Having taken out not just 1350 but also 1287 last week , how low could we go in the next 30 - 60 days ? Here is the work of Larry Edelson , fwiw ..... his key level is 1151 - at 7/17 !
http://www.tfmetalsreport.com/blog/4793/run-building-loan
( So , will the beatings continue ( manipulations such as the big April smash down and last week's attacks on the PMs ) until the proverbial morale improves ( bullion banks become net long in both gold and silver ) ?
A Run on The Building & Loan
Before we study this week's Commitment of Traders report, we first need stop by Bedford Falls, circa 1933.
So your first assignment this weekend is to watch this clip. On one level, it's a wonderful explanation and indictment of fractional reserve banking. For this discussion, it's a great metaphor for the global paper charade, derivative leveraged and rehypothecated gold and silver markets.
What is the evil Mr. Potter doing in the clip? He instituted a bank run by calling the loans of the Bank of Bedford Falls and the Bailey Brothers Building & Loan. Once the cash on hand was gone (illiquidity), there was no money left over to pay out to depositors. Mr. Potter then offers "50¢ on the dollar" to anyone so frightened as to take whatever they can get. As Tom says after hearing that Randall has taken Potter's offer, "better to get half than nothing". Then, later in the clip, George Bailey offers the true explanation:
"Can't you understand what's happening here? Don't you see what's happening? Potter isn't selling, Potter's buying? And why? Because we're panicky and he's not, that's why."
As we relate this to the precious metals, what do we see? The collection of Bullion Banks, primarily JPMorgan, are today's "Mister Potter". (In fact, many cinema historians believe that Capra broadly based the character of Mr Potter on J.P. Morgan himself.)
When QE∞ was announced, the Bullion Banks were net short 737 metric tonnes of paper gold. As of today's CoT report, The Banks are now short 44,000 contracts or just 136 metric tonnes. That's a staggering drop of over 81%! I'll go one further for you...since the CoT-cutoff last Tuesday, total gold OI has risen by over 16,000 contracts while price has fallen by $75. Clearly, the vast majority of those new 16,000 contracts were fresh Large and Small Spec shorts. If that's the case, then right now...right this very instant...the total net short position of The Gold Cartel is around 30,000 contracts or just 93 metric tonnes. An incredible reduction 87%, all while price has fallen nearly $500.
Specs have sold, motivated by either fear or greed, and The Bullion Banks have bought. Just like Mr. Potter, The Banks aren't selling, they're buying. Using the fear and greed of the public at large to position themselves to dominate in the future.
The same is obviously true in silver, too. From a net short position last autumn that nearly exceeded 50,000 contracts, today's CoT showed a Silver Commercial net short position of just 6,000 contracts. This is a drop in excess of 90%! Just like gold, the total silver OI has increased since Tuesday, rising 4,000 contracts on a price drop of nearly $2. If The Silver Commercials absorbed all of this selling through buying longs and covering shorts, the total Silver Commercial net short position as we head into the weekend is likely under 2,000 contracts. That's incredible! While silver has fallen from $35 to $20, the Banks have been buying, not selling, and this has helped them to decrease their net short position from 7,800 metric tonnes down to just 311 metric tonnes.
Again, like Mister Potter, the Cartel Banks are using the public panic to BUY, not sell. They are positioning themselves for the next move up. So, are you Randall? Are you Ed? Are you Ms. Thompson? Or are you George Bailey, willing to stand against Mr. Potter and hold firm, keeping your emotions in check and remaining rational.
Those who remain steadfast now, defiant against the naysayers, will ultimately be proven correct. More importantly, they will have safe harbor from the coming storm and a position of strength preserved for when the storm finally passes.
TF
Still the question remains when or rather if JP Morgan covers its gold contracts at Comex for June ?
http://www.caseyresearch.com/gsd/edition/golds-6-fall-leads-to-surge-in-chinese-and-asian-physical-demand-again
( I think take on PM data and C.O.T interpretation is better than Harvey's , however both are provided to give two points of view.... numerous interesting items of new both pertaining to the PMs and the world at large from both bloggers ! )
¤ YESTERDAY IN GOLD & SILVER
The gold price got sold down to a new low around 9:30 a.m. in Hong Kong trading on their Friday morning. From there, the price jumped ten bucks to just over $1,390 spot...and stayed very range bound above that price for the rest of Friday trading everywhere on Planet Earth yesterday.
Of course, every attempt to break above the $1,300 spot price mark got sold off. The New York high tick was recorded by Kitco at $1,300.20 spot.
Gold closed at $1,298.60 spot...up $20.80 on the day. Gross volume was pretty chunky at 205,000 contracts, as the 25% increase in gold margins had their intended effect.
Here's the New York Spot Gold [Bid] chart, so you can see the New York price action in greater detail. It should be obvious to all but the willfully blind, that the gold price was deliberately held below $1,300 spot...just like it was at the $1,400 spot price mark.
It was pretty the same price pattern in silver...complete with the 9:30 a.m. Hong Kong low price tick on their Friday morning. However silver managed to move above the $22 spot price mark...but not by much.
Silver closed at $20.12 spot...up 52 cents from Thursday's close. Gross volume was off the charts...and net volume was pretty decent as well...34,000 contracts.
The dollar index closed late Thursday afternoon in New York at 81.75...and then declined slowly to its low price tick of the day...81.65...at 10:30 a.m. Hong Kong time on their Friday. After that, it slowly rallied up to 81.90 shortly before 8:00 a.m. in New York. From that point, the rally accelerated, hitting its zenith [82.50] at 12:30 p.m. EDT...before selling off into the 5:15 p.m. close. The dollar index finished the Friday trading session at 82.41...up another 66 basis points.
The CME's Daily Delivery Report showed that 12 gold and 8 silver contracts were posted for delivery within the Comex-approved depositories on Tuesday.
Another day, another withdrawal from GLD. This time it was 173,966 troy ounces. And as of 10:44 p.m. EDT yesterday evening, there were no reported withdrawals from SLV.
The U.S. Mint had another sales report yesterday. They sold 9,000 ounces of gold eagles...2,000 one-ounce 24K gold buffaloes...and 600,000 silver eagles. Month-to-date the mint has sold 42,000 ounces of gold eagles...10,000 one-ounce 24K gold buffaloes...and 2,428,000 silver eagles. Based on these sales figures, the silver/gold sales ratio currently sits at just under 47 to 1.
Over at the Comex-approved depositories on Thursday, they reported receiving 5,247 troy ounces of silver...and shipped out 339,724 ounce of the stuff. The link to that activity is here.
In gold, these same depositories received 3,199 troy ounces...and shipped out 32,081 troy ounces. The link to that activity is here.
It was another busy day at the store on Friday...and like it has always been, silver sales were great, but gold sales were astonishing once again.
Well, my guess that there wouldn't be much in yesterday's Commitment of Traders Report turned out to be only half right. There were no changes worth noting in silver...but gold was a horse of a different colour.
In gold, the Commercial net short position declined by a very chunky 14,207 contracts, or 1.42 million ounces. The Commercial net short position is now down to only 4.41 million ounces...a level not seen, according to reader E.W.F..."since February 8, 2005." He also noted that the gold 'raptors'..."hold their biggest net long position since February 20, 2001."
The Big 4 short contract holders [which, of course, no longer includes JPMorgan Chase] are short 10.22 million troy ounces of gold which, on a 'net' basis, represents 31.9% of the entire Comex futures market in gold...once the market-neutral spread trades are subtracted from the total open interest.
The '5 through 8' short holders in gold are short an additional 4.60 million troy ounces of gold on a 'net' basis. That represents another 14.4 percentage points of the total Comex futures market on the short side.
So the 'Big 8' in total are short 46.3% of the entire Comex futures market in gold on a net basis...and are short 236% of the Commercial net short position, which is preposterous.
But to put things in perspective for gold, the 'Big 8' short holders in silver are short 252.5 million ounces of the stuff...and the Commercial net short position is only 29.8 million ounces...so that puts their combined short position at 1,080% of the Commercial net short position.
The 236 percent in gold...and the 1,080 percent in silver...are almost impossible to believe...but there they are...and will be even more over the moon in both metals as the Commercial net short positions in both shrinks to zero, which they're probably close to right now.
After the events of Wednesday and Thursday, it's a good bet that JPMorgan Chase is out of its silver short position...and if not out, then close enough that what remains of it no longer matters, as they are covered in other markets...particularly in gold...which they have an even bigger long position in now than they did at the Tuesday cut-off for yesterday's COT Report.
We'll only see these numbers IF the precious metal prices remain flat through the close of Comex trading on Tuesday, the cut-off for the COT Report on Friday, June 28th...and I certainly wouldn't bet the ranch on that.
Because Nick is celebrating his dad's 100th birthday, I don't have the "Days to Cover Comex Short Positions" graph that I normally post in this space. But to tell you the truth, dear reader, it doesn't matter anymore...as the precious metals world has now changed forever...even though it looks and feels the same as it did just days ago. It's what's changed under the hood that matters...and everything will be different going forward.
Here's a chart that Washington state reader S.A. sent our way yesterday. He obviously stole it from the stansberryresearch.com Internet site...and it needs no further explanation from me.
Since this is my Saturday column, I get to empty out my in-box with everything I've been saving all week...and that's what I've done. I hope you can find the time to read the stories that interest you...and there are a lot of must reads on the list.
* * *
Selected and non redundant news and views....
Hilsenrelevant Still? Fed Mouthpiece Unleashed To Save The Day Again
The 'Hilsenramp' is here. As U.S. equities look set to test previous all-time highs and important support (100DMA), the mouthpiece of the Fed proved his worth...WSJ's HILSENRATH: Analysis: Overlooked 'Dovish' Signals In Bernanke Press Conference...WSJ's HILSENRATH - Analysis: Markets Might Be Misreading The Fed's Messages
Apparently, everyone messed up - there is nothing but good news for the money-printing-addicts. Hilsenrath's "New York Fed" sources have yet to leak the 2013 year-end price target for the S&P 500 (though we expect that next).
I saw this Hilsenrath character on a youtube.com video the other day...and he's just a young kid. But The Wall Street Journal must pay him well to prostitute himself like that for the sake of Bernanke and the Fed. What happened to honest journalism? This Zero Hedge piece from early yesterday afternoon is courtesy of West Virginia reader Elliot Simon.
Doug Noland: Latent Market Bubble Risks
From my analytical framework, this was a critical week. I believe the “sophisticated” speculators came to realize they are suddenly on the wrong side of a rapidly changing financial and economic backdrop. I suspect that many of these market operators have held the view that this will all end badly – they just thought the Fed, BOJ and other central banks ensured they had more time to build on their vast fortunes. Meanwhile, the less sophisticated - that had funneled savings directly and indirectly into long-term bonds, corporate debt, MBS, emerging markets, municipal debt and equities – will come to realize there is significantly more risk in these markets than they had perceived (and been led to believe). The perception of endless liquidity now confronts the reality that global central banks and myriad financial products and speculative excesses have worked to foment very serious inherent market liquidity issues.
The increasingly unwieldy Chinese Bubble has to end at some point. The increasingly unwieldy Bernanke Fed-induced Bubble has to end at some point. It was a bit astonishing to watch such important developments unfold this week in Beijing and Washington. And the emerging markets now face the perfect storm.
The global risk backdrop has quickly become less latent – economic and market backdrops much more uncertain. Powerful de-risking/de-leveraging dynamics are now in play. Global market yields (and risk premiums) are adjusting to new risk and liquidity dynamics. Financial conditions have tightened meaningfully, especially in the now troubled emerging economies. Higher yields and risk premiums put a fragile Europe back in the spotlight. Forecasts for global growth must now come down, which implies risk to elevated earnings expectations. I would strongly argue that stock market multiples in the U.S. and elsewhere are much too high considering extraordinary risks and uncertainties. If the global government debt Bubble has begun to succumb, there are very challenging times ahead.
The global risk backdrop has quickly become less latent – economic and market backdrops much more uncertain. Powerful de-risking/de-leveraging dynamics are now in play. Global market yields (and risk premiums) are adjusting to new risk and liquidity dynamics. Financial conditions have tightened meaningfully, especially in the now troubled emerging economies. Higher yields and risk premiums put a fragile Europe back in the spotlight. Forecasts for global growth must now come down, which implies risk to elevated earnings expectations. I would strongly argue that stock market multiples in the U.S. and elsewhere are much too high considering extraordinary risks and uncertainties. If the global government debt Bubble has begun to succumb, there are very challenging times ahead.
Doug's weekly commentary over at the prudentbear.com every Friday is anabsolute must read for me...as it should be for you. I thank reader U.D. for sending it our way.
Tom Engelhardt: The making of a global security state
So in our age, considering the gigantism of the US surveillance and intelligence apparatus and the secrets it holds, it's a given that the leak, too, will become more gigantic, that leaked documents will multiply in droves, and that resistance to regimes of secrecy and the invasion of private life that goes with them will also become more global.
It's hard from within the US to imagine the shock in Pakistan, or Germany, or India, on discovering that your private life may now be the property of the US government. (Imagine for a second the reaction here if Snowden had revealed that the Pakistani or Iranian or Chinese government was gathering and storing vast quantities of private emails, texts, phone calls, and credit card transactions from American citizens. The uproar would have been staggering.)
As a result of all this, we face a strangely contradictory future in which ever more draconian regimes of secrecy will confront the urge for ever greater transparency. President Obama came into office promising a "sunshine" administration that would open the workings of the government to the American people. He didn't deliver, but Bradley Manning, Edward Snowden, and other leakers have, and no matter how difficult the government makes it to leak or how hard it cracks down on leakers, the urge is almost as unstoppable as the urge not to be your government's property.
It's hard from within the US to imagine the shock in Pakistan, or Germany, or India, on discovering that your private life may now be the property of the US government. (Imagine for a second the reaction here if Snowden had revealed that the Pakistani or Iranian or Chinese government was gathering and storing vast quantities of private emails, texts, phone calls, and credit card transactions from American citizens. The uproar would have been staggering.)
As a result of all this, we face a strangely contradictory future in which ever more draconian regimes of secrecy will confront the urge for ever greater transparency. President Obama came into office promising a "sunshine" administration that would open the workings of the government to the American people. He didn't deliver, but Bradley Manning, Edward Snowden, and other leakers have, and no matter how difficult the government makes it to leak or how hard it cracks down on leakers, the urge is almost as unstoppable as the urge not to be your government's property.
This longish essay was posted on the Asia Times website on Tuesday...and it's another worthwhile read that I've been saving for today's column. I thank Roy Stephens once again for sharing it with us.
Investigators want missile theory probed in the 1996 TWA Flight 800 crash
A handful of aviation experts, including a number of investigators who were part of the original probe of TWA Flight 800, have come forward in a new documentary to say evidence points to a missile as the cause of the crash off the coast of Long Island 17 years ago.
