Gold World News Flash |
- Harvey Organ's: Daily Gold & Silver Report
- Bank Fees? Let’s Tell The Banksters That We Don’t Want Their Stinking Bank Fees And That We Are Switching Banks
- The Huge Bank Dexia in Severe Trouble / Bernanke Ready to Supply Stimulus to Faltering Economy
- Extreme Increase in Demand for Physical Gold & Silver Globally
- Ned Naylor-Leyland: CFTC lets Morgan get away with rigging silver market
- Guest Post: Heresy And The U.S. Dollar
- Time To Reenter Gold?
- Martin Mesicek: Extreme Increase in Demand for Physical Gold & Silver Globally
- Zero Hedge Kindly Requests The Immediate Resignation Of Mary Schapiro For Gross Breach Of Professional Responsibilities
- Be Patient, Keep Watching for Your Opportunity to Buy More Silver and Gold
- Extreme Increase in Demand for Physical Gold & Silver Globally
- King World News interviews Norwegian bullion dealer and Rick Rule
- Gold(Stocks) Bottom?
- Soaring Financial Vol Leads CME To Announce A 33% Margin…Cut
- Rick Rule: Many Black Swans that Could Hit This Market
- The USA After the Euro Collapse
- On the Brink of the Greatest Bubble of Our Time?
- More Downside Ahead?
- John Embry: Silver is Completely Flushed Out to the Downside
- Soaring Financial Vol Leads CME To Announce A 33% Margin...Cut
- USTBONDS: The Monster Spleen
- Rick Rule - Many Black Swans that Could Hit This Market
- Market Snapshot: Dow Jones Soars 400 Points On European Rescue Plan #42
- Welcome to the New Bear Market
- Welcome to the Bear Market
- Is Gold Bound to Rebound?
- (Non) News Of Dexia "Bad Bank" Sends Market Soaring
- The open interest in silver is back to what it was when silver was $7 to $10, you haven’t seen it this low for a long time. So this has been effective, they have gotten the paper speculators out.
- The Ghost of Smoot-Hawley?
- US Dollar Gains Huge Chunks of Ground
| Harvey Organ's: Daily Gold & Silver Report Posted: 04 Oct 2011 07:34 PM PDT The Huge Bank Dexia in severe trouble/Bernanke ready to supply stimulus to faltering economy
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| Posted: 04 Oct 2011 05:06 PM PDT from The Economic Collapse Blog:
Read More @ TheEconomicCollapseBlog.com
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| The Huge Bank Dexia in Severe Trouble / Bernanke Ready to Supply Stimulus to Faltering Economy Posted: 04 Oct 2011 05:00 PM PDT by Harvey Organ: Good evening Ladies and Gentlemen: Europe continues to implode as Dexia, the largest bank in Belgium is close to default. The default here will bring down the two largest banks in France, Societe Generale and BNP Paribas. The bankers do not want investors purchasing gold and silver so they whack and sell huge amounts of non backed paper in the hope that they purchase stocks. The stock market was in bear territory this morning but the PPT certainly did their job in juicing the Dow northbound. I will highlight the news that sparked the rally. The price of gold finished the comex session at $1620 for a loss of $36.00 on the day. The price of silver fell by 76 cents to $29.99. The banking cartel were selling relentlessly without regard for profit. The regulators as always turn their heads away from the real noise. Let us head over to the comex and access the damage. Read More @ HarveyOrgan.Blogspot.com
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| Extreme Increase in Demand for Physical Gold & Silver Globally Posted: 04 Oct 2011 04:05 PM PDT  King World News is continuing to get reports from sources around the world regarding tremendous physical demand in both gold and silver. One source out of Norway told KWN, "What I can report from Norway, and as you know we are not part of the euro system, we are experiencing an extreme increase in physical demand for bullion, both in silver and also in gold." This report came in from Martin Mesicek, from Gold Source, the largest bullion dealer in Norway.
This posting includes an audio/video/photo media file: Download Now |
| Ned Naylor-Leyland: CFTC lets Morgan get away with rigging silver market Posted: 04 Oct 2011 04:01 PM PDT 11:55p ET Tuesday, October 4, 2011 Dear Friend of GATA and Gold (and Silver): Ned Naylor-Leyland, investment director for Cheviot Asset Management in London, who spoke at GATA's Gold Rush 2011 conference there in August, complains in a new Cheviot investment letter about JPMorganChase's manipulation of the silver market and the U.S. Commodity Futures Trading Commission's continuing facilitation of that manipulation. Naylor-Leyland's commentary is headlined "Silver, Gorillas, Madoff, and Financial Regulators -- Will They Ever Learn?" and you can find it at Scribd here: http://www.scribd.com/doc/67350783/Silver-Gorillas-CFTC-Etc-1 CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT For Continuous Wealth Creation, the Hera Research Newsletter The life cycles of companies that produce natural resources allow investors to allocate assets among companies at different stages of development and to profit from transitions between stages. Based on natural resource company life cycles, the Hera Research Newsletter maximizes profits through deep, fundamental analysis at each stage of development and by moving gains back to earlier-stage companies in a continuous wealth-creation process. Hera Research covers a pipeline of high-quality natural resource companies at different stages of development. The companies span discovery and production of gold, silver, and platinum group metals, select base metals, oil and gas, green energy, agriculture, rare earth elements, uranium, and more. Discover the unique value of the Hera Research Newsletter by visiting: http://www.heraresearch.com/newsletter.html Or call Ron Hera at 360-339-8541x101. Join GATA here: 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 Golden Phoenix Signs Definitive Agreement to Acquire and Reopen Santa Rosa Gold Mine in Panama Company Press Release SPARKS, Nevada -- Golden Phoenix Minerals Inc. (OTC Bulletin Board: GPXM) has signed a definitive agreement to acquire a 60 percent interest, with an option to buy an additional 20 percent interest, in the Santa Rosa gold mine in Panama, now owned by Silver Global S.A., a Panamanian corporation. Santa Rosa produced more than 100,000 ounces of gold from 1996 to 1998 before being closed in part to low gold prices, which are now more than five times higher. Golden Phoenix intends to acquire its initial 60 percent interest in Santa Rosa by acquiring 60 percent of the share capital of a recently created company under the name Golden Phoenix Panama S.A., formed to hold and operate the mine. Tom Klein, CEO of Golden Phoenix says: "The agreement establishes a solid framework from which we can advance Mina Santa Rosa to production-ready status." For Golden Phoenix's complete statement, please visit: http://goldenphoenix.us/press-release/golden-phoenix-signs-definitive-ac...
