Why Being ‘Certain’ Is Your Portfolio’s Worst Nightmare

How many of you approach life expecting ‘certainty?’ How many of you always see all your plans through life work out exactly as you had expected? Think back to just the past year alone, and ask yourself how well those things you were so ‘certain’ of last year have worked out.
Anyone who has any experience in life knows that life, by definition, is simply uncertain. I will give you a personal example. I was lucky enough to marry an incredibly wonderful woman, who also happened to be eight years younger than me. And, of course, we were looking forward to a long wonderful life together, and I fully, and ‘reasonably,’ expected to out-live her due to the difference in our ages. Yet, in an extremely unfortunate turn of circumstances, she contracted a very rare form of cancer when the youngest of our four children was 11 days old, which ultimately took her life.
Yes, my friends, there is no such thing as certainty in life. Yet, so many approach financial markets with a perspective of certainty. My question to you is why would you believe that the financial world is any different than the rest of the world? Why would you believe you can expect certainty in any part of your life, especially when dealing with your financial nest egg?
What scares me even more so for the average investor is when an ‘analyst’ tells you that something will happen in the market with ‘certainty.’ They tell you that you must buy a certain stock, or worse yet, a leveraged ETF (which have other major issues associated with them), because the market will ‘absolutely’ do something in the coming year. Some will even tell you that you should not use stops, and they even provide you with ridiculous reasons for ignoring basic, sound investment advice. They convince you with promises of huge returns. And, incredibly, they make these claims with even more certainty as the initial position they suggest goes further and further under water.

This post was published at GoldSeek on Sunday, 23 October 2016.

Central Bank Austria Claims To Have Audited Gold at BOE. Refuses To Release Audit Reports & Gold Bar List

After years of gradually securing its official gold reserves (unwinding leases) the central bank of Austria claims to have completed the audits of its 224 tonnes of gold stored at the BOE. However, it refuses to publish the audit reports and the gold bar list. What could possibly be so sensitive to hide from public eyes?
After the Germans had activated a program to repatriate 150 tonnes of their official gold reserves in 2012, which was revised in 2013 to have 50 % of their gold on German soil by 2020, and the Dutch repatriated 123 tonnes in 2014, the Austrians have likely been inspired by these initiatives – if European official gold policy is not adroitly aligned among national central banks behind the scenes. In 2015 the Austrian central bank, the Oesterreichische Nationalbank (OeNB), revealed it would repatriate a significant share of its yellow metal from the UK, where they were storing 80 % (224 tonnes) of their total reserves (280 tonnes) at the Bank Of England (BOE). The Austrians decided to eventually have 50 % of their gold on own soil by 2020 – just like the Germans.
Have a look below at the repatriation schedule of the OeNB for the period from 2015 until 2020. We can wonder why the gold is scheduled to be transported over the course of five years instead of a few months. My guess is this is caused by some kind of friction between the BOE and its foreign central bank clients, in this case the OeNB.

This post was published at Bullion Star on 22 Oct 2016.

I Went to a Wells Fargo Branch, this is What Happened Next

They have learned nothing.
I walked into my Wells Fargo branch to put my data backup into my safe deposit box, as I’ve been doing for a decade. This routine business turned into a wake-up call about safe deposit boxes and churned up insights into how Wells Fargo conducts to this day its cross-selling efforts: the algo makes them do it!
To clarify, I’m a happy customer. Wells Fargo handles day-to-day banking for me and my vast WOLF STREET media-mogul-empire corporation. The people are nice, and I have not yet noticed any fraudulent accounts in my name.
It doesn’t bother me that every time I call one of the national numbers with a problem or question, I have to swat away their offers of ‘pre-approved’ credit cards, lines of credit, or other high-margin products. Having run a car dealership earlier in my life, I appreciate the art of aggressive cross-selling. However, we never-ever did it over the phone! We waited till we saw the whites of their eyes.

This post was published at Wolf Street by Wolf Richter ‘ October 23, 2016.

