David Schectman

Quotes of the Day

From a trading perspective, gold seems to have bottomed on 7 November at $1,130/toz and reached a higher low of $1,142/toz on 1 December. Consequently, as long as gold does not fail to trade above that level, I am bullish and I am ready to build long positions as the risk/reward profile is greatly skewed in my favor and Greece's political crisis may be the catalyst for higher gold prices. However, if gold fails to trade below these levels, I would turn bearish again and I would expect a final low in 2015.

- Boris Mikanikrezai, December 24, 2014

- Booming GDP - Strongest Growth in More than a Decade Is Nonsense 

- Magnitude of GDP Revisions Suggests Unstable Data and Unusual Internal-Reporting Issues at Bureau of Economic Analysis 

- Basic Durable Goods Orders Slowed Sharply in Third-Quarter 2014, On Track for Fourth-Quarter Contraction 

- Home Sales Also Showed Patterns of Stagnation and Renewed Downturn

"No. 684: GDP Revision, November Durable Goods, New- and Existing-Home Sales" 

-John Williams, Shadowstats.com, December 23, 2014

Back in the late 1970's the Hunt Brothers accumulated close to 100 million oz of physical silver (and more in futures contracts) and were found to have manipulated the price of silver higher as a result of that accumulation. What makes the much larger accumulation of physical silver by JPMorgan today different is that it is the perfect crime.  

The Hunts were outsiders; JPMorgan is the ultimate insider. The Hunts ran afoul of the regulators; JPMorgan owns the regulators. The Hunts' purchases were widely known; as far as I know, I'm the only one pointing to JPMorgan accumulating massive amounts of physical silver. The Hunts drove prices higher as they accumulated silver; JPMorgan, by virtue of its price control on the COMEX, has been able to accumulate silver on sharply declining prices. Talk about a stacked deck. 

Given that JPMorgan has such control over the U.S. regulators and is able to operate in near total secrecy in matters related to physical silver, it's hard for me to imagine what could foil their perfect silver crime. All that's missing is JPM selling out at extremely high silver prices. And considering that big banks, in essence, don't have to report anything they don't want to publicly report, I would be surprised if JPMorgan would even have to pay taxes if they made the many billions of dollars they seemed destined to make on silver to the upside.

- Silver analyst Ted Butler, Butler Research, December 20, 2014

Today's Featured Articles

Jim Sinclair (2015 Will Be A Year Of Surprise, Panic, Desperation & Radical Change) (Greg Hunter interviews Bill Holter) (A wonderful skit on bail-in by Max Keiser)

Ed Steer (Gold and silver jumped back up to their 50-day moving averages on Friday)

Zero Hedge (Game Over Japan: Real Wages Crash Most In 21st Century, Savings Rate Turns Negative) (China To Launch Yuan Swap Trading With Russian Rubles On Monday) (Did The Saudis And The US Collude In Dropping Oil Prices?) (SF Fed Warns US Equity Valuations Will Be Cut In Half In Next Decade) (The Fed Is Heading For Another Catastrophe... Central Banking Has Lost Its Way" Stephen Roach Warns) (Could An Energy Bust Trigger QE4, Peter Schiff Asks) (Here Is The Reason For The "Surge" In Q3 GDP)

Jurgen Todenhofer (Embedded with IS group: West 'underestimates the danger')

Dr. Denis MacEoin (The Destruction of the Middle East)

Sincerely, 

Bill Holter

Fact or Fiction?

December 29, 2014

This past year was jam packed with news of all sorts.  Some was surprising, some of it was expected, while other news seemed to either be another dot to connect or an outlier dot to be connected later.  We even got news from time to time which even in today's world could be considered bizarre or surreal.  Suffice it to say, were we receiving the current news of today just 15 years back, the financial and social worlds would have been in outright panic.  Not so today, the sheep are sound asleep even while a few well intending herders are sounding the alarm.  The populace in general have become dumbed down, beaten down and barely able to read past whatever headline it happens to be for the day.  Let's call the condition "comfortably numb"...

I promised to write a "fictional" account of what my thoughts were "the day after" the financial lights go out.  This effort could easily be expanded into a full book because the ramifications of the coming credit meltdown are so far reaching.  The following is my opinion and as such, if you don't agree with some of the possibilities I will provide, then please just smile, grin and bear it or just stop reading.  Here goes...

For years Jack and Jill America had gone through the daily life of what they believed was the American dream.  They've been married 25 years and have their 2.3 children.  Life has been getting tougher though, Jack and Jill both work but neither has had a substantive raise in nearly 10 years and their firstborn is now 3 years into college with the younger one getting ready for next fall.  They have accumulated some assets over the years but will have to refi their home's equity to complete paying for college.  They've done everything they were told to do by the mainstream.  They've contributed to their 401K's at work and even added to personal IRA's and even 529 plans to help pay for college.  Jack and Jill have so far "climbed the hill" of life without any major setbacks, this is about to change as will their entire life!

Going into a long weekend, Jack and Jill have a conversation over dinner.  They talk about the recent headlines they've been reading and the topic turns to the economy and markets.  The Dow just five days ago hit an all-time high and the employment news earlier in the morning was really good!  The problem is, the employment news said the housing industry was doing terrific, particularly in their region.  Jill works in the mortgage market and Jack works for a bank so they both know this news doesn't really add up, the discussion morphs into "are they really telling us the truth?"

Then, something starts to happen at the front of the restaurant.  It looks like four or five couples are all arguing with the owner and the discussion is becoming heated.  You see, their credit cards are not working, none of them!  One gentleman slips out to cross the street and get cash from the ATM to pay his bill ...but he came back empty handed.  The "tone" begins to change once another customer who went to a different ATM machine returns with the news his card was also denied.  The owner decides to call the police because it looks like he is going to be stiffed on most all of the tables since he generally is paid by credit or debit card 85-90% of the time.  The police inform him this is happening everywhere in the city, at gas stations, Walmart, restaurants, everywhere!  So, Jack leaves his business card and promises to come back on Monday to pay, a nice gesture but one he had no idea was pointless!

