Saturday, August 16, 2008



Friday, August 15, 2008


U.S. mint suspends gold coin sales; futures price is a fiction Submitted by cpowell on Fri, 2008-08-15 04:27. Section: 12:25a ET Friday, August 15, 2008 Dear Friend of GATA and Gold: The U.S. Mint has suspended sales of American eagle gold coins and is refusing orders from dealers, two coin and bullion dealers confirmed Thursday. The mint's suspension of gold coin sales follows its tight rationing of sales of silver eagle coins, begun in May, when sales to the public were terminated and sales to the mint's 13 authorized dealers were tightly limited. FOR ENTIRE ARTICLE: ALSO:


"As gold hit its lows last evening over $40 off I am told the Chinese entered the cash market to take the layoff in cash gold off the bankrupt hedge funds and negative value sellouts in the paper market. You have seen massive involuntary liquidation last US evening. That type of a situation is common to lows. The bull market in gold will not be broken because fundamentally the problems will not obey and go away."


Treasury International Capital (TIC) Data for June Treasury International Capital (TIC) data for June 2008 are released today and posted on the U.S. Treasury web site ( The next release, which will report on data for July, is scheduled for September 16, 2008. Net foreign purchases of long-term securities were $53.4 billion. Net foreign purchases of long-term U.S. securities were $62.7 billion. Of this, net purchases by private foreign investors were $47.8 billion, and net purchases by foreign official institutions were $14.9 billion. U.S. residents purchased a net $9.2 billion of long-term foreign securities. Net foreign acquisition of long-term securities, taking into account adjustments, is estimated to have been $36.6 billion. Foreign holdings of dollar-denominated short-term U.S. securities, including Treasury bills, and other custody liabilities decreased $2.2 billion. Foreign holdings of Treasury bills increased $6.9 billion. Banks' own net dollar-denominated liabilities to foreign residents increased $16.7 billion. Monthly net TIC flows were positive $51.1 billion. Of this, net foreign private flows were $38.0 billion, and net foreign official flows were $13.1 billion. (GT sez: Monthly requirements are more than $60 we come up short at $51.1B)


Surprisingly light overall volume since 5:20am pdst the day session open.. Nothing dramatic, just regular volume per 10minutes of between 4k the first 10 minutes and then lightening up a 1000 contracts each succeeding 10 minute period. Also, HOURLY VOLUME since 1:00am pdst, when gold turned back up, has been no greater than 5.39K in the 4am hour segment, but jumped to 17 .5 for the 5am segment (a total of the shorter time periods just described above) The point being, no dramatic rush to get into gold at these incredible price levels! At least gold has risen 20 dollars from the low at 7777 (still can't get over that number! It's as if someone is trying to tell their fellow consipirators/manipulators something and having a big laugh over what they have managed to pull off!) Gold is now beginning to pull back...we shall see how far the profit takers will sell it down, where anyone with half a brain should be buying in.


TODAY'S REPORTS: Industrial production Consumer sentiment Quite and interesting trading day yesterday, and certainly overnight, as gold falls in a very erratic fashion, on light volume, until around midnight pdst. Then, while I was asleep, it falls to a very odd number 7777, and has been rallying ever far a 20 dollar rally since 1:30 am pdst... Now, as gold enters New York, a brief sell off begins, but is aborted 5 minutes before the NY day session opening. I should be very busy again trading to protect my long positions much, much higher than here. This all will be history soon, and gold will be much higher than before... So, no griping that your CASH GOLD is now less than you paid for it! You haven't lost anything unless you SELL IT! If you do sell it, you are a dummy!

Thursday, August 14, 2008


"Anyone waiting for the financial industry to return to the glory days of 2006 may have a long wait. As a credit-fueled boom turns into a bubble, it takes more and more lending to produce an additional increment of GDP growth. In the real boom years after WWII, it took about $1.40 worth of credit to produce $1 worth of GDP growth. The ratio rose sharply after the Reagan Revolution...and now stands at about $6 of credit to every extra dollar of GDP. Of course, that is why Wall Street made so much money – it was selling credit. But it’s also why that story is history; that show is over. As the cost of growth – in terms of credit – rises, so does the cost in terms of debt service. Even at 5%, the cost of $6 of credit is 30 cents per year. If it produces $1 of GDP growth, that extra output would need a 30% profit margin to break even. Not very likely."


"Not only do the fundamentals still argue for higher gold prices and a lower dollar but these cause points have become more inviting as the financial situation disintegrates further. Today's inflation report was presented to the media as a basis for an increase of interest rates in the US coming on the heels of a major program to define the oil situation as “Global Destruction of Demand” and “Rate will Decline in EU.” So today’s PR play was for lower energy and higher US interest rates. Currency intervention is now over but the PTT is taking advantage of the weakened commitment now existing after more than a ten cent drop in the Euro value versus the US dollar. When the long side is exhausted, the pros will take advantage and do like today based on nothing much in reality. Not to be redundant but gold is going to $1,200 and $1,650 regardless of the massive spin 24 hours a day, seven days a week, or from soothsayers."


