Gold World News Flash |
- Is The End Of The Euro In Sight?
- Bring Out Your Dead - UBS Quantifies Costs Of Euro Break Up, Warns Of Collapse Of Banking ...
- News That Matters
- Debt Collapse - $20,000 Gold
- Marc Faber Sees No Bubble in Gold as Central Banks Print Money
- UBS Quantifies Costs Of Euro Break Up, Warns Of Collapse Of Banking System And Civil War
- QVM Market Notes: Glass More Half Empty Than Half Full
- Gold: Knock, Knock, Knocking On Record's Door
- Gold: Knock, Knock, Knocking On Record's Door
- The Black Monday the Public Doesn't Know About
- Contagion Spreads To Asia: CDS Update
- Guest Post; The Inception-Style Dream is Collapsing
- Western ‘Pension Crisis’ Reflects Investment Incompetence
- FLASHBACK June 2011: The Federal Reserve Admits They “Own” No Gold
- Don Coxe Update – Sept 2nd
- What Bob Pisani Forgot to Tell You About GLD
- More Beijing embassy cables show China sees gold as central in currency war
- Bring Out Your Dead – UBS Quantifies Costs Of Euro Break Up, Warns Of Collapse Of Banking System And Civil War
- The Meek Shall Inherit The Earth
- Bring Out Your Dead - UBS Quantifies Costs Of Euro Break Up, Warns Of Collapse Of Banking System And Civil War
- Futures Re-Open...Down
- $500 Silver If You Want It
- The fireworks are just beginning!!!
- Guest Post: Unseemly Scramble For Libya’s Post-Gaddafi Oil Assets Underway
- Where’s Our Oil Price Collapse?
- Bloomberg Ignores Major Stock Market Fall in Europe
| Is The End Of The Euro In Sight? Posted: 05 Sep 2011 07:58 PM PDT If the euro does collapse, it would likely cause a financial panic that would make 2008 look like a Sunday picnic.
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| Bring Out Your Dead - UBS Quantifies Costs Of Euro Break Up, Warns Of Collapse Of Banking ... Posted: 05 Sep 2011 07:52 PM PDT Unfortunately trillions more in taxpayer capital will be lost before we get there. UBS just unwittingly announced the final countdown for the EUR
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| Posted: 05 Sep 2011 06:59 PM PDT
By thetrader.se Ft.com
Big US banks in talks with state prosecutors to settle claims of improper mortgage practices have been offered a deal that is proposed to limit part of their legal liability in return for a multibillion dollar payment. The FT says talks aim to settle allegations that banks including Bank of America, http://ftalphaville.ft.com/thecut/2011/09/06/669681/us-banks-in-robosign...
Eurozone bank sector tensions have increased the volume of euros parked overnight at the European Central Bank to levels not seen for more than a year, the FT reports. Some €151.1bn was left by banks in the ECB's deposit facility over last weekend, http://ftalphaville.ft.com/thecut/2011/09/06/669596/banks-park-record-vo...
George Osborne needs to "step up a gear" and deliver a game-changing growth plan if he is to have a chance of reviving a flagging British economy in 2012, the CBI warned as it downgraded its forecasts for next year after a tumultuous August. http://ftalphaville.ft.com/thecut/2011/09/06/669526/cbi-presses-osborne-...
President Barack Obama used a Labor Day rally to call again for more infrastructure spending and a payroll tax cut ahead of Thursday's nationally televised jobs speech, reports Reuters. "We've got more than 1 million unemployed construction workers ready to get dirty right now. http://ftalphaville.ft.com/thecut/2011/09/05/669511/obama-previews-big-j...
Indian authorities have arrested a top mining baron as part of a crackdown on illegal iron ore extraction, in the latest move to stamp out political corruption in the country, reports the FT. Janardhan Reddy, http://ftalphaville.ft.com/thecut/2011/09/05/669426/indian-tycoon-held-i...
Libyan oil production will not return to pre-war levels until late next year at the earliest, with many of the country's oil facilities having suffered heavy damage and looting during the conflict, according to the newly appointed chairman of the country's National Oil Company. Offering the most detailed assessment yet of the outlook for Libya's oil output in an interview with the Financial Times, Nuri Berruien said it would be late 2012 or early 2013 before the country was again producing the 1.6m barrels per day it had before this year's uprising agains Muammer Gaddafi . http://www.ft.com/intl/cms/s/0/c382946a-d7b5-11e0-a06b-00144feabdc0.html...
A Chinese official confirmed on Monday that Colonel Gaddafi's regime sent representatives to China to discuss buying weapons from arms companies long after the imposition of UN sanctions but said the Chinese government was unaware of the visit at the time. Jiang Yu, the official, also stressed that no contracts were signed and no arms shipments were made. The revelations were first reported by the Globe and Mail of Toronto. http://www.ft.com/intl/cms/s/0/77a3e566-d7bb-11e0-a06b-00144feabdc0.html...
Wsj.com
Australia's central bank left its cash rate target unchanged at 4.75% Tuesday, as expected by economists. Interest rates have now been on hold for almost a year, with the Reserve Bank of Australia balancing inflation concerns against an increasingly fragile world environment and signs of slowing in some industries locally. A high Australian dollar has also taken pressure off the central bank to tighten interest rates beyond its current "mildly restrictive" stance. The RBA raised interest rates seven times between October 2009 and November 2010, giving Australians some of the highest interest rates in the developed world. http://online.wsj.com/article/SB1000142405311190453740457655362117433587...
