Saturday, October 1, 2016



Monthly Charts Argue for Lower Prices in Precious Metals Complex

Posted: 01 Oct 2016 01:14 PM PDT

The trading month doesn't always end on a Friday but when it does we like to take a look at the monthly charts. Generally, I prefer daily and weekly charts because they have more data points. However, monthly charts carry more significance than weekly charts which carry more significance than daily charts. You get the point. One reason and a good reason we expect the current correction to continue is the sector monthly charts.  

The chart below plots the monthly candle charts of GDX and GDXJ. Earlier this year the miners exploded above their 20-month moving averages and into a new bull market. They were trading at three year highs before a bearish reversal in August that reversed the entire gains from July. September saw a recovery but failure to hold most of those gains. This tells us that selling pressure remains present and miners will likely see lower prices in October.


GDX, GDXJ Monthly


The metals show a similar picture. Markets moved well above their 20-month moving averages but the August candle engulfed July's candle while September recovered only to a small degree. That implies lower prices in October. Gold has support around $1290 while Silver has support near $18. Like the miners, the metals remain a healthy distance above their rising long-term moving averages.


Gold, Silver Monthly


The monthly charts and in particular the action of the past two months leads us to believe lower prices in October are more likely than not. The monthly charts obviously take more time to develop (we have to wait an entire month) but they are the most significant. Time will tell but we see the potential for an important low in October. Traders and investors are advised to wait for lower prices and an oversold condition. We will focus on opportunities scattered amongst individual companies. For professional guidance in riding the uptrend in Gold, consider learning more about our premium service including our favorite junior miners which we expect to outperform into 2017.


Jordan Roy-Byrne, CMT, MFTA


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BlackStone Group Says The Market Is The Most Treacherous They Have Seen

Posted: 01 Oct 2016 10:00 AM PDT

There has rarely ever been another time like this. Not since 1999 and not since 1929 before that, have so many billionaires, central banksters, financial elites and fund managers, warned that we are on the verge of a catastrophic bust:   Buy 90% Silver Half Dollars at SD Bullion  As Low As $1.99/oz Over Spot! […]

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Dollar Looks Vulnerable To Start Q4

Posted: 01 Oct 2016 07:54 AM PDT

Breaking News And Best Of The Web

Posted: 30 Sep 2016 05:37 PM PDT

US GDP revised slightly higher, consumer spending softens. OPEC agrees to output cut, oil price jumps. US stocks recover on calming words from Deutsche CEO. Commerzbank to cut 9,600 jobs, suspend dividend. Wells Fargo draws abuse for consumer fraud. China’s debt crisis has gone from inevitable to imminent — but Japan is even scarier. Gold […]

The post Breaking News And Best Of The Web appeared first on

The Midas Touch Consulting Report

Posted: 30 Sep 2016 05:19 PM PDT

The Silver GoldSpot

Deutsche Bank Collapse: The Most Important Bank In Europe Is Facing A Major ‘Liquidity Event’

Posted: 30 Sep 2016 04:42 PM PDT

toilet-paper-stock-market-collapse-public-domainThe largest and most important bank in the largest and most important economy in Europe is imploding right in front of our eyes.  Deutsche Bank is the 11th biggest bank on the entire planet, and due to the enormous exposure to derivatives that it has, it has been called “the world’s most dangerous bank“.  Over the past year, I have repeatedly warned that Deutsche Bank is heading for disaster and is a likely candidate to be “the next Lehman Brothers”.  If you would like to review, you can do so here, here and here.  On September 16th, the Wall Street Journal reported that the U.S. Department of Justice wanted 14 billion dollars from Deutsche Bank to settle a case related to the mis-handling of mortgage-backed securities during the last financial crisis.  As a result of that announcement, confidence in the bank has been greatly shaken, the stock price has fallen to record lows, and analysts are warning that Deutsche Bank may be facing a “liquidity event” unlike anything that we have seen since the collapse of Lehman Brothers back in 2008.

At one point on Friday, Deutsche Bank stock fell below the 10 euro mark for the first time ever before bouncing back a bit.  A completely unverified rumor that was spreading on Twitter that claimed that Deutsche Bank would settle with the Department of Justice for only 5.4 billion dollars was the reason for the bounce.

But the size of the fine is not really the issue now.  Shares of Deutsche Bank have fallen by more than half so far in 2016, and this latest episode seems to have been the final straw for the deeply troubled financial institution.  Old sources of liquidity are being cut off, and nobody wants to be the idiot that offers Deutsche Bank a new source of liquidity at this point.

