Sunday, November 30, 2014

Weekend Chillout - The Silver Price Remembers the 80's

I thought we would take a trip back in time to when the USD silver price had a $15 handle, no not last Friday, the Eighties!! - Do you remember the 80's? Well most of it was best forgotten but there were some gems worth rescuing, like this video of a ridiculously self confident 17yo Kate Ceberano. Watch this video and you just know she was destined for bigger things.



From my facebook page, Kate still remembers the 80's, afer all she was there.

Gold Shortage, Worst In 21st Century, Sends 1Y GOFO To Lowest Ever... And India Just Made It Worse

From Zerohedge.com

Article link

While we have covered the aberration that is a negative gold GOFO rate previously and in extensive detail in this post, an abridged version of what negative GOFO means comes courtesy of Deutsche Bank's recent discussion on what a successful Swiss gold referendum. To wit: "It is interesting to note that benchmark gold-dollar swap rates have recently traded negative, meaning investors are paying to borrow gold. This is unusual as gold is traditionally used as a source of collateral for cash financing.... [A] number of factors may play a role, such as excess dollar liquidity or an increased demand for collateral on the back of the global regulatory developments." In short a gold shortage at the institutional, read commercial and central bank, level. And not just a shortage but the biggest shortage in history, judging by today's latest plunge in the 1 Month GOFO which just dropped to -0.5% and , worse, 1 Year GOFO that just hit its lowest print in the 21st century, and is also about to go negative: something that has never happened before further suggesting the gold shortage could go on for a long, long time!
Negative GOFO

To be sure, GOFO has printed negative in the past, although the two most prominent historic plunges were due to acute events which promptly renormalized, and were not the result of what has now become a chronic gold collateral shortage via the swaps market.

The best known example of a complete collapse in the GOFO rate, is the September 1999 Washington Agreement on Gold, which was an imposed "cap" on gold sales (mostly European in the aftermath of Gordon Brown's idiotic sale of UK's gold) to the tune of 400 tons per year. The tangent of the Washington Agreement is quite interesting in its own right. Recall the words of Milling-Stanley from the 12th Nikkei Gold Conference:
"Central bank independence is enshrined in law in many countries, and central bankers tend to be independent thinkers. It is worth asking why such a large group of them decided to associate themselves with this highly unusual agreement...At the same time, through our close contacts with central banks, the Council has been aware that some of the biggest holders have for some time been concerned about the impact on the gold price—and thus on the value of their gold reserves—of unfounded rumours, and about the use of official gold for speculative purposes.

"Several of the central bankers involved had said repeatedly they had no intention of selling any of their gold, but they had been saying that as individuals—and no-one had taken any notice. I think that is what Mr. Duisenberg meant when he said they were making this statement to clarify their intentions."
Of course, this happened in a time long ago, when the primacy of Fractional reserve banking was sacrosanct, when the first Greenspan credit bubble (dot com) was yet to appear, and when barbarous relics were indeed a thing of the past, only to be proven oh so contemporary following not one, not two, but three subsequent cheap-credit bubbles which have vastly undermined the religious faith in fiath and central banking, sending the price of gold to all time highs as recently as 2011.

Another subsequent negative GOFO episode occurred in early 2001, which coincided with what has been rumored to be a speculative attack and reversal of the futures market. However, while pushing 1 month rates negative, 3 month rates remained well positive.

The only other time when both 1M and 3M GOFOs were both negative or almost so (3M touched on 0.05%) was in the aftermath of the AIG bailout following the Lehman collapse in November 2008, which reset the GOFO rate to just barely above 0% where it has traded for most of the time, at least until last summer when in a widely documented episode of negative GOFO rates, GOFO went negative in July of 2013 and remained in negative territory for over a month.

Which brings us to today, when not only is the 1 Month GOFO rate the most negative it has been since 2001, not only is 2 through 6 Month GOFO also negative, and in fact the 6 Month GOFO is now negative for the longest stretch in history clocking in at 11 consecutive days, but, strangest of all, the gold curve backwardation is about to become absolutely historic with 1 Year GOFO just a whisper away from hitting negative territory for the first time ever at 0.02667%.



But how is it possible that there is a shortage of gold when gold prices keep tumbling day after day, the skeptics will ask? Simple: the shortage involves gold "available" in the repo market, i.e., gold that already has been rehypothecated one ore more times. Keep in mind that central banks rarely if ever purchase gold outright in the open market, unlike Russia of course (and perhaps China), which has been engaging in an unprecedented gold buying spree over the past year. The rest of the commercial and central banks merely rely on shadow banking conduits and other repo channels to satisfy their gold needs, all of which merely demand the "presence" of synthetic, if not actual physical gold.
It is this synthetic "shadow" gold that is now actively disappearing from the system.Of course, if and when central banks were to tip their hand and reveal the unprecedented synthetic shortage to the physical market, the actual cleared market may well go bid only.

