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

Gold and Silver Flip AM Script

Posted by on April 3rd 2014 in CFTC, China, Federal Reserve, General Economy, Gold, JPMorgan, Media, Monetary Policy, Quants, Russia, Short Sellers, Silver, U.S. Congress, Wall Street | Be the first to comment!


On Wednesday, silver futures gained 1.8% to finish above $20 an ounce for the first time since March 24, and gold futures added 0.8%.  Both went vertical at the open, and as Zero Hedge noted:  “Instead of the smack-down that we have seen around the 8 a.m. ET time each of the last 10 days, today gold and silver are spiking. It is unclear what the catalyst is – just as it is never clear what the catalyst for the monkey-hammerings are – but the timing with Putin’s retaliation threats (specifically against a major bank with a mysteriously active gold vault) suggest some causation.”

See also:

TF Metals Report/IRD:  Putin plays a golden card; The world slowly waves “good-bye” to the petrodollar

Wall St. Cheat Sheet/InvezzHere’s why you should buy silver; Commerzbank – Silver price decline may just be corrective

Peter Schiff/Bill Bonner:  The stealth rally – Gold under the radar;   America’s credit supercycle: The end is near

Reuters:  Bullion market eyes e-platform to revamp London gold benchmark

Bloomberg/Barron’s: Katsuyama, Narang, Lewis debate speed trading; Hedge funds are the real losers from high-speed trading

Mike Shedlock:  Supreme Court removes campaign caps; Worst congress money can bribe; Expect more divisive politics


Analyts Diff’r on Gold ‘Sentiment’

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


With gold and silver futures both slipping 0.3% on Tuesday, as stocks rose on what was described as “a record Fed-assisted window dressing operation,” Bloomberg cites an HSBC note concluding that the “near-term sentiment for gold appears negative,” with its recent decline “largely explained by the combination of receding geopolitical tensions and the Fed’s guidance for higher interest rates.” But according to two precious-metals strategists at UBS, gold’s “correction has been relatively orderly and interest to buy the dip is evident. This reflects the underlying improvement in sentiment towards gold – investors are acknowledging the value of holding gold to diversify portfolios and insure against tail risks and are therefore looking for opportunities to get in at better levels.”

See also:

321goldGold versus Silver

CNBC/Mineweb:  Why gold bears are watching U.S. payrolls; Analyst – Recent gold price decline surprising

John Rubino/Bloomberg:  Debt makes you dumb, Japanese edition; Yellen’s real-life examples of unemployed omit criminal records

New York/Zero Hedge9 gripes from a leading high-frequency trader about “Flash Boys“; HFT debate devolves into epic screamfest in milliseconds

Michael Lewis interviewed on “Fresh Air” and CNBC

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!


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!


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!


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 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!


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!


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!


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!


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