Stocks and Precious Metals Charts – One Step Enough

Just another day in the oligarchy.
There was an intraday note about the returns of stocks and precious metals year to date posted here.
Matt Taibbi had a nice article today titled Putin Derangement Syndrome Arrives.
And on the other hand here is a video with Jimmy Dore and Josh Fox about the breathtaking decline and servile desperation for corporate money of MSNBC here and here.
Well, hysteria is to be expected when the privileged in politics and the media feel as though their privileges are at risk.

This post was published at Jesses Crossroads Cafe on 03 APRIL 2017.

Grantham Commits The Cardinal Sin

Way back in the 4th quarter of 2015, GMO’s Jeremy Grantham wrote a piece titled ‘Part II: 2015 and 2016, U. S. Equity Bubble Update, and Yet More on Oil.’
It is easy to forget, but at that point, the S&P was trading around 2,000 and everyone was bearish. QE had ended, the Fed was fumbling with their first hike and ‘fully valued’ were the buzz words used to describe US equities.
Yet Jeremy didn’t write the all-too-easy piece about how stocks were about to crash. Instead, he acknowledged that equities were expensive, but not yet in bubble territory.
‘On the evaluation front, the market is not quite expensive enough to deserve the bubble title. We at GMO have defined a bubble as a 2-standard deviation event (2-sigma). We believe that all great investment bubbles reached that level and market events that fell short of 2-sigma, did not feel like the real thing.’ ‘… I must admit to feeling nervous for this year’s equity outlook in the U. S. But I am not entirely convinced. Sure, we can have a regular bear market. That is always the case. But the BIG ONE? I doubt it.’
So while most everyone else was predicting a U. S. stock market bear market, Grantham postulated the most likely course for equities was to become even more expensive.

This post was published at Zero Hedge on Apr 3, 2017.

Jim Rickards: Debt, The Death of Money and Gold

Jim Rickards joined Greg Hunter of USAWatchdog to discuss his book The Death of Money and the debt ceiling issues facing Trump and Congress. During the interview the two discuss everything from what to expect from Federal Reserve policy to gold prices in the coming months and years.
To start out the interview Jim Rickards was asked on the national debt where he contends, ‘The debt ceiling is very important. The United States runs budget deficits year after year. In the last 50 years we have only had minimal surplus years under Nixon and Clinton. We currently have $20 trillion of debt. The Treasury cannot just borrow however much they want. The U. S Congress limits the Department of the Treasury’s ability to borrow, what is called the debt ceiling. When the Treasury wants to borrow more, you have to raise the ceiling ceiling by the legislative process – an act of Congress.’
‘Officially the existing debt ceiling ran out on March 15 and the Treasury cannot borrow any more money. Right now the Treasury is within tax season so it has positive cash flow. They have more in than going out and will not need to borrow at the exact moment. That is strictly temporary and a function of tax season in. Once we get through April, the shoe is on the other foot.’
‘They’re going to hit a ‘hard ceiling’ probably by August, if not sooner. Then the issue becomes whether Congress gives the Treasury the authority to borrow more money. The problem is when passing a debt ceiling bill, the ‘strings attached’ deals that come with them. You gain some members in doing deals and lose others. We saw that with the health fiasco and the repeal of Obamacare failed not because of Democrats but because of Republicans who could not agree amongst themselves.’

This post was published at Wall Street Examiner on April 3, 2017.