They spend the weekend watching the news feverishly because they found out it was not "just" their city having these problems ...it was all across the nation.  They feel some relief on Saturday morning as the "news" tells them a coordinated hack attack has taken down the clearing system for banks and is only temporary...but their warm fuzzy feeling turns to near fear when they go online to the internet.  It turns out, the banks are being closed indefinitely and something about China and gold ...and dollars being refused by foreigners.  Jack doesn't get it nor does Jill, how can this be?  What do you mean the banks are closed and dollars not being accepted?  Dollars are used all over the world ...and what is Jack supposed to do Monday morning if his bank is closed?  Will they still pay him his salary?

Monday morning comes and Jack goes to work only to find a sign in the front door "Bank closed indefinitely, sorry for the inconvenience" and a sign on the employee entrance with a phone number to call.  He calls and gets a recording, "due to circumstances out of our control, you will not be required to attend work until further notice".  A cold chill washes down his back and he calls Jill.  She is already on her way home because her mortgage company is also closed, what are they going to do they wonder?  The first thought in both their minds is "food," what are we going to do for food?  When they meet back at the house, Jack pulls out $300 from a drawer that he tucked away after coming back from vacation last month.  On their way to the store, they see huge lines as they pass gas stations.  They both wonder why there are lines since credit cards aren't working but they soon find out ...the grocery store is mobbed and the shelves are almost bare.  All of the canned goods are gone as are the basic staples like rice, pasta and beans.  There are a few vegetables left, along with spices and condiments but nothing else.  They were apparently too late.

As they were leaving the store, Jill thought, "what about dog food" for our 3 beloved canine children?  Just as she started to say something, shots rang out and a big commotion near aisle nine.  Oh my God said Jack, this whole thing is breaking down!  They rushed out of harm's way, got in their car and sped home.  How could this happen they wondered as the stock market was near all-time highs?  How could "hackers" create such a havoc and now apparently some lives are going to be lost?  How could this happen, THIS IS AMERICA!  

As they pull into their subdivision with the intent of getting online to get a better idea of what was actually happening, they are stunned when they see a sign at the front gate.  The sign says "MANDATORY MEETING for ALL HOMEOWNERS tonight at 7:00 PM".  They just look at each other and say "this is not good".  What is going to happen?  They were about to find out!

With trepidation, Jack and Jill showed up at the completely filled community center, the pitch and decibel level were off the charts.  So much commotion and so loud, until some guy started clanging two metal garbage can tops together to get people to quiet down.  As it turns out, the "guy" happens to be a long time County Sherriff's Deputy, Dave.  He informs the crowd that they are now on their own, as is everyone else in the country.  The banking system has come down and will not be back up for an indefinite period of time, "the big one" everyone knew was coming but had ignored for so long, has finally arrived.  The National Guard has been called out to the cities as have regular military.  The cities are war zones he says, it's only a matter of time before it spills out and into the suburbs.   

The deputy also informs everyone that he will not be going to work the next day as he would not be paid anyway.  He lives in this neighborhood and plans to stay home to protect his family and belongings, he also informs "all of my other coworkers have made the same decision," we are all on our own now.  Most shocking to Jill was when he asked for a show of hands as to who had firearms and who didn't.  She had no idea that almost three quarters of her neighborhood had guns.  She was not a real fan of guns but Jack convinced her they should get their concealed handgun licenses.  They had had their licenses for several years but the sad part is they never bought any guns because they didn't see any immediate need, they do now!   

Deputy Dave pretty much took over from that point.  He chose who he wanted "guarding the gates" for a rotation on a 24 hour basis.  The neighborhood also had several ex-military personnel.  In almost light switch fashion, the community turned into a functioning military garrison.  He also made clear, any crime from within would be dealt with swiftly and severely, theft of anything from within would be considered a capital offense.  Groups began to form.  Close neighbors began to group up and talk to each other.  Jack and Jill saw three of their immediate neighbors all together and approached them.  What are we going to do they all asked?   

What exactly did "indefinitely" mean?  One neighbor said he didn't think there would be much of a problem for more than a week or so as his computer geek friends told him the problem was being fixed.  Another neighbor said he wouldn't be so sure of that, the Chinese have asked for an audit of U.S. gold and would not accept any dollars for any trade until they were satisfied we still had some gold to back our dollars.  He went on to say the Chinese were rumored to be paying $50,000 per ounce for any and all gold for sale which would make U.S. gold worth trillions of $ ...if we still had it.  Jack asked the question, "what does gold have to do with any of this, dollars are in the banks, not gold?"  You see, Jack, (like 95%+ of the populace) even being in the financial world didn't understand what was happening even after the fact.  His ignorant bliss was being shattered.

Several days passed, the dog food was almost all gone.  Jack looked in the pantry and calculated they could keep eating for another 5 days before the food was completely gone.  There had been talk about food pantries the government was setting up in cities, word also got around about one opening in the little town three miles away.  Jack thought to himself, at least we won't starve.  His relief then turned to panic as Jill came in from next door, she was just informed that one of the neighbors was shot and killed as he was leaving town.  He had gone in and bartered for a little bit of food, now, he and the food were both gone.  In less than one full week, the United States had gone from "model civility" to lawlessness.

Jack was furiously thinking about what he could do to feed his family.  He remembered the little old lady down by the river who had chickens, maybe he could buy some eggs?  She was only two miles away and it would be safe to go on foot by jumping a couple of fence lines, so he told Jill his plan and set out with his $300 cash in hand.  Sure enough, the little old lady was there and she met Jack with a shotgun pointed, she remembered him though from the bank.  Jack asked if he could buy some eggs and she said "with what?".  Jack told her he would gladly give her $20 for a dozen eggs and the old lady just laughed at him.  He said "how about $100 for a dozen?" she laughed again and said he couldn't have any eggs for $1,000.  She would however consider accepting something "real" in exchange.  If he had a bicycle, or some 20 gage shotgun shells or something she could use, then he'd have some eggs.  She thought to herself, this guy is a banker and understands money, maybe he has silver for exchange? ... (Fat chance, I had to throw this one in for laughs!)  

