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- Gold Derivatives, Gold Lending, Official Management Of The Gold Price (Lima, 2002)
- Paul Tustain: Be Wary of Balance Sheet Risk
- Fabian4Liberty: Financial Collapse, When?
- WATCH: Silver Manipulation
- Strange Dumping of Gold at Comex Close, Fund Manager Bryan Says
- The war that will kill the dollar: Richard J. Maybury
- Jeff Christian: The CPM Gold Yearbook 2012
- Some Answers to Doug Casey’s Questions
- How to play the gold mining sector - Brent Cook and Dominic Frisby
- Silver Update: “Pirate Economy”
- King World News Under Attack
- Starbucks 2Q12 Earnings Preview: A Strong Quarter In The Brewing
- The Worst Is Over For US Treasuries
- Useless Gold Overtakes Platinum
- Global Gold Production History
- The Semantic Subversion of the Gold Standard and Free Banking
- A Critique of the Quantity Theory of Money
- Chris Waltzek Interviews: John Embry & Timmins Gold Corp CEO, Bruce Bragagnolo
- By the Numbers for the Week Ending April 13
- Gold and Silver Disaggregated COT Report (DCOT) for April 13
- Student Loan Bubble May Provide Next Economic Blow-Up
- Burma: The Biggest Emerging Market Story Since China in 2001
- China’s Economic Growth: A Financial Wonder of the Modern World?
- Friday ETF Roundup: VXX Recovers, XLF Leads Losses
- Bearishness In Energy And Materials Suggests A Shift Toward High Income ETFs
- Goldcorp Ready To Rocket Higher From Acquisitions, Gold Prices
- Arensberg – Sell a Little Gold To Buy Junior Mining Shares
- Bob Chapman - Gold Radio Cafe - April 13, 2012:
- Bullish Gold Technicals
| Gold Derivatives, Gold Lending, Official Management Of The Gold Price (Lima, 2002) Posted: 14 Apr 2012 06:12 AM PDT |
| Paul Tustain: Be Wary of Balance Sheet Risk Posted: 14 Apr 2012 04:06 AM PDT In this interview, Chris and Paul discuss gold's current range-bound trading. In general, he's in favor of a stay-the-course approach for bullion investors at the moment as world markets work through their liquidity-induced "sugar highs": from ChrisMartensondotcom: ~TVR |
| Fabian4Liberty: Financial Collapse, When? Posted: 14 Apr 2012 04:04 AM PDT Many agree the current financial system is unsustainable the question is how much longer can this last? With out the much needed QE from the central banks how much longer can this economy truly last? And what event will trigger global meltdown? Thanks for watching and subscribe for weekly updates. Follow me @ Fabian4Liberty from Fabian4Liberty: ~TVR |
| Posted: 14 Apr 2012 03:59 AM PDT Chris Duane of Truth Never Told documents the ongoing silver manipualtion. from TruthNeverTold: Part One Part Two ~TVR |
| Strange Dumping of Gold at Comex Close, Fund Manager Bryan Says Posted: 14 Apr 2012 01:38 AM PDT ¤ Yesterday in Gold and SilverThe gold price spent all of Far East trading and most of the London morning, floating around between unchanged and down five bucks. But at 12:35 p.m. in London, a somewhat more substantial selling pattern appeared...and by about 1:15 a.m. in New York, gold was down about ten bucks from Thursday's closing price. Then, out of nowhere, the bid disappeared...and within forty-five minutes, gold was down another fifteen plus dollars. The low price tick of the day [$1,647.90 spot] came just minutes after 2:00 p.m. in electronic trading...and from there recovered about ten bucks going into the 5:15 p.m. Eastern time close. The gold price finished the day at $1,658.50 spot...down $16.80...precisely one percent from Thursday. Net volume was exactly the same as Thursday...around 121,000 contracts.
Silver's price path was almost a carbon copy of gold's price action, except the price was more 'volatile'. The big difference was in the timing. Although silver's price decline began at the same 12:35 p.m. BST in London as gold did, it's decline was more precipitous...and the really serious price decline began just a few minutes after the close of trading in London...which was 11:02 a.m. Eastern time. Silver's low price tick [$31.23 spot] was in about 1:20 p.m. Eastern...ten minutes before the close of Comex trading...and just a few minutes after the bid disappeared in gold. The silver price gained back 30 cents within minutes...and then proceeded to trade sideways until the 5:15 p.m. close of electronic trading in New York. Silver finished the Friday trading session down 88 cents from Thursday and, strangely enough, net silver volume was the same as it was on Thursday...around 37,000 contracts.
Here's the New York Spot Silver [Bid] chart that shows the Comex trading day...and the electronic session that follows...in far more detail.
All of gold and silver's gains from Thursday...plus a bit more...disappeared on Friday, April 13th. The dollar index was in a bit of a rally mode right from the 6:00 p.m. open in New York on Thursday night...but really took flight around 12:35 p.m. in London which, not coincidentally, was the precise moment that gold and silver price began their trips to the nether reaches of their respective price charts. Almost 100 percent of the subsequent rally in the dollar index was in by just minutes after 11:00 a.m. in New York, which was the precise time that silver began its big sell-off on the Comex. From that point the dollar traded flat until 5:15 p.m. Eastern. Virtually all of gold and silver's big dollar index-related losses were in by 11:02 a.m. Eastern time...and what happened to the precious metals after that time, was certainly had nothing to do with the dollar.
