saveyourassetsfirst3 |
- Buck Up Day - Silver is KING - Here's to you GKhan!
- Patrick Heller: Suppression will cause higher rebounds for gold and silver
- Premiums for gold and silver will rise
- The Power of the Powerless Supports a Raging Silver Bull
- The single best reason to own gold
- Bernanke’s Fed Doubles Down on QE – Just in Time for November
- QE3: Unlimited Purchases With Limited Benefits
- Finding The Best ETFs For Emerging Market Bonds
- QE3 "Could Push Gold Over $1800", But "Disappointment Factor" Seen as High
- Buy 90% for less than spot at Nucleo
- Precious Metals Spike Higher on Fed Stimulus
- Pat Heller: The More Gold And Silver Prices Are Suppressed, The Higher They Will Rebo
- Bonanza Discoveries That Will Drive Gold Stocks: Eric Coffin
- Monetary “Floodgates” And Geopolitical Unrest To Support Precious Metals
- Sentinel Ruling And What It Means For Your Street Name Shares
- German Court Backs ESM Rescue Fund in Double-Edged Ruling
- ‘Best Climate’ Don Coxe Has Ever Seen For Gold Price Increases
- The Fed’s Wizard Behind the Curtain
- China’s Shadow Banking System Collapses Exposing Numerous Ponzi Schemes; Implosion Reaches Critical Mass
- Global Economic Plunge, Money Creation & Soaring Gold
- VC Inspired Reflections on QE3
- Monetary 'Floodgates' & Geopolitical Risks Buoy PMs
- QE3 Launch 'Could Push Gold Over $1800'
- How Coal Brought Us Democracy, and Oil Ended It: Lessons from the New Book “Carbon Democracy”
- ‘Best Climate' Don Coxe Has Ever Seen For Gold Price Increases
- Sentinel ruling may hurt MF Global clients
| Buck Up Day - Silver is KING - Here's to you GKhan! Posted: 13 Sep 2012 12:20 PM PDT |
| Patrick Heller: Suppression will cause higher rebounds for gold and silver Posted: 13 Sep 2012 11:53 AM PDT |
| Premiums for gold and silver will rise Posted: 13 Sep 2012 11:31 AM PDT |
| The Power of the Powerless Supports a Raging Silver Bull Posted: 13 Sep 2012 11:21 AM PDT |
| The single best reason to own gold Posted: 13 Sep 2012 11:18 AM PDT |
| Bernanke’s Fed Doubles Down on QE – Just in Time for November Posted: 13 Sep 2012 11:06 AM PDT In a move some will furiously call political, today the Federal Reserve Open Market Committee (FOMC) issued a statement which calls for more "QE" and lots of it. Just below was the real-time coverage at CNBC of the announcement.
Source: CNBC http://video.cnbc.com/gallery/?video=3000115783 Comment: The Fed is apparently doubling down on easy money policies to goose the flagging economy and shore up moribund employment statistics. With a focus on force feeding lower interest rates to the housing industry, which has been clawing slightly higher in recent weeks, at least the Fed is attempting to focus on an industry that has bipartisan support. The Fed apparently decided that the economy was at stall speed and needed goosing to avoid another slip inot recession. The action is certainly more bullish than bearish for precious metals. |
| QE3: Unlimited Purchases With Limited Benefits Posted: 13 Sep 2012 10:56 AM PDT By Faisal Humayun: The highly anticipated QE3 was finally announced by the Federal Reserve, and the immediate reaction of asset markets has been positive. This article presents a summary of QE3, along with a discussion of its impact on the economic scenario and asset classes. QE3 In Brief According to the FOMC release, the QE3 would encapsulate the following:
Complete Story » |
| Finding The Best ETFs For Emerging Market Bonds Posted: 13 Sep 2012 10:45 AM PDT By Tom Lydon: Bond assets play an important role in any traditional investment allocation strategy, but now, investors may utilize exchange traded funds to diversify away from U.S. debt and gain exposure to emerging market bonds. Emerging market bond ETFs are also offering attractive yields. In the emerging market bond ETF space, the iShares JPMorgan USD Emerging Markets Bond Fund (EMB) is the largest option available, with about $5.5 billion in assets under management. The fund tries to reflect the performance of the J.M. Morgan EMBI Global Core Index, which is market-value-weighted based on countries with the most debt and is made up of U.S. dollar denominated emerging markets bond securities. EMB has a 0.60% expense ratio, a 3.68% 30-day SEC yield, average maturity of 12.1 years and an effective duration of 7.7 - each 1% rise in rates will diminish EMB's price by about 7.7%. Credit quality allocations include AA 1.7%, A Complete Story » |
| QE3 "Could Push Gold Over $1800", But "Disappointment Factor" Seen as High Posted: 13 Sep 2012 10:45 AM PDT |
| Buy 90% for less than spot at Nucleo Posted: 13 Sep 2012 10:40 AM PDT |
| Precious Metals Spike Higher on Fed Stimulus Posted: 13 Sep 2012 10:21 AM PDT Gold and platinum prices jumped by more than $30, silver prices by more than a dollar and palladium by more than $10 after the Federal Reserve issued a statement on Thursday promising continued asset purchases until jobs rebound. |
| Pat Heller: The More Gold And Silver Prices Are Suppressed, The Higher They Will Rebo Posted: 13 Sep 2012 09:06 AM PDT |
| Bonanza Discoveries That Will Drive Gold Stocks: Eric Coffin Posted: 13 Sep 2012 07:46 AM PDT |
| Monetary “Floodgates” And Geopolitical Unrest To Support Precious Metals Posted: 13 Sep 2012 07:38 AM PDT gold.ie |
| Sentinel Ruling And What It Means For Your Street Name Shares Posted: 13 Sep 2012 07:19 AM PDT
from jsmineset.com: My Dear Friends, The Sentinel Ruling is now a legal precedent. In bankruptcy of your bank, broker or fund, you can find your assets in the majority of cases are backing the liabilities of the entity in front of yourselves. This is why you must act to protect yourself. No one in this financial world is going to do it for you, and few will have the courage to recommend you escape Street Name. The Sentinel Ruling is the law and you can wake up one day and find out that your investments are gone. The insurance programs will function as long as the incidents of bankruptcy are isolated events. In a systemic collapse the insurance funds are not capitalized to meet the potential obligations. The guarantor you are relying on will have to be bailed out. Keep on reading @ jsmineset.com |
