http://www.zerohedge.com/news/2013-07-06/jp-morgan-vault-gold-drops-new-record-low-brinks-gold-plunges-24-one-day
( ZH also observes the continuing evaporation of physical and wonders where it might be going.... )
Submitted by Tyler Durden on 07/06/2013 19:46 -0400
http://harveyorgan.blogspot.com/2013/07/july-6gld-falls-again-to-96199comex.html
Gold closed down $39.80 to $1212.90 (comex closing time ). Silver is down by 96 cents to $18.73 (comex closing time)
In the access market at 5:00 pm, gold and silver finished trading at the following prices :
gold: 1223.80
At the Comex, the open interest in silver fell by 427 contracts to 135,719.
Tonight, the Comex registered or dealer inventory of gold falls to 1.170 million oz or 36.39 tonnes. This is dangerously low. The total of all gold at the comex (dealer and customer) falls again and registers a reading of 7.418 million oz or 230.73 tonnes of gold.
JPMorgan's customer inventory fell yesterday to 136,380.609 oz or 4.24 tonnes. Its dealer inventory remains at 401,877.493 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 Comex gold dealer account registers only 26.03 tonnes of gold falling again from Wednesday.
JPMorgan's customer inventory is now at a extremely low 136.38 million oz or 4.24 tonnes of gold.
The GLD reported another loss in inventory Friday tonight to the tune of 2.7 tonnes with an inventory reading of 961.99 tonnes. The SLV inventory of silver showed a huge gain of 2.894 million oz of silver.
The total gold comex open interest rose by 4,671 contracts from 410,399 up to 415,070 with gold rising by $8.50 on Wednesday. We are now into the the non active July contract and here the OI rests at 91 down 20 contracts . We had 20 delivery notice filed on Wednesday so in essence we neither lost nor gained any gold standing for the July delivery month. The next active delivery month for gold is August and here the OI fell by 5601 contracts from 214,481 down to 208,880. The estimated volume today was good at 227,702 contracts. The confirmed volume on Wednesday was also good at 188,094.
The total silver Comex OI fell by 427 contracts with silver rising in price on Wednesday by 8 cents. The total of all comex silver OI stands at 135,719 contracts. We are now into the big delivery month of July and here the OI fell by 312 contracts down to 1734. We had 316 notices filed on Wednesday so in essence we gained 4 contracts or 20,000 oz. The next big delivery month is September and here the OI dropped by 196 contracts down to 79,838. The estimated volume today was good coming in at 53,664 contracts. The confirmed volume on Wednesday was good at 40,604.
We had 1 customer deposits today :
i) Into Scotia: 36,121.349 oz
total customer deposits: 36,121.349 oz
we had 1 customer withdrawals
i) Out of JPMorgan: 6831.54 oz
i) Customer withdrawals: 6,831.54 oz
total customer withdrawals: 6831.54 oz
Today we had 2 adjustments
i) Adjusted out of the dealer Brinks, 197.65 oz and into the customer at Brinks
ii) adjusted out of the dealer Scotia , 20,543.03 oz and into the customer at Scotia.
Thus tonight we have the following JPMorgan gold inventory:
JPM dealer inventory: 401,877.493 oz 12.50 tonnes
JPM customer inventory: 136,380.609 oz or 4.24 tonnes
As we reported to you 4 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 (May 28), 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 tonight 28,389.579 oz was settled upon, leaving 71,611.00 oz still left to arrive in the settling process.
Tuesday, June 11, we had 217,844.96 actual ounces leave JPMorgan
and on, June 28.2013 we had 4,817.251 oz leave jPMorgan customer account
and today July 5.2013: we had 6831.54 oz leave jPMorgan customer account
Summary for the last week of issuance from JPMorgan:
On Friday, June 28th we had 23 notices filed and all of these were issued by JPMorgan on the customer side.
Tuesday we had 24 contracts were issued and all from the dealer or house account.
Yesterday, 20 contracts were issued and all from JPMorgan's dealer or house account.
Today,we had 10 contracts were issued and all from JPMorgan's dealer or house account.
In summary on the customer side of things for JPMorgan:
Thus on JPMorgan customer side:
On Friday, the 28th of June, I reported that we had from the beginning of June, 2543 notices or 254,300 oz issued. If we add the 71,611.00 oz owing from May issuance, we get 325,911 oz. If we subtract the actual withdrawal of gold from JPMorgan of 229,493.75 (which includes Friday's withdrawal customer side 6,831.54), this still leaves 96,417.25 oz that needs to be settled upon from the vaults of JPMorgan customer side.
The total dealer comex gold stays constant tonight at its nadir of 1.170 million oz or 36.39 tonnes of gold.The total of all comex gold, dealer and customer falls again tonight to 7.418 million oz or 230.7 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(dealer account) since first day notice and not yet subtracted out of inventory.
Tuesday, July 2: 24 contracts (notices) were issued by JPMorgan's dealer or house account.
Wednesday: July 3: 20 contracts were issued by JPMorgan's dealer or house account.
Friday: July 5: 10 contracts were issued byJPMorgan's dealer our house account.
You will also recall three 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, 68,444.61 oz was either withdrawn or adjusted out(on the dealer side), leaving the dealer side at 401,877.493 oz where it sits tonight.
On the dealer side here are the last 20 trading sessions as to notices issued from JPMorgan's dealer side:
Friday: zero
Monday: 1
Another disturbing piece of news is the low dealer gold inventory for our 3 major bullion banks(Scotia, HSBC and JPMorgan). Their dealer gold remains at 26.03 tonnes tonight
i) Scotia: 199,044,026 oz or 6.19 tonnes (prev 7.204 tonnes)
ii) HSBC: 236,168.152 oz or 7.34 tonnes
iii) JPMorgan: 401,877.493 oz or 12.50 tonnes
total: 26.03 tonnes
Brinks dealer account which did have the lions share of the dealer gold falls badly tonight to 314,201.98 oz or 9.77 tonnes (from 13.909 tonnes)
Today we had 10 notices served upon our longs for 1000 oz of gold (and all issued by JPMorgan dealer). In order to calculate what I believe will stand for delivery in July, I take the OI for July (91) and subtract out today's notices (10) which leaves us with 81 notices still left to be served upon our longs.
Thus we have the following gold ounces standing for metal:
78 contracts served x 100 oz = 7800 oz, + 81 contracts left to be served upon x 100 oz = 8100 oz to give us 15,900 oz or .4945 tonnes of gold. We neither lost nor gained any gold ounces standing for July.
Ladies and Gentlemen: we have a three-fold problem:
i) the total dealer inventory of gold falls to a very dangerously low level of only 36.39 tonnes and none of the 9.5 tonnes delivery notices from May and the major part of the 30.70 tonnes from June issued by JPM on its dealer side has yet to leave.
ii) a) JPMorgan's customer inventory remains at an extremely low 136,380.609 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 401,877.493 oz. However all of this gold has been spoken for plus an additional 98,122.51 oz of deficient gold.
iii) the 3 major bullion banks have collectively only 26.03 tonnes of gold left in their dealer account.
i) Out of Scotia; 250,689.66 oz
ii) Out of Brinks: 282,264.44 oz
iii) Out of Delaware: 7787.847 oz
total customer withdrawal : 540,741.947 oz
Now let us check on gold inventories at the GLD first:
July 5.2013: we lost 2.7 tonnes
July 3.2013: zero lost
( ZH also observes the continuing evaporation of physical and wonders where it might be going.... )
JP Morgan Vault Gold Drops To New Record Low; Brinks Gold Plunges By 24% In One Day
Last week we defined the golden sentiment ruleas "anything that isn't off the chart soon will be." This will happen in a "perfectly sustainable" fashion, where increasingly more paper gold is shorted to record levels even as actual physical holdings held by official Comex vaults continues to drop. For one particular reason why the price of paper gold may be at 3 year lows, we will provide some formerly classified perspective shortly in a post. But in the meantime, and while we await the weekly CFTC commitment of traders report (delayed until Monday due to the July 4 holiday), we are happy to report that the JPM disconnect between the epic delivery requests and its reported gold holdings (for which the "Commodity Exchange, Inc. disclaims all liability whatsoever with regard to its accuracy or completeness") reconnected modestly, and as per the latest Comex update, another 6.8k ounces of gold was pulled from JPM's 1 CMP world's biggest gold vault, dropping its total gold inventory to a fresh record low.
Perhaps even more notable is that on Friday, that "other" depository, Brink's, saw 24% of its entire registered gold holdings, or 133k ounces, quietly get withdrawn. This, together with the moves in JPM and HSBC inventory, meant that total Comex gold holdings dropped by 116K ounces to a new low not seen for the first time since 2006.
Finally, for that all important marginal source of paper gold supply or demand, ETFs,the two largest ones (GLD and IAU) have now retraced 50% of their "holdings" gain since the fall of Lehman.
Someone more inquisitive than us may wonder: just where is all this gold being "withdrawn" to...
http://harveyorgan.blogspot.com/2013/07/july-6gld-falls-again-to-96199comex.html
Friday, July 5, 2013
July 6/GLD falls again to 961.99/Comex dealer gold falls/Comex total gold inventory falls as does JPMorgan customer gold..
Good morning Ladies and Gentlemen:
Gold closed down $39.80 to $1212.90 (comex closing time ). Silver is down by 96 cents to $18.73 (comex closing time)
In the access market at 5:00 pm, gold and silver finished trading at the following prices :
gold: 1223.80
silver: $18.90
It was no secret today that a raid was going to be orchestrated around the jobs report. It happens time and time again so I will not discuss the raid any further.
It was no secret today that a raid was going to be orchestrated around the jobs report. It happens time and time again so I will not discuss the raid any further.
At the Comex, the open interest in silver fell by 427 contracts to 135,719.
The open interest on the entire gold comex contracts rose by 4621 contracts to 415,070 with gold's rise in price on Wednesday.
Tonight, the Comex registered or dealer inventory of gold falls to 1.170 million oz or 36.39 tonnes. This is dangerously low. The total of all gold at the comex (dealer and customer) falls again and registers a reading of 7.418 million oz or 230.73 tonnes of gold.
JPMorgan's customer inventory fell yesterday to 136,380.609 oz or 4.24 tonnes. Its dealer inventory remains at 401,877.493 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 Comex gold dealer account registers only 26.03 tonnes of gold falling again from Wednesday.
JPMorgan's customer inventory is now at a extremely low 136.38 million oz or 4.24 tonnes of gold.
The GLD reported another loss in inventory Friday tonight to the tune of 2.7 tonnes with an inventory reading of 961.99 tonnes. The SLV inventory of silver showed a huge gain of 2.894 million oz of silver.
On the physical side of things, we have commentaries from Ted Butler, Bloomberg's Sedgman, and Kito's Letourneau on the big writedown of Barrick's Pascua Lama project.
On the paper side of things, we have a extremely important Mark Grant commentary on new currency wars and later he added a second one.
To conclude we have a great commentary from Paul Craig Roberts and Paul Price.
On the paper side of things, we have a extremely important Mark Grant commentary on new currency wars and later he added a second one.
To conclude we have a great commentary from Paul Craig Roberts and Paul Price.
We will go over these and many other stories today, 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 4,671 contracts from 410,399 up to 415,070 with gold rising by $8.50 on Wednesday. We are now into the the non active July contract and here the OI rests at 91 down 20 contracts . We had 20 delivery notice filed on Wednesday so in essence we neither lost nor gained any gold standing for the July delivery month. The next active delivery month for gold is August and here the OI fell by 5601 contracts from 214,481 down to 208,880. The estimated volume today was good at 227,702 contracts. The confirmed volume on Wednesday was also good at 188,094.
The total silver Comex OI fell by 427 contracts with silver rising in price on Wednesday by 8 cents. The total of all comex silver OI stands at 135,719 contracts. We are now into the big delivery month of July and here the OI fell by 312 contracts down to 1734. We had 316 notices filed on Wednesday so in essence we gained 4 contracts or 20,000 oz. The next big delivery month is September and here the OI dropped by 196 contracts down to 79,838. The estimated volume today was good coming in at 53,664 contracts. The confirmed volume on Wednesday was good at 40,604.
Comex gold/May contract month:
July 5/2013
the July contract month
the July contract month
Ounces
| |
Withdrawals from Dealers Inventory in oz
|
145,226.33 oz(Brinks,Scotia)
|
Withdrawals from Customer Inventory in oz
|
6,831.54 (JPM)
|
Deposits to the Dealer Inventory in oz
|
nil
|
Deposits to the Customer Inventory, in oz
| 36,121.349 (Scotia) |
No of oz served (contracts) today
|
10 (1000 oz)
|
No of oz to be served (notices)
|
81 (8,100 oz)
|
Total monthly oz gold served (contracts) so far this month
|
78 (7800 oz)
|
Total accumulative withdrawal of gold from the Dealers inventory this month
|
145,226.33 oz
|
Total accumulative withdrawal of gold from the Customer inventory this month
| 41,744.19 oz |
We had huge activity at the gold vaults
The dealer had 0 deposits but did have 2 gigantic withdrawals.
i) out of dealer: Brinks: 133,194.23 oz (to settle o/s longs)
ii) out of the dealer Scotia: 12,032.108 oz
total dealer withdrawal: 145,226.33 oz
i) out of dealer: Brinks: 133,194.23 oz (to settle o/s longs)
ii) out of the dealer Scotia: 12,032.108 oz
total dealer withdrawal: 145,226.33 oz
We had 1 customer deposits today :
i) Into Scotia: 36,121.349 oz
total customer deposits: 36,121.349 oz
we had 1 customer withdrawals
i) Out of JPMorgan: 6831.54 oz
i) Customer withdrawals: 6,831.54 oz
total customer withdrawals: 6831.54 oz
Today we had 2 adjustments
i) Adjusted out of the dealer Brinks, 197.65 oz and into the customer at Brinks
ii) adjusted out of the dealer Scotia , 20,543.03 oz and into the customer at Scotia.
Thus tonight we have the following JPMorgan gold inventory:
JPM dealer inventory: 401,877.493 oz 12.50 tonnes
JPM customer inventory: 136,380.609 oz or 4.24 tonnes
As we reported to you 4 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 (May 28), 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 tonight 28,389.579 oz was settled upon, leaving 71,611.00 oz still left to arrive in the settling process.
Tuesday, June 11, we had 217,844.96 actual ounces leave JPMorgan
and on, June 28.2013 we had 4,817.251 oz leave jPMorgan customer account
and today July 5.2013: we had 6831.54 oz leave jPMorgan customer account
Summary for the last week of issuance from JPMorgan:
On Friday, June 28th we had 23 notices filed and all of these were issued by JPMorgan on the customer side.
Tuesday we had 24 contracts were issued and all from the dealer or house account.
Yesterday, 20 contracts were issued and all from JPMorgan's dealer or house account.
Today,we had 10 contracts were issued and all from JPMorgan's dealer or house account.
In summary on the customer side of things for JPMorgan:
Thus on JPMorgan customer side:
On Friday, the 28th of June, I reported that we had from the beginning of June, 2543 notices or 254,300 oz issued. If we add the 71,611.00 oz owing from May issuance, we get 325,911 oz. If we subtract the actual withdrawal of gold from JPMorgan of 229,493.75 (which includes Friday's withdrawal customer side 6,831.54), this still leaves 96,417.25 oz that needs to be settled upon from the vaults of JPMorgan customer side.
The total dealer comex gold stays constant tonight at its nadir of 1.170 million oz or 36.39 tonnes of gold.The total of all comex gold, dealer and customer falls again tonight to 7.418 million oz or 230.7 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(dealer account) since first day notice and not yet subtracted out of inventory.
Tuesday, July 2: 24 contracts (notices) were issued by JPMorgan's dealer or house account.
Wednesday: July 3: 20 contracts were issued by JPMorgan's dealer or house account.
Friday: July 5: 10 contracts were issued byJPMorgan's dealer our house account.
You will also recall three 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, 68,444.61 oz was either withdrawn or adjusted out(on the dealer side), leaving the dealer side at 401,877.493 oz where it sits tonight.
On the dealer side here are the last 20 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
Monday:0
Tuesday: 0
Wednesday: 0
Thursday:0
Friday: 0
Monday: 0
Tuesday: 24
Wednesday: 20
Thursday/Friday: 10
Thus, 5000 notices have been issued by JPMorgan (dealer side) for the month of June and the beginning of July for 500,000 oz and these ounces have yet to settle from JPMorgan's dealer side.
JPMorgan's dealer vault registers tonight 401,877.493 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 98,122.51 oz (401,877.493 inventory - 500,000 oz issued = -98,122.51 oz)
In other words, the entire 401,877.493 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 98,122.51 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
Monday:0
Tuesday: 0
Wednesday: 0
Thursday:0
Friday: 0
Monday: 0
Tuesday: 24
Wednesday: 20
Thursday/Friday: 10
Thus, 5000 notices have been issued by JPMorgan (dealer side) for the month of June and the beginning of July for 500,000 oz and these ounces have yet to settle from JPMorgan's dealer side.
JPMorgan's dealer vault registers tonight 401,877.493 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 98,122.51 oz (401,877.493 inventory - 500,000 oz issued = -98,122.51 oz)
In other words, the entire 401,877.493 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 98,122.51 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). Their dealer gold remains at 26.03 tonnes tonight
i) Scotia: 199,044,026 oz or 6.19 tonnes (prev 7.204 tonnes)
ii) HSBC: 236,168.152 oz or 7.34 tonnes
iii) JPMorgan: 401,877.493 oz or 12.50 tonnes
total: 26.03 tonnes
Brinks dealer account which did have the lions share of the dealer gold falls badly tonight to 314,201.98 oz or 9.77 tonnes (from 13.909 tonnes)
Today we had 10 notices served upon our longs for 1000 oz of gold (and all issued by JPMorgan dealer). In order to calculate what I believe will stand for delivery in July, I take the OI for July (91) and subtract out today's notices (10) which leaves us with 81 notices still left to be served upon our longs.
Thus we have the following gold ounces standing for metal:
78 contracts served x 100 oz = 7800 oz, + 81 contracts left to be served upon x 100 oz = 8100 oz to give us 15,900 oz or .4945 tonnes of gold. We neither lost nor gained any gold ounces standing for July.
Ladies and Gentlemen: we have a three-fold problem:
i) the total dealer inventory of gold falls to a very dangerously low level of only 36.39 tonnes and none of the 9.5 tonnes delivery notices from May and the major part of the 30.70 tonnes from June issued by JPM on its dealer side has yet to leave.
ii) a) JPMorgan's customer inventory remains at an extremely low 136,380.609 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 401,877.493 oz. However all of this gold has been spoken for plus an additional 98,122.51 oz of deficient gold.
iii) the 3 major bullion banks have collectively only 26.03 tonnes of gold left in their dealer account.
