saveyourassetsfirst3 |
- Silver OI Explodes, Shorting Continues, CFTC Asleep, Again
- Watch the Gold/Silver Ratio
- Hey Silver Bugs......
- Timing Gold - Bond Yields Ratio Doesnt Matter Much, But Gold:Bonds Ratio Does
- Important commentary...Mubarak resigns/silver open interest and deliveries explode/whole story on the disappearing gold and silver
- In New California Gold Rush, Old Mines Reopen
- Bullion banks get Financial Times help in trying to talk silver down.
- Bullion banks get FT's help in trying to talk silver down
- Your Pension-Pot Warranty
- The Early Gold Wars
- Dear God, What Worthless Piece of Drivel - Gold Standard!
- The Impending Collapse of the 30% Premium for EGPT
- There crazy on ebay...Engelhard silver @127/oz!
- In Praise of Bernanke
- Losing Faith in Paper Money
- Is The Consumer “Recovering?”
- 21 Signs That The Once Great U.S. Economy Is Being Gutted, Neutered, Defanged, Declawed And Deindustrialized
- Bullion Banks Add to Net Short Silver Futures Positions
- Freeport McMoran: How It Trades Against Copper
- Silver and Gold Manipulation
- Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Again This Week
- Why it's finally time to bet big against Treasury bonds
- Trader alert: This hated sector is breaking out
- Buy and hold or trade in and out?
- Silver Bullion Backwardation Suggests Supply Stress
- Dutch Central Bank: Pension Fund Must Sell Gold
- Gold Miners Index May Be Warning Us…
| Silver OI Explodes, Shorting Continues, CFTC Asleep, Again Posted: 12 Feb 2011 03:23 AM PST COMEX NEWS: GOLD: -1,129,100 oz left standing, getting extremely high -JPM et al adds a massive 11,072 contracts short SILVER: -OI Explodes by 5000 contracts, level not seen in 2 years -Front deliveries going NOwhere -total standing this NON delivery month is 2,180,000 -JPM et el add massive 5500 contracts short totally unbacked fiat paper contracts So it seems there some haters out there | ||
| Posted: 12 Feb 2011 02:15 AM PST February 12, 2011 In precious metal bull markets, silver outperforms. Its price climbs at a faster rate than gold's price. The reverse happens in bear markets. | ||
| Posted: 12 Feb 2011 02:12 AM PST Listen to hour two with Sprott.... http://www.financialsense.com/financial-sense-newshour | ||
| Timing Gold - Bond Yields Ratio Doesnt Matter Much, But Gold:Bonds Ratio Does Posted: 12 Feb 2011 01:00 AM PST | ||
| Posted: 12 Feb 2011 12:51 AM PST | ||
| In New California Gold Rush, Old Mines Reopen Posted: 11 Feb 2011 11:37 PM PST Image:  Reader Phil Barlett provides my first gold-related story today. This one is from yesterday's edition of The New York Times...and bears the headline "In New California Gold Rush, Old Mines Reopen". It's very much worth the read...and the link is here. | ||
| Bullion banks get Financial Times help in trying to talk silver down. Posted: 11 Feb 2011 11:37 PM PST Comex silver inventories continue to decline. In New California Gold Rush, Old Mines Reopen. Interviews with Eric Sprott and John Embry...and much more. ¤ Yesterday in Gold and SilverThe gold price was pretty choppy...and carved out a bit of a low around the London a.m. gold fix at 10:30 a.m. in London. From there, it rallied to its high of the day at $1,369.90 spot, which was around 8:45 a.m. in New York trading. And it was, as they say, mostly downhill from there...with the low [$1,353.30 spot] coming at 12:50 a.m. Eastern. It didn't gain much of that decline back before the close of electronic trading at 5:15 p.m. in New York. The scale of Kitco's gold chart makes the action look worse than it really was, but it's quite obvious to me that the bullion banks were lurking about during the Comex session in New York.
Silver was pretty stubborn yesterday...and traded in a twenty cent range virtually all day Friday. But once London closed for the weekend at 4:00 p.m. GMT...11:00 a.m. in New York, the price got hit hard...and it, too, succumbed to the bullion banks' wishes. The New York high [$30.33 spot] came at 8:35 a.m...and the N.Y. low [$29.71 spot] occurred at 12:55 p.m. Eastern. The subsequent price rally that began after the low, stopped the moment that floor trading ended at 1:30 p.m...as the buyer vanished.
Here's the 10-minute silver chart for Friday courtesy of reader Steve C. You can see the big 3,300 contract spike in volume at the London close, as it stands out like the proverbial sore thumb.
The world's reserve currency opened around 78.20 at the beginning of Far East trading on Friday morning...and then rallied about 45 basis points. That rally came to an end at 11:00 a.m. in London...and then declined to its New York low price at precisely 11:00 a.m. Eastern...the close of the London gold market. That was also the exact time when the silver price [and gold as well, if you check closely] got hit by an avalanche of selling, as the dollar spiked higher. Coincidence? Not likely.
Until the 11:00 a.m. smack-down in both gold and silver...the gold stocks were well into positive territory. But precisely at 11:00 a.m. at the London close...and the dollar's low tick...the stocks got sold down...then basically traded sideways for the rest of the New York session. The HUI closed down 0.56%.