Posted On: Thursday, August 14, 2008, 7:20:00 PM EST More On the Federal Reserve Gold Certificate Ratio Author: Jim Sinclair Why will the effort to call any top in the gold price be a waste of time for the gold-ignorant gurus? Prior to being reduced to zero percent and then removal from the books, there was a direct link between the value of US Treasury gold held (a fixed price of gold then) as a percentage of the growth of the US money supply. As an example, when the cover was deemed to be 25% that meant that as the money supply expanded the value of gold had to be expanded by 25% as well. Because the price of gold was fixed, the gold cover clause, as this device was known, mandated an automatic change in the Federal Reserve Discount rate in order to depress the demand for funds in the US economic system. There is an argument that says as the dollar was becoming a primary reserve currency, and world trade was growing at record rates, the automatic changes in a monetary system were restraining the true wishes of the Administration and Federal Reserve. After the demise of the Bretton Woods Agreement, everything financial moved towards a floating system. The move away from fixed points towards a fully floating financial system was the process of removal of all financial ALARMS. No longer was there a currency parity rate that, when hitting the lower or upper bands, rang an ALARM. The concept of financial crisis no longer existed. The movement of any currency up or down - as the Euro recently did - would have been considered a financial crisis. We have just witnessed multiple central bank interventions that are accepted by the establishment?s international investment community as a dandy deed in the cover up of other serious systemic weaknesses. As a result, upper and lower bands have been considered and implemented. To benefit the plan, the lower limit of $1.49 will not be defended, yet in time the market will. $1.49 is only a point after which no great undertaking of intervention will be applied. Let the apples fall from the tree, if they please, as per today. There is no return to a FIXED anything, but there is a clear indication of a return to the relationship of floating financial alarms, a marriage between the thesis of Bretton Woods and the floating sins of our Financial Fathers. The Revitalized and Modernized Federal Reserve Gold Certificate Ratio will be tied to a broad measure of money supply, M3 or another new definition of liquidity. The gold that the US Treasury has held primarily at the New York Federal Reserve will be valued at market at the time of adoption of this mechanism. Please understand, that regardless of the arguments concerning the number of ounces the Federal reserve holds, since it will never be audited, accept what is said as correct. Now the floating increase or decrease in monetary aggregates will mandate a change in the value of the gold held by the US Treasury. The US Treasury will never have to buy or sell any gold because vehicles will be created that are immediately traded on exchanges that will speculate on the changes in the broad base monetary aggregate in terms of the gold price. That will serve the needs as the aggregates increase. This is in fact a public way to view the aggregate change by changing the value of another asset, which is a means of balancing the balance sheet of the USA as it was at the day of adoption. It is not convertibility. It floats and is not fixed. When the need is greatest it will be seen as an acceptable return to a form of disciplined central banks actions. It will be a reinstatement of an alarm mechanism but with parts that float. The market value of gold on that day will be a pendulum-starting point, not a fixed price. The broad measure of money supply on that day will be 100 on the liquidity index. Assuming the dollar is at .5200, the adoption of this mechanism could mark the low of the US dollar for this chapter of the financial history of the USA. There are other items that will have to fall into place if that is to be the dollar saver from a complete Weimar experience. But this is the major criterion for success. I assume it is January the 14th, 2011 and gold is trading at $1,650 or higher. Then I would assume the price of gold to trade $100 above and below the price of gold on that day according to changes in the liquidity index. If the USA would like to avoid the USD$ from a Weimar experience this is the key ingredient to preventing that. The US dollar is headed in the direction of the Weimar Experience in order to satisfy financial failures of significance. Some smaller entities will be rescued by Federal Money, exploding the US Federal Budget deficit and putting the weight of more newly created dollars on the inherently weak dollar. There is a 70% possibility that since central banks have moved to floating currency parities that the modernized and revitalized Federal Reserve Gold Certificate Ratio will follow under the pressure of future systemic and grave financial circumstances.


Posted On: Thursday, August 14, 2008, 11:35:00 AM EST The Anatomy of Foreign Exchange Intervention Author: Jim Sinclair We have just witnessed the first massive act of intervention coming off the .7199 USDX and $1.5974 Euro. We have covered why this happened and its meaning in terms of the instatement of currency parities, albeit this time on a floating basis. Now you need to understand how intervention works when repeated over time: 1. Currency intervention is like being addicted to a controlled substance. Your first experience at the height of the controlled substance produces mind-altering feelings and emotions. From this point forward you require more and more of the controlled substance to reach anything near the first experience. When you fail to get the fix, the pain and/or downer is unbearable. 2. Each subsequent experience of foreign exchange intervention demands more vocalizing and funds. That being said, you have just seen the most success you will see in the Euro via intervention - and thence gold 3. Eventually it becomes much too expensive to sell a more valuable and appreciating currency in return for fundamentally weak and therefore depreciating dollars. 4. The operation loses capital input because it is the reverse of what central banks in the East wish to be a part of. 5. The operation runs out of capital as one central bank after another uses intervention to covertly unload US treasury instruments into demand. 6. The operation runs out of power as the market senses a wounded strategy. The seven trillion dollar a day turnover in the world dollar market now fades it. That means taking the opposite position to the desired impact of the intervention earlier and earlier in the process. 7. Eventually the operation moves to 75% verbal intervention and 25% capital-driven intervention. 8. As the price of the fade comes in closer, the power of the strategy weakens. The USD troops will move up in price as a secondary line of defense for the ongoing operation. 9. Eventually the strategy fails at that level. This is why you have heard many times that intervention in foreign exchange markets always fails. Intervention in foreign exchange markets never has nor ever will change the trend in any currency. Intervention can only have legs when it floats the temporary parities in the direction of the major market trend. Understand this and you will understand why and how much of an influence the strategy will produce. When the vocal instruments get louder, the reactions become smaller until the strategy at that level of floating parity is checkmated by the world marketplace.




TODAY'S REPORTS: Jobless claims Consumer price index Core CPI This morning's reports should move the market quite well, regardless of the "facts" they report. I am finding myself swamped with things to do and trade for myself as well.. You will find that I put a specific comment in the Title of the Charts I post.. and most of you by now should know that I consider Trendlines, Trendchannels, and Fibonacci the most important tools in the short term trading I do... The markets are now moving so fast and erratically, that it is almost impossible to post a comment that isn't worthless as fast as I post it... Almost the same for the charts... I will probably have to post comments less frequently, and speak more generally, than I have been doing. It's fairly easy to post a chart quickly, which is far more valuable to you than my comments, as "a picture" is worth a thousand words! Gold has moved up well over night adding on to yesterday's gains... Two scenarios are possible.. Gold can keep climbing and/or spike up... Or it can pull back to lock in the current profits made by lower buyers, and is also susceptible to being hit hard by the NY gold managers... The CPI figures will be their excuse, regardless of what is reported, as you have seen so often. The euro is being hit and has to a great degree disengaged from gold in recent trading.. It is basically going sideways after being knocked to the bottom of the range that Sinclair says has been manufactured for its allowable trading...for now! It will be over 1.60 on its way to 2.00 in months to come! Oil showed what it can do on rumor alone yesterday... so it is always a potential influence on gold, being denominated in dollars as it is. Gold is now ON ITS WAY BACK UP TO HIGHER HIGHS by the end of the year!

