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- Stunning Plunge in COMEX Commercial Silver Net Short Positions
- Physical Silver Shortage to Follow Paper Selloff
- Hedge Fund Action Doesn’t Change Fundamentals
- Ron Paul vs. Peter Joseph – Financial Protest Songs to End Your Week
- States to Financially Break Away from Federal Government – Utah Monetary Declaration
- Gold Steadies, Inflation Rises in Eurozone, Stagflation Beckons
- Hilarious video shows the media is still completely clueless about gold
- How the TSA could be banished by the end of the year
- Reports say billionaire George Soros has dumped all of his gold
- Is the Noose Tightening Around Gold?
- Physical Silver Shortages Growing & Premiums Rising
- World Is Watching Europe And Greece. Pay Attention To China
- Silver Shortages Growing and Premiums Rising
- Seth Lipsky: Ron Paul hoists the flag of Hayek and free competition in currency
- Premiums for gold bars jump to highest since February
- Silver shortages growing and premiums rising: Pat Heller
- Silver to go up hundreds of percent from here: Robin Griffiths
- German bailout vote is 'too little, too late'
- WATCH: Rest Of World Recognizes GOLD is on SALE
- Scott Gardner: Europe's Debt Crisis and Its Effect on Gold
- Bank Crisis and the Effect on the Gold, Silver prices
- Silver price under pressure
- Second Largest Bull Market Correction for Silver
- Lower Lows in the Cat-Like Real Estate Market
- Why Real Investors Love Political Incompetence
- Bulls Go Backwards
- The Discovery of Gold in California by Gen. J.A. Sutter
- Gold Is The Cure For The Job-Drain
- Real bills and employment
- TA on the paper silver chart
| Stunning Plunge in COMEX Commercial Silver Net Short Positions Posted: 30 Sep 2011 06:57 AM PDT The CFTC just released its commitments of traders (COT) report at 15:30 ET for trader's positions as of the close on Tuesday, September 27 and the data show a stunning drop in the large commercial net short positions in both gold and in silver futures.
For example, as silver fell $7.88 or 19.8% Tues/Tues, from $39.76 to $31.88, traders classed by the CFTC as "commercial" reduced their collective net short positioning (LCNS) by an extremely large 16,446 contracts to show 24,262 contracts net short. This, while the open interest fell by 10,089 to 102,014 open.
We will have more commentary on this unusually large reduction in commercial net short positioning, including a 30,945-contract reduction in the LCNS for gold futures, in the technical graph comments for Vultures, which we intend to complete by the usual time this weekend. That is all for now, but there is more to come. |
| Physical Silver Shortage to Follow Paper Selloff Posted: 30 Sep 2011 04:25 AM PDT Don't know what to think about silver....see what Dr. Jeff Lewis of Silver-Coin-Investor has to say. |
| Hedge Fund Action Doesn’t Change Fundamentals Posted: 30 Sep 2011 03:26 AM PDT Silver investors should know that such a change in inflation is not one that is transitory, but rather an immediate reaction. When the market reaches equilibrium, a wave of borrowing will happen almost immediately. There is no stopping a flood of credit of this magnitude. Central banks, especially the Federal Reserve, would have to entice banks to keep assets in reserve. The Fed can enact such a policy only by agreeing to pay a higher rate on reserves held at the Fed, which would only compound the growth in money supply. |
| Ron Paul vs. Peter Joseph – Financial Protest Songs to End Your Week Posted: 30 Sep 2011 03:15 AM PDT First off is the latest work from the brilliant minds at Juice Media. Rap News anchor "Robert Foster" takes us through the key issues facing our economic system, channeling the views of both Ron Paul and Peter Joseph, two of the minds I most align with regarding potential solutions. It is funny and entertaining, [...] |
| States to Financially Break Away from Federal Government – Utah Monetary Declaration Posted: 30 Sep 2011 02:51 AM PDT Below is an important message from Ron Hera, who recently attended the Utah Monetary Summit in Salt Lake City, Utah. The dollar may seem strong and precious metals weak in the short-term, but this is providing an excellent opportunity to exit the fiat currency and get your hands on real money. Perhaps the last [...] |
| Gold Steadies, Inflation Rises in Eurozone, Stagflation Beckons Posted: 30 Sep 2011 01:31 AM PDT |
| Hilarious video shows the media is still completely clueless about gold Posted: 30 Sep 2011 01:13 AM PDT From SHTFplan: We have no words to express the sheer lunacy of the following report: "There's something else happening here. Some investors are not confident with what gold is backed by, or if it's backed by anything at all, as compared to something like... Read full article (with video)... More entertainment: Today's entertainment: The E-Trade baby gets smoked The Daily Show rips Obama on "transparency" and new campaign ads Drunken Ben Bernanke tells everyone at neighborhood bar how [expletive] the U.S. economy really is |
| How the TSA could be banished by the end of the year Posted: 30 Sep 2011 01:08 AM PDT From LewRockwell.com: I've had numerous responses to articles I've written asking me, "OK, so what’s the next step?" I respect your intelligence, so I won't say… voting. ... So, what can we do? There is still one mechanism with real teeth that we can use to effect real change – if we have the sense to use it: The market. More specifically, our preferences (for liberty) as expressed via our actions – our decisions to buy or not – in the marketplace. It is a force with more locked-up potential in it than an electoral juggernaut. A means by which the country could be transformed – peacefully – not in a generation, but in a matter of weeks or months. Consider two examples I've written about recently... Read full article... More Cruxallaneous: This could be the best Doug Casey interview EVER This popular American city is becoming a police state Don't worry about the fall in gold... This is what you should be watching instead |
| Reports say billionaire George Soros has dumped all of his gold Posted: 30 Sep 2011 01:03 AM PDT From Forbes: Investors can't seem to get enough of stories talking about what this or that famous investor is doing with his or her portfolio. In the latest example, news that George Soros has liquidated his gold holdings has some investors and commentators wondering whether the markets are looking at the end of an impressive run in gold. Whether Soros is right or wrong with this latest move, investors ought to consider some of the reasons to reject or copy his move... Read full article... More on gold: Jim Rogers: The gold selloff is not over yet A major gold correction has officially begun Gold WARNING: France bans cash purchases of gold and silver over $600 |
| Is the Noose Tightening Around Gold? Posted: 29 Sep 2011 10:07 PM PDT From WealthCycles:
Read more @ wealthcycles.com |
| Physical Silver Shortages Growing & Premiums Rising Posted: 29 Sep 2011 10:01 PM PDT by Patrick A. Heller:
