Daily Digest

Daily Digest 1/31 - The Despicable MF Global, Entering The Debt Dimension, Rare Earth Shortage Could Threaten Innovation

Tuesday, January 31, 2012, 10:36 AM
  • 3 Months After The MF Global Bankruptcy, We Find That $1.2 Billion (Or More) In Client Money Has "Vaporized"
  • Exposing Silver Mythology – Part III
  • MF Global - A Despicable State Of Affairs
  • MF Global 4-1-9
  • Entering The Debt Dimension
  • Countrywide Protected Fraudsters By Silencing Whistleblowers, Say Former Employees
  • In 2011, Global Spending on Renewable Energy Rose 40 Percent
  • Has Petroleum Production Peaked, Ending the Era of Easy Oil?
  • Shortage of Rare Metals Could Threaten High-Tech Innovation
  • Is a Reduction in Population Numbers the only Sustainable Solution?

Our 'What Should I Do?' guide has steps to cook, see & stay warm in times of power outage


3 Months After The MF Global Bankruptcy, We Find That $1.2 Billion (Or More) In Client Money Has "Vaporized" (June C.)

Many officials now believe certain employees at MF Global dipped into the "customer segregated account" that the New York company was supposed to keep separate from its own assets—and then used the money to meet demands for more collateral or to unfreeze assets at banks and other counterparties as they grew more concerned about their financial exposure to MF Global.

Investigators also are examining other scenarios that have gained traction in recent weeks, such as the possibility that MF Global suffered steep losses on investments made using customer money. Officials investigating the case have looked into whether such investments were appropriate under rules at the time.

Exposing Silver Mythology – Part III (David B.)

Well, we know what the silver-hater who wrote this piece thinks about the silver market. What we don’t know is what planet he is writing about, because it obviously has nothing to do with the planet Earth. The near-total depletion of inventories, and the imminent default-event which that portends, suggest nothing other than that the upward move in the price of silver has just begun.

MF Global - A Despicable State Of Affairs (adam)

What the press apparently has not yet heard or is not reporting is that vulture funds are now contacting the MF Global customers, however they may have obtained their names, and are offering them 85 cents on the dollar for their claims. Most of the claim holders are reported to expect or to have been payed 72 cents on the dollar as things now stand. The Wall Street Journal certainly casts gloom on their prospects for a full recovery and hopes of justice, based on the report from an unnamed source.

MF Global 4-1-9 (Chris M.)

I am Dr. Bakare Tunde Obama III, the cousin of Nigerian Astronaut, Barrister Jon Corzine. He was the first African commodities broker in space when he made a secret flight to the Salyut 6 space station in 1979. He was on a later Soviet spaceflight, Soyuz T-16Z to the secret Soviet military space station Salyut 8T in 1989. He was stranded there in 1990 when the Soviet Union was dissolved. His other Soviet crew members returned to earth on the Soyuz T-16Z, but his place was taken up by return cargo destinated to the good offices of JP Morgan & Co. There have been occasional Progrez supply flights to keep him going since that time.

He is in good humor, but wants to come home.

Entering The Debt Dimension (Ilene)

In Jesse's view, and we agree, the “yawning gap between productive labor and mere money manipulation” needs to be closed, and hard choices are required to resolve the unsustainable concentration of both power and risk.

Countrywide Protected Fraudsters By Silencing Whistleblowers, Say Former Employees (Chris M.)

By intercepting the documents before they were sliced by the shredder, the investigators were able to uncover what they believed was evidence that branch employees had used scissors, tape and Wite-Out to create fake bank statements, inflated property appraisals and other phony paperwork. Inside the heaps of paper, for example, they found mock-ups that indicated to investigators that workers had, as a matter of routine, literally cut and pasted the address for one home onto an appraisal for a completely different piece of property.


In 2011, Global Spending on Renewable Energy Rose 40 Percent (James S.)

