Archive for the ‘China’ Category

Hot Spots Give Gold Floor, But Don’t Send it Through the Roof

Posted by on August 20th 2014 in CFTC, China, CME Group, Federal Reserve, General Economy, Gold, Iraq, Monetary Policy, Russia, Short Sellers, Silver, Ukraine, Wall Street | Be the first to comment!

Gold&GeopoliticalRisk

“Gold obviously didn’t like the U.S. CPI and housing data, which boosted the dollar,” said a Saxo Bank manager, speaking about a 0.1% increase in the monthly inflation rate, and July’s 15.7% jump in U.S. home construction.  But despite that, spot gold was off only 0.2%, while spot silver took a 1% hit. And according to an analyst quoted by MarketWatch, gold will likely remain in a narrow trading range, “unless by some miracle, all the tensions in the world are sorted out. A doubtful scenario.  I hasten to add that gold is not the perfect safe haven, far from it, but it does knee-jerk react to headlines, and as such, the downside should be limited for the time being.”  But that said, gold is also not going through the roof during this period of global tensions, as evidenced by the above chart. Grant William’s looks at what’s behind “Gold’s sudden ignorance of geopolitical risk.”

See also:

Jesse’s Café Américain:  The paper metals are a charade

Reuters/BullionStar.com:  China said to allow 3 more banks to import gold; East Asia geared up for renminbi gold trading

GoldSeek/GATA:  The U.S. gold in Fort Knox is secure, gone, or irrelevant?; U.S. gold reserve likely has been leased out, Grant Williams tells KWN

CEO.caBig move brewing for gold

Of Two Minds/Tim Iacono:  Are capital inflows propping up U.S. markets?; Stocks or bonds – Which has it right?

Bloomberg:  Only rich know wage gains with no raises for U.S. workers

ProPublica/TomDispatch.com:  The best reporting on federal push to militarize local police; One nation under SWAT

Metals Seen Biding Time ‘Till at Least September

Posted by on August 19th 2014 in CFTC, China, CME Group, Federal Reserve, General Economy, Gold, Iraq, Janet Yellen, Russia, Short Sellers, Silver, Ukraine, Wall Street | Be the first to comment!

SeptemberSurge

A rising dollar and an equity rally on the perception that Ukraine tensions had eased, were said to be the driving factors behind a 0.4% drop in spot gold on yet another mixed day for the metals that also saw silver add 0.3%. “The market decided that since shooting had not broken out in the Ukraine that all is well and it was time to bulk up on the risk trade, albeit with low volumes,” according to a post at Jesse’s Café Américain, which calls this “a very cynical, Fed-fueled market.”

And in looking at when gold and silver might break out of their narrow trading ranges, Tim Iacono concludes that “Uncertainty over developments in Ukraine and Iraq should produce enough safe haven demand to keep metal prices from falling far during the last two weeks in August, but it seems any substantive rally will have to wait until at least September.”

See also:

Got Gold Report/ETF Daily News:  Comex Swap Dealers remain hugely short silver futures; How speculation fits in to the silver price forecast

SRSrocco Report:  Gold and silver – The eternal monetary couple; How the U.S. dollar reserve currency dies… slowly at first, then all at once

Peak Prosperity:  A brief history of U.S. money

USA Gold/Ciovacco Capital:  Why the Fed is unlikely to raise interest rates soon; Jackson Hole: Covering excuses to keep rates low?

Of Two MindsLoss of faith in the Fed; Have we forgotten what an authentic market is?

NYT Magazine:  Paper boys – Inside the dark, lucrative world of consumer debt collection

Russia, Ukraine Stand Off; U.S. Shoppers Stand Down

Posted by on August 14th 2014 in CFTC, China, ECB, Federal Reserve, General Economy, Gold, Iraq, JPMorgan, Middle East, Russia, Silver, Ukraine, Wall Street | Be the first to comment!

