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- Dollar General: A Case Study
- The Bottom May Be In On Minefinders: Time To Buy
- Many Boom-Era LBOs Are Struggling
- Book Review: 'Gents With No Sense' A Laughable Look At Wall Street
- Apixaban- Pfizer's Multi-Billion Dollar Income Replacement For Lipitor
- Top Consumer Stock Picks By Tiger Cub Patrick McCormack
- Vulture Bargain Update for December 2011 – January 2012 Posted
- Special Year End Silver Deal
- Gold is the Rock of Stability
- Art Cashin on Obama
- How an Economy Collapses: Part One
- WATCH: Johann Saiger Talks Gold with Turk
- Johann Saiger talks to James Turk about gold
- Euro Fudge Distracts From Global Debt Titanic; Intervention in Gold Market?
- Buy Silver…Now!
- Silver: Investment Demand Is Just Part of the Picture
- Gold price benefits from negative real interest rates
- Gold is the rock of stability in the middle of the euro storm
- LISTEN: Jim Sinclair talks with Ellis Martin
- WARNING: The MF Global "contagion" is quietly spreading
- Risk OFF: The dollar could be on the verge of another big move
- Year End Review – 2012 Outlook
- Morning Outlook from the Trade Desk - 12/09/11
- Ben Davies: “Your Country Needs Your Money”
- Charts on America's Wealth
- WATCH: William Black on Jon Corzine
- BIS, Bank of England, Fed Reported to Have Sold Gold on Thursday
- South Africa mining production falls 12.7%
- February Gold’s ‘Technicals’ Are Firming
| Posted: 09 Dec 2011 06:12 AM PST By Jerry R. Carter: Financial Analysis A brief overview of Dollar General's (DG) current corporate governance will show one main difference from its competition. The company was acquired by a private equity buyout completed by Buck Holdings, L.P. during July of 2007. Buck Holdings is a Limited Partnership controlled by Kohlberg Kravis Roberts & Co., better known to the investment world simply as KKR. The company was brought public with the help of Goldman Sachs & Company (GS) during an initial public offering (IPO) of 39.2 million shares at a per share price of $21. As a result of the private equity transaction Buck Holdings, KKR and Goldman indirectly own 85% of Dollar General shares. This allows the three companies to control the board of directors at Dollar General, which relieves them of certain corporate governance requirements, and have complete discretion of board members (Standard & Poor's 2010). Reuters and Standard & Poor's research Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| The Bottom May Be In On Minefinders: Time To Buy Posted: 09 Dec 2011 05:41 AM PST By Simit Patel: Minefinders (MFN) is a gold and silver producing mining stock that I purchased last week. Here's my rationale: 1. The company is currently producing gold and silver and generating revenue from sales. In the first 9 months of 2011, the firm produced over 53,600 ounces of gold and over 2.65 million ounces of silver. The fact that it is a producing mining firm makes it on to my short watch list. 2. The firm also managed to reduce its gold equivalent cost per ounce to $506; 2010 costs were $743 per ounce, thus marking a considerable improvement. 3. The company has additional projects in the works, and a balance sheet that suggests sufficient health to see those projects actualized. Financials released at the end of Q3 2011 show the company has $228 million in cash and short-term investments; its net worth (assets minus liabilities) is $331 million. The firm currently Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Many Boom-Era LBOs Are Struggling Posted: 09 Dec 2011 04:59 AM PST By Streetwise Blog: By Tim Kildaze The majority of U.S. companies scooped up in boom-era leveraged buyouts continue to struggle as much as five years after they first closed, according to a new study by Moody's Investors Service. To make this claim, the rating agency took a look back at the 40 largest LBOs from 2006 to early 2008, including Warburg Pincus's purchase of Bausch & Lomb and KKR's acquisition of Dollar General Corp. (DG). Of the 40 companies studied, 15 are rated lower than they were at closing, three have filed for bankruptcy, and 16 are rated at the same level. Only five have seen their ratings upgraded. Moody's attributes the poor performance to weak revenue growth and high default rates Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Book Review: 'Gents With No Sense' A Laughable Look At Wall Street Posted: 09 Dec 2011 04:56 AM PST By Daryl Montgomery: While it's easy to find laughable news coming out of Wall Street, little of it is intentionally amusing. Ron DeLegge has decided to remedy this situation in his book, "Gents With No Cents." "Gents with No Cents" is a fun-filled romp through the back alleys, sub-basements and greasy trading pits of Wall Street and its