Sunday, July 3, 2016

Gold World News Flash

Gold World News Flash

Gold, Silver Best Performing Assets In H1, 2016 – Up 26% and 38%

Posted: 03 Jul 2016 01:39 AM PDT

Gold, Silver Best Performing Assets In H1, 2016 – Up 26% and 38%

Gold and silver are the best performing assets in H1, 2016 and saw gains of 26% and 38% respectively. They were the best performing assets prior to Brexit and they are the best performing assets since Brexit. Gold and silver are up 6% and 11% respectively since the seismic Brexit vote led to turmoil on global markets.

Market Performance, H1, 2016 (

Global stocks had a torrid first half with European and Asian stocks coming under severe selling pressure. The Euro Stoxx 50 fell 10.4%. The Nikkei was down a whopping 17%, while the Shanghai A shares was down by even more – nearly 20 percent. U.S. shares remained elevated – largely due to continuing zero percent interest policies (ZIRP) by the Federal Reserve – contrary to all the speculative, nonsense talk of the Fed rising rates.

Gold and silver made gains due to continuing ultra loose monetary policies, diminished U.S. rate-increase expectations, worries about global economic growth, both U.S. and global geopolitical concerns and turmoil in markets at the start of Q1 and again at the end of Q2.

The UK decision to leave the EU has exacerbated these risks and highlighted them for complacent western speculators and investors who seemed blissfully unaware of the growing geopolitical and macroeconomic risks.

The case for gold and silver was already bullish prior to Brexit. Brexit is the "icing on the cake" and means that the fundamentals for gold and silver are arguably as good now as they have were in the early 1970s and the early 2000s.

The smart money knows this and this is seen in the likes of Soros, Dalio, Druckenmiller and many of the world's largest financial institutions and indeed insurance companies allocating to the financial insurance that is gold in recent months.

While Brexit is "icing on the cake" for the precious metals, for the financial system, it may be the proverbial "straw that breaks the camel's back."

The global financial and monetary system has all the appearances of a very old camel that is on its last legs. Copious amounts of drugs have been pumped into the camel in recent years which has prolonged its miserable life by a few years. But, they have not dealt with the substantive issue of the camel's very old age. Similarly we have not dealt with the substantive issue of a global financial system that is drowning in trillions and trillions of dollars, euros, pounds etc of debt – some $60 trillion of which has been created since 2008.

Brexit highlights the vulnerability of the Eurozone, the Eurozone banking system and the real potential for contagion in the global financial system.

There is the inconvenient truth that many European banks – French, Italian and Irish for example – remain woefully under capitalised and indeed are border line insolvent. It is not just banks in the unfortunate "PIIGS" that are vulnerable. A cursory glance of the share price of Germany's Deutsche Bank and Switzerland's Credit Suisse should give even the most complacent and 'Pollyannish', tunnel vision bull pause for concern.

The head of Germany's financial regulatory authority has sounded the alarm on the real risks Brexit poses to large German banks. Two banks cited as having the largest financial dealings in London are Deutsche Bank (NYSE:DB) and Commerzbank (OTC:CRZBY), with shares of Deutsche breaking to new all-time lows in recent days.

A British vote to leave the European Union would hit large German banks, given their heavy exposure to London, the head of German financial watchdog Bafin said in an interview with German newspaper Tagesspiegel as reported by Reuters. Bafin President Felix Hufeld told the newspaper that if there was a Brexit – "the biggest banks would have the biggest problems … they have the most activities in, and with, London," he said.

Both Deutsche and Credit Suisse have massive derivative books and exposure and the bankruptcy of either one could lead to the EU's 'Lehman moment.' Indeed, it could contribute to the collapse of the 'single' currency and indeed the global banking system. To those who say that this could not happen, it is worth remembering – lest we forget – that we came very, very close to that just eight short years ago.

Yet, the root cause of the initial crisis – insolvent banks and an insolvent world – has not been addressed since then. Indeed the financial position of banks and much of the western world today is arguably much worse than it was in 2008.

Gold and silver are reflecting the fact that we have a massive global financial bubble, especially in western bond markets and arguably in the U.S. stock market. This huge bubble is based on ultra loose monetary policies and the creation of currency to artificially support and pump up to record highs global bond markets. The bubble is beginning to unravel before our eyes.

The global financial system is a complete mess and the drum beat of bank bail-ins and currency devaluations grows louder by the day. Gold and silver have protected investors so far in 2016, as they have done throughout history and will do in the coming years.

Gold and Silver News
Gold holds overnight gains, heads for fifth weekly gain (Reuters)
Gold Advances for Fifth Week as Central Banks Poised for Easing (Bloomberg)
Gold bulls buoyed by prospect of Brexit swaying Fed (Reuters)
London gold trade agrees reforms to boost transparency (Reuters)
JPMorgan beats traders in silver futures rigging lawsuits (Reuters)

Gold Miners' Debt Hangover Eases as Bullion Gets Brexit Boost (Bloomberg)
Cheap Gold Mines Disappear as Buyers Splurge for Surging Bullion (Bloomberg)
British bonds go negative as Bank of England plans more money creation (FT via GATA)
Brexit won't hit global growth, but it does make one big difference (Money Week)
Brexit Fever Spreads: Austria and Holland are Next Up to Leave EU (Gold Seek)
Making The Case For $12,000 Gold And $360 Silver (Silver Seek)
Read More Here

Gold Prices (LBMA AM)
01 July: USD 1,331.75, EUR 1,199.51 & GBP 1,001.34 per ounce
30 June: USD 1,317.00, EUR 1,183.59 & GBP 976.82 per ounce
29 June: USD 1,318.00, EUR 1,191.64 & GBP 984.36 per ounce
28 June: USD 1,312.00, EUR 1,185.79 & GBP 985.84 per ounce
27 June: USD 1,324.60, EUR 1,200.49 & GBP 996.36 per ounce
24 June: USD 1,313.85, EUR 1,181.28 & GBP 945.58 per ounce
23 June: USD 1,265.75, EUR 1,112.22 & GBP 850.96 per ounce

Silver Prices (LBMA)
01 July: USD 19.24, EUR 17.29 & GBP 14.48 per ounce
30 June: USD 18.36, EUR 16.48 & GBP 13.61 per ounce
29 June: USD 18.21, EUR 16.42 & GBP 13.55 per ounce
28 June: USD 17.57, EUR 15.84 & GBP 13.17 per ounce
27 June: USD 17.70, EUR 16.06 & GBP 13.40 per ounce
24 June: USD 18.04, EUR 16.32 & GBP 13.18 per ounce
23 June: USD 17.29, EUR 15.16 & GBP 11.61 per ounce

Recent Market Updates
– BREXIT Day – Markets Becalmed – Gold Panic Prelude – Trading Hours
– Gold Lower Despite "Panic" Due To "Supply Issues" In Inter Bank Gold Market
– Gold Slips Despite UK Gold Demand Surging – Investors "Seek Stability"
– Gold Prices Surge to Highest in Nearly Two Years On FED and Brexit Haven Demand
– Gold Bullion Has Little Downside, Brexit Or Not, Says HSBC
– Central Bank of Ireland Warns Risks are Debt, Brexit, Geopolitical Tensions and Migration
– Gold In Euros Surges 6.5% In June and 17% YTD On BREXIT Concerns
– Soros Buying Gold On BREXIT, EU "Collapse" Risk
– UK Gold Demand Rises On BREXIT "Nerves"
– Pensions Timebomb in "Slow Motion Detonation" In UK, EU, U.S.
– Silver – Perfect Storm Brewing in the Market
– Martin Wolf: There Will Be Another "Huge" Financial Crisis

Own gold and silver coins and bars in the safest way possible with GoldCore

Mainstream Getting Bullish on Gold with Rate-Cut Talk

Posted: 03 Jul 2016 01:30 AM PDT

by Samuel Bryan, Schiff Gold:

In his Gold Videocast earlier this week, Peter Schiff said the Federal Reserve will likely use turmoil in the markets following the Brexit vote as an excuse not only to renege on its much anticipated rate-hike, but to cut rates and launch QE4. In fact, Peter was saying the Fed would end up cutting rates in the near future long before Brexit.