International financial markets tumbled as a darkening global economic outlook and deepening fissures in Europe over its debt crisis fueled fears the world economy could slip into a period of prolonged malaise.The Stoxx Europe 600 index fell 4.1% Monday, with banks hard hit. The euro slid below $1.42, its lowest in a month. The declines followed a slide in Asia, where stock indexes in China and Japan dropped by about 2% Monday. On Tuesday morning Asian markets again moved lower, with Japan shares falling 1.2% by late morning. During early Asian trading the 10-year U.S. Treasury yields hit as http://online.wsj.com/article/SB1000142405311190453740457655287186877030...
Italy's industry minister has dismissed widespread calls for Rome to speed up its timetable for passing budget-tightening measures, rebutting criticism that the Italian government's austerity package isn't tough enough to dig the country out of the euro-zone debt crisis. http://online.wsj.com/article/SB1000142405311190453740457655238358288344...
South Korea's revised second-quarter gross domestic product growth grew a revised, seasonally adjusted 0.9% from the previous quarter, confirming that Asia's fourth-largest economy is slowing amid growing concerns about the possibility of the world economy falling into a double-dip slump. The revised growth rate is slightly faster than the 0.8% rate estimated by the Bank of Korea in July, but slower than the 1.3% on-quarter expansion in the first quarter. http://online.wsj.com/article/SB1000142405311190453740457655333249784666...
U.K. retailers are braced for more downbeat news as summer earnings are expected to show continued weak consumer demand, especially for hard-hit electrical retailers, with the sector still nursing the wounds of the August riots and economic and market turmoil. Analysts expect no respite until December. Meanwhile, consumer confidence continues to fall and the threat of a return to recession looms large. Polling firm GfK NOP Wednesday said its main measure of consumer confidence fell to minus 31 in August, equalling the low it hit in April. In July, the index stood at minus 30. http://online.wsj.com/article/SB1000142405311190490090457655233341454823...
Swiss bankers and politicians on Monday tried to deflect growing pressure from U.S. authorities on Switzerland to reveal additional client data in a continuing tax dispute between the two countries. Concerns arose over the weekend that the banks may have to hand over more client data by Tuesday, as details of a letter from U.S. Deputy Attorney General James Cole asking for more account information from potential U.S. tax dodgers became public, triggering a sharp response http://online.wsj.com/article/SB1000142405311190453740457655213224676055...
Deutsche Bank AG Chief Executive Josef Ackermann warned that prospects for the financial sector are constrained by the mounting debt burden of sovereign and private debtors and that Germany's largest bank might need to shed jobs if the negative market trend from August continues. Mr. Ackermann conceded that European banks don't face a "rosy" future in their home markets unless they can gain market share. Deutsche Bank has made an attempt at this by taking over retail bank Deutsche Postbank and other units. http://online.wsj.com/article/SB1000142405311190453740457655211097826019...
Reuters.com
Oil fell more than 2 percent for a third successive day of losses on Monday, tumbling in tandem with other risk assets as European bank and debt jitters and doubts over global growth haunted traders. ICE Brent futures for October fell $2.25 to $109.92 a barrel by 3:30 EDT, nearing the 200-day moving average support line at $109.26. U.S. crude futures dropped $2.85 to $83.61 a barrel, putting the closely watched Brent/WTI spread at what would be a record close of $26.31. Volume was predictably thin, with Brent crude at only about 40 percent of its average and U.S. trading at 10 percent. http://www.reuters.com/article/2011/09/05/us-markets-oil-idUSTRE77838320...
China's economic growth may ease to below 9 percent in 2012, partly due to a weak global economy, a senior Chinese foreign exchange official said on Tuesday, backing market expectations that the world's No. 2 economy is set for a mild easing. But even as the economy cools, Huang Guobo, the chief economist at China's currency regulator, the State Administration of Foreign Exchange, told a forum that inflation is still a policy focus for Beijing in coming months. "The Chinese economy is facing serious challenges despite strong growth," Huang said. http://www.reuters.com/article/2011/09/06/us-china-economy-safe-idUSTRE7...
Australian banks will need to meet new global capital rules ahead of the internationally agreed timetable under proposals made on Tuesday, although the move is unlikely to force any of them to raise any new equity immediately. The new Basel III rules, aimed at preventing another global banking crisis, require lenders to hold more capital aside in the form of equity, reserves and retained earnings in case of a sharp economic downturn. http://www.reuters.com/article/2011/09/06/us-australia-banks-idUSTRE7850...
Bloomberg.com
Hurricane Katia "strengthened considerably" to a category 4, the second-highest level, as it churned over the Atlantic, the National Hurricane Center said. Katia had maximum sustained winds of 135 miles (215 kilometers) per hour, according to an advisory at 11 p.m. New York time yesterday. The system was about 450 miles south of Bermuda traveling northwest at 10 mph. http://www.bloomberg.com/news/2011-09-06/hurricane-katia-strengthens-to-...
The number of chief executive officers cutting profit forecasts fell 38 percent below average last month, even as the slowing economy pushed valuations to the lowest level at the start of September since 1985. A total of 138 companies reduced earnings forecasts in August, compared with the average of 221 for the same month since 2000, according to data compiled by Bloomberg. At the same time, the Standard & Poor's 500 Index slumped 5.7 percent, pushing its price-earnings ratio to 13.3, the data show. Futures on the S&P 500 that expire this month fell as much as 2.8 percent today. http://www.bloomberg.com/news/2011-09-06/ceos-cutting-forecasts-fall-38-...