| German Court Backs ESM Rescue Fund in Double-Edged Ruling Posted: 13 Sep 2012 07:16 AM PDT
from telegraph.co.uk: Markets breathed a sigh of relief across the world after the Constitutional Court in Karlsruhe ruled that the European Stability Mechanism (ESM) and the EU's Fiscal Compact are compatible with the country's Basic Law. The euro surged to a four-month high of €1.29 to the dollar. "This is a good day for Germany and a good day for Europe," said Chancellor Angela Merkel. "Germany is fulfilling its full responsibilities as the biggest economy and a trusted partner in Europe." The European Parliament leapt to its feet in thunderous applause as the news came through, the verdict removing the final hurdle blocking deployment of the €500bn (£397bn) bail-out fund and consummating Europe's grand plan to hold monetary union together. Keep on reading @ telegraph.co.uk |
| ‘Best Climate’ Don Coxe Has Ever Seen For Gold Price Increases Posted: 13 Sep 2012 07:03 AM PDT
from caseyresearch.com: Yesterday in Gold and Silver Well, it was an interesting day on Wednesday. The gold price spiked on the news out of the German courts yesterday morning…but the rally was crushed in minutes by a massive selling orgy by the bullion banks. From that point, the gold price traded more or less sideways until the 8:20 a.m. Comex open…and then the selling pressure began anew. The low for the day [$1,724.30 spot] came around 10:45 a.m. Eastern…and about fifteen minutes before the London close. Keep on reading @ caseyresearch.com |
| The Fed’s Wizard Behind the Curtain Posted: 13 Sep 2012 07:01 AM PDT
from rickackerman.com: Much has been written about The Wonderful Wizard of Oz by L. Frank Baum as an allegory for monetary policy. At the time it was written in the late 1890s, the country had been ravaged by deflation and William Jennings Bryan was running for President on a platform that, among other things, advocated "free silver" or bimetallism as a method of stimulating economic growth. Back then there was no Federal Reserve and we were on the gold standard. The Treasury could increase the amount of official silver coinage as a powerful and unconventional way to juice the money supply. How quaint. According to the scholarly literary criticism, Dorothy represents the "America-honest everyman" , the Kingdom of Oz is Washington D.C. and the Wizard is the President. Dorothy must travel the Yellow Brick Road, signifying gold and have an audience with the Wiz who supposedly has the power to get her back to Kansas. Keep on reading @ rickackerman.com |
| Posted: 13 Sep 2012 07:00 AM PDT
from globaleconomicanalysis.blogspot.ca: A collapse of property schemes, commodity schemes, and other investments schemes in China is well underway. The Ponzi schemes all had one thing in common: they needed an ever-growing pool of suckers to pay the returns promised to investors. Well, the pool of greater fools finally ran out, and Shadow Bankers Vanished Leaving China Victims Seeing Scams Keep on reading @ globaleconomicanalysis.blogspot.ca |
| Global Economic Plunge, Money Creation & Soaring Gold Posted: 13 Sep 2012 06:54 AM PDT
from kingworldnews.com: Today Mish warned King World News that investors should prepare, "… for a big plunge in economic growth worldwide." Mish also said that despite the plunge in the global economy, "I expect to see gold breakout to the upside and I think we are starting to see that right now. The same thing is true for silver." But first, here is what Mish, who runs the Global Economic Analysis site, had to say regarding the plunge in economic activity: "We are seeing a decline in the global economy. China has slowed down dramatically, so any commodity exporters which export to China are slowing down as well. We're already seeing this happen in countries like Australia. We are also starting to see the Australian housing market begin to crash." Keep on reading @ kingworldnews.com |
| VC Inspired Reflections on QE3 Posted: 13 Sep 2012 06:46 AM PDT
In all cases risk management, position sizing (bet sizing) and lumpy / fat tail profit distributions are the norm. In that light venture capitalist Paul Graham, founder of Y Combinator, has an interesting piece out titled Black Swan Farming. Here is an excerpt:
Trading is not quite as extreme in respect to 1000x variations. But the general idea has merit and similar "strange consequences" apply. As documented by Ken Grant, risk manager to many of the top hedge funds in the world, in his book Trading Risk, many top traders develop a 90/10 type return profile over time, meaning 90% of their profits come from 10% of their trades. This does not mean that 9 out of 10 trades are insignificant, only that, in the long run, the opportunity to take a few positive outliers and build them into monsters through controlled risk layering into a big trend is what makes the major killing. Furthermore, as diverse time-frame traders, with the ability to target short, intermediate and longer term returns, we employ a mix of swing trades (with relatively close profit targets and fast exits) and higher conviction trend trades (in which the goal is to hold much longer, for a potentially significant trend, with multiple pyramid points along the way). The higher conviction trades will be far fewer in number, but can have an outlier impact on the portfolio over time because of their huge size when they pay off. The other counter-intuitive thing, as Graham points out, is that you don't know in advance which investments are going to be huge. Similarly, it is hard to know which conviction based trend entries are going to develop into monsters. Many will wind up being scratches or tight controlled losses, because it is hard to distinguish which will be winners beforehand and the embedded uncertainty is part of what creates the opportunity in the first place. Those tight controlled losses wind up being ridiculously worth it, however, because they facilitate the process by which low risk entries develop into payoff profiles that can return 50x or even 500X initial risk. At any rate, this brief sidetrack into the waters of expectation and position management seems especially appropriate on FOMC day, as we wait to hear "QE3 or no QE3″ with significant easing expectations already priced in… In recent trading of the US dollar, stimulus expectations and reigning conventional wisdom – and you know by now we don't think a whole hell of a lot of conventional wisdom! – have combined to create an exploitable environment extreme. Yesterday we tweeted this chart of the US dollar (via UUP):