The fact that US 90% Silver Coin is now worth more than intrinsic value on the wholesale market could result in quickly rising spot prices. When 90% Silver Coin is trading wholesale for 1-2% below silver value, refiners can profitably melt down the coins and refine the silver. This effectively expands the supply of available physical silver. Now that refiners no longer have this source of supply available, because the 90% Silver Coin is costing them more for the silver than the price at which they are selling their refined products, you could see a rapid physical supply squeeze. If the current physical silver buying surge continues, you could see a significant recovery in the spot price. Read more @ coinupdate.com |
| World Is Watching Europe And Greece. Pay Attention To China Posted: 29 Sep 2011 09:10 PM PDT China's consumption rate has fallen to 36% of GDP from 48% in the late 1990s. Academic libraries are bursting with PhD papers trying to explain why. -Ambrose Evan-Pritchard The Telegraph 9-18-11 -Photo Wikopedia Can China escape as world's debt crisis reaches Act III? When America became the first casualty of the global credit bubble in 2007, Europe's political elites thought it had nothing to do with them. Facts are simple. China dodged the Great Contraction of 2008-2009 by unleashing credit on a massive scale. "Even after Lehman and AIG collapsed a year later — and Europe's economy crashed into slump — it remained an article of faith in Berlin, Paris, and Rome that this was just fall-out from the Anglo-Saxon casino. Few understood that the 'China Effect' had engendered credit bubbles everywhere, and that Europe's variant was even more pernicious because Euro-banks were more leveraged, with much greater liabilities, and the structure of EMU concentrated the damage on weaker states with no policy defense against sovereign collapse." "US Treasury Secretary Tim Geithner must have felt a twinge … as he exhorted EU finance ministers in Poland to rescue their banks or face "catastrophe". The Germans and Austrians barked back at him, of course, but at least debate is joined. Europe cannot blame America any longer, and if the US really were to slash spending right now — as Germany's finance minister seems to want, like the disastrous Bruning, circa 1931 — EMU would be in even deeper trouble." "In my view, Germany's austerity nihilism will precipitate a dramatic policy shift by the US over coming months. The risk — or solution — is that Washington will write-off Europe as irretrievably hopeless and re-order the global landscape. The US will not let free-riders exploit is its precious stimulus forever. It may seek to form a global growth bloc, open only to stimulators. And woe betide Germany. But that is a column for another day." "By the "China Effect," I mean the Asian trade tsunami that flooded Western markets and deflated the price of everything from shoes and clothes, to washing machines and solar panels. This seduced Western central banks into running ultra-loose monetary policies for twenty years, and disguised the build-up of dangerous asset bubbles. It was coupled with Asia's "Savings Glut", as Ben Bernanke calls it. The rising powers accumulated $10 trillion of reserves, either because they were holding down currencies to gain trade share, or because their economic and social structure was geared towards mercantilism and excess output." "China's consumption rate has fallen to 36% of GDP from 48% in the late 1990s. Academic libraries are bursting with PhD papers trying to explain why. Some posit the welfare theory, arguing that aging citizens must save for a future with almost no pension or health provision; others that China has frantically leveraged an infrastructure and manufacturing boom to buy time and contain the wrath of 200m migrant workers." "Whatever the mix: there is simply too much global investment, and too little consumption. The system is out of joint. It does not feel like the 1930s because we are richer in the West, with a better safety net, and emergency stimulus has so far cushioned the effects, but Bertil Ohlin, John Maynard Keynes, and Irving Fisher would find it unnervingly familiar." "The Savings Glut flooded global bond markets, especially the EMU markets as central banks rotated into Euros. Hence the collapse in yields during the long bubble. Pension funds were forced to search for better return in ever riskier countries and assets to match their liablities." This is why Greece was able to borrow for ten years at 26 basis points over Bunds, and Spain at four points of spread at the end of the boom, and why Italy's €1.8 trillion public debt did not seem to be a problem. It hid all sins. Capital was hanging from the lowest branches, almost free for all. America took it, Britain took it, Iceland took it (a lot), and Euroland took it." "Yet China itself must ultimately be a victim of this warped structure as well, and that is where we are in late 2011. Act III of the global denouement is unfolding. The world will have to lance the debt boils of Asia as well before clearing the way for another cycle of global growth." "Zhu Min, the IMF's deputy chief and a former Chinese official, said loans had jumped from 100% of GDP before the crisis to around 200% today — if you include off-books financing from letters of credits, trusts, and such like. To put this in perspective, a study by Fitch Ratings found that credit in America rose by just 42% of GDP in the five-year period before the housing bubble popped. It rose by 45% of GDP in Japan from before the Nikkei cracked in 1990, and 47% before the Korean crisis in 1998." "Home construction is running at 10pc of GDP, about the same as Spain in the`burbuja' of late 2006, and much higher than in either Korea or Japan at any point during their catch-up Tiger phases." "China's banking system is the largest, fastest-growing, but most thinly capitalized among emerging markets. Such a rapid run-up in leverage is a sign that the incremental return on credit has declined," said Fitch. The economic boost from each extra Yuan of credit collapsed from 0.75% to 0.18% during the crisis and has yet to recover. My impression from China's "Summer Davos" in Dalian is that Beijing's elite is less deluded about the risks than Europe's leaders were for so long. "The whole world needs to lower its expectations from China," said Lee Kaifu, the country's software mogul. "There is an even bigger threat than a global double-dip, and that is a prolonged recession with no growth and very limited policies to fight it. We are already in it." "Cheng Siwei, head of Beijing's International Finance Forum and a former vice-president of the Communist Party's Standing Comittee, said China is entering a "very tough period" as growth runs into the inflation buffers, paralysing the central bank. "The inflation rate and the growth rate are conflicting with each other: it is very troubling," he said. China faces the sort of the incipient stagflation that hit the West in the 