Doug Noland: The Latest on China’s Mortgage Finance Bubble

This is a syndicated repost courtesy of Credit Bubble Bulletin. To view original, click here. Reposted with permission.
It’s been a full seven days since a CBB focused on China… Important – confirmation of the thesis – data again this week.
October 21 – Reuters (Yawen Chen and Nicholas Heath): ‘China’s new home prices rose in September at the fastest rate on record as buyers rushed to close contracts before new restrictive measures took effect in October. The boom in sales and prices was evident in mortgage lending, with new housing loans to individuals totaling 475.9 billion yuan in September alone, some 76% higher than the same month last year… Prices in China’s 70 major cities rose 11.2% in September from a year earlier, accelerating from a 9.2% increase in August, as 64 of them saw year-on-year price gains…’
Year-on-year prices were up 34.1% in Shenzhen, 32.7% in Shanghai, and 27.8% in Beijing.

This post was published at Wall Street Examiner by Doug Noland ‘ October 22, 2016.

Venezuela Braces For Revolution After Maduro Blocks Recall Referendum

Once a “flagship socialist nation,” Venezuela has suffered over the past couple of years from a dramatic economic crisis that has resulted in severe shortages of food, clean water, electricity, medicines and hospital supplies all of which have resulted in a desperate population which has resorted to the black market and violence for survival. That said, Venezuela likely inched one step closer to revolution on Friday when Maduro’s leftist government took steps to block a recall referendum that could have resulted in his ouster. According to the US News and World Report, Venezuelan opposition leaders are calling the efforts of Maduro “a coup” in light of the broad based public support of the recall effort.
Venezuela is bracing for turbulence after the socialist government blocked a presidential recall referendum in a move opposition leaders are calling a coup. The opposition is urging supporters to take to the streets, beginning with a march on a major highway Saturday led by the wives of jailed activists, while a leading government figure is calling for the arrest of high-profile government critics.
Polls suggest socialist President Nicolas Maduro would lose a recall vote. But that became a moot issue on Thursday when elections officials issued an order suspending a recall signature drive a week before it was to start.

This post was published at Zero Hedge on Oct 22, 2016.

Gold Daily and Silver Weekly Charts – All For One, And None For You

“But there is a sort of ‘Ok guys, you’re mad, but how are you going to stop me’ mentality at the top.”
Robert Johnson, Audacious Oligarchy
The US dollar continued powering higher today, which is not good at all for the real economy but certainly serves the global purposes of the financial class.
Gold and silver held their own against this, and a continuing decline in stock market volatility as measured by the VIX.
The deliveries were notable only for gold, as Macquarie continued to offer up their house account gold claim checks position, taken up largely by the bullion bank Nova Scotia and the ‘mystery customer’ at JPM.

This post was published at Jesses Crossroads Cafe on 21 OCTOBER 2016.

What I Learned from the Second Most Powerful Central Banker in the World

This is a syndicated repost courtesy of The Daily Reckoning. To view original, click here. Reposted with permission.
As many Americans settled down to prepare for the presidential debate Wednesday night, I was at a private dinner in New York City with William Dudley, president and CEO of the Federal Reserve Bank of New York and arguably the second most powerful central banker in the world after Janet Yellen.
The atmosphere was relaxed, and Dudley was generous with his time in discussing Fed monetary policy with me and our fellow dinner companions. Of course, he was circumspect and made it clear (as he always does) that his views were personal and not the ‘official’ views of the Federal Reserve System. Despite the disclaimer, there was no doubt in anyone’s mind that we were getting a privileged view inside the mind of one of the key monetary policymakers on the planet.
The most important view Dudley expressed was his belief that the Fed will raise interest rates ‘before the end of the year.’ There are only two Fed FOMC meetings between now and the end of the year: Nov. 2 and Dec. 14.

This post was published at Wall Street Examiner by James Rickards ‘ October 21, 2016.

Want To Boost Market Liquidity? Just Let It Rain… No Really

Last December, when we alerted readers to the shift in the “laser” tower at the “New York” Stock Exchange located in Mahwah, NJ…
… we wondered, rhetorically, “what would happen if one flies, say, a drone in front of one or all of those lasers during, say, peak market hours or, heaven forbid, just a few milliseconds before the Fed announces its next “most important ever” policy decision.”

This post was published at Zero Hedge on Oct 22, 2016.