India shocks observers by scrapping gold import rule

One event that may stretch the already ridiculous disconnect between physical and swap-based gold, is the announcement earlier today by India which just scrapped a rule mandating traders to export 20 percent of all gold imported into the country, in a surprise move that could cut smuggling and raise legal shipments into the world's second-biggest consumer of the metal after China.
As Reuters reports, "along with a record duty of 10 percent, India introduced the so-called 80:20 import rule tying imports to exports of jewellery last year to bring down inbound shipments and narrow the current account deficit that had hit a record.

"It has been decided by the Government of India to withdraw the 20:80 scheme and restrictions placed on import of gold," the Reserve Bank of India (RBI) said on Friday, without giving a reason for the change in the rule.

The reason today's announcement was stunning is that only days ago there were talks between officials of the Mumbai-based central bank and the finance ministry in New Delhi to bring back curbs on some trading houses following a surge in imports over the past few months.

Traders said before the decision on Friday that India's gold imports could climb to around 100 tonnes for a third straight month in November as dealers bought heavily on fears of curbs on overseas purchases, especially as the wedding season picks up.

The government's latest move came as a surprise even to some officials.
A policymaker associated with India's gold import policy said the government instructed the RBI at 1830 local time on Friday to urgently change the rule. A notification was posted on the central bank's website two hours later.
"We were not informed about the reason for scrapping this rule. The restrictions on who all can import who can't are still valid," said the policymaker, declining to be named as he is not authorised to talk to media.
And while those in control are unhappy that India's relentless appetite for gold is about to return, and in the process slam the country's current account deficit, at least one group is happy: "the rule change was a relief to jewellers facing difficulties in sourcing gold during the key festival and wedding season that started in October."
Bachhraj Bamalwa, director of the All India Gems and Jewellery Trade Federation, said the 80:20 rule was not only encouraging smuggling but was also misused by many traders.

From getting human mules to swallow nuggets to hiding gold bars in dead cows, smugglers had raised their activity since the middle of last year after the import curbs.

Following the disbanding of the 80:20 rule, the government may place a monthly or yearly quota for traders, said Sudheesh Nambiath, a senior analyst at consultancy Thomson Reuters GFMS.

"Quota is a more logical and simple way of monitoring and limiting gold imports," Nambiath said.
Bottom line: one can again add India to the list of end-market where hundreds of tons of physical gold will end up, never to be heard from again.
And then there is of course the wildcard of the Swiss gold referendum on Sunday, where a "Yes" vote would lead to the immediate collapse of the gold price suppression mechanism as the swap-based gold shortage breaks through merely shadow conduits and finally makes its way to the real market. Which, of course, is why it will never be allowed to happen.

Saturday, November 29, 2014

Black Friday Madness comes to Gold and Silver Markets

Seems the Gold and Silver markets have embraced the Black Friday sales concept and sold off, giving shoppers sale prices on both metals.

Gold was down 2.5% and silver down a massive 6.64% for the day. In Australian dollar terms it meant that gold was off $30/oz and silver off a whopping $50/kg!

Several factors seem to be in play at the moment, the Swiss Gold Referendum is on Sunday (polls indicate a No vote) and the continuing slide in the oil price have both weighed down the gold market and which has been amplified in the much smaller silver market.


charts from goldprice.org

Friday, November 28, 2014

Citi - "Gold: A Six Thousand Year-Old Bubble Revisited"

If Citi a analyst thinks he is smarter than 6,000 years history, and billions of people alive, and dead (many of them dead from mining and fighting over gold) then the chances of him being right are?......

Click here or on the image to access the full report

http://willembuiter.com/gold2.pdf


Thursday, November 27, 2014

Axel Merk on Swiss gold referendum

Christie’s Hong Kong Autumn Sales Netted $388M

Just as well there is no inflation.

Nov. 27 (Bloomberg) –- Christie’s Chairman & International Head of Asian Art Jonathan Stone discusses Christie’s Hong Kong Autumn Sale, some of the pieces that were up for sale and the records that were set with Angie Lau on “First Up.”

Australian Housing: Are Foreign Buyer Rules Broken?

Nov. 27 (Bloomberg) –- The flood of foreign money into Australia has pushed up property prices and critics say it’s gone too far and that rules are being bent. Bloomberg’s Paul Allen reports on “First Up.”

 

The Death of Paper Money

First the elite took our gold, then our silver and finally our paper money, and with that went our right to spend freely.

From IFO Institut

 

Douglas French: Keynesians Desperate To Keep Boom Going

From WallStForMainSt

Published on Nov 21, 2014

Jason Burack of Wall St for Main St interviewed former President of the Mises Institute Mises.org, author, former banker and contributing editor to Casey Research, Douglas French.

