Friday, January 25, 2013
Inside China: War hysteria blamed on U.S.
Source: WT
War hysteria in China has not been this screechy since the 1970s.
The newly appointed supreme leader President Xi Jinping has completely revamped the command structure of the People’s Liberation Army and given the world’s largest military force a central mission: get ready for a war, quickly.
Much of China’s call to arms is related to Beijing’s increasingly unyielding stance on many of its territorial disputes with neighbors, and China has disputes with almost all of them.
Some of the more-tense discord is with China’s maritime neighbors, including Japan, the Philippines, South Korea, Taiwan and Vietnam.
As the clouds of war appear to be gathering ominously over China’s various territorial disputes, China has one arch enemy in mind: the United States.
The official communist newspaper, The Global Times, accused Washington of an “insidious strategic plot to make trouble for the Chinese-Japanese relations” in the conflict over the Diaoyudao islands, which Japan also claims and calls the Senkaku islands.
“Under the direct control by the United States, right-wing forces in Japanare using the dispute to challenge China’s sovereignty, and other countries such as the Philippines in the South China Sea region, are provoking us and acting ridiculously,” the newspaper said last week in an unusually harsh commentary stated.
“We must be clear that the United States never wants China to be strong. The U.S. is changing China from a peaceful competitor to aSoviet Union-like Cold War-era enemy.”
The article stopped short of calling for a direct war with the United States, but it warned that “China must be prepared for war; speed up economic and military preparations required of a military struggle; speed up our nuclear second-strike capabilities; and actively develop overseas strategic and military support bases.”
Last Friday, Secretary of State Hillary Rodham Clinton met with Japan’s Foreign Minister Fumio Kishida in Washington and reiterated the U.S. policy of neutrality in China’s territorial dispute with Japan.
“Although the United States does not take a position on the ultimate sovereignty of the islands, we acknowledge they are under the administration of Japan,” she said.
“We oppose any unilateral actions that would seek to undermineJapanese administration, and we urge all parties to take steps to prevent incidents and manage disagreements through peaceful means. … Our alliance with Japan remains the cornerstone of American engagement with the region.”
In response to Mrs. Clinton’s remarks, Chinese Foreign Ministry spokesman Qin Gang registered his government’s “strong dissatisfaction and resolute objection.”
“The United States bears a historical responsibility that it cannot deny over the Diaoyudao problem,” said the government spokesman, without elaborating.
“These statements [by Mrs. Clinton] are without factual support and without regard to the right and the wrong.”
Propaganda on the Internet
More than 540 million people currently use the Internet in China, but there are also millions of Internet-based “opinion-guiding” agents employed by the Chinese government to control and censor every single Internet forum and portal.
Secretly in the employment of the Chinese government, these censors officially are called “Internet commentators” but popularly known as the “50-Cents Party.” The nickname can be traced to October 2004 when the Hunan provincial Community Party Propaganda Department pioneered the system of paying 50 cents in Chinese yuan per posting to Internet agents hired specifically to write postings that seek to counter every piece the government dislikes.
Based on the Hunan model in 2007, then-Communist Party General Secretary Hu Jintao issued a directive in creating a massive “Internet commentator army” made up of “comrades who are ideologically resolute, skilled in Internet technology and familiar with the approach and language of the common Internet users.” The job of the agents is to “guide public opinions expressed on the Internet.”
Since then, these diligent 50-Cents Party members have proliferated by the millions at every Internet portal in China’s vast cyberspace, scanning and searching, incognito, for any “negative opinions” to counter. The postings are designs to appear as spontaneous, individual responses.
In reality, these 50-Cents Party members are under the control of Communist Party propaganda apparatus at all levels of government.
In Beijing alone, 1 in 10 residents in the capital city of 20 million are “propaganda workers,” according to the city’s vice mayor and municipal party propaganda chief Lu Wei, who spoke at a Propaganda Workers’ Conference on Jan. 17.
He disclosed that 60,000 professional “propaganda workers” are directly in the employed by the city government and more than 2 million informal collaborators work as the city’s propaganda team, most of them on university campuses and youth-oriented organizations that are most likely Internet-based.