Here's the 5-day HUI to give you an overview for the week that was.
The CME's Daily Delivery report showed that 160 gold and 2 silver contracts were posted for delivery on Tuesday. The issuers and stoppers in gold were all the 'usual suspects'...and the link to the action is here. There was no activity reported in either the GLD or SLV ETFs yesterday. The U.S. Mint had another sales report. This time they reported selling another 12,500 ounces of gold eagles...along with another 49,500 silver eagles. Month-to-date the mint has sold 39,000 ounces of gold eagles and 986,500 silver eagles. The draw-downs continue from the silver stocks over at the Comex-approved warehouses. On Thursday they reported receiving only 2,154 ounces...and shipped 425,230 ounces of silver out the door. The link to that action is here. As silver analyst Ted Butler said on the phone yesterday...Friday's Commitment of Traders report was a "good news/bad news" kind of story. The good news being that the '4 or less' bullion banks did not increase their short positions in either silver or gold for the reporting period. The bad news was that the 'raptors'...as Ted calls them...liquidated a huge portion of their long positions and took profits from the recent run-up in price. As Ted has mentioned before, whenever the Raptors take profits by selling long positions, it has the effect of increasing the Commercial short position because that's the category these traders are located in. This is also the category that the '4 or less' bullion banks hide out...but they were not a factor in the week that was. It was mostly the smaller traders that weren't in the '8 or less' category. In silver, the Commercial net short position increased a huge 6,316 contracts, or 31.6 million ounces of the stuff. In gold, the Commercial net short position increased a very chunky 16,714 contracts, or 1.67 million ounces of gold. The good news is, that since these Raptors have taken their profits by selling out the bulk of their long positions, they won't be there to sell into the next rally, as they are effectively out of the market on the long side...although they do have small residual long positions left that will be sold at a later date. But that shouldn't affect the prices of either metal by much when it does happen. Here's Ted's "Day of Production to Cover" graph that's courtesy of Nick Laird over at sharelynx.com.
¤ Critical ReadsSubscribeUSPS warns of default as losses mountMy first two stories today are courtesy of reader Scott Pluschau. The first is posted over at money.cnn.com...and bears the headline "USPS warns of default as losses mount". The U.S. Postal Service warned Wednesday that it may default on some of its financial obligations later this year after reporting yet another quarterly loss. The link is here.  January deficit grows by $50B, on pace for $1.5 trillionScott's second offering is an AP story that was posted over at finance.yahoo.com...and is headlined "January deficit grows by $50B, on pace for $1.5 trillion". The federal government's budget deficit grew by $50 billion in January and is expected to finish the year as the highest in history. The link to the story is here.  Sysco profit falls as 'extreme' meat, dairy inflation raises costsReader Bill Moomau provides our next reading material from the rather obscure website foodsystemsinsider.com. The headline reads "Sysco profit falls as 'extreme' meat, dairy inflation raises costs". Sysco Corp. reported a lower-than-expected quarterly profit, with the largest U.S. foodservice company saying "extreme" inflation in meat, seafood and dairy products increased its costs and curbed customers' purchasing budgets. This rather short story is worth your time, as it shows the always insidious creep of inflation into the nations food-pricing system. The link is here.  States with the Highest Foreclosure RatesThe next story today is from reader Roy Stephens...and is posted over at cnbc.com. The headline reads "States with the Highest Foreclosure Rates". It's a photographic journey through the top 12 U.S. states with the highest foreclosure rates. Foreclosure filings—defined as a default notice, auction sale notice or bank repossessions—were up 1 percent in January from the previous month and down 17 percent from January 2010. One in every 497 housing units received a foreclosure filing during the month, according to Realty Trac's January 2011 Foreclosure Market Report. I thought it was very interesting...and the link is here.  Bernanke's 2009 Interview Withheld by Crisis PanelWashington state reader S.A. sent me the following Bloomberg story yesterday evening. I sent it to Chris Powell...and it's now a GATA release. The headline is astonishing and reads "Bernanke's 2009 Interview Withheld by Crisis Panel". The Financial Crisis Inquiry Commission, created by Congress to investigate and report on the causes of the market meltdown late last decade, won't publicly release its full 2009 interview with Federal Reserve Chairman Ben Bernanke, a commission spokesman said. More Fed secrets, dear reader...and the link is here.  Exclusive: Interview With Eric SprottWashington state reader S.A. has another story today...and this one's posted over at zerohedge.com. The headline reads "Exclusive: Interview With Eric Sprott". I know Eric a little bit...and I always like to pay attention to those people whose net worth has nine zeros after the first number. I think you should as well...and the link is here.  Mubarak Leaves Legacy of Egypt in Turmoil While Region at PeaceI see that Egyptian President Hosni Mubarak is history. Mubarak was brought down by an unexpected coalition of opposition politicians, members of the banned Muslim Brotherhood group and, most important, tens of thousands of young people who planned and organized the demonstrations on Facebook and Twitter. It will be interesting to watch to see what happens to Egypt now. Here's the Bloomberg story on that...and it's headlined "Mubarak Leaves Legacy of Egypt in Turmoil While Region at Peace". One has to wonder how long 'peace' will last in the other Arab states from this point onward...and the link to the story is | ||
| Bullion banks get FT's help in trying to talk silver down Posted: 11 Feb 2011 11:37 PM PST Image:  The next two stories are both GATA releases...and both are from the Financial Timesout of London. Chris Powell has headlined the first story "Bullion banks get FT's help in trying to talk silver down". Bankers said at least five miners had hedged a portion of their silver output in recent months, either by selling future production ahead of time at a fixed price or by buying options to protect against falling prices. | ||
| Posted: 11 Feb 2011 09:59 PM PST At least, that's what this Dutch pension fund calls gold... | ||
| Posted: 11 Feb 2011 04:45 PM PST | ||
| Dear God, What Worthless Piece of Drivel - Gold Standard! Posted: 11 Feb 2011 03:41 PM PST | ||
| The Impending Collapse of the 30% Premium for EGPT Posted: 11 Feb 2011 10:53 AM PST | ||
| There crazy on ebay...Engelhard silver @127/oz! Posted: 11 Feb 2011 10:19 AM PST | ||
| Posted: 11 Feb 2011 09:48 AM PST Long time readers will know of the Daily Reckoning's tradition to stand up for the downtrodden. Fraudsters, dictators, thieves and rogue traders have made the cut before. This time, though, it's a stretch. Poor old Ben Bernanke has been criticised from the left, right and centre. So what can be said for his merit? Well, the latest bundle of comments to stir outrage occurred during a Congressional hearing, where Bernanke was questioned on the prospects of inflation.