Why Are Stocks Unhappy: RBC Looks Below The Surface Of Today’s Selling

After a stellar quarter for US equities, stocks have unexpectedly slumped on the first day of Q2 despite “whispers” of pent upmutual fund reallocation into risk assets that would take place today.
So why are stocks lower, besides “more sellers than buyers” and “money going back to the sidelines” of course? For a comprehensive assessment of what is going on below the surface, here is RBC’s Charlie McElligott (who as a reminder warned on Friday about the Double Whammy in the April Effect) looking today’s rates reversal, the shift to “anti-beta” leadership and the “momentum factor” reversal, all of which explain the bad start to the second quarter.
RATES REVERSAL, ‘ANTI-BETA’ LEADERSHIP AND ‘MOMENTUM FACTOR’ REVERSAL WITHIN EQUITIES NOT GOOD START TO Q2
Summary
Kind of the start to Q2 that I was exactly highlighting in Friday’s note, i.e. rates reversing fueled by softening ‘soft’ data vs ‘prices paid’ overshoot, helping to ‘kick off’ a reversal within equities ‘momentum’ longs as ‘growth’ names fading,’defensives’ lead and ‘reflation’ is again hammered. Early focus on the big ‘Prices Paid’ beat in today’s ISM (highest absolute # since ’11), with S&P futures at lows on the session following the release indicating ‘bad inflation’ concerns when weighed against signs of ‘slowing growth’ (Street Q1 GDP downgrades, Atlanta Fed GDPNow downticking, Markit comments on Q2 post Manu PMI release) and weakening ‘soft data.’ This harkens back to the post Dec Fed concerns around ‘stagflation’ potentials and / or ‘hiking faster than we’re growing’ fears…i.e. Fed ‘policy error.’

This post was published at Zero Hedge on Apr 3, 2017.

Trump Admin Cracks Down On Visas For Coders

As Nasdaq reaches ever record-er, record highs, it seems the ability to create a “Hello World” app is no longer enough to warrant an H1-B visa according to new guidelines from the Trump administration.
As The Hill reports, the new policy guidance that would make it harder for companies to use the H-1B visa program to bring foreign computer programmers into the U. S. A policy memo from the U. S. Citizenship and Immigration Services changes the way the agency will process visa applications for computer programming positions, making companies jump through extra hoops to fill those jobs with foreign workers…
The memorandum also does not properly explain or distinguish an entry-level position from one that is, for example, more senior, complex, specialized, or unique.
Furthermore, the memorandum also did not accurately portray essential information from the Handbook that recognized that some computer programmers qualify for these jobs with only ‘2-year degrees.’ While the memorandum did mention beneficiaries with ‘2-year’ degrees, it incorrectly described them as ‘strictly involving the entering or review of code for an employer whose business is not computer related.’

This post was published at Zero Hedge on Apr 3, 2017.

APRIL 3/OPEN INTEREST IN SILVER RISES AGAIN TO 216,000 PLUS CONTRACTS AND WE ARE ONLY 7,000 CONTRACTS AWAY FROM RECORD TERRITORY/ HUGE DEPOSIT OF 4.45 TONNES OF GOLD INTO THE GLD/GOLD UP $3.50 BU…

Gold: $1250.80 UP $3.50
Silver: $18.19 DOWN 4 cents
Closing access prices:
Gold $1254.00
silver: $18.24!!!
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
SHANGHAI GOLD FIX: FIRST FIX 10 15 PM EST (2:15 SHANGHAI LOCAL TIME)
SECOND FIX: 2:15 AM EST (6:15 SHANGHAI LOCAL TIME)
SHANGHAI FIRST GOLD FIX: 1255.73 DOLLARS PER OZ
NY PRICE OF GOLD AT EXACT SAME TIME: 1247.55
PREMIUM FIRST FIX: $8.18
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
SECOND SHANGHAI GOLD FIX: 1255.14
NY GOLD PRICE AT THE EXACT SAME TIME: 1246.25
Premium of Shanghai 2nd fix/NY:$8.89
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
LONDON FIRST GOLD FIX: 5:30 am est 1246.88
NY PRICING AT THE EXACT SAME TIME: 1247.15
LONDON SECOND GOLD FIX 10 AM: 1247.25
NY PRICING AT THE EXACT SAME TIME. 1247.70
For comex gold:
APRIL/
NOTICES FILINGS TODAY FOR APRIL CONTRACT MONTH: 57 NOTICE(S) FOR 5700 OZ. TOTAL NOTICES SO FAR: 221 FOR 22,100 OZ (0.6874 TONNES)
For silver:
For silver: APRIL
0 NOTICES FILED TODAY FOR nil OZ/
Total number of notices filed so far this month: 271 for 1,355,000 oz
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
FEDERAL RESERVE BANK OF NEW YORK EARMARKED GOLD MOVEMENT:
The FRBNY just released its March report on Gold movement at the FRBNY:
In February’s report: 7841 billion dollars worth of gold was in inventory valued at $42.22 per oz
In the March report: 78.41 billion dollars worth of gold was in inventory valued at $42.22 per oz
No of gold oz moved: zero

This post was published at Harvey Organ Blog on April 3, 2017.