At the conference, the Beijing propaganda chief ordered his propaganda army troops to master the Internet posting skills “in order to create positive energy” by posting Twitter-like messages exalting the Communist Party’s image and achievement, providing “opinion-guidance” on “hot topics” such as corruption, housing, and inequality.
Jim Rickards: Currency Wars Simulation
In this MUST WATCH video, Jim Rickards discusses ‘currency war games’ and how the in progress currency war between the US/West and China/Russia is likely to be played out. Not surprisingly, GOLD plays a pivotal role in the currency war games.
The end of the current fiat monetary system is coming, and a GOLD BACKED CURRENCY will replace the fiat petro-dollar.
Oldest Bank In The World Plunges, Halted As Chairman Resigns In Aftermath Of Latest Derivatives Fiasco
Source: Zero Hedge
Last week, following documentation from Deutsche Bank (and Nomura), it became clear that Italy's Monte Paschi (BMPS) bank (the oldest in the world) has engaged in derivatives with the German and Japanese banks in order to save itself during the financial crisis. The derivatives, according to Bloomberg, were done off-market and allowed the booking of large upfront gains which covered losses optically that the bank faced as European liquidity dried up completely - the offsetting 'losses' are now coming due. Today, amid growing outcry over the 'deal', the former head of BMPS has resigned. Bloomberg reports that Giuseppe Mussari, now Italy's top banking lobbyist, was the Chairman of BMPS during the derivative deal period. BMPS shares were halted after plunging dramatically as investors are still unclear of the extent of losses it faces on derivatives. If that was not enough chicanery, there is a twist in that none other than Mario Draghi, as Director of the Bank of Italy, would have had to vet Mussari (and his banks' regulated books) during this period - as BMPS accumulated what is obviously undocumented derivatives positions to intentionally obscure losses. Once again, years later, it seems the truth comes out - and of course we would expect no-one to go to jail - and the lying in Europe (then and now) continues unabated - as the reality of financial system health remains hidden from view.
Via Bloomberg,
Last week, following documentation from Deutsche Bank (and Nomura), it became clear that Italy's Monte Paschi (BMPS) bank (the oldest in the world) has engaged in derivatives with the German and Japanese banks in order to save itself during the financial crisis. The derivatives, according to Bloomberg, were done off-market and allowed the booking of large upfront gains which covered losses optically that the bank faced as European liquidity dried up completely - the offsetting 'losses' are now coming due. Today, amid growing outcry over the 'deal', the former head of BMPS has resigned. Bloomberg reports that Giuseppe Mussari, now Italy's top banking lobbyist, was the Chairman of BMPS during the derivative deal period. BMPS shares were halted after plunging dramatically as investors are still unclear of the extent of losses it faces on derivatives. If that was not enough chicanery, there is a twist in that none other than Mario Draghi, as Director of the Bank of Italy, would have had to vet Mussari (and his banks' regulated books) during this period - as BMPS accumulated what is obviously undocumented derivatives positions to intentionally obscure losses. Once again, years later, it seems the truth comes out - and of course we would expect no-one to go to jail - and the lying in Europe (then and now) continues unabated - as the reality of financial system health remains hidden from view.
Via Bloomberg,
Former Banca Monte dei Paschi di Siena SpA Chairman Giuseppe Mussari quit as Italy’s top banking lobbyist as scrutiny of the lender’s use of derivatives deepens.
The resignation is effective immediately, he said in a letter posted to the Italian Banking Association today. He leaves as Monte Paschi, where he was chairman from 2006 until April, comes under growing pressure to disclose the extent of losses it faces on derivatives.
The lender fell 5.7 percent to 27.75 cents in Milan trading today, the biggest decliner in Europe’s 46-member Stoxx 600 Banks Index, after Il Fatto Quotidiano reported Monte Paschi’s former managers signed contracts with Nomura Holdings Inc. (8604) three years ago that will reduce 2012 earnings by 220 million euros ($293 million). Nomura said in a statement Mussari “fully reviewed and approved” the trade.
“I always acted according to the law,” Mussari, 50, wrote. “I took the decision to not damage the association.”