From a high probability swing perspective we are mostly on the sidelines at moment. But from a potential trend trade perspective, in which tight risk points and inflection point entries can pay off with position profits orders of magnitude larger than initial risk, the dollar's setup (or rather various forex plays counter to it) now look very interesting… the common view of what the Federal Reserve can do, and is able to do, looks very overdone to us. This creates the opportunity for a powerful snapback rally in the $USD and a recalibration to widespread global slowdown conditions, which are becoming more apparent by the day. In the Mercenary Live Feed we put on some light forex positions yesterday that could benefit from a dollar resurgence. We will also consider audible short calls on the major indices today, post-Fed, depending on how the market reacts. Again, our bias to the short side does not reflect a congenital or permanent bearishness here. We agree with Jesse Livermore that "there is only one side to be on in the stock market – not the bull side or the bear side, but the right side." With that said, awareness of odds and probabilities will often wind up situationally favoring one side of the market vs the other, in terms of excellent reward to risk opportunity given certain outcomes. Right now, you have a lot of bullish investors precariously positioned, with "baked in the cake" QE3 expectations and embedded possibility of great disappointment. (Just imagine if Bernanke waits until December, for example… a lower probability outcome but certainly a statistically non-trivial one, with strong "pot odds" implications for upside tail risk exposure in that direction.) You also have multiple Soros style "false trends" (in our estimation) relating to unrealistic dollar weakness expectations vis a vis the rapidly slowing rest of the world. In the Live Feed our general positioning remains light and resolutely bearish, with an increasing interest in short positions that have two ways to win: Via surprise disappointment from the Fed, or via "QE3 delivery as expected" from the Fed that, given existing anticipation, results in a poor / lackluster reaction anyway. JS (jack@mercenarytrader.com)   p.s. Like this article? For more, visit our Knowledge Center! p.p.s. Break the Institutional Barrier - and Substantially Increase Assets Under Management! Access our FREE report to find out how... p.p.s. follow us on Stocktwits & Twitter! @MercenaryJack and @MercenaryMike |
| Monetary 'Floodgates' & Geopolitical Risks Buoy PMs Posted: 13 Sep 2012 05:27 AM PDT Gold is a tad higher today in most major currencies. Investors await the policy decision by the US Federal Reserve and Fed Chairman Ben Bernanke's news conference at 1815 GMT. |
| QE3 Launch 'Could Push Gold Over $1800' Posted: 13 Sep 2012 05:05 AM PDT Wholesale market gold prices traded around $1,730 an ounce Thursday morning in London, a few Dollars below where they started the week, while stock markets ticked lower ahead of today's policy announcement by the US Federal Reserve. |
| How Coal Brought Us Democracy, and Oil Ended It: Lessons from the New Book “Carbon Democracy” Posted: 13 Sep 2012 03:41 AM PDT Matt Stoller is a fellow at the Roosevelt Institute. You can follow him at http://www.twitter.com/matthewstoller Long before politicians mewled helplessly about the power of "Big Oil", carbon-based fuels were shaping our very political, legal, intellectual, and physical structures. It was, for instance, coal miners who brought us the right to vote. Israel's founding had a lot to do with British fears of Palestinian labor unrest in coastal energy complexes. And the European Community was a post-WWII experiment to switch that continent to oil, a task begun before World War I by British conservatives to defeat their domestic political opponents. Glass-Steagall crimped financial flows, partially at the behest of the oil industry. In fact, you can't understand modern democratic or third world political structures without understanding energy, and particularly, coal and oil. That's the contention of Tim Mitchell's new book, Carbon Democracy Political Power in the Age of Oil, a history of the relationship between carbon-based fueling sources and modern political systems. It's a book that tackles a really big subject, in a sweeping but readable fashion, and after reading it, it's hard to imagine thinking about political power the same way again. Everything in our politics flows through dense carbon-based energy sources, and has for three to four hundred years. For instance, the invasion of Iraq in 2003 was a pivotal moment in America's strategic outlook. America, a global hegemon whose empire was weakening, seized the second largest oil deposits in the world as a way of preventing its economic and political decline. Was there any precedent for this kind of action? As it turns out, yes. The last declining global hegemon, Great Britain, also engaged in a brutal and highly controversial British occupation of Iraq, in the 1920s, pressed aggressively by the