Well, the mainstream is catching up with Peter's thinking much faster than normal this time around, and some analysts are becoming more bullish on gold as a result.

As we reported earlier this week, mainstream talking heads are already discussing the possibility of a Federal Reserve rate cut on major media outlets. Now we have a long article in the Daily Mail making the case that the Fed will take a knife to interest rates and gold will benefit:

The prospect of Brexit, and consequent risks to the global economy, have traders thinking the formerly unthinkable — that rather than lifting rates, the Federal Reserve could opt to cut."

Analysts aren't just looking at a Fed cut. Many believe other central banks will move to further ease monetary policy post-Brexit. Bloomberg reported the Bank of England will likely slash rates in the near future:

Havens like gold and silver are in demand on prospects of weaker economies and lower yields on assets such as stocks and bonds, along with prospects central banks will act to support growth. Governor Mark Carney said Thursday that the Bank of England could cut interest rates within months as it tries to shield the UK economy."

It's also possible the European Central Bank and others will drop rates even deeper into negative territory.

As the Daily Mail pointed out, plunging interest rates during the financial crisis in 2008 was a major catalyst for gold and silver:

Ultra-low rates were a key factor driving the metal to record highs near $2,000 an ounce in the years after the 2008 financial crisis, and analysts say any expectations that the US will keep rates on hold or even cut them in coming months would be a further catalyst for a gold price rise."

The article also made the point that precious metals prices can "whip-saw" in times of market volatility, but analysts say "the positive impact on gold of lower interest rates would likely lead to more stable gains for the metal than any uplift generated by market volatility."

Of course, none of this really has anything to do with Brexit. As Peter has been saying, the UK's vote to leave the EU was a "get out of jail free card" for Janet Yellen. Brexit will be the excuse, or the catalyst for rate cuts and quantitative easing, not the cause:

You know, she's kind of boxed herself into a corner because she doesn't want to admit how weak the US economy is, but then, she doesn't want to actually raise rates. She keeps talking about the fact raising rates is appropriate because the economy is strong, but the reason she can't raise rates is because she knows the economy is weak. And so, this gives her the perfect excuse. Now she can blame her failure to raise rates on Brexit and all of the turmoil that has resulted. In fact, she can even use this as an excuse to cut rates back to zero and launch QE4."

Read More @

Psychologists Explain Why People Refuse To Question The Official Version Of 9/11

Posted: 02 Jul 2016 11:00 PM PDT

by Alex Pietrowski, Activist Post:

September 11th is the most polarizing event in modern world history. After looking at the aggregate of the accumulated facts and analysis that has emerged since the day itself in 2001, many people find it impossible to believe the official version of events, and since no serious government investigation is considering new evidence or professional analysis, people are left to decide for themselves if there is more to the story.

Due to the sheer volume of information that defies the government's explanation of events, to believe the official story it now requires some sort of trick of the mind, or some sort of subconscious unwillingness to even entertain a contrary possibility.

Regarding 9/11 truth, people will say the most absurdly illogical things, such as:

"I wouldn't believe what you're telling me, even if it were true."
"I don't need to look at the evidence."
"I don't want to know the truth, or I'd become too negative."
"If that were true, someone would have leaked it by now."
"That's ridiculous, there is no way our government would harm us."
"What makes you think we even deserve to know the truth?"

So, why is it that people have such a hard time even questioning the official version, and why is it difficult for them to even look at alternative information about the events of 9/11?

At this point we have nine years of hard scientific evidence that disproves the government theory about what happened on September 11th, and yet people continue to be either oblivious to the fact that this information exists, or completely resistant to looking at this information. So the question becomes, why? Why is it that people have so much trouble hearing this information?

From my work I think we would be remiss not to look at the impact of trauma. – Marti Hopper, Ph.D.

Trauma Based Mind Control Works

Firstly, it is critical to bring attention to the severity of trauma incurred when witnessing and processing an event of this magnitude. The nation, and much of the world, is still suffering from mass, collective PTSD, and as time goes by, our exposure to more acts of terror only amplify our attempts to bury this trauma within the psyche.

The darker and more horrifying the affront to our humanity, the more effective we are at burying it. The shock and awe theory of consciousness.

Many people respond to these truths in a very deep way. Some have a visceral reaction, like they've been punched in the stomach. To begin to accept the possibility that the government was involved is like opening Pandora's Box. If you open the lid and peek in a little bit, it's going to challenge some of your fundamental beliefs about the world. – Robert Hopper, Ph.D., Clinical Psychologist

Protecting Worldview

Psychologists highlight how the human mind has a tendency to look out for its own security, protecting itself from ideas that challenge core beliefs. When your worldview comes into serious doubt, it can feel like everything is crashing down, and that you're being thrown into the great wide open with no security. Much as the body shifts into fight or flight mode when danger is clear and present, so, too, the mind has tools of evasion from harm.

When we hear information that contradicts our worldview, social psychologists call the resulting insecurity, 'cognitive dissonance.' – Frances Shure, M.A.

The mind tries to survive by allowing conflicting information to exist simultaneously, unconsciously choosing to bury that which causes the most disruption to the comfort of held beliefs.

In the case of 9/11, and other events where the media plays a critical role in creating a narrative of what happened, one cognition is always the official narrative which typically supports presently held beliefs about society, and the other cognition can be based on fact and evidence, but since it challenges to undermine the safety of such illusions, it is thusly overridden.

9/11 truth challenges the beliefs that our country protects us and keeps up safe, and that America is the good guy. When your beliefs are challenged, fear and anxiety are created. In response to that, our psychological defenses kick in, and they protect us from these emotions. Denial, which is probably the most primitive psychological defense is the one most likely to kick in when our beliefs are challenged. – Robert Hopper, Ph.D

The result is disharmony, the collapse of a very important worldview and a source of psychological protection. What is left in its place is insecurity, vulnerability, and confusion, triggering a survival mechanism.

Read More @

WATCH OUT If Silver Breaks Through This Threshold Next Week

Posted: 02 Jul 2016 10:10 PM PDT

by Steve St. Angelo, SRSRocco Report:

The huge Silver Rally this week took a lot of precious metals investors by surprise. The silver price surged 15% since the BREXIT vote results last Friday. Silver began trading at $17.25 last Friday and closed at $19.76 today. Gold also performed very well by increasing 7%.