Fukushima’s hammer-on effect not only blindsided Japan’s traditional reliance on nuclear power but Germany as well, which saw German Chancellor Angela Merkel announce on 30 May 2011 that Germany, the world's fourth-largest economy and Europe's biggest, would shutter all of its 17 nuclear power plants between 2015 and 2022. Indicating the depth of the German commitment to seek alternative sources of power, Germany's Kreditanstalt fur Wiederaufbau (German Development Bank) announced its intention to underwrite renewable energy and energy efficiency investments in Germany with $137.3 billion over the next five years,

As the battle heats up between a petroleum-natural gas behemoth seeking to quash its renewable upstart, the issue will devolve down to two issues – cash and access.

Has Petroleum Production Peaked, Ending the Era of Easy Oil? (estatesavr)

To support our modern lifestyles—from cars to plastics—the world has used more than one trillion barrels of oil to date. Another trillion lie underground, waiting to be tapped. But given the locations of the remaining oil, getting the next trillion is likely to cost a lot more than the previous trillion. The "supply of cheap oil has plateaued," argues chemist David King, director of the Smith School of Enterprise and the Environment at the University of Oxford and former chief scientific adviser to the U.K. government. "The global economy is severely knocked by oil prices of $100 per barrel or more, creating economic downturn and preventing economic recovery."


Shortage of Rare Metals Could Threaten High-Tech Innovation (Jeff B.)

"With respect to metals that are hitchhikers, a higher price isn't going to lead to much more production," said Robert Ayres, a physicist and economist based at the international business school INSEAD in France. "And therefore it's much more important to think in terms of conservation, recycling and substitution."

Is a Reduction in Population Numbers the only Sustainable Solution? (James S.)

Globalization sows the seeds of its own demise because factory workers are effectively forced to compete for wages with workers from around the world. Workers in the Global South can get along with lower wages for a number of reasons, including the fact that they tend to live in warmer areas, so do not need to build as sturdy homes and have less need to heat them. With fewer jobs and less investment in the Global North, demand falls and debt defaults become more of a problem.

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."


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JIm Sinclair's hair is on fire

I haven't noticed this posted elsewhere on CM, so if it is, I apologize for being redundant.  It's an interview with Jim Sinclair and subsequent discussion on tfmetalsreport.com/blog.  It's too long for me to summarize, but worth a listen.



by Jim Sinclair
My Dear Friends,
I was interviewed today concerning the most powerful body in the financial world that now holds in its hands the near future of all markets, from currencies to commodities, based on a single edict to be given.
The interview is being processed and should be posted here later this evening.
This organization supersedes all governments and central banks today in terms of the financial power they edict. This organization can have a greater impact on your pocketbook than the FASB did when they killed "true value" accounting.
This body is made up of the key players of the five largest banks in the USA and other countries. This body by their actions this week will guarantee QE to infinity.
This is relevant to all your assets, yes all. If you have the time listen to it please. If you don’t have the time listen to it please. If you don’t listen to it do not blame me when all hell breaks loose six months from now.
Not one word about this body was on the airwaves today, yet this group by a simple decision rules the financial plant. They will be making this edict in just a few days. They have to do it again this year. It is then that you know what will hit the fan.
I feel this is it for jsmineset.com tonight. I do not want to write another word and detract from the revelations you will hear.
Your financial future, even if you have never heard of them, is in this organization’s hands. Check in later for the interview. If you don’t check in your finances might just check out.
Please remember you have been informed of this impending edict as a service to the community.


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MF Global's vaporized $

I emailed that ZH story about MF Global's 'missing' $ to a friend that actually used to work at MF, he said he was trying not to think about that kind of stuff, it made him pretty mad.  I replied:

If you still get mad at this that means you're just not reading enough about it; after a while you just go comfortably numb :)  To quote Mr. Durden from the article: "It is becoming increasingly difficult to even care anymore...nobody will be held accountable" 

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China and UAE ditch US Dollar, will use Yuan for oil trade


China and UAE ditch US Dollar, will use Yuan for oil trade

24 Jan 2012

NEW YORK (Commodity Online): The US dollar is fast losing out its reserve currency status with China aggressively replacing the dollar with the Yuan as a currency for bi-lateral trade. The latest is an agreement signed between the China and the United Arab Emirates (UAE), which will use the Yuan for oil trade.