Monte Paschi said on Jan. 17 it will review its accounts after Bloomberg News first reported that the lender engaged in a derivative with Deutsche Bank AG in 2008 that obscured losses before the Siena-based bank sought a government bailout. The Italian lender, which was bailed out in 2009, is seeking 500 million euros more from taxpayers, bringing the total cost of its rescue to 3.9 billion euros.
JP Morgan's Jamie Dimon Spurs Outrage in Davos
Remarks such as these, coming from the head of JPMorgan, are maddening'
Amid calls for stricter regulations of the banking industry, JP Morgan CEO Jamie Dimon came under fire Wednesday after telling
corporate and political leaders at the World Economic Forum that banks
had been wrongly "scapegoated" as the cause of the global economic
crisis, and resisted calls for increased regulation of the financial industry.
JP Morgan CEO Jamie Dimon. (Photograph: Karen Bleier / AFP / Getty Images) Dimon's
remarks on Wednesday—the first day of the WEF in Davos,
Switzerland—came in response to comments by Min Zhu, deputy managing
director of the IMF, who argued that the financial sector is too big and
greater regulations—including of the "shadow banking" sector—are
critical, The Guardian reports.
Sam Mamudi at Barrons writes, "This line of reasoning echoes that of Goldman Sachs CEO Lloyd Blankfein when he told the Times of London newspaper in late 2009 that his bank was 'doing God’s work.' It’s also nonsense, and it shows just how deeply inside their own bubble many bankers live these days."
Mamudi continues:
Zhu, of the IMF, told the panel at Davos that much more regulation must be implemented.
"Transparency is not there. In this sense, I say the financial sector still has a long way to go. With all the debates going on, the financial market structure didn't change very much," Zhu continued. "We're not safer yet."
JP Morgan CEO Jamie Dimon. (Photograph: Karen Bleier / AFP / Getty Images) Dimon's
remarks on Wednesday—the first day of the WEF in Davos,
Switzerland—came in response to comments by Min Zhu, deputy managing
director of the IMF, who argued that the financial sector is too big and
greater regulations—including of the "shadow banking" sector—are
critical, The Guardian reports.Sam Mamudi at Barrons writes, "This line of reasoning echoes that of Goldman Sachs CEO Lloyd Blankfein when he told the Times of London newspaper in late 2009 that his bank was 'doing God’s work.' It’s also nonsense, and it shows just how deeply inside their own bubble many bankers live these days."
Mamudi continues:
Lending to “schools, hospitals, governments” is good business for JPMorgan, and that’s why they do it — which is as it should be, but it’s no reason to celebrate. And giving money to organizations which in turn help the economy, and by extension society, grow is a bank’s basic function, as anyone who’s watched It’s a Wonderful Life will tell you."Remarks such as these, coming from the head of JPMorgan, are maddening," Jonathan Weil at Bloomberg writes. "Here he is saying all the right things and making all the right moves from a public-relations standpoint. Of course we should eliminate too-big-to-fail, most of us can agree. Of course we should ensure these monster institutions can fail without harming the public."
The fact that we’ve reached a point where these defenses are trotted out by some of finance’s most powerful men is ridiculous, because no one is arguing the opposite.
The criticisms, rather, are about pay structures and incentives that encourage reckless risk-taking, a system of too-big-to-fail that privatizes profit and socializes losses, and the fact that no-one at the biggest banks ever seems to be punished for malfeasance. Compare Dimon’s umbrage at mild criticism with PBS’ latest Frontline documentary, The Untouchables, about how pretty much the entire financial industry got away scot-free for its role in the mortgage meltdown.
Dimon came out of the 2008 financial meltdown with a better reputation than arguably any banker on the planet. But his attacks on proposed regulations — calling Basel III capital rules “anti-American” for example — and the London whale trading losses have stripped some of the sheen off his image. (As Felix Salmon notes there are still questions about Dimon’s role in that disaster, and still no full explanation of how the losses grew to more than $6 billion.)
His comments at Davos only go to further show that he’s just another Wall Streeter, convinced he’s doing nothing but good, and doing so mostly in the face of unfair and uninformed criticism. If even one of the ‘good guys’ of the banking industry sees the world in this way, then there really is nothing to do but start counting down to the next economy-shredding financial calamity.