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| Guest Post: Heresy And The U.S. Dollar Posted: 04 Oct 2011 02:48 PM PDT Submitted by Chris Martenson contributing author and Zero hedge familiar Charles Hugh Smith Heresy and the U.S. Dollar There is only one word to describe the opinion that the U.S. dollar is in a multi-year uptrend: heresy. Understanding why this is so may well be critical to understanding market action in the 2011-2016 timeframe. Embracing the contrarian viewpoint offers little joy, because heretics are constantly being hounded by devotees of orthodoxy seeking their conversion to the one true faith or their crucifixion as mortal threats to the orthodoxy. Why is this so? For two simple but profound reasons. The human mind strongly prefers certainty to uncertainty and simple, fixed explanations over complex, contingent explanations. The human mind has a second, superglue-like quality: Once a viewpoint has been plucked from the swirling chaos of beliefs and explanations, then the mind quickly solidifies that view, resisting any future modification. Very little energy is devoted to questioning the position, while enormous energy is devoted to defending it. This reality is expressed via "confirmation bias," the term used to describe our tendency to focus on data that supports our pre-selected view and ignore data which challenges it. Orthodoxy—fixed positions that are articles of faith to be defended against all challenges—is thus a psychological safe haven in a risky, dynamic world. Having a belief system or global explanation not only offers us the comforts of certainty, it also enables us to make forecasts based on that explanation. Those forecasts become part of the orthodoxy which must be defended. Being a trader makes one a heretic, because traders see orthodoxy not as a safe haven but as a mortal danger. This is the root of trader expressions such as "Marry your spouse, not your portfolio." From painful personal experience, traders learn that trading based on orthodoxy eventually leads to crushing losses. Why is this so? There is a difference between being "right" and making money. The devotee of orthodoxy is committed to being "right" in a global sense; i.e., confirming that the orthodoxy's forecast will be proven correct. The trader is only interested in being "right" in a much narrower definition: Did the trade gain value or lose value? The market is the only arbiter of "right" and "wrong" to the trader, and all of the ceaseless debates and arguments between the believers of various orthodoxies are viewed as potentially dangerous distractions. The trader recognizes multiple timeframes and grasps that a trade has to align with the market action of a specific phase to be successful; i.e., gain in value. A trade may be successful in a three-day timeframe, but unsuccessful in a three-week timeframe, and ultimately successful in a three-year timeframe. The problem with orthodoxy is that adherents believe it must be correct in all phases and timeframes. Thus the Bull is wiped out in Bear markets and the Bear is wiped out in Bull markets, trend followers are wiped out in volatile phases, and those trading volatility churn away their capital in non-volatile trending markets. This partly explains why the number of traders/money-managers who outperform index funds in the long run over both Bull and Bear markets is essentially statistical noise. The appeals of orthodoxy are that powerful. Traders are heretics for another reason: They reject the illusion that there are "investments." To a trader, the word "investment" is simply a marketing ploy of the financial Status Quo, a word designed to evince a plummy, wood-paneled security from risk. This reflects the core article of faith of the financial Status Quo orthodoxy, which is that risk can be massaged away. Traders understand that risk cannot be massaged away, and that capital put into any market at any time is always at risk. Every investment is a trade, and every trade is a speculation. Thus there is no "investment," there is only speculation, and the slightly sweaty, unpleasant proximity of speculation to risk is not masked with the heavy perfumes of PR, it is embraced as the one true lodestone. Traders understand that suppressing risk simply guarantees a greater eruption of volatility in the future. Traders are anathema to orthodoxy on multiple fronts. Devotees of orthodoxy understand the devotion of others in opposing camps, and even as they argue they feel comfortable with their shared worldview. But devotees distrust traders because they reject orthodoxy as the "solution;" it offends devotees that traders either change camps constantly or are studiously unattached to all camps. To the true believers of one investment orthodoxy or another, traders are renegades profiting where they "shouldn't"--being short as the market declines, for example. In other words, the "right" way to "invest" is to choose an orthodoxy and cling to it through thick and thin until proven "right." To the trader, this approach is equivalent to lighting one's capital afire and watching it burn. The trader thinks in terms of probabilities, not certainties, and looks to charts as reflections of human behavior. A forecast is simply an assessment of probability, a snapshot taken in the present of multiple dynamics and timeframes. The trader also offends orthodoxy, not just by refusing to place his faith in one camp or another, but in rejecting the entire notion that "big" global forecasts have any meaning in terms of making money in the here and now. The trader is aware of the various dynamics of hyperinflation, deflation, stagflation, biflation, "muddle-through" sideways markets, "stocks are cheap," "don't fight the Fed," the potential collapse of advanced civilization, and so on, but doesn't base trades on these dynamics. Traders understand that the market, and indeed, human history, is fundamentally a highly complex non-linear system. Change the parameters or the inputs, and even small fluctuations can trigger outsized consequences. As a result, forecasts of future events become less predictable the farther out in time we extend the forecast. Traders understand that X and Y might well occur in five years, but it's difficult to distill that potentiality down to a money-making trade in the near term. We all like being right and making money trading the markets, but the two are not identical. The adherent of orthodoxy finds the markets confounding when they don't conform to the orthodoxy's forecasts and explanations, and this frustration finds expression in confirmation bias; i.e., seeking data that supports the position and downplaying whatever doesn't, arguing vociferously on the basis of financial fundamentals, and seeking external explanations for the failure of the forecast (manipulation, seasonal trends, and so on). The one phrase you will rarely hear issuing from orthodoxy is "I was wrong and I'm radically changing my view." It's painful to be wrong; our human pride is wounded when our convictions turn out to be misplaced. It's also painful to lose money in a losing trade, but when given a choice between the two, adherents of orthodoxy prefer to lose money rather than surrender their convictions. Traders view convictions as a potentially deadly trap, and have trained themselves to find comfort in uncertainty and permanent contingency. It's easier to jettison a trade than a conviction. As a thought experiment, look at this chart and decide if it is bullish or not.
Does your view change if it is a chart of a commodity? What if it is a chart of a mining company, or a tech stock? What if it is a chart of the U.S. dollar index, the DXY? Well, it is. How resistant do you find yourself to viewing this chart as unambiguously bullish? Do you find yourself seeking evidence that it isn't really that bullish, evidence that "this looks ready to roll over and decline?" In certain camps, it is an article of faith that the U.S. dollar is deservedly doomed to extinction. The trader accepts this as a future possibility, but does not see any tradable evidence of this possibility in this chart/snapshot of the past two years. As traders, we are well-served by a willingness to seek evidence which undermines or challenges our positions, as this habit counteracts confirmation bias. As traders, we see probabilities for advance and decline in all charts, and the assessment isn't about being "right" or "wrong" but about the higher and lower probabilities implicit in the chart. Anything, including a bullish dollar, can become an article of faith in an orthodoxy, just as anything can become heresy. If this chart is bullish, what does that suggest about the probabilities of future price action in the US dollar (i.e., the DXY)? In Part II: The Technical Argument for a Stronger Dollar, we use technical analysis to explore the case for a possible multi-year advance of the dollar from here. A key question for investors (especially gold bugs) to ask here is this: Whatever the probability, what impact would a sustained rise in the dollar have on your current portfolio? Click here to access Part II of this report (free executive summary, enrollment required for full access).
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| Posted: 04 Oct 2011 02:39 PM PDT Stock markets are tumbling from Japan to Wall Street. Already shaky Spanish and Italian financial instruments are quaking in their fancy boots as Greece does not make the cuts needed to be able to receive financial assistance. Vladimir Putin, a prototypical example of a classic Russian Bear says that the American Bull has blunted horns and suffers from impotence. He states, "Americans are living beyond their means and shifting the weight of their problems to the world economy…They are living like parasites off the global economy and their monopoly of the dollar." China joined Putin by calling the brouhaha in the West as "madcap brinksmanship." The scepter of fear is haunting the fiscal world from West To East. International turbulence is precipitating a search for safe havens. Treasuries (TLT) are hitting new highs, the U.S. dollar (UUP) has bounced versus other currencies, commodities (DBC) are being sold off and gold(GLD) and silver (SLV) bullion's volatility has increased significantly. These actions are signaling a notice of caution in an economy which is in desperate need of jobs. It is not only the debt crisis, it is the DEBT. The world is worried. No country including the United States can long remain a global factor when dollars are being squirreled away at close to 0% interest in cash and long term treasuries. This capital should be productively used to build factories, mines and mills. Dormant dollars and treasuries are not exactly the B12 injection that the old bull needs. Do not be surprised as unemployment soars that the Fed at its upcoming meetings does a reprise of the show from the summer of 2010. It may not be a stretch to think that all of these developments may be programming us for Chapter 3 in an ongoing series of quantitative easing to try to stimulate job growth and to stave off a deflationary spiral as Operation Twist was a dud. By now our readers should realize that it is specifically those sectors representing wealth in the earth resources such as the gold (GDX) and silver (SIL) miners that will prove to be areas of sizable payouts in times to come. Our sectors represent buys of a lifetime as the global economy is in convulsions. It must be realized that not all wealth in the earth sectors move synchronously. Gold and silver are unique in that over the centuries they move from peaks to valleys and back again with breathtaking volatility. An examination of historic charts reveal that despite the ongoing roller coaster the precious metal arc rolls upward.
Right now, gold(GLD) has achieved our long awaited pullback to the $1600+ area. Our firm recommended taking partial profits in a percentage of our holdings in gold before this pullback. It appears to be a prudent move as we witnessed a short term decline. Now may be a more propitious time to reenter at oversold conditions and after a healthy correction. Take a free 30 day trial of my premium service by clicking here.
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| Martin Mesicek: Extreme Increase in Demand for Physical Gold & Silver Globally Posted: 04 Oct 2011 02:23 PM PDT from King World News:
Martin Mesicek continues: Read More @ KingWorldNews.com
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| Posted: 04 Oct 2011 01:51 PM PDT Ever wonder why the final SEC report on the flash crash doesn't match up to the forensic evidence found by Nanex? It seems the SEC/CFTC failed to disclose they didn't get around to interviewing the traders that actually executed the algorithm blamed for dumping 75,000 emini contracts on the market "without regard to price or time" until 2 weeks after publishing their final report on the flash crash! Apparently, they were making a lot of things up to fit a foregone conclusion. According to the media, it was Waddell & Reed who executed those trades right? Well, no. Barclays executed the contracts using their time tested algorithm called Participation. You simply can't crash a market with the Participation algorithm. This is an algorithm that in fact has sophisticated price and time components. This is an algorithm that would only sell at the offer -- and never at the bid. This was discovered and pointed out by Nanex after just one day reviewing the actual 6,438 eMini contract trades (75,000 contracts) which ZeroHedge helped obtain. But the media was happy to hang the guilt on an out of town mid-west Mutual Fund company, and besides all this stuff was getting way too complicated. After all, when it comes to such complexities, it is only economy PhDs who are fit to opine at will. Only the SEC/CFTC wasn't counting on anyone double checking their work... So a week after Nanex published their findings on the eMini trades, the CFTC holds their very first interview with Vijay Pant -- the man in charge of executing the infamous W&R trades at Barclays using the Participation algorithm. Here's a link to the CFTC website showing that meeting. This was the first time the SEC/CFTC actually interviewed those with intimate knowledge about the algorithm blamed for the flash crash in the SEC/CFTC final report. How many heads will roll for this faux pas? And if it is only one, it better be that of Madoff "dear friend" Mary Schapiro who may have slipped through the cracks after the biggest ponzi scheme, since the US government, was handed to her on a silver platter. But not this time. If it is indeed confirmed that the agency, which is already in hot water for purposefully destroying evidence confirming various hedge funds have participated in insider trading, we are confident that the mere onslaught of class action lawsuits against the SEC, which one can now accuse of out right cover up, by anyone who lost money on May 6, will force not one but countless resignations, as the rats abandon the sinking ship, terrified by the prospect of civil and criminal liability pursuing their very own sad and pathetic bureaucratic careers. We urge any and all class action lawyers among our readers to do their thing.