As a result, Deutsche Bank is potentially facing a “liquidity event” on a scale that we have not seen since the financial crisis of 2008.  The following comes from Zero Hedge

It is not solvency, or the lack of capital – a vague, synthetic, and usually quite arbitrary concept, determined by regulators – that kills a bank; it is – as Dick Fuld will tell anyone who bothers to listen – the loss of (access to) liquidity: cold, hard, fungible (something Jon Corzine knew all too well when he commingled and was caught) cash, that pushes a bank into its grave, usually quite rapidly: recall that it took Lehman just a few days for its stock to plunge from the high double digits to zero.

It is also liquidity, or rather concerns about it, that sent Deutsche Bank stock crashing to new all time lows earlier today: after all, the investing world already knew for nearly two weeks that its capitalization is insufficient. As we reported earlier this week, it was a report by Citigroup, among many other, that found how badly undercapitalized the German lender is, noting that DB’s “leverage ratio, at 3.4%, looks even worse relative to the 4.5% company target by 2018″ and calculated that while he only models €2.9bn in litigation charges over 2H16-2017 – far less than the $14 billion settlement figure proposed by the DOJ – and includes a successful disposal of a 70% stake in Postbank at end-2017 for 0.4x book he still only reaches a CET 1 ratio of 11.6% by end-2018, meaning the bank would have a Tier 1 capital €3bn shortfall to the company target of 12.5%, and a leverage ratio of 3.9%, resulting in an €8bn shortfall to the target of 4.5%.

The more the stock price drops, the faster other financial institutions, investors and regular banking clients are going to want to pull their money out of Deutsche Bank.  And every time there is news about people pulling money out of the bank, that is just going to drive the stock price even lower.

In other words, Deutsche Bank may be entering a death spiral that may be impossible to stop without a government bailout, and the German government has already stated that there will be no bailout for Deutsche Bank.

Banking customers have a total of approximately 566 billion euros deposited with the bank, and even if a small fraction of those clients start demanding their money back it is going to cause a major, major crunch.

Deutsche Bank CEO John Cryan attempted to calm nerves on Friday by releasing a memo to employees that blamed “speculators” for the decline in the stock price

Instead of doing what many have correctly suggested he should be doing, namely focusing on ways to raise more capital for the undercapitalized Deutsche Bank in order to stem the slow (at first) liquidity leak, first thing this morning CEO John Cryan issued another morale-boosting note to employees of Deustche Bank who have been watching their stock price crash to another record low, dipping under €10 in early trading for the first time ever. In the memo the embattled CEO worryingly did what Dick Fuld and other chief executives did when they felt the situation slipping out of control, namely blaming evil “rumor-spreading” shorts, saying “our bank has become subject to speculation. Ongoing rumours are causing significant swings in our stock price. … Trust is the foundation of banking. Some forces in the markets are currently trying to damage this trust.

Just as important, Cryan confirms the Bloomberg report that “a few of our hedge fund clients have reduced some activities with us. That is causing unjustified concerns.” As we explained last night, the concerns are very much justified if they spread to the biggest risk-factor for the German bank: its depositors, which collectively hold over €550 billion in liquidity-providing instruments.

If you would like to ready the full memo, you can do so right here.

One of the reasons why Deutsche Bank is considered to be so systemically “dangerous” is because it has 42 trillion euros worth of exposure to derivatives.  That is an amount of money that is 14 times larger than the GDP of the entire nation of Germany.

Some firms that were derivatives clients of the bank have already gotten spooked and have moved their business to other institutions.  It was this report from Bloomberg that really helped drive down the stock price of Deutsche Bank earlier this week…

The funds, a small subset of the more than 800 clients in the bank's hedge fund business, have shifted part of their listed derivatives holdings to other firms this week, according to an internal bank document seen by Bloomberg News. Among them are Izzy Englander's $34 billion Millennium Partners, Chris Rokos's $4 billion Rokos Capital Management, and the $14 billion Capula Investment Management, said a person with knowledge of the situation who declined to be identified talking about confidential client matters.

"The issue here is now one of confidence," said Chris Wheeler, a financial analyst with Atlantic Equities LLP in London.

So what comes next?

Monday is a banking holiday for Germany, so we may not see anything major happen until Tuesday.

An announcement of a major reduction in the Department of Justice fine may buy Deutsche Bank some time, but any reprieve would likely only be temporary.

What appears to be more likely is the scenario that Jeffrey Gundlach is suggesting

But Jeffrey Gundlach, chief executive of DoubleLine Capital, said investors betting that Berlin would not rescue Deutsche could find themselves nursing big losses.

The market is going to push down Deutsche Bank until there is some recognition of support. They will get assistance, if need be,’ said Gundlach, who oversees more than $100 billion at Los Angeles-based DoubleLine.

It will be very interesting to see how desperate things become before the German government finally gives in to the pressure.

The complete and total collapse of Deutsche Bank would be an event many times more significant for the global financial system than the collapse of Lehman Brothers was.  Global leaders simply cannot afford for such a thing to happen, but without serious intervention it appears that is precisely where we are heading.

