Archive for the ‘Monetary Policy’ Category

‘Dark Side’ Seen as Bright Spot for Silver Prices

Posted by on April 19th 2014 in China, Federal Reserve, General Economy, Gold, India, Janet Yellen, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!


“There is an insidious Dark Side to the silver mining industry that goes unnoticed by the majority of investors and analysts,” according to the SRSrocco Report‘s Steve St. Angelo.  Based on his figures for 2013, the top six primary silver miners “suffered the lowest average silver yield ever.”  And going forward, he sees it becoming more expensive to produce silver “as ore grades continue to decline while costs of energy, materials and labor increase. For those analysts who believe the price of silver is heading lower in the future… the falling yields and increased costs will prove otherwise.”

See also:

BullionVault/GoldSwitzerland:  Gold price consolidation; Gold is the world’s only ultimate asset

MetalMiner:  When to buy gold & silver – Are prices falling only to turn back up?

Barron’s/CNN Money:  The case against stocks; The divergent trend – Bad for stocks

Silver Investing News:  Dr. Doom’s calling for an economic crash — How will precious metals be affected?

Tim Iacono/  Janet Yellen and the “B-Word”; 7 crazy ideas Yellen didn’t mention, but waiting in the wings

MarketWatch: The Fed’s enormous balance sheet in seven charts

Fortune/Liberty Blitzkrieg:  Big banks lend to corporations over consumers; New report proves it – The U.S. is an oligarchy

The Week:  Food for thought – Surgeons remove 12 gold bars from Indian man’s stomach

May Flowers for Gold and Silver?

Posted by on April 18th 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!


With the COMEX closed for Good Friday, gold and silver ended down almost two percent on the week, but gold is said to be “nearing the end of a bottoming pattern,” according to a financial advisor quoted by MarketWatch, although, “it will need to break out above $1,400 before most traders will be convinced that gold has started a new bull market.”  He adds that the precious metals sector “is now under-owned and could experience another explosive rally once this bottoming pattern is complete.  This could happen soon especially if the U.S. dollar rally is short lived and the equity markets experience a seasonal…’Sell in May and go away‘ decline.”

See also:

Coin News:  Gold, silver fall on week; U.S. Mint bullion coins quicken

SilverSeek/SafeHaven:  Precious metals market report; Gold and silver triggers

IRD/SafeHaven:  Several factors suggest a big move is coming for gold

Zero Hedge:  If the smart money is selling stocks, who’s buying?; The great stock buyback craze is finally ending

GoldCore/CNBC:  85% of pension funds will go bust within 30 years; Bridgewater – Outlook for pensions is pretty awful

Paper Gains Slow; Bullion Sales Grow

Posted by on April 17th 2014 in CFTC, China, Federal Reserve, General Economy, Gold, India, JPMorgan, Media, Monetary Policy, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!


Gold and silver futures added a fraction of a percent on Wednesday, with gold benefiting from “some mild short covering and bargain hunting,” according to one analyst cited by Coin News, which also reports “another day of wide bullion gains,” based on numbers from the U.S. Mint, “adding to already strong figures with sales so far this week at 13,500 ounces in gold coins and 1,122,000 ounces in silver coins. Those top last week sales of 9,000 ounces in gold coins and 1,050,500 ounces in silver coins.”

Dan Norcini sees gold “being batted back and forth between two opposing forces at the moment. The negative force continues to be the slowing Chinese economy with traders fearing a slackening of demand from that key consumer. The positive is escalating tensions in the eastern part of Ukraine.” Bloomberg quotes one commodities broker as saying that “As long as there’s uncertainty in Russia, having some exposure to gold makes sense. With the selloff yesterday, it seems like cheaper insurance today.”

See also:

Tim Iacono/MinewebReuters omits the grey areas about China gold demand;  China gold blogger Jansen sticks by demand figures

WSJ:  India continues to bring home the gold despite import restrictions

SilverSeek:  David Morgan interview on silver market, silver price manipulation & the coming global monetary reset

Michael Pento/Wall Street on Parade:  Fed rigs markets, not the Flash Boys; Insiders tell all: Both the stock market & the SEC are rigged

Zero Hedge:  Atlanta Fed asks “Where are the jobs“; Dallas Fed’s Fisher admits, “Fed policies have made the rich much richer

Metals Drop as Investors Shrug Off Ukraine

Posted by on April 16th 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Goldman Sachs, Monetary Policy, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!


