Gold World News Flash |
- Gold Stocks: 30 Minute Chart Tool In Play
- All the #occupy protestors in the world don’t amount to one Eric Sprott…If he decided to pull the pin on these guys. JUST DO IT!!!!!
- John Hathaway - Desperate Fed to Provide Unlimited Liquidity
- Is the Total Economic Collapse of the U.S. Nearly Upon Us?
- GoldSeek.com and SilverSeek.com Announces Re-Launch of Web Sites
- Gold Seeker Closing Report: Gold and Silver Rise In Late Trade and End With Decent Gains
- California's Public Pension Disaster
- Shrinking Margin of Safety
- UBS' Advice On What To Buy In Case Of Eurozone Breakup: "Precious Metals, Tinned Goods And Small Calibre Weapons"
- UBS' Advice On What To Buy In Case Of Eurozone Breakup: "Precious Metals, Tinned Goods And Small Calibre Weapons"
- HeadLie: Withdrawing Your Money From Banks Will Make The Recession Worse
- Remember That Little Housing Bubble?
- 20 Signs That The Culture Of Government Dependence Has Gotten Completely And Totally Out Of Control
- Gold FIX Driving the Price
- Gold and Silver Rebound / OI on Silver and Gold Continue to Fall / Investors Go Straight to Mining Companies For Metal
- Jon Pleads 5th?
- Literati!
- The Endgame: Japan Inc. Plays By Its Own Rules
- Has The Imploding European Shadow Banking System Forced The Bundesbank To Prepare For Plan B?
- Timing China's Financial Meltdown and Housing Market Crash
- Gold Price Near the Trendlines is a Good Time to Buy
- Sprott Frustrated With Hostage-Taking Paper Silver Market
- Gold Price to ‘Double’ in 2012, says Guru
- Despite Bazooka Rumor, Equities End Unch As Commodities Surge
- A New Theory of Government…
- Gold Breaking Mutliple Support Lines
- $2000 Is Coming Into View
- Interview with Ranting Andy Hoffman 12-6-11
- Gold Daily and Silver Weekly Charts - Another Bear Raid Down to Support That Fails
- Note to Greeks: whatever’s not in gold and silver, you’ll lose
| Gold Stocks: 30 Minute Chart Tool In Play Posted: 06 Dec 2011 06:11 PM PST Graceland Update
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| Posted: 06 Dec 2011 06:08 PM PST Sprott Frustrated With Hostage-Taking Paper Silver Market
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| John Hathaway - Desperate Fed to Provide Unlimited Liquidity Posted: 06 Dec 2011 06:04 PM PST  With investors wondering where the next major move is for gold and silver, today King World News interviewed four decade veteran, John Hathaway, the prolific manager of the Tocqueville Gold Fund. Many investors are on edge, waiting for a resolution to the European problem. Hathaway had this to say about what central planners face today, "Oh, it's terrible, it's really terrible. Then answer to all of these issues, in terms of what they are proposing, is austerity. Well that's fine if you are a technocrat like the new head of Greece or the new head of the European Central Bank or the new guy in Italy. I mean these guys are all technocrats."
This posting includes an audio/video/photo media file: Download Now |
| Is the Total Economic Collapse of the U.S. Nearly Upon Us? Posted: 06 Dec 2011 04:49 PM PST by SGT, SGTreport.com:
Is the total economic collapse of the United States nearly upon us? Three dramatic recent events suggest that it may be. 1. The collapse of MF Global. Combined with the outright theft of segregated customer accounts and the total failure of the CME to live up to its fiduciary responsibility to insure those customer accounts – an event that has never, ever happened before – this calamity suggests that the sanctity and reputation of the financial markets is no longer a priority or even a concern. Why? It seems the final looting has begun. 2. The passage of the National Defense Authorization Act, S. 1867. Traitorous United States senators – with no regard to the U.S. Constitution – have granted the United States military the ability to indefinitely detain American citizens without writ of habeas corpus, and hold them in hidden gulags of the military's choosing. Re-read that sentence please. If you are not chilled to the bone at the thought of the atrocities that may lay ahead, well, I can't help you. Why the rush to get this tyrannical legislation in place? Why now? Furthermore, given the growing Patriot movement in America, the burgeoning Ron Paul Revoution and the growing anger of the American people – where the hell could the military even possibly detain hundreds of thousands, or millions of us? 3. That's where the real live FEMA camps come in. According to infowars.com leaked documents from an insider about Halliburton subsidiary KBR reveal current on-going operations to staff the FEMA and U.S. Army camps it runs around the United States. According to the information, KBR is contracting services for temporary fencing and barricades, laundry and medical services, power generation, refuse collection, catering and other services required for temporary "emergency environment" camps located in five regions of the United States. As Aaron Dykes notes, disturbingly, this comes immediately after the Senate passed the National Defense Authorization Act (NDAA), including the controversial amendment to the bill which allows the indefinite detention of American citizens. All this at a time which economic conditions and mass demonstrations sweep the country and threaten potential unrest. So taken together, the collapse of MF Global along with the outright looting of segregated customer accounts, the ability for the military to arrest and detain American citizens AND the existence of fully operational FEMA camps around the United States in which to place American citizens, it appears to this writer that the final pieces of a Fascist tyrannical puzzle are nearly in place. We know from Joe Biden's own words that the Obama administration consulted with former Goldman CEO and MF Global arch-criminal Jon Corzine about the potential for a U.S. banking holiday as recently as 2009. The world financial picture has deteriorated greatly since then. It is my opinion that the orchestrated total economic collapse of the United States may now come in the very near future. Heaven help us. The Real Enemies of Humanity US Set to Use Army to Put Down Protests
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| GoldSeek.com and SilverSeek.com Announces Re-Launch of Web Sites Posted: 06 Dec 2011 04:30 PM PST We are pleased to announce the re-launching of our entirely new GoldSeek.com and SilverSeek.com websites on December 15th. The sites have been re-designed and built from the ground up to create an exciting, new, clean look and feel, backed by a powerful new website engine that will support our record traffic demands. The new aesthetics will deliver greater balance with well-organized gold, silver and financial information along with many new features providing great usability.
