and other interest rate products. Maybe that explains why bonds moved higher today with all those folks rushing in to buy them and sell gold. Whoops, bonds fell today. So much for plan A.

As long as I have been at this game I am still amazed at how easily some traders are led around by their noses by the monetary officials. Serve up the claptrap, ring the dinner bell, and Pavlov’s dogs salivate and begin barking. The only thing keeping this economy from flatlining right now is low interest rates and copious amounts of liquidity with which the banks can goose the US equity markets higher. The “good news” that another 36,000 jobs evaporated last month is certainly reason for the Fed to start attempting to suck that liquidity out of the economy isn’t it? These same carnival barkers are ever quick to remind us how inflation is under control and was it just a week or two ago that Bernanke himself admitted that interest rates are going to need to stay low for an extended period of time? How soon we forget.

There was also some mixed sentiment in regards to Greece’s economic woes which brought in a bit of short covering in the Euro and the Swissie. Sterling still could not manage a bounce even with the rest of Europe a bit higher. To say that the Pound stinks would be an insult to birds. They cannot smell but even the pigeons appear to be pooping on it. That is pretty bad.

I would have preferred to see gold maintain its footing above what was former resistance near the $1,130 level but it did not. Still, the bulls have the short term advantage and will maintain that as long as they can hold price above $1,110. A push through that level that cannot regain it before the pit session closes will make some of the weaker longs nervous and give the bears a bit of an advantage. Only if price drops below $1,080 -$1,074 will bears be able to growl.

The HUI held up better than gold bullion did today in a further sign that more of those hedge fund spreads are continuing to be unwound. That is a very fluid situation so I will continue to monitor developments along that front. For now, the HUI is holding well above the major moving averages with the shorter ones moving higher. I would like to see that index hold above 406 on any setback in price.

The Dollar has still not managed to get a close above the 81.00 level on the USDX. The market appears to be in a truce between both bulls and bears right now. The bears will need to take it down below 79.60 to rout their foes while the bulls need to punch through and hold it above 81.20 to force more short covering.

Click chart to enlarge today’s hourly action in Gold in PDF format with commentary from Trader Dan Norcini

The following is the first half of a two part interview completed this weekend with Eric King of www.KingWorldNews.com. Part two will be released later this week.

Click here to listen to part one of the interview…

QE to infinity or the Fed is history.

Draining reserves during this administration is a sick joke.

Regards,
Jim

Program Will Pay Homeowners to Sell at a Loss
CIGA Eric

In an effort to end the foreclosure crisis, the Obama administration has been trying to keep defaulting owners in their homes. Now it will take a new approach: paying some of them to leave.

This latest program, which will allow owners to sell for less than they owe and will give them a little cash to speed them on their way, is one of the administration’s most aggressive attempts to grapple with a problem that has defied solutions.

Classic. U.S. taxpayers not only own the bad loans of GM, AIG, GMAC, et. al, but also the collateral behind them. While the Fed speaks of draining liquidity from the system, the words are shattered by political necessity of infinite liquidity. There will be consequences to these actions.

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Japense Yen
CIGA Eric

As the media debates various agendas, the markets resolve their own. No one, individual or group, is bigger than the market. Follow it, or get out of the way.

The Bank of Japan (BOJ) may be talking down the Yen, but the tape has yet to support it. That which cannot go down with force will reverse and attempt to go up with force. Looks as if two of the "three taps and out" have been booked.

Japanese Yen ETF (FXY)

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Treasuries Replace Munis as Brown Brothers Sees Value (Update3)
CIGA Eric

Muni bonds are losing favor as state and local governments raise taxes to fund the record $18.5 billion in budget gaps estimated in a National Governor’s Association survey.

Local municipalities have big budget holes to fill; some of these holes are "Greece-like" in size. The fact that no one wants to talk about it doesn’t mean that the problems go away.

Source: bloomberg.com

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New Normal Becomes Old Normal as Exports Propel U.S. Recovery
CIGA Eric

The “new mix” is out to topple the “new normal” as the paradigm for America’s economic future.

