It has been a strong start to 2016 in precious metals, today notwithstanding. Gold was able to break above daily resistance at $1080 to $1090 while miners climbed higher until Friday’s reversal. Rather than focus on the nominal gains I want to turn our attention to Gold’s performance against other markets and asset classes. It is starting to turn in Gold’s favor and that is imperative if the precious metals bear market is to end in 2016. Full Story
It is important to distinguish the ‘back end’ from the ‘front end’ of the economy or else all you end up with hype emanating from the financial sphere every time an economic data release comes out. For example, I was critical of Martin Armstrong’s post, Is the recession Starting? in a rebuttal post, Armstrong 3+ Decades Late on Manufacturing because Marty’s post not only brought back some jaw droppingly old fashioned concepts about US manufacturing (JiT and automation replacing labor) but it focused only on the ‘front end’ of the economy, affirming the “ECM” in a short info-blurb. Full Story
We might get a bounce here to retest that green line, but unless a major Central Bank launches a new monetary program stocks are heading DOWN. Indeed, in the BIG Picture it looks more and more like the bull market for stocks is over. The last hope for the bulls is that we hold critical support on the monthly SPX 500 (the green line). Otherwise it’s GAME OVER. Full Story
By: Chris Powell, Secretary/Treasurer, GATA - 8 January, 2016
Bernanke's commentary offered four explanations for the dollar's primacy as the world reserve currency: the dollar's stable value, the liquidity of U.S. financial markets and the market for U.S. Treasury securities, the safety of dollar assets and particularly the safety of U.S. Treasury securities, and the Federal Reserve's functioning as the lender of last resort. Full Story
By: Adam Hamilton, Zeal Intelligence - 8 January, 2016
The world’s financial markets changed dramatically entering this young new year, led by sharp stock selloffs and a mounting gold rally. These are major reversals from recent years’ action. The immediate catalysts were China’s plummeting stocks and ongoing yuan devaluation. But the far larger underlying driver is the Fed’s first tightening cycle in a decade, which is just starting to unwind years of gross distortions. Full Story
Tops occurred about every seven years. Tops were usually rounded, followed by intense drops. Tops were approximately Aug. 1987, Jan. 1994, March 2000, Oct. 2007, and May 2015. Once the SPX broke below the red up-trending support lines in 2000, 2007, and (probably) in 2015, the rally was over and large corrections occurred. The next large move in the SPX looks like it should be, based on history, a substantial correction to the 600 – 1,400 range. Full Story
Gold has now been in a bear market since September 2011. Major central banks in the advanced economies have implemented policies that have covertly suppressed the gold price, while they have overtly inflated asset prices. This has led to valuation extremes in all asset markets, including gold, that would never be seen in free markets backed with sound money. We can be certain that today's unprecedented build-up of price distortions will be corrected eventually by market forces, probably in the coming months. Full Story
Chairman of SchiffGold.com, Peter Schiff returns to the show with dire warnings of a looming currency crisis. His work indicates that eventually, momentum will return to the gold market, making $100+ days commonplace culminating $5,000 gold. The multi-year bull market in stocks may be viewed in retrospect as a Fed fomented bubble, which crushes million of retirement portfolios. Full Story
By: Steve St. Angelo, SRSrocco Report - 8 January, 2016
If we look around the majority of the market today, not much is up besides gold and silver. Not only is the Dow Jones down big time, so are the SPX 500 and Nasdaq. Hell, even oil is lower by more than 2%. What we have here is gold and silver floating up nicely in a sea of RED. Oh, by the way… the U.S. Dollar is down a hefty 100 basis points. Well done. Full Story
If you don't have a magical crystal ball to see the future, then a good history book will do the job. Understanding the past offers a full color panorama to the dangers and opportunities facing you in 2016. Unpayable debt is becoming the Big Story of the 21st Century across the globe. Life-altering disruptions will be the norm, with little that mankind has not seen before. Full Story
Chris welcomes back Jim Rogers from his Singapore office, who says a financial crisis is imminent. His largest currency position remains the US dollar, which will likely rally into a bubble which eventually implodes in spectacular fashion. Although not a safe haven, the US dollar seems impervious relative to most global currencies, for the moment. Full Story
Wednesday felt like an inflection point in gold and the INDU with both breaking important trendlines. As there is alot of ground to cover tonight lets get right to the charts starting with the daily look at the INDU. Today the INDU finally closed below the bottom rail of the now seven point bearish falling flag and the double bottom trendline at 16,920. This was a big deal IMHO. We may see a little backing and filling in this general area but today’s move clearly setup a pattern of lower highs and lower lows. Full Story