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| Gold Seeker Closing Report: Gold and Silver Rise In Late Trade and End With Decent Gains Posted: 06 Dec 2011 04:00 PM PST Gold erased early Asian losses and bumped up to $1722.92 by about 3:30AM EST before it fell all the way back to $1702.00 by a little after 10AM EST, but it then rallied back higher for most of the rest of trade and ended with a gain of 0.44%. Silver rose to as high as $32.364 in Asia before it dropped back to $31.595, but also rallied back higher in New York and ended with a gain of 2.69%.
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| California's Public Pension Disaster Posted: 06 Dec 2011 03:13 PM PST  California has promised its public employees lavish pensions and retiree health benefits without setting aside nearly enough money to pay for those benefits. As a result, California already admits to a $75.5 billion shortfall in paying for these promises to public employees—$40.5 billion for the teachers' retirement plan (California State Teachers' Retirement System, or CalSTRS) and $35 billion for the California Public Employee Retirement System (CalPERS).As the pension and health-care benefit crisis sweeps across the nation, some states are seriously dealing with these multibillion-dollar problems that threaten public services and treasuries. And other states remain in deep denial. California, to no one's surprise, is moving stridently in the wrong direction. That continues a troubling trend that's been building for years, one that has had a particularly harsh effect on black workers. While the private sector has been adding jobs since the end of 2009, more than half a million government positions have been lost since the recession. A new estimate from the state's public retirement system shows a change in benefits could prove costly. Earlier this fall, lawmakers asked the retirement system to run some numbers. They wanted to know how much it would cost employers- that are the state, cities and towns - if New Hampshire went from a defined benefit plan to a defined contribution plan. Going from a system where the employers are responsible for guaranteed benefits, to one where employers only guarantee they pay a certain contribution. Initial numbers from the retirement system's actuarial firm are sobering. Read more.... 
This posting includes an audio/video/photo media file: Download Now |
| Posted: 06 Dec 2011 02:40 PM PST December 6, 2011 [LIST] [*]People are still listening to S&P? Really? Well, if that’s the case, here’s a chart you should inspect carefully... [*]The redefinition of “safety,” continued: Jim Nelson with new case studies on the search for yield in a zero-interest world [*]Sideways market, today and for the last four months: Chris Mayer unearths wisdom from 1917 that still applies [*]World’s wealthy scramble to grab physical gold: Where they’re buying now [*]Gold commercial banned from network TV... a reader’s inquiry about the payroll tax cut... a passionate debate about Mexican dentistry (no lie)... and more! [/LIST] Far and away the most important thing to happen since yesterday’s issue is this: We’re learning once again that people still take the prattling of the rating agencies seriously. In a sensible world, your editor’s iPad would not have gone off every hour or so yesterday with a market-moving...
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| Posted: 06 Dec 2011 02:36 PM PST Three months ago, Zero Hedge presented the first of many narratives that started the thread of explaining the "unmitigated disaster" that would ensue should the Euro break up, which in the words of authors Stephane Deo and Larry Hatheway, would leads to such mutually assured destruction outcomes as complete bank failure and/or civil war or far worse. Because if there is one thing the banks have learned in the aftermath of Hank Paulson, is that scaremongering when bonuses are at stake is the only to get taxpayer money to fund exorbitant lifestyles. Unfortunately since the first UBS report, despite the best intentions of the status quo, the Eurozone's plight has only gotten far, far worse, reaching a Lehman-like crescendo when the house of cards threatened to collapse if not for a last minute Fed rescue. However, as Deutsche Bank and every other bank knows well, that measure was merely a short-term fix. Today, Larry Hataway has released yet another sequel to the original piece, focusing on this so very critical week for Europe, which as Olli Rehn said, must find a solution by Friday or see the EU "disintegrate", in which the vivid imagery, loud warnings and level of destruction are even greater than before. In other words, Europe has 4 more days, something which S&P tried it best to remind Europe of, as the alternative is "or else." And here comes UBS to remind everyone that anything but a "fix" to a system that was broken from the very beginning, would be a catastrophe, captured probably the best in Hatheway's recommendations of assets to be bought as a hedge to a Euro collapse: "I suppose there might be some assets worthy of consideration—precious metals, for example. But other metals would make wise investments, too. Among them tinned goods and small calibre weapons." But even that is nothing compared to the kicker: "Break-up runs the risk of becoming one wretched scenario. Sadly, however, it can't be ruled out, just as it would have been improper to rule out the horrors of the first half of the 20th century before they happened." And there you have it: a reversion by Europe to the perfectly stable system from a decade ago, is now somehow supposed to result in World War. And with that the global banking cartel has official jumped the shark, just like the FT's latest rumor earlier today did the same by indicating that the well of European "bailout" ideas has officially run dry. Here is how Hatheway frames the end of the world:
Why a euro break up is the end of the world: Take 1 - base case
Why a euro break up is the end of the world: Take 2 - crank it up a notch
Why a euro break up is the end of the world: Take 3 - bring up the cheating spouse analogy: that will get their attention
Why a euro break up is the end of the world: Take 4 - time for some carpet bombing imagery "inception"
Why a euro break up is the end of the world: Take 5, epilogue, or how "you damn dirty apes blew it all to hell"... and by it we mean our bonuses
At this point we have to say that we find it supremely ironic that a man warning against the futility of linear forecasts does just that for 4 pages, and all based on the flawed premise that returning the system that actually worked, would be tantamount to the apocalypse. Yet as Hatheway says, let's hope that "Europe's politicians agree"... although agree with what is not quite clear - to fund the existence of an obvious fiscal and monetary experimental failure at the expense of trillions more in diluted or outright confiscated funds, just so the continent's (and world's) bankers, who outside of writing trite essays have no utility in the real world, get another massive outlier of a bonus? That actually sounds about right. As for us, we will bet on the fact that as in every historical event in the past 20 centuries, the powder keg that is Europe, with its tens of religions, hundreds of mutually exclusive cultures, and millennia of hatred, almost without fail took the decision that led to massive game theory fail, and an outcome that resulted in bloodshed. Which is why the only take home message for us here is to do precisely what Hatheway warns to do as a euro breakup Plan Z: buy gold, spam and guns. Everything else we leave to the only market makers left in town - the world's central banks.
