The following video was published by Paul Sandhu on Sep 1, 2014
Dr. Jim Willie joins me to present some important recent developments that bode ill for the dollar as Germany / France and other former allies and partners of the US are now aligning themselves with Russia / China and the BRICS bloc.
Palladium Breaks Multi-Year High Over $900; Russian SWIFT Payment Ban Proposed By UK
The palladium price made a new 13 year high today and reached $909/oz, its highest since February 2001. Markets fear that the global supply of palladium could be impacted by the threat of further sanctions against Russia.
Palladium in U. S. Dollars – 20 Years (Thomson Reuters) The Russian mining industry has not been the target of sanctions so far, but with the oil sector already affected and the gas sector possibly the target of upcoming sanctions by the EU, markets remain fearful.
Russia is the world’s largest palladium producer accounting for over 40% of global production. This is mainly through Norilsk Nickel, the world’s largest mining company which mines nickel, copper and palladium in the area of Norilsk in Siberia, the world’s most northerly city. Palladium is mined as a by-product of nickel and copper mining.
This post was published at Gold Core on 1 September 2014.
In his weekly market review, Frank Holmes of the USFunds.com nicely summarizes for gold investors this week’s strengths, weaknesses, opportunities and threats in the gold market. Gold closed the week at $1,287.62 up $7.54 per ounce (0.59%). Gold stocks, as measured by the NYSE Arca Gold Miners Index, rose 2.40%. The U. S. Trade-Weighted Dollar Index rose 0.44% for the week.
Gold Market Strengths Gold traders are the most bullish in seven weeks amid the escalating tensions in Ukraine. The flat out invasion by Russia this week reminded investors of how attractive and useful gold is as a haven in uncertain times. Gold, after being down early in the week, closed up roughly 0.7 percent.
As part of the continuing deregulation of the gold market in China, Shanghai has allowed 21 banks to become market makers in interbank gold wholesale market as of the first of next month. The announcement was released this week on the Shanghai Gold Exchange website and signals that gold is still very much an important asset in the world’s most populous country.
This post was published at GoldSilverWorlds on August 30, 2014.
As some of you may recall, I published an article here at TFMR one year ago in August of 2013 titled The Paper Armageddon Portfolio. In this piece I outlined a rationale for investing in certain sectors from a ‘hard assets/tangible value’ perspective that would reflect the TFMR understanding of the ongoing Keynesian process of QE, artificially low interest rates, market manipulation, and dollar devaluation. Within those sectors, I selected multiple stocks from companies I felt would outperform the sector as a whole. The general idea was to come up with a list of companies who were poised to not only survive the current debt creation/paper ponzi economy, but would potentially offer solid returns in the coming paradigm where tangible and productive assets will be worth far more than today’s paper promises. So one year later I thought it would be worthwhile to check back in on this investing thesis to see how these picks and sectors fared and to discuss what we might learn from their performance over the last year.
The article I originally posted is here, but to summarize, I outlined four sectors oriented around hard assets and/or the real-world production of tangible goods. The four I chose were 1. Farmland, 2. Timber and grazing, 3. Energy and commodities, and 4. Railroads (which I surmised would be poised to grow in a high fuel costs/post-Petrodollar environment, and to take market share from the currently dominant but fuel inefficient trucking industry).
Let’s assume that, as I recommended in the article, Turdites looked at this list and spent a few weeks doing their own research and due diligence on these companies, then chose to invest a few weeks later. Here is a breakdown of the 1 year performance of these individual stocks I chose within these sectors in my original list. Each entry shows ticker symbol, price change over the last year, % gain, dividend yield, then what a $10,000 investment in that stock would be worth today, and finally how much dividend one would have been paid:
This post was published at TF Metals Report on August 29, 2014.
Attending costly games is on the margins of the household budget. When the credit card gets maxed out, attending is no longer an option.
Please understand I’m not suggesting professional sports isn’t the greatest thing since sliced bread: I’m simply asking if attending pro sports games has become unaffordable to the average American.