It is now quite clear in light of former Fed governor Fischer that the Fed’s whole idea was what we conspiracy people said it was all along, blow a massive equity bubble. But the question now is what happens next? In light of how stocks are reacting to this $/yen chart it would appear chaos is about to reign. Full Story
Gold bulls have suffered years of disappointment, having seen their favorite metal’s price lose more than 40 percent from its all-time historic high of $1,924 an ounce in early September 2011. Last year alone the price of gold fell some 10 percent, leaving many investors, analysts, and financial-market pundits despondent about the prospects for gold in this New Year. Full Story
The SPX 500 has been bending over the last three trading sessions ( first three trading days of this New Year) but refused to break down. Overnight however, that has changed, at least during Asian trade and very early European trade. Notice how the index has dropped below the 2000 level twice to start the year but always managed to close back above that level. On Wednesday, the market broke down below that key 2000 level but rebounded heading into the closing bell to avoid managing to close below the spike lows in December and on Monday of this week. Full Story
Yesterday’s choppy rally exceeded the bullish target at 1091.10 that we’d been using to predict the course of this latest buying spree. The clear implication is that even higher prices lie ahead over the near-term. The move is especially encouraging because the target, a Hidden Pivot resistance, was a fairly important one — the highest I could have projected using the hourly chart. Now, I’ll suggest setting an alert at 1098.10, a single tick above an important ‘external’ peak recorded on November 16. A print at that price would energize bulls for a push that could dwarf the very modest rally that has occurred since gold bottomed in mid-December near $1045. Full Story
In a dynamite interview, Richard Fisher, former president and CEO of the Federal Reserve Bank of Dallas, gave what may be the biggest confession of recent financial history: the Federal Reserve knowingly engineered the US stock market recovery and created a huge asset bubble that is certain to collapse. Full Story
The sector is not being followed actively, in fact, the crowd is ignoring it, and this is usually the best time for the astute investor to plan an entry. Mass psychology states that you should be happy when the crowd is wary and wary when they are happy. Investing in the energy sector has been an exercise in futility in 2015 for the most part, but there appears to be a bright spot. We would wait for the oil tanker sector to pullback before committing any new money to this sector. The current market pullback should provide investors with lovely entry points in some of the top performing stocks in this sector. Full Story
I’m not getting excited about the metals until gold really starts to move – as in shoots up into the mid-1000’s. China/India/Russia combined imported over 3,000 tonnes in 2015. Global production was likely around 2400-2500 tonnes. How are the sellers of this gold making deliveries? Hemingway said that you broke slowly then suddenly. The same dynamic will apply to the initial spike up in gold. Gold is being inexorably held down by fraudulent paper derivatives. Full Story
Based on the title, you might be guessing "who said what"? It could be thought we are discussing one of the many ridiculous quotes by Jim Cramer. His latest was a rant about how our market should not be down this morning "because" North Korea allegedly lit off and tested a nuke. He went on to say "look at earnings, they can't be the problem, Monsanto and Sonic beat handily"... Really? Good earnings at Sonic are a sign of economic and financial health? Full Story
By: Chris Powell, Secretary/Treasurer, GATA - 6 January, 2016
The Perth Mint's Bron Suchecki today notes that gold inventories on the New York Commodities Exchange are not necessarily a good indicator of tightness in the gold market, since "eliglble" gold -- gold in Comex warehouses -- easily can be converted to "registered," gold available for delivery against Comex contracts. Full Story
In 1983, my friends and early mentors Seymour Schulich and Pierre Lassonde founded Franco-Nevada Mining, the world’s first gold royalty company. The two uniquely gifted money managers were on to something big. It was originally Seymour—then an oil analyst at the Canadian investment firm Beutel, Goodman and Company, where he and Pierre met—who recognized that the royalty model used in the oil and gas industry had some of the highest returns on capital. Full Story
There is a populist idea of money printing. The idea is that banks can just print what they want, enriching themselves in a massive fraud. But, does it really work this way? Let’s start with a simple case, which is clearly not money printing. We will build a series of examples by adding one element at a time, working our way up to banks, and the central bank. Then we can examine this idea of printing. Full Story
The Financial Repression Authority sees the massive government tax grab already quietly underway accelerating in 2016 in most of the developed economies. This ‘grab’ will be a desperate political act driven by underfunded, and in a significant number of cases, unfunded public pension which will unfold at all three levels of government, Federal, State and City /Local government. It will be disguised by different focal emphasis and appear to evolve in an uncoordinated manner – but it will occur! Full Story