Doug's bio and the titles of his 3 books for purchase can be found here: http://www.caseyresearch.com


The Birth of a Gold Bar


Wednesday, November 26, 2014

Someones Wrong


GoldSeek Radio with Chris Martenson and GATA's Bill Murphy

From GoldSeek.com Radio

Vive le France! - Marine Le Pen Demands Central Bank Repatriate French Gold

France's opposition party leader Marine Le Pen has on the back of the upcoming Swiss Gold vote and the recent Netherlands gold repatriation, asked the Governor of the Banque de France to grow some and audit/repatriate France's central bank gold reserves. Her letter to the Governor follows, for those who are unsure who Marine Le Pen is an interview with her (dubbed into English) follows.

Translated from French by Google Translate:

Mr. Christian Noyer
Governor of the Banque de France
31 rue Croix des Petits-Champs
75049 PARIS Cedex 01

Nanterre, November 24, 2014

Open letter to Mr Christian Noyer on the gold reserves of France 

Dear Governor,

On behalf of the French and in my capacity as the main opposition leader, I am writing to you because it is my duty to present a petition on the gold reserves of France, in the best interests of our nation.

Even before the outbreak of the 2008 crisis, the National Front had anticipated and informed the political institutions of the future worsening of the macro-economic and geopolitical context. As part of the business model increasingly libertarian adopted by France under pressure from Brussels, no economic fundamentals may not sustained improvement. All French can see that the austerity policies demanded by the EU and the ECB and implemented by the government are a proven failure and serious for our country.

The monetary institution you lead has a historic mission to be the custodian of national central bank monetary reserves, including its gold reserves. According to our strategic vision and sovereign, they are neither the state nor the Bank of France but the French people and in addition serve as the ultimate guarantee of public debt and our currency.

In monetary Cold War played between the Western countries and the BRICS countries, gold gradually takes an important role. According to the World Gold Council, China's official gold reserves, India and Russia have increased significantly between 2007 and 2013.

For these reasons and because of the rapid growth of global systemic risk, it is of utmost importance to the future solvency of our nation to engage, by mid-2015, a detailed audit procedure, the results will be the subject of a report. This report must obtain validation of French macro-prudential authorities, ACPR, and will be made public in the year.

This comprehensive audit should contain:

- A complete inventory of physical gold amounts to 2435 tons currently displayed and their quality (serial number, purity, bars 'Good Delivery' ...), conducted by an independent French body (to be defined). This inventory, under supervision of a bailiff, must indicate the country in which the gold reserves are stored in France or abroad.

- A census of all formal financial employment agreement or secret vis-à-vis private banks and corporations, or bilateral loan between France and national and international institutions, having pawned the gold of France to ensure rescue of the euro. In this case, the comprehensive audit should contain the conditions of agreement or loans.

Otherwise:

Whereas, on 30 November, will take place in Switzerland a vote on a request from popular initiative referendum "Save gold for Switzerland" of the UDC party (Democratic Union of the Centre) which provides for the repatriation of their reserves of gold on their soil.

Whereas at the request of some national central banks informed, this country phenomenon for the "return of national gold reserves" and democratic control exists since 2013 in Germany (Bundesbank), Poland etc.

Whereas the Dutch Central Bank recently said it had repatriated 122.5 tons of gold.

Whereas, on 19 May 2014 the Bank of France along with other banks of the Eurosystem, announced it has signed the Washington Agreement gold sales CBGA 4 (Dirty Gold Under the Central Bank Gold Agreements) which provides no transfer of quotas on this five-year period (2014-2019), in contrast to the three previous agreements.

Whereas in fact, the Bank of France already independent, conducted as part of the agreement CBGA 2 on gold sales agreed in 2004 by Nicolas Sarkozy, then Minister of Economy and Finance of the Raffarin government.

The declared official target of more actively manage the foreign exchange reserves of the state to generate € 100 million in additional tax revenue in 2005. N. Sarkozy also said that gold sales would be used "either to finance investments that prepare the future, either to reduce the debt, but in no case to fund operating expenses. "
Over the period 2004-2012, about 614.6 tonnes of gold were sold by France, while at the same time the other central banks of the Eurosystem with the ECB have agreed to limit their gold sales. According to a report of the Court of Auditors in 2012, this operation is extremely costly for public authorities and constitutes a serious violation of the national heritage, made without any democratic consultation.

Mr Governor, according to your statements, "gold remains an important element of global monetary reserves." For the French, you are considered the ultimate guarantor of the security of this gold reserve and therefore the stability of our currency and national financial stability. As a result, your responsibility is huge.