If you look at the Kitco gold chart above you will note a recovery in the gold price between 10:30 and 11:02 a.m...and even though the gold stocks gapped down at the open, the low of the day was in around 10:00 a.m. Eastern...and bounced off that price many times until the gold price recovered about five bucks...and away the gold stocks went to the upside. That rally lasted until a few minutes after 11:00 a.m. Eastern time...and you know what happened to both gold and silver from there...especially silver. And need I remind you that the rally in the dollar index ended at precisely the same moment. But, despite the drop in the gold price starting at 1:15 p.m. in New York, you'd be hard pressed to spot it on the chart below. The HUI only finished down 1.69% on the day...and in the face of what happened to the gold price going into the Comex close, I consider that a big win.
With silver down almost three percent on the day, the associated equities did not do well...and Nick Laird's Silver Sentiment Index closed down 2.82%.
(Click on image to enlarge) After Thursday's big Daily Delivery Report from the CME, it was back to normal on Friday, as that report showed only 6 gold contracts posted for delivery on Tuesday. Unless someone shows up out of the blue to take delivery of a huge chunk of Comex silver...silver deliveries are pretty much done for, with only a handful left in the April delivery month. But there's still miles to go in gold. There were no reported changes in GLD yesterday...but 873,837 troy ounces of silver were withdrawn from SLV. The U.S. Mint reported selling 1,000 ounces of gold eagles. One has to wonder why they even bothered issuing a report yesterday. It was another busy day over at the Comex-approved depositories on Thursday. This time they reported receiving 1,255,060 troy ounces of silver...and shipped 269,623 ounces of the stuff out the door. The link to that action is here. Ted Butler told me that he expected that the Commercial net short position in silver was going to show a decline of about 5,000 contracts in yesterday's Commitment of Traders Report. The actual number was 4,950 contracts. Not a bad guess. The Commercial net short position is now down to 131.9 million ounces, which is a really small number. As of the Tuesday cut-off, the '1-4' largest short holders in the Comex silver futures market are short 171.1 million ounces. The '5-8' largest traders are short an additional 41.8 million ounces on top of that. Once you remove the market-neutral spread trades from the Non-Commercial category, these '1-4' traders are short 37.8% of the entire Comex futures market...and it's a pretty good bet that JPMorgan is short about half of that on its own. The '5-8' traders are short another 9.2 percentage points as well, so the '1-8' large traders holding short positions in silver are short 47.0% of the entire Comex futures market in that commodity. To put this into some sort of perspective...and to give you an idea of how concentrated this silver short position really is...there are 75 traders holding short positions in the Non-Commercial category...and that includes the 42 holding spread trades. There are 45 traders holding short positions in the Commercial category...and in the Nonreportables, there are literally thousands. Eight traders are short 47 percent of the entire Comex futures market in silver...thousands holding the other 53% short. If this is not a concentrated short position, I don't know what is. The CFTC know this all too well. They should, as it's their data from their own report as of yesterday. The situation is actually worse than this. I use the legacy COT report for both silver and gold. Ted [and others] use what is called the Disaggregated COT Report. When you take out the additional spread trades reported in that, then the concentrated short position of the '1-8' traders is even higher than the numbers I'm reporting above. In gold, the Commercial net short position only improved by 6,415 contracts. Ted was expecting around a 15,000 contract improvement. He said it didn't happen because the rally on Tuesday punctured the 20-day moving average in gold with some authority...and a lot of technical funds bought when that average was broken to the upside. As of the Tuesday cut-off, the Commercial net short position in gold was down to 17.1 million ounces. The '1-4' largest short holders are short 11.0 million ounces...and the '5-8' largest short holders are short an additional 5.4 million ounces. Between all of the 'big 8' short holders, they are short 95.9% of the Commercial net short position in gold. But in silver, the 'big 8' are short 161.4% of the Commercial net short position. Here's Nick Laird's wonderful chart..."Days of World Silver Production" of the '1-4' and '5-8' largest traders in all Comex-traded commodities. The bars for silver and gold are visual representations of what I just spoke of above.
