Global Market Watch for March 28th, 2014
Gold Tax Increase in Japan
As of April 1st, Japan is raising a consumption tax from 5% to 8% on gold. Japan imposes a retail consumption tax on gold unlike most other countries. Indeed, the tax increased caused an early jump in gold sales in Japan during March. However, taxes are effecting gold in many ways. Because silver is taxes but gold is not in Europe, silver bars have been moved painted gold to avoid the taxes. This has distorted the numbers and led many to assume there was a higher demand for gold than there really was.
The weekly closing today below 1308 was bearish and support now lies at 1280 and 1240. As we warned at our conference, new lows are still likely to be seen in gold. Resistance should now start at the 1309-1311 area.
Christine Lagarde’s Home Raided on Corruption Probe
The home of IMF chief Christine Lagarde was raided by anti-corruption policeinvestigating her near $400 million pay-off of a prominent Nicolas Sarkozy supporter when she was French finance minister. Simply put, you cannot rise that high up in France without a corruption scandal.
Putin’s Popularity Soars As he Addressed the Nation on TV
President Vladimir Putin addressed his nation on Friday describing Russia’s takeover of Crimea as demonstrating Russia is back and the Russian flag is now flying over all military sites on the Black Sea peninsula. Putin addressed the nation saying … “The recent events in Crimea were a serious test…” and that the Russian military“demonstrated both the completely new capabilities of our Armed Forces and the high morale of the personnel.”
Putin has reserved the right to send troops into Ukraine, which is home to a large population of Russian-speakers in the east to protect Russians. He also praised the Russian troops for “avoiding bloodshed” in Crimea.
Putin has received permission from the Russian parliament to send the armed forces into Ukraine if necessary, raising concerns he could cite alleged threats to Russian-speakers in eastern regions as grounds for intervention there.
The US has been dangerously trying to surround Russia with nukes for the last decade. That violated the promises made back in 1991 that NATO would not attempt to move in. This has in many ways provoked Putin and has set the stage for his rising popularity. This is the same type of response the American people had for Reagan and the British displayed toward Margaret Thatcher with the Falklands War. When a nation has suffered a decline in power and respect, this is the standard response that can be expected. The West has not understood what it is doing and nobody seems to be even capable to articulating precisely WHY Russia is even an enemy when communism has collapsed. This is not 1945.
The Cycles of War Conference is Available for viewing
Friday – March 21st – 1-5 PM EST
We have recorded the full 4 hour Cycles of War Conference that is available for viewing on a video streaming. We covered the Cycles of War that will be coming out as a book given the demand for this subject has been so massive on a global scale. This was our first attempt at a live broadcast worldwide.
The Rising Star of Russia & Central Asia
Putin’s swift annexation of Crimea has been extremely popular in Russia and is akin to restoring the national pride within Russia as was the case of Ronald Reagan following the heals of Jimmy Carter and the whole Iran Hostage debacle.
Putin has lost Ukraine for now, but the economic conditions within the EU and the insane policies at the IMF inspired by the bankers mixed with internal corruption at the IMF that has been legendary, Putin’s dream of restoring the Soviet Empire are not gone. There will be a serious risk that Ukraine is driven into the arms of Russia by the IMF and the bankers who are more akin to the carpetbaggers that plagued the US South following the Civil War. Their polices are not designed to help the people of Ukraine, but to fill the pockets of the bankers. This is what they did to Greece as well.
Putin has lost Ukraine temporarily, and he is still building his former empire turning to Central Asia.Kazakhstan was one of two ex-Soviet countries, along with Belarus, that joined Russia’s customs union. Putin is moving forward with this plan and they will sign documents this year to form the Eurasian Economic Union. This is a trading bloc all within the former Soviet borders intended to economically compete against the EU.
The other four former Soviet republics in Central Asia are more-likely-than-not to join with Russia as Putin seeks to restore the influence of Russia in the Central Asia region. This will be a region in size that is equal to Western Europe stretching from the Caspian Sea all the way to China. None of these former Soviet republics have criticized Russia over Ukraine.
Western-style politics remains distrusted in Kazakhstan, Tajikistan, Turkmenistan and Uzbekistan where the rulers maintain very tight lids on any civil unrest. Only Kyrgyzstan is moving toward a parliamentary style republic. Kazakhstan has the greatest population of ethnic Russians.
Nevertheless, the actual Eurasian Economic Union is by no means a movement to simply hand political power to Moscow. Ironically, this the very design that President Bush, Sr. was promoting – a sort of United States of Russia keeping it intact for fear of nuclear weapons running amok.
Therefore, it appears that maintaining political independence within these former Soviet Republics is their self-interest within the political ruling class. Kazakhstan will by no mean cede its sovereignty to anyone. There is a fierce religious independence that in turn would prevent that sort of take-over by Moscow. Kazakhstan is predominantly a Muslim nation that declared its independence from Russia 22 years ago and they view the events in Ukraine as a direct threat to their nation given they are Christian. Kazakhstan produces oil and natural gas and is holding accession talks with the World Trade Organisation. Its economy correlates closely with Russia.
Putin’s March 1st announcement that he views it to be Russia’s right/obligation to invade its neighbors to protect ethnic Russians have raised alarm in Estonia, Latvia and even Poland. However, in Central Asia there does not seem to be the same degree of alarm. Kazakhstan back in 1991 had a population mix of about Kazakhs accounting for only about 40% of the population that was matched by ethnic Russians. Today, Russians account for only about 22% of the population and Kazakhs are now about 65%. There were occasional outbursts of ethnic tension that appeared back in 1990s and are likely to reemerge in 2017.
There are extreme nationalists in Russia who are demanding Russia take over northern Kazakhstan. This is a rising nationalistic trend that will get worse after 2015.75. Since the great collapse of the Soviet Union in 1991, we face the first major conjunction in politics come 26 years later or 2017.
IMF Demands Austerity for Ukraine
The IMF (International Monetary Fund) announced on Thursday that a $14 to $18 billion “bailout” for Ukraine is contingent on Kiev’s imposition of stringent austerity measures. It is amazing that not even Obama would comply with such austerity. These people have no clue as to how to run a nation and their theories are more-likely-than-not going to hurt a lot of people. All Putin has to do is stand on the sidelines and wait for the IMF will destroy the economy of Ukraine as they did in Cyprus and Greece. Lagarde should impose her own austerity on France – but that will never happen. It seems there is one policy for the world, and another for the main players. The IMF in my OPINION is so corrupt internally and is being lobbied by the bankers to ensure they get paid at the risk of sending the people back into a massive economic depression.
Ukraine should default. They do not need a bailout to pay the bankers. This is a new government and no new government has ever paid the debts of the previous and that includes the USA that defaulted on the Continental Congress debts. Just go to Ebay and you can buy bonds of many countries and their currency that they all defaulted on.
What happened to the Marshall Plan? Ukraine’s debt should be written off NOW! Let the bankers reap what they sowed. Do NOT listen to the IMF and their corrupt agenda. They should have been dissolved when the gold standard collapsed back in 1971. The sovereignty of a nation resides within the PEOPLE, not the politicians the bankers lent to. Legally, this is no different than lending money to your maid and then demanding you cover he debts.