equivalents everywhere. Where there's money to be made, virtue gets thrown out the window long before anyone decides to jump. It's not the first time this has happened in history and it will end the same way it always does with a general collapse (the first phase was already seen during the Credit Crisis in 2008 and the current EU debt crisis is the second phase) followed by a wave of reform. This process will then begin all over again. You can either choose to laugh or cry during the unraveling. The book doesn't just Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Apixaban- Pfizer's Multi-Billion Dollar Income Replacement For Lipitor Posted: 09 Dec 2011 04:48 AM PST By John Mylant: Pfizer (PFE) has been a large solid pharma company for a long time and investors are contemplating the loss of income from Lipitor and how it will affect future income. What is coming down the pipe line that could help replace this lost income? For those of you who do not know much about Pfizer: Pfizer Inc., a biopharmaceutical company, offers prescription medicines for humans and animals worldwide. The company's Biopharmaceutical segment's provides Lipitor for elevated LDL-cholesterol levels in the blood; ffexor XR for depressive, generalized anxiety, social anxiety, and panic disorders; Premarin for menopausal symptoms; and much more. You might have read it in other articles or head it on the news. In 2010 Lipitor, the cholesterol drug that is losing its patent made Pfizer $10.7 billion dollars in revenue. That is coming to an end and will take a tough toll PFE's income. When other large pharma companies Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Top Consumer Stock Picks By Tiger Cub Patrick McCormack Posted: 09 Dec 2011 04:44 AM PST By Insider Monkey: Patrick McCormack is one of the Tiger Cubs. His Tiger Consumer Management is one of the several funds that were seeded by Julian Robertson, the hedge fund legend. As its name implies, Tiger Consumer mainly invests in the consumer sector. Founded in 2006, the New York based Tiger Consumer Management currently has approximately $1.3 billion worth of stocks in its 13F portfolio. Below is a list of top 20 positions in Tiger Consumer's 13F portfolio as of September 30, 2011.
Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Vulture Bargain Update for December 2011 – January 2012 Posted Posted: 09 Dec 2011 04:05 AM PST
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| Posted: 09 Dec 2011 03:53 AM PST Rock bottom pricing available only to our Austin Report readers! | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Posted: 09 Dec 2011 03:04 AM PST Gold is the Rock of Stability in the Middle of the Euro Storm from GoldMoney.com:
That does not mean that nothing was done, interest rates were lowered to 1%, historical lows for the common currency, which leaves the most important currencies in the world all in negative real rate territory as this interactive chart shows. Markets expressed their disappointment with zest: EURUSD, major European indices and Brent crude plunged, risk spreads and euro debt yields rose. Even gold fell from above $1,750 per troy ounce at the beginning of Draghi's speech to a close just above $1,710, although the gold price in euros remained near its €1,300 per ounce peak. Read More @ GoldMoney.com | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Posted: 09 Dec 2011 02:59 AM PST Art Cashin Explains Why Obama Is "Terrified" By A European Collapse from ZeroHedge:
Confused why Tim Geithner has seemingly booked a weekly round trip ticket to Brussels to give the Eurocrats their weekly pep talk (much to his endless humiliation as Europe Tells Geithner To Take His Advice And Shove It reminds us)? Art Cashin explains not only this, but why the biggest threat to Obama's reelection chances is not who the GOP candidate is in November, but what happens in the EURUSD as early as today. Lastly, by implication, Cashin shoots down any hope that US decoupling from Europe is even remotely possible… something anyone who actually has seen a full business cycle, which automatically excludes 90% of all traders today, will know too well. Read More @ ZeroHedge.com | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| How an Economy Collapses: Part One Posted: 09 Dec 2011 02:57 AM PST How an Economy Collapses… and How to Protect Yourself (Part 1 of 2) by Paul Mladjenovic, GoldSeek.com:
Keep in mind first that we are talking about an "economic" collapse… don't confuse this with a "currency" collapse. History has witnessed thousands of currencies collapsing into oblivion and in many of those the economy in question was able to get through it without general harm to the economic infrastucture and much of society. Yes…currency collapses are very painful but they don't necessarily spell doom for society. My former country, Yugoslavia, experienced both a currency collapse and also an economic collapse. It was, after all, a communist country (hard-core socialism) and so it was already an "economic basket case". The populace was already suffering before its currency was hyper-inflated into oblivion. During 1993-94, Yugoslavia's hyperinflation caused the dinar (its currency at the time) to become worthless and the currency indeed collapsed. As I have written before, "Economic disintegration leads to social disintegration". Soon the currency collapse led to economic collapse. Chaos and civil war followed. Read More @ GoldSeek.com | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| WATCH: Johann Saiger Talks Gold with Turk Posted: 09 Dec 2011 02:53 AM PST Johann Saiger Talks to James Turk About Gold They talk about the price of gold. James Turk explains how gold woke him up in the 1960s to the fallacies of his economic education. They talk about the history of gold, since the gold coins first minted by King Croesus of Lydia and how that compares to fiat currencies. Johann Saiger explains that the debt burden in Europe has grown past the point of no return: it is mathematically impossible to pay it back. They talk about inflation and how it has grown steadily, and how they expect it to increase even more as money printing intensifies. This interview was recorded on November 4th 2011 in Munich. ~TVR | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Johann Saiger talks to James Turk about gold Posted: 09 Dec 2011 02:45 AM PST Johann Saiger, Editor of Midas Investment Report, and James Turk, Director of the GoldMoney Foundation, meet in Munich and talk about the price of gold. Johann Saiger explains that he has been very ... This posting includes an audio/video/photo media file: Download Now | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Euro Fudge Distracts From Global Debt Titanic; Intervention in Gold Market? Posted: 09 Dec 2011 02:34 AM PST | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Posted: 09 Dec 2011 02:11 AM PST Silver is an amazing metal…which is why it's likely to soar over the coming years… You see, silver has more than 10,000 uses. It's one of the world's best conductors of heat and electricity. Inventors filed more patents on silver uses than any other precious metal in the world. And when silver is used for most industrial and technological purposes, it is used up forever… It simply costs too much to try to recycle the tiny bit of silver from every cell phone or casino chip. | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Silver: Investment Demand Is Just Part of the Picture Posted: 09 Dec 2011 02:07 AM PST Institutional investors are coming! | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Gold price benefits from negative real interest rates Posted: 09 Dec 2011 01:15 AM PST According to a survey by Bloomberg, many gold dealers believe that the gold price will rally in the following weeks. In the face of the Brussels meeting, aimed at finding a solution to the euro ... | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Gold is the rock of stability in the middle of the euro storm Posted: 09 Dec 2011 01:00 AM PST We witnessed a somewhat disappointing performance from the ECB's Mario Draghi yesterday, at least for those that were expecting the "big bazooka", and many in financial markets were. ... | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| LISTEN: Jim Sinclair talks with Ellis Martin Posted: 09 Dec 2011 12:53 AM PST Join Ellis Martin for a candid and exclusive interview with America's preeminent expert on precious metals , commodities and foreign currencies. Jim Sinclair. Mr. Sinclair is the president of sponsor Tanzanian Royalty Exploration Corporation, trading on the AMEX division of the NYSE under the symbol TRX. Tanzanian Royalty focuses primarily on gold assets strategically located in the Lake Victoria Greenstone Belt of Tanzania, one of the most prolific gold producing regions in the world. The company acquired a 55% interest in the advanced-stage Buckreef Gold Mine Development Project which could see commercial production in 2014. We'll talk about that project and more today. Previously to helming Tanzanian Royalty, Mr. Sinclair was the founder of the Sinclair Group of Companies which offered brokerage services in stocks, bonds etc., operating in New York, Chicago, Kansas City, Toronto, London and Geneva. He was an advisor to Hunt Oil and the Hunt family from 1981-1984 for the liquidation of their silver position as a pre-requisite for the $1 billion dollar loan arranged by former Fed Chairman, Paul Volker. Mr. Sinclair was a general partner and member of the executive committee of