Who cares as long as we can watch the games for free on television, right? That raises another issue: in the next recession, will advertisers still pay billions of dollars for broadcast TV ads on sports channels when ads on mobile devices distributed via Big Data analysis can directly target the (shrinking) populace who still has disposable income to spend?
Before we look at the money side of pro sports, let’s note the glorious shared experience of “our team” winning and hated rivals losing. Sports is one of the few experiences that unites a remarkably diverse populace, and one of the few spheres of life that isn’t politicized to ruination.
We all get to live vicariously through sports, and the stranger cheering beside us is suddenly a “friendly” in a largely hostile world.
This post was published at Of Two Minds on August 29, 2014.
The data wrangler, Nick Laird from Sharelynx, sent these long term technical charts of gold in US dollars with a note saying, “I like the look of it Jess. It’s a deep cyclical indicator and you can see from it’s past performance how it works for gold.” I have to admit that this is one indicator I am not given to using, probably since I rarely was a long term investor in the past, and this is a cyclical tool although certain chart functions will allow you to utilize it on shorter term charts, and probably incorrectly based on Coppock’s intent. It is an indicator that generates only buy signals by attempting to identify market bottoms after serious declines. The indicator must turn negativeinto a trough. That implies that it had previously been positive. And then it must begin an upturn and sustain it. So if I am reading these charts correctly, the last buy signal we have had was in 2001 with a big bottom buy signal forming in 1998-99. See what I mean about longer term? For a trader, that is glacial.
This post was published at Jesses Crossroads Cafe on 29 AUGUST 2014.
The purpose of a taboo is to avoid destruction. Those who do not respect the taboos of a culture endanger the cultural identity.
Therefore, disregarding the taboos produces self-destruction and/or destruction.
Many of you read Jeff Clark’s (of Casey Research) recent piece outlining the reasons why silver prices will likely move higher. It was a great piece from an organization with great reach.
But it missed the unmentionable elephant in the room. Here is a summary in all its bullish glory.
1. Inflation-Adjusted Price Has a Long Way to Go
One hint of silver’s potential is its inflation-adjusted price. I asked John Williams of Shadow Stats to calculate the silver price in June 2014 dollars (July data is not yet available).
Shown below is the silver price adjusted for both the CPI-U, as calculated by the Bureau of Labor Statistics, and the price adjusted using ShadowStats data based on the CPI-U formula from 1980 (the formula has since been adjusted multiple times to keep the inflation number as low as possible).
The $48 peak in April 2011 was less than half the inflation-adjusted price of January 1980, based on the current CPI-U calculation. If we use the 1980 formula to measure inflation, silver would need to top $470 to beat that peak.
This post was published at Silver-Coin-Investor on Aug 28, 2014.
Wall Street banks are getting hit by cyber attacks every single minute of every single day. It is a massive onslaught that is not highly publicized because the bankers do not want to alarm the public. But as you will see below, one big Wall Street bank is spending 250 million dollars a year just by themselves to combat this growing problem. The truth is that our financial system is not nearly as stable as most Americans think that it is. We have become more dependent on technology than ever before, and that comes with a potentially huge downside. An electromagnetic pulse weapon or an incredibly massive cyberattack could conceivably take down part or all of our banking system at any time.
This week, the mainstream news is reporting on an attack on our major banks that was so massive that the FBI and the Secret Service have decided to get involved. The following is how Forbes described what is going on…
The FBI and the Secret Service are investigating a huge wave of cyber attacks on Wall Street banks, reportedly including JP Morgan Chase, that took place in recent weeks.
The attacks may have involved the theft of multiple gigabytes of sensitive data, according to reports. Joshua Campbell, supervisory special agent at the FBI, tells Forbes: ‘We are working with the United States Secret Service to determine the scope of recently reported cyber attacks against several American financial institutions.’
This post was published at The Economic Collapse Blog on August 28th, 2014.