Cnbc.com
Republican presidential hopeful Mitt Romney will propose a jobs plan to cut corporate taxes, reduce federal regulations and get tough against China on trade. In a column set to appear in Tuesday's USA TODAY newspaper, the former Massachusetts governor said his plan would consist of 59 proposals, including 10 that he would introduce on his first day in office. http://www.cnbc.com/id/44402688
The austerity measures implemented by British finance minister George Osborne risk pushing the UK economy into recession, Bill Gross, the manager of PIMCO, said in an interview with the Times newspaper. Gross, who manages the world's biggest bond fund, told the newspaper that a "mid-course correction" of the fiscal plans would lift the economy and should not damage the country's standing with bond investors. | ||||||
| Posted: 05 Sep 2011 06:56 PM PDT Goldsilver
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| Marc Faber Sees No Bubble in Gold as Central Banks Print Money Posted: 05 Sep 2011 06:43 PM PDT Sept. 6 (Bloomberg) — Gold's rally above $1,900 an ounce shows no signs of a "bubble" as central banks continue to boost money supply that has helped spur bullion to a record, according to investor Marc Faber. "I don't think that gold is in a bubble," Faber, publisher of the Gloom, Boom and Doom report, said in a phone interview yesterday from Chiang Mai, Thailand. "When you buy gold, it's an insurance against systematic failure and problems in the financial markets." Faber's comments come amid predictions gold may tumble after surging 35 percent this year and touching a record $1,913.50 an ounce on Aug. 23, as investors sought haven asset amid declining equities and weakening currencies. Speculative demand from investors had pushed the gold market into a "bubble that is poised to burst," Wells Fargo & Co. analysts led by Dean Junkans said in a report last month. "I'd buy every month a little bit of gold," Faber said. Manufacturing slowed in the U.S. Europe and Asia, adding to signs of slowing global growth that may force central banks to step up stimulus measures. The Federal Reserve completed its second round of so-called quantitative easing in June, whereby the central bank purchased $600 billion of Treasuries from November 2010, after injecting $1.25 trillion in the first round. Goldman Sachs Group Inc. and Citigroup Inc. see the Bank of England restarting bond buying as early as this week as the economic recovery weakens and bank- funding costs increase. Gold Holdings Holdings in exchange-traded products backed by gold rose to a record 2,217 tons on Aug. 8, and stood at 2,142.4 tons as of yesterday. Bloomberg data show. Trade volume in Comex gold futures and options rose on Aug. 24 to a record 593,405 contracts, according to Jeremy Hughes, Singapore-based spokesman of CME Group Inc. Read more: Businessweek By Chanyaporn Chanjaroen
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| UBS Quantifies Costs Of Euro Break Up, Warns Of Collapse Of Banking System And Civil War Posted: 05 Sep 2011 05:01 PM PDT [Ed Note: This can't be good for anything other than the price of gold. And silver.] By Tyler Durden Any time a major bank releases a report saying a given course of action is too costly, too prohibitive, too blonde, or simply too impossible, it is nearly guaranteed that that is precisely the course of action about to be undertaken. Which is why all non-euro skeptics are advised to shield their eyes and look away from the just released report by UBS (of surging 3 Month USD Libor rate fame) titled "Euro Break Up – The Consequences." UBS conveniently sets up the straw man as follows: "Under the current structure and with the current membership, the Euro does not work. Either the current structure will have to change, or the current membership will have to change." So far so good. Yet where it gets scary is when UBS quantifies the actual opportunity cost to one or more countries leaving the Euro. Notably Germany. "Were a stronger country such as Germany to leave the Euro, the consequences would include corporate default, recapitalisation of the banking system and collapse of international trade. If Germany were to leave, we believe the cost to be around EUR6,000 to EUR8,000 for every German adult and child in the first year, and a range of EUR3,500 to EUR4,500 per person per year thereafter. That is the equivalent of 20% to 25% of GDP in the first year. " It also would mean the end of UBS, but we digress. Where it gets even more scary is when UBS, like many other banks to come, succumbs to the Mutual Assured Destruction trope made so popular by ole' Hank Paulson : "The economic cost is, in many ways, the least of the concerns investors should have about a break-up. Fragmentation of the Euro would incur political costs. Europe's "soft power" influence internationally would cease (as the concept of "Europe" as an integrated polity becomes meaningless). It is also worth observing that almost no modern fiat currency monetary unions have broken up without some form of authoritarian or military government, or civil war." So you see: save the euro for the children, so we can avoid all out war (and UBS can continue to exist). The scariest thing, however, by far, is that for this report to have been issued, it means that Germany is now actively considering dumping the euro.
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| QVM Market Notes: Glass More Half Empty Than Half Full Posted: 05 Sep 2011 04:57 PM PDT We have substantially lightened stock positions some weeks and months ago, and are holding that for the time being. We regret that we exited gold positions during its sudden and expected fall from a near vertical rise. Read More...