two NYSE firms and the President of a commodities clearing firm as well as Global Arbitrage, a derivative dealer in metals and currencies and he now is featured weekly guest on The Ellis Martin Report. In this interview Mr. Sinclair speaks to the issue of financial woes in the European Union affecting the volatility of the gold market. He also offers stark advice for those seeking to protect themselves from a government and a fed gone wild. Additionally, Mr. Sinclair addresses a proven formula for building political stability in a developing country while doing business there, more or less assuring success of a resource project. | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| WARNING: The MF Global "contagion" is quietly spreading Posted: 09 Dec 2011 12:39 AM PST From Peter L. Brandt: The part of the MF Global heist that has surprised me the most is not that it happened or that the U.S. government was driving the get-away car, but that the traditional U.S. stock, mutual fund, and fixed income companies and traders have taken it with almost a yawn. I have been flabbergasted that the withdrawal window at a major U.S. bank has had a "closed sign" posted for almost two months with hardly a whimper, except from commodity futures traders. This "1929" style bank closing has occurred because segregated account holders have been denied their deposits. It has amazed me that the U.S. government has been blind (what's new) to the fact that Jon Corzine and his band of crooks have forcibly made segregated banking account holders counterparties to leveraged bets on Italian and Greek debt without their approval or knowledge. In the meanwhile, Congress continues insider trading with greed and no regrets while the White House readily accepts campaign contributions from bed mates on Wall Street and the "green" industry. Well, stock, fund, and bond friends, let your yawn be over – because the contagion is knocking at your door. I have written often in recent weeks that the breakdown in the safety of customer funds in one federally regulated category (futures) was the leak in the dike — and would eventually spread to stocks, mutual funds, banks, pension funds, annuity products, etc. Following are two wake-up calls... Read full article... More Cruxallaneous: Top manager Grantham issues his scariest market forecast yet The U.S. Senate is set to vote on one of the most frightening bills in history this week Must-read: "The entire system has been utterly destroyed by the MF Global collapse" | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Risk OFF: The dollar could be on the verge of another big move Posted: 09 Dec 2011 12:33 AM PST From Kimble Charting Solutions: Last week, the "Power of the Pattern" was reflecting the dollar could be forming a bullish "Cup and Handle" pattern, with the handle yet to be completed... Below is an update to the pattern a week later, reflecting that the dollar is attempting to break to the upside of handle resistance this morning... Read full aritcle (with chart)... More on the U.S. dollar: Ron Paul explains his plan to save the U.S. dollar The U.S. dollar is approaching another super-important level This chart could determine where stocks and commodities go for the rest of the year | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Year End Review – 2012 Outlook Posted: 09 Dec 2011 12:17 AM PST Analysts and forecasters are saying that 2012 will be the year that gold breaks $2,000 per ounce and that silver will push $70! | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Morning Outlook from the Trade Desk - 12/09/11 Posted: 09 Dec 2011 12:14 AM PST ECB suggests issues yesterday, equities get hit and metals fall through a trap door. This morning the picture looks a little brighter and equities firm and the metals lift. Being long yesterday morning slaps you, being short overnight hits you with the left hook. Keep Twiggy on your mind and comfort you will find. Starting to scare myself. Today's the day for a resolution, or not. | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Ben Davies: “Your Country Needs Your Money” Posted: 08 Dec 2011 11:18 PM PST from King World News:
In this piece, exclusively for the King World News blog, Ben Davies, CEO of Hinde Capital, gives KWN readers his take on what the central planners are up to and much more. In Davies' brand new interview he also discusses how this will impact gold and silver prices and many other key factors influencing the markets. "Financial War Bonds" Continue reading @ KingWorldNews.com | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Posted: 08 Dec 2011 11:15 PM PST Shocking Charts And Statistics That Prove That America Is No Longer A Wealthy Nation from The Economic Collapse Blog:
Read More @ TheEconomicCollapseBlog.com | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| WATCH: William Black on Jon Corzine Posted: 08 Dec 2011 11:08 PM PST Capital Account: William K. Black on MF Global and Jon Corzine Culpability (12/08/11) From Goldman Sachs to governor to grilling, Jon Corzine former CEO of the now bankrupt MF Global testifies on Capitol Hill. He claims he is clueless about how and where the possible $1.2 billion dollars of his client's money is that is missing. How has all of this happened three years after the financial crisis when Wall Street was supposed to be reined in? And the golden boys of Wall Street have their Goldman tentacles spread over the MF Global case. The head of the CFTC – MF Global's regulator – has recused himself from the MF Global probe because he worked with Jon Corzine at Goldman Sachs. We speak to William K. Black, a former regulator who during the Savings and Loan crisis oversaw more than 10,000 criminal referrals, 1,000 felony convictions, and where hundreds of bankers went to prison. Also, is the government's lackluster approach to transparency exclusive to wall street, or does it reach as far as Area 51? Thousands of people who believe in UFOs and think the U.S. government knows more than it admits were hoping for a breakthrough last month when they signed petitions on the "We the People" website. But they got what they've been getting for decades — nothing. And although these aliens may not have been looking for gold like the one's we covered in one of our last episodes, citizens of Taiwan may find some gold while looking for something less glamorous…dog poop. We explain how an innovative scheme to keep the streets of northern Taiwan clean has seen thousands of citizens dutifully collecting bags of dog poop in the hope of winning $2000 in gold. | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| BIS, Bank of England, Fed Reported to Have Sold Gold on Thursday Posted: 08 Dec 2011 09:05 PM PST ¤ Yesterday in Gold and SilverGold traded quietly during Far East trading on Thursday...and then did the same during the early London session. But once the Comex opened, the price was up fifteen bucks in no time at all, before getting creamed...and in about forty-five minutes gold went from its high of the day [$1,757.80 spot] down to $1,710...a $48 dollar hit. Needless to say, this was not the free market in action. From there, the gold price continued to slide a little...and closed the day at $1,705.80 spot, almost on its low...down $37.30 on the day. Volume was a very chunky 185,000 contracts.
Here's the New York Gold Spot [Bid] price on its own...and it's a different looking animal than the 24-hour Kitco chart posted above. You will note that 90% of the damage was done before the equity market opened in New York...and I'm sure that wasn't accidental.
The silver graph looks very similar to the gold graph, except the price was more 'volatile'. Silver was quiet all night long, but began to develop a positive bias shortly after 11 a.m. in London trading...and then went vertical at 8:30 a.m. in New York ninety minutes later. The rest, as they say, is history. Silver's high tick was $33.35 spot...and it's low print was $31.28...a 6% price swing in only a few hours. Ted Butler says that these huge price swings occur due to the lack of real liquidity in the market, as it's mostly this high-frequency trading stuff. Silver closed at $31.66 spot...down 85 cents on the day. Volume was very decent at 54,000 contracts.
Here's the New York Spot Silver [Bid] graph from yesterday. It shows more detail than the 24-hour chart...and this chart shows the big morning plunge more accurately.
For once, the dollar chart reflected the action in the gold market...although I'm not sure if it was a voluntary reaction. The slight positive price action in both metals between 7:00 a.m. and around 8:40 a.m. Eastern time is reflected in this graph. Then came the big rally in the dollar, accompanied by the crucifixion in the precious metals. The dollar low [78.15] came around 8:40 a.m...with the top of the rally [about 79.04] coming about 11:10 a.m. Eastern time. This was about a ninety basis point move, or about 1.4 percent. From that high, the dollar slid about 20 basis points into the close.
The moves in gold, silver and platinum in that brief time span were out of all proportion to the dollar move. Palladium and copper hardly budged. It should be apparent that this was a co-ordinated and targeted assault on just these three precious metals. The gold stocks gapped down and stayed down...and the HUI finished down 3.02% on the day.
But despite the fact that the silver price got smoked pretty good, the shares certainly didn't reflect that...and Nick Laird's Silver Sentiment Index only closed down 1.77%.
