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Tuesday, July 14, 2015

Gold World News Flash

Gold World News Flash

Silver Pretty, Silver Ugly

Posted: 13 Jul 2015 11:01 PM PDT

The big picture in simple terms: US national debt is huge, ugly, unpayable, and accelerating higher. Silver Eagles are pretty and are priced low. Silver prices will increase erratically, driven...

{This is a content summary only. Click on the blog title to continue reading this post, share your comments, browse the website, and more!}

SHAKEDOWN: The Great Banking Game of the BIS

Posted: 13 Jul 2015 10:30 PM PDT

by Jay Dyer, 21st Century Wire:

Greece has been in the news with the left socialist Syriza Party caving (predictably) to the IMF's economic terrorism, resulting in bank runs and capital controls.

Echoing the previous two bail outs back to 09 and 10, the new "plan" will undoubtedly result in more collateral seizure of Greek assets for the engineered debt crisis shock doctrine that controls virtually all nations.

Nothing new here, but it is illustrative for understanding the global banking structure that emerged from World War II at the Bretton Woods Conference in 1944.  However, as we will see, the real structure extends further back into the shadows of World War I.

Originally Bretton Woods' plan tied to the U.S. dollar-backed by gold, in 1971, the dollar became fiat (Nixon shock), resulting in a global fiat system centered around command and control large-scale economic planning and fixed exchange rates.

Read More @ 21stCenturyWire.com

Gold Prices Defy Odds, Decline on Uncertainty in Greece

Posted: 13 Jul 2015 09:20 PM PDT

by Michael Lombardi, Profit Confidential:

If you thought Greece's recent fiasco would cause gold prices to soar, you were left disappointed.

Despite Greece failing to pay the International Monetary Fund (IMF) and its banks being closed, the yellow metal declined in price as Greece's woes intensified, as the chart below shows.

This is a very different situation from when Greece made headlines in the past. In April 2010, when news first came out that Greece might default on its debt, and eurozone nations scrambled to get a bailout for the country, gold prices rose six percent in a month. Look at the chart below to see how gold reacted back then.

Read More @ ProfitConfidential.com

Gold Daily and Silver Weekly Charts – ‘Peace In Our Time’

Posted: 13 Jul 2015 08:00 PM PDT

from Jesse's Café Américain:


Greek Prime Minister Alexis Tsipras seems to have folded precipitously, after apparently having taken all other options off the table including a Grexit, a movement toward the burgeoning China Development Bank, an impasse.

His strategy seemed a bit out of joint. I have heard that Victoria Nuland made him a personal offer he could not refuse, and he did not wish to offer a ‘principled resignation’ as did Varoufakis.

(Note: I am now mulling this and a few other things over in light of this new interview by Varoufakis.)

It could be that he was then taken aback and surprised by the sheer ferocity of the European (German) proposal, which was to essentially make Greek into a protectorate, and to visit a looting of national assets, given that the loans being granted are completely unpayable and the collateral will be forfeit.

Read More @ Jessescrossroadscafe.blogspot.ca

Gold Price Fell $2.50 or 0.22 Percent to $1,155.20

Posted: 13 Jul 2015 07:07 PM PDT

13-Jul-15PriceChange% Change
Gold Price, $/oz1,155.20-2.50-0.22%
Silver Price, $/oz15.44-0.03-0.21%
Gold/Silver Ratio74.838-0.007-0.01%
Silver/Gold Ratio0.01340.00000.01%
Platinum Price1,036.003.700.36%
Palladium Price657.958.601.32%
S&P 5002,099.6022.981.11%
Dow17,977.68217.271.22%
Dow in GOLD $s321.704.571.44%
Dow in GOLD oz15.560.221.44%
Dow in SILVER oz1,164.6616.461.43%
US Dollar Index97.000.830.86%

3 Day Gold Price Chart
30 Day Gold Price Chart
5 Year Gold Price Chart
3 Day Silver Price Chart
30 Day Silver Price Chart
5 Year Silver Price Chart
The GOLD PRICE fell $2.50 (0.22%) to $1,155.20 while SILVER ended Comex down 3.2 cents (0.21%) at $15.436. GOLD/SILVER RATIO was almost flat at 74.838.

At the same time today -- about 4 a.m. Eastern -- silver and GOLD PRICES tanked and the US dollar index soared. The heavy lifting was all done by the time Comex opened, but the price of gold dipped around 11:00 to its low around $1,149.80. Must have been buyers hiding behind $1,150, because it rose from there to $1,158 and flatline the rest of the day. The silver price ranged from $15.27 to $15.90.

I can't help it, I see what I see and it looks good. Silver has left a V-bottom behind that promises at least some rally, maybe to the 200 DMA above at $16.50. Whether that will hold or it will do something more creditable than that, who knows. The gold price just trod water in the selfsame range it's held the last five days. No message there except "beneath $1,150 lurk buyers."

Commitments of traders reports have become much more bullish for both silver and gold. That leads me to suspect that after today's Greek news shake-out silver and gold prices may still rise this week. Big customers we haven't heard from since the early days of the bull market are calling again and placing serious orders. Does that mean anything?

I've been thinking. One reason for the big drops in platinum and especially palladium must be some big seller. Russia produces 75-80% of the world's palladium and 25% of the platinum, and is suffering under Western sanctions. If the Russians are selling palladium to raise money, that might account for that drop.

The futures market proverb says, "Sooner or later everything comes back to physicals." I reckon in the naïve day when that proverb began before manifold manipulations and cash settlement that was true. Still is true,really, for in the end the pricing of everything should refer back to the physical supply.

That's what's getting my attention with physical gold and silver. I see a headline on bulliondesk.com today, "Investors are simply not interested in gold at the present and physical demand is weak." Well, that ain't so in Tennessee, I'll bet you, or in the rest of the US. The premium on US 90% silver coin is right sensitive to silver price, often foreshadowing a fall or rise. Since 1 June it has risen from $1.35 an ounce over spot at wholesale to $3.10 today.

Gold coin premiums generally stay much tamer, but Krugerrands, whose wholesale buy premium has been around 1% over spot forever, have within the last three weeks crept up to 1.7%. Today I got a bad surprise when I tried to order a picayune two dozen Krugerrands and two different wholesalers quoted me two to three week delays. That sort of shortage in the gold coin market hasn't been heard of since the financial crisis of 2008.

The door into physical gold and silver is very, very narrow. It's usually easy to pass through, but when a crowd want through that door, it just clogs up. Best way not to clog with it is to walk through that door before the crowd shows up.

