Gold slips on dollar strength, rises in euros

Gold has slipped overnight as investors weighed the impact of the European Central Bank’s more accommodative policy stance, while palladium posted its steepest gain in nearly three months on escalating tensions between Russia and Ukraine.
Gold prices spent the day meandering between slight gains and losses as investors weighed the ECB’s surprise decision to cut interest rates in addition to announcing two bond purchasing programs. The more aggressive policy move reflects that officials have grown increasingly concerned over the recent period of very low inflation and the threat it holds to the region’s economic recovery.
But for gold, the ECB’s easing efforts are widely seen as a mixed blessing. While gold can benefit from greater investment demand as traders often seek hard assets as a hedge against excessive monetary stimulus, the policy shift can also weaken the euro and strengthen the dollar, making gold more expensive for buyers who use other currencies.

This post was published at TruthinGold on September 5, 2014.

US Dollar and Yen Update…

Tonight is a good time to look at some long term charts for the US Dollar and the Japanese Yen. I’ve been waiting for this day for more than a year now when I first created this long term US dollar chart. Some of our long term members will recall this monthly fractal chart that I labeled as having a Big Base #1 and Big Base #2 which are fractals as shown by the numbers on each base. At the time I thought we were ready to breakout above the almost 14 year S&R rail but as you can see the US dollar needed one more small move lower to finish off the big base #2. The breakout doesn’t look very impressive on this bar chart but it is happening.

This post was published at GoldSeek on 5 September 2014.

Market Report: Short-sellers driving prices

Gold and silver had a bad week, with gold falling $25 to a low of $1262 by the Comex close yesterday, and silver by $0.50. This morning UK-time prices opened a little better on overnight physical demand, no doubt stimulated by those lower prices. The background to this poor performance was dollar strength relative to weak currencies, with the yen, euro and pound all declining sharply. It feels like the market is drained of all positive sentiment, which is reflected in the very low level of open interest in the futures market. These conditions are more consistent with a market that is bottoming out than one that is about to fall sharply. Meanwhile retail demand seems to be stabilising, with growing interest for coins in the west, and weekly physical deliveries in Shanghai have quietly doubled over the last two months. Demand for physical gold has the stealthy effect of increasing the gearing of the shorts in the paper markets.
However, it looks like the short sellers have returned in some force, with good Comex volume last Tuesday and healthy turnover again yesterday (Thursday). Open interest in gold rose, which with a falling price confirms futures are being driven by an increase in short positions, most probably in the managed money category. This is shown in the chart below, and is particularly noticeable since 27th August, the start of the current decline.

This post was published at GoldMoney on 05 September 2014.

Hugo Salinas Price: How the Dollar Will Die

The existence of fiat currencies depends on their ability to acquire dollars. In the case of the fiat dollar, the dollar will continue to exist as long as dollars can be used to acquire gold.
The condition under which no quantity of dollars can acquire a gram of gold, is known as “permanent backwardation”. (There will always be individuals who will be disposed to part with a small quantity of gold, in exchange for dollars or other fiat currencies. But the purchase of gold in quantity can only be done on world markets, and while “backwardation” is temporary. This possibility disappears when “backwardation” becomes permanent).
In “backwardation” – which has presented itself momentarily, in recent times – gold goes into hiding (its owners do not wish to part with it) and in the markets there has been no one willing to purchase gold for future delivery, even though its future price is lower than the price of physical gold for immediate delivery. So far, this condition has been temporary and not permanent.

This post was published at Plata.com.mx

How the Dollar’s Reserve Status Hurts America

“The dollar is the world's reserve currency,” is a statement as American as apple pie. But in a new op-ed for the New York Times, Jared Bernstein, a former economic adviser to Vice President Joe Biden, says that has got to change.
“The problems that having the dollar as the primary reserve currency are causing in our economy and have been causing for years, I think, are deeply under appreciated,” said Bernstein, now senior fellow at the Center on Budget and Policy Priorities. “They include a large and persistent trade deficit, so we’re exporting millions of good jobs overseas… We’ve ended up with asset bubbles, and a marked budget deficit, high unemployment.”

