Gold and Silver Market Morning: Feb 15 2017 – Gold not moving except to adjust to exchange rates!

Gold Today – New York closed at $1,227.40 on the 14th February after closing at $1,225.90 on the 13th February. London openedat $1,226.45 today.
Overall the dollar was stronger against global currencies early today. Before London’s opening:
– The $: was stronger at $1.0572: 1 from $1.0623: 1 onyesterday.
– The Dollar index was stronger at 101.29 from 100.78 onyesterday.
– The Yen was weaker at 114.47:$1 from yesterday’s 113.48 against the dollar.
– The Yuan was weaker at 6.8694: $1, from 6.8681: $1, yesterday.
– The Pound Sterling was weaker at $1.2457: 1 from yesterday’s $1.2529: 1.
Yuan Gold Fix
Shanghai was trading at 273.34 Yuan towards the close today. This equates to $1,238.40, but allowing for the different quality of gold being traded [.9999 fineness] and on today’s exchange rate, to align it with New York and London prices it equates to $1,233.41.
LBMA price setting: The LBMA gold price was set today at$1,225.15 down from yesterday’s $1,229.65.

This post was published at GoldSeek on 15 February 2017.

The Latest Casualty: Trump’s Labor Pick Puzder To Withdraw Nomination

News: Source very close to Labor Secretary nominee Andy Puzder tells me he expects Puzder to withdraw. "He's very tired of the abuse."
— Major Garrett (@MajorCBS) February 15, 2017

Update 2: It’s confirmed:
Update: that didn’t take long. As CBS’ Chief White House reporter Major Garrett reported moments, ago a “source very close to Labor Secretary nominee Andy Puzder tells me he expects Puzder to withdraw. “He’s very tired of the abuse.” And now begins the scramble by Trump to find a replacement.
Following Betsy DeVos’ narrow confirmation, it seems Andrew Puzder may not be so lucky.
The President’s pick for labor secretary faces a Republican revolt as CNN reports a number of top Senate Republicans have urged Trump to withdraw the Carl’s Jr. CEO’s nomination.

This post was published at Zero Hedge on Feb 15, 2017.

TRUMP SENDS GOLD HIGHER | Midweek Metals Report

The following video was published by SilverDoctors on Feb 15, 2017
bouncing from $17.80 back to $18.
The metals sold off Tuesday morning as Fed Chairwoman Janet Yellen informed Congress “waiting too long to hike is unwise”, resulting in the market almost immediately fully pricing in June and December Fed rate hikes. Silver was sent down 30 cents from $18.10 to $17.80, and gold was sent from $1235 down to a low of $1216 this morning.
Trump jerked the markets and metals back higher today however, informing the markets “we’re doing a massive tax plan’ that “will be submitted in not so distant future’ The comments sent the DOW soaring to an all-time high over 20,600, and sent silver back above $18/oz and gold back over $1230.

Dow Hits 20,600 After Trump Hints At “Massive Tax Plan”

Trump did it again: one week after he promised to unveil “phenomenal” tax cuts, moments ago in his meeting with retail CEOs, who are meeting with the president to get him to kill the border adjustment tax idea, he pulled another OPEC, using the precise word the algos were looking for, and this time said that “tax reform is one of the best opportunities to really impact our economy,” Trump said. “So we’re doing a massive tax plan that’s coming along really well.”
He also said that there will be a ‘much, much simpler tax code’ that will lower rates for everybody in every bracket. He added that ‘other than H & R Block, people are going to love it.’
Of course, people would love to know when it is coming, to which Trump had no explicit answer, instead saying the “tax plan will be submitted in not so distant future’

This post was published at Zero Hedge on Feb 15, 2017.

Gold Bull Market? Or was 2016 Just a Gold Bug Mirage?