Wednesday, August 13, 2008


EXCERPT: Culture of Life News--Money Matters here! This sort of 'analysis' (see entire article) is typical of chart watchers who don't understand the business of the floating currency system launched by the mighty USA empire back when Nixon killed the gold peg. The USA had virtually no trade deficit back then but the dollar was artificially high against the DM and yen. Already, a flood of exports from these two rising industrial giants were flooding into the US. Other central banks like France were raiding Fort Knox and the gold reserves there were drawn down by 74%. Since the floating currency began, all trade rivals have sought to create advantages vis a vis the dollar. Their tactics shift as the US whines and complains. From the Bretton Woods II Accords through the Plaza Accords and the Louver Agreements, the US has sought to weaken the dollar and demands 'free trade' where by Fortress Japan and Germany both buy more US goods. After each of these artificial agreements, the status quo is re-started which is for all trade allies to flood the US with exports. Each cycle, the number of nations that figure out how to game this floating currency system increases. Now, the US is besieged by the entire planet. They figured out how to use their FOREX systems to weaken their currencies vis a vis the dollar artificially. They know how to bribe US trade and government officials so they undermine America and boost alien nations. The US Presidents from Reagan to the Bush clan have been in the hands of Asian financiers, openly taking bribes, openly doing business with trade rivals who constitute most of our trade deficit. The Bush clan, and there are many of them, operate in China to an astonishing extent, for example. The recent rise in dollar value was FAKE. It was engineered by a very frightened Europe which is seeing a big recession unfolding due to the euro being too strong. They can't drop interest rates to Japanese levels....YET....but they are now using the other tools to buy and hold dollars. FOR COMPLETE ARTICLE GO TO:


Posted On: Wednesday, August 13, 2008, 9:28:00 PM EST The Anatomy of Foreign Exchange Intervention Author: Jim Sinclair We have just witnessed the first massive act of intervention coming off the .7199 USDX and $1.5974 Euro. We have covered why this happened and its meaning in terms of the instatement of currency parities, albeit this time on a floating basis. (Whaaa?) Now you need to understand how intervention works when repeated over time: 1. Currency intervention is like being addicted to a controlled substance. Your first experience at the height of the controlled substance produces mind-altering feelings and emotions. From this point forward you require more and more of the controlled substance to reach anything near the first experience. When you fail to get the fix, the pain and/or downer is unbearable. 2. Each subsequent experience of foreign exchange intervention demands more vocalizing and funds. That being said, you have just seen the most success you will see in the Euro via intervention - and thence gold 3. Eventually it becomes much too expensive to sell a more valuable and appreciating currency in return for fundamentally weak and therefore depreciating dollars. 4. The operation loses capital input because it is the reverse of what central banks in the East wish to be a part of. 5. The operation runs out of capital as one central bank after another uses intervention to covertly unload US treasury instruments into demand. 6. The operation runs out of power as the market senses a wounded strategy. The seven trillion dollar a day turnover in the world dollar market now fades it. That means taking the opposite position to the desired impact of the intervention earlier and earlier in the process. 7. Eventually the operation moves to 75% verbal intervention and 25% capital-driven intervention. 8. As the price of the fade comes in closer, the power of the strategy weakens. The USD troops will move up in price as a secondary line of defense for the ongoing operation. 9. Eventually the strategy fails at that level. This is why you have heard many times that intervention in foreign exchange markets always fails. Intervention in foreign exchange markets never has nor ever will change the trend in any currency. Intervention can only have legs when it floats the temporary parities in the direction of the major market trend. Understand this and you will understand why and how much of an influence the strategy will produce. When the vocal instruments get louder, the reactions become smaller until the strategy at that level of floating parity is checkmated by the world marketplace.


Posted On: Wednesday, August 13, 2008, 1:12:00 PM EST European Central Bank Action Visible For All to See Author: Jim Sinclair Dear Friends: Welcome back to the Bretton Woods Agreement: Currency Bands Modernized and Revitalized. It is so transparent that you would have to be blind not to see it. Today, Jean-Claude Trichet, the European Central Bank president, returned to his strategy statement that inflation was a more compelling issue for the ECB than the level of economic activity. The majority of the last three generations of currency traders make their market decisions based on anticipated interest rate differentials. The Euro was muscled off the near $1.60 level by more than $10 billion in currency market intervention, along with Trichet's verbal intervention stating that the economic environment might take precedent over inflation. Today as he reverses himself by making inflation the primary concern, more intervention is taking place to make the Euro look weak in the face of a statement that should have the opposite impact. Now you have the Euro "verbal currency band" reinstated at a low of $1.49 and a high of $1.60. Alarms have now been put in place in the Euro that will scream like a siren when violated. The Euro trading above $1.60 will clearly show that Central Bank power has been overcome by market action. The U.S. and ECB Central Banks will change the bands to $1.55 - $1.65 but that will fall quickly as my following comments outline: Gold will recognize that the lower band is the floor price for the Euro at which time market reactions for gold will become less violent and higher highs will be achieved. A little less violent trading range for gold would certainly make life easier for everyone - especially those companies that produce, explore and develop mineral deposits. I have informed you many times that there is going to be a revitalized and modernized reinstatement of the Federal Reserve Gold Certificate Ratio. This upcoming monetary tool has been reviewed many times on Go to search to review. The Revitalized and Modernized Federal Reserve Gold Certificate Ratio will be tied to a reintroduction of M3. It will not be tied as in the pre-Bretton Woods Agreement. The treasury will have nothing whatsoever to do as the open market will do it for them. Now I can state with total conviction that when the Federal Reserve Gold Certificate Ratio is reintroduced gold will trade $100 above and below this index gold price for many years to come. I anticipate this at gold $1,650. Therefore, fear of a 1980 gold experience on the downside is no longer valid. I have told you that those you identify as gold's enemies are indeed gold’s best friends. As always, those close to power are going to make more on gold that the disbelievers in the gold community ever will. With the introduction of the revitalized Federal Reserve Gold Certificate Ratio and currency bands, gold will be supported by a peg and the Euro will not. When this unfolds in front of all the meatheads in the investment world, it will be seen that gold is a better investment than any currency. Now you see the plan unfolding exactly as it has been outlined on for more than seven years. Respectfully, Jim