Bernanke's reply was that of a skilled central banker - shift the blame elsewhere. He pointed to several culprits. By mentioning surging demand for commodities, and restricted supply, he satisfied the intellectual demands of classical economists. Then he blamed foreign inflation on the foreign central banks who had printed too much money. That one was for the Monetarists. The Keynesians, of course, see inflation as a good thing, so they weren't bothered. That leaves us, the Austrian Economists. The hypocrisy of blaming inflation on foreign central banks is obvious when you look at the amount of US dollars created on Bernanke's watch. Besides, criticising your partners in crime seems a rather odd way to go about saving the world from deflation. But if you take a moment to look at Bernanke's reasoning, he does have a point. In a free market, countries who continuously import more goods than they export must send their money overseas to pay for all the consumption. This devalues their currency, which encourages exporting and discourages importing. The effect is an inherently stabilising and self-correcting trade balance. In keeping the Yuan pegged to the US Dollar, the Chinese have hindered this self-correcting mechanism between the two nations from taking hold. Each time Americans run trade deficits and dollars rush out of the US economy into world markets, the value of the dollar falls. To maintain the peg, the Chinese print Yuan and buy Dollars. This props up the Dollar's value and brings the exchange rate back to where the Chinese want it. The result is to encourage Americans to buy Chinese goods, which remain cheap. But by printing Yuan to maintain the peg, the Chinese create domestic inflation. Bernanke's money printing has added to the natural pressure of dollars flooding world markets to pay for America's imports. Dollars are not only falling in value because Americans are buying foreign goods, but because Bernanke is creating more of them. This added pressure means China will have to create even more Yuan to maintain the currency peg. This will stoke even more inflation in China. Who is to be blamed for Chinese inflation, then? The Americans for printing money to devalue their currency, or the Chinese for printing money to maintain the peg? In this case, it only takes one to tango. If Ben stopped printing and Americans continued to buy Chinese goods, the Chinese central bank would have to print less Yuan to maintain the peg, but it would still have to print. Bernanke is merely forcing their hand. The Chinese didn't bow to market forces quickly enough for his liking, so now Bernanke is on the case. Eventually, inflation will be too much to bear and the Chinese will have to let their currency appreciate. This will mean printing less Yuan and inflation in China will fall. And, theoretically, it will encourage Americans to buy American goods, which will have become relatively less expensive than Chinese goods. So, it seems, Ben Bernanke is doing the free market's work. At least backing it up. But the issue is that the domestic effects of Bernanke's money printing will come home to roost if the Chinese stop buying Dollars to maintain the currency peg. If they give up on the peg, as Bernanke is trying to force them to do, the US Dollars he is creating will create inflation in America. It is much the same situation as this person encountered. For now, China is attempting to fight off inflation by increasing interest rates. Ironically, real rates are still negative (inflation is higher than the interest rate).That means Chinese rates are in fact stimulating the economy, not slowing it. But, if China does revalue the Yuan in a sincere effort to fight off inflation, watch out for some serious inflation in America. Unfortunately, it's likely that such inflation will outweigh the benefits of the devaluation of the Dollar to American industry. So, as well intentioned as they are, you probably can't expect Bernanke's efforts to be fruitful. For Americans, that is. How all this could affect Australians is a different matter. If the US goes into high rates of inflation and China's export market can't afford its goods, that doesn't bode well for anyone here in Oz. Still, it's preferable to be sitting on a pile of resources rather than a pile of paper assets (China) or debt (US). Imbalances like this tend to get settled by sovereign defaults, which tend to follow banking crises. What a coincidence. GDP in 2011 2011 is going to be a good year for economists. Not so good for the rest of us though. Why? Because economists, for the most part, think GDP is important. Why is a bit of a mystery considering what actually makes up GDP. Do jobs factor in? Nope. How about productivity? Nope. When you buy chicken, forget about it until it starts to smell and then throw it out? ... Yup, that's GDP! Hmmm. Let's look at why American GDP is expected to jump in 2011. Last December, Congress decided to reduce the payroll tax, which pays for Social Security, by 2 percentage points for one year, meaning it went from 6.2% to 4.2% of taxable income. This jump in disposable income will go straight to the likes of Wal-Mart, where it will add to the GDP. Hooray! The amount that the government will have to borrow to fund the shortfall in revenue is not subtracted from GDP... An even better example of creating GDP, also recently implemented in the US, is when the government decides to declare depreciation expense a tax deduction. That encourages business to buy those things the government has applied the deduction to, which spurs GDP. Hooray! Again, the government's additional borrowing to fund the shortfall in revenue is not considered. It's probably not too much of a stretch to say that GDP is about the easiest thing in the world to create. But are you doing your bit for your country's GDP? When you go home to cook dinner, remember you are not increasing GDP in doing so. You did when you bought the food, but not