Well, the Greeks took a deal from the Europeans and they won't have to sell their children into slavery to pay the government's debt after all. They will however suffer deep government budget cuts, hefty tax hikes, and have to put big swaths of the country up for sale. One economist said the terms would cause Greece's economy to shrink 10% over the next 3 years, after shrinking 25% since 2008. Lesson is, you can't do business with usurers, but I doubt many folks today can even spell usurers. Loan sharks, for y'all who're wondering what I mean, the loan sharks have Greece by the throat and they're going to break their legs if they don't pay.

"The usurer loves the borrower as the ivy loves the oak."

A thought about price cutters. Folks call us from time to time and ask why we charge a little more than XYZ, the big precious metals dealer on the internet. My short answer is, "I don't aim to be the Wal-Mart of gold and silver." My longer answer is, I want to stay in business and I need to make a living. In the 35 years I've been doing this, I've seen lots of price cutters come and go. I take no pleasure in anyone's trouble, but go look at the Bullion Direct website and read the notice that's been there about a week, "Bullion Direct has experienced significant transactional delays. To avoid further inconvenience or other adverse consequences to our customers, Bullion Direct is suspending it operations as it attempts to resolve these issues." It's been a long bear market.

There's another reason I'm not studying to compete on price: our guidance into those items that net you the most gold and silver for your money, not the most heavily marketed or numismatic items, will usually pay our paltry 3.5% to 1% commission. And we are live human beings, from America, who tailor our service to your needs, not a computer program or a minimum wage order taker. And I don't exaggerate when I tell you that some of our customers over the years have added fifty percent or more to their ounces by following our gold-silver swapping strategy. When you offer people that sort of service, not many complain about 3.5% to 1% commission. But you can't please everybody.

Back to today's markets.

Stocks had as much fun as a wino at happy hour. Dow rose 217.27 (1.22%) to 17,977.68. S&P500 jumped 22.98 (1.11%) to 2,099.60. I reckon they think the Greek settlement will change something, but if they see that they've got better eyes than this nat'ral born durned Tennessee fool. It's just more of the same, not "kick the can" but "kick the debtor and bail out the banks." What happens when one day one of those debtors won't be kicked any more and bites their durned leg? Sinks his teeth in up to the bone? Truth is, NOTHING has been fixed, nothing changed, nothing reformed since 2008. Sooner or later the boil will burst -- on the whole world economy. And the predators had better pray they don't become the prey. (Back off! I've got more metaphors in here and I'll use 'em!)

USD
Euro fell 1.38% to $1.1007, I reckon on the theory that you "buy the rumor and sell the news." But how does that explain the US dollar rising 83 basis points(0.86%) to 97? It don't, but the dollar's even-sided triangle does. The Greek drama (oooo, I'm sorry) drove the dollar temporarily back into the triangle but it broke out again today. A guess puts a target at 103.60. Yen shed whatever superpower Greece had given it and fell 0.58% to 80.99, strenuously eradicating any idea of a rally ever again. Here's a dollar chart on the right:

At day's end investors were selling bonds, which boosted yields. Yield on the 10 year treasury note rose 0.54% to 2.430% although he 30 year bond eased off 0.06%.

Aurum et argentum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 2015, The Moneychanger. May not be republished in any form, including electronically, without our express permission. To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $3,130.00; silver's primary is up targeting 16:1 gold/silver ratio or $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold or 18 ounces of silver. or 18 ounces of silver. US $ and US$-denominated assets, primary trend down; real estate bubble has burst, primary trend down.

WARNING AND DISCLAIMER. Be advised and warned:

Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures.

NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps.

NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced.

NOR do I recommend buying gold and silver on margin or with debt.

What DO I recommend? Physical gold and silver coins and bars in your own hands.

One final warning: NEVER insert a 747 Jumbo Jet up your nose.

Miners Buried In Billions Of Debt After "Colossal Misjudgment Of Demand"

Posted: 13 Jul 2015 06:00 PM PDT

If one had to craft a narrative around the state of the global economic "recovery", it might go something like this. Wildly optimistic assumptions about the sustainability of China's torrid economic growth (and the voracious demand for raw materials which accompanied it), led to overbuilding and oversupply in the lead up to the crisis. In the aftermath of 2008, not only have multiple rounds of central bank money printing failed to provide a meaningful boost to aggregate demand, but global trade has also been hampered by China's transition from an investment-led, smokestack economy to a model driven by consumption and services. 

As Goldman put it in May, "there are no other markets large and/or dynamic enough to offset a slowdown in China in the foreseeable future, and we forecast trade volumes to stabilize in the period to 2018."  This has been bad news for commodities as the following chart makes abundantly clear:

It's also bad news for the global mining industry which, as WSJ reports, borrowed "heavily" in anticipation of neverending Chinese demand. Here's more:

As forecasts predicting endless growth in China's appetite for raw materials became a matter of industry faith, mining companies borrowed extensively to build networks of pits, railway lines and port terminals. Megadeals abounded as a merger-and-acquisition frenzy took hold. Cheap borrowing costs, thanks to low global interest rates, fueled the splurge.

 

Now, as China's hunger for resources ebbs and mining companies' profits suffer amid falling commodity prices, those debts have become an albatross around the industry's neck. 

 

Amid a slump in Chinese share prices last week, metals such as copper and aluminum fell to near six-year lows. Iron ore at one point hit its weakest level for a decade.

 

"There's been a colossal misjudgment of future demand," said Dali Yang, professor of political science at the University of Chicago. "That long boom made it especially difficult for people to expect anything otherwise. Many bought the big story about urbanization, instead of thinking how things could go bad."

 

The world's largest mining companies by market value had accumulated nearly $200 billion in net debt by 2014, six times higher than a decade ago, according to consultancy EY, while their earnings only increased roughly two-and-a-half times. Large mining companies have written off roughly 90% of all the acquisitions they made since 2007, according to Citigroup Inc.

 

Even if top mining companies devoted all their earnings less investment spending to paying down debt, it would take up to a decade to clear the decks, according to a Wall Street Journal analysis of EY data.

 

Mining companies cut big project spending recently, but many still face the decision to reduce dividends to shareholders, or borrow more to keep funding high payouts, risking downgrades to their credit ratings that would drive up interest costs—even as they still need to spend to shore up aging mines. "Something has to give," said EY's global mining leader, Mike Elliott.

 

An old-fashioned gold-rush mentality underpinned the mining sector's debt binge. The logic was simple. As China's economy grew, and more Chinese people moved from villages to cities, the country would need ever-increasing amounts of metals—particularly the steelmaking ingredient iron ore—to build homes, office buildings and other infrastructure.

 

"Analysts are popularly criticized for ?thesis creep, the incremental mutation of a call's drivers over time, such that it's not really clear that the original call was just plain wrong," said Morgan Stanley mining analyst Tom Price. "I suspect the same thing's happened here with the Big Mining's view on China's iron ore."