10:12AM PDST

Things have just been moving too fast to post comments just charts... You can get enough info from my titles and the trendlines and fibs that I put on the charts to know where gold should be going. I expect gold to move higher the rest of the day. Today's trading has pretty much confirmed that we have seen the bottom and will now be moving up... more later as time allows... I have to trade too!


Dollar has moved up further to .7659 while Dow bottomed near 11500 and has formed and almost perfect head and shoulders pattern on a 5 minute chart.. Target: DOWN! Euro moving down Gold selling off the last rally, will repeat and rinse!


Dow opens, drops like a rock and dollar gets a goose up to .76485 and oil starts dropping Seems fishy to me. Gold sold off its morning rally, bounced a bit, but no continuing strength, so it's beginning to sell off some more. The low at 809 seems to be holding so far, even though the real low is at 80460. This morning support is in the 816 area.. There is no coherent pattern yet for the Trend Reversal UP that we need to see however, as always, I think we won't see gold moving lower than the 805 area, and will continue to see more sideways trading between the bold blue chart lines, which is beautiful for traders as the range is significant.


gold retraced up to the 75% point at 82910 paused to consolidate but didn't show enough momentum up, so now it is pulling back to the lower congestion area around 82450, but could go down further to the 75% retrace point at 82250... gold needs to move higher and take out 83250 firmly to start the new UP TREND in gold.


Still haven't seen the reports results on MW, but gold sold off on the open down to 82120, quickly bounced, then suddenly sold off again lower to 82050, which is right on the morning's up trend line (light white line) and quickly rallied from there on moderate to strong volume. Euro also rallied some Oil is moving up slightly in the 113s Dow is moving down Bonds are rallying in the 116s Dollar just moved down to .7636 Gold just rallied to match the previous high at 82640 and immediately sold off... Where it goes from here is unknown, but it seems that it will go sideways between the bold blue lines on my chart for awhile until it can build a base sufficient to convince those on the sidelines to move back in... But when they finally do...hang on!


After a quick review of the markets... Dollar is at .7645 after rallying from .7602 up to .7663... quite a range and reeks of PPT-Central Bank intervention. Euro is simply still moving down without any significant rally, and is dis-engaged from gold at present if you look at their charts side by side. Dow, even with all its recent convulsions, is DOWN and will STAY DOWN... unless hyper inflation eventually makes it rise to the heavens as investors use their worthless paper dollars to buy stocks, which will have the same value as the dollars they just traded it for it. Bonds are in the 116s Oil is still staying near its recent lows...presently at 113.35 This morning reports will move the market, simply because the market makers WANT to move it to trade it... How much lower they can suppress gold is from here is questionable, even with the manipulation of the dollar and other markets... The World's troubles scream for physical ownership of gold right now! Gold will react to the upside, when the World's peoples come to the same conclusion due to some FINAL precipitating event, unknown at this time... Something BIGGER than the Russia/Georgia event (initiated by the U.S.!) George W. Bush will not leave office quietly! Have you ever seen him not find one more area of the World in which to cause death and destruction?


TODAY'S REPORTS: Retail sales Retail sales ex-autos Import prices Inventories After a brief sell off in the afternoon yesterday, gold moved up gradually all the way to 83250 just after midnight pdst, pulled back seven dollars, retested the high again, and has now retraced the entire up move 61.8% and has just bounced off 81980 on light volume. more shortly after my market review...

Tuesday, August 12, 2008


From Stupid to Moronic to Evil By Paul Craig Roberts “Although it is not true that all conservatives are stupid people, it is true that most stupid people are conservative.” John Stuart Mill 11/08/08 "ICH" --- - Many years ago, during the 1970s if memory serves, neoconservative Irving Kristol, echoing John Stuart Mill, called his conservative party, the Republican Party, “the stupid party.” Kristol was referring to the Republican’s inability to compete on the policy front. Jack Kemp and Ronald Reagan led the Republicans out of the wilderness, but now Republicans have reverted to the stupid party, or more precisely the moronic party. FOR ENTIRE ARTICLE:


Bush's War in Georgia Will it be the Flyswatter or the Blunderbuss? By Mike Whitney “I saw bodies lying on the streets, around ruined buildings and in cars. It’s impossible to count them now. There's hardly a single building left undamaged.” Lyudmila Ostayeva, resident of Tskhinvali, South Ossetia 11/08/08 "ICH" -- - Washington's bloody fingerprints are all over the invasion of South Ossetia. Georgia President Mikhail Saakashvili would never dream of launching a massive military attack unless he got explicit orders from his bosses at 1600 Pennsylvania Ave. After all, Saakashvili owes his entire political career to American power-brokers and US intelligence agencies. If he disobeyed them, he'd be gone in a fortnight. Besides an operation like this takes months of planning and logistical support; especially if it's perfectly timed to coincide with the beginning of the Olympic games. (another petty neocon touch) That means Pentagon planners must have been working hand in hand with Georgian generals for months in advance. Nothing was left to chance. FOR ENTIRE ARTICLE:


YOU DAMN WELL BETTER READ THIS ONE FOLKS! In addition to the World's Most Famous Lies, like: "the check's in the mail!" Here are some more that the U.S. Guv'mint has uttered recently : (courtesy of JSMINESET.COM via Is the U.S. Banking System Safe? "Treasury Secretary Henry Paulson delivered an upbeat assessment of the economy, saying growth was healthy and the housing market was nearing a turnaround. 'All the signs I look at' show 'the housing market is at or near the bottom,' Paulson said in a speech to a business group in New York. The U.S. economy is 'very healthy' and 'robust,' Paulson said. (CBS Marketwatch 4/20/07) “At this juncture, the impact on the broader economy and financial markets of the problems in the subprime market seems likely to be contained.” (Ben Bernanke during Congressional Testimony 3/2007) "We will follow developments in the subprime market closely. However, fundamental factors—including solid growth in incomes and relatively low mortgage rates—should ultimately support the demand for housing, and at this point, the troubles in the subprime sector seem unlikely to seriously spill over to the broader economy or the financial system." (Ben Bernanke 6/5/07) "It is not the responsibility of the Federal Reserve—nor would it be appropriate—to protect lenders and investors from the consequences of their financial decisions. But developments in financial markets can have broad economic effects felt by many outside the markets, and the Federal Reserve must take those effects into account when determining policy." (Ben Bernanke 10/15/07) “We’ve got strong financial institutions…Our markets are the envy of the world. They’re resilient, they’re…innovative, they’re flexible. I think we move very quickly to address situations in this country, and, as I said, our financial institutions are strong.” (Henry Paulson 3/16/08) Deception – Keeping the Ponzi Scheme Going After reading the above quotes, it should be clear to you that these gentlemen do not have a clue. Our economy and banking system is so complex and intertwined that no one knows where the next shoe will drop. Politicians and government bureaucrats are lying to the public when they say that everything is alright. They do not know. Therefore, it is in our best interest to cut through all the crap and examine the facts with a skeptical eye. Last week, bank stocks, which had been falling faster than President Bush’s approval rating, soared higher based on earnings reports that were horrific, but not catastrophic. Again, the talking heads, like Larry Kudlow, were calling a bottom in the financial crisis. The bank with the largest increase in share price was Wells Fargo. Their earnings exceeded analyst expectations and the stock went up 22% in one day. Wells Fargo (WFC) has $84 billion of home equity loans, with half of those in California and Florida. Coincidently, Wells Fargo decided to extend its charge-off policy in the 2nd quarter from 120 days to 180 days, in an effort to give troubled borrowers more time to reach a loan workout. A skeptical person might think that they did not change this policy out of the goodness of their hearts. Maybe, just maybe, they changed this policy to reduce their write-offs for the 2nd quarter, to beat analyst expectations. There are many stories of people who are still living in houses, twelve months after making their last mortgage payment. Their banks have not started foreclosure proceedings. FOR THE REST, USE THE URL ABOVE:


Posted On: Tuesday, August 12, 2008, 4:01:00 PM EST What You Need to Know Author: Jim Sinclair Dear Friends, The following missive encapsulates everything you need to know. Please pass this along wherever there is interest. There are indeed a lot of things happening in the world - and some have terrible consequences. The politicos are scheming intensely. I played a business game in university involving three teams running three companies who were all competing to make the most profits. The economic situation today mimics that game and its eventual outcome. If one team made a mistake, invariably the other two teams turned against it with blood in their eyes. We expected the other team to turn on the weaker player and planned accordingly. In my humble opinion the following factors are particularly relevant to today's economic situation: The fiat money system around the world is a house of cards. There is no entity I know of that can borrow forever without paying back someday. Disregarding Europe, (which seems to be suffering worse that the US at the moment if you believe all the propaganda out there), I doubt the amount borrowed by the US Feds - never mind the states and cities, the corporates and individuals, will ever be paid back - and we are talking trillions. (Remember that the Gross National Product of the USA is between 10 and 15 Trillion). Mother Nature has her own ways of extracting payment. When Central bankers around the world collude to save something - be it the financial system, the dollar or whatever - they never commit to such a process unless there is a clear and present danger. That danger had to be recognized by all parties for them to take any action, whatever the outcome. When the problems with our financial system became apparent, countries started ?diversifying? out of the US$. (Read "dumping" it as quickly as possible without starting a panic.) Aside from the last few days, which I attribute largely to ?open market operations? (read manipulation) and the fact that markets never go in a straight line, the US$ has been slipping badly against all currencies, and the effort to ?diversify? has spread to nearly every country. The dollar is a forty pound weakling and the whole world knows it. The dollar underpinned nearly every currency in the world (including the Euro) and still does to a large extent despite the ?diversification.? The clear and present danger affects all fiat currencies around the world. Governments have learned to distract others - particularly their voters - from an issue by setting up a straw dummy and knocking it down. In the case where the main thrust of some legislation would be roundly condemned, they add one positively draconian measure as a dummy and give it up to achieve all their other goals. What bigger distraction could there be than WWIII, nuclear/biological/EMP style? I think the US set out to distract their voters and the world from the financial problems by saber rattling over Iran. War is not only hell, it is expensive. I think the US made a mistake. Russia recognized the ploy and has taken advantage of it. In 1989, when the USSR went bankrupt over the Cold War, the US was in bad financial shape as well. No war in history has ever been settled until one or both of the protagonists went broke. Since that time, Putin has been busy, particularly in the oil patch, strengthening Russia?s financial position. (I suspect he now has FAR more reserves financially that the US which currently amounts to only ?the full faith? of the US and loans that are so large as to frighten most of the holders of that paper.) The financial situation in the US continues to deteriorate. Parties around the world are less likely to lend their winnings to the US if they do not expect to get paid back, both in principle AND interest. It may be argued that the US has a superior military to Russia. I don?t know. What I do know is that the care and feeding of that military costs astronomical amounts. Will the US have to borrow from Russia in order to challenge them militarily as they currently do with China in order to trade? And then there is Afghanistan and Pakistan, two other quagmires. And who knows what China, with vast financial reserves, is thinking? The US was busy steaming towards Iran and Georgia - the latter a US-backed country which attacked South Ossetia, a Russian-backed region. Within 24 hours, Russia had thousands of men and massive amounts of equipment in Ossetia. You don?t move that number of men and equipment in 24 hours unless you are fully prepared to do so, and even then it is difficult. It took many weeks for the US to move that amount of assets during Desert Storm. Russia was prepared, for whatever reason, for that attack. Ooops, suddenly the US is being attacked on another somewhat unprepared flank. The US had prepared for a great show of distraction, and could it be that Russia has other plans? Putin is not god but he is no dumbbell. The US is between a rock and a hard place. They have wars on umpteen fronts and are trying to save their financial system which they need to fight even one war. Despite all the happy news in the markets of the last few days, the financial malaise is growing and not bottoming. Not only that, but world supplies of oil are tight, and the US imports at least two thirds of its oil. To maintain its world status and/or military, the US needs Iraq, Iran, AND Georgia. I understand Mexico, a big supplier of oil, has just become a net importer. Canada, the largest oil supplier to the US, has conventional reserves that are dropping alarmingly. And despite its vast oil sands, Canada can't expand oil production from this source very quickly. (Oil sands extraction needs fresh water, and they are almost at the limit now). Moreover, if the West abandons Georgia, not only will they lose that oil source, their weakness will be apparent for all to see. And surely the other players in this game will turn on them. It is Mother Nature' way.