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| Be Patient, Keep Watching for Your Opportunity to Buy More Silver and Gold Posted: 04 Oct 2011 01:43 PM PDT Gold Price Close Today : 1614.70 Change : (41.30) or -2.5% Silver Price Close Today : 29.795 Change : (0.955) or -3.1% Gold Silver Ratio Today : 54.19 Change : 0.340 or 0.6% Silver Gold Ratio Today : 0.01845 Change : -0.000116 or -0.6% Platinum Price Close Today : 1480.00 Change : -32.00 or -2.1% Palladium Price Close Today : 566.00 Change : -25.00 or -4.2% S&P 500 : 1,123.95 Change : 24.72 or 2.2% Dow In GOLD$ : $138.38 Change : $ 5.38 or 4.0% Dow in GOLD oz : 6.694 Change : 0.260 or 4.0% Dow in SILVER oz : 362.77 Change : 16.26 or 4.7% Dow Industrial : 10,808.71 Change : 153.41 or 1.4% US Dollar Index : 79.60 Change : 0.166 or 0.2% 'Twas a pretty strange day in SILVER and GOLD. Pretty strange. 'Twas even strange in stocks. Stocks stayed underwater all day, never even bobbing above the surface for one second, until the last 30 minutes when they raced up from 10,411 to end the day at 10,808.71, up 153.41 or 1.44%. S&P rose 24.72 to 1,123.95 (up 2.25%). Sure, there were lots of reasons that rally makes sense. Moody downgraded the Italian government's credit rating today three notches to A2 while Greeks are striking, and Greek gov't. now admits it can't meet the Troika's demands and so will not get its bail out money on 13 October. Meanwhile, Bernard O'Bama is scooting around the country selling his snake-oil stimulus, building more four lane roads to nowhere. Truth is, only reason I can find on the bounce is technical. There's a downtrend line parallel to the bottom line of the Jaws of Death top, a line going back to January 2011 and running thru the March 2011 bottom. It will likely bounce, then gravity will take over again and pull it down toward the 2010 low at 9,614. That, of course, will only BEGIN the plunge, but stocks will briefly rally from a low somewhere near there. The Dow Industrials and Dow Transports have now both made new lows for the year. That's a Dow Theory signal that the trend has turned down, and offers as much comfort to stocks as a bed of needles and a can of pepper spray offers a naked man with hives. STOCKS -- the cosmic scheme to defenestrate your retirement. The US DOLLAR index is trading now at 79.597, up 16.6 basis points or 0.21%. It long ago left behind a 38.2% correction of its May 2010 to May 2011 fall. That milestone was left behind at 78.64. Next big mark is the 50% correction point at 80.58, then the 61.8% at 82.52. Did y'all notice that ALL those likely targets are ABOVE today's price, far above? Deflation scare is coming. Y'all brace yourselves, the hogwash will flow in tidal waves. Euro today rose 0.68% to close at 1.3252. Remains to be shown that yesterday really constituted a bottom. Yen continues to temporize sideways, neither moving up nor down. Closed today down -0.31% at 130.17c/Y100 (Y76.82/$1). What strange thing happened in SILVER and GOLD? Both fell off sharply from yesterday $1,655 close to $1,600 - $1,610. After the Comex close of $1,614.70, down $41.30, the GOLD PRICE trailed off then about 3:00 plunged to $1,595. Plunged, then immediately shot right back up over US$1,626. Blinked your eyes and you missed it. The SILVER PRICE acted the same way, plunging to a sudden 3:00 low at 2865c, then rising to 3020c. However, it has since backed off to 3006c. Think about this: the SILVER PRICE traded on a 264c spread between high and low today, 9.2%. Rough to trade that. The GOLD PRICE posted a 5.1% high-low range. Today's aftermarket action has the flavor of a key reversal, breaking into new low territory and climbing higher. The SILVER PRICE broke below its 2950c range, but then at once scrambled back into it. That makes that 2950 look stronger, but pushes the support down to 2865c. For gold and silver, today might be nothing more than the first move down of a new downleg. Be patient, keep watching for your opportunity to buy more SILVER and GOLD. Keep watching for your chance to swap gold for silver at 57.5:1 or better (Comex closed 54.194 today). Stay away from stocks AND armadillos, because they carry leprosy -- the armadillos, that is. Don't spit on the sidewalk, wear your seatbelt, wash your hands every 3 minutes, and follow all the rest of the government rules that are BOUND to bring you satisfied happiness. Argentum et aurum comparenda sunt -- -- Gold and silver must be bought. - Franklin Sanders, The Moneychanger The-MoneyChanger.com © 2011, The Moneychanger. May not be republished in any form, including electronically, without our express permission. To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $3,130.00; silver's primary is up targeting 16:1 gold/silver ratio or $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down. Whenever I write "Stay out of stocks" readers inevitably ask, "Do you mean precious metals mining stocks, too?" No, I don't. Be advised and warned: Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures. 
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| Extreme Increase in Demand for Physical Gold & Silver Globally Posted: 04 Oct 2011 12:30 PM PDT we are not part of the euro system, we are experiencing an extreme increase in physical demand for bullion, both in silver and also in gold.
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| King World News interviews Norwegian bullion dealer and Rick Rule Posted: 04 Oct 2011 12:13 PM PDT 8p ET Tuesday, October 4, 2011 Dear Friend of GATA and Gold: King World News never sleeps. Tonight it has an interview with Norwegian coin and bullion dealer Martin Mesicek, who comments on the huge increase in demand for precious metal in his country: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/10/5_Ex... King World News also interviews resource company broker Rick Rule about "black swans" that could leave their droppings anywhere in the markets. You can find it here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/10/4_Ri... CHRIS POWELL, Secretary/Treaurer ADVERTISEMENT Be Part of a Chance to Discover Multi-Million-Ounce Gold and Silver Deposits in Canada Northaven Resources Corp. (TSX-V:NTV) is advancing five gold and silver projects in highly prospective and politically stable British Columbia, Canada. Check out the exploration program on our Allco gold/silver project : -- A large (13,000 hectare) property, covering more than 15 square kilometers of a regional mineralized trend just 3km from a recently announced 1.2-million-ounce gold and 15-million-ounce silver deposit. -- The property hosts historic high-grade silver workings and many mineral showings as well as former mines at the property's northern and southern boundaries. -- A deep-penetrating airborne geophysics survey has just been completed on the entire property and neighboring deposits and its results are eagerly awaited. To learn more about the Allco property or Northaven's other gold and silver projects, please visit: http://www.northavenresources.com Or call Northaven CEO Allen Leschert at 604-696-3600. Join GATA here: 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 The United States Once Again Can Establish a Stable Dollar Worth Its Weight in Gold Lewis E. Lehrman, chairman of the Lehrman Institute, sponsor of The Gold Standard Now project, has released a plan to restore economic growth through a stable dollar. The plan, titled "The True Gold Standard: A Monetary Reform Plan Without Official Reserve Currencies," responds to the recurrent economic crises of the last century and outlines a detailed proposal for America's leadership on "how we get from here to there." That is, how we get from the present unstable paper dollar to a stable dollar as good as gold. James Grant, author and editor of Grant's Interest Rate Observer, says of the Lehrman plan: "If you have ever wondered how the world can get from here to there -- from the chaos of depreciating paper to a convertible currency worthy of our children and our grandchildren -- wonder no more. The answer, brilliantly expounded, is between these covers. America has long needed a modern Alexander Hamilton. In Lewis E. Lehrman the country has finally found him." To learn 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: 04 Oct 2011 10:58 AM PDT Earlier today, the markets tanked on Europe concerns. Gold & Gold Stocks were not spared. While everybody is in panic mode, it's time to look at some interesting charts. Let's start of with the HUI index: Read More...
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| Soaring Financial Vol Leads CME To Announce A 33% Margin…Cut Posted: 04 Oct 2011 10:51 AM PDT from ZeroHedge:
Because while soaring volatility in gold and copper, not to mention silver, results in one after another margin hike to "cool off the speculators", when it comes to financial stocks, especially in the "tail wag the dog" variety where the synthetic drives the stock price, a surge in vol means a cut in margins, or 33% to be precise. As of minutes ago, the biggest futures exchange just cut XAF margins by a whopping 33%, exploding vol be damned, or actually, because of it. The CME would be even more delighted if clients were to pledge their gold as collateral, especially following yesterday's expansion of gold's marginability from $200 to $500 million. So just in case anyone missed the message from today, when fins plunged then soared on a rumor, the CME would be delighted if you could repeat all of that but this time with 23% more margin. Expect more margins cuts, this time in ES offset by margins hike in all other instruments, especially of the public enemy #1 variety such as precious metals and crude.