1970s." "Matters have reached the point that even a light tap on the brakes by China's central bank — through credit curbs (deposit rates are still minus 3% in real terms) — is already threatening a hard-landing. Dr. Cheng said local authorities had built up $1.7 trillion in debt, mostly using arms-length finance vehicles. This is coming back to haunt. "The tightening policy is creating a lot of difficulties and causing defaults. This is our version of subprime in the US, and the government is taking this very seriously," he said." "Whether the housing market will also set-off a chain of defaults is the great question dividing analysts. "Decidedly bubbly," is the IMF's politically-correct view. Its own data shows that price to incomes ratios range from 16 to 22 in the Eastern cities of Shenzen, Shanghai, Beijing, and Tianjin, multiples of the worst extremes in the very tame US boom. Caixin Magazine reports that Guangzhou R&F Properties is slashing prices by 20%, and other big developers may soon follow." "China has not abolished economic gravity. Its policy of Yuan suppression against the Dollar and Euro has been impossible to sterilize, leading to an imported credit bubble of epic proportions. Its export-led strategy has left it with a deformed economy that relies on perma-demand from exhausted debtors in America and Europe. As China premier Wen Jiabao said in Dalian, "China's development is not yet balanced, coordinated and sustainable." The next five-year plan is a breakneck switch towards a domestic growth. Bravo, but awfully late." "China is acutely vulnerable to the second leg of depression in the West — should that occur — and cannot conjure a second rabbit out of the hat. This will not stop the rise of China as the great force of 21st Century, any more than America's jolting upset in 1930 stopped US ascendancy. Yet, economic history has taught us two iron-clad rules. There is no escape from credit hangovers, and surplus trading powers suffer just as much as deficit states — if not more –once Kondratieff slumps turn really serious." -Ambrose Evans-Pritchard The Telegraph 9-18-11 Trader Tracks Situational Alert Wednesday 8am PST 9-21-11: Politics and markets are standing still frozen in time. Washington is floundering with zero leadership and is grasping at media straws. Europe is cornered with no coherent plan available to save their economies and resolve the credit crisis. I just went through a dozen charts and they are showing two things: (1) Precious metals and the shares are flat but the primary bias and trend is up. A techie can see this even though prices are showing us nothing for today. (2) The weak sister markets show a sell bias but those prices are mostly flat too. So what's next? I think we are on the cusp of something big happening in Europe, Asia or the USA that can either terrorize investors and traders or create new buying and selling opportunities along the lines of some kind of alleged normalcy. It could go either way. Intra-bank lending in Europe is stalled. Lloyds of London has pulled massive deposits out of European banks as they fear disaster. Trichet in one final Hail Mary pass today said he wished the sales of Euro-bonds could transpire to save the grand Euro-land experiment. Trichet has no collateral and smarter heads are saying no. Europe is gasping for its last economic breath as there is no solution and deadlines are nigh. As the Euro malaise continues, fear in Europe is deepening as intelligent people can see what is coming. The last time this happened in 2008, European banks were instructed by their officers not to lend to NYC global banks as the risk was too high. Now, we suspect the shoe is on the other foot. If you ran a big NYC bank would you offer large short term loans to allegedly solid European banks and bankers? I think not and this is puckering-up the lines of larger capital trading among most global banks. Liquidity is tightening quickly. China made overtures to help Europe but backed away when no solid collateral was offered. Next, with this scary stuff building, we are near the worst trading cycle of the year from 9-26 through the first two weeks of October. Please be very careful out there with any new trades or investments. If you are tempted to buy, or sell something in a new trade, first ask the big question: How do I get out of this if something drastic breaks and trading rules go out of control, or cannot be managed? What if Europe has open not the current hidden bank runs and they declare a bank holiday? What would the reaction be in NYC and, or Washington? Our futures traders are covered if they have used our spread strategies. Owners of Junior Shares with larger profits can exit, sell half or hold knowing we can get a brief (I think) hit on the head. Intermediate companies with share prices above $5-$10 listed on the bigger volume exchanges: (1) You can exit and buy in later (2) you can tighten your stops and stay in (3) you can sell half and keep half. (4) If you are sitting on very large profits I would recommend an exit of at least part if not all of the trade. Holders of bullion keep holding; do not sell. We see metals strength coming and this offers a chance to exit. Our current broader market forecast for the next six weeks is a normal correction of (5-10%) followed by a new buying spree after October 31, 2011. In the intermediate view, (12-18 months) fall of 2012 could be the larger crash date with the Nasdaq leading the parade down the bowl. The Nazz is loaded with over-priced companies particularly in the social networking sector and coupon sectors. Keep in mind NYC let the 2000 Nazz collapse to save the other exchanges. I think there is no love lost between some of these exchanges. Oil and energy is holding firm and should rise with precious metals on new inflation. The US Dollar is resisting at 77.50. If the Euro sells toward 130 the US Dollar is going to 80.00, the old time magnet number. Keep in mind we all have three decisions (1) Yes (2) No (3) Do Nothing. Please use common sense and do not worry about making money but controlling risk. Doug Casey's Daily Dispatch headline 9-20-11 is "Getting rich from gold stocks: Patience." This is very good advice. Our turn is coming just wait please. -Traderrog         This posting includes an audio/video/photo media file: Download Now |
| Silver Shortages Growing and Premiums Rising Posted: 29 Sep 2011 09:09 PM PDT ¤ Yesterday in Gold and SilverGold got sold off almost $30 in the first three hours of trading on Thursday morning in the Far East. From that low, just before 9:00 a.m. Hong Kong time, the gold price rallied right up until minutes after 9:00 a.m. in London...and that was its high of the day. The gold price got sold off from there, coming close to $1,600 spot, but not penetrating that price to the downside...and then spent the rest of the day within ten dollars of $1,615 spot...closing the New York trading session at $1,615.90 spot...up $6.20 on the day. Net volume was in the area of 180,000 contracts.