Jack got back home and told Jill the bad news about the eggs, he said the old lady actually wanted "something" for the eggs instead of his dollars.  Jill now thought to herself, maybe jewelry or cooking utensils?  What about her handheld sewing machine?  Jill made the trek herself and did end up coming back with two dozen eggs and a promise for four dozen more next over the next 2 weeks so at least they would have something be it ever so small to eat for a time.   

This little bright spot turned dark pretty quickly as all of a sudden the lights went out.  They had not thought of this, nor did they think about their water supply.  People were getting sick from drinking the water as the plant workers were not working to purify it.  But now, now that the electricity is out, so is the water supply.  No electricity = no pumps, no pumps = no flow, could it get any worse?   

Jack and Jill lived for this first two week period after the banks shut down as well as they could considering their circumstances.  They had little food stocked up.  Nothing much to barter with.  Even though they only lived two miles from a river, they had no way to purify water.  If they did have food stocked up, they didn't have any guns or ammunition to protect it (but they did have their "licenses!") or themselves from other hungry souls in search of food.  They went from a casual dinner together one Friday night to living like barbarians within two weeks.  They had no clue whatsoever was coming, and when it did, they had no idea nor ability to deal with it.

As I mentioned at the beginning, this saga is fodder for an entire book.  I apologize for not touching on all facets but it just could not be done in the space available.  Suffice it to say, when the banking system comes down, EVERYTHING will change.  Think of what life will be like within cities?  Think about the average American today.  50 million live on food stamps and over half have less than $500 in savings.  These people don't have the ability to prepare.  Think of the millionaires out there who have their wealth in banks?  Or in stocks which cannot be traded?  How many Americans can live off of the land today?  Five percent?  Less?   

Without credit, nothing will work.  Distribution will definitely break down which means after the shelves are cleared, they will not be re stocked.  A new currency, one the people can have faith in as well as one that foreigners will accept will by necessity be introduced.  How long a banking/system closure takes place is anyone's guess, however, it is not a guess that a financial panic will engulf the U.S. as well as most of the world.  We have lived a fantasy which has also engulfed "values" of all sorts.  Asset values, wage values as well as social values.  All of these will be re set.  I can assure you, the "mindset" of this nation will change more drastically than any time in her history.  I believe we will see a major shift in ideology, ethics and faith.  If anything good can come from what I believe is coming, it will be this shift in thought process toward truthfulness and godliness.  We as a nation have been moved so far down the rabbit hole on purpose to hide what was happening.  Our society has been so dumbed down, the really sad part is when the tsunami does hit ...the majority will still not understand why.   

 I assume if you are reading this then you already know "why," your job now is to decide "what?".  "What?" ...as in what you should do to prepare the best you can for what is mathematically coming! 

Which Horror Is Worse?

December 29, 2014

I'm on vacation in Arizona, but had to comment on the unfathomable amount and breadth of "horrible headlines engulfing the planet - as symbolized by yet another missing Southeast Asian passenger airliner. Frankly, I cannot recall a Christmas week with so much "breaking" bad news; as typically, even the worst potential stories manage to "hold out" until the New Year. But not so this year, as the myriad tentacles of the collapsing global Ponzi scheme know no bounds - which is probably why, despite the PPT's goosing the "Dow Jones Propaganda Average" to an all-time high Friday - amidst the lowest single-day volume in eight years - the Cartel had to utilize every capping algorithm in its book to prevent gold from taking out its nearly three month "line in the sand" at $1,200/oz.; which frankly, we believe they are defending so staunchly because if gold closes the year above $1,205/oz., it will have closed in positive territory despite historic levels of anti-gold propaganda and unrelenting massive paper raids.

Moreover, the burgeoning "story of the decade" - i.e., the energy sector collapse that will ultimately have a much more devastating impact than the mid-2000s mortgage bubble - is dramatically worsening. In fact, TPTB have become so terrified that the oil price collapse will take on a "life of its own," they have actually started, in the last two weeks, using the same paper manipulation algorithms on oil as they do on stocks, precious metals and Treasury bonds. In fact, I last week coined the "new, new Hail Mary trade" in watching the blatant goosing of oil every day over the past two weeks - both in the early New York hours and just before the NYSE close. Unfortunately for them, on all but one of the past nine days such pathetic, transparent machinations have failed - yielding a week-ending crude oil price barely above five-year lows. But more on that in a second, as several other horrors need to be mentioned first.

First off, it's all but "official," the holiday season will likely end up one of the worst in memory. On last week's year-end Audioblog, I spoke of how ridiculous the MSM's holiday cheerleading has become - as if "strong" retail sales would "mean" anything in the first place. The fact is the 11% year-over-year plunge in "Black Friday" weekend sales was a perfect representative of the real economy and no amount of hope, hype or propaganda could change it. Reuters did its best on Saturday to claim holday sales were "strengthening" in the home stretch, but all their shallow propaganda did was make yesterday's pathetic follow-up article that much more so. And per what I discussed about CNBC's equally ridiculous hype of the number of packages delivered by Fedex - as opposed to the profitability of such deliveries - UPS just announced the expectation of a 15% industrywide surge in return shipments. Of course, the coup de gras will come a month from now when utterly awful retail corporate earnings are released; but in the meantime, get ready for some of the biggest "clearance sales" of our lifetimes. And once the earnings catastrophe is unleashed, the next step will be massive layoffs, store closings and commercial real estate liquidations.

Next up, is the utter "horror" that is Abenomics; which ironically, the hopelessly clueless Japanese people just "re-upped" in last week's snap elections. This week, the Bank of Japan overtly purchased more Japanese stocks than ever before, pushing the Nikkei to a new multi-year high (albeit, 56% below the all-time high set 25 years ago). However, the nation's economy plunged to a new multi-decade low, with debt exploding toward 250% of GDP as real wages were reported to have plunged at their most rapid rate in 15 years. Consequently, Japanese ten-year yields fell to an incredible 0.31%, as the Bank of Japan buys every bond offered, enroute to its inevitable oncoming hyper-inflation. Meanwhile, right next door in China, the PBOC again surprised the world by loosening monetary policy Friday morning - knowing full well the Chinese economy, too, is in freefall. Clearly, the PBOC recently "learned" how to manipulate the stock market like the Fed does in the States - managing to goose the Shanghai Exchange an incredible 55% in the past six months, whilst absolutely all aspects of the Chinese economy freefall. Oh well, just as U.S. stocks have never been more expensive - or corporate earnings more fraudulent - China's market, featuring a record amount of margin account openings - has never been a larger bubble simply awaiting a pin.