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| Rick Rule: Many Black Swans that Could Hit This Market Posted: 04 Oct 2011 10:29 AM PDT from King World News:
Rick Rule continues: Read More @ KingWorldNews.com
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| The USA After the Euro Collapse Posted: 04 Oct 2011 10:26 AM PDT Gas For $1.75 A Gallon & Depression Level Unemployment by Daniel R. Amerman, CFA:
The US dollar could soar in value. Gasoline could return to under $2 a gallon, possibly even $1.75, and filling up a near empty tank could once again be done for under $30. The prices of clothes, shoes and a shopping trip to Wal-Mart could drop significantly, providing much needed relief to retirees on fixed-incomes. In the midst of global economic crisis, there could be an "Indian Summer" in the United States with a return to cheap oil and abundant imports at prices well below current levels. Standards of living could briefly rise – for those fortunate people who still have jobs and/or stable incomes. Read More @ SilverBearCafe.com
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| On the Brink of the Greatest Bubble of Our Time? Posted: 04 Oct 2011 10:22 AM PDT Synopsis: It may seem hardly possible, but Jeff Clark has found someone who is more bullish on precious metals than we at Casey Research are. Jeff shares some of a recent interview with him. Dear Reader, Two types of music seem to draw the most animosity – country and rap. Rarely does anyone have a strong hatred of pure rock n' roll, but pretty much everyone hates either rap or country music. Personally, I was once a huge fan of country, but over time, I've become tired and frankly disgusted with it. At first, I really enjoyed a lot of the lyrics in country music. They're wholesome, with good values and often a decent message. On the opposite spectrum, rap music often celebrates sloth, indecency, and criminal behavior. However, after some deep thought, there's something much better about rap than country. It's not the actual songs or even the lyrics – it's the realism. Many people aren't comfortable with the truth; hence, that's why there's so much hatred of the music. In contrast, country music is the sound of American politics. Think about it. There are always references to family, church, farmers, factory workers, small towns, etc. Politicians use the same approach word for word whether it's referring to kitchen tables or visiting small towns. Furthermore, politicians never forget their obligatory mentions of farmers – which is particularly confusing since the vast majority of Americans no longer farm. According to the BLS, fewer than 1.2 million Americans are employed in farming, fishing, and forestry. Frankly, most Americans aren't farmers and neither are most listeners of country music. So why the constant appeal to the farming profession? In my opinion, it's a national obsession with a pastoral fantasy that no longer exists. And for this reason, it manages to pull at our heart strings. Like country songs, politicians must throw something about God and church into every campaign. I certainly don't have anything against either, but I hate seeing politicians basically forced to mention God. In my opinion, it's a bit sacrilegious. Also, don't forget the worship of the warfare state. In the eyes of country music writers, American foreign policy is always correct and virtuous. Similarly, US citizens apparently will not stomach a non-interventionist president. The pop-country love songs in particular make me want to puke. More often than not, the song's protagonist marries his high-school sweetheart and lives happily ever after – usually with some line about swinging in rocking chairs 60 years later. Is this really the reality for most Americans? I bet that half of our readers have been divorced at least once. It'd probably be easier to locate a reader on his fourth marriage than one still married to his high-school sweetheart from 40 years ago. In short, country music is an illusion. It paints an idealized America which no longer exists and arguably never existed. This image pulls out at our heart strings and as a result, sells records and garners votes. However, this pastoral fantasy is not reality for most Americans. And for that reason, I appreciate the crude, depressing, and even angering aspects of rap music. While country music artists sing about working on the farm, many rap singers recount tales of growing up on welfare. With 46 million Americans collecting food stamps, which story better fits the modern American experience: the farmer or the welfare recipient? Exactly, but let's take it one step further. The US currently has 2.3 million inmates behind bars. There are about 5 million Americans on parole or probation. Compare those numbers to the less than 1.2 million farmers. In my opinion, rap music is a refreshing reminder that we're not in Kansas any more. We don't live in a country where everyone is really hard-working and was raised with good values. A sizeable portion of the population has no intention of staying out of trouble and getting a solid job. Their career ambitions amount to being the toughest and most-respected thug on the street. Their idea of a good time is some cheap drinks and if in luck, smoking a little crack or crystal meth in front of the TV. A good chunk of the US citizenry is not interested in balancing the budget and steering the nation to the "right" course. They do not give a damn if Rome burns the ground. In fact, they're ready to partake in its destruction. While country music may make us feel good, it's just not a reflection of reality. Travel to an urban hellhole near you, and the whole rap music thing will make a whole lot of sense. Even if the music disappears, those neighborhoods shattered by decades of poor government policy will still exist. Personally, I don't like being fooled with stories and songs of sunshine and rainbows. As a result, I appreciate some of the honest ugliness in rap music and despise the manufactured bull coming out of Nashville. Whatever those country stars are singing about, it is not the America I see every day. Next up is Jeff Clark with a thought-provoking interview with Mike Maloney, the founder of GoldSilver.com, then I'll return with some additional links.
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| Posted: 04 Oct 2011 10:21 AM PDT from TFMetalsReport.com:
Gold 1596. Silver 28 and change. ABX 43. EXK 7.60. SLW 25.97. YIKES! DOUBLE YIKES!! But there is currently a pretty significant rally taking place in the stock market so maybe all is well. OK, probably not. It's more likely just The Fed painting the tape through the intercession of their primary dealers. Here are your updated PM charts. This latest selloff has made their nascent recoveries look tenuous, at best. Both appear poised for a mid-week test of last weeks lows. Read More @ TFMetalsReport.com
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| John Embry: Silver is Completely Flushed Out to the Downside Posted: 04 Oct 2011 10:15 AM PDT from King World News:
John Embry continues: Read More @ KingWorldNews.com
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| Soaring Financial Vol Leads CME To Announce A 33% Margin...Cut Posted: 04 Oct 2011 09:46 AM PDT Because while soaring volatility in gold and copper, not to mention silver, results in one after another margin hike to "cool off the speculators", when it comes to financial stocks, especially in the "tail wag the dog" variety where the synthetic drives the stock price, a surge in vol means a cut in margins, or 33% to be precise. As of minutes ago, the biggest futures exchange just cut XAF margins by a whopping 33%, exploding vol be damned, or actually, because of it. The CME would be even more delighted if clients were to pledge their gold as collateral, especially following yesterday's expansion of gold's marginability from $200 to $500 million. So just in case anyone missed the message from today, when fins plunged then soared on a rumor, the CME would be delighted if you could repeat all of that but this time with 23% more margin. Expect more margins cuts, this time in ES offset by margins hike in all other instruments, especially of the public enemy #1 variety such as precious metals and crude.
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| Posted: 04 Oct 2011 09:22 AM PDT Some truly dangerous winds are blowing. Restrictions of gold purchase are being imposed in Central Europe. Wall Street has openly mentioned their menacing arbitrage targeted against Europe in exploitation of their financial crisis. The Mexican disintegration continues apace, with no coverage except the illicit weapons sales from the USDept Alcohol Tobacco & Firearms. The Mexican Peso is down to 14 per USDollar. The Saudi transition continues behind the curtains, as they adapt to a new Chinese protector in the Persian Gulf, and watch the global pendulum swing from an oil-based pivot to a gold-based pivot. Russia is busy preparing channels to Central Europe for commodity supply. That is not new, but the financial underpinning might be, since not based upon the USDollar. JPMorgan CEO Jamie Diamond bickers with the Canadians and overlord Swiss bankers. Perhaps is all show. Perhaps instead JPMorgan stands on far fewer legs than a couple years ago, and what we observe is twitching and teetering. Goldman Sachs CEO Lloyd Bunkfein struggles to avoid a perjury indictment. Lies to the Levin Committee might have come back to haunt him. They were blatant. The prestige of the US bankers is fast vanishing.
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| Rick Rule - Many Black Swans that Could Hit This Market Posted: 04 Oct 2011 09:14 AM PDT  With stocks turning higher, gold near $1,625 and silver at $30, today King World News interviewed one of the most street smart pros, Rick Rule, Founder of Global Resource Investments, which is now part of the $10 billion strong Sprott Asset Management. When asked about the tremendous volatility and wild swings in all of the markets, Rule responded, "What I see happening is a crisis of confidence. The market disarray in 2008 was famously attributed to black swans. As we've talked about before, there seem to be so many (black) swans on the horizon now that they resemble a cloud."