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| Posted: 06 Dec 2011 02:36 PM PST
Three months ago, Zero Hedge presented the first of many narratives that started the thread of explaining the "unmitigated disaster" that would ensue should the Euro break up, which in the words of authors Stephane Deo and Larry Hatheway, would leads to such mutually assured destruction outcomes as complete bank failure and/or civil war or far worse. Because if there is one thing the banks have learned in the aftermath of Hank Paulson, is that scaremongering when bonuses are at stake is the only to get taxpayer money to fund exorbitant lifestyles. Unfortunately since the first UBS report, despite the best intentions of the status quo, the Eurozone's plight has only gotten far, far worse, reaching a Lehman-like crescendo when the house of cards threatened to collapse if not for a last minute Fed rescue. However, as Deutsche Bank and every other bank knows well, that measure was merely a short-term fix. Today, Larry Hataway has released yet another sequel to the original piece, focusing on this so very critical week for Europe, which as Olli Rehn said, must find a solution by Friday or see the EU "disintegrate", in which the vivid imagery, loud warnings and level of destruction are even greater than before. In other words, Europe has 4 more days, something which S&P tried it best to remind Europe of, as the alternative is "or else." And here comes UBS to remind everyone that anything but a "fix" to a system that was broken from the very beginning, would be a catastrophe, captured probably the best in Hatheway's recommendations of assets to be bought as a hedge to a Euro collapse: "I suppose there might be some assets worthy of consideration—precious metals, for example. But other metals would make wise investments, too. Among them tinned goods and small calibre weapons." But even that is nothing compared to the kicker: "Break-up runs the risk of becoming one wretched scenario. Sadly, however, it can't be ruled out, just as it would have been improper to rule out the horrors of the first half of the 20th century before they happened." And there you have it: a reversion by Europe to the perfectly stable system from a decade ago, is now somehow supposed to result in World War. And with that the global banking cartel has official jumped the shark, just like the FT's latest rumor earlier today did the same by indicating that the well of European "bailout" ideas has officially run dry. Here is how Hatheway frames the end of the world:
Why a euro break up is the end of the world: Take 1 - base case
Why a euro break up is the end of the world: Take 2 - crank it up a notch
Why a euro break up is the end of the world: Take 3 - bring up the cheating spouse analogy: that will get their attention
Why a euro break up is the end of the world: Take 4 - time for some carpet bombing imagery "inception"
Why a euro break up is the end of the world: Take 5, epilogue, or how "you damn dirty apes blew it all to hell"... and by it we mean our bonuses
At this point we have to say that we find it supremely ironic that a man warning against the futility of linear forecasts does just that for 4 pages, and all based on the flawed premise that returning the system that actually worked, would be tantamount to the apocalypse. Yet as Hatheway says, let's hope that "Europe's politicians agree"... although agree with what is not quite clear - to fund the existence of an obvious fiscal and monetary experimental failure at the expense of trillions more in diluted or outright confiscated funds, just so the continent's (and world's) bankers, who outside of writing trite essays have no utility in the real world, get another massive outlier of a bonus? That actually sounds about right. As for us, we will bet on the fact that as in every historical event in the past 20 centuries, the powder keg that is Europe, with its tens of religions, hundreds of mutually exclusive cultures, and millennia of hatred, almost without fail took the decision that led to massive game theory fail, and an outcome that resulted in bloodshed. Which is why the only take home message for us here is to do precisely what Hatheway warns to do as a euro breakup Plan Z: buy gold, spam and guns. Everything else we leave to the only market makers left in town - the world's central banks.
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| HeadLie: Withdrawing Your Money From Banks Will Make The Recession Worse Posted: 06 Dec 2011 01:28 PM PST by Mac Slavo, SHTFPlan.com:
In case you haven't yet heard, the Greeks are quietly continuing with a run on their banking system, a situation we've reported on previously, and one that British EU minister Nigel Farage warned of just a few short months ago. Savings and time deposits have dropped 30% since the start of the year and almost 10% was withdrawn in just September and October. It's not panic in the streets – not yet, at least – but it's getting close. Der Spiegel reports: Many Greeks are draining their savings accounts because they are out of work, face rising taxes or are afraid the country will be forced to leave the euro zone. By withdrawing money, they are forcing banks to scale back their lending – and are inadvertently making the recession even worse. This headline description for the Der Spiegel article suggests that it is the fault of the Greek people that the country's recession – more appropriately, depression – continues to worsen.
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| Remember That Little Housing Bubble? Posted: 06 Dec 2011 01:17 PM PST from WealthCycles:
A reserve ratio is the percentage of cash, usually determined by a country's central bank, that a bank must keep on hand to satisfy depositors. Under a 10% reserve ratio, a bank can take a $100 deposit, and lend out $90—keeping 10% of the total deposit on hand. When a central bank cuts reserve ratios, the banks can lend out more currency. The latest on China out of the Wall Street Journal depicts a central bank worried about a number of factors: falling real estate prices, slowing consumer demand, a stalled-out export market, and heavy concerns in the manufacturing sector. The data point to major problems. And while they might not rear their ugly heads before the end of this calendar year, we all know these problems will pop up eventually.
