PM Fund Manager Explains How Bullion Banks Can Continue PM Manipulation

The following video was published by SilverDoctors on Oct 10, 2014
PM Fund Manager Dave Kranzler joins us this week for a power packed show discussing:
1. Triple Bottom or Dead Cat Bounce? The outlook for gold & silver over the next 6 months 2. Physical silver update- demand explodes as more physical sold in the first week of October than all of July & August! 3. Giant House of Cards- why the fundamental economy has been completely rotted out 4. Kranzler explains that the banks have been able to continue manipulating silver futures far longer than expected because only 2% of futures contracts ever stand for delivery 5. No other commodities market in which the amount of outstanding futures contracts to the underlying deliverable is so out of balance- this would all end if the longs would simply STAND FOR PHYSICAL DELIVERY

Harvey Organ’s Gold and Silver Blog Taken Down Exactly One Month After Predicting 2014 End Game For Silver Suppression

Several patrons have asked me if I know what has happened to Harvey Organ’s popular precious metals blog.
I have been given to understand that his site on Google blogger has been ‘deleted by court order’ and in accordance with Google’s terms of service and content policy.
The specific terms of the court order or the originator have not been revealed to me.
I had thought Harvey’s blog was fairly benign, and Google has been fairly easy to work with based on my own experience.
Things like this generally involve either alleged copyright infringement or some sort of defamation. Harvey was based in Canada, and I do not know if Canadian laws on this are different than US laws, or even which jurisdiction issued the court order. I do not care to speculate. This is all that I know. If I find out more, which I hope will be the case, I will pass that along.
You may find some ‘back issues’ of Harvey’s blog on the Internet Archive here.
We’ll always have Paris. Here’s looking at you, kid.

This post was published at Jesses Crossroads Cafe on 10 OCTOBER 2014.

5 Reasons Why The Gold Price Could Have Bottomed at $1,180

The yellow metal has fallen nearly 40% from its 2011 high above 1900 to trade below 1200 at the start of this week, mirroring Columbus’s own fall from grace as more of his transgressions have been brought to light. We want to highlight five reasons that gold may not be irreparably damaged:
1) Strong Previous Support at 1180
The first and most obvious reason that gold may bounce from here is that it tested strong previous support at 1180 earlier this week. This support level put a floor under the metal’s price in both June and December of 2013, leading to a 200 point rally in each case. While gold has been putting in a series of lower highs over the last few years, a bounce back toward at least 1300 is possible off this key floor.
2) Bullish Gartley Pattern Projects a Rally off 1180
In addition to representing a key level of previous support, the 1180 level also marks the completion of a multi-month Bullish Gartley ‘222’ pattern. For the uninitiated, this formation is named after the author (H. M. Gartley) and page number (222) of the first book to describe it (Profits in the Stock Market) way back in 1935. In essence, it helps traders identify higher-probability turning points in the market from the confluence of multiple Fibonacci levels.
In this case, the 100% retracement of XA, 161.8% Fibonacci extension of BC, and ABCD pattern (where the AB leg is the same length as the BC leg) all converge at 1180 (see chart below). When multiple different support levels converge, the probability of a rally from that floor is increased.

This post was published at GoldSilverWorlds on October 10, 2014.