The consensus view in the precious metals sector is that we have embarked on the next great bull market in gold and silver. The story is gold and the entire mining sector bottomed in early 2016 and launched into its first leg up into early August. The sector then underwent a stiff correction from August to December, and has now finally found its legs and the upward advance has resumed. Money is now flowing into exploration and development plays reflecting the belief in this narrative.
I have an alternative interpretation of the markets action and I would like to share it with you. Intellectual integrity requires me to remain objective and skeptical of the market action since Jan 2016 due to various reasons we will discuss. As an investor I participated in last year’s colossal rally from start to finish, however I am NOT convinced the epic gold bear market which began in 2011 ended in early 2016.
Last year’s rally may have been simply a B wave of an A-B-C correction within the massive bear market that started in 2011. The market uses such moves to relieve internal pressure and to reset psychology. Mr. Market is a deceitful devil and he does not consider us his friend, and uses fakery and tricks to divert us off the trail of success. He employs two diabolical lieutenants to do his dirty work, they are named Mr. Bull and Mr. Bear. Mr. Bear, particularly is a deceitful operator, as he drags market participates down the slope of hope using psychological warfare as his principle tool. Savvy operators who may recognize the trend is still down may attempt to profit by short selling, but Mr. Bear heads them off by squeezing them out of their positions just before the collapse occurs. Mr. Market’s objective is to travel alone to his destination, in so doing he denies you profit in his work. As I said, he is not a nice guy.
If Mr. Market’s ultimate goal is to bring gold and PM stocks to lower levels he needed to pursue different tactics by the fall of 2015. After a 4 year vicious bear market psychology had become universally bearish. Investors were bombed out, there were no more sellers, and for a market to go down it needs sellers. This is where Mr. Market deploys Mr. Bull to reset the psychology of the market. Mr. Bull introduces his tool of the bear market rally (BMR) which draws fresh money back into the market in hope that the bottom is in. Investors acquire a new sense of optimism and lean into the new (false) trend. What this does is refuel the market with new selling power and once the downtrend resumes this new supply powers the market below previous levels. Mr. Bull and Mr. Bear are dutiful soldiers executing Mr. Markets commands achieving his objectives. After a prolonged 4-year bear market, where everyone is universally bearish this process requires more than just a run of the mill BMR, it requires an A-B-C cyclical correction. The question is was the rally of 2016 just the B (up) wave of an A-B-C correction with C ( down) wave to follow.
The Big Picture- the alternative view
Let’s look at this big picture and explore whether the massive bear market which began in Sept 2011 could actually still be ongoing, which is my alternative view. I don’t really know if the bear ended in 2016, but until gold and the mining stock indexes can exceed the August 2016 highs we must consider , as a possibility , that it has not. The bull market from 2001 to 2011 traced out a 5-wave Elliot bull market pattern. Could the rally of last year just be a B wave of an A-B-C correction within the bear market which started in 2011? I am not convinced either way but I am keeping an open mind. The markers we watch are the lows and highs of 2016. When either of these are exceeded, we will then know the answer.

This post was published at GoldSeek on 15 February 2017.

“Something Snapped” – Stocks Decouple As VIX Call Volume Explodes

As one veteran trader noted “something snapped” two days ago as VIX and US equities decoupled notably for the first time since the election. This morning VIX is surging once again (near 12) at the same time as US stocks are soaring.
Most notably, VIX call volume has exploded to its highest since September as chatter of long VIX call liquidations spread across trading desks.
Which seems to be confirmed by the crash in VIX Call protection costs…

This post was published at Zero Hedge on Feb 15, 2017.

Bianco: Trump Will Bring More Inflation Than Real Growth

We’ve seen a divergence between ‘hard’ economic numbers and relatively strong ‘soft’ data including sentiment readings, and the consensus is for an economic reflation under President Trump’s direction.
To parse what this might mean for investors, we spoke with Jim Bianco, president of Bianco Research on FS Insider to get his take on the “reflation trade” underway and how he thinks 2017 will play out for the economy and financial markets.
Data Divergence May Signal Inflation
Though sentiment and other ‘soft’ economic indicators are signaling growth ahead, the hard numbers coming out aren’t as strong, Bianco stated.
‘According to a lot of the sentiment data … consumer confidence is at a 17-year high,’ he noted. ‘Markets have a narrow definition (of positive news). They care about profits and they care about businesses doing better. In that respect, they see a Trump presidency as an unabashed positive.’
However, most of the positive information coming out is in the form of surveys, he added. Here’s a short clip of what he had to say:

This post was published at FinancialSense on 02/14/2017.

Yellen Takes The Stand Before The House Financial Services Committee; Live Feed

Federal Reserve Chairwoman Janet Yellen is likely to face a tougher audience today as she returns to Capitol Hill for a second day of monetary policy testimony, this time before the House Financial Services Committee.
Yesterday the market focused on Yellen’s comments before the Senate Banking Committee that the Fed would likely raise short-term interest rates ‘at our upcoming meetings’ amid an improving economy, a signal that a move could come as soon as the central bank’s next meeting in March…which sent the March rate hike odds soaring.
Yellen declined to say whether a rate increase next month was likely but cautioned that holding off on rate increases for too long ‘would be unwise,’ and could force the Fed eventually to raise rates rapidly, which could trigger a recession.
While Senators yesterday focused primarily on economic and regulatory issues, House members today are likely to question Yellen about many GOP-backed proposals to rein in the central bank, proposals that she has previously opposed. The measures include allowing Congress to audit the Fed’s interest-rate decisions and requiring it to adopt a mathematical rule to guide interest rate decisions.