The 5.9 percent annualized surge in fourth-quarter growth — the fastest since 2003 — was powered more by exports and business investment than the traditional drivers of consumption and housing. This new mix of demand will boost the economy by 3.7 percent in 2010 and pave the way for 3.5 percent annual average increases thereafter, said Joseph Carson, an economist at AllianceBernstein in New York, who coined the phrase.

Talk is cheap. Long-term export growth must be lead by investment rather than devaluation. A breakdown of GDP reveals that domestic private investment, though bouncing from extremely depressed levels in the fourth quarter, remains firmly entrenched within a secular down trend. The new normal of currency devaluation, coined beggar thy neighbor policies in the second Great Depression, fosters only temporary allocation shifts or the size of the slice within economic pie representing the global economy. It does little to grow the size of the pie for everyone.

Source: bloomberg.com

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OTC derivatives are themselves an ABUSE. They are the new Blitzkrieg of the Financial Reich.

CDS have declared war on the Greeks and in time will get around to everyone.

What makes you think Greece is the only country that utilized these venomous instruments? What do you think killed Iceland?

OTC derivatives marketed out of London killed Iceland so the big wigs of Iceland see no reason to pay back depositors. The vote was a plausible denial for those up top in Iceland.

Other than making these instruments a capital crime, as the Chinese have, there is no stopping them.

"Money has no motherland; financiers are without patriotism and without decency; their sole object is gain."
–Napoleon Bonaparte, 1815

Volcker Criticizes Greek Budget Derivatives ‘Abuse’ (Update1)
By Rainer Buergin

March 6 (Bloomberg) — White House adviser Paul Volcker said the “abuse” of derivatives to hide the size of Greece’s budget deficit highlights the need for regulation and European Central Bank President Jean-Claude Trichet said derivatives still pose risks to financial stability.

“Surely the recent revelations about the use (and abuse) of complex derivatives in obscuring the extent of Greek financial obligations reinforces the need for greater transparency and less complexity,” Volcker said in the text of a speech to the American Academy in Berlin, a transatlantic research institute. Speaking at the same event, Trichet said “what I fear really is that we are currently underestimating the systemic instability which is associated with” derivatives.

European and U.S. officials are examining the role that investment banks including Goldman Sachs Group Inc. may have played in Greece’s debt crisis, joining an outcry in the European Union over whether swaps contracts helped conceal the size of its deficit. Goldman Sachs helped Greek officials raise $1 billion of off-balance-sheet funding in 2002 through swaps, which EU regulators said they knew nothing about until last month.

German Chancellor Angela Merkel, who said on Feb. 18 it would be a “scandal” if banks helped Greece massage its budget, called for restrictions on derivatives to halt “speculators.”

“Credit-default swaps, where you insure your neighbor’s house just to destroy it and make money from it, that’s exactly what we have to curb,” she said yesterday at a press conference in Berlin with Greek Prime Minister George Papandreou.

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Jim Sinclair’s Commentary

Credit default swap OTC derivatives are weapons of real warfare. They are already operating against US state debt.

Soon states will be falling like bowling pins. The US dollar will follow as it drops below .7200.

Cash-Strapped States Delay Paying Income-Tax Refunds
On Friday March 5, 2010, 12:23 pm EST

This year, more Americans and businesses may be asking: Where’s my tax refund?

That’s because cash-strapped states such as North Carolina, Alabama and Hawaii have been forced to slow down issuing income tax refunds to individuals and businesses because of a lack of funds in their budget.

Kansas has hinted that a delay might be possible, and processing paper refunds in Iowa has slowed because the state doesn’t haven’t enough employees to get them processed faster.

Another state, New York, is still considering whether they’ll follow the likes of Hawaii and delay refund payments.

"States typically do this when they are tight and they don’t have a budget in place," said Karla Dennis, CEO of Cohesive, a nationwide tax preparation firm. Things are dire at many states: forty-one states are expected to have mid-year budget gaps totaling $37.7 billion, according to the Center on Budget and Policy Priorities.

Delaying the refund, Dennis says, "gives the state funds to work with in the interim to fill a gap in their revenues."

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Jim Sinclair’s Commentary

Breach of contract is what you would sue for when an OTC derivative fails to perform.

If Greece fails the credit default swaps on Greek debt would fail en masse.