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:
July 5/2013: July silver contract month:
July contract month
July contract month
| Silver |
Ounces
|
| Withdrawals from Dealers Inventory | 20,105.63 oz(Scotia) |
| Withdrawals from Customer Inventory | 540,741.947 oz (Brinks , Delaware Scotia,) |
| Deposits to the Dealer Inventory | nil |
| Deposits to the Customer Inventory | nil |
| No of oz served (contracts) | 221 (1,105,000 oz) |
| No of oz to be served (notices) | 1513 (7,565,000 oz) |
| Total monthly oz silver served (contracts) | 1811 (9,055,000) |
| Total accumulative withdrawal of silver from the Dealers inventory this month | 4844.70 |
| Total accumulative withdrawal of silver from the Customer inventory this month | 830,693.73 oz |
Today, we had huge activity inside the silver vaults.
we had 0 dealer deposits and 1 dealer withdrawal.
i) out of the dealer Scotia: 20,105.63 oz
We had 0 customer deposits:
total customer deposit: nil oz
We had 3 customer withdrawals:
i) out of the dealer Scotia: 20,105.63 oz
We had 0 customer deposits:
total customer deposit: nil oz
We had 3 customer withdrawals:
i) Out of Scotia; 250,689.66 oz
ii) Out of Brinks: 282,264.44 oz
iii) Out of Delaware: 7787.847 oz
total customer withdrawal : 540,741.947 oz
we had 1 huge adjustment today
i) out of Scotia: 526,495.610 oz was adjusted out of the customer and into the dealer.
Thus we have the following:
i) out of Scotia: 526,495.610 oz was adjusted out of the customer and into the dealer.
Thus we have the following:
Registered silver at : 46.941 million oz
total of all silver: 165.756 million oz.
The CME reported that we had 221 notices filed for 1,105,000 oz today.
To calculate what will stand for this active delivery month of July, I take the number of contracts served thus far this month at 1811 x 5,000 oz per contract = 9,055,000 oz + 1513 notices left to be served upon our longs x 5000 oz per contract = 7,565,000 to give us a total of 16,620,000 oz
we gained 4 contracts or an additional 20,000 oz will stand for silver this month.
we gained 4 contracts or an additional 20,000 oz will stand for silver this month.
Thus here are the standings:
1811 contracts served x 5000 oz per contract (served) or 9,055,000 oz + 1513 notices x 5,000 oz or = 7,565,000 = 16,620,000 oz
end
The two ETF's that I follow are the GLD and SLV. You must be very careful in trading these vehicles as these funds do not have any beneficial gold or silver behind them. They probably have only paper claims and when the dust settles, on a collapse, there will be countless class action lawsuits trying to recover your lost investment.
There is now evidence that the GLD and SLV are paper settling on the comex.
Now let us check on gold inventories at the GLD first:
July 5.2013: we lost 2.7 tonnes
Tonnes961.99
Ounces30,928,840.80
Value US$37.488 billion
July 3.2013: zero lost
Tonnes964.69
Ounces31,015,807.97
Value US$38.7506 billion
* * *
selected news and views.....
Ted Butler on the new laws of supply and demand with respect to silver:
(courtesy Ted Butler/GATA)
(courtesy Ted Butler/GATA)
Ted Butler: The new law of supply and demand
Submitted by cpowell on Fri, 2013-07-05 15:41. Section: Daily Dispatches
11:46a ET Friday, July 5, 2013
Dear Friend of GATA and Gold:
In commentary excerpted from his latest newsletter, silver market analyst and market-rigging opponent Ted Butler complains again that the prices of gold and silver are being determined by "excessive speculative selling" of futures contracts rather than by genuine transactions between buyers and sellers of real metal and that regulatory authorities do nothing about this perversion of commodity markets. Butler further complains that this "excessive speculative selling" has just driven the prices of gold and silver below their cost of production.
True enough as always, but this analysis falls short of more important points.
First, why do regulatory authorities fail to act? Most likely it is because suppressing the price of the monetary metals has long been Western central bank policy --
-- and the "speculative selling" itself is likely selling by central banks and government treasury departments, as, for example, the U.S. Treasury Department's Exchange Stabilization Fund is authorized to intervene surreptitiously in not just the monetary metals markets but all markets:
And second, with market manipulation making them unprofitable, why do gold and silver mining companies and the trade association of some of the larger gold miners, the World Gold Council, do nothing about it and fail even to object?
That governments will do whatever they can do surreptitiously to destroy competition for their currencies and bonds must be accepted as the nature of government and the corruption of government by power. As deception is the prerequisite for market rigging, it can be constrained only by publicity and greater understanding by market participants. That is GATA's work, work that will always need to be done by somebody outside government in every market.
But if gold and silver mining companies have no objection to market rigging that pushes the price of their products below the cost of production, no one will have any use for them and soon they may not have any work at all. Shareholders in those companies might do well to inquire with company management about this.
Butler's commentary is headlined "The New Law of Supply and Demand" and it's posted at GoldSeek's companion site, SilverSeek, here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Gold Anti-Trust Action Committee Inc.
Gold sales at the Perth mint tumble as the rout as its effect on future buyers:
(courtesy Sedgman/Bloomberg news)
By Alex Létourneau of Kitco News
Thursday July 4, 2013 12:00 PM
(Kitco News) - Barrick Gold Corp. (TSX, NYSE: ABX) disclosed Friday that it would take a $5.5 billion impairment charge on its Pascua-Lama project, located along the border of Chile and Argentina, fueling talks of the need to shelve the project.
The world’s leading gold producer will take the impairment hit with production at Pascua-Lama now slated for mid-2016.
What followed was a TD Securities report Tuesday stating that Pascua-Lama, coupled with the writedown risk of Barrick’s 2011 Equinox acquisition and its high-cost Buzwagi mine, could bring a total writedown of $10 billion.
Doug Pollitt of Pollitt & Co., an employee-owned brokerage firm, said weeks before the impairment charge that the "world class decision" would be to shelve Pascua-Lama.
"Pascua-Lama should have been towed out to sea and sunk a long time ago, proverbially speaking," Pollitt said in a June 10 report. "Rarely has there been a project that, distilled to an essence, gives off the scent of an industry so drunk on cheap capital.
"This is all quite harsh, but that’s the mood these days," he added.
Pollitt said that the project was ambitious from the start, citing extreme location as it’s straddled across an international border, extreme altitude, vast in scope with regulatory issues.
"And the technical aspects remain challenging," Pollitt said. "A 43-101 states ‘the (project’s) ore is extremely complex and highly variable.’ Moreover, the rock is so acidic that dry grinding was once considered and there have been reports of a visitor’s coveralls being partially dissolved after a walk-through tour."
There is also the governmental aspect, with the latest seeing the Chilean environmental watchdog suspending the project due to environmental concerns and slapping a multimillion dollar fine on the gold senior.
Pascua-Lama’s potential is well-known with nearly 18 million ounces of proven and probable gold reserves and 676 million ounces of silver contained within the gold reserves. It has an expected mine life of 25 years and is expected to produce an average of 800,000-850,000 ounces of gold and 35 million ounces of silver in its first full five years of operation at all-in sustaining and total cash costs of $50-$200 per ounce and negative $150 to $0 per ounce, respectively.
However, Pollitt doesn’t see the upside.
"Given the grade of the deposit, given the technical challenges of the project, given the various landmines between here and first pour, and comparing these characteristics to Barrick’s existing ops, all with proven operational characteristics in friendlier jurisdictions, it becomes clear that, in relation to the sweet part of its operational portfolio, Pascua at current prices is simply not an attractive project," Pollitt summed up.
For the latest mining news, updates and commentary, or to contact me regarding a story or feedback, please follow my Twitter account @alex_letourneau
(courtesy Sedgman/Bloomberg news)
Gold sales tumble at Perth Mint after rout deters buyers
Submitted by cpowell on Thu, 2013-07-04 15:04. Section: Daily Dispatches
Buyers increased purchases in April "but in May and June have realized that prices are still coming down and it's not doing as well," Ron Currie, sales and marketing director at the mint, said in a phone interview from Perth. "They're waiting to see how the market goes."
By Phoebe Sedgman
Bloomberg News
Thursday, July 4, 2013
Bloomberg News
Thursday, July 4, 2013
MELBOURNE, Australia -- Gold sales from Australia's Perth Mint, which refines nearly all of the bullion mined in the country, declined for a second month in June as prices extended a bear-market slump, deterring buyers.
Sales of gold bars and coins totaled 49,460 ounces in June, compared with 92,781 ounces in May and 116,755 ounces in April, according to data from the mint. Sales were 52,704 ounces in March, before the rout, the data show.
The slowdown adds to signs that while gold's plunge deepened over the second quarter as prices fell to the lowest since August 2010, a buying frenzy seen in April wasn't repeated last month. Bullion lost 23 percent in the three-month period amid speculation that the Federal Reserve will curb its asset-buying program as the U.S. economy recovers. Bullion may drop to $1,050 over 12 months as haven demand wanes, UBS AG said today.
Bullion for immediate delivery was little changed at $1,252.19 an ounce at 3:58 p.m. in Singapore. Prices tumbled 11 percent in June after dropping 6 percent in May and 7.6 percent in April. Analysts at banks from Morgan Stanley to Goldman Sachs Group Inc. trimmed gold forecasts last month.
Sales of coins and jewelry surged around the world after bullion entered a bear market mid-April, spurring a 13 percent rebound in prices in less than three weeks. The rush drove volumes on the Shanghai Gold Exchange, China's largest spot bullion market, to the highest ever in April, bourse data show.
There are signs interest has slowed. The U.S. Mint sold 57,000 ounces of American Eagle gold coins in June from 70,000 ounces in May and 209,500 ounces in April, according to data on its website. In India, the largest user last year, imports may drop 52 percent in the third quarter after government curbs, according to the All India Gems & Jewellery Trade Federation.
Global physical demand has been weaker than in April, partly as India imposed curbs on imports, Barclays Plc said on July 1. So-called price-sensitive buyers may wait for a well-defined bottom before entering the market, James Steel, an analyst at HSBC Securities (USA) Inc., wrote in a June 24 report.
Goldman Sachs cut its price target for the end of 2013 to $1,300 from $1,435 and expects holdings in exchange-traded products to decline by about 1 million ounces (31.1 metric tons) a month, according to a June 23 report. Investors are assuming an earlier tapering of quantitative easing and a Fed fund rate increase sooner than the bank's economists expect, it said.
Assets in the SPDR Gold Trust, the largest bullion-backed ETP, were unchanged yesterday after decreasing to 964.69 tons on July 2, the least since 2009. Investors have sold 595 tons from ETPs this year, according to data compiled by Bloomberg.
There's a risk that ETP holdings may contract by a further 500 tons, Dominic Schnider, head of commodities research at UBS wealth-management unit in Singapore, said on Bloomberg Television's "First Up" with Rishaad Salamat today.
Outflows from ETPs combined with so-called positioning cuts in futures & options will probably increase the availability of gold by 500 tons to 800 tons in the next six to 12 months, Schnider and Giovanni Staunovo wrote in a June 20 report.
So far Barrick has announced 5.5 billion in impairment charges due to Pascua Lama.
They may end up with over 10 billion in charges:
(Kito news)
Barrick's Pascua-Lama Should Be Shelved: Pollitt & Co.
By Alex Létourneau of Kitco News
Thursday July 4, 2013 12:00 PM
(Kitco News) - Barrick Gold Corp. (TSX, NYSE: ABX) disclosed Friday that it would take a $5.5 billion impairment charge on its Pascua-Lama project, located along the border of Chile and Argentina, fueling talks of the need to shelve the project.
The world’s leading gold producer will take the impairment hit with production at Pascua-Lama now slated for mid-2016.
What followed was a TD Securities report Tuesday stating that Pascua-Lama, coupled with the writedown risk of Barrick’s 2011 Equinox acquisition and its high-cost Buzwagi mine, could bring a total writedown of $10 billion.
Doug Pollitt of Pollitt & Co., an employee-owned brokerage firm, said weeks before the impairment charge that the "world class decision" would be to shelve Pascua-Lama.
"Pascua-Lama should have been towed out to sea and sunk a long time ago, proverbially speaking," Pollitt said in a June 10 report. "Rarely has there been a project that, distilled to an essence, gives off the scent of an industry so drunk on cheap capital.
"This is all quite harsh, but that’s the mood these days," he added.
Pollitt said that the project was ambitious from the start, citing extreme location as it’s straddled across an international border, extreme altitude, vast in scope with regulatory issues.
"And the technical aspects remain challenging," Pollitt said. "A 43-101 states ‘the (project’s) ore is extremely complex and highly variable.’ Moreover, the rock is so acidic that dry grinding was once considered and there have been reports of a visitor’s coveralls being partially dissolved after a walk-through tour."
There is also the governmental aspect, with the latest seeing the Chilean environmental watchdog suspending the project due to environmental concerns and slapping a multimillion dollar fine on the gold senior.
Pascua-Lama’s potential is well-known with nearly 18 million ounces of proven and probable gold reserves and 676 million ounces of silver contained within the gold reserves. It has an expected mine life of 25 years and is expected to produce an average of 800,000-850,000 ounces of gold and 35 million ounces of silver in its first full five years of operation at all-in sustaining and total cash costs of $50-$200 per ounce and negative $150 to $0 per ounce, respectively.
However, Pollitt doesn’t see the upside.
"Given the grade of the deposit, given the technical challenges of the project, given the various landmines between here and first pour, and comparing these characteristics to Barrick’s existing ops, all with proven operational characteristics in friendlier jurisdictions, it becomes clear that, in relation to the sweet part of its operational portfolio, Pascua at current prices is simply not an attractive project," Pollitt summed up.
For the latest mining news, updates and commentary, or to contact me regarding a story or feedback, please follow my Twitter account @alex_letourneau
The Currency Wars Reignite
Submitted by Tyler Durden on 07/05/2013 08:16 -0400
- Bank of England
- Central Banks
- European Central Bank
- France
- Germany
- Ireland
- Italy
- Portugal
- Real estate
- Reality
Via Mark J. Grant, author of Out of the Box,
“Always remember, your focus determines your reality.”
-George Lucas
Our reality has changed in the last twenty-four hours. The Bank of England and the European Central Bank have re-affirmed their old positions since the Fed has changed tacks. The initial reactions will be a spike in equities and a fall-off in the valuations of the Pound and the Euro to the Dollar. These, however, are first blush reactions as the color fades from the bloom.
It may well be, as Europe is in much worse financial condition than the United States, that there is a policy reason for the European positions but it may well also be a calculated move to devalue the major European currencies. Whatever the actual reasons, the European statements have certainly sounded the trumpet that the “Currency Wars” have reignited.
The impact of the Euro/Dollar at 1.25 and then 1.20 will be a positive for Europe as exports rise and a negative for America as exports fall and imports rise. The sword could be double edged though as the Fed, in response, begins to cull back on the more than $1 trillion that it has lent to the European banks. Many truths will be shrouded in mystery but the impact will be there regardless.
It is a dangerous game when the world’s central banks that have been working for the last five years in unison and now they head down different paths. You may expect tears at the seams and various ripping sounds as Europe moves away from the Fed. Mr. Carney and Mr. Draghi have buddied up while poor Ben is left to wander alone.
The trumpets that had heralded “The Three Kings” now sound just for two and the drums that have beat in unison now will sound a disconnected harmony. America has gone left and Europe has gone right and there will be consequences for both.
I mention one other thing this morning that is surely coming and it will be the hammering of the gong. The ECB has massive securitizations that are being carried at par (100 cents on the Dollar) at the ECB and at the European banks. The losses, with many tied to Real Estate, must be staggering. There will be a time, a moment, after “extend and pretend” runs out when these losses must be faced. These securitizations are guaranteed, in the case of Spain as one example, by the sovereign ($51.6 billion in the case of Spain). Others, I have heard, are guaranteed by the major European banks. The poorer nations in Europe will want the ECB to take the hits, shared losses, but Germany will vehemently object.
France, Italy, Spain, Portugal and Ireland cannot afford the losses. The hits would bankrupt or severely impair most of the European banks. The clock is running and midnight will be approaching sometime during the next twelve months.
I fear what we don’t know and what is hidden. Realization will eventually arrive because it must. A very unpleasant reality will surface. When you shout and scream and make false claims that the money is in the drawer the day will arrive, because you need the money, that you open the drawer and it is not there. That day is one of reckoning. The Europeans will not enjoy it!
Protests Sweep Bulgaria As Government Collapses Amid Chaos
Protests Sweep Bulgaria As Government Collapses Amid Chaos
The Bulgarian government was officially dissolved on Wednesday with the resignation of Prime Minister Boiko Borisov as thousands took to the street to protest against high electricity bills and declining living standards. The country, which joined the EU in 2001, remains the poorest member of the union after a long and troubled transition to capitalism.
The first casualty of the on-going crisis became Bulgarian finance minister Simeon Djankov — a well-respected former World Bank official who undertook painful economic reforms and austerity measures. Djankov stepped down on Tuesday in the middle of escalating protests in the capital of Sofia where people with signs that read "Mafia" and "Bring Down the Monopolies" were rallying against lack of transparency and monopolistic practices in the energy sector.
As the nationwide protest steadily turned against "Everything and Everyone," violent clashes with the police errupted leaving at least 25 injured in Sofia which increased the pressure on Borisov's leadership three months before the official end of his term.
Borisov, known for his hard-line can-do style, has successfully carried out ambitious infrastructure projects and EU programs. However, rising unemployment and soaring living costs have put millions of Bulgarians on the brink of poverty in a country where the average monthly salary continues to be less than 400 euros a month.
In a surprise move on Wednesday Prime Minister Borisov officially announced his resignation, saying, "I am unable to witness the blood on the streets. The people put us in power and today we give it back to them." His centrist GERB party will not participate in the formation of a new government which leaves many open questions about the political stability of the country.
Bulgarian President Rosen Plevneliev addressed the nation and announced his efforts to put together an interim government until the elections can be held this spring.
Despite the cabinet resignation the violent clashes in Sofia have intensified late on Wednesday as protesters demand the exit of the entire political establishment.
A 36-year-old man set himself on fire in the city of Varna where protests are demanding Mayor Kiril Yordanov's resignation. Yordanov is currently serving his fourth consecutive term and has held the post since 1999.
Lack of fresh ideas and alternatives have paralyzed the aging and complacent political class of Bulgaria. More than three million Bulgarians, which accounts for close to 40% of the total population, have left the country since the fall of communism in search of better education and job opportunities.
Those who have remained in the country have steadily seen their post-communism dreams disappear in corruption, political scandals and rising unemployment among young people.