(Click on image to enlarge) Here's another chart from Nick Laird which he slid into my in-box just after midnight. It's his "Total PMs Pool" graph, which is now at a new record high in ounces. Here was his accompanying commentary..."Hi Ed, Here we are at new highs in number of ounces held. Of note, the UBS Gold ETF put on 261,766 oz. of gold this week. Cheers. Nick"
(Click on image to enlarge) So even though 'da boyz' are mucking about with the price, the smart money is still quietly socking it away...and that's what you should be doing as well, dear reader. I have the usual number of stories for a weekend...and some I've been saving for today because of length or content, or both. I hope you have the time to sift through them all. Well, was it free-market forces at work in the thinly-traded Friday afternoon market in New York...or was it JPMorgan et al? Where's the Beef for Gold Equities? - Frank Holmes. GoldMoney & BullionVault clients of all people most to be pitied? Gold standards: What is the value of an Olympic gold medal? ¤ Critical ReadsSubscribeEgan Jones Downgrades JPMorganThe iconoclastic rating agency, and fully recognized NRSRO to the dismay of some tabloids, which just refuses to play by the status quo rules, and which downgraded the US for the second time last Friday, to be followed soon by other rating agencies as soon as US debt crosses the $16.4 trillion threshold in a few short months, has just done the even more unthinkable and downgraded Fed boss JPMorgan from AA- to A+. West Virginia reader Elliot Simon sent me this zerohedge.com piece late last night...and the link is here.  U.S. tests rare legal path in financial crisis casesAn Obama administration task force established to investigate misconduct that fueled the financial crisis is turning to a little-used statute that may make such cases easier to bring, according to people familiar with the matter. The federal statute, FIRREA, was passed in the wake of the savings-and-loan scandals in the 1980s. It requires a lower burden of proof than criminal charges, has a longer statute of limitations than other financial laws and potentially could bring big fines. It is unclear how successful the growing use of FIRREA will be. Lurie, the former Justice official, said it's "largely uncharted territory," and defense lawyers have already started pushing back on the government's use of the law. This Reuters story from yesterday was sent to me by reader Andrew Holland...and the link is here.  All Eyes on Spain: Doug Noland"By this point in the ongoing global Credit crisis, it should be clear that the real villain is the anchorless global Credit "system" devoid of anything, any mechanism, or any "sound money and Credit" ideology that might help to restrain excess. Self-adjustment and automatic self-correcting mechanisms would be invaluable. Instead, our central bank, steward of the world's so-called "reserve currency," indicates its willingness to become even more "activist" - and global finance spirals only further out of control. For decades now, global Credit has been allowed to expand unchecked – with no limit to either the quantity or quality of debt instruments. Perhaps the timing and sequencing of various crises was unknowable, though the end results were, for the most part, predictable." Doug Noland is at the top of his game in his weekly Credit Bubble Bulletin posted over at the prudentbear.com website. It's a must read for sure...and I thank reader U.D. for bringing it to our attention. The link is here.  The war that will kill the dollar: Richard J. MayburyThis is the speech that Richard gave at the Casey Research/Sprott Summit in Phoenix, Arizona on October 1, 2011. I thank reader 'David in California' for sending it to me in the wee hours of this morning. The link is here.  IMF's Lagarde: World Economy Highly UnstableThe IMF is raising its forecasts for global growth from levels it expected in January, but there is still a "high degree of instability" in the world economy, Managing Director Christine Lagarde says in an interview with the WSJ's David Wessel. This 11:44 minute video was posted over at the marketwatch.com website on Thursday. I had to click on the "Pop Up Player" feature in order to get it to play...and you may have to resort to that as well. I thank Florida reader Donna Badach for sending it...and the link is here.  Iceland Exports Energy as DataIceland's main exports are aluminum and fish. Now the isolated nation is hoping to offer the world a new commodity: a cheap, guiltless way to store its data. In February, a startup called Verne Global opened a large server farm on an old NATO base near Iceland's main airport and began offering "100% renewable" computing services to the rest of the world. It's one of three data centers in Iceland and part of what Iceland's government hopes will be a new local industry. Iceland produces more electricity per capita than any other country in the world. Nearly all its power is renewable, coming from either glacier-fed rivers or steaming geothermal vents. And it's cheap, too. At 4.3 cents per kilowatt-hour, electrons on the island cost around half the average retail rate in the United States. This very interesting story was posted on the technologyreview.com website on Wednesday...and I thank Roy Stephens for his first offering of the day. The link is here.  Iceland's volcanoes may power the U.K.The volcanoes of Iceland could soon be pumping low-carbon electricity into the UK under government-backed plans for thousands of miles of high-voltage cables across the ocean floor. The energy minister, Charles Hendry, is to visit Iceland in May to discuss connecting the UK to its abundant geothermal energy. "We are in active discussions with the Icelandic government and they are very keen," Hendry told the Guardian. To reach Iceland, which sits over a mid-ocean split in the earth's crust, the cable would have to be 1,000 to 1,500km long and by far the longest in the world. |
| The war that will kill the dollar: Richard J. Maybury Posted: 14 Apr 2012 01:38 AM PDT  This is the speech that Richard gave at the Casey Research/Sprott Summit in Phoenix, Arizona on October 1, 2011. I thank reader 'David in California' for sending it to me in the wee hours of this morning. The link is here. |
| Jeff Christian: The CPM Gold Yearbook 2012 Posted: 14 Apr 2012 01:10 AM PDT Jeff Christian is a complete Toole, his company makes millions of FRNs advising mining companies and others on how to do forward hedges and the like. But the Gold Yearbook is a "leading authority", so his commentary is noteworthy. Quote: Jeff Christian: The CPM Gold Yearbook 2012 Another year of strong investment demand and rising average prices ahead for gold, with price spikes possible, but unlikely |
| Some Answers to Doug Casey’s Questions Posted: 14 Apr 2012 01:00 AM PDT April 13, 2012 In the April edition of The Casey Report, Doug Casey tackles the matter of gold price manipulation. He does this in an excellent article comparing gold's bull market today |
| How to play the gold mining sector - Brent Cook and Dominic Frisby Posted: 13 Apr 2012 11:00 PM PDT In this podcast, Brent Cook, geologist and writer of Exploration Insights, and the GoldMoney Foundation's Dominic Frisby talk about the current state of the gold mining sector and how to invest in it. ... This posting includes an audio/video/photo media file: Download Now |
| Silver Update: “Pirate Economy” Posted: 13 Apr 2012 10:39 PM PDT |
| Posted: 13 Apr 2012 10:10 PM PDT VNote: This story was copied in full as the GATA site was experiencing load errors.