Geez! I haven't even mentioned the continuing collapse of global currencies - or as MSM propaganda will deem it, the "strengthening dollar" (LOL); nor record high French unemployment; the Ukrainian government cutting off electricity to the Crimean peninsula; China extending its financial support of Russia, whilst Vladimir Putin signs a new "military doctrine" naming the U.S. and NATO as enemies. Or the unbelievable fraud that was U.S. "third quarter GDP"; an utterly catastrophic New Home sales report Thursday morning - validating the prior week's equally horrific Existing Home sales report; and oh yeah, the fact that today, the Greek Parliament will probably mandate an early 2015 "snap election" - which may well commence a new far more devastating PIIGS crisis. Which, we assure you, will not be reversed by simply promising to do "whatever it takes."

Sadly, despite all the aforementioned, none will hold a candle to the cumulative impact of the global energy collapse, which must dramatically worsen until all the world's high cost production is driven into permanent "mothball"; and with it, the trillions of high-yield finance underlying it. Frankly, even I was taken aback by the sheer speed of the price implosion, mirroring 2008 nearly exactly thus far. However, this time around the "oil patch" is dramatically more leveraged, global demand is dramatically lower, and global Central banks will be helpless to stem the tide by simply publishing propaganda, printing money and manipulating financial markets.

In our view, today's collapse is nearly entirely a financial phenomenon created by Federal Reserve-led money printing and Wall Street lunacy. As we wrote in "2015 Shale Oil = 2008 subprime mortgages," suppressing interest rates, propping the stock market, and allowing Wall Street to do whatever it wants was the principal cause of the worst real estate bubble of our lifetimes - which, sadly, is just getting started. And given the unstoppable acceleration of the "final currency war," all global Central banks followed suit, creating similar housing bubbles the world round. This time around, as most real estate markets continue to deflate, the Fed inadvertently created a "serial bubble" in global energy production - which ominously, involves significantly greater leverage, overcapacity and geopolitical ramifications. If you don't believe me, read this terrifying article about what's going on in Brazil; i.e., one of the "BRICS" supposedly leading the 21^st century economic world.

Frankly, the pace of the worldwide, industry wide energy collapse has been breathtaking - which is probably why Saudi Arabia and numerous other low-cost nations, are actively preparing for prices as low as $20/bbl. As I write, an incredible one trillion dollars of oilfield capital expenditures are on the verge of cancellation - including one-third of S&P 500 capital expenditures and corporate revenues. Amazingly, both the GDP and employment contributions of energy have been well above the total U.S. levels reported. In other words, without energy, even the government's best economic data cookers would have reported negative NFP jobs and GDP numbers - which is exactly what's on tap for 2015, both in the U.S. and overseas.

In fact, it's not just crude oil but all energy products in freefall - and based on historical correlations, crude should be well below its current price as I write. Of course, the only reason it isn't is the aforementioned paper games TPTB are playing whilst they "pray" for a miracle. However, just as gold and silver cannot be held below their respective "equilibrium prices" forever, oil will not be able to be supported as the gaping global supply/demand gap widens. To wit, global crude oil inventories hit their highest November level ever this week, whilst natural gas prices plunged 15% in the past two days alone; in the latter case, during the time of year they typically surge. And the scariest number of all - again, reported by the great David Stockman, is that at current prices, 2015 OPEC oil revenues will decline by an incredible $500 billion - a number, of course, that excludes a roughly equal plunge from non-OPEC nations like the U.S., Russia, Norway, Brazil and Mexico. In other words, the biggest "deflationary" shock of our lifetimes - which in a world of historically high debts and stock valuations supported by historically low interest rates can only yield an exponential increase in Central bank money printing - inevitably, yielding the global hyper-inflation that destroys nearly five decades of economic and financial lunacy.

Well, that's enough for now - so I can get back to my vacation. However, as we head into what could - and likely will - be a historically "horrible" 2015, keep in mind that global physical gold and silver demand will close 2014 at record levels - with no end in sight to such growth and a likely PM production cataclysm that could last for years.

In The News Today - www.jsmineset.com

Posted December 24th, 2014 at 4:26 PM (CST) by Jim Sinclair

2015 Will Be A Year Of Surprise, Panic, Desperation & Radical Change

Today one of the greats in the business warned King World News that 2015 will be a year of panic, desperation, and radical change for the world.  He also said 2015 will be a year of surprises that will have an incredible impact not only people but also major markets and economies around the globe.

Egon von Greyerz:  "As we approach 2015 the world is on the cusp of a deflationary collapse.  Central banks around the world are fighting trying desperately keep their economies afloat.  Zero percent interest rates are no longer helping, so negative interest rates have been introduced in an attempt to create inflation....

More...

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Financial Fantasy Land Continues to Prevent Collapse-Bill Holter - www.jsmineset.com

Posted December 24th, 2014 at 3:32 PM (CST) by Jim Sinclair

By Greg Hunter's USAWatchdog.com

Dear CIGAs,

Financial writer Bill Holter says the record stock market does not reflect reality.  Holter explains, "This will go on until it doesn't.  Very quietly, this past week, they postponed the "Volcker Rules" for the banking system.  The reason they did that is they can't allow the Volcker Rule to come into place.  That would require increased capital ratios.  It would bring mark to market back.  We live in a financial fantasy land, and they need to continue the fantasy to prevent collapse."

The recent spending bill passed by Congress, which puts taxpayers on the hook for more than $300 trillion in future derivative losses, is another ominous sign financial trouble is coming.  Holter contends, "It tells me that they know something.  They know something we suspect, and they know something they don't want to tell us.  They know a crash is coming and they are preparing.  For the Republicans to vote "yes" on this after they won a landslide election is throwing the voters under the bus.  People voted for change and we got change, but it was change into a greater direction of taxpayers being screwed."