if you grew it. And cooking and eating won't show up in the statistics, unless you go to a restaurant. Put another way, if we wanted to create GDP, you could cook my dinner and I cook yours, and we each charge each other the same amount. Voila! We have created GDP! (And taxable income.) So, there you have it. GDP can be produced at the whim of the government and has little to do with what people actually do in their lives. And yet economists are citing GDP as proof of a private sector recovery, lauding politicians for their efforts to create it. But what happens when the tax deductions mentioned above end? Not only will GDP fall. Investment and consumer spending will contract by the amount the "stimulus" allowed it to grow. And much of it will turn out to be a waste. Government will have encouraged unsustainable spending. That means the resources will be unprofitable. Uh oh. For an example of how efforts like this play out, think back to the US government-engineered housing bubble and its dramatic "pop" in the late 2000s. Although that episode still hasn't ended. Reuters reports:
Below 50%! The government supports 50% of the mortgage market? No, "The government currently backstops more than 85 percent of the $10.6 trillion mortgage market." Wow, no wonder there was a bubble. But efforts are being made to implement America's capitalist beliefs. The hike in FHA costs will "give the private sector a dominant role". Do you think the private sector has a dominant role in a 50% government-backed market? Worth Noting We would like to mention two asides today. First of all, inflation is not as hidden a hidden tax as you might think. Not only do governments and banks get to spend new money at unadjusted prices, but they also profit from the central banks efforts to implement monetary policy. The Federal Reserve's revenue from holding securities, which now include all sorts of exotic securities alongside government debt, goes to the Treasury in so called "remittances". A transfer of wealth from the economy, which in 2009/10 totalled about $125 billion! That's 0.9% of US GDP. Add to this that the Fed is now the largest holder of US government bonds, which means the Treasury is paying itself a large part of the interest on its bonds. In other words, the Fed has turned a $125 billion cost into a $125 billion profit for the Treasury without anyone's approval or oversight. The second aside is a warning. The so-called inflation hawks on the Federal Reserve's board are being shot down systematically. Reuters reports the last one is set to step down in March. It's all remarkably similar to Stalin purging the Soviet government of anyone who wasn't prepared to agree with him. Nick Hubble | ||
| Posted: 11 Feb 2011 09:21 AM PST  02/11/11 Tampa, Florida – I was planning to go into a bizarre and irrational rant against JP Morgan for its obvious scam of manipulating the silver market by massive naked-short positions, and including in my Loud Mogambo Diatribe (LMD) the scumbag government and "regulators" who are supposed to keep this kind of fraud out of the commodities markets. Preparing myself by taking a long pull on a bottle of tequila, rehearsing every curse word I could remember and loosening up the vocal cords ("Mi mi miiiiii! Get out of my yard, you stupid kids! Yo, Adrian!"), I was almost ready when I got a copy of an email from David Bond, in his role as First Lord of the Treasury for the Island Kingdom of Colemania, who reports the news that JP Morgan has announced that they will accept gold as collateral for margin loans. The part that saved me from denouncing JP Morgan is when he went on that "Whilst JP Morgan is pleased to now to accept physical gold as collateral for credit, it will NOT ACCEPT equivalent value (or any value) of shares in its own gold ETF in lieu thereof." Even I, jaded and cynical after a lifetime of watching one thieving bastard after another foist a screw-job on me, and watching one incompetent, corrupt government moron after another let them, I think that it is all encapsulated in his sentence that the lesson is that "Ergo (or is it ipso facto?) JP Morgan has great faith in physical gold, but concurrently has no faith in its own gold-backed paper." Its own ETF! JP Morgan runs an Exchange Traded Fund for gold, giving it complete control over the gold deposited there, and yet doesn't trust its own fund? Has JP Morgan actually sold the gold that the ETF buyers were told was in there? Hmmm! That would make ME lose faith in it paper, too! And as far as depositing gold with JP Morgan, Chris Powell of the Gold Anti-Trust Action Committee seems as cynical as I when he says, "Good luck getting it back." But suddenly everybody wants gold, especially as the Federal Reserve created more credit (which turns into money when somebody borrows it) last week, and Total Fed Credit went up last week by $19 billion. As to how much actual money this turned into is anybody's guess since the fractional-reserve multiplier used by banks ranges from here to, literally, infinity. But $18.4 billion of it turned into cash! I know this because the Fed used $18.4 billion of it to buy government securities to fund the loathsome Obama administration's deficit-spending insanity! And, in December, more money was created when revolving debt climbed by $3.5 billion. And more money was created to allow total personal debt to shoot up $6.1 billion in December, too. All in all, seemingly impossible amounts of money are being created, which means seemingly impossible amounts of inflation, which means seemingly impossible amounts of capital gains from buying gold and silver rising in price, which seemingly explains why I am seemingly always saying, "Whee! This investing stuff is easy!" Read more: Losing Faith in Paper Money http://dailyreckoning.com/losing-faith-in-paper-money/#ixzz1DhWcoJ8F