(Click on image to enlarge) The CME's Daily Delivery Report showed that 276 gold and zero silver contracts were posted for delivery on Monday. The big shorts/issuers were Goldman Sachs and JPMorgan...and the big long/stopper was the Bank of Nova Scotia. About 95% of all the delivery volume was trading done in their respective in-house accounts. There were very few deliveries in their client accounts. The Issuers and Stoppers Report is certainly worth a look...and the link is here. Their were no reported changes in GLD yesterday...but, despite the big price drop in silver, the SLV took in 1,361,649 troy ounces of silver. The U.S. Mint had its third sales report in a row. They sold another 2,000 ounces of gold eagles...500 one-ounce 24K gold buffaloes...and another 100,000 silver eagles. Month-to-date the mint has sold 16,000 ounce of gold eagles...8,000 one-ounce 24K gold buffaloes...and 906,000 silver eagles...and the month is still very young. There was a lot of silver activity over at the Comex-approved depositories on Wednesday. They took in 1,828,696 ounces...and shipped 414,234 troy ounces out the door. The link to that action is here. Here's a chart that Washington state reader S.A. sent my way yesterday. It's a 38-year chart of the gold price. Despite our current situation, it sure looks like parabolic to me.
Here's another graph. I lifted this one from a story that I posted in this column yesterday. It shows just how much debt has to be rolled over by only three European countries...Spain, Italy and France.
(Click on image to enlarge) I hacked and slashed ruthlessly...and have the stories down to a manageable number, so I hope you have to time to at least skim all of them. You will not witness a more blatant intervention in the free markets than we saw in gold, silver and platinum yesterday. In a broken system, you must be your own central bank, Sinclair tells King World News. John Embry comments about Thursday's intervention against gold. South Africa mining production falls 12.7%. ¤ Critical ReadsSubscribeBloomberg News confirms that stock market was rigged: John CrudeleSo now do you believe me? The stock market was rigged. It has been a little lonely telling this story over the past few years. But now that another news organization has finally gotten off its lazy butt, I'll tell it again: Under former Treasury Secretary Hank Paulson, confidential government information was regularly leaked to select people on Wall Street. As I've explained many times before, the Post got hold of Paulson's telephone records back in 2009. And the phone logs show that Paulson, the former head of Goldman Sachs, regularly spoke with influential people on Wall Street with whom he shouldn't have been communicating. These phone calls could have been -- let's use the word "enriching" -- for the recipients. John Crudele has every reason to gloat. He was right all along This piece was posted over at the New York Post yesterday. The headline reads "Fix was in: Bloomberg mag seconds a scoop". It's a short must read that I pulled from a GATA release yesterday...and the link is here.  U.S. 10-year yields fall under 2% after ECBTreasury prices turned higher on Thursday, pushing 10-year yields under 2%, after European Central Bank President Mario Draghi doused hopes that it would step up purchases of euro-zone bonds. U.S. equities and the euro fell, leading investors back to the relative safe harbor of U.S. bonds. Treasuries "continue to trade off of the selloff in domestic equities following a somewhat disappointing ECB announcement — as the central bank failed to commit to more or unlimited bond-buying to support the peripheral sovereign debt markets," said David Ader, head of government bond strategy at CRT Capital Group. This marketwatch.com story from yesterday is courtesy of Florida reader Donna Badach...and the link is here.  Bond investors soon may be less mesmerized: Murray PollittMurray Pollitt of Pollitt & Co. in Toronto writes that investors, having long been mesmerized by government bonds, are beginning to regain consciousness, realizing that currency (and bond) devaluation is the only way out for over-indebted governments. Pollitt predicts that investors increasingly will move from the bond markets to the stock markets. Pollitt's commentary is headlined "Mesmerized". It's another item that I lifted from a GATA release yesterday...and I also thank Chris Powell for wordsmithing the preamble. This is well worth reading...and the link is here.  Stress Test Results: European Banks Need 115 Billion EurosThe European Banking Authority has determined that banks in Europe need an additional 115 billion euros to conform with new capital ratio requirements. The sum is higher than an October estimate, largely because of capital deficits found at banks in Germany. EU leaders increased capital requirements on the Continent in an effort to slow the growing mistrust of European financial institutions. With the euro-zone debt crisis still spreading, banks with large holdings of European sovereign bonds, particularly from debt-stricken countries, have been viewed with suspicion by other financial institutions. Interbank lending has slowed as a result. Where will all this money come from, dear reader? Out of thin air, somewhere over the rainbow, then take a left at 'Never Never Land'. This story was posted on the German website spiegel.de yesterday...and is Roy Stephens first offering of the day. The link is here.  