Also, depending on the situation we discover, I urge you to do it:

- In urgent repatriation on French soil of all of our gold reserves located abroad.
- In immediate discontinuation of any gold sales program.
- Conversely, a gradual reallocation of a significant portion of foreign exchange reserves in the balance sheet of the Bank of France by buying gold at each significant decrease in the price of an ounce (recommendation 20%) .
- A suspension of any financial commitment or loan contract would wager that our gold reserves.
- At the patrimonial and financial balance of the 2004 gold sales transactions ordered by N. Sarkozy.

The implementation of these measures is crucial for the future of France face socio-economic problems that may occur.

Just like your heroic predecessors of the Bank of France in 1939 and 1940 had organized the evacuation of French gold, you need to undertake this vast national treasure of the security operation, patriotic act which will be recognized in due time by the public opinion.

I sincerely hope that, respectful of your duties as a senior official in the service of the state, you demonstrate lucidity and courage necessary for the defence of the general interest of our country. The stakes are high, it is the future of France in question!

Please accept, Excellency the Governor, the assurances of my highest consideration.

Marine Le Pen

From RT

Tuesday, November 25, 2014

Sunday, November 23, 2014

Friday, November 21, 2014

Weekend Chillout - My Heart Is A Wheel

Well this week has seen the gold market on a wheel, going around from $1160 to $1200 and back again. Hopefully we can find away out of this wheel rut soon.

By the way it is stinking hot in Sydney today so a strawberry ice cream would go down well right now.

Thursday, November 20, 2014

Matt Taibbi on Why Bankers Will Always Stay Out of Jail

From breakingtheset

Published on Nov 19, 2014

Abby Martin speaks with Rolling Stone journalist, Matt Taibbi, about a JP Morgan Chase whistleblower that has come forward to expose how the company knowingly sold toxic mortgages to investors and how the Justice Department used her as a pawn in its settlement negotiations with the financial giant.

Worldwide War For Physical - Andy Hoffman

From SGTreport.com

Gold Seek Radio interviews Ron Paul on Gold and Liberty

From GoldSeek.com Radio

Gerald Celente: First Financial Calamity then War

From Greg Hunter

Keiser Report: Big Problem? Regulators!

From RT

Published on Nov 18, 2014

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss precious metals manipulation in Switzerland and the costs of the never-ending banking fraud - from the ‘suffering and life long risks’ to children in Europe and beyond to the rising cost of food hitting lower income consumers.

In the second half Max interviews Alasdair Macleod about gold, China, QE and the economy.

Tuesday, November 18, 2014

Keiser Report: 'Numpty' Taxes

From RT

Published on Nov 15, 2014

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss ‘numpty’ taxes and ‘stupid’ Ireland as bankers and central bankers treat everyone else like the ‘muppets’ they believe we are. They also discuss Angela Merkel refusing to meet with Timothy Geithner and how it is that QE is causing deflation.

In the second half, Max interviews Matt Taibbi about his Rolling Stone exclusive on the JP Morgan whistleblower, Alayne Fleischmann, who was interviewed in the previous episode of the Keiser Report.

Boom Bust - “QE is the greatest marketing success in economics history”

From Boom Bust

Indian PM Modi speaks to Australian Federal Parliament

From ABC News (Australia)

Published on Nov 17, 2014

Indian Prime Minister Narendra Modi addresses a joint sitting of Parliament, highlighting his country's progress and challenges for the future.

Claudio Grass - The Average Swiss Worker is in Favor of Gold

From The Daily Coin.org

Greenspan Comes Out as a Gold Bug

From TheAlexJonesChannel

Published on Nov 14, 2014

Ted Anderson of Midas Resources analyzes former Federal Reserve Chairman Alan Greenspan’s candid remarks to the CFR about the supremacy of gold to any fiat currency. The comments were initially cut out but later restored as audio tape surfaced. Ted Anderson also looks at recent changes in tax law in Oklahoma affecting gold and the upcoming Swiss election where returning the Swiss franc to partial gold backing is on the ballot.

Peter Schiff - Live by QE Die by QE. Don’t Be Fooled by the Strong Dollar

From Greg Hunter

Eric Sprott: Global Gold Demand Is Overwhelming Supply

From ChrisMartensondotcom

Saturday, November 15, 2014

Marc Faber: Gold Price, US Dollar & the Swiss Gold Initiative

From Goldbrokercom

Published on Nov 12, 2014

Dan Popescu exclusive interview with Marc Faber (economist and market forecaster) on gold, the US dollar, China and the Swiss gold Referendum.

WTF just happened to the Gold and Silver Price?