 ShoppersStandDown

Silver futures finished off 0.3% on Wednesday, which is what gold ended up, with the impetus being July’s flat retail sales, described as “an appalling number” that “has faded the notion of a hike in the interest rate by the Fed, at least today.” And while U.S. data held sway over geopolitics, fighting resumed between Israel and Hamas, U.S. troops are on the ground in Iraq, and the Russian aid convoy headed to Ukraine has gone to ground at a Russian military base,  some 300 miles from its Ukrainian destination of Luhansk.  This as Ukraine’s Interior Minister declared that “No Putin ‘humanitarian convoy’ will be permitted to travel through the territory of Kharkiv region.”

See also:

Zero Hedge:  Stocks up, bonds up, gold up, oil up, dollar up, f’d up; Saxo Bank warns of 3 ‘other’ geopolitical risks investors are ignoring

ReutersCommodity future – Islamic State militants grab new weapon – Iraqi wheat

BullionStar.com/Profit ConfidentialSilver scarce in Shanghai, futures curve in backwardation; The world supply of gold bullion is shrinking

The Gold Report:  Jim Rickards and Peter Schiff discuss global gold markets

Reuters:  U.S. Mint to use new silver benchmark for coin sales, purchases; London gold fix lawsuits to be consolidated in New York

bookcoverWall Street on Parade:  How high up did the Madoff fraud go at JPMorgan?

Read the first chapter of  JPMadoff: The Unholy Alliance Between America’s Biggest Bank and America’s Biggest Crook

All Roads Lead to Trouble

Posted by on August 13th 2014 in China, ECB, General Economy, Gold, Iraq, Middle East, Russia, Short Sellers, Silver, Ukraine, Wall Street | Be the first to comment!

ConvoyControversy

Silver futures lost about one percent on Tuesday but gold inched up as Ukraine again took center-stage over the question of access to the country by a Russian humanitarian convoy of almost 300 trucks. But that’s not all.  According to one analyst quoted by Reuters:  “Improving gold prices are due to escalations of Ukraine-Russia tensions and Iraq conflicts, but traders are also worried about Europe’s snail’s pace recovery.”  An economic survey released Tuesday showed that German analyst and investor confidence plunged to an 18-month low. Also, Japan reported a 6.8% annualized drop in 2nd quarter GDP and a collapse in consumer spending.

See also:

MarketWatch:  Gold fear spike may be on its way

Financial Times/Sharps Pixley:  Banks wait on sidelines for new silver benchmark

SRSrocco Report/SilverSeek:  How the global financial system will collapse; Don’t be surprised if silver is the target

Jesse’s Café Américain: No silver for Mexico, but perhaps gold for Eurasia

Book review and excerpt: “China’s second continent – How a million migrants are building a new empire in Africa”

Spiegel/Vice News:  The disturbing rise of the Islamic state

Mises Canada:  The privilege of watching war

‘Cautious’ Investors Seen Keeping Gold Fashionable

Posted by on August 12th 2014 in China, Federal Reserve, General Economy, Gold, India, Iraq, Middle East, Russia, Silver, Ukraine, Wall Street | Be the first to comment!

GoldShirt

The value of an Indian businessman’s new gold shirt was virtually unchanged Monday, while silver, a more practical wearable, gained 0.8%.  Gold’s flatness was attributed to “rising global equities, and an apparent easing of tensions over Ukraine and the Middle East,” with stock markets said to have “largely ignored news Russia would send an aid convoy to eastern Ukraine, a move Western officials have said could serve as a pretext for an invasion.”

But “world inserurity” is still seen as likely positive for gold, according to former Bank of England governor Mervyn King.  And, as one analyst quoted by MarketWatch points out:  “Interestingly, while the yen has unwound, other safe-haven assets such as gold haven’t seen much movement at all. Perhaps this highlights the degree of cautiousness investors are still exercising at the moment.”

See also:

Bullion Vault/Casey ResearchSilver vs. gold investing; Top 7 reasons I’m buying silver now

BullionStar.com/Gold Silver Worlds:  Chinese gold demand 1094 metric tons y-t-d, silver premium at record high; Is gold demand in China really collapsing?

SafeHaven/Gold Scents:  Potpourri of chartology – Precious metals, U.S. stocks and energy;  Are stocks finally starting the topping process?

Confounded Interest/CSMThe Gilded Age: A tale of the Federal Reserve; Wall Street – Whose bull market is it?