from gata.org: Dear Friend of GATA and Gold: The King World News Internet site was attacked this week in ways that seemed aimed particularly at the network's revelatory interview April 5 with its London metals market trader source. The major Internet hosting company that maintains the King World News site reported to the network: "The servers you are hosted on are what we call 'under guard' due to external attack. Sometimes there are millions of these attacks. Without these 'guards' in place, the servers would effectively become flooded and would be unable to display your website." Eric King told GATA today: "The attacks started when the London trader interview piece was released April 5. The attacks continued and intensified when our interview with Jim Sinclair's futures market analyst, Dan Norcini, was published on April 11. A very powerful entity King World News experienced a similar "distributed denial of service" attack in March 2010 immediately after it carried an interview with three GATA board members. This week's attack blocked access to the King World News site for some of its readers around the world. After many hours of work by the site's staff, access has been restored. In a way, these attacks are a tribute to the work done by King World News and the sensitivity of the observations made by the people interviewed there. GATA's dispatch about the April 5 King World News interview with the London trader is here: http://www.gata.org/node/11215 GATA's dispatch about the April 11 King World News interview with Norcini is here: http://www.gata.org/node/11236 GATA's dispatch about the March 2010 attack on King World News is here: http://www.gata.org/node/8494 CHRIS POWELL, Secretary/Treasurer Keep on reading @ gata.org |
| Starbucks 2Q12 Earnings Preview: A Strong Quarter In The Brewing Posted: 13 Apr 2012 09:07 PM PDT By Jiang Zhang: Starbucks (SBUX) will report 2Q12 results on April 26th. The Street expects the firm to earn $0.39 per share on $3.18 billion in revenue, and guide $3.3 billion for Q3. Heading into the earnings, investors can expect:
SBUX introduced its K-Cup in November 2011 and instantly took 7.7% dollar share of the market. Since then, SBUX's dollar share of the K-Cup market almost doubled to 14% while Green Mountain Coffee Roaster (GMCR) saw its dollar share decline from 70% to 57% from November 2011 to March 2012. Despite accounting for only 7% of the company's total 2011 revenue, the CPG business, which consists of mostly packaged coffee and tea, is emerging as a key revenue driver as SBUX looks to expand its Complete Story » |
| The Worst Is Over For US Treasuries Posted: 13 Apr 2012 08:57 PM PDT A New Report Says The Worst Is Over For US Treasuries. We Say The Worst Is Just Beginning. Investors Buying This Paper Want To Be Fairly Paid For Taking Risks. We Say The Risks Are Already Very High And Going Higher Faster. Having To Pay More Interest Will Crush The Global Bond System With Inflation First; Followed By Hyperinflation. "Biggest Bond Traders See Worst Over for Treasuries." –Bloomberg.net 4-2-12 Wall Street bond traders say the worst is over as things temporarily cooled down. This is a calm before the storm as the stealth QE-3 has been underway since July 1, 2011, and the money credit swaps are spent. They would never dare make talk of a QE-4, or central bankers would immediately face a global credit collapse. Rather, a stealth printing of bonds and currencies continue at a faster pace driving inflation ever higher. We see $5.00 gas this summer and even higher in the fall. Greece and Portugal are goners with their mess baked into the financial cake. However, when Italy, Spain or, the U.K. slide over the edge, all bets are off as the world runs for economic and financial cover. Can "Extend And Pretend" continue? Sure, but not indefinitely. "The worst is over for the $10 trillion U.S. Treasury market following the biggest quarterly rout since 2010, say Wall Street's largest bond trading firms." Editor: We say the worst is just beginning. Media comments are designed to calm troubled investment waters for the Sheeple and feather nests of bond trading firms. "After rising to as high as 2.4% last month from 1.88% at the end of 2011, the yield on the benchmark 10-year note will finish 2012 at 2.48%, according to the average estimate in a Bloomberg News survey of the 21 primary dealers that trade with the Federal Reserve. That's the same as a January poll, suggesting the market isn't ready to declare a bear market in bonds after a 30-year bull run." Editor: The charts say something different. "Signs of strength in the economy, which caused a -5.56% loss in bonds maturing in 10 years or, more last quarter, may fade in the second half of 2012, the dealers say. Tax cuts are expiring, $1 trillion of mandatory federal budget cuts are due to kick in and $100-a-barrel oil is eating into consumer spending. With inflation in check, Fed Chairman Ben S. Bernanke, said last week, that the central bank will consider further stimulus, even after up-grading its economic outlook March 13." Editor: Expiring tax cuts will crush business, deepening Greater Depression II. Crude oil is going higher along with other fuels on inflation and fears of supply. Those mandatory budget cuts are a massive shell game as spending increases not decreases. "Primary dealer holdings of U.S. government debt rose to $91 billion last month, from a net bet against the securities of $53.4 billion in May, according to the Fed. In the survey, 14 say the odds are that the Fed will need a third round of bond purchases, or quantitative easing, to bolster the