Citi sues Morgan Stanley over CDS, claims $245 million

(Reuters) – Citigroup Inc (C.N) sued Morgan Stanley (MS.N) on Friday for breach of contract, saying the Wall Street firm owed it $245.4 million for protection it bought on a loan.

Citibank bought a credit default swap (CDS) from Morgan Stanley & Co International in 2006 on a $366 million revolving credit facility it provided to an issuer of collateralized debt obligations (CDO), according to the complaint filed in U.S. District Court in Manhattan.

The swap obliged Morgan Stanley to pay Citibank the money as a result of a payment default on the credit facility to the CDO, known as Capmark VI, it said in the complaint.

Liquidating the CDO collateral did not cover the entire amount, and Citibank said it exercised its right under the CDS to have Morgan Stanley make up for the shortfall, but it refused, according to the complaint.

Citibank paid Morgan Stanley about $750,000 for the CDS, according to the complaint.

Morgan Stanley could not immediately be reached for comment.

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Dominique Strauss-Kahn, the head of the International Monetary Fund, suggested Friday the organization might one day be called on to provide countries with a global reserve currency that would serve as an alternative to the U.S. dollar.

What will come as a surprise is not only how fast "one day" arrives but also which currency is selected by the market.

Purchasing Power of the USD:

Source: abcnews.go.com

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Hi Jim,

The Gold Currency Index is now testing the all-time highs of last December on the weekly chart. A close well above current levels on a weekly basis would reconfirm the secular uptrend and predict a move up to new highs.

Best,

CIGA Erik
Prometheus Market Insight
http://www.prometheusmi.com

Here is the mantra of OTC derivative credit default swap manufacturers:

"When a government is dependent upon bankers for money, they and not the leaders of the government control the situation, since the hand that gives is above the hand that takes… Money has no motherland; financiers are without patriotism and without decency; their sole object is gain."
–Napoleon Bonaparte, 1815

Jim Sinclair’s Commentary

The US dollar is not a safe haven. The Chinese do not speak to hear their own voice.

China ready to end dollar peg
The head of China’s central bank has given the strongest signal yet that the country will move away from pegging its currency to the dollar, but he said any changes would be gradual.
By Garry White
Published: 5:31PM GMT 06 Mar 2010

At the annual session of the legislative National People’s Congress in Beijing, Zhou Xiaochuan, governor of the People’s Bank of China, said that the days of the “special yuan” policy were numbered. He described the dollar peg as a “temporary” response to the global financial crisis, but gave no timescale for any change in policy. The currency has been pegged at about 6.83 yuan per dollar since July 2008.

Many economists expect China to allow the yuan to appreciate slightly this year, but the cautious tone by Mr Zhou means that any change may not happen for some time. He said that the central bank would maintain the “basic stability” of the currency. So, despite the fact that the Chinese economy grew by 10.7pc in the fourth quarter of last year, the country’s loose monetary policy looks set to continue.

“If we are to exit from irregular policies and return to ordinary economic policies, we must be extremely prudent about our choice of timing,” Mr Zhou said. “This also includes the [yuan] exchange rate policy.”

China’s currency policy has been subject of fierce debate, particularly in the US and Europe, with the country’s central bank accused of keeping the yuan artificially low to promote a domestic exports boom. An artificially lower currency makes the country’s goods and services more competitive, leaving other exporters at a disadvantage. Jim O’Neil, Goldman Sach’s chief economist, thinks the Chinese should allow their currency to appreciate by as much as 5pc.

In recent week President Obama has been vocal on the issue of the artificially low currency. “China and its currency policies are impeding the rebalancing [of the global economy] that’s necessary,” Mr Obama told Bloomberg last month. “My goal over the course of the next year is for China to recognize that it is also in their interest to allow their currency to appreciate because, frankly, they have got a potentially overheating economy.”

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Jim Sinclair’s Commentary

Keep in mind that this is coming along with the IMF as the central bank of central banks.