They say that insanity is doing the same thing over and over, but expecting a different result. So, according to this definition, this 4+ year correction has clearly afflicted this market with a bout of insanity, and much of it has culminated in 2015. So, do you want to join the insanity, or rise above it? Full Story
By: Steve St. Angelo, SRSrocco Report - 6 January, 2016
Again, something very strange is happening here. The Comex continues to see a drain of its Registered Silver inventories (for delivery), while the SHFE inventories are showing a rapid increase. It will be interesting to see what happens to the silver inventories at these two exchanges over the next 6 months. If Comex Registered Silver inventories continue to fall (just like the Gold Registered inventories), this could spell more trouble for the highly leveraged paper based precious metal markets going forward. Full Story
Today, I present new research covering a 20-year time frame from 1996-2015 that includes a 12-year bull market for gold from 2001-2012 bracketed by bear markets in the late 1990s and mid-2010s. In a series of normalized charts, I will show that regardless of overall year-over-year bull or bear market conditions, there are predictable intra-year trends in the gold price. The first series of charts shows the percentage change in the daily gold price normalized to January 1 for each year from 1996 to 2015. Full Story
The Chinese market lost half a trillion dollars of value on Monday, and trading only stopped plummeting when one of the old safety brakes kicked in. That brake closes the market if a decline reaches 7%. Chinese factory data also fell for the tenth month, and fell further than expected by economists. Monday’s wipeout leaves China now stuck on how to unwind the safety mechanisms that effectively socialized the market and ended nearly all of its freedom. Full Story
The US government will spend nearly $4 Trillion this fiscal year – starting last October 1. Of course it projects a massive deficit, increasing national debt, uses “funny” accounting, and does not address unfunded liabilities. Business as usual… Examine the last 100 years of US government expenditures and national debt – on a log scale in $ millions. Note that official government expenses have increased from about $750 million to about $4 Trillion, an increase by a factor of over 5,000. Full Story
Obtaining a second passport is a fundamental step toward freeing yourself from absolute dependence on any one country. Once you have that freedom, it’s much harder for any government to control your destiny. No matter where you live, you can benefit from the political diversification that comes with a second passport. Full Story
By: Steve Saville, The Speculative Investor - 5 January, 2016
I’ve seen articles explaining that rising interest rates are bearish for gold and I’ve seen articles explaining that rising interest rates are bullish for gold, so which is it? Are rising interest rates bullish or bearish for gold? The short answer is no — rising interest rates are neither bullish nor bearish for gold. Read on for the much longer answer. Full Story
The short gold trade is even more crowded. Current COT positioning is the most bullish it has been in the past 15 years. I’ll repeat that. Gold positioning is the most bullish it’s been in 15 years. The potential for a sizable short covering rally is very good. If the USD meme changes on the back of that as I expect we may finally have the bottom we’ve waited for. Most traders are still waiting to see a “trigger” for that move. If the SPX really rolls over as I think it may soon, that could well be it. Gold could be the place to be again very soon. Full Story
I guess you can call it a case of “Hope Springs Eternal” when it comes to the large specs and their bullish oil posture because other than that, I have no explanation why they are so other than the fact that in the past, crude oil tended to hit spike lows and then rebound. The problem is that this time around, US production is showing no signs as of yet of being sharply curtailed – at least curtailed enough to make a dent in the supply glut. Full Story
Going forward, gold prices will largely be affected by U.S. monetary policy. The Federal Reserve began its interest rate-normalization process with a small but significant 0.25 percent increase, and unless the Fed has reason to mark time or reverse course in 2016, rates should continue to rise steadily. Full Story
At yesterday’s lows, the stock market’s exhilarating plunge may have felt like an avalanche. From a calmly dispassionate technical perspective, however, it was just a tightly controlled shakedown designed to manage, and to make the most of, the nasty selloff that had occurred overnight in Chinese markets. In fact, the opening bar was so deep-in-the-hole that sellers were all but spent before the regular session got rolling. This made it possible for DaBoyz to accumulate shares at fire-sale prices, then to run those shares back up the old wazoo for a quick-turn distribution at profitable prices. Full Story
Precious metals investors heading into 2016 worry the dollar will continue marching ahead, right over the top of gold and silver prices. The Fed is telegraphing additional rate hikes throughout the year, and commodity prices – led by crude oil – are falling. There have been tremors in the biggest beneficiary markets of all when it comes to the Fed's QE largesse – U.S. equities and real estate. And the possibility of a recession is growing, both in the U.S. and around the world. Full Story