This serves as still more evidence of how central bank policy, ostensibly designed to stoke inflation and save the world from a brush with the deflationary boogeyman, has ironically served to perpetuate the global deflationary supply glut, a dynamic we've outlined on a number of occasions this year, but which found perhaps its most unequivocal expression in "When QE Leads To Deflation: A Look At The Confounding Global Supply Glut." Here's what we said in April:

Those who have access to easy money overproduce but unfortunately, they do not witness a comparable increase in demand from those to whom the direct benefits of ultra accommodative policies do not immediately accrue. Meanwhile, governments are reluctant to spend in the face of heavy debt burdens and increased scrutiny on fiscal policy in the wake of the European debt crisis while China, that all important source of voracious demand, is in the midst of executing the dreaded "hard landing.

Rock-bottom borrowing costs and easy access to capital markets made possible by accommodative central bank policies tempt insolvent producers to keep producing, contributing to their own demise by driving prices even lower, a vicious circle which creates Matt King's dreaded "zombie companies":

And finally, in an effort to connect all the dots, we'll close with the following from Credit Suisse, who notes that another theme we've been keen to emphasize lately is in fact serving to exacerbate sluggish demand for the world's commodities surplus:

Three years on from commodity price peaks and we are still searching for the floor in bulks pricing, let alone any recovery. This is not the usual bust after a mining boom, but the down-half of the supercycle. Rather than a couple of excess mines, the entire iron ore and coal sectors are geared towards growth that has gone missing. For the rest of the metals, with China's demand drive cooling, we have to return to looking at global growth. Unfortunately, money supply is contracting, with governments running austerity budgets and corporates returning cash to investors. Commodity consumption cannot grow when investment is spurned.

Latest bailout of Greece piles debt on unpayable debt, Turk tells KWN

Posted: 13 Jul 2015 05:53 PM PDT

8:50p ET Monday, July 13, 2015

Dear Friend of GATA and Gold:

More debt on top of the debt it already can never repay is no solution for Greece, GoldMoney's James Turk tells King World News tonight, adding that since the latest bailout is all conjured money, it will only devalue the currency of the lenders. The comments made by Turk, a GATA consultant, are excerpted at the KWN Internet site here:

http://kingworldnews.com/greek-tragedy-coming-to-a-bank-near-you-as-tsip...

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.


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http://cambridgehouse.com/event/50/the-silver-summit-and-resource-expo-2...

Support GATA by purchasing recordings of the proceedings of the 2014 New Orleans Investment Conference:

https://jeffersoncompanies.com/landing/2014-av-powell

Or by purchasing DVDs of GATA's London conference in August 2011 or GATA's Dawson City conference in August 2006:

http://www.goldrush21.com/order.html

Or by purchasing a colorful GATA T-shirt:

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Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

http://gata.org/node/wallstreetjournal

Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

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To contribute to GATA, please visit:

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MineWeb's Lawrence Williams: GATA's evidence of gold-price suppression is 'conclusive'

Posted: 13 Jul 2015 05:45 PM PDT

8:45p ET Monday, July 13, 2015

Dear Friend of GATA and Gold:

GATA's evidence that central banks and their bullion bank agents are suppressing the gold price is "conclusive," MineWeb's Lawrence Williams writes tonight.

"GATA's arguments," Williams writes, "have been treated with scorn by the gold-sector establishment for the most part and by the mainstream media, although its arguments do seem to be being taken a little more seriously by the latter more recently. Scorn and contempt have always been the weapons the establishment has employed to try to suppress unwelcome fact and theory."

Williams' commentary is headlined "Gold Price Manipulation: Who Really Calls the Tune?" and it's posted at MineWeb here:

http://www.mineweb.com/news/gold/gold-price-manipulation-who-really-call...

Williams' tin-foil hat with first gold nugget cluster is in the mail.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.


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The Silver Summit and Resource Expo 2015
Hyatt Regency Hotel, San Francisco
Monday-Tuesday, November 23-24, 2015

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Support GATA by purchasing recordings of the proceedings of the 2014 New Orleans Investment Conference:

https://jeffersoncompanies.com/landing/2014-av-powell

Or by purchasing DVDs of GATA's London conference in August 2011 or GATA's Dawson City conference in August 2006:

http://www.goldrush21.com/order.html

Or by purchasing a colorful GATA T-shirt:

http://gata.org/tshirts

Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

http://gata.org/node/wallstreetjournal

Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

http://www.gata.org

To contribute to GATA, please visit:

http://www.gata.org/node/16

Gold Daily and Silver Weekly Charts - 'Peace In Our Time'

Posted: 13 Jul 2015 01:57 PM PDT

Understanding the Financial Crisis in Greece

Posted: 13 Jul 2015 12:30 PM PDT

In which John Green discusses the history of Greece's deficit and debt problems, the challenges of adopting the Euro and living with the Eurozone's monetary policy, and the possibility of the so-called Grexit--a Greek exit from the Euro. The Financial Armageddon Economic Collapse Blog...

[[ This is a content summary only. Visit http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]

What Happens If A Country Goes Bankrupt?

Posted: 13 Jul 2015 12:00 PM PDT

Many countries have been almost or completely bankrupt in recent history with Greece now on the brink of bankruptcy. So, what happens when countries go bankrupt? The Financial Armageddon Economic Collapse Blog tracks trends and forecasts , futurists , visionaries , free investigative...

[[ This is a content summary only. Visit http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]

Greece and the End of the Euroland Fantasy

Posted: 13 Jul 2015 11:47 AM PDT

This post Greece and the End of the Euroland Fantasy appeared first on Daily Reckoning.

The one undeniable truth about the debt drama in Greece is that each of the conventional narratives—financial, political and historical—has some claim of legitimacy.

For example, spendthrift Greeks shunned fiscal discipline: here's an account from 2011 that lays out the gory details: The Big Fat Greek Gravy Train: A special investigation into the EU-funded culture of greed, tax evasion and scandalous waste.

Or how about: Greek reformers want to fix the core structural problems but are being stymied by tyrannical European Union/Troika leaders: The Greek Debt Crisis and Crashing Markets.

Rather than get entangled in the arguments over which of the conventional narratives is the core narrative—a hopeless misadventure, given that each narrative has some validity— let's start with the facts that are supported by data or public records, and move to the inevitable consequences of those facts.

Events in Greece are not just a template for sovereign debt crises to come; they also spell the end of the Euroland Fantasy of ever-greater prosperity as a result of ever-greater centralization and integration of European nation-states, economies, fiscal policies, banking, trade and currencies.

The Greek Economy Is Small and Imbalanced

Here are the basics of Greece's economy, via the CIA's World Factbook:

Greece’s population is 10.8 million and its GDP (gross domestic product) is about $200 billion (This source states the GDP is 182 billion euros or about $200 billion).