So, how long can this "financial fantasy" last?  Holter, who has more than 30 years experience on Wall Street and finance, says, "I have no idea.  I say I have no idea because I would have thought a complete credit contraction and collapse would have and should have already occurred.  The Federal Reserve with QE (money printing) and the Plunge Protection Team manipulating basically all markets have held it together.  It is being held together with confidence and confidence alone.  So, when will the wheels fall off of this thing?  It could be tomorrow morning; it could be January 5th, the first trading day of 2015.  It could be anytime, but it's going to happen."

On the new so-called trading "collars" on gold and silver prices, Holter says it is another tipoff on where the precious metals prices are going.  Holter thinks, "It's to prevent a disorderly rise and not a disorderly collapse in prices.  How far can it go from here?  It is $6 to $8 below the cost of production."

More...

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Jim's Mailbox - www.jsmineset.com

Posted December 24th, 2014 at 2:34 PM (CST) by Jim Sinclair

Below is a skit with a UK comedian and Max Keiser. Unfortunately it is all too true especially now that bail in has been legalized globally.

http://www.russellbrand.com/2014/12/the-terror-of-how-banks-use-our-money-the-trews-e216/

India's Gold Imports Down in December - www.caseyresearch.com

By Ed Steer

December 27, 2014

The Wrap

I was somewhat surprised to see these rallies in all four precious metals yesterday---and happy to see that the precious metal equities turned in decent performances for the second day in a row as well.  I wasn't overly amused with the fact that these rallies got capped in one form or another, but it's certainly obvious that they were.

Gold, silver and platinum rallied to their respective 50-day moving averages---and palladium is now back up to its 200-day moving average.  It will be interesting to see if they are allowed to break above these averages, as it was a certainty that 'gentle hands' were there yesterday to make sure that those events didn't occur.

Casey Research

Casey Research

But, just like the price moves to the downside, these moves to the upside are all paper trading on the COMEX as well---and are light years removed from anything remotely close to real-world supply and demand fundamentals.  JPMorgan et al are still in firm control of the precious metals.

We have 2.5 business days left in the month---and the year---and after Friday's performances, I'll be more than interested in what happens in the final days.

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$300,000 in Gold Missing From Ukraine Central Bank, Swapped For Lead Bricks - www.caseyresearch.com

By Ed Steer

December 23, 2014

The Wrap

Because it controlled the price of silver, JPMorgan profited handsomely on its COMEX manipulation thru 2010---and not even an ongoing CFTC investigation interfered with JPM's control on silver prices. However, in late 2010, investor demand for physical silver caused silver prices to break above the highs of early 2008 and JPMorgan could no longer control the price of silver through excessive paper short selling on the COMEX. Physical silver conditions tightened so much by the end of April 2011 that the price reached nearly $50 and, quite literally, JPMorgan (along with other collusive CME traders) were staring into a financial catastrophe, the same as undid Bear Stearns three years earlier.

But no bailout of JPMorgan was possible---and instead, the bank along with interested parties at the CME Group, arranged for a disorderly takedown of silver prices, almost assuredly with the approval of U.S. regulatory officials. The disorderly takedown proved successful and the big shorts, particularly JPMorgan, escaped what would have been an epic financial catastrophe had they been forced to cover their massive silver short positions.

It is said that one learns more from failure, especially near disaster, than from success. It is my belief that at the time of JPMorgan's near catastrophe in being short silver into April 2011 that the bank realized just how limited and critical the supply of silver in the world was and decided to use that near-death experience to their advantage. It was at that time that the bank decided to buy as much physical silver as it could in order to profit even more to the upside than it did previously to the downside. - Silver analyst Ted Butler: 20 December 2014

Well, it doesn't look like JPMorgan is in the Christmas spirit this year, or any other year for that matter, as only palladium was spared the engineered price decline.  I didn't see any news that would have precipitated such moves, but it had all the hallmarks of 'da boyz'---news, or no news---and anyone who has been around the precious metals market with an open mind knows that yesterday's price action was as far away from a free market as you can get.

As GATA's Chris Powell said, "There are no markets anymore, only interventions."

Continue reading on Casey Research.com.

Game Over Japan: Real Wages Crash Most In 21st Century, Savings Rate Turns Negative - www.zerohedge.com

Submitted by Tyler Durden on 12/26/2014 22:09 -0500

When about a month ago it was revealed that Japan's shadow economic advisor is none other than Paul Krugman, we said it was only a matter of time before the Japanese economy implodes. Terminally. We didn't have long to wait and last night the barrage of Japanese economic data pretty much assured Japan's transition into failed Keynesian state status.

Continue reading on Zero Hedge.com.

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China To Launch Yuan Swap Trading With Russian Rubles On Monday - www.zerohedge.com

Submitted by Tyler Durden on 12/26/2014 08:20 -0500

It was only this week that Bloomberg reported that "China Offers Russia Help With Currency Swap Suggestion." But in order to fully backstop Russia away from a SWIFT-world in which the dollar reigns supreme, one extra step was necessary: the launching of direct FX trade involving the Russian and Chinese currencies, either spot or forward - a move away from purely theoretical bilateral FX trade agreements - which would not only enable and make direct currency trading more efficient by sidestepping the dollar entirely, but also allow Russian companies to budget in Chinese Yuan terms. It is no surprise then that this is precisely the missing step that was announced overnight, and will be implemented starting Monday.

Continue reading on Zero Hedge.com.

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Did The Saudis And The US Collude In Dropping Oil Prices? - www.zerohedge.com

Submitted by Tyler Durden on 12/24/2014 11:58 -0500

The oil price drop that has dominated the headlines in recent weeks has been framed almost exclusively in terms of oil market economics, with most media outlets blaming Saudi Arabia, through its OPEC Trojan horse, for driving down the price, thus causing serious damage to the world's major oil exporters - most notably Russia.

While the market explanation is partially true, it is simplistic, and fails to address key geopolitical pressure points in the Middle East.

Continue reading on Zero Hedge.com.