Similar protests have been sparked in Slovenia where the government is struggling to remain in power. One protester, Miha Borovovec, said, "This government is totalitarian, it is corrupt, it is taking our country down. That’s why I am here; this authority will destroy our country."
Yet, the current protests might actually provide hope for Bulgaria's future, as many young Bulgarians expect better from their government and have shown that they intend to do something about it. The dissolution of the new government could prove a crucial starting point of the next chapter in the country's history.
Dave Kranzler of the GoldenTruth gives his expert opinion on the farcical numbers:
(Dave from Denver/the GoldenTruth)
FRIDAY, JULY 5, 2013
The Government's Numbers Are A Complete Farce - Part Time Jobs +322k, Full-time down 240k
[Please note: the S&P 500 futures have plunged 26 pts from their intra-day high, the Dow briefly went red after opening up over 100 points. This fact confirms my analysis below]
In fact, our entire system is a joke. I see where it's being reported that the "inquiry" into Steven Cohen's insider trading will take years. That tells me everything I need to know: the rogue billionaire hedge fund trader has all the right people in all the right places paid off handsomely.
As for today's employment report, to say I'm nearly speechless over how just absurd it is would be nothing more than social correctness. I hope everyone takes note that 322k of the supposed jobs created were part-time - full-time jobs declined by 240k. I'm not going to take the time to dissect the entire report - you can go to Zerohedge.com for that. It's really a waste of time to try and analyze fraud. But here's my thoughts:
Today's jobs report featured 322k increase in part-time jobs. That would be in the services industry. The same services segment of the economy for which the Institute of Supply Management announced on Wednesday that its employment index plunged to its 2009 level: LINK
Who's right? The Govt bean counters or the businesses who do the actual hiring? I'll let you decide.
Please note that new orders per the ISM report plunged to 2008 levels.
Also please note that while the Govt released a number than enables the momentum traders to juice the SPX and hit the metals today, the Govt also made sure that the unemployment rate stayed comfortably above the 7% level and it was actually a bit higher than expected. The 7% level being the number everyone on CNBC is watching to decide if the Fed will really "taper."
Also note that overnight last night that India and Viet Nam were aggressively buying despite Govt attempts in both countries to curb gold buying.
Let the boys have their fun today with the low volume in all the markets and not many players around, now that the rest of the world has left for the weekend except our British lapdogs. And in a couple hours the Brits will go to their kennels for the weekend.
Next week and over the rest of the summer, it's going to become harder for the Government to lie about what's really going on the economy as the evidences of the truth will become more apparent to everyone.
A great article from Dr Paul Craig Roberts:
(courtesy Dr Roberts)
Has Washington’s Arrogance Undone Its Empire? — Paul Craig Roberts
Has Washington’s Arrogance Undone Its Empire?
Paul Craig Roberts
No one likes a bully, and Washington’s NATO puppets have been bullied for six decades. British prime ministers, German chancellors, and French presidents have to salute and say “yes sir.”
They all hate it, but they love Washington’s money; so they prostitute themselves and their countries for Washington’s money. Even a person of Winston Churchill’s stature had to suck up to Washington in order to get his bills and his country’s bills paid.
But what the bought European leaders are finding is that Washington doesn’t pay enough for the prostitution required. One year out of office Tony Blair was worth $35 million dollars. But that’s not enough to get Blair on the waiting list for $50 million 200 foot yachts, to have a chalet in Gstaad, $50 million penthouses in Paris and New York, and a private plane to fly between them, or to wear a $736,000 Franck Muller watch on his wrist, sign his name with a $700,000 Mont Blanc jewel-encrusted pen, and drink $10,000 “martinis on a rock” (gin or vodka poured over a diamond) at New York’s Algonquin Hotel.
In a world in which every member of the Forbes Four Hundred is a billionaire plus or multi-billionaire, $35,000,000 just doesn’t cut it. In 2006 the manager of one hedge fund was paid $1,700,000,000 for one year’s thieving. Another 25 were paid $575,000,000 for their skills in front-running trades. $35 million is probably the annual budget for their household servants.
The British seem content in their role as Washington’s favorite lackey, but France and Germany have not enjoyed that role. France’s last real leader, General de Gaulle, would have nothing to do with it and refused to join NATO. Germany, dismembered with East Germany occupied by the Soviets, had no choice. Germans’ gratitude to President Reagan for their unification resulted in re-unified Germany falling under Washington’s hegemony.
However, if news reports from Berlin are true, Germany has had enough. The catalyst was Edward Snowden’s revelations that Washington spies on everyone including its allies, both Germany and the EU in particular. Moreover, Washington uses Britain as the Trojan Horse within the EU as a backup spy in case NSA misses something.
According to news reports, the German, French, and EU governments are upset to find out that their extreme subservience to Washington has not protected them and their citizens from being spied upon. Here they are, fighting Washington’s wars in far distant Afghanistan, the fate of which is completely unrelated to their own, and what does Washington do but embarrass them by spying on the personal lives of their citizens.
Who does the Merkel government represent, Germans are asking, Germans or the NSA? Why does the Merkel government kowtow to Washington? The next question will be: “what does Washington’s spies have on Merkel?”
With the German government put on the spot by Washington’s betrayal, news headlines are: “Germany Ready to Charge UK and US Intelligence Over Bugging Operations.”
Little wonder Washington and its media whores hate Edward Snowden. “A spokesman for the [German] Federal Prosecutor said the office was preparing to bring charges against” the UK and US intelligence services. In light of the Snowden affair, it will be wonderful if Germany issues arrest warrants and Washington and London refuse to extradite its NSA and UK spy operatives who have violated every law and every trust.
The German Justice Minister, Sabine Leutheusser-Schnarrenburger, demanded an “immediate explanation” why Washington was applying to Germany policies “reminiscent of the actions against enemies during the Cold War.”
The president of France has said that France will not again cooperate with Washington on any issue until France receives “full assurances” that Washington will cease spying on France.
The president of the European Parliament, Martin Schulz, and the EU Commissioner for Justice, Viviane Reding, demand Washington’s answer to Snowden’s revelations that Washington has betrayed its own allies.
The question that must be asked is: do any of these protests from politicians who are
almost certain to be on Washington’s payroll mean anything, or are they just make-believe protests to quiet the domestic European populations who have been betrayed by their elected leaders? Why would the French president and the German justice minister think any reassurance from Washington meant anything? When in human memory has Washington told the truth about anything? When has Washington’s reassurance meant anything?
The Tonkin Gulf? Iraqi weapons of mass destruction? Iranian nukes? Assad’s sarin gas attack? FBI orchestrated “terror attacks”? It is a proven fact that the US government lies every time it opens its mouth. Compared to Washington, Stalin, Hitler, Tojo, Mao, Castro, Chavez, and Pol Pot were truthful.
Washington’s reply to Europe’s demands for explanation is: “We will discuss these issues bilaterally with EU member states,” but “we are not going to comment publicly on specific alleged intelligence activities.”
You know what that means. Bilateral means that Washington is going to talk with each EU country separately, using the information NSA has obtained to blackmail each complainant into silence. Whereas the EU together could stand up to Washington, separately the countries can be browbeat and offered more money or threats that illicit love affairs will be revealed to shut them up. Washington is betting on its power to intimidate individual countries with the threat of isolation and being cut off from money. If the EU countries agree to the secret bilateral explanations from Washington, the affair will end and the spying on Europe will continue while Washington and the EU politicians deny that the spying continues.
By now the entire world must know that Washington is not merely lawless, but also totally out of control, reveling in arrogance and hubris, driven by desires for hegemony over the entire world. Washington is so paranoid and distrustful that it doesn’t even trust its own citizens or the European puppet governments that it has bought and paid for.
Washington is the only government that has ever used nuclear weapons, and Washington used them against a defeated government that was trying to surrender. Today the craziness in Washington is much worse. Decision-making councils are full of crazed neoconservative war-mongers, such as National Security Advisor Susan Rice, a threat to humanity. Washington think tanks and media are over-represented by neoconservatives such as William Kristol who wants to know “what good are nuclear weapons if you can’t use them?”
The sleazy European politicians and media who took Washington’s money provided for their own economic security, but they betrayed the security of the entire world. By enabling Washington’s hegemony, they unleashed Washington’s arrogance. This arrogance now threatens not merely the independence of every country but life on earth.
Instead of meeting unilaterally alone with Washington, the European countries should
stand together. After all, supposedly there is an EU. If there is an EU, Washington should meet with the EU, not with its constituent parts individually, no one of which can stand up to Washington’s intimidation and bribes.
If thermo-nuclear war is to be avoided and life is to continue on earth, Europe must disband NATO. The North Atlantic Treaty Organization was formed in the aftermath of World War II. Its purpose was to prevent the powerful Red Army, which defeated Nazi Germany, from overrunning all of Western Europe.
The Soviet Union collapsed in 1991, 22 years ago. Yet, NATO still exists. Moreover, against President Reagan’s intentions, NATO has grown. NATO now includes former constituent parts of the Soviet Empire, such as Eastern Europe, and former constituent parts of the Soviet Union itself, such as Georgia, the government of which is bought and paid for by Washington. The NGOs that Washington funds might even deliver Ukraine into Washington’s fold.
Egged on by Washington, Georgia initiated a war with present day Russia, which superior Russian forces quickly ended. In the opinion of many, the Russian government showed far too much tolerance for its defeated enemy, which is being rearmed by Washington and encouraged into new military adventures. Washington is working to make Georgia, located in Asia between the Black and Caspian seas, a member of the North Atlantic Treaty Organization. NATO membership would make Georgia a treaty protectorate of Washington and its NATO puppets. Washington thinks that this elevation of Georgia would result in Russia acquiescing to Georgian aggression in order to avoid war with the US and NATO.
China, also, has been amazingly abused by Washington, and instead of replying in kind, has taken it in stride. This magnanimity on the part of the Chinese has been misinterpreted by Washington as fear. The fear that Washington imagines is causing China to quake in its boots has encouraged Washington to surround China with new naval, air, and troop bases. The fact that however numerous are Washington’s bases in the Pacific and South China Sea, Washington itself is an ICBM away has not registered on the ignorant scum that rules Amerika. Overwhelmed by its hubris, Washington threatens all life on earth.
And Ed Steer's Report ......
http://www.caseyresearch.com/gsd/edition/ted-butler-the-new-law-of-supply-and-demand
¤ YESTERDAY IN GOLD & SILVER
With the U.S. closed on their Thursday, the gold price didn't do much. All that changed shortly after trading began in the Far East on their Friday morning...and by the 10:30 a.m. BST morning gold fix in London, the gold price was down twenty bucks from Tuesday's 5:15 p.m. EDT electronic close. From that low, gold rallied a bit until 8:30 a.m. in New York.
Then the jobs report came out...and someone hit the buy the dollar/sell gold button. The U.S. bond market got crushed as well.
The low tick of the day [$1,207.50 spot] came at the London p.m. gold fix at 3:00 p.m. BST...10:00 a.m. in New York.
The gold price recovered a bit from there, but then traded sideways from the London close until around 3:30 p.m. EDT. From there it rallied a few dollars into the close.
Gold finished the day on Friday at $1,223.80 spot...down $28.70 from Tuesday's close in New York. Net volume was a hair under 200,000 contracts...and that figure includes Thursday's volume as well.
It was pretty much the same chart pattern in silver, although it got hit much harder than gold did. But as you know by now, dear reader, this is JPMorgan's problem child...and they're obviously still chipping away at what's left of their grotesque short position in this metal.
The only difference between gold and silver's price pattern was the low tick in silver [$18.63 spot] came about 10:45 a.m. EDT...fifteen minutes before the London close...and not at the p.m. gold fix.
Silver finished the Friday session at $18.90 spot...down 82 cents from Tuesday. Silver's gross volumeon Thursday and Friday totaled 59,500 contracts.
The platinum and palladium charts look somewhat similar, although palladium's recovery was the most impressive of all four precious metals. Here are the charts...
Over the two days, gold closed down 2.29%...silver got clubbed for 4.16%...platinum closed lower by 1.42%...and palladium was down only 0.29%.
The dollar index closed on Tuesday at 83.24...and closed yesterday at 84.44...up 120 basis points, the gains just about evenly split between Thursday and Friday. With New York closed on Thursday, there was very little reaction by the precious metals to the 60 basis point rise in the index on that day. That situation was rectified yesterday.
Because of the holiday-shortened week, the CME's Daily Delivery Report wasn't much to see yesterday, as zero gold and 17 silver contracts were posted for delivery on Tuesday within the Comex-approved depositories. The link to yesterday's Issuers and Stoppers Report is here.
Like it has been all week...GLD went in one direction...and SLV went in the other on Friday. InGLD, an authorized participant withdrew 86,967 troy ounces...but in SLV an authorized participant[s] deposited a very chunky 2,894,736 troy ounces. During the first week of July just past, there have been withdrawals form GLD totaling 241,584 troy ounces. But in SLV for the week that was...4,680,551 troy ounces of silver have been deposited. If you're looking for a reason for this dichotomy...I don't have any answers for you.
Over at Switzerland's Zürcher Kantonalbank, they reported big sell offs in both their gold and silver ETFs for the week ending June 28th. In their gold ETF, it was 382,233 troy ounces...and in their silver ETF it was a very large 2,104,775 troy ounces. These are the biggest one-week sell offs in these two funds that I can remember...and one has to wonder who the new owners of all this metal are. I would guess that it's a bullion bank of some sort.
There was no sales report from the U.S. Mint again yesterday.
Over at the Comex-approved depositories on Wednesday, they didn't report receiving anysilver, but they did ship 560,847 troy ounces out the door. The link to that action is here.
In gold, these same depositories reported receiving 36,121 troy ounces...but they shipped out a chunky 152,057 troy ounces. The link to that activity is here.
As I've mentioned in every column this week...because of the U.S. holiday on Thursday, the COT Report and the Bank Participation Report won't be out until Monday...and I'll report on both in my Tuesday column.
I have two days' worth of stories...and despite taking an axe to the list, there are still a lot left, so the final edit is yours.
* * *
non redundant news and views.......
Doug Noland: Mispricing Risk
Bonds taken out to the woodshed, again.
U.S. bonds were crushed Friday on the back of stronger-than-expected payroll data. Long-bond yields jumped 21 bps to an almost 23-month high 3.71%. Ten-year yields rose 24 bps to 2.74% - the highest yields since August 5, 2011. Benchmark MBS yields surged 30 bps during the session to a 23-month high 3.69%. The spread between 10-year Treasury yields and benchmark MBS widened six on Friday to a one-year high 95 bps. Notably, MBS yields were up 75 bps in 14 sessions and 140 bps since May 1st.
"With unprecedented outflows from the bond complex coupled with notable global central bank selling, the Bubble in U.S. fixed income would appear in serious jeopardy. And while analysts and money managers will continue talk of a “fair value” range for Treasury securities, for the time being flow of funds analysis trumps valuation. Will foreign central banks continue reducing their enormous holdings of U.S. Treasury and Agency securities? How much leverage has accumulated throughout U.S. fixed income – especially in corporates, MBS and municipal debt? How long until some hedge funds are in trouble? Redemptions coming? Derivative problems? Will investors continue their retreat from U.S. fixed income mutual funds and ETFs?
"As noted in my “Issues 2013” CBB from early January: A market Bubble implies bipolar outcome possibilities. Either the entrenched Bubble bursts or it becomes an issue of “how crazy do things get?” If the U.S. stock market has evolved into the speculative Bubble of choice, there are a couple things the Fed might contemplate. First, QE may now work to spur similar late-cycle speculative excesses that are now coming home to roost throughout the fixed income universe. Second, inflating stock prices may work to pull additional liquidity away from an already liquidity-challenged bond market. It is, after all, the nature of liquidity to seek the inflating asset market."
Doug's Credit Bubble Bulletin from yesterday...always a must read for me.
Toronto Reviews Bid to Become Yuan Currency Trading Hub
Some of Canada’s largest banks, insurance companies and pension funds met with government representatives and the Bank of Canada in Toronto on June 21 to discuss establishing a yuan trading hub, according to the Toronto Financial Services Alliance, an industry group that set up the meeting.
Representatives of Chinese banks also attended the meeting, the group said, declining to name them. “There’s been expressions of interest from some companies,” said Janet Ecker, president of the finance group, who attended the meeting. “We’ve seen what’s happened in London and Singapore and Hong Kong.”
This Bloomberg story, filed from Toronto, was posted on their website early yesterday morning MDT...and it's courtesy of reader 'David in California'.
QEternity for Europe and U.K.
President Mario Draghi said the European Central Bank expects to keep interest rates low for an "extended period" as he tries to restrain market borrowing costs, in a new departure for an institution averse to setting policy in advance.
With ECB officials today leaving their main refinancing rate at 0.5 percent, Draghi fleshed out their outlook for monetary policy after investors pushed up long-term bond yields, threatening the region's economic recovery. The statement came on the same day that the Bank of England also tried to manage investor expectations in Mark Carney's first week as governor.
"The Governing Council expects the key ECB interest rates to remain at present or lower levels for an extended period of time," Draghi said at a press conference in Frankfurt. "What the Governing Council did today was to inject a downward bias in interest rates for the foreseeable future. Our exit is very distant."
This is another Bloomberg story, this one posted on their Internet site early on Thursday morning MDT...and I found it in a GATA release. It's definitely worth reading.
EU Parliament Urges Blocking US Data Access After Spy Leaks
The European Parliament called on Thursday for the scrapping of two agreements granting the United States access to European financial and travel data unless Washington reveals the extent of its electronic spying operations in Europe.
A non-binding resolution, passed by 483 votes to 98 with 65 abstentions, said the United States should come clean about its surveillance of email and communications data or risk seeing the transatlantic information-sharing deals, created in the wake of the September 11 attacks, torn up.
The parliament cannot revoke the agreements without the support of European Union governments and the bloc's executive Commission, which looks unlikely.
This is all for show...and public consumption. Absolutely nothing will change. This Reuters article, filed from Brussels on Wednesday, is courtesy of Manitoba reader Ulrike Marx.
Lawlessness Is the New Normal — Paul Craig Roberts
In various articles and in my latest book, The Failure of Laissez Faire Capitalism And Economic Dissolution Of The West, I have pointed out that the European sovereign debt crisis is being used to terminate the sovereignty of the countries that are members of the EU. There is no doubt that this is true, but the sovereignty of the EU member states is only nominal. Although the individual countries still retain some sovereignty from the EU government, they are all under Washington’s thumb, as demonstrated by the recent illegal and hostile action taken on Washington’s orders by France, Italy, Spain, Portugal, and Austria against the airliner carrying Bolivia’s President Evo Morales.
