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- Which Drivers Made Of China The World’s Largest Gold Market?
- Gold Investors Weekly Review – April 25th
- Prospects For Gold And Silver Prices From A Russian Point Of View
- Are You an Elitist? Class Warfare and the New Nobility
- Gold-Futures Selloff Wanes
- STOCKS BUBBLE PHASE: GOLD CAPITULATION FOLLOW UP
- Avnel Gold Still Has A Lot Of Room To Run
- THE BLUEPRINT TO ENDING THE FED!
- The Blueprint to Ending the Fed!
- Is The Status Quo Dollar Negative?
- Lawrence Williams: Two-Faced Goldman Appears to Hedge Bets on Gold Stocks and Bullion
- The Dollar Under Siege: Bud Conrad---Casey Research
- Three King World News Blogs
- Bank of Nova Scotia to get visit from British watchdog as scrutiny of London gold fixing grows, sources say
- Will regulators and journalists ever dare to look behind the London gold fix banks?
- U.S. Exports a Record Amount of Gold to Hong Kong in January
- U.S. suits hobble Deutsche Bank's bid to sell gold fix seat
- Sunken Gold Untouched for 157 Years Off U.S. Lures Hunter
- Canadian bank CIBC starts selling real gold, not just paper
- Safe Deposit Boxes Are Not Safe for Silver and Gold Buyers
- Peter Schiff: Reckless Fed may push gold to $5,000
- Two-faced Goldman appears to hedge bets on gold stocks and bullion
- Imagine how much more disease might be eradicated by a free-market gold price
- Novartis: Will Restructuring Prove Fruitful For The Company?
- Reader Question on Shadow Banking and Gold Buying in China
- Black Monday looms for financial markets as Ukraine crisis hots up and more sanctions look inevitable
- Regulators scrutinize London gold fix
- Gold bears punish the miners - charting the damage
- Steve St. Angelo: U.S. gold exports to Hong Kong explode to record in January
- april 25.2014/No change in gold inventory at GLD/ No change in silver inventory at SLV/ gold goes deeper into backwardation for 6 months and very close to backwardation one year out/gold and silver rise/
- Gold Daily and Silver Weekly Charts - Madness, Ending Badly
- Imagine how much more disease might be eradicated by a free-market gold price
- Gold Bounces Back Above $1,300 as Ukraine Crisis Escalates
- How Gold & Mining Companies Will Respond to the Coming Big Reset
- Video Market Update (15 mins)
- Meet The New Boss
- Controversial post: 2014 is turning out to be "eerily similar" to 2007
| Which Drivers Made Of China The World’s Largest Gold Market? Posted: 26 Apr 2014 12:31 PM PDT China has become the world’s largest gold market recently. India, who used to have the largest gold market, was burned by its own government imposing more than 20 restrictions in a matter of 2 years. China's private-sector demand for gold in 2013 reached a record level of 1,132 tonnes. The World Gold Council (WGC) predicts gold demand growing 20 percent by 2017. China is becoming an economic powerhouse, a real magnet of wealth. No wonder that gold is flowing to China, as gold flows to the places where wealth is created.
In this article, Frank Holmes from USFunds.com explains the drivers behind the Chinese gold market, and how China established to become the world’s largest gold market. In sum, he says that consumer demand has exploded because the purchasing power of the middle class has increased, that industrial demand has gone up as well, while the central bank has exchanged much of its dollar into gold. From USFunds.com: Driver 1: Jewelry is still the top demand driver The WGC report also reaffirms the ongoing power of the Love Trade. The Love Trade, one of the two main drivers of gold along with the Fear Trade, relates to the cultural affinity for the precious metal particularly in Asia, India and the Middle East. Consumers continue to purchase gold jewelry and coins year-after-year, and demand rises in synch with gift giving for religious holidays and celebrations. As you can see in the chart below, since 2004 the volume of gold jewelry consumed in China has tripled. What's more, China surpassed India as the world's largest consumer and manufacturer of jewelry in 2013. According to a recent Reuters' article, gold jewelry sales in India slowed by 10 percent since import restrictions were imposed on the country last year – a likely factor placing China in the top spot.  China Jewelry consumption from 2004 till 2014 Driver 2: A new middle class has more money to spend The WGC points out in its recent report that only in the last several years has China seen an emerging middle class supported by higher incomes. Until around 2006 for example, Shenzhen, where 70 percent of the country's jewelry is fabricated, only had 330,000 residents. This means that 30 years ago, China's jewelry market and consumer demand for gold, was minimal at best. Over the last 10 years however, a new middle class has emerged and consumers have been enjoying their new wealth. As GDP began to rise, people started buying more gold jewelry and coins. In addition to increased spending on these items, the investment demand for the yellow metal progressed as the population sought a hedge against inflation. Driver 3: Industrial demand is increasingly important Though not nearly as strong as the gold jewelry demand in China, the country's rise in GDP has also increased industrial demand for gold. The WGC says that electronics are the dominant source of this industrial demand. Gold is used in cellphones, computers, circuit boards and recently the automobile industry has seen an increased demand for the metal. Gold may seem like an expensive option to choose from to build cellphone parts or airbag connectors in vehicles, but as the report states, "Although manufacturers are always trying to reduce the cost of components and substitute gold with lower cost alternatives, this cannot be done where optimum performance and, especially, safety concerns are to the fore." In our slideshow, The Many Uses of Gold, we explain other ways gold is used; not only for industrial needs, but for medical and technological advances as well. Driver 4: China is diversifying away from the U.S. dollar When it comes to foreign exchange reserves, China's totalled $3.8 trillion U.S. dollars in 2013, a sharp increase from the mid-90s as you can see in the chart below. There are several challenges facing the Asian nation's monetary system too; the multi-currency system which includes the renminbi, yuan and the dollar is no easy task to manage. But how are China's foreign exchange reserves and monetary troubles a driver for gold demand?  China: gold reserves vs foreign exchanges reserves from 1994 till 2014 For starters, according to the WGC, the majority of growth in China's reserves (implied specifically by the country's current account surplus) has been in U.S. dollars. China used the dollar to buy American debt securities, but upon the global financial crisis and the start of quantitative easing (QE), China has been pulling away from exposure to the dollar. In a recent article from Casey Research, Chief Economist Bud Conrad even comments on the decline of the dollar's reserve status in foreign countries such as China. He says, "In 2000, the dollar accounted for 55 percent of all foreign exchange reserves. In 14 short years, that number has dropped to 33 percent. By 2020, I project, it will drop to 20 percent. At that point, other large economies of the world won't need dollars nearly as much for international trade." I believe that government policy is a precursor to change, so as fiscal and geopolitical challenges rise between the two countries, it's no wonder China wants to back away from the dollar and thus, diversify to gold. Gold is a hard asset, making it a prime currency choice for China. In regards to gold, the WGC report even states that, "It cannot be created out of thin air at the whim of central banks. Nor can it be manipulated for the benefit of its issuer." So what is China up to now? So perhaps the People's Bank of China is amping up its gold reserves to diversify away from the U.S., but one question remains. Exactly how much gold does China have? No matter the exact amount of gold that China has, this country is a good example that the demand drivers for gold remained the same. People around the world react with concern over government policies that can devalue currencies, thus making gold attractive. Similarly, as economies flourish and people have money, they will spend it on gold. The Love Trade will also continue; consumers will purchase gold as gifts as long as cultural celebrations and religious traditions carry on. It's important to follow the money, or in this case the gold, to see how people around the world react to this rare commodity. Looking forward, stay curious as an investor and you'll see if China can keep the key to the gold market. |
| Gold Investors Weekly Review – April 25th Posted: 26 Apr 2014 11:57 AM PDT In his weekly market review, Frank Holmes of the USFunds.com nicely summarizes for gold investors this week's strengths, weaknesses, opportunities and threats in the gold market. Gold closed the week at $1,302.54, up $7.01 per ounce (0.54%). The NYSE Arca Gold Miners Index rose 3.26% on the week. This was the gold investors review of past week. Gold Market StrengthsSigns that inflation has likely bottomed are now showing up everywhere and should stoke inflation expectations in support of gold. The Federal Reserve's M2 money supply growth is running at an annualized rate of 8 percent, a multiple of gold's long-term supply growth of around 2 percent, annually. Similarly, U.S. bank loans have accelerated to levels not seen since 2007, with commercial and industrial loans rising at a 16.1 percent rate over the past 18 weeks. Similarly, average hourly earnings for American workers now run consistently above a 2 percent annual growth rate.  US Money Supply M2 in 2014 Gold rebounded towards the end of the week to $1,302.54 per ounce, as conflicts in Ukraine continue and traders bet that prices will rise amid quickening inflation. Gold sales in Japan more than doubled in the first quarter, ahead of the consumption tax hike that is expected to fuel inflation. Platinum also posted strong performance this week as companies and labor unions in South Africa failed to reach a deal that would end a 13-week-long strike. Gold Market WeaknessesTurkey and Russia both cut gold holdings in March after increases during the previous month, according to data from the International Monetary Fund (IMF). Bullion holdings by central banks are closely watched since the group became net buyers in 2010, after two decades as net sellers. This selling highlights gold's role as a backstop in times of crisis, with Russia likely swapping gold for foreign currency amid the threat of western sanctions. Gold ETF investors have been sellers in April, as monthly outflows reach 516,000 ounces. Outflow days have outnumbered inflow days by a 2:1 ratio. According to UBS, this trading action contrasts with buying during February and March of 261,000 and 463,000 ounces, respectively. On the positive side, April selling is just shy of the inflows recorded in the prior two months, leading UBS analysts to believe the bulk of the selling is now done. Gold Market OpportunitiesRBC analysts upgraded Agnico Eagle to "outperform" following the pullback from the combined bid offer for Osisko. The analysts argue that in addition to the overall transaction being accretive to Agnico, the company deserves a premium over its peers. They note its strong 13-percent annual growth profile, its highly diversified and high-quality asset portfolio, along with its ability to generate substantial free cash flow at current prices. On a related note, Solitario Exploration and Royalty engaged SRK to complete a Technical Resource Report on its Bongara Zinc project in Peru. The Bongara deposit is