This post was published at Yahoo

Gold Stocks And The Price Of Gold

It’s one of those enigmatic moments in history. As economic conditions worsen, and so do socioeconomic conditions in turn, the performance and returns from stabler forms of capital (and the wealth of those who possess them) improve.
Those who have used foresight to get out of collapsing fiat currencies (the minority) will face some frustration from those who did not avoid the inevitable bust of conventional forms of wealth.
Early Indicators
Before dealing with the social reality of what is happening, we should be very clear about reading the winds correctly, of course. What is happening? And why?
Let’s take the question of gold prices in relation to the prices of stocks like mining companies. There could be (and there is) earlier activity and stimulation in the gold stocks well before visible signs of revaluation of gold per se.
We know what is happening by both contemporary markers as well as by historical wisdom. True, these are unprecedented times, in which technological wild cards abound, yet history shows clear patterns when it comes to the results of in-bred economic practices over time.
We can actually start with the plain fact that when fiat currencies, let alone hegemonic currencies like the US Dollar, start faltering because of how they were used, as well as their lack of support in a calculable reserve capital (such as the previous world concorde using the gold standard), there is a domino effect with a late clamour towards stable investments. Gold, silver and other metals will rise in price. This is a fact, observed like recorded weather patterns.

This post was published at Gold-Eagle on September 4, 2014.

Everything that’s wrong with banking summed up in one bonehead advertisement

If you’re looking around right now for a new bank account that pays a reasonable rate of return, ANZ bank has a hell of a deal for you: 0%!
That’s right. ANZ is offering its depositors absolutely zero interest.
Now, a bank paying 0% isn’t exactly abnormal in today’s banking environment. But what’s really strange is that ANZ actually took out an ad in an Australian newspaper to advertise this.
Yesterday’s page 10 of the Australian Financial Review (AFR) had a quarter-page ad from ANZ boasting about 0% interest rates for accounts denominated in number of foreign currencies, including Hong Kong dollars, Japanese yen, British pounds, and more.
Curiously, in order to qualify for this bargain 0% rate, you have to meet a rathersignificant deposit minimum.
For the 0% Japanese yen account, for example, you have to deposit 23.5 million yen (currently about $223,000 US dollars).
So basically some manager at ANZ actually thought that paying 0% interest on substantial account minimums would be an attractive offer…so attractive, in fact, that they should brag about it in the newspaper.
This is so completely ridiculous. But it really crystalizes what’s wrong with the entire financial system.

This post was published at Sovereign Man on September 4, 2014.

Gold and Miners About To Face Important Test

This is an excerpt from the daily StockCharts.com newsletter to premium subscribers, which offers daily a detailed market analysis (recommended service).
Most of the time gold and the dollar move in opposite directions. However, in the last few weeks the dollar has been rising sharply and gold has really been moving sideways. Now our inverted dollar diffusion indicator is deeply oversold and that may provide the price of the yellow metal with an escape hatch as the dollar corrects. However, the GLD really needs to break and hold decisively above the upper area of the trading range at $130 if it is to trigger some primary bull market signals.

This post was published at GoldSilverWorlds on September 4, 2014.

NATO Dead, King Dollar Wrecked

The Paradigm Shift has reached a higher gear. The danger and risk levels have gone to critical levels. The risk of economic destruction has gone into recognizable critical levels. The source of the problem has become more easily identified. The typical tactics not only do not work, but expose the bully, the warmonger, the hegemony advocate, the wizard of violence, the imposer of self-serving rules, the crime syndicate bosses, the masters of espionage, the man with killer drone toys. The USDollar is defended by war, market interference (see LIBOR, FOREX, debt ratings), accounting rules gimmicks, rigged detonation of banking systems, pointed assassinations for heads of state, even fabricated natural events (see HAARP in Philippines). The entire system is supported by Zero Interest Rate Policy (ZIRP) which distorts asset values and discourages savings. The misallocation of resources matches the wet blanket effect (see Money Velocity shutdown). The entire system is supported by Quantitative Easing (QE) which has monetized the USGovt bond market, the US property market, the US stock market, and soon possibly the US municipal bond market. The capital destruction is rampant, severe, and entering vicious feedback loops. The entire financial and economic system was held together in 2013 by cables and ropes in grand lashing style. The entire financial and economic system is now held together in 2014 by strings and howitzers, not to mention the endless sanctions and destructive rules, even punitive bank fines. The United States seeks to remain Lord of the Flies, its domain extended over a wrecked European continent. The main question is whether Europe will sign on to make a perverse corporatist trade union with a sinking millstone.
The United States seeks to pursue the Western totalitarian state by means of pulling down the European Economy, from the broken system to emerge the reconstruction of oppressive fascism. A wrecked Western Economy is pre-requisite. The small ray of light slips through, as the Fascist Business Model has a crack in it. Usually the big powerful corporations support the government fascist dictums. However, Exxon Mobil, Dutch Shell, British Petroleum, and Boeing stand in opposition to sanctions against Russia. The game is fast changing. The Emperor’s court is showing critical internal defections. The bigger ray of light comes from Germany, which shows important signs of refusal to permit its economic destruction in order to suit the elite plans of a grander fascist state. The Germans have suffered hyper inflation before, and will not again. The Germans have suffered a national calamity from an integrated fascist state, and will not again. It is becoming excruciatingly clear that the Global Axis of Fascism is the US, UK, and its leash holder in the SouthEast Mediterranean. The entire global system has reached the critical phase. The breakdown phase is accelerating.