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| Gold: Knock, Knock, Knocking On Record's Door Posted: 05 Sep 2011 04:38 PM PDT Update: gold is now at a fresh all time nominal high, with a price equivalent to that fateful year in which the world's biggest and perfectly legitimate criminal cartel was founded on Jekyll Island some years ago. When it comes to gold, one can now officially skip the foreplay (because apparently there is such a thing s a 2G spot). Unlike two weeks ago when the latest Shanghai margin hike caused gold to temporarily lose its equilibrium and flop, however briefly, somewhere in the lower 1700s, as of tonight it has valiantly processed, and completely ignored, news from the Shanghai Gold Exchange that trading margins for the gold forward contract, Au(T+D), will be raised, temporarily starting Sept 9 to 13 percent from 12 percent, while the daily circuit breaker would be lifted to 10 percent from 9 percent, and has proceeded to rise to within nickels of the all time high, with spot trading over $1910 at last check. Since Europe is about to open shortly, and since the free fall in risk will resume now that virtually every rhetorical gimmick has been used and abused ad inf, it appears that absent the CME doing away with margin altogether, we will see $2G spot within hours.
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| Gold: Knock, Knock, Knocking On Record's Door Posted: 05 Sep 2011 04:38 PM PDT
When it comes to gold, one can now officially skip the foreplay (because apparently there is such a thing s a 2G spot). Unlike two weeks ago when the latest Shanghai margin hike caused gold to temporarily lose its equilibrium and flop, however briefly, somewhere in the lower 1700s, as of tonight it has valiantly processed, and completely ignored, news from the Shanghai Gold Exchange that trading margins for the gold forward contract, Au(T+D), will be raised, temporarily starting Sept 9 to 13 percent from 12 percent, while the daily circuit breaker would be lifted to 10 percent from 9 percent, and has proceeded to rise to within nickels of the all time high, with spot trading over $1910 at last check. Since Europe is about to open shortly, and since the free fall in risk will resume now that virtually every rhetorical gimmick has been used and abused ad inf, it appears that absent the CME doing away with margin altogether, we will see $2G spot within hours.
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| The Black Monday the Public Doesn't Know About Posted: 05 Sep 2011 04:22 PM PDT The dollar index broke out of it falling pattern and has made a run up to the first resistance level of 75.40. I feel we could see it go a little higher on Tuesday but overall it looks ready for a pause or pullback here. Read More...
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| Contagion Spreads To Asia: CDS Update Posted: 05 Sep 2011 04:16 PM PDT There are those who may be surprised to find that China is not completely insulated from the latest fun in Europe, America, and all those other places where the ponzi is imploding. To those same people we suggest a casual reading of the following two articles by Bloomberg and MNI - frankly we are too lazy to summarize. As for the market: it already knows whats up. Below is the nth consecutive drift up in most Asian CDS as once again credit predicts and idiots momos react, and after losing a shitload of money, confirm. CDS 5Y MID-MKT ASIAIG s15 171
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| Guest Post; The Inception-Style Dream is Collapsing Posted: 05 Sep 2011 04:08 PM PDT
Submitted by Chris Capre of 2ndskiesforex The Inception-Style Dream is Collapsing Following the lovely goose egg of a jobs report last week, markets started the week with an Asian Invasion rout led by the Hang Sang down 3%, and the Kospi shedding 4.4%. The second act of this sonata was Europe getting hammered led by a German Blitzkrieg 1-2 punch with the DAX losing 5.28% but more uniquely, the German 10-yr setting a new record below 2%. With all these trick-or-treats haunting the markets one has to ask, 'Is the Ticking Time Bomb Going Off and the Inception-Style Dream Collapsing?' We think so and we will begin by looking to a place that would seem most odd…the institutional players. Using the S&P Consolidated data, the Institutional/Asset Mgrs. are long over 409k (net positions). When was the last time these blokes were this long? Rewind back 3 years and 4 months ago to May 2008. In May that year, the S&P's high was 1440. What did the market do after that? Collapse to 667. We are suspecting a repeat here with a Thelma and Louise cliff-dive gap on Tuesday in the S&P weekly charts and likely in the DJIA. Should the latter one experience a down gap, if history has anything to say about this, a gap will bring some pain with it for over the last 80yrs, the DJIA has gapped 12 times with only one weekly gap being down. When was that? June 9th 1930 and the index tanked 21% in 2 weeks. Could this be the unlucky 13th gap? Likely so with Europe imploding and growing concerns about a hard landing for China, we see nothing to stop this rout. One last note… On Aug. 21st, we posted using our weekly Ichimoku Kumo Break Analysis stating the S&P in the last 8 years has only broken the weekly Kumo 2x, the first time being in 2008 which led to a rougly 800pt drop in the index, and the last time was on the 3rd week in August. We wrote about the markets possibly doing a small retracement to the 1220 level, and the markets didn't disappoint…only going 10pts higher, then slamming down over 80pts while failing to close inside the weekly Kumo. The combination of this rejection at 1230 (also 50% fib of the July 22nd 1350 high to Aug. 12th weekly low at 1107) lining up with a diving Tenkan-Sen (momentum-line) and a failure to close inside the Kumo suggests the original break was legitimate and the markets should easily touch down on the yearly lows. Any break of these lows and we suspect this will shatter any remaining thoughts from the butane-inhaling bulls thinking the last rally was the real slim-shady.