From 1996 to 2004, the price of silver traded below its 200 MA (RED LINE). Once it jumped above it in 2004, it never fell below it except for the brief time it bounced off it at the end of 2015. While I don't pay a lot of attention to Technical Analysis, a lot of traders do.

What is important to notice in the chart is the 50 MA (BLUE LINE). Once the silver price fell below the 50 MA at the beginning of 2013, it continued to decline over the next three years. However, as the price of gold and silver started to rise in the beginning of 2016 and surge even higher after the BREXIT vote last week, silver is only $0.75 away from breaking through the 50 MA (BLUE LINE).

Watch Out If Silver Breaks This Threshold Line

What is interesting about this present silver rally is shown the the chart below:

From 1996 to 2004, the price of silver traded below its 200 MA (RED LINE). Once it jumped above it in 2004, it never fell below it except for the brief time it bounced off it at the end of 2015. While I don't pay a lot of attention to Technical Analysis, a lot of traders do.

What is important to notice in the chart is the 50 MA (BLUE LINE). Once the silver price fell below the 50 MA at the beginning of 2013, it continued to decline over the next three years. However, as the price of gold and silver started to rise in the beginning of 2016 and surge even higher after the BREXIT vote last week, silver is only $0.75 away from breaking through the 50 MA (BLUE LINE).

Once silver breaks above this 50 MA Threshold, I believe we are going to see a great deal more hedge fund and traders move into the silver market. We may see the banks try and hold silver from crossing this trend-line, but if silver does close above $20.50 next week and continue higher… this could spell real trouble for the bullion banks who hold a great deal of silver short contracts.

Precious metal investors who were hoping for lower gold and silver prices to purchase more metal were caught by surprise as the silver jumped 15% in a week. Those who have NOT YET BOUGHT METAL, you may be paying a lot more of the price of silver really starts to take off over the next several weeks. I heard that several precious metals dealers said, "They had never seen anything like the kind of sales they were experiencing today."

I will be putting out a very interesting article on the silver market next week that provides data showing how undervalued silver is compared to gold.

Read More @

How to make fireworks in your account

Posted: 02 Jul 2016 08:56 PM PDT

While most of the US population drowns in a prolonged semi-conscious state for several days, with moments of alertness (they'll know they are alive when they see the fireworks) - the remaining force of human intelligence on the planet, spends time trying to figure out ways to break through this vast blanket of social control that's been thrown over the population like a sticky net, which is slowly eating away at the global standard of living, overall quality, lowering human genetic value.  Each day, our money is worth less and less.  Why?  We explain this in Splitting Pennies - Understanding Forex.

The problem with much discussion on Zero Hedge and alternative media in general, is that it lacks a conclusion and proposed solution.  So, we mostly agree that the USD is toast, there's an insurmountable debt that cannot be paid back (because in a debt-based money system, if the debt is paid off, money will cease to exist).  Gold is the go to alternative to stocks & bonds which are mostly overrated - but then what?  So let's say Gold hit's $50,000 USD per ounce.  Then what?  Well for one, be sure that you have some good security because in a crisis, the only real currency is accelerated lead, as elaborated here eloquently.

So what is an investor to do?  Fundamental analysis of markets is impossible, because of reasons outlined well on this site:

1) Market data is manipulated heavily.  By the time any investor receives market information (unless he's paying for a front running service) one can assume it's been seen by leading market controllers, HFTs, directors of various unsundry government organizations, and George Soros.

2) The world changes too rapidly for any fundamental strategy to play out.  Too many wildcard events can derail strategies such as value investing.  Brexit is a great example - and there will be many more "Brexits."

3) Even if the above 1 & 2 didn't exist, an investor would need a carrying broker that was fair and honest, and would provide decent execution, and not go out of business.  With investing strategies such as some which are discussed on this site, this is a big issue.  For example, if Gold is $50,000 let's say that GLD goes bust, and starts a chain reaction on exchange listed ETFs and ETNs, which can't possibly fullfill their underlying liquidity obligations even in currenct conditions, not in extreme conditions.  Could it bring down some BDs with them?  SIPC is limited (..and if it were a TD Ameritrade, no insurance in the world can cover it).  So with such extreme strategies, counterparty risk is very large - especially in such climates that would make extreme strategies flourish.  Florida residents know very well how this works, when a big Hurricane strikes, the majority of underwriters for flood & Hurricane insurance go bust (FL law or mortgage policy sometimes require residents carry "Hurricane" insurance which doesn't cover "flood" damage).  If the markets melt down, as many claim - how many brokers would go bust?  How many leveraged banks?  Some big banks are not looking good (such as DB - $54 - $75 Trillion derivative bomb), even in this ideal banking climate.

Hoarding a 6 month supply of food, and living in an underground bunker, is not a real solution.  Having a bug out bag, ammo, gold bars & silver coins, and other paraphernalia, it's just survival.  It's not a strategy.  Keeping Gold is the investing equivalent of being a prepper.  And as we've explained in a previous detailed article, preppers have it all wrong.

Algorithmic Trading - The New Asset Class

This is one solution - and likely will soon be an entire asset class by itself.  Robo-Advisors are becoming popular in securities, but on the surface it seems they are only SAS solutions that are replacing human office workers.  They are just doing the job that the office worker RIA used to do; meet with clients and build a vanilla portfolio with 20% Utilities and 50% Technology and 20% "Growth" (whatever that ever meant) and 10% Dividend stocks.  Currently, HFT is dominated by large institutional players that frankly, the public knows very little about.  See one example Jump Trading.  The problem is their inaccessability - investors will need many millions to start (consider $50 Million, for a good start).  Also, having the $50 Million doesn't qualify you for anything.  Now you'll have to develop your own algorithms, or hire another firm to do it.  But this is the equivalent of hiring a consultant to tell you what business you are in (Consultants, and lawyers, will do this for a fee).

Then there's the world of retail algorithmic Forex, not allowed for US investors (or at least, so highly restricted and regulated it makes any normally profitable strategy, barely profitable).  As this chart shows, it really is "Magic:"

The above is a real live trading account over a period of 3 years.  Not likely that an investor can find such performance in stocks, or 'robo advisors.'  

The point is that an algorithm can trade any market, and if the strategy is stable, and consistent, it can deliver investment returns above and beyond the average, that are not correlated to the market - and most importantly - NOT DEPENDENT ON HUMAN BEINGS.  An algorithm isn't perfect, but it solves the basic fundamental problems of human traders.  And there are thousands of them.  You can even evaluate FX algorithms for free, without investing a penny.  Checkout as one example - there are many.  To learn more about investing in Forex checkout Fortress Capital Forex here. 

Algorithms give developers many abilities that simply wouldn't be possible with human traders.  Most importantly, in a sterile development environment, it's possible to test, analyze, and optimize any trading idea relatively quickly, and then develop a robust strategy based on this process.  It's necessary to invest heavily in computing to do this, but many who have done this will offer their strategies for investors use.  What's good about this approach is that it's an investment in a methodology, not in an asset class. 

