Metals Pare Q1 Gains, but Trump Stocks

Posted by on April 1st 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Janet Yellen, JPMorgan, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!

MetalsQ12014

After falling a fraction of a percent on Monday, gold and silver prices ended down about 3% and 7% respectively for March, but logged gains of 6.8% and 2% for the quarter. Reuters reports that “Gold largely ignored Yellen’s strong defense of U.S. easy-money policies on Monday, when she said the Fed’s ‘extraordinary’ commitment to boosting the economy will be needed for some time to come.” And MarketWatch cites a Naxis Metals Review report predicting a period of consolidation for gold and silver, “during which costs of production are likely to become a more important determinant of prices than the strength of demand,” but, “as these rising costs of production catch up with the (falling) price of gold and silver, so prices will form a base and eventually begin moving higher once more.”

See also:

Mineweb/In Gold We Trust:  Is Chinese gold demand really falling? Probably not; West to East gold exodus in full swing

Jesse’s Café Américain/SafeHaven:  Gold and silver charts – JPM throws down 229,400 ounces of gold to meet deliveries; A golden opportunity coming in silver

Commodity Trade Mantra:  The accidental end to silver price manipulation; Gold trading market is not “fixed” – it’s rigged

Mike Shedlock/Barry Ritholtz:  High frequency trading hits “60 Minutes” scrutiny – Trading or skimming?; High frequency trading is legalized theft

New York TimesReview – “Flash Boys” is “guaranteed to make blood boil”; Read an adaptation from the book

Gold Surprises; Michael Lewis Takes On HFTs

Posted by on March 29th 2014 in Federal Reserve, General Economy, Gold, Media, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!

FlashBoys

Although gold and silver ended down 3% and 2.5% on the week after logging a slight gain on Friday, gold beating U.S. stocks was seen as one of “The Top 10 Surprises of the First Quarter.”  And before spot gold closed at $1,294 on Friday, one analyst, looking ahead to next week, told Reuters that “If we don’t close below $1,290 today, we could see some consolidation around these levels ahead of the ECB on Thursday and U.S. nonfarm payrolls on Friday.”

And as it’s argued that last April’s gold smash was more about high-frequency trading, than say, garden variety market manipulation, Michael Lewis takes aim at the former in his new book, “Flash Boys,” which will be published on Monday. Lewis will be interviewed on “60 Minutes” this Sunday, and CNBC has some excerpts from the book, in which Lewis likens HFT’s to card counters in casinos, who only play when they have an edge:  “That’s why they were able to trade for five years without losing money on a single day.”

Gold: 6 Weeks vs. 6 Years

Posted by on March 28th 2014 in China, Federal Reserve, General Economy, Gold, India, Monetary Policy, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!

TheLongGame

With gold and silver both off a fraction of a percent on Thursday, and gold closing below $1,300 for the first time in six weeks, MarketWatch reports that gold’s drop was attributed to modest GDP growth and expectations that U.S. interest rates could rise sooner than expected, according to Sprott’s Charles Oliver.  But he’s also quoted as speculating that gold “could reach $5,000 during this decade as deficits and rising debts, exacerbated by demographic issues, are here to stay — and money printing and higher gold demand along with them.”

See also:

News Ledge/DanNorcini:  Gold and silver prices lose key levels on stronger dollar

SafeHaven:  Welcome to the Currency War, Part 14: Russia, China, India bypass the petrodollar

In Gold We Trust:  A first glance at U.S. official gold reserves audits

Citywire/BloombergGold bullion the only global meltdown safeguard, says asset allocator; Singapore’s SGX is said to consider plan for physical gold trading

Mining.com/APGold rush in Japan over impending tax rise; Drought spurs mini-gold rush in Sierras

Naked Capitalism/Barry Ritholz:  How banks fleece heirs on reverse mortgages; Attention suckers – Please send us your money

The Week:  Why America lags the rest of the developed world in retirement security

Less is More

Posted by on March 27th 2014 in Federal Reserve, General Economy, Monetary Policy, Quants, Wall Street | Be the first to comment!

LessIsMore

In presenting the above stunner, Zero Hedge observes that “The economic growth expectations for the world in 2014 just plunged to fresh lows at a mere 2.78% – that is 15% ‘less’ growth than was expected a year ago. The world’s equity markets are up 25% ‘more’ than at the start of 2013. Thus, our dysfunctional dystopian world where ‘less’ economic growth is ‘more’ wealth-creating. Long live the central bank utopia…”

Gold Off On Fed, Dollar, but China Seen Supporting

Posted by on March 27th 2014 in China, Federal Reserve, General Economy, Gold, Monetary Policy, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!