Explosive action on the Comex today in both gold and silver. What happened to $1180 being the new overhead resistance?


charts from goldprice.org

Chris Powell of GATA: Gold Manipulation Historical Fact Not Conspiracy Theory

From WallStForMainSt

Keiser Report: Whistleblower Alayne Fleischmann (JP Morgan 'worst nightmare') talks to Max

From RT

Published on Nov 13, 2014

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss the shouts of ‘Ya Me Cansé’ as the people are sick of a corrupt elite above the law. They also look at the headlines of students in India who believe in the right to cheat and at the innocent people who plead guilty to crimes they didn’t commit in America.

In the second half Max interviews Alayne Fleischmann, the JP Morgan whistleblower, profiled in the latest Rolling Stone magazine. They talk about fraud in the mortgage backed securities business, the statute of limitations on wire fraud and what exactly it is that Jamie Dimon wants.

Marc Faber still says the stock market is about to crash and it will be bigger than he previously forecast

Friday, November 14, 2014

Weekend Chillout - When the War is Over

With both Alan Greenspan and seemingly ISIS coming out on the same side of the Gold vs Fiat war this week it seems this 43 year old war is starting to heat up.

IS becomes the only State with Real Money - Gold, Silver and Copper

From zerohedge.com

Article link

It appears the rumors are true. Islamic State is set to become the only 'state' to back its currency with gold (silver and copper) as it unveils the new coins that will be used in an attempt to solidify its makeshift caliphate. ISIS says the new currency will take the group  out of "the oppressors' money system."





As Zaid Benjamin notes, ISIS releases details of its new currancy with golden 1 & 5 dinar, silver 1, 5, 10 dirham and copper 10 & 20 fils 

*  *  *
It seems Alan Greenspan may have been on to something after all...
"Remember what we're looking at. Gold is a currency. It is still, by all evidence, a premier currency. No fiat currency, including the dollar, can match it."
*  *  *

Of course this will mean more physical demand - along with Russia and China - and so more price suppression by the West.

*  *  *

------ End of article -------

I suspect that someone in ISIS has been paying attention to the advice of the Swiss trained (in Economics) Sheikh Imran Hosein.

Did The BoJ Quietly Peg The Yen To Gold?

From Zerohedge.com

Article link

For 14 years, as Japan's economic demise grew more and more evident, its currency devalued relative to gold (the only non-fiat numeraire). When Abenomics began, the trend began to stabilize... but for the last year or so - as The Fed tapered - JPY and Gold have practically flatlined around 132,000 JPY per ounce. This 'odd' stability stands in strangely stark contrast to the volatility and trends in the USD, JPY, and Gold over this period. Even amid the collapse in JPY in recent weeks, it has remained firmly inside a 3% envelope of the 'peg'.

A long trend of JPY fiat devaluation as Japan's lost decades are priced in...


Then odd stability...


Of course, this is conjecture, but doesn't it seem a little odd that with all the hot money flows and violent swings in the last year around the world, that this relationship has been for all intent and purpose - flat and managed.

Charts: Bloomberg

Thursday, November 13, 2014

Tweet of the Week


Wednesday, November 12, 2014

Gold is Currency & No Fiat Including the Dollar, Can Match It

From SGTreport.com

Published on Nov 12, 2014

The second half of Sean's interview with Dave Kranzler from Investment Research Dynamics joins him to talk about Greenspan's u-turn back toward the universal truth that gold IS money, and NO fiat currency including the Dollar, can match it. (His words, not mine). Take that Dollar lovers.

Why this Expert is Buying into Gold

Yes god forbid you would actually buy actual physical gold....

Metals Insider Shares Alarming News about Mine Supply

From silver investor.com

Published on Nov 7, 2014

The state of the gold and silver markets, and what a constricting mine supply and a hiatus from QE will mean for the metals.

Tuesday, November 11, 2014

What Will It Take to Reverse Gold’s Slump?

Nov. 10 (Bloomberg) -- On today's “Single Best Chart,” Scarlet Fu examines the price of gold. StockTwits Co-Founder and Chairman Howard Lindzon also speaks on “Bloomberg Surveillance.”

Monday, November 10, 2014

SGTReport - TRILLIONS of Paper Silver, QUADRILLIONS of Fiat

From SGTreport.com

Published on Nov 9, 2014

Dave Kranzler from Investment Research Dynamics joins Sean to talk about ABN Amro's absurd call for $800 gold in 2015 - and the very real, very powerful PHYSICAL response to the Bankster's paper metals manipulation scheme.

Sunday, November 9, 2014

Alan Greenspan on the Gold Standard

Eric Dubin - On the COMEX, Gold and Silver

From The Daily Coin.org


Marc Faber on Japan QE, Gold and Oil

Nov. 3 (Bloomberg) -- Marc Faber, publisher of the Gloom, Boom & Doom report, talks about Japan's bond-buying program, the global and U.S. economies, and gold and oil prices. He speaks with Trish Regan on Bloomberg Television's "Street Smart."