Flying back to Bolivia from Moscow, Morales’ plane was denied over flight and refueling permission by Washington’s French, Italian, Spanish, and Portuguese puppets and had to land in Austria, where the presidential plane was searched for Edward Snowden. It was a power play by Washington to kidnap Snowden from Bolivia’s presidential airliner in defiance of international law and to teach upstart reformers like Morales that independence from Washington’s orders is not permitted.
The European puppet states went along with this extraordinary breach of diplomacy and international law despite the fact that each of the countries is incensed that Washington is spying on their governments, diplomats, and citizens. Their thanks to Snowden, whose revelations made them aware that Washington was recording their every communication, was to help Washington capture Snowden.
This tells us how much morality, honor, integrity there is left in Western civilization: Zero.
This must read commentary was posted on Paul's website yesterday...and is probably one of the most important items in today's column. I thank Ulrike Marx for bringing it to my attention...and now to yours.
Argentina Applies Law That Jails Hoarders as Bread Surges
Argentina plans to apply a law that forces holders of wheat and flour suitable for bread making to sell stock on the domestic market in a bid to contain inflation.
Interior Commerce Secretary Guillermo Moreno announced the measure in the official gazette today. The 1974 law allows authorities to freeze prices and obliges companies to maintain supply. Those in breach are subject to fines and imprisonment.
“If the law on supply is applied, the one who should go to jail is Moreno himself,” former Economy Minister Martin Lousteau said in an interview with Radio Mitre today. “He’s to blame for the lack of wheat in Argentina.”
This Bloomberg article was filed from Buenos Aires...and posted on their Internet site late yesterday morning MDT. It's the second offering in today's column from reader 'David in California'.
Egypt's Cunning General: How the Military Plans to Keep Power
Adly Mansour's rise to power has been a rapid one. On Monday, the career judge was sworn in as chief justice of Egypt's Supreme Constitutional Court. ByWednesday night, President Mohammed Morsi had been deposed, the constitution suspended, and Mansour was declared the country's new interim leader, set to be sworn in on Thursday. Along with a cabinet of technocrats, he'll govern the country until new elections.
But no one knows if and when these elections might take place. And Mansour won't be Egypt's most important man, even if the justice, who served in the country's top court under deposed autocrat Hosni Mubarak, now calls himself head of state. That's because behind the scenes, the military, led by General Abdel-Fattah el-Sissi, plans to continue running the show.
Since it took power in a coup in 1952, the military has remained the most important political player in Egypt. Neither Mubarak's fall in 2011, nor the short rule by Morsi, a member of the Muslim Brotherhood, have changed this. El-Sissi demonstrated just how powerful the influence of the military's generals is on Wednesday night, when, after giving Morsi 48 hours to leave office, he summarily informed the president that he was no longer the leader of the country. No matter that Morsi was the country's first democratically elected head of state.
This story appeared on the German website spiegel.de late Thursday morning Europe time...and I thank Roy Stephens once again.
It Is Now Common Knowledge That US Drones Bomb Civilian Rescuers
Taliban commanders and security officials told Reuters that the strike mostly killed fighters for the Haqqani network.
Many were wounded in the attack, local tribesman Kaleemullah Dawar said, but rescuers delayed for fear of falling victim to a second attack, a common tactic with drone strikes. That tactic is known as the "double tap," which bombs multiple targets in relatively quick succession — meaning that the second strike often hits first responders.
The NYU/Stanford report stated: "As international law experts have noted, intentional strikes on first responders may constitute war crimes." The fact that it is now normalized as a common tactic of the U.S. drone war is stunning.
This story also from the businessinsider.com Internet site on Wednesday...and another article that I've saved for Saturday. It's a must read for all serious students of the New Great Game...and it represents Roy Stephens' final offering in today's column.
China Signals Will Cut Off Credit to Rebalance Economy
In a statement from the State Council, or cabinet, Beijing laid out broad plans to ensure banks support the kind of economic rebalancing China's new leadership wants as it looks to focus more on high-end manufacturing.
President Xi Jinping and Premier Li Keqiang have flagged for some time that the rapid growth of the past three decades needs to shift down a gear, and analysts said Friday's announcement was a signal that they intended to press on with reforms despite evidence of a sharper-than-expected slowdown.
"The guideline shows China's policymakers will focus more on economic restructuring to stabilize the economy rather than providing more liquidity to support economic growth," said Li Huiyong, an economist at Shenyin Wanguo Securities in Shanghai.
This Reuters story, filed from Beijing, was posted on their website early yesterday morning EDT...and I thank Ulrike Marx for another contribution to today's column.
Six King World News Blogs
1. Citi analyst Tom Fitzpatrick: "4 Absolutely Spectacular Gold Charts and Commentary". 2. John Williams: "We Are Beginning to Approach the End Game". 3. Dr. Benn Steil: "Gold, Financial War and the Fed's Dangerous Exit Strategy". 4. Dr. Marc Faber: "This Will End in Disaster". 5. Egon von Greyerz: "Gold and Silver Smash and Fires Burning Everywhere in the World". 6. Dr. Stephen Leeb: "Gold and a Global Financial System in Complete Turmoil".
The Smart Money Is Quietly Buying More Gold
There are also some seriously credible professionals currently buying, albeit quietly. One is Sebastian Lyon, the fund manager overseeing Personal Assets Trust, a unique, quoted £600m investment fund whose overriding aim is to preserve shareholders' capital.
The board of Personal Assets is so hell-bent on its cautious, wealth-preserving tack that it boasts about having missed stock market rallies. In its own words, it is a "tiresome holding for lovers of excitement and adventure, who will find it unbearable to see us sitting on the sidelines while the FTSE climbs tantalisingly to its peak".
Personal Assets Trust's excellent performance during the worst of the crisis was largely due to its big investment in bullion – currently more than 12pc of its portfolio. In recent months, as the price has fallen, Mr. Lyon has topped up gold holdings. That someone who follows such a cautious mandate, and has done so with such success, is today a buyer of gold is worth noting.
This commentary showed up on the telegraph.co.uk Internet site early yesterday evening BST...and it's worth skimming. I thank reader 'Roger B' for sending it our way.
Gold Jewellery Stocks Hammered in India
Gold jewellery stocks are in a free-fall in India. The curbs imposed by the Indian government and the Reserve Bank of India to curtail domestic gold consumption and imports, has led to a hammering of stock prices. Some leading jewellers shares have dived by 20% to 50% during the past fortnight.
Analysts attribute the mayhem to the fact that most gold retailers in India hold huge inventories of gold. Since the price of gold has slid in the international market, this has resulted in a huge depreciation in the value of the gold inventory held by bullion companies.
Shares of Gitanjali Gems, touted as India’s largest gold and jewellery company, have slumped more than 60% since mid-June with investors preferring to bail out even on July 4.
This interesting story, filed from Mumbai, was posted on the mineweb.comInternet site on Thursday...and my thanks go out to Ulrike Marx for passing it along.
Credit Card Transactions for Gold Purchases Curtailed in India
Buying gold in India has got a little more difficult for consumers used to using plastic money to buy large jewellery sets or heavy gold ornaments. India's apex bank has asked banks not to convert gold purchases done through credit cards into equated monthly installments.
Continuing its fight against gold consumption, the Reserve Bank of India is leaving no stone unturned to discourage gold buyers in India. The ban on conversion of gold purchases at jewellery stores into equated monthly instalments for credit card purchases has already triggered a slump in sales.
"The central bank has asked banks to stop accepting credit card purchases for gold. We only realised this when customers who fished out their credit card for high value transactions at our stores could not carry through the order. In the last 48 hours, sales have dipped over 25%," said Manmohan Gandhi, bullion retailer.
This is another story posted on the mineweb.com Internet site. This one was filed from Mumbai yesterday...and I thank Ulrike Marx for her final offering in today's column.
¤ THE WRAP
Irrespective of the sharp decline in the price of gold, physical gold—held for the long term—remains the primary hedge against the U.S. dollar debasement ahead. Yet, it has to be in place, and it has to be held through the developing crises—irrespective of short-term market volatility—in order to provide the desired asset protection. Whether gold is purchased at $250, $2,500 or $25,000 per ounce, it preserves the purchasing power of the dollars invested. Someone looking to take profits at $100,000 an ounce is missing what has happened. Those “profits” are just the preserved purchasing power of the invested dollars. - John Williams...shadowstats.com...3
That's it for the day...and the week...and I'll see you here on Tuesday.
- Bank of England
- Central Banks
- European Central Bank
- France
- Germany
- Ireland
- Italy
- Portugal
- Real estate
- Reality
Via Mark J. Grant, author of Out of the Box,
“Always remember, your focus determines your reality.”
-George Lucas
Our reality has changed in the last twenty-four hours. The Bank of England and the European Central Bank have re-affirmed their old positions since the Fed has changed tacks. The initial reactions will be a spike in equities and a fall-off in the valuations of the Pound and the Euro to the Dollar. These, however, are first blush reactions as the color fades from the bloom.
It may well be, as Europe is in much worse financial condition than the United States, that there is a policy reason for the European positions but it may well also be a calculated move to devalue the major European currencies. Whatever the actual reasons, the European statements have certainly sounded the trumpet that the “Currency Wars” have reignited.
The impact of the Euro/Dollar at 1.25 and then 1.20 will be a positive for Europe as exports rise and a negative for America as exports fall and imports rise. The sword could be double edged though as the Fed, in response, begins to cull back on the more than $1 trillion that it has lent to the European banks. Many truths will be shrouded in mystery but the impact will be there regardless.
It is a dangerous game when the world’s central banks that have been working for the last five years in unison and now they head down different paths. You may expect tears at the seams and various ripping sounds as Europe moves away from the Fed. Mr. Carney and Mr. Draghi have buddied up while poor Ben is left to wander alone.
The trumpets that had heralded “The Three Kings” now sound just for two and the drums that have beat in unison now will sound a disconnected harmony. America has gone left and Europe has gone right and there will be consequences for both.
I mention one other thing this morning that is surely coming and it will be the hammering of the gong. The ECB has massive securitizations that are being carried at par (100 cents on the Dollar) at the ECB and at the European banks. The losses, with many tied to Real Estate, must be staggering. There will be a time, a moment, after “extend and pretend” runs out when these losses must be faced. These securitizations are guaranteed, in the case of Spain as one example, by the sovereign ($51.6 billion in the case of Spain). Others, I have heard, are guaranteed by the major European banks. The poorer nations in Europe will want the ECB to take the hits, shared losses, but Germany will vehemently object.
France, Italy, Spain, Portugal and Ireland cannot afford the losses. The hits would bankrupt or severely impair most of the European banks. The clock is running and midnight will be approaching sometime during the next twelve months.
I fear what we don’t know and what is hidden. Realization will eventually arrive because it must. A very unpleasant reality will surface. When you shout and scream and make false claims that the money is in the drawer the day will arrive, because you need the money, that you open the drawer and it is not there. That day is one of reckoning. The Europeans will not enjoy it!
-George Lucas
Our reality has changed in the last twenty-four hours. The Bank of England and the European Central Bank have re-affirmed their old positions since the Fed has changed tacks. The initial reactions will be a spike in equities and a fall-off in the valuations of the Pound and the Euro to the Dollar. These, however, are first blush reactions as the color fades from the bloom.
It may well be, as Europe is in much worse financial condition than the United States, that there is a policy reason for the European positions but it may well also be a calculated move to devalue the major European currencies. Whatever the actual reasons, the European statements have certainly sounded the trumpet that the “Currency Wars” have reignited.
The impact of the Euro/Dollar at 1.25 and then 1.20 will be a positive for Europe as exports rise and a negative for America as exports fall and imports rise. The sword could be double edged though as the Fed, in response, begins to cull back on the more than $1 trillion that it has lent to the European banks. Many truths will be shrouded in mystery but the impact will be there regardless.
It is a dangerous game when the world’s central banks that have been working for the last five years in unison and now they head down different paths. You may expect tears at the seams and various ripping sounds as Europe moves away from the Fed. Mr. Carney and Mr. Draghi have buddied up while poor Ben is left to wander alone.
The trumpets that had heralded “The Three Kings” now sound just for two and the drums that have beat in unison now will sound a disconnected harmony. America has gone left and Europe has gone right and there will be consequences for both.
I mention one other thing this morning that is surely coming and it will be the hammering of the gong. The ECB has massive securitizations that are being carried at par (100 cents on the Dollar) at the ECB and at the European banks. The losses, with many tied to Real Estate, must be staggering. There will be a time, a moment, after “extend and pretend” runs out when these losses must be faced. These securitizations are guaranteed, in the case of Spain as one example, by the sovereign ($51.6 billion in the case of Spain). Others, I have heard, are guaranteed by the major European banks. The poorer nations in Europe will want the ECB to take the hits, shared losses, but Germany will vehemently object.
France, Italy, Spain, Portugal and Ireland cannot afford the losses. The hits would bankrupt or severely impair most of the European banks. The clock is running and midnight will be approaching sometime during the next twelve months.
I fear what we don’t know and what is hidden. Realization will eventually arrive because it must. A very unpleasant reality will surface. When you shout and scream and make false claims that the money is in the drawer the day will arrive, because you need the money, that you open the drawer and it is not there. That day is one of reckoning. The Europeans will not enjoy it!
Protests Sweep Bulgaria As Government Collapses Amid Chaos
Protests Sweep Bulgaria As Government Collapses Amid Chaos
The Bulgarian government was officially dissolved on Wednesday with the resignation of Prime Minister Boiko Borisov as thousands took to the street to protest against high electricity bills and declining living standards. The country, which joined the EU in 2001, remains the poorest member of the union after a long and troubled transition to capitalism.
The first casualty of the on-going crisis became Bulgarian finance minister Simeon Djankov — a well-respected former World Bank official who undertook painful economic reforms and austerity measures. Djankov stepped down on Tuesday in the middle of escalating protests in the capital of Sofia where people with signs that read "Mafia" and "Bring Down the Monopolies" were rallying against lack of transparency and monopolistic practices in the energy sector.
As the nationwide protest steadily turned against "Everything and Everyone," violent clashes with the police errupted leaving at least 25 injured in Sofia which increased the pressure on Borisov's leadership three months before the official end of his term.
Borisov, known for his hard-line can-do style, has successfully carried out ambitious infrastructure projects and EU programs. However, rising unemployment and soaring living costs have put millions of Bulgarians on the brink of poverty in a country where the average monthly salary continues to be less than 400 euros a month.
In a surprise move on Wednesday Prime Minister Borisov officially announced his resignation, saying, "I am unable to witness the blood on the streets. The people put us in power and today we give it back to them." His centrist GERB party will not participate in the formation of a new government which leaves many open questions about the political stability of the country.
Bulgarian President Rosen Plevneliev addressed the nation and announced his efforts to put together an interim government until the elections can be held this spring.
Despite the cabinet resignation the violent clashes in Sofia have intensified late on Wednesday as protesters demand the exit of the entire political establishment.
A 36-year-old man set himself on fire in the city of Varna where protests are demanding Mayor Kiril Yordanov's resignation. Yordanov is currently serving his fourth consecutive term and has held the post since 1999.
Lack of fresh ideas and alternatives have paralyzed the aging and complacent political class of Bulgaria. More than three million Bulgarians, which accounts for close to 40% of the total population, have left the country since the fall of communism in search of better education and job opportunities.
Those who have remained in the country have steadily seen their post-communism dreams disappear in corruption, political scandals and rising unemployment among young people.
Similar protests have been sparked in Slovenia where the government is struggling to remain in power. One protester, Miha Borovovec, said, "This government is totalitarian, it is corrupt, it is taking our country down. That’s why I am here; this authority will destroy our country."
Yet, the current protests might actually provide hope for Bulgaria's future, as many young Bulgarians expect better from their government and have shown that they intend to do something about it. The dissolution of the new government could prove a crucial starting point of the next chapter in the country's history.
Dave Kranzler of the GoldenTruth gives his expert opinion on the farcical numbers:
(Dave from Denver/the GoldenTruth)
FRIDAY, JULY 5, 2013
The Government's Numbers Are A Complete Farce - Part Time Jobs +322k, Full-time down 240k
[Please note: the S&P 500 futures have plunged 26 pts from their intra-day high, the Dow briefly went red after opening up over 100 points. This fact confirms my analysis below]
In fact, our entire system is a joke. I see where it's being reported that the "inquiry" into Steven Cohen's insider trading will take years. That tells me everything I need to know: the rogue billionaire hedge fund trader has all the right people in all the right places paid off handsomely.
As for today's employment report, to say I'm nearly speechless over how just absurd it is would be nothing more than social correctness. I hope everyone takes note that 322k of the supposed jobs created were part-time - full-time jobs declined by 240k. I'm not going to take the time to dissect the entire report - you can go to Zerohedge.com for that. It's really a waste of time to try and analyze fraud. But here's my thoughts:
Today's jobs report featured 322k increase in part-time jobs. That would be in the services industry. The same services segment of the economy for which the Institute of Supply Management announced on Wednesday that its employment index plunged to its 2009 level: LINK
Who's right? The Govt bean counters or the businesses who do the actual hiring? I'll let you decide.
Please note that new orders per the ISM report plunged to 2008 levels.
Also please note that while the Govt released a number than enables the momentum traders to juice the SPX and hit the metals today, the Govt also made sure that the unemployment rate stayed comfortably above the 7% level and it was actually a bit higher than expected. The 7% level being the number everyone on CNBC is watching to decide if the Fed will really "taper."
Also note that overnight last night that India and Viet Nam were aggressively buying despite Govt attempts in both countries to curb gold buying.
Let the boys have their fun today with the low volume in all the markets and not many players around, now that the rest of the world has left for the weekend except our British lapdogs. And in a couple hours the Brits will go to their kennels for the weekend.
Next week and over the rest of the summer, it's going to become harder for the Government to lie about what's really going on the economy as the evidences of the truth will become more apparent to everyone.
A great article from Dr Paul Craig Roberts:
(courtesy Dr Roberts)
Has Washington’s Arrogance Undone Its Empire? — Paul Craig Roberts
Has Washington’s Arrogance Undone Its Empire?
Paul Craig Roberts
No one likes a bully, and Washington’s NATO puppets have been bullied for six decades. British prime ministers, German chancellors, and French presidents have to salute and say “yes sir.”
They all hate it, but they love Washington’s money; so they prostitute themselves and their countries for Washington’s money. Even a person of Winston Churchill’s stature had to suck up to Washington in order to get his bills and his country’s bills paid.