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SF Fed Warns US Equity Valuations Will Be Cut In Half In Next Decade - www.zerohedge.com

Submitted by Tyler Durden on 12/25/2014 16:45 -0500

When "the retirement of the baby boomers is expected to severely cut U.S. stock values in the near future," is the ominous initial sentence from no lesser maintainer-of-the-status-quo than the San Francisco Fed's research department, one begins to recognize the Federal Reserve's overall need to hyper-inflate asset prices at whatever cost for fear of the 'wealth' destruction looming. As the following study reports, projected declines in stock values - based on the latest demographic and valuation data - have become even more severe. Our current estimate suggests that the P/E ratio of the U.S. equity market could be halved by 2025 relative to its 2013 level.

Continue reading on Zero Hedge.com.

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The Fed Is Heading For Another Catastrophe... Central Banking Has Lost Its Way" Stephen Roach Warns - www.zerohedge.com

Submitted by Tyler Durden on 12/24/2014 10:17 -0500

America's Federal Reserve is headed down a familiar - and highly dangerous - path. Steeped in denial of its past mistakes, the Fed is pursuing the same incremental approach that helped set the stage for the financial crisis of 2008-2009. The consequences could be similarly catastrophic.

The Fed's incrementalism of 2004-2006 was a policy blunder of epic proportions.

The Fed seems poised to make a similar - and possibly even more serious - misstep in the current environment.

In these days of froth, the persistence of extraordinary policy accommodation in a financial system flooded with liquidity poses a great danger.

Continue reading on Zero Hedge.com.

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Could An Energy Bust Trigger QE4, Peter Schiff Asks - www.zerohedge.com

Submitted by Tyler Durden on 12/23/2014 19:40 -0500

Despite the widely held belief that 2015 will be the year in which a patient Fed finally begins to normalize rate policy, we believe the Fed has no possibility of withdrawing the stimulus to which it has addicted us. QE4 was always much more probable than anyone in government or on Wall Street cares to admit. A recession and a financial panic caused by sub $60 oil will significantly quicken the timetable by which the Fed cranks up the presses. When it does, oil could once again increase in price, along with all the other things we need on a daily basis. That should finally dispel any remaining illusions that the Fed could successfully land the metaphorical plane. More QE may minimize the damage in the short-term, but we believe it will keep us trapped in our current cocoon of endless stimulus, where we will slowly suffocate to death.

Continue reading on Zero Hedge.com.

***

Here Is The Reason For The "Surge" In Q3 GDP - www.zerohedge.com

Submitted by Tyler Durden on 12/23/2014 23:45 -0500

So what did Americans supposedly spend so much more on compared to the previous revision released one month ago? Was it cars? Furnishings? Housing and Utilities? Recreational Goods and RVs? Or maybe nondurable goods and financial services?

Actually no. The answer, just as we predicted precisely 6 months ago is... well, just see for yourselves.

Continue reading on Zero Hedge.com.

____________________________

Embedded with IS group: West 'underestimates the danger' - www.france24.com

German journalist Jurgen Todenhofer, who recently spent 10 days with Islamic State (IS) militants in Iraq and Syria, tells FRANCE 24 they buy Western weapons from Syrian rebels and envision a future that includes a massive "religious cleansing".

Todenhofer, 74, said he spent several months negotiating a deal with IS militants that would allow him to visit their self-proclaimed "caliphate", which the group has carved out of vast swaths of Iraq and Syria, leaving behind a trail of death, rape and pillage.

The German reporter said he encountered numerous foreign fighters who had joined the jihadist cause, including dozens of Frenchmen, US citizens from New Jersey and "the son of one of the richest bankers [in] London". He described IS fighters as tough, well-trained, and convinced they are achieving "something great, something historic".

Islamic State group militants share a world view that calls for a massive "religious cleansing" and which envisions a future with only three religions - a "very rigid" form of Islam, Judaism and Christianity.

"All the other religions have to be killed, have to disappear," Todenhofer said, adding that the militants envisage this would involve the elimination of "hundreds of millions, even billions" of people.

Continue reading on France 24.com.

The Destruction of the Middle East - www.gatestoneinstitute.org

by Denis MacEoin
December 27, 2014 at 5:00 am

The heritage of centuries has been wiped out in little more than a year.

Eventually the need to wipe out all traces of unbelief becomes obsessive. At one time, for instance, Egyptian law demanded that any house found to contain a copy of The Apology of al-Kindi (a book containing a polemical dialogue between a Muslim and a Christian) would be demolished along with 40 houses around it.

Ethics were defined by what Allah said was good or evil in Sharia law. The Islamic State's behavior is solidly rooted in Islamic ideology, law and practice. It is only when this fundamental fact is grasped that we will be able to address what confronts us.

There are many wise and sensible Muslims who favor a shift to a more updated way of thinking. It is their mosques and shrines that are being crushed; it is their heritage. Today, such Muslims use the freedoms bestowed on them in the West to write, network and debate their opposition to fundamentalist interpretation of Islam by the Islamic State and other supporters of murder and destruction.

We are living through ferocious times. Stories about the self-proclaimed Islamic State [ISIS/ISIL/Da'esh] abound in the media, in what has now become a daily round of beheadings, suicide bombings, and general mayhem from Nigeria to Malaysia. It seems that wherever there is a Muslim country, there is extreme violence. But one part of the Islamic State narrative has received less attention than the gruesome rounds of killings: the continuing onslaughts on cities such as Mosul, Aleppo, Raqqa and Kobani. The Islamic State and related movements have rampaged across parts of Iraq and Syria, destroying the entire heritage of ancient regions, demolishing historic churches, synagogues, mosques, Sufi and Shi'i shrines, and major archaeological sites. All this vandalism is driven by a relentless passion to enforce religious purity on the regions they now control.

Around the world, art historians, antiquities experts, and archaeologists scarcely dare open their e-mails every day, fearing loss of another irreplaceable site. Physical destruction in the Islamic realms has now reached proportions of the Mongol invasions of the thirteenth century.

In Mosul, the Islamic State set out on an operation of "cultural and historical cleansing" across the city. The group deploys a unit called the Kata'ib Taswiyya, or settlement battalions, who are ordered to identify sites for culling. The unit razes to the ground any mosques, churches or, invariably, shrines that have been built over tombs; such places may attract devotees to pray in them, thereby creating polytheism -- in Islam one of the crimes most censured. In addition, the painting or sculpting of the human form is anathema; if man was created in God's image, to represent man is to presume to know God and therefore to diminish Him.

