Fitch Ratings on Tuesday affirmed its AAA credit rating on the United States and maintained a negative outlook, citing a diversified and wealthy economy that is undermined by the government's inability to agree on deficit reduction measures.

"The uncertainty over tax and spending policies associated with the so-called 'fiscal cliff' weighs on the near-term economic outlook," Fitch said in a statement.

A negative outlook gives Fitch 12 to 18 months by which it is expected to make a decision on the U.S. sovereign credit, pushing a decision well beyond the next presidential and congressional election cycle.

You can't make this stuff up. Like most of the PIIGS...all U.S. debt paper should be downgraded to junk. This CNBS story was posted on their website late yesterday afternoon...and I thank West Virginia reader Elliot Simon for sending it along. The link is here if you're seriously thinking about reading it.

If there is an event that should cost Gary Gensler his job as head regulator at the CFTC, it is this.

According to a just released Reuters report, the head of MFG(lobal) part 2, PFG, whose story we broke yesterday, Russell Wasendorf Sr. "intercepted and forged bank documents for more than two years to cover up hundreds of millions of dollars in missing money, a person close to the situation."

Once Wasendorf realized he was caught, and knew the implications of his actions would be exposed for the whole world to see, he tried to commit suicide, and failed. "Wasendorf, 64, is reported to be in a coma after a suicide attempt Monday morning, according to a complaint filed by the Commodity Futures Trading Commission on Tuesday that accuses Wasendorf and Peregrine of fraud."

And while crime happens all the time, what is truly stunning is that as we reported previously, the CFTC gave the firm a clean bill of health in its January inspection of Peregrine Financial Group. That's 6 months ago.

This Zero Hedge story from yesterday is worth skimming...and I thank reader Phil Barlett for sending it along. The link is here.

As big banks face the fallout from a global investigation into interest rate manipulation, American and British lawmakers are scrutinizing regulators who failed to take action that might have prevented years of illegal activity.

Politicians in both London and Washington are questioning whether regulators allowed banks to report false rates in the run-up to the 2008 financial crisis and afterward. On Monday, Congress stepped into the fray, requesting information about the role of the Federal Reserve Bank of New York, according to people close to the matter. The Senate Banking Committee on Tuesday also announced it was looking into the issue.

The focus on regulators and other financial institutions has intensified in the last two weeks after the British bank Barclays agreed to pay $450 million to resolve an enforcement case. British and American authorities accused the bank of improperly influencing key interest rates to deflect concerns about its health and bolster profits.

This story was posted in The New York Times late on Monday evening...and I thank Phil Barlett for sending it. The link is here.

The Federal Reserve Bank of New York may have known as early as August 2007 that the setting of global benchmark interest rates was flawed. Following an inquiry with British banking group Barclays Plc in the spring of 2008, it shared proposals for reform of the system with British authorities.

The role of the Fed is likely to raise questions about whether it and other authorities took enough action to address concerns they had about the way Libor rates were set, or whether their struggle to keep the banking system afloat through the financial crisis meant the issue took a backseat.

A New York Fed spokesperson said in a statement that "in the context of our market monitoring following the onset of the financial crisis in late 2007, involving thousands of calls and emails with market participants over a period of many months, we received occasional anecdotal reports from Barclays of problems with Libor.

I found this Reuters story posted in a GATA release early yesterday morning...and the link is here.

Reflecting on the LIBOR interest-rate report rigging scandal, the New York Sun wonders why interest rate setting is considered so magical, particularly in the hands of the Federal Reserve.

The Fedsters, the Sun writes, are "supposed to set their rates with an eye to maintaining full employment. But they've been lathering trillions of dollars over to the federal government and to banks, yet it seems the more they do it, the more contented the unemployment rate seems to be resting above 8 percent. That doesn't even count hidden unemployment and underemployment and persons dropping out of the look for work. It's gotten so bad that members of Congress are starting to think about whether they want to end the employment mandate. A key committee unanimously called for a tough, unprecedented audit of the Fed, and the chairman of the Fed, Ben Bernanke, is so concerned that he's broken precedent and started holding quarterly press conferences. ...