Silver's price moves were very similar to gold's...with virtually all the price change points coming at precisely the same moments in time. Every attempt by silver to get into a rally mode anywhere on Planet Earth yesterday, ran into a willing seller...or it could have been the smaller commercial traders selling more of their long positions and taking profits. The high [around $31.40 spot] of the day, like gold, came minutes after 9:00 a.m. in London...and the low [around $29.60 spot] was around 12:30 p.m. in London as well. A late silver fix, perhaps? From there, silver was up a dollar and then down a dollar for the rest of the day...closing the New York electronic trading session up 74 cents. Net volume was around 46,000 contracts.
For the second day in a row, the gold price got sold off at the open of the equity markets in New York at 9:30 a.m. The stocks gapped up about 2 percent at the open, but ran into selling pressure immediately. For the most part, the shares followed the gold price around almost like a shadow, with the HUI finishing up 0.73% on the day.
The silver stocks, both small and large cap, were a mixed bag yesterday...and only one of the stocks that make up Nick Laird's Silver Sentiment Index did very well for itself...and the index was only up 0.19%. I was expecting somewhat better considering the fact that silver was up 74 cents on the day.
(Click on image to enlarge) The CME's Daily Delivery Report showed that only one lonely silver contract was posted for delivery today, as the September delivery month goes off the board. Today is First Notice Day for the October delivery month...and it was a busy one. In gold, a total of 2,781 contracts were posted for delivery on Monday, October 3rd. The big short/issuers were Deutsche Bank and HSBC who delivered 2,760 contracts between them. The big longs/stoppers were JPMorgan in its client account, with 2,898 contracts to be received...and in distant second place was Merrill with 553 contracts. In silver, there were 450 contracts posted for delivery on Monday. The big short/issuer was the Bank of Nova Scotia with 443 contracts...and the two biggest longs/stoppers were JPMorgan in its client account, along with Jefferies. On Monday they will take delivery of 250...and 122 contracts respectively. This Issuers and Stoppers Report is worth spending a bit of time on...and the link is here. There was a substantial withdrawal from GLD, as 321,171 troy ounces were removed...and 730,143 ounces were withdrawn from SLV. The U.S. Mint had another sales report. They sold another 4,500 ounces of gold eagles...500 one-ounce 24K gold buffaloes...and 275,000 silver eagles. Month-to-date gold eagle sales are 86,500 ounces...along with 12,500 gold buffaloes...and a whopping 4,000,500 silver eagles. There's a good chance we may get another sales report today or Monday to round out the month of September. There wasn't a lot of activity over at the Comex-approved depositories on Wednesday. They reported taking in 335,236 troy ounces of silver...and shipped a very tiny 18,040 ounces out the door. Most the action, such as it was, was over at Brink's, Inc...and the link is here. Here's one of many charts that Nick Laird sent me last night. This is the chart of 1-ounce silver eagle premiums over the spot price going back three years.
(Click on image to enlarge) In silver, we are so far below the 200-day moving average that it's uncertain as to how long it will take before we get back above it. Asian premiums for gold bars jump to highest since February. Silver to go up hundreds of percent from here: Robin Griffiths. Negative interest rates from short to long will support metals, Michael Pento says. ¤ Critical ReadsSubscribeCFTC Will Face Scrutiny Over Speculation Curbs at Senate Panel on Oct. 6The U.S. Commodity Futures Trading Commission, which has yet to complete Dodd-Frank Act limits on excessive speculation, will face scrutiny about the trading curbs at an Oct. 6th hearing led by Senator Carl Levin. CFTC chairman Gary Gensler will testify at the hearing of the Permanent Subcommittee on Investigations, according to a statement released by Levin's office today. The CFTC, after delaying consideration in September, delayed a final vote on the regulations until an Oct. 18th Washington meeting, Steve Adamske, the agency's spokesman, said yesterday. The rule has among the most contentious stemming from Dodd-Frank, spurring more than 13,000 comments from supporters such as Delta Air Lines Inc....and opponents including Barclays Capital. The vast majority of those 13,000 comments came from silver investors recommending a position limit of 1,500 contracts in silver. I thank reader Howard Brown for sending me this Bloomberg story from Wednesday...and the link is here.  JPMorgan's Dimon's Aggressive Style May Hurt Bank CauseI ran a Globe and Mail story about this altercation between JPMorgan's CEO Jamie Dimon and Canada's central bank chief, Mark Carney, in this column yesterday. But this cnbc.com story about this incident is far more detailed. Masters of the universe are not always so masterful after all. JPMorgan Chase Chief Executive Jamie Dimon's squabble with the head of the Bank of Canada over bank regulation managed to achieve only one thing — angering the central banker. Once viewed as a star for helping the U.S. government prop up the now-defunct Bear Stearns during the 2008 financial crisis, Dimon is in danger of becoming a pariah among global regulators. At a meeting last week between the world's most powerful bankers and Bank of Canada Governor Mark Carney, Dimon tried to tell the central banker that banks were suffering under the weight of all the new bank rules. But his aggression drove a red-faced and visibly angry Carney out of the room, according to people familiar with the encounter. I thank West Virginia reader Elliot Simon for sending me this cnbc.com story...and the link is here.  Seth Lipsky: Ron Paul hoists the flag of Hayek and free competition in currencyNew York Sun editor Seth Lipsky today recalls a meeting with Austrian school economist Friedrich Hayek and his advocacy of competitive currencies, a position recently put into federal legislation by U.S. Rep. Ron Paul, a candidate for the Republican presidential nomination. Paul's Free Competition in Currency Act, Lipsky notes, would bear heavily on the absurd conviction in federal court of Liberty Dollar founder Bernard von NotHaus. Lipsky's column is headlined "Ron Paul, Upping the Ante in His Campaign for Liberty, Hoists the Flag of Hayek". you can find it posted at the New York Sun's Internet site. I thank Chris Powell for wordsmithing the above introduction...and the link is here.  