Just a short set of comments this evening. They deal with the usual, “The world is going to move away from the Dollar any day now” chatter. If it is, it sure isn’t showing up in the Foreign Central Bank holdings of Treasuries that are in custody at the New York Federal Reserve. Here is the chart.
Look folks, I am just as concerned about the US Dollar as the next guy but when I look at the competition, I see one set of assorted problems or another. What that means is that the idea that the world is going to drop the Dollar and move to some sort of as of yet undefined currency in which to conduct the bulk of its trade simply does not carry much weight with me at this time.
This post was published at Trader Dan Norcini on Thursday, August 28, 2014.
Via email Steen says …
US 10 Year cheapest in G-7! This is one of the reasons for my change to US fixed income and short US Dollar.
US 10 Year spread vs. G-7 equivalent now at 79 bps – close to all time high. As the chart indicates there is considerable mean-reversion in this data series.
The market is long, very long the US dollar into ECB and FOMC meetings where consensus quietly is looking for 10 bps cut by the ECB, maybe even announcement of “private” ABS [Asset Backed Securities]. In the US the regional banks want the discount rate normalized, but reality is close by.
This post was published at Global Economic Analysis on August 27, 2014.
Karl Marx once said, ‘Hegel remarked somewhere that all great, world-historical facts and personages occur, as it were, twice. He forgot to add: the first time as tragedy, the second as farce!’
Georg Hegel was a German idealist and philosopher and although I do not accept Marxist ideals I recognize the truth of his statement in the reality of our world today. Will it be another war followed by depression or a depression followed by a war, another Christian Crusade to insure our public safety and solve the unemployment problem? The populace, who must be distracted, will once again be called upon to fight a war, economic in nature, brought on by greed of a few who lack principles, integrity, honesty and competence. It will be a farce!
Our dollar states, ‘In God We Trust’ yet today our government hardly espouses this belief in their actions or behavior and therefore, why should you? I am not saying to not trust in God, what I am saying is DO NOT trust in the dollar of the United States of America Corporation as a unit of wealth to store the fruits of your labor in. The dollar is but a tool of exchange to pay for goods and services of value. Tomorrow, maybe not so!
The money you have in ASSETS in your bank account is your banks liabilities which they in turn loan out. Today all asset accounts are but virtual numbers on your computer screen or paper account summary at your bank or investment firm. Actually, an imaginary digit is our monetary unit today. These cyber accounts can in essence be deleted or partially deleted at the will of our banking authorities per their FDIC regulation or publicized cyber attack.
This post was published at Gold-Eagle on August 27, 2014.
The IMF’s latest international gold reserves data, updated yesterday, shows that in July, Russia raised its official gold reserves to 5.5 million ounces (1,104 tonnes).
This confirms data released last week by the Central bank of the Russian Federation, which reported an increase of over 300,000 ounces from June’s 5.197 million ounces figure. IMF data is reported with a one month lag.
The latest IMF data also shows that in July, the National Bank of Kazakhstan added 45,000 ounces to its official gold reserves, taking its total holding to 5.1 million ounces.
According to the World Gold Council, over the last six months, Russia has now increased its gold reserves by 54 tonnes. In the same period Kazakhstan has purchased 12 tonnes.
Russia now has the world’s 6th largest gold reserves, officially higher than both Switzerland’s 1,040 tonnes and China’s 1054.1 tonnes. As a comparison, in the second quarter of 2009, Russia only had 550 tonnes of gold in its official reserves meaning that their reserves have nearly doubled in just over 5 years.
The ongoing accumulation of official gold by Russia appears to be part of a reserve diversification strategy. Gold is held by central banks as one of their reserve assets alongside foreign exchange assets including US Dollars and Euros, and also IMF Special Drawing Rights (SDRs).
Some Russian analysts point to the threat of continued western sanctions on Russia as a renewed catalyst for the Russian central bank diversifying out of dollars and euros by increasing its gold reserves. Gold now accounts for over 12% of Russian official reserves and could reach 15% by year end if the current trend continues.