11:40AM PDST

There really isn't much else to say about today's gold trading that isn't summarized excellently by Dan Norcini's chart comments which he posts right after the day session close each day on an 8 to 12 hour chart GO TO JSMINESET.COM and read EVERYTHING...and BELIEVE! GT is still tired, so I'm taking my nap now and will be back this afternoon with the important articles that have been accumulating during this transition away from MarketWatch's Censorship Community to this much freer Blog Format... I haven't seen an asterisk yet that I didn't put there myself.

10:02 AM PDST

Gold moves lower in the half hour before the day session close approaching the bottom line of the down flag...reaching 81330... below the 75% retrace point at 81490. Because gold didn't manage to move up further, the profit takers moved in to keep their loot. Gold is now moving up from this sell off on very strong volume of more than 1,000 contracts/minute. This is perfectly normal trading behavior.


Gold has pulled back about 61.6% of this morning's move up to 83360 and is now moving lower in the down flag allowing profit takers to take their money home, and allow new buyers to move in to gold. This is all normal trading behavior and is moving gradually instead of violently, which is good. Trading volumes HOURLY have been in the 20,000 range since 5AM PDST both up and down This is fairly LARGE VOLUME compared to past history, but is going to become AVERAGE VOLUME from now on. Dollar moved down to .7614 but has moved back up to .7644 no rational reasons for its movement at all except for PPT and Central Bank intervention Euro is moving down again Oil has dipped into the 112s, back up to the 116s, and back down to the 112s at present It should be roaring way up given the Russia/Georgia situation and its oil pipline... but of course, nothing makes sense any more. Dow has been moving down since the open Bonds in the 116s


Gold is pulling back because it lost its momentum upwards, even though a tremendous amount of buyers appear to have jumped in on the opening up to the top at 82840... Gold has now formed its usual down flag and has dropped below the bottom line of the up trend channel, but is still within the down flag where it may consolidate for a further run up.. It has retraced down to the first 75% point at 81970 (there are more below) If it doesn't start moving up soon, it could flop back down to the earlier lows, or it could just keep trading sideways building a base. Dollar has been up to .7678, but is down to .7626 presently. Euro is up from its low at 1.4785 Oil is coming back up from its low in the 112s, now in the 114s Dow is down after the opening and breaking down through 11700 level Bonds in the 116s and have been moving up in cycles from the 115s


Someone please go to the new comments blog at TALKBACKTOGOLDTRADER.BLOGSPOT.COM and give it a test post or comment on how you feel it will work for you. You all will be able to see a series of the last 500 days of POSTS (what I will which you will post your comments) I will simply create a POST AREA for each day, labeled as such, where each day's comments by you folks will be congregated.

5:40 AM PDST

Gold has moved up on very strong volume in the 5am pdst hour over 18,000 contracts at this minute and growing as gold is taking out two previous tops. gold topping right now at 83360 before pulling back. 5:45am pdst volume has moved up to 21,500 contracts so far very little of it is down volume. Expect a profit taking pullback soon!


Running behind this morning... NEW BLOG FOR YOU TO POST YOUR COMMENTS ON: TALKBACKTOGOLDTRADER.BLOGSPOT.COM TODAY'S REPORTS: Retail chain index Trade balance 5:30AM PDST (this is the one that will be distorted to the max!) Gold made new lows overnight but has managed to struggle up from 80860 to 82850 at present... It tested the low twice many hours apart Now to watch and see what happens... more shortly as I review the markets.



Monday, August 11, 2008


"The dollar bull's rational (an oxymoron if there ever was one) is as follows: 1. The thesis held by the dollar bulls is that the EU's economy will decline. 2. At the same time, the economy of the USA will improve, the OTC derivative markdowns are behind us and the credit lock-up will ease. 3. Because of this, the EU cannot raise interest rates but rather has to cut rates. 4. Because of this, the USA - with its improving economy and credit markets - will be forced to increase interest rates. How about a race between the EU and USA to see whose economy craps out the most? My money is on the major manufacturer of OTC Derivatives being the first and fastest into the tank. That is to say the USA wins the race to the bottom of the ash can and just hangs out there. The dollar falls after this major operation and trades to .72, thence to .62 and thence to .52. Gold trades to $1,200 and $1,650."


My unexpected long "nap" has cut into my working time. I may just get up extra early and created the blogs anyway.. I operate "in the moment" anyway!


Pushed through all the stuff to do today... Closed my eyes briefly "just to rest them" sometime around (?)... woke up at 9pm pdst... Cats are pissed off...passed dinner time ( 5:30am/pm)... They wont' talk to me now! Please be sure to read Sinclair and look at Dan Norcini's charts... May not get to my two new blogs tonight, but by tomorrow for sure! What an opportunity...maybe the last one...before the end of the World as we have known it! Buy all you can carry!