The New York-to-Paris flight crashed July 17, 1996, just minutes after takeoff from JFK Airport, killing all 230 people aboard. In the weeks that followed, the plane was reassembled in a hangar from parts retrieved from the sea. But the cause of the crash was not identified immediately, and after authorities said the crash was caused by static electricity ignited fuel fumes, many skeptics cast doubt on the theory. Adding to the controversy were multiple eyewitness accounts of a fireball going up from the ground and hitting the plane before it went down, accounts which the FBI dismissed at the time.
The half-dozen investigators whose charges will be fleshed out in a documentary set to air July 17 - the anniversary of the crash - say they were never allowed to get at the truth. But they are confident a missile brought down the plane.
"We don't know who fired the missile," said Jim Speer, an accident investigator for the Airline Pilots Association, one of a half-dozen experts seeking a new review of the probe. "But we have a lot more confidence that it was a missile."
It's always been my personal belief that 9/11 was an inside job...and the 'official' reason that TWA Flight 800 crashed falls into that same category as far as I'm concerned. This must read story was posted on the foxnews.com Internet site on Wednesday...and I found it in the Thursday edition of the King Report.
British spy agency has access to global communications, shares info with NSA
The British spy agency GCHQ has access to the global network of communications, storing calls, Facebook posts and internet histories – and shares this data with the NSA, Edward Snowden has revealed to The Guardianin a new leak.
GCHQ’s network of cables is able to process massive quantities of information from both specific targets and completely innocent people, including recording phone calls and reading email messages, it was revealed on Friday.
"It's not just a US problem. The UK has a huge dog in this fight," Snowden told The Guardian. "They [GCHQ] are worse than the US."
The Government Communications Headquarters agency has two different programs, aimed at carrying out this online and telephone monitoring – categorized under ‘Mastering the Internet’ and ‘Global Telecoms Exploitation.’ Both have been conducted in the absence of any public knowledge, reports The Guardian.
This news item was posted on the Russia Today website yesterday afternoon Moscow time...and it's another contribution from Roy Stephens.
Tumult in Athens: Greek Government Wobbles as Coalition Splits
Last June, Antonis Samaras was sworn in as Greek prime minister, the head of a three-party coalition tasked with knitting together a divided society and repairing his country's broken economy. Now, exactly one year later, that coalition officially belongs to the past. On Friday, the Democratic Left said it was withdrawing its ministers from the cabinet and would only provide qualified support to the government from here on out.
The announcement was made by Democratic Left leader Fotis Kouvelis. He said he was left with little choice following the government's abrupt closure last week of the state broadcaster ERT.
The departure of the Democratic Left means that Samaras will now be forced to govern with an extremely narrow majority in the 300-member parliament. His conservative New Democracy party has 125 delegates who are joined by their 28 socialist coalition partners from PASOK. The government can also count on the support of some independent deputies.
As such, the catastrophic scenario of snap elections during the crucial summer tourism season -- which had seemed almost inevitable last week -- has been avoided. In a televised statement late on Thursday night, Samaras insisted his government would serve its full four-year term. "Our aim is to conclude our effort to save the country," he said.
This article appeared on the German website spiegel.de late yesterday afternoon Europe time...and it's also courtesy of Roy Stephens.
Erdogan and the Protests: Turkey's Stubborn Man on the Bosphorus
Turkish Prime Minister Recep Tayyip Erdogan was on the way to becoming the most successful leader of his country since Atatürk. But he has reacted to recent protests as a tone-deaf despot. It is a tragedy for him and his country.
After 10 years as prime minister of Turkey, Erdogan had so much power that, in the end, only one person could stop him: Erdogan himself.
Journalist Fiachra Gibbans aptly described Erdogan's political career in theGuardian recently as a "Shakespearean tragedy." The prime minister, who defied attempted coups and survived a court challenge, is now in trouble because of a few hundred trees in a city park. He is becoming the victim of his own hubris.
This is another spiegel.de story from yesterday that's courtesy of Roy Stephens.
U.S. - Taliban Talks in Doha: The West's Capitulation in Afghanistan
After 12 years of war and thousands of deaths on both sides, the US and the Taliban are finally ready to talk peace. While the West hopes to smooth its withdrawal, human rights organizations forecast the return of dark times for women and minorities.
On Tuesday, the Taliban held an opening celebration for its new office in Doha, the capital of Qatar. The Islamists want to host peace negotiations there with the Afghan government and the White House. Afghan President Hamid Karzai remains coy on the issue, but talks between the Taliban and the US government are supposed to kick off within the next few days.
The parties to the conflict have already been holding secret talks for some years, and representatives have also met in Germany on several occasions. But now, for the first time since the beginning of international military intervention in the Hindu Kush in 2001, the Taliban will take an official seat at the negotiation table. The extremists had refused to participate in any of the previous Afghanistan conferences, which have been held at irregular intervals.
This interesting story from the spiegel.de website on Friday is another must read for all students of the "New Great Game"...and it's Roy's final offering in today's column.
Riot after Chinese teachers try to stop pupils cheating
The relatively small city of Zhongxiang in Hubei province has always performed suspiciously well in China's notoriously tough "gaokao" exams, each year winning a disproportionate number of places at the country's elite universities.
Last year, the city received a slap on the wrist from the province's Education department after it discovered 99 identical papers in one subject. Forty five examiners were "harshly criticised" for allowing cheats to prosper...so this year, a new pilot scheme was introduced to strictly enforce the rules.
When students at the No. 3 high school in Zhongxiang arrived to sit their exams earlier this month, they were dismayed to find they would be supervised not by their own teachers, but by 54 external invigilators randomly drafted in from different schools across the county.
The invigilators wasted no time in using metal detectors to relieve students of their mobile phones and secret transmitters, some of them designed to look like pencil erasers.
If this story hadn't shown up in a respectable newspaper, I would have probably dismissed it outright. But it was posted on the telegraph.do.ukInternet site on Thursday afternoon BST...and it'd definitely worth reading. I thank U.A.E. reader Laurent-Patrick Gally for bringing it to my attention...and now to yours.
Three King World News Blogs
1. Nigel Farage: "The Government is Going to Steal Your Money". 2.Andrew Maguire: The World Just Witnessed Massive Shift in Physical Gold". 3. Paul Craig Roberts: "Fed Orchestrated Gold Plunge".
Gold’s 6% Fall Leads To Surge In Chinese & Asian Physical Demand Again
The price drop has again led to increased demand in China and much of Asia. Reuters report that traders say that China “snapped up bullion at lower prices.” In Thailand, gold shops on Bangkok’s Chinatown saw huge demand as people rushed to buy gold at bargain prices (see photo).
As gold prices in China have dropped continuously in the past week, the volume traded in the Shanghai Gold Exchange climbed to a one month high on Wednesday. Volume for cash bullion of 99.99% purity on the Shanghai Gold Exchange climbed to 21,776 kg yesterday, the highest level since May 24, vs. 19,175 kg on June 18, according to Bloomberg.
This Goldcore commentary from yesterday found a home over at thegoldseek.com Internet site...and it's definitely worth reading. I thank Elliot Simon for another contribution to today's column.
China grows big enough to control Silver prices
They are also raising a sample question as what happens to the price of silver if these large sellers decide to start trading their humongous forex reserves and accumulating silver?
China is moving along that line, said many analysts after the dragon nation stops silver sales against worthless fiat currencies while India continued to sell silver.
The Chinese may very well decide it is better to hang on to what they have left in their stockpile, rather than continue to trade it for increasingly worthless fiat currencies. The Chinese are aware of the fact that silver bullion stockpiles are depleting and prices may go up soon.
Chinese authorities even advertised to encourage people to buy silver after introducing silver bars for investment. They knew that these millions of Chinese silver investors could raise silver prices and they have plenty of them in hand.
This very interesting read was posted on the bullionstreet.com Internet site early Tuesday afternoon IST...and it's certainly worth your time.
¤ THE WRAP
* * *
With everyone thinking that there's still more pain to come, I'll put my marker down here and say that a major bottom in gold and silver was set in early trading in the Far East on their Friday morning.
It's my opinion that the Commercial net short positions in both gold and silver are only tiny remnants of what they used to be...if they exist at all after Wednesday and Thursday's engineered price decline...and if they do exist, they are now immaterial in the grand scheme of things. Could JPMorgan go after them as well? I suppose, but if that was the plan, why didn't they press their advantage on Friday in London and New York when the precious metal markets were already beaten to the ground...and bearish sentiment was running rampant?
It's also my opinion that the Fed, through its agent JPMorgan Chase, is about to play the only real card it has left in its arsenal...and that's the gold card...something I've spoken about on many occasions in this column over the years. If there ever was a time for that to happen, it would be now. I can't think of any other reason why the U.S. bullion banks would be in such an obvious hurry to get long the precious metals market...particularly gold.
Of course many other analysts/commentators have voiced the same opinion over the years...and I feel that the moment has arrived, or is very close at hand. And as I said yesterday, it's only the timing I'm unsure of. But if this is their plan, then we shouldn't have long to wait.
* * *
http://harveyorgan.blogspot.com/2013/06/physical-demand-skyrockets-from-gold.html
Saturday, June 22, 2013
Physical demand skyrockets from the gold smashdown (Andrew Maguire)/Russia adds another 200,000 oz of physical/GLD drops another 5.41 tonnes/JPMorgan's dealer inventory declines/total comex dealer gold declines as does all comex gold/
Good evening Ladies and Gentlemen:
Gold closed up by $5.50 to $1291.70 (comex closing time ). Silver rose by 14 cents to $19.96 (comex closing time)
In the access market at 5:00 pm, gold and silver finished trading at the following prices :
gold: 1298.60
silver: $20.12
At the Comex, the open interest in silver surprisingly rose by 2172 contracts to 153,878 contracts despite silver's massive fall in price on Thursday. The silver OI is still holding firm at these highly elevated levels and closing in on record level highs. This is most unusual as silver is down 59% from its highs. As I mentioned to you on Thursday, the bankers will try and do everything possible to remove as many longs from the silver arena as possible. The high OI in silver could only mean somebody with huge deep pockets is standing and of course quite impervious to the pain of huge losses (e.g. a sovereign like China)
The open interest on the entire gold comex contracts astonishingly rose by 10,694 contracts to 393,277 despite gold's mauling on Thursday. The number of ounces which is standing for gold in this June delivery month rose to 944,700 or 29.38 tonnes. The number of silver ounces standing in this non active month of June also remains constant at 705,000 oz
Tonight, the Comex registered or dealer inventory of gold lowers in inventory to 1.430 million oz or 44.47 tonnes. This is still dangerously low. The total of all gold at the comex also lowers to 7.677 million oz or 238.78 tonnes of gold.
JPMorgan's customer inventory rises due to an adjustment, to rest tonight at 141,197.86 oz or 4.39 tonnes. Its dealer inventory lowers to 408,709.033 oz but it still must settle upon contracts issued in the June delivery month which far exceeds its inventory.
The total of the 3 major gold bullion dealers( Scotia , HSBC and JPMorgan) in its gold Comex dealer account registers only 29.98 tonnes of gold
The GLD reported a loss in inventory of 5.41 tonnes of gold inventory. The SLV inventory of silver showed a minor loss in inventory of 483,000 oz.
Kingworldnews and Eric King provide three great interviews with Keith Barron, Andrew Maguire and Dr Craig Roberts.
We also have commentaries from Michael Snyder, of Economic Collapse,Dr Craig Roberts and two great papers from Pivotfarm.
We will go over these and many other stories but first.....................
Let us now head over to the comex and assess trading over there today.
Here are the details:
The total gold comex open interest rose by an astonishingly high 10,694 contracts from 382,583 up to 393,277 with gold falling by $87.60 yesterday.With that kind of whack on gold with an open interest rising means that we have two events happening at the same time: 1) new contract shorts (probably hedge funds) and new longs (the banks). This no doubt will set up the ultimate confrontation when gold will be bid up with an event and there will be no supply as everyone is bidding, the banks bidding with investors for metal but this time with the hedge funds bidding (who are short). The hedge funds will be begging to buy back their shorts with no supply coming forth. The front active month of June saw it's OI rise by 45 contracts from 904 up to 949. We had 1 delivery notice served upon our longs on Thursday,thus we gained 46 gold contracts or 4600 additional ounces will be standing in this June delivery contract month. The next delivery month is the non active July contract and here the OI fell by 99 contracts down to 522. The next active delivery month for gold is August and here the OI rose by a huge 9676 contracts from 217,619 up to 227,295. The estimated volume (Friday) was good at 184,408 contracts. The confirmed volume on Thursday was humongous at 391,392 (39,139,200 oz or 1217 tonnes of gold or 55% of annual gold production ex China ex Russia).
Gold closed up by $5.50 to $1291.70 (comex closing time ). Silver rose by 14 cents to $19.96 (comex closing time)
In the access market at 5:00 pm, gold and silver finished trading at the following prices :
gold: 1298.60
silver: $20.12
At the Comex, the open interest in silver surprisingly rose by 2172 contracts to 153,878 contracts despite silver's massive fall in price on Thursday. The silver OI is still holding firm at these highly elevated levels and closing in on record level highs. This is most unusual as silver is down 59% from its highs. As I mentioned to you on Thursday, the bankers will try and do everything possible to remove as many longs from the silver arena as possible. The high OI in silver could only mean somebody with huge deep pockets is standing and of course quite impervious to the pain of huge losses (e.g. a sovereign like China)
The open interest on the entire gold comex contracts astonishingly rose by 10,694 contracts to 393,277 despite gold's mauling on Thursday. The number of ounces which is standing for gold in this June delivery month rose to 944,700 or 29.38 tonnes. The number of silver ounces standing in this non active month of June also remains constant at 705,000 oz
Tonight, the Comex registered or dealer inventory of gold lowers in inventory to 1.430 million oz or 44.47 tonnes. This is still dangerously low. The total of all gold at the comex also lowers to 7.677 million oz or 238.78 tonnes of gold.
JPMorgan's customer inventory rises due to an adjustment, to rest tonight at 141,197.86 oz or 4.39 tonnes. Its dealer inventory lowers to 408,709.033 oz but it still must settle upon contracts issued in the June delivery month which far exceeds its inventory.
The total of the 3 major gold bullion dealers( Scotia , HSBC and JPMorgan) in its gold Comex dealer account registers only 29.98 tonnes of gold
The GLD reported a loss in inventory of 5.41 tonnes of gold inventory. The SLV inventory of silver showed a minor loss in inventory of 483,000 oz.
Kingworldnews and Eric King provide three great interviews with Keith Barron, Andrew Maguire and Dr Craig Roberts.
We also have commentaries from Michael Snyder, of Economic Collapse,Dr Craig Roberts and two great papers from Pivotfarm.
We will go over these and many other stories but first.....................