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| 20 Signs That The Culture Of Government Dependence Has Gotten Completely And Totally Out Of Control Posted: 06 Dec 2011 01:12 PM PST from The Economic Collapse Blog:
More Americans are financially dependent on the government than ever before. For a variety of reasons, there are now tens of millions of Americans that would not be able to survive without government assistance. As I wrote about the other day, the insane economic policies of our "representatives" in Washington D.C. have created a situation where there are not nearly enough decent jobs for everyone. So the job market has become a giant game of "musical chairs" and a lot of American families have been left out in the cold when the music has stopped. Of course we are not going to let them starve in the streets. There are also some Americans that simply do not have the capacity to take care of themselves. It is certainly the compassionate thing to do to give them a helping hand. However, with all of that said, we also have to face the fact that we have created a "culture of dependence" in this country. Americans that are now in their prime working years have been taught all of their lives that the government is going to take care of them from the cradle to the grave. This culture of government dependence has gotten completely and totally out of control, and now nearly half of all American households receive some form of government benefits. As a result, our debt is absolutely exploding, everyone looks to the government to solve our problems and very few Americans seem to possess a very strong work ethic any longer. Read More @ TheEconomicCollapseBlog.com
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| Posted: 06 Dec 2011 01:00 PM PST In the last couple of weeks, we've noticed the variance of the gold Fixing price and the open market price. In the past, the two tended to dovetail giving the appearance of synchronicity. But in the last week, open market prices have tried to take the gold price down only to be pulled up by the price established at the London gold Fixing. There is a structural change happening in the market, bringing the relevance of the physical market to a far more important pricing role that it has had before.
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| Posted: 06 Dec 2011 11:54 AM PST by Harvey Organ: Good evening Ladies and Gentlemen: The banking cartel showed up for work today in the wee hours of the morning. They knocked gold down to around $1701.00 and silver below $31.50 but both metals clawed their way back close to positive territory in gold and firmly in positive territory in silver. Gold finished the comex session at $1727.90 down $2.80 whereas silver finished up 36 cents to $32.67. The big news last night came from GATA who reported the CEO of Anglo Ashanti stated that investors are approaching mining companies for their metal bypassing the comex and banks. This would be a death knell to the bankers who count on mines for their metal. Let us head over to the comex and see how inventory moved coupled with delivery notices. Read More @ HarveyOrgan.Blogspot.com
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| Posted: 06 Dec 2011 11:49 AM PST from BigDad06: What will Jon Corzine say on Thursday about MF Global? Who knows and who cares but the link is here http://www.zerohedge.com/news/jon-corzine-tesify-thursday-over-mf-global-coll… . Ann Barnhardt's interview is here http://www.financialsense.com/financial-sense-newshour/guest-expert/2011/12/0… . Portugal citizens get MF'ed and the link is here http://www.zerohedge.com/news/portugal-latest-country-go-mf-global-raids-pens… . Here is Martin Armstrong's latest article http://www.martinarmstrong.org/files/Intervention%2011-30-2011.pdf . Nixon didn't take us off the gold standard in 1971, he just publicly announced what France already knew which was we didn't have the gold we said we had. Half-ass gold standards don't work for long and are not the same as true gold standards which the world has never had. Thanks for watching!
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| Posted: 06 Dec 2011 11:33 AM PST by Andrew Hoffman, MilesFranklin.com:
It's still Monday evening, and I have a lot to write for Tuesday's RANT, as information is besieging me from all angles. Like a young songwriter or novelist, I am in the prime of my creative career, and frankly have too many thoughts to articulate. Funny how it took this long to peak, as I have been writing professionally for nearly 15 years, oftentimes about topics I felt equally forceful about. However, NEVER have I been as inspired as this year, even more so now that I've joined Miles Franklin. As noted this weekend, the HUI mining index was smashed 20 points Friday while gold prices were UP, a CLASSIC Cartel "signal" that gold would be smashed the following day. Such signals are EXACTLY what Andrew McGuire has been telling the CFTC, and EXACTLY what the "GATA Army" has been highlighting for the past decade. I was 100% POSITIVE something nefarious would occur today, although how, how much, when, and under what pretense was not yet certain. Years back, I'd worry about gold being hit due to "good news" about the U.S. economy, although I KNEW any such news was at best misleading, and at worst deceitful. The fact that such "good news" was only considered as such following Cartel and PPT follow-up work was immaterial; what was important, however, was that the majority of people believed such propaganda, enabling the Cartel to make short work of PAPER PM prices at any time.
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| The Endgame: Japan Inc. Plays By Its Own Rules Posted: 06 Dec 2011 11:25 AM PST Wolf Richter www.testosteronepit.com The plunging approval ratings of Japanese Prime Minister Yoshihiko Noda continue the tradition of all Japanese prime ministers since Junichiro Koizumi—there were six of them in five years. Public approval is high at the start when voters hope that things will change. As reality sets in, approval skitters down a steep slope that lasts 8 to 15 months. When it drops into the low twenties, the prime minister is kicked out, and a new guy is installed. Days after being appointed on September 2, Noda reveled in a public approval rating of 63%. Early October, it plunged to 55%. Early November, it plunged to 47%. The November poll was taken after he'd announced legislation that would raise the national consumption tax from 5% to 10%. Government deficits have spiraled out of control. Gross national debt is 230% of GDP (it makes Greece's 160% look virtuous). Japanese Government Bonds, rated AA-, are facing further downgrades. Something needs to be done. And Noda asked consumers to do it. The latest poll, conducted in early December, wasn't kind either. The ongoing discussion about the consumption tax dragged down his approval ratings to 44.6%. Other issues weigh as well, such as frustration with the disaster reconstruction efforts, response to nuclear contamination issues, and an increasing public distrust in the political parties. The prime-ministerial unpopularity contest continues:
Noda's disapproval rating jumped by 6 points to 40.3%. More than half of those surveyed want a general election before the new consumption tax is enacted. Only 25.4% supported his plan to hold an election after enacting the legislation. Even voices within Noda's Democratic Party of Japan (DPJ), have expressed concern about the tax increase at a time when the economy is fragile. Ironically, to keep the economy afloat, the government just advanced another "supplemental budget" (stimulus package), the fourth this year, unprecedented since World War II. And the tax increase is under attack from the Liberal Democratic Party (LDP) which ruled Japan almost continuously from 1955 until 2009. After Japan's bubble burst in 1989, the government resorted to deficit spending to prop up the economy, which accomplished two things: sporadic upticks in GDP and an explosion in government debt. At 230% of GDP, and still growing, that debt can no longer be serviced by a workforce that is shrinking—a result of two demographic shifts: decades of low birth rates and the retirement of baby-boomers. And cracks have appeared in two other pillars that support the debt: the savings rate has sunk to American levels, and the trade surplus has been replaced by deficits at regular intervals (five months so far this year). So, is Japan at the brink of an epic collapse? Are JGB yields going to spike? Is it time, finally, after 20 years of false hope, to short JGBs? Funding hasn't been a problem: due to Japan's institutional