well-known British conservative, Winston Churchill. Churchill supported this occupation not just because he wanted Iraq's oil, but because he wanted to defeat democratic forces – particularly militant coal miner unions – at home. Churchill and conservative elites running through British history (most recently Margaret Thatcher) understood that as long as the British power grid, and more importantly the military, was dependent on radical coal miners, his left-leaning labor opponents would be able to demand higher wages, social insurance, voting rights, and a share of the economic gains of the British economy. He preferred to have the British economy running on oil, so he sought imperial strategies to ensure access to resources without being reliant on his political opponents. Globally, in fact, the switch from coal to oil was a fight about labor. The use of coal and oil in the context of industrialization has always been about who has the power to profit from the surplus these energy forms produce, but until now, no one has pulled the various historical details together into a historical narrative laying bare the fascinating power dynamics behind the rise of Western political systems and their relationship with energy. Carbon Democracy is an examination of our civilization's 400 hundred year use of carbon-based energy fueling sources, and the political systems that grew up intertwined with them. Rather than presenting energy and democracy as separate things, like a battery and a device, Mitchell discusses the political architecture of the Western world and the developing world as inherently tied to fueling sources. The thesis is that elites have always sought to maximize not the amount of energy they could extract and use, but the profit stream from those energy sources. They struggled to ensure they would be able to burn carbon and profit, without having to rely on the people who extract and burned it for them. Carbon-based fuels thus cannot be understood except in the context of labor, imperialism and democracy. This book is a response to David Yergen's The Prize: The Epic Question for Oil, Money, and Power, a classic story of hardy entrepreneurs taking huge risks to find oil in the most remote places. Yergen's narrative centers on oil scarcity, and its contributions to economic growth in a capitalist framework. Oil is, to Yergen, the prize, solving the key problem of how to supply enough energy for a modern consumer society with a flexible and inexpensive fuel source. In Carbon Democracy, Mitchell has a counterintuitive take on oil, one that after awhile, makes much more sense than what Yergen argues. Mitchell points out that the problem of oil has never, until recently, been that it is a scarce commodity, but that it is a surplus commodity. We had too much of it. And the central problem that this created was now how to find more of it, but how to ensure that oil cartels profiting from high oil prices could make sure that very few new oil finds, especially from the massive fields in the Middle East, came online. Far from a hardy band of entrepreneurs searching for more oil, the story of oil is one of parasitic cartels manipulating governments and inventing concepts like mandates, self-determination, and national security to ensure they could retain high profits selling a widely available commodity. But Mitchell takes the story much deeper than Yergen did, because Yergen's book is fundamentally a fairy tale that skirts over questions of labor and colonialism. Mitchell goes back before the widespread use of oil, to the industrialization of England and England's use of carbon-based fuels, like forests, peat, and coal. Industrialization demanded two seemingly contradictory factors – huge new tracts of land to grow industrial raw materials like cotton and high energy food crops like sugar, and far more centralized urban centers for manufacturing. What happened, of course, is that England simply acquired colonies with large land tracts overseas, using slave labor to harvest necessary commodities, while becoming an urban society in its core areas. Eventually, England began using coal to fuel its economy, leading to substantial economic growth and imperial strength. Coal, though, presented a challenge to the governing elites, since the characteristics of coal, with its labor intensive extraction methods, were quite vulnerable to strikes. Coal was hard to transport, and miners operated underground in a collaborative manner. Once on the surface, coal had to be moved by fixed networks of trains. There were multiple bottlenecks here, and in the late 19th century, for the first time, the energy system of the industrialized world was reliant on workers who could withhold their labor and block a key resource. This translated directly into political power. As Mitchell put it, "Coal miners played a leading role in contesting work regimes and the private powers of employers in the labour activism and political mobilisation of the 1880s and onward. Between 1881 and 1905, coal miners in the United States went on strike at a rate of about three times the average for workers in all major industries, and at double the rate of the next-highest industry, tobacco manufacturing." The coal industry was the key radicalizing force in bringing democracy to the Western world. For instance, in the United States in the 1930s, the radical Congress of Industrial Organizations, which is now the CIO part of the AFL-CIO, was founded by John Lewis, of the militant United Mine Workers. The rise of labor militancy in the coal mines had global political significance. "Between the 1880s and the interwar decades, workers in the industrialised countries of Europe and North America used their new powers over energy flows to acquire or extend the right to vote and, more importantly, the right to form labour unions, to create political organizations, and to take collective action including