This post was published at GoldSeek on 4 September 2014.

US Dollar Up – Everything Else Down (Except Trannies)

Draghi did it (or didn’t), blame him… From record intraday highs (on vapid volume) to 5-day lows in the S&P 500 as Mario Draghi cut rates even negative-er and promised to do more QEing. EURUSD collapsed over 2 big figures to 14-month lows below 1.2950. The implicit USD strength sparked selling in everything else. Treasuries pushed notably higher in yield (30Y 13bps on the week, 5Y 8bps) and held their yield highs as stocks started to collapse after Europe closed. The standard late-day machine-driven VWAP ramp lifted stocks off the lows, but S&P 2,000 remained elusive. Gold, silver, and oil all pushed lower as USD jerked higher. High-yield spreads jumped most in 6 weeks to 3-week wides and provided a warning to stocks all day. Bottom line – USD up, everything else down… (except Trannies).

This post was published at Zero Hedge on 09/04/2014.

Federal Reserve Warns That “College May Not Pay Off for Everyone”

Back in May, the one regional Fed that has come to symbolize everything that is wrong with being a “master of the obvious”, and conducting pre-K level research at the expense of millions in dollars in taxpayer funds, and also the Fed where the current Fed charimanwoman emerges from, that of San Francisco of course, conducted one of its trademark frontal lobe-combusting “studies.” Specifically, that purveyos of intellectual titanism asked (and answered) “Is It Still Worth Going to College?” The SF Fed’s answer, in a nutshell, was a resounding “yes” as one would expect of course: because in a world in which marginal revolving debt demand is virtually zero, the only source of consumer credit – that opiate for the Keynesian masses and certainly for their shamans – for the past five years, is simple: car loans and, to a far greater degree, student loans.
Which is why we were shocked to find today that the “other” Fed, the one housing the most powerful trading desk in the known world, that located at Liberty 33, today issued a research piece with a very different conclusion, namely that “College may not pay off for everyone.” But… that does not jive with the west coast Fed’s kindergarten level, blanket summary. How is this east-vs-west coast Fed rivalry possible?
For the answer, we go to the NY Fed’s paper, presented below.

This post was published at Zero Hedge on 09/04/2014.

Draghi and Company Stick a Fork in the Euro

“Stick a fork in it – it’s done!” is a common expression one hears down in Texas during Bar-B-Q season.
One could say the same thing about the Euro after the ECB slashed interest rates from 0.15% to a paltry 0.05%. I suppose the only thing left is to slash to absolute zero at this point and start handing out money to the general public.
Regardless, the Euro went “KERPLUNK” and the Dollar soared higher as the interest rate differentials between the two continue to be accentuated in the minds of forex traders.
Take a look at the Euro chart below. After a brief period of consolidation in early August, the currency has been careening lower, crashing through one layer of chart support after another.
If today’s low near the 1.300 level fails to generate any buyers, another 200 point plunge to down near 1.2800 is not out of the question. The RSI is deeply oversold but when it comes to currencies, oversold or overbought rarely mean much if anything. With the Eurozone economy sluggish at best ( and being hurt by sanctions imposed on Russia ), there is simply not much reason for traders to turn aggressive buyers of the common currency as the Central Bank is trying everything but its own version of QE at this point.

This post was published at Trader Dan Norcini on September 4, 2014.

Whats Next for the Dollar and Gold?

One reason markets tend to get a little nervous in September is that it’s time for investors to ponder about their asset allocation for the remainder of the year and beyond. With the markets at or near record highs and the US dollar on a roll, what could possibly go wrong? Let’s look at what’s next for the dollar, gold, and currencies.
A couple of highlights:
Equity markets are at or near record highs; Measures of complacency are near record levels (for example, the VIX index, a measure of implied stock market volatility, is near historical lows). 10 Year U. S. Treasuries are yielding around 2.4%, near record lows. The theory is that with the U. S. pulling ahead, the greenback must win. A couple of caveats to this theory:
The U. S. recovery might not be as healthy as it appears: the housing market remains vulnerable; many retailers have challenges; inventory stuffing might be happening at some tech firms; and how can the U. S. recover when Europe and parts of emerging markets are slowing down? U. S. real interest rates are increasingly more negative than Eurozone real interest rates. With the Fed all but promising to be late in raising rates, odds are that the differential will increase. In this context, the notion of an exit appears absurd.