2015 was a very interesting year in its own right, the way it finished was even more interesting. As the year progressed we saw global trade, GDP and earnings weaken significantly. We saw unprecedented rhetoric geopolitically while central banks and sovereign treasuries became suspect from both credibility and in some cases solvency points of view. Full Story
If you were to ask everyday people out there today if life was getting too complicated for them, it’s my belief they would come back with a resounding consensus of ‘yes’. And it’s not hard to see why. In the first place the nanny state has put critical thinking by most people to sleep, where unfortunately far too many literally don’t know their collective ‘ass from their elbows’ anymore. Full Story
Throughout 2015, “Free Cash Flow” has become the new mantra in mining. Analysts are now paying a close attention to free cash flow – a measure that was largely ignored in the past few years in spite of the well-known fact that mining companies are ”price-takers” in an ever-cyclical environment. Major miners value proposition to investors was always focused on something else — optionality, net present value, resource base growth and production growth… Full Story
We've previously identified the "final piece of the puzzle" to be a bearish cross of the 24-month moving average by the 6-month moving average. As you can see below, this cross immediately preceded the market crashes of 2001 and 2008. The gap between the two MAs was as wide as 200 points when 2015 began. It's now 35 and narrowing fast. We'll keep watching this all play out, of course. In the meantime, you should probably consider forming an exit strategy for your equity investments if/when these lines do cross. Full Story
Some big names still have big holdings in gold. The Moltly Fool points out that John Paulson and his hedge fund group Paulson and Co. own about $900 million worth of shares of the SPDR Gold Trust. Another investor showing confidence in gold is Ray Dalio, founder of Bridgewater Associates, who has said, “If you don’t own gold, you know neither history nor economics.” Paulson and Dalio seem to be demonstrating gold’s use as a hedge against uncertainty in fragile markets. Full Story
Chris welcomes back Bob Hoye, senior investment strategist of Institutional Advisors, who wishes every listener a Happy New Year. The economic endgame could be near - central bank policymakers are using every method possible, including negative interest rates and QE. His models suggest a paper asset crash is inevitable, it is merely a matter of time. Timing the event is challenging and will represent a sea-change in economics worldwide. The tipping point could stem from the Junk Bond market, where soaring yields have crushed prices, potentially threatening the higher rated debt market. Full Story
As we approach the end of the year we are going to review one of the most extraordinary divergences that we have witnessed in modern times. This is very important because once you grasp the magnitude of this divergence and what it implies, you will be able to position yourself to firstly avoid harm and secondly capitalize on a reversion to the mean of this divergence, which, because it is so extreme, looks inevitable. Full Story
Many analysts will point to the August sell-off as the reason stocks performed so badly, however, looking at the chart, stocks struggled throughout the year, long before the August sell-off. Indeed, at best the SPX 500 was up 3% for the year! Things are only going to worsen from here. Full Story
We are interested in the changing equilibrium created when some market participants are accumulating hoards and others are dishoarding. Of course, what makes it exciting is that speculators can (temporarily) exaggerate or fight against the trend. The speculators are often acting on rumors, technical analysis, or partial data about flows into or out of one corner of the market. That kind of information can’t tell them whether the globe, on net, is hoarding or dishoarding. Full Story
We believe the Credit Cycle has turned and with it will come some massive unexpected shocks. One of these will be the fall out in the Bond Market, centered around the dramatic growth explosion in Bond ETFs coupled with the post financial crisis regulatory changes that effectively removed banks from making markets in corporate bonds. It is a ‘Witch’s Brew’ with a flattening yield curve bringing it to a boil. Full Story
I must be bearish the Semi Equipment sector because I am short both LRCX and AMAT; the former a successful NFTRH+ long position that hit target and found resistance as anticipated by this chart originally included with the update. I am not so worried about the gap because it changed the trend and gaps that alter the trend of a stock can take a long while to fill. Full Story
Lots of chop for markets as we wound down a so-so year. Setups are forming and traders will return this coming week so volume will pick back up and if all goes well, leading stocks will begin to breakout higher with markets following as this bull market continues on. The metals continue to act poorly and do not yet look to have put in their major lows, but they are getting closer to major support. Full Story
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