undergoing an advanced technical evaluation by Votorantim, the Brazilian conglomerate, which will carry Solitario to production upon a positive Feasibility Study. A study of gold forward rates and the investment cycle, signals that gold is at a major multi-year low, according to Ian Williams, CEO of Charteris Treasury Portfolio Managers. Williams asserts that inventories are falling rapidly at a time when replacement cost is $1,500 an ounce. In such an environment, it is clearly not possible for gold to trade below replacement cost for very long. Not surprisingly, the U.K.'s Financial Conduct Authority is considering adding bullion to its list of eligible investments for investors saving up for retirement. This move could give a boost to institutional and retail gold demand. Gold Market ThreatsGold fell to a 10-week low before recovering mid-week, as markets were concerned that a weaker Chinese yuan may force supply out of China. The weakness in the Asian currency mounted concerns that investors would be forced to unwind the 1,000 tonnes of the metal allegedly pledged as collateral for loans. However, the assumption that 1,000 tonnes are at risk of liquidation is likely overstated. A large portion likely ended up in the vaults of the central bank, with many more tonnes locked in commercial bank's balance sheets under consumer gold-accumulation plans. China added Beijing as its third mainland gold import point, in a move that would help keep purchases secret if China (the world's top buyer) opted to boost its official reserves. China does not release its gold trade data, leaving Hong Kong's net export data to Shenzhen as the only reliable indicator of Chinese gold imports. The new import channel will aid China in increasing its gold purchases in a discreet manner, but may also relieve some of the pressure seen in Hong Kong as it funneled gold to satisfy China's strong consumer demand. |
| Prospects For Gold And Silver Prices From A Russian Point Of View Posted: 26 Apr 2014 11:49 AM PDT One of the biggest problems for the West, the US in particular, is its increasingly parochial perspective from the narrowest of lenses, fully colored by the elite's use of its main propaganda machine, the Maintstream Media. It will not work for people to expect more from their government, rather, people have to demand and expect more from themselves, for in the end, people will discover all they really had to rely upon was themselves and failed to do so. All of the information one needs to make more enlightened decisions is out there. One has to change their broken habits of spoon-fed expectations from local news and take a more active role in seeking the truth. In a nation that relies upon a police state, increased militarization, and NSA [STASI] spying on its docile population, one cannot expect to hear truth, only lies, and the Obama administration is certainly delivering them. Ask yourself, what is your impression of Russia, of Putin? Then, consider the following information about both. Never in the history of the world have [mostly] Western central bankers issued anything but worthless paper currency, backed by nothing, controlled by unelected bureaucrats, and none beholding to nor responsible for citizens of a nation, your neighbors and everyone you may know. This is the world in which most of you live without challenging it. Others, outside of the Western sphere of central banks, with a firm grip on their respective governments, refuse to remain a victim of the West's inflationary degradation via fiat currencies and the rot-from-within they generates. Who has been the champion prodder of the Ukrainian situation? The United States, led by its teleprompter-reading corporate president, Barack Obama. What has he done? Threatened economic sanctions, provided neo-Nazi thugs to continue to stir unrest, steal, or remove, if you prefer, all the Ukrainian gold in the middle of the night, and drain the country of billions of dollars, transferred to Swiss banks. Are any of these moves in the least bit constructive, let alone justifiable? Putin's response? Aggression to match aggression? No. Just patience, waiting as events that are doomed to fail play out. While Obama does what he can to stir up a hornets nest in an area of the world the US has no business in interfering, Putin is allowing Obama to take as much political rope as he needs to hang himself. In the meantime, Putin is busy putting together deals with other countries, and its natural gas deal with China in the works will be a game-changer for Russia. All of the deals made and those in process will bring income to Russia as a nation. What kind of income? More rubles, some yuan, maybe even some gold. Totally absent is the use of the dollar as the disappearing world reserve currency. Putin is taking his job of running a country seriously and responsibly. Putin spurns Western central banks and continues to strengthen the ruble. He makes deals with other natural resource-rich countries. Obama invades oil-rich countries. While Obama pushes for war on the other side of the world with Syria and Ukraine, Putin is busy making deals on the other side of his world with Obama's ignored neighbors, Mexico and Latin America. While Obama allows the Fed and Wall Street to continually suppress and disparage the gold market, Putin is building Russia's gold reserves. No fiat ruble over there. What has Obama done to help strengthen the US financially? Nil, and to the contrary, he has increased government spending, with no means of ever repaying it, and he has worsened the plight of millions and millions of Americans through his enrich-insurance- companies scheme at the expense of leaving people without affordable insurance coverage. Most Americans have never heard of Russia's Gazprom, yet it dwarfs Exxon and Mobil in size. In anticipation of Western sanctions, Gazprom secured natural gas deals with China. If Gazprom never sold another energy unit of natural gas to the West, its bottom line will continue thrive with its natural gas sold to the East. Further, Gazprom will now only sell their product using rubles, yuan, and gold, no petrodollars allowed. The Russian banking system has responded to the West's petty and of no-effect sanctions by raising a one-finger salute to the West. Russian banks have stopped using the dollar and have adapted total reliance upon its own ruble, intent on having the ruble become a part of any new global currency. US banks continue to entrap citizens with debt-forever fiat. Russia has the second largest gold reserve in the world. US is the highest debtor nation in the entire world. The US has always had a fondness for being number 1 in everything. The fact that Russia has rejected the dollar in every way, coupled with another fact that it will only transact its gas and oil trade in the ruble will have an impact on the US and the West more than any sanctions Obama can ever hope to [under]achieve. As a consequence of pushing Russia away from the [totally failed] Western banking system, the US stands to lose trillions of fiat $ in return. It is not just Russia. All of the other BRICS nations are following suit. The US and the central banking system is committing seppuku, [hari kari], financial [self-imposed] disembowelment. Still think of Russia as an "evil empire?" Here is a quote from one of Russia's members of Parliament on the US and its fiat: "The dollar is evil. It is a dirty green paper stained with blood of hundreds of thousands of civilian citizens of Japan, Serbia, Afghanistan, Iraq, Syria, Libya, Korea, and Vietnam. Our national industrial giants will not suffer any losses if they choose to make contracts in Rubles or other alternative currencies. Russia will benefit from that. We should act paradoxically when we deal with the West. We will sell Rubles to consumers of our oil & gas, and later we will exchange Rubles for Gold. If they do not like this, let them not do this and freeze to death. Before they adjust, and this will take them three of four years, we will collect tremendous quantities of Gold. Russian companies will at last become nationally oriented and stop crediting the economy of the United States that is openly hostile to Russia." Source: Izvestia newspaper What of he US ally Germany? Guess where Germany will turn when push comes to shove? East! It has vastly important financial ties with Russia. Germany's ties to the US? Mostly fiat and highly objectionable NSA tentacles covering the country. Israel. Surely the staunchest US ally? Well, it turns out that the US worsening of events in Ukraine are a threat to Israeli security. Israel has its own floating Tamar natural gas platform, and it has made a deal with Gazprom to export the liquified natural gas. How much of any of this has anyone read or heard about from government-controlled mainstream media? Not a peep, not a sentence. The elites want US citizens to remain dumbed down, and US citizens are complying in utter ignorance and steadfast refusal to consider any alternative news sources. Reliance upon the total control over the corporate and bankrupt federal government's newspeak is the elite's goal. At the outset, we said people need to expect more from themselves and take more responsibility for their own lives. Reliance upon any government is a trap from which there is no escape. We have not even covered all that can be covered re Russia and Putin, or Obama and the federal government, for that matter. We have not even touched China, India, the growing BRICS nations as a power unto themselves, totally outside of and separate from the self- toppling United Sates. The acronym BRICS brings to mind the story of the Three Little Pigs, making houses of straw and twigs that failed, [fiat], with the safest being the one built of brick. The BRICS are using a lot of gold in building their financial ties together. None of this addresses timing, but the message is clear: financial integrity and strength is relying upon gold, in some large degree, as a standard, at least indirectly. The message should be the same for us all who endeavor to withstand the inevitable fall-out from fiat currencies destroying the Western financial system. The East, parts of the Middle East, and even Central and South American countries are accumulating gold. There is no concern about gold going lower or even not going higher, for now. The end-game is not the short-term price, it is for where gold will seek its natural price level once freed from Western central bankers and to not be caught holding nothing but value-lost paper. On a side note, the elites are not stupid. It is likely that they may even be orchestrating the demise of the Federal Reserve Note "dollar." The direction may have been intended to replace the "dollar" with another fiat issue, like an SDR, [Special Drawing Rights], to be issued by an all-controlling, non-elected or representative government, like the BIS, [Bank for International Settlements], or some similar elite organization. What was not anticipated, during all the decades of planning, was the rise of the East and the use of gold as a measure of currency control. Last week could have been an important anchor for a turning point in gold and silver. The comments on the weekly chart cover a lot of ground. What can be added are the observations labeled 4 and 5. Both are directed at the level of volume. The area marked 4 shows increased volume as price rallied. On the current correction, volume has dropped off. This tells us that the selling pressure is not there, as it used to be. The gold price is also respecting, albeit loosely, the half-way correction area between the recent swing low and swing high. In somewhat of a down market condition, that is a good showing. Gold's failure to decline to the lower channel line is an indication of strength.