Zhu, of the IMF, told the panel at Davos that much more regulation must be implemented.
"Transparency is not there. In this sense, I say the financial sector still has a long way to go. With all the debates going on, the financial market structure didn't change very much," Zhu continued. "We're not safer yet."
* * *
Watch the Full Clinton-Paul Exchange from the Benghazi Hearing
A potential preview of the 2016 Presidential election. Clinton vs. Paul. This is the full clip and includes Sen. Clinton's response.
"Had I been President, I would have relieved you of your post.'
Rand Paul earlier today:
"One of the things that disappointed me most about the original 9/11 is that no one was fired. We spent trillions of dollars, but there were a lot of human errors. These are judgment errors and the people who make judgment errors need to be replaced, fired, and no longer in the position of making these judgment calls.
I’m glad that you’re accepting responsibility. Ultimately, I think with your leaving, you accept culpability for the greatest tragedy since 9/11. I really mean that. Had I been president and found you did not read the cables from Benghazi and from Ambassador Stevens, I would have relieved you of your post. I think it's inexcusable. I think it’s good that you’re accepting responsibility, because no one else is."
Clinton responded, "I am the Secretary of State. And the [Accountability Review Board] made very clear that the level of responsibility for the failures that they outlined was set at the Assistant Secretary level and below."Paul went on to ask Clinton what she knew about possible shipments of weapons from Libya to Turkey and if the United States was involved. Clinton appeared perplexed by the question. She said that she had no knowledge of any weapons transfers from Libya to Turkey, let alone any U.S. involvement in such a transfer.
Some news outlets have suggested that arms are going from Libya to Syrian rebels through Turkey with American knowledge.
Sen. Chris Murphy (D-Conn.) rebuked Paul in the next exchange. "If some people on this committee want to call this tragedy the worst since 9/11, it misunderstands the nature of 4000 plus Americans lost in the War in Iraq under false pretenses."
---
Related Video: Clinton’s opening remarks on Benghazi
HSBC Buys $876 Million Worth of Silver
Silver has now rallied for 7 days due to the flood of inflows into
silver backed ETF’s and investment demand for coins and bars
internationally. Analysts polled by Reuters expect silver to rise in
2013.
Holdings of iShares Silver Trust, the world's largest silver ETF, stood at 10,689 tonnes on Jan. 22, up 604.9 tonnes, or nearly 6 percent, from the end of 2012.
By comparison, SPDR Gold Trust, the world's top gold ETF, saw an outflow of nearly 15 tonnes so far this year.
This has helped silver prices rally over 6% so far this year and 4.5% last week alone. The close above $32/oz yesterday was bullish technically and could lead to silver testing the next level of resistance which is at $34/oz.
The U.S. Mint has sold out of 2013 American Eagle silver coins and will resume sales the week of January 28 when the US Mint said inventory would be replenished.
Chinese silver turnover surged to 2,200 tonnes on Friday and analysts say Chinese investor’s interest in silver is continuing to rise as many are looking at silver as a cheaper alternative to gold.
Hence, trading volumes for the precious metal on the SGE soared in 2012.
Silver bullion imports by China remain robust too. Silver imports were 228 metric tons in December, according to data released by the customs agency.
There are also rumours that Apple is experiencing delays in producing the new iMac due to difficulty in sourcing industrial silver in volume in China. More silver than is typically used is utilised in the new 21.5" Apple iMacs.
HSBC Buying KGHM Silver Bars
HSBC has quietly moved into acquiring large amounts of silver bullion.
The bank has secured another deal to buy silver bars from KGHM which brings their total purchases of silver from KGHM alone in the last 12 months to $876 million or PLN 3.65 billion.
KGHM is one of the largest producers of silver in the world and is the second-largest producer of refined silver in the world.
They produce silver bars registered under the brand KGHM HG that are attested to by “Good Delivery” certificates issued by the London Bullion Market Association and the Dubai Multi Commodities Centre.
Listed metals producer KGHM signed an estimated PLN 1.67 billion deal on 2013 sales of silver to HSBC, KGHM said in a market filing yesterday.