Saturday, November 8, 2014

The $2.6 Million Watch

Nov. 7 (Bloomberg) -- Thierry Stern, president of Patek Philippe, discusses the company's exclusive Grandmaster Chime timepiece with Bloomberg's Olivia Sterns on "Money Clip."

Alan Greenspan - Gold is a premier currency, no fiat currency, including the dollar, can match it

My thanks to zerohedge.com for highlighting this material.

Alan Greenspan spoke at meeting of The Council of Foreign Relations last week and and shared his views on Gold, QE and Keynes.
"Gold is a good place to put money these days given its value as a currency outside of the policies conducted by governments" ~ Alan Greenspan


From "The Maestro" to "The Apprentice", still one of my favourite Ron Paul moments

Did we just see the bottom in the Gold price?

Was the low in the recent gold price action set yesterday during Hong Kong trading hours? Flash report I received yesterday described the action as:
"XAU - wild ride so far as the metal went down to 1131/32 before it eventually bounced back to 1144ish. The move from 1134 up to 44 happened within a few seconds as the market got swept, roughly 2500 lots did change hands."
Well it seems someone thought that at near $1,130 gold represented a bargain, and plonked on large market disrupting order. This seemed to set the tone for the rest of the day's trading with gold finishing the week at $1,177 for a gain of 3.11% for the trading day.

Also it seems someone loves "lucky 7", as the the approx. 2500 lots above equates to 7,777 one kilo 999.9 gold bars worth $283,500,000 (spot $1134).

chart from goldprice.org

Friday, November 7, 2014

Weekend Chillout - Paint it Black

Well that was a black week for precious metals markets, hopefully this weeks close will see the end to the bombing of the prices, but I fear not.

Keiser Report: Fools & Their Money

From RT

Published on Nov 6, 2014

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss how fools and their money are soon parted whether shale oil investors losing $1.17 for every dollar gained or housing market participants who seek to help people onto the so-called ‘property ladder’ and yet, by lowering standards, increase risk of total financial loss. In the second half Max interviews Dominic Frisby, author of “Bitcoin: The Future of Money?” about the hunt for Satoshi, the importance of bitcoin and the future of money.

SD Metals and Markets - US Mint Caught Totally Off Guard By EPIC Wave of Silver Demand

From SilverDoctors

Warren Pollock - Pompeii Type of Event is Coming

From Greg Hunter

Egon von Greyerz - The Reset Will Be Dramatic

From Greg Hunter

Will Gold Dip Below $1000?

Nov. 6 (Bloomberg) -- Bloomberg’s Ryan Chilcote reports on dropping gold prices and what that means for production. He speaks with Jonathan Ferro on Bloomberg Television’s “On The Move.”

 

American Financial Markets Have No Relationship To Reality — Paul Craig Roberts and Dave Kranzler

Article link

UPDATE Nov. 6, 2014

Zero Hedge notes that day after day massive uncovered short-selling of gold occurs
during periods of thin to non-existent activity in the futures market. http://www.zerohedge.com/news/2014-11-05/because-nothing-says-best-execution-dumping-15-billion-gold-futures-0030et

The next graph shows the intra-day price movements of gold over a five-year period. During times that the Asian physical delivery markets are open, the gold price is up.
During the times the Asian markets are closed and the paper gold futures markets are open, the price of gold declines. http://investmentresearchdynamics.com/proof-that-gold-is-manipulated-using-paper-gold/

Early in the morning of November 5 just after midnight during a period of trading inactivity, 27.44 tonnes of paper gold contracts were dumped into the Comex night access market during a 5 minute period, followed by another 14 tonnes at sunup, for sales of futures contracts representing 41.44 tones of gold. As we have pointed out on a number of occasions, the only purpose of such activity is to drive down the gold price.

The evidence of illegal manipulation is conclusive. Yet, nothing is done about it, because the manipulation is part of the financial authorities strategy for keeping the financial house of cards that they have built standing for as long as they can. As the dollar underpins this house of cards, supporting the dollar, regardless of the illegality and ethics, is regarded as imperative. In America the rule of law is dead.

American Financial Markets Have No Relationship To Reality

Paul Craig Roberts and Dave Kranzler

As we have demonstrated in previous articles, the bullion banks (primarily JP Morgan, HSBC, ScotiaMocatta, Barclays, UBS, and Deutsche Bank), most likely acting as agents for the Federal Reserve, have been systematically forcing down the price of gold since September 2011. Suppression of the gold price protects the US dollar against the extraordinary explosion in the growth of dollars and dollar-denominated debt.

It is possible to suppress the price of gold despite rising demand, because the price is not determined in the physical market in which gold is actually purchased and carried away. Instead, the price of gold is determined in a speculative futures market in which bets are placed on the direction of the gold price. Practically all of the bets made in the futures market are settled in cash, not in gold. Cash settlement of the contracts serves to remove price determination from the physical market.