This post was published at Zero Hedge on Feb 15, 2017.

Another Unique Blow-Off Factor

The world’s foremost silver analyst Theodore Butler has done it again. He has elaborated another bullish factor so powerful it screams at us to buy silver. As you know, Mr. Butler is the supreme expert on futures trading in silver. The reason that this knowledge is so important is because the COMEX is the primary place where silver prices are set. Forget about China, the dollar, the economy or whatever reason the media reports. Billion dollar banks, hedge funds and computerized trading monolith’s set the price on the COMEX.
What Mr. Butler’s brilliant analysis has uncovered is extremely complex, so I’ve had to simplify it so I could understand it myself. Over the years, he has pointed to the technical hedge funds as the big buyers and sellers who move prices up and down. The big banks such as JPMorgan take the other side of these trades. These technical funds usually go long as prices rise and short as prices fall. They trade in and out of their positions based on price movements.
Over the past three years, a new type of hedge fund buyer has emerged. Mr. Butler calls them the core non-technical funds. They don’t trade, they buy and hold. From late 2013 to the summer of 2015 their long position grew to 40,000 futures contracts and more recently to 60,000 contracts. That’s 300 million ounces of silver in this core long position. These are longs who are holding and waiting for higher prices. They use futures as their silver investment vehicle because of the leverage available.
According to Mr. Butler, there are two other types of silver buyers, small traders and the other large reporting traders. Together, he estimates their total long position to be 20,000 contracts. That makes a total of 400 million ounces held on a long term basis when adding up all categories of permanent longs.

This post was published at SilverSeek on February 14th, 2017.

All Eyes on Greece

Prime Minister Alexis Tsipras has completely failed the Greek people. He was elected to exit the EU but instead he has wiped out his country trying to stay in the Eurozone. Pensions have been attacked 11 times since the crisis began in 2010. The very day Greece asked the IMF for help was precisely on the day of our target – Pi from the 2007.15 high. Today, Greece is even worse than the United States during the Great Depression from a social and economic situation.
Greece is such a beautiful country and its people are among the most pleasant in Europe. Yet all because Merkel promised Greece would be made to repay, that promise has torn Europe apart at the core. Her polls crashed as everyone began turning against her citing that Greece forgave the debts that Germany owed it after World War II to help Germany get back on its feet. Merkel REFUSED to listen because that was her promise that Greece would repay. To boost her international image of being a loan shark, she turned within a few weeks and opened the gates to Europe for the refugees to change her personal image. Merkel transform the debt crisis into a refugee crisis and now we have both.

This post was published at Armstrong Economics on Feb 15, 2017.

Consumer Prices Surge At Fastest Pace In 5 Years As Real Wages Tumble

Stagflationary trouble looms.
As prognosticators ohh and aah over the soaring consumer price index (up 2.5% YoY – the most since March 2012), driven by a 14.2% YoY spike in gasoline prices, it appears they missed the fact that real average weekly earnings plunged by 0.6% YoY – the biggest wage collapse since November 2011.
After Germany and China’s inflation-a-palooza, US consumer prices are soaring too.
Some details from the report:
The food index rose 0.1 percent in January, its first increase since April 2016. The index for food away from home rose 0.4 percent, its largest increase since September 2015. The food at home index was unchanged in January after declining in recent months. The index for meats, poultry, fish, and eggs, which had declined for 16 consecutive months, rose 0.7 percent in January as the index for eggs rose 14.3 percent. The index for other food at home also rose in January, increasing 0.2 percent. The energy index rose 4.0 percent in January, its fifth straight increase. The gasoline index continued to rise, increasing 7.8 percent. The index for natural gas also increased, rising 1.5 percent in January. The index for energy increased 10.8 percent over the past year, with all of its major components rising. The gasoline index rose 20.3 percent, and the index for natural gas increased 10.1 percent. The shelter index rose 0.2 percent in January after increasing 0.3 percent in both November and December. The rent index rose 0.3 percent, and the index for owners’ equivalent rent increased 0.2 percent. The apparel index rose in January, increasing 1.4 percent.

This post was published at Zero Hedge on Feb 15, 2017.