Note that the euro fell sharply from $1.40 in 2014 to $1.10 currently, so any Eurozone GDP data stated in dollars has to be downsized accordingly. Many sources state Greek GDP was $240 billion in 2013; adjusted for the 20% decline in the euro, this is about $200 billion at today's exchange rate.

  • Los Angeles County, with slightly more than 10 million residents, has a GDP of $554 billion, more than double that of Greece.
  • The European Union has over 500 million residents. Greece’s population represents 2.2% of the EU populace.
  • External debt (public and private debt owed to lenders outside Greece):
  • $568.7 billion (30 September 2013 est.)
  • National debt: 339 billion euros, $375 billion
  • Central Government Budget: revenues: $119.5 billion/expenditures: $127.9 billion (2014 est.)
  • Budget surplus (+) or deficit (-): -3.4% of GDP (2014 est.)
  • Public debt: 174.5% of GDP (2014 est.)
  • Labor force: 3.91 million (2013 est.)
  • GDP – per capita (Purchasing Power Parity): $25,800 (2014 est.)
  • Unemployment rate: 26.8% (2014 est.)
  • Exports: $35.8 billion (2014 est.)
  • Imports: $62.8 billion (2014 est.)
  • Imports – partners: Russia 14.1%, Germany 9.8%, Italy 8.1%, Iraq 7.8%, France 4.7%, Netherlands 4.7%, China 4.6% (2013)
  • Reserves of foreign exchange and gold: $6.433 billion (February 2015 est.)
  • By 2013 the economy had contracted 26%, compared with the pre-crisis level of 2007. Tourism provides 18% of GDP.

What can we conclude from this data?

  1. Greece's central government is roughly half of its GDP (by some measures, it's 59%), meaning that the national economy is heavily dependent on state revenues and spending.  For context, U.S. government spending is about 20% of U.S. GDP. As a rule of thumb, the private sector must generate the wealth that pays taxes and supports state spending. This leaves a relatively small private sector with the task of generating enough wealth to support state spending, pay interest on the national debt and pay down the principal.
  2. Greece runs a trade deficit, i.e. a current account deficit of almost $30 billion annually.  In the 14 years that Greece has been an EU member, this adds up to roughly $400 billion—a staggering sum for a nation with a GDP of around $200 billion.
  3. Austerity and a reduction in borrowing/spending have devastated the Greek economy, as GDP has shrunk 26% while unemployment has soared to 26%.
  4. While public debt is pegged at 175% of GDP, external debt is roughly 285% of GDP—a much larger sum. By all accounts, a significant portion of the Greek economy is off-the-books (cash); even if this is counted, the debt load on the private sector is extremely high.
  5. Foreign exchange reserves and gold holdings are a tiny percentage of government spending and GDP.

This data reflects an imbalanced, heavily indebted, heavily state-centric economy with major systemic headwinds.

The Problem with Not Having a National Currency

The problem with not having a national currency is that there is no mechanism to rebalance trade (current account) imbalances.

Ideally, a nation's exports and imports balance, but in the real world, nations generally run trade surpluses or deficits. A trade deficit is a negative balance of trade incurred when a country’s imports exceed its exports. A trade deficit is settled by an outflow of domestic currency to foreign markets.

Countries with trade surpluses end up with cash from their trading partners, while countries with trade deficits must pay the difference between their exports and imports.

Trade must balance: every nation cannot run a trade surplus. The problem for nations with current account deficits is: where do they get the money to settle their negative balance of trade?

Nations with their own currencies can simply create the money out of thin air. This is in essence how the U.S. supports its massive trade deficits: the U.S. imports goods and services and exports U.S. dollars in exchange for the goods and services.

This works as long as the country running trade deficits doesn't print its currency with abandon.

If a nation prints its currency in excess, the currency loses value, and imports become more costly to residents.  As imports rise in cost (priced in the local currency), people can't afford as many imports as they once could, and imports decline, reducing the trade deficit.

On the other side of the trade ledger, the exports of the nation that is depreciating its currency becomes cheaper in other currencies. This makes the nation's exports a relative bargain, and this tends to increase exports as global buyers take advantage of the cheaper goods and services.

In this way, national currencies provide a mechanism for rebalancing trade deficits. By eliminating national currencies, the Eurozone also eliminated the only market mechanism for rebalancing trade imbalances.

With no currency mechanism left, nations borrow money to fund their trade deficit.  This is the engine of Greek debt since that nation adopted the euro in 2001.

If Greece had kept its national currency, trade deficits would have declined as the Greek currency depreciated and the cost of imports soared. Lenders would not have based their loans on the illusory guarantee of Eurozone membership.

For nations running large structural trade deficits, membership in the Eurozone was a guarantee of financial disaster, as the way to fund the deficit within the Eurozone was to borrow more money.

There is no way for Greece to fix its debt problem if it keeps the euro as its currency.  Every purported solution that doesn't address the core cause of the debt is mere theater.

The Subprime Template

In the subprime mortgage bubble of the mid-2000s, people with modest incomes were able to buy costly McMansions under false pretenses by exaggerating their income (via "stated income" or liar loans).

The mortgage originators issued the mortgage under equally false pretenses—that there was proper risk assessment/due diligence and a fair appraisal value for the property.

These false pretenses enabled unqualified buyers to borrow enormous sums—for example, someone with an actual annual income of $25,000 borrowed $500,000 with no down payment and very low initial rate of interest.

While the borrower bought into the dream of get-rich-quick "house flipping," the real money was made by the originator and the lender.

It is widely accepted that Greece was admitted to the Eurozone under false pretenses—national debts were masked or understated, reportedly with the assistance of Goldman Sachs.

That a few at the top of the political/financial heap gained from Greece's entry into the Eurozone is demonstrated by the "Lagarde List" of 2,000 individuals who transferred 50 billion euros out of Greece to Swiss banks in 2010, when the debt crisis was first making headlines.

These are clearly not middle-class households getting their assets out of risky Greek banks; these are oligarchs and the top .1%. (Source)

Since these transfers do not include money that fled Greece into the shadow banking system or hard assets, we can estimate the total sum taken out of Greece by the top 2,000 is more on the order of 100 billion euros—roughly half the nation's GDP.

In the U.S. economy, this would translate to 60,000 households taking $8.5 trillion out of the U.S.

It is also widely accepted that at best 10% of the bailout funds trickled down to the Greek people—the vast majority bailed out private banks and other lenders. (Source)

These charts demonstrate how private loans to Greece have been transferred wholesale to the public ledger, i.e. taxpayers:
privatecred

taxpayers

This is roughly the same template the too big to fail banks followed in the subprime mortgage crisis: after skimming vast profits from originating the loans, the banks faced insolvency as the phantom collateral of subprime mortgages evaporated.