After being “monkey-hammered early on,” gold and silver “limped back higher” to close down 1.8% and 2% respectively on Tuesday, despite a ratcheting up of Ukraine tensions. Gold was “hit by profit-taking as the rally to $1,330 on Fed minutes appeared overdone,” according to one precious metals trader, who added that “The break below 200-day moving average and $1,300 level also triggered tons of sell-stops.” Another factor weighing on gold was said to be “speculation that a gain in U.S. consumer prices will give the Federal Reserve more leeway to reduce monetary stimulus.”

And citing a World Gold Council report on “China’s gold market,” USA Gold points out that also on Tuesday, “the market was worried by the WGC’s opinion that Chinese demand in 2014 might fall short of the “exceptional” demand seen in 2013. The WGC expects 2014 to be ‘a year of consolidation.’ While speculators might view a protracted period of consolidation as a reason to look for yield elsewhere, most buyers of physical gold [and silver] are not speculators. They buy gold for the purpose of long-term wealth preservation. In that frame of reference, steady or even lower prices are a gift, allowing one to accumulate gold weight without chasing ever-rising prices.”

See also:

Dan Norcini/Zero Hedge:  World Gold Council report pressuring gold; Gold futures halted again on latest furious slamdown

Tim Iacono/GoldSeek:  Gold sell-off reminiscent of a year ago

BullionVault/Mineweb:  Silver prices “ready to break out” as futures betting jumps to pre-crash level; USGS – U.S. mined silver output continues to fall

CNBC:  Can gold confound the markets and hit $1,400?

Steve St. Angelo/Bloomberg:  Goldman Sachs is highly motivated to low-ball the price of gold


Broker: Gold as Safe Haven Now ‘More than Ever’

Posted by on April 15th 2014 in CFTC, Federal Reserve, General Economy, Gold, Monetary Policy, Quants, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!


As stocks snapped back on Monday, gold and silver added a fraction of a percent, with gold hitting a three-week high, reports Reuters. It cites an increase in gold’s safe-haven appeal, which it attributes to “growing violence between pro-Russian separatists and Ukrainian government forces, and news that a Russian fighter aircraft made repeated low-altitude, close-range passes near a U.S. ship in the Black Sea over the weekend.” The article also quotes a commodities broker who advises that “the need to have some gold in investment portfolios for safety now is more than ever. A lot of people don’t necessarily trust the stock market at the moment.”

See also:

USA Gold:  Gold gains on geopolitical tensions, threats of ECB policy reaction to strong euro

Financial Times/Wall Street Journal:  ECB policymakers plot QE road map; Central bankers to world – Take our currencies, please

SilverSeek/GATASilver’s ultimate rally – When paper assets collapse; Silver is in backwardation and Comex prices are misleading, James Turk tells KWN

Bloomberg:  CME Group sued on claims high-frequency traders bought access

LA Times/Pulitzer.orgWashington Post, Guardian win Pulitzers for NSA-spying revelations; Complete list of winners, with links to the original articles

Metals Seen Supported by Fed, Stock Drop

Posted by on April 12th 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Goldman Sachs, JPMorgan, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!


With gold and silver ending slightly higher on the week, while stocks continued plunging on Friday, Alasdair Macleod writes of a “better tone to precious metals,” which was set by Wednesday’s release of the relatively dovish minutes from March’s FOMC meeting.  He also contrasts gold, “where Comex volume is moderate,” to silver, where “volume is high indicating very strong support at current levels.”  His conclusion is that “bullion banks trying to balance their silver books cannot do so at current prices. Yet higher prices are likely to trigger a vicious bear squeeze, so it appears the bullion banks with short silver positions will remain trapped either way.”

And in reference to the FOMC minutes, MarketWatch quotes one analyst as saying that “the magic of the central bank’s comments is still very strong and this was one of the reasons that we have seen the bounce for gold this week…We think the downside is limited for now and there is more potential for the upside.  Weak earnings coming in so far — and this trend could very well continue next week. This is going to keep the correction going in the equity market and could make the metal more attractive.”

See also:

Jesse’s Café Américain:  Gold and silver charts – Flight to safety continues

Zero Hedge:  Goldman summarizes the rout – “Derisking is the name of the game”; Blythe Masters under investigation by federal prosecutors   The case for higher U.S. interest rates and higher gold

Bloomberg/In Gold We Trust: Shanghai gold bourse to start lease platform by the end of June;  New physical gold exchange in Singapore

Time/CNN:  Moscow is ‘ready for combat,’ NATO says; Photos ‘show Russian military buildup‘ near Ukraine

Gold and Silver Decouple From Stocks

Posted by on April 11th 2014 in China, Federal Reserve, General Economy, Gold, Janet Yellen, JPMorgan, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!