setup and insular psychology, it has been able to sell 95% of its JGBs within Japan. Individuals directly or indirectly hold over 50%. Government-owned or controlled institutions hold over 40%. Among them: the Government Pension Investment Fund, one of the largest pension funds in the world; the government-owned Post Bank, the largest deposit holder in the world; financial institutions the government can lean on; and the Bank of Japan. There is essentially no free market for Japanese debt, and foreigners hold only 5%. Whenever the BoJ, the Ministry of Finance, and politicians say, "Buy these crappy bonds at these ridiculously low yields," buyers fall in line. Example: the planned sale of reconstruction bonds. Those who buy certain amounts and hold them for specified periods get a gold trinket as reward, rather than yield. And it'll work. It's easy to underestimate just how powerful Japan Inc. is, and how powerless elected officials are. Prime ministers are replaced when the public gets frustrated. But the bureaucrats and corporate interests that control a big portion of the economy remain in place. It's also easy to underestimate how cohesive and homogeneous Japanese society is, and how willing the people are to sacrifice for a common good, namely Japan, as long as Japan takes care of them in return. So far, that pact has worked. While Japan's debt will blow up eventually, it's not clear when, and it's not clear how. The Japanese might very well make a collective decision to deal with it in a manner that seems incomprehensible to the rest of the world. And anyone who bets against Japan Inc. and its debt should keep that in mind. But life goes on. 20 supercars were speeding down the Chugoku Expressway, trying to get to a supercar gathering in Hiroshima. At a left-hand bend, the lead Ferrari changed lanes at 90 to 100 mph though the speed limit was 50 mph. The highway was wet. And the rest was very expensive.... Superlative Supercar Pileup (with video). Wolf Richter www.testosteronepit.com
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| Has The Imploding European Shadow Banking System Forced The Bundesbank To Prepare For Plan B? Posted: 06 Dec 2011 10:25 AM PST While much has been said about the vagaries in the European repo market elsewhere, the truth is that the intraday variations of assorted daily metrics thereof indicate three simple things: a scarcity of quality assets that can be pledged at various monetary institutions in exchange for cash or synthetic cash equivalents, a resulting lock up in interbank liquidity, and above all, a gradual freeze of the shadow banking system. As we have been demonstrating on a daily basis, we have experienced all three over the past several months, as the liquidity situation in Europe has gotten worse, morphing to lock ups in both repo and money markets. As a reminder, both repo and money markets (for a full list see here), are among the swing variables in shadow banking. And shadow banking is nothing more than a way to expand credit money while undergoing the three traditional banking "transformations" - those of maturity, liquidity and credit risk, although unlike traditional liabilities, these occur in the "shadow" or unregulated area of finance, interlocked between various institutions, which is why the Fed has historically expressed so much caution when it comes to discussing the latent threats in it. Indicatively, of the $15.5 trillion in shadow US liabilities (by far the biggest such system in the world), $2.6 trillion are liabilities with money market mutual funds and just $1.2 trillion are repos. Indicatively, traditional plain vanilla bank liabilities amounted to $13.4 trillion as of Q2 (an updated for Q3 is imminent). As such, the focus on repo while useful, misses the forest for the trees, which is that not the repo market, but the entire shadow banking system in Europe is becoming unglued. What explains this? Two simple words, which form the foundation of modern finance - "risk" and "confidence", and in Europe both are virtually nil. Seen in this light, the unwind of the shadow system explains much: the inability of Germany to place bunds, the parking of cash with the ECB, the freezing of repo, the plunge in the currency basis swaps, the withdrawal of money markets, the blow out of various secured-unsecured lending indicators, etc. All of these fundamentally say the same thing: there is too much risk and not enough confidence, to rely on the abstraction that is shadow risk/maturity/and liquidity transformation. All this is easily comprehended. What is slightly more nuanced, is the activity of the ECB and especially the Bundesbank in the last few weeks, whereby as Perry Mehrling of Ineteconomics demonstrates, we may be experiencing the attempt by the last safe European central bank - Buba - to disintermediate itself from the slow motion trainwreck that is the European shadow banking (first) and then traditional banking collapse (second and last). Because as Lehman showed, it took the lock up of money markets - that stalwart of shadow liabilities - to push the system over the edge, and require a mult-trillion bailout from the true lender of last resort. The same thing is happening now in Europe. And the Bundesbank increasingly appears to want none of it. So just what is happening? Mehrling first explains the European funding status quo:
So far so good: this is the system that as noted above is slowly crumbling. So what is happening next? One read is the following:
One conclusion that is possible is that one proposed by Mehrling: "we're not going to be using the payment system to hide imbalances any more. The ECB is going to serve as a proper lender of last resort to the banking system, affirmatively and up front rather than mechanically and through the back door. But it will be doing so only to the banking system, not to sovereign debtors." It would be expected that some combination of EFSF/IMF funding would sourced the balance. In effect the ECB would intermediate itself directly in the national bank bailout scheme, allowing it to be more like the Fed, which has been the primary complaint against the ECB all along. There is also one other explanation: the Bundesbank wants out. As a reminder, while the Fed is the one central bank in the world which supposedly has the biggest amount of gold in possession with 8.1 thousand tonnes, Buba is #2 with 3,401 tonnes. In other words, it has a solid backing to its fiat asset representation. However, unlike the Fed, the Bundesbank is part of a nation that has a natural trade surplus and thus is cash flow positive from a current account perspective. One may say that Germany, far more than the US and the UK, is the world's truly AAA-rated nation. All this means that the Bundesbank, if disambiguated from the ECB, where it currently is accountable for funding a major portion of deficit nations' funding deficiency, would regain its status as the world highest quality monetary institution. And going back to the beginning, it is the Bundesbank which is effectively depleting "good money" in exchange for "bad" either in the form of undervalued collateral through the repo markets, or soon to be devalued fiat. Here one has to keep in mind the primary prerogative of the Buba - keep inflation low. If that means detaching from a failing currency, or halting asset-liability matching in which it hands out good money in exchange for worthless assets, so be it. Which is why another interpretation of the ECB's proposal is not to bring the ECB as a lender of only resort closer to the peripheral, deficit nations, but to commence proceedings for severing the umbilical cord of the Bundesbank with a Eurozone which is doomed in all but the most optimistic eyes. Bringing us to our question: for anyone wondering what the future of the Eurozone is, should they merely observe what steps the German central bank is stealthily starting to take. Because if indeed the Buba wants to have as little as possible with Europe, what does that mean for the EUR, and for Europe itself? Full video explanation below:
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| Timing China's Financial Meltdown and Housing Market Crash Posted: 06 Dec 2011 09:22 AM PST At an October seminar of the Chicago Council on Global Affairs (CCGA), carnival economist Niall Ferguson promoted his new book, Civilization: The West and the Rest. He revealed the blindingly obvious as if it were a divine revelation: the U.S. has serious problems. He preached that the U.S. corrupted its six Ferguson-defined "killer apps": competition, science, rule of law, medicine, the consumer society, and a strong work ethic.