The Fed’s 2% Inflation Target: The Ultimate Keynesian Con Job

The old adage that if something is repeated often enough it is soon assumed to be true couldn’t be more apt with respect to the Fed’s 2% inflation target. Today Bloomberg has a piece that does exactly that, describing how’Federal Reserve officials are hunting for new tactics to raise price increases to their target’ because ‘inflation is descending toward the danger zone’.
In fact, the September meeting notes cited several officials who worried that ‘inflation might persist below’ the committees target for ‘quite some time.’ Accordingly, the Bloomberg author, Craig Torres, pulled out his editorial pen and offered his opinion as if it were objectively obvious:
The Fed needs a clear strategy for getting the inflation rate higher after falling short of its 2 percent target for 28 consecutive months.
Well, now. Twenty-eight straight months of misses. Let’s see, even using the Fed’s systematically understated measure of inflation, the PCE deflator ex-food and energy, consumers’ savings and paychecks have lost 3.3% of their purchasing power during the last 28 months.
Apparently, had they instead suffered a 4.7% loss of purchasing power (2% inflation for 2.33 years) everything would be copasetic. Instead of remaining in a funk, as has been evident since it unexpectedly snowed last winter, they would have been spending up a storm. Presumably the US economy would have long ago hurtled through that pesky ‘escape velocity’ barrier.
Isn’t it amazing that over the relatively brief period in question that shrinking the purchasing power of the dollar by 4.7%% versus 3.3% could make such a profound difference. Or maybe not.
But don’t expect the ‘journalists’ at Bloomberg to even ask. Like their ‘competitors’ at the WSJ and Reuters, they are about as mainstream, lazy and intellectually sloppy as they come. In this case, it is not likely that a writer who cites two ex-central bank true believers as his main source – -former Fed governor and macro-model peddler, Larry Myers, and former Bank of England policy committee member and current Keynesian snake oil salesman, Adam Posner – -would trouble himself with proof that a 2% annual gain on the CPI is a proven economic elixir.
No, the 2% inflation mantra has been repeated so early and often by Fed speakers, their court economists and the Wall Street stock peddlers known as ‘strategists’ that it appears to amount to the monetary equivalent of the Pythagorean theorem. Even then, the literalist presentation of the matter in the attached story sets a new standard for credulity.

This post was published at David Stockmans Contra Corner on October 10, 2014.

Finland Downgraded, Prime Minister Busy Eating his Euro-Crisis Words that AAA-rated Countries Should ‘Dictate the Rules’

It didn’t take all that long. In November 2011, Alexander Stubb, then Finnish Minister for European Affairs and Foreign Trade, added his morsels of wisdom to the Eurozone debt crisis that was blooming into splendid fruition.
‘It should be the triple-A countries’ – at the time Finland, Germany, France, Austria, the Netherlands, and Luxembourg – ‘that basically, not dictate the rules, but at least have a strong say, because why would we listen to countries that are not taking care of their own public finances?’ he told Reuters.
With a PhD in International Relations from the London School of Economics and Political Science, he knew whereof he spoke.
‘For me, the euro is a Darwinist system. It is the survival of the fittest. The markets take care of that, and I think that’s the best way we can keep up market pressure.’
Political pressures and the force of the financial markets would elbow these non-triple-A debt-sinners countries – 11 of them at the time – into cutting their deficits and eventually, someday, their debts, as prescribed by treaty, or they’d force them out of the Eurozone.
Europe’s ‘real core’ is made up of those countries that use the euro and are triple-A rated, he said. They have a better economic management reputation than the rest. So, instead of some political core, ‘it’s a market driven core.’ And those countries that couldn’t make it to a triple-A rating, well, the Eurozone might need to be a lot smaller….
In the summer of 2012, Uncle Draghi’s ‘whatever it takes’ washed over these markets.
In June 2014, Stubb became Prime Minister.
And today, Standard & Poor’s cut Finland’s triple-A rating to AA , same as many other debt sinners in the Eurozone. Only Germany and Luxembourg remain in that triple-A rated core of Europe that Stubb had so wisely described three years ago.

This post was published at Wolf Street on October 10, 2014.

The Wrong Idea About Inflation

Here is a post I made to Facebook yesterday.

I was making two points. One, virtually all commodities are in falling trends now (except certain foods affected by the government-create drought conditions in California). Two, it has nothing to do with the money supply.
Some comments on the thread reminded me most people accept the idea that changes in the money supply lead to changes in prices (though not necessarily evenly or instantaneously). This idea is tempting, convenient, and it seems only ‘common sense’. However, it is facile.
I decided to write this post to add some context. Since 2008, there has been a massive increase in the money supply. M0 has increased from about $875B to $4T. It is now 3.5X what it was. M1 went from $1.4T to $2.8T, or 2X. M2 went from $7.8T to $11.4, or about 1.5X.
Prices haven’t done any such thing. The Bloomberg Commodity Index fell from about 175 to 118 today. In other words, the commodity index is 0.67X what it was.
How do we explain this? I have offered my theory of interest and prices. To condense 12,000 words into a sentence: rising interest rates and rising prices go together.