The daily gold chart is confirming observation made on the weekly, but with more detail. What was not covered in the chart comments was the thin line at the half-way measure of the down sloping channel. Whenever price can hold the half-way point of anything, it is taken as a relative measure of strength
Silver is a test of one's patience. All purchases made at current, even slightly higher, prices will be viewed as gifts and wise moves sometime in the future, be it later this year or into 2015/2016. When silver finally does rally away from its [very constructive] support zone, purchases made at any higher price in the past few years will look like bargains. The way the charts are setting up, even purchases in the paper futures market now have a diminished downside. What cannot be known is when a move to the upside will make any such buys worthwhile from a profit perspective.
That high volume spike should loom as important, moving forward. As with gold, it may be an anchor for establishing the low point for silver, too. Similar to gold, silver has kept just above the half-way area in its down channel. In this last correction, silver did not even come close to reaching the lower channel live, as it did in late March. Last week's close has it bumping up against the upper channel line very soon after the last challenge just two weeks ago. This is a positive development within a negative down trend. On an ending note, last week, mention was made of Gann and the Cardinal Grand Cross, an astrological significant time frame. It all ends with a solar eclipse on the 29th. [See Gann, Cardinal Grand Cross, A Mousetrap And Wrong Expectations, if you did not read it.] It is just interesting to see how both gold and silver can be potentially bottoming at the same time. From our unwavering point of view, price and volume remain the most reliable guides and source of market information.
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| Are You an Elitist? Class Warfare and the New Nobility Posted: 26 Apr 2014 10:35 AM PDT Class warfare reflects a dysfunctional divide-and-conquer society. One of the easiest ways to put someone on the defensive in America is to accuse him/her of being an elitist. The power of this accusation derives from a complex mix of dynamics. At least one goes all the way back to the founding principles of the nation: a profound and abiding distrust of monarchy and landed nobility, and a well-grounded fear that democracy could be subverted and a new form of feudal monarchy returned to power. It is increasingly clear that a new form of feudalism has indeed subverted democracy, and that the New Feudalism is powered by concentrations of private wealth and centralized state control: what I call the New Nobility.
Recall my Feudalism Corollary #1:
This is why politicians bred in the hothouses of elite universities must perform “I’m one of you” rituals such as publicly enjoying low-brow snack food and attending mid-brow music performances. That such transparent immunizations against charges of elitism still work is testament to the credulity of a media-soaked populace. There is an uglier aspect to the accusatory power of charges of elitism: as the sense that hard work and integrity are no longer guarantees of upward mobility in America, a corrosive class envy is coming to a boil. This is the subtext of the emergent topic of the day, wealth and income inequality. Since the vast majority of us cannot lash out in any satisfying way at the top .01% who own most of the wealth and control the political machinery–in other words, the New Nobility–we seek some other accessible target. Expressing anger at the representatives of authority–police, Homeland Security, etc.–is a risky proposition, as being beaten and hauled off to jail or being shot are distinct possibilities. Beyond the overwhelming use of raw force, authorities maintain an arsenal of soft weapons such as false public accusations, vague legal charges that keep morphing as the accused demolishes each specific charge, IRS audits, and so on. This rage at the dominance of essentially feudal elites and their armies of underlings willing to enforce their rule is increasingly being directed at the elected toadies and lackeys. In response, craven politicos are restricting their exposure to angry serfs. That leaves the top 10% as the only accessible target for class envy and the generalized rage of a peasantry that cannot identify the causes of their servitude.This is misdirection, of course; the top 10% of professionals and technocrats have benefited within the New Feudalism, but they are functionaries, not the New Nobility. It’s clear that the top 10%–the class of technocrats, professionals, entrepreneurs and creatives–has managed to increase their wealth despite the dominance of the top .01%, whose wealth and power has pulled away from the top 10% and even the top 1%.
The Richest Rich Are in a Class by Themselves: top .01% and top .1% The top 5% has done marginally better than the top 10%, and the top 20% have done better than the bottom 80%:
A household income of around $150,000 a year qualifies as a top 10% income: $105,000 to $109,999: 81.09% $145,000 to $149,999: 90.20% $190,000 to $194,999: 95.21% Because the super-wealthy are in the top 5% and top 1%, the average incomes of these groups are heavily skewed by the enormous incomes of the top 01%. As a result, it would be more accurate to remove the top .1% from the top 10%, top 5% and top 1%, but I haven’t found any statistical charts that reflect this. For their part, the top 10%/5% are feeling unfairly targeted by this class envy, as they pay the vast majority of income taxes: CBO:Top 40% Paid 106.2% of Income Taxes; Bottom 40% Paid -9.1% The Distribution of Household Income and Federal Taxes While inherited wealth plays a part in the top .1%, most of the top 10%/5% have earned their wealth the old-fashioned way, by obtaining professional degrees or starting businesses, and by being married/having two incomes: Explaining income inequality by household demographics. Rather than being “the enemy,” the top 10% feels they’re the good guys, the ones providing jobs and paying most of the taxes that support the bottom 40%. While the bottom 90% focuses on their own set of resentments, the top 10% have their own resentments: the public services they pay for are often marginal or poor quality. This reality is fueling a movement of wealthier communities to incorporate into new cities that are operated for the benefit of their residents: services are run more like businesses than spoils systems (the default model of large urban cities), taxes are kept low and feedback from taxpayers keeps service quality high. I have covered the various class fault lines emerging in America many times: The Three-and-a-Half Class Society (October 22, 2012) The New Feudalism a partnership of the Tyranny of the Majority, entrenched incumbents and the top .1% Elites. If the political Status Quo alienates the majority by making them pay more taxes, they risk losing power in the next election. If they alienate the top .1% who fund their multi-million-dollar campaigns, then they will also lose power. So they heap the tax burden on what remains of the middle class. There is a social dimension to this emerging class warfare, a topic I discuss in Bifurcation Nation (June 24, 2013). The top 20% is characterized not just by wealth but by a set of cultural behaviors, values and norms that are increasingly divergent from the norms and behaviors of the bottom 80%. The haves are married, have college degrees, rarely have military service, attend religious services, and have little contact with those outside their own upper-middle class. The have-nots are divorced/single parents, less educated, more likely to have served in the military, less likely to attend church, and earn much less than the haves. I myself am routinely accused of being elitist, on the grounds that few can afford the meals I present here. I have repeatedly proven this assertion to be absolutely false, as home-cooked meals are cheaper than fast-food “value meals” or packaged convenience food. America’s Excuse Book: Take Your Choice, Victim or Heartless Hypocrite (December 2, 2013) These accusations are especially irksome because I have been low-income for most of my adult life and have carried far too much lumber on far too many jobsites to tolerate any accusations of elitism. I suspect many others routinely accused of elitism feel the same way. The urge to accuse everyone with something better than you have of being part of an exploitive elite reflects not just generalized rage but the victory of victimhood. Sadly, one of the few ways for the marginalized in our society and economy to “get ahead” is to make claims of victimhood to secure disability, social services, etc. The core of victimhood is “it’s not my fault.” The system rewards victimhood, so it’s no surprise that has become a dominant social norm. And where does this set of norms lead us? To a dysfunctional divide-and-conquer society in which the top 10% paying most of the taxes is increasingly resentful of the .1% New Nobility above them and the masses below that look at the 10% as the only accessible target of their generalized anger at the injustice of their servitude and powerlessness. The top .1% New Nobility, which of course includes all the craven politicos in thrall to the super-wealthy, have the means to sequester themselves away in gated estates and private jets. No wonder the top 10% is actively pursuing whatever means are available to avoid the resentments of those below. Meanwhile, those running the mainstream media and the machinery of governance have to generate targets for the generalized rage other than the actual sources of dysfunction: the centralized state itself and the private concentrations of capital that partner with the state’s elites in the New Nobility. Want to give an enduringly practical graduation gift? Then give my new book Get a Job, Build a Real Career and Defy a Bewildering Economy, a mere $9.95 for the Kindle ebook edition and $17.76 for the print edition. |