To rescue the financial markets, the federal government bailed out the banks.

Faced with the prospect of a Greek default bringing down their over-leveraged banking sector (i.e. the European equivalent of a "Lehman Moment"), the EU leadership opted to bail out their own too big to fail banks on the backs of their taxpayers.

Two Conclusions

There are two conclusions to be drawn from all this, and they have nothing to do with who is demonizing whom or the political theater currently being staged:

  1. Greece can never escape the cycle of increasing debt until it exits the euro and returns to a national currency.
  2. The debt is so outsized compared to Greece's private sector that it must be written off. What cannot be paid will not be paid.

These facts matter not only because contagion from Greek debt defaults may ripple in dangerous ways through the financial system, but because they are also true for many other members of the Eurozone.

As I predicted in my first article for Peak Prosperity four years ago, the Euro is a fatally-flawed monetary concept and what we now seeing playing out was eminently predictable from the start.

In Part 2: More Sovereign Defaults Are Coming – Prepare Ahead Of The Turmoil, we look at structural causes of the global debt crisis that are not limited to Greece.

Many other countries are teetering on the same brink Greece is now falling off of. When they fail, the ripple effect their debt defaults will debilitate their creditor nations, causing a massive shrinking of the world economy.

The key takeaway is this: even if the countries we live in can’t live sensibly and within their means, we as individuals have the power to do so. But we need to seize that power now, before the next crisis arrives, for it to matter.

Regards,

Charles Hugh Smith
for The Daily Reckoning

P.S. Ever since my first summer job decades ago, I've been chasing financial security. Not win-the-lottery, Bill Gates riches (although it would be nice!), but simply a feeling of financial control. I want my financial worries to if not disappear at least be manageable and comprehensible.

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You don't have to be a financial blogger to know that "having a job" and "having a career" do not mean the same thing today as they did when I first started swinging a hammer for a paycheck.

Even the basic concept "getting a job" has changed so radically that jobs–getting and keeping them, and the perceived lack of them–is the number one financial topic among friends, family and for that matter, complete strangers.

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The post Greece and the End of the Euroland Fantasy appeared first on Daily Reckoning.

Greece Today, America Tomorrow?

Posted: 13 Jul 2015 11:21 AM PDT

This post Greece Today, America Tomorrow? appeared first on Daily Reckoning.

Editor’s Note: Dr. Paul has written a brand-new book entitled Swords Into Plowshares. In it, he shares a very personal story of his formative years spent in wartime. What was it like growing up in the shadow of World War II and living through the many wars that followed? Dr. Paul has the prescription, click here now to reserve your copy!

The drama over Greece's financial crisis continues to dominate the headlines. As this column is being written, a deal may have been reached providing Greece with yet another bailout if the Greek government adopts new "austerity" measures. The deal will allow all sides to brag about how they came together to save the Greek economy and the European Monetary Union. However, this deal is merely a Band-Aid, not a permanent fix to Greece's problems. So another crisis is inevitable.

The Greek crisis provides a look into what awaits us unless we stop overspending on warfare and welfare and restore a sound monetary system. While most commentators have focused on Greece's welfare state, much of Greece's deficit was caused by excessive military spending. Even as its economy collapses and the government makes (minor) cuts in welfare spending, Greece's military budget remains among the largest in the European Union.

Despite all the handwringing over how the phony sequestration cuts have weakened America's defenses, the United States military budget remains larger than the combined budgets of the world's next 15 highest spending militaries. Little, if any, of the military budget is spent defending the American people from foreign threats. Instead, the American government wastes billions of dollars on an imperial foreign policy that makes Americans less safe. America will never get its fiscal house in order until we change our foreign policy and stop wasting trillions on unnecessary and unconstitutional wars.

Excessive military spending is not the sole cause of America's problems. Like Greece, America suffers from excessive welfare and entitlement spending. Reducing military spending and corporate welfare will allow the government to transition away from the welfare state without hurting those dependent on government programs. Supporting an orderly transition away from the welfare state should not be confused with denying the need to reduce welfare and entitlement spending.

On reason Greece has been forced to seek bailouts from its EU partners is that Greece ceded control over its currency when it joined the European Union. In contrast, the dollar's status as the world's reserve currency is the main reason the US has been able to run up huge deficits without suffering a major economic crisis. The need for the Federal Reserve to monetize ever-increasing levels of government spending will eventually create hyperinflation, which will lead to increasing threats to the dollar's status. China and Russia are already moving away from using the dollar in international transactions. It is only a matter of time before more countries challenge the dollar's reserve currency status, and, when this happens, a Greece-style catastrophe may be unavoidable.

Despite the clear dangers of staying on our recent course, Congress continues to increase spending. The only real debate between the two parties is over whether we should spend more on welfare or warfare. It is easy to blame the politicians for our current dilemma. But the politicians are responding to demands from the people for greater spending. Too many Americans believe they have a moral right to government support. This entitlement mentally is just as common, if not more so, among the corporate welfare queens of the military-industrial complex, the big banks, and the crony capitalists as it is among lower-income Americans.

Congress will only reverse course when a critical mass of people reject the entitlement mentality and understand that the government is incapable of running the world, running our lives, and running the economy. Therefore, those of us who know the truth must spread the ideas of, and grow the movement for, limited government, free markets, sound money, and peace.

Regards,

Ron Paul
for The Daily Reckoning

Editorial Note: Dr. Paul has written a brand-new book entitled Swords Into Plowshares. In it, he shares a very personal story of his formative years spent in wartime. What was it like growing up in the shadow of World War II and living through the many wars that followed? Dr. Paul has the prescription, click here now to reserve your copy!

The post Greece Today, America Tomorrow? appeared first on Daily Reckoning.

Jim’s Mailbox

Posted: 13 Jul 2015 10:36 AM PDT

Jim, This could possibly border on racism. Gold associated with "Black Money", whereas Paper Gold associated with "white money"? Seriously though, what I buy with the money I've earned, is my business. Gold or otherwise. There is no inherent harm in storing my earnings in gold in lieu of financial casinos. I don't hear any... Read more »

The post Jim’s Mailbox appeared first on Jim Sinclair's Mineset.

Greece surrenders its sovereignty -- but should it have expected otherwise?

Posted: 13 Jul 2015 10:30 AM PDT

Greece Is Being Treated Like a Hostile Occupied State

By Ambrose Evans-Pritchard
The Telegraph, London
Monday, July 13, 2015

Like the Neapolitan Bourbons -- benign by comparison -- the leaders of the eurozone have learned nothing, and forgotten nothing.

The cruel capitulation forced upon Greece after 31 hours on the diplomatic rack offers no conceivable way out the country's perpetual crisis. The terms are harsher by a full order of magnitude than those rejected by Greek voters in a landslide referendum a week ago, and therefore can never command democratic assent.