GoldSeek/Mineweb:  Dennis Gartman – Gold vs. The Force; Gartman reckons end-game for gold price management could be nigh

Guardian/Daily Beast/Vox:  U.S. denies role in alleged plot to oust Iraqi prime minister; U.S. bombing its own guns in Iraq

Silver Snaps Loss Streak; Eagles Heat Up

Posted by on August 7th 2014 in CFTC, China, ECB, General Economy, Gold, Monetary Policy, Quants, Russia, Short Sellers, Silver, Ukraine, Wall Street | Be the first to comment!

 SilverEagleSalesHeatUp

Concerns about the situation in Ukraine boosted gold futures 1.8% on Wednesday and silver futures added 1% to snap a four-session losing streak. Silver fared better in the spot market, rising 1.7% compared to gold’s 1.6% increase.  Gold was also said to have benefited from data showing that Italy slid into recession in the second quarter, for the third time since 2008.  And, American Silver Eagle gained for the the third straight day, reports Coin News, surpassing 27 million for the year “to maintain a pace that is the second quickest in the coin’s 29-year history.”

See also:

SafeHaven/Got Gold ReportSilver pyramid power; Right or wrong, a great spot for a silver bounce

Mineweb:  Central banks continuing to boost gold reserves

Bloomberg/Telegraph: Russia sanctions accelerate risk to dollar dominance; Putin signs historic $20bn oil deal with Iran to bypass Western sanctions

Jesse’s Café Américain: Currency wars and the inevitable banquet of consequences

Ciovacco Capital/Peak ProsperityScenarios for a vulnerable stock market; Is this decline the real deal?

Reuters/WSJ:  High-frequency trading takes root in U.S. securities class actions; How one whistleblower turned the tables on high-frequency traders

The Fall of Gold and Silver

Posted by on August 5th 2014 in China, ECB, Federal Reserve, General Economy, Gold, Russia, Short Sellers, Silver, Ukraine, Wall Street | Be the first to comment!

TheFallOfGold&Silver

With gold and silver futures off about a half-a-percent Monday, after dropping for each of the last three weeks,  Tim Iacono asks:  “Could a return to positive seasonal trends be in store for gold and silver?“  Referencing the above chart, showing that gold “has recently made a mockery of the regular seasonal patterns by moving opposite the norm over each of the last four months,” he cautions that the August-to-November period “may not follow the favorable seasonal trend either, particularly with the growing list of bearish factors that have emerged,” including the prospect of rising interest rates and the waning of safe-haven demand.

But more optimistically, he also argues that “as summer vacations come to an end, the outlook should improve, particularly if last week’s stock market rout turns into something much worse and the dollar rally fades.”  Add to that the fact that “gold and gold stocks remain two of the best performing asset classes this year and this has not escaped the notice of institutional investors and hedge funds who, in recent months, have been buying gold stocks when the broad stock market falters. If this carries over into the underlying market for gold and silver, a return to following very positive seasonal trends this fall could be in store.”

See also:

Got Gold Report:  Total Chinese reserves reach 15,000 tonnes

Louise Yamada/Mike Shedlock:  Gold chart – False breakdowns and breakouts suggest indecision; Saxo Bank economist-  Gold and silver major buy signal coming up

The Gold Report:   Tocqueville fund managers – Buy gold like it’s 1999

King One Eye/Bloomberg3 bullish facts for precious metals and miners; Gold industry takeovers climb to highest level in three years

MarketWatch:  That plunge in stocks is just the beginning; Brett Arends – Watch out for the corporate debt bomb

Zero Hedge/Washington PostDe-dollarization continues – Russian oligarchs shift cash to Hong Kong dollars on sanctions concerns

Job Gains, 209,000; Wage Gains, 1¢

Posted by on August 2nd 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Janet Yellen, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!

WagesUpOneCent

Metals’ futures ended mixed on Friday with silver falling 0.2% and gold adding 1% on what was seen as a “disappointing” jobs report that sent the dollar “broadly lower” against other major currencies. And while the 209,000 new jobs was the first time since 1997 that the U.S. has added 200,000+ jobs for six straight months, the report also showed an increase in part-time workers and stagnant wages, with the average hourly rate gaining a mere penny. This, according to economists cited by Bloomberg, supports Fed Chair Yellen’s view that “there’s still plenty of slack left in the labor market, bolstering the case for continued stimulus.”