Merkel Breathes Sigh of Relief: German Parliament Passes Euro Fund ExpansionChancellor Angela Merkel got the majority she needed on Thursday as German parliament passed the expansion of the euro backstop fund, the EFSF. With fewer conservative renegades than feared, Merkel can breathe a sigh of relief. But with more difficult decisions approaching, the respite may not last. The expansion of the EFSF still faces some significant hurdles, with several countries left to vote. Most significantly, Slovakia has threatened to reject the expansion -- a move which, given the need for unanimous approval, could torpedo the enlargement of the fund. France passed the expansion several weeks ago and both Finland and Austria passed it earlier this week. This story was posted on the German website spiegel.de late yesterday...and is courtesy of Roy Stephens. The link is here.  German bailout vote is 'too little, too late'Germany's Bundestag has voted overwhelmingly to boost the scope of the EU's rescue fund but implicitly capped its firepower at €440bn, leaving it no clearer whether Europe has the means to halt debt contagion to Italy and Spain. Chancellor Angela Merkel won her "own majority" for the bill, narrowly averting the collapse of her government, but only after pledging that there was no grand plan committing Germany to vast and unlimited liabilities. Horst Seehofer, leader of Bavaria's Social Christians CSU, said his party would go "this far, and no further", insisting any expansion of the rescue machinery was out of the question. "The financial markets are beginning to ask whether Germans can afford all this help. We must not risk the creditworthiness of the German state," he said. This Ambrose Evans-Pritchard offering was posted in The Telegraph just before midnight last night. It's another Roy Stephens offering...and the link is here.  Peter Oborne 'Idiot' Comments Prompts EU Spokesman To Storm Off NewsnightAn EU Commission spokesman has stormed out of a Newsnight panel discussion on the Eurozone, after the Daily Telegraph columnist Peter Oborne repeatedly referred to him as an idiot. Osborne doesn't pull any punches here...and this 5:09 youtube.com video sent to me by reader 'David in California' is a must watch. The link is here.  China ruffles Europe's feathersThe head of the country's sovereign wealth fund could hardly have been clearer. "We in China are concerned about the unravelling of the situation in the region," Jin Liqun, chairman of China Investment Corporation – which has $300bn to play with. "China cannot be expected to buy into high risk in eurozone without a clear picture of debt work-out programmes." "Sorry if I have ruffled feathers," he said, not looking remotely sorry. "Over time, economies in the EU will be out of woods. We're optimistic for the outlook," he allowed. However, nothing can be achieve unless EMU states secure the popular consent of their citizens for austerity policies. This is another Ambrose Evans-Pritchard piece from yesterday's edition of The Telegraph..and another Roy Stephens offering. The link is here. Seth Lipsky: Ron Paul hoists the flag of Hayek and free competition in currency Posted: 29 Sep 2011 09:09 PM PDT  New York Sun editor Seth Lipsky today recalls a meeting with Austrian school economist Friedrich Hayek and his advocacy of competitive currencies, a position recently put into federal legislation by U.S. Rep. Ron Paul, a candidate for the Republican presidential nomination. Paul's Free Competition in Currency Act, Lipsky notes, would bear heavily on the absurd conviction in federal court of Liberty Dollar founder Bernard von NotHaus. Lipsky's column is headlined "Ron Paul, Upping the Ante in His Campaign for Liberty, Hoists the Flag of Hayek". you can find it posted at the New York Sun's Internet site. |
| Premiums for gold bars jump to highest since February Posted: 29 Sep 2011 09:09 PM PDT  Here's a short Reuters story filed from Singapore that was posted over at the India Times on Wednesday. Premiums for gold bars jumped to their highest level since at least February after a drop in gold prices spurred buying from jewellers and speculators, leading to tight supply in Asia, dealers said on Wednesday. Premiums for gold bars in Hong Kong rose to as high as $3 an ounce to spot prices from $1.50 last week. In Singapore, the premiums strengthened to $2 from $1.20 a week ago. "Premiums are rising because refineries are finding difficulty in getting gold to produce bars," said a physical dealer in Singapore. |
| Silver shortages growing and premiums rising: Pat Heller Posted: 29 Sep 2011 09:09 PM PDT  Coin and bullion dealer Pat Heller reports at Coin Update on the rising premiums...and growing shortages for gold and particularly silver. It's a rather long read, but well worth your time, in my opinion...and the link is here. |
| Silver to go up hundreds of percent from here: Robin Griffiths Posted: 29 Sep 2011 09:09 PM PDT  Here's another King World News blog that Eric send me yesterday evening...and the link is here. |
| German bailout vote is 'too little, too late' Posted: 29 Sep 2011 09:09 PM PDT  Germany's Bundestag has voted overwhelmingly to boost the scope of the EU's rescue fund but implicitly capped its firepower at €440bn, leaving it no clearer whether Europe has the means to halt debt contagion to Italy and Spain. Chancellor Angela Merkel won her "own majority" for the bill, narrowly averting the collapse of her government, but only after pledging that there was no grand plan committing Germany to vast and unlimited liabilities. |
| WATCH: Rest Of World Recognizes GOLD is on SALE Posted: 29 Sep 2011 08:46 PM PDT There is good news for all Bengalureans who were waiting for an opportunity to invest in the yellow metal's safe haven. Yes the golden opportunity is back this festive season as the gold prices hit a new low after the prices shot through the roof. ~TVR |
| Scott Gardner: Europe's Debt Crisis and Its Effect on Gold Posted: 29 Sep 2011 07:00 PM PDT If you want to know the future, pay attention to the decisions European policymakers will have to make regarding debt, says Scott Gardner, chief investment officer at Verdmont Capital. In an... Visit the aureport.com for more information and for a free newsletter |
| Bank Crisis and the Effect on the Gold, Silver prices Posted: 29 Sep 2011 05:36 PM PDT Gold Forecaster |
| Posted: 29 Sep 2011 05:32 PM PDT |
| Second Largest Bull Market Correction for Silver Posted: 29 Sep 2011 05:09 PM PDT Odds and ends from the Chart Book, silver and The Little Guys.