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| Western ‘Pension Crisis’ Reflects Investment Incompetence Posted: 05 Sep 2011 02:37 PM PDT by Jeff Nielson, Bullion Bulls Canada:
A Reuters article published today tells us that (once again) dangerously under-funded Western pension funds are lurching toward a "crisis". In some respects, a pension crisis in the corrupt, debt-bloated economies of the Western industrialized world was inevitable. The massive accumulation of debt is a large and relentless "drag" on the economies of these nations – guaranteeing lower rates of return over the long run for most asset classes. This is coupled with the massive "pension overhang" of the spendthrift baby-boomers, who not only buried our nations in debt, but then squandered most of their own wealth in mindless consumption. Proving, however, that you can always "make a bad situation worse", the administrators of pension funds have also mirrored the incompetence of most mainstream financial advisors – who have gone from being architects of "wealth creation" to the implements of "wealth destruction". The proof of the utter incompetence of almost all these suit-stuffers is abundant, and it starts with the Golden Rule of investing: "buy low and sell high". What do we see virtually all mainstream financial advisors and pension fund administrators doing today? They are selling equities (which have been plunging in value), and (so we have been told) are paying the highest prices in history to buy U.S. Treasuries. Read More @ BullionBullsCanada.com
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| FLASHBACK June 2011: The Federal Reserve Admits They “Own” No Gold Posted: 05 Sep 2011 02:12 PM PDT | ||||||
| Don Coxe Update – Sept 2nd Posted: 05 Sep 2011 02:01 PM PDT
Q+A 1. Opinion on Brazilian rate cut? Is it a canary in the coal mine? 2. Comment on under performance of gold equities from 70′s to now? 3. What is gold in the ground for a miner that is cheap? 4. Chinese debt comments and special offbook financing they have done? Impact to Chinese banks? 5. What have been the catalysts that cause a narrowing of bullion and gold equities in the past?
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| What Bob Pisani Forgot to Tell You About GLD Posted: 05 Sep 2011 01:15 PM PDT Bob Pisani from CNBC takes a tour of the SPDR Gold Trust Vault in London but forgets to tell you what the prospectus really says. After reading the prospectus, GLD seems to be littered with clauses that screw the holder of GLD. Gold is in a bull market but central bankers do not want the public to buy physical gold and silver to hedge against inflation and deflation or hyperinflation.
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| More Beijing embassy cables show China sees gold as central in currency war Posted: 05 Sep 2011 12:58 PM PDT 9:17p ET Monday, September 5, 2011 Dear Friend of GATA and Gold: More news media-monitoring cables from the U.S. Embassy in Beijing to the State Department in Washington show that both China's government and the nation's financial press, tightly controlled by the government, consider gold to be the main weapon in a world currency war that is under way. The additional cables, published a few days ago by Wikileaks and located by GATA's Irish friend R.M., disclose that China thinks that the United States is trying to prevent China's foreign exchange surplus from being converted into gold because the U.S. and its European allies plan a return to a gold standard that will favor them because they hold most of the world's gold reserves. China itself has acknowledged that it is rapidly building its own gold reserves to facilitate international use of its currency, the renminbi. The citation of the gold-related commentaries by the U.S. embassy cables suggests that China's acquisition of gold is of great concern to the U.S. government as well. ... Dispatch continues below ... ADVERTISEMENT Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit, Company Press Release, October 27, 2010 VANCOUVER, British Columbia -- Sona Resources Corp. reports on five drillling holes in the third round of assay results from the recently completed drill program at its 100 percent-owned Elizabeth Gold Deposit Property in the Lillooet Mining District of southern British Columbia. Highlights from the diamond drilling include: -- Hole E10-66 intersected 17.4g gold/ton over 1.54 metres. -- Hole E10-67 intersected 96.4g gold/ton over 2.5 metres, including one assay interval of 383g of gold/ton over 0.5 metres. -- Hole E10-69 intersected 85.4g gold/ton over 4.03 metres, including one assay interval of 230g gold/ton over 1 metre. Four drill holes, E10-66 to E10-69, targeted the southwestern end of the Southwest Vein, and three of the holes have expanded the mineralized zone in that direction. The Southwest Vein gold mineralization has now been intersected over a strike length of 325 metres, with the deepest hole drilled less than 200 metres from surface. "The assay results from the Southwest Zone quartz vein continue to be extremely positive," says John P. Thompson, Sona's president and CEO. "We are expanding the Southwest Vein, and this high-grade gold mineralization remains wide open down dip and along strike to the southwest." For the company's full press release, please visit: http://sonaresources.com/_resources/news/SONA_NR19_2010.pdf One of the cables from the embassy in Beijing, dated February 8, 2010, quotes commentary published that day in the China Business News newspaper in Shanghai, as follows: "This time the quick change of the U.S. policy (toward China) has surprised quite a few people. The U.S. has almost used all deterring means, besides military means, against China. China must be clear on discovering what the U.S. goals are behind its tough stances against China. In fact, a fierce competition between the currencies of big countries has just started. A crucial move for the U.S. is to shift its crisis to other countries -- by coercing China to buy U.S. treasury bonds with foreign exchange reserves and doing everything possible to prevent China's foreign reserve