| Posted: 26 Apr 2014 10:00 AM PDT
 Gold's sharp sell-offs since mid-March have been mostly driven by American futures speculators' heavy selling. These traders dramatically slashed their long bets on gold while ramping up their shorts. The resulting deluge of supply flooded the market and temporarily overwhelmed demand. But intense bouts of gold-futures selling quickly burn themselves out, and today's is waning. [...] The post Gold-Futures Selloff Wanes appeared first on Silver Doctors. |
| STOCKS BUBBLE PHASE: GOLD CAPITULATION FOLLOW UP Posted: 26 Apr 2014 09:39 AM PDT At the beginning of the month I theorized that stocks were about to enter a final bubble phase, and that during that process gold should deliver a capitulation phase to end the three year bear market. This is a follow-up to see how things are playing out now that we have another months worth of price action behind us. For stocks it still remains to be seen whether or not they have one more surge higher into a final top. If one just looks at the NASDAQ it would appear that stocks have begun moving down into a bear market. However as I pointed out in my previous article it's not unusual to have one, and sometimes two very severe corrections before a final leg up in a ending bubble phase. As I pointed out in my previous article the NASDAQ had two back-to-back 10% corrections before a final 34% surge into that 2000 top.  So we have to ask ourselves, is the NASDAQ rolling over into a new bear market or is this just a final correction before one more surge higher? From a long-term perspective this looks like just a normal pullback to the 200 a moving average after a particularly powerful move over the last year.  I think at this point one still has to give the benefit of the doubt to the bulls. The fact that the advance decline line is still making new highs suggests that this is probably a consolidation in preparation for a break above that 1900 resistance zone.  That being said we now have the potential for the banks to start diverging from the general stock market. As I've noted in the past it's not unusual for the banking index to diverge for several months as stocks put in their final top. So if we see the S&P breakout to new highs over the next month or two but the banks continue to lag this would be a strong indication that a final bull market top is forming.  As most of you know my thesis for this year was that stocks would put in a final bull market top sometime this year, probably in the first half of the year, and that during this process liquidity/inflation would begin to leak out of the stock market and move into the commodity markets. We saw that process began in January as the CRB index delivered a strong initial surge and broke through its three-year downtrend line. After this initial surge is complete commodities should move down into a major yearly cycle correction in early summer followed by a much stronger move in the second half of the year. I think that midyear correction has probably begun. As oil is the most important global commodity it tends to drive the general commodity index. So when oil begins to move down into that yearly cycle correction the rest of the commodity complex should eventually follow as they top out one by one and follow oil lower. On Friday oil broke below its major intermediate uptrend line from the January bottom. This trend line break should signal that oil has begun moving down into its yearly cycle low. The CRB should soon follow oil lower, and I doubt that it will move above that 2012 high before rolling over into that intermediate degree midyear correction.  How does this pertain to gold? To begin with I think the capitulation phase that I theorized in my previous report is probably now off of the table. For that scenario to come to fruition the previous daily cycle needed to drop to the sub $1200 level before bottoming. It looks like gold probably put in that daily cycle low on Thursday at $1268. So does this mean that gold has bottomed and the next bull leg is ready to begin? While it's possible, I tend to think gold probably still has one more mild leg down before the larger intermediate cycle forms a more lasting bottom. Generally speaking the intermediate cycle in gold usually runs between 20 and 25 weeks. A bottom on Thursday would only be week 16. Also most intermediate cycles have at least four, and sometimes five daily cycles nested within them. As you can see in the chart below the current intermediate cycle only has three daily cycles so far. Unless gold can do something to confirm a short intermediate cycle I think we have to assume gold still has one more daily cycle down before this intermediate decline is complete.  Now that the capitulation phase is probably off the table I think the most likely target for a final intermediate bottom would be in the $1260-$1240 range somewhere around the end of May or beginning of June. If however gold were to rally very quickly back above the $1331 level by the end of next week then we could entertain the idea of a short intermediate cycle and a final end to gold's three-year bear market. This scenario would probably require that the stock market has put in a final bull market top, and as I noted at the beginning of this article, I'm not convinced that has happened just yet. I tend to think the moves in stocks and gold recently have been greatly influenced by the tensions in Ukraine. If conditions improve I would expect stocks to resume their trend higher and gold to continue down into a normal duration intermediate bottom in late May or early June.  Over the next 1-2 months commodities should move down into that midyear correction in preparation for a very powerful move up during the second half of the year. Gold should follow the rest of the CRB index down into that yearly cycle low, but I will keep an eye on it over the next week or two as the situation in Eastern Europe may push gold into a divergent path from the rest of the commodity complex.       |
| Avnel Gold Still Has A Lot Of Room To Run Posted: 26 Apr 2014 07:19 AM PDT (Note that Avnel Gold (OTC:AVNZF) shares are extremely illiquid on both the OTC market an on the TSE (AVK). Investors are advised to consider this illiquidity before taking a position. Specifically investors need to be sure that this is a position that they will not have to liquidate on short notice.) Avnel Gold is one of the best performing gold miners year to date, with shares rising over 60%. Unlike most of its peers the bulk of these gains came in March after the company released its latest resource estimate and its preliminary economic assessment for its flagship Kalana Mine in Mali. This updated information sent shares soaring, and I suspect that we can see further gains after an initial consolidation period. The reason for the gains, which totaled more than 100% in just over a week, was the company's announcement of compelling production estimates for the Kalana Mine. In |
| THE BLUEPRINT TO ENDING THE FED! Posted: 26 Apr 2014 06:31 AM PDT Podcast: Play in new window | Download
Special guest Dennis Linthicum documents the blueprint to ending the Fed: |
| The Blueprint to Ending the Fed! Posted: 26 Apr 2014 06:25 AM PDT
 Congressional candidate Dennis Linthicum joins Metals & Markets to discuss the blueprint to ending the Fed, as well as: CME announces plans to launch a PHYSICALLY SETTLED gold exchange in Asia Russian media reporting that Russia, Kazakhstan and Belarus will sign an agreement in May to accelerate the formation of an economic union and a joint “gold” currency: the [...] The post The Blueprint to Ending the Fed! appeared first on Silver Doctors. |
| Is The Status Quo Dollar Negative? Posted: 26 Apr 2014 05:41 AM PDT It is not true that there has been a secret protocol, reintroducing fixed exchange rates, though the lackluster price action in the foreign exchange market and the continued erosion of volatility make it feel almost like it. Activity in the week ahead should pick up and trading ranges are likely to expand. There are a number of important events and economic reports. The FOMC meeting, US employment data, the euro area flash CPI reading and the first look at Q1 GDP in several countries, including the US, UK and Spain should provide new incentives. That said, the general considerations about investment climate are unlikely to change. Fed tapering continues, but a rate hike is still more than a year away. The ECB is likely to take fresh action, with the April 30 flash CPI report, shaping expectations for either a May or June move. China's PMIs are likely to |