The deal puts the total value of deals between KGHM and HSBC in the last 12 months to PLN 3.65 billion or $876 million, the filing read.
The Management Board of KGHM announced that on 21 January 2013 a contract was entered into between KGHM and HSBC Bank USA N.A., London Branch for silver sales in 2013.
The estimated value of the contract is PLN 1,672,260,469.66. As a result of entering into this contract, the total estimated value of contracts entered into between KGHM and HSBC Bank USA N.A., London Branch over the last 12 months exceeded 10% of the equity of the Company and amounts to PLN 3,654,120,061.59.
The highest-value contract signed during this period is the above-mentioned contract. The criteria used for describing the contract as significant is that the total estimated value of the contracts exceeds 10% of the equity of KGHM.
KGHM is one of the largest companies in Poland and one of the largest mining & metallurgy companies in the world.
The main customers of Polish silver in recent years have been the United Kingdom, Germany and Belgium. HSBC appears to be one of their main customers now.
Respected and erudite, James Steel, the chief commodity analyst at HSBC Securities (USA) Inc. continues to be bullish on silver and recently said how “silver tends to track gold, except it over performs in a bull market” and how he was “moderately bullish on silver” in 2013.
HSBC did not comment on the deal and it only came to light as KGHM is a listed company and had to report the deal which was then picked up in Polish media.
The massive deal could simply be HSBC securing supply for the NYSE listed ETFS Physical Silver as they are the custodian.
Or it could be that senior people in HSBC are concerned about securing supply as they expect robust investment demand to continue and possibly increase resulting in higher prices.
*Post courtesy of Mark O'Byrne at Gold Core.
Holdings of iShares Silver Trust, the world's largest silver ETF, stood at 10,689 tonnes on Jan. 22, up 604.9 tonnes, or nearly 6 percent, from the end of 2012.
By comparison, SPDR Gold Trust, the world's top gold ETF, saw an outflow of nearly 15 tonnes so far this year.
This has helped silver prices rally over 6% so far this year and 4.5% last week alone. The close above $32/oz yesterday was bullish technically and could lead to silver testing the next level of resistance which is at $34/oz.
The U.S. Mint has sold out of 2013 American Eagle silver coins and will resume sales the week of January 28 when the US Mint said inventory would be replenished.
Chinese silver turnover surged to 2,200 tonnes on Friday and analysts say Chinese investor’s interest in silver is continuing to rise as many are looking at silver as a cheaper alternative to gold.
Hence, trading volumes for the precious metal on the SGE soared in 2012.
Silver bullion imports by China remain robust too. Silver imports were 228 metric tons in December, according to data released by the customs agency.
There are also rumours that Apple is experiencing delays in producing the new iMac due to difficulty in sourcing industrial silver in volume in China. More silver than is typically used is utilised in the new 21.5" Apple iMacs.
HSBC Buying KGHM Silver Bars
HSBC has quietly moved into acquiring large amounts of silver bullion.
The bank has secured another deal to buy silver bars from KGHM which brings their total purchases of silver from KGHM alone in the last 12 months to $876 million or PLN 3.65 billion.
KGHM is one of the largest producers of silver in the world and is the second-largest producer of refined silver in the world.
They produce silver bars registered under the brand KGHM HG that are attested to by “Good Delivery” certificates issued by the London Bullion Market Association and the Dubai Multi Commodities Centre.
Listed metals producer KGHM signed an estimated PLN 1.67 billion deal on 2013 sales of silver to HSBC, KGHM said in a market filing yesterday.
The deal puts the total value of deals between KGHM and HSBC in the last 12 months to PLN 3.65 billion or $876 million, the filing read.
The Management Board of KGHM announced that on 21 January 2013 a contract was entered into between KGHM and HSBC Bank USA N.A., London Branch for silver sales in 2013.
The estimated value of the contract is PLN 1,672,260,469.66. As a result of entering into this contract, the total estimated value of contracts entered into between KGHM and HSBC Bank USA N.A., London Branch over the last 12 months exceeded 10% of the equity of the Company and amounts to PLN 3,654,120,061.59.
The highest-value contract signed during this period is the above-mentioned contract. The criteria used for describing the contract as significant is that the total estimated value of the contracts exceeds 10% of the equity of KGHM.