This post was published at GoldSeek on 4 September 2014.

Economist: ‘This is Far From Over… They Know There Is a Problem Coming’

Well known Shadow Stats economist John Williams has warned time and again that the narrative being crafted by government statisticians, elite bankers and politicians is nothing but smoke and mirrors. With an election coming up in just a couple months, it’s highly unlikely that they’ll come out and tell us right now how fundamentally troubled our financial, economic and monetary systems really are.
But that doesn’t change the facts. The reality, as Williams notes in a recent interview with Greg Hunter’s USA Watchdog, is that the U. S. economy is in severe trouble and we may be just months away from the beginning of the next leg down, especially for the U. S. Dollar.
If we were to go back to the levels before the recession, we would need at least 11 million new jobs. That’s 11 million more than we have now. . . . We are in serious trouble here.

One of the best indicators is how people on Main Street, USA feel.
I found that those who live in the real world have a pretty good sense of what’s really going on.
If you don’t believe in the numbers coming out of the government, you’re probably right.
Over time… actual experience that trumps the romanticized numbers they’ve put together and we’re not seeing a recovery here. [We] haven’t had a recovery… the economy plunged into 2009… we had a financial panic… none of the issues have been resolved.
The economy has bottomed out. The banks are still in trouble. This is far from over.


This post was published at shtfplan on September 3rd, 2014.

ECB Meets To Tackle Deflation While Ignoring Shrinkflation

ECB Meets in Frankfurt
As the Governing Council of the European Central Bank (ECB) convenes today in Frankfurt for its monthly policy meeting, markets are focusing on how the ECB will signal the initiation of its quantitative easing (QE) programme which is aimed at countering deflationary forces in the Eurozone.
In August, the annual inflation rate in the Eurozone hit a precariously low rate of 0.3% per annum. This is far below the ECB’s target rate of 2% and also far below the average rate of inflation in the Euro area over the period 1991-2014, which was 2.18%.
Financial markets are already pricing in an ECB round of QE after ECB president Mario Draghi signalled such a move last month at the Jackson Hole central banker conference in the US, where he stated that the ECB would use ‘all available instruments’ to counter deflation.
European sovereign bond yields have fallen since Draghi’s August comments and the Euro has weakened against the US dollar. It is assumed that European QE would be in the form of a bond buying programme, much like the US and UK versions of QE that have already been implemented.
The ECB is already providing cheap liquidity to commercial banks in Europe though long-term refinancing operations, and since this is not providing the necessary stimulus to boost the Eurozone inflation rate, markets will be hanging on every word of Draghi’s speech today in Frankfurt so as to attempt to predict the exact timing of the commencement of the ECB’s quantitative easing programme.
While there is plenty of evidence that governments aim to minimise headline inflation figures for political reasons, financial markets still tend to fixate on these headline figures. Financial markets also get very concerned about deflation.

This post was published at Gold Core on 4 September 2014.

Unions are Not Capitalism

Labor unions are a dying breed. According tothe Pew Research Center, union membership in America ‘is at its lowest level since the Great Depression.’ In 1983, there were approximately 17.7 million union workers. Today, that numberstands at 14.5 million, with every estimate showing a continued downward trajectory. Clearly, the Norma Raes of the world are going extinct.
But as Samuel Johnson quipped, one should never dismiss the triumph of hope over experience. In celebration of Labor Day, the leftie rag New Republic recently published an interview with labor strategist Rich Yeselson defending the role of unions in the U. S. As a labor organizer, Yeselson’s bias is on full display. Instead of giving an objective view of stagnating union membership, he obfuscates to boost his own profession.
When asked if unions are dead, Yeselson rightly says ‘no’ while pointing out that millions of Americans are still active members. Unions not only retain fairly hefty membership, but also own valuable real estate in big cities and pension funds worth billions of dollars. Despite declining membership, there is still plenty of capital left over from organized labor’s heyday.
Fancy buildings and promised retirement benefits aren’t enough to reverse the downward trend however. Public opinion about unions is also on the decline. Between Volkswagen plant workers voting against joining the United Auto Workers and the confectionary company Hostess declaring bankruptcy to rid itself of unionized employees, there is a growing perception of greed directed at labor organizers. There is also the uncomforting fact that state and local governments – the industry most heavily unionized in the country – areunderwater on their pension obligations.