But what the bought European leaders are finding is that Washington doesn’t pay enough for the prostitution required. One year out of office Tony Blair was worth $35 million dollars. But that’s not enough to get Blair on the waiting list for $50 million 200 foot yachts, to have a chalet in Gstaad, $50 million penthouses in Paris and New York, and a private plane to fly between them, or to wear a $736,000 Franck Muller watch on his wrist, sign his name with a $700,000 Mont Blanc jewel-encrusted pen, and drink $10,000 “martinis on a rock” (gin or vodka poured over a diamond) at New York’s Algonquin Hotel.
In a world in which every member of the Forbes Four Hundred is a billionaire plus or multi-billionaire, $35,000,000 just doesn’t cut it. In 2006 the manager of one hedge fund was paid $1,700,000,000 for one year’s thieving. Another 25 were paid $575,000,000 for their skills in front-running trades. $35 million is probably the annual budget for their household servants.
The British seem content in their role as Washington’s favorite lackey, but France and Germany have not enjoyed that role. France’s last real leader, General de Gaulle, would have nothing to do with it and refused to join NATO. Germany, dismembered with East Germany occupied by the Soviets, had no choice. Germans’ gratitude to President Reagan for their unification resulted in re-unified Germany falling under Washington’s hegemony.
However, if news reports from Berlin are true, Germany has had enough. The catalyst was Edward Snowden’s revelations that Washington spies on everyone including its allies, both Germany and the EU in particular. Moreover, Washington uses Britain as the Trojan Horse within the EU as a backup spy in case NSA misses something.
According to news reports, the German, French, and EU governments are upset to find out that their extreme subservience to Washington has not protected them and their citizens from being spied upon. Here they are, fighting Washington’s wars in far distant Afghanistan, the fate of which is completely unrelated to their own, and what does Washington do but embarrass them by spying on the personal lives of their citizens.
Who does the Merkel government represent, Germans are asking, Germans or the NSA? Why does the Merkel government kowtow to Washington? The next question will be: “what does Washington’s spies have on Merkel?”
With the German government put on the spot by Washington’s betrayal, news headlines are: “Germany Ready to Charge UK and US Intelligence Over Bugging Operations.”
Little wonder Washington and its media whores hate Edward Snowden. “A spokesman for the [German] Federal Prosecutor said the office was preparing to bring charges against” the UK and US intelligence services. In light of the Snowden affair, it will be wonderful if Germany issues arrest warrants and Washington and London refuse to extradite its NSA and UK spy operatives who have violated every law and every trust.
The German Justice Minister, Sabine Leutheusser-Schnarrenburger, demanded an “immediate explanation” why Washington was applying to Germany policies “reminiscent of the actions against enemies during the Cold War.”
The president of France has said that France will not again cooperate with Washington on any issue until France receives “full assurances” that Washington will cease spying on France.
The president of the European Parliament, Martin Schulz, and the EU Commissioner for Justice, Viviane Reding, demand Washington’s answer to Snowden’s revelations that Washington has betrayed its own allies.
The question that must be asked is: do any of these protests from politicians who are
almost certain to be on Washington’s payroll mean anything, or are they just make-believe protests to quiet the domestic European populations who have been betrayed by their elected leaders? Why would the French president and the German justice minister think any reassurance from Washington meant anything? When in human memory has Washington told the truth about anything? When has Washington’s reassurance meant anything?
The Tonkin Gulf? Iraqi weapons of mass destruction? Iranian nukes? Assad’s sarin gas attack? FBI orchestrated “terror attacks”? It is a proven fact that the US government lies every time it opens its mouth. Compared to Washington, Stalin, Hitler, Tojo, Mao, Castro, Chavez, and Pol Pot were truthful.
Washington’s reply to Europe’s demands for explanation is: “We will discuss these issues bilaterally with EU member states,” but “we are not going to comment publicly on specific alleged intelligence activities.”
You know what that means. Bilateral means that Washington is going to talk with each EU country separately, using the information NSA has obtained to blackmail each complainant into silence. Whereas the EU together could stand up to Washington, separately the countries can be browbeat and offered more money or threats that illicit love affairs will be revealed to shut them up. Washington is betting on its power to intimidate individual countries with the threat of isolation and being cut off from money. If the EU countries agree to the secret bilateral explanations from Washington, the affair will end and the spying on Europe will continue while Washington and the EU politicians deny that the spying continues.
By now the entire world must know that Washington is not merely lawless, but also totally out of control, reveling in arrogance and hubris, driven by desires for hegemony over the entire world. Washington is so paranoid and distrustful that it doesn’t even trust its own citizens or the European puppet governments that it has bought and paid for.
Washington is the only government that has ever used nuclear weapons, and Washington used them against a defeated government that was trying to surrender. Today the craziness in Washington is much worse. Decision-making councils are full of crazed neoconservative war-mongers, such as National Security Advisor Susan Rice, a threat to humanity. Washington think tanks and media are over-represented by neoconservatives such as William Kristol who wants to know “what good are nuclear weapons if you can’t use them?”
The sleazy European politicians and media who took Washington’s money provided for their own economic security, but they betrayed the security of the entire world. By enabling Washington’s hegemony, they unleashed Washington’s arrogance. This arrogance now threatens not merely the independence of every country but life on earth.
Instead of meeting unilaterally alone with Washington, the European countries should
stand together. After all, supposedly there is an EU. If there is an EU, Washington should meet with the EU, not with its constituent parts individually, no one of which can stand up to Washington’s intimidation and bribes.
If thermo-nuclear war is to be avoided and life is to continue on earth, Europe must disband NATO. The North Atlantic Treaty Organization was formed in the aftermath of World War II. Its purpose was to prevent the powerful Red Army, which defeated Nazi Germany, from overrunning all of Western Europe.
The Soviet Union collapsed in 1991, 22 years ago. Yet, NATO still exists. Moreover, against President Reagan’s intentions, NATO has grown. NATO now includes former constituent parts of the Soviet Empire, such as Eastern Europe, and former constituent parts of the Soviet Union itself, such as Georgia, the government of which is bought and paid for by Washington. The NGOs that Washington funds might even deliver Ukraine into Washington’s fold.
Egged on by Washington, Georgia initiated a war with present day Russia, which superior Russian forces quickly ended. In the opinion of many, the Russian government showed far too much tolerance for its defeated enemy, which is being rearmed by Washington and encouraged into new military adventures. Washington is working to make Georgia, located in Asia between the Black and Caspian seas, a member of the North Atlantic Treaty Organization. NATO membership would make Georgia a treaty protectorate of Washington and its NATO puppets. Washington thinks that this elevation of Georgia would result in Russia acquiescing to Georgian aggression in order to avoid war with the US and NATO.
China, also, has been amazingly abused by Washington, and instead of replying in kind, has taken it in stride. This magnanimity on the part of the Chinese has been misinterpreted by Washington as fear. The fear that Washington imagines is causing China to quake in its boots has encouraged Washington to surround China with new naval, air, and troop bases. The fact that however numerous are Washington’s bases in the Pacific and South China Sea, Washington itself is an ICBM away has not registered on the ignorant scum that rules Amerika. Overwhelmed by its hubris, Washington threatens all life on earth.
And Ed Steer's Report ......
http://www.caseyresearch.com/gsd/edition/ted-butler-the-new-law-of-supply-and-demand
¤ YESTERDAY IN GOLD & SILVER
With the U.S. closed on their Thursday, the gold price didn't do much. All that changed shortly after trading began in the Far East on their Friday morning...and by the 10:30 a.m. BST morning gold fix in London, the gold price was down twenty bucks from Tuesday's 5:15 p.m. EDT electronic close. From that low, gold rallied a bit until 8:30 a.m. in New York.
Then the jobs report came out...and someone hit the buy the dollar/sell gold button. The U.S. bond market got crushed as well.
The low tick of the day [$1,207.50 spot] came at the London p.m. gold fix at 3:00 p.m. BST...10:00 a.m. in New York.
The gold price recovered a bit from there, but then traded sideways from the London close until around 3:30 p.m. EDT. From there it rallied a few dollars into the close.
Gold finished the day on Friday at $1,223.80 spot...down $28.70 from Tuesday's close in New York. Net volume was a hair under 200,000 contracts...and that figure includes Thursday's volume as well.
It was pretty much the same chart pattern in silver, although it got hit much harder than gold did. But as you know by now, dear reader, this is JPMorgan's problem child...and they're obviously still chipping away at what's left of their grotesque short position in this metal.
The only difference between gold and silver's price pattern was the low tick in silver [$18.63 spot] came about 10:45 a.m. EDT...fifteen minutes before the London close...and not at the p.m. gold fix.
Silver finished the Friday session at $18.90 spot...down 82 cents from Tuesday. Silver's gross volumeon Thursday and Friday totaled 59,500 contracts.
The platinum and palladium charts look somewhat similar, although palladium's recovery was the most impressive of all four precious metals. Here are the charts...
Over the two days, gold closed down 2.29%...silver got clubbed for 4.16%...platinum closed lower by 1.42%...and palladium was down only 0.29%.
The dollar index closed on Tuesday at 83.24...and closed yesterday at 84.44...up 120 basis points, the gains just about evenly split between Thursday and Friday. With New York closed on Thursday, there was very little reaction by the precious metals to the 60 basis point rise in the index on that day. That situation was rectified yesterday.
Because of the holiday-shortened week, the CME's Daily Delivery Report wasn't much to see yesterday, as zero gold and 17 silver contracts were posted for delivery on Tuesday within the Comex-approved depositories. The link to yesterday's Issuers and Stoppers Report is here.
Like it has been all week...GLD went in one direction...and SLV went in the other on Friday. InGLD, an authorized participant withdrew 86,967 troy ounces...but in SLV an authorized participant[s] deposited a very chunky 2,894,736 troy ounces. During the first week of July just past, there have been withdrawals form GLD totaling 241,584 troy ounces. But in SLV for the week that was...4,680,551 troy ounces of silver have been deposited. If you're looking for a reason for this dichotomy...I don't have any answers for you.
Over at Switzerland's Zürcher Kantonalbank, they reported big sell offs in both their gold and silver ETFs for the week ending June 28th. In their gold ETF, it was 382,233 troy ounces...and in their silver ETF it was a very large 2,104,775 troy ounces. These are the biggest one-week sell offs in these two funds that I can remember...and one has to wonder who the new owners of all this metal are. I would guess that it's a bullion bank of some sort.
There was no sales report from the U.S. Mint again yesterday.
Over at the Comex-approved depositories on Wednesday, they didn't report receiving anysilver, but they did ship 560,847 troy ounces out the door. The link to that action is here.
In gold, these same depositories reported receiving 36,121 troy ounces...but they shipped out a chunky 152,057 troy ounces. The link to that activity is here.
As I've mentioned in every column this week...because of the U.S. holiday on Thursday, the COT Report and the Bank Participation Report won't be out until Monday...and I'll report on both in my Tuesday column.
I have two days' worth of stories...and despite taking an axe to the list, there are still a lot left, so the final edit is yours.
* * *
non redundant news and views.......
Doug Noland: Mispricing Risk
Bonds taken out to the woodshed, again.
U.S. bonds were crushed Friday on the back of stronger-than-expected payroll data. Long-bond yields jumped 21 bps to an almost 23-month high 3.71%. Ten-year yields rose 24 bps to 2.74% - the highest yields since August 5, 2011. Benchmark MBS yields surged 30 bps during the session to a 23-month high 3.69%. The spread between 10-year Treasury yields and benchmark MBS widened six on Friday to a one-year high 95 bps. Notably, MBS yields were up 75 bps in 14 sessions and 140 bps since May 1st.
"With unprecedented outflows from the bond complex coupled with notable global central bank selling, the Bubble in U.S. fixed income would appear in serious jeopardy. And while analysts and money managers will continue talk of a “fair value” range for Treasury securities, for the time being flow of funds analysis trumps valuation. Will foreign central banks continue reducing their enormous holdings of U.S. Treasury and Agency securities? How much leverage has accumulated throughout U.S. fixed income – especially in corporates, MBS and municipal debt? How long until some hedge funds are in trouble? Redemptions coming? Derivative problems? Will investors continue their retreat from U.S. fixed income mutual funds and ETFs?
"As noted in my “Issues 2013” CBB from early January: A market Bubble implies bipolar outcome possibilities. Either the entrenched Bubble bursts or it becomes an issue of “how crazy do things get?” If the U.S. stock market has evolved into the speculative Bubble of choice, there are a couple things the Fed might contemplate. First, QE may now work to spur similar late-cycle speculative excesses that are now coming home to roost throughout the fixed income universe. Second, inflating stock prices may work to pull additional liquidity away from an already liquidity-challenged bond market. It is, after all, the nature of liquidity to seek the inflating asset market."
Doug's Credit Bubble Bulletin from yesterday...always a must read for me.
Toronto Reviews Bid to Become Yuan Currency Trading Hub
Some of Canada’s largest banks, insurance companies and pension funds met with government representatives and the Bank of Canada in Toronto on June 21 to discuss establishing a yuan trading hub, according to the Toronto Financial Services Alliance, an industry group that set up the meeting.
Representatives of Chinese banks also attended the meeting, the group said, declining to name them. “There’s been expressions of interest from some companies,” said Janet Ecker, president of the finance group, who attended the meeting. “We’ve seen what’s happened in London and Singapore and Hong Kong.”
This Bloomberg story, filed from Toronto, was posted on their website early yesterday morning MDT...and it's courtesy of reader 'David in California'.
QEternity for Europe and U.K.
President Mario Draghi said the European Central Bank expects to keep interest rates low for an "extended period" as he tries to restrain market borrowing costs, in a new departure for an institution averse to setting policy in advance.
With ECB officials today leaving their main refinancing rate at 0.5 percent, Draghi fleshed out their outlook for monetary policy after investors pushed up long-term bond yields, threatening the region's economic recovery. The statement came on the same day that the Bank of England also tried to manage investor expectations in Mark Carney's first week as governor.
"The Governing Council expects the key ECB interest rates to remain at present or lower levels for an extended period of time," Draghi said at a press conference in Frankfurt. "What the Governing Council did today was to inject a downward bias in interest rates for the foreseeable future. Our exit is very distant."
This is another Bloomberg story, this one posted on their Internet site early on Thursday morning MDT...and I found it in a GATA release. It's definitely worth reading.
EU Parliament Urges Blocking US Data Access After Spy Leaks
The European Parliament called on Thursday for the scrapping of two agreements granting the United States access to European financial and travel data unless Washington reveals the extent of its electronic spying operations in Europe.
A non-binding resolution, passed by 483 votes to 98 with 65 abstentions, said the United States should come clean about its surveillance of email and communications data or risk seeing the transatlantic information-sharing deals, created in the wake of the September 11 attacks, torn up.
The parliament cannot revoke the agreements without the support of European Union governments and the bloc's executive Commission, which looks unlikely.
This is all for show...and public consumption. Absolutely nothing will change. This Reuters article, filed from Brussels on Wednesday, is courtesy of Manitoba reader Ulrike Marx.
Lawlessness Is the New Normal — Paul Craig Roberts
In various articles and in my latest book, The Failure of Laissez Faire Capitalism And Economic Dissolution Of The West, I have pointed out that the European sovereign debt crisis is being used to terminate the sovereignty of the countries that are members of the EU. There is no doubt that this is true, but the sovereignty of the EU member states is only nominal. Although the individual countries still retain some sovereignty from the EU government, they are all under Washington’s thumb, as demonstrated by the recent illegal and hostile action taken on Washington’s orders by France, Italy, Spain, Portugal, and Austria against the airliner carrying Bolivia’s President Evo Morales.
Flying back to Bolivia from Moscow, Morales’ plane was denied over flight and refueling permission by Washington’s French, Italian, Spanish, and Portuguese puppets and had to land in Austria, where the presidential plane was searched for Edward Snowden. It was a power play by Washington to kidnap Snowden from Bolivia’s presidential airliner in defiance of international law and to teach upstart reformers like Morales that independence from Washington’s orders is not permitted.
The European puppet states went along with this extraordinary breach of diplomacy and international law despite the fact that each of the countries is incensed that Washington is spying on their governments, diplomats, and citizens. Their thanks to Snowden, whose revelations made them aware that Washington was recording their every communication, was to help Washington capture Snowden.
This tells us how much morality, honor, integrity there is left in Western civilization: Zero.
This must read commentary was posted on Paul's website yesterday...and is probably one of the most important items in today's column. I thank Ulrike Marx for bringing it to my attention...and now to yours.
Argentina Applies Law That Jails Hoarders as Bread Surges
Argentina plans to apply a law that forces holders of wheat and flour suitable for bread making to sell stock on the domestic market in a bid to contain inflation.
Interior Commerce Secretary Guillermo Moreno announced the measure in the official gazette today. The 1974 law allows authorities to freeze prices and obliges companies to maintain supply. Those in breach are subject to fines and imprisonment.
“If the law on supply is applied, the one who should go to jail is Moreno himself,” former Economy Minister Martin Lousteau said in an interview with Radio Mitre today. “He’s to blame for the lack of wheat in Argentina.”
This Bloomberg article was filed from Buenos Aires...and posted on their Internet site late yesterday morning MDT. It's the second offering in today's column from reader 'David in California'.
Egypt's Cunning General: How the Military Plans to Keep Power
Adly Mansour's rise to power has been a rapid one. On Monday, the career judge was sworn in as chief justice of Egypt's Supreme Constitutional Court. ByWednesday night, President Mohammed Morsi had been deposed, the constitution suspended, and Mansour was declared the country's new interim leader, set to be sworn in on Thursday. Along with a cabinet of technocrats, he'll govern the country until new elections.
But no one knows if and when these elections might take place. And Mansour won't be Egypt's most important man, even if the justice, who served in the country's top court under deposed autocrat Hosni Mubarak, now calls himself head of state. That's because behind the scenes, the military, led by General Abdel-Fattah el-Sissi, plans to continue running the show.
Since it took power in a coup in 1952, the military has remained the most important political player in Egypt. Neither Mubarak's fall in 2011, nor the short rule by Morsi, a member of the Muslim Brotherhood, have changed this. El-Sissi demonstrated just how powerful the influence of the military's generals is on Wednesday night, when, after giving Morsi 48 hours to leave office, he summarily informed the president that he was no longer the leader of the country. No matter that Morsi was the country's first democratically elected head of state.
This story appeared on the German website spiegel.de late Thursday morning Europe time...and I thank Roy Stephens once again.
It Is Now Common Knowledge That US Drones Bomb Civilian Rescuers
Taliban commanders and security officials told Reuters that the strike mostly killed fighters for the Haqqani network.
Many were wounded in the attack, local tribesman Kaleemullah Dawar said, but rescuers delayed for fear of falling victim to a second attack, a common tactic with drone strikes. That tactic is known as the "double tap," which bombs multiple targets in relatively quick succession — meaning that the second strike often hits first responders.