ChinaGoldImports2:14

Futures in gold and silver were off 0.6% and 1% respectively following positive U.S. economic news that “boosted speculation the Federal Reserve will further pare stimulus,” reports Bloomberg, quoting one market analyst as saying that “The durable goods number was stronger than expected, and that’s weighing on the market.  Further ideas that the Fed will move at a quicker pace toward tightening continue to be an overhang factor.” That and talk that “the ECB was moving in the direction of its own version of quantitative easing,” was seen as “enough to pull the rug out from underneath those buying gold out of any dollar weakness concerns.”

But following Tuesday’s news of a February surge in China’s gold imports from Hong Kong, after China allowed more banks to import gold, analysts at Commerzbank are upbeat about Chinese demand supporting gold, writing in a note: “Were China to maintain this tempo for the remainder of the year, last year’s record level (1,158 tons) could be achieved. China is thus likely to have contributed to the increase in the gold price in February — when gold rose by 6.6% — and will in our opinion remain an important crutch for the gold price as the year progresses.” And speculating on how much gold China actually does import, Jim Rickards explains why “even the best estimates may be too low.”

See also:

USA Gold:  April Fools’ drop dead date for the Volcker Rule – what it might mean for gold

Mineweb:   Silver cautiously waiting for gold to move higher; Total gold holdings in stark contrast to past decades and should change – WGC

SilverSeek/BullionVault:  Should I bet the house on silver?; Gold price vs. “flattening” yield curve

GoldCore:  Russia raises gold holdings by 7.2 tonnes to over 1,040 tonnes In February

NPR – Fresh Air/Reuters: How Crimea’s annexation plays to Russians’ Soviet nostalgia

Metals Inch Up; Iraq Goes For Gold

Posted by on March 26th 2014 in China, General Economy, Gold, Monetary Policy, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!

IraqGoldBuy

Spot gold and silver ended slightly higher on Tuesday as “analysts said that technical buying after a bullish ‘golden cross’ chart pattern provided underpinnings for gold,” reports Reuters, but the gains were seen as limited by Philadelphia Fed President Charles Plosser saying that “he believes the Fed should aim to raise short-term rates to 3 percent by the end of 2015 and 4 percent by the end of 2016.”

This as it’s reported that Iraq bought 36 tonnes of gold in March, which Bloomberg describes as the largest purchase by a country since Mexico bought 78.5 tonnes three years ago this month. “Demand from the likes of Iraq is important,” according to GoldCore’s Mark O’Byrne.  “It doesn’t necessarily mean it will lead to higher gold prices per se, but it definitely means that there’s an ongoing demand from central banks that is likely to continue.”

See also:

Tim Iacono:  Another curious (and pretty bullish) inflow for the gold ETF

Hard Assets Investor:  Gold market veteran – Hot money will come back into gold, sending prices to $1,900

Investing.comThe best geopolitical hedge? Gold and silver

Bloomberg/Livemint:  China’s gold imports from Hong Kong increase on import quotas

Zero Hedge/FortuneTwo shifting narrativesChina and the Fed; Jeremy Grantham: The Fed is killing the recovery

Gold Silver Worlds:  Will inflation make a comeback in 2014 when the consensus worries about deflation?

Hot Money Moves In, and Out, of Gold

Posted by on March 25th 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Janet Yellen, JPMorgan, Monetary Policy, Quants, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!

TheOldInOut-HotMoneyAndGold

Gold and silver futures ended off 1.9% and 1.2% on Monday, with gold’s fall attributed to the prospect of higher U.S. interest rates and a stronger dollar. In addition, MarketWatch cites a note from Commerzbank’s analysts saying that the drop was “due no doubt to further profit-taking after net long positions in gold were increased for the sixth week running in the week to 18 March.  At 121,100 contracts, they are currently at their highest level since the end of November 2012,” based on last Friday’s COT report.