... Dispatch continues below ...


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They must be carried through by a Greek parliament still dominated by MPs from Left and Right who loathe every line of the summit statement, the infamous SN 4070/15, and have agreed -- if they have agreed -- only with a knife to their throats.

EMU inspectors can veto legislation. The emasculation of the Greek parliament has been slipped into the text. All that is missing is a unit of EMU gendarmes.

Such terms are unenforceable. The creditors have sought to nail down the new memorandum by transferring E50 billion of Greek assets to "an independent fund that will monetise the assets through privatisations and other means." It will be used in part to pay off debts.

This fund will be under EU "supervision." The cosmetic niceties of sovereignty will be preserved by letting the Greek authorities manage its day-to-day affairs. Nobody is fooled. ...

... For the remainder of the commentary:

http://www.telegraph.co.uk/finance/economics/11736779/Greece-is-being-tr...


* * *

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TF Metals Report interviews First Majestic Silver's Keith Neumeyer

Posted: 13 Jul 2015 10:13 AM PDT

1:10p ET Monday, July 13, 2015

Dear Friend of GATA and Gold:

The TF Metals Report's Turd Ferguson today interviews First Majestic Silver CEO Keith Neumeyer, founder and sole member of the International Association of Monetary Metals Mining Company Executives Who Are Not Clueless. (Anyway, he might as well be.) Along with developments at First Majestic, Neumeyer discusses a mine finance company he has started with Eric Sprott, Rick Rule, and others; his call for silver miners to withhold production to combat price suppression by derivatives mongers; his recent appeal to the U.S. Commodity Futures Trading Commission; and changes in the derivatives system that would be necessary to restore free markets.

The interview is 28 minutes long and can be heard at the TF Metals Report's Internet site here:

http://www.tfmetalsreport.com/podcast/6992/conversation-keith-neumeyer-f...

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.


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Greece remains broke and world debt is still unsupportable, Embry tells KWN

Posted: 13 Jul 2015 10:02 AM PDT

1p ET Monday, July 13, 2015

Dear Friend of GATA and Gold:

Greece's apparent capitulation to its European creditors changes nothing about the country's inability to pay its debts, Sprott Asset Management's John Embry tells King World News today, adding that debt is unsupportable all around the world. An excerpt from the interview is posted at the KWN blog here:

http://kingworldnews.com/greece-caves-but-whats-happening-in-china-will-...

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.


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Regime Change!

Posted: 13 Jul 2015 09:53 AM PDT

This post Regime Change! appeared first on Daily Reckoning.

This week looks like kicking off where last week started. That is, with China and Greece front and centre. Greece and Europe look increasingly like they will implode. More on that in a moment.

Firstly, I want to tell you about something else going on in the world that no one is really looking at right now.

On Friday, the Shanghai Cooperation Council (SCC) welcomed India and Pakistan through its doors. They join founding members China and Russia as well as a host of central Asian countries. The admissions took place in the Russian city of Ufa, at a summit hosted by Vladimir Putin.

As the Financial Times reports, the council is a 'forum for security talks and economic integration spanning a vast geographic area in which neither the US nor the EU has substantial influence, but which includes several countries of global strategic significance.'

In a time of waning US dominance on the global stage, evidenced by a disintegrating Middle East, the emergence of the SCC is a significant development.

When you're subject to the western media's relentless 48 hour news cycle, it's sometimes hard to take a step back and look at the bigger picture forces unfolding in the global economy. But give it a moment's thought and you can see how the vast bloc of 'emerging' economies are slowly beginning to galvanise and demand a different economic path to that proscribed by the West.

That path is one dominated by a stranglehold over global monetary policy and the global institutions that make up and support the 'system'. In effect, this system acts as a tax on the rest of the world, with the receipts flowing to the US via the process of seigniorage (which allows the US to pay for goods and services with near costless printed money).

This is what has allowed the US to run massive trade and current account deficits for decades. When you manage the global reserve currency, the world extends you many meters of rope with which to eventually hang yourself.

It's this global system that countries like China and Russia are tiring off. They know they are not strong enough to bring about rapid change. So they are joining forces in their own economic bloc with the hope of destabilising the foundations of the current world economic order.

Jim Rickards, editor of Strategic Intelligence, thinks the solution to the problem is the 'SDR'. This is a supranational currency called a 'special drawing right'. Created in 1969, the International Monetary Fund (IMF) administers it.

In the next six months, the IMF are set to change its composition, likely admitting China's yuan into the basket of currencies that currently include the US dollar, the euro, the yen and the pound.

Rickards soon thinks these SDRs will have more prominence in the international financial system, eventually replacing the US dollar and the world's reserve 'currency'. Here's a sneak peek from Rickards' forthcoming issue:

'Individuals won't have SDRs. Only countries will have them in their reserves. These countries have no desire to break the new SDR system, because they're all in it together. The US is no longer the boss. Instead, you have the "Five Families" consisting of China, Japan, the US, Europe and Russia operating through the IMF.

'The only losers are the citizens of the IMF member countries — people like you and I — who will suffer local currency inflation. I'm preparing with gold and hard assets, but most people will be caught unaware, like the Greeks who lined up at empty ATMs last month.'

A great example of the demise of western institutions is what's going on in Europe right now. The currency union is turning out to be a disaster. Europe is tearing itself apart in the same way that it did 100 years ago. Socially and financially, the implications could be profound.

Germany is again the protagonist. Instead of offering Greece debt relief in exchange for reforms, it's playing hardball. And it's hard to tell what game Greece is playing at all.

Following last week's referendum and 'no' to austerity vote, the Greek parliament voted for more austerity on Friday evening. It turns out the call for a referendum and imposition of capital controls was a failed gambit on Greece's behalf.

Having followed the story on Twitter over the weekend, I learnt that Greece hasn't even made preparations to exit the Eurozone and return to the drachma. They have, and had, no Plan B.

Greece's ex-finance minister Yanis Varoufakis wrote a scathing op-ed piece in the UK's Guardian over the weekend. He hinted at the enormity of preparing the country for a new currency in a short amount of time:

'To exit, we would have to create a new currency from scratch. In occupied Iraq, the introduction of new paper money took almost a year, 20 or so Boeing 747s, the mobilisation of the US military's might, three printing firms and hundreds of trucks. In the absence of such support, Grexit would be the equivalent of announcing a large devaluation more than 18 months in advance: a recipe for liquidating all Greek capital stock and transferring it abroad by any means available.'

On top of this Prime Minister Alexis Tsipras says he doesn't have a mandate to exit the Eurozone. Greece's bargaining power resided in the threat of a credible exit. Now that it's apparent the threat is no longer credible, Greece is at the mercy of its creditors.