This is a fundamental mistake made by modern investors.  Gold is great.  But then what?  During Brexit for example, it was possible to buy and sell the Great British Pound by more than 10 signficant moves, during a 10 hour period.  That's activity that an algo can capture.  Just 'investing' in the US Dollar, or Great British Pound - is risky.  If an algo is built with a robust risk management module, it's the safest way to trade the markets.  And one doesn't need to become an expert in mathematics and algorithm development to do so - there are hundreds of algos available for use by any investor, big or small.  But if one does want to take on a challenge and build his own investing system, there are literally thousands of free resources online to support that development.  There's companies that have built a business out of algorithm development.  And certainly, this is only the beginning of a new blue ocean market.  The reason algos are the future?  Because they work.  That's all.

Morgan Stanley Explains One Big Reason Why Central Planners Can't Generate Any Inflation

Posted: 02 Jul 2016 06:45 PM PDT

As China continues to weaken the Yuan, it's important to note the impact that it has on the inflation expectations of other economies, namely the US, Japan, and Europe. As central planners aggressively try to boost inflation, and in the meantime have created a stunning $11.7 trillion in negative yielding debt, China could be hindering that effort quite a bit.

As Morgan Stanley points out, CNY has weakened over the last year or so versus the Euro, Yen, and Dollar and is helping to explain the continued undershoot of inflation in Japan and Europe - and we would add in the US.

From MS

The RMB decline has materialized mainly against the EUR and even more so against the JPY. This may explain the continued undershoot of inflation in Europe and Japan.

MS goes on to note that the overcapacity in Asia (something we have discussed often) and a weaker currency will continue to lead to lower export prices, and thus dampen future inflation expectations, which can be seen in the US 5y5y inflation expectations. MS also observes that developed market inflation behavior is led by movements in Chinese prices, and the rally in global bonds will continue to push the USD higher, putting further downward pressure on prices.

Moderate US growth together with overcapacity in Asia and a weaker RMB will likely result in lower export prices from Asia. Market-based US inflation expectations are now lower than April, supported by Michigan survey data, all despite commodity prices being generally higher. Post Brexit our rates strategy team remains long duration, which is further supported by this lacklustre inflation environment. Inflation expectations might be held back by falling import prices from economies that run spare capacity. Exhibit 23 shows that the recent DM inflation behaviour was actually led by the movements in Chinese prices. The rally in global bonds, particularly in the US, may actually push USD higher as foreign investors look for places with a relatively high yield.

MS concludes by saying that deflationary pressures are likely to remain in place as overcapacity persists.

Important for the outcome is the evaluation of global deflationary pressures, which may be primarily fed from Asia. Yes, China’s PPI has improved from -5.9%Y to -2.9%Y, but RMB has declined over the past couple of quarters at an annualized rate of 11%, suggesting that import price deliveries from China are currently falling by 5%. Importantly, deflationary pressures are likely to remain in place as overcapacity persists. Take for instance the steel sector, where production capacity has increased by 35 million tons as China progressed through its recent mini-cycle.

Within the G10, Australia, New Zealand and Japan are most likely to see the most import pressure to the downside.

* * *

In summary, while Kyle Bass has the ultimate long-term endgame pegged, in the short-term, China will continue to systematically export deflation around the world, and continue to be a significant thorn in the side of central planners everywhere who are trying desperately to generate any type of meaningful inflation and salvage whatever is left  of their credibility.

Source: Morgan Stanley

"Our Monetary Humpty-Dumpty Is Heading For A Great Fall" - Teetering On The Eccles Building Wall

Posted: 02 Jul 2016 05:15 PM PDT

Submitted by David Stockman via Contra Corner blog,

The Eccles Building trotted out Vice-Chairman Stanley Fischer yesterday morning. Apparently his task was to explain to any headline reading algos still tracking bubblevision that things are looking up for the US economy again and that Brexit won’t hurt much on the domestic front. As he told his fawning CNBC hostess:

 “First of all, the U.S. economy since the very bad data we got in May on employment has done pretty well. Most of the incoming data looked good,” Fischer said. “Now, you can’t make a whole story out of a month and a half of data, but this is looking better than a tad before.”

You might expect something that risible from Janet Yellen - she’s just plain lost in her 50-year old Keynesian time warp. But Stanley Fischer presumably knows better, and that’s the real reason to get out of the casino.

What is happening is that after dithering for 90 months on the zero bound the Fed has run out the clock. The current business cycle expansion—as tepid as is was— is now clearly rolling over. So the Fed has no option except to sit with its eyes wide shut while desperately trying to talk-up the stock market.

And that means happy talk about the US economy, no matter how implausible or incompatible with the facts on the ground. No stock market correction or sell-off of even 5% can be tolerated at this fraught juncture.

That’s because the U.S. economy is so limp that a proper correction of the massive financial bubble the Fed and other central banks have re-inflated since March 2009 would send it careening into an outright recession. And that, in turn, would blow to smithereens all of the FOMC’s demented handiwork since September 2008, and indeed since Greenspan launched the era of Bubble Finance back in October 1987.

So when Fischer used the phrase “the incoming data looked good”, he was doing his very best impersonation of Lewis Carroll’s version of Humpty Dumpty. “Good” is exactly what our monetary politburo says it is:

“When I use a word,” Humpty Dumpty said, in rather a scornful tone, “it means just what I choose it to mean—neither more nor less.”

The fact is, the “lesses” have it by a long shot, but the Fed cannot even whisper a word about the giant risks, challenges and threats which loom all across the horizon.

So for the third time this century, a business cycle contraction will come without warning from the Fed. Once again the Kool-Aid drinking perma-bulls, day traders and robo-machines will be bloodied as they stampede for the exit ramps. But it is the main street homegamers, who have been lured back into the casino for the third time this century, that will suffer devastating losses yet another time.

Indeed, if there were even a modicum of honesty left in the Eccles Building it would be warning about the weakening trends in the US economy, not cheerleading about fleeting and superficial signs of improvement.

Likewise, it would acknowledge the drastic over-valuation of the stock, bond, real estate and other derivative financial markets and remind investors that a healthy capitalism requires a periodic purge of such excesses in order to check mis-allocation of resources and malinvestment of capital.

Most importantly, it would flat out confess the inability of monetary policy—–even its  current extraordinary accommodation variant—–to ameliorate the structural and supply-side obstacles to a more robust rate of economic growth and wealth creation in the US.

In that regard, it would especially abjure the hoary notion that an excess of monetary stimulus is warranted because fiscal policy and regulators, for example, are allegedly not holding up their side of the bargain.

In fact, monetary stimulus is not the “only game in town”, as is often asserted; it’s the wrong game. Money printing is not a second best substitute for other pro-growth policies because it’s not pro-growth at all.

At best, it shifts the incidence of economy activity in time, such as when cheap mortgage rates cause housing construction to be higher today and then lower in the future when rates normalize.

But mainly monetary stimulus causes systemic mis-pricing of financial assets. It turns money and capital markets into gambling arenas where speculators capture huge unearned windfalls while the mainstream economy is deprived of growth and productivity inducing real capital investment.

Thus, instead of dispensing sunny-side agit prop Friday morning, Fischer might have noted the startling anomaly that was occurring at the very moment of his CNBC appearance.

