Several weeks ago the entire precious metals space was extremely oversold and due for at the least, a reflex rally. Gold was down in nine of twelve weeks with Silver down in eleven of those twelve weeks. The miners experienced a nasty September and were down five consecutive weeks. With Gold rallying from $1185 to $1255, we would expect Silver and the mining stocks to rebound strongly in percentage terms. Full Story
As you can see, we’ve broken below four, the reading that has been triggered at every recession in the last 30 years. At best, we’re flat-lining. At worst we’re already in recession again. Don’t believe the hype both China and the US are making up their GDP growth numbers for political reasons. Neither will be a major engine for growth next year… Which means that the markets are completely mispricing what’s coming… and the stage is set for another Crash. Full Story
By: Adam Hamilton, Zeal Intelligence - 24 October, 2014
Battered silver remains deeply out of favor, recently plumbing miserable new lows after drifting sideways for most of 2014. This metal’s relentless and oppressive weakness continues to break the wills of long-suffering contrarians. But professional investors are taking advantage of the epically-bearish psychology plaguing silver. They’ve been steadily accumulating positions all year long in massive stealth buying. Full Story
By: Laurynas Vegys, Research Analyst - 24 October, 2014
With a long-term time frame in mind, whatever happens in the short term is less of a concern. Building substantial positions at good prices in great companies in advance of what must transpire sooner or later is what successful speculation is all about. This is how Doug Casey, Rick Rule, and others have made their fortunes, and it’s why they’re buying in the market now, seeing market capitulation as one of the prime opportunities of the decade. Full Story
By: Steve St. Angelo, SRSrocco Report - 24 October, 2014
As the increasingly volatile stock markets bounced back higher today, JP Morgan experienced one of the largest withdrawals of gold from its inventories this year. In just one day, a stunning 321,500 oz of gold (10 metric tons) were removed from JP Morgan’s Eligible inventories. Full Story
Behind the scenes (or rather, behind the curtain of propaganda) the most influential of the banking class is sending out smoke signals. The Bank for International Settlements (BIS), which is the bank for central banks, has telegraphed the next major world financial downturn. Full Story
The behaviour of financial markets these days is frankly divorced from reality, with value-investing banished. Markets have become distorted by Rumsfeld-knowns such as interest rate policy and "market guidance", and Rumsfeld-unknowns such as undeclared market intervention by the authorities. On top of these distortions there is remote investing by computers programmed with algorithms and high-frequency traders, unable to make human value-assessments. Full Story
By: Chris Powell, Secretary/Treasurer, GATA - 23 October, 2014
The last two months have brought confirmation that, as we long have suspected, GATA has outlined only a small part of the surreptitious market manipulation being undertaken by central banks -- that this manipulation is actually comprehensive, that it covers nearly every major market in the world. This confirmation is largely the work of Eric Scott Hunsader, founder of the market data and research company Nanex in Winnetka, Illinois, who publicized, through the Zero Hedge Internet site, documents recently filed with the U.S. government, two of them with the Commodity Futures Trading Commission and one with the Securities and Exchange Commission. Full Story
The Quantitative Easing initiatives have been declared as stimulus and successful in sustaining the US financial system. While having been able to continue the debt floats, the many market props, providing coverage for USGovt debt securities and mortgage backed securities which nobody wants, the initiative is hardly stimulus. The hyper monetary inflation does what we always learned it did, as in from school for 50 years, dole out its powerful corrosive effect. Full Story
IBM went down hard on its quarterly earnings report this week. This made a splash in the news because, well, it’s IBM, and also Warren Buffett owns it, so it was a rare moment of human fallibility for him. But there is a lot more to the story than that. Very sophisticated people have been keeping an eye on IBM for some time. Full Story
I featured the thinking of Dr. Lacy Hunt on the velocity of money and its relationship to developed-world overindebtedness and the potential for deflation in this week’s Thoughts from the Frontline, and I thought you’d like to peruse Lacy’s entire recent piece on the subject. Full Story
Nelson Bunker Hunt, the Texan oil billionaire whose cornering of the silver market in the late 70s took the silver price to what is still its all-time high of $50 an ounce has died at the age of 88 in a care home. Full Story
Unlike Jack Nicholson’s character in A Few Good Men, we trust that you can handle the truth. No matter your age, securing a comfortable retirement is a huge concern. Folks want the whole truth about their financial outlook, but straight answers are hard to come by. Full Story
By: Steve St. Angelo, SRSrocco Report - 23 October, 2014
While the Fed and Western Central Banks continue to prop up the entire market, investors took advantage of the manipulated low silver price by purchasing a record amount of Silver Eagles in October. Silver Eagle sales were also extremely strong last month as total sales reached 4.1 million in September. Full Story
Lets start off the Wednesday Report by looking at several currencies that broke out today. As you know the Eruo has been one of the weakest currencies out there. Today’s breakout of a bear flag confirms there is more downside to come. This first chart is a daily look which shows the Euro formed a H&S top in the first half of this year and broke down sharply in late July. The Euro has been chopping out the blue bear flag for most of October which broke down today with a breakout gap. Full Story