And with the U.S. stock market suffering its worst week in two years, one metals’ trader tells MarketWatch that “You would expect some fund flow into the metals, with the equity price plunge, but it’s conceivable that the market’s dinosaur brain perceives a 2008 event occurring, which suggests a rush to cash.”  He adds that gold and silver “may also be the victim of investors caught in the equity market who are trying to raise cash, due to margin calls; gold remains the most liquid asset for that purpose.

See also:

SRSrocco Report:   Chinese silver inventories nearly 90% depleted at Shanghai Futures Exchange

Acting Man/BullionVaultRisk pops in to say hello; Numb to risk, oblivious to gold

USA Gold:  The fallacy of the inverse correlation between interest rates and gold; The gold owner’s guide to the rest of 2014

GoldCoreGold’s sweet spot – strongest months are August, September, November & January

Alasdair Macleod:  U.S. dollar Fiat Money Quantity carries on growing despite tapering

Comstock Partners/Daily Reckoning:  This is what happens when the Fed tightens; Six major flaws in the Fed’s economic model

MarketWatch/Bloomberg:  Behold, the 17,000% overdraft charge; With ‘protection‘ like this, who needs enemies?

Traders Stock Up on Metals, Not Stocks

Posted by on July 26th 2014 in China, General Economy, Gold, Goldman Sachs, Iraq, Middle East, Russia, Short Sellers, Silver, Ukraine, Wall Street | Be the first to comment!

StockingUpOnMetals

Although gold and silver ended slightly lower on the week, they were back to being safe havens on Friday, with futures gaining about 1% each on what Bloomberg describes as “escalating havoc in Eastern Europe and the Middle East” that “boosted demand for haven assets.” Or, as a brokerage VP put it, “When you see schools shelled in Gaza and heavy artillery fire from Russia and Ukraine, people are very nervous, and you can’t blame them. As we go into the weekend, with the amount of turmoil that we have, people are going to buy gold.”  An opinion seconded by a strategist who added yet another hot spot to the mix, telling Reuters that “With the news flow coming out Russia and Ukraine and you don’t know what’s going to happen in Iraq, traders are buying gold as they don’t want to get too exposed to geopolitical risks going into the weekend.”

See also:

Zero HedgeStocks slide, gold soars on weak earnings, geopolitical fears; Goldman goes schizo on gold – Boosts price target to $1200 even as it’s “Selling It with conviction”

Jesse’s Café Américain:  Metals bounce, huge week for events & news coming

CNBC/Seeking Alpha:  BlackRock strategist – Stock market could get ‘nasty’; The blow-off top is here

New York Times/Bloomberg:  Op-ed – A Chinese gold standard?; Ecuador weighs escape from dollar ‘straitjacket’

BusinessWeek/Euro Pacific Capital:  Gold diggers revive French exploration as prices drive hunt; The strange case of German gold (scroll down)

Time/Daily Reckoning:  Meet America’s most beloved CEO—Too bad he just got fired; Where you can make $56,000 a year delivering pizzas

Metals Retreat; West Bank Palestinians Advance

Posted by on July 25th 2014 in CFTC, China, CME Group, General Economy, Gold, IMF, Middle East, Quants, Short Sellers, Silver, Ted Butler, Wall Street | Be the first to comment!

MetalsRetreatPalestiniansAdvance

Gold and silver ended down about 1% and 2.5% respectively on Thursday, representing a buying opportunity for one scribe, as global strife took a back seat to what was seen as positive economic news from the eurozone and China, and on U.S. jobless claims hitting an eight-year low.  But citing earlier “negative surprises” from the U.S. and Chinese economies, and ongoing geopolitical risks, the IMF lowered its global growth forecast for 2014.

With gold dropping below $1,300 and stalling at its 200-day moving average, Reuters quotes one observer as saying, “To be fair, I think some people have a right to be disappointed that the stresses around the world haven’t led to a continued rise in the price of gold. We’re probably in oversold territory right now where gold is concerned, but we also seem to be pulling into an area between $1,290 and $1,280 that should offer some support to the market.”