Cash settlement makes it possible for enormous amounts of uncovered or “naked” futures contracts — paper gold — to be printed and dumped all at once for sale in the futures market at times when trading is thin. By increasing the supply of paper gold, the enormous sales drive down the futures price, and it is the futures price that determines the price at which physical quantities of bullion can be purchased.

The fact that the price of gold is determined in a paper market, in which there is no limit to the supply of paper contracts that can be created, produces the strange result that the demand for physical bullion is at an all time high, outstripping world production, but the price continues to fall! Asian demand is heavy, especially from China, and silver and gold eagles are flying off the shelves of the US Mint in record quantities. Bullion stocks are being depleted; yet the prices of gold and silver fall day after day.

The only way that this makes sense is that the price of bullion is not determined in a real market, but in a rigged paper market in which there is no limit to the ability to print paper gold.

The Chinese, Russians, and Indians are delighted that the corrupt American authorities make it possible for them to purchase ever larger quantities of gold at ever lower prices. The rigged market is perfectly acceptable to purchasers of bullion, just as it is to US authorities who are committed to protecting the dollar from a rising price of gold.

Nevertheless, an honest person would think that the incompatibility of high demand with constrained supply and falling price would arouse the interest of economists, the financial media, financial authorities, and congressional committees.

Where are the class action suits from gold mining companies against the Federal Reserve, its bullion bank agents, and all who are harming the interest of the mining companies by short-selling gold with uncovered contracts? Rigged markets–especially on the basis of inside information–are illegal and highly unethical. The naked short-selling is causing damage to mining interests. Once the price of gold is driven below $1200 per ounce, many mines become uneconomical. They shut down. Miners are unemployed. Shareholders lose money. How can such an obviously rigged and manipulated price be permitted to continue? The answer is that the US political and financial system is engulfed with corruption and criminality. The Federal Reserve’s policy of rigging bond and gold prices and providing liquidity for stock market speculation has damaged the US economy and tens of millions of US citizens in order to protect four mega-banks from their mistakes and crimes. This private use of public policy is unprecedented in history. Those responsible should be arrested and put on trial and they should simultaneously be sued for damages.

US authorities use the Plunge Protection Team, the Exchange Stabilization Fund, currency swaps, Federal Reserve policy, and purchases of S&P futures to support an artificial exchange value of the dollar and to provide the liquidity needed to support stock and bond prices, with the latter so artificially high that savers receive negative real interest rates on their saving.

The authorities have created a financial system totally out of sync with reality. When the authorities can no longer keep the house of cards standing, the collapse will be extreme.

It is a testament to the complicity of economists, the incompetence of financial media, and the corruption of public authorities and private institutions that this house of cards was constructed. The executives of the handful of mega-banks that caused the problem are the people who are running the US Treasury, the New York Fed, and the US financial regulatory agencies. They are using their control over public policy to protect themselves and their institutions from their own reckless behavior. The price for this protection is being paid by the economy and ordinary Americans – and that price is rising.

The latest orchestrated takedown of the gold price is related to two events (see the graphs below). One is that the Federal Reserve decided to boost the upward spike in the dollar’s exchange rate from the Fed’s announcement of the end of Quantitative Easing (QE). The Fed’s announcement of the end of dollar creation in order to support bond prices lessened the rising anxiety in the world about the US dollar’s value when the supply of new dollars continued to increase faster than the US output of goods and services. The Fed reinforced the boost that its announcement gave to the dollar by having its bullion bank agents drive down the gold price with naked short-selling.



Naked short selling was also used to offset the effect on the gold price by the Bank of Japan’s surprise announcement on October 31 of a massive new program of QE. Apparently, the Bank of Japan either has been pressured by Washington to inflate Japan’s currency in order to support the dollar’s value or is applying a policy based on the Keynesian Phillips Curve that 2-3% inflation stimulates economic growth. Japan has been in the economic doldrums for a long time and is now reduced to pre-Reagan “snake oil” prescriptions in a desperate attempt to revive its economy.

Japan’s announcement of infinite money creation should have caused the price of gold to rise. To prevent a rise, at 3:00 AM US Eastern Time, during one of the least active trading periods for gold futures, the electronic futures market (Globex) was hit with a sale of 25 tonnes of uncovered Comex paper gold contracts, which dropped the gold price $20 dollars. No legitimate seller would destroy his own capital by selling a position in this way.

The gold price stabilized and moved higher, but at 8 AM US Eastern Time, and 20 minutes prior to the opening of the New York futures market (Comex), another 38 tonnes of uncovered paper gold futures were sold. The only possible purpose of such a sale is to drive down the price of gold. Again, no legitimate investor would unload a huge amount of his holdings in this way, thereby wiping out his own wealth.