Here are the details:
The total gold comex open interest rose by an astonishingly high 10,694 contracts from 382,583 up to 393,277 with gold falling by $87.60 yesterday.With that kind of whack on gold with an open interest rising means that we have two events happening at the same time: 1) new contract shorts (probably hedge funds) and new longs (the banks). This no doubt will set up the ultimate confrontation when gold will be bid up with an event and there will be no supply as everyone is bidding, the banks bidding with investors for metal but this time with the hedge funds bidding (who are short). The hedge funds will be begging to buy back their shorts with no supply coming forth. The front active month of June saw it's OI rise by 45 contracts from 904 up to 949. We had 1 delivery notice served upon our longs on Thursday,thus we gained 46 gold contracts or 4600 additional ounces will be standing in this June delivery contract month. The next delivery month is the non active July contract and here the OI fell by 99 contracts down to 522. The next active delivery month for gold is August and here the OI rose by a huge 9676 contracts from 217,619 up to 227,295. The estimated volume (Friday) was good at 184,408 contracts. The confirmed volume on Thursday was humongous at 391,392 (39,139,200 oz or 1217 tonnes of gold or 55% of annual gold production ex China ex Russia).
It is also interesting that we have no liquidation in gold despite a huge 25% increase in margins courtesy of the crooked CME.
The total silver Comex OI also astonishingly rose by 2172 contracts despite silver falling in price Thursday by a monstrous $1.80. As I stated Thursday night,the big test would be if the longs in silver remained resolute, willing to take on the criminal bankers. You now have your answer and thus no doubt we have a sovereign standing for much of silver (and most likely China). The front non active June silver contract month shows no change in OI at 25. We had 0 notices filed on Thursday so in essence we neither gained nor lost any silver contracts. The next big delivery month is July and here the OI fell by only 3446 contracts down to 49,303. We have exactly 1 week to go before first day notice (June 28.2013) and judging from the relatively high OI in July, we may see some fireworks in silver. The estimated volume today was excellent coming in at 76,703 contracts. The confirmed volume on Thursday was astronomical at 168,947. The volume on Thursday in oz is 840 million oz or a little more than 100% of annual global silver production from all mines.
Comex gold/May contract month:
June 21/2013
the June contract month:
the June contract month:
Ounces
| |
Withdrawals from Dealers Inventory in oz
|
nil
|
Withdrawals from Customer Inventory in oz
|
32,017.215,(Brinks,Scotia)
|
Deposits to the Dealer Inventory in oz
|
3199.74 (Brinks)
|
Deposits to the Customer Inventory, in oz
| nil |
No of oz served (contracts) today
|
1 (100 oz)
|
No of oz to be served (notices)
|
903 (90,300 oz
|
Total monthly oz gold served (contracts) so far this month
|
8498 (849,800 oz)
|
Total accumulative withdrawal of gold from the Dealers inventory this month
|
78,856.579 oz
|
Total accumulative withdrawal of gold from the Customer inventory this month
| 291,170.22 oz |
We again had good activity at the gold vaults
The dealer again had 1 deposit and no withdrawals.
Into Brinks; 3,199.74 oz (we will explain below where that gold went)
Into Brinks; 3,199.74 oz (we will explain below where that gold went)
We had zero customer deposits today :
total customer deposits: zero
It is very strange that in a big delivery month, we are witnessing hardly any gold enter the dealer or even the customer.
we had 2 customer withdrawals:
i) Out of Scotia 32,017.215 oz
ii) Out of Brinks: 64.30 oz
total customer withdrawals: 32,081.515 oz
Friday we had two major adjustments:
i) Out of Brinks: some of the deposit received from Brinks was adjusted out of the dealer and it landed in the customer account: the amount...1999.98 oz
This no doubt settled some of the issuance from Brinks this week.
ii) Our good friends at JPMorgan were at it again Friday night:
a rather large 4817.251 oz was adjusted out of the dealer and this landed in the customer account.
Thus tonight we have the following JPMorgan gold inventory:
JPM dealer inventory: 408,709.033 oz 12.17 tonnes (prev 413,526.284 oz)
JPM customer inventory: 141,197.86 oz or 4.39 tonnes (prev 136,380.611 oz)
As we reported to you two weeks ago, that JPMorgan withdrew a huge amount of gold from its customer account:
Out of JPMorgan: 217,844.96 oz.
If you will recall, we needed to see 100,000 oz of gold removed from JPMorgan's customer account. (1000 contracts served upon our longs in mid May).
The last Tuesday in May, we had 15,416.93 oz removed from the JPM's customer account. No doubt that this gold was part of the 1000 contracts issued by JPMorgan customer account and thus we calculated that as of last night 28,389.579 oz was settled upon, leaving 71,611.00 oz still left to arrive in the settling process.
Last Tuesday, June 11, we had 217,844.96 actual ounces leave JPMorgan
Friday, the CME reported that 70 notices were issued of which 38 came from JPMorgan and all of the JPMorgan issuance was from its customer or client account. The other three bullion banks remained pat.
In summary on the customer side of things for JPMorgan:
Today 38 notices were served upon our longs from the JPMorgan's customer side
and zero from its dealer side.
Thus:
From the beginning of June we have had 1591 notices served from the customer side of JPMorgan for 159,100 oz. If we add the 71,611.00 oz owing from May issuance, we get 230,711 oz. If we subtract the actual withdrawal of gold from JPMorgan of 217,844.96, this still leaves 12,867.04 oz that needs to be settled upon from the vaults of JPMorgan customer side. Let us see how JPMorgan settles upon the new 4,817.251 oz of gold received on Friday from its dealer account into its customer account.
The total dealer comex gold falls 1.430 million oz or 44.47 tonnes of gold.
The total of all comex gold, dealer and customer rests tonight at 7.677 million oz or 238.78 tonnes..
Now for JPMorgan's dealer side and what the inventory should be:
On June 11.2013 we reported that 4935 contracts have been issued by JPMorgan's house account since first day notice and not yet subtracted out of inventory
You will also recall two weeks ago on Saturday (and again on that following Monday night,) I reported that JPMorgan had 470,322.102 oz in it's dealer account. From that day until now, 61,613.07 oz was either withdrawn or adjusted out, leaving the dealer side at 408,709.033 oz where it sits tonight.
On the dealer side here are the last 10 trading sessions as to notices issued from JPMorgan's dealer side:
Friday: zero
Monday: 1
Tuesday: 0
Wednesday : 0
Wednesday : 0
Thursday: 0
Friday: 0
Monday: 0 .
Tuesday: 0
Wednesday: 0
Thursday: 0
Friday: 0
Thus, 4946 notices have been issued by JPMorgan (dealer side) so far in June for 494,600 oz and these ounces have yet to settle from JPMorgan's dealer side.
JPMorgan's dealer vault registers tonight 408,709.033 oz.
Somehow we have a huge negative balance as i) the gold has not left JPMorgan's dealer account and has yet to settle
and
ii) it is now deficient by 85,890.97 oz (408,709.03 inventory - 494,600 oz issued = 85,890.97 oz)
In other words, the entire 408,709.03 oz must be first transferred out of Morgan's dealer category ( in the same format as in the customer category) leaving it with zero, plus the 85,890.97 of additional deficient gold
JPMorgan has not had any deposits in gold in quite some time. As a matter of fact, zero ounces has entered on the dealer side from the beginning of 2013.
How will JPMorgan satisfy this shortfall??
Friday: 0
Monday: 0 .
Tuesday: 0
Wednesday: 0
Thursday: 0
Friday: 0
Thus, 4946 notices have been issued by JPMorgan (dealer side) so far in June for 494,600 oz and these ounces have yet to settle from JPMorgan's dealer side.
JPMorgan's dealer vault registers tonight 408,709.033 oz.
Somehow we have a huge negative balance as i) the gold has not left JPMorgan's dealer account and has yet to settle
and
ii) it is now deficient by 85,890.97 oz (408,709.03 inventory - 494,600 oz issued = 85,890.97 oz)
In other words, the entire 408,709.03 oz must be first transferred out of Morgan's dealer category ( in the same format as in the customer category) leaving it with zero, plus the 85,890.97 of additional deficient gold
JPMorgan has not had any deposits in gold in quite some time. As a matter of fact, zero ounces has entered on the dealer side from the beginning of 2013.
How will JPMorgan satisfy this shortfall??
Another disturbing piece of news is the low dealer gold inventory for our 3 major bullion banks: Scotia, HSBC and JPMorgan equal to 29.98 tonnes
i) Scotia: 285,596.23 oz or 8.88 tonnes (same)
ii) HSBC: 270,197.277 oz or 8.4 tonnes (same)
iii) JPMorgan: 408,709.033 oz or 12.71 tonnes (prev 413,526,284 or 12.86 tonnes)
Brinks dealer account has the lions share of the dealer gold at 446,698.99 oz 13.894 tonnes.
Today we had 70 notices served upon our longs for 7,000 oz of gold. In order to calculate what I believe will stand for delivery in June, I take the OI standing for June (949) and subtract out today's notices (70) which leaves us with 879 contracts or 87,900 oz left to be served upon our longs.
Thus we have the following gold ounces standing for metal in June:
8568 contracts x 100 oz per contract or 856,800 oz served upon + 879 contracts or 87,900 oz (left to be served upon) = 944,700 oz or 29.38 tonnes of gold.
We gained 4600 gold ounces standing in this June delivery month.
We now have the official USA production of gold last year and it registered 230 tonnes. Thus approximately 19.16 tonnes of gold is produced by all mines in the USA per month. Thus the amount standing for gold this month represents 153.34% of that total production.
Ladies and Gentlemen: we have a three-fold problem:
i) the total dealer inventory of gold is at a very dangerously low level of only 44.47 tonnes and none of the 9.5 tonnes delivery notices from May and the 29.38 tonnes from June have been removed from inventory as of yet.
ii) a) JPMorgan's customer inventory remains at an extremely low 141,197.86 oz.
If you are a customer of JPMorgan and have your gold in its vault, I think it is best to remove it before we have another fiasco like MFGlobal.
ii b) JPMorgan's dealer account rests tonight at 408,709.03 oz. However all of this gold has been spoken for plus an additional 85,890. oz of deficient gold.
iii) the 3 major bullion banks have collectively only 29.98 tonnes of gold left!!
end
now let us head over and see what is new with silver:
now let us head over and see what is new with silver:
Silver:
June 21.2013: June silver contract month:
| Silver |
Ounces
|
| Withdrawals from Dealers Inventory | nil |
| Withdrawals from Customer Inventory | 339,724.48 oz ( Brinks,Delaware,) |
| Deposits to the Dealer Inventory | nil |
| Deposits to the Customer Inventory | 5,247.40 (CNT) |
| No of oz served (contracts) | 1 (5,000 oz) |
| No of oz to be served (notices) | 24 (120,000 oz) |
| Total monthly oz silver served (contracts) | 117 (585,000 oz) |
| Total accumulative withdrawal of silver from the Dealers inventory this month | 988,092.07 oz |
| Total accumulative withdrawal of silver from the Customer inventory this month | 4,398,468.5 oz |
Today, we had fair activity inside the silver vaults.
we had 0 dealer deposits and 0 dealer withdrawals.
We had 1 customer deposit:
i) Into CNT: 5247.40 oz
total customer deposits 5247.40 oz
We had 2 customer withdrawals:
We had 1 customer deposit:
i) Into CNT: 5247.40 oz
total customer deposits 5247.40 oz
We had 2 customer withdrawals:
i) Out of Brinks: 40,656.810 oz
ii) Out of Delaware: 299,067.67 oz
total customer withdrawal : 339,724.48 oz
ii) Out of Delaware: 299,067.67 oz
total customer withdrawal : 339,724.48 oz
we had 3 adjustments today
i) Out of Brinks: 4844.70 oz was adjusted out of the dealer and into the customer at Brinks.
ii) and this bothers me greatly:
exactly 20,000.0000 oz was adjusted out of the dealer Delaware account and this landed into a customer account.
iii) 380,737.18 oz was adjusted out of the dealer jPMorgan and this landed into the customer account.
they were busy on Friday.
i) Out of Brinks: 4844.70 oz was adjusted out of the dealer and into the customer at Brinks.
ii) and this bothers me greatly:
exactly 20,000.0000 oz was adjusted out of the dealer Delaware account and this landed into a customer account.
iii) 380,737.18 oz was adjusted out of the dealer jPMorgan and this landed into the customer account.
they were busy on Friday.
Registered silver at : 41.397 million oz
total of all silver: 163.984 million oz.
The CME reported that we had 1 notice filed for 5,000 oz today. In order to calculate what we believe will stand in the month of June, I take the Oi standing for June (25) and subtract out Friday's notices (1) which leaves us with 24 notices or 120,000 oz.
Thus the total number of silver ounces standing in this non active delivery month of June is as follows:
117 contracts x 5000 oz per contract (served) = 585,000 oz + 24 contracts x 5000 oz or 120,000 oz left to be served upon = 705,000 oz
we neither gained nor lost any silver ounces standing today.
Thus the total number of silver ounces standing in this non active delivery month of June is as follows:
117 contracts x 5000 oz per contract (served) = 585,000 oz + 24 contracts x 5000 oz or 120,000 oz left to be served upon = 705,000 oz
we neither gained nor lost any silver ounces standing today.
Now let us check on gold inventories at the GLD first: 5.41 tons leave GLD's inventory Friday .....
June 21/2013:
June 20.2013
June 21/2013:
Tonnes989.94
Ounces31,827,598.71
Value US$41.210 billion
June 20.2013
Tonnes995.35
Ounces32,001,564.66
Value US$41.348 billion
At 3:30 pm Friday, we receive the COT report which shows position levels of our major players.
First let us head over to the gold COT:
Gold COT Report - Futures
| ||||||
Large Speculators
|
Commercial
|
Total
| ||||
Long
|
Short
|
Spreading
|
Long
|
Short
|
Long
|
Short
|
166,771
|
123,079
|
17,807
|
155,303
|
199,418
|
339,881
|
340,304
|
Change from Prior Reporting Period
| ||||||
-7,244
|
8,069
|
241
|
8,833
|
-5,374
|
1,830
|
2,936
|
Traders
| ||||||
116
|
94
|
67
|
57
|
59
|
207
|
188
|
Small Speculators
| ||||||
Long
|
Short
|
Open Interest
| ||||
37,225
|
36,802
|
377,106
| ||||
1,432
|
326
|
3,262
| ||||
non reportable positions
|
Change from the previous reporting period
| |||||
COT Gold Report - Positions as of
|
Tuesday, June 18, 2013
| |||||
Wow!!
Our large speculators:
Those large speculators that have been short for the past 6 months continued to pile onto their short side to the tune of a gigantic 8069 contracts.
Our commercials:
Those commercials that have been long in gold added a huge 8833 contracts to their long side
Those commercials that have been short in gold covered another 5374 contracts from their short side.
Our small specs:
Those small specs that have been long in gold added 1432 contracts to their long side in contrast to the large specs who pitched.