The NYU/Stanford report stated: "As international law experts have noted, intentional strikes on first responders may constitute war crimes." The fact that it is now normalized as a common tactic of the U.S. drone war is stunning.
This story also from the businessinsider.com Internet site on Wednesday...and another article that I've saved for Saturday. It's a must read for all serious students of the New Great Game...and it represents Roy Stephens' final offering in today's column.
China Signals Will Cut Off Credit to Rebalance Economy
In a statement from the State Council, or cabinet, Beijing laid out broad plans to ensure banks support the kind of economic rebalancing China's new leadership wants as it looks to focus more on high-end manufacturing.
President Xi Jinping and Premier Li Keqiang have flagged for some time that the rapid growth of the past three decades needs to shift down a gear, and analysts said Friday's announcement was a signal that they intended to press on with reforms despite evidence of a sharper-than-expected slowdown.
"The guideline shows China's policymakers will focus more on economic restructuring to stabilize the economy rather than providing more liquidity to support economic growth," said Li Huiyong, an economist at Shenyin Wanguo Securities in Shanghai.
This Reuters story, filed from Beijing, was posted on their website early yesterday morning EDT...and I thank Ulrike Marx for another contribution to today's column.
Six King World News Blogs
1. Citi analyst Tom Fitzpatrick: "4 Absolutely Spectacular Gold Charts and Commentary". 2. John Williams: "We Are Beginning to Approach the End Game". 3. Dr. Benn Steil: "Gold, Financial War and the Fed's Dangerous Exit Strategy". 4. Dr. Marc Faber: "This Will End in Disaster". 5. Egon von Greyerz: "Gold and Silver Smash and Fires Burning Everywhere in the World". 6. Dr. Stephen Leeb: "Gold and a Global Financial System in Complete Turmoil".
The Smart Money Is Quietly Buying More Gold
There are also some seriously credible professionals currently buying, albeit quietly. One is Sebastian Lyon, the fund manager overseeing Personal Assets Trust, a unique, quoted £600m investment fund whose overriding aim is to preserve shareholders' capital.
The board of Personal Assets is so hell-bent on its cautious, wealth-preserving tack that it boasts about having missed stock market rallies. In its own words, it is a "tiresome holding for lovers of excitement and adventure, who will find it unbearable to see us sitting on the sidelines while the FTSE climbs tantalisingly to its peak".
Personal Assets Trust's excellent performance during the worst of the crisis was largely due to its big investment in bullion – currently more than 12pc of its portfolio. In recent months, as the price has fallen, Mr. Lyon has topped up gold holdings. That someone who follows such a cautious mandate, and has done so with such success, is today a buyer of gold is worth noting.
This commentary showed up on the telegraph.co.uk Internet site early yesterday evening BST...and it's worth skimming. I thank reader 'Roger B' for sending it our way.
Gold Jewellery Stocks Hammered in India
Gold jewellery stocks are in a free-fall in India. The curbs imposed by the Indian government and the Reserve Bank of India to curtail domestic gold consumption and imports, has led to a hammering of stock prices. Some leading jewellers shares have dived by 20% to 50% during the past fortnight.
Analysts attribute the mayhem to the fact that most gold retailers in India hold huge inventories of gold. Since the price of gold has slid in the international market, this has resulted in a huge depreciation in the value of the gold inventory held by bullion companies.
Shares of Gitanjali Gems, touted as India’s largest gold and jewellery company, have slumped more than 60% since mid-June with investors preferring to bail out even on July 4.
This interesting story, filed from Mumbai, was posted on the mineweb.comInternet site on Thursday...and my thanks go out to Ulrike Marx for passing it along.
Credit Card Transactions for Gold Purchases Curtailed in India
Buying gold in India has got a little more difficult for consumers used to using plastic money to buy large jewellery sets or heavy gold ornaments. India's apex bank has asked banks not to convert gold purchases done through credit cards into equated monthly installments.
Continuing its fight against gold consumption, the Reserve Bank of India is leaving no stone unturned to discourage gold buyers in India. The ban on conversion of gold purchases at jewellery stores into equated monthly instalments for credit card purchases has already triggered a slump in sales.
"The central bank has asked banks to stop accepting credit card purchases for gold. We only realised this when customers who fished out their credit card for high value transactions at our stores could not carry through the order. In the last 48 hours, sales have dipped over 25%," said Manmohan Gandhi, bullion retailer.
This is another story posted on the mineweb.com Internet site. This one was filed from Mumbai yesterday...and I thank Ulrike Marx for her final offering in today's column.
¤ THE WRAP
Irrespective of the sharp decline in the price of gold, physical gold—held for the long term—remains the primary hedge against the U.S. dollar debasement ahead. Yet, it has to be in place, and it has to be held through the developing crises—irrespective of short-term market volatility—in order to provide the desired asset protection. Whether gold is purchased at $250, $2,500 or $25,000 per ounce, it preserves the purchasing power of the dollars invested. Someone looking to take profits at $100,000 an ounce is missing what has happened. Those “profits” are just the preserved purchasing power of the invested dollars. - John Williams...shadowstats.com...3
Protests Sweep Bulgaria As Government Collapses Amid Chaos
The Bulgarian government was officially dissolved on Wednesday with the resignation of Prime Minister Boiko Borisov as thousands took to the street to protest against high electricity bills and declining living standards. The country, which joined the EU in 2001, remains the poorest member of the union after a long and troubled transition to capitalism.
The first casualty of the on-going crisis became Bulgarian finance minister Simeon Djankov — a well-respected former World Bank official who undertook painful economic reforms and austerity measures. Djankov stepped down on Tuesday in the middle of escalating protests in the capital of Sofia where people with signs that read "Mafia" and "Bring Down the Monopolies" were rallying against lack of transparency and monopolistic practices in the energy sector.
As the nationwide protest steadily turned against "Everything and Everyone," violent clashes with the police errupted leaving at least 25 injured in Sofia which increased the pressure on Borisov's leadership three months before the official end of his term.
Borisov, known for his hard-line can-do style, has successfully carried out ambitious infrastructure projects and EU programs. However, rising unemployment and soaring living costs have put millions of Bulgarians on the brink of poverty in a country where the average monthly salary continues to be less than 400 euros a month.
In a surprise move on Wednesday Prime Minister Borisov officially announced his resignation, saying, "I am unable to witness the blood on the streets. The people put us in power and today we give it back to them." His centrist GERB party will not participate in the formation of a new government which leaves many open questions about the political stability of the country.
Bulgarian President Rosen Plevneliev addressed the nation and announced his efforts to put together an interim government until the elections can be held this spring.
Despite the cabinet resignation the violent clashes in Sofia have intensified late on Wednesday as protesters demand the exit of the entire political establishment.
A 36-year-old man set himself on fire in the city of Varna where protests are demanding Mayor Kiril Yordanov's resignation. Yordanov is currently serving his fourth consecutive term and has held the post since 1999.
Lack of fresh ideas and alternatives have paralyzed the aging and complacent political class of Bulgaria. More than three million Bulgarians, which accounts for close to 40% of the total population, have left the country since the fall of communism in search of better education and job opportunities.
Those who have remained in the country have steadily seen their post-communism dreams disappear in corruption, political scandals and rising unemployment among young people.
Similar protests have been sparked in Slovenia where the government is struggling to remain in power. One protester, Miha Borovovec, said, "This government is totalitarian, it is corrupt, it is taking our country down. That’s why I am here; this authority will destroy our country."
Yet, the current protests might actually provide hope for Bulgaria's future, as many young Bulgarians expect better from their government and have shown that they intend to do something about it. The dissolution of the new government could prove a crucial starting point of the next chapter in the country's history.
Dave Kranzler of the GoldenTruth gives his expert opinion on the farcical numbers:
(Dave from Denver/the GoldenTruth)
(Dave from Denver/the GoldenTruth)
FRIDAY, JULY 5, 2013
The Government's Numbers Are A Complete Farce - Part Time Jobs +322k, Full-time down 240k
[Please note: the S&P 500 futures have plunged 26 pts from their intra-day high, the Dow briefly went red after opening up over 100 points. This fact confirms my analysis below]
In fact, our entire system is a joke. I see where it's being reported that the "inquiry" into Steven Cohen's insider trading will take years. That tells me everything I need to know: the rogue billionaire hedge fund trader has all the right people in all the right places paid off handsomely.
As for today's employment report, to say I'm nearly speechless over how just absurd it is would be nothing more than social correctness. I hope everyone takes note that 322k of the supposed jobs created were part-time - full-time jobs declined by 240k. I'm not going to take the time to dissect the entire report - you can go to Zerohedge.com for that. It's really a waste of time to try and analyze fraud. But here's my thoughts:
Today's jobs report featured 322k increase in part-time jobs. That would be in the services industry. The same services segment of the economy for which the Institute of Supply Management announced on Wednesday that its employment index plunged to its 2009 level: LINK
Who's right? The Govt bean counters or the businesses who do the actual hiring? I'll let you decide.
Please note that new orders per the ISM report plunged to 2008 levels.
Also please note that while the Govt released a number than enables the momentum traders to juice the SPX and hit the metals today, the Govt also made sure that the unemployment rate stayed comfortably above the 7% level and it was actually a bit higher than expected. The 7% level being the number everyone on CNBC is watching to decide if the Fed will really "taper."
Also note that overnight last night that India and Viet Nam were aggressively buying despite Govt attempts in both countries to curb gold buying.
Let the boys have their fun today with the low volume in all the markets and not many players around, now that the rest of the world has left for the weekend except our British lapdogs. And in a couple hours the Brits will go to their kennels for the weekend.
Next week and over the rest of the summer, it's going to become harder for the Government to lie about what's really going on the economy as the evidences of the truth will become more apparent to everyone.
A great article from Dr Paul Craig Roberts:
(courtesy Dr Roberts)
Has Washington’s Arrogance Undone Its Empire? — Paul Craig Roberts
Has Washington’s Arrogance Undone Its Empire?
Paul Craig Roberts
No one likes a bully, and Washington’s NATO puppets have been bullied for six decades. British prime ministers, German chancellors, and French presidents have to salute and say “yes sir.”
They all hate it, but they love Washington’s money; so they prostitute themselves and their countries for Washington’s money. Even a person of Winston Churchill’s stature had to suck up to Washington in order to get his bills and his country’s bills paid.
But what the bought European leaders are finding is that Washington doesn’t pay enough for the prostitution required. One year out of office Tony Blair was worth $35 million dollars. But that’s not enough to get Blair on the waiting list for $50 million 200 foot yachts, to have a chalet in Gstaad, $50 million penthouses in Paris and New York, and a private plane to fly between them, or to wear a $736,000 Franck Muller watch on his wrist, sign his name with a $700,000 Mont Blanc jewel-encrusted pen, and drink $10,000 “martinis on a rock” (gin or vodka poured over a diamond) at New York’s Algonquin Hotel.
In a world in which every member of the Forbes Four Hundred is a billionaire plus or multi-billionaire, $35,000,000 just doesn’t cut it. In 2006 the manager of one hedge fund was paid $1,700,000,000 for one year’s thieving. Another 25 were paid $575,000,000 for their skills in front-running trades. $35 million is probably the annual budget for their household servants.
The British seem content in their role as Washington’s favorite lackey, but France and Germany have not enjoyed that role. France’s last real leader, General de Gaulle, would have nothing to do with it and refused to join NATO. Germany, dismembered with East Germany occupied by the Soviets, had no choice. Germans’ gratitude to President Reagan for their unification resulted in re-unified Germany falling under Washington’s hegemony.
However, if news reports from Berlin are true, Germany has had enough. The catalyst was Edward Snowden’s revelations that Washington spies on everyone including its allies, both Germany and the EU in particular. Moreover, Washington uses Britain as the Trojan Horse within the EU as a backup spy in case NSA misses something.
According to news reports, the German, French, and EU governments are upset to find out that their extreme subservience to Washington has not protected them and their citizens from being spied upon. Here they are, fighting Washington’s wars in far distant Afghanistan, the fate of which is completely unrelated to their own, and what does Washington do but embarrass them by spying on the personal lives of their citizens.
Who does the Merkel government represent, Germans are asking, Germans or the NSA? Why does the Merkel government kowtow to Washington? The next question will be: “what does Washington’s spies have on Merkel?”
With the German government put on the spot by Washington’s betrayal, news headlines are: “Germany Ready to Charge UK and US Intelligence Over Bugging Operations.”
Little wonder Washington and its media whores hate Edward Snowden. “A spokesman for the [German] Federal Prosecutor said the office was preparing to bring charges against” the UK and US intelligence services. In light of the Snowden affair, it will be wonderful if Germany issues arrest warrants and Washington and London refuse to extradite its NSA and UK spy operatives who have violated every law and every trust.
The German Justice Minister, Sabine Leutheusser-Schnarrenburger, demanded an “immediate explanation” why Washington was applying to Germany policies “reminiscent of the actions against enemies during the Cold War.”
The president of France has said that France will not again cooperate with Washington on any issue until France receives “full assurances” that Washington will cease spying on France.
The president of the European Parliament, Martin Schulz, and the EU Commissioner for Justice, Viviane Reding, demand Washington’s answer to Snowden’s revelations that Washington has betrayed its own allies.
The question that must be asked is: do any of these protests from politicians who are
almost certain to be on Washington’s payroll mean anything, or are they just make-believe protests to quiet the domestic European populations who have been betrayed by their elected leaders? Why would the French president and the German justice minister think any reassurance from Washington meant anything? When in human memory has Washington told the truth about anything? When has Washington’s reassurance meant anything?
The Tonkin Gulf? Iraqi weapons of mass destruction? Iranian nukes? Assad’s sarin gas attack? FBI orchestrated “terror attacks”? It is a proven fact that the US government lies every time it opens its mouth. Compared to Washington, Stalin, Hitler, Tojo, Mao, Castro, Chavez, and Pol Pot were truthful.
Washington’s reply to Europe’s demands for explanation is: “We will discuss these issues bilaterally with EU member states,” but “we are not going to comment publicly on specific alleged intelligence activities.”
You know what that means. Bilateral means that Washington is going to talk with each EU country separately, using the information NSA has obtained to blackmail each complainant into silence. Whereas the EU together could stand up to Washington, separately the countries can be browbeat and offered more money or threats that illicit love affairs will be revealed to shut them up. Washington is betting on its power to intimidate individual countries with the threat of isolation and being cut off from money. If the EU countries agree to the secret bilateral explanations from Washington, the affair will end and the spying on Europe will continue while Washington and the EU politicians deny that the spying continues.
By now the entire world must know that Washington is not merely lawless, but also totally out of control, reveling in arrogance and hubris, driven by desires for hegemony over the entire world. Washington is so paranoid and distrustful that it doesn’t even trust its own citizens or the European puppet governments that it has bought and paid for.
Washington is the only government that has ever used nuclear weapons, and Washington used them against a defeated government that was trying to surrender. Today the craziness in Washington is much worse. Decision-making councils are full of crazed neoconservative war-mongers, such as National Security Advisor Susan Rice, a threat to humanity. Washington think tanks and media are over-represented by neoconservatives such as William Kristol who wants to know “what good are nuclear weapons if you can’t use them?”
The sleazy European politicians and media who took Washington’s money provided for their own economic security, but they betrayed the security of the entire world. By enabling Washington’s hegemony, they unleashed Washington’s arrogance. This arrogance now threatens not merely the independence of every country but life on earth.
Instead of meeting unilaterally alone with Washington, the European countries should
stand together. After all, supposedly there is an EU. If there is an EU, Washington should meet with the EU, not with its constituent parts individually, no one of which can stand up to Washington’s intimidation and bribes.
If thermo-nuclear war is to be avoided and life is to continue on earth, Europe must disband NATO. The North Atlantic Treaty Organization was formed in the aftermath of World War II. Its purpose was to prevent the powerful Red Army, which defeated Nazi Germany, from overrunning all of Western Europe.
The Soviet Union collapsed in 1991, 22 years ago. Yet, NATO still exists. Moreover, against President Reagan’s intentions, NATO has grown. NATO now includes former constituent parts of the Soviet Empire, such as Eastern Europe, and former constituent parts of the Soviet Union itself, such as Georgia, the government of which is bought and paid for by Washington. The NGOs that Washington funds might even deliver Ukraine into Washington’s fold.
Egged on by Washington, Georgia initiated a war with present day Russia, which superior Russian forces quickly ended. In the opinion of many, the Russian government showed far too much tolerance for its defeated enemy, which is being rearmed by Washington and encouraged into new military adventures. Washington is working to make Georgia, located in Asia between the Black and Caspian seas, a member of the North Atlantic Treaty Organization. NATO membership would make Georgia a treaty protectorate of Washington and its NATO puppets. Washington thinks that this elevation of Georgia would result in Russia acquiescing to Georgian aggression in order to avoid war with the US and NATO.
China, also, has been amazingly abused by Washington, and instead of replying in kind, has taken it in stride. This magnanimity on the part of the Chinese has been misinterpreted by Washington as fear. The fear that Washington imagines is causing China to quake in its boots has encouraged Washington to surround China with new naval, air, and troop bases. The fact that however numerous are Washington’s bases in the Pacific and South China Sea, Washington itself is an ICBM away has not registered on the ignorant scum that rules Amerika. Overwhelmed by its hubris, Washington threatens all life on earth.
And Ed Steer's Report ......
http://www.caseyresearch.com/gsd/edition/ted-butler-the-new-law-of-supply-and-demand
¤ YESTERDAY IN GOLD & SILVER
With the U.S. closed on their Thursday, the gold price didn't do much. All that changed shortly after trading began in the Far East on their Friday morning...and by the 10:30 a.m. BST morning gold fix in London, the gold price was down twenty bucks from Tuesday's 5:15 p.m. EDT electronic close. From that low, gold rallied a bit until 8:30 a.m. in New York.
Then the jobs report came out...and someone hit the buy the dollar/sell gold button. The U.S. bond market got crushed as well.
The low tick of the day [$1,207.50 spot] came at the London p.m. gold fix at 3:00 p.m. BST...10:00 a.m. in New York.
The gold price recovered a bit from there, but then traded sideways from the London close until around 3:30 p.m. EDT. From there it rallied a few dollars into the close.
Gold finished the day on Friday at $1,223.80 spot...down $28.70 from Tuesday's close in New York. Net volume was a hair under 200,000 contracts...and that figure includes Thursday's volume as well.
It was pretty much the same chart pattern in silver, although it got hit much harder than gold did. But as you know by now, dear reader, this is JPMorgan's problem child...and they're obviously still chipping away at what's left of their grotesque short position in this metal.
The only difference between gold and silver's price pattern was the low tick in silver [$18.63 spot] came about 10:45 a.m. EDT...fifteen minutes before the London close...and not at the p.m. gold fix.
