Planetary financial crisis next week around Oct 7?

[Merlyn]

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Jim Sinclair has the following posted on his website today and
I wonder if it relates to the October 7th - webot -Half Past Human.

(note: the LIBOR rate has to do with inter Bank loan rates.)

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Posted On: Thursday, October 02, 2008, 10:35:00 AM EST

A Modern Day Weimar
Author: Jim Sinclair

Dear Extend Family,

Unless the LIBOR rate drops sharply we are facing a planetary financial crisis next week.

For God's sake protect yourself.

Gold and gold related items will be the only true storehouses of wealth. The bailout bill is powerless to reverse what is now happening.

This is a modern day Weimar happening right before our eyes.

Respectfully yours,
Jim

[Rocky_Shorz]

hmmmm, the same day US Military is rumored to go to Defcon 1 for a terrorist attack...

[Merlyn]

The following message has been going around the Internet as well.
Use your own discernment.

“Reliable word that Bank of America branch managers just received a letter or memo from the USFed instructing them to perhaps be ready for a one-week universal shut-down of the banking system , including access to checking accounts, savings accounts and credit cards. Reliable word has it that BofA bank branches received a shipment of signs last week, reading “WE'RE SORRY, BUT DUE TO CIRCUMSTANCES BEYOND OUR CONTROL, WE CANNOT BE OPEN AT THIS TIME.”

[Merlyn]

Jim has also posted this today:

Posted On: Thursday, October 02, 2008, 12:09:00 PM EST
Protecting Your Financial Self - An Addition
Author: Jim Sinclair

Dear CIGAs,

I have no doubt that $1650 will come. My concern is not that it will not happen, but that I am much too conservative in my long-term price objective since 2000.

If major banks can be torn apart how can we have faith in the small local institutions that hold most of your ready cash?

When I said �This is IT,� it is not something that I take lightly. Never in 49 years in finance have I seen a set of circumstances so challenging to the man in the street.

What I am getting at is a simple question. Are you prepared? You have heard us talk repeatedly on removing financial intermediaries between you and your assets, but the time has come for us to recommend going one step further:

Hold enough cash at your household to last you a month or two. It may be largely unnecessary for the majority, but what do you have to lose? If your bank should fail this will save you a lot of grief in the short term. If they do not, you still have all your cash that can easily be deposited back into your account.

Regards,
Jim

[Truther21]

I dont know what you guys thing about this, but... yesterday I saw a license plate and it said ocv-708... Dont know what the v means but thats the date that instantly popped into my head......Hmmmm oct-708

[pineal-pilot-in merkabah]

i think global meltdown yes... terror, war , haarpiquake at the saem time.. take your pic of the 3

[Merlyn]

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Notice in the article below it talks about the LIBOR inter bank lending that Jim Sinclair mentions in the post above.

Article from: http://www.theaustralian.news.com.au...014020,00.html

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US government rescue may prove too feeble
Scott Murdoch | October 04, 2008

GLOBAL equities markets are stuck in a rut and there seems little to prompt a reversal in the savage sentiment towards stocks.

The US government rescue package is weak and instead of providing the momentum expected, it seems to be failing.

The response to the $US700 billion ($895 billion) plan shows the fragile state of the markets and that they are prone to over-reaction.

It is easy to chart the financial market's performance through equities and for most investors that is where the importance lies.

But the market carnage extends deep beyond global share markets, with the problems rooted in money and credit markets. As the second leg of the credit crunch appears to be worse than the first, which took the world by storm last year, credit markets are in disrepair.

Macquarie's senior debt is about twice as expensive as it was this time last year and across the board corporate debt has become relatively unattractive to hold.

The credit default swaps are at 697 for the senior debt and 997 for the subordinated tranche.

Before the credit crunch, the senior was priced at 200 and the sub-debt at 400, showing the rates have more than doubled.

In comparison, the major diversified financials are trading at around the 200 mark, showing many in the market are unsure how Macquarie will perform in the near term.

"The Macquarie halo has slipped," a debt trader says. "Not only is it now regarded as just another investment bank, the refusal to give a clear picture of gearing and capital means it will trade at a discount in this market," he says.