| Lawrence Williams: Two-Faced Goldman Appears to Hedge Bets on Gold Stocks and Bullion Posted: 26 Apr 2014 05:18 AM PDT "A runaway "no ask" silver rally would bankrupt the firm" ¤ Yesterday In Gold & Silver[Note: After three years without a break, I'll be taking some time off. There will be no Gold and Silver Daily next week. Ed] It was a very uneventful day for the gold price in Far East trading on their Friday, but the price began to develop a positive bias right from the London open---and that continued right up until 10:30 a.m. EDT in New York. After that, it didn't do much. However, it did manage to close about the $1,300 spot price mark---and I'm happy about that, as "da boyz" could have just as easily sold in down below that mark before they headed out the door for the weekend. The CME Group recorded the low and high ticks as $1,290.40 and $1,304.80 in the June contract. The gold price closed in New York at $1,303.80 spot, up $9.90 from Thursday's close. Volume, net of April and May, was reasonably light at only 113,000 contracts. Silver got sold down about 20 cents starting around 9 a.m. Hong Kong time, but then began to rally around 11 a.m. in London---with the high tick of the day also coming at 10:30 a.m. EDT New York. From there it got sold down about 15 cents, but recovered a bit of that during that last hour or so of electronic trading. The low and highs were recorded as $19.515 and $19.81 in the May contract. Silver finished the Friday trading session at $19.725 spot, up 7.5 cents from Thursday's close. Gross volume was very heavy, with lots of roll-overs---and net volume was miniscule at only 17,000 contracts. The platinum chart was very similar to both silver and gold---and the rally that began at 10 a.m. BST in London spiked to its high of the day around 10:30 a.m. in New York. But a seller was waiting---and carved 10 bucks off its gain by 2 p.m. in electronic trading. After that it traded flat into the close. Palladium spent 12 hours trading a few dollars below the $800 spot price mark, but got bumped a few dollars above it starting around 9 a.m. in London. From there it traded ruler flat once again until shortly after 10 a.m. in New York---and the tiny rally that began at that point got capped within an hour or so before it got very far. But I was happy to see palladium close above the $800 price mark. The dollar index closed late Thursday afternoon in New York at 79.77---and began drifting gently lower as soon as Far East trading began on their Friday morning. The low tick of 79.68 was set twice---once just before 9 a.m. EDT, and the other a minute or so after 10 a.m. EDT. From there it rallied back to basically unchanged [79.76] by the close of trading. And as has been the case most of this week, the scale of the chart made the 'action' look far more dramatic looking than it actually was. The gold stocks gapped up a bit over a percent at the open---and hit their interim high shortly after 10 a.m. in New York when the gold price topped out. From there they drifted gently lower, hitting their low tick around 1:30 p.m. But then a rally of some substance developed, which accelerated during the last 45 minutes of trading---and the HUI finished on its absolute high of the day, up 2.43%. The gold equities had a pretty decent week. Here's the 5-day chart courtesy of ino.com. Not surprisingly, the silver equities followed a very similar price pattern, but at the end of the day, Nick Laird's Intraday Silver Sentiment Index closed up only 0.67%. The CME's Daily Delivery Report showed that 127 gold and 14 silver contracts were posted for delivery on Tuesday. The only short/issuer in gold was Canada's Scotiabank---and the largest long/stopper was JPMorgan in its in-house [proprietary] trading account. Scotiabank also stopped all 14 silver contracts---and the link to Friday's Issuers and Stoppers Report is here. For the second day in a row there were no reported changes in either GLD or SLV. The good folks over at shortsqueeze.com updated their website with the current short positions for both GLD and SLV [for the period ending April 15] very early on Saturday morning EDT. They weren't big changes, but both were headed in the right direction. The short position in GLD declined by 7.65%---and the short position in SLV declined by 1.76%. Based on the small residual short positions that still exist in both ETFs, I would guess that the authorized participants who may have been short the metal earlier, are now completely covered---and there are just 'plain vanilla' investors holding what's left. I received a report from Switzerland's Zürcher Kantonalbank yesterday---and this is what they had to say for themselves for the reporting period ending on Thursday, April 17. There were withdrawals from both ETFs. Their gold ETF was down 13,666 troy ounces---and their silver ETF declined by 114,071 troy ounces. The U.S. Mint had another sales report yesterday. They sold 106,000 silver eagles and that was all. Month-to-date the Mint has sold 31,500 troy ounces of gold eagles---14,000 one-ounce 24K gold buffaloes---3,675,000 silver eagles---and 1,000 platinum eagles. Based on these numbers, the silver/gold sales ratio for April works out to be a bit over 80 to 1. Year-to-date the silver/gold ratio stands at 69 to 1. Over at the Comex-approved depositories on Thursday, there was no reported in/out movement in gold once again. But silver was far more active, as nothing was reported received---and 975,362 troy ounces were shipped out. CNT and Scotiabank were the two depositories involved---and the link to that action is here. With not much change in the silver price---and about a ten dollar decline in the gold price during the reporting week, along with some expected spill-over from the big down-day on Tuesday, April 15---both Ted and I were expecting a decent Commitment of Traders Report yesterday---but we didn't get it in either metal, as the Commercial net short positions were up in both. In silver, the Commercial net short position increased by a smallish 521 contracts, or 2.61 million ounces. The Commercial net short position now sits at 113.9 million troy ounces. Ted says that JPMorgan's short-side corner in the Comex silver market didn't change much---and is still around 100 million ounces, or about 87% of the Commercial net short position. In gold, the Commercial net short position increased by 2,921 contracts, or 292,000 troy ounces. The Commercial net short position now stands at 9.05 million troy ounces---and Ted says that JPMorgan's long-side corner in the Comex gold market remains unchanged at around 38,000 contracts, or 3.8 million troy ounces. I would have been interested in what the COT Report looked like at the close of trading on Thursday when JPMorgan et al engineered that big price decline in all four precious metals. But, alas, that data will be buried by the time next Friday's COT Report manifests itself. Here's Nick Laird's "Days of World Production to Cover Short Positions" chart updated with Friday's COT data for the Big 4 and Big 8 traders. If it wasn't for JPMorgan's long-side corner in the Comex gold market, the four precious metals would occupy the first four spots in a row on the right-hand side of the chart. Here's another couple of charts courtesy of Nick Laird. They show only the short positions of the Big 4 and Big 8 traders in both gold and silver in the Comex futures market---along with their respective prices going back eight years---and not just the one week shown in the "Days to Cover" chart posted above. I said in Friday's column that I was "very comfortable putting my marker down" that we'd seen the lows for this move down in both metals on Thursday. If that is truly the case---and I think it is---just look at the huge difference in the short positions of the Big 4 and Big 8 in both gold and silver now that prices are washed out to the downside in both metals. The short positions of the Big 8 traders are almost at record lows in gold---but it's almost the exact opposite in silver. I know that I've posted a couple of other charts this week that attempt to hammer home this point that Ted Butler has been making recently---and that's the dichotomy that exists between them. It's more than obvious in these two charts, especially since the middle of 2012. So---what will the Big 8 short holders do on the next rally in silver? Will they pile the shorts on even higher to kill it, or will they begin to cover? Beats me, but we'll find out which scenario develops on the next big silver rally. We would have found on Thursday if "da boyz" hadn't stepped in to kill the silver rally before it could get anywhere. Stay tuned! Since this is my last column until May 6---every story that's currently sitting in my in-box is going into this column---and I'll leave the final edit up to you. ¤ Critical Reads The Chinese take Manhattan: replace Russians as top apartment buyersFor the first time, the Chinese have become the biggest foreign buyers of apartments in Manhattan, real estate brokers estimate, taking the mantle from the Russians - whose activity has dropped off since the unrest in Ukraine and the imposition of sanctions against Russia by the United States. Wealthy Chinese are pouring money into real estate in New York and some other major cities around the world, including London and Sydney, as they seek safe havens for their cash and also establish a base for their children to get an education in the West. Reuters asked five of the top real estate brokerages for their ranking of foreign buyers in New York City. The Chinese ranked first in both volume and value of sales in all their estimates. Opinions differed on just how the Russians, Europeans and South Americans stacked up next. This Reuters story, co-filed from New York and Sydney, was posted on their Internet site during the east coast lunch hour yesterday---and I thank Roy Stephens for today's first news item.  Visa Tumbles as Russia Sanctions Threaten to Crimp ProfitVisa Inc. fell 5 percent, the most since July, after the world’s biggest bank-card network said economic sanctions against Russia could crimp profit this year. The shares tumbled $10.47 to close at $198.93 in New York, the worst performance in the Dow Jones Industrial Average. Visa is the biggest component of the 30-company index, which slid 0.8 percent. The sanctions may trim “several pennies” per share from fiscal 2014 earnings, Chief Financial Officer Byron Pollitt said yesterday after the firm reported quarterly results. The U.S. imposed sanctions on more than two dozen individuals and St. Petersburg-based OAO Bank Rossiya, prompting Visa and MasterCard Inc. to stop processing payments for some banks. Russian President Vladimir Putin responded to the sanctions by recommending that his country create its own payments system and change its laws. He said the two companies will lose market share. “The geopolitical situation will create additional risk for Visa and MasterCard in coming months,” Christopher Donat, an analyst at Sandler O’Neill & Partners LP, said today in a note to clients. “Pending Russian law could be negative for earnings.” This short Bloomberg piece showed up on their website early Friday afternoon MDT---and it's the second offering in a row from Roy Stephens. It's worth reading.  