Continued… What are the odds this will end up being the largest correction for silver – even larger than the 2008 near 60% retrace panic lows? We Vultures believe that just about everything that governments and central banks will end up having to do over the next while will involve force feeding more liquidity into an already liquidity-bloated, over-leveraged monetary system - in order to keep deflation at bay. Nobody wants deflation, but for central banks deflation is the anti-Christ and must be avoided at all costs. When possible banking collapse push comes to monetary policy shove, we can count on the Fed, E.U. and even the China "put" of more quantitative easing – if necessary, just wait and see. Short term moves are anyone's guess at this point, but longer term the bull case for precious metals is rock solid. That's why most of the seasoned and really savvy analysts keep saying to buy the harsh dips. That's why quite a few central banks are on the bid for gold now too instead of selling. They see more money printing ahead too. On another note, if it has felt like this has been an especially harsh pullback/correction for the smaller, less liquid and more speculative miners and explorers, like the ones which populate the Canadian Venture Exchange Index or CDNX, … the companies we often refer to as "The Little Guys", … well, it has been, no matter how one measures it. Just below is the CDNX compared to the HUI, which tracks a basket of the larger gold and silver miners.
The current market for The Little Guys is almost as harsh as the 2008 collapse relative to the HUI, and the HUI was decimated then too. As bad as it got for the Big Miners, it was pure purgatory for their smaller cousins three years ago. When bargain hunting, think cheap, think very cheap, especially in a rush to liquidity cascade lower like the one trying to get it on right now. When we compare the CDNX to gold (below), we can see that there is a profound shortage of confidence in speculative stocks and there has been since 2008. This ratio has fallen below the lows of last year and is not all that far from its all time lows set in 2008.
Small mining companies ironically need a more confident market to keep pace with the underlying commodities. That is in part why mining shares did not strongly outperform gold and silver until after they peaked in 1980. The paradox was that as the metals rose and went parabolic in the late 1970s it was during a crisis of confidence with fears of hyperinflation. Metals soared, but mining equities suffered along with other stocks at the tail end of a protracted bear market. Mining companies are stocks and stocks underperform in times of crisis, but they often improve well before the return of confidence is apparent to most people.
We just don't get all that many true panic cascade opportunities to work with in a trading career – they are rare. And remember that we believe that it is only a question of time before the miners, big and small, begin to "answer" the metals just as they finally did in the early 1980s. So we sure do want to take advantage of as much of this rare event as we can … if it continues, that is. That's if the market doesn't start to discount a major change too soon before the best and cheapest part of the panic op arrives.
We aim to first identify that condition and then join them when they do, adjusting our super-bargain targets as we go along as best we can. When one follows and charts more than sixty different issues in the same sub-sector as we do, it's pretty clear when there is a major change of investor/trader sentiment and demand afoot. |
| Lower Lows in the Cat-Like Real Estate Market Posted: 29 Sep 2011 05:06 PM PDT Cash is still king. Cash is king because non-cash is a commoner and a loser...it's losing its value. An article in yesterday's Financial Times, for example, tells that: "US inflation expectations at lowest point in year." In other words, forget inflation. Forget price increases. It's cash...cash...cash. Cash on the barrel...cash in hand...cash and carry. You got cash? You da king! People expect cash to be more valuable. And if we're right...it will be more valuable. Stocks, for example, fell yesterday. The Dow dropped 179 points. And gold. It lost $34. Another article in yesterday's financial press told us that "it's a great real estate market...if you're rich." Why? Because the rich have cash. They're the kings, queens and jokers too. And now they can use cash to buy other assets at a discount. They get more for their money. When inflation subsides so do prices. And nowhere have they ebbed more than in the real estate market. A friend sent us an investment opportunity...a 12-unit apartment building in Florida, a block from the beach. What does something like that go for? Well, in the glory days of the bubble in real estate, it might have sold for $3 million. Today, it's available for $750,000 — with owner financing at 5%. Let's see...if you can get $800 per unit per month...whoa...this could be a good deal. Because you can probably cover the cost of operating and maintenance and still get better than a 5% yield. If that is true, over time, you get the building for free. But the problem with real estate is that every deal is different. Every toilet backs up in its own unique way...and every roof leaks in a different spot. If you don't know what you're doing...don't do your homework...and can't manage a property, including collecting the rent from people who don't have much money, you probably won't do very well. Here at The Daily Reckoning we prefer the public markets, where the tenants don't give you hard-luck stories and the paint doesn't peel. But what we see in the public markets is a lot worse than what we see in the real estate market. Where can you get a yield of 5% outside of housing? All over the investment world — except for US government debt — yields will probably go up. Cash in king. But cash is probably going to become even more powerful. In real estate, for example, the bad news is not yet fully priced-in. People assume that prices will hit a bottom and then begin going back up again. They figure they just need to buy at the right time and all will be well. But as we keep pointing out, markets are more like cats than like dogs. They play with their prey...killing them slowly while having some fun at it. Real estate has already been whacked hard. It's down 30% to 50% depending on where you look. But is that all there is? Is that the end of it? We don't think so. The trends that worked so happily together to boost real estate to bubble levels have now become surly and uncooperative.