strikes." World War I, which was the first war fought with opposing armies both using the applied force of a dense carbon-based fuel, was both incredibly bloody and important in terms of bringing strength to labor. Workers had leverage, because they fueled military forces, in particular the British Navy. Welsh coalfields produced steam coal, a type of coal that both packed full of energy and quick to heat, by far the best fuel for battleships. But these miners had been engaged in a wave of strikes and unrest from 1910-1914, which led Winston Churchill, then in charge of the admiralty, to switch the navy to oil. Whereas Britain had very small discovered deposits of oil (large discoveries in the North Sea would come much later), oil had different physical characteristics than coal. It could be drilled, and easily shipped through pipelines and oil tankers, thus rendering it far less vulnerable to labor slowdowns and sabotage. Churchill, in switching away from coal, was in effect trading dependence on Welsh labor and his left-wing political opponents at home for dependence on corporate cartels operating in the Middle East. Not coincidentally, Britain occupied Iraq in a brutal and controversial period during the 1920s, foreshadowing America's later actions in the region. And oil companies operated not to maximize production, but to sabotage it. Mitchell wrote, "The companies had learned from Standard Oil that it was easier to control the means of transportation. Building railways and pipelines required negotiating rights from the government, which typically granted the further right to prevent the establishing of competing lines. After obtaining the rights, the aim was usually to delay construction, but without losing the right. Iraq became the key place to sabotage the production of oil. It would retain that role through much of the twentieth century, and reacquire it in a different way in the twenty-first century." It is here that Carbon Democracy truly shines. Mitchell has reinterpreted the creation of much of our democratic apparatus, from labor laws to minimum wages to the right to vote to resistance to imperialism, as the struggle between different types of carbon-based fuels and the various characteristics of the labor required to extract and use them. Oil and how it flows is modern democracy. Even the creation of modern economics, he shows, the notion of the "economy" itself, is a function of coal and oil. The first massive collections of government statistics, Mitchell points out, were attempts to quantify coal reserves. And in the early 20th century, there were two different conceptions of economics, one by economists like Thorsten Veblen that focused on the scarcity of resources, and the other by those who ultimately became neoclassical and Keynesian, which assumed infinite resources. The latter ended up winning, because the massive surplus of oil allowed for industrial agriculture to solve our food supply issues, and petrochemicals to provide a virtually infinite array of material shapes and sizes for any number of uses. In the 1930s, Keynes essentially invented the concept of the "economy", as a sphere where political choices should not intrude. This created the period of "managed democracy", which lasted until the 1970s. Oil was the fuel sources that created this pseudo-democratic system, which involved strict financial controls to stop oil speculators from driving the price of oil down and crimping oil company profits. Glass-Steagall and the strict financial laws set up in the Depression, as it turns out, had at their core the protection of the oil industry (political scientist Tom Ferguson echoes this interpretation in his work). Similarly, the unraveling of this system because of higher oil demand in the 1970s led the neoliberals to gradually break this system of financial regulation. Flowing through the narrative is the question of imperialism and neo-imperialism. A variety of ideological mechanisms, such as the self-determination ostensibly preached by Woodrow Wilson, were in fact ways for Western oil consuming states to control and slow the flow of oil from poorer but oil rich countries. Mitchell shows how Palestinian strikes at oil installations in the late 1930s led Britain to support a Jewish state in the area, and how American mining engineers helped craft the apartheid regime in South Africa. At the same time, aggressive left-wing parties in the British parliament sought to combat imperialism, because they understood that imperialism abroad was meant to break the power of British labor – in particular coal mining – at home. Mitchell pays particular attention to the negotiations of the Treaty of Versailles and the period of negotiations after World War II to set up an international management framework. The League of Nations, he writes, "was to be an economic mechanism to replace, not war between states, but its taproot – the conflict over material resources." In addition to what would become the World Bank and IMF, Keynes wanted to establish an international body to manage commodities, including and especially oil. While no institution was ever set up to do this, a framework of national security and "the Cold War" managed to keep Middle Eastern and Russian offline for a long period of time. In addition, the oil companies used public relations to encourage a high oil consumption lifestyle in the United States, so as to keep the price of oil as high as possible. In Europe, Mitchell encourages a revised view of the Marshall plan, as a joint European and American elite plan to break European labor power. It's a particularly interesting way to interpret the rise of the European Union, one deeply at odds with thinkers like George Soros who see the EU as a success of far sighted visionaries who sought to to build an "open society". Mitchell cites American intervention in post-WWII European economic and political arrangements as evidence.