economy. The yield on the benchmark 10-year note was little changed at 2.22% at 7:21 a.m. in New York, according to Bloomberg Bond Trader prices. The 2% security due in February, 2022 fell 1/32, or 31 cents per $1,000 face amount, to 98 3/32." "Housing reports during last two weeks showed a key part of the economy remains under pressure. The Commerce Department said March 23 new home sales fell to a 313,000 annual pace in February, the slowest since October, from the 318,000 rate in January that was weaker than previously reported. The National Association of Realtors said existing-home sales eased to a 4.59 million rate last month from January's 4.63M." "Unusually Large Layoffs: The economic recovery isn't yet assured and unemployment remains too high, Bernanke told ABC News anchor Diane Sawyer, according to transcripts of the interview released March 27." "The remarks came a day after Bernanke said in a speech that the drop in the unemployment rate to 8.3% (Editor: It's 22.5% jobless and will be 30% within 18 months along with 70,000,000 on food stamps), may reflect 'a reversal of the unusually large layoffs that occurred during late 2008 and over 2009. Significant further improvement would likely require faster growth, he said. The Fed hasn't tightened monetary policy with joblessness at the existing level since it fought surging inflation in the 1980s." "In the past week Bernanke's gotten in front of every microphone he could find and gotten the market to realize that we shouldn't have priced out QE3 and, even if you don't think it's going to happen you have to attribute some sort of probability to it, and that he's going to stay accommodative and potentially increase accommodation," John Briggs, a U.S. government bond strategist at primary dealer RBS Securities Inc. in Stamford, Connecticut, said in an interview on March 28." "Yield forecasts at the primary dealers range from 2% at RBS, Scotia Capital and Barclays Capital to 3% at Deutsche Bank AG, Jefferies & Co. and BMO Financial. Even if the most bearish forecasts prove true, yields would remain below the average of 3.85% over the past decade, 4.98% over the past 20 years and 6.48% since 1982. The bull market for bonds began after then-Fed Chairman Paul Volcker began to lower borrowing costs from a high of 20% in 1980 after taming inflation." "President Barack Obama needs the support of the bond market to help finance a budget deficit projected to exceed $1 trillion for the fourth year as he runs for re-election in November. While the amount of marketable debt outstanding has more than doubled to $10.2 trillion from $4.34 trillion in mid-2007 as the U.S. sold bonds to pay for spending programs designed to pull the economy out of the worst financial crisis since the Great Depression, interest expense equaled 3% of the economy in fiscal 2011 ended September 30. That's down from 4% in 1999, when the U.S. ran budget surpluses." "Rising Loans: There are enough signs of strength in the economy and credit markets to keep the Fed from adding more stimulus, according to Maury Harris, the chief economist at primary dealer UBS Securities LLC in New York. Fed data show commercial and industrial loans outstanding rose to $1.38 trillion as of March 14 from the post-crisis low of $1.2 trillion in October, 2010." "We're going to have some spring slowdown in housing, some spring slowdown in employment, and the first opportunity they get to juice the system they will," Steven Ricchiuto, chief economist in New York at primary dealer Mizuho Securities USA, said in a March 28 telephone interview in reference to Fed policy makers." -Susanne Walker and Daniel Kruger 4-2-12 Blomberg.net
        This posting includes an audio/video/photo media file: Download Now |
| Useless Gold Overtakes Platinum Posted: 13 Apr 2012 05:15 PM PDT |
| Global Gold Production History Posted: 13 Apr 2012 04:30 PM PDT Goldsheet Links |
| The Semantic Subversion of the Gold Standard and Free Banking Posted: 13 Apr 2012 04:30 PM PDT Mises.org |
| A Critique of the Quantity Theory of Money Posted: 13 Apr 2012 04:00 PM PDT Gold University |
| Chris Waltzek Interviews: John Embry & Timmins Gold Corp CEO, Bruce Bragagnolo Posted: 13 Apr 2012 02:58 PM PDT Apr. 13, 2012 20,000 Global Listeners Toll Free Hotline - Q&A: 1-800-507-6531 NEW: Richard Daughty, AKA The Mogambo Guru's New Blog! Click here. Featured Guests: John Embry... GREATEST INVESTMENT INFO ON THE WEB!!!      This posting includes an audio/video/photo media file: Download Now |
| By the Numbers for the Week Ending April 13 Posted: 13 Apr 2012 02:06 PM PDT |
| Gold and Silver Disaggregated COT Report (DCOT) for April 13 Posted: 13 Apr 2012 01:41 PM PDT HOUSTON -- This week's Commodity Futures Trading Commission (CFTC) disaggregated commitments of traders (DCOT) report was released at 15:30 ET Friday. Our recap of the changes in weekly positioning by the disaggregated trader classes, as compiled by the CFTC, is just below. In the DCOT table below a net short position shows as a negative figure in red. A net long position shows in black. In the Change column, a negative number indicates either an increase to an existing net short position or a reduction of a net long position. A black figure in the Change column indicates an increase to an existing long position or a reduction of an existing net short position. The way to think of it is that black figures in the Change column are traders getting "longer" and red figures are traders getting less long or shorter. All of the trader's positions are calculated net of spreading contracts as of the Tuesday disaggregated COT report.