The Dollar Under Siege: Bud Conrad---Casey ResearchOur main feature today is by Casey Research Chief Economist Bud Conrad, who explores the most urgent narrative in finance that hardly anyone is talking about: the decline of the U.S. dollar. I don’t mean the dollar’s long, slow slide to zero that began on December 23, 1913 when the Federal Reserve was born. Everyone paying attention knows that the Fed has sapped the dollar of 98% of its purchasing power since then. Criminal? Yes. But not urgent. I’m talking about Vladimir Putin’s plans to circumvent the dollar in global trade. He, together with China, is making alarming progress toward undermining the dollar’s hegemony and all of the vast advantages the US Empire enjoys because of it. The U.S. government, of course, has a long history of protecting the dollar’s dominance and won’t let its special privileges go easily. Just for fun, before I pass the baton to Bud, let’s take a peek at the fate of three other prominent figures who dared to challenge king dollar. This longish commentary by Bud is definitely worth reading, as is the preamble to it by Casey Research's Dan Steinhart, the Managing Editor of The Casey Report.  'Mutual distrust': Ecuador ejects U.S. military groupEcuador has given a group of 20 U.S. Defense Department employees until the end of the month to quit the country. President Rafael Correa had previously said the presence of the U.S. military in Ecuador was “scandalous” and they had “infiltrated all sectors.” Ecuador has officially requested that all 20 Defense Department employees in the US Embassy in Quito cease their activities and leave the country by the end of the month, embassy spokesman Jeffrey Weinshenker confirmed to AP. He said the embassy had received a formal letter dated April 7, alerting them to the imminent expulsion of the group. Previously, Correa attacked the U.S.’s military presence in the Latin American country, claiming there were even more operatives. “There are about 50 of them. Who can justify this? We are now taking action accordingly,” he said in January, pledging to have them removed from the country. He added that these operatives had infiltrated all sectors of the Ecuadorian political sphere, referring to their presence as “scandalous.” John Perkins, author of "Confessions of an Economic Hit Man", would understand exactly why they're there. This Russia Today news item appeared on their website early in the afternoon Moscow Time---and I thank South African reader B.V. for bringing it to our attention. It's worth skimming.  Court probes 'crimes against humanity' in UkraineThe prosecutor of the International Criminal Court has opened a preliminary investigation into alleged crimes against humanity committed in Ukraine during the months leading to the fall of former president Viktor Yanukovich, the court said on Friday. "The prosecutor of the ICC, Fatou Bensouda, has decided to open a preliminary investigation into the situation in the Ukraine to establish whether... the criteria for opening a (full) investigation are met," the court said in a statement. Ukraine is not a member of the ICC, but it has granted the court jurisdiction over any crimes that might have taken place within its borders from November 21 to February 22, when Yanukovich was deposed. The new government of Ukraine referred the case to the ICC, alleging that Yanukovich’s troops killed more than 100 demonstrators in the capital Kiev and other cities. The referral covers the period up to the day before Russia annexed Ukraine’s Crimea region, meaning the court will not have to examine any possible crimes by Russian-backed troops during that time. This news item was posted on the france24.com Internet site yesterday---and it's another offering from Roy Stephens.  Merkel warns Putin to do more to end Ukraine crisisThe German chancellor, Angela Merkel, said on Friday that she told Vladimir Putin that Russia had not done enough to implement the Geneva accord and EU foreign ministers would meet as soon as possible to contemplate further sanctions against Russia. At a news conference in Berlin with Poland's prime minister, Donald Tusk, Merkel said Russia had the means to convince the pro-Russian separatists in Ukraine to take a peaceful route but showed no sign of doing so. "I spoke to the Russian president this morning and made clear again that on the one hand Ukraine has taken a whole series of steps to implement the Geneva accord but on the other side I see no Russian backing for the accord which would of course have an effect on the separatists in Ukraine," she said. "We will therefore have to react. This will be a joint European action and an action by the G7 ... because of the lack of progress we will have to contemplate further sanctions within the second stage of sanctions." This article appeared in The Guardian later in the afternoon BST---and it's courtesy of Roy Stephens as well.  Furious Russia, Downgraded to Just Above Junk By S& |
| The Dollar Under Siege: Bud Conrad---Casey Research Posted: 26 Apr 2014 05:18 AM PDT The Dollar Under Siege: Bud Conrad---Casey Research Our main feature today is by Casey Research Chief Economist Bud Conrad, who explores the most urgent narrative in finance that hardly anyone is talking about: the decline of the U.S. dollar. I don’t mean the dollar’s long, slow slide to zero that began on December 23, 1913 when the Federal Reserve was born. Everyone paying attention knows that the Fed has sapped the dollar of 98% of its purchasing power since then. Criminal? Yes. But not urgent. I’m talking about Vladimir Putin’s plans to circumvent the dollar in global trade. He, together with China, is making alarming progress toward undermining the dollar’s hegemony and all of the vast advantages the US Empire enjoys because of it. The U.S. government, of course, has a long history of protecting the dollar’s dominance and won’t let its special privileges go easily. Just for fun, before I pass the baton to Bud, let’s take a peek at the fate of three other prominent figures who dared to challenge king dollar. This longish commentary by Bud is definitely worth reading, as is the preamble to it by Casey Research's Dan Steinhart, the Managing Editor of The Casey Report. |
| Posted: 26 Apr 2014 05:18 AM PDT  Three King World News Blogs 1. Ronald-Peter Stoferle: "World Monetary System on the Way to a New Gold Standard" 2. Felix Zulauf: "The World Monetary System is Going to Collapse" 3. Michael Pento: "Man Censored on CNBC Says Gold Worth at Least $6,000 Today" |
| Posted: 26 Apr 2014 05:18 AM PDT  Bank of Nova Scotia to get visit from British watchdog as scrutiny of London gold fixing grows, sources say Regulators are stepping up their scrutiny of how gold prices are set, with officials from Britain’s Financial Conduct Authority visiting all five member banks including the Bank of Nova Scotia to observe the so-called London fixing process, two people with knowledge of the matter said. |
| Will regulators and journalists ever dare to look behind the London gold fix banks? Posted: 26 Apr 2014 05:18 AM PDT  Will regulators and journalists ever dare to look behind the London gold fix banks? Britain's Financial Conduct Authority has begun observing the London gold fixing process, Bloomberg News reports today in a story appended here, and Bloomberg even acknowledges, if only in the briefest way, that the London gold fix price is "used" by central banks. Unfortunately Bloomberg does not yet seem to have inquired into just how and why central banks use the London fix. Could it be that central bank gold doesn't just sit sleepily in central bank vaults gathering dust, as central banks, investment houses, and mainstream financial news organizations would have the world believe, but rather that it enters world markets every day in pursuit of some secret government policy objective? GATA long has been supplying Bloomberg and other mainstream financial news organizations with the documentation of the Western central bank gold price suppression scheme involving the secret mobilization of central bank gold to deceive and manipulate markets. But news organizations purporting to cover the gold market still can't bring themselves to put critical questions to the market's primary participants, central banks. Are the representatives of the Financial Conduct Authority in the U.K. any less skittish? Are the regulators who are beginning to observe the bullion banks conducting the London fix asking who is on the other end of the banks' telephone lines -- and are they settling for the identification of some intermediary broker or are they inquiring as to who is on the other end of the intermediary broker's telephone line? This longish commentary by GATA's secretary/treasurer Chris Powell was posted on the gata.org Internet site yesterday---and is well worth reading. |
| U.S. Exports a Record Amount of Gold to Hong Kong in January Posted: 26 Apr 2014 05:18 AM PDT U.S. Exports a Record Amount of Gold to Hong Kong in January The figures are out and it looks like the United States exported a record amount of gold to Hong Kong in January. Not only was this a one month record… it was a WHOPPER indeed. Last year, the U.S. exported a total of 215 metric tons of gold bullion to Hong Kong. This was not the total amount of gold exported to Hong Kong as some smaller quantities of Dore’ and precipitates made their way into the country as well. However, Hong Kong received more gold than any other country… Switzerland came in second at 150 metric tons. The table below shows the breakdown in U.S. Gold Bullion exports in 2013. Here we can see that the highest month of gold bullion exports to Hong Kong in 2013 was in August at 30.7 metric tons (mt)… let’s just say an even 31 mt. According to the data just released by the USGS, the United States exported a stunning 57 mt of gold bullion to Hong Kong in January. This gold-related story appeared on the Zero Hedge website late on Thursday evening---and I thank Peter Handley for sharing it with us. |