This posting includes an audio/video/photo media file: Download Now |
| Market Snapshot: Dow Jones Soars 400 Points On European Rescue Plan #42 Posted: 04 Oct 2011 08:42 AM PDT UPDATE: Moody's ITA downgrade took some shine off as EUR drops 60 pips and ES now 13pts off its highs. TSYs are 3-4bps lower in yields. Gold/Silver not moving much on it. On the basis of old news, more promises, lack of any clarity, and Dexia's dump on the Belgian government, the equity markets staged a 4% rally in the last 45 minutes to end an incredible day. Our assumption is that this was simply the bounce that everyone expected as we seemed to have squeezed shorts into lunch and were limping back lower on AAPL disappointment. Quite clearly, there were a few uncomfortable equity shorts who were squeezed out rapidly and incessantly as the S&P massively outperformed credit as well as the broad basket of risk assets - even TSYs only managed to sell back to earlier day's high yields (as opposed to extending). Gold/Silver rallied (though well off week highs) as the USD dumped back near the week's lows and copper and oil rallied but again no where near as ebullient as stocks. Evidently, the equity move is exuberant at best but these squeezes seem able to maintain longer than anyone expects.
The clearest example of the exaggerated move in equities is probably against the broad-basket of risk assets known as CONTEXT which tracked very well all day but was simply unable to keep up with the covering in ES as we rallied. While it does not mean equities are absolutely expensive, it does imply there is a disconnect between risk appetites relatively speaking and would suggest equity weakness short-term (from our experience).
We had noted all day that credit was underperforming - and more noticeably that single-name credit was underperforming indices - suggesting forced long covering or horizon changes (from short to long) in macro to micro hedging. The indices in general did not initially follow ES but as the rally took hold they started to catch up (understandably so) but significantly underperformed ES as we closed.
AAPL was the story of the middle of the day as it failed to provide an iPhone 5 (all-singing-all-dancing awesomeness) and fell more than 5% at one point (testing its 200DMA) before ripping back higher to its VWAP and then a little more to close down around 0.6%. Once again - we have run out of adjectives to describe that kind of move in that market cap but whatever helped the market certainly saved a few hedge fund's years today!! Sectorally, it is more what we would expect from a bounce day - the heavily shorted and prime-for-a-short-squeeze financials ripped almost 6.5% higher in that last 45 minutes. Amazingly, MS is now +3.25% from Friday's close, rallying 14.5% in the last 45 minutes with Goldman and Wells Fargo also making into the green on the week. In CDS land, MS opened 645/665 and closed 555/575 (still a little wider on close) in 5Y but 1Y remains 780/850 and was active today - moves in other financials were similar in style to MS (glide rally, jump wider early afternoon, then gap tighter into close) but lesser magnitude.
Enough of the superlatives...TSYs did not get quite as excited. 30Y did manage a 11bps rise in yields from today's low yields but was only just above the earlier high yields - significantly off the levels of yesterday still (as equities test them).
There was modest underperformance in the 5-7Y TSY bucket and that fits with the heaviest net-buying in corporate bond land today seen in the 3-7 and 7-12Y buckets respectively. For some perspective on the moves in the indices relative to single-names today IG was 0.5bps tighter while its fair-value widened 7.5bps (massively cheap to the index now) and HY managed a 1bps compression on the day (as opposed to 48bps decompression in intrinsics) but we do note that short-dated HY was wider all day. Just for further perspective the equity move today is equivlent to 37bps more compression in HY and 5.5bps compression in IG - another point of evidence that the rally was overdone (but that's optically clear we assume).
FX saw the USD dump as AUD ripped higher as did every other major (apart from JPY) as carry FX took off - it was initially delayed in its response but once we got going in ES it didn't take long to rip. Precious metals and commodities all managed to rally back as the dollar lost ground with oil finding the day's highs but copper, gold, and silver all stayed well of the earlier day's highs. Silver clung to $30 at the close as oil peaked over $78. All-in-all - an unbelievable last 45 minutes to what was making sense as a day so far with Bernanke's perspective early on. While we would prefer to fade this equity strength, we would suggest a half/third unit size as these squeezes can extend incredibly - though that seemed to be what we saw today - especially in the banks. Late Update - by request our short-squeeze indicator shows two moments today that were good setups for notable potential squeezes - as the Goldman Short-Interest index hugely underperformed (which is good for shorts) and then greatly underperformed (squeezed) as the rallies came on...obviously not foolproof but nevertheless useful for some context.
Charts: Bloomberg
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| Welcome to the New Bear Market Posted: 04 Oct 2011 08:27 AM PDT What little good QE2 accomplished has now vaporized. Shortly after the open this morning, the S&P 500 dipped to 1,087 — 20% lower than the April 29 high of 1,363, thus meeting the formal definition of a "bear market." That much you've likely already heard if you were unfortunate enough to turn on your radio or TV. Here's what you likely haven't heard: 1,087 is only spitting distance from 1,049 — the level of the S&P on Aug. 26, 2010. That was the day Fed chief Ben Bernanke delivered his annual speech in Jackson Hole, Wyo., and signaled that a second round of "quantitative easing" was in the bag. The market's performance since then has been Bernanke's benchmark. Something to brag on. A point of pride…
Indeed it was. It is no more.
The Federal Reserve "will continue to closely monitor economic developments," said chairman Ben Bernanke during snoozer testimony to Congress this morning, "and is prepared to take further action as appropriate to promote a stronger economic recovery in a context of price stability." Funny, he didn't say squat about the stock market. In any event, the suggestion that the Fed is still standing at the ready to mainline more QE heroin was enough to ease traders' withdrawal pangs. The major indexes have bounced off their early-day lows. "Banks are still undercapitalized, overleveraged and still burdened by far too many derivatives," said GoldMoney's James Turk to King World News today. "The only uncertain thing is: On which side of the Atlantic will a major bank collapse? Because there are so many insolvent and fragile institutions around, it is hard to say which domino will topple first. I don't think investors fully understand at this point the potential ramifications. "When the first domino toppled in 2008, central banks stopped the contagion at Lehman, but they didn't solve the problem, which has now become larger and much more severe than it was three years ago. "What this means is that once the first domino topples, this event may be beyond the control of any one government or even central banks." What Mr. Turk is describing would be 2011's version of Creditanstalt, the private Austrian bank that collapsed in May 1931, intensifying the Great Depression. The contagion began in Austria, whose government responded with draconian measures. "The introduction of exchange controls in Austria," recalls Russell Napier in his book Anatomy of the Bear, "had created concern among depositors in German banks that the balance sheet of their institutions may be undermined. "As more than half of all German bank deposits were owned by non-Germans, a loss of confidence by these investors had very serious international consequences. There was a full-scale banking crisis in Germany by July, and exchange controls followed. As U.S. bank deposits in Austria, Hungary and Germany were frozen, the stability of U.S. bank balance sheets was further undermined." That encouraged Americans to pull their money out of U.S. banks. Total deposits shrank from $58.1 billion in December 1930 to $49.5 billion a year later. Between April-August 1931, 573 banks failed. In the following two months, the number accelerated to 827. Which brings us to the question: Who is a possible candidate for 2011's version of Creditanstalt? Dave Gonigam Welcome to the New Bear Market originally appeared in the Daily Reckoning. The Daily Reckoning provides over 400,000 readers economic news, market analysis, and contrarian investment ideas.
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| Posted: 04 Oct 2011 08:15 AM PDT Dave Gonigam – October 4, 2011
Shortly after the open this morning, the S&P 500 dipped to 1,087 — 20% lower than the April 29 high of 1,363, thus meeting the formal definition of a "bear market." That much you've likely already heard if you were unfortunate enough to turn on your radio or TV.
The market's performance since then has been Bernanke's benchmark. Something to brag on. A point of pride…
Indeed it was. It is no more. 
Funny, he didn't say squat about the stock market. In any event, the suggestion that the Fed is still standing at the ready to mainline more QE heroin was enough to ease traders' withdrawal pangs. The major indexes have bounced off their early-day lows.
"The only uncertain thing is: On which side of the Atlantic will a major bank collapse? Because there are so many insolvent and fragile institutions around, it is hard to say which domino will topple first. I don't think investors fully understand at this point the potential ramifications." "When the first domino toppled in 2008, central banks stopped the contagion at Lehman, but they didn't solve the problem, which has now become larger and much more severe than it was three years ago." "What this means is that once the first domino topples, this event may be beyond the control of any one government or even central banks."
The contagion began in Austria, whose government responded with draconian measures. "The introduction of exchange controls in Austria," recalls Russell Napier in his book Anatomy of the Bear, "had created concern among depositors in German banks that the balance sheet of their institutions may be undermined." "As more than half of all German bank deposits were owned by non-Germans, a loss of confidence by these investors had very serious international consequences. There was a full-scale banking crisis in Germany by July, and exchange controls followed. As U.S. bank deposits in Austria, Hungary and Germany were frozen, the stability of U.S. bank balance sheets was further undermined." That encouraged Americans to pull their money out of U.S. banks. Total deposits shrank from $58.1 billion in December 1930 to $49.5 billion a year later. Between April-August 1931, 573 banks failed. In the following two months, the number accelerated to 827. Which brings us to the question: Who is a possible candidate for 2011's version of Creditanstalt?
We pause here for three relevant statistics:
You can see how this might be a problem. Details of the rescue are still being worked out, but it "looks likely to involve a breakup of the bank's assets," anonymous sources tell Reuters, "and the creation of a state-supported 'bad bank.'"