An age-old relationship between interest rates and prices

The chart displayed near the end of this discussion is effectively a pictorial representation of what Keynesian economists call a paradox* (‘Gibson’s Paradox’) and Austrian economists call a natural and perfectly understandable relationship.
Gibson’s Paradox was the name given by JM Keynes to the observation that interest rates during the gold standard were highly correlated to wholesale prices but had little correlation to the rate of ‘inflation’, that is, that interest rate movements were connected to the level of prices and not the rate of change in prices. It was viewed as a paradox because most economists couldn’t explain it. According to conventional wisdom, interest rates should have been positively correlated with the rate of ‘price inflation’.
The problem is that most economists did not – and still do not – understand what interest rates are.
First and foremost, interest rates are the price of time. They reflect the fact that, all else being equal, humans place a higher value on getting something now than on getting exactly the same thing at some future time. Interest rates transcend money, because they exist even when money does not. With or without money and all else being equal, getting something now will always be worth more than getting the same thing in the future**. This is called time preference.
Time preference is the root of interest rates and the natural interest rate is a measure of societal time preference. That is, the natural interest rate is a measure of the general urgency to consume in the present or the amount that would have to be paid, on average, to make saving (the postponement of consumption) worthwhile. For example, the average 7-year-old child has a very high time preference, in that if you give the kid a choice between getting a desirable toy today or getting something more in 3 months’ time, the ‘something more’ option won’t be chosen unless it is a LOT more, whereas a middle-aged adult with substantial savings is likely to have low time preference.

This post was published at GoldSeek on 15 February 2017.

January Spending Spree Has US Retail Sales Rising Most In Nearly Five Years

Confirming that the US economy is indeed heating up considerably and the Fed is rapidly falling behind the curve, not only did today’s blistering CPI come in well ahead of expectations, printing at the fastest pace since 2013, with the core CPI coming in at a dangerously “overheated” 2.3%, above both expectations of a 2.1% print, and well above the Fed’s target of 2.0%, but moments ago the Census Dept. released January retail sales data which showed that after a tepid holiday spending season, US consumers started off 2017 with a bang driven perhaps by optimism over Trump’s new administration, as headline retail sales jumped 0.4% in the month, better than the 0.1% expected, after rising an adjusted 1.0% in December (up from 0.6%). Sales have now grown in every month since August last year.
Retail sales excluding autos rose by a blistering 0.8%, double the expected 0.4%, and also double the upward revised 0.4% in December, while the Control Group also rose 0.4%, more than the 0.3% expected, and in line with last month’s 0.4% (the retail sales ‘control group’ excludes food services, automobile dealers, building materials and gasoline stations).
On an Y/Y basis, retail sales surged 5.6%, the biggest annual increase in nearly 5 years, since early 2012.

This post was published at Zero Hedge on Feb 15, 2017.

Silver Futures Market Assistance – Precious Metals Supply and Demand

Silver Is Pushed Up Again
This week, the prices of the metals moved up on Monday. Then the gold price went sideways for the rest of the week, but the silver price jumped on Friday.
Is this the rocket ship to $50? Will Trump’s stimulus plan push up the price of silver? Or just push silver speculators to push up the price, at their own expense, again?
This will again be a brief Report this week, as we are busy working on something new and big. And Keith is on the road, in New York and Miami.
Gold Fundamentals Improve Further
Below, we will show the only true picture of the gold and silver supply and demand fundamentals. But first, the price and ratio charts.
Next, this is a graph of the gold price measured in silver, otherwise known as the gold to silver ratio. It fell this week.
For each metal, we will look at a graph of the basis and co-basis overlaid with the price of the dollar in terms of the respective metal. It will make it easier to provide brief commentary. The dollar will be represented in green, the basis in blue and co-basis in red.

This post was published at Acting-Man on February 15, 2017.

Empire Fed Survey Soars To 30-Month Highs (Despite Slump In ‘Hope’)

Extending the trend of strong soft survey data, Empire Fed Manufacturing surged to its highest since September 2014 in February as Prices Paid led a surge across every sub-component. However, after spiking to its highest since 2011, ‘hope’ tumbled in February – its biggest drop in over a year.
Soft survey data is soaring…
But hope faded in Feb… by the most since Jan 2016

This post was published at Zero Hedge on Feb 15, 2017.

Dollar Extends Longest Winning Streak Since 2012 As March Rate Hike Odds Surge

Following this morning’s soaring inflationary and retail sales data, and following Yellen’s hawkish tone yesterday, March rate-hike odds have soared from below 25% to over 40%. The Dollar Index is extending its recent winning streak on this move – now up 11 days in a row, the longest streak since May 2012.
Rate hike odds are ripping higher as The Fed gets its way of pricing in a March rate hike…
And The Dollar Index continues to rise…

This post was published at Zero Hedge on Feb 15, 2017.