Chinese Home Prices Surge Most On Record, Ignore “Cooling” Measures

Over the past month, one of the key Chinese economic themes has been Beijing’s tepid, if growing, desire to gradually deflate the country’s unprecedented housing bubble. Alas, according to the latest, September data, the government has so far failed to tame the epic homebuying frenzy it unleashed just over a year ago courtesy of a record debt and fiscal stimulus flood, when it in turn scrambled to offset the popping of the 2013 housing bubble (as a reminder, China’s economy is best described as a serial or parallel shift from one asset bubble to another).
According to China’s National Bureau of Statistics, average new-home prices in the 70 cities tracked surged by 1.8% in September from the month prior. On an annual basis, housing prices soared 11.2% year over year, after a 9.2% jump in August. This was the biggest annual jump on record, and the 12th consecutive month in year-over-year gains.

This post was published at Zero Hedge on Oct 22, 2016.

Week In Review: October 22, 2016

As the 2016 election draws near, the elephant in the room – whether the candidates and the public know it or not – remains the central bank and its continued power over both the domestic and global economy. There is good reason to believe, of course, that the Fed is actively crafting policy to avoid any economic crises before the election, in order to benefit the Clinton campaign. But, the evidence continues to mount that the Fed simply won’t succeed in its efforts to forever steer the economy with a team of technocratic elites. The Fed, for example, doesn’t understand how interest rates are truly formed in the marketplace, nor can it square the real long-term effects of inflation with its irrational fear of deflation. Worst of all, as central bankers continue with their public-relations tours, they drape themselves in the mantle of freedom and free markets.

This post was published at Ludwig von Mises Institute on October 22, 2016.

Six Things to Consider About Inflation

As an economic term, ‘inflation’ is shorthand for ‘inflation of the money supply.’
The general public, however, usually takes it to mean ‘rising prices’ which is not surprising since one of the common effects of an increase in the money supply is higher prices. However, supporters of government policy often say, ‘If quantitative easing (QE) and its terrible twin, fractional reserve banking, are so awful, why have we got no inflation?’
To address this conundrum, there are six related factors that are noteworthy:
Number One: we need to be clear about the terms we are using. Instead of talking about ‘inflation’ in the loose sense, as above, it is more accurate to speak of currency debasement, which is the real impact of fiat money creation by any means. We experience currency debasement as declining purchasing power. Two sides of the same coin: one reflects the other.
Number Two: the above question overlooks the fact that the measures used in this process are inherently unreliable. The decline in purchasing power is most evident when objectively measured by reference to an essential commodity such as oil – rather than against the Consumer Price Index (CPI). The CPI purports to reflect the prices of ingredients selected by government statisticians in what they consider to be a typical, but notional, basket of ‘consumer goods and services.’ This basket, whose contents are varied periodically, results in an index that cannot be trusted as an objective barometer. It supports the wizardry of non-independent Treasury statisticians, and relates to goods that scarcely feature in your shopping basket or mine.

This post was published at Ludwig von Mises Institute on October 22, 2016.

Socialism’s Community Organizers: Training Grounds of the Lunatic Left

Back in the 1980s, some conservatives began distinguishing between old-school, New Deal welfare statists like a Ted Kennedy, Hubert Humphrey or a Lyndon Johnson and the ‘Lunatic Left,’ the hardcore Marxist Left that had emerged from the universities in the 1960s. The former group ‘only’ wanted to tax and regulate capitalism; the latter group wanted to destroy it and replace it with as much totalitarian government control and domination that they could get away with in American society. They wanted the Sovietization of America, in other words. Indeed, many of them traveled to the Soviet Union, China, Cuba, and other socialist hellholes and returned to write books and articles about what a great utopia they had witnessed, as documented in the book Political Pilgrims by Paul Hollander. Unlike the old New Deal Cold Warriors, they were anything but anti-communist.
James Bennett and I wrote a 560-page book, published in 1985, entitled Destroying Democracy: How Government Funds Partisan Politics that discusses many of these characters, including one Robert Creamer, who has been all over the news recently for being videotaped bragging about how he orchestrates election fraud for the Democratic Party (See ‘Project Veritas’). The book was about the illegal use of tax dollars to subsidize mostly (but not exclusively) left-wing political pressure groups. The government gives them tax dollars under some noble-sounding guise like fighting poverty, helping the elderly, etc.; they use the tax dollars to lobby and agitate for bigger government, more regulation, and higher taxes instead; when they succeed the government then shares the loot with them and the cycle repeats itself. And it is all illegal.