To wit, the 10-year US Treasury note——the very benchmark of the entire global financial system—-had just kissed a record low yield of 1.38%. At the same moment, the futures market was signaling an open on the cash S&P 500 at 2110 or within 0.09% of its all-time high and at nosebleed PE ratio of 24X reported earnings.

Not in a million years would an honest, healthy, stable and sustainable free market have produced that combination. Starring at CNBC’s on set monitors, Fischer was looking at a screaming warning sign that financial markets have become radically unhinged. Starring into the cameras, he lied through his teeth in order to perpetuate the Fed’s sunny-side narrative.

Here’s the thing, however. The Fed’s primitive Keynesian models are all about quantity of economic factors and the short-run sequential change in the GDP and jobs data sets. There is not even acknowledgement of qualitative factors or how the “incoming data” aligns with historical trends.

Nor does a positive quarter purchased at the certain expense of a sharp reversal a few periods down the road get discounted. The Fed model is all about sequential GDP gains——even if there are blatant indications that they are not sustainable or compatible with the prerequisites for healthy capitalist prosperity and stability.

All of these considerations were evident in the incoming data releases on Friday and in recent days——the very items that Fischer insisted had gotten better from “a tad before”.

Booming auto sales have been a pillar of the weak overall recovery since 2009, but even they came in for June down by a sharp 4.6% from prior year at 16.7 million light vehicles. Moreover, this was a continuation of the weakening pattern since last fall, and a clear indicator that the peak sales rate for this cycle is already in:

But that’s not the half of it. Given population and household growth since the 2007 peak, 18 million units should be the floor of a healthy sustainable US economy, not a momentary peak, as is evident in the chart.

And this point is made all the more salient given the qualitative factors behind the peak levels that were achieved late last year. To wit, the entire rebound from the 2008-2009 crisis lows was funded with debt, and much of it was issued to anyone who could fog a rearview mirror.

That’s right. Since the auto cycle bottom in mid-2010, retail motor vehicle sales have rebounded at a $360 billion annual rate, whereas auto loans outstanding have risen by $355 billion.

Moreover, the apparent low default rate of recent years was self-evidently misleading in the context of Bubble Finance. Owing to the collapse of new car sales between 2007 and 2011, there has been a sharp reduction in the supply of used cars, causing the resale value of the existing fleet to steadily rise.

Rising used car prices, in turn, made it easy for even marginal consumers to refinance old loans into new vehicle purchases, thereby avoiding defaults. At the same time, artificially low interest rates enabled auto finance companies to finance loans and leases at exceedingly low but unsustainable monthly payment rates.

So the auto contribution to GDP growth during the last few years had an unsustainable “virtuous circle” character. There was no reason, therefore, to believe these gains could be replicated permanently. In fact,  there was every reason to believe that the artificial Fed induced auto finance cycle would be eventually reversed, thereby generating substantial, off-setting “payback” down the road.

That risk is now materializing. The entire “virtuous” but artificial auto finance cycle is reversing as a flood of used cars—–reflecting the booming sales of the last four years—–comes into the resale market.

Consequently, used car prices are heading south, thereby undermining trade-in values and eligibility for new loans.  The index of used car prices is now down 5% from its recent peak, and based on past cycles has a long way down yet to go.

Alas, downward trending used car prices will also means that default rates will be rising for the simple reason that underwater borrowers will not be able to refinance their “ride” into a new or more recent vintage used vehicle.

Likewise, new car loan and lease finance will be shrinking because the estimated “residuals” on leases and collateral value on loans will be lower. That means loan-to-car price ratios will come down—just as trade-in values on existing vehicles are also dropping. The resulting financing gap means lower sales and production rates in the auto sector.

In short, there has not been a healthy recovery of the auto industry owing to 90 months of ZIRP and the Fed’s massive money printing escapades. This misbegotten monetary stimulus has only generated a deformed auto financing cycle that is now reversing and which will soon be extracting its pound of payback.

Needless to say, Fischer eschewed the opportunity to talk soberly about the headwinds facing the strongest sector of the recent recovery. And this is only illustrative. The same can be said of housing—where cheap mortgages have raised prices far more than output of new housing—and countless others.

The recession will come, therefore, with the Fed flat-footed again and this time, out of dry powder, as well.

Indeed, so thoroughly will the Fed be discredited when the market crashes again by 40% or 50% or more, that modern Keynesian central banking will be faced with an existential crisis.

To use the metaphor, our monetary Humpty Dumpty is heading for a great fall, and all the Imperial City’s potentates and poobahs will not be able to put it together again.

And that would be a very good thing.

"This Is The Capitulation Phase" - Why Treasury Yields Are About To Really Plunge

Posted: 02 Jul 2016 04:42 PM PDT

While mom and pop investors and BTFDers (if not so much hedge and mutual funds and other "smart money") have been delighted by the latest V-shaped surge in stocks, it has come as we have repeatedly shown...


... at the expense of collapsing long-term yields as another central bank liquidity tsunami is priced in. In fact, early Friday both 10Y and 30Y US Treasury yields plunged to new all time lows, a signal which at any other time would suggest a deflationary tsunami is about to be unleashed, but in this case simply meant that another bout of central bank generosity was coming to prop up risky assets in the aftermath of Brexit.

The problem is that while stocks can - for now - ignore this historic divergence, which has pushed the S&P back to just shy of all time highs while bond yields are at all time lows, one major market participant can no longer pretend to not notice what is going on. We are talking about pension funds, who according to Bank of America are about to "throw in the towel" and capitulate on the de-risking of their portfolios, unleashing the next major buying spree on the long end, in the process likely pushing the 10Y to 1% or even much lower.

As BofA's Shyam Rajan writes, bull flattening of yield curves is rarely good news to anyone – but defined benefit pension plans are most leveraged to this pain. According to the most recent Milliman estimate, the average funded ratio of the top 100 US corporate defined benefit pension plans already had dropped to 77% by end of April. Since then, 30y rates dropped another 50bp and corporate spreads have tightened. While the asset side has provided some relief given that equities are hanging on to the highs, we think it is safe to assume that funding ratios over the last month have now reached the lows seen in 2012 – a rather sobering thought given that the equity rally of 70% since then has meant nothing and has been subsumed by the rate decline. The dominant factor of pension funding gaps has been the move in rates, as Chart 2 makes clear.

According to BofA there are five reasons why capitulation is more likely now.

Talking about pension capitulation seems counterintuitive when funded ratios are at record lows on the heels of a significant decline in rates. After all, why would a pension manager hoping for mean reversion at the beginning of the year feel forced to throw in the towel at these levels? 10y rates have been here before, funding ratios have been this low before, and this is not the first time for a flight to quality out of Europe and Japan into the US. What makes this time different? We identify five reasons (three macro, two pension-specific) that make capitulation this time around much more likely:

Here are the reasons:

1. Longer term growth

The key difference from a few years ago is the formalization of the "new normal" in the markets. Global estimates of neutral real rates are much lower, the Fed's estimate of the long-run rate has dropped nearly 100bp, and the yield curve in itself sends a bleak message (Chart 2). While in 2013, 10y rates reached similar levels and the market pushed out the Fed nearly three years, it remained optimistic for the long run. Terminal rates were priced to be north of 3.5%, with forward inflation expectations above the Fed's target. Today, every intermediate forward beyond 3y1y is 50-200bp lower than the lowest point in 2013. There is greater understanding that the yield moves are not temporary but a glaring reflection of the new normal across the globe

2. Inflation expectations

The inflation market signals the same pessimism. Chart 4 shows inflation expectations across global markets relative to central bank inflation targets. Zero on the chart indicates that the markets on average expect the central bank to hit its inflation target over 30 years, while negative indicates a miss to the target. Among the markets that priced-in positive inflation risk premia in late 2013, almost all now project  their central banks to miss their targets over 30 years.