Allegedly, the United States is the home of scientific economics with the predominance of winners of the Nobel Prize in economics. Despite these high qualifications, the price of gold, silver, equities, and bonds that are set in the US bear no relationship to economic reality, and American economists do not notice.

The divergence of markets from economic reality disturbs neither public policymakers nor economists, who promote the interests of the government and its allied interest groups. The result is an economy that is a house of cards.

For additional reading see: http://investmentresearchdynamics.com/the-system-is-terminally-broken/

Thursday, November 6, 2014

Inside The Shanghai Gold Exchange Vaults

From Koos Jansen

Bix Weir - Cartel Guts Metals, Greenspan goes Pro-Gold

From SGTreport.com

Published on Nov 2, 2014

According to Zero Hedge, last Thursday "Someone/something decided it was an opportune time to dump thousands of contracts of gold and silver futures" causing gold and silver to plummet. And on Friday, things only got worse with silver slicing through $16 at one point and gold breaking below $1170. Meanwhile Alan Greenspan is publicly proclaiming the attributes of gold both for Central Banks and individual citizens, just as Bix Weir predicted. Bix joins Sean to discuss the end of our fiat Ponzi system as they debate his theory that former Fed Chairman Alan Greenspan planned to return us to a gold standard all along.

John Embry - SLV May Be Empty Because of Global Silver Demand

From WallStForMainSt

Wednesday, November 5, 2014

Jamie's Got a Gun

more excellent political art from WilliamBanzai7

Person is Jamie Dimon (CEO JP Morgan)
Nail gun reference

Keiser Report: Crash, Boom, Pop!

From RT

Published on Nov 4, 2014

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss ‘American Psycho’ type banker murderers roaming the streets beheading prostitutes. While in the central banks, we see ‘corporatism’ as defined by the World Bank in the 80s and 90s - and that is a balance sheet greater than 25% of GDP.

In the second half Max interviews Professor Steve Keen and artist Miguel Guerra about their new crowdfunded graphic novel series - CRASH, BOOM, POP - where economics will be fun to learn. Professor Keen promises Max a naked Margaret Thatcher to keep with the genre. They also discuss the godzilla in the Japanese central banking consuming any debt the population throws at it and where this might lead for the final global debt showdown.

Tuesday, November 4, 2014

AUD and the Vomiting Kangaroo


Swiss Gold in Bank of England and Canada?

Top article from Goldcore. Article link


Monday, November 3, 2014

Ted Butler - The Silver Nightmare Will Be Over Soon

From ChrisMartensondotcom

Chris has a long discussion with silver expert Ted Butler on the real culprit behind the wild price slams that have plagued silver: unfairly concentrated positions within the derivatives market.

Funniest Tweet of the Week


Keiser Report: Naughty Banking Boys

From RT

Published on Nov 1, 2014

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss how, in the words of Laura Ingalls Wilder, once you begin being naughty, it is easier to go and on and on, and sooner or later something dreadful happens. And in a world of very naughty bankers, many dreadful things have happened.

In the second half Max interviews Dan Collins of TheChinaMoneyReport.com about the emerging post-dollar order as evidenced in the newly launched Asian Infrastructure and Investment Bank and the Shanghai-Hong Kong Connect scheme. They also discuss how in China Jim Rickards went viral and how steel costs as much as cabbage.

Saturday, November 1, 2014

Getting Paid in Gold

Tweet of the Week


Koos Jansen - When China utilizes its Gold the Price will rise

From BullionStar

SD Metals and Markets - Gold & Silver Staring into the Abyss

From SilverDoctors

How Low Can Gold Prices Go?

Oct. 31 (Bloomberg) -- In today's "Bart Chart," Bloomberg's Mark Barton takes a look at gold as it pertains to the dollar, rising equities and tame inflation. He speaks on Bloomberg Television’s "Countdown."

Jim Rickards on China and the Japanese QE experiment

From Boom Bust

Gold price has a "all the grains of sand on the beach to one" moment

Gold and silver prices continued to fall overnight and into the weekly close. Gold closed below the recent strong support of $1,180 finishing the week at $1,172. Silver also finished the week weaker at $16.14.

Although the most astonishing thing about the move overnight, apart from the fact that some cretins sold real money in exchange for digital magic beans was the percentage fall in the US dollar gold price. Overnight the gold price fell 2.14%, unusual in its own right as the gold price rarely moves move than 2% in one trading day, but astonishingly this was the exact same percentage fall in price of the day before (see chart below). If anyone out there could give us a rough figure on how likely such a probability is I would love to know, but I suspect it is in the range of one beach worth of grains of sand to one against.

Makes you wonder if there is a algo out there with the following data entry form:

Percentage move?  2.14

Move up or down?  down

Run for (days)?  2

chart from goldprice.org