The number one law of economics is supply and demand. Nowhere on this chart is that reflected, NOWHERE. What you see is an almost doubling in price of silver as the dollar fell 10% against a basket of currencies. Since that time the price of silver and gold have done nothing but go down because the dollar has gone up. Full Story
Investing is about piecing together different bits of information into an illustrative picture—sort of a Wall Street version of the connect-the-dots game we played in kindergarten. That’s why the headline below from Bloomberg made my investment antennae stand up and motivated me to look for either confirmation that the real estate market was indeed slowing down or contrary evidence to explain if the weak summer sales numbers were just a temporary aberration. Full Story
A swan dive in commodity prices followed by the latest stock market correction has investors talking about the “D word” once again. References to deflation abound in the news while economists seriously discuss the possibility of a global economic recession. What, they ask, will it take to arrest the slowdown in the euro zone and China and prevent its coming to U.S. shores? Why central bank intervention, of course! Full Story
According to the most recent data from the World Gold Council, Switzerland has 1,040 tonnes of gold bullion in its reserves, equal to only 7.8% of its total reserves. (Source: “World Official Gold Holdings,” World Gold Council web site, last accessed October 16, 2014.) To bring its gold bullion holdings to 20% of total reserves, the central bank of Switzerland will have to buy 1,600 more tonnes of gold, or about 60% of all global mine output this year. Will the gold market be able to handle this kind of demand shock? I highly doubt it. Full Story
Governments respond to problems with more spending (stimulus), central banks support the bond and stock markets (QE), and we pretend debt and deficit spending can increase forever (delusional). The U.S. official national debt is nearly $18,000,000,000,000. Occasionally a 1987 or 2000 stock market crash occurs, a 9-11 event changes the world as we know it, a housing bubble deflates, and major wars are created. Full Story
An interesting article on MarketWatch today caught my attention. The subhead is the money quote, “Back in April every economist in a survey thought yields would rise. Guess what they did next.” Every? The article refers to 67 economists polled by Bloomberg, all of whom would seem to believe in the quantity theory of money. This means they believe a rising money supply causes rising prices. That means they think the bond market expects inflation. Which means they expect the interest rate to rise, because investors will somehow demand more. Full Story
The argument of "stock versus flow" has been debated from many angles and across many asset classes. The most heated may be in the gold and silver bullion categories. I've written on this topic before and I'm sure I will again but for this exercise I want to talk about U.S. stocks. Zero Hedge put out a piece yesterday reporting that JP Morgan E-Mini Liquidity Has Crashed 40% In The Past Quarter, JPMorgan Finds | Zero Hedge says liquidity has dropped 40% in the S+P E mini contract. The study looks at "depth" of both bids and offers, this is now drying up, in fact, the ramp upwards was performed on continually lower volume. Full Story
Timing is everything in investments, and after watching the precious metals markets for the past three months, since the publishing of his last article at the June lows, Peter draws the conclusion that gold bullion and gold mining stocks have finally bottomed and are ready to resume the bullish trend than began twelve years ago. Full Story
While all “systems are go” for the precious metals sector, or at least appear that way, things are substantially more questionable for the world’s stock, bond, and real estate markets. Full Story
Briefly: In our opinion speculative long positions (half) in gold, silver and mining stocks are justified from the risk/reward perspective. Yesterday, gold closed higher than it did in the previous several weeks, which seems like a very bullish development for the entire precious metals market until one realizes that miners are still close to their most recent lows. Full Story
It’s been over 3,280 days since a hurricane hit Florida. As hurricane season comes to a close next month, only Mother Nature knows how long the streak will last. Like many Floridians, my wife and I stayed home and rode out a hurricane—once! We’d built a home on Perdido Key, a barrier island west of Pensacola. It was engineered to withstand 150-plus mph winds, and it was a beautiful home with a master bedroom spanning the entire third floor, looking out across the Gulf of Mexico. Full Story
As I wrote yesterday, markets have become schizophrenic and volatility has exploded. It is obvious the uncertainty regarding "QE" (monetization) is at the heart of this renewed volatility. I do want to mention and remind you of past crashes and vicious bear markets, they ALL have seen big volatility (in both directions) prior to the collapse. 1929, 1987, 2000, 2008 ...they all experienced big swings in the market prior to the big declines, this is what I believe we are experiencing now. Full Story
Longtime readers will recall that we've been covering the ongoing depletion of the GLD since early 2013. After today's massive withdrawal, the total alleged "inventory" of the GLD now stands at a multi-year low of just 751.96 metric tonnes and down 5.8% on the year. This while the paper price of gold is actually up on the year by nearly 4%. Full Story
Since at least the beginning of 2006, the most asked question I get after a speech is “Do you think we will have inflation or deflation?” In an attempt at humor, my answer has been “Yes.” I go on to try to explain that we are in a deflationary environment, but eventually we will see inflation. When QE1 was announced, there were many pundits (none of the Keynesian variety) who immediately said the risk was for significant inflation, and there were even those (like Peter Schiff) who talked of hyperinflation and the demise of the dollar. Interest rates would rise, and US government bonds would collapse. Full Story