| U.S. suits hobble Deutsche Bank's bid to sell gold fix seat Posted: 26 Apr 2014 05:18 AM PDT U.S. suits hobble Deutsche Bank's bid to sell gold fix seat Deutsche Bank may end up resigning its seat on the London gold fix rather than selling it as U.S. lawsuits alleging price rigging against the five banks that set the benchmark deter potential buyers, industry sources said. Over the past two months, U.S.-based investors and traders have filed nearly 20 antitrust claims accusing Barclays, Deutsche Bank, HSBC, Bank of Nova Scotia, and Société Générale of colluding to manipulate the gold price. At the time the initial suits were filed, Société Générale called the claims "unsubstantiated" and Deutsche Bank described them as "without merit." |
| Sunken Gold Untouched for 157 Years Off U.S. Lures Hunter Posted: 26 Apr 2014 05:18 AM PDT Sunken Gold Untouched for 157 Years Off U.S. Lures Hunter Treasure-hunter Bob Evans has spent half his life dreaming about the SS Central America, a pre-Civil War steamship decaying in the lightless depths off South Carolina. Now he’s returning to the shipwreck after 23 years. Evans, 60, set out this week with deep-ocean explorer Odyssey Marine Exploration Inc. to revisit the remains of the 19th-century side-wheel steamer, which sank in 1857 with the loss of 425 lives and an undetermined amount of gold. Despite recovery efforts in 1989 through 1991 that netted more than two tons of the precious metal, Odyssey says there may still be $86 million of gold lying more than a mile below the surface of the Atlantic. “This is the greatest lost treasure in United States history,” Evans, who was chief scientist on the earlier expeditions, said in a phone interview before the ship sailed. This interesting Bloomberg news item showed up on their Internet site early yesterday afternoon Denver time---and I thank reader Ken Hurt for finding it for us. |
| Canadian bank CIBC starts selling real gold, not just paper Posted: 26 Apr 2014 05:18 AM PDT  Canadian bank CIBC starts selling real gold, not just paper Canadians looking to buy gold and silver now have fast and convenient options at CIBC branches and a new online store, which can also be accessed via a mobile device. High-quality gold and silver bars, coins including collectibles, and certificates are available for purchase at all CIBC branches across Canada. Branch, online and mobile purchases may be made by CIBC clients and by those who currently bank elsewhere. |
| Safe Deposit Boxes Are Not Safe for Silver and Gold Buyers Posted: 26 Apr 2014 05:18 AM PDT  Safe Deposit Boxes Are Not Safe for Silver and Gold Buyers Many silver and gold buyers forget one of the main reasons to buy physical silver and gold bullion today is due to the world's current fragile financial system. Some even make the mistake of buying physical bullion and then storing it in a Safe Deposit Box at their local bank. Why is that a mistake? Safe "deposits" held within regulated bank boxes are not very safe, nor private, nor FDIC insured deposits. This short article was posted on the goldsilver.com Internet site yesterday---and there's a 6:44 minute video by Mike Maloney embedded in the story as well. Both are worth your time---and it's my opinion that this commentary is primarily directed at U.S. citizens residing in the USA. |
| Peter Schiff: Reckless Fed may push gold to $5,000 Posted: 26 Apr 2014 05:18 AM PDT  Peter Schiff: Reckless Fed may push gold to $5,000 Peter Schiff, chief executive officer of Euro Pacific Capital, has been known to make forecasts outside the mainstream, and his long-running belief that gold has the potential to hit $5,000 an ounce is no exception. Prices, after all, are struggling to get a grip on $1,300. We caught up with Schiff to ask him how gold, a big disappointment for commodities investors last year, gets back its groove. Last year, gold futures and heavyweight ETF SPDR Gold Trust lost 28%, breaking at least eight years of annual gains. First off, Schiff’s gold forecast isn’t brand new. The author of “The Real Crash — America’s Coming Bankruptcy” has talked about the possibility of gold hitting $5,000 or higher since at least 2011, when prices for the metal topped $1,900 in intraday trading. This story appeared on the marketwatch.com Internet site yesterday morning EDT---and it's the final offering of the day from Roy Stephens. |
| Two-faced Goldman appears to hedge bets on gold stocks and bullion Posted: 26 Apr 2014 05:18 AM PDT  Two-faced Goldman appears to hedge bets on gold stocks and bullion Did no-one tell Goldman Sachs equities analysts Andrew Quail and Jitendra Pandey that the same company’s Jeffrey Currie is still saying that gold is a ‘slam-dunk’ sell and that the gold price will collapse to around $1,050 an ounce by year end, and may go even lower on the way. If so one assumes they don’t believe this ultra-downbeat forecast, which so far this year has been pretty wide of the mark. But then it’s early days yet. Or is Goldman Sachs just hedging its bets and looking for a fall in the gold price and perhaps also a stabilisation – or even a rise – in at least some gold equity prices even though the metal price could yet collapse – seemingly a contradiction in analytical terms. In short Quail and Pandey view the moves being taken by the gold producers to reduce capital expenditures and cut unit operating costs as being at least somewhat positive for gold equities. Consequently they have upgraded Goldman’s view on the precious metals mining sector from ‘sell’ to ‘neutral’, and commend gold mining companies for “more responsible use of shareholder wealth.” I mentioned this dichotomy in my column the other day, but Lawrence Williams over at the mineweb.com Internet site really takes them to task in this commentary posted on their website on Thursday. |
| Imagine how much more disease might be eradicated by a free-market gold price Posted: 26 Apr 2014 05:18 AM PDT Imagine how much more disease might be eradicated by a free-market gold price The Financial Times reports approvingly -- see below -- about the success of Anglogold Ashanti in almost eradicating malaria among the population around its gold mine at Obuasi in Ghana. But will the FT ever acknowledge that a free-market gold price could eradicate not only malaria in Ghana but much disease throughout the gold-producing continent of which Ghana is a part? For that matter, will African governments themselves ever figure it out and summon the courage to do something about it? Of course this may take a while, since FT employees, gold-price suppressing central bankers, and African government officials already have pretty good medical care. A tiny portion of this FT story is posted in the clear in this GATA release from yesterday---and if you want to read the rest, you have to sign up at the FT website. |
| Novartis: Will Restructuring Prove Fruitful For The Company? Posted: 26 Apr 2014 03:33 AM PDT For a long time Novartis AG (NVS) has been considering transforming its business by cutting off segments that lack global scale and do not significantly contribute to the company's revenues. Divesting its non-core businesses that were unlikely to achieve global scale was an easy way to achieve transformation. The animal healthcare division was the highest priority of the company to divest as discussed in my previous article. Now Novartis has entered into multibillion dollar deals with GlaxoSmithKline (GSK) and Eli Lilly and Company (LLY) and that will be the focus of the discussion in this article. I will try to ascertain whether or not these deals will be fruitful for Novartis in the long term. (click to enlarge) Source: Novartis Presentation Novartis Buying GSK's Cancer Drug Business Novartis is going to buy GlaxoSmithKline's oncology drug business, but this is not the only deal between the two pharmacy giants. This |
| Reader Question on Shadow Banking and Gold Buying in China Posted: 26 Apr 2014 01:00 AM PDT Global Economic Analysis |
| Posted: 25 Apr 2014 08:58 PM PDT The US and its Western allies are preparing to launch a second round of sanctions on Monday in response to Russia’s invasion of the Crimea and the alleged use of special forces in eastern Ukraine to forment discontent and seize key government buildings. US stocks fell back sharply on Friday as the crisis showed no signs of abating, a party of international observers was detained by pro-Russian separatists and Russian jets flew over Ukrainian territory. There have been several military clashes with a number of casualties. To many observers it looks like the prelude to a full-on invasion of eastern Ukraine to ‘rescue’ pro-Russian separatists. Black Monday This threatens a Black Monday for global financial markets which have been slow to take this mounting crisis seriously. On Friday gold hit a nine-day high of $1,305 and treasuries advanced in a flight to safe haven assets. Sanctions on Monday will focus attention on the Ukraine and what comes next. An invasion of eastern Ukraine would bring a third, and much more damaging round of sanctions. There is also going to be the inevitable Russian response to such an attack on its sovereign interests. The $3.5 billion gas bill just delivered to Kiev is just the start. But that will also serve as a reminder to Europe about its dependence on Russian gas supplies. Any disruption of supplies to the Ukraine will impact on Europe as Russian gas that passes through this country would be diverted to stop the Ukraine freezing next winter. If nothing else this will push up gas prices and oil prices too. Russia is the world’s largest energy exporter and this is its most powerful economic weapon. Think back to 1973 and the Arab Oil Embargo. Markets will track these developments but at the moment they have yet to discount anything going wrong in the Ukraine at all. Therefore the sudden realization of what could go wrong will have to be added to a wake-up call to digest events so far. Ready to fall? Given that many Western stock markets are hovering close to all-time highs the potential for a major correction is very high, not something you would believe from the Vix fear index. But then complacency is also a feature of major market tops and that also just sets us up for a bigger fall. So it would not be unreasonable to predict a big sell-off in stock markets on Monday, higher precioius metal prices, higher bond prices, a flight to the yen and Swiss franc and higher energy prices. And that is before hardly a shot has been fired. When the shooting starts panic would really set in. Every over-priced asset class in the world could come tumbling down in a huge heap. Nobody thought this could happen in April 2008 either. But it did! |