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| Posted: 11 Feb 2011 09:17 AM PST Let's breakdown the December trade deficit numbers released today. For all of December, the trade deficit was $40.6 billion, roughly in-line with expectations and up $2.7 billion from November. The media is already pointing to the fact that imports increased by $5.1 billon from December to November as the signal that the U.S. consumer has returned and the economy is improving. But let's look at the golden truth. The total value of goods imported in December was $116.6 billion, up $2.9 billion from November. Of that, $22.5 billion was oil, up $2.7 billion from November. THUS, of the total amount of the increase in goods imported from November to December, $2.7 billion – almost 100% – of that was oil. Does that look like the consumer is spending more money on "consumables and durables?" Rest assured, the full amount of the value of oil imported was from higher prices. The consumer in this country is now spending an even bigger percentage of his monthly paycheck on oil. THAT is bad for the health of the economy. What is more interesting, in terms of the inflation picture, is the fact that China appears to be taking measures to "repatriate" inflation back to the U.S. by raising interest rates and slowly strengthening the value of the yuan. This will cause the price of Chinese imports (i.e. Walmart, Best Buy, Target, etc) to rise in value, further exacerbating the accelerating price inflation in this country. This will be GREAT for gold/silver. Make no mistake about that. And another little tidbit of news that you won't find reported on most U.S. media sources is that Viet Nam, the 5th largest importer of gold in the world, just devalued its currency by 7% – a huge amount in terms of currency devals. Here's the LINK This will further fuel inflation in Viet Nam AND further fuel the demand for gold by the population in that country. It's so simple to weed thru the garbage reported in this country to get at the truth. It's stunning how few people are interested in doing this. I just heard about someone I know, who I thought had a lot of money socked away. It turns out he's scrambling now to make ends meet. This is someone who used to be a big corporate executive and I tried to convince him to unload his real estate and move into gold over 8 years ago…oh well, it is what it is…Have a great weekend everyone (Avete una grande fine settimane, ognuno)
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| Posted: 11 Feb 2011 08:35 AM PST 
Meanwhile, wave after wave of shiny new factories is going up in nations such as China, India and Brazil. This is great for those countries, but for the millions of American workers that desperately needed the jobs that have been sent overseas it is not so great. This is the legacy of globalism. Multinational corporations now have the choice whether to hire U.S. workers or to hire workers in countries where it is legal to pay slave labor wages. The "great sucking sound" that Ross Perot warned us about so long ago is actually happening, and it has left tens of millions of Americans without good jobs. So what is to become of a nation that consumes more than it ever has and yet continues to produce less and less? Well, the greatest debt binge in the history of the world has enabled us to maintain (and even increase) our standard of living for several decades, but all of that debt is starting to really catch up with us. The American people seem to be very confused about what is happening to us because most of them thought that the party was going to last forever. In fact, most of them still seem convinced that our brightest economic days are still ahead. After all, every time we have had a "recession" in the past things have always turned around and we have gone on to even greater things, right? Well, what most Americans simply fail to understand is that we are like a car that is having its insides ripped right out. Our industrial base is being gutted right in front of our eyes. Most Americans don't think much about our "trade deficit", but it is absolutely central to what is happening to our economy. Every year, we buy far, far more from the rest of the world than they buy from us. In 2010, the U.S. trade deficit was just a whisker under $500 billion. This is money that we could have all spent inside the United States that would have supported thousands of American factories and millions of American jobs. Instead, we sent all of those hundreds of billions of dollars overseas in exchange for a big pile of stuff that we greedily consumed. Most of that stuff we probably didn't need anyway. Since we spent almost $500 billion more with the rest of the world than they spent with us, at the end of the year the rest of the world was $500 billion wealthier and the American people were collectively $500 billion poorer. That means that the collective "economic pie" that we are all dividing up is now $500 billion smaller. Are you starting to understand why times suddenly seem so "hard" in the United States? Meanwhile, jobs and businesses continue to fly out of the United States at a blinding pace. This is a national crisis. We simply cannot expect to continue to have a "great economy" if we allow our economy to be deindustrialized. A nation that consumes far more than it produces is not going to be wealthy for long. The following are 21 signs that the once great U.S. economy is being gutted, neutered, defanged, declawed and deindustrialized.... #1 The U.S. trade deficit with the rest of the world rose to 497.8 billion dollars in 2010. That represented a 32.8% increase from 2009. #2 The U.S. trade deficit with China rose to an all-time record of 273.1 billion dollars in 2010. This is the largest trade deficit that one nation has had with another nation in the history of the world. #3 The U.S. trade deficit with China in 2010 was 27 times larger than it was back in 1990. #4 In the years since 1975, the United States had run a total trade deficit of 7.5 trillion dollars with the rest of the world. #5 The