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| Gold Price Near the Trendlines is a Good Time to Buy Posted: 06 Dec 2011 09:14 AM PST Gold Price Close Today : 1727.90 Change : (2.80) or -0.2% Silver Price Close Today : 3267.2 Change : 36.6 cents or 1.1% Gold Silver Ratio Today : 52.886 Change : -0.686 or -1.3% Silver Gold Ratio Today : 0.01891 Change : 0.000242 or 1.3% Platinum Price Close Today : 1519.70 Change : -1.00 or -0.1% Palladium Price Close Today : 668.25 Change : 36.40 or 5.8% S&P 500 : 1,258.47 Change : 1.39 or 0.1% Dow In GOLD$ : $145.36 Change : $ 0.87 or 0.6% Dow in GOLD oz : 7.032 Change : 0.042 or 0.6% Dow in SILVER oz : 371.88 Change : -2.59 or -0.7% Dow Industrial : 12,150.13 Change : 52.30 or 0.4% US Dollar Index : 78.62 Change : 0.049 or 0.1% I have to sort of break the rules today for the GOLD PRICE. I say "sort of" because nowadays the gold market runs 24 hours, so closes aren't quite as dispositive as once they were. Here's what I mean: Yesterdays GOLD PRICE closed at $1,730.70 on Comex, and today at $1,727.90, ostensibly "down" $2.80. But when you looked at what happened in the market AFTER Comex closed, instead of merely posting two down days, gold actually traced out something like a key reversal to the upside. Here's where I'm stretching the rules. A key reversal occurs when a market trades into new low territory, then closes higher at day's end. Second half confirms when it closes HIGHER the next day. Yesterday after Comex closed the Globex market traded down to $1,717. Then overnight the GOLD PRICE kept on dropping, and posted a low at $1,702.47 (neatly defending, by the way, the $1,700/$1,705 support). That low came while New York was open, about 10:00, and the rest of the day gold climbed like a Sherpa. By my math, $1,727.90 is higher than $1,702.47, and after gold had come under that attack, and been driven down so far, to come back nearly to unchanged -- viewing the whole 24 hours together -- looks like a market turning up. It also left behind an upside-down head-and- shoulders-ey chart, with a $1,720 neckline. The GOLD PRICE stopped today at $1,730 -- actually, is trading a bit above that now at $1,730.45. Tomorrow gold must not trade below $1,725 and must climb and close above $1,730 or 'twill explode my rule-stretching theory. Add to my upside suspicions silver's behavior today. It rose 36.6c to close Comex at 3267.2c. Mmmm -- silver rose 1.1% while gold dropped minutely. I have to call that a BULLISH divergence. The SILVER PRICE chart last two days looks like a reversal, too, provided tomorrow it clears 3300c, or at worst doesn't close below 3250c. For the nonce and until gainsaid, I interpret the last few days' moves in silver and gold to be "reactions back to support", that support being the rising boundary of an even-sided triangle. Closes below those lows mentioned above would cancel that interpretation. Be advised that coming shortly is some break out of those even-sided triangles, up or down. For now, though, these prices near the trendlines offer good places to buy. Should they drop more, I will buy more. Just as people used to ask me in the years running up to the real estate peak in 2006, "Do you really mean that I should sell my house?" so today they ask me, "Do you REALLY mean that I should cash in my IRA?" Answer in both cases is, "Yes. Yes." My fear is that if you don't, the federal government will one day decree that your IRA can only invest in US government bonds. Where will you be then? Anyway, one owneth not what one controlleth not, and thou controllest not thine IRA, the government doth. If that's not true, then why do you have to pay a penalty and tax to take possession of it? In my little natural born fool's mind, anything I don't control doesn't really belong to me yet. Quaint, I know, but realistic. Hidebound Tennessee. For all the hu-hu yesterday about the Great Fix in Europe, the euro did well to keep its lips above water today. Ended at 1.3409, up a bit, 0.7% -- enough to see, I reckon, if you have a microscope handy. Yen rose also to 128.73c per Y100 (Y77.68/$1). US DOLLAR INDEX stubbornly refuses to to bow to Euro-exuberance by sinking below 78.50. Today trading at 78.619, up 4.9 basis points, a tiny 0.06%. Since Friday the trend has been up, with higher lows and higher highs. Must-hold line is the uptrend line at 78.45. Long as the scrofulous dollar holds that line, it points up. Dow Jones Industrial Average today rose an uncertain 52.3 points (0.43%) to 12,150.13. S&P500 rose 1.39 (0.11%, even more uncertain), to 1,258.47. Okay, ask me why I think 12,200 puts the cap on any stock market rally? Glad you asked! Because going back to November 2010 you can draw a line from the 11/10 top across the bottoms in 2011 and you will see a massive, undeniable head and shoulders top. That HandS is confirmed by a gigantical drop in August once it closed through the neckline, from 11,900 to 10,604. All the moiling since then has done no more than take the Dow back up to that neckline for a Final Kiss Good- Bye before it falls to perdition. O, the weeping and wailing and woe! It draws ever nearer. 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 bubble has burst, primary trend down. WARNING AND DISCLAIMER. 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 short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures. NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps. NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced. NOR do I recommend buying gold and silver on margin or with debt. What DO I recommend? Physical gold and silver coins and bars in your own hands. One final warning: NEVER insert a 747 Jumbo Jet up your nose. 