"Our own prediction is that out of this debacle will come greater impetus to monetary reform and the introduction into the conduct of monetary policy a reference to gold."

The Sun's editorial is headlined "Jawbone of an Ass"...and I thank Chris Powell for providing the headline...and the introduction. It's posted on the nysun.com website...and the link is here.

This 9:04 minute wimp.com video was sent to me by Vancouver Island reader John Ditomasso. I haven't had the time to watch all of it, but from what I've seen, I would suggest that it's an absolute must view...and the link is here. Also on the panel is Dennis Kelleher, President and CEO of Better Markets, Inc.

If the ancient Greek philosopher Diogenes were to go out with his lantern in search of an honest man today, a survey of Wall Street executives on workplace conduct suggests he might have to look elsewhere.

A quarter of Wall Street executives see wrongdoing as a key to success, according to a survey by whistleblower law firm Labaton Sucharow released on Tuesday.

In a survey of 500 senior executives in the United States and the UK, 26 percent of respondents said they had observed or had firsthand knowledge of wrongdoing in the workplace, while 24 percent said they believed financial services professionals may need to engage in unethical or illegal conduct to be successful.

This story was posted on Reuters website yesterday morning...and I thank Andrew Holland for digging this up on our behalf. The link is here.

The nation’s commodity futures regulator on Tuesday voted to define which derivatives will be considered swaps, letting loose a slew of transparency-focused regulations for the $650 trillion global industry, considered a key contributor to the financial crisis of 2008.

“Light will begin to shine on the swaps market for the first time,” said Commodity Futures Trading Commission chief Gary Gensler.

The commission including Gensler voted 4 to 1, with Bart Chilton, a Democratic commissioner, voting against the regulation.

The definitions are important because most of the derivatives regulations in the Dodd-Frank Act, written responding to the crisis, cannot become effective until swaps are defined.

I consider this marketwatch.com story from yesterday a must read...and I thank Florida reader Donna Badach for sending it our way. The link is here.

As the fourth anniversary of the Lehman Brothers debacle approaches, the government rescue efforts and bailouts continue to wind down.

The central component of the TARP was the Capital Purchase Program (CPP), under which the U.S. Treasury purchased preferred shares in hundreds of banks and received warrants in return. Banks started to return the capital in June 2009, with the largest institutions repaying first. Counting the extra assistance given to Citigroup and Bank of America, CPP recipients took $242.9 billion in funds. Banks have returned $230.71 billion of that total. Add in dividends ($14.69 billion), gains on the sale of Citigroup common stock ($6.85 billion) and funds received from the sale of warrants ($9.08 billion) and the CPP has turned a "profit" thus far of about $18.4 billion.

This story was posted on the finance.yahoo.com website yesterday...and I thank reader Scott Pluschau for sharing it with us. The link is here.

Two destroyers and three amphibious landing vessels carrying marines set sail from Russian bases in the Arctic and the Black Sea, according to Russian military sources.

Russia's defence ministry insisted that the mission was part of a previously scheduled exercise in the Atlantic, Mediterranean and Black Sea and at least one of the vessels in the flotilla has patrolled waters off Syria earlier this year.

But Western diplomats say the purpose of the mission is to show tangible support for Mr Assad, to warn the West against military intervention in Syria and to prepare for the possible evacuation of Russian nationals from the country.

Scott Pluschau sent me this story from The Telegraph yesterday...and the link is here.

The first blog features Jean Marie Eveillard...and it's headlined "Expect More Chaos As The Elites Are Now Totally Discredited". The second is with Jeffrey Saut, chief investment strategist for Raymond James. It's entitled "The Systemic Problem, I'm Not Sure It Can Be Fixed". And lastly is this Richard Russell blog that's headlined "Gold, Stocks & Massive Fed Manipulation".

CNBC seems to have started to put 2 and 2 together, giving hope that eventually the business television network might add them up to 4. The network's new introduction to Cheviot Asset Management Ned Naylor-Leyland's assertion on CNBC Europe this week that the gold and silver markets are as manipulated as the LIBOR interest rate report, refers to GATA secretary/treasurer Chris Powell's appearance on CNBC Asia on June 21. The new introduction to Naylor-Leyland's appearance earlier this week is posted at the CNBC video archive here...and both links are definitely worth your time.