from buying gold. The nature of such behavior is a rogue lawyer's behavior of 'ripping off both sides': taking advantage of cross-strait divergences, blackmailing the Taiwan people's wealth by selling arms to Taiwan, and meanwhile coercing China to buy U.S. treasury bonds with foreign exchange reserves and extorting wealth from the mainland's people. If we [China] use all of our foreign exchange reserves to buy U.S. Treasury bonds, then when someday the U.S. Federal Reserve suddenly announces that the original 10 old U.S. dollars are now worth only one new U.S. dollar and the new U.S. dollar is pegged to the gold, we will be dumbfounded. Today when the United States is determined to beggar thy neighbor, shifting its crisis to China, the Chinese must be very clear what the key to victory is. It is by no means to use new foreign exchange reserves to buy U.S. Treasury bonds. The issues of Taiwan, Tibet, Xinjiang, trade, and so on are all false tricks, while forcing China to buy U.S. bonds is the U.S.'s real intention." The cable quoting the China Business News commentary can be found here: http://cables.mrkva.eu/cable.php?id=247683 And at GATA's Internet site here: http://www.gata.org/files/USEmbassyBeijingCable-02-08-2010.txt The second gold-related cable, dated December 4, 2008, quotes commentary published the previous day in the official Chinese Communist Party newspaper, People's Daily, as follows: "Be vigilant when considering restoring the gold standard system. "Recent Western opinion has advocated a new Bretton Woods system with the U.S. dollar as the core and restoration of the 'gold standard' to solve the financial crisis. The appearance of such thought is not accidental. There is a great deal of background. The American financial crisis has caused the loss of the U.S. dollar's credit. Therefore, American financial strategists seek to use the gold standard system to maintain the global financial system led by the U.S. The reason that the U.S. and Europe choose to use gold standard is the fact that the most of gold reservation in the world is in their control. The restored gold standard system will not be the original gold standard system, but instead a 'partial reserve system' partially based on gold. Therefore, rapid economic growth will be relatively limited in the area of currency supply. The possible consequences would be: first, due to the economic growth of the U.S. and Europe is low, the partial reserve system can satisfy their currency supply and will not form serious restriction on their economy, but will greatly restrict China, India, and other developing countries. Second, developing countries have to spend lots of foreign reserve to purchase gold. This decision betrays the common wish of the international society to substantially reform the international financial system." The December 4, 2008, cable can be found here: http://cables.mrkva.eu/cable.php?id=181326 And at GATA's Internet site here: http://www.gata.org/files/USEmbassyBeijingCable-12-04-2008.txt On Saturday the Internet site Zero Hedge was first to call attention to a U.S. Beijing embassy cable from 2009, published by Wikileaks, showing that China's government has been aware of U.S. and European government efforts to suppress the price of gold to support their own currencies, and that the U.S. government knew that China knew: http://www.gata.org/node/10381 CHRIS POWELL, Secretary/Treasurer Join GATA here: Toronto Resource Investment Conference http://cambridgehouse.com/conference-details/toronto-resource-investment... The Silver Summit http://cambridgehouse.com/conference-details/the-silver-summit-2011/48 New Orleans Investment Conference http://www.neworleansconference.com/ Support GATA by purchasing gold and silver commemorative coins: https://www.amsterdamgold.eu/gata/index.asp?BiD=12 Or by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Lewis E. Lehrman on How to Solve the U.S. Debt Problem Lewis E. Lehrman, chairman of the Lehrman Institute, sponsor of The Gold Standard Now project, advises that to reduce the $1 1/2 trillion U.S. deficit, the Republican Party must initiate an investment program. Working Americans are not saving, which enables the banks to lead the country into a cycle of debt, leverage, boom, panic, and bust. Lehrman says: "Eliminating the budget deficit of a trillion and a half dollars cannot be done overnight. The proposal by U.S. Rep. Paul Ryan was very dramatic -- one Republican called it radical -- but it was not happily received. The solution, of course, is to design an American program for prosperity, because you can solve these entitlement problems with a growing economy. We need a tremendous program of investment, and investment comes from savings. When you pay savers, middle-income professionals, and working people 0 percent at the bank, you are not going to encourage them to save. Then we are left with a bank cycle of debt, leverage, boom, panic, and bust." To read more and to sign up for The Gold Standard Now's free, noncommercial, weekly report, "Prosperity through Gold," please visit: http://www.thegoldstandardnow.org/gata
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| Posted: 05 Sep 2011 12:35 PM PDT Courtesy of ZeroHedge Any time a major bank releases a report saying a given course of action is too costly, too prohibitive, too blonde, or simply too impossible, it is nearly guaranteed that that is precisely the course of action about to be undertaken. Which is why all non-euro skeptics are advised to shield their [...] 
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| The Meek Shall Inherit The Earth Posted: 05 Sep 2011 12:30 PM PDT by Silver Shield, Dont-Tread-On.Me:
I use the line of, "there are only two different people in this world; those that want to be left alone and those that won't leave you alone." The people I have spoken to so far, are some of the best, most caring individuals I have spoken to. They are trying their best to not only save their families from the mathematically inevitable collapse of the dollar, but also to be a blessing on to others who either can't or won't prepare for this event.