This post was published at Lew Rockwell on October 22, 2016.

Post-Election Probabilities: Opportunities And Threats

Regardless of who wins the U. S. Presidency, there are Key Post-Election Economic and Market Events which are highly probable.
And the advance knowledge of these events will give well-informed Investors an Opportunity for Great Profit and to protect Wealth against Great Impending Threats. To understand these, consider the following overview.
U. S. Jobs Growth and Corporate Earnings are both Slowing.
And U. S. GDP and average hours Worked are all down-Trending as well. Indeed, the U. S. Industrial Economy has experienced 13 consecutive months of Negative Growth if one looks at the Real Numbers and not the Bogus Official ones. See Shadowstats Real Numbers Note 1, below.
And China’s exports and imports are both slowing.
And, with the British Pound and Japanese Yen both weakening vis vis the $US which has recently skyrocketed up over 98 basis USDX.
And the Currency War continues with China weakening it’s currency again.
And a Hard Brexit is becoming likely.
And perhaps most Threatening of all, Global Debt hit $152 Trillion according to the IMF – the largest Bubble of them all – and Central Bank Debt Purchases have now exceeded $21 Trillion! Practically speaking, much of this Debt can not be repaid.

This post was published at GoldSeek on Friday, 21 October 2016.

Moody’s: The M&A Market Is Flashing a Red Warning Sign

One of the most reliable indicators of a market peak is M&A. When profits near a cyclical peak, sales growth stagnates and the risk of missing earnings targets grows, managements chasing growth at any price, push takeover premiums to extremes.
Ultimately shareholders are the ones who have to pay the price when the wheels come off several years later so, naturally, investors become wary when M&A volumes spike.
Podcast: ECRI’s Lakshman Achuthan: US Economy Reaching a Turning Point
And now is the time for investors to start taking a more cautious stance according to a new report from Moody’s published this week.
The M&A Market Is Flashing a Red Warning Sign
Moody’s research shows that the previous two record highs for yearlong M&A activity involving at least one US-based company as either buyer or target occurred in the third quarter of 2007 and 2000’s first quarter. It comes as no surprise that further number crunching shows that these peaks were set only a few months after cycle peaks for pre-tax profits from current production. The cycle peaks for the yearlong averages of pre-tax profits from current production were set in Q4-2006 and Q4-1997, respectively.

This post was published at FinancialSense on 10/21/2016.

Bank of England: Taking the Banks’ Fraud Proceeds Slows Growth

This is a syndicated repost courtesy of New Economic Perspectives. To view original, click here. Reposted with permission.
Elite bankers and the pathetic economists who serve as apologists for their frauds specialize in proving our family saying that it is impossible to compete with unintentional self-parody. The subtitle of the WSJ article providing the latest proof is ‘Fines on banks translate into $5 trillion of ‘reduced lending capacity,’ bank says.’ The ‘bank’ referred to is the Bank of England, which is supposed to be the UK’s primary bank regulator. To be kind, the ‘study’ by BOE is so embarrassing that a better descriptor of the BOE would be ‘fraud enabler.’
‘The roughly $275 billion in legal costs for global banks since 2008 translates into more than $5 trillion of reduced lending capacity to the real economy,’ Minouche Shafik, a deputy governor of the Bank of England, told a New York conference of regulators and bankers Thursday.

This post was published at Wall Street Examiner by Devin Smith ‘ October 21, 2016.


‘Those who are capable of tyranny are capable of perjury to sustain it.’ – Lysander Spooner

We all know the BLS artificially suppresses the CPI through bullshit substitution adjustments, quality adjustments, and various other incomprehensible hedonic adjustments made by government apparatchiks at the behest of their politician bosses. Some obscure theoretical academic calculation called owners equivalent rent accounts for almost a quarter of the CPI weighting.
It has no relation to reality as it has increased by only 12% since 2012, while the Case Shiller Housing Price Index is up 52% over the same time frame. The median price of existing home sales is up 30% over the same time frame. It also has no relation to rent increases, as they have gone up 22% nationally since 2012. It’s essentially a made up number by goal seeking bureaucrats doing the bidding of their establishment masters.

This post was published at The Burning Platform on October 22, 2016.