Those small specs that have been short in gold added 326 contracts to their short side.
Conclusion:
If a sting is on, the large specs will be annihilated. I believe that something big is happening.
The commercials went net long again by 14,207 contracts.
and now our Silver COT: rather comatose. It certainly looks like the longs are quite complacent.
Silver COT Report: Futures
| |||||
Large Speculators
|
Commercial
| ||||
Long
|
Short
|
Spreading
|
Long
|
Short
| |
35,474
|
31,570
|
26,937
|
68,245
|
74,197
| |
-35
|
-236
|
2,965
|
-193
|
739
| |
Traders
| |||||
65
|
51
|
48
|
43
|
37
| |
Small Speculators
|
Open Interest
|
Total
| |||
Long
|
Short
|
149,891
|
Long
|
Short
| |
19,235
|
17,187
|
130,656
|
132,704
| ||
-21
|
-752
|
2,716
|
2,737
|
3,468
| |
non reportable positions
|
Positions as of:
|
133
|
117
| ||
Tuesday, June 18, 2013
|
© SilverSeek.com
| ||||
Those large specs that have been long in silver only pitched 35 contracts from their long side.
Those large specs that have been short in silver, covered only 236 contracts from their short side.
Our commercials;
Those commercials that have been long in silver pitched a smallish 193 contracts from their long side
Those commercials that have been short in silver surprisingly added 739 contracts to their short side.
Our small specs;
Those small specs that have been long in silver pitched a very tiny 21 contracts from their long side.
Those small specs that have been short in silver covered 752 contracts from their short side.
Conclusion:
the commercials went net short for the first time in many weeks by only 546 contracts. So you have to say it is a little bearish.
* * *
Selected news and views ....
It is all just paper states Keith Barron to Eric King of Kingworld news
(Kingworldnews/Eric King/KeithBarron)
It is all just paper states Keith Barron to Eric King of Kingworld news
(Kingworldnews/Eric King/KeithBarron)
(Kingworldnews/Eric King/KeithBarron)
It's all just paper for market manipulation, Barron tells King World News
Submitted by cpowell on Fri, 2013-06-21 04:00. Section: Daily Dispatches
11:57p ET Thursday, June 20, 2013
Dear Friend of GATA and Gold:
Mining entrepreneur Keith Barron tells King World News tonight that the smashing of gold markets continues to be largely a matter of paper -- futures, options, and derivatives -- not real metal, for market manipulation. An excerpt from the interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Russia adds another 200,000 oz of physical gold into its official reserves
(courtesy Ed Steer commentary)
Since yesterday was the 20th of the month...and it fell on a week day...The Central Bank of the Russian Federation updated their website...including their new gold reserve numbers. It was fourth month in a row that they added 200,000 troy ounces. Their reserves, at least the ones they admit to, now total 32.0 million troy ounces. Nick Laird's most excellent chart is posted below.
(Click on image to enlarge
Andew Maguire checked with his people and found astronomical purchases of physical metal with the smashdown. The world knows that the gold is trading at the marginal cost to produce and thus all sovereigns put their bids in for physical gold at the LBMA.
a must read...
(courtesy Eric King/Kingworldnews/Andrew Maguire)
Central banks scooping up bargain gold, Maguire tells King World News
Submitted by cpowell on Fri, 2013-06-21 18:02. Section: Daily Dispatches
2p ET Friday, June 21, 2013
Dear Friend of GATA and Gold:
London metals trader Andrew Maguire tells King World News today that the new gold price smash has stimulated enormous buying, much by central banks, in part because gold is now priced below the cost of production. Maguire poses the zillion-dollar question: "Just how long can this paper market selling continue to drive price when such a massive transfer of physical is underway?"
An excerpt from the interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Another must read: a conversation between Dr Craig Roberts and Eric King on the smashdown of gold:
(courtesy Eric King/Kingworldnews/Dr Craig Roberts)
Fed may recapitalize banks with inside info about metals smash, Roberts says
Submitted by cpowell on Sat, 2013-06-22 01:27. Section: Daily Dispatches
9:24p ET Friday, June 21, 2013
Dear Friend of GATA and Gold:
The Federal Reserve orchestrated this week's fall in gold and silver prices and may be recapitalizing investment banks by feeding them inside information and letting them trade on it, former Assistant U.S. Treasury Secretary Paul Craig Roberts tells King World News tonight. The overwhelming selling when the markets are illiquid is the giveaway that the operation aims to drive metals prices down, Roberts says. An excerpt from his interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
This is what happens when you drive a price down below its marginal cost to produce:
(courtesy Yahoo news/GATA)
With gold and silver prices driven down, Golden Minerals suspends production
Submitted by cpowell on Fri, 2013-06-21 21:22. Section: Daily Dispatches
Golden Minerals Announces Suspension of Production
Company Press Release
via Yahoo News and PRNewsire
Friday, June 21, 2013
GOLDEN, Colorado -- Golden Minerals Co. announced that it has suspended operations at its Velardena mine as of June 21, 2013, in order to conserve the asset until operating plans and prices for silver and gold indicate a sustainable cash margin for operations.
The employees at the Velardena mine were informed of the company's decision in the afternoon of June 21, 2013.
In February 2013 the company anticipated the Velardena operations would achieve operating cash neutrality during the third quarter 2013, assuming gold and silver prices of $1,600 per ounce and $30 per ounce, respectively. In May 2013 the company projected a $5 million negative margin from the operations for the remaining three quarters of 2013 at prices of $1,500 gold and $25 silver. Metals prices have continued to decline and remain below these levels.
The company is placing the mine and processing plants on a care and maintenance program to enable a re-start when operating plans and metals prices support a cash positive outlook for the property.
Approximately 470 positions at the Velardena operations are being eliminated as a result of the suspension.
The company is negotiating the specific terms of a severance package with its labor unions. The company plans to retain a core group of approximately 50 to 60 employees to facilitate a re-start of operations and to maintain and safeguard the longer term value of the asset.
For the complete statement:
And now confidence between Eurozone banks is gone!!
(courtesy Pivotfarm)
Eurozone Banks: Confidence Gone!
Submitted by Pivotfarm on 06/21/2013 16:11 -0400
- Ben Bernanke
- China
- Creditors
- Crude
- Crude Oil
- European Central Bank
- European Union
- Eurozone
- Fail
- Federal Reserve
- Germany
- Greece
- Hyperinflation
- Insider Trading
- International Monetary Fund
- Iran
- Joseph Stiglitz
- Market Crash
- Milton Friedman
- NASDAQ
- Nasdaq 100
- Portugal
- United Kingdom
As if the Greeks don’t have enough to deal with right now with their country cut off from the benefits of a national television and radio station. What is it they say in the UK? Something like ‘when it rains it pours’. You might as well get your brollies out boys and girls, as this one looks like it is going to come down in torrents. You might also, with just a hint of imagery and poetic license, say that Europe has decided to pile it on with a shovel in heapfulls right now. Talk about kick a man while he is down.
Eurozone
The European Union prided itself on their motto of ‘United in Diversity’. That was chosen back in 2000, when the Euro was nothing more than a twinkle in the eye of the founding fathers. It still had two years of gestation before it would see the light of day on that historic 1st January 2002.
United in diversity, cultural diversity and ethnic origins, ideas and ways of thinking. The modern-day melting-pot-come-salad-bowl, with the French as the tangy onions and the Brits as the squashed tomatoes of the EU, with just a dash of sharp vinegar from the Germans to keep everybody smarting as it got tossed in the air. Literally, the diversity-unity conundrum did get tossed somewhere. Somewhere out of reach, it seems.
Eurozone: Diveristy
Today, the motto should be changed. It’s more like ‘Disunity with Adversity’. Now, the Eurozone banks have started refusing to lend to each other, spreading the word that confidence has ebbed yet lower in the stakes, in the wake of the bailouts that have taken place.
Data from the European Central Bank shows that interbank lending is back to what it was at the start of the Euro, when everybody had cold feet and nobody knew if Bank A was telling the truth to Bank B and if Country C was telling fibs over the state of its economy. Then, things picked up and lending went wild. But, the white lies are the worst ones to swallow. They leave a bitter taste. Insidious little baskets (of olives)! Some might say that they were right to have cold feet.
Cross-border lending between banks in the Eurozone dropped to 22.5% in April. It stood at 34.5% before the financial crisis put the dampers on all that. European banks have closed in upon themselves and gone into hiding like jack-rabbits. They are more interested and more confident in their domestic markets. Although, is that surprising?Get your own house into order before you can start helping somebody else out, right? Analysts have shown that German interbank funding fell by 11.2% compared with March 2012. That means that there has been the equivalent of €29.5 billion withdrawn from the German economy alone. Greece has suffered a loss of €18 billion being withdrawn from the banking system. Germany might be able to stand that sort of withdrawal, but the question as to whether or not Greece can is definitely not hard to answer. Portugal has had a reduction of 25%, on average.
The European Central Bank issued a statement saying that it had nothing to do with confidence or mistrust.
But, if the banks aren’t lending to each other, it means that there isn’t the money entering the economy. No money means the real economy isn’t getting its hands on the credit. Banks are wary about extending credit to other members of the EU when they look back at the bail-out that was necessary in Cyprus when one of its major banks had to close, making creditors put up with the losses incurred.
European Union Finance Ministers are meeting today in Luxemburg to discuss resolutions regarding how banks are wound up in order to create some sort of uniformity across the EU (member states do not have the same laws regarding which creditors are to be paid out in the event of a bank going bankrupt). The objective is to put the onus on the private creditors rather than making the taxpayer foot the bill. At last! If they do come to an agreement we won’t be talking of a bail-out, but a bail-in in the future.
However, those decisions might look good to the taxpayer, but they are eating away at confidence in the banking sector. Large deposit holders look like they are worrying about the fact that private creditors may not be able to bail-in the banks that fail in the future, simply because they too will be failing, crushed under the losses. Nervousness means that they might decide to withdraw deposits and nobody needs anyone to draw a picture of what will happen then.
All of this comes at the same time (remember: it never rains, but pours?) as the International Monetary Fund’s decision was announced that it will suspend payments that are aiding Greece in July if the Eurozone does not patch up the shortfall (roughly €3 billion-€4 billion) in the rescue plan (worth €172 billion). International-Monetary Fund regulations stipulate that governments must prove that they have financing that is 12 months ahead in order to receive disbursement. Funding will be interrupted (if they stick to the book) since Greece only has financing covered until this time 2014. Given the current mistrust of the finances of other economies in the Eurozone, it looks doubtful if pulling that one off is going to be an easy task.
Mistrust is viral. Once it has set in and it cankers away at the banking system, it will take a hell of a change to bring it back and make it swing the other way.
I will leave you today with another of Dr Craig Robert's gems:
(courtesy Paul Craig Roberts)
The Rational Market Myth
armageddon without nukes
Paul Craig Roberts
One of the myths of economics is that markets are rational. Theories are based on this assumption, and the belief that markets are rational fuels the argument against regulation. The market response to the Federal Reserve’s June 19 statement that it will taper off its bond purchases if its forecast comes true is unequivocal proof that markets are irrational.
The Federal Reserve’s statement that it "currently anticipates that it would be appropriate to moderate the monthly pace of purchases [of bonds] later this year" depends on a very big if. The if is the correctness of the Fed’s forecast of moderate economic growth and employment gains.
The Fed has not stopped purchasing $85 billion of bonds each month. So nothing real has changed. Indeed, there was no new information in the Fed’s statement. It has been known for some time that, according to the Fed, its bond purchases will gradually cease.
In response to this repeat of old information, the stock and bond markets sold off in a major way on June 19-20. This market response to the Fed’s statement indicates that the Fed’s forecast is unlikely to come true. Low interest rates and a high stock market are totally dependent on the liquidity that the Fed is injecting by printing $1,000 billion per year. If this liquidity is not injected, what will sustain the markets? If the markets crash and interest rates rise, how can the Fed expect recovery?
In other words, the participants in the stock and bond markets know that the markets are bubbles created by the printing press. There is no real basis for the high stock and bond prices. The prices are an artificial reality created by the printing press. Rational markets would take into account the printing press element and would price stocks and bonds at a much lower level.
Zero real interest rates mean that there are no risks. But how can there be no risk in Treasury bonds when the debt is growing faster than the economy?
Normally, high stock values mean strong profits from strong consumer income growth and retail sales. But we know that there is no growth in real median family income and real retail sales.
I suspect that the reason the Fed made the announcement, which seems to be derailing the Fed’s forecast of recovery on which the announcement depends, is to relieve pressure on the US dollar. For several years the Fed has been printing 1,000 billion new dollars each year. There is no demand for these dollars. So far these dollars have inflated stock and bond prices instead of consumer prices. But the implication for the dollar’s price or exchange value in currency markets is clear. The supply is increasing faster than the demand. If the dollar falters, the Fed would lose control. Rising import prices would soon drive domestic inflation and interest rates far higher than the Fed’s targets.
Washington has succeeded in getting Japan and the EU to print yen and euros in order to eliminate the likelihood of flight to other large currency alternatives to the dollar. Smaller countries have also had to print in order to protect their export markets. With so many countries printing money, the Fed’s statement implying that the US might stop printing makes the dollar look good, and, indeed, the dollar rose on the currency exchange markets.
Having neutralized the alternative currency threat to the dollar, the Fed and its agents, the bullion banks, the banks too big to fail, are still at work against the gold and silver threats to the dollar. Massive short selling of gold began at the beginning of April. Again on June 20 massive shorts of gold were sold at a time of day chosen to maximize the price decline. Only those who intend to drive down the price would sell in this way.
Since QE began, the Fed has deprived retirees of interest income and has forced retirees to spend down their capital in order to pay living expenses. Judging from the initial market response, the Fed’s latest policy announcement is adversely impacting bond, stock and real estate investors, and the manipulation of the bullion markets continues to wreak destruction on wealth stored in the only known safe haven.
How can a recovery happen when the Fed is destroying wealth?
The Fed’s irrational behavior could be seen as rational if the assumption is that the Fed’s intent is not to save the economy but to save the banks. As the Fed is committed to saving the banks "too big to fail," it is likely that the banks know of the Fed’s announcements in advance. With inside information, the banks know precisely when to short the stock, bond, and bullion markets. The banks make billions from the inside information. The billions made help to restore the banks’ balance sheets.
Guy Lawson’s book, Octopus (2012), shows that front-running on the basis of inside information has always been the source of financial fortunes. In order to save the banks, the Fed now supplies the inside information.
How is this going to play out? I suspect that the recovery, although officially a weak one, does not really exist. However, thanks to statistical artifacts that understate inflation and unemployment and overstate GDP growth, the Fed and the markets think that a recovery of sorts is in process and that the unprecedented money printing by the Fed will succeed in shifting the economy into high gear.