Ted Butler Quote of the Day 02-15-17

In COMEX gold futures, the commercials increased their total net short position by a minuscule 2,300 contracts to 134,100 contracts. Yes, this is the largest total commercial net short position in gold in seven weeks (since Dec 20), but gold has risen by more than $100 since then and the increase in the total commercial short position has amounted to…drum roll…100 measly contracts. The raw data are clear – on December 20 and a hundred dollars lower in price than the current price, the total commercial net short position in gold was 134,000 contracts. Here we are three months later, $100 higher, and with moving average upside penetrations up the wazoo and the commercials have sold only an additional 100 gold contracts? Huh?

I remember writing over the past few months (I can’t remember exactly when), about the possibility that the commercials, having sold too early and too aggressively into gold’s rally last year (and racking up $4 billion in open losses at the price highs), might refrain from selling too aggressively this time around and that would mean gold would jump more sharply in price as a result. I think we may have seen a variation of this possibility in that we are $100 higher in gold and the commercials haven’t sold squat yet; but it has unfolded differently than I expected. The commercials haven’t sold aggressively, to be sure, but the main reason for the lack of commercial selling in gold looks to be due to the lack of managed money buying, which I never anticipated. Same net result, but different nevertheless.

A small excerpt from Ted Butler’s subscription letter on 11 February 2017.

  More precious metals news & information available at
Ed Steer’s Gold & Silver Digest.

The bull market no one believes in

The stock market continues to make new highs, yet none of the signs which accompany a market bubble are evident. Investors are asking, ‘When will the Dow finally correct?’ By ‘correct’ they mean ‘decline.’ However, a market correction doesn’t always entail a decline for the major averages and can sometimes take the form of a lateral consolidation or trading range. That appears to be the case for the 2-month period from December through early February when the Dow and S&P made little headway.
In fact, in January the Dow Jones Industrial Average (DJI) recorded its tightest trading range of only 1.1% in over 100 years. This continues a prolonged sideways pattern in the Dow and other averages since mid-December when the post-election rally reached a plateau. The question everyone was asking was whether this plateau was merely a temporary ‘pause that refreshes’ in an ongoing rally or the end of the rally and the prelude to another market setback. The Dow provided the answer to that with the last week’s breakout above the top of the trading range ceiling. It has rallied each day since, putatively on the hopes generated by President Trump’s forthcoming tax-related announcement.

This post was published at GoldSeek on Tuesday, 14 February 2017.

Global Stocks Hit 21 Month Highs, Futures Point To New Record Ahead Of Inflation Data

The global “risk on” melt-up continues.
After a modestly hawkish Yellen warned that every meeting is live, and refused to take March off the table, sending the dollar and yield higher and the S&P to fresh record highs, world stocks rose hitting a 21-month high on Wednesday with the dollar rising for the 11th straight day, the longest positive streak since July 2015.
Yellen’s comments renewed expectations in some quarters for the Fed to raise rates three times in 2017 rather than twice. The futures market did not share this view amid doubts about the U. S. economy’s ability to sustain three hikes.
Yellen left the possibility of a March move open but at the same time that wasn’t particularly surprising and in any case there was no great guidance on timing of the next hike. As DB’s Jim Reid summarizes In terms of the specifics, Yellen repeated that ‘waiting too long to remove accommodation would be unwise, potentially requiring the FOMC to eventually raise rates rapidly, which could risk disrupting financial markets and pushing the economy into recession’. Yellen also said that ‘incoming data suggest that labor market conditions continue to strengthen and inflation is moving up to 2%, consistent with the Committee’s expectations’. She added that ‘at our upcoming meetings, the Committee will evaluate whether employment and inflation are continuing to evolve in line with these expectations, in which case a further adjustment of the federal funds rate would likely be appropriate’. When quizzed on the Fed’s balance sheet strategy Yellen said that the Fed will provide further guidance ‘in coming months’ but that any shrinkage would be ‘an orderly process’. The Chair also confirmed that it still too early to know what fiscal policies will be put in place under the new Trump administration and that ‘we are not basing our judgements about interest rates on speculation’ about fiscal policy.
“At the margin, you could say that Yellen’s comments were probably tilted slightly toward to the hawkish side given her upbeat comments around the economic outlook,” said Jim Reid, markets strategist at Deutsche Bank.

This post was published at Zero Hedge on Feb 15, 2017.