‘Philanthropist’ George Soros Set To Make A Killing From Europe’s ‘Forced Migration’

Authored by Sam Gerrans, originally posted op-ed via RT.com,
The philanthropist George Soros recently published a letter in the Wall Street Journal entitled, ‘Why I’m Investing 500 million USD in Migrants’. In this article, I will be looking at that letter and separating what it means from what it appears to say. Soros’ letter begins: ‘The world has been unsettled by a surge in forced migration. Tens of millions of people are on the move, fleeing their home countries in search of a better life abroad. Some are escaping civil war or an oppressive regime; others are forced out by extreme poverty, lured by the possibility of economic advancement for themselves and their families.’
This is quite true. And Soros should know since his think tank is fully on board with that ‘forced migration’. He has either initiated it or facilitated it and, according to Viktor Orban, Prime Minister of Hungary (which is presently holding a referendum on whether to accept migrant quotas as demanded by the EU), as quoted by Bloomberg: ‘His name is perhaps the strongest example of those who support anything that weakens nation states, they support everything that changes the traditional European lifestyle […] These activists who support immigrants inadvertently become part of this international human-smuggling network.’
Soros-backed activists are at the center of that network.

This post was published at Zero Hedge on Oct 21, 2016.

Thermodynamic Oil Collapse Interview: Why The Global Economy Will Disintegrate Rapidly

The world is heading towards a rapid disintegration of its economic and financial system due to a ‘Thermodynamic oil collapse.’ I spoke with Dr. Louis Arnoux of nGeni, about the details of the thermodynamics of oil depletion and its impact on the global economy.
Unfortunately, the world is completely in the dark about this energy information and its dire implications to global economic trade and finance, in a relatively short period of time. I would like to emphasize that this Thermodynamic Oil Collapse Video is the most important interview I have ever done.
During the interview, Louis Arnoux discusses the dynamics of the ‘Thermodynamic oil decline’ using six slides, including one on his nGeni technology towards the end of the interview. The information in this interview is so important, Louis needed to take the extra time to explain these concepts in detail.

This post was published at SRSrocco Report on October 21, 2016.

This is a great way to make a lot of money overseas

I just had a great lunch with a couple of entrepreneurs that our Sovereign Man: Private Investor group funded a few months ago with a $1.5 million investment.
These guys are incredibly bright entrepreneurs, and they co-founded a wonderful business.
Essentially they’re becoming an Alibaba or Amazon.com, supplying business product needs from office furniture to welding equipment to printer cartridges to local Brazilian companies.
The business has been growing rapidly even though Brazil has been suffering its worst recession since the Great Depression.
Buying into great businesses is ALWAYS my preferred investment. In fact, I think that a great business is the best asset anyone can own.
In good times, a great business makes a LOT of money. In times of inflation, a great business holds its value and acts as a hedge against rising prices.
In times of deflation, a great business produces valuable cash profits.
And even in times of recession when poorly managed companies shrink and shutter, great businesses grow their market share and emerge from recession stronger than ever.

This post was published at Sovereign Man on October 21, 2016.

Former Haitian Senate President Calls Clintons “Common Thieves Who Should Be In Jail”

Despite repeatedly bragging about all the good work the Clinton Foundation did to help Haiti recover from the devastating 2010 earthquake, at least one Haitian, former Senate President Bernard Sansaricq, thinks it was the Clintons, not the Hiatian people, who benefitted most from the Foundation’s “charitable work” in Haiti. Appearing on a radio show last week, Sansaricq offered a scathing assessment of the Clinton’s track record in Haiti saying they are “nothing but common thieves…and they should be in jail.” Per PJ Media:
Sandy Rios of American Family Radio interviewed former Haitian Senate President Bernard Sansaricq on Thursday, and the enraged Haitian had nothing good to say about the Clintons. He angrily claimed that they brought their “pay to play” politics to Haiti at the expense of the Haitian people. Sansaricq said that the Clinton Foundation received 14.3 billion dollars in donation money to help with the relief effort. President Obama and UN Secretary General Ban Ki-moon put the Clinton Foundation in charge of the reconstruction, but Haiti has seen no help. The money all went to friends of Bill Clinton.
“They are nothing but common thieves,” the enraged Sansaricq told Rios. “And they should be in jail.”

This post was published at Zero Hedge on Oct 21, 2016.