WARNING: The Coming Collapse Of U.S Net Worth Will Wipe Out Millions Of Americans

As the Financial Circus continues today, pushing down the precious metals prices, millions of Americans are going to get wiped out when the collapse of U. S. net worth begins in earnest. Anyone with a tad bit of common sense realizes these financial markets today are totally disconnected from reality.
With new stories of 40 million Russians to take part in ‘Nuclear Disaster’ drill, the Philippine President telling President Obama ‘To Go To Hell’, he’s buying weapons from Russia, U. S. Suspends Diplomatic Relations With Russia on Syria, U. S. Ends Fiscal 2014 With $1.4 Trillion Debt Increase: Third Largest In History, Deutsche Bank Troubles Raise Fear of Global Shock, it’s completely hilarious that the gold and silver prices are selling off big time today.
With 90% of the U. S. media now in control by six large mega-corporations, Americans have no idea just how bad the U. S. financial system has become. News stories today that would have caused a stock market crash and a spike in the precious metals years ago… no longer are a realistic barometer of the market today. Instead, the broader Stock, Bond and Real Estate Markets where 99% of Americans are invested, continue to be propped up.
How propped up? Well, let’s say by a staggering $31 trillion in the past six years. According to the wonderful folks at the Federal Reserve, U. S. net worth increased from $57.9 trillion Q2 2010, to a stunning $89 trillion Q2 2016:

This post was published at SRSrocco Report on October 4, 2016.

The Bond Market Is Flashing Red, Something Is About To Happen – Episode 1092a

The following video was published by X22Report on Oct 4, 2016
Corporations and financial institutions are continually laying off employees. Gold was brought below $1300. Subprime auto loans are back and they are getting ready to pop. NYC real estate is declining rapidly, there goes the real estate market. ISM employment crashes. US ends fiscal year with 1.4 trillion worth of debt. IMF sees inflation hitting the US much faster than the Fed. IMF has downgraded GDP again. Canada downgrades GDP. Italy is preparing for the collapse of Deutsche Bank. The bond market is flashing red, something big is about to happen.

The Fed and Politics

Inside Track
The stock market – where shares in profit-making companies are exchanged – went up again on Friday. Does this mean the outlook for making money is improving? Does this presage higher dividends for the stockholders? What, exactly, do investors expect?
More of the same, is our guess. Hillary in her Heaven. Yellen on her throne. And now, Fed Governor Lael Brainard is said to have the inside track for the top job at the Department of the Treasury. Wait a minute…
DJIA, daily. Recently the stock market has been stuck in a trading range, but last week the market went up on three days, including Friday. There seems to be a lot of complacency, which seems not exactly warranted – click to enlarge.

The Fed is supposed to be non-political. Yet here is a Fed governor angling for a job in the next Democratic administration. In the run-up to the presidential election, mightn’t she be inclined to keep stock prices high and interest rates low?
Mightn’t she be tempted to want to give her next boss a little boost? What steel strengthens her backbone, lest she bend to pick up the lure? What wax fills her ears, lest she hear the sirens’ call?

This post was published at Acting-Man on October 4, 2016.

Cheeseburgers, Pickups And Guns: “Off The Grid” Economic Indicators For Q3 2016

Cheeseburgers, Pickups And Guns: “Off The Grid” Q3 2016
Our quarterly look at unconventional ‘Off the grid’ economic indicators shows the challenges facing the U. S. economy, told through everyday items like bacon cheeseburgers and full sized pickups. The former shows the risks of systemic deflation, with food costs declining in a pattern reminiscent of past recessions. Pickup sales, a good proxy for small business growth, are now plateauing/declining modestly despite still-low gasoline prices. Taken in total, our indicators show a balanced picture of the American economy, but they point to a lackluster GDP growth rate (1-2%) for the second half of 2016. On the plus side are: steady used car prices, lower food stamp (SNAP) program participation, total automotive dealer inventories, and employee quit ratios. Indicators flashing yellow or red are: food deflation (that bacon cheeseburger), mutual fund outflows, pickup truck sales, and a Gallup survey of daily spending patterns. Somewhere in the middle are firearm background checks (a proxy for sales), which show 2016 will almost certainly be another record year for gun sales.
We’ve been doing these ‘Off the grid’ economic indicator pieces since shortly after the Financial Crisis and the most common question I still get is ‘Why?’ After all, the world is not short of economic indicators. Further, policymakers, academics, investors, and politicians all use the official playbook figures to set interest rates and macro policy. No one, to my knowledge, mentions used car pricing or gold coin sales in these deliberations.

This post was published at Zero Hedge on Oct 4, 2016.