No such thing is likely to happen. Instead, as 2013 progresses, a further downturn will become visible through the orchestrated statistics. This time the Fed will have to get the printed money past the banks and into the economy, and inflation will explode. The dollar will collapse, and import prices--as globalism has turned the US into an import-dependent economy--will turn high inflation into hyperinflation. Disruptions in food and energy deliveries will become widespread, and a depreciated currency will cease to be used as a means of exchange.
I wouldn’t bet my life on this prediction, but I think it is as likely as the Fed’s prediction of a full recovery that allows the Fed to terminate its bond purchases and money printing by June 2014.
Americans, who have been on top of the world since the late 1940s, are not prepared for the adjustments that they are likely to have to make. And neither is their government.http://www.paulcraigroberts.org/
end
Submitted by cpowell on Fri, 2013-06-21 04:00. Section: Daily Dispatches
11:57p ET Thursday, June 20, 2013
Dear Friend of GATA and Gold:
Mining entrepreneur Keith Barron tells King World News tonight that the smashing of gold markets continues to be largely a matter of paper -- futures, options, and derivatives -- not real metal, for market manipulation. An excerpt from the interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Gold Anti-Trust Action Committee Inc.
Russia adds another 200,000 oz of physical gold into its official reserves
(courtesy Ed Steer commentary)
Since yesterday was the 20th of the month...and it fell on a week day...The Central Bank of the Russian Federation updated their website...including their new gold reserve numbers. It was fourth month in a row that they added 200,000 troy ounces. Their reserves, at least the ones they admit to, now total 32.0 million troy ounces. Nick Laird's most excellent chart is posted below.
(Click on image to enlarge
Andew Maguire checked with his people and found astronomical purchases of physical metal with the smashdown. The world knows that the gold is trading at the marginal cost to produce and thus all sovereigns put their bids in for physical gold at the LBMA.
a must read...
(courtesy Eric King/Kingworldnews/Andrew Maguire)
Central banks scooping up bargain gold, Maguire tells King World News
Andew Maguire checked with his people and found astronomical purchases of physical metal with the smashdown. The world knows that the gold is trading at the marginal cost to produce and thus all sovereigns put their bids in for physical gold at the LBMA.
a must read...
(courtesy Eric King/Kingworldnews/Andrew Maguire)
Central banks scooping up bargain gold, Maguire tells King World News
Submitted by cpowell on Fri, 2013-06-21 18:02. Section: Daily Dispatches
2p ET Friday, June 21, 2013
Dear Friend of GATA and Gold:
London metals trader Andrew Maguire tells King World News today that the new gold price smash has stimulated enormous buying, much by central banks, in part because gold is now priced below the cost of production. Maguire poses the zillion-dollar question: "Just how long can this paper market selling continue to drive price when such a massive transfer of physical is underway?"
An excerpt from the interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Another must read: a conversation between Dr Craig Roberts and Eric King on the smashdown of gold:
(courtesy Eric King/Kingworldnews/Dr Craig Roberts)
Fed may recapitalize banks with inside info about metals smash, Roberts says
Submitted by cpowell on Sat, 2013-06-22 01:27. Section: Daily Dispatches
9:24p ET Friday, June 21, 2013
Dear Friend of GATA and Gold:
The Federal Reserve orchestrated this week's fall in gold and silver prices and may be recapitalizing investment banks by feeding them inside information and letting them trade on it, former Assistant U.S. Treasury Secretary Paul Craig Roberts tells King World News tonight. The overwhelming selling when the markets are illiquid is the giveaway that the operation aims to drive metals prices down, Roberts says. An excerpt from his interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
This is what happens when you drive a price down below its marginal cost to produce:
(courtesy Yahoo news/GATA)
With gold and silver prices driven down, Golden Minerals suspends production
Submitted by cpowell on Fri, 2013-06-21 21:22. Section: Daily Dispatches
Golden Minerals Announces Suspension of Production
Company Press Release
via Yahoo News and PRNewsire
Friday, June 21, 2013
GOLDEN, Colorado -- Golden Minerals Co. announced that it has suspended operations at its Velardena mine as of June 21, 2013, in order to conserve the asset until operating plans and prices for silver and gold indicate a sustainable cash margin for operations.
The employees at the Velardena mine were informed of the company's decision in the afternoon of June 21, 2013.
In February 2013 the company anticipated the Velardena operations would achieve operating cash neutrality during the third quarter 2013, assuming gold and silver prices of $1,600 per ounce and $30 per ounce, respectively. In May 2013 the company projected a $5 million negative margin from the operations for the remaining three quarters of 2013 at prices of $1,500 gold and $25 silver. Metals prices have continued to decline and remain below these levels.
The company is placing the mine and processing plants on a care and maintenance program to enable a re-start when operating plans and metals prices support a cash positive outlook for the property.
Approximately 470 positions at the Velardena operations are being eliminated as a result of the suspension.
The company is negotiating the specific terms of a severance package with its labor unions. The company plans to retain a core group of approximately 50 to 60 employees to facilitate a re-start of operations and to maintain and safeguard the longer term value of the asset.
For the complete statement:
And now confidence between Eurozone banks is gone!!
(courtesy Pivotfarm)
Eurozone Banks: Confidence Gone!
Submitted by Pivotfarm on 06/21/2013 16:11 -0400
- Ben Bernanke
- China
- Creditors
- Crude
- Crude Oil
- European Central Bank
- European Union
- Eurozone
- Fail
- Federal Reserve
- Germany
- Greece
- Hyperinflation
- Insider Trading
- International Monetary Fund
- Iran
- Joseph Stiglitz
- Market Crash
- Milton Friedman
- NASDAQ
- Nasdaq 100
- Portugal
- United Kingdom
As if the Greeks don’t have enough to deal with right now with their country cut off from the benefits of a national television and radio station. What is it they say in the UK? Something like ‘when it rains it pours’. You might as well get your brollies out boys and girls, as this one looks like it is going to come down in torrents. You might also, with just a hint of imagery and poetic license, say that Europe has decided to pile it on with a shovel in heapfulls right now. Talk about kick a man while he is down.
Eurozone
The European Union prided itself on their motto of ‘United in Diversity’. That was chosen back in 2000, when the Euro was nothing more than a twinkle in the eye of the founding fathers. It still had two years of gestation before it would see the light of day on that historic 1st January 2002.
United in diversity, cultural diversity and ethnic origins, ideas and ways of thinking. The modern-day melting-pot-come-salad-bowl, with the French as the tangy onions and the Brits as the squashed tomatoes of the EU, with just a dash of sharp vinegar from the Germans to keep everybody smarting as it got tossed in the air. Literally, the diversity-unity conundrum did get tossed somewhere. Somewhere out of reach, it seems.
Eurozone: Diveristy
Today, the motto should be changed. It’s more like ‘Disunity with Adversity’. Now, the Eurozone banks have started refusing to lend to each other, spreading the word that confidence has ebbed yet lower in the stakes, in the wake of the bailouts that have taken place.
Data from the European Central Bank shows that interbank lending is back to what it was at the start of the Euro, when everybody had cold feet and nobody knew if Bank A was telling the truth to Bank B and if Country C was telling fibs over the state of its economy. Then, things picked up and lending went wild. But, the white lies are the worst ones to swallow. They leave a bitter taste. Insidious little baskets (of olives)! Some might say that they were right to have cold feet.
Cross-border lending between banks in the Eurozone dropped to 22.5% in April. It stood at 34.5% before the financial crisis put the dampers on all that. European banks have closed in upon themselves and gone into hiding like jack-rabbits. They are more interested and more confident in their domestic markets. Although, is that surprising?Get your own house into order before you can start helping somebody else out, right? Analysts have shown that German interbank funding fell by 11.2% compared with March 2012. That means that there has been the equivalent of €29.5 billion withdrawn from the German economy alone. Greece has suffered a loss of €18 billion being withdrawn from the banking system. Germany might be able to stand that sort of withdrawal, but the question as to whether or not Greece can is definitely not hard to answer. Portugal has had a reduction of 25%, on average.
The European Central Bank issued a statement saying that it had nothing to do with confidence or mistrust.
But, if the banks aren’t lending to each other, it means that there isn’t the money entering the economy. No money means the real economy isn’t getting its hands on the credit. Banks are wary about extending credit to other members of the EU when they look back at the bail-out that was necessary in Cyprus when one of its major banks had to close, making creditors put up with the losses incurred.
European Union Finance Ministers are meeting today in Luxemburg to discuss resolutions regarding how banks are wound up in order to create some sort of uniformity across the EU (member states do not have the same laws regarding which creditors are to be paid out in the event of a bank going bankrupt). The objective is to put the onus on the private creditors rather than making the taxpayer foot the bill. At last! If they do come to an agreement we won’t be talking of a bail-out, but a bail-in in the future.
However, those decisions might look good to the taxpayer, but they are eating away at confidence in the banking sector. Large deposit holders look like they are worrying about the fact that private creditors may not be able to bail-in the banks that fail in the future, simply because they too will be failing, crushed under the losses. Nervousness means that they might decide to withdraw deposits and nobody needs anyone to draw a picture of what will happen then.
All of this comes at the same time (remember: it never rains, but pours?) as the International Monetary Fund’s decision was announced that it will suspend payments that are aiding Greece in July if the Eurozone does not patch up the shortfall (roughly €3 billion-€4 billion) in the rescue plan (worth €172 billion). International-Monetary Fund regulations stipulate that governments must prove that they have financing that is 12 months ahead in order to receive disbursement. Funding will be interrupted (if they stick to the book) since Greece only has financing covered until this time 2014. Given the current mistrust of the finances of other economies in the Eurozone, it looks doubtful if pulling that one off is going to be an easy task.
Mistrust is viral. Once it has set in and it cankers away at the banking system, it will take a hell of a change to bring it back and make it swing the other way.
I will leave you today with another of Dr Craig Robert's gems:
(courtesy Paul Craig Roberts)
The Rational Market Myth
armageddon without nukes
Paul Craig Roberts
One of the myths of economics is that markets are rational. Theories are based on this assumption, and the belief that markets are rational fuels the argument against regulation. The market response to the Federal Reserve’s June 19 statement that it will taper off its bond purchases if its forecast comes true is unequivocal proof that markets are irrational.
The Federal Reserve’s statement that it "currently anticipates that it would be appropriate to moderate the monthly pace of purchases [of bonds] later this year" depends on a very big if. The if is the correctness of the Fed’s forecast of moderate economic growth and employment gains.
The Fed has not stopped purchasing $85 billion of bonds each month. So nothing real has changed. Indeed, there was no new information in the Fed’s statement. It has been known for some time that, according to the Fed, its bond purchases will gradually cease.
In response to this repeat of old information, the stock and bond markets sold off in a major way on June 19-20. This market response to the Fed’s statement indicates that the Fed’s forecast is unlikely to come true. Low interest rates and a high stock market are totally dependent on the liquidity that the Fed is injecting by printing $1,000 billion per year. If this liquidity is not injected, what will sustain the markets? If the markets crash and interest rates rise, how can the Fed expect recovery?
In other words, the participants in the stock and bond markets know that the markets are bubbles created by the printing press. There is no real basis for the high stock and bond prices. The prices are an artificial reality created by the printing press. Rational markets would take into account the printing press element and would price stocks and bonds at a much lower level.
Zero real interest rates mean that there are no risks. But how can there be no risk in Treasury bonds when the debt is growing faster than the economy?
Normally, high stock values mean strong profits from strong consumer income growth and retail sales. But we know that there is no growth in real median family income and real retail sales.
I suspect that the reason the Fed made the announcement, which seems to be derailing the Fed’s forecast of recovery on which the announcement depends, is to relieve pressure on the US dollar. For several years the Fed has been printing 1,000 billion new dollars each year. There is no demand for these dollars. So far these dollars have inflated stock and bond prices instead of consumer prices. But the implication for the dollar’s price or exchange value in currency markets is clear. The supply is increasing faster than the demand. If the dollar falters, the Fed would lose control. Rising import prices would soon drive domestic inflation and interest rates far higher than the Fed’s targets.
Washington has succeeded in getting Japan and the EU to print yen and euros in order to eliminate the likelihood of flight to other large currency alternatives to the dollar. Smaller countries have also had to print in order to protect their export markets. With so many countries printing money, the Fed’s statement implying that the US might stop printing makes the dollar look good, and, indeed, the dollar rose on the currency exchange markets.
Having neutralized the alternative currency threat to the dollar, the Fed and its agents, the bullion banks, the banks too big to fail, are still at work against the gold and silver threats to the dollar. Massive short selling of gold began at the beginning of April. Again on June 20 massive shorts of gold were sold at a time of day chosen to maximize the price decline. Only those who intend to drive down the price would sell in this way.
Since QE began, the Fed has deprived retirees of interest income and has forced retirees to spend down their capital in order to pay living expenses. Judging from the initial market response, the Fed’s latest policy announcement is adversely impacting bond, stock and real estate investors, and the manipulation of the bullion markets continues to wreak destruction on wealth stored in the only known safe haven.
How can a recovery happen when the Fed is destroying wealth?
The Fed’s irrational behavior could be seen as rational if the assumption is that the Fed’s intent is not to save the economy but to save the banks. As the Fed is committed to saving the banks "too big to fail," it is likely that the banks know of the Fed’s announcements in advance. With inside information, the banks know precisely when to short the stock, bond, and bullion markets. The banks make billions from the inside information. The billions made help to restore the banks’ balance sheets.
Guy Lawson’s book, Octopus (2012), shows that front-running on the basis of inside information has always been the source of financial fortunes. In order to save the banks, the Fed now supplies the inside information.
How is this going to play out? I suspect that the recovery, although officially a weak one, does not really exist. However, thanks to statistical artifacts that understate inflation and unemployment and overstate GDP growth, the Fed and the markets think that a recovery of sorts is in process and that the unprecedented money printing by the Fed will succeed in shifting the economy into high gear.
No such thing is likely to happen. Instead, as 2013 progresses, a further downturn will become visible through the orchestrated statistics. This time the Fed will have to get the printed money past the banks and into the economy, and inflation will explode. The dollar will collapse, and import prices--as globalism has turned the US into an import-dependent economy--will turn high inflation into hyperinflation. Disruptions in food and energy deliveries will become widespread, and a depreciated currency will cease to be used as a means of exchange.
I wouldn’t bet my life on this prediction, but I think it is as likely as the Fed’s prediction of a full recovery that allows the Fed to terminate its bond purchases and money printing by June 2014.
Americans, who have been on top of the world since the late 1940s, are not prepared for the adjustments that they are likely to have to make. And neither is their government.http://www.paulcraigroberts.org/
end
Submitted by cpowell on Fri, 2013-06-21 18:02. Section: Daily Dispatches
2p ET Friday, June 21, 2013
Dear Friend of GATA and Gold:
London metals trader Andrew Maguire tells King World News today that the new gold price smash has stimulated enormous buying, much by central banks, in part because gold is now priced below the cost of production. Maguire poses the zillion-dollar question: "Just how long can this paper market selling continue to drive price when such a massive transfer of physical is underway?"