| Regulators scrutinize London gold fix Posted: 25 Apr 2014 07:49 PM PDT People with knowledge of the matter say Britain's Financial Conduct Authority officials are visiting Societe Generale to observe the so-called London fixing process. |
| Gold bears punish the miners - charting the damage Posted: 25 Apr 2014 07:47 PM PDT We take a look at how badly (for most part) gold stock have fared since the gold price went south mid-March. |
| Steve St. Angelo: U.S. gold exports to Hong Kong explode to record in January Posted: 25 Apr 2014 04:02 PM PDT GATA |
| Posted: 25 Apr 2014 03:21 PM PDT |
| Gold Daily and Silver Weekly Charts - Madness, Ending Badly Posted: 25 Apr 2014 03:03 PM PDT Le Cafe Américain |
| Imagine how much more disease might be eradicated by a free-market gold price Posted: 25 Apr 2014 03:02 PM PDT GATA |
| Gold Bounces Back Above $1,300 as Ukraine Crisis Escalates Posted: 25 Apr 2014 01:50 PM PDT John Kerry and other U.S. officials and once again banging the war drums. In the most recent comments, Kerry said that the United States is “ready to act against Russia.” The truth is that the U.S. has been acting against Russia for quite some time in various ways. The implication here is that the U.S. [...] |
| How Gold & Mining Companies Will Respond to the Coming Big Reset Posted: 25 Apr 2014 01:45 PM PDT
 It’s quite easy to understand why central banks would like to revalue gold to devalue the dollar at a certain stage of this reset. The U.S.’s official gold reserves, which are still listed at 8,000 tons, are valued at the historical cost price of $42/oz. A revaluation toward $4,200/oz would grow the value of these [...] The post How Gold & Mining Companies Will Respond to the Coming Big Reset appeared first on Silver Doctors. |
| Posted: 25 Apr 2014 01:37 PM PDT This video focuses on inflation, commodities, commodity stocks and Gold and gold stocks….
The post Video Market Update (15 mins) appeared first on The Daily Gold. |
| Posted: 25 Apr 2014 01:37 PM PDT Do you know this man?
You should... he is now in charge of the CFTC, the government agency that "regulates" gold and silver futures trading, now that our buddy Gary Gensler has retired. His name is Tim Massad and he will do absolutely nothing to enforce the rule of law or ensure fairly traded markets. |
| Controversial post: 2014 is turning out to be "eerily similar" to 2007 Posted: 25 Apr 2014 10:36 AM PDT From Michael Snyder of The Economic Collapse: The similarities between 2007 and 2014 continue to pile up. As you are about to see, U.S. home sales fell dramatically throughout 2007 even as the mainstream media, our politicians and Federal Reserve Chairman Ben Bernanke promised us that everything was going to be just fine and that we definitely were not going to experience a recession. Of course we remember precisely what followed... It was the worst economic crisis since the days of the Great Depression. And you know what they say – if we do not learn from history we are doomed to repeat it. Just like seven years ago, the stock market has soared to all-time highs... Just like seven years ago, the authorities are telling us that there is nothing to worry about. Unfortunately, just like seven years ago, a housing bubble is imploding and another great economic crisis is rapidly approaching. Posted below is a chart of existing home sales in the United States during 2007. As you can see, existing home sales declined precipitously throughout the year...
Now look at this chart which shows what has happened to existing home sales in the United States in recent months. If you compare the two charts, you will see that the numbers are eerily similar...
New home sales are also following a similar pattern. In fact, we just learned that new home sales have collapsed to an 8 month low... Sales of new single-family homes dropped sharply last month as severe winter weather and higher mortgage rates continued to slow the housing recovery. New home sales fell 14.5% to a seasonally adjusted annual rate of 385,000, down from February's revised pace of 449,000, the Census Bureau said. Once again, this is similar to what we witnessed back in 2007. The following is a chart that shows how new home sales declined dramatically throughout that year...
And this chart shows what has happened to new homes sales during the past several months. Sadly, we have never even gotten close to returning to the level that we were at back in 2007. But even the modest "recovery" that we have experienced is now quickly unraveling...
If history does repeat, then what we are witnessing right now is a very troubling sign for the months to come. As you can see from this chart, new home sales usually start going down before a recession begins. And don't expect these housing numbers to rebound any time soon. The demand for mortgages has dropped through the floor. Just check out the following excerpt from a recent article by Michael Lombardi... One of the key indicators I follow in respect to the state of the housing market is mortgage originations. This data gives me an idea about demand for homes, as rising demand for mortgages means more people are buying homes. And as demand increases, prices should be increasing. But the opposite is happening… In the first quarter of 2014, mortgage originations at Citigroup Inc. (NYSE/C) declined 71% from the same period a year ago. The bank issued $5.2 billion in mortgages in the first quarter of 2014, compared to $8.3 billion in the previous quarter and $18.0 billion in the first quarter of 2013. (Source: Citigroup Inc. web site, last accessed April 14, 2014.) Total mortgage origination volume at JPMorgan Chase & Co. (NYSE/JPM) declined by 68% in the first quarter of 2014 from the same period a year ago. At JPMorgan, in the first quarter of 2014, $17.0 billion worth of mortgages were issued, compared to $52.7 billion in the same period a year ago. (Source: JPMorgan Chase & Co. web site, last accessed April 14, 2014.) It is almost as if we are watching a replay of 2007 all over again, and yet nobody is talking about this. Everyone wants to believe that this time will be different. The human capacity for self-delusion is absolutely amazing. There are a lot of other similarities between 2007 and today as well. Just the other day, I noted that retail stores are closing in the United States at the fastest pace that we have seen since the collapse of Lehman Brothers. Back in 2007, we saw margin debt on Wall Street spike dramatically and help fuel a remarkable run in the stock market. Just check out the chart in this article. But that spike in margin debt also made the eventual stock market collapse much worse than it had to be. And just like 2007, consumer credit is totally out of control. As I noted in one recent article, during the fourth quarter of 2013 we witnessed the biggest increase in consumer debt in the U.S. that we have seen since 2007. Total consumer credit in the U.S. has risen by 22 percent over the past three years, and 56 percent of all Americans have "subprime credit" at this point. Are you starting to get the picture? It is only 7 years later, and the same things that happened just prior to the last great financial crisis are happening again. Only this time we are in much worse shape to handle an economic meltdown. The following is a brief excerpt from my recent article entitled "We Are In FAR Worse Shape Than We Were Just Prior To The Last Great Financial Crisis"... None of the problems that caused the last financial crisis have been fixed. In fact, they have all gotten worse. The total amount of debt in the world has grown by more than 40 percent since 2007, the too big to fail banks have gotten 37 percent larger, and the colossal derivatives bubble has spiraled so far out of control that the only thing left to do is to watch the spectacular crash landing that is inevitably coming. You can read the rest of that article right here. For a long time, I have been convinced that this two-year time period is going to represent a major "turning point" for America. Right now, 2014 is turning out to be eerily similar to 2007. Will 2015 turn out to be a repeat of 2008? Please feel free to share what you think by posting a comment below...
More Cruxellaneous: Top trader Clark: Watch for this sign the rally in stocks is over If you're looking for safe yield, get your money OUT of the U.S. dollar, and put it here Doc Eifrig: This everyday item is putting your prostate at serious risk |
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