Federal Reserve losing control

[MASONIC PLOT]

Gold futures push past 1000.00.

Buckle up.

http://www.theglobeandmail.com/servlet/ ... nergy/home

[ninakat]

Economic Forces Converge Like Never Before
Posted On: Thursday, March 13, 2008, 9:20:00 PM EST
Author: Jim Sinclair

Dear Extended Family,

Never in economic history has there been a night like tonight. I am writing later than usual because of the enormity of all the converging forces. The euro reaches for $1.60, the Middle East oil producers are in shock, and the IMF tells the world to “plan for the worst.”

The reason this missive is late is because I am reverberating at the speed of the disintegration. These cursed OTC derivatives and their makers, who incidentally made the international banking community rich beyond your wildest dreams, are now unwinding at lightening speed.

Do you think any entity with any OTC derivative now has faith in the paper?

This paper is $550 trillion plus dollars in notional value. The horrible fact is that in bankruptcy notional value becomes real value with the capacity to destroy the world financial system.

The above is no wild assumption. It is hard, cold fact.

• 1. Expect currency intervention to slow down the rise of the euro.
  2. Intervention has never worked. It will not now. In fact, it will backfire so fast that the effort will be abandoned, making things even worse.
  3. Intervention in currency, the dollar, will only provide the capacity for other central banks, oil producers and holders of high risk long US treasury paper to diversify out in huge amounts of decaying dollars at singular prices.
  4. I could go through a tome on how intervention works, but accept that any rise in short rates will break the bank immediately. Intervention in the euro/dollar is another practical impossibility except as a bluff.
  5. There is no practical solution to today’s TERMINAL problems and that means you are up to your eyeballs in alligators.
  6. You must protect yourselves.
  7. Gold is going to $1650. In all probability my major error will be in forecasting a price that is much too low for gold.
  8. The ratio spread long the major gold producers, short the juniors is going to kill the math whizzes that think they are in the captain’s seat. The reason is the only value still in precious metals shares lies in the best junior issues these geeks have been hammering.
  9. The prayer that a junior with quality assets has is that the illegal short position is enormous.

This is it!

Your concerned friend,
Jim

[Byrne]

Last Updated: Friday, 14 March 2008, 15:58 GMT

Bear Stearns gets emergency funds

US bank Bear Stearns has got emergency funding, in a move that raises fears that one of Wall Street's biggest names is on the verge of collapsing.

JP Morgan Chase will provide the money to Bear Stearns for 28 days with the Federal Reserve of New York's backing.

JP Morgan is also trying to get long-term financing for Bear Stearns.

Bear Stearns' problems stem from the global credit crunch and the worry is that other lenders may also have major funding problems, analysts said.

Bear Stearns is Wall Street's fifth largest investment bank, and has been at the centre of the US mortgage debt crisis. Recently, speculation had intensified that it was struggling to fund its daily business.

Bear Stearn's creditors have become progressively concerned about Bear's exposure to mortgages, said BBC business editor Robert Peston.

"The rescue of Bear Stearns demonstrates that the worst of the global credit crunch is not yet behind us," he said.

He says that if Bear Stearns had been allowed to collapse, it could have put the whole financial system at risk.

Bear Stearns shares dropped as much as 53% to $28 on the news.

…

BBC business editor Robert Peston said that the move by JP Morgan and the Fed of New York was essentially a central bank bailout.

"In just the last 24 hours Bear Stearns came close to running out of the cash or liquidity it needs to meet its daily requirements," he said.

"So enter the US Federal Reserve. It is promising to supply whatever liquidity is required by JP Morgan Chase, the leading bank, to help Morgan provide whatever funds are required by Bear Stearns.

"Since JP Morgan is saying there is no risk to its shareholders, this represents a central bank bailout of Bear Stearns

"This is America's Northern Rock."


BBC article

[freemason9]

Economic Forces Converge Like Never Before
Posted On: Thursday, March 13, 2008, 9:20:00 PM EST
Author: Jim Sinclair

Dear Extended Family,

Never in economic history has there been a night like tonight. I am writing later than usual because of the enormity of all the converging forces. The euro reaches for $1.60, the Middle East oil producers are in shock, and the IMF tells the world to “plan for the worst.”

The reason this missive is late is because I am reverberating at the speed of the disintegration. These cursed OTC derivatives and their makers, who incidentally made the international banking community rich beyond your wildest dreams, are now unwinding at lightening speed.

Do you think any entity with any OTC derivative now has faith in the paper?

This paper is $550 trillion plus dollars in notional value. The horrible fact is that in bankruptcy notional value becomes real value with the capacity to destroy the world financial system.

The above is no wild assumption. It is hard, cold fact.

• 1. Expect currency intervention to slow down the rise of the euro.
  2. Intervention has never worked. It will not now. In fact, it will backfire so fast that the effort will be abandoned, making things even worse.
  3. Intervention in currency, the dollar, will only provide the capacity for other central banks, oil producers and holders of high risk long US treasury paper to diversify out in huge amounts of decaying dollars at singular prices.
  4. I could go through a tome on how intervention works, but accept that any rise in short rates will break the bank immediately. Intervention in the euro/dollar is another practical impossibility except as a bluff.
  5. There is no practical solution to today’s TERMINAL problems and that means you are up to your eyeballs in alligators.
  6. You must protect yourselves.
  7. Gold is going to $1650. In all probability my major error will be in forecasting a price that is much too low for gold.
  8. The ratio spread long the major gold producers, short the juniors is going to kill the math whizzes that think they are in the captain’s seat. The reason is the only value still in precious metals shares lies in the best junior issues these geeks have been hammering.
  9. The prayer that a junior with quality assets has is that the illegal short position is enormous.