This post was published at Acting-Man on October 10, 2014.

Harvey Organ’s Gold and Silver Blog Has Been ‘Deleted by Court Order’

Several patrons have asked me if I know what has happened to Harvey Organ’s popular precious metals blog.
I have been given to understand that his site on Google blogger has been ‘deleted by court order’ and in accordance with Google’s terms of service and content policy.
The specific terms of the court order or the originator have not been revealed to me.
I had thought Harvey’s blog was fairly benign, and Google has been fairly easy to work with based on my own experience.
Things like this generally involve either alleged copyright infringement or some sort of defamation. Harvey was based in Canada, and I do not know if Canadian laws on this are different than US laws, or even which jurisdiction issued the court order. I do not care to speculate. This is all that I know. If I find out more, which I hope will be the case, I will pass that along.
You may find some ‘back issues’ of Harvey’s blog on the Internet Archive here.
We’ll always have Paris. Here’s looking at you, kid.

This post was published at Jesses Crossroads Cafe on 10 OCTOBER 2014.

Chinese Gold Imports via Hong Kong vs SGE Withdrawals

As can be seen here the Hong Kong Imports into China are only a fraction of the gold delivered through the SGE.
Currently these Hong Kong statistics are the only released statistics on gold flows into China. Hence one must reason that with the latest reading of only 14.6% a lot of gold must be coming in via other channels.
Local Chinese production of over 400 tonnes per year must also be taken into consideration.

This post was published at Gold Broker on Oct 10, 2014.

The Home ATM Is Back: HELOCs Surge To 2008 Levels

While the memory of a financial market participant can be measured in nanoseconds, it appears that the average American has also become goldfish-like as RealtyTrac reports a total of 797,865 home equity lines of credit were originated nationwide, up 20.6% from a year ago and the highest level since 2008.

As Jim Quinn so eloquently notes, after a two year Wall-Street-engineered fraudulent boost in home prices in the exact markets that led the bubble in 2003 through 2007, the delusional dolts are now acting like the increase in home equity is real:

This post was published at Zero Hedge on 10/10/2014.

Gold Seeker Weekly Wrap-Up: Gold and Silver Gain About 3% on the Week

The Metals:
Gold dropped $5.99 to $1217.71 by a little after 4AM EST before it bounced back to $1224.79 in the next four hours of trade and then edged down to $1219.04 by midmorning in New York, but it then bounced back higher into the close and ended unchanged on the day. Silver slipped to $17.216 before it rebounded to $17.396 and then fell back off, but it also ended at unchanged on the day.
Euro gold rose to about 970, platinum lost $13 to $1258, and copper remained at about $3.03.
Gold and silver equities fell over 2% in the first hour of trade before they rose to see over 1% gains by midday, but they then fell back off again into the close and ended near their morning lows.

This post was published at GoldSeek on 10 October 2014.

The Real Great Rotation: Bond Funds Have Biggest Inflow On Record

Investors worldwide poured a net $15.8 billion into bond funds in the week ended Oct. 8. As Reuters reports, this is the biggest inflows in dollar terms since records began in 2001, according to EPFR Global. Money market funds also saw the biggest inflow since October 2013 as it appears the real great rotation is from stocks (biggest outflows in 9 weeks) into ‘safe’ assets.

This post was published at Zero Hedge on 10/10/2014.

Wow, What A Week!