Silver finished the Friday session at $18.90 spot...down 82 cents from Tuesday. Silver's gross volumeon Thursday and Friday totaled 59,500 contracts.
The platinum and palladium charts look somewhat similar, although palladium's recovery was the most impressive of all four precious metals. Here are the charts...
Over the two days, gold closed down 2.29%...silver got clubbed for 4.16%...platinum closed lower by 1.42%...and palladium was down only 0.29%.
The dollar index closed on Tuesday at 83.24...and closed yesterday at 84.44...up 120 basis points, the gains just about evenly split between Thursday and Friday. With New York closed on Thursday, there was very little reaction by the precious metals to the 60 basis point rise in the index on that day. That situation was rectified yesterday.
Because of the holiday-shortened week, the CME's Daily Delivery Report wasn't much to see yesterday, as zero gold and 17 silver contracts were posted for delivery on Tuesday within the Comex-approved depositories. The link to yesterday's Issuers and Stoppers Report is here.
Like it has been all week...GLD went in one direction...and SLV went in the other on Friday. InGLD, an authorized participant withdrew 86,967 troy ounces...but in SLV an authorized participant[s] deposited a very chunky 2,894,736 troy ounces. During the first week of July just past, there have been withdrawals form GLD totaling 241,584 troy ounces. But in SLV for the week that was...4,680,551 troy ounces of silver have been deposited. If you're looking for a reason for this dichotomy...I don't have any answers for you.
Over at Switzerland's Zürcher Kantonalbank, they reported big sell offs in both their gold and silver ETFs for the week ending June 28th. In their gold ETF, it was 382,233 troy ounces...and in their silver ETF it was a very large 2,104,775 troy ounces. These are the biggest one-week sell offs in these two funds that I can remember...and one has to wonder who the new owners of all this metal are. I would guess that it's a bullion bank of some sort.
There was no sales report from the U.S. Mint again yesterday.
Over at the Comex-approved depositories on Wednesday, they didn't report receiving anysilver, but they did ship 560,847 troy ounces out the door. The link to that action is here.
In gold, these same depositories reported receiving 36,121 troy ounces...but they shipped out a chunky 152,057 troy ounces. The link to that activity is here.
As I've mentioned in every column this week...because of the U.S. holiday on Thursday, the COT Report and the Bank Participation Report won't be out until Monday...and I'll report on both in my Tuesday column.
I have two days' worth of stories...and despite taking an axe to the list, there are still a lot left, so the final edit is yours.
* * *
non redundant news and views.......
Doug Noland: Mispricing Risk
Bonds taken out to the woodshed, again.
U.S. bonds were crushed Friday on the back of stronger-than-expected payroll data. Long-bond yields jumped 21 bps to an almost 23-month high 3.71%. Ten-year yields rose 24 bps to 2.74% - the highest yields since August 5, 2011. Benchmark MBS yields surged 30 bps during the session to a 23-month high 3.69%. The spread between 10-year Treasury yields and benchmark MBS widened six on Friday to a one-year high 95 bps. Notably, MBS yields were up 75 bps in 14 sessions and 140 bps since May 1st.
"With unprecedented outflows from the bond complex coupled with notable global central bank selling, the Bubble in U.S. fixed income would appear in serious jeopardy. And while analysts and money managers will continue talk of a “fair value” range for Treasury securities, for the time being flow of funds analysis trumps valuation. Will foreign central banks continue reducing their enormous holdings of U.S. Treasury and Agency securities? How much leverage has accumulated throughout U.S. fixed income – especially in corporates, MBS and municipal debt? How long until some hedge funds are in trouble? Redemptions coming? Derivative problems? Will investors continue their retreat from U.S. fixed income mutual funds and ETFs?
"As noted in my “Issues 2013” CBB from early January: A market Bubble implies bipolar outcome possibilities. Either the entrenched Bubble bursts or it becomes an issue of “how crazy do things get?” If the U.S. stock market has evolved into the speculative Bubble of choice, there are a couple things the Fed might contemplate. First, QE may now work to spur similar late-cycle speculative excesses that are now coming home to roost throughout the fixed income universe. Second, inflating stock prices may work to pull additional liquidity away from an already liquidity-challenged bond market. It is, after all, the nature of liquidity to seek the inflating asset market."
Doug's Credit Bubble Bulletin from yesterday...always a must read for me.
Toronto Reviews Bid to Become Yuan Currency Trading Hub
Some of Canada’s largest banks, insurance companies and pension funds met with government representatives and the Bank of Canada in Toronto on June 21 to discuss establishing a yuan trading hub, according to the Toronto Financial Services Alliance, an industry group that set up the meeting.
Representatives of Chinese banks also attended the meeting, the group said, declining to name them. “There’s been expressions of interest from some companies,” said Janet Ecker, president of the finance group, who attended the meeting. “We’ve seen what’s happened in London and Singapore and Hong Kong.”
This Bloomberg story, filed from Toronto, was posted on their website early yesterday morning MDT...and it's courtesy of reader 'David in California'.
QEternity for Europe and U.K.
President Mario Draghi said the European Central Bank expects to keep interest rates low for an "extended period" as he tries to restrain market borrowing costs, in a new departure for an institution averse to setting policy in advance.
With ECB officials today leaving their main refinancing rate at 0.5 percent, Draghi fleshed out their outlook for monetary policy after investors pushed up long-term bond yields, threatening the region's economic recovery. The statement came on the same day that the Bank of England also tried to manage investor expectations in Mark Carney's first week as governor.
"The Governing Council expects the key ECB interest rates to remain at present or lower levels for an extended period of time," Draghi said at a press conference in Frankfurt. "What the Governing Council did today was to inject a downward bias in interest rates for the foreseeable future. Our exit is very distant."
This is another Bloomberg story, this one posted on their Internet site early on Thursday morning MDT...and I found it in a GATA release. It's definitely worth reading.
EU Parliament Urges Blocking US Data Access After Spy Leaks
The European Parliament called on Thursday for the scrapping of two agreements granting the United States access to European financial and travel data unless Washington reveals the extent of its electronic spying operations in Europe.
A non-binding resolution, passed by 483 votes to 98 with 65 abstentions, said the United States should come clean about its surveillance of email and communications data or risk seeing the transatlantic information-sharing deals, created in the wake of the September 11 attacks, torn up.
The parliament cannot revoke the agreements without the support of European Union governments and the bloc's executive Commission, which looks unlikely.
This is all for show...and public consumption. Absolutely nothing will change. This Reuters article, filed from Brussels on Wednesday, is courtesy of Manitoba reader Ulrike Marx.
Lawlessness Is the New Normal — Paul Craig Roberts
In various articles and in my latest book, The Failure of Laissez Faire Capitalism And Economic Dissolution Of The West, I have pointed out that the European sovereign debt crisis is being used to terminate the sovereignty of the countries that are members of the EU. There is no doubt that this is true, but the sovereignty of the EU member states is only nominal. Although the individual countries still retain some sovereignty from the EU government, they are all under Washington’s thumb, as demonstrated by the recent illegal and hostile action taken on Washington’s orders by France, Italy, Spain, Portugal, and Austria against the airliner carrying Bolivia’s President Evo Morales.
Flying back to Bolivia from Moscow, Morales’ plane was denied over flight and refueling permission by Washington’s French, Italian, Spanish, and Portuguese puppets and had to land in Austria, where the presidential plane was searched for Edward Snowden. It was a power play by Washington to kidnap Snowden from Bolivia’s presidential airliner in defiance of international law and to teach upstart reformers like Morales that independence from Washington’s orders is not permitted.
The European puppet states went along with this extraordinary breach of diplomacy and international law despite the fact that each of the countries is incensed that Washington is spying on their governments, diplomats, and citizens. Their thanks to Snowden, whose revelations made them aware that Washington was recording their every communication, was to help Washington capture Snowden.
This tells us how much morality, honor, integrity there is left in Western civilization: Zero.
This must read commentary was posted on Paul's website yesterday...and is probably one of the most important items in today's column. I thank Ulrike Marx for bringing it to my attention...and now to yours.
Argentina Applies Law That Jails Hoarders as Bread Surges
Argentina plans to apply a law that forces holders of wheat and flour suitable for bread making to sell stock on the domestic market in a bid to contain inflation.
Interior Commerce Secretary Guillermo Moreno announced the measure in the official gazette today. The 1974 law allows authorities to freeze prices and obliges companies to maintain supply. Those in breach are subject to fines and imprisonment.
“If the law on supply is applied, the one who should go to jail is Moreno himself,” former Economy Minister Martin Lousteau said in an interview with Radio Mitre today. “He’s to blame for the lack of wheat in Argentina.”
This Bloomberg article was filed from Buenos Aires...and posted on their Internet site late yesterday morning MDT. It's the second offering in today's column from reader 'David in California'.
Egypt's Cunning General: How the Military Plans to Keep Power
Adly Mansour's rise to power has been a rapid one. On Monday, the career judge was sworn in as chief justice of Egypt's Supreme Constitutional Court. ByWednesday night, President Mohammed Morsi had been deposed, the constitution suspended, and Mansour was declared the country's new interim leader, set to be sworn in on Thursday. Along with a cabinet of technocrats, he'll govern the country until new elections.
But no one knows if and when these elections might take place. And Mansour won't be Egypt's most important man, even if the justice, who served in the country's top court under deposed autocrat Hosni Mubarak, now calls himself head of state. That's because behind the scenes, the military, led by General Abdel-Fattah el-Sissi, plans to continue running the show.
Since it took power in a coup in 1952, the military has remained the most important political player in Egypt. Neither Mubarak's fall in 2011, nor the short rule by Morsi, a member of the Muslim Brotherhood, have changed this. El-Sissi demonstrated just how powerful the influence of the military's generals is on Wednesday night, when, after giving Morsi 48 hours to leave office, he summarily informed the president that he was no longer the leader of the country. No matter that Morsi was the country's first democratically elected head of state.
This story appeared on the German website spiegel.de late Thursday morning Europe time...and I thank Roy Stephens once again.
It Is Now Common Knowledge That US Drones Bomb Civilian Rescuers
Taliban commanders and security officials told Reuters that the strike mostly killed fighters for the Haqqani network.
Many were wounded in the attack, local tribesman Kaleemullah Dawar said, but rescuers delayed for fear of falling victim to a second attack, a common tactic with drone strikes. That tactic is known as the "double tap," which bombs multiple targets in relatively quick succession — meaning that the second strike often hits first responders.
The NYU/Stanford report stated: "As international law experts have noted, intentional strikes on first responders may constitute war crimes." The fact that it is now normalized as a common tactic of the U.S. drone war is stunning.
This story also from the businessinsider.com Internet site on Wednesday...and another article that I've saved for Saturday. It's a must read for all serious students of the New Great Game...and it represents Roy Stephens' final offering in today's column.
China Signals Will Cut Off Credit to Rebalance Economy
In a statement from the State Council, or cabinet, Beijing laid out broad plans to ensure banks support the kind of economic rebalancing China's new leadership wants as it looks to focus more on high-end manufacturing.
President Xi Jinping and Premier Li Keqiang have flagged for some time that the rapid growth of the past three decades needs to shift down a gear, and analysts said Friday's announcement was a signal that they intended to press on with reforms despite evidence of a sharper-than-expected slowdown.
"The guideline shows China's policymakers will focus more on economic restructuring to stabilize the economy rather than providing more liquidity to support economic growth," said Li Huiyong, an economist at Shenyin Wanguo Securities in Shanghai.
This Reuters story, filed from Beijing, was posted on their website early yesterday morning EDT...and I thank Ulrike Marx for another contribution to today's column.
Six King World News Blogs
1. Citi analyst Tom Fitzpatrick: "4 Absolutely Spectacular Gold Charts and Commentary". 2. John Williams: "We Are Beginning to Approach the End Game". 3. Dr. Benn Steil: "Gold, Financial War and the Fed's Dangerous Exit Strategy". 4. Dr. Marc Faber: "This Will End in Disaster". 5. Egon von Greyerz: "Gold and Silver Smash and Fires Burning Everywhere in the World". 6. Dr. Stephen Leeb: "Gold and a Global Financial System in Complete Turmoil".
The Smart Money Is Quietly Buying More Gold
There are also some seriously credible professionals currently buying, albeit quietly. One is Sebastian Lyon, the fund manager overseeing Personal Assets Trust, a unique, quoted £600m investment fund whose overriding aim is to preserve shareholders' capital.
The board of Personal Assets is so hell-bent on its cautious, wealth-preserving tack that it boasts about having missed stock market rallies. In its own words, it is a "tiresome holding for lovers of excitement and adventure, who will find it unbearable to see us sitting on the sidelines while the FTSE climbs tantalisingly to its peak".
Personal Assets Trust's excellent performance during the worst of the crisis was largely due to its big investment in bullion – currently more than 12pc of its portfolio. In recent months, as the price has fallen, Mr. Lyon has topped up gold holdings. That someone who follows such a cautious mandate, and has done so with such success, is today a buyer of gold is worth noting.
This commentary showed up on the telegraph.co.uk Internet site early yesterday evening BST...and it's worth skimming. I thank reader 'Roger B' for sending it our way.
Gold Jewellery Stocks Hammered in India
Gold jewellery stocks are in a free-fall in India. The curbs imposed by the Indian government and the Reserve Bank of India to curtail domestic gold consumption and imports, has led to a hammering of stock prices. Some leading jewellers shares have dived by 20% to 50% during the past fortnight.
Analysts attribute the mayhem to the fact that most gold retailers in India hold huge inventories of gold. Since the price of gold has slid in the international market, this has resulted in a huge depreciation in the value of the gold inventory held by bullion companies.
Shares of Gitanjali Gems, touted as India’s largest gold and jewellery company, have slumped more than 60% since mid-June with investors preferring to bail out even on July 4.
This interesting story, filed from Mumbai, was posted on the mineweb.comInternet site on Thursday...and my thanks go out to Ulrike Marx for passing it along.
Credit Card Transactions for Gold Purchases Curtailed in India
Buying gold in India has got a little more difficult for consumers used to using plastic money to buy large jewellery sets or heavy gold ornaments. India's apex bank has asked banks not to convert gold purchases done through credit cards into equated monthly installments.
Continuing its fight against gold consumption, the Reserve Bank of India is leaving no stone unturned to discourage gold buyers in India. The ban on conversion of gold purchases at jewellery stores into equated monthly instalments for credit card purchases has already triggered a slump in sales.
"The central bank has asked banks to stop accepting credit card purchases for gold. We only realised this when customers who fished out their credit card for high value transactions at our stores could not carry through the order. In the last 48 hours, sales have dipped over 25%," said Manmohan Gandhi, bullion retailer.
This is another story posted on the mineweb.com Internet site. This one was filed from Mumbai yesterday...and I thank Ulrike Marx for her final offering in today's column.
¤ THE WRAP
Irrespective of the sharp decline in the price of gold, physical gold—held for the long term—remains the primary hedge against the U.S. dollar debasement ahead. Yet, it has to be in place, and it has to be held through the developing crises—irrespective of short-term market volatility—in order to provide the desired asset protection. Whether gold is purchased at $250, $2,500 or $25,000 per ounce, it preserves the purchasing power of the dollars invested. Someone looking to take profits at $100,000 an ounce is missing what has happened. Those “profits” are just the preserved purchasing power of the invested dollars. - John Williams...shadowstats.com...3
[Please note: the S&P 500 futures have plunged 26 pts from their intra-day high, the Dow briefly went red after opening up over 100 points. This fact confirms my analysis below]
In fact, our entire system is a joke. I see where it's being reported that the "inquiry" into Steven Cohen's insider trading will take years. That tells me everything I need to know: the rogue billionaire hedge fund trader has all the right people in all the right places paid off handsomely.
As for today's employment report, to say I'm nearly speechless over how just absurd it is would be nothing more than social correctness. I hope everyone takes note that 322k of the supposed jobs created were part-time - full-time jobs declined by 240k. I'm not going to take the time to dissect the entire report - you can go to Zerohedge.com for that. It's really a waste of time to try and analyze fraud. But here's my thoughts:
Today's jobs report featured 322k increase in part-time jobs. That would be in the services industry. The same services segment of the economy for which the Institute of Supply Management announced on Wednesday that its employment index plunged to its 2009 level: LINK
Who's right? The Govt bean counters or the businesses who do the actual hiring? I'll let you decide.
Please note that new orders per the ISM report plunged to 2008 levels.
Also please note that while the Govt released a number than enables the momentum traders to juice the SPX and hit the metals today, the Govt also made sure that the unemployment rate stayed comfortably above the 7% level and it was actually a bit higher than expected. The 7% level being the number everyone on CNBC is watching to decide if the Fed will really "taper."
Also note that overnight last night that India and Viet Nam were aggressively buying despite Govt attempts in both countries to curb gold buying.
Let the boys have their fun today with the low volume in all the markets and not many players around, now that the rest of the world has left for the weekend except our British lapdogs. And in a couple hours the Brits will go to their kennels for the weekend.
Next week and over the rest of the summer, it's going to become harder for the Government to lie about what's really going on the economy as the evidences of the truth will become more apparent to everyone.
A great article from Dr Paul Craig Roberts:
(courtesy Dr Roberts)
(courtesy Dr Roberts)
Has Washington’s Arrogance Undone Its Empire? — Paul Craig Roberts
Has Washington’s Arrogance Undone Its Empire?
Paul Craig Roberts
No one likes a bully, and Washington’s NATO puppets have been bullied for six decades. British prime ministers, German chancellors, and French presidents have to salute and say “yes sir.”
They all hate it, but they love Washington’s money; so they prostitute themselves and their countries for Washington’s money. Even a person of Winston Churchill’s stature had to suck up to Washington in order to get his bills and his country’s bills paid.
But what the bought European leaders are finding is that Washington doesn’t pay enough for the prostitution required. One year out of office Tony Blair was worth $35 million dollars. But that’s not enough to get Blair on the waiting list for $50 million 200 foot yachts, to have a chalet in Gstaad, $50 million penthouses in Paris and New York, and a private plane to fly between them, or to wear a $736,000 Franck Muller watch on his wrist, sign his name with a $700,000 Mont Blanc jewel-encrusted pen, and drink $10,000 “martinis on a rock” (gin or vodka poured over a diamond) at New York’s Algonquin Hotel.
In a world in which every member of the Forbes Four Hundred is a billionaire plus or multi-billionaire, $35,000,000 just doesn’t cut it. In 2006 the manager of one hedge fund was paid $1,700,000,000 for one year’s thieving. Another 25 were paid $575,000,000 for their skills in front-running trades. $35 million is probably the annual budget for their household servants.