Continued… Vultures, (Got Gold Report Subscribers) please note that updates to our linked technical charts, including our comments about the COT reports and the week's technical changes, should be completed by the usual time on Sunday evening (around 18:00 ET). As a reminder, the linked charts for gold, silver, mining shares indexes and important ratios are located in the subscriber pages. In addition Vultures have access anytime to all 30-something Vulture Bargain (VB) and Vulture Bargain Candidates of Interest (VBCI) tracking charts – the small resource-related companies that we attempt to game here at Got Gold Report. Continue to look for new commentary directly in the charts often. |
| Student Loan Bubble May Provide Next Economic Blow-Up Posted: 13 Apr 2012 12:30 PM PDT Most people thought it would be a euro collapse or the second wave of home mortgage foreclosures that would bring about the next financial crisis. Now we learn it may instead be the seemingly benign institution of student loans that brings the whole thing crashing down. And no one in the political arena seems to be paying much attention to the issue. U.S. student loan debt has accelerated since the 2008 crisis, in part because layoffs, wage cuts and job losses incentivized more students to stay in college a while longer or to enter or return to college. Nationally, student loan debt has outpaced credit card and mortgage debt, exceeding $1 trillion, and is growing by $40 billion to $50 billion per month. Some 27% of all student loans are at least 30 days delinquent—and that does not count the vast majority of those currently holding student loan debt—as many as 47%—who are still in school and aren't required to begin making payments until six months after they graduate or leave school, as Tyler Durden of ZeroHedge reported recently. |
| Burma: The Biggest Emerging Market Story Since China in 2001 Posted: 13 Apr 2012 10:05 AM PDT About five years ago I had the fortune to take a month-long tour through Myanmar (Burma) with a group of Burmese and Japanese friends. For the most part, we travelled on buses - relics from World War II that were crammed with people throughout our trip. Our fellow passengers offered us miniature wooden stools placed in the middle of the aisle to sit down on. And we stared out the window at the strange country that rushed past. Myanmar absolutely mesmerised me. It is blessed with lush paddy fields, dramatic mountain ranges and people who seemed untouched by the modern world. We'd pass women and children with exquisite white-painted faces from thanaka cream. And almost every corner had an ancient Buddhist temple where local people asked for alms to paint or repair it. I was considering learning Burmese and staying. For the last month, Myanmar has been back in the spotlight. On 1 April, the country held a landmark by-election, which could soon sweep the recently freed Aung San Suu Kyi to power. If the election is deemed fair, the EU and the US will lift some of their long-standing trade sanctions. Myanmar is also set to float its currency, the kyat, to attract investments and reduce corruption. These reforms could bring decades of international isolation to an end. And the country has been swarming with foreign businessmen and politicians in recent weeks. Western companies are queueing up to get into the country, sandwiched between China and India and offering huge potential in energy and tourism. Even David Cameron has announced his intention to visit. But you can forget China, India - and certainly David Cameron. Because Myanmar is part of a far more interesting investment story. In fact, I think that this will be the most exciting story of the next five years. And it promises to deliver some explosive returns for early investors.