Readers with keen memories will recall that Dexia played a prominent role in Federal Reserve ledgers that were finally thrown open earlier this year after Bloomberg went all the way to the Supreme Court to obtain them. It turned out Dexia was the biggest borrower from the Federal Reserve's discount window at the peak of the Panic of '08 — grabbing onto a $31.5 billion lifeline on Oct. 24.
"If Dexia went bankrupt, it could have been a catastrophe for municipal finance and money funds," recalled Matt Fabian of Municipal Markets Advisors. Dexia literally provided guarantees to buy the bonds if investors walked out. That made it possible for money market funds to buy the bonds. Yes, money market funds. The safest of all investment vehicles, or so we're always told. We pause here to note some additional relevant statistics…
But the vulnerability of money market funds to Greece is even bigger than these numbers indicate… because as noted above, the funds also hold municipal bonds guaranteed by the same European banks exposed to Greece. If this sounds like an accident waiting to happen, it is. In fact, it's another facet to the "mother of all bubbles" that Addison is warning about in his most recent forecast. We got quite a response to it over the weekend; if you haven't given it a look yet, here's your chance.
Driving the rumors were the fact 240 pilots retired in August and September, cashing in AMR shares at the Aug. 1 price — a phenomenon our short strategist Dan Amoss describes as a "virtual bank run."  AMR has been on Dan's "hit list" since early this year. And he sees more trouble ahead. "AMR lately has been paying high interest rates to roll over its debt — including loans collateralized by aircraft. "It's a terrible time to be raising junk debt. AMR still has a decent amount of liquidity, but lenders are looking ahead to distant debt maturities, estimating the amount of cash burn between now and then. They don't like what they see." As of yesterday, Dan's AMR short recommendation was good for a 67% gain. If you missed out on that play, there's no shortage of other candidates… as Dan shows you here.
Silver has broken below $30 again, to $29.79.
The first acquisition: $1 billion for European Goldfields, developer of the largest gold-mining project in… drumroll, please… Greece. Heh, gold mining might be the only remaining viable business in Greece. The investment amounts to a nearly 10% stake, according to the London Telegraph. Future targets for Qatar Holdings are in Africa and Russia.
 It's 99.999% pure and weighs 99.999 kilos. That's 1/10th of a metric ton, or if you prefer, 3,215 troy ounces. At today's spot price, that's worth nearly $5.2 million. And they have only two guys standing guard around it, we're told…
"As in the aftermath of World War II, people tend to trade and use instruments they know when others are no longer available. If the euro loses its ability to settle values, the many Europeans will be returning to what they knew before to do so." "I suggest that rumors regarding the printing of local currencies are signaling their return since the euro is 'lost in the welter of debt it enabled.' The problem with Greece right now is they are facing a collapse of any system to get payments to anyone in the country and they do not have the cash to start up printing drachmas again, even when they may have to. That is really down and out." "In a sense, the same thing is happening here. Utah signaled it when it legalized gold and silver for payments within the state."
"Why are they not marching on the Capitol Building in Washington, D.C., or the White House? The occupants of these buildings are the ones that have caused the most damage in our country. The parties on Wall Street that have made bad business decisions in the past would not be there today if the people in Congress, the White House and the Federal Reserve had not rescued them." "We have an election year coming up, and it would not surprise me to find out that some of the current occupants of Washington, D.C., are behind these demonstrations. Is there a better way to deflect attention away from what they have done than to shift the focus elsewhere? "The American Jobs Act, a certain person's recent road trip and now these demonstrations — something tells me there is more to this than a disgruntled few who decided to protest against executives making a large salary. Could it be that someone's agenda wants to highlight those salaries to promote their claim that they need to be taxed at a higher rate? I don't know for sure, but I wonder."
The 5: In 2005, about 35 Greenpeace protesters tried to take over the floor at the International Petroleum Exchange in London. The traders "kicked and punched them back on to the pavement," according to an account in the Times. Two of them landed in the hospital. "We bit off more than we could chew," said one demonstrator. "They were just Cockney barrow boy spivs. Total thugs." Electronic trading continued during the fracas. So even if the NYSE is invaded, the high-frequency computers will keep doing their thing, it would seem… Cheers, Dave Gonigam P.S. The only thing worse than a tax increase… is a retroactive tax increase. That's what the heirs of Connecticut developer and self-made millionaire Monty Blakeman face, to the tune of $100,000. Blakeman died on April 23. On May 4, the Connecticut legislature expanded the estate tax. Up to that point, it applied to estates of $3.5 million or more. Now the threshold is $2 million. And the law was made retroactive, applying to anyone who died after Jan. 1. "My dad said the state of Connecticut was making it harder and harder to stay in business," says son James Blakeman, who's suing the state. "They're already going to get a lot of money out of us." So it goes now, with cash-strapped state and local governments unable to print money to keep their many promises. Even if you don't have a net worth of $2 million, they're coming after you too… as Addison spells out in his updated forecast. You can review the laundry list of new taxes and weird fees — and help shelter your nest egg from the next round of assaults — by following this link.
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| Posted: 04 Oct 2011 07:58 AM PDT Recently, investors have suffered an average market decline of 6.5% in the equity portion of their investments, the largest fall since the dark days of October 2008, with $1 trillion of paper wealth evaporating in the process. Read More...
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| (Non) News Of Dexia "Bad Bank" Sends Market Soaring Posted: 04 Oct 2011 07:43 AM PDT
If anyone had any doubt this market is broken beyond compare and controlled by complete idiots, this should put all doubts to rest. Anyone wondering why stocks are soaring, the reason is that according to non-news, because this was first reported yesterday by the FT, Dexia will park €180 billion in worthless assets in a bad bank. This is beyond ridiculous as Belgium, even in JV with France, will be unable to ringfence and hence fund this amount of capital for the now nationalized bank. It also means that Belgium is about to be downgraded following a long-overdue warning by S&P and Moodys to cut the country. It also means that Belgian CDS will soon trade points up front. It also means that Belgian funding costs will soar. It also means that French CDS will explode tomorrow and that interbank markets in Europe will collapse (even more) once the market realizes that France has just diluted its "bailout dry capital" by rescuing a Belgian bank. And so on. And so on. But for now the ripfest is here. Fade every uptick as this is sheer desperation out of Belgium which pretends it is Switzerland and can do with Dexia what the Swiss did with UBS. Hint: it is not and no, it can't. From the WSJ Market Beat blog:
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| Posted: 04 Oct 2011 07:22 AM PDT Embry on Silver The CFTC has sort of pushed off the ruling on the position limits for a few weeks to give the large bullion bank with the enormous short position more time to deal with it. Part of dealing … Continue reading
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| Posted: 04 Oct 2011 07:22 AM PDT These past 9 years, with debt plaguing the performance of the dollar, have been quite interesting; watching the debt explode to the upside, and the dollar implode to the downside… But now, the Eurozone has taken on their own debt problems, and so it is that investors look for a safe haven… The US has debt coming out its ears, has had its credit rating downgraded, and has just scratched the surface of debt, with the unfunded liabilities staring us right in the face… The Eurozone peripheral countries, otherwise known as the PIIGS or GIIPS, whichever you prefer… for me, I just call them the debt ridden countries of the Eurozone! Well, the Eurozone no longer offers a respite from the dollar and all the US debt… I've said for some time now that the reason the euro (EUR) was able to maintain its very strong margin against the dollar was that the dollar was uglier… It was an ugly contest and the dollar was the winner… But guess who's catching up? The markets are looking over the euro with a magnifying glass these days, and they don't like what they see… Pimples, skin rashes, hairy growths… You name it… Not only does the dollar have them, but so too, the euro… And with that thought this morning, it's no surprise that the euro has taken on more water overnight, after falling in value versus the dollar all day yesterday. You know… I've told you over and over and over again that the euro is the offset currency to the dollar, which means that it's the Big Dog when it comes to anti-dollar currencies… And if the Big Dog gets off the porch to chase the dollar down the street, the little dogs (the other currencies) will too… Well… It goes both ways… If the Big Dog has been sent to the doghouse, the other little dogs get sent there too… And just like when the Big Dog was chasing the dollar down the street, the little dogs would go faster, thus outperforming the euro… I told you before all this began that a perfect storm was brewing for a short-term period of dollar strength… Well the little dogs are selling off faster than the Big Dog, too… It goes both ways, folks… And that's not to be flippant about it; just making certain that everyone understands what's going on… There's a black cloud out on the ocean, and it's heading toward the US… This black cloud is brought to you by our illustrious lawmakers, who are still hell-bent on telling everyone that China is responsible for all that ails our economy… Yesterday, I told you that there was a new bill circulating the halls on the hill that would pressure China to allow a faster appreciation of their renminbi (CNY)… I even heard the president applaud the coming of this bill… Let me explain what I mean by a black cloud heading toward the US. By passing this bill, the US could very well start a trade war with China… And there's this thing called "protectionism" that usually bangs a currency from a country that enacts protectionism. But that's on the side here… The