What's Iran doing with Turkish gold?

That is the question [the] Beyondbrics [column] found itself asking after it had a look at Turkey's latest trade figures.

According to data released by the Turkish Statistical Institute (TurkStat), Turkey's trade with Iran in May rose a whopping 513.2 per cent to hit $1.7 billion. Of this, gold exports to its eastern neighbour accounted for the bulk of the increase. Nearly $1.4 billion worth of gold was exported to Iran, accounting for 84 per cent of Turkey's trade with the country.

So what's going on?

In a nutshell -- sanctions and oil.

This story showed up in the Financial Times of London on Monday...and is posted in the clear in this GATA release. The link is here.

Bolivia will consider nationalizing Canadian miner South American Silver Corp's silver property, President Evo Morales said on Sunday, following violent indigenous protests against the mining project.

Leftist Morales, who last month took control of global commodities giant Glencore's tin and zinc mine in the Andean country, said he hadn't taken a final decision on whether to revoke the Canadian miner's concession.

"Nationalization is our obligation, I already raised the issue of nationalizing (the Malku Khota project) last year, and I told (local residents) to reach an agreement, because when they want we're going to nationalize," Morales told a farmers' gathering.

This Reuters story was something I lifted from yesterday's edition of the King Report...and the link is here.

Brian from Manchester has lost faith in money. After selling his house, he decided to turn his cash into something he says he can trust - gold.

"I started in 2005 and now I've got £200,000 worth - about half of what I own - in gold.

"If I kept all my money in the bank, the value of my work would either devalue over the long-term or it would be wiped out."

Brian's worry is that inflation will erode the value of his savings over time, or worse still, that fragile banks and governments will fail to protect them in another financial crisis.

This story was posted on the bbc.co.uk Internet site last week...and I thank reader Iain Doherty for sending it along. The link is here.

John Aziz takes on Izabella Kaminska after her negative rant on gold was posted on the Internet the other day. Aziz writes...

"The obvious thing, though — even if we take central bank buying out of the equation altogether — is that total demand for gold is still increasing. And the price of gold has increased faster than sales, illustrating that the market has struggled and continues to struggle to keep pace with underlying demand."

"And it’s not just demand for gold-denominated paper (i.e. ETFs or other such as-risky-as-anything-you’ll-get-from-MF Global assets) — it’s recently manifested as demand for hard physical gold."

"It’s true that central banks are presently supporting the gold price — after years of selling off national wealth at pennies-on-the-dollar into a bear market and thus suppressing prices. Yet it’s not the Western central banks that are pushing demand for gold. It’s the BRICs. As PBOC official Zhang Jianhua noted: No asset is safe now. The only choice to hedge risks is to hold hard currency — gold."

John's commentary, which is well worth reading, was posted on the zerohedge.com website yesterday...and I thank reader Marshall Angeles for bringing it to my attention. The link is here.

There are those who say gold may go to $10,000 or to $0, or somewhere in between; in a different universe, they would be the people furiously staring at the trees. For a quick look at the forest, we suggest readers have a glance at the chart below. It shows that just in the first five months of 2012 alone, China has imported more gold, a total of 315 tons, than all the official gold holdings of the UK, at 310.3 tonnes according to the WGC/IMF (a country which infamously sold 400 tons of gold by Gordon Brown at ~$275/ounce).

This story was posted over at the Zero Hedge Internet site yesterday...and is a must read for sure. The chart alone is worth the trip. I thank Washington state reader S.A. for sharing it with us...and the link is here.

Mike Kosares, proprietor of Centennial Precious Metals in Denver, writes this week that while gold has entered the "public participation" phase of its bull market, the monetary metal likely has far more to run because the participation is only a fraction of what it has been in previous bull markets.

Kosares' commentary is headlined "Gold's Secular Bull Market: Past, Present, and Future," and it's posted at Centennial's Internet site, USAGold.com, here. I borrowed this story from a GATA release yesterday.