ECB Downplays Its Role as EU Seeks Crisis DealThe European Central Bank acted to soften a looming recession and avert a credit crunch by cutting interest rates and offering banks long-term funds on Thursday but doused hopes of dramatic crisis-fighting action in the euro area. ECB President Mario Draghi discouraged expectations that the bank would massively step up buying of government bonds if European Union leaders agree on moves towards closer fiscal union at a crucial Brussels summit. The euro and European shares dived as markets, increasingly convinced that only the ECB has the power to protect the euro zone, focused on what Draghi was cool about rather than the measures he announced. "One step forward, two steps back," said Alan Clarke, UK and euro zone economist at Scotia Capital. "The euro zone leaders might as well not bother. Pack their bags, go home, enjoy the weekend and do their Christmas shopping." This CNBC story from yesterday was sent to me by West Virginia reader Elliot Simon...and the link is here.  Britain Suffers as a Bystander to the Euro's CrisisNo matter what happens at the European summit meeting on the euro in Brussels that begins Thursday, Britain is sure to lose. There is looming recognition at 10 Downing Street that if the euro falls, Britain will sink along with everyone else. But if Europe manages to pull itself together by forging closer unity among the 17 countries that use the euro, then Britain faces being ever more marginalized in decisions on the Continent. Despite all that is at stake, Prime Minister David Cameron's coalition government looks doomed to be cast in the role of impotent bystander, torn between anti-Europe forces and European leaders' moves toward greater fiscal integration on the Continent — with or without Britain. This story was in the Wednesday edition of The New York Times. It's worth the read...and I thank Phil Barlett for bringing it to my attention. The link is here. | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| South Africa mining production falls 12.7% Posted: 08 Dec 2011 09:05 PM PST  South Africa's mining production contracted sharply in October, falling by 12.7% year-on-year, data released by Statistics South Africa showed on Thursday. The decline comes on top of a revised 3.9% contraction in September, which the Nedbank Economic Unit said suggested that the impact of weaker global growth was filtering through to the domestic economy. Platinum-group metals production, which makes up the largest portion of South Africa's total mining output, fell by 27.3% year-on-year. Other big decreases were registered in nickel and copper, with output falling 35% and 37%, respectively. Coal output was 9% weaker, diamond production dropped 5% and gold production fell 3.3% | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| February Gold’s ‘Technicals’ Are Firming Posted: 08 Dec 2011 08:55 PM PST |
We witnessed a somewhat disappointing performance from the ECB's Mario Draghi yesterday, at least for those that were expecting the "big bazooka", and many in financial markets were. After all if the ECB is to exceed its treaty-defined mandate, it might as well get the go-ahead from the original source of that mandate: elected representatives of euro-member countries. So the central bankers left their options open and passed the buck to the politicians 
There are growing fears that an economic collapse is on the way. Is this fear justified? Before we conclude that it is a by-gone conclusion and that it's time to head for the hills, let's first cover how and why an economy collapses. In this essay I talk about economic collapse as an "internal event". Keep in mind that there are "external" reasons for an economy to collapse (such as war and/or natural events such as earthquakes etc.)
How do you decide whether you are wealthy or not? Do you determine that by how much money you spend at the stores? Of course not. You can tell if you are wealthy or not by comparing your assets (the money in your bank account, equity in your home, etc.) to your liabilities (your mortgage, credit card debt, student loan debt, etc.). Well, a lot of Americans seem to believe that just because a lot of money is circulating in our economy that it must mean that we are a wealthy nation. But that is simply not true. To tell whether or not America is a wealthy nation, you need to look at the balance sheet numbers. And when you look at the balance sheet numbers, a very sobering story emerges. Over the past three decades, government debt, business debt and household debt have absolutely exploded, but our assets have not. That means that we are getting poorer as a nation. Hopefully the shocking charts and statistics in this article will help a lot of Americans to wake up. Yes, we once were the wealthiest nation on earth, but today America is no longer a wealthy nation.
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