France and others want some sort of compromise. Germany is all stick and no carrot. They want Greece to agree to tough reforms before agreeing to another bailout. This is despite the fact that tough reforms have done nothing to get Greece back on the path to sustainable growth.

Without some debt forgiveness, it simply won't happen. But according to Varoufakis, debt restructuring has never been on the agenda:

'In my first week as minister for finance I was visited by Jeroen Dijsselbloem, president of the Eurogroup (the eurozone finance ministers), who put a stark choice to me: accept the bailout's "logic" and drop any demands for debt restructuring or your loan agreement will "crash" – the unsaid repercussion being that Greece's banks would be boarded up.'

Germany seems intent on breaking the Eurozone apart, or at least breaking Greece as a message to others not to follow the same path. This is simply coercion and economic dominance without military support.

The euro elite has lost the plot. What they're doing should be condemned the world over. Instead, it's Greece copping the brunt of it. Perhaps it simply comes down to political ideology as Phil Anderson, editor of Australia’s Cycles, Trends and Forecasts, pointed out in an update to his subscribers last week.

'The Greek events presently are a play between right wing and left wing ideology. I can assure you, if the current Greek government had been far more right-wing, or a monarchy, the troubles would have been sorted and done by now.

'History is unequivocal on this.

'Since 1917, any left-wing government that has taken power democratically (or not), especially devoutly communist, attracts immediate attention from the US and (now) NATO nations.'

Perhaps the end game is regime change? That's the only way to maintain the elite's stranglehold on power. No wonder the West is losing the plot in the eyes of the world.

Sit up and take notice, dear reader, we are entering into a very volatile historical period.

Regards,

Greg Canavan
for The Daily Reckoning, Australia

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The post Regime Change! appeared first on Daily Reckoning.

Bron Suchecki: The Texas bullion depository is not a joke

Posted: 13 Jul 2015 08:56 AM PDT

11:55a ET Monday, July 13, 2015

Dear Friend of GATA and Gold:

While mainstream financial news organizations are making fun of it, the bullion depository planned by Texas will probably be a good and profitable business and increase interest in investing in gold, Perth Mint research director Bron Suchecki writes today. His commentary is headlined "The Texas Bullion Depository Is Not a Joke" and it's posted at the Perth Mint's Internet site here:

http://research.perthmint.com.au/2015/07/13/the-texas-bullion-depository...

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.


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The Silver Summit and Resource Expo 2015
Hyatt Regency Hotel, San Francisco
Monday-Tuesday, November 23-24, 2015

http://cambridgehouse.com/event/50/the-silver-summit-and-resource-expo-2...

Support GATA by purchasing recordings of the proceedings of the 2014 New Orleans Investment Conference:

https://jeffersoncompanies.com/landing/2014-av-powell

Or by purchasing DVDs of GATA's London conference in August 2011 or GATA's Dawson City conference in August 2006:

http://www.goldrush21.com/order.html

Or by purchasing a colorful GATA T-shirt:

http://gata.org/tshirts

Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

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Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

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To contribute to GATA, please visit:

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Gold Price Seasonal Tendencies for July 2015

Posted: 13 Jul 2015 08:11 AM PDT

“History doesn’t repeat itself but it rhymes” the saying goes. If this is in fact true, and what has happened before might imperfectly repeat itself in the future, this might be used in financial markets. But how to use it exactly? Is there a way to get clear indications as to what used to happen in the past to get a notion of what might come? It is frequently difficult to quantify past events in a meaningful way to get an idea of the possible future tendencies. At Sunshine Profits, we have come up with a methodology to look at the past and recognize tendencies that might repeat themselves in the future – we have developed a tool called True Seasonals to analyze this sort of patterns.

Greece Could Be A Template for U.S. State & Local Gov’t Debt Crises

Posted: 13 Jul 2015 08:03 AM PDT

This post Greece Could Be A Template for U.S. State & Local Gov’t Debt Crises appeared first on Daily Reckoning.

When you can’t pay your bills, you can either cut expenses, borrow money or if you’re extraordinarily privileged, print money.

If you borrow money without cutting expenses, the interest on the borrowed money piles up and you can’t pay that, either.

Then not only do you have a spending crisis, you have a debt crisis, and so do those who lent you the money.

Because the funny thing about borrowed money is it’s a debt to you but an asset to the lender.

Not only is your debt listed as an asset on the lender’s books–it’s collateral that supports whatever financial leverage the lender might engage in.

If you default on the debt, not only is the lender’s assets impaired–all his leveraged bets built on the collateral of your debt are suddenly impaired, too.

The preferred solution nowadays to a spending/debt crisis is to borrow your way out of the crisis: if you can’t pay the interest and debt that’s due, just borrow more to cover the interest payments and roll the old debt into new loans.

In a variation that we can call The Japanese Solution, the lender decides not to list your defaulted loan as impaired–he places your loan in a special zombie debt column–it’s neither a performing loan nor a defaulted loan; it is a zombie loan.

The other solution (again from Japan) is to roll the defaulted debt into new loans at near-zero rates of interest that allow the borrower to pay a nominal sum every month, just to maintain the illusion of solvency. If you owe the bank $10 million, the bank loans you $11 million at .01% rate of interest and you promise to pay $100 a month.

There–problem solved! The loan is now performing because the borrower is once again making payments. But is either the borrower or lender actually solvent? Of course not.

Another trick is to guarantee the borrower is solvent. It’s all smoke and mirrors, of course, but the empty guarantee is enough to smooth things over and maintain the illusion of solvency right up to the moment when the house of cards collapses.

Debt and all these tricks to mask insolvency are scale-invariant, meaning they work the same on household debt, corporate debt and national debt. Many of these scams were used to mask the subprime mortgage debacle, and they are being routinely applied to private and public debt.

Why?

To avoid the consequences of losses being forced on over-leveraged private banks and other lenders. Were those losses to be taken, those entities would be insolvent: their assets would be auctioned off, their shareholders, bond holders and creditors would receive pennies on the dollar (if that) and the lender would close their doors.

The losses to the Financial Aristocracy, pension funds, etc. would be immense. So rather than deal with the realities of an insolvent, over-leveraged, over-indebted and intrinsically corrupt financial system, everyone plays shadow games to maintain the illusion of solvency.

If you can’t print money or slash expenses, you have to borrow more money. The more you borrow, the greater the odds that in the next downturn, you won’t be able to pay your bills, the interest on the debt, and roll over debt coming due into new loans.

That’s the template not just for Greece, but for many state and local governments in the U.S. As Gordon Long and I discuss in GREECE: A US State & Local Template?, state and local governments share key characteristics with Greece: they have soaring pension, Medicaid and employee healthcare obligations, but their tax revenues are either stagnant or prone to boom and bust cycles–and the current boom cycle is now entering the inevitable bust phase, when tax revenues plummet but the obligations just keep piling up.