Head of IMF Proposes New Reserve Currency
IMF’s Strauss-Kahn suggests IMF may one day provide global reserve asset
By HARRY DUNPHY Associated Press Writer
WASHINGTON February 26, 2010 (AP)

Dominique Strauss-Kahn, the head of the International Monetary Fund, suggested Friday the organization might one day be called on to provide countries with a global reserve currency that would serve as an alternative to the U.S. dollar.

"That day has not yet come, but I think it is intellectually healthy to explore these kinds of ideas now," he said in a speech on the future mandate of the 186-nation Washington-based lending organization.

Strauss-Kahn said such an asset could be similar to but distinctly different from the IMF’s special drawing rights, or SDRs, the accounting unit that countries use to hold funds within the IMF. It is based on a basket of major currencies.

He said having other alternatives to the dollar "would limit the extent to which the international monetary system as a whole depends on the policies and conditions of a single, albeit dominant, country."

Strauss-Kahn, a former finance minister of France, said that during the recent global financial crisis, the dollar "played its role as a safe haven" asset, and the current international monetary system demonstrated resilience.

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Jim Sinclair’s Commentary

A jobless recovery is a world class oxymoron.

Economists: Another Financial Crisis on the Way
Nonpartisan Group Led by Nobel Winner Calls for Stronger Financial Reforms
By MATTHEW JAFFE
March 2, 2010

Even as many Americans still struggle to recover from the country’s worst economic downturn since the Great Depression, another crisis – one that will be even worse than the current one – is looming, according to a new report from a group of leading economists, financiers, and former federal regulators.

In the report, the panel, which includes Rob Johnson of the United Nations Commission of Experts on Finance and bailout watchdog Elizabeth Warren, warns that financial regulatory reform measures proposed by the Obama administration and Congress must be beefed up to prevent banks from continuing to engage in high-risk investing that precipitated the near-collapse of the U.S. economy in 2008.

The report warns that the country is now immersed in a "doomsday cycle" wherein banks use borrowed money to take massive risks in an attempt to pay big dividends to shareholders and big bonuses to management – and when the risks go wrong, the banks receive taxpayer bailouts from the government.

"Risk-taking at banks," the report cautions, "will soon be larger than ever."

Without more stringent reforms, "another crisis – a bigger crisis that weakens both our financial sector and our larger economy – is more than predictable, it is inevitable," Johnson says in the report, commissioned by the nonpartisan Roosevelt Institute.

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Jim Sinclair’s Commentary

This chart with input from my old friend Simon at Brooks Hunt tells the story of China.

Jim Sinclair’s Commentary

Here in CT you could cut an offering price by 50% and still not see a buyer.

There is no such thing as a "Jobless Recovery." That is a world class oxymoron only believed by morons.

Norwich-area foreclosures, delinquencies continue to mount
By JAMES MOSHER
Posted Mar 04, 2010 @ 11:49 PM

Mortgage foreclosure and delinquency rates in Norwich/New London rose in January, another sign economic recovery remains elusive for Eastern Connecticut.

The pattern is likely to persist, one market expert said.

Yet the Norwich foreclosure rate remains below the national average.

The rate of foreclosures in Norwich/New London was 2.35 percent in January, up from 1.61 percent a year earlier, according to First American CoreLogic, a California-based company that tracks home sales, price trends and foreclosures. The January national rate was 3.19 percent.

While he is relieved Eastern Connecticut’s most populated region remains below national foreclosure rates, John Bolduc, CEO of the Eastern Connecticut Association of Realtors, doesn’t expect the problem to lessen in the near future.

‘Not out of the woods’

“This is going to be a problem for the next year or so,” he said. “We’re not out of the woods yet.”

The issue likely will get plenty of discussion Saturday at the association’s Home Buyer and Seller Fair at the Holiday Inn. Norwich U.S. Rep. Joe Courtney, D-2nd District, is scheduled to make a 2:30 p.m. appearance and may speak about the foreclosure situation, Bolduc said.

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Jim Sinclair’s Commentary

The popular delusion of the dumbed down crowd is a "Jobless Recovery.’ That one will get filed with the 1931 "Plateau of Prosperity" or maybe the "Goldilocks Economy."

How do people buy these propaganda terms? What do you think the newest one, "PIGS" was created for?

Remember "Rear View Mirror Events" as applied to any economic statistic that might have suggested what we are going through now was coming?