Graveyards are flattened, headstones are bulldozed, and statues of cultural significance to the people of Mosul are destroyed.

As we face the Islamic State and all the rapidly expanding jihadist movements in the Middle East and beyond, we are starting to recognize that airstrikes have only limited results. If we are to contain or defeat the adversaries in our midst, we have to understand their motivation, their psychology, and their sense of rootedness.

Politicians who proclaim that Islam is a religion of peace do us a disservice; Islam has never been at peace with the world around it. The Islamic State's behavior is solidly rooted in Islamic ideology, law and practice. Only when this fundamental fact is grasped will we be able to address what confronts us. It is time that not only active jihadists, but their ideological sponsors in Salafi, Wahhabi, Mawdudist, and other classical and modern interpretations of Islam, be discussed openly before they do more harm. They and we do not have the leisure to wait until the oil money runs out and leaves the Saudis or Qataris weak.

We must learn to speak the truth, especially in high places. In the tenth century, Islam abandoned reason and rational pursuits in favor of revelation and revealed law that could not be challenged. Ethics were defined by what Allah said was good or evil in Sharia law. Islam has remained frozen ever since. We cannot go on patronizing this, and nodding acceptance that Muslims know best. Very few grasp the quandary in which non-extremist Muslims, like their ancestors, are captured. Western rationalism, Western ethics, and Western standards of peace and justice need to remain, or the world we know could be trampled underfoot by men and women who prefer death to co-existence, and fundamentalism to tolerance.

There are many wise and sensible Muslims who favor a shift to a more updated way of thinking. Many cannot openly declare their thoughts for fear of reprisals and even execution; others are faithful Muslims who see a desperate need for a valid reinterpretation of their religion.

Today, such Muslims use the freedoms bestowed on them in the West to write, network, and debate their thoughts about the fundamentalist interpretation of Islam by the Islamic State, other Salafis, Wahhabis, Mawdudists, and all other clerics and extremist supporters of murder and destruction. It is their mosques and shrines and ancient monuments that are being crushed; it is their heritage -- as much as that of Jews, Christians, Yazidis and Baha'is -- that is being wiped from the pages of history.

Losses so far include:

• The statues of Mulla 'Uthman al-Mawsili (1845-1923), a famous musician and poet, of a woman carrying an urn, and of Abu Tammam (788-845), author of the celebrated Hamasa, one of the greatest literary compilations ever made in Arabic.

• The destruction of the greatly venerated tomb of 'Ali ibn al-Athir al-Jazari (1160-1233), a major landmark that had stood in the center of Mosul for centuries. Ibn al-Athir is celebrated as the author of The Complete History, one of the most important histories of Islam ever written.

• The Islamic State's destruction of the Tomb of Yunus (Jonah) Mosque, which was blown to pieces along with all its contents. Even before the explosion, fighters took sledgehammers to ancient tombstones in the building. The mosque was of importance not just to the Muslims of the city, but as a place of pilgrimage for Jews and Christians. St. George's Monastery church, one of the oldest in the region, has also gone forever.

• In Kirkuk, the Islamic State has destroyed the tomb of the Prophet Daniel, and in Nineveh, the ancient ruins of which lie across the River Tigris from Mosul, sprawl damaged archaeological ruins.

• In Mosul, the 13th-century shrine of Imam Awn al-Din -- with a stunning vaulted ceiling, designed to resemble a honeycomb, inside a pyramid-shaped tower on the banks of the Tigris, and among the city's most precious sites -- was one of the very few structures to have survived the devastation of the 13th-century Mongol invasion On July 25, 2014, members of the Islamic State reduced it to rubble.

• In Tikrit, the city's most famous and most beautiful church of St. Ahoadamah, known as the Green Church, dating from the 7th century, has been erased from history.

• In Syria, the Jabhat al-Nusra's destruction of the Deir el-Zour Armenian Church, that stood as a memorial to the 1.5 million slaughtered in the Armenian genocide in Turkey, was blown up.

• In Mali, much of UNESCO's World Heritage Site of Timbuktu (Mali) was destroyed during the battles of Gao and Timbuktu, fought between the National Movement for the Liberation of Azawad and the Islamist Movement for Oneness and Jihad in West Africa between June 26 and 27, 2012. Afterwards, the Islamist group Ansar Dine went on a rampage identical to that of the Islamic State. An official for the group, Abou Dardar, boasted that "not a single mausoleum will remain in Timbuktu."

• Sufi shrines have been pulverized in Egypt, Libya, Mali, Pakistan, Iran, Somalia, Sudan, Tunisia, Morocco, India, and the Balkans.

• In Bahrain, 43 Shi'i mosques and tens of other religious structures have been destroyed and damaged by the ruling Sunni government there.

• Across Syria and Iraq, ancient archaeological sites have been wrecked. They were not just the heritage of those countries, they were central to our understanding of the ancient world, where human civilization first developed in city-states. Apamea, with its famous colonnade and beautiful mosaic, capital of the Seleucid empire, was a major center of Roman rule in the Levant, a leading city in Byzantine Syria, and at one time among the best-preserved archaeological sites in the region. Today, it looks like the face of the moon. Its devastation, the work of demolition done by looters using heavy earth-moving machines, took a mere four or five months.

• In eastern Syria, one of the world's richest archaeological remains, Dura-Europos, the "Pompeii of the Syrian Desert," was obliterated. Remarkable finds had been brought to light: temples, wall decorations, inscriptions, military equipment, and tombs. It had been home to a third-century painted synagogue as well as to the oldest example in the world of a Christian house-church, which contained the earliest depictions of Jesus Christ ever found, dating back to 235 AD. The Islamic State looted the site and, as elsewhere, has apparently sold its treasure on the black market of the antiquities trade, presumably using the proceeds to inflate their already swollen coffers for the promotion of jihad.