United States spends more than 4 dollars on goods and services from China for every one dollar that China spends on goods and services from the United States. #6 In 1959, manufacturing represented 28 percent of all U.S. economic output. In 2008, it represented only 11.5 percent and it continues to fall. #7 The number of net jobs gained by the U.S. economy during this past decade was smaller than during any other decade since World War 2. #8 The Bureau of Labor Statistics originally predicted that the U.S. economy would create approximately 22 million jobs during the decade of the 2000s, but it turns out that the U.S. economy only produced about 7 million jobs during that time period. #9 Japan now manufactures about 5 million more automobiles than the United States does. #10 China has now become the world's largest exporter of high technology products. #11 Manufacturing employment in the U.S. computer industry is actually lower in 2010 than it was in 1975. #12 The United States now has 10 percent fewer "middle class jobs" than it did just ten years ago. #13 According to Tax Notes, between 1999 and 2008 employment at the foreign affiliates of U.S. parent companies increased an astounding 30 percent to 10.1 million. During that exact same time period, U.S. employment at American multinational corporations declined 8 percent to 21.1 million. #14 Back in 1970, 25 percent of all jobs in the United States were manufacturing jobs. Today, only 9 percent of the jobs in the United States are manufacturing jobs. #15 Back in 1998, the United States had 25 percent of the world's high-tech export market and China had just 10 percent. Ten years later, the United States had less than 15 percent and China's share had soared to 20 percent. #16 The number of Americans that have become so discouraged that they have given up searching for work completely now stands at an all-time high. #17 Half of all American workers now earn $505 or less per week. #18 The United States has lost a staggering 32 percent of its manufacturing jobs since the year 2000. #19 Since 2001, over 42,000 U.S. factories have closed down for good. #20 In 2008, 1.2 billion cellphones were sold worldwide. So how many of them were manufactured inside the United States? Zero. #21 Ten years ago, the "employment rate" in the United States was about 64%. Since then it has been constantly declining and now the "employment rate" in the United States is only about 58%. So where did all of those jobs go? The world is changing. We are bleeding national wealth at a pace that is almost unimaginable. We are literally being drained dry. Did you know that China now has the world's fastest train and the world's largest high-speed rail network? They were able to afford those things with all of the money that we have been sending them. How do you think all of those oil barons in the Middle East became so wealthy and could build such opulent palaces? They got rich off of all the money that we have been sending them. Meanwhile, once great U.S. cities such as Detroit, Michigan now look like war zones. Back in 1985, the U.S. trade deficit with China was about 6 million dollars for the entire year. As mentioned above, the U.S. trade deficit with China for 2010 was over 273 billion dollars. What a difference 25 years can make, eh? What do you find when you go into a Wal-Mart, a Target or a dollar store today? You find row after row after row of stuff made in China and in other far away countries. It can be more than a bit difficult to find things that are actually made inside the United States anymore. In fact, there are quite a few industries that have completely and totally left the United States. For certain product categories it is now literally impossible to buy something made in America. So what are we going to do with our tens of millions of blue collar workers? Should we just tell them that their jobs are not ever coming back so they better learn phrases such as "Welcome to Wal-Mart" and "Would you like fries with that"? For quite a few years, the gigantic debt bubble that we were living in kind of insulated us from feeling the effects of the deindustrialization of America. But now the pain is starting to kick in. It has now become soul-crushingly difficult to find a job in America today. According to Gallup, the U.S. unemployment rate is currently 10.1% and when you throw in "underemployed" workers that figure rises to 19.6%. Competition for jobs has become incredibly fierce and it is going to stay that way. The great U.S. economic machine is being ripped apart and dismantled right in full view of us all. This is not a "conservative" issue or a "liberal" issue. This is an American issue. The United States is rapidly being turned into a "post-industrial" wasteland. It is time to wake up America. | ||
| Bullion Banks Add to Net Short Silver Futures Positions Posted: 11 Feb 2011 08:04 AM PST HOUSTON -- If people were looking for a large, oversized increase in the net short positioning by the big bullion banks this reporting week in the CFTC commitments of traders report (COT), they won't find what they were looking for. As silver tacked on $1.78 or more than 6% (to $30.29 on the Cash Market) between COT reporting Tuesdays, the category of futures traders the CFTC classes as Producer, Merchant, Processor and Users (PMs), which we believe the big bullion banks report under, shows an increase of 3,071 contracts to 44,984 contracts net short. That's an increase of 7.3% to their net short positioning according to data released this Friday afternoon by the CFTC. The graph just below shows the PM net positioning in silver futures on the COMEX, division of the CME. ... | ||
| Freeport McMoran: How It Trades Against Copper Posted: 11 Feb 2011 07:59 AM PST Zecco submits: By Richard Bloch I forgot who was discussing it, but someone on CNBC’s "Fast Money" was suggesting that copper and gold miner Freeport McMoran (FCX) doesn’t seem to be trading well. After all, copper itself has surged to new highs, but as of February 9, Freeport is off more than 10% from the 2011 high of about $61 (adjusted for the 2:1 split on February 2). It gapped down after its January earnings report as you can see on this chart: | ||
| Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Again This Week Posted: 11 Feb 2011 07:10 AM PST Gold fell $5.30 to $1357.20 in London before it rose to see a $5.63 gain at $1368.13 in early New York trade and then fell back off for most of the rest of the day, but it then bounced off its late session low of $1353.65 in the last half hour of trade and ended with a loss of just 0.2%. Silver fell to $29.91 and rose to $30.285 before it also fell back off in later trade, but it then bounced off its early afternoon low of $29.688 and ended with a loss of just 0.23%. | ||
| Why it's finally time to bet big against Treasury bonds Posted: 11 Feb 2011 06:41 AM PST From Terry Coxon, The Casey Report: ... For investors who've followed the inflation vs. deflation debate and who've come down on the side of inflation, shorting Treasurys looks like a sure thing – and has looked that way for the last two-and-a-quarter years. But for investors who acted sooner rather than later, results have been disappointing. Every time rates started to rise, bad news from somewhere would revive fears of everlasting recession, a new wave of defaults, or a tumble into the deflationary abyss. Housing prices would take another step down. The reported unemployment rate would stall or rise. The specter of a default in the sovereign debt of a European country would reappear. And every time, whatever the problem, it would stimulate flight-to-safety demand for U.S. Treasury securities. So there was no sustained rise in T-bond yields. ... If you were one of the earlier investors, you may have already thrown in the towel. With the meter running, being early doesn't feel much better than being wrong. But I believe that the mere passage of time plus the accumulation of inflationary forces (also known as "stimulus") has stacked the deck in favor of shorting Treasury bonds as a timely move. Later is now. Here are the reasons... Read full article... More on interest rates: Why rising interest rates could be super-bullish for gold Jim Rogers: How anyone can profit from the coming crisis This could be the most important financial news of the entire year | ||
| Trader alert: This hated sector is breaking out Posted: 11 Feb 2011 06:17 AM PST From Bespoke Investment Group: The municipal bond market has had a rough go of it over the last three months as concern about default risk has risen. Today, however, munis are catching a bid. Below is a price chart of the National Municipal Bond ETF (MUB) over the last six months. The ETF is currently trading at its highest level since... Read full article (with chart)... More trading ideas: Trader alert: The best way to play gold now Why the long-awaited correction could begin today These market-leading stocks are no longer participating in the rally | ||
| Buy and hold or trade in and out? Posted: 11 Feb 2011 05:10 AM PST I wanted to ask other peoples strategies on trading or holding mining stocks. I bought a position in August of 2001, and have held 100% invested the whole time. I do what I call 'ratio trade' where I may dump one position for another when I see a key opportunity, but I have been fully invested since the original purchase. My performance is at the present time 20 times my original investment. I have a second account that I bought in the fall of 2005 that is currently up 4 times the original investment, again all in mining/commodity stocks. I was more conservative with this second account as it was basically proceeds from a second home I sold. Have others done better by trading in and out, paying taxes, etc? | ||
| Silver Bullion Backwardation Suggests Supply Stress Posted: 11 Feb 2011 02:52 AM PST | ||
| Dutch Central Bank: Pension Fund Must Sell Gold Posted: 10 Feb 2011 08:25 PM PST SLV adds more silver...and the Comex ships out more silver. Silver Backwardation for Years, Possible Hyperinflation - James Turk. "The Rarest Earth"...an essay by silver analyst Ted Butler...and much more. ¤ Yesterday in Gold and SilverThe gold price was under pressure pretty much through the entire Far East and London trading session on Thursday...with the low of the day coming shortly after the Comex open at $1,350.50 spot. Shortly after 10:30 a.m. Eastern, gold finally caught a bid...with gold's New York high coming a few minutes before 11:30 a.m. at $1,367.40 spot. From there, it basically traded sideways into the close of electronic trading.
Silver traded mostly unchanged until around 1:00 p.m. Hong Kong time on Thursday. From that point, the selling pressure really began in earnest. Silver's low came shortly after 11:00 a.m. GMT in London...and traded sideways until it's New York low of $29.69 around 8:35 a.m. Then silver also caught a bid...and hit its zenith [$30.32 spot] shortly before lunch...and then closed a bit lower than that in electronic trading at 5:15 p.m. Eastern.
The dollar went on a bit of a tear yesterday...opening around 77.60 in early Thursday morning trading in the Far East...and had tacked on about 60 basis points by the close of trading in New York. It's easy to attribute most of gold's and silver's decline in Far East and early London trading to the steady rise of the dollar...but that doesn't explain the big rallies in both metals that occurred in early morning trading in New York, as the world's reserve currency continued to rise.
The gold shares pretty much followed the gold price action on Thursday...and although they recovered somewhat from their absolute lows, the HUI still finished down 0.83%...despite the fact that gold finished unchanged from Wednesday. This is very similar to the HUI action on Wednesday, even though gold finished unchanged from Tuesday...which you can see on the gold chart above.