thing that scares the bejeebers out of me is the fact that the U.S. has depended on China for almost a decade now, as the deficit spending exploded to the upside. They depended on China to show up at the Treasury Auctions with fists full of dollars, to buy our debt issuances (Treasuries)… But now, these elected officials believe that possibly ticking off a country that we've depended on, won't be a Big Deal… I don't agree with that… Not one iota! This is going to get ugly… And since we've become a debtor nation, which depends on the kindness of strangers, I don't think the "ugly" part is going to reside in China, but here… Of course the Chinese are already saying the right things… Like that they "regret" the Senate voting yesterday… The Chinese Foreign Ministry has already challenged that the bill violates the World Trade Organization (WTO) rules… But that's not where the problems reside in my opinion… Instead, a trade war is NOT what the world economy needs at this time… I've written about this before… Back in November of 2009, I had this to say about protectionism and trade wars… I'm not for any protectionism measures, as I see grave things or I should say, grave unintended consequences coming from protectionism measures… Can you say Smoot-Hawley? I thought you could! For non-history buffs, go ahead and Google Smoot-Hawley, and you'll see that most economists blame these protectionism measures as one of the key reasons the Great Depression was so bad. If you do not stop to learn from the mistakes that took place in history, then you will repeat them… it's that simple… So… Yes, the dollar is swinging a mighty hammer, and the currencies are getting hammered by the mighty hammer right now… But this could all come crashing down, should the markets get a good whiff of these protectionism measures that the US is implementing… So… If the currencies become embroiled in a trade war, what will be the shining light for investors? Whoa, there partner… If you thought I was going to go out on a limb, and possibly lose my job by saying what investment I think is going to be the shining light, and then it doesn't, and the lawsuits come flying in the door… You're mistaken… I would never get on that ship named "Chance"… However, I can tell you that in my opinion, which of course could be wrong… I would look to gold… Speaking of gold… Well.. It was up $15 when I came in, but is now up only $8… But still, it's up versus the dollar which is something all the other currencies can't say, not even Japanese yen (JPY), or Chinese renminbi today! The shiny metal has slowly risen from its brief dip below $1,600… I prefer these smaller moves in assets, especially gold, given the propensity for the "afterhours trades" to increase when the upside moves are larger for gold. That's a wink, when I talk about the "afterhours trades"… I have quite a few readers that have taken the ball on my challenge to research these "afterhours trades" on their own, and then let me know if they agree that the price of gold and silver is being manipulated… Well, most of them send me stuff they read, that explains the price drop of gold and silver, and most of them all talk about the price manipulators, or "banksters" (the bullion banks) as one article calls them… I think that the more the public is aware of what I feel is going on here, and I'm not the only one, maybe they will petition the regulators and get to the bottom of this! In Australia overnight, the Aussie dollar (AUD) plummeted to the 94-cent handle, a level we hadn't seen in a year… And now after a couple of months of saying that they weren't entertaining a rate cut, the Reserve Bank of Australia (RBA) is beating around the bush with a bias to cut rates… Well, probably not the RBA, but the markets are putting words in the RBA's mouth… RBA Governor Stevens last said that, "an improved inflation outlook would increase the scope for monetary policy to provide some support to demand, should that prove necessary." Basically, that's central bank parlance for… "If you want a rate cut, you'll have to wait until inflation falls"… The markets are beginning to believe that inflation for Australia is going to even out around 2.5%, which is still higher than the 2% target ceiling, but lower than the previous figure of 3%… So, the markets believe this will be enough to get Stevens to cut rates… And for that… Not reality, the Aussie dollar is getting sold… Go figure… Weren't the markets all wrong a couple of months ago, when they called for a rate cut, and never got one, then? The price of oil has really hit the slippery slope, eh? Yes, I like that when I go to the gas station… And it's much better for the US economy… But, it doesn't play well, and share its toys with the petrol currencies of: Canada, Norway, UK, Mexico, Brazil and Russia… So… On top of the dollar strength, these currencies lose even more because the price of oil is taking a ride on the slippery slope. So… Do you believe the price of oil is going to continue to go south/down? Or the Southbound Train Going Down? I guess, if the global recession comes about because of the newest version of Smoot-Hawley, then the price of oil will continue on the Southbound Train Going Down… Then there was this… From The Baltimore Sun… The US futures regulator delayed a final vote on controversial measures to crack down on excessive speculation in commodity markets because it lacks the three votes needed for approval, sources familiar with the situation told Reuters on Wednesday. The US Commodity Futures Trading Commission announced on Tuesday it was delaying by another two weeks to October 18 its meeting to consider the long-awaited rule on position limits. It was the second time a vote had been postponed. What? Just what the heck is going on at the CFTC? They can't see what's been going on, and the need to pass a measure to crack down on excessive speculation? Are there "outside" forces putting pressure on the CFTC to not vote on this measure? One would have to think there is, otherwise the CFTC would do what's right for the people of the United States! To recap… The perfect storm for dollar strength that I talked about weeks ago is beginning to really set in, with the dollar hammering the currencies (not gold, though!)… The big news is that congress is going ahead with the bill to place pressure on the Chinese to allow a faster appreciation of the renminbi… Chuck thinks this is going to ignite a trade war, and possibly bring back the ghost of Smoot-Hawley… The petrol currencies are especially taking it on the chin, due to the drop in oil prices… Chuck Butler The Ghost of Smoot-Hawley? originally appeared in the Daily Reckoning. The Daily Reckoning provides over 400,000 readers economic news, market analysis, and contrarian investment ideas. More articles from The Daily Reckoning….
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| US Dollar Gains Huge Chunks of Ground Posted: 04 Oct 2011 07:22 AM PDT Gold has picked up the pieces of its drop, and is rallying this morning, with it up right now: $34… As I walked by Aaron's desk on Friday, he stopped me to show me a video of a news reporter saying something like… Investors should not buy gold, but should instead hold dollars, because…dollars are backed by the US government, and gold is backed by nothing… I wanted to reach into his computer, grab the reporter by the neck and shake him! Why would he be spewing such garbage? Sure the dollar is backed by the government…but isn't that same government that has done just about everything it can do to weaken the dollar, and reduce holders of dollars' purchasing power? And takes every opportunity it can to point out that the Chinese currency needs to appreciate versus the dollar? So, what good is it to have a government backing a currency if in essence they don't back it at all? They instead opt to make one bad choice after another that causes the dollar to weaken more every year? And gold… Let's see… Sure no country backs gold… THAT'S WHAT MAKES IT SO DARN VALUABLE! No government making bad choices… No government laying claim to it… No government affixing their liabilities to it… Sure we all, here in America, need to have dollars for gas, groceries and giggles… But beyond that… Give me gold! I talked about this in my radio interview yesterday… So, for anyone who listened in, this is a repeat tirade! But that's about as far as I can go with regards to assets rallying versus the dollar, this morning. The dollar is in the drivers' seat, and the currencies don't look good… Japanese yen and Chinese renminbi (CNY) have eked out small gains versus the dollar this morning, but they are very small… European finance ministers are meeting in Luxembourg today, but this time they aren't meeting to toss around the ideas for a hoola-hoop for the Eurozone debt problems… In the past, the idea that they were meeting to discuss ideas would underpin the euro (EUR), and thus the remainder currencies… But this meeting isn't about "ideas" to solve the problem… This meeting is about weighing the threat of a Greek default. And to discuss whether or not Greece has done enough to qualify for another tranche of bailout funds… But, the euro has to feel as though it's getting hit on both sides now, because not only does it have these debt problems beating on it daily… But now, the Eurozone economic data is beginning to show signs of a major slowdown, even recession. In fact, even Germany is beginning to feel the pinch, and that's not a good thing for the euro, for Germany has been the shining light that has underpinned the euro while the debt plagued countries of Portugal, Ireland, Italy, Greece and Spain, remain in the news daily. The PIIGS as the markets call them.. and all this bailing out of the PIIGS reminds me of the saying I used to say long before Sarah Palin borrowed it… You can put lipstick on a pig, but…it's still a pig… All things being equal, and if we don't see a Greek default this week, we could very well see a direction cut out for the euro this Thursday, when the European Central Bank (ECB) meets to discuss rates… The markets are of the thought that the ECB will cut rates, to promote growth, and thus add to the problems for the euro this morning… But… If you think like me, (and may your lord protect you if you do!) you'll be of the opinion that the ECB will NOT cut rates this Thursday, given the latest inflation reports which had inflation in the Eurozone at 3%, well above the ECB's target rate of 2%. And, so it could be, that once the ECB leaves rates unchanged, that all the sell orders that are in ahead of what they thought would be a rate cut, could very well be reversed, and support for the beleaguered euro would come… Maybe, just maybe… So… The currencies like the Aussie dollar (AUD), kiwi (NZD), Canadian dollar/loonie (CAD), and others, are trading at 2011 lows… That's right… All the great moves we saw in these currencies during 2011 have been erased, and we're back to 2010 levels… Hmmm… Well… I guess all those people that for years have said they were finally going to buy gold and currencies to diversify their investment portfolio, can now load up at these bargain