3. The gravitational pull of negative yields

Any assumed lower bound for rates has been thrown out the window given the moves to negative rates. Nearly 33% of the BofAML Developed Market (DM) sovereign index now trades negative in yield, and the US makes up nearly half of the positive yielding assets available to investors. The long end of the US curve remains cheap to European and Japanese investors (on unhedged or partially hedged basis) who are getting pushed out of their domestic sovereign markets because of QE. Fundamentally, the macro rationale for the ECB and BoJ to stop QE is years away, and flow-wise, the safe haven scarcity problem motivating flows into the US is here to stay.

4. Variable PBGC premiums

The penalties for underfunding have increased markedly since 2012 and are scheduled to increase even more. Based on the latest budget act, for each $1,000 of underfunding, variable rate Pension benefit Guarantee Corporation (PBGC) premiums increase from $30 to $33 in 2017, $37 in 2018, and $41 in 2019. Nearly 33% of the BofAML Developed Market (DM) sovereign index now trades negative in yield Essentially, the top 100 corporate defined benefit pension plans will be paying at least ~$20bn/year in variable premiums by 2019 if current levels of underfunding remain.

5. Borrowing to solve the pension tension

The greatest impediment to pension risk transfers (used loosely as a term for offloading some or all of the pension risk to an insurance company who then fund them with annuities) is the need to raise cash to bring funding ratios to par before passing it on to the insurance company. In this regard, low corporate bond yields (and ECB corporate buying) actually could help. Consider the BofAML Corporate Master index – the effective yield of single A rated corporates is 2.52% and that of BBBs is 3.4%. The relative tradeoff now between issuing debt vs paying 3-4% of variable premiums is increasingly attractive – corporates could consider issuing debt to make pensions whole and probably come out with a net positive after tax savings on debt interest (Chart 6). While issuing debt to buyback stock has been a popular strategy, issuing debt to make pensions whole could be the next trend in fixing balance sheet risk. A broader discussion of this trade-off is beyond the scope of our piece, but it reinforces the point that despite wider funding gaps, there is likely a greater incentive or larger fear that is likely to motivate pension de-risking in the coming months.


To be sure, the current collapse in yields has precedented: in 2011, rates declined more than 100bp, curves flattened by more than 75bp, the large scale downgrade of European bonds left Treasuries as the only choice, and there was greater acceptance that 10y yields probably wouldn't go back to 4% anytime soon. This move prompted significant pension de-risking in 2012 – evident in the two large risk transfer trades (GM and Verizon), widening long-end swap spreads, and significant increase in Treasury holdings of defined benefit pension plans (Chart 7).

As Bank of America summarizes, a capitulation at this point seems inevitable:

Today, all of the above is amplified. Treasuries make up nearly 50% of the positive-yielding DM sovereign bonds; curves are 100bp flatter; and there is a greater likelihood that 10y yields probably won't go back to even 2.5%. We would expect a bigger capitulation by pension managers in the coming months/years.

How big of a market are we talking about here in case there indeed is a capitulation be? Well, in a word - massive. It's a $3 trillion trade.

For the rates market, the significance of this acceptance phase by pensions cannot be understated, in our opinion. A $3 trillion industry running a $500 billion funding gap and a significant duration gap waking up to reality is likely to have major implications for the market. The nature of the de-risking is less important but could amplify the impact. In the simplest de-risking scenario, pension managers would stop underestimating the perceived lower bound for US rates and be more aggressive in using rate sell-offs to close duration gaps. In the extreme case, entire pensions could be offloaded from corporate balance sheets to insurance companies (increasingly like the UK, Exhibit 1)–generating significant demand for long-end duration during such transactions. One only needs to look at the long end of the UK rates market to see the significance of pension demand (Chart 9). Note that the UK regulation on inflation protection for pensions is more stringent, leaving the impact primarily on real yields. A similar move in the US is likely to be more evenly divided between reals and breakevens.


The final question: what will be the market impact of the capitulation:

Flatter curves, positive sign for swap spreads & long-end balance sheet trades. Ultimately, the de-risking of pensions whether via a full risk transfer or not would have significant implications for the rates market. Defined benefit pension holdings of USTs still stands at a rather low 6% of total assets (Chart 8)

  • Rates: It would add to the long list of buyers (Japanese, European investors, index shorts) eager to add duration on any modest sell-off in US rates. This would limit any sell-off in rates to short-lived, positioning-led squeezes higher in yields, following which a flood of demand would take over. Active hedging by pensions also
    is likely to keep receiver skew in longer tails rich.
  • Curve: Any sizable de-risking is likely to be a flattener. Even if corporations issue to shore up pensions, which then subsequently de-risk, the net impact would likely be a flattener, in our view. This is because issuance would be skewed toward the belly of the curve where demand dominates, while the de-risking flow happens in the long end of the curve. While this is a long-term theme, it should help our tactical flattening call on the curve.
  • Spreads and strips: Long-end demand from pensions also would be the welcome sign of relief the long end of the spread and coupon-strip curve need. The lack of consistent real money demand combined with $150bn in 30y UST supply every year and lack of dealer appetite to police these relationships has in short been the primary driver of tightening of long-end spreads and cheapening of coupon strips. Some 46bp of extra yield in USTs over swaps and 25bp of extra yield in c-strips over p-strips should look extremely attractive to investors settling for below-2% yields.

What all of this means in simple, numeric terms for the two securities everyone is most familiar with, namely the 10Y and the 30%? It means look for the 10Y Treasury to drop under 1% while the 30Y plunges to 1.50% or lower, as the entire world slowly but surely turn Japanese, where incidentally, the world's largest pension fund - the GPIF - just lost $43 billion in the past quarter as a result of the failure of Abenomics and its hail mary attempt to offset billions in underfunding using a monetary policy gimmick. Similar losses are coming to pension funds much closer to you next.

When Government Controls All Wealth

Posted: 02 Jul 2016 04:15 PM PDT

Authored by Bonner & Partners' Bill Bonner (annotated by Acting-Man's Pater Tenebrarum),

Sliding Into Absurdity

Stock markets continued their rebound to almost erase all Brexit losses. London’s FTSE 100 Index is above Brexit levels but Europe’s equivalent of the Dow, the Euro Stoxx 50, remains lower.



No wonder the Dragon and his partners in crime flooded the EU banking system with “money” this past week…


Investors have realized Brexit isn’t the end of the world. First, because they think it won’t really happen. After all, elites can fix elections, buy politicians, and control public policy… surely, they can fix this!