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| Sprott Frustrated With Hostage-Taking Paper Silver Market Posted: 06 Dec 2011 09:03 AM PST Silver producers are being held hostage to the paper silver market, says, Eric Sprott, Sprott Asset Management CEO. Speaking to Mineweb the week after posting a letter on King World News calling on silver producers to act to ensure that the physical market, rather than the paper one, determine the price of the metal, Sprott said that he wished producers of the metal would " finally realise what the paper boys did to them in 2008 – they nearly bankrupted them all and yet they haven't got involved in these lawsuits which I find troubling." Asked whether or not he has received any feedback from the producers on his suggestion that they "reinvest 25% of their 2011 earnings back into physical silver," Sprott said that there had been a groundswell of interest – more than he had ever seen before – but that still more needs to be done. Sprott says that the idea stems from two factors currently at play within the silver market: the first is the general weakness seen within the global banking system, the second is the level of volatility in the system. "For example, when silver hits $49.50 between the various paper markets, there was something like one billion ounces of paper silver sold that day – and purchased of course. But, we only produce about 900 million ounces a year… what do you think of the guys who were selling a billion ounces of silver who didn't have a hope in hell of providing it?" By investing in the physical market, Sprott believes, producers would be able to show that there is indeed an imbalance in the physical silver market. "It's a pretty fine line right now whether they can meet all the demand on a day-to-day basis, if by putting 25% of their cash into silver – it might have the effect of decreasing the supply by around 10 percentage points… I believe 10 percentage points would be enough to make a difference." He adds, "I'm very frustrated by what's going on in the paper silver market. I just find it unbelievable that you can have silver go down $6 in 13 minutes one time when the markets weren't really open and then you get four margin rate increases the next week – four… It smells like a set up to me." SILVER PROSPECTS This frustration is made all the more acute for Sprott because of the strong underlying story he sees playing out in the physical market. Currently, he says, there is nothing in the macroeconomic environment that would lead him to think that people don't want to own physical silver. Over the long term Sprott believes that he market has made gold the reserve currency. "I don't care whether the central banks have or governments have, but the markets made it the reserve currency… central banks have been aiding and abetting that process – they're almost making it the reserve currency by their actions, not by their statements and when it was a reserve currency silver traded at a ratio of 15 to 16:1 of the price of gold." Over the shorter term, he says there is clear evidence of strong demand for the metal, "demand for silver is versus the demand for gold in the investment arena and when I see people like Gold Money sell as many dollars of silver, as gold. When I see the US Mint sell as many dollars of silver as gold which by the way implies in both instances, 50 times more physical than gold. And when we did the IPO for Gold Trust we made $440 million. When we did the IPO for the Silver Trust we made $550 million…Well how can the price be 50:1 when the money is going in 1:1?" Source: Mineweb
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| Gold Price to ‘Double’ in 2012, says Guru Posted: 06 Dec 2011 08:56 AM PST Get the checkbooks out, because the flight into gold is about to commence, says economist and NY Times best selling author Dr. Stephen Leeb. But a liquidity crisis sell off in goldmay provide that opportunity, first. The dramatic move by six central banks on Wednesday to lower dollar swaps rates flashed a big red light to markets that liquidity, which has been drying up between banks in Europe, had become acute and created the risked of another 2008 Lehman-like meltdown event, taking the U.S. banks along with Europe's down the path to Armageddon. "There are liquidity concerns right now. I think the world, and in particular Europe, really does have a liquidity problem," Leeb told King World news on Monday. "If Europe has a liquidity problem that obviously has the potential to affect everybody, especially the U.S."
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| Despite Bazooka Rumor, Equities End Unch As Commodities Surge Posted: 06 Dec 2011 08:46 AM PST Equity and credit markets traded in a narrow range for much of the day - especially post the European close - only to swing violently up and down in the last hour on the back of FT rumors or a bigger bailout. Volume was notably lower than average though as ES sold off hard into the close, and picked up significantly higher as we crossed VWAP, with the market closing well below that balance point. Broad risk assets were generally a little more positive this afternoon as the commodity sector saw decent outperformance all day (most notably Silver and Gold) but it was TSYs post-Europe sell-off (and EUR strength) that continues to ring the bell of repatriation flows. Today felt a lot like ES (the e-mini S&P 500 futures contract) was the tail of the CONTEXT dog with these 'TSY-EUR' flows having a significant impact. Credit indices in general tracked ES, though lagged its late day rally and sell-off, ending the day modestly outperforming equities (though this was likely a liquidity issue more than anything else). HYG once again outperformed supporting HY bond net buying as IG saw decent new issue volumes on the day. While broad assets are modestly supportive or risk appetite as we close, the divergence between VIX and Implied Correlation (which closed at two-week highs) raises an orange (maybe red) flag once again.