prices! Hey… There's always a good time to buy at bargain prices, eh? So, that holds true for investors that have already diversified their investment portfolio with currencies and metals… It's a bargain price for them too! You know… The countries of Switzerland and Japan are to blame for a lot of this dollar strength (shoot, even Brazil qualifies here)… Investors were flocking to alternative currencies other than the dollar… But those countries intervened to prevent their base currency from appreciating versus the dollar. So, by de-facto default, investors went back to dollars, which as the reserve currency of the world, remains the most liquid currency… But what happens when things go to hell in a hand basket with the US economy? Ahhh grasshopper, we're about to find out… Soon… On Friday, we saw the color of the latest Personal Spending and Income reports… Spending rose in August, and income fell… Not a good combination there. Wages fell -0.1% in August, reversing the 0.1% increase in July… Look… Wages here in the US have gone nowhere for almost a decade now, but have really fallen out of bed this year, and is another reason the US recession continues… Wages are falling… Unemployment keeps climbing… But… People surveyed by the U. of Michigan are confident… Go figure… Today, we'll see the ISM Manufacturing Index, which is hanging by the skin of its teeth to the 50 level which is the line in the sand that decides if manufacturing is contracting or expanding… Once the index falls below 50, you can figure that the US economy is stuck in the mud… Now, we all know it is already, but some people need to see things like the ISM falling below 50 to prove it to them. This will be a HUGE data risk week across the board. I already told you about the ECB meeting on Thursday… And here in the US we get today's ISM, tomorrow, Factory Orders, and Big Ben speaking on the economy, and probably explaining his comment last week that the US unemployment problem was a "national crisis". And then on Friday, the Jobs Jamboree will print, and it will be ugly, folks… That's my prognostication for the Jobs Jamboree… And then there will be lots of smaller data prints sprinkled throughout the week… In Canada this week, they too will print their Manufacturing Index report (PMI) and if I've added up the positive data prints correctly for the past month, I would say that Canadian PMI will remain well above the 50 level… Thus illustrating the tale of two countries… I know this will sound a little harsh toward the Greeks… But… Every time I see them rioting because they are having to pay their debts, it just really bothers me… Yes, that's over there, and away from here, but… That's where I say, just because it's over there, doesn't mean it can't happen here, when one day we are told that we have to pay back our debts… Debt, whether it's in Greece or the US is debt… You can rearrange the deck chairs on the Titanic all you want; the debt has to be repaid… Someday… And before I head to the Big Finish… I see where US lawmakers are once again considering a bill that would pressure China to allow a faster appreciation of the renminbi versus the dollar (here they go again, wanting the dollar to be weaker; if it were me, I would pass on that kind of backing!)… Look, folks… I've said this quite a few times in the past… But there's always going to be a country that can make stuff cheaper, if given the capital to do so… So, if you make China's currency more expensive, there'll be another country to produce things cheaper… I think you're playing with fire when you are messing with the Chinese, who have financed our debt for the past decade now. Then there was this… From CNN Money… Economists are convinced the euro will survive as a currency without losing any members…not even Greece. Of the 22 economists surveyed by CNN Money, 17 are predicting that the euro will hold together, even though almost all of them believe Greece will default on its debt by the end of next year. Default speculation has led to fears that the Eurozone will break apart. But economists say the barriers to exiting the euro are too significant to make it a viable option, even with a looming default. "The benefit of leaving the Eurozone is simply not strong enough for a country to leave," said Russell Price, senior economist for Ameriprise Financial. A Greek default is 93% priced in… That's up from 91% a few weeks ago… I don't see how defaulting and not leaving the euro helps the Greeks. Leave the euro, go back to the Drachma devalue the currency to the bone, pay back your debts, and begin to build a strong foundation without debt, so that one day you can rejoin the euro… I know that all sounds easy here… And it won't be, for sure… But I don't see how defaulting but remaining in the euro helps Greece… At the same time, I don't see Greece leaving the euro as a "garden trip"… So, it will be painful, but no pain, no gain… And of course that's all easy for me to say, as I sit here eating my chocolate bonbons, and watching TV! HA! To recap… The currencies are sliding further this morning, led by the euro, with only the Chinese renminbi and Japanese yen eking out gains versus the dollar. Gold, however, is stronger by $34 this morning, and is beginning to look like it has left its brief dip below $1,600 in the rearview mirror. There is lots of data risk this week in the US, Canada, and Eurozone, with the Big Jobs Jamboree at the end of the week. Chuck Butler US Dollar Gains Huge Chunks of Ground originally appeared in the Daily Reckoning. The Daily Reckoning provides over 400,000 readers economic news, market analysis, and contrarian investment ideas. More articles from The Daily Reckoning….
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Millions of Americans are about to get stabbed in the back by their banks. Bank of America, JPMorgan Chase, Wells Fargo, Citibank and several other large banks are either already implementing outrageous new bank fees or are currently testing them. So are these ridiculous new bank fees going to be enough to get millions of Americans to finally boycott the big banks? When millions of Americans start paying a $5 fee every month to use their debit cards and when millions of Americans start paying a $20 fee every single month just to have a checking account hopefully that will be enough to wake them up. These fees are certainly not going to cause an "economic collapse", but they are incredibly annoying. The truth is that the big banks are trying to take advantage of us. It shouldn't cost $60 a year just to use a debit card. It shouldn't cost $240 a year just to have a checking account. What we need to do is to send an unequivocal message to the big banks: we don't want your stinking bank fees and we are switching banks.
King World News is continuing to get reports from sources around the world regarding tremendous physical demand in both gold and silver. One source out of Norway told KWN, "What I can report from Norway, and as you know we are not part of the euro system, we are experiencing an extreme increase in physical demand for bullion, both in silver and also in gold." This report came in from Martin Mesicek, from Gold Source, the largest bullion dealer in Norway.
With stocks turning higher, gold near $1,625 and silver at $30, today King World News interviewed one of the most street smart pros, Rick Rule, Founder of Global Resource Investments, which is now part of the $10 billion strong Sprott Asset Management. When asked about the tremendous volatility and wild swings in all of the markets, Rule responded, "What I see happening is a crisis of confidence. The market disarray in 2008 was famously attributed to black swans. As we've talked about before, there seem to be so many (black) swans on the horizon now that they resemble a cloud."
Wow, this is really getting ugly. Metals down. Miners down. Yuck. Can it get worse? You bet it can. How much? I guess that depends upon whether or not this is "IT".
With stocks continuing to struggle and the gold holding near the $1,620 area, today King World News interviewed John Embry, Chief Investment Strategist of the $10 billion strong Sprott Asset Management. When asked about the action in gold and stocks, Embry responded, "I think a lot of it relates to what's happening in the stock market. Despite the best efforts of the Plunge Protection Team, the stock market had two brutal days. On Friday, the last day of September, they couldn't hold the Dow above 11,000. Once again, yesterday, despite their best efforts it plunged again."
Welcome to the new bear market. What little good QE2 accomplished has now vaporized.
Here's what you likely haven't heard: 1,087 is only spitting distance from 1,049 — the level of the S&P on Aug. 26, 2010. That was the day Fed chief Ben Bernanke delivered his annual speech in Jackson Hole, Wyo., and signaled that a second round of "quantitative easing" was in the bag.
The Federal Reserve "will continue to closely monitor economic developments," said chairman Ben Bernanke during snoozer testimony to Congress this morning, "and is prepared to take further action as appropriate to promote a stronger economic recovery in a context of price stability."
"Banks are still undercapitalized, overleveraged and still burdened by far too many derivatives," said 
What Mr. Turk is describing would be 2011's version of Creditanstalt, the private Austrian bank that collapsed in May 1931, intensifying the Great Depression.
The French and Belgian governments are stepping in today to save Dexia, a French-Belgian bank with major exposure to Greece.
This wouldn't be Dexia's first rescue. Not by a long shot.
Why was the Fed so eager to help Dexia? Because Dexia guaranteed a boatload of municipal bonds in this country — everything from the Texas Veterans Land Board to the Los Angeles County Metropolitan Transportation Authority.
Shares of American Airlines parent AMR are recovering today after shaking off rumors of imminent bankruptcy — a major factor behind yesterday's sell-off.
Despite Ben Bernanke dangling the prospect of more QE, gold is selling off. The spot price is holding above $1,600, but at $1,614, it's down significantly from where it was overnight.
Knowing a bargain when it sees it, Qatar's sovereign wealth fund is about to plow $10 billion into gold producers.
For sheer ooh-and-ahh impact, check out this gold bar on display recently at a shopping center in Nanjing…
"Old Spanish currencies are circulating now in Spain in many cities and towns," writes a reader who noted the rumor last week that Germany is printing deutsche marks in case of a euro collapse.
"The people who are demonstrating on Wall Street and other locations around the country seemed to have chosen the wrong location to vent their frustrations," writes another reader.
"I'm waiting for the day," writes another, "the demonstrators actually invade a trading floor and stop the trading! What do you think will happen then?"| You are subscribed to email updates from Save Your ASSets First To stop receiving these emails, you may unsubscribe now. | Email delivery powered by Google |
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