Futures in gold and silver gained 1.1% and 1.6% respectively on Thursday, with “gold boosted by a sharp pullback in U.S. equities and follow-through buying a day after minutes from the Federal Reserve’s latest policy meeting revealed its cautious approach in future interest-rate hikes,” reports Reuters, quoting one commodity broker as saying that the latter “changed the dynamic of the gold market because now the fear of Fed raising rates has been pushed back further into the future.”

The Reuters article also notes that with the S&P falling 2% on the day, it “has given back all its gains to turn negative for the year.”  An analysis at Hard Assets Investor, headlined “Overdue pullback in S&P 500 to push gold higher,” argues that “Should stocks continue to pull back, gold may benefit from safe-haven buying. We maintain our view that gold will make a run above $1,400 sometime this year and that investors should consider buying at prices below $1,300.”

See also:

Miles Franklin/Mineweb:  Battlefield $20 silver; Silver being left behind in latest gold surge, but don’t despair!

The Gold Report:  Are you prepared for a bull market that will shock even the most ardent goldbugs?

SafeHaven/Of Two MindsChinese checkers with gold prices; Now that the U.S. and China have picked the low-hanging fruit, peak everything looms

New Yorker:  Is China the next Lehman Brothers?

FastMarkets/CNBC: Mitsubishi Corp – India may hold key to higher gold prices; Banker showdown – Bernanke tells off India’s Rajan

Zero HedgeWSJ  – Markets are in thrall to central banks rather than caring about health of economy

Gold and Silver Rally on ‘Dovish’ Fed

Posted by on April 10th 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Goldman Sachs, JPMorgan, Monetary Policy, Quants, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!


Gold and silver finished mixed on Wednesday, but both rallied along with stocks — see “Fed Cat Bounce” — after minutes from last month’s FOMC meeting showed that members seemed less inclined to raise interest rates than previously thought. “The Fed sounds less hawkish than it did last month, which is good for gold,” according to an investment strategist quoted by Bloomberg, who added that the market is nonetheless “confused because there are so many contradicting signals from the Fed.”

Or, as Dan Norcini, under the headline “Dovish Fed sinks US Dollar” describes it:  “Watching them swing from hawkish to dovish in such a short interval makes me understand why our markets are so screwed up. The Fed is consistently changing their assessment of things. That would be just fine and dandy were not the U.S. financial markets addicted to easy money and so utterly dependent on these jokers for their latest fix.”

See also:

Telegraph/Peak Prosperity: China ‘has more gold than official figures show’; China’s demand for gold has trapped the West’s central banks

BullionVault/SilverSeek:  Buying goldandsilver yet?; Real U.S. silver money would consume nearly half of world’s mine supply

J.S. Kim/Zero Hedge:  Bankers are using HFT algos to manipulate gold and silver prices; Put this guy in charge of the SEC

Wall Street on Parade/John Crudele:  Goldman Sachs drops a bombshell on Wall Street: Goldman keeps its “Flash Boys” under wraps

Bloomberg: Global growth threatened in $693 trillion derivatives review

Reuters/AP:  Separatists in east Ukraine call on Putin for help, Kiev warns of force; NATO’s military head – U.S. troops may be sent to Eastern Europe

Metals Gain as Dollar Drops, Ukraine Tensions Rise

Posted by on April 9th 2014 in China, Federal Reserve, General Economy, Gold, Media, Monetary Policy, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!


Gold and silver futures both added 0.8% on Tuesday to close above $1.300 and $20 an ounce respectively, with the gains attributed to a lower dollar and renewed tensions between the U.S. and Russia over Ukraine.  “The unrest in the Ukraine and the escalating rhetoric from the U.S. is creating fear of an armed conflict, so safe-haven demand is definitely driving up gold prices today,” according to one analyst quoted by Reuters, which notes that gold was “also underpinned by official-sector buying after Iraq’s central bank said it might buy more gold in the next few months, having bought 60 tonnes over the past two.”

See also:

Jesse’s Café Américain:  Gold and silver charts – Metals take back their levels

Bloomberg:  Hedge funds get gold timing wrong on rebound; Interview with Jim Rickards – Should investors prepare for a dollar doomsday?

SilverSeek:  Monetary collapse and silver’s not so orderly rise

The Economist/David Stockman: Central banks will be financing governments on a permanent basis; The ugly truth behind “jobs Friday

Mineweb/WSJ:  Gold manipulation – ex US Treasury top gun tells us how and why; Tocqueville Gold Fund says London probe could scare off institutional investors

Matt Taibbi interviewed on “The Daily Show,” and on NPR discussing his new book – “The Divide”

Fundamentally Golden

Posted by on April 8th 2014 in China, Federal Reserve, General Economy, Gold, India, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!