Silver was very excited today, managing a 3.5% intraday swing from low to high (near the highs of the week). Copper managed a solid day and we note that Oil and Copper are converging again on the USD shift this week. Gold is the under-performer on the week so far (down around 1%) but managed a positive day today. These commodity moves (most specifically Gold and Oil) helped provide some support for CONTEXT which remained biased positive relative to ES most of the day.
The FT rumor caused ES to rally up and converge perfectly with CONTEXT (the broad risk asset basket-based indicator of equity value - dark blue), but equities gave it all back and then some, to close very fractionally lower on the day at the end of the futures session (with the drop continuing post the cash close). ES oscillated in a tight range around VWAP (light blue) for most of the day but as is evident the 1% rally (almost 3 standard deviations away from VWAP) in the last hour, quickly reverted with ES perfectly balanced at VWAP at the cash close and finding some volume pickup in sellers as the futures traded on for 15 more minutes. CONTEXT (dark blue line in chart above) remains a little more bid - helped by TSY levels and curve shape shifts - as we note 30Y TSY closed near its high yield of the day, not retracing as aggressively as stocks.
The curve notably steepened, and 2s10s30s (another CONTEXT driver) rallied strongly - both supporting the fact that broad risk assets are positively biased relative to stocks here at the close. A similar picture is evident in credit markets.
IG and HY initially lagged the ramp up in ES, but given how quiet it was, they were reracked tighter only to stay near their tights and not retrace wider as stocks old off into the close. HYG (the high yield bond ETF) managed another miracle outperformance day, remains expensive to NAV and HY spreads.
One of our more accurate signals popped up this afternoon. The bearish divergence of equity index implied correlation (green) relative to VIX (red - futures) suggests that while vol was compressing at the index level, it was bid relative to the underlying names as implied correlation closed above 80 for the first time in 2 weeks. This means market makers were more than willing to soak up this 'crash risk' as we head into the EU summit. All-in-all, broad risk markets suggest ES overshot to the downside after the close and will revert modestly higher this evening. The TSY-to-EUR repatriation-flow argument seems to be increasingly driving ES whiplash and we would expect only a decent flattening and compression will draw CONTEXT lower and support a more negative bias to stocks here. The implied correlation divergence is generally a worrying sign for risk appetite suggesting pros starting to hedge macro risk into the EU summit. Charts: Bloomberg and Capital Context
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| Posted: 06 Dec 2011 08:40 AM PST Bill Bonner View the original article. December 06, 2011 11:10 AM Not much to report from yesterday. Dow up 78 points. Gold bouncing around. All eyes are on Europe. If the Europeans can pull off a save…well, we're all saved. At least for a few weeks. Maybe through the holiday season. The euro has been remarkably stable. It has never collapsed — despite all the talk of Europe falling apart. Apparently, people with money don't think it is in real danger. They think it is too important to let go. They may be right. And the more people talk about the 'end of Europe' the more it doesn't end. Instead of letting it go, the authorities become more and more stubborn in trying to hold it together. It's hard to know how this will play out. But we feel we know how this week will go. Frau Merkel and Monsieur Sarkozy will put together a new plan… It will include promises of fiscal tightness along with monetary looseness. The EZ money is expected to put short-term investors' fears ...
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| Gold Breaking Mutliple Support Lines Posted: 06 Dec 2011 08:40 AM PST courtesy of DailyFX.com December 06, 2011 08:38 AM 300 Minute Bars Prepared by Jamie Saettele, CMT The 3 wave rally from the September low is viewed as a correction of the decline from the record high and should be completely retraced. Gold briefly traded under channel support and the former 1681 pivot low from late October before rebounding. A look at the long term picture reveals that gold remains above long term trendlines but some of those lines are well below the current level. Even a test of the trendline that has defined price since the summer 2010 lows would result in a test of the mid 1500s (52 week average in the vicinity). A drop similar in amplitude to the one that occurred in September would reach the low 1400s. If gold has entered a larger bear market, then price needs to stay below the September-November trendline. Confidence in the downside is increased as gold has broken multiple trendline supports. 1720 is now resistance. Other TA Articles...
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| Posted: 06 Dec 2011 08:31 AM PST My Dear Extended Family, Gold surprised the growing army of bears today. Soon it is going to resolve this symmetrical formation (the angles are beautiful) and when it does it is going to be wild. I buy the dips because I am certain that $2000 is coming into view. Regardless, hold your Gold insurance Continue reading $2000 Is Coming Into View
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| Interview with Ranting Andy Hoffman 12-6-11 Posted: 06 Dec 2011 08:16 AM PST The United States has run up a cumulative $7.5 trillion Trade Deficit. The last time the country ran a trade surplus was in 1976. Nixon closed the Gold Window in 1971. Do you believe it's just a coincidence that the rise of an un-backed Fiat Dollar and the rise of the Trade Deficit haapened so close in time? The Country has been in a pronounced economic decline since the 1970's and when the Gold Window was closed. Since then the money supply has increased many times as has inflation. While living standards have declined, so has domestic energy production. This has exacerbated the Trade Deficit and has cost consumers countless billions. The ability to print up currency and dump it on a willing world, in exchange for their production, has enabled the Government to present the illusion that things are alright. But look at the dying industrial cities in America. Detroit, once a paragon of industrial success, has fallen upon hard times. The average Detroit home is going for $6,000, only 25 percent of students graduate from high school and unemployment among men has reached nearly half of the work force. Such trade imbalances were much less likely to occur under a Gold Standard. Countries were not likely to allow complete depletion of their gold reserves. Fiat currencies can keep being produced regardless how bad the imbalance becomes. Then it is up to the trading partners to decide whether or not to accept the currency. At some point enough will be enough and it will be game over. Please send your questions to kl@kerrylutz.com or call us at 347-460-LUTZ.
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| Gold Daily and Silver Weekly Charts - Another Bear Raid Down to Support That Fails Posted: 06 Dec 2011 08:13 AM PST |
| Note to Greeks: whatever’s not in gold and silver, you’ll lose Posted: 06 Dec 2011 07:57 AM PST Anxious Greeks Emptying Their Bank Accounts
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