An excerpt from the interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Gold Anti-Trust Action Committee Inc.
Another must read: a conversation between Dr Craig Roberts and Eric King on the smashdown of gold:
(courtesy Eric King/Kingworldnews/Dr Craig Roberts)
Another must read: a conversation between Dr Craig Roberts and Eric King on the smashdown of gold:
(courtesy Eric King/Kingworldnews/Dr Craig Roberts)
(courtesy Eric King/Kingworldnews/Dr Craig Roberts)
Fed may recapitalize banks with inside info about metals smash, Roberts says
Submitted by cpowell on Sat, 2013-06-22 01:27. Section: Daily Dispatches
9:24p ET Friday, June 21, 2013
Dear Friend of GATA and Gold:
The Federal Reserve orchestrated this week's fall in gold and silver prices and may be recapitalizing investment banks by feeding them inside information and letting them trade on it, former Assistant U.S. Treasury Secretary Paul Craig Roberts tells King World News tonight. The overwhelming selling when the markets are illiquid is the giveaway that the operation aims to drive metals prices down, Roberts says. An excerpt from his interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
This is what happens when you drive a price down below its marginal cost to produce:
(courtesy Yahoo news/GATA)
With gold and silver prices driven down, Golden Minerals suspends production
Submitted by cpowell on Fri, 2013-06-21 21:22. Section: Daily Dispatches
Golden Minerals Announces Suspension of Production
Company Press Release
via Yahoo News and PRNewsire
Friday, June 21, 2013
GOLDEN, Colorado -- Golden Minerals Co. announced that it has suspended operations at its Velardena mine as of June 21, 2013, in order to conserve the asset until operating plans and prices for silver and gold indicate a sustainable cash margin for operations.
The employees at the Velardena mine were informed of the company's decision in the afternoon of June 21, 2013.
In February 2013 the company anticipated the Velardena operations would achieve operating cash neutrality during the third quarter 2013, assuming gold and silver prices of $1,600 per ounce and $30 per ounce, respectively. In May 2013 the company projected a $5 million negative margin from the operations for the remaining three quarters of 2013 at prices of $1,500 gold and $25 silver. Metals prices have continued to decline and remain below these levels.
The company is placing the mine and processing plants on a care and maintenance program to enable a re-start when operating plans and metals prices support a cash positive outlook for the property.
Approximately 470 positions at the Velardena operations are being eliminated as a result of the suspension.
The company is negotiating the specific terms of a severance package with its labor unions. The company plans to retain a core group of approximately 50 to 60 employees to facilitate a re-start of operations and to maintain and safeguard the longer term value of the asset.
For the complete statement:
And now confidence between Eurozone banks is gone!!
(courtesy Pivotfarm)
Eurozone Banks: Confidence Gone!
Submitted by Pivotfarm on 06/21/2013 16:11 -0400
- Ben Bernanke
- China
- Creditors
- Crude
- Crude Oil
- European Central Bank
- European Union
- Eurozone
- Fail
- Federal Reserve
- Germany
- Greece
- Hyperinflation
- Insider Trading
- International Monetary Fund
- Iran
- Joseph Stiglitz
- Market Crash
- Milton Friedman
- NASDAQ
- Nasdaq 100
- Portugal
- United Kingdom
As if the Greeks don’t have enough to deal with right now with their country cut off from the benefits of a national television and radio station. What is it they say in the UK? Something like ‘when it rains it pours’. You might as well get your brollies out boys and girls, as this one looks like it is going to come down in torrents. You might also, with just a hint of imagery and poetic license, say that Europe has decided to pile it on with a shovel in heapfulls right now. Talk about kick a man while he is down.
Eurozone
The European Union prided itself on their motto of ‘United in Diversity’. That was chosen back in 2000, when the Euro was nothing more than a twinkle in the eye of the founding fathers. It still had two years of gestation before it would see the light of day on that historic 1st January 2002.
United in diversity, cultural diversity and ethnic origins, ideas and ways of thinking. The modern-day melting-pot-come-salad-bowl, with the French as the tangy onions and the Brits as the squashed tomatoes of the EU, with just a dash of sharp vinegar from the Germans to keep everybody smarting as it got tossed in the air. Literally, the diversity-unity conundrum did get tossed somewhere. Somewhere out of reach, it seems.
Eurozone: Diveristy
Today, the motto should be changed. It’s more like ‘Disunity with Adversity’. Now, the Eurozone banks have started refusing to lend to each other, spreading the word that confidence has ebbed yet lower in the stakes, in the wake of the bailouts that have taken place.
Data from the European Central Bank shows that interbank lending is back to what it was at the start of the Euro, when everybody had cold feet and nobody knew if Bank A was telling the truth to Bank B and if Country C was telling fibs over the state of its economy. Then, things picked up and lending went wild. But, the white lies are the worst ones to swallow. They leave a bitter taste. Insidious little baskets (of olives)! Some might say that they were right to have cold feet.
Cross-border lending between banks in the Eurozone dropped to 22.5% in April. It stood at 34.5% before the financial crisis put the dampers on all that. European banks have closed in upon themselves and gone into hiding like jack-rabbits. They are more interested and more confident in their domestic markets. Although, is that surprising?Get your own house into order before you can start helping somebody else out, right? Analysts have shown that German interbank funding fell by 11.2% compared with March 2012. That means that there has been the equivalent of €29.5 billion withdrawn from the German economy alone. Greece has suffered a loss of €18 billion being withdrawn from the banking system. Germany might be able to stand that sort of withdrawal, but the question as to whether or not Greece can is definitely not hard to answer. Portugal has had a reduction of 25%, on average.
The European Central Bank issued a statement saying that it had nothing to do with confidence or mistrust.
But, if the banks aren’t lending to each other, it means that there isn’t the money entering the economy. No money means the real economy isn’t getting its hands on the credit. Banks are wary about extending credit to other members of the EU when they look back at the bail-out that was necessary in Cyprus when one of its major banks had to close, making creditors put up with the losses incurred.
European Union Finance Ministers are meeting today in Luxemburg to discuss resolutions regarding how banks are wound up in order to create some sort of uniformity across the EU (member states do not have the same laws regarding which creditors are to be paid out in the event of a bank going bankrupt). The objective is to put the onus on the private creditors rather than making the taxpayer foot the bill. At last! If they do come to an agreement we won’t be talking of a bail-out, but a bail-in in the future.
However, those decisions might look good to the taxpayer, but they are eating away at confidence in the banking sector. Large deposit holders look like they are worrying about the fact that private creditors may not be able to bail-in the banks that fail in the future, simply because they too will be failing, crushed under the losses. Nervousness means that they might decide to withdraw deposits and nobody needs anyone to draw a picture of what will happen then.
All of this comes at the same time (remember: it never rains, but pours?) as the International Monetary Fund’s decision was announced that it will suspend payments that are aiding Greece in July if the Eurozone does not patch up the shortfall (roughly €3 billion-€4 billion) in the rescue plan (worth €172 billion). International-Monetary Fund regulations stipulate that governments must prove that they have financing that is 12 months ahead in order to receive disbursement. Funding will be interrupted (if they stick to the book) since Greece only has financing covered until this time 2014. Given the current mistrust of the finances of other economies in the Eurozone, it looks doubtful if pulling that one off is going to be an easy task.
Mistrust is viral. Once it has set in and it cankers away at the banking system, it will take a hell of a change to bring it back and make it swing the other way.
I will leave you today with another of Dr Craig Robert's gems:
(courtesy Paul Craig Roberts)
The Rational Market Myth
armageddon without nukes
Paul Craig Roberts
One of the myths of economics is that markets are rational. Theories are based on this assumption, and the belief that markets are rational fuels the argument against regulation. The market response to the Federal Reserve’s June 19 statement that it will taper off its bond purchases if its forecast comes true is unequivocal proof that markets are irrational.
The Federal Reserve’s statement that it "currently anticipates that it would be appropriate to moderate the monthly pace of purchases [of bonds] later this year" depends on a very big if. The if is the correctness of the Fed’s forecast of moderate economic growth and employment gains.
The Fed has not stopped purchasing $85 billion of bonds each month. So nothing real has changed. Indeed, there was no new information in the Fed’s statement. It has been known for some time that, according to the Fed, its bond purchases will gradually cease.
In response to this repeat of old information, the stock and bond markets sold off in a major way on June 19-20. This market response to the Fed’s statement indicates that the Fed’s forecast is unlikely to come true. Low interest rates and a high stock market are totally dependent on the liquidity that the Fed is injecting by printing $1,000 billion per year. If this liquidity is not injected, what will sustain the markets? If the markets crash and interest rates rise, how can the Fed expect recovery?
In other words, the participants in the stock and bond markets know that the markets are bubbles created by the printing press. There is no real basis for the high stock and bond prices. The prices are an artificial reality created by the printing press. Rational markets would take into account the printing press element and would price stocks and bonds at a much lower level.
Zero real interest rates mean that there are no risks. But how can there be no risk in Treasury bonds when the debt is growing faster than the economy?
Normally, high stock values mean strong profits from strong consumer income growth and retail sales. But we know that there is no growth in real median family income and real retail sales.
I suspect that the reason the Fed made the announcement, which seems to be derailing the Fed’s forecast of recovery on which the announcement depends, is to relieve pressure on the US dollar. For several years the Fed has been printing 1,000 billion new dollars each year. There is no demand for these dollars. So far these dollars have inflated stock and bond prices instead of consumer prices. But the implication for the dollar’s price or exchange value in currency markets is clear. The supply is increasing faster than the demand. If the dollar falters, the Fed would lose control. Rising import prices would soon drive domestic inflation and interest rates far higher than the Fed’s targets.
Washington has succeeded in getting Japan and the EU to print yen and euros in order to eliminate the likelihood of flight to other large currency alternatives to the dollar. Smaller countries have also had to print in order to protect their export markets. With so many countries printing money, the Fed’s statement implying that the US might stop printing makes the dollar look good, and, indeed, the dollar rose on the currency exchange markets.
Having neutralized the alternative currency threat to the dollar, the Fed and its agents, the bullion banks, the banks too big to fail, are still at work against the gold and silver threats to the dollar. Massive short selling of gold began at the beginning of April. Again on June 20 massive shorts of gold were sold at a time of day chosen to maximize the price decline. Only those who intend to drive down the price would sell in this way.
Since QE began, the Fed has deprived retirees of interest income and has forced retirees to spend down their capital in order to pay living expenses. Judging from the initial market response, the Fed’s latest policy announcement is adversely impacting bond, stock and real estate investors, and the manipulation of the bullion markets continues to wreak destruction on wealth stored in the only known safe haven.
How can a recovery happen when the Fed is destroying wealth?
The Fed’s irrational behavior could be seen as rational if the assumption is that the Fed’s intent is not to save the economy but to save the banks. As the Fed is committed to saving the banks "too big to fail," it is likely that the banks know of the Fed’s announcements in advance. With inside information, the banks know precisely when to short the stock, bond, and bullion markets. The banks make billions from the inside information. The billions made help to restore the banks’ balance sheets.
Guy Lawson’s book, Octopus (2012), shows that front-running on the basis of inside information has always been the source of financial fortunes. In order to save the banks, the Fed now supplies the inside information.
How is this going to play out? I suspect that the recovery, although officially a weak one, does not really exist. However, thanks to statistical artifacts that understate inflation and unemployment and overstate GDP growth, the Fed and the markets think that a recovery of sorts is in process and that the unprecedented money printing by the Fed will succeed in shifting the economy into high gear.
No such thing is likely to happen. Instead, as 2013 progresses, a further downturn will become visible through the orchestrated statistics. This time the Fed will have to get the printed money past the banks and into the economy, and inflation will explode. The dollar will collapse, and import prices--as globalism has turned the US into an import-dependent economy--will turn high inflation into hyperinflation. Disruptions in food and energy deliveries will become widespread, and a depreciated currency will cease to be used as a means of exchange.
I wouldn’t bet my life on this prediction, but I think it is as likely as the Fed’s prediction of a full recovery that allows the Fed to terminate its bond purchases and money printing by June 2014.
Americans, who have been on top of the world since the late 1940s, are not prepared for the adjustments that they are likely to have to make. And neither is their government.http://www.paulcraigroberts.org/
end
Submitted by cpowell on Sat, 2013-06-22 01:27. Section: Daily Dispatches
9:24p ET Friday, June 21, 2013
Dear Friend of GATA and Gold:
The Federal Reserve orchestrated this week's fall in gold and silver prices and may be recapitalizing investment banks by feeding them inside information and letting them trade on it, former Assistant U.S. Treasury Secretary Paul Craig Roberts tells King World News tonight. The overwhelming selling when the markets are illiquid is the giveaway that the operation aims to drive metals prices down, Roberts says. An excerpt from his interview is posted at the King World News blog here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Gold Anti-Trust Action Committee Inc.
This is what happens when you drive a price down below its marginal cost to produce:
(courtesy Yahoo news/GATA)
This is what happens when you drive a price down below its marginal cost to produce:
(courtesy Yahoo news/GATA)
With gold and silver prices driven down, Golden Minerals suspends production
Submitted by cpowell on Fri, 2013-06-21 21:22. Section: Daily Dispatches
Golden Minerals Announces Suspension of Production
Company Press Release
via Yahoo News and PRNewsire
Friday, June 21, 2013
GOLDEN, Colorado -- Golden Minerals Co. announced that it has suspended operations at its Velardena mine as of June 21, 2013, in order to conserve the asset until operating plans and prices for silver and gold indicate a sustainable cash margin for operations.
The employees at the Velardena mine were informed of the company's decision in the afternoon of June 21, 2013.
In February 2013 the company anticipated the Velardena operations would achieve operating cash neutrality during the third quarter 2013, assuming gold and silver prices of $1,600 per ounce and $30 per ounce, respectively. In May 2013 the company projected a $5 million negative margin from the operations for the remaining three quarters of 2013 at prices of $1,500 gold and $25 silver. Metals prices have continued to decline and remain below these levels.
The company is placing the mine and processing plants on a care and maintenance program to enable a re-start when operating plans and metals prices support a cash positive outlook for the property.
Approximately 470 positions at the Velardena operations are being eliminated as a result of the suspension.
The company is negotiating the specific terms of a severance package with its labor unions. The company plans to retain a core group of approximately 50 to 60 employees to facilitate a re-start of operations and to maintain and safeguard the longer term value of the asset.
For the complete statement:
And now confidence between Eurozone banks is gone!!
(courtesy Pivotfarm)
Eurozone Banks: Confidence Gone!