This post was published at Gold Core on 26 August 2014.
You’ve barely heard from me in The Dollar Vigilante (TDV) Blog for the last few years in terms of my picks for gold and silver stocks. If you aren’t a TDV newsletter subscriber, where I comment nearly weekly on the markets and on precious metals stocks you’d think I’d all but disappeared.
However, Jeff Berwick and I have been on the same page that the market wasn’t ready for a heavy focus the last few years, and I’ve been helping our subscribers maintain and manage their portfolios and develop their broader macro-economic outlooks (which included a bullish call on stocks up until the end of 2013 that was not popular with most subscribers). Meanwhile, Jeff has done a great job in focusing on other areas that have had massive growth including bitcoin (up from $7 to $500 since he began talking about it in 2011) and now medical marijuana stocks, one of which, Organigram, just delivered a double since it was brought to TDV and TDV Golden Trader subscribers just a few weeks ago and went public yesterday at more than double the price our subscribers got into it at.
But, as Jeff has recently stated, we believe now is the time to buy gold and silver shares, if for no other reason because they’ve been abandoned by even the value investor. In the TDV portfolio, we have about 18 companies, and we are working towards rounding it out at 20 names.
Two of them have disappeared in takeovers in recent months: Osisko Mining and Papillon Resources.
The buyers are companies that are already included in our portfolio (i.e. Agnico Eagle, Yamana, and B2Gold) so we have not lost the assets altogether. But it gave investors a bit of liquidity and nice gains for those who bought along with us, as we suggested, and it left room for us to bring in a couple of new picks. I will be telling you about them soon (of course subscribers will get first access – you can subscribe here). Importantly, the timing is good. What we see now is that most gold/silver shares have been bottoming for over a year. Some have been rallying through the year, like Agnico Eagle.
This post was published at Dollar Vigilante on August 26th, 2014.
It is unclear exactly why stock futures, bonds – with European peripheral yields hitting new record lows for the second day in a row – gold, oil and pretty much everything else is up this morning but it is safe to say the central banks are behind it, as is the “de-escalation” algo as a meeting between Russia and Ukraine begins today in Belarus’ capital Minsk. Belarusian and Kazakhstani leaders will also be at the summit. Hopes of a significant progress on the peace talks were dampened following Merkel’s visit to Kiev over the weekend. The German Chancellor said that a big breakthrough is unlikely at today’s meeting. Russian FM Lavrov said that the discussion will focus on economic ties, the humanitarian crisis and prospects for a political resolution. On that note Lavrov also told reporters yesterday that Russia hopes to send a second humanitarian aid convoy to Ukraine this week. What he didn’t say is that he would also send a cohort of Russian troops which supposedly were captured by overnight by the Ukraine army (more shortly).
Asian equity markets haven’t really followed suit the US/European rally with bourses in Japan, Hong Kong, and China down 0.6%, 0.4% and 1%. The Dollar is softer against the Yen which perhaps added some pressure on Japanese equities. There isn’t much Asian headlines this morning and we suspect parts of the market (HK/China) are still busy with the ongoing earnings season. Asian credits are doing better in relative terms led by sovereigns. Indonesia’s USD bonds continued its march higher (helped by Treasuries) whilst its 5yr CDS spreads are marked 4bps tighter overnight. Asian stocks fall with the Kospi outperforming and the Shanghai Composite underperforming. MSCI Asia Pacific down 0.2% to 148.4. Nikkei 225 down 0.6%, Hang Seng down 0.4%, Kospi up 0.3%, Shanghai Composite down 1%, ASX up 0%, Sensex up 0%. 2 out of 10 sectors rise with health care, energy outperforming and utilities, telcos underperforming
This post was published at Zero Hedge on 08/26/2014.