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| China’s Economic Growth: A Financial Wonder of the Modern World? Posted: 13 Apr 2012 10:00 AM PDT One of the true wonders of the modern world, which goes largely unrecognised, is that China manages to collate and report its quarterly economic growth to the world in less than two weeks. That's right - just two weeks to report on the collective activities and output of over 1.3 billion people. In contrast, Australia takes over three months. We know China is a centrally planned economy (and that Australia suffers from poor productivity performance) but this is ridiculous. Even more ridiculous is the West's desire to believe and hang onto every bit of data that flows out of China, no matter how dubious. Well, as dubious as it may be, Chinese economic growth came in at an annualised 8.1 per cent for the three months to March. While this is the slowest pace of growth in nearly three years, it should not come as a major surprise. Just recently, outgoing Premier Wen Jiabao said China's aim was for economic growth of 7.5 per cent this year. So the consensus view will no doubt be along the lines of 'this is all a part of the slowdown and rebalancing plans'. But don't believe the hype. China's economic growth problems are both huge and complex. Its 12th Five Year Plan (2011-15) calls for a rebalancing away from investment and exports and a focus on consumption-led growth. But two years into the plan, that's not happening. China tried to engineer a slowdown in investment in 2011. Tighter monetary policy saw loan growth and money supply decelerate sharply (see chart below). This caused China's massive investment boom (basically a property and infrastructure boom) to start deflating. But there were little signs of the consumer coming to the rescue. So the central planners got nervous and loosened monetary policy again. It turns out China is back to its old ways…relying on credit growth and investment to hit its economic growth targets. We saw evidence of this on Thursday. The Peoples Bank of China released monetary data for March. M2 money supply grew 13.4 per cent year on year, representing the second consecutive month of accelerating money supply growth. Loan growth for the month came in at 1.01 trillion yuan (around US$160 billion), well above expectations of around 800 billion. As you can see in the chart below, net new loans (the blue bars) have grown strongly since bottoming out in late 2011.  Increasing debt levels is an easy way to promote economic growth. But it says nothing about the quality of that growth. If you look back a few years, you can see the result of the explosion of debt in China. There is spare capacity everywhere…from steel to cement to railways to airports to residential property…and shopping malls. Click on this link and scroll down to see yet more examples of newly built and absolutely empty shopping malls in China. In other words, like a lot of the stuff that goes on in China, economic growth has been manufactured. Economies should start with providing people with the freedom to do what they want (within reason…or within the law to the extent the law is reasonable). The result of all this human action is economic growth. In China, the bean counters start at the other end. They start with economic growth and work backwards. The result is a whole bunch of activity and output that is not really useful to anyone. It's the curse of the command economy. This renewed increase in bank lending and growing debt is dangerous for China. In a recent blog post, Professor Michael Pettis from Peking University discussed China's options for rebalancing growth away from the debt-fuelled investment model towards greater consumption:
Every country that has followed a consumption-repressing investment-driven growth model like China's has ended with an unsustainable debt burden caused by wasted debt-financed investment. This has always led either to a debt crisis or to a "lost decade" of very low growth. So while the market cheers the short-term impact of renewed monetary loosening and resurgence in uneconomic loan growth (debt growth), keep in mind this represents China moving away from its rebalancing goals. All those who think China can simply ratchet up its growth by lowering interest rates and firing up loan growth are wrong. This old mode of economic growth basically subsidised exporters and the banks (via the provision of cheap capital) at the expense of the household sector. That's why consumption as a percentage of GDP is in the low 30 per cent range, while investment is around 50 per cent. And it's what caused an investment professional to reflect after a recent visit to the Chinese mainland:
The pace of development (i.e. capital misallocation) across the country is simply mind-boggling. Perhaps some second and third tier cities really do need three state-of-the-art high speed train stations? Perhaps the Chinese people really do just shop on weekends leaving massive furniture malls completely vacant Monday through Friday? And perhaps spending more than half of your GDP on "investment" (relative to 16% in the US and 40% during other historical emerging market credit bubbles) is not representative of one of the greatest economic imbalances in history? China's savers are a financially repressed lot. They can't move their funds out of the country, interest rates are lower than inflation, the stock market is well off its highs and property prices are falling too. Increasing consumption will mean undoing much of the financial structure that has existed for decades. Doing so might prove a long and painful task. Not doing so will only risk a much larger crisis in the years to come. Regards, Greg Canavan ALSO THIS WEEK in The Daily Reckoning Australia... The Benefits of Knowing a Stock Market Realist Murray is neither an optimist nor a pessimist. He's a market realist. And in a market where you're basically forced to speculate, it doesn't hurt having an experienced, sober-minded trader on your side. Even if you're not a trader, take a few minutes to read Murray's analysis of the ASX/200 from last week. He called it beautifully. Beware the Big Government Debt Switcheroo In other words, the people who are arguing that Australians have too much money in stocks may also be arguing that Australians have too little money in bonds. And since the corporate bond market is relatively immature, you'd need a bigger, more liquid, and nominally "safer" bond market to park super money in. Presto. Change-o. You now have an argument for why larger government debt is a GOOD thing. It gives super funds another, "safer" asset class in which to park your retirement savings. And while we're at it, let's just lift your compulsory super contribution from 9% to 12%, with a certain percentage mandatorily