But according to Dan Norcini, “Nearly all of those new longs were immediately under water as soon as the FOMC issued its statement last week. That and the fact that WWIII did not break out, as many of the perma gold bugs were predicting, was enough to turn the momentum back and that did it for the momentum-based funds. They are now selling.” And Bullion Vault‘s Adrian Ash adds:  “Buying gold we think is a smart idea. Chasing the price up…and then down…with gold futures and options is less clever. But it remains an ever-popular way of losing money for aggressive hedge funds and their formerly wealthy clients.”

See also:

ForexLive/Mineweb:  Will a golden cross save gold?; Gold uptrend to resume, silver ‘to rise faster’

Seeking Alpha:  Gold and silver could be in trouble

Bloomberg:  Silver vault for 600 tons starting in Singapore on demand

Zero HedgeMessage to the Fed - Here are a few things that you can’t do; In a world artificially priced to perfection, the imperfections appear

In Gold We Trust: Interview with Jim Rickards about his new book, “The Death Of Money

Wall Street on Parade:  Document – JPMorgan Chase bets $10.4 billion on the early death of workers

MarketWatch: ‘How Gold has Stomped the Competition’

Posted by on March 22nd 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Goldman Sachs, India, Janet Yellen, JPMorgan, Monetary Policy, Russia, Short Sellers, Silver, Ted Butler, Wall Street | Be the first to comment!

MarketWatchGold

“After a 28% price plunge in 2013, the worst since at least 1984, analysts weren’t expecting much from gold this year,” begins MarketWatch’s annotated slideshow on how “Gold is beating nearly every investment this year…. Many big banks were forecasting average 2014 prices below $1,300 an ounce, down from last year’s average of $1,413. But the precious metal has already managed to outperform U.S. stocks, bonds, emerging markets and the dollar.

Gold benefitted as two important sources of demand bought at the same time: Western speculators and Eastern savers, said Brien Lundin, editor of Gold Newsletter…. The metal’s performance has been impressive against a bevy of assets. But its path is far from set. Developments between Ukraine, Russia and the West are still fluid, and hints from Federal Reserve Chairwoman Janet Yellen that a U.S. interest-rate hike could take place sooner rather than later could make bond yields more attractive. Still, if you were one of those contrarians who were quietly bullish in January, we’ll forgive some back-patting. In seven charts, here’s a look at how gold has stomped the competition and what could come next.” ….Read More >>>  

See also:

Zero Hedge/Mineweb:  Goldman doubles down its hate on the best performing asset of 2014; Goldman’s blinkered view on gold could be so wrong

Dan Norcini:  Carnage in biotech sector provides support for gold

SilverSeek/Jesse’s Café Américain: Ted Butler – Suing JPMorgan & the COMEX; “My primary concern is a lack of transparency.”

CNBC:  Peter Schiff and Mark Dow do battle on gold

Zero Hedge/Asia TimesPetrodollar alert:  Putin prepares to announce “holy grail” gas deal with China; How Crimea plays in Beijing

The Hankyoreh/Bloomberg:  Official gold market to open in South Korea; Smuggled gold in flower pots defying India import limits

FOMC Meets Spell Weak Weeks for Gold

Posted by on March 21st 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Janet Yellen, JPMorgan, Monetary Policy, Quants, Russia, Short Sellers, Silver, Ted Butler, Wall Street | Be the first to comment!

FOMCweeksGold

Zero Hedge:  “What is more confidence-inspiring in the Fed’s ability to manage the world and the continued dominance of the U.S. dollar as global reserve currency than a falling gold price… and when better to show that than FOMC meeting weeks… welcome to the centrally-planned world where the announcement of ongoing trillions in fiat dilution constantly crushes the price of undilutable money.”

The above chart comes courtesy of Meridian Macro. Click on the “Gold & Silver Report (weekly)” button on the charts page for a free pdf sample of their March 14 offering.

See also:

Jim Rickards: Fed does not want ‘disorderly’ rise in gold prices

Reuters/MarketWatch:  Gold flat on Fed plans, easing Ukraine tensions; Gold, silver settle at lowest levels month to date

Dan Norcini:  Easing Ukranian tensions, hawkish Fed, undercut gold

STA Wealth Management:  What history says about Fed rate hikes

Mineweb:  Yellen knocks gold. Will Putin drive it back up again?; Silver imports soar 180% in India

Reuters/Ted Butler:  CME Group to launch gold, silver copper weekly options in April; The COMEX has developed into a ‘bucket shop‘ comprised of speculators

GoldSwitzerland:  Koos Jansen – China’s gold policy is one of the world’s most important developments

Yellen, Fed Rattle Markets

Posted by on March 20th 2014 in CFTC, China, Federal Reserve, General Economy, Gold, India, Janet Yellen, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!