A letter in the Financial Times reminds us that Swedish voters cast their ballots against nuclear power in 1980. The government just ignored them, doubling nuclear power generation over the next 36 years.

Second, because investors see the panic over Brexit leading to more spirited intervention by central banks! The EZ money floodgates – already wide open – are to be opened wider.

The U.S. has its QE program on hold, but Europe’s scheme is gushing like Niagara. Mario Draghi at the European Central Bank buys $90 billion a month in bonds. And he’s not only buying government bonds; he’s buying corporates, too.


Less Than Zero

In Japan, always a trendsetter, the Bank of Japan has bought so many bonds it has pushed Japanese government bond yields below zero – out to more than 45 years on the yield curve!

In other words, you can now lend to the bankrupt Japanese government until 2051 with no hope of making a single yen, nominally, on your investment. Now, with bonds stacking up in their vaults, the Japanese feds are diversifying. They’re buying exchange-traded funds (ETFs), too.



JGB weekly over the past 5 years….still a widow-maker! – click to enlarge.


Via its ETF purchases, the BoJ buys about $30 billion of Japanese stocks a year. This has made it a top 10 shareholder in about 90% of the companies listed on the country’s Nikkei 225 Index.

Apparently, the BoJ announced it would buy a particular kind of politically correct ETF, even before such an investment existed. This led to a rush to meet the demand (no matter how looney) to create exactly the ETF the Japanese feds were looking for.

So now, the phony money created by the BoJ buys phony ETFs created by the sushi equivalent of Wall Street – solely for the purpose of letting the Samurai feds put more phony money into the financial sector. The ETF then must buy politically fashionable companies, many of which probably wouldn’t exist were the fix not in so deeply.

Result?  The Bank of Japan – not private investors – is the proud owner of stocks and bonds that private investors didn’t want, bought at prices they wouldn’t pay. The whole show is too goofy for words. But words are all we’ve got!



Meet Goofy.


Capitalism Without Capital

“It is just a matter of time,” says a friend writing from Switzerland, “before the feds own all our assets. They’re determined to keep prices high and they have unlimited resources.”

Yes, stocks, bonds, old copies of Mad Magazine… everything will be owned by the government. Then our liberty will be complete. We will have nothing… and nothing to lose.

We will have become what leading German post-war economist Wilhelm Röpke had anticipated: the “stable fed” animals that depend on their masters to keep them going.


Bakers Dairy Farm in Haselbury Plucknett



At last, we will have the kind of capitalism another economist – Karl Marx – dreamed of: capitalism without private capital. The Deep State will control all our wealth.

We will go to college on federal loans… we will drive cars, leased of course, at federally subsidized low rates… we will live in houses mortgaged by federal mortgage lender Fannie Mae… with the mortgage rates pushed down by its fellow manipulator, Freddie Mac… we will work for companies that depend on the Fed’s EZ money financing…and, of course, our medical care will be in the hands of the feds… and our retirement finances too.

Cradle to grave – Chapter 1 to Chapter 11 –  all on central bank credit.

Each dollar in the private sector is either earned or borrowed. The feds and their crony friends get their money for free. Gradually, they own more and more assets, while the rest of the people owe more and more debt.


Sacred Tether

But wait –  let us look again at the maze of dots. How did this happen? Yesterday, we saw that price is not the same as value. If you want to increase prices, all you have to do is spread around some cash. Drop money from helicopters, especially in bad neighborhoods, and prices will soar. But value?

Here is where it gets interesting.  Because when you drop money from helicopters, values tend to drop, too. What shoemaker will still take pride in a making a good pair of walking boots, when his money floats down from Heaven with no effort at all?



Manna from heaven… we’ll all be rich! As Keynesian economists will confirm, capital is a self-replicating blob, that only waits for us to “spend”!


What company will still sweat and strain to produce the best possible products, when its revenues no longer come from demanding customers? What analyst sharpens his pencil to find the best companies to invest in, when there is no longer any connection between money and quality performance.

In rich neighborhoods or in poor ones, giving away money causes trouble. Quality declines, as fewer and fewer people are willing to put in the time and trouble to produce it. And why should they? The ancient and sacred tether, connecting quality to wealth, effort to reward, has been severed.

Want to know why the average American man earns less today than he did 40 years ago? Want to know how the rich got so filthy rich? Want to know why, as the Financial Times put it yesterday, Hillary is afraid of a “populist contagion”?



Something went wrong along the way… but what?


The feds got out the knife in 1971. They changed the money system itself. They severed the link between gold and the dollar – and between value and price. It was so subtle almost no one objected… and so clever almost no one saw what it really meant.

It took us more than 40 years to figure it out. And even now, the dots reveal a pattern, but it is indistinct… hard to see… and easy to misinterpret. Most people see only the symptoms, the boils. the fever, the night sweats – and the daytime delusions:

The masses voting for Brexit or Donald. Interest rates falling to 5,000-year lows. The gap between rich and poor opening wider and wider. What is the cause?

Stay tuned...

Post #Brexit EU on The Verge of Implosion

Posted: 02 Jul 2016 02:00 PM PDT

EU CRUMBLES: Germany Benefits while EU States SUFFER - Merkel support PLUMMETS. The Financial Armageddon Economic Collapse Blog tracks trends and forecasts , futurists , visionaries , free investigative journalists , researchers , Whistelblowers , truthers and many more

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Posted: 02 Jul 2016 01:30 PM PDT

End times, end times signs, end times news, end times events, bible prophecy, prophecy in the news, tornado, earthquake, strange weather, strange events, apocalyptic signs, apocalyptic events, strange weather phenomenon The Financial Armageddon Economic Collapse Blog tracks trends...

[[ This is a content summary only. Visit or for full links, other content, and more! ]]

Nigel Farage roasts the EU Parliament before & after Brexit

Posted: 02 Jul 2016 01:00 PM PDT

Compilation of Nigel Farage at the EU parliament before and after the Brexit vote. The Financial Armageddon Economic Collapse Blog tracks trends and forecasts , futurists , visionaries , free investigative journalists , researchers , Whistelblowers , truthers and many more

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Posted: 02 Jul 2016 12:00 PM PDT

"To avail ourselves of all talent possible" Just exactly what talent does the military expect a transgender is going to have that they could not recruit in a natural male or female? This shit is getting beyond strange. Almost demonic. The Financial Armageddon Economic Collapse Blog...

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Brexit And Silver Update

Posted: 02 Jul 2016 11:07 AM PDT

the Silver Analyst

#Brexit has sparked the beginning of a Revolution -- Nassim Taleb

Posted: 02 Jul 2016 11:00 AM PDT

Britain has started a REVOLUTION against 'stupid' Brussels elite and EU is 'DOOMED' - Nassim Taleb economist and author explaines it all. Britain Started a REVOLUTION against 'Stupid' Brussels Elite & EU is 'DOOMED' The Financial Armageddon Economic Collapse Blog tracks trends and...

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Forget #Brexit , Stock Market Best week of 2016

Posted: 02 Jul 2016 10:30 AM PDT

Central Banks Activate Plunge Protection As BREXIT Began Stock Market CRASH! Both the S&P 500 and the Dow posted their best weekly gains, up 3.2%, since the week ended Nov. 20, according to FactSet data. The Financial Armageddon Economic Collapse Blog tracks trends and forecasts ,...