It took awhile, but I'm finally back online... More coming as I review the markets... Still haven't had my nap, so I ought to be falling down in a few minutes... GT

10:45AM PDST

We've just seen the sell off before, into, and after the day session close. Not a strong bounce off the new low though... While volume is moderate to strong at times, it's not consistent enough to make me think that buyers are going to pile in here. Euro is down to 1.4873 Oil at 113.10 Dow is screaming at 11834, mostly on hot air and bullshit... Boy are those buyers going to get killed soon! Bonds in the 115s, down from the 116s earlier Dollar has been up to .7655 top, but is now down to .76455 on my delayed charts. Quite a day...and now for an equally exciting afternoon and overnight to see what Asia does... You can be sure their stocks will probably soar... But what will the East do about a bargain price on gold? They're not stupid folks! They understand gold WAY BETTER THAN AMERICANS DO!


Dollar goosed up to .7640 Euro dropped to 1.4883 but rallying a bit to 1.4894 Dow up at 11800s Bonds in the 115s Oil in the slipping back into the 112s from the 113s This is the eye of the hurricane where everything is still, but the violence of the down side is now going to be replaced by the violence of the UPSIDE!


REMEMBER THIS MOMENT FOLKS! THIS IS WHEN YOU SHOULD BE THE MOST CONFIDENT AND BE ABLE TO JUMP IN WITH BOTH FEET AND BUY ALL THE PMs YOU CAN POSSIBLY GET...FOR CASH! Once you turn your head around and turn fear into courage, is when you become a good trader... I know what I'm talking about, because I've done it...! Watch out here for the final one or two dips down to, or even just below, the present low at 825. This is where most people freak out! You won't get the bottom price, but you sure can get a sweet one if you just wait for that final sell off that almost always comes just when they have everyone in at this level... Then the Pros sell it off, scare the SHIT out of the people who just bought in... get them to panic sell, scoop up their longs and start covering their shorts... and take home all the money! Happens all the time! Keep your heads together and REMEMBER THE FUNDAMENTALS! GOLD IS GOING BACK UP EVEN HIGHER THAN BEFORE!


Gold is just cascading down in both panic selling, brought on by over margined traders and the black boxes causing much of this selling. This will turn back up, and when it does, it will go up about as fast as it's coming down now... BUT... A good deal of the up rallies will be sold immediately by those who are just trying to keep their losses less than they were a few minutes before... This is the problem with lose as fast as you win! This is NO PROBLEM FOR CASH GOLD BUYERS! WHO SHOULD BE PAWNING THEIR GRANDMOTHER'S DENTURES RIGHT NOW TO BUY ALL THE GOLD YOU CAN GET! CALL KATHY LUCATERO AT MONEX IMMEDIATELY AND BUY SOME GOLD/SILVER NOW!


Posted On: Monday, August 11, 2008, 11:37:00 AM EST How Do You Explain Last Week's Gold and Euro Action? Author: Jim Sinclair Dear Friends: What definitions and explanations can be derived from the gold and Euro action last week? Here they are: 1. The intervention without any doubt has established that gold is a currency. Because the Euro will trade at $2 or more before this drama has finally ended, gold is guaranteed to follow - probably in multiples of the Euro?s action. 2. In hindsight, intervention started when the Euro was at $1.5975. This reveals the point above which no intervention can have any appreciable impact. That level is $1.6025 three times for 24 hours in a row. 3. Paulson?s desire not to remain Secretary of the Treasury says that any plan currently in place will play out in 161 days at the most. That does not say that current markets have a 161 day life but rather that everything between now and day 161 is short term, camouflage, spin and inherently weak from a market perspective. Paulson's decision not to remain in this most prestigious financial position speaks to the degree of danger that the psychologist-packed Plunge Protection Team (PPT) has worked so diligently to keep mass perception from being focused upon. Summary: Everything remains the same but the fear factor has increased. What's happening in the stock market at the moment is no more than another bear market rally in which the purchase of index puts on the Rhino (when the market appreciation resembles a Rhino horn) makes sense. Gold will rise to $1,200 possibly 90 days later than anticipated. Gold will trade at $1,650 or more before the second week of January 2011. The US dollar will trade at .62 USDX and after great efforts to stop the decline trade at .52 USDX. Black Boxes are primarily momentum driven so keep an eye on that fact in terms of the US dollar versus the Euro. Respectfully, Jim


All lower lines of current trend channels are being violated. The 8am to 9am volume is 37,500 contracts DOWN! This is the self-perpetuating selling that black boxes create as they chase momentum, and eventually create the down momentum themselves... They usually get wiped out on the turn back up... If any of you think this is not an EXCEPTIONAL BUYING OPPORTUNITY... I no longer know what to tell you... Grab some CASH GOLD COINS IMMEDIATELY... CALL KATHY LUCATERO AT MONEX! OR ANYONE YOU HAVE DEALT WITH HONESTLY AND TAKE IMMEDIATE POSSESSION OF THE COINS! There may be problems getting coins quickly once this gold price turns around, because the Big Boys are going to scoop up everything in the World in order to CONTROL/OWN ALL THE GOLD IN THE WORLD where possible! This is part of the GRAND SCHEME! And part of the Domination of the World Plan by the most powerful people in the World!