This post was published at Mises Canada on September 2nd, 2014.

Ecuador will be the First Country to Start Digital Currency

Ecuador has announced it will begin to circulate electronic currency created by its central bank in December. This is the way of the future. They often take a country like this for the test case. Ecuador will begin the process and we will see it swing to the USA and Europe during the decline in the ECM after 2015.75. This is the way to the future.
Ecuador’s currency is effectively the US dollar. Ecuador is planning to take the first step toward abandoning the country’s existing currency, the U. S. dollar as people perceive the action. But this is a trial run for the USA since it will be a digital replacement that is going to emerge as a new electronic currency.

This post was published at Armstrong Economics on September 3, 2014.

How is Doug Casey Preparing for a Crisis Worse than 2008?

He and His Fellow Millionaires Are Getting Back to Basics
Trillions of dollars of debt, a bond bubble on the verge of bursting and economic distortions that make it difficult for investors to know what is going on behind the curtain have created what author Doug Casey calls a crisis economy. But he is not one to be beaten down. He is planning to make the most of this coming financial disaster by buying equities with real value – silver, gold, uranium, even coal. And, in this interview with The Mining Report, he shares his formula for determining which of the 1,500 “so-called mining stocks” on the TSX actually have value.
The Mining Report: This year’s Casey Research Summit is titled “Thriving in a Crisis Economy.” What is the most pressing crisis for investors today?
Doug Casey: We are exiting the eye of the giant financial hurricane that we entered in 2007, and we’re going into its trailing edge. It’s going to be much more severe, different and longer lasting than what we saw in 2008 and 2009. Investors should be preparing for some really stormy weather by the end of this year, certainly in 2015.
TMR: The 2008 stock market embodied a great deal of volatility. Now, the indexes seem to be rising steadily. Why do you think we are headed for something worse again?

This post was published at Gold-Eagle on September 3, 2014.

Gold & Silver Trading Alert: Gold’s Plunge, Dollar, and CCI

Briefly: In our opinion no speculative positions in gold, silver and mining stocks are now justified from the risk/reward perspective. However, day-traders might consider a small speculative long position in silver.
The precious metals sector moved sharply lower yesterday – in tune with its medium-term trend. The decline was to a large extent connected with the breakout in the USD Index. It seems that it is the U. S. dollar that will determine the short-term moves in PMs and miners in the coming days and in today’s alert we focus on this relationship. The CCI Index seems to be in a particularly interesting position as well and this is something that gold & silver traders should be aware of.
Let’s start with the USD Index chart (charts courtesy of

This post was published at SilverSeek on September 3rd.

WHY BURGER KING’S EXPATRIATION IS THE MORAL THING TO DO

It was announced last week that Burger King had bought a famous Canadian restaurant franchise known as Tim Horton’s to reduce the amount of taxes they “owe” to the US government. An upcry arose!
As usual the mainstream media and the people who watch it have the story totally wrong. Burger King is not giving US taxpayers a “raw deal” by looking to move abroad so as to save on profits which are not repatriated. Instead, the iconic fast food burger chain is doing the moral thing by moving its tax-base outside the war-mongering, highly socialist US federal government’s reach.
The mainstream media will never give you this side of the story. This obvious trend towards expatriation terrifies the talking heads. You have to come to alternative media sources like The Dollar Vigilante (TDV) Blog and others to get the truth. As Howard Kurtz writes at Fox News,
I feel confident in saying that most Americans are disgusted by the perfectly legal practice of US companies avoiding taxes by incorporating in another country.
If this is the case, it is because Americans love bombing other countries. They lust for blood. I can think of no other logical explanation Americans would want the machine in Washington to continue being fed. Burger King is not the first company to make the moral decision to leave the US tax farm. Many American companies are going abroad – as many as 70. These so-called “inversions”. Even the most American of investors stand behind the inversion. Iconic American billionaire, Warren Buffet, coughed up $3 billion so the hamburger chain could buy the Canadian donut outfit Tim Hortons. Buffett did this just one month after Obama denounced ‘inversion’ tactics as an ‘unpatriotic tax loophole’, ordering regulatory changes to undermine them.

This post was published at Dollar Vigilante on September 2, 2014.