• Both Shi'i and Sufi shrines and mosques have fallen afoul of the Islamic State's fanaticism. Jewish sites have been targeted so extensively that UNESCO has held a special session on threats posed to them. UNESCO's Director-General Irina Bokova has described the Islamic State's activities in this respect as "a form of cultural cleansing." Many other Jewish sites were also destroyed or under threat from Islamist entities in Libya, where an ancient Jewish heritage was all but wiped out under the regime of Mu'ammar Qadhafi, and where what is left is succumbing to fresh attacks.

The Islamic State, however, does not restrict its demolition to Christian, Jewish or pagan sites. Its members have also evidently culled what may be thought of as their own heritage. In Tikrit, they demolished the country's oldest Islamic site, the Arba'in (Forty) Shrine and mosque, where forty of the companions (Salaf) of the Prophet were buried.

In this, there is desperate irony, for the form of Islam followed by the Islamic State is Salafism, based on imitating the ways of Muhammad and his companions.

The heritage of centuries has been wiped out in little more than a year. There will be many who argue that this devastation is, at root, the fault of the West; that its colonization, imperial ambitions, and general interference have forced the people of the Middle East to rise up against Europe and America, and find their only solution in the creation of an Islamic state where Shari'a law will dominate and justice prevail. Nothing could be farther from the truth. Syria was never a French colony, but a mandate territory between 1922 and 1936 -- fourteen years. Lebanon was a mandate territory from 1922 to 1943 -- twenty-one years. Iraq was a British mandate from 1922 to 1932 -- ten years. All were colonies of the Muslim Ottoman empire for centuries: Iraq between 1543 and 1918, Syria from 1516 to 1918, and were, before that, colonies of earlier Islamic empires from the Umayyads to the Abbasids to the Mamluks -- and so on.

This alone exposes the reality, that the actions of groups such as the Islamic State have their true roots in Islam itself. The Prophet and his companions fought jihad wars and destroyed pagan idols as well as places they may have been concerned would become centers for cults. During the Arab conquests, many religious centers were destroyed, notably in India, where temples were looted and razed, and whole towns ruined by the Ghaznavids and Timurids.

Eventually the need to wipe out all traces of unbelief became more or less obsessive. At one time, for instance, Egyptian law demanded that any house found to contain a copy of The Apology of al-Kindi (a book containing a polemical dialogue between a Muslim and a Christian) would be demolished, along with forty houses around it.[1]

In more recent times, in 1802, during the first of the three Saudi states, Wahhabi armies attacked the major Shi'i religious town of Karbala in Ottoman Iraq, where they killed 5,000 inhabitants and destroyed the shrines of Muhammad's son-in-law 'Ali (the first Shi'i imam and the fourth Sunni caliph) and his son Husayn, the prophet's grandson. The following year, Wahhabi forces under the leadership of the first Saudi ruler, 'Abd al-'Aziz, entered Mecca, where they destroyed tombs and shrines, and in the process, removed much of the city's history -- as is being repeated today in Mecca and Medina.

Between 1913 and 1927, extremist Wahhabi forces, known as the Ikhwan, rampaged through the Arabian peninsula, much as members of the Islamic State do now, killing and destroying anyone and anything they deem contrary to the Puritanism of their creed, which extremists interpret as preaching the annihilation of all that is not Islam.

Today, the Mecca and Medina of the first and second centuries of the Islamic faith have been all but wrecked, not by the Islamic State or any other radical entity, but by the Wahhabi Saudi government. Over the past two decades, major historical sites in Mecca and Medina, all related to the lifetime of the Prophet and shortly after, have been destroyed or disfigured to the point where neither city is recognizable save for the Ka'ba and the Grand Mosque in Mecca, and the Prophet's Mosque in Medina.

Although much has been done to accommodate the increasing millions of pilgrims who go there for the hajj pilgrimage, most of the demolition appears to relate to a Wahhabi and Salafi fear that pilgrims may pray at the graves of Muhammad's companions, at the house where he was born, or at other buildings associated with the first era of Islam. There seems to be an insistence that anything that might compromise God's oneness must be eradicated, and this concern may have prompted the country's rulers to destroy them.

The vast Jannat al-Baqi cemetery, which holds so many remains of Muhammad's family, close companions and the earliest Muslim saints, has been leveled, and all domes and mausoleums turned to dust. That act followed earlier leveling by Wahhabis in 1206 and the Ikhwan in 1925. Those included the graves of the martyrs of the Battle of Uhud and that of Hamza, the prophet's uncle and most beloved supporter. So too the Mosque of Fatima (Muhammad's daughter), the Mosque of the Manaratayn (the twin minarets), and the cupola that marked the burial place of the prophet's incisor tooth.

In Medina as well, the home of Muhammad's Ethiopian wife, Maryam, where his son Ibrahim was born, has been paved over.

In Mecca, the house of his first wife, Khadija, the first person to whom he divulged his mission, has been turned into public toilets. In 1998, the grave of the prophet's mother, Amina bint Wahb, was bulldozed in Abwa, after which gasoline was poured on it. There is much more.[2]

Destruction of the sacred places of rival faiths or denominations is nothing new; it has happened throughout history. Henry VIII wrecked Catholic abbeys and monasteries; their ruins still pepper the English countryside. The destruction of the Babri Mosque in Ayodhya by Hindus in 1992 led to two thousand deaths. The Roman demolition of Judaism's Second Temple marks a watershed in world history and is central to the current conflict in the Holy Land. But the most consistent use of elimination through the centuries has been the Muslim war on non-Muslims. Despite much controversy, it has been claimed that over 2000 Hindu, Jain and Buddhist temples and holy places were destroyed by Muslim conquerors in India. Churches and synagogues have been demolished or converted into mosques in many places.

When Jordan controlled East Jerusalem between 1948 and 1967, all but one of the Old City's synagogues was reduced to rubble or converted into stables and chicken coops; the main Jewish cemetery was desecrated, and Jewish homes destroyed.

Today, in Iran, the Islamic regime has demolished all the holy sites and graveyards of an indigenous faith, the Baha'i religion.

Dr. Denis MacEoin, based in Newcastle-upon-Tyne, is a lecturer in Arabic and Islamic Studies and a Distinguished Senior Fellow at the Gatestone Institute.

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