The CME Delivery Report showed that 87 gold and 63 silver contracts were posted for delivery on Monday. All the major New York bullion banks were in attendance...and the link to the action is here. The GLD ETF showed another decline yesterday. This time it was 29,270 troy ounces. But over at the SLV ETF they had a fairly chunky addition...585,976 ounces of the stuff. The U.S. Mint had smallish sales report yesterday...adding another 2,500 ounces of gold eagles along with 40,000 silver eagles. Month-to-date gold eagle sales are 26,500 ounces...and 937,000 silver eagles. Another chunk of silver was withdrawn from the Comex-approved depositories on Wednesday. This time it was 383,690 troy ounces...and the link to that action is here.
¤ Critical ReadsSubscribeGet ready for higher food pricesToday's first story is courtesy of Washington state reader S.A....and is posted in yesterday's edition of the Omaha World-Herald. The headline reads "Get ready for higher food prices"...Warnings of higher food prices headed for American supermarkets and restaurants were swallowed easily across much of farm country Wednesday. The big gulp came when the U.S. Department of Agriculture reported that global demand had pushed U.S. corn supplies to their lowest point in 15 years. The story is worth your while...and the link is here.  Ron Paul Says Next US Crash Will Be Comparable To That Of Soviet Union, Claims QE2 Is "Total Failure" And Fed Is A "Central Planning Cartel"The next piece is also from Washington state reader S.A. It's a posting over at zerohedge.com that's headlined Ron Paul Says Next US Crash Will Be Comparable To That Of Soviet Union, Claims QE2 Is "Total Failure" And Fed Is A "Central Planning Cartel". Not too many shades of gray here. The piece contains a couple of video clips as well...and the link is here.  Spain orders drastic caja clean-up to win confidence and fight off EMU debt contagionYesterday I ran a story about record Portuguese bond yields. Now Spain is trying to prevent this from happening to them by getting their financial house in order. This is Roy Stephens' first item of the day...and it was filed late last night in The Telegraph. It's an Ambrose Evans-Pritchard offering headlined "Spain orders drastic caja clean-up to win confidence and fight off EMU debt contagion". Spain has imposed draconian rules on its saving banks and is preparing for part-nationalisation of the industry to restore confidence and boost the country's defences against contagion from the debt crisis in Portugal. The link to the story is here.  Prominent Chinese Economist Advises Country To Sell Its $500 Billion In GSE Holdings Before QE2 EndsReader U.D. came up with today's next read. It's another zerohedge.com offering that's headlined "Prominent Chinese Economist Advises Country To Sell Its $500 Billion In GSE Holdings Before QE2 Ends". This plan would dovetail nicely with every TIC [Treasury International Capital] report that China continues to sell its agency debt...as well as lowering its U.S. Treasury holdings. The link is here.  Vietnam Devalues Dong by 7%, Risking Faster InflationThe next story was filed from Ho Chi Minh City in Vietnam earlier this morning. It's a Bloomberg piece headlined "Vietnam Devalues Dong by 7%, Risking Faster Inflation"...and its courtesy of Russian reader Alex Lvov. Vietnam's fourth devaluation in 15 months takes place with its inflation rate at the fastest in almost two years, and with the IMF describing its foreign-currency reserves as being "low." No wonder the Vietnamese people are rabid gold buyers. The link to the story is here.  US and Egypt trade barbs as tension mounts in CairoEgyptian correspondent, Roy Stephens, has three stories about the continuing uprising in that country. The first is found posted over at the france24.com website...and is headlined "US and Egypt trade barbs as tension mounts in Cairo". The link is here.  Egypt Strikes Continue as Doctors, Lawyers Join ProtestsRoy's second story on Egypt is an AP story that's posted over at the huffingtonpost.com website. It's headlined "Egypt Strikes Continue as Doctors, Lawyers Join Protests"...and the link to this very short piece is here.  Mubarak Refuses to Step Down, Stoking Revolt's Fury and ResolveThe last story regarding Egypt is this item from yesterday's edition of The New York Times, where the headline reads "Mubarak Refuses to Step Down, Stoking Revolt's Fury and Resolve". The declaration by Mr. Mubarak that he would remain president appeared to signal a dangerous escalation in one of the largest popular revolts in Egypt's history, and some protesters warned that weeks of peaceful rallies might give way to violence as early as Friday. It's a longish read, but worth it, in my opinion...and the link is here.  Dutch Central Bank: pension fund must sell goldToday's first gold-related story was first sent to me by reader 'David in California'...and then ended up as a GATA release later in the day. The rather disturbing AP story was picked up by Bloomberg with a headline that reads..."Dutch Central Bank: pension fund must sell gold". I'm sure we'll hear more about this as the days unfold...but I'm not reading a lot into it at the moment. If they're smart, they'll take that money and buy silver with it. Here's the link to the GATA release on this, as I can't find the story on Bloomberg anymore.  Interview With Cazenove Capital Management's Robin GriffithsNext is a King World News audio Interview With Ca | ||
| Gold Miners Index May Be Warning Us… Posted: 10 Feb 2011 03:27 PM PST |
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