Submitted by Pivotfarm on 06/21/2013 16:11 -0400
- Ben Bernanke
- China
- Creditors
- Crude
- Crude Oil
- European Central Bank
- European Union
- Eurozone
- Fail
- Federal Reserve
- Germany
- Greece
- Hyperinflation
- Insider Trading
- International Monetary Fund
- Iran
- Joseph Stiglitz
- Market Crash
- Milton Friedman
- NASDAQ
- Nasdaq 100
- Portugal
- United Kingdom
As if the Greeks don’t have enough to deal with right now with their country cut off from the benefits of a national television and radio station. What is it they say in the UK? Something like ‘when it rains it pours’. You might as well get your brollies out boys and girls, as this one looks like it is going to come down in torrents. You might also, with just a hint of imagery and poetic license, say that Europe has decided to pile it on with a shovel in heapfulls right now. Talk about kick a man while he is down.
Eurozone
The European Union prided itself on their motto of ‘United in Diversity’. That was chosen back in 2000, when the Euro was nothing more than a twinkle in the eye of the founding fathers. It still had two years of gestation before it would see the light of day on that historic 1st January 2002.
United in diversity, cultural diversity and ethnic origins, ideas and ways of thinking. The modern-day melting-pot-come-salad-bowl, with the French as the tangy onions and the Brits as the squashed tomatoes of the EU, with just a dash of sharp vinegar from the Germans to keep everybody smarting as it got tossed in the air. Literally, the diversity-unity conundrum did get tossed somewhere. Somewhere out of reach, it seems.
Eurozone: Diveristy
Today, the motto should be changed. It’s more like ‘Disunity with Adversity’. Now, the Eurozone banks have started refusing to lend to each other, spreading the word that confidence has ebbed yet lower in the stakes, in the wake of the bailouts that have taken place.
Data from the European Central Bank shows that interbank lending is back to what it was at the start of the Euro, when everybody had cold feet and nobody knew if Bank A was telling the truth to Bank B and if Country C was telling fibs over the state of its economy. Then, things picked up and lending went wild. But, the white lies are the worst ones to swallow. They leave a bitter taste. Insidious little baskets (of olives)! Some might say that they were right to have cold feet.
Cross-border lending between banks in the Eurozone dropped to 22.5% in April. It stood at 34.5% before the financial crisis put the dampers on all that. European banks have closed in upon themselves and gone into hiding like jack-rabbits. They are more interested and more confident in their domestic markets. Although, is that surprising?Get your own house into order before you can start helping somebody else out, right? Analysts have shown that German interbank funding fell by 11.2% compared with March 2012. That means that there has been the equivalent of €29.5 billion withdrawn from the German economy alone. Greece has suffered a loss of €18 billion being withdrawn from the banking system. Germany might be able to stand that sort of withdrawal, but the question as to whether or not Greece can is definitely not hard to answer. Portugal has had a reduction of 25%, on average.
The European Central Bank issued a statement saying that it had nothing to do with confidence or mistrust.
But, if the banks aren’t lending to each other, it means that there isn’t the money entering the economy. No money means the real economy isn’t getting its hands on the credit. Banks are wary about extending credit to other members of the EU when they look back at the bail-out that was necessary in Cyprus when one of its major banks had to close, making creditors put up with the losses incurred.
European Union Finance Ministers are meeting today in Luxemburg to discuss resolutions regarding how banks are wound up in order to create some sort of uniformity across the EU (member states do not have the same laws regarding which creditors are to be paid out in the event of a bank going bankrupt). The objective is to put the onus on the private creditors rather than making the taxpayer foot the bill. At last! If they do come to an agreement we won’t be talking of a bail-out, but a bail-in in the future.
However, those decisions might look good to the taxpayer, but they are eating away at confidence in the banking sector. Large deposit holders look like they are worrying about the fact that private creditors may not be able to bail-in the banks that fail in the future, simply because they too will be failing, crushed under the losses. Nervousness means that they might decide to withdraw deposits and nobody needs anyone to draw a picture of what will happen then.
All of this comes at the same time (remember: it never rains, but pours?) as the International Monetary Fund’s decision was announced that it will suspend payments that are aiding Greece in July if the Eurozone does not patch up the shortfall (roughly €3 billion-€4 billion) in the rescue plan (worth €172 billion). International-Monetary Fund regulations stipulate that governments must prove that they have financing that is 12 months ahead in order to receive disbursement. Funding will be interrupted (if they stick to the book) since Greece only has financing covered until this time 2014. Given the current mistrust of the finances of other economies in the Eurozone, it looks doubtful if pulling that one off is going to be an easy task.
Mistrust is viral. Once it has set in and it cankers away at the banking system, it will take a hell of a change to bring it back and make it swing the other way.
I will leave you today with another of Dr Craig Robert's gems:
(courtesy Paul Craig Roberts)
The Rational Market Myth
armageddon without nukes
Paul Craig Roberts
One of the myths of economics is that markets are rational. Theories are based on this assumption, and the belief that markets are rational fuels the argument against regulation. The market response to the Federal Reserve’s June 19 statement that it will taper off its bond purchases if its forecast comes true is unequivocal proof that markets are irrational.
The Federal Reserve’s statement that it "currently anticipates that it would be appropriate to moderate the monthly pace of purchases [of bonds] later this year" depends on a very big if. The if is the correctness of the Fed’s forecast of moderate economic growth and employment gains.
The Fed has not stopped purchasing $85 billion of bonds each month. So nothing real has changed. Indeed, there was no new information in the Fed’s statement. It has been known for some time that, according to the Fed, its bond purchases will gradually cease.
In response to this repeat of old information, the stock and bond markets sold off in a major way on June 19-20. This market response to the Fed’s statement indicates that the Fed’s forecast is unlikely to come true. Low interest rates and a high stock market are totally dependent on the liquidity that the Fed is injecting by printing $1,000 billion per year. If this liquidity is not injected, what will sustain the markets? If the markets crash and interest rates rise, how can the Fed expect recovery?
In other words, the participants in the stock and bond markets know that the markets are bubbles created by the printing press. There is no real basis for the high stock and bond prices. The prices are an artificial reality created by the printing press. Rational markets would take into account the printing press element and would price stocks and bonds at a much lower level.
Zero real interest rates mean that there are no risks. But how can there be no risk in Treasury bonds when the debt is growing faster than the economy?
Normally, high stock values mean strong profits from strong consumer income growth and retail sales. But we know that there is no growth in real median family income and real retail sales.
I suspect that the reason the Fed made the announcement, which seems to be derailing the Fed’s forecast of recovery on which the announcement depends, is to relieve pressure on the US dollar. For several years the Fed has been printing 1,000 billion new dollars each year. There is no demand for these dollars. So far these dollars have inflated stock and bond prices instead of consumer prices. But the implication for the dollar’s price or exchange value in currency markets is clear. The supply is increasing faster than the demand. If the dollar falters, the Fed would lose control. Rising import prices would soon drive domestic inflation and interest rates far higher than the Fed’s targets.
Washington has succeeded in getting Japan and the EU to print yen and euros in order to eliminate the likelihood of flight to other large currency alternatives to the dollar. Smaller countries have also had to print in order to protect their export markets. With so many countries printing money, the Fed’s statement implying that the US might stop printing makes the dollar look good, and, indeed, the dollar rose on the currency exchange markets.
Having neutralized the alternative currency threat to the dollar, the Fed and its agents, the bullion banks, the banks too big to fail, are still at work against the gold and silver threats to the dollar. Massive short selling of gold began at the beginning of April. Again on June 20 massive shorts of gold were sold at a time of day chosen to maximize the price decline. Only those who intend to drive down the price would sell in this way.
Since QE began, the Fed has deprived retirees of interest income and has forced retirees to spend down their capital in order to pay living expenses. Judging from the initial market response, the Fed’s latest policy announcement is adversely impacting bond, stock and real estate investors, and the manipulation of the bullion markets continues to wreak destruction on wealth stored in the only known safe haven.
How can a recovery happen when the Fed is destroying wealth?
The Fed’s irrational behavior could be seen as rational if the assumption is that the Fed’s intent is not to save the economy but to save the banks. As the Fed is committed to saving the banks "too big to fail," it is likely that the banks know of the Fed’s announcements in advance. With inside information, the banks know precisely when to short the stock, bond, and bullion markets. The banks make billions from the inside information. The billions made help to restore the banks’ balance sheets.
Guy Lawson’s book, Octopus (2012), shows that front-running on the basis of inside information has always been the source of financial fortunes. In order to save the banks, the Fed now supplies the inside information.
How is this going to play out? I suspect that the recovery, although officially a weak one, does not really exist. However, thanks to statistical artifacts that understate inflation and unemployment and overstate GDP growth, the Fed and the markets think that a recovery of sorts is in process and that the unprecedented money printing by the Fed will succeed in shifting the economy into high gear.
No such thing is likely to happen. Instead, as 2013 progresses, a further downturn will become visible through the orchestrated statistics. This time the Fed will have to get the printed money past the banks and into the economy, and inflation will explode. The dollar will collapse, and import prices--as globalism has turned the US into an import-dependent economy--will turn high inflation into hyperinflation. Disruptions in food and energy deliveries will become widespread, and a depreciated currency will cease to be used as a means of exchange.
I wouldn’t bet my life on this prediction, but I think it is as likely as the Fed’s prediction of a full recovery that allows the Fed to terminate its bond purchases and money printing by June 2014.
Americans, who have been on top of the world since the late 1940s, are not prepared for the adjustments that they are likely to have to make. And neither is their government.http://www.paulcraigroberts.org/
end
Submitted by cpowell on Fri, 2013-06-21 21:22. Section: Daily Dispatches
Golden Minerals Announces Suspension of Production
Company Press Release
via Yahoo News and PRNewsire
Friday, June 21, 2013
via Yahoo News and PRNewsire
Friday, June 21, 2013
GOLDEN, Colorado -- Golden Minerals Co. announced that it has suspended operations at its Velardena mine as of June 21, 2013, in order to conserve the asset until operating plans and prices for silver and gold indicate a sustainable cash margin for operations.
The employees at the Velardena mine were informed of the company's decision in the afternoon of June 21, 2013.
In February 2013 the company anticipated the Velardena operations would achieve operating cash neutrality during the third quarter 2013, assuming gold and silver prices of $1,600 per ounce and $30 per ounce, respectively. In May 2013 the company projected a $5 million negative margin from the operations for the remaining three quarters of 2013 at prices of $1,500 gold and $25 silver. Metals prices have continued to decline and remain below these levels.
The company is placing the mine and processing plants on a care and maintenance program to enable a re-start when operating plans and metals prices support a cash positive outlook for the property.
Approximately 470 positions at the Velardena operations are being eliminated as a result of the suspension.
The company is negotiating the specific terms of a severance package with its labor unions. The company plans to retain a core group of approximately 50 to 60 employees to facilitate a re-start of operations and to maintain and safeguard the longer term value of the asset.
For the complete statement:
And now confidence between Eurozone banks is gone!!
(courtesy Pivotfarm)
And now confidence between Eurozone banks is gone!!
(courtesy Pivotfarm)
(courtesy Pivotfarm)
Eurozone Banks: Confidence Gone!
Submitted by Pivotfarm on 06/21/2013 16:11 -0400
- Ben Bernanke
- China
- Creditors
- Crude
- Crude Oil
- European Central Bank
- European Union
- Eurozone
- Fail
- Federal Reserve
- Germany
- Greece
- Hyperinflation
- Insider Trading
- International Monetary Fund
- Iran
- Joseph Stiglitz
- Market Crash
- Milton Friedman
- NASDAQ
- Nasdaq 100
- Portugal
- United Kingdom
As if the Greeks don’t have enough to deal with right now with their country cut off from the benefits of a national television and radio station. What is it they say in the UK? Something like ‘when it rains it pours’. You might as well get your brollies out boys and girls, as this one looks like it is going to come down in torrents. You might also, with just a hint of imagery and poetic license, say that Europe has decided to pile it on with a shovel in heapfulls right now. Talk about kick a man while he is down.
Eurozone
The European Union prided itself on their motto of ‘United in Diversity’. That was chosen back in 2000, when the Euro was nothing more than a twinkle in the eye of the founding fathers. It still had two years of gestation before it would see the light of day on that historic 1st January 2002.
United in diversity, cultural diversity and ethnic origins, ideas and ways of thinking. The modern-day melting-pot-come-salad-bowl, with the French as the tangy onions and the Brits as the squashed tomatoes of the EU, with just a dash of sharp vinegar from the Germans to keep everybody smarting as it got tossed in the air. Literally, the diversity-unity conundrum did get tossed somewhere. Somewhere out of reach, it seems.
Eurozone: Diveristy
Today, the motto should be changed. It’s more like ‘Disunity with Adversity’. Now, the Eurozone banks have started refusing to lend to each other, spreading the word that confidence has ebbed yet lower in the stakes, in the wake of the bailouts that have taken place.
Data from the European Central Bank shows that interbank lending is back to what it was at the start of the Euro, when everybody had cold feet and nobody knew if Bank A was telling the truth to Bank B and if Country C was telling fibs over the state of its economy. Then, things picked up and lending went wild. But, the white lies are the worst ones to swallow. They leave a bitter taste. Insidious little baskets (of olives)! Some might say that they were right to have cold feet.
Cross-border lending between banks in the Eurozone dropped to 22.5% in April. It stood at 34.5% before the financial crisis put the dampers on all that. European banks have closed in upon themselves and gone into hiding like jack-rabbits. They are more interested and more confident in their domestic markets. Although, is that surprising?Get your own house into order before you can start helping somebody else out, right? Analysts have shown that German interbank funding fell by 11.2% compared with March 2012. That means that there has been the equivalent of €29.5 billion withdrawn from the German economy alone. Greece has suffered a loss of €18 billion being withdrawn from the banking system. Germany might be able to stand that sort of withdrawal, but the question as to whether or not Greece can is definitely not hard to answer. Portugal has had a reduction of 25%, on average.
- Ben Bernanke
- China
- Creditors
- Crude
- Crude Oil
- European Central Bank
- European Union
- Eurozone
- Fail
- Federal Reserve
- Germany
- Greece
- Hyperinflation
- Insider Trading
- International Monetary Fund
- Iran
- Joseph Stiglitz
- Market Crash
- Milton Friedman
- NASDAQ
- Nasdaq 100
- Portugal
- United Kingdom
As if the Greeks don’t have enough to deal with right now with their country cut off from the benefits of a national television and radio station. What is it they say in the UK? Something like ‘when it rains it pours’. You might as well get your brollies out boys and girls, as this one looks like it is going to come down in torrents. You might also, with just a hint of imagery and poetic license, say that Europe has decided to pile it on with a shovel in heapfulls right now. Talk about kick a man while he is down.
Eurozone
The European Union prided itself on their motto of ‘United in Diversity’. That was chosen back in 2000, when the Euro was nothing more than a twinkle in the eye of the founding fathers. It still had two years of gestation before it would see the light of day on that historic 1st January 2002.