The expectation gap crashed close last week - with all the subtlety of an elephant standing and leaving the room. All it took was a four week tour on the weak side of positioning, to panic participants out of their misplaced policy expectations of impending rate hikes by the Fed next year - or an imminent breakdown in the government bond market. Shortly after the equity markets opened Wednesday morning, Full Story
We can’t speak about the manipulation of the gold price today without understanding the derivatives market. Right after the crash of 2000 in the stock market I became alarmed by the exponential increase of derivative products but especially by the complexity of those products. I am sure that if I asked one of those financial engineers who has designed those products to explain their functioning and consequences in a bear market or, better yet, in a crash, he would be incapable. We are familiar with derivatives in real life through cars. Full Story
A good government and healthy society is one which encourages courage, honesty, values and thrift. Borrowing and living beyond your means is not a sign of a healthy society. It also indicates that something is wrong in the way in which the state is being governed. Full Story
The United States is doing better than it has in years. Jobs growth is up, unemployment is down, our manufacturing sector carries the rest of the world on its shoulders like a wounded soldier and the World Economic Forum named the U.S. the third-most competitive nation, our highest ranking since before the recession. As heretical as it sounds, there’s a downside to America’s success, and that’s a stronger dollar. Although our currency has softened recently, it has put pressure on two commodities that we consider our lifeblood at U.S. Global Investors: gold and oil. Full Story
Could an infectious disease kill the monster that has been choking gold and silver prices for more than a year? On the heels of a lively Sprott Precious Metals Roundtable discussion, The Gold Report caught up with investor Eric Sprott to ask how a tragedy in Africa could impact the price of precious metals and mining stocks. We also spoke to his Executive Vice President of Corporate Development John Ciampaglia about a new way to gain exposure to gold. Full Story
By: John Browne, Senior Economic Consultant at Euro Pacific Capital - 20 October, 2014
As territory in the Middle East falls under control of the brutal fanatics of ISIL, many Americans may be wondering how this could happen in the backyard of major U.S. allies. In particular, frustration with Turkey's reluctance to move against ISIL, even as it massacres civilians and creates instability on the Turkish border, is growing rapidly. Turkey's political calculation with respect to the crisis reveals just how complex and intractable the crisis may become. Full Story
We just finished a wildly volatile week in most all markets across the entire world. Stocks were dumped early and then pumped at the end of the week, interest rates were dumped until the end of the week and oil simply crashed and actually "sniffed" at a "7" handle. Greece came completely apart at the seams with their stock market and bond markets collapsing. Full Story
By: Steve Saville, The Speculative Investor - 20 October, 2014
That gold mining has generally been a crappy long-term investment for almost five decades is evidenced by the following chart. The chart, much of the data for which were provided by Nick Laird of www.sharelynx.com, shows the ratio of the Barrons Gold Mining Index (BGMI) and the US$ gold price from 1920 through to the present*. More specifically, it shows that, relative to gold bullion, the group of gold-mining stocks represented by the BGMI has been in a secular decline since 1968 and is now close to its lowest level since 1948. The question is: Why have gold mining stocks performed so poorly for so long relative to the metal? Full Story
•A global currency bubble insures that gold will climb the proverbial "wall of worry" in 2014. •Although US equities continue to attract momentum capital, eventually the bubble with pop, directing sizable funds into the PMs sector. •The standoff in Ukraine represents a new economic cold war, further eroding dollar hegemony. Full Story
In what pretends to be a history looking back from the future ‘Currency Wars’ author and fund manager Jim Rickards argues that by 2020 all the gold of the G-20 nations will be confiscated and buried in a former nuclear bunker under a mountain in Switzerland to take it out of the global financial system. Full Story
By: Steve St. Angelo, SRSrocco Report - 19 October, 2014
According to the financial media, the global economy is supposedly rolling over causing a glut of inventories producing a deflation in the prices of many commodities. If this is the case… someone should tell that to King of base metals… Copper. Something doesn’t seem to be making sense in the copper market as the price continues to decline, so are the level of global copper inventories. You would think the opposite would be the case, but we must remember in the new Financial Paradigm — Paper assets such as Derivatives, Stocks and Bonds are KING, while Gold-Silver and commodities are GARBAGE. Full Story
Take heart PM community, your turn is coming. What is happening in the stock market is a harbinger of what is sure to come for gold and silver, at some point in the future. When? Ah, that elusive question the answer to which so many want to know, the same answer to which so many so-called prognosticators have serially gotten wrong over the past few years. The best answer is patience. Full Story
A wild, tough week that saw some major declines and large swings. I did say here last week that “Cash is the most important position to take at times and now is that time.” Subscribers get much more detailed information on a nightly basis and we did hit a few shorts this past week that worked, but only in small size. Full Story
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