Thus, the European Community, which is currently in the thrall of a monetary crisis, was created out of a fierce political battle over oil, coal, profits and labor. And now, with the Cold War over and the European infrastructure dependent on labor-immune oil, the welfare states of the Eurozone are being destroyed. Carbon Democracy, as a historical narrative, explains why this is not a an anomaly. Chucking labor and social insurance overboard is a feature, not a bug, of the European experiment. Only by understanding the relationship of Europe to coal and oil does this become apparent, and can we cast aside quaint notions of democracy that ignore realpolitik. The ultimate conclusion of the book is that a climate crisis, and peak oil, are putting our deeply held political arrangements in a period of uncertainty and crisis. Once you've gone on this journey through time, and you understand Mitchell's narrative that our very intellectual horizons are dominated by oil as a surplus and infinite commodity, it becomes hard to conclude that our cultures will look remotely similar to what they look like today in just a few years. Against this sweeping narrative, our current political debates seem incredibly tiny, almost irrelevant. We have, as it turns out, been living in a land of fairy tales about how our society works, because we've been ignoring what powers it, oil, and what drives that commodity. The pipelines, the wells, the financial channels, these construct our physical society, as well as the intellectual environment in which we conceive of and organize our social relations. I have only one reservation about Mitchell's work. This book utterly blew me away. But because it did, because it sits so far outside of the orthodox sources of information I understand, it's extremely difficult to incorporate it into contemporary political rhetoric. Most of the time, when I read a book on politics, though the information may be new, especially when the book contains a well-reported story, the influences come from a fairly standard set of ideas. For instance, I really loved Neil Barofsky's book Bailout, because it was his observations on working the levers of power in Washington. And though the information in it was new, the book was a response to Tim Geithner's worldview. We are mostly familiar with the various economic and legal ideas to which Barofsky referred, and so we can understand the political implications of what he's saying. The book presented new information, but in a framework that was familiar, an extension of arguments I already understood. Carbon Democracy does not do this. Indeed, it could not. It introduces ideas and concepts that will need new political rhetoric before it can be absorbed by the public and policymakers. These ideas are desperately important, because they persuasively explain why our social arrangements are the way they are. I suspect that those who run our oil companies, and perhaps our banks, would instantly understand what Mitchell is saying, and find it almost obvious. The rest of us, though, will have to wake up from our dreamscape of democracy before truly recognizing what Carbon Democracy has put right in front of us.
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| ‘Best Climate' Don Coxe Has Ever Seen For Gold Price Increases Posted: 13 Sep 2012 03:24 AM PDT ¤ Yesterday in Gold and SilverWell, it was an interesting day on Wednesday. The gold price spiked on the news out of the German courts yesterday morning...but the rally was crushed in minutes by a massive selling orgy by the bullion banks. From that point, the gold price traded more or less sideways until the 8:20 a.m. Comex open...and then the selling pressure began anew. The low for the day [$1,724.30 spot] came around 10:45 a.m. Eastern...and about fifteen minutes before the London close. The gold price made several attempts to rally after that, but every rally, no matter how small, got sold off...and the gold price was carefully closed below Tuesday's closing price. In technical terms, gold had a key reversal to the downside. Gold finished the Wednesday trading session at $1,731.40 spot...down $1.10 from Tuesday. Net volume was an eye-watering 197,000 contracts. "Da Boyz" threw everything they had at the gold price yesterday to prevent it from blowing to the outer edges of the known universe...and the same can be said about the silver price as well.
The silver story for Wednesday was even more egregious. After getting stopped cold at the $34 spot mark for the fourth day in a row, silver got sold down slowly until about 10:20 a.m. in New York. At that point, JPMorgan et al engineered a one dollar waterfall price decline that ended less than twenty minutes later. Silver printed $32.40 spot at its low tick. Then, like gold, silver made several attempts to rally, but got sold off each time...and also had what I consider to be an engineered key reversal to the downside finish to the day. Silver closed the Wednesday trading session in New York at $33.31 spot...down 17 cents from Tuesday's close. Silver's volume was an astounding 73,000 contracts.
For obvious reasons, platinum did very well for itself yesterday, rallying strongly right from the London open. This lasted until just before the 12 o'clock noon lunch hour BST, before a thoughtful seller peeled about one percent off a price that was about to go parabolic. From there it traded sideways for the rest of the day, finishing up a hair over $40 by the close of trading...but would have done better if left to its own devices.