Personally, I don’t know exactly what will happen next, but it will be fascinating to watch.

Deutsche Bank – On the Brink of Global Financial Collapse? 2 Experts Who Aren’t Buying A Meltdown This Weekend

Posted: 30 Sep 2016 03:30 PM PDT

Deutsche Bank On the Brink: Could We See A Systemic Financial Collapse Sunday Night? As Much As Part Of Us Would Love To See Deutsche Bank to Blow A $100 Trillion Hole In the Global Financial System This Weekend, We Suspect It Won’t Happen.  Here’s Why:       Eric’s thoughts on the possibility of […]

The post Deutsche Bank – On the Brink of Global Financial Collapse? 2 Experts Who Aren’t Buying A Meltdown This Weekend appeared first on Silver Doctors.

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Deutsche Bank To Trigger Global Financial Collapse THIS Weekend? Eric Sprott Warns “This Is EXACTLY How Things Go Down!”

Posted: 30 Sep 2016 02:15 PM PDT

“Shades of Lehman All Over Again…Except Deutsche Bank Is A MUCH Bigger Entity- Probably 50 TIMES Bigger Than Lehman!… Keep Your Eyes On the Banking Sector Here, THIS Is When You Want to Own Gold and Silver! The Rats Are Deserting the Ship, This Is EXACTLY HOW THINGS GO DOWN!” From SprottMoney: Related:  Deutsche Bank […]

The post Deutsche Bank To Trigger Global Financial Collapse THIS Weekend? Eric Sprott Warns “This Is EXACTLY How Things Go Down!” appeared first on Silver Doctors.

PANIC As Margin Calls Begin: Deutsche Bank Has Financial System On The Cusp Of Collapse

Posted: 30 Sep 2016 02:01 PM PDT

THIS is how the run begins…   From PM Fund Manager Dave Kranzler:    DB stock is now in a full panic sell-off as I write this.  It just hit another new all-time NYSE low on by the heaviest volume ever in the stock since its 2001 NYSE listing.  It's currently down almost 10%.  No […]

The post PANIC As Margin Calls Begin: Deutsche Bank Has Financial System On The Cusp Of Collapse appeared first on Silver Doctors.

Jim Willie: If Deutsche Bank Goes Under It Will be Lehman TIMES FIVE!

Posted: 30 Sep 2016 02:00 PM PDT

A bank failure contagion, that’s whats going to push the price of gold WAY over $2,000/oz again. The Price of Silver is going to be moving over $100 and the price of gold is going over $5,000… A failure of Deutsche Bank would trigger a systemic banking contagion the likes of which the Western world has never […]

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Oathkeeper Chapter 4

Posted: 30 Sep 2016 02:00 PM PDT

A peaceful valley in the mountains of Colorado becomes a battleground pitting the federal government against a rural sheriff's department. Sheriff Bear Ellison finds himself increasingly isolated as he is forced to decide between risking his life protecting a local hero, or reneging on his oath and handing him over to federal prosecutors…     […]

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This Is How A Bank Run Starts – Bill Holter

Posted: 30 Sep 2016 01:59 PM PDT

The take-down of the Western standard of living is happening in real time, RIGHT NOW…     From Bill Holter, JSMineset: I did not intend to write today but 3 events warrant a heads up. 1. Deutsche Bank may be having their "Lehman moment" as 10 hedge funds have withdrawn funds and are cutting exposure […]

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Germany Faces Banking Collapse; Orders Citizens to “Prepare for National Emergency”

Posted: 30 Sep 2016 01:44 PM PDT

Only weeks ago, the German government recommended that citizens prepare for a survival emergency. Was an impending economic collapse triggered by Deutsche Bank and $100 Trillion in derivatives the reason why?   From Daisy Luther, The Organic Prepper:   Hot on the heels of  the Deutsche Bank debacle comes the next nail in Germany's economic coffin. Germany's […]

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Posted: 30 Sep 2016 01:35 PM PDT

Will Deutsche Bank implode today, two days before the end of the Jubilee Year?   Submitted by Jeff Berwick, The Dollar Vigilante:  Nearly a year ago to the day, on September 28th, we wrote "Will Deutsche Bank Be This Cycle's Lehman Brothers?" In it we asked, "In 2008, the financial crisis was set-off by the […]


Deutsche Bank Will “Create A Widespread Global Panic Just Like Lehman” – MSM Suddenly Panicking

Posted: 30 Sep 2016 01:22 PM PDT

“You’re Going to Create a Widespread Global Panic, Just Like Lehman”…   From CNBC: Related:  Deutsche Bank To Trigger Global Economic Collapse This Weekend? Eric Sprott Issues Warning: Deutsche Bank & $100 Trillion In Derivatives Hang By A Thread On Eve Of Jubilee! PANIC As Margin Calls Begin: Deutsche Bank Has Financial System On Cusp […]

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