Adeptly managed by the central bank and the government, the Argentine peso has been plunging in perfect form, an activity it is very, very good at. And so on Thursday, it plunged 4.1% on the black market, hitting 14 ARS/USD for the first time. With the official rate at 8.39 ARS/USD, the gap between the two soared to a record of 5.61 pesos. A sign that any remaining trace-amounts of confidence in the peso were evaporating.
It was the steepest plunge since January 24, when the central bank devalued the peso by 15%.
‘Expect the government to take action to bring this rate down – fast,’ wrote Bianca Fernet, stilettos-on-the-ground American economist in Buenos Aires and contributor to Wolf Street. This ‘Argentine monetary policy,’ as she explained in The Bubble, would include:
Forcing state-owned agencies to sell dollar bonds locally Closing the cambios and other currency dealers for a few days Raising interbank lending rates, forcing banks to sell assets locally. On Friday, the peso recovered a smidgen, and the reported ‘blue dollar’ rate dipped below 14 ARS/USD, after the central bank had reportedly blown $10 million of its foreign exchange reserves to prop it up. But it desperately needs those reserves – now below $29 billion – to service its foreign-currency debt, part of which it defaulted on once again on July 31.
‘They are reporting a lower rate than the real rate; reporting a rate above 14 is evidently not permitted,’ Bianca told me, perhaps tongue in cheek because that’s the only way to take Argentina. Then she added, ‘The brokers are trading at 14.35 right now.’
On Monday, brokers were selling the dollar at 14.1 ARS/USD, illegal and un-permitted as that may be.
This post was published at Wolf Street on August 25, 2014
Yesterday it was China slamming America’s superpower status (and thus dollar reserve currency status) when in Sina News it stated the following:
Their various reconnaissance aircraft have been wandering around foreign airspace for decades and watching the military secrets of other countries like a disgusting thief spying over his neighbor’s fence. However, when the neighbor comes back with a big stick, the thief will turn tail and run away, blaming the neighbor. When you show people weakness, they will bully you. When you show people strength, they will respect you.
We [the newspaper] believe the Chinese Air Force and Naval aviation should maintain a high level of vigilence and morale in southeast coastal region to prevent the further US action.
America has lost face and does not want to show the world they are sick. They have been lording over other countries for so long, and they will never let it go after they eat this loss.
This post was published at Zero Hedge on 08/24/2014
The currency wars being waged among the world’s nations at this time are going to continue for quite some time, according to Jim Rickards, author of Currency Wars. In this DJ FX Trader podcast posted at the Wall Street Journal, Rickards explains how nations around the world will likely continue their currency devaluations in order to gain an edge in their international trading.
After all is said and done, this is basically what’s been happening in Europe, where countries like Spain, Greece, Ireland, Portugal, Italy and Cyprus depend on each other and the stronger members of the European Union to keep buying their bonds, burying them ever deeper in debt (to each other).
But it’s not limited to just Europe, of course. The US is in just as bad of shape as far as debt is concerned. In all western nations, as the cartoon above adequately portrays, there seems to be a symbiotic relationship between the banks and the countries in debt. The banks enable the governments to keep borrowing just to be able to buy more debt from other countries’ governments, which are doing the exact same thing. The whole sovereign bond market is one giant Ponzi scheme, just waiting to capsize.
There’s been much discussion on the Fed’s newest monetary easing policy. The markets received their much anticipated stimulus and are reacting positively (for now). But as previous posts have indicated, the Fed’s stated objectives and motives are questionable at best. For a few steps further down the rabbit hole, here’s a must-see video from CrisisHQ.
“If you want to understand what’s happening in the Mideast, particularly in Libya, Syria and Iran, you must first understand the main driving force behind U.S. foreign policy. Contrary to mainstream media propaganda, it is not our desire to spread democracy or to prevent tyrannical despots from murdering their own citizens. The real agenda is to protect the Petrodollar system, because it is the only thing that is currently preventing the total collapse of our fiat currency.”
For more information on the Petro-Dollar, please see our research article: Root Cause: The Petro Dollar.