Crazy stuff! The “deflation bias” charts plunged only to be saved (for less than a day) by some Fed jawboning. And now here we are, at the end of the week, with stocks and other paper “assets” clinging to support.
It has been quite a volatile day so far in the paper markets. Crude plunged as low as $83.62 before rebounding more than $2. The S&P 500 bottomed out near 1913 but has since rallied over 10 points. Fear of deflation/disinflation seemingly has “investors” everywhere poised and ready to run for the exits. Will that mass exodus begin next week? Maybe. It is October, by the way…
That said, with the ever-present bid of the Plunge Protection Team, perhaps the global equity markets will stabilize again? Let’s watch today’s close very closely. Last week, we identified the area around 1926 as important support and a close below there would almost certainly invite a trip down to 1905 early next. Below there, the drop would likely accelerate before reaching new support near 1870. At that point we’d be talking about a 10 % correction and the bubbleheads on CNBS would be uncontrollably hysterical. Could it happen? Absolutely! That’s why next week is setting up to be so interesting.

This post was published at TF Metals Report on October 10, 2014.

The Crash Course – Chapter 17 – Understanding Asset Bubbles

The following video was published by ChrisMartensondotcom on Oct 10, 2014
Why they form & how they pop.
Through the long sweep of history, the bursting of asset bubbles has nearly always been traumatic. Social, political and economic upheavals have a bad habit of following asset bubbles, while wealth destruction is a guaranteed feature.
Bubbles only used to happen once every generation or longer, because it took substantial time for the victims to forget the pain of the damage.
But that’s changed in the new millennium. Less than ten years after the bursting of the dot-com bubble we saw the rise & bursting of the housing bubble. This is simply astounding and thoroughly unprecedented.
More astonishingly, there are now concurrent equity and bond bubbles raging across the entire financial market structure of the world.
We are in our third bubble period in less than 15 years. This new era of serial bubble-blowing signifies that we are now in new turbulent territory with which we have little historical guidance to draw on.
The recent years of money printing by the world’s central banks has NOT ushered in a ‘permanent plateau of prosperity’. And, as with all bubbles, symmetry indicates the downslope after the bursting will be steep, swift, and likely quite scary.

COT Gold, Silver and US Dollar Index Report – October 10, 2014

Gold COT Report – Futures Large Speculators Commercial Total Long Short Spreading Long Short Long Short 174,075 107,628 27,007 143,466 206,873 344,548 341,508 Change from Prior Reporting Period 3,000 1,423 -796 -1,930 748 274 1,375 Traders 122 101 67 52 47 201 190 Small Speculators Long Short Open Interest 35,539 38,579 380,087 -61 -1,162 213 non reportable positions Change from the previous reporting period COT Gold Report – Positions as of Tuesday, October 07, 2014
The COT reports which we look at each week provide a breakdown of each Tuesday’s open interest for markets in which 20 or more traders hold positions equal to or above the reporting levels established by the CFTC. The weekly reports for Futures-and-Options-Combined Commitments of Traders are released every Friday at 3:30 p.m. Eastern time. The short report shows open interest separately by reportable and Non-reportable positions. For reportable positions, additional data is provided for commercial and non-commercial holdings, spreading, changes from the previous report.
Futures and Options Combined
What does this title mean? A future is a standardized contract traded through regulated exchanges where an investor buys or sells a contract at a specified price for a specific date in the future. The price includes the interest charge due to the seller by the buyer from the date of the contract to the due date. An option is the ‘right to buy or sell’ a contract at a fixed date in the future at a specific [strike] price. The difference is that a futures contract is an agreement to buy or sell, whereas an option gives the holder the right to buy or sell. An option holder can decide not to take up that right and will only lose the cost of buying the option. His loss is therefore definable at the start of his investment, while the potential profit has not limit to it. A futures contract is usually leveraged [a loan provided] up to 90% of the contract. However, with the owner liable to top up his ‘margin’ to maintain this 10% his potential losses can rise far higher than his investment. A ‘long’ [buying] contract limits its loss to the full price of the item, whereas the ‘short’ [selling] contract has no limit except the height that the price of the item can rise to.
The Commitment of Traders report [COT] is therefore a report on the overall position of the Commodity Exchange [COMEX or NYMEX].

This post was published at GoldSeek on 10 October 2014.