Venezuela’s Money Supply Soars By A Record 200%

Two weeks ago, Reuters reported that due to “unexplained” reasons, the Venezuela central bank had stopped publishing its M2, or money supply, data. The M2 money supply was up by nearly 180% in mid-February from a year earlier, according to the central bank before it halted the release of the weekly data without explanation in February.
“If they are not publishing, you know it must be skyrocketing,” Aurelio Concheso, director of the Caracas-based business consultancy Aspen Consulting, stated the obvious. The central bank and ministry of communications did not respond to a request for comment, Reuters adds.
Fast forward to today when following the international outcry over last Wednesday’s failed coup-attempt by Maduro, in which the Supreme Court first withdrew the power of Venezuela’s opposition-controlled Congress, and then promptly reversed itself following loud international outcry and after it appeared that Maduro’s precarious grip on Venezuela society was about to be lost, when Venezuela’s M2 has once again mysteriously reappeared. According to the latest data, the money supply in the crisis-stricken country has surged over 200% in a year, up from 180% as of February, and the fastest rise since records began in 1940, putting it on track for the world’s highest inflation.

This post was published at Zero Hedge on Apr 3, 2017.

The Fed’s Emerging Balance Sheet Plan

Now that the Fed has tinkered the Fed Funds target range to the upside on a handful of occasions over the last year, they are slowly turning more focus to the Fed’s balance sheet. Before the financial crises, the balance sheet stood below $1 trillion. Now, just 8 years later, it sits above $4.5 trillion. That’s a lot of purchased assets and interest rate manipulations. Since they are claiming to have saved the global economy, it is time to prove it by unwinding all these positions.
Their emerging plan is to complete two more rate hikes this year and then address the balance sheet, likely starting by slowing or halting the reinvestment of their proceeds from their current assets. Of course, they don’t want to go too fast, lest the markets panic. The Wall Street Journal observes:
How it proceeds is of great importance to market participants. In 2013, when the Fed signaled it would stop adding to the portfolio, stocks fell, interest rates rose and emerging stock and bond markets sank – an event known as a ‘taper tantrum’ on Wall Street, driven by investor worries about the implications of a less accommodative Fed.

This post was published at Ludwig von Mises Institute on April 3, 2017.

Gold and Silver Market Morning: April 3 2017 – Gold consolidating at resistance/support!

Gold Today – New York closed at $$1,247.30 Friday. London openedat $1,246.20 today.
Overall the dollar was stronger against global currencies early today. Before London’s opening:
– The $: was at $1.0670: 1.
– The Dollar index was at 100.48.
– The Yen was at 111.34:$1 against the dollar.
– The Yuan was at 6.8836: $1.
– The Pound Sterling was at $1.2508: 1.
Yuan Gold Fix
We have been away from the desk since last Tuesday. Today the Shanghai Gold Exchange is closed and will be closed until Wednesday for ‘Tomb Sweeping Day’ when graves [and ancestor’s bones?] are cleaned. This happens once a year. Hence there are no prices to report. More importantly, gold prices today will not see any Chinese demand. As a result today’s prices will not reflect global demand, only London and New York. While the chances of a fall in the gold price globally is higher for today and tomorrow, Wednesday should see Chinese demand return, if that happens.
LBMA price setting: The LBMA gold price was set today at $1,246.25 from Friday’s $1,241.70.
The gold price in the euro was set at 1,169.42.
Ahead of the opening of New York the gold price was trading at $1,246.25 and in the euro at 1,169.42. At the same time, the silver price was trading at $18.17.
Silver Today – Silver closed at $18.21 at New York’s close Friday.