KGHM is one of the largest companies in Poland and one of the largest mining & metallurgy companies in the world.
The main customers of Polish silver in recent years have been the United Kingdom, Germany and Belgium. HSBC appears to be one of their main customers now.
Respected and erudite, James Steel, the chief commodity analyst at HSBC Securities (USA) Inc. continues to be bullish on silver and recently said how “silver tends to track gold, except it over performs in a bull market” and how he was “moderately bullish on silver” in 2013.
HSBC did not comment on the deal and it only came to light as KGHM is a listed company and had to report the deal which was then picked up in Polish media.
The massive deal could simply be HSBC securing supply for the NYSE listed ETFS Physical Silver as they are the custodian.
Or it could be that senior people in HSBC are concerned about securing supply as they expect robust investment demand to continue and possibly increase resulting in higher prices.
*Post courtesy of Mark O'Byrne at Gold Core.
Royal Canadian Mint starts rationing silver coins
Dear Friend of GATA and Gold:
Jason Hamlin of Gold Stock Bull reports that, following the U.S. Mint, the Royal Canadian Mint has begun rationing its silver coin production:
http://www.goldstockbull.com/articles/royal-canadian-mint-hits-supply-sh...
It's not that silver isn't available. It seems to be that the mints don't want to buy the metal necessary to meet coin demand, lest they allow the price of silver to be pushed up to jeopardize the government-backstopped price suppression scheme.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
In addition to its precious metals storage facilities in Hong Kong, Switzerland, Toronto, and the United Kingdom, now with GoldMoney you can store gold and silver in Singapore in a high-security vault operated by Brink's Singapore Pte Limited. To celebrate the launch of this storage option, GoldMoney is offering a discount on buy and exchange fees at this vault for any orders above US$10,000 (or the equivalent) until January 31, 2013. The gold buy rate is 0.98%, while the silver rate is 1.99%. Metal exchanges into Brink's Singapore will also be discounted for this period and will be charged at 0.78% for gold and 1.75% for silver. Simply place your order online and the above rates apply automatically until January 31, 2013, 15.00 UK time. To find out more about the new vault, please visit:
http://www.goldmoney.com/singapore?gmrefcode=gata
GoldMoney customers can take delivery of any number of gold, silver, platinum, and palladium bars from any GoldMoney vault, as well as personally collect their bars stored in the Hong Kong, Switzerland, and U.K. vaults.
It's easy to open an account, add funds, and liquidate your investment. For more information, visit:
http://www.goldmoney.com/?gmrefcode=gata
Jason Hamlin of Gold Stock Bull reports that, following the U.S. Mint, the Royal Canadian Mint has begun rationing its silver coin production:
http://www.goldstockbull.com/articles/royal-canadian-mint-hits-supply-sh...
It's not that silver isn't available. It seems to be that the mints don't want to buy the metal necessary to meet coin demand, lest they allow the price of silver to be pushed up to jeopardize the government-backstopped price suppression scheme.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
In addition to its precious metals storage facilities in Hong Kong, Switzerland, Toronto, and the United Kingdom, now with GoldMoney you can store gold and silver in Singapore in a high-security vault operated by Brink's Singapore Pte Limited. To celebrate the launch of this storage option, GoldMoney is offering a discount on buy and exchange fees at this vault for any orders above US$10,000 (or the equivalent) until January 31, 2013. The gold buy rate is 0.98%, while the silver rate is 1.99%. Metal exchanges into Brink's Singapore will also be discounted for this period and will be charged at 0.78% for gold and 1.75% for silver. Simply place your order online and the above rates apply automatically until January 31, 2013, 15.00 UK time. To find out more about the new vault, please visit:
http://www.goldmoney.com/singapore?gmrefcode=gata
GoldMoney customers can take delivery of any number of gold, silver, platinum, and palladium bars from any GoldMoney vault, as well as personally collect their bars stored in the Hong Kong, Switzerland, and U.K. vaults.
It's easy to open an account, add funds, and liquidate your investment. For more information, visit:
http://www.goldmoney.com/?gmrefcode=gata
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