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| Posted: 05 Sep 2011 12:15 PM PDT Any time a major bank releases a report saying a given course of action is too costly, too prohibitive, too blonde, or simply too impossible, it is nearly guaranteed that that is precisely the course of action about to be undertaken. Which is why all non-euro skeptics are advised to shield their eyes and look away from the just released report by UBS (of surging 3 Month USD Libor rate fame) titled "Euro Break Up - The Consequences." UBS conveniently sets up the straw man as follows: "Under the current structure and with the current membership, the Euro does not work. Either the current structure will have to change, or the current membership will have to change." So far so good. Yet where it gets scary is when UBS quantifies the actual opportunity cost to one or more countries leaving the Euro. Notably Germany. "Were a stronger country such as Germany to leave the Euro, the consequences would include corporate default, recapitalisation of the banking system and collapse of international trade. If Germany were to leave, we believe the cost to be around EUR6,000 to EUR8,000 for every German adult and child in the first year, and a range of EUR3,500 to EUR4,500 per person per year thereafter. That is the equivalent of 20% to 25% of GDP in the first year. " It also would mean the end of UBS, but we digress. Where it gets even more scary is when UBS, like many other banks to come, succumbs to the Mutual Assured Destruction trope made so popular by ole' Hank Paulson : "The economic cost is, in many ways, the least of the concerns investors should have about a break-up. Fragmentation of the Euro would incur political costs. Europe's "soft power" influence internationally would cease (as the concept of "Europe" as an integrated polity becomes meaningless). It is also worth observing that almost no modern fiat currency monetary unions have broken up without some form of authoritarian or military government, or civil war." So you see: save the euro for the children, so we can avoid all out war (and UBS can continue to exist). The scariest thing, however, by far, is that for this report to have been issued, it means that Germany is now actively considering dumping the euro. Executive summary:
A little more on that particularly troubling last point:
As for what happens if UBS, and the Euro Unionists lose the fight for the euro:
Alas, this will be the final outcome. Unfortunately trillions more in taxpayer capital will be lost before we get there. In the meantime, enjoy as UBS just unwittingly announced the final countdown for the EUR.
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| Posted: 05 Sep 2011 10:11 AM PDT Having twiddled thumbs all day, equity futures just reopened with a modest drop - extending losses from the overnight session. Volume handily picked up from this morning as we note Gold dribbling along at $1900 and a small rise in the Dollar Index. Swissy seems modestly bid - especially relative to EUR (which is holding below 1.41 for now against the USD).
We are also seeing the first runs come through in credit markets and it is not too pretty. Not quite as ugly as Europe but IG is 4.5bps wider at 125bps and HY 7bps wider at 690bps (though 3Y HY is 20bps wider at 553bps). Obviously, financials are the hardest hit so far with Goldman Sachs (+12 to 235bps) and Merrill Lynch (+19 to 389bps) the standouts in a quiet late session.
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| Posted: 05 Sep 2011 09:05 AM PDT Gold May Top $6,000, Silver $600: Asset Manager
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| The fireworks are just beginning!!! Posted: 05 Sep 2011 08:11 AM PDT “Max got me into Gold at $400.”
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| Guest Post: Unseemly Scramble For Libya’s Post-Gaddafi Oil Assets Underway Posted: 05 Sep 2011 07:51 AM PDT Submitted by John C.K. Daly Unseemly Scramble for Libya's Post-Gaddafi Oil Assets Underway While NATO members, led by France, piously proclaimed at the onset of their military offensive in Libya that their concerns were solely humanitarian, a covert tussle to gain a commanding lead in developing the country's energy riches in light of Colonel Gaddafi's departure is well underway. The Libyan economy depends primarily upon revenues from the oil sector, which contribute about 95 percent of export earnings, 25 percent of GDP, and 80 percent of government revenue. Prior to the outbreak of conflict, Libya was exporting about 1.3-1.4 million barrels per day from production estimated at roughly 1.79 million barrels per day, of which approximately 280,000 barrels per day were indigenously consumed. But analysts believe that with reconstruction Libya could soon be exporting 1.6 million barrels per day of high-quality, light crude. But current production is the proverbial mere drop in the bucket. Libya has the largest proven oil reserves in Africa with 42 billion barrels of oil and over 1.3 trillion cubic meters of natural gas. Causing oil company executives from Houston to Beijing to drool on their Gucci loafers, only 25 percent of Libya's territory has been explored to date for hydrocarbons. Libya is already Europe's single largest oil supplier, the second largest oil producer in Africa and the continent's fourth largest natural gas supplier and already dominates the Southern Mediterranean's petroleum sector. According to the Libyan National Oil Corporation (NOC), more than 50 international oil companies are already present in the Libyan market. So, peering into Libya's future, who's actually ahead? France, apparently. On 3 April a letter was allegedly sent by Libya's National Transitional Council (NTC) to a coalition partner, Qatari Emir Sheikh Hamad bin Khalifa Al Thani, which mentioned that France would take "35 percent of crude oil...in exchange for its total and permanent support" of the NTC. France's Liberation daily reported on Thursday that it had a copy of the letter, which stated that the NTC's Information Minister Mahmoud Shammam, would negotiate the deal with France. In 2010 France was the second purchaser of Libyan oil after Italy, with over 15 percent of its "black gold" imported from Tripoli. Zut alors! The number one National Transition Council, Moustapha Abdeljalil recently reported that the States would be rewarded" according to support "given to the insurgents. While NTC head Mustafa Abdel Jalil has not hidden the fact that the NTC would assign a higher priority for reconstruction and the allocation of oil contracts to countries that supported their uprising, remarking that nations would be rewarded "according to the support" given to the insurgents, the NTC's UK representative, Guma al-Gamaty, said that future oil contracts would be granted "on the basis of merit, not patronage. The contracts will be concluded in a transparent manner. " French Foreign Minister Alain Juppe solemnly denied during a radio interview any knowledge of a "formal" or specific deal but brightly added that it would be "logical" for countries like France, which helped the NTC in its struggle against Gaddafi, to take part in reconstruction. French President Nicholas Sarkozy was the major European advocate for armed intervention in Libya and his administration was the first officially to recognize the NTC as "the sole, legitimate representative of the Libyan people" and the country's sole governmental authority, as well as lobbying other nations to recognize the NTC. Seeking a share of "la gloire," France was also the first state to commence attacks on 19 March against Gaddafi's armed forces in Benghazi and along with fellow NATO member Britain, have since provided the majority of the military equipment and personnel used during NATO's operations in Libya. Going into grey areas of international law in its eagerness to oust Gaddafi France also supplied some weaponry to opposition forces in Libya, a move that came under harsh criticism because of the total arms embargo imposed by the UN Security Council on arms deliveries to any side in the conflict. NTC's Paris-based envoy Mansour Sayf al-Nasr denied that such a letter had been sent or that any such pledge had been given. But no one was backpedalling more furiously than Information Minister Shammam, who intoned that such an arrangement was unthinkable. "It's a joke. It's false," Shammam said. Well, if you cannot believe an Information Minister, who can you trust? Sleazy journalists? It will certainly be interesting to see how the issue plays out in the days ahead, and if France does indeed get it 35 percent cut of the loot, which at present production rates, would average about 500,000 barrels per day.