But the upshot of this ruction has flowed through to the money markets and while fear grips them, banks are choosing to hoard cash on their balance sheets. Instead of lending it out and financing corporate activity, global banks consider it safer and indeed more logical to hold the money.

This is where the real problems lie: if there is no liquidity and therefore no lending, the effects on the real economy are at risk of being worse than first thought.

At present, the corporate money-raising pipeline is virtually shut and business is being forced to return to the traditional banks for financing.

But around the world, most of those banks are struggling to gain new funding. In Australia, banks have been relatively active in ensuring their capital needs remain well funded.

This week, ANZ completed a $1.03 billion convertible preference share issue that was seized on by institutional investors.

Similarly, Westpac raised $1.48 billion in a domestic bond issue in two tranches. The first part was an $830 million piece of its September 2010 fixed and floating rate, which was bolstered with a further raising of $650 million.

The deal effectively priced both tranches 75 basis points above the swap rate.

The effect of the crunch is being emphasised in the money markets.

In Australia, the funding spread the banks rely on mostly is the difference between the 90-day bank bill rate and the Overnight Index Swap.

That stands at a spread of 65 basis points, almost triple the points it was at when the Reserve Bank of Australia met in September and reduced the official cash rate by 25 basis points.

A widening by that much surely supports the case for the RBA to cut the rate by 50 basis points when it meets on Tuesday.

In the international credit markets, the fear has proved too strong and pushed interbank lending rates up to all-time highs.

The three-month Libor rate is up to 4.21 per cent, which has in turn pushed Libor-OIS spreads to 260 basis points and the TED Spread (the spread between Libor and 90-day Treasuries) is at 360 basis points.

These all indicate that money market rates are through the roof and even with the rescue package expected to be approved by the US House of Representatives, calm will not necessarily result.

"We are again heading into another, no doubt, historic weekend with the US Government in crisis, financial markets convulsing, and corporates gasping for finance," BNP Paribas credit analyst Brett Williams says.

"Stir in some foul US jobs data, and you set in train negative momentum that could overwhelm any government or regulatory help."

There have been some problems identified with the US emergency bailout package, the least being its sheer size.

On the surface, $US700 billion is headline grabbing because it is a big number, but compared with the $US10 trillion mortgage market, it is a mere helping hand.

There are also worries that the legislation has been made too transparent in order for it to progress through Congress. The favouring of a "reverse auction" process means a bid spread will be lodged, and when price discovery is made, the banks could be forced to write down further assets on their books.

The reaction of all asset markets indicates the bailout will not prove as effective as first thought.

There was the expectation the package was the legislative reform that would prove fundamental because, for once, it was not just an injection of cash.

But as the "announcement value" is depleted, the effect of the package is weakening.

"This is turning into a tragedy," one bank boss says.

There is no guarantee any potential relief rally will be sustainable or that the financial system's shakes will be soothed after the policy makers cast their final votes.

[Merlyn]

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Another article about what Jim Sinclair is warnig regarding the LIBOR rate


Libor Rises, Commercial Paper Slumps as Credit Freeze Deepens

By Bryan Keogh

Oct. 2 (Bloomberg) -- Interest rates on three-month dollar loans rose to a nine-month high, short-term corporate borrowing fell by the most ever and leveraged loans tumbled, exacerbating the credit freeze that's paralyzing businesses around the world.

The London interbank offered rate that banks charge each other for loans rose for a fourth day, driving a gauge of cash scarcity among banks to a record. The biggest drop in financial short-term debt outstanding since at least 2000 caused the U.S. commercial paper market to tumble 5.6 percent to a three-year low, according to the Federal Reserve.

The crisis deepened after the worst month for corporate credit on record. Leveraged loan prices plunged to all-time lows, short-term debt markets seized up and even the safest company bonds suffered the worst losses in at least two decades as investors flocked to Treasuries. Credit markets have frozen and money-market rates keep rising even after central banks pumped an unprecedented $1 trillion into the financial system.

Rest of article at: http://www.bloomberg.com/apps/news?p...71Y&refer=home

[Merlyn]

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Jim Sinclair has posted this at his site:


Posted On: Friday, October 03, 2008, 8:06:00 PM EST
In The News Today
Author: Jim Sinclair

Thought for the weekend:

The entire financial world hangs by the LIBOR rate. It better drop Monday morning and stay down or it has all hit the fan.


LINK: http://www.jsmineset.com/


See also this link that mentions 54,000 billion credit derivatives and Oct 6

Settlement day approaches for derivatives
http://www.ft.com/cms/s/0/6beabcdc-8...0779fd18c.html

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[Noela]

I have spent the morning reading "The Guardian" U.K. (4 October). Here are a few snippets -
"Gordon Brown yesterday created a new 19-strong national economic council as he effectively put the government on an econimic war footing. 'the new problems have completely changed, so it is not just what the Treasury does, but also energy, food and housing'
the prime minister said.

"EU commissioner (Peter Mandelson) returns to government as crisis rquires 'all hands to pump'.
Mandelson ....was only asked to return to the cabinet on Thusday." (Other changes to the cabinet include Hilary Benn as Minister for a "new food department")

"Amid fresh signs that the economy is on the brink of recession, the Financial Services Authority said it would increase the security on deposits from £35,000 with effect from TUESDAY (my caps)...."

Heading of article by Nils Pratley - "When the Bank is buying car loans, you know this is a crisis". He continues "We swap US student loans for cash for three months. No, this is not an offer from a Bayswater money-changer. It comes directly from the Bank of England, which is now accepting some eye-catching forms of collateral. Car loans and equipment leases also make the grade........

" (The Bank of England) last week ..provided £40bn to the banks. On TUESDAY, (my caps.) it will offer another £40bn against the wider pool of collateral. Then it will hold another six weekly auctions of undetermined size. Then there is $70bn lent in overnight, six-day and one-week operations. Add it all up and it seems that the Bank has essentially replaced the gummed-up wholesale funding market. It is the only guy in town prepared to lend.

........"There is an understandable tendency to think that the Bank, when it makes big interventions in the money markets, knows that a piece of bad news is coming down the slipway."

Noela

[tandiwe]

Just for info. Have just watched the BBC 9.40 pm news report in the elections in the US and the presenter actually mentioned an "October surprise"!!!! As something that would change the course of the election. Did anyone else see this?

xt

[Powerinourhandsl]

Oh sugar!!

Listern to the latest , seems all will hit th efan on Tuesday
http://www.projectavalon.net/forum/s...ead.php?t=4166

[Jenny]

As I understand what Deagle talked about was; The string of events will be unleashed on october 7th.
What that entailes is unclear.

Jenny

[Carol]

Urgent we need your help now with spiritual intevention...
Please listen to Bill Deagle's interview.

It is about the blood sacrifice of America.

http://projectavalon.net/bill_deagle_4_oct_2008.mp3

Hi, I'm new to the FPA. I'm totally deaf (severe hearing losses in both ears since I was a tyke) and I would like to know what Bill Deagle was saying from the unedited audio file, if you please provide what he's saying in a summary?

Thanks.

[houman]

AIG subsidiary parties in style in OC, two weeks after bailout
http://taxdollars.freedomblogging.co...ef=patrick.net


The giant sucking sound
http://3.bp.blogspot.com/_nSTO-vZpSg...ng%20Sound.png

[Merlyn]

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I am not sure I agree with all of what Bill Deagle said in this Oct 4 phone call.
One thing he said was that the Bank problems would start in Europe and
Jim Sinclair posted the below message and note Jim states "Dear International
Friends" that suggests the problem may start overseas but Jim has also
suggested that people in USA get some cash on hand. I think Jim's advice is
good and not fear based but just practical.

Posted On: Saturday, October 04, 2008, 2:37:00 AM EST
Thoughts For The Weekend
Author: Jim Sinclair

Dear International Friends,

Maybe you should consider a visit to your local bank for their abbreviated Saturday hours.. What do you have to lose? That all depends on how much you have deposited there...

I have no doubt that $1650 will come. My concern is not that it will not happen, but that I am much too conservative in my long-term price objective held since 2000.

If major banks can be torn apart how can we have faith in the small local institutions that hold most of your ready cash?

When I said "This is IT," it is not something that I take lightly. Never in 49 years in finance have I seen a set of circumstances so challenging to the man in the street.

What I am getting at is a simple question. Are you prepared? You have heard us talk repeatedly on removing financial intermediaries between you and your assets, but the time has come for us to recommend going one step further:

Hold enough cash at your household to last you a month or two. It may be largely unnecessary for the majority, but what do you have to lose? If your bank should fail this will save you a lot of grief in the short term. If they do not, you still have all your cash that can easily be deposited back into your account.

Regards,
Jim

From: http://www.jsmineset.com/

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[Carol]

Originally Posted by Rundeaf

Hi, I'm new to the FPA. I'm totally deaf (severe hearing losses in both ears since I was a tyke) and I would like to know what Bill Deagle was saying from the unedited audio file, if you please provide what he's saying in a summary?

Thanks.

I think the transcription has been completed and will be uploaded by Sunday.

[peaceandlove]

Article posted October 2, 2008 at the Charlotte Observer Website:

Wachovia faced a 'silent' bank run
Fearing a loss of funding over the weekend, the FDIC forced the sale.
http://www.charlotteobserver.com/bus...ry/226799.html

Obviously there is not enough money to cover the deposits probably in any of the banks and if everyone withdraws their funds there will definitely be a crash. Oh, the dangers of counterfeiting money. endthefed.us

As the banks go down and mergers increase we are fueling the NWO with their control of the central banking system.

With Peace and Love in Mind, :wub2:

[Merlyn]

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The danger to the Banks is not just a run on them by individual depositors but
the LIBOR rate (interbank loan) that they need to keep operations going. The Banks do not trust each other and are holding money back this is why the FED and central banks are pumpimg money into the system.

Yes everyone going to get their money out might be even more problem and if
this goes into hyperinflation holding your money anywhere at bank or at home will be a bad idea.

The FDIC can only insure a small percentage of the deposits right now their fund is around $40 billion and Washington Mutual alone had $188 million in deposits. So the FDIC could not back up Washington Mutual's failure. If only 10% (maybe even less today) of a fractional reserve Bank deposits are taken that Bank will probably fail.

Jim Sinclair is not saying take all of your money out just enough to last a couple months and then you can put it back in your bank if everything is okay.

But if you start to see hyperinflation start then consider converting money
into property, gold, silver, food, etc... again do not fear or panic ... keep a calm and cool head but do your planning and prepare.

It is already happening in Iceland see thread:
http://projectavalon.net/forum/showthread.php?t=4205

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[pineal-pilot-in merkabah]

if you have been broke and homeless for a year will it make a difference.. i think we still need to prepare.. im homeless and was broke/soon to be broke again lol

Thank you, Carol.

[Merlyn]

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Have you followed Jim Sinclair's advice above?

Hold enough cash at your household to last you a month or two. It may be largely unnecessary for the majority, but what do you have to lose? If your bank should fail this will save you a lot of grief in the short term. If they do not, you still have all your cash that can easily be deposited back into your account.

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[tommy38]

From todays (Oct 6, 2008) London Telegraph
Quote – We face extreme danger…we risk a disintegration of global finance within days.
http://www.telegraph.co.uk/finance/c...the-abyss.html

Well, well…….

[Merlyn]

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Europeans and everyone is trying to shore up their Banks.

If depositors start to get nervous they may pull some. most. or all of their
money. FRactional reserve Banks only required to have 10% to cover so if more than that is withdrawn the Bank is gone. The FDIC cannot cover more than 40-50 billion at this time. The FED could step in and probably will.

That is why t be good Jim Sinclair's advice above might be good take some money but not all of it so you have some cash for a month or two.

Europe governments strive to avoid bank meltdown
http://biz.yahoo.com/ap/081006/eu_europe_meltdown.html

Treasury and Fed pledge rapid response to crisis
http://biz.yahoo.com/ap/081006/meltd...istration.html

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