The template of over-indebtedness as a response to soaring obligations is scale-invariant, and it always ends the same way: default, more financial tricks to mask the default, and eventually, insolvency, bankruptcy and massive losses being distributed to everyone foolish enough to choose financial trickery over dealing with reality back when the pain would have been bearable.

As for printing your way out of a spending/debt crisis: that’s just another form of financial trickery that keeps the illusion alive for a few more years.

Watch the video, “Greece: A U.S. State & Local Template?” with Gordon T. Long, below.

Regards,

Charles Hugh Smith
for The Daily Reckoning

P.S. Ever since my first summer job decades ago, I've been chasing financial security. Not win-the-lottery, Bill Gates riches (although it would be nice!), but simply a feeling of financial control. I want my financial worries to if not disappear at least be manageable and comprehensible.

And like most of you, the way I've moved toward my goal has always hinged not just on having a job but a career.

You don't have to be a financial blogger to know that "having a job" and "having a career" do not mean the same thing today as they did when I first started swinging a hammer for a paycheck.

Even the basic concept "getting a job" has changed so radically that jobs–getting and keeping them, and the perceived lack of them–is the number one financial topic among friends, family and for that matter, complete strangers.

So I sat down and wrote this book: Get a Job, Build a Real Career and Defy a Bewildering Economy.

It details everything I've verified about employment and the economy, and lays out an action plan to get you employed.

I am proud of this book. It is the culmination of both my practical work experiences and my financial analysis, and it is a useful, practical, and clarifying read.

The post Greece Could Be A Template for U.S. State & Local Gov’t Debt Crises appeared first on Daily Reckoning.

Silver Bullion Demand High – Price Falls and Premiums Surge

Posted: 13 Jul 2015 06:46 AM PDT

- Silver imports into U.S. surge 33% - Silver Eagle demand very robust - Silver Eagles and Maples see 25% surge in premiums and shortages - Silver price falls over 3.8% on same day as U.S. Mint runs out of silver eagles - Total ETF Silver holdings remain robust – over 500 million ounces - Increase in demand seems to becoming from large entities buying bars - Silver is great value sub $20 per ounce

Rand Refinery commentary cites gold market manipulation on Comex

Posted: 13 Jul 2015 05:32 AM PDT

8:30a ET Monday, July 13, 2015

Dear Friend of GATA and Gold:

The weekly gold market commentary written by David Levenstein of Lakeshore Trading in Rivonia, South Africa, and published today by the Rand Refinery in Germiston, South Africa, which claims to be the largest gold refining and smelting operation in the world, cites manipulation of the market "by bullion banks using Comex."

Levenstein writes: "Once again investors remain perplexed about the price action of gold, especially after Greece defaulted on its debt owed to the International Monetary Fund and imposed bank closures and capital controls amid its debt crisis. It seems the reasons for this have been the strong dollar, which many investors have turned to as a safe haven, and the apparent price manipulation by bullion banks using Comex."

Many investors may also be perplexed by the failure of gold mining and refining interests in South Africa and the South African government to do anything about this market manipulation. If they need any ideas about that, they can contact your secretary/treasurer.

The Rand Refinery commentary is posted at the company's Internet site here --

http://www.randrefinery.com/newsletters/RRL_Weekly_Gold_Report_20150713....

-- and at GATA's Internet site here:

http://www.gata.org/files/RandRefineryCommentary-07-13-2015.pdf

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org


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Or by purchasing DVDs of GATA's London conference in August 2011 or GATA's Dawson City conference in August 2006:

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Or by purchasing a colorful GATA T-shirt:

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Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

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Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

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To contribute to GATA, please visit:

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The Potemkin Bank of China

Posted: 13 Jul 2015 04:05 AM PDT

In the midst of an intense global economic slowdown that began in 2008, China's economy amazingly appeared to be unaffected. Defying the world-wide real estate collapse, China's GDP grew by an impressive 8.7% in 2009. Fueled initially by a $586 billion stimulus package, China would end up plowing and additional $20 trillion dollars into a fixed asset bubble that was designed to produce the government's desired GDP print.

Gold, Silver and the Two Horsemen of The Apocalypse

Posted: 13 Jul 2015 04:02 AM PDT

If we can reassign meanings given to the biblical Four Horsemen of the Apocalypse from the original, we can then say financial markets saw two of them this week. The first brought us the Greek Crisis which went from very bad to impossible to resolve, and the second was a collapsing stock market in China. Between them these two events triggered another flight into the US dollar, which would have been far worse without central bank intervention. With the dollar rising against the euro, commodity prices, particularly energy and oil, have fallen sharply, with US Crude down over 15% in the last month.

Gold Price Peculiar 6 Month Cycles

Posted: 13 Jul 2015 03:56 AM PDT

In this report I'm going to show you some more of the same precious metals stocks we've been following as more are joining the impulse move to the downside adding confirmation. Unlike the US stocks markets that have been trading sideways since the December high of last year, the precious metals stocks are in a confirmed impulse move down and that's where the real money is made.

Nine Companies Brent Cook Expects to See on the Other Side of the Gold Market Wasteland

Posted: 13 Jul 2015 01:00 AM PDT

Markets are cyclical and even though it feels like the end of the world after years of junior resource stock market declines, history indicates that bear markets are actually an opportunity to own tomorrow's superstars for pennies on the dollar. In this interview with The Gold Report, market veteran and Exploration Insights author Brent Cook shares his travel stories and the companies he thinks will shine when the sun returns to commodity prices.

Silver Price Remains in Long-term Downtrend

Posted: 12 Jul 2015 09:11 PM PDT

It's a strange situation - the long-term charts for silver continue to look awful, but there has been a quite dramatic improvement in its COTs, which now look positive, with readings that in the past have consistently lead to rallies. However, this doesn't mean that any rally that develops soon will succeed in breaking silver out of its long downtrend. Silver's 8-year chart shows the as yet unrelenting downtrend from its 2011 highs involving a classic "staircase" decline. On this chart it looks set to drop again, but perhaps after another rally first towards the upper boundary of the downtrend channel.

Gold Price Awaiting Outcome of Greece Crisis

Posted: 12 Jul 2015 09:08 PM PDT

The situation is paradoxical - the charts of just about everything are positioned for a plunge - or a turnaround and limited recovery, which reflects the fact that markets are waiting on some sort of resolution of the standoff with Greece, either Greece walking away, a Grexit, or a fudge solution where Greece accepts defeat and is denied debt relief or it is obfuscated sufficiently for the markets to buy it and this may involve another "can kicking" exercise. While the charts for many commodities look scary, including gold and silver, their COTs now look bullish, which suggests that the fudge solution will be the outcome.
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