But wait, we know what you're thinking. At today's levels, houses in America are not over-priced. They're about in line with the very long term trend. They're about where they should be. And at today's ultra-low interest rates — mortgages are below 4% — housing is a good deal. Maybe so. But Mr. Market doesn't care. Just as he didn't mind pushing up prices to dizzying heights he also doesn't mind pushing them down to dreary lows. He's an equal-opportunity deceiver. First, he made people think that housing always goes up. Now, he'll make them think that it always goes down. And when he's finished, you'll be able to buy a house for about half today's price. Of course, then...you won't want to. Because you will have learned an important lesson that you can pass on to your children: 'Don't buy a house. Rent. It's cheaper.' Then, perhaps house prices will begin to rise again. In the meantime...and perhaps for a long time...cash is king. And more thoughts... "Your problem is that you're a prescriptivist." Among the many things couples may argue about is why they argue at all. Some argue about money. Some argue about the children. But some disagree about what they disagree about. The subject set off declarations in the Bonner household recently. One of the team suggested that the reason for much of the (minimal) discord in the family was the tendency of the other member of the team towards prescriptivism. He had taken the term from linguistics, where two schools of thought have fought bitter battles. On the one hand, some linguists insist that language should follow certain prescribed forms. Saying 'ain't,' for example, is thought to be incorrect. Other linguists — the descriptivists — believe the rules should be derived from actual practice...not imposed. They see nothing wrong with saying 'ain't.' Back at home, the other member of the team denied the "prescriptivist" charge vigorously. "You make it sound like I lack imagination." "Well, I'm not saying you lack imagination. I'm just saying that you insist on having things just so. And 'just so' happens to correspond with the way you want them...and how you think they should be." "What's wrong with that?" "Well, nothing, if the way you wanted them was interesting and imaginative." "I've learned over the years spent with you that there's a reason why things are normally done the way they are usually done. You always want to experiment with things. New ideas. New places. New ways of doing things. You even dance funny. "...all very well, but it's really just another form of egotism. You turn your back on 2,000 years of accumulated experience...and then insist that your own innovation...or your way of looking at things...is superior." "Well, at least it's not hidebound...backwards looking...and conventional. And I don't dance funny. I just don't get much pleasure out of doing the same stupid motions that everyone else does, over and over, all night long. I like to experiment." "Well, it ends up being eccentric, quirky, and not very nice." "What?" "Take architecture, for example.' "Oh no..." "Yes, take architecture. The classical column was designed thousands of years ago. It has withstood the test of time. Its proportions are graceful and beautiful. It tapers up from the bottom. Not the other way around. If you turn it upside down, you will have an original shape. But it will not be very nice. It will be stupid and ugly." "I don't turn columns upside down." "No, but you do other things. And they don't always work. And I prefer to have things that look nice. Things that work." "You're just a rigid, stuck in the mud, prescriptivist." "Sticks and stones..." Regards, Bill Bonner,
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| Why Real Investors Love Political Incompetence Posted: 29 Sep 2011 04:56 PM PDT The market is extremely volatile. An indicator of market volatility, the Volatility Index [WCB: VIX] crept back above 40 on Wednesday. The VIX is anticipating more market upheaval to come. Why? The standard response you'll get is 'because there's a lot of uncertainty... about the US... Europe... gold... stocks in general'. But that's just a symptom. It's the governments and central banks creating this uncertainty. You see, they don't know they're largely to blame for the world's economic ills. Or that their attempts to fix matters only makes them worse. The market has voted. The best way to move forward from the Euro crisis is for Greece to default. Yet the ruling powers are doing almost everything to avoid this fate. The Americans, led by Tim Geithner, are upping the political pressure on Europe to create a highly leveraged rescue fund. They want to increase the 'firepower' of the €440 billion European Financial Stability Fund (EFSF) by having the European Central Bank (ECB) lend against it. According to The Age, this could create a bailout fund of up to €2 trillion, with the difference made up of loans from the ECB (which would actually be newly printed money). The Germans had a 'print your way to prosperity' mentality at the end of WWI. It led to hyperinflation. So while they recognise the need to 'do something' to avoid another credit crisis, they are reluctant to put their credit on the line to bail out other Eurozone nations. As a result, investor confidence is shattered. This is why you're seeing so much volatility. So how do you invest in this mess? Given this environment, it is prudent to continue to scale into the market selectively. You'll continue to see large rallies and sell-offs. So move into the market and buy on the down days - try to resist chasing the market on the way up. You'll still be rewarded for investing in good value companies in the current environment. But exactly when you'll receive those rewards is the question. The skill is trying to find companies which are a good business, but they stock value has been beaten down. The ongoing market volatility will present buying opportunities. As always it comes down to patience. Greg Canavan
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| Posted: 29 Sep 2011 04:49 PM PDT -- Welcome to the new world of stock market trading, where no one really knows what is going on. Below is a chart of the S&P500, showing last night's trading action. -- As you can see the market surged at the open as traders mistakenly thought the German vote to expand the European financial stability fund solves everything. It doesn't. The S&P then spent the rest of the day in steady decline, falling around three per cent from the peak.