The dollar index opened at 79.90 on Tuesday night...and drifted slowly lower, hitting its nadir of 79.55 at 11:30 a.m. in London yesterday morning. Ninety minutes after the low was set, the index had gained back half its loss...and then traded flat into the 5:30 p.m. New York close. The dollar index closed down about 20 basis points...and at no time was a factor in the shenanigans that went on in the precious metal markets.
The gold shares sold off in sympathy with the price during the first hour or so of trading yesterday...and the low was in around 10:40 a.m. Eastern time. From there, the gold stocks recovered strongly...and were up well over a percent by shortly before 2:00 p.m. Eastern time. Then a thoughtful seller showed up and sold the stocks down about 1.5% in less than fifteen minutes. From there the stocks more or less traded sideways into the close...and the HUI finished up 0.44%.
Considering the pounding that silver took, the shares [for the most part] finished strongly...and Nick Laird's Silver Sentiment Index actually closed up 0.61%.
(Click on image to enlarge) The CME's Daily Delivery Report showed that only 18 silver contracts were posted for delivery on Friday within the Comex-approved depository system. Nothing to see here. Both GLD and SLV showed withdrawals by authorized participants yesterday. There was 119,649 ounces taken out of GLD...and 387,575 troy ounces removed from SLV. Switzerland's Zürcher Kantonalbank provided an update of their gold and silver ETFs as of the close of business on Monday, September 12th. Since August 30th, they added 57,401 troy ounces of gold...and a smallish 2,315 troy ounces of silver. Well, the new short interest numbers were posted over at the shortsqueeze.com Internet site late last night...and the silver number was a big surprise. It also confirmed Ted Butler's worst fear. It showed that during the last two weeks of August, there was a 4.16% decline in SLV's short interest, which now stands at 13,129,800 shares/ounces. During that two week period, the price of silver rose by about $3.50...give or take...and silver should have been pouring into SLV...just like gold was pouring into GLD during the same period. But it wasn't. During that approximate time period, the amount of silver in SLV actually declined by several million ounces. When the authorized participants don't have the metal to add to SLV, they short the shares in lieu of that until they're in a position to deliver the metal. Then they reverse that transaction. Not only did the authorized participants not add metal, they didn't short the shares in lieu of, either...as the SLV short position declined over that 2-week reporting period, when it should have risen substantially. So what the #%@& is going on? All I can tell you is that Ted Butler, in his September 5th commentary to his paying subscribers, mentioned the fact that..."The short position on stocks come from a source that I'm uncomfortable with...the Depository Trust Clearing Corporation...or the DTCC." Did JPMorgan whisper in their ear? If that's the case, we've sunk to a new low in the silver price management scheme. Without doubt, I'm sure that he'll be writing about that very thing in his special commentary later today. Not that I want to second guess what Ted might do, but it's my opinion that whatever he writes on this issue, will be posted in the public domain in short order. GLD's short position declined by 18.95% which, considering the huge rally in the gold price...combined with the large amount of gold that poured into the fund during that 2-week period, is no surprise to me...and was expected. GLD's short position now stands at 14,970,500 shares, or 1.50 million ounces...46.56 tonnes. There was no sales report from the U.S. Mint. Over at the Comex-approved depositories on Tuesday, they reported receiving 841,080 troy ounces of silver...and shipped 331,479 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 afternoon...and it doesn't require any further embellishment from me. As I said back in February of 2007...call me in 2013 and we'll talk about a bottom in the U.S. residential real estate market.