going into fixed interest assets (government bonds, hush). Misguided Faith in an Economic Recovery The market wants debt destroyed. It wants accounts settled and moribund institutions extinguished. It thirsts for a flurry of "Lehman moments." The market wants capital freed from tarpit-bound enterprises so that newer, fresher-faced companies, with superior products and innovative business models, can make better use of it. It wants errors punished, mistakes corrected and the lessons of the processes therein made available for all to know and to learn from. There's No Such Thing As Too Much Liberty The section on war and the state is particularly poignant: The more government "defends" its citizens, the more it provokes tensions and wars, as unnecessary armies wallow carelessly about in distant lands and government functionaries, from the highest to the lowest, throw their weight around in endless, provocating power grabs. The war machine established by government is dangerous to both foreigners and its own citizens, and this machine can operate indefinitely without any effective check other than the attack of a foreign nation. Is Berkshire Hathaway Suffering From A Case of Gold-Cult Envy? Berkshire Hathaway is a leveraged play on the American enterprise. It always has been...and so it remains. As the American enterprise flourished throughout the last 50 years, so did Berkshire Hathaway. But now that the great American economy has started sputtering a bit, Berkshire's spectacular long-term track record is becoming less and less spectacular. In other words, the world is changing before our eyes, but Buffett seems to have little desire to change with it. Perhaps he is incapable of doing so. He knows what has worked for him and assumes that it always will. Gold has never been a part of Berkshire Hathaway's secret sauce...and it still isn't. Similar Posts:
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| Friday ETF Roundup: VXX Recovers, XLF Leads Losses Posted: 13 Apr 2012 09:56 AM PDT By Jarred Cummans: It seems that yesterday's rumors of strong China GDP growth were merely that, rumors. GDP sank to 8.1%, the weakest in three years, causing stocks to erase Thursday's bull run as volatility spiked yet again, marking one of the more active weeks in recent memory. The Dow lost over 130 points while the S&P surrendered nearly 1.3%, all of this coming even after Google (GOOG), JPMorgan (JPM) and Wells Fargo (WFC) surpassed earnings expectations. While many investors had hoped for earnings season to be the main focus of the next few weeks, global issues concerning the euro debt crisis and now China's lagging growth is creating a major cause for concern. Gold was one of the hardest hit assets on the day, as it sank 25 points, creating a major opportunity for gold bugs around the world. Crude oil also suffered during the week-ending session, as a barrel of crude Complete Story » |
| Bearishness In Energy And Materials Suggests A Shift Toward High Income ETFs Posted: 13 Apr 2012 09:15 AM PDT  By Gary Gordon: The Dow and the S&P 500 may have experienced the worst two-week losses since November. Still, is it really time to panic? When one considers the reality that the major averages are less than -4% from multi-year highs, abandoning stock assets seems a bit premature. That said, you may want to avoid certain investments. For example, a wide variety of Currency ETFs have worked their way into to full-scale correction mode. The CurrencyShares Euro Trust (FXE) is 12.4% below a 52-week high whereas the CurrencyShares Swedish Krona (FXS) is 11.8% off its peak. And while a lack of interest in European sovereign debt may be to blame, the uncertainties in the Chinese economy are adversely affecting Brazil and the value of the real. WisdomTree Dreyfus Brazilian Real (BZF) is down -12.8% from a 52-week pinnacle. Even though the U.S. Federal Reserve has steadfastly devalued the U.S. dollar through its interest Complete Story » |
| Goldcorp Ready To Rocket Higher From Acquisitions, Gold Prices Posted: 13 Apr 2012 08:40 AM PDT By Vatalyst: It appears that, despite some tumultuous months that have seen sharp fluctuations in share price, Goldcorp (GG) has positioned itself through its large-scale acquisitions to ride the current rise in gold price to post profitable results for the remainder of 2012. In large part due to its need to stay competitive with Barrick Gold (ABX), the world's No. 1 miner of gold, Goldcorp made several substantial acquisitions in recent years that are beginning to pay off. In 2006, Goldcorp and Glamis Gold announced a merger that was valued at $21.3 billion. With this merger Goldcorp became the third-largest gold miner in the world. Although many financial experts questioned this massive merger at the time as it did not contribute to Goldcorp's immediate cash flow, Goldcorp's financial circumstances at that Complete Story » |
| Arensberg – Sell a Little Gold To Buy Junior Mining Shares Posted: 13 Apr 2012 08:30 AM PDT Tracy Weslosky CEO for Pro-Edge Consultants Inc. (www.pro-edge.com) interviews Gene Arensberg, Editor of the Got Gold Report (www.GotGoldReport.com | www.GotGoldBlog.com) about why it's a great time to be a "Vulture". Gene talks about what's happening in the market today and how Vultures should be handling this current market sell-off. He says when people are selling their stocks, it's a great time to be buying. Continued, click below to view the video. As a gold investor, Gene tells us he is willing sell a little gold to invest in junior resource companies because of the significant buying opportunities that currently exist. He says, "that's what you have the gold for; it's to preserve your buying power for times when it really works for you." Among the companies on Gene's Vulture Stocks bargain list are Guyana Goldfields Inc. (TSX: GUY) and Northern Tiger Resources Inc. (TSXV: NTR). He says, "we don't get many cascade sell down events like the one we've got now with a buyers' strike...you've got all sellers, no buyers and the price becomes meaningless under those conditions." He also talks about China's influence on the gold market. To gain access to Gene's investment charts and analytical notes subscribe to Got Gold Report. (Recorded Wednesday, April 11, 2012)
Source: Pro-Edge via YouTube http://www.youtube.com/watch?v=STWTTFEfQ1Q
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| Bob Chapman - Gold Radio Cafe - April 13, 2012: Posted: 13 Apr 2012 07:56 AM PDT Bob Chapman - Gold Radio Cafe - April 13, 2012: we are living the end of the... [[ This is a content summary only. Visit my blog http://www.bobchapman.blogspot.com for the full Story ]] This posting includes an audio/video/photo media file: Download Now |
| Posted: 13 Apr 2012 07:48 AM PDT |
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