5 Things To Ponder: Through The Looking Glass

‘If I had a world of my own, everything would be nonsense. Nothing would be what it is, because everything would be what it isn’t. And contrary wise, what is, it wouldn’t be. And what it wouldn’t be, it would. You see?”Lewis Carroll, Alice’s Adventures in Wonderland
Is this the beginning of a bigger correction, or just a respite before the next advance? This is the first correction, since the beginning of the Federal Reserve’s latest round of quantitative easing, where the market has broken decisively through its shorter term moving average as shown below.

As I discussed yesterday, the Federal Reserve is unlikely to raise rates soon. With spreading global weakness due to the recession in Japan, the Eurozone and slowdown in China and U. K the global wave of ‘deflationary’ pressures will likely weigh on domestic growth in coming quarters. Such would prove a disappointment to market bulls.
Wednesday’s performance (S&P 33 pts) raised the question as to whether it was the start of a return to recent highs, or just another counter-trend rally within a still-developing downtrend? Thursday’s collapse through critical moving average support at 1945 puts the current bullish trend in danger.

This post was published at StreetTalkLive on 10 October 2014.

“De-Dollarizing” Russia Pays Down Near-Record $53 Billion In Debt In Third Quarter

Despite the reassuring narrative from The West that Russia faces “costs” and is increasingly “isolated” due to sanctions for its actions in Ukraine, the most recent data suggests reality is quite different. First, capital outflows slowed dramatically in Q3 (from $23.7 billion in Q2 to $13 billion in Q3) with September seeingcapital inflows for the first time since Sept 2013. Second, Russia’s current account surplus was significantly stronger than expected ($11.4 billion vs $8.8 billion expected) driven by increased trade. Third, and perhaps most crucially, Russia paid down a massive $52.8 billion in foreign debt as Putin “de-dollarizes” at near record pace, reducing external debt to the lowest since 2012.
As Goldman explains, Trade and income improved notably…

This post was published at Zero Hedge on 10/10/2014.

A Brief Visual History Of Metals

We have documented the history if individual metals before and we have also visualized their annual production. However, we have not seen all of the metals on one timeline before such as in this infographic.
Worth noting is gold’s prominence ever since the beginning of history. Because the yellow metal is one of the rare elements that can be found in native form (such as nuggets), it was used by the earliest of our ancestors.
Comparatively, it is only recently that the technology has advanced to allow us to discover or extract the rest of the metals on today’s periodic table. For example, even though we knew of titanium as early as 1791, it was relatively useless all the way up until the 1940?s because of its metallurgy. In the 20th century, scientists advanced a way to remove the impurities, making it possible to get the strong and hard titanium we know today.
Another standout fact is that it took all the way until the early 19th century for two very important elements to be discovered. Both are not found free in nature very often and thus slipped detection for many centuries. Silicon, which actually makes up 26% of the earth’s crust, was discovered in 1823. Then in 1827, aluminum was discovered – we now know today that it is the most common metal in the earth’s crust (it’s actually 1200X more abundant than copper).

This post was published at Zero Hedge on 10/10/2014.

Precious Metals Getting a Temporary Reprieve

Gold closed last week below $1200 for the first time but has since rebounded from support at $1180. Silver has also rebounded but only after declining in 11 of the past 12 weeks. Precious Metals endured a very rough September and became very oversold. With Gold near its daily low and the gold miners (HUI, GDX) near their December lows, a rebound was probable. Precious metals bulls need to stay patient and disciplined as we believe this is an oversold bounce in a sharp downtrend until proven otherwise.
We plot Gold and Silver in the weekly candle chart below. First, we should note that triple bottoms (in the bullish sense) are extremely rare. Gold does not have the look of a triple bottom or reverse head and shoulders pattern. Over the past 15 months Gold has continued to make lower highs. The most recent high (this summer) indicated greater weakness as it reversed course before reaching trendline resistance. Meanwhile, note that Silver recently brokedown from what appeared to be a triple bottom. Silver has declined in 11 of the past 12 weeks. It could rebound back to previous support in the mid $18s before resuming its downtrend.

This post was published at GoldSeek By Jordan Roy-Byrne, CMT / Oct 10, 2014.