YellenFedRattleMarkets

The Federal Reserve’s FOMC said in a statement on Wednesday that it will continue to taper its bond-buying program, and Fed Chair Janet Yellen suggested in a press conference that interest rates could begin rising six months after the bond buying ends later this year. Silver and gold ended down about 1% and 2% respectively, stocks tanked and the dollar surged.  Gold was off about 1.3% in the regular Comex session, and dropped an additional 0.7% following the announcement to reach $1.328 in after-hours trading .

One analyst told MarketWatch that gold “appears to have put in a near term high at $1,392 last week and may be vulnerable to a re-test of $1,300.  In the bigger picture, to the extent that the U.S. economy may stumble and/or stocks correct, gold should be the more favorable asset.” And USA Gold notes that “What remains to be seen is if QE3 does indeed get fully wound down this year. If the next — and overdue — recession strikes first, I’d guess not. This may well prove to be the best buying opportunity in the gold market so far this year.”

See also:

USA Today/Zero Hedge:  Stocks hammered by Fed announcement; Market in shock by Yellen’s first FOMC appearance

Tim Iacono/Reuters: Fed makes the price of everything go down; James Saft – Fed turns hawkish, or fumbles message

AP/CBC:  US, Russia exchange threats at tense UN meeting; Russian troops seize 2nd naval base in Crimea

Guardian:  The focus is on Crimea, but next is the fight for Ukraine

Mineweb/Reuters:  Gold smuggling explodes in India; India allows more banks to import gold in easing of curbs

 

Speculators Seen Booking Profits After Ukraine Run-Up

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

 GoldTalkingNumbers

Spot gold and silver ended off 0.6% and 1.6% respectively on Tuesday, on what was seen as a lessening of tensions over Ukraine.  “With geopolitical concerns easing and equities rallying, gold speculators have the perfect excuse to take profit at these elevated levels,” according to an analyst quoted by MarketWatch, who added the caveat that “I don’t envisage there to be further sharp falls for gold as the Russia and Ukraine story is unlikely to go away just yet.”

And in the above “Talking Numbers” segment, responding to a question about whether or not gold’s recent rally can continue, a technical strategist argues that “In fact, it is sustainable. We’ve been very bullish here on the US, but we’re seeing things are getting a little dicey out there from a global standpoint. Emerging markets are on the ropes right now. You’re seeing what’s going on in Russia. Even in Europe, the momentum is slowing. All of that continues to favor gold.”

See also:

Dan Norcini: Gold heads lower as longs bail out and bears move back in

Mineweb/Grant Williams:  West’s weak response to Crimea annexation knocks gold; Crimea River

Eric Sprott:  Deconstructing the U.S. economy: The non-recovery

SafeHaven:  Axel Merk – Fishing for gold?

Reuters:  Taiwan to allow banks to sell gold, silver coins from China

Metals Correct After Crimean Vote

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

PostCrimeanVoteCorrection

Gold and silver futures ended down about a half a percent on Monday with the losses attributed to a rally in U.S. equities that led to profit-taking, and what were seen as minimal sanctions against a small group of Russian and Ukrainian officials following Crimea’s vote to secede from Ukraine. Describing the sanctions as “a pretty tepid initial response by the west,” a USA Gold report notes that “the market seems to have turned its attention to the two-day FOMC meeting that begins tomorrow. This will be the first meeting presided over by new Fed chair Janet Yellen. The Fed is widely expected to hold steady on policy, and reduce asset purchases by an additional $10 billion per month.”

See also:

Bloomberg/The Daily Beast:  Putin moves to claim Crimea as West issues sanctions; Russia will sanction U.S. senators

Yahoo Finance/GATA:  Peter Schiff – Fresh highs for gold have nothing to do with Crimea; John Hathaway – Ukraine won’t move market as much as paper gold disparity

SafeHaven:  Monster silver rally brewing

GoldSeek:  Gold and silver – Start watching Fed’s fiat “dollar” more closely for clues

Zero Hedge:  Did the Fed’s John Williams just predict the next recession?; The global death cross just got “deathier”

In Gold We Trust:  New York Fed lying about gold storage

The Prudent Bear:  Doug Noland- A ‘Truman Show‘ world