Despite my best efforts, I have the usual number of stories for you today...and I hope you can find the time to read the ones that interest you. There was nothing free-market about that 20-minute engineered price decline in silver yesterday morning, either. Ray Dalio: There's No Sensible Reason To Not Own Gold. Is a short squeeze in silver imminent? Platinum Soars As Spreading South African Miner Strike Cripples World's Biggest Platinum Firm. ¤ Critical ReadsSubscribeRich-Poor Gap Widens to Most Since 1967 as Income FallsThe income gap between rich and poor Americans grew to the widest in more than 40 years in 2011 as the poverty rate remained at almost a two-decade high. The U.S. Census Bureau released figures yesterday that showed median household income fell, underscoring a sputtering economic recovery and struggling middle-class that are at the center of the presidential campaign. The proportion of people living in poverty was 15 percent in 2011, little changed from 15.1 percent in 2010, while median household income dropped 1.5 percent. The 46.2 million people living in poverty remained at the highest level in the 53 years since the Census Bureau has been collecting that statistic. Today's first story was posted on the Bloomberg Internet site early yesterday afternoon Eastern time...and I thank Manitoba reader Ulrike Marx for sending it. The link is here.  Sentinel ruling may hurt MF Global clientsA ruling in the case of failed futures brokerage Sentinel Management Group could make it more difficult for customers to recoup money lost in the much larger collapse of MF Global, according to Sentinel's bankruptcy trustee. A federal appeals court on Thursday upheld a ruling that puts Bank of New York Mellon ahead of former customers of Sentinel in the line of those seeking the return of money lost in the 2007 failure of the suburban Chicago-based futures broker. The appeals court affirmed an earlier district court ruling that the bank had a "secured position" on a $312 million loan it gave to Sentinel, which turned out to have been secured by customer money. Futures brokers are required to keep customers' funds in dedicated accounts to protect them from being used for anything other than client business. This Reuters story was posted on their website this past Sunday...and I thank Roy Stephens for digging it up on our behalf. It's a short read...and the link is here.  Former Banker Promises Inside Peek at Goldman SachsWall Street has plenty of worries heading into autumn: the stability of the euro zone, persistent United States unemployment and the historically volatile October stock market...and Goldman Sachs has an additional concern: Greg Smith's book. Mr. Smith's memoir, "Why I Left Goldman Sachs," is set for publication on Oct. 22. The release date comes just seven months after Mr. Smith publicly resigned from the bank with an Op-Ed page article in The New York Times that detailed his disappointment with Goldman's business practices that reflected, more broadly, a corrosive culture at the nation's largest banks. The article struck a nerve. Within 24 hours, it had more than three million views online. Publishers clamored for the rights to a book. Grand Central Publishing, a division of the Hachette Book Group, secured a deal, offering Mr. Smith an advance of close to $1.5 million, according to people with direct knowledge of the negotiations. Its depiction as a blood sucking "vampire squid" in a Rolling Stone article captured the public's imagination, helping to make Goldman a symbol of Wall Street's dark side. I would suggest that Mr. Smith's book will do rather well...and it wouldn't surprise me one bit if Matt Taibbi wrote the introduction. If he didn't do that, I'm sure he'll have something to say about it when it does hit the book stores. This story appeared on The New York Times website early yesterday afternoon as well...and I thank Washington state reader S.A. for bringing it to our attention. The link is here.  Whistle-Blower Awarded $104 Million by I.R.S.Bradley C. Birkenfeld, a former banker at UBS, recently served two and a half years in prison for conspiring with a wealthy California developer to evade United States income taxes. But Mr. Birkenfeld, 47, has a lot to show for his time and effort: The Internal Revenue Service acknowledged on Tuesday that information he had provided was so helpful that he would receive a $104 million whistle-blower award for revealing the secrets of the Swiss banking system. By divulging the schemes that UBS used to encourage American citizens to dodge their taxes, Mr. Birkenfeld led to an investigation that has greatly diminished Switzerland's status as a secret haven for American tax cheats and allowed the Treasury to recover billions in unpaid taxes. For all U.S. citizens with something to hide from the taxman...this falls into the must read category. It was posted over at the nytimes.com Internet site on Tuesday...and I thank Donald Sinclair for sending it. The link is here.  G. Edward Griffin on Saving the US from TotalitarianismG. Edward Griffin works tirelessly to dispel the notion that the Fed has been a failure. His latest effort was at the just-concluded Casey Research/Sprott Inc. investor summit on Navigating the Politicized Economy, where he told a packed hall that the Fed has been wildly successful at its true mission - to protect the banking system at all costs. According to Griffin, the problem is the American people are footing the bill for these costs through stealth taxation, thanks to the coordinated actions of the Fed and US government. If you haven't read Ed Griffin's book "The Creature From Jekyll Island: A Second Look at the Federal Reserve"...you should consider yourself uneducated. If I had to pick one book that changed my life forever...this would be the one. You owe it to you, to read it. The link to this 25:50 minute video interview with Ed Griffin is imbedded in yesterday's edition of Conversations with Casey...and is linked here...and is a must watch for sure.  Green Light for ESM: German High Court OKs Permanent Bailout Fund with ReservationsIn a historically significant signal for the euro rescue, the German Federal Constitutional Court on Wednesday ruled there are no grounds to stop the country from ratifying the European Stability Mechanism, the permanent euro bailout fund, and the fiscal pact aimed at bringing economic governance to countries in the euro zone. The decision bolstered stock markets in Europe and around the world and also strengthened the euro. However, the justices at the Karslruhe-based court also expressed some reservations. The court ordered that ratification can only be completed if it is ensured under international law that Germany's current maximum liability of €190 billion ($245 billion) can only be increased with the approval of the German representative in the ESM board, court President Andreas Vosskuhle said. "(No) provision of this treaty may be interpreted in a way that establishes higher payment obligations for the Federal Republic of Germany without the agreement of the German representative," the court states. This also means that Germany's federal parliament, the Bundestag, must play the leading role in important decisions. Under a German law accompanying the ratification of the ESM treaty, the German parliament must first vote on the positions taken by the German representative in the ESM board before they can act on them. However, it is still unclear at this point whether decisions will require a vote of the full parliament or the significantly smaller budget committee. This is the first of two stories that I have on this topic. The first is from the German website spiegel.de early yesterday morning...and I thank Ulrike Marx for sending it. The link is here.  |
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