Canada Moves To Burst Housing Bubble, Closes Foreign-Buyer Loophole

In a move which many Canadians, especially those who have been persistently priced out of the housing market, welcomed with open arms, overnight Finance Minister Bill Morneau unveiled new measures aimed at slowing the flood of foreign money pouring into overheated housing markets like Vancouver and Toronto, a move which some dubbed an unprecedented federal intervention in the sector.
As first reported by the Globe and Mail, Ottawa announced it would close a tax loophole that allows non-residents to buy homes and later claim a tax exemption on the sales.
According to the revision, the government will make sure the principal-residence exemption is only available to individuals who reside in Canada in the year the home is purchased, which immediately excludes thousands of “hot money” Chinese tourists who come to Canada simply to park billions in Chinese cash.
The Ottawa shift comes after home prices soared dramatically the last few years in the Vancouver and Toronto markets, triggering a vigorous debate about the role of foreign money. As reported in the summer, British Columbia imposed a 15-per-cent foreign buyers tax on homes which led to a dramatic cooling in the Vancouver housing market. Just today we learned that Vancouver home sales had plunged another 32.6% relative to a year ago as the market remains paralyzed as a result of a lack of buyers willing to chase near record prices.

This post was published at Zero Hedge on Oct 4, 2016.

Gold, Silver Are Your Safest Bets Right Now – David Morgan

The following video was published by The Morgan Report on Oct 4, 2016
If an investor is looking for safety, the best bets are to look at gold and silver, this according to well-known silver investor David Morgan. ‘I think the safest place to be right now is in the metals,’ he told Kitco News on the sidelines of the Mines & Money conference in Toronto. ‘I’d hold what I have, I wouldn’t add positions unless there’s extreme weakness.’ Also a speaker at the event, Morgan said he expects sideways trading for gold and silver ahead of the U. S. election and potential Fed tightening towards the end of the year. After that, he expects the metals to rally.

SP 500 and NDX Futures Daily Charts – Stocks Sell Off On Richmond Fed’s Hawish Statements

The Richmond Fed President Jeff Lacker made some noise this morning about the need for much higher interest rates now to head off inflation, and the markets used that as an excuse to sell off. This looks and smells like a trading gambit that Lacker merely served to feed.
The US dollar gained some strength, and the miners were pummeled.

This post was published at Jesses Crossroads Cafe on 04 OCTOBER 2016.

Key Breakdowns after Silver’s Final Reversal

The end of the previous week was rich in signals as gold, silver and mining stocks all reversed along with the USD Index. Gold closed the week below the rising support line and the implications should not be ignored even by those who usually focus on fundamentals alone.
Why? Because in the short- and medium term, the important technical developments will shape the price – not the fundamentals. Why should one care? In early 2008 silver was priced above $20 and in late 2008 it was priced below $10, even though the fundamental outlook didn’t change. Similar price swings can make a lot of money for those who pay close attention to what’s going on – but knowing about positive fundamentals is not enough.
In the following part of the alert, we’ll show you what technical signs were available on Monday and Friday (this article is based on our Monday’s and Friday’s Gold & Silver Trading Alerts – we had opened short positions in metals and miners on Friday) that warned about the looming slide.
Let’s take a look at the charts (charts courtesy of

This post was published at SilverSeek on October 4, 2016.

Assessing the Short-Term Outlook for the Precious Metals and the Miners

Precious metals expert Michael Ballanger assesses the gold-silver ratio and its ramifications for the market.
I want to go on the record and state categorically that, in my opinion, technical analysis is of limited value when trying to predict the short-term movements of precious metals. However, there are millions of traders and investors out there who believe that it does work despite interventions, manipulations, and the ability of the bullion banks to fabricate a surrogate for actual physical gold by way of paper futures. In light of that, the short-term technical set-ups for gold and silver and the miners are all different in that after Friday’s month-end bombardment, which originated in the London options market, that formidable uptrend line that began in December 2015 has finally been vanquished. The ramifications could be nasty next week because for the second year in a row, the seasonally strong month of September failed to shine (at least for gold). The big question is now whether or not we get a follow-through to the 200-dma at $1,252 before resuming the uptrend or will that large Commercial short position serve as a demand catalyst and limit any meaningful downside?

This post was published at GoldSeek on 4 October 2016.

Explaining Today’s Market Action (Hint: Blame Risk Parity)

‘You have to pick your poison — more risky assets or a more balanced basket with high leverage… There’s a philosophical
underpinning on why risk party has worked and why it should continue to work… Every time people talk about it as a leverage bond
portfolio, I just cry…. It’s not leveraged bonds. It’s a leveraged portfolio. ‘
–Edward Qjan of PanAgora Asset, who ‘coined’ the term ‘Risk-Parity’
Risk-parity 101: Leverage historically ‘low volatility’ asset classes (e.g. fixed income) / subsectors (utilities) alongside historically ‘higher volatility’ assets (stocks, EMFX, or the tech sector) to better ‘balance’ your multi-asset portfolio’s risk-allocation (which in a 60/40 equity/bond portfolio would see 90% of ‘risk’ concentrated on the equities side). Net / net, the strategy uses leverage to allocate ‘risk’ instead of allocating assets for diversification. Different parts of the economic cycle see different underlying asset class allocations (i.e. the current ‘low growth, low inflation’ backdrop), and now you’re cooking with grease – an ‘all weather’ portfolio, ahem.
Me, last month in ‘RBC Big Picture:’

This post was published at Zero Hedge on Oct 4, 2016.