The deal is worth around $5.5 billion dollars and the Chinese central bank said that the deal aims at “strengthening bilateral financial cooperation, promoting trade and investments and jointly safeguarding regional financial stabilityâ€

Earlier, Russia and Iran had decided to use Rubles as a means of currency. With both China and Russia converting their bi-lateral trades into non-US dollar deals, the greenback is now under threat of losing out its status as the world reserve currency. And the impact of such a transition will essentially tip the balance of global power.

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Food zones for farmers in danger


Food zones for farmers in danger of coming a cropper

January 31, 2012

A KEY election pledge by the state government to fence prime farmland off from mining interests is in danger of collapse, with the minerals and gas industries refusing to concede that any part of the state is off limits.

Confidential documents leaked from within the negotiation process show that the farming, resources and environmental groups that are developing the policy for ''food security'' zones are locked in stalemate.

The peak coal seam gas body, the Australian Petroleum Production and Exploration Association, wrote to the government last month saying it did ''not support blanket 'no go' areas, as such an approach is subjective and is not based on justifiable evidence, scientific assessment of agricultural and conservation values, and nor does it have regard to economic considerations''.

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Welcome to "Temp Employee Nation"


A new casino set to open in Atlantic City, N.J., has announced it will set term limits for its front-line staff. When employees' terms run out, they'll have to go through the hiring process again. The casino says the policy will keep its service fresh. Others say the company is taking advantage of a tough job market.

From bellhops to dealers, employees of the new casino — called Revel — will be hired for terms from four to six years. After that, they have to reapply for their jobs and compete against other candidates.

Revel declined to make anyone available for an interview. In a written statement, the company asserts that its employment policy will help it "attract the most highly professional people who are inspired by a highly competitive work environment."

But it's an unusual way to go. Many who work in employment law or advocacy say they've never heard of anything like this before.



With about a half-decade of a blah economy and weak employment, Americans are growing more amenable to taking temporary employment, changing their viewpoint from the glass-half-empty opinion of "it's a job without permanence" to "it's a job that may lead to something permanent one day."

This is according to the latest Workplace Insights Survey from the folks at Adecco, which found that 63% of Americans now look at temp jobs more positively than they did last year, while 86% believe that a temp gig is a viable option for someone who wants to gain work experience.

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is the petrodollar toast?

For anyone wondering how the abandonment of the dollar reserve status would look like....

....a whole series of bilateral agreements that quietly seeks to remove the US currency as an intermediate.

[link to www.zerohedge.com]

The list of countries dumping the dollar in bilateral trade:
Hong Kong
South Korea



Yuan begins trading against the rouble
[link to www.chinadaily.com.cn]

China, Japan to Back Direct Trade of Currencies

[link to www.bloomberg.com]

India Joins Asian Dollar Exclusion Zone, Will Transact With Iran In Rupees
[link to www.zerohedge.com]

Iran, Russia Replace Dollar With Rial, Ruble in Trade, Fars Says
[link to www.bloomberg.com]

India and Japan sign new $15bn currency swap agreement
[link to www.bbc.co.uk]

China and UAE ditch US Dollar, will use Yuan for oil trade
[link to www.commodityonline.com]

Brazil-China bilateral trade in Real and Yuan instead of US dollar
[link to en.mercopress.com]

RI, China considering shift to rupiah, yuan for settling trade
[link to www.thejakartapost.com]

China positions Yuan as new “reserve currency”
[link to bullionbullscanada.com]

The Rise of the Chinese Yuan
[link to www.southerntimesafrica.com]

Turkey and China to Shun the Dollar
[link to online.wsj.com]

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