United in diversity, cultural diversity and ethnic origins, ideas and ways of thinking. The modern-day melting-pot-come-salad-bowl, with the French as the tangy onions and the Brits as the squashed tomatoes of the EU, with just a dash of sharp vinegar from the Germans to keep everybody smarting as it got tossed in the air. Literally, the diversity-unity conundrum did get tossed somewhere. Somewhere out of reach, it seems.
Eurozone: Diveristy
Today, the motto should be changed. It’s more like ‘Disunity with Adversity’. Now, the Eurozone banks have started refusing to lend to each other, spreading the word that confidence has ebbed yet lower in the stakes, in the wake of the bailouts that have taken place.
Data from the European Central Bank shows that interbank lending is back to what it was at the start of the Euro, when everybody had cold feet and nobody knew if Bank A was telling the truth to Bank B and if Country C was telling fibs over the state of its economy. Then, things picked up and lending went wild. But, the white lies are the worst ones to swallow. They leave a bitter taste. Insidious little baskets (of olives)! Some might say that they were right to have cold feet.
Cross-border lending between banks in the Eurozone dropped to 22.5% in April. It stood at 34.5% before the financial crisis put the dampers on all that. European banks have closed in upon themselves and gone into hiding like jack-rabbits. They are more interested and more confident in their domestic markets. Although, is that surprising?Get your own house into order before you can start helping somebody else out, right? Analysts have shown that German interbank funding fell by 11.2% compared with March 2012. That means that there has been the equivalent of €29.5 billion withdrawn from the German economy alone. Greece has suffered a loss of €18 billion being withdrawn from the banking system. Germany might be able to stand that sort of withdrawal, but the question as to whether or not Greece can is definitely not hard to answer. Portugal has had a reduction of 25%, on average.
The European Central Bank issued a statement saying that it had nothing to do with confidence or mistrust.
But, if the banks aren’t lending to each other, it means that there isn’t the money entering the economy. No money means the real economy isn’t getting its hands on the credit. Banks are wary about extending credit to other members of the EU when they look back at the bail-out that was necessary in Cyprus when one of its major banks had to close, making creditors put up with the losses incurred.
European Union Finance Ministers are meeting today in Luxemburg to discuss resolutions regarding how banks are wound up in order to create some sort of uniformity across the EU (member states do not have the same laws regarding which creditors are to be paid out in the event of a bank going bankrupt). The objective is to put the onus on the private creditors rather than making the taxpayer foot the bill. At last! If they do come to an agreement we won’t be talking of a bail-out, but a bail-in in the future.
However, those decisions might look good to the taxpayer, but they are eating away at confidence in the banking sector. Large deposit holders look like they are worrying about the fact that private creditors may not be able to bail-in the banks that fail in the future, simply because they too will be failing, crushed under the losses. Nervousness means that they might decide to withdraw deposits and nobody needs anyone to draw a picture of what will happen then.
All of this comes at the same time (remember: it never rains, but pours?) as the International Monetary Fund’s decision was announced that it will suspend payments that are aiding Greece in July if the Eurozone does not patch up the shortfall (roughly €3 billion-€4 billion) in the rescue plan (worth €172 billion). International-Monetary Fund regulations stipulate that governments must prove that they have financing that is 12 months ahead in order to receive disbursement. Funding will be interrupted (if they stick to the book) since Greece only has financing covered until this time 2014. Given the current mistrust of the finances of other economies in the Eurozone, it looks doubtful if pulling that one off is going to be an easy task.
Mistrust is viral. Once it has set in and it cankers away at the banking system, it will take a hell of a change to bring it back and make it swing the other way.
I will leave you today with another of Dr Craig Robert's gems:
(courtesy Paul Craig Roberts)
The Rational Market Myth
armageddon without nukes
Paul Craig Roberts
One of the myths of economics is that markets are rational. Theories are based on this assumption, and the belief that markets are rational fuels the argument against regulation. The market response to the Federal Reserve’s June 19 statement that it will taper off its bond purchases if its forecast comes true is unequivocal proof that markets are irrational.
The Federal Reserve’s statement that it "currently anticipates that it would be appropriate to moderate the monthly pace of purchases [of bonds] later this year" depends on a very big if. The if is the correctness of the Fed’s forecast of moderate economic growth and employment gains.
The Fed has not stopped purchasing $85 billion of bonds each month. So nothing real has changed. Indeed, there was no new information in the Fed’s statement. It has been known for some time that, according to the Fed, its bond purchases will gradually cease.
In response to this repeat of old information, the stock and bond markets sold off in a major way on June 19-20. This market response to the Fed’s statement indicates that the Fed’s forecast is unlikely to come true. Low interest rates and a high stock market are totally dependent on the liquidity that the Fed is injecting by printing $1,000 billion per year. If this liquidity is not injected, what will sustain the markets? If the markets crash and interest rates rise, how can the Fed expect recovery?
In other words, the participants in the stock and bond markets know that the markets are bubbles created by the printing press. There is no real basis for the high stock and bond prices. The prices are an artificial reality created by the printing press. Rational markets would take into account the printing press element and would price stocks and bonds at a much lower level.
Zero real interest rates mean that there are no risks. But how can there be no risk in Treasury bonds when the debt is growing faster than the economy?
Normally, high stock values mean strong profits from strong consumer income growth and retail sales. But we know that there is no growth in real median family income and real retail sales.
I suspect that the reason the Fed made the announcement, which seems to be derailing the Fed’s forecast of recovery on which the announcement depends, is to relieve pressure on the US dollar. For several years the Fed has been printing 1,000 billion new dollars each year. There is no demand for these dollars. So far these dollars have inflated stock and bond prices instead of consumer prices. But the implication for the dollar’s price or exchange value in currency markets is clear. The supply is increasing faster than the demand. If the dollar falters, the Fed would lose control. Rising import prices would soon drive domestic inflation and interest rates far higher than the Fed’s targets.
Washington has succeeded in getting Japan and the EU to print yen and euros in order to eliminate the likelihood of flight to other large currency alternatives to the dollar. Smaller countries have also had to print in order to protect their export markets. With so many countries printing money, the Fed’s statement implying that the US might stop printing makes the dollar look good, and, indeed, the dollar rose on the currency exchange markets.
Having neutralized the alternative currency threat to the dollar, the Fed and its agents, the bullion banks, the banks too big to fail, are still at work against the gold and silver threats to the dollar. Massive short selling of gold began at the beginning of April. Again on June 20 massive shorts of gold were sold at a time of day chosen to maximize the price decline. Only those who intend to drive down the price would sell in this way.
Since QE began, the Fed has deprived retirees of interest income and has forced retirees to spend down their capital in order to pay living expenses. Judging from the initial market response, the Fed’s latest policy announcement is adversely impacting bond, stock and real estate investors, and the manipulation of the bullion markets continues to wreak destruction on wealth stored in the only known safe haven.
How can a recovery happen when the Fed is destroying wealth?
The Fed’s irrational behavior could be seen as rational if the assumption is that the Fed’s intent is not to save the economy but to save the banks. As the Fed is committed to saving the banks "too big to fail," it is likely that the banks know of the Fed’s announcements in advance. With inside information, the banks know precisely when to short the stock, bond, and bullion markets. The banks make billions from the inside information. The billions made help to restore the banks’ balance sheets.
Guy Lawson’s book, Octopus (2012), shows that front-running on the basis of inside information has always been the source of financial fortunes. In order to save the banks, the Fed now supplies the inside information.
How is this going to play out? I suspect that the recovery, although officially a weak one, does not really exist. However, thanks to statistical artifacts that understate inflation and unemployment and overstate GDP growth, the Fed and the markets think that a recovery of sorts is in process and that the unprecedented money printing by the Fed will succeed in shifting the economy into high gear.
No such thing is likely to happen. Instead, as 2013 progresses, a further downturn will become visible through the orchestrated statistics. This time the Fed will have to get the printed money past the banks and into the economy, and inflation will explode. The dollar will collapse, and import prices--as globalism has turned the US into an import-dependent economy--will turn high inflation into hyperinflation. Disruptions in food and energy deliveries will become widespread, and a depreciated currency will cease to be used as a means of exchange.
I wouldn’t bet my life on this prediction, but I think it is as likely as the Fed’s prediction of a full recovery that allows the Fed to terminate its bond purchases and money printing by June 2014.
Americans, who have been on top of the world since the late 1940s, are not prepared for the adjustments that they are likely to have to make. And neither is their government.http://www.paulcraigroberts.org/
end
But, if the banks aren’t lending to each other, it means that there isn’t the money entering the economy. No money means the real economy isn’t getting its hands on the credit. Banks are wary about extending credit to other members of the EU when they look back at the bail-out that was necessary in Cyprus when one of its major banks had to close, making creditors put up with the losses incurred.
European Union Finance Ministers are meeting today in Luxemburg to discuss resolutions regarding how banks are wound up in order to create some sort of uniformity across the EU (member states do not have the same laws regarding which creditors are to be paid out in the event of a bank going bankrupt). The objective is to put the onus on the private creditors rather than making the taxpayer foot the bill. At last! If they do come to an agreement we won’t be talking of a bail-out, but a bail-in in the future.
However, those decisions might look good to the taxpayer, but they are eating away at confidence in the banking sector. Large deposit holders look like they are worrying about the fact that private creditors may not be able to bail-in the banks that fail in the future, simply because they too will be failing, crushed under the losses. Nervousness means that they might decide to withdraw deposits and nobody needs anyone to draw a picture of what will happen then.
All of this comes at the same time (remember: it never rains, but pours?) as the International Monetary Fund’s decision was announced that it will suspend payments that are aiding Greece in July if the Eurozone does not patch up the shortfall (roughly €3 billion-€4 billion) in the rescue plan (worth €172 billion). International-Monetary Fund regulations stipulate that governments must prove that they have financing that is 12 months ahead in order to receive disbursement. Funding will be interrupted (if they stick to the book) since Greece only has financing covered until this time 2014. Given the current mistrust of the finances of other economies in the Eurozone, it looks doubtful if pulling that one off is going to be an easy task.
Mistrust is viral. Once it has set in and it cankers away at the banking system, it will take a hell of a change to bring it back and make it swing the other way.
I will leave you today with another of Dr Craig Robert's gems:
(courtesy Paul Craig Roberts)
armageddon without nukes
Paul Craig Roberts
One of the myths of economics is that markets are rational. Theories are based on this assumption, and the belief that markets are rational fuels the argument against regulation. The market response to the Federal Reserve’s June 19 statement that it will taper off its bond purchases if its forecast comes true is unequivocal proof that markets are irrational.
The Federal Reserve’s statement that it "currently anticipates that it would be appropriate to moderate the monthly pace of purchases [of bonds] later this year" depends on a very big if. The if is the correctness of the Fed’s forecast of moderate economic growth and employment gains.
The Fed has not stopped purchasing $85 billion of bonds each month. So nothing real has changed. Indeed, there was no new information in the Fed’s statement. It has been known for some time that, according to the Fed, its bond purchases will gradually cease.
In response to this repeat of old information, the stock and bond markets sold off in a major way on June 19-20. This market response to the Fed’s statement indicates that the Fed’s forecast is unlikely to come true. Low interest rates and a high stock market are totally dependent on the liquidity that the Fed is injecting by printing $1,000 billion per year. If this liquidity is not injected, what will sustain the markets? If the markets crash and interest rates rise, how can the Fed expect recovery?
In other words, the participants in the stock and bond markets know that the markets are bubbles created by the printing press. There is no real basis for the high stock and bond prices. The prices are an artificial reality created by the printing press. Rational markets would take into account the printing press element and would price stocks and bonds at a much lower level.
Zero real interest rates mean that there are no risks. But how can there be no risk in Treasury bonds when the debt is growing faster than the economy?
Normally, high stock values mean strong profits from strong consumer income growth and retail sales. But we know that there is no growth in real median family income and real retail sales.
I suspect that the reason the Fed made the announcement, which seems to be derailing the Fed’s forecast of recovery on which the announcement depends, is to relieve pressure on the US dollar. For several years the Fed has been printing 1,000 billion new dollars each year. There is no demand for these dollars. So far these dollars have inflated stock and bond prices instead of consumer prices. But the implication for the dollar’s price or exchange value in currency markets is clear. The supply is increasing faster than the demand. If the dollar falters, the Fed would lose control. Rising import prices would soon drive domestic inflation and interest rates far higher than the Fed’s targets.
Washington has succeeded in getting Japan and the EU to print yen and euros in order to eliminate the likelihood of flight to other large currency alternatives to the dollar. Smaller countries have also had to print in order to protect their export markets. With so many countries printing money, the Fed’s statement implying that the US might stop printing makes the dollar look good, and, indeed, the dollar rose on the currency exchange markets.
Having neutralized the alternative currency threat to the dollar, the Fed and its agents, the bullion banks, the banks too big to fail, are still at work against the gold and silver threats to the dollar. Massive short selling of gold began at the beginning of April. Again on June 20 massive shorts of gold were sold at a time of day chosen to maximize the price decline. Only those who intend to drive down the price would sell in this way.
Since QE began, the Fed has deprived retirees of interest income and has forced retirees to spend down their capital in order to pay living expenses. Judging from the initial market response, the Fed’s latest policy announcement is adversely impacting bond, stock and real estate investors, and the manipulation of the bullion markets continues to wreak destruction on wealth stored in the only known safe haven.
How can a recovery happen when the Fed is destroying wealth?
The Fed’s irrational behavior could be seen as rational if the assumption is that the Fed’s intent is not to save the economy but to save the banks. As the Fed is committed to saving the banks "too big to fail," it is likely that the banks know of the Fed’s announcements in advance. With inside information, the banks know precisely when to short the stock, bond, and bullion markets. The banks make billions from the inside information. The billions made help to restore the banks’ balance sheets.
Guy Lawson’s book, Octopus (2012), shows that front-running on the basis of inside information has always been the source of financial fortunes. In order to save the banks, the Fed now supplies the inside information.
How is this going to play out? I suspect that the recovery, although officially a weak one, does not really exist. However, thanks to statistical artifacts that understate inflation and unemployment and overstate GDP growth, the Fed and the markets think that a recovery of sorts is in process and that the unprecedented money printing by the Fed will succeed in shifting the economy into high gear.
No such thing is likely to happen. Instead, as 2013 progresses, a further downturn will become visible through the orchestrated statistics. This time the Fed will have to get the printed money past the banks and into the economy, and inflation will explode. The dollar will collapse, and import prices--as globalism has turned the US into an import-dependent economy--will turn high inflation into hyperinflation. Disruptions in food and energy deliveries will become widespread, and a depreciated currency will cease to be used as a means of exchange.
I wouldn’t bet my life on this prediction, but I think it is as likely as the Fed’s prediction of a full recovery that allows the Fed to terminate its bond purchases and money printing by June 2014.
Americans, who have been on top of the world since the late 1940s, are not prepared for the adjustments that they are likely to have to make. And neither is their government.http://www.paulcraigroberts.org/
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