With gold and silver futures falling a fraction of a percent on Monday in what was described as “quiet trade,” Peak Prosperity’s Chris Martenson turns up the volume in laying out “The screaming fundamentals for owning gold.”  He concludes that “gold is one investment that you can park for the next ten or twenty years, confident that it will perform well …The punch line is this: Gold (and silver) is not in bubble territory, and its largest gains remain yet to be realized; especially if current monetary, fiscal, and fundamental supply-and-demand trends remain in play.” In January, Martenson was profiled on the PBS NewsHour, in a segment titled, “Sounding an alarm on economic dysfunction by practicing sustainable living.”

See also:

Dan Norcini/Got Gold ReportBreaking down the latest COT reports

Mineweb:  March gold imports jump to 10-month high in India; Frank Holmes – Gold price lift matter of time with Asian demand

Bullion Street/Arabian Money:  Japan’s gold bars, coins investment demand up by five-fold ahead of tax hike; 2,250 tonnes or 40% of the world’s physical gold trade passed through Dubai last year

Guardian/Sprott’s Thoughts:  Five signs that the global economic recovery may be an illusion; Jim Rickards:  Some kind of financial calamity is inevitable

Casey Research:  Global Gold’s Claudio Grass – The fiat money system is completely nuts

Jobs # Comes Up Short for Short-Sellers

Posted by on April 5th 2014 in CFTC, China, Federal Reserve, General Economy, Gold, IMF, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!


Gold and silver were said to have come “roaring off their oversold conditions” after Friday’s nonfarm payrolls report showed that 192,000 jobs were created in March.  Silver futures added 0.7% and gold futures jumped 1.5%, the biggest gain in three weeks, while stocks had what was described as a “brutal finale” to the week. “Everyone had been saying the job number was going to be so much better, but the economy didn’t improve the way investors had expected, and that’s why the short-sellers are covering their positions,” according to BullionVault‘s Miguel Perez-Santalla.  Gold and silver ended up a little less than 1% on the week, with gold closing at $1,303 an ounce and silver at $19.95.  With copper down 0.6% on the week, one analyst tells MarketWatch that “Falling copper prices are preventing the big rise in silver. We prefer to use caution for silver unless there is a convincing break of $20.45.”

See also:

Dan Norcini:  “Disappointing” payrolls number spurs gold buying

Wall Street Journal: The unemployment puzzle – Where have all the workers gone?

Zero Hedge:  Number of high wage jobs added in March: +2,000; The stock market is now exactly as overvalued as it was at the last bubble peak

Peter Schiff:  Meet “lowflation,” deflation’s scary pal

GoldMoney/Express Tribune:  Renewed estimates of Chinese gold demand; Pakistan refuses to sell $2.7 billion worth of gold says IMF

Casey Research/Of Two MindsThe Volcker Rule and you: What’s your bank doing with your money?; My wish for 2016: We finally get a president who doesn’t kiss Wall Street’s rear end

Metals Drop on Euro Weakness vs. USD

Posted by on April 4th 2014 in CFTC, China, Federal Reserve, GATA, General Economy, Gold, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!


In advance of Friday’s jobs report, spot gold and silver fell 0.8% and 0.5% respectively on Thursday, with the drop attributed to the dollar gaining against the euro, which fell 1% as ECB head Mario Draghi spoke at a press conference, in which he said “There was a discussion about QE, it wasn’t neglected.” But USA Gold’s market report points out that “While the dollar firmed intraday, gold did as well, giving a very preliminary indication that a launching of ECB asset purchases may ultimately supplant Fed tapering as the monetary policy story of the year…. the ECB is prepared to contort itself in whatever way deemed necessary to justify such purchases. It is also arguably a testament to the dire nature of Europe’s predicament.”

See also:

Daily Reckoning/Gold Silver WorldsExcess liquidity keeps the global economy afloat; If reflation is here, then gold is your ultimate hedge

Bullion Bulls Canada:  Is there any gold left for central banks to buy?

Coin Update/Coin News:  American Silver Eagle bullion sales jump in March, top 5.3 million

GATAReuters interviews Jim Rickards about gold’s ascent after ‘The Death of Money’; HFT controversy may lead to short squeeze in gold, Tocqueville’s John Hathaway tells KWN

Reuters/Of Two Minds:  U.S. futures regulator CFTC probing speed traders; It’s not just the stock market that’s rigged: the entire status quo is rigged