I wore myself out yesterday at the Air Show and riding the Harley through the come home traffic. And gold is doing nothing worth watching right now... So I am going to get some needed sleep so I can do more reading tonight. I am going to start TWO NEW BLOGS! ONE FOR MY RECOMMENDED READINGS OF ARTICLES FOR YOU ALL TO DO. ONE FOR YOUR COMMENTS SO YOU CAN ALL POST ON THE MAIN PAGE LIKE WE USED TO DO OVER AT "NAZI-WATCH"! As you can tell, those of you who have tried to follow along on this blog format... Reading articles on a blog is difficult, due to formatting, etc. That and having to scroll through my daily gold comments to find articles is not pleasant, and is annoying, at least it is to me. On my Recommended Articles Blog, I will post only a brief EXCERPT from the article with its URL, so you can read it in its Original Form with all its associated link, etc. On the YOUR COMMENTS will be able to do what I do on my blogs.. You will ALL BE AUTHORS! and be able to post your own Titles and comments in the same form as you see on this blog.... I will created those TWO NEW BLOGS tonight! So check back in later! Until then, stop watching gold and go out in the sunshine, as summer will wane soon and you will be putting your warm clothes back on! NAP TIME FOR GT...zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz


Gold has now formed a very short term UP FLAG off this recent low. up flags resolve DOWN... however, this little up flag is within a larger Down Flag that resolves UP! The volume controls everything right now... NO VOLUME...NO TREND! However, again...if gold is slipping down more and more, then the low volume accumulates and defines a DOWN TREND! Until there is a substantial volume to the upside that continues for, at least, two see saw legs up, and preferrably three or more... I wouldn't call a bottom in gold... Too many times I have seen this scenario and gotten wiped out believing that gold just could not go any lower! AND I DID! AND THEN DID IT SOME MORE! So just cool your jets and go into waiting mode for a juicy buy in point... OR... If you have the funds, just keep buying more and more CASH GOLD COINS at intervals on the way to the bottom, and "average the cost" as the price of having gotten better and better prices overall... This is how the Big Boy do it...and that's why they're the Big Boys!


Gold has continued to weaken, and can easily go lower as selling breeds more selling, especially with the black box trader trading momentum, which is down. All moves are on LOW VOLUME...This can cause very erratic moves! Any rally is only temporary, and can, or will, be sold almost immediately after and rally of sufficient range that would be considered a decent profit. gold is moving higher at this moment, and approaching the first 75% point at 86260. I don't see any reason for a large move up today.


gold retraced to just shy of the 75% point at 86450 on light volume and seemed to do it very cautiously.. It also broke just above the very short term down trendline (white line) and has just the minute pulled down sharply below the new short term up line along the recent bottoms of the recent rally to retrace a pinch more tha 75% of the last leg up from 8618.. The lowest 75% point is at 86080 using 85970 (today's low) to compute.. Trying to make sense out of the movement in the other markets is maddening, because just as you think you see a pattern, something wild and crazy happens and obliterates all reason..which is, of course, the point of manipulation... To keep traders off balance! Euro is moving up carefully... Dow is slipping on the open Bonds move up to the 116s (for the umpteenth time/1) Oil in the 115s and has hit 114s earlier. Dollar is at .75985 after moving just above .7610 and then slipping back Gold is now retracing its recent rally to 86420 No pattern or volume of significance to impress me... so I will wait for gold to get hit some more HARD... or it will just creep back up on irregular volume.. Then, for the rest of the week, various reports will move it...


Nothing is looking good for gold at the moment... The dollar has been "re-goosed" back up to .7610, with the recent high at .7630.. The Euro is fading again. Oil is down in the 115s Dow is strong at 11692 before the pit opening in 20 minutes. Bonds are in the 116s, with no particular rhyme or reason to how they will trade. Gold is sinking just below the 75% retrace point (see charts) and showing no big volume on any short live rally. This could be the "beyond reason" gold dip that has preceded the last three or more years' big second half of the year run up to old highs, or even beyond the old high... Just prepare yourself for what you will begin to think is the end, and.... just when you want to give up and sell your gold... is exactly when IT WILL GO BACK UP...AND BIG TIME....! Leaving you even crazier, because now you don't know if you should buy back in or wait for a pull back (that never comes) and the higher it goes, the less you are willing to buy in for full of the pull back (especially traders on margin !) Just know YOU CAN'T CALL BOTTOMS! But you can buy NEAR bottoms!


On the opening, gold took its usual NY dip, rallied but faded and is now trying to find direction. Dollar is still up near .7600 but has started to pull back, as there is no reason politically for the PPT or the central banks to push it higher today...and.... they don't spend their funds any sooner than they have to... of course their "funds" are just the printing presses. Euro really took a beating last week, mostly due to the ECB (Eurpean Central Bank) NOT raising rates...that guaranteed that European inflation will continue. Oil has sunk to the 1oo_teens (116s presently)... Nothing else really matters much. Gold just doesn't look strong to me today, from volume to trading pattern. It could easily get walloped again, but if it does, we should see some interesting rallies and trading opportunities in the very short term... AND I MEAN VERY SHORT TERM...LIKE MINUTES!


Well folks, I'm sunburned, sore and tired from watching airplanes burn fuel all day yesterday at Fairchild Air Base's SKYFEST Air Show with the Blue Angels. Too many reflections to list here, but we sure do have a lot of children wearing camo and carrying side arms and M16s in the attack position walking around public crowds who were invited to see how our tax dollars are spent. The pro-war "we're the most powerful" propaganda by the show announcers, was so thick you would have thought we were still in WW2. Now to business... NO REPORTS TODAY! Gold has been rising since Sunday afternoon, with two good, yet normal, pull backs one of which it is now rallying up from at this hour. Gold is still in an intermediate DOWN TREND, which MAY have been stopped on Friday but that isn't verified until we have several more up legs to confirm it.. At this point, we are merely "speculating" that we hit bottom, and as we have all recently discovered, the FUNDAMENTAL, while still working below the surface, are being blocked by Guv'mint MANIPULATION. more shortly...

Sunday, August 10, 2008


THIS ONE IS FOR CSPAN... (I just got in, am very tired, and haven't even read this yet...GT) "Plunge Protection Team behind USDX big one day uptick, real numbers are bad for unemployment, inflation, credit, corporate earnings, and fiat currencies, but markets going up in the face of all this bad news, manipulations to return with a vengeance, European Union stability doubtful, stock firms back Obama, many states face massive budget shortfalls, real estate could fall for five more years" FOR ENTIRE ARTICLE: