On May 16 U.S. District Judge Katherine Forrest upheld her decision to block the controversial indefinite detention provisions in the National Defense Authorization Act (NDAA) of 2012, and the Obama Administration made a request for a more detailed explanation.

The defendants — Barack Obama, Leon Panetta, John McCain, John Boehner, Harry Reid, Nancy Pelosi, Mitch McConnell and Eric Cantor — argued that the order only stopped the government from indefinitely detaining the journalists and activists who brought the lawsuit.

But Judge Forrest has now clarified the injunction in a 8-page memorandum released Wednesday so as to "leave no doubt" that U.S. citizens cannot be indefinitely detained without due process.

This story was posted on the businessinsider.com website late yesterday evening...and I thank Roy Stephens for his first offering of the day. The link is here.

The 19 largest US banks are at least $50 billion short of meeting new capital requirements under the Basel III accords, according to rules proposed by the Federal Reserve.

The biggest among them would probably need billions of dollars more by the 2019 deadline to comply fully with the rules.

Smaller US lenders are about $10 billion short of the requirements, the Fed said on Thursday.

The Fed’s proposals, which will be phased in from next year, are part of a larger package implementing the Basel III accords in the US.

This Financial Times story from yesterday was picked up by CNBC...and I thank West Virginia reader Elliot Simon for sending it. The link is here.

If the collapse of the commodities brokerage firm MF Global were a murder mystery, the revelation that $1.6 billion of customer money had disappeared would be the equivalent of finding the corpse.

Who did it? And given that customer assets, by law, must be segregated from a firm’s assets and operations, how could it have happened?

This week, MF Global’s liquidation trustee, James W. Giddens, went a long way toward solving the mystery in a 181-page account of MF Global’s decline and fall.

This story was posted on The New York Times Internet site yesterday...and I thank reader Phil Barlett for sharing it with us. The link is here.

The view that this week provided only the opening policy response salvo is anything but unjustified. If things proceed in Europe (and globally) as I fear, we can expect the ECB to cut rates and implement additional liquidity measures, as the Fed moves forward with additional quantitative easing. The Chinese, Indians, Brazilians and others will stimulate in hope of sustaining faltering booms. And I expect all of these measures to have little, if any, constructive impact on deepening global Credit and economic crises. At the same time, the impact on financial markets is less clear. Even NYC taxi drivers are confident that policy measures are sure to bolster the markets. To what extent will the sophisticated operators now use generous market accommodation to head for the exits? It’s traditionally been referred to as “distribution.” Think Facebook IPO.

As always, Doug's CBB posted over at the prudentbear.com website, is a must read in times such as this...and this week's commentary is no exception. As always, I thank reader U.D. for sending it along...and the link is here.

Here is John Williams, of shadowstats.com fame, with his 75-page annual report, which is now published in the clear six months after he posted it on his Internet site for his paying subscribers.

This should keep you off the streets for a while...and I thank Australian reader Wesley Legrand for bringing it to my attention...and now to yours. The link to the pdf file is here.

Iceland's economy expanded in the first quarter at its fastest pace since its near-meltdown, powered by a surge in exports, tourism and domestic consumption.

Gross domestic product (GDP) grew 2.4 percent quarter-on-quarter in the first three months of the year to put annual economic growth at 4.5 percent in the period, the highest since the first quarter of 2008, data from the statistics office showed on Friday.

"It shows that the economy is growing rather rapidly, at least in an international comparison, at the moment," Islandsbanki Chief Economist Ingolfur Bender said.

"The increase is broad-based, driven by consumption, investment and exports."

This rather short Reuters story was filed from Stockholm late yesterday morning...and I thank reader 'David in California' for sending it. The link is here.

The European Commission is threatening to use EU competition rules to close down the failing Greek, Spanish and Portuguese banks that have pushed the eurozone into a new crisis, with Greece's ATEbank the first in its sights.

EU state-aid rules, designed to stop government subsidies distorting competition, give the commission sweeping powers to impose restructuring conditions on bank bailouts or even to block the rescue.

Over the past two years, the rules have been interpreted generously to allow government bank bailouts to go ahead in return for commitments to restructure failing financial institutions but the mood in Brussels has hardened since the initial credit crunch of 2009.

”We are moving into a new phase with Greece, Portugal and Spain,” an EU official told Reuters. “Some banks are going to be squeezed. Some are going to be closed down.”

This story was posted in The Telegraph early in their afternoon yesterday...and I thank Roy Stephens for his second offering of the day. The link is here.

Beijing and Moscow will send a clear message to the world at the ongoing Shanghai Cooperation Organization (SCO) summit. The leaderships of China and Russia have drawn two lines in the sand - an unequivocal "No" to bombing Iran, and another unambiguous "No" to regime change in Syria brought about through a Western bombing campaign.

Russian President Vladimir Putin arrived in Beijing yesterday to start his first overseas visit after he was elected as the Russian leader again, which highlights the importance he attaches to his country's relations with China. And in Beijing, no less, he is scheduled to hold talks with his Iranian counterpart, Mahmud Ahmadinejad. This is indicative of the joint Russian and Chinese geopolitical strategy.

Furthermore, Beijing and Moscow are playing defense against perceived Western militarism and aggression. In order to understand their shared interests and methods on the global stage, it is useful to examine the origins of the Shanghai Cooperation Organization itself.

For students of "The New Great Game"...this story, plus the next one, are must reads. I thank Roy Stephens for digging up both of them. The link is here.

Quietly and unobtrusively, a Russo-Pakistani rapprochement has been developing behind the scenes of world politics for the last two years. On Pakistan's side, the almost spectacular deterioration of relations with the United States and the North Atlantic Treaty Organization (NATO) has led it to seek new friends, especially as the alliance accelerates its withdrawal from Afghanistan.

Russia also fully understands that Pakistan is a crucial player in Afghanistan and that, as NATO withdraws, it becomes all the more urgent for Moscow to seek some sort of modus vivendi with Islamabad.

This modest, albeit real, rapprochement is, however, built upon a long-standing foundation of mistrust. Russian officials have long been concerned over the safety and security of Pakistan's nuclear weapons arsenal. Due to those concerns and Pakistan's record, foreign policy analysts like Alexei Arbatov observed that for Russia, Pakistan is a principal potential threat to non-proliferation.

This is the second must read story from the Asia Times...as it dovetails nicely with the previous AT story. The link is here.

Month over month inflation line just went negative.

More broadly, inflation by any measure is quickly dropping. The 3.0% YOY reading was below consensus estimates of 3.2%.

That's why China is panicking and cut rates on Thursday morning.

This tiny story, including a must see graph, was posted on the businessinsider.com website late last night. It's a must read for sure...and I thank Roy Stephens once again for sending it along. The link is here.

Global cheers over China's decision to cut interest rates faded on Friday as investors and economists worried that the move signaled the impending release of grim economic data.

China's surprise rate cut unveiled on Thursday boosted hopes that cheaper credit would help combat its faltering economic growth, and it encouraged global share markets in their belief that the major economies were stepping up stimulus.

But the central bank's cut, the first since the global financial crisis in late 2008, also raised concerns the economy may be weaker than previously thought.

Asian shares lost ground on Friday, worried that a deluge of May Chinese data due this weekend could produce ugly numbers.

This Reuters piece was filed from Beijing early on their Friday morning. It's another must read story...and I borrowed it from yesterday's edition of the King Report. The link is here.

Fortress Paper Ltd., announced that its wholly-owned subsidiary, Landqart AG, a leading manufacturer of banknote and security papers, has had a material banknote order reinstated. This order was unexpectedly suspended in the fourth quarter of 2011 which negatively impacted the financial results of Landqart's operations in the first half of 2012.

The rumour is that this 'material banknote order' is for Greece's new currency once it pulls the plug on the Euro. I thank Australian reader Wesley Legrand for sending it along...and the link to the zerohedge.com story is here.

The first ten pages of this 27-page report is all about gold and gold stocks. The author, Grant Williams of Vulpes Investment Management in Singapore, understands the inner workings of the gold market completely...as the list of gold commentators he says that you should listen to includes just about everyone in the gold price management camp...and the ones you shouldn't listen to are all "the usual suspects".

The first ten pages are a must read for sure...but the rest of the report is worth your time as well. I thank reader U.D. for sending it to me last Sunday...and the link is here.

The first one is by the mysterious "London Trader". It's entitled "Staggering 515 Tonnes of Gold Sold in 4 Hours". The second blog is with Peter Schiff...and it's headlined "World is Headed Off the Edge of the Fiscal Cliff". And lastly is this audio interview with Nigel Farage. The blog was posted in this space yesterday.

The Gold Report: You started your career, Dave, in the fixed income securities division of Goldman Sachs. And you worked as a junk bond trader before founding Golden Returns Capital. What prompted you to move into precious metals?

Dave Kranzler: After working as a bond trader on Wall Street, I was day trading. A friend suggested that I look at gold and silver. I initially poo-pooed that idea, as I was more interested in shorting technology stocks during the Internet bubble. I thought the tech valuations were based on nothing more than hopes and dreams, not on real wealth. The enormous growth in paper investments was driven by the incredible amount of money supply thrown into the system by Alan Greenspan's Federal Reserve.

But in late 2001, my friend finally convinced me to get serious about mining stocks. So I investigated the reasons why there had been a 20-year bear market in precious metals and why a long-term bull market was in the offing.

This interview was posted over at theaureport.com website on Monday...and I thank reader Dean DiPaola for sending it. The link is here.

So what is it about money that the leaders of the eurozone don't get?

Money has been around for a while, and it's not terribly complicated.

The key element is trust. That was true when money was a piece of metal that you could bite or bounce. Now that money is just a piece of paper, it's even truer. Today's money is nothing but trust.

That's why the euro crisis is so bizarre. The euro is, in theory, one of the world's great currencies. And yet, as this crisis has demonstrated, nobody actually stands behind it. There is no lender of last resort. There is no "full faith and credit." There's nobody on the other end of the promise.

And it's as if the leaders of the eurozone wanted to go out of their way to prove it. They've taken us up to the velvet curtain and then themselves, with a self-satisfied smile, pulled it aside to show us that there is no Great Oz.

This short, but very interesting story was posted on the money.msn.com Internet site on Thursday...and I thank reader Jon DeWeese for sharing it with us. The link is here.

Writing for GoldMoney, Felix Moreno de la Cova replies to Bloomberg News' most recent disparagement of investing in gold.

De la Cova writes: "When debtors are not to be trusted, there is a big difference between holding an IOU and cash in hand. That is the value of owning gold. When even 'cash' is debt, holding a real asset is immensely superior as a means of protecting your wealth. It is just plain common sense. That this particular asset was officially money a few decades ago is just icing on the cake.

"But of course those issuing the debt, and their hired propagandists, will tell a different story. They might even try to convince you that if you really, really want to buy gold you should consider buying this shiny new improved 'paper gold,' which is just as good as the real stuff. Fool me once...."

I borrowed the headline and the preamble from a GATA release late last night. De la Cova's commentary is headlined "The Real Cost of Not Owning Gold" and it's posted at the GoldMoney Internet site here.

There’s a lot to like about the European Redemption Pact, politically and economically, and a lot not to like if you’re worried that this German-inspired fund is the mother of all potential loot grabs.

On the positive side, the gold bricks are piled up like Lego in central bank vaults. They are unpledged and devaluation-proof, meaning the gold-backed loans would be ultra-cheap – probably 1 per cent. Politically, a gold-backed loan is defensible, in the sense that it’s cheap. The alternative is trying to flog sovereign bonds at crippling yields – 5 to 7 per cent. That, in turn would mean ratcheting up the austerity programs in an attempt to restore enough investor confidence to bring yields down.

The downside, of course, is potential default, which would mean transferring a huge chunk of a country’s hardest, most gorgeous assets – and hence economic power – out of the country. You would have to presume, however, that any country would be ultra careful to make sure it gets the gold back, as Italy did.

This reporter in Canada's Globe and Mail newspaper came very close to the truth in this piece that was posted on their website late Friday afternoon. The only thing that he doesn't see coming is the fact that the world's gold price will have to be revaluated to some fantastic amount to balance the books at all the Western world's central banks. My favourite number is somewhere between $8,000 and $18,000 the ounce. I borrowed this story from a GATA release which Chris Powell filed from Hong Kong early on their Saturday morning...and the link is here.

In an outline posted Friday at Zero Hedge, fund managers Lee Quaintance and Paul Brodsky make the case for resolving the world debt crisis with an asset monetization and revaluation based on the upward revaluation of gold by 800 to 1,000 percent, creating lots of money with which government debt could be liquidated and bringing hopeless mortgages and the banks that issued them back to solvency.

This introduction, and the Zero Hedge link from Chris Powell, is part of a larger preamble that's contained in this GATA release. It's a must read from one end to the other...and I thank Wesley Legrand for being the first one through the door with this story yesterday evening. The link is here.

There have been key developments in the physical gold market over the last few weeks which we feel are worth highlighting: The Chinese gold imports from Hong Kong in April, 2012 surged almost 1,300% on a YoY basis. Total gross imports for the month of April were 103.6 tonnes and the net imports were 66.3 tonnes. It is not the data for April alone which has caught our eye. There has been a stunning increase of gold imports through Hong Kong for export into China over the past 2 years. Between May 2010 and April 2011, China imported a net 66 tonnes of physical gold through Hong Kong. Between May 2011 and April 2012, that number jumped to 489 tonnes. This represents an increase of 640%.

The report just gets better from there. It was written by Eric Sprott and Shree Kargutkar...and was posted on the sprott.com website yesterday. I thank reader Neil West for finding it on our behalf. It's a must read of course...and the link is here.