This is it!

Your concerned friend,
Jim

Maybe this is the beginning of the millennial event we've been awaiting.

[ninakat]

Maybe this is the beginning of the millennial event we've been awaiting.

Care to extrapolate? Perhaps another false-flag event to distract people from the economic implosion, with the intent of deflecting the public's attention as well as justifying further imperialistic exploits (including resource wars)? If they do go this route, I think we can expect WWIII and/or global chaos.

[ninakat]

Joke of the Day (warning: have barf bag handy)

President tells Economic Club of New York economy will bounce back and emerge from these times "better and stronger than ever."

http://tinyurl.com/2u5k5h

[Sweejak]

If I hear the word 'robust' one more time I'm gonna need that barf bag.

[Gouda]

President tells Economic Club of New York economy will bounce back and emerge from these times "better and stronger than ever."

Ninakat, when you consider whose economy, which economy, and the nature of the "economy" he is talking about, Bush is, once again, flaunting the truth in plain sight.
Or at least announcing their intentions openly.

[slow_dazzle]

maybe this was one of those "dead cat" bounces.

[kenoma]

Weak Dollar Costs U.S. Economy Its World No. 1 Spot

PARIS (Reuters) - The U.S. economy lost the title of "world's biggest" to the euro zone this week as the value of the dollar slumped in currency markets.

Taking the gross domestic product of both economies in 2007, the combined GDP of the 15 countries which use the euro overtook that of the United States when the European currency surged to a record high of more than $1.56 per euro.

"The curious outcome of breaching this latest milestone is that the size of the euro zone's annual output has now exceeded that of the U.S.," the economics department of Goldman Sachs, the Wall Street investment bank, said in a note to clients.

Taking official estimates of 2007 GDP -- $13,843,800 billion for the United States and 8,847,889.1 billion euros for the euro zone -- the economy of the latter passed the United States once converted into dollars, shortly after the euro topped $1.56.

The dollar sank to $1.5688 per euro late in European trading hours on Friday, at which rate the euro zone's 2007 GDP equates to $13,880,568.4 billion.

The 2007 GDP estimates are as published by the U.S. Commerce Department's Bureau of Economic Analysis and provided to Reuters on request for the euro zone by Eurostat, the European Union's statistics office.

http://www.nytimes.com/reuters/news/new ... ref=slogin

[between two lines]

Antiaristo i would like to ask you a question. i have read many of your writing throughout the years which you have posted on this website and i am intruigued about certain aspects of your argument. Lord jefferey archer in particular. As i live in england, the state of our economic instability and political corruption is at an abrupt point of disgrace at this presentt time. i am intrigued about your specific role within archers decline and why it is impossible to find anything on you within the case. i am not denying or faulting your words but find it almost surreal at points as to what i am reading. i wanted to know if you could shed some light on the fact for

[antiaristo]

.

My reply to btl can be found here:

http://rigorousintuition.ca/board/viewt ... 606#172606


ps thank you tal
(better late than never )

[slow_dazzle]

No wonder this story appeared in the weekend edition of The Times. Hopefully the rest of the UK press will pick it up on Monday.

He said that should the US Federal Reserve, the US Treasury and the Securities and Exchange Commission not devise a broad rescue plan to address the credit turmoil on Wall Street this weekend, “I would not be surprised to see an emergency bank holiday announced. That hasn’t happened since Roosevelt.” During the Depression, 75 years ago almost to the day, Franklin Roosevelt declared a four-day bank holiday, which stemmed a frantic run on banks. Mr Whalen added that should banks such as Lehman continue to be unable to sell the billions of dollars of mortgage-backed securities held, they were doomed. He said: “Broker dealers have to be able to get rid of assets. If they are illiquid, they die.”

Panic selling will trigger a chain reaction because the dodgy investments are insured. AFAIK any company that has to meet underwriting obligations will have to sell its assets to raise capital and those assets will be underwritten and they won't be worth their assumed values once marked to market. Chain reaction time. If an emergency bank holiday is declared the canary has landed on the floor.

[antiaristo]

.

Bear Sterns sold to JPM.

$2 per share

http://biz.yahoo.com/ap/080316/jpmorgan ... earns.html


The price seven days ago was above $60.

I read a lot of stories about insiders buying "extreme puts" last week. Those people have made a fortune.

The Treasury is being looted.

US$ BELOW 98 Yen

http://finance.yahoo.com/q?s=USDJPY=X


Massive ructions coming

[stoneonstone]

JPMorgan's acquisition of Bear Stearns represents roughly 1 percent of what the investment bank was worth just 16 days ago.

The deal marked a 93.3 percent discount to Bear Stearns' market c

Everybody should be rather nervous. I've never seen the suits so, well, unnerved.

I was just looking for early dateline stuff when our fine RI folk spotted this.