-- The end result is in the hands of people who really don't know what they are doing. That doesn't inspire a lot of confidence, a feeling reflected in an erratic market. -- But the whole Europe thing is becoming a bit of a bore. While everyone sweats on the Greek outcome, the world economy continues to slow. Doctor copper, as shown in the chart below, is struggling. It's down nearly 30 per cent from the peak reached in February. Adding impetus to the move, strong volume accompanied the recent sell-off. -- But it's still got another 15 per cent to fall before it reaches the lows of 2010, which, as you'll remember, was the point where the market began to discount QEII. Will it be the threshold for QEIII? -- Hong Kong is a good proxy for what is going on in China's real estate market, so let's look at what's happening in Honkers. Below is a three-year chart of the Hang Seng index. It's not looking pretty. If the China property bubble is only just starting to show some cracks, then this market has much further to fall. -- If China continues to slow, it will have flow-on effects for Australia's nominal income growth, which in turn will see interest rates head lower by the end of the year. -- As far as investment strategies go, it could pay to have a look at beaten-down domestic cyclicals - like building materials companies - in advance of lower official interest rates. Commodity producers and mining services companies aren't likely to gain much support while a China slowdown is in the news. -- But here's a reason not to get too excited about growth (in any sector) in Australia. Our household debt levels are amongst the highest in the world. A recent 'working paper', called 'The Real Effects of Debt' released by the Bank for International Settlements (BIS) suggested there were debt thresholds where, once breached, they become damaging to growth. -- Before seeing what the thresholds are, take a look at the table below. It shows the systematic build-up of debt (combining household, corporate and government debt) across developed nations over the past 30 years.  -- Household debt is where we stand out as world-beaters. Australia's household debt is 113 per cent of nominal GDP, a level only exceeded by Denmark and the Netherlands. -- According to the BIS, 85 per cent is the threshold where debt becomes detrimental to growth. Australia is well beyond that point. -- This suggests a few things:
-- But any rally based on an interest rate cut will be purely cyclical. The world's equity markets, Australia's included, are in a 'secular' bear market. We are now suffering the consequences of decades of excessive debt growth. Total debt levels have grown to such an extent that they are damaging economic growth, not assisting it. -- And the refusal by officials to write off the bad debt and strengthen the global banking system is only making things worse. So make sure you have a 'bear market' strategy - plenty of cash, gold and good value, income-paying stocks to get through the next few years with your wealth intact. Because if you invest thinking it's a bull market, you'll go backwards. Greg Canavan
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| The Discovery of Gold in California by Gen. J.A. Sutter Posted: 29 Sep 2011 04:12 PM PDT SfMuseum |
| Gold Is The Cure For The Job-Drain Posted: 29 Sep 2011 04:00 PM PDT |
| Posted: 29 Sep 2011 04:00 PM PDT Gold University |
| Posted: 29 Sep 2011 12:00 PM PDT Although I feel I am wasting my time right now, I will try to help out the paper traders here with a TA look at the paper silver chart. This is the daily.  From the April Run up we had what calls irrational paper exuberance. Trust me, I think Silver should already be at $200, but on paper and using algorithms, that run was fast, and the charts clearly show it needed to retrace to the MA. That being said, without 5 margin hikes in 8 days I think we could have kept going to $100 and beyond, but then Blythe and JPM would be toast and thats the end of that story. RSI: Shows a decline to the 30 from the top in about 6 trading days. This has never pierced the 70 line since, mainly because as the summer went on, so did the margin hikes, and that's the end of that story. What we have now is an oversold RSI under the 30 algo, which means we are do for a pop. Could it move lower? Yup, it could stay in that red under 30, just as long it stayed in the blue 80 in April. MACD: Fully confirms the RSI. BUT, in May we had to come down from the 3 into the -2. Now we have gone from 1 to -2 and counting. This tells me their is ZERO speculation left in this trade. The specs were wiped out in May, never to return. The margins have killed this trade. Price: Although the recent move down felt bigger, it wasnt. And take away the $26 overnight Blythe 3 am print, and its looks a lot better. The May session was worse. Where do we go from here? In a normal market, we would bounce and test the upper band of that MA between $36-39 and then retrace and test again. My heart tells me this is it and to buy here, which I did (physical not paper). The reason I have not purchased paper silver here is that it may go lower. But my GUT also tells me we may see more downside on an Asian attack and especially before the Oct 18th CFTC meeting. If you are thinking to yourself, how does that make any sense, I'll tell you why it makes PERFECT sense: I am now rotating paper profits (and losses) into physical. So I am cost averaging so to speak into the physical metal 90% silver 10% gold. The reason for my recent purchase was because of a 45% move down in 3 days. Thus, it was on sale 45%. If you are waiting for the 100% sale to $0, you must be in Disney land. But but but some say its going lower! So. You think I have the time to sell my physical? D0 you think I'm stacking my phyzz to sell it now? I'm buying EOW (End Of World) Insurance. I will pay my premium (PUT options) and one day, get it all back. Now you know where I stand on this 'trade': I think Chairsatan Bernank will print more along with everyone of his central bank cronies. They must keep the ponzi inflation going-deflation is NOT an option, I hope everyone realizes this. Some say he is done printing. I say he is not. Thats not to say he might be done this year. This is a long term turtle race play. Get used to it. Its made this way to shake shake shake you. So from here if we see $22-24, which we might, I will buy more. And then at that point I will not sell my physical either. I will sell my PUT options, and buy even more phyzz, thanking Blythe for her fantastic derivative insurance scam. But dont be so stupid not to buy some here, as this MIGHT be the bottom. And I dont want to hear ANY crying if it is, and then see the donkeys chase it up and start buying at $40-$50 again! Dont want to hear it, because on a weekly chart we are forming a very long doji which might encompass the bottom here. I am past the point of buying phyzz for investment. I can buy paper silver option and juniors for investment. I buy the phyzz for security, wealth preservation, and survival. Any questions let me know if you are confused as to what I am doing. Site is 99% ready. I am assuming a Saturday/Sunday launch for good.  |
If you don't own any gold or silver yet, this may be a good time to consider it. As the world economic scene grows increasingly more dire, governments' efforts to control and regulate gold transactions will only increase.
US 90% Silver Coin, a physical silver product that has not been in production since 1964, is no longer available on the wholesale market at prices below the intrinsic value of the silver. In fact, it seems like the premium is trickling up literally almost every hour right now. I expect that the premium will continue to rise. For now, supplies are plentiful, but that could change within days.
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