This post was published at GoldSeek on 3 April 2017.

Official Numbers Hide Sagging Prices in Miami’s Epic Condo Glut

Granular data shoes why numbers on the surface don’t add up.
Condo sales in Miami-Dade County have plunged. Condos on the market have surged. Supply has hit 14 months. Developers are sitting on completed units they can’t sell, and months’ supply in their projects has reached several years.
With this kind of supply-and-demand imbalance – sales down 25% from February 2014, inventory up 90% since early 2013 – you’d expect prices to head south. But the median price of condos in February, according to the Miami Association of Realtors, increased 6.3% year-over-year. This is the mystery we’ll shed some light on (chart by StatFunding):

This post was published at Wolf Street on Apr 3, 2017.

Mexico’s Positive Impact on the US Trade Balance

While some countries still enact mercantilist policies that directly affect the relative prices of traded goods in ways that David Ricardo would have understood two hundred years ago, in today’s global trading environment, persistent trade surpluses are usually caused by distortions in income distribution that force up savings rates. These high savings rates, which are almost always mistakenly attributed to a country’s thrifty habits – just as low US savings rate are foolishly attributed to spendthrift American habits – create demand deficiencies that must be resolved with trade surpluses.
For most of modern history, however, it wasn’t this way. Trade imbalances reflected mainly the relative costs of producing goods. If British textile manufacturers could produce and ship textiles to France at a much lower cost than French producers could manage, for example, England would run a trade surplus in textiles with France, and bankers would finance the trade imbalances. During this time, 90 percent of all international financial transactions in London consisted of trade finance. A country’s trade balance consisted of the sum of all its various bilateral trade imbalances, and net flows of capital were primarily driven by trade finance.

This post was published at FinancialSense on 04/03/2017.

The Auto Industry Is About To Drive Off A Cliff, Again

Submitted by Gordon T. Long of MATASII
SELF INFLICTED ABUSE
In the fall of 2015 we released a video study entitled: “The Coming Global Auto Abyss – Too Much Supply, Too Many Brands; Combine with Too Much Credit!”. We concluded that low interest rate monetary policy for the auto industry was like handing crack cocaine to a drug addict. The auto industry would rapidly and irresponsibly abuse it, to such an extent that it would once again ‘spin out’ and careen back to what can only be termed the Washington ‘substance abuse center’. Whether mis-management or clever strategy we are unfortunately being proven right and are now witnessing the reality.

The Washington Keynesian planners mistakenly believe that cheap money still stimulates demand. It historically did this before it became a legally addicting substance, but even its original tenet was essentially based on bringing demand forward. By design this creates a demand hole in the future, but as Keynes himself famously rationalized: “in the long term we are all dead” … so not to worry when the economic need is urgent! Setting aside for a moment this critical structural reality, we need to remember that cheap credit additionally fosters structural ramifications seldom elucidated

This post was published at Zero Hedge on Apr 3, 2017.

The Balance of Gold and Silver – Precious Metals Supply and Demand

Orders of Preference
Last week, we discussed the growing stress in the credit markets. We noted this is a reason to buy gold, and likely the reason why gold buying has ticked up since just before Christmas.
Many people live in countries where another paper scrip is declared to be money – to picture the absurdity, just imagine a king declaring that the tide must roll back and not get his feet wet when his throne is placed on the beach – not real money like the US dollar.
Holding back the tides is serious business… apart from his odd obsession with the waves, King Cnut the Great, son of Sweyn Forkbeard, King of all England and Denmark and the Norwegians and of some of the Swedes, is reportedly known to historians as the most effective Danish King England ever had [PT] It should be obvious, but we have seen much disinformation out there promoting the idea that the dollar is collapsing. Most of the time, most of these people buy dollars as the escape hatch from their native currencies.
They buy the dollar first, and gold (for now) is a distant second.

This post was published at Acting-Man on April 3, 2017.