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| Where’s Our Oil Price Collapse? Posted: 05 Sep 2011 07:47 AM PDT James Quinn Make no mistake about it, without plentiful, cheap, and easy to access oil, the United States of America would descend into chaos and collapse. The fantasies painted by "green" energy dreamers only serve to divert the attention of the non critical thinking masses from the fact our sprawling suburban hyper technological society would come to a grinding halt in a matter of days without the 18 to 19 million barrels per day needed to run this ridiculous reality show. Delusional Americans think the steaks, hot dogs and pomegranates in their grocery stores magically appear on the shelves, the thirty electronic gadgets that rule their lives are created out of thin air by elves and the gasoline they pump into their mammoth SUVs is their God given right. The situation was already critical in 2005 when the Hirsch Report concluded: The peaking of world oil production presents the U.S. and the world with an unprecedented risk management problem. As peaking is approached, liquid fuel prices and price volatility will increase dramatically, and, without timely mitigation, the economic, social, and political costs will be unprecedented. Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking." We were warned. We failed to heed the warnings. If we had begun making the dramatic changes to our society 5 to 10 years ago, we may have been able to partially alleviate the pain and suffering ahead. Instead we spent our national treasure fighting Wars on Terror and bailing out criminal bankers. Converting truck and bus fleets to natural gas; expanding the use of safe nuclear power; utilizing wind, geothermal, and solar where economically feasible; buying more fuel efficient vehicles; and creating more localized communities supported by light rail with easy access to bike and walking options, would have allowed a more gradual shift to a less energy intensive society. We've done nothing to prepare for the onset of peak oil. Until this foreseeable crisis hits with its full force like a Category 5 hurricane, Americans will continue to fill up their M1 tank sized, leased SUVs, tweet about Lady Gaga's latest stunt, and tune in to this week's episode of Jersey Shore. Meanwhile, economic stagnation, catastrophe and wars for oil are darkening the skies on our horizon. 
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| Bloomberg Ignores Major Stock Market Fall in Europe Posted: 05 Sep 2011 07:17 AM PDT
By DoctoRx of the Daily Capitalist, on September 5th, 2011 Stock markets fell very hard in Europe today, but if even Bloomberg.com doesn't mention it, does that mean it did not happen or does not matter? The Stoxx 50 index was down over 5%, as was the German DAX. Yet the "Top News" headlines on Bloomberg as I write this are, in order: Obama Addresses Union Labor Day Rally; Darwin Effect Cuts Photo-Voltaic Panel Prices; Articles on Harvard v Cambridge and how the strong NZ dollar is straining the finances of attendees at a world rugby tournament there; An op-ed specifically addressed to Rick Perry expressing the POV that Social Security is not a Ponzi scheme; (FINALLY) European stocks drop on Merkel Election Loss (Later, there is a headline announcing the Italian bank stocks plunged. No mention that the Italian stock market indices also fell about 5%.) This neglect of a gigantic fall in the price of corporate Europe's assets and earnings power is a bit scary. If there is any wonder as to why the alternative blogosphere is gaining readers by leaps and bounds, today's Bloomberg shows why. The mass media in the U. S. decidedly accentuates the positive. We at The Daily Capitalist prefer to instead accentuate the facts, and then add interpretation to them. As we see it, the question of whether the U. S. has entered a new recession is the wrong question. We believe that the one that officially began in 2007 never ended. Inventory shifts, one-off government programs, random fluctuations of economic activity, mismeasurement of the inflation adjustment to measured GDP, etc., all came into play. I would add that increasingly this year has the smell of 1974, 1978-9, 1998, and even perhaps 2008. Of course a great deal of what is now happening relates back to the governmental and Fed decisions of 2008, setting a bipartisan course followed by the Obama administration in 2009. To now see the government, via the FHFA, suing the same banks it and the Fed supported so vigorously in 2008 and thereafter looks discordant. Couldn't there have been less support to reach the same result more rapidly and more smoothly? In any case, the JPMorgan Chase analyst's recent call for gold to hit $2500/ounce by - is, very unfortunately and quite amazingly, looking more plausible. As is a 1.5% ten year bond yield.
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I spent all of last week doing my final Strategy Sessions, before I start on my two final projects. I was overwhelmed by the response and closed it down early when I had 55 Strategy Sessions lined up from all over the world. I am more than half way through them and I am consistently amazed at the quality and diversity of the people. We had people from Korea, Luxembourg, Ireland, Bahrain, Belarus, and all over the U.S. The commonalities were striking to me, in that we all spoke the same language of freedom.
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