Gold Daily and Silver Weekly Charts – All Hail The Recovery

‘When the system is rigged, when ordinary citizens are powerless, and when whistle-blowers are pariahs at best, three things happen. First, the worst people rise to the top. They behave appallingly, and they wreak havoc. Second, people who could make productive contributions to society are incented to become destructive, because corruption is far more lucrative than honest work. And third, everyone else pays, both economically and emotionally; people become cynical, selfish, and fatalistic. Often they go along with the system, but they hate themselves for it. They play the game to survive and feed their families, but both they and society suffer.’
Charles H. Ferguson, Inside Job
Gold and silver were hammered lower today, with gold losing 3.2% and silver 5.2%.
The dollar moved much higher as you can see from the chart below.
There was some brief intraday commentary on the premiums in some of the Trusts and Fundshere.
We may move lower if you look at the charts carefully, especially since we have a Non-Farm Payrolls event coming up, that is like a ringing dinner bell cue for the bears. Having said that, I put some cash that I had taken out last week back to work today. Let’s say that this move was not entirely unexpected given the setup.
The ‘precipitant’ for today’s action was a very hawkish speech on interest rates this morning by Jeff Lacker, President of the Richmond Fed.
Given the estimates I have been getting on the state of the ‘free float’ of bullion in the key market in London, it seems just as likely to me that this was a trading gambit devised to dampen the offtake of gold in the October contract, knock down the leveraged bets of paper to physical bullion, and to shake some additional gold lose from the ETFs where it has been accumulating.

This post was published at Jesses Crossroads Cafe on 04 OCTOBER 2016.

For Crispin Odey This Is The Engame: Hedge Fund Billionaire Goes All In Betting On “Violent Unwind” Of QE Bubble

In mid-August, when the market was enjoying its low-volatility grind higher, we observed that one of the biggest bears in the hedge fund industry, Crispin Odey, was having a bad year, with his hedge fund sinking some 30% through the end of July. Since then, conditions have only gotten more precarious for the billionaire hedge fund manager, and as the FT writes, for Odey, who is betting it all “on a violent unwind of a QE bubble”, the endgame may have arrived.
As Miles Johnson writes, “many financial commentators have warned that current monetary policy has inflated a bubble that will one day violently pop. Few of them have risked money betting on the precise manner in which a chaotic unwinding of quantitative easing will play out through financial markets. This makes the portfolio of Crispin Odey, a London-based hedge fund manager, an interesting outlier. Mr Odey is one of only a handful of investors who has backed up his dire prognosis for the global economy with a series of large, leveraged trades designed to pay off in the event of a crash.”
To be sure, as we noted two months ago, Odey’s bets are predicated on a collapse of Japanese bond prices, a surge in the price of gold and immolation of equities. Or as the FT puts, it, “If it works he may make hundreds of millions of dollars for his clients. If wrong his fund may not survive.”

This post was published at Zero Hedge on Oct 4, 2016.

GLOBAL MELTDOWN UPON US — Andy Hoffman

The following video was published by SGTreport.com on Oct 4, 2016
By all accounts, at least if you talk to those in the alternative media, Deutsche Bank is in the death throes, its Derivatives book making it too big to bail out – and yet without a bailout the collapse of Deutsche Bank will surely bring down other major international banks as well. Andy Hoffman from Miles Franklin returns to SGT Report to discuss the worsening global economic picture on a day in which gold and silver and associated mining shares were gutted along with any remaining confidence in Germany’s largest bank. Join us as we document the collapse for this first week of October, 2016.

Canada’s Fourth Largest Bank Erases $1 Billion In Excess Capital In Unexpected Accounting Gimmick

Early in 2016, when oil prices were plunging and when US banks were careful to push up their loan loss reserves to exposed E&P loans, we noted something surprising: Canadian banks had barely taken any loss reserves to their exposure in the oil and gas sector.
As and RBC report calculated at the time, if they used the same average reserve level as that applied by US banks, Canadian banks’ current loss allowance excluding RBC would surge from $170MM to over $2.5 billion, resulting in a substantial hit to earnings, and potentially impairing the banks’ ability to service dividends and future cash distributions.

This post was published at Zero Hedge on Oct 4, 2016.