Rise in Valley pre-foreclosures dulls hopes for recovery
Catherine Reagor,
The Arizona Republic – Mar. 2, 2010 05:25 PM

Pre-foreclosures in metropolitan Phoenix climbed in February, dashing hopes that the housing market is starting to recover from the crash.

In January, pre-foreclosures, known as notice-of-trustee sales, fell to their lowest level since late 2008. The significant drop had some housing-market watchers hopeful more lenders were working with borrowers on loan modifications early on and more borrowers could afford their monthly mortgage payments.

But in February, there were 7,604 pre-foreclosure notices filed by lenders in metro Phoenix, up from the 6,762 in January, the Information Market reports.

Foreclosures did fall last month, to 4,271 from 4,452 in January. But if the many struggling homeowners in pre-foreclosure can’t work out loan modification or short-sale deals with their lenders, foreclosures are bound to climb again in the next few months.

Home prices

Prices for both foreclosure homes and regular homes in metro Phoenix are ticking up, according to data from Phoenix-based NetValueCentral Inc.

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Jim Sinclair’s Commentary

Goldman Sachs executives have armed themselves according to media reports. Maybe Moody’s might consider it as their impact becomes international.

Moody’s Cuts Ratings On Seven Abu Dhabi Companies
Thursday, Mar 04, 2010
By Nour Malas

DUBAI (Zawya Dow Jones)–Moody’s Investors Service Inc. Thursday downgraded the ratings of seven Abu Dhabi-based companies by a notch or more saying there’s "no explicit formal" government guarantee to support them, after being prompted to put them on review in December because of restructuring at Dubai World.

In an emailed statement, Moody’s said it lowered Mubadala Development Co.; International Petroleum Investment Co., or IPIC; Tourism Development and Investment Co., or TDIC; Abu Dhabi National Energy Co., or Taqa; Emirates Telecommunications Co., or Etisalat; Dolphin Energy; and Aldar Properties.

The rating on Aldar, Abu Dhabi’s largest developer, moved from investment grade to speculative grade, or junk.

Moody’s said it placed "a moderate distinction" between the ratings of Mubadala, IPIC, TDIC and sovereign Abu Dhabi, describing the companies as "vehicles of government policy" that remain heavily funded by the government. All three companies previously held ratings in line with Abu Dhabi’s.

Moody’s placed a greater distinction between the ratings of Taqa, Dolphin, and Aldar and sovereign Abu Dhabi, citing a lack of either continued, regular, or expected support from the government.

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Jim Sinclair’s Commentary

One more added to the list.

Venezuela Central Bank to Increase Gold Purchases, Khan Says
By Corina Rodriguez Pons

March 5 (Bloomberg) — Venezuela’s central bank will boost its gold reserves this year and will buy more than half the estimated 20 metric tons of domestic production, bank director Jose Khan said today at an event in Caracas.

The central bank, which has about $16 billion of its $30.6 billion of reserves in gold, purchased 1.08 tons of gold from domestic mines in the first two months of this year after buying just 2 tons in all of 2009, said Khan, one of five directors at the country’s monetary authority.

“We’re going to increase our gold reserves and buy more local production,” Khan said today. “Our objective is to increase reserves and help develop the local gold industry.”

Venezuela’s central bank is planning to provide $250 million of financing for gold production this year in an attempt to boost non-oil exports. The bank, along with the Mining Ministry, plans to build a gold refinery, bank President Nelson Merentes told reporters March 3, without providing details.

Gold futures for April delivery rose $2.10, or 0.2 percent, to $1,135.20 an ounce on the Comex division of the New York Mercantile Exchange. The metal gained 1.5 percent this week.

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Jim Sinclair’s Commentary

Four bank closings so far this weekend. The sheeple simply sleep on.

Bank Closing Information – March 5, 2010

These links contain useful information for the customers and vendors of these closed banks.

Centennial Bank, Ogden, UT
Waterfield Bank, Germantown, MD
Bank of Illinois, Normal, IL
Sun America Bank, Boca Raton, FL

Jim Sinclair’s Commentary

A "Jobless Recovery" is an insult to the intelligence of those that possess this rare quality.