See also:

Dan Norcini/Reuters:  China gold demand slumps 19.4 pct on yr, but output rises

Ted Butler:  Silver tightness

Hard Assets Investor:  Gold’s fair value – bear says $800, bull says $5,000

Investing.com/SafeHavenHappy markets in an unhappy world; Clear and present danger zone

Bloomberg/Business Insider:  Don’t tell anybody about this story on HFT power Jump Trading, one of 10 being eyed by the SEC

Wall Street On Parade:  Lawsuit stunner – Half of futures trades in Chicago are illegal wash trades

Conflicts Seen Supporting Gold for ‘Next Several Years’

Posted by on July 23rd 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Iraq, Middle East, Monetary Policy, Russia, Short Sellers, Silver, Ukraine, Wall Street | 1 comment

WorldOfProblems

Silver futures were flat on Tuesday and gold ended modestly lower, at just over $1,300 an ounce, on what was seen as a number of technical factors, such as profit-taking and chart consolidation, as well as “less risk aversion in the market place.” But according to the CPM Group’s Jeffrey Christian, the latter could be short-lived. He’s quoted by Reuters as saying that without the current crop of international conflicts, “gold probably would be down around $1,240 – $1,280 at present.”  But he also points out that these conflicts “all fester without a joint international effort to help resolve them. This means more problems being more difficult to resolve, which probably means that more investors will seek gold as a portfolio diversifier and safe haven over the next several years than otherwise.”

See also:

USA Gold/Dan Norcini:  Gold supported by geopolitical risk, even as stocks, dollar gain; Euro currency breakdown

Sharps Pixley/Mineweb:  Gold & silver – Geopolitical tensionsLawrence Williams – Escalating Ukraine crisis could blow gold sky high

Casey Research/Bloomberg:  The truth about China’s massive gold hoard; Middle East seen gaining gold share as trading expands

Telegraph:  How a golden shield can work for investors; Have central banks been breaking the law?

Zero Hedge:  Portugal president admits Espirito Santo failure could be systemic; NY Fed slams Deutsche Bank (and its €55 trillion in derivatives): Accuses it of “significant operational risk”

SRSrocco Report:  How derivatives will trigger a bond market melt-down

 

Squeezing the Shorts — ‘Watch For It’

Posted by on July 22nd 2014 in CFTC, China, CME Group, Federal Reserve, General Economy, Gold, India, Janet Yellen, Monetary Policy, Russia, Short Sellers, Silver, Ukraine, Wall Street | Be the first to comment!

WatchForShortSqueeze

“You know, if someone with quite a lot of firepower were to take a good look at the Swap Dealer combined positioning in gold and silver, and exploit that by pressing the metals a bit, they sure might have a squeezing good time of it,” writes Got Gold Report‘s Gene Arensberg, in a comprehensive analysis of the current COT set-up. He goes on to predict that “Most anything can happen short term, but at some point gold and silver are going to catch a tail wind strong enough that those attempting to prevent runaway breakouts could be overwhelmed.  It is in such cases that the trader community on the COMEX becomes its most cutthroat and merciless.  If the other traders sense a trapped large trader or group of traders, you know, maybe one with a way-too-huge-short position in a rising price environment as an example … well, let’s just say that all traders consider it a duty to pile on and make them pay.  Watch for it.”

See also:

Reuters/Coin NewsGold rises above $1,300 on heightened tensions, S&P drop;  Gold rises 0.3%, silver advances 0.6%; US Mint bullion coins gain

CNBC/Zero Hedge:  David Stockman – Market’s teetering on edge, beware of Black Swan; Saxobank – “Be warned” of delayed market reaction to “escalation of global turmoil”

MarketWatch:  Bank of America Merrill Lynch – The worst for gold may be over;  Yellen encourages ‘fully-fledged equity bubble,’ says Jeremy Grantham

Bloomberg:  Fed’s junk loan bubble-busting faces trouble as sales jump; Yellen wage gauges blurred by Boomer-Millennial shift

The BRICS Post/The Telegraph:  BRICS bank capital might not be held in U.S. dollars; The dollar’s 70-year dominance is coming to an end

Financial Times:  U.S. dollar clearing rules make gold the new green