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Gerald Celente : Bigger than Brexit: Market Mayhem. Will Gold Glow?

Posted: 02 Jul 2016 08:27 AM PDT

Gerald Celente - TREND ALERT: Bigger than Brexit: Market Mayhem. Will Gold Glow?- (6/29/2016) "The latest Trend Alert is released, Gold continues to glow and "US home sales fell a more than expected 3.7% in May". Original release: June 29th, 2016. The Financial Armageddon Economic...

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Economic Collapse -- We Are Approaching A Hyperbolic Curve Which Is The Collapse: Harley Schlanger

Posted: 02 Jul 2016 07:45 AM PDT

Today's Guest: Harley Schlanger Stockpile everything which you might need in a global economic collapse: Food, fresh water, medical supplies, nutrient supplements, batteries, fuel, guns and ammunition (legally), flashlights, spare parts (vehicles, etc.), clothes, and be well networked with real...

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Bullion Management Group's Brandon White offers 'The Week in Three Minutes'

Posted: 02 Jul 2016 06:40 AM PDT

9:40a ET Saturday, July 2, 2016

Dear Friend of GATA and Gold:

Brandon White of Bullion Management Group in Ontario, which knows about manipulation of the gold market and isn't afraid to acknowledge it, has begun doing a weekly three-minute video summary of developments relevant to the gold market. The program is titled "The Week in Three Minutes" and the video from Friday, June 24, can be viewed here:

White is glad to e-mail you a link to the video every Friday, there's no cost, and the summary is free of commercial promotion. To get on White's list, please visit here:

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


USAGold: Coins and bullion since 1973

USAGold, well known for its Internet site,, offers contemporary bullion coins and bullion-related historic gold coins for delivery to private investors in the United States, Europe, Canada, Australia, and New Zealand. It is one of the oldest and most respected names in the gold industry, with thousands of clients and an approach to investment that emphasizes guidance and individual needs over high-pressure sales tactics. The firm's zero-complaint record at the Better Business Bureau makes it an ideal match for the conservative, long-term investor looking for a reliable contact in the gold business.

Please call 1-800-869-5115x100 and ask for the trading desk, or visit:

USAGold: Great prices, quick delivery -- all the time.

Join GATA here:

New Orleans Investment Conference
Wednesday-Saturday, October 26-29, 2016
Hilton New Orleans Riverside
New Orleans, Louisiana

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

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

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Central banks playing competitive devaluation, fund manager Bass tells Real Vision

Posted: 02 Jul 2016 06:22 AM PDT

9:21a ET Saturday, July 2, 2016

Dear Friend of GATA and Gold:

Zero Hedge today excerpts an interview done by Grant Williams' Real Vision with fund manager Kyle Bass, highlighting an observation Bass says he heard from a leading central banker a few years ago.

Bass quotes the central banker speaking about the central banking fraternity this way: "So we're all trying through our treasury and our Fed to get the rest of the world to not devalue against us, while we quietly attempt to devalue ourselves against them, and it's all this race to the bottom. It is the beggar-thy-neighbor policies that we all talk about. And I believe that there is no way out."

... Dispatch continues below ...


A Contrarian's Call Option on Gold

Sandspring Resources' Toroparu project in Guyana is the fourth-largest gold deposit in South America held by a junior mining company.

Experienced backers of Sandspring Resources include Silver Wheaton, the John Adams / Energy Fuels group in Denver, and Frank Giustra's Fiore Group in Vancouver.

A 2013 preliminary feasibility study shows strong economics for this large-scale mine at US$1,400 gold. With a current gold price below US$1,300, Sandspring is for investors who believe that gold price suppression will be overcome.

For a detailed report on Sandspring Resources by Tommy Humphreys of CEO.CA, please visit:

Of course assertions that the world's debt has gotten out of control and will have to be devalued are not new. A decade ago the Scottish economist Peter Millar wrote an incisive study on the point, arguing that such devaluations are required regularly in fiat currency systems to avert catastrophic debt deflations:

Four years ago the American economists and fund managers Paul Brodsky and Lee Quaintance wrote a paper surmising that currency devaluations and an upward revaluation of gold were already the long-term objectives of the world's major central banks so they might reliquefy themselves:

A week ago Gold Newsletter editor Brien Lundin made a similar point -- that the United Kingdom's withdrawal from the European Union was not in itself a reason for gold to rise but that the devaluations of currencies that likely would follow was very much a reason:

Of course if currency devaluation is or becomes central bank policy, gold is the traditional mechanism for it, with silver serving as gold's flamboyant publicist.

It is hard to see such an event as anything but a last resort for central banking, a repudiation of the financial system and the unleashing of hyperinflation on the world. But being so corrupt and tyrannical, the system does seem to need repudiation.

Zero Hedge's excerpt of Real Vision's interview with Bass is posted here:

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

* * *

Join GATA here:

New Orleans Investment Conference
Wednesday-Saturday, October 26-29, 2016
Hilton New Orleans Riverside
New Orleans, Louisiana

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

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

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

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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Shanghai pressures gold paper markets, and China remonetizes silver

Posted: 02 Jul 2016 05:49 AM PDT

8:48a ET Saturday, July 2, 2016

Dear Friend of GATA and Gold:

USAGold's July letter notes that the Shanghai Gold Exchange is almost entirely a physical market, that it seems to be putting pressure on gold derivatives markets in the West, and that China's purchases of silver have been rising dramatically lately, indicating that China sees silver as being just as much a monetary metal as gold. Of course for many decades China's primary money was silver. The USAGold letter is posted here:

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


The Gold Mine Barrick Might Regret Having Sold

K92 Mining is poised for production at its Papua New Guinea gold project and has just listed on the Toronto Venture exchange under the symbol KNT.V.

The gold mining startup came together during one of the toughest periods in mining history.

K92's main asset is the Kainantu project, a large high-grade gold resource with extensive infrastructure including underground mine development, a mill processing facility, a fully permitted tailings pond, and paved roads. The infrastructure means K92 can aim to restart mining in the near term with minimal capital costs and seek to grow through cash-flow funded exploration on the roughly 405-square kilometer property, considered prospective for additional discoveries.

For more information, please visit:

Join GATA here:

New Orleans Investment Conference
Wednesday-Saturday, October 26-29, 2016
Hilton New Orleans Riverside
New Orleans, Louisiana

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

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

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

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:

To contribute to GATA, please visit:

Dollar earners offer investors some security amid upheaval in the markets

Posted: 02 Jul 2016 05:27 AM PDT

This posting includes an audio/video/photo media file: Download Now

BrExit Gold And Silver – The Only Money That Matters

Posted: 02 Jul 2016 03:21 AM PDT

The focus this week will be on the charts as much of the Western world remains embroiled in events that become harder and harder to cover up explain.  The elites and their central banker’s curtain continues to be pulled back for all to see, yet the vast majority of the public fails to associate the world’s financial woes as having originated by pure elite greed for control over both money and people. BREXIT has yet to be put into effect, and it remains to be seen if the globalists will ever allow it to happen.  They have more tricks up their sleeves than a street full of prostitutes.  At least with the latter, there is willing consent.

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