The British seem content in their role as Washington’s favorite lackey, but France and Germany have not enjoyed that role. France’s last real leader, General de Gaulle, would have nothing to do with it and refused to join NATO. Germany, dismembered with East Germany occupied by the Soviets, had no choice. Germans’ gratitude to President Reagan for their unification resulted in re-unified Germany falling under Washington’s hegemony.
However, if news reports from Berlin are true, Germany has had enough. The catalyst was Edward Snowden’s revelations that Washington spies on everyone including its allies, both Germany and the EU in particular. Moreover, Washington uses Britain as the Trojan Horse within the EU as a backup spy in case NSA misses something.
According to news reports, the German, French, and EU governments are upset to find out that their extreme subservience to Washington has not protected them and their citizens from being spied upon. Here they are, fighting Washington’s wars in far distant Afghanistan, the fate of which is completely unrelated to their own, and what does Washington do but embarrass them by spying on the personal lives of their citizens.
Who does the Merkel government represent, Germans are asking, Germans or the NSA? Why does the Merkel government kowtow to Washington? The next question will be: “what does Washington’s spies have on Merkel?”
With the German government put on the spot by Washington’s betrayal, news headlines are: “Germany Ready to Charge UK and US Intelligence Over Bugging Operations.”
Little wonder Washington and its media whores hate Edward Snowden. “A spokesman for the [German] Federal Prosecutor said the office was preparing to bring charges against” the UK and US intelligence services. In light of the Snowden affair, it will be wonderful if Germany issues arrest warrants and Washington and London refuse to extradite its NSA and UK spy operatives who have violated every law and every trust.
The German Justice Minister, Sabine Leutheusser-Schnarrenburger, demanded an “immediate explanation” why Washington was applying to Germany policies “reminiscent of the actions against enemies during the Cold War.”
The president of France has said that France will not again cooperate with Washington on any issue until France receives “full assurances” that Washington will cease spying on France.
The president of the European Parliament, Martin Schulz, and the EU Commissioner for Justice, Viviane Reding, demand Washington’s answer to Snowden’s revelations that Washington has betrayed its own allies.
The question that must be asked is: do any of these protests from politicians who are
almost certain to be on Washington’s payroll mean anything, or are they just make-believe protests to quiet the domestic European populations who have been betrayed by their elected leaders? Why would the French president and the German justice minister think any reassurance from Washington meant anything? When in human memory has Washington told the truth about anything? When has Washington’s reassurance meant anything?
The Tonkin Gulf? Iraqi weapons of mass destruction? Iranian nukes? Assad’s sarin gas attack? FBI orchestrated “terror attacks”? It is a proven fact that the US government lies every time it opens its mouth. Compared to Washington, Stalin, Hitler, Tojo, Mao, Castro, Chavez, and Pol Pot were truthful.
Washington’s reply to Europe’s demands for explanation is: “We will discuss these issues bilaterally with EU member states,” but “we are not going to comment publicly on specific alleged intelligence activities.”
You know what that means. Bilateral means that Washington is going to talk with each EU country separately, using the information NSA has obtained to blackmail each complainant into silence. Whereas the EU together could stand up to Washington, separately the countries can be browbeat and offered more money or threats that illicit love affairs will be revealed to shut them up. Washington is betting on its power to intimidate individual countries with the threat of isolation and being cut off from money. If the EU countries agree to the secret bilateral explanations from Washington, the affair will end and the spying on Europe will continue while Washington and the EU politicians deny that the spying continues.
By now the entire world must know that Washington is not merely lawless, but also totally out of control, reveling in arrogance and hubris, driven by desires for hegemony over the entire world. Washington is so paranoid and distrustful that it doesn’t even trust its own citizens or the European puppet governments that it has bought and paid for.
Washington is the only government that has ever used nuclear weapons, and Washington used them against a defeated government that was trying to surrender. Today the craziness in Washington is much worse. Decision-making councils are full of crazed neoconservative war-mongers, such as National Security Advisor Susan Rice, a threat to humanity. Washington think tanks and media are over-represented by neoconservatives such as William Kristol who wants to know “what good are nuclear weapons if you can’t use them?”
The sleazy European politicians and media who took Washington’s money provided for their own economic security, but they betrayed the security of the entire world. By enabling Washington’s hegemony, they unleashed Washington’s arrogance. This arrogance now threatens not merely the independence of every country but life on earth.
Instead of meeting unilaterally alone with Washington, the European countries should
stand together. After all, supposedly there is an EU. If there is an EU, Washington should meet with the EU, not with its constituent parts individually, no one of which can stand up to Washington’s intimidation and bribes.
If thermo-nuclear war is to be avoided and life is to continue on earth, Europe must disband NATO. The North Atlantic Treaty Organization was formed in the aftermath of World War II. Its purpose was to prevent the powerful Red Army, which defeated Nazi Germany, from overrunning all of Western Europe.
The Soviet Union collapsed in 1991, 22 years ago. Yet, NATO still exists. Moreover, against President Reagan’s intentions, NATO has grown. NATO now includes former constituent parts of the Soviet Empire, such as Eastern Europe, and former constituent parts of the Soviet Union itself, such as Georgia, the government of which is bought and paid for by Washington. The NGOs that Washington funds might even deliver Ukraine into Washington’s fold.
Egged on by Washington, Georgia initiated a war with present day Russia, which superior Russian forces quickly ended. In the opinion of many, the Russian government showed far too much tolerance for its defeated enemy, which is being rearmed by Washington and encouraged into new military adventures. Washington is working to make Georgia, located in Asia between the Black and Caspian seas, a member of the North Atlantic Treaty Organization. NATO membership would make Georgia a treaty protectorate of Washington and its NATO puppets. Washington thinks that this elevation of Georgia would result in Russia acquiescing to Georgian aggression in order to avoid war with the US and NATO.
China, also, has been amazingly abused by Washington, and instead of replying in kind, has taken it in stride. This magnanimity on the part of the Chinese has been misinterpreted by Washington as fear. The fear that Washington imagines is causing China to quake in its boots has encouraged Washington to surround China with new naval, air, and troop bases. The fact that however numerous are Washington’s bases in the Pacific and South China Sea, Washington itself is an ICBM away has not registered on the ignorant scum that rules Amerika. Overwhelmed by its hubris, Washington threatens all life on earth.
And Ed Steer's Report ......
http://www.caseyresearch.com/gsd/edition/ted-butler-the-new-law-of-supply-and-demand
¤ YESTERDAY IN GOLD & SILVER
With the U.S. closed on their Thursday, the gold price didn't do much. All that changed shortly after trading began in the Far East on their Friday morning...and by the 10:30 a.m. BST morning gold fix in London, the gold price was down twenty bucks from Tuesday's 5:15 p.m. EDT electronic close. From that low, gold rallied a bit until 8:30 a.m. in New York.
Then the jobs report came out...and someone hit the buy the dollar/sell gold button. The U.S. bond market got crushed as well.
The low tick of the day [$1,207.50 spot] came at the London p.m. gold fix at 3:00 p.m. BST...10:00 a.m. in New York.
The gold price recovered a bit from there, but then traded sideways from the London close until around 3:30 p.m. EDT. From there it rallied a few dollars into the close.
Gold finished the day on Friday at $1,223.80 spot...down $28.70 from Tuesday's close in New York. Net volume was a hair under 200,000 contracts...and that figure includes Thursday's volume as well.
It was pretty much the same chart pattern in silver, although it got hit much harder than gold did. But as you know by now, dear reader, this is JPMorgan's problem child...and they're obviously still chipping away at what's left of their grotesque short position in this metal.
The only difference between gold and silver's price pattern was the low tick in silver [$18.63 spot] came about 10:45 a.m. EDT...fifteen minutes before the London close...and not at the p.m. gold fix.
Silver finished the Friday session at $18.90 spot...down 82 cents from Tuesday. Silver's gross volumeon Thursday and Friday totaled 59,500 contracts.
The platinum and palladium charts look somewhat similar, although palladium's recovery was the most impressive of all four precious metals. Here are the charts...
Over the two days, gold closed down 2.29%...silver got clubbed for 4.16%...platinum closed lower by 1.42%...and palladium was down only 0.29%.
The dollar index closed on Tuesday at 83.24...and closed yesterday at 84.44...up 120 basis points, the gains just about evenly split between Thursday and Friday. With New York closed on Thursday, there was very little reaction by the precious metals to the 60 basis point rise in the index on that day. That situation was rectified yesterday.
Because of the holiday-shortened week, the CME's Daily Delivery Report wasn't much to see yesterday, as zero gold and 17 silver contracts were posted for delivery on Tuesday within the Comex-approved depositories. The link to yesterday's Issuers and Stoppers Report is here.
Like it has been all week...GLD went in one direction...and SLV went in the other on Friday. InGLD, an authorized participant withdrew 86,967 troy ounces...but in SLV an authorized participant[s] deposited a very chunky 2,894,736 troy ounces. During the first week of July just past, there have been withdrawals form GLD totaling 241,584 troy ounces. But in SLV for the week that was...4,680,551 troy ounces of silver have been deposited. If you're looking for a reason for this dichotomy...I don't have any answers for you.
Over at Switzerland's Zürcher Kantonalbank, they reported big sell offs in both their gold and silver ETFs for the week ending June 28th. In their gold ETF, it was 382,233 troy ounces...and in their silver ETF it was a very large 2,104,775 troy ounces. These are the biggest one-week sell offs in these two funds that I can remember...and one has to wonder who the new owners of all this metal are. I would guess that it's a bullion bank of some sort.
There was no sales report from the U.S. Mint again yesterday.
Over at the Comex-approved depositories on Wednesday, they didn't report receiving anysilver, but they did ship 560,847 troy ounces out the door. The link to that action is here.
In gold, these same depositories reported receiving 36,121 troy ounces...but they shipped out a chunky 152,057 troy ounces. The link to that activity is here.
As I've mentioned in every column this week...because of the U.S. holiday on Thursday, the COT Report and the Bank Participation Report won't be out until Monday...and I'll report on both in my Tuesday column.
I have two days' worth of stories...and despite taking an axe to the list, there are still a lot left, so the final edit is yours.
* * *
non redundant news and views.......
Doug Noland: Mispricing Risk
Bonds taken out to the woodshed, again.
U.S. bonds were crushed Friday on the back of stronger-than-expected payroll data. Long-bond yields jumped 21 bps to an almost 23-month high 3.71%. Ten-year yields rose 24 bps to 2.74% - the highest yields since August 5, 2011. Benchmark MBS yields surged 30 bps during the session to a 23-month high 3.69%. The spread between 10-year Treasury yields and benchmark MBS widened six on Friday to a one-year high 95 bps. Notably, MBS yields were up 75 bps in 14 sessions and 140 bps since May 1st.
"With unprecedented outflows from the bond complex coupled with notable global central bank selling, the Bubble in U.S. fixed income would appear in serious jeopardy. And while analysts and money managers will continue talk of a “fair value” range for Treasury securities, for the time being flow of funds analysis trumps valuation. Will foreign central banks continue reducing their enormous holdings of U.S. Treasury and Agency securities? How much leverage has accumulated throughout U.S. fixed income – especially in corporates, MBS and municipal debt? How long until some hedge funds are in trouble? Redemptions coming? Derivative problems? Will investors continue their retreat from U.S. fixed income mutual funds and ETFs?
"As noted in my “Issues 2013” CBB from early January: A market Bubble implies bipolar outcome possibilities. Either the entrenched Bubble bursts or it becomes an issue of “how crazy do things get?” If the U.S. stock market has evolved into the speculative Bubble of choice, there are a couple things the Fed might contemplate. First, QE may now work to spur similar late-cycle speculative excesses that are now coming home to roost throughout the fixed income universe. Second, inflating stock prices may work to pull additional liquidity away from an already liquidity-challenged bond market. It is, after all, the nature of liquidity to seek the inflating asset market."
Doug's Credit Bubble Bulletin from yesterday...always a must read for me.
Toronto Reviews Bid to Become Yuan Currency Trading Hub
Some of Canada’s largest banks, insurance companies and pension funds met with government representatives and the Bank of Canada in Toronto on June 21 to discuss establishing a yuan trading hub, according to the Toronto Financial Services Alliance, an industry group that set up the meeting.
Representatives of Chinese banks also attended the meeting, the group said, declining to name them. “There’s been expressions of interest from some companies,” said Janet Ecker, president of the finance group, who attended the meeting. “We’ve seen what’s happened in London and Singapore and Hong Kong.”
This Bloomberg story, filed from Toronto, was posted on their website early yesterday morning MDT...and it's courtesy of reader 'David in California'.
QEternity for Europe and U.K.
President Mario Draghi said the European Central Bank expects to keep interest rates low for an "extended period" as he tries to restrain market borrowing costs, in a new departure for an institution averse to setting policy in advance.
With ECB officials today leaving their main refinancing rate at 0.5 percent, Draghi fleshed out their outlook for monetary policy after investors pushed up long-term bond yields, threatening the region's economic recovery. The statement came on the same day that the Bank of England also tried to manage investor expectations in Mark Carney's first week as governor.
"The Governing Council expects the key ECB interest rates to remain at present or lower levels for an extended period of time," Draghi said at a press conference in Frankfurt. "What the Governing Council did today was to inject a downward bias in interest rates for the foreseeable future. Our exit is very distant."
This is another Bloomberg story, this one posted on their Internet site early on Thursday morning MDT...and I found it in a GATA release. It's definitely worth reading.
EU Parliament Urges Blocking US Data Access After Spy Leaks
The European Parliament called on Thursday for the scrapping of two agreements granting the United States access to European financial and travel data unless Washington reveals the extent of its electronic spying operations in Europe.
A non-binding resolution, passed by 483 votes to 98 with 65 abstentions, said the United States should come clean about its surveillance of email and communications data or risk seeing the transatlantic information-sharing deals, created in the wake of the September 11 attacks, torn up.
The parliament cannot revoke the agreements without the support of European Union governments and the bloc's executive Commission, which looks unlikely.
This is all for show...and public consumption. Absolutely nothing will change. This Reuters article, filed from Brussels on Wednesday, is courtesy of Manitoba reader Ulrike Marx.
Lawlessness Is the New Normal — Paul Craig Roberts
In various articles and in my latest book, The Failure of Laissez Faire Capitalism And Economic Dissolution Of The West, I have pointed out that the European sovereign debt crisis is being used to terminate the sovereignty of the countries that are members of the EU. There is no doubt that this is true, but the sovereignty of the EU member states is only nominal. Although the individual countries still retain some sovereignty from the EU government, they are all under Washington’s thumb, as demonstrated by the recent illegal and hostile action taken on Washington’s orders by France, Italy, Spain, Portugal, and Austria against the airliner carrying Bolivia’s President Evo Morales.
Flying back to Bolivia from Moscow, Morales’ plane was denied over flight and refueling permission by Washington’s French, Italian, Spanish, and Portuguese puppets and had to land in Austria, where the presidential plane was searched for Edward Snowden. It was a power play by Washington to kidnap Snowden from Bolivia’s presidential airliner in defiance of international law and to teach upstart reformers like Morales that independence from Washington’s orders is not permitted.
The European puppet states went along with this extraordinary breach of diplomacy and international law despite the fact that each of the countries is incensed that Washington is spying on their governments, diplomats, and citizens. Their thanks to Snowden, whose revelations made them aware that Washington was recording their every communication, was to help Washington capture Snowden.
This tells us how much morality, honor, integrity there is left in Western civilization: Zero.
This must read commentary was posted on Paul's website yesterday...and is probably one of the most important items in today's column. I thank Ulrike Marx for bringing it to my attention...and now to yours.
Argentina Applies Law That Jails Hoarders as Bread Surges
Argentina plans to apply a law that forces holders of wheat and flour suitable for bread making to sell stock on the domestic market in a bid to contain inflation.
Interior Commerce Secretary Guillermo Moreno announced the measure in the official gazette today. The 1974 law allows authorities to freeze prices and obliges companies to maintain supply. Those in breach are subject to fines and imprisonment.
“If the law on supply is applied, the one who should go to jail is Moreno himself,” former Economy Minister Martin Lousteau said in an interview with Radio Mitre today. “He’s to blame for the lack of wheat in Argentina.”
This Bloomberg article was filed from Buenos Aires...and posted on their Internet site late yesterday morning MDT. It's the second offering in today's column from reader 'David in California'.
Egypt's Cunning General: How the Military Plans to Keep Power
Adly Mansour's rise to power has been a rapid one. On Monday, the career judge was sworn in as chief justice of Egypt's Supreme Constitutional Court. ByWednesday night, President Mohammed Morsi had been deposed, the constitution suspended, and Mansour was declared the country's new interim leader, set to be sworn in on Thursday. Along with a cabinet of technocrats, he'll govern the country until new elections.
But no one knows if and when these elections might take place. And Mansour won't be Egypt's most important man, even if the justice, who served in the country's top court under deposed autocrat Hosni Mubarak, now calls himself head of state. That's because behind the scenes, the military, led by General Abdel-Fattah el-Sissi, plans to continue running the show.
Since it took power in a coup in 1952, the military has remained the most important political player in Egypt. Neither Mubarak's fall in 2011, nor the short rule by Morsi, a member of the Muslim Brotherhood, have changed this. El-Sissi demonstrated just how powerful the influence of the military's generals is on Wednesday night, when, after giving Morsi 48 hours to leave office, he summarily informed the president that he was no longer the leader of the country. No matter that Morsi was the country's first democratically elected head of state.
This story appeared on the German website spiegel.de late Thursday morning Europe time...and I thank Roy Stephens once again.
It Is Now Common Knowledge That US Drones Bomb Civilian Rescuers
Taliban commanders and security officials told Reuters that the strike mostly killed fighters for the Haqqani network.
Many were wounded in the attack, local tribesman Kaleemullah Dawar said, but rescuers delayed for fear of falling victim to a second attack, a common tactic with drone strikes. That tactic is known as the "double tap," which bombs multiple targets in relatively quick succession — meaning that the second strike often hits first responders.
The NYU/Stanford report stated: "As international law experts have noted, intentional strikes on first responders may constitute war crimes." The fact that it is now normalized as a common tactic of the U.S. drone war is stunning.
This story also from the businessinsider.com Internet site on Wednesday...and another article that I've saved for Saturday. It's a must read for all serious students of the New Great Game...and it represents Roy Stephens' final offering in today's column.
China Signals Will Cut Off Credit to Rebalance Economy
In a statement from the State Council, or cabinet, Beijing laid out broad plans to ensure banks support the kind of economic rebalancing China's new leadership wants as it looks to focus more on high-end manufacturing.
President Xi Jinping and Premier Li Keqiang have flagged for some time that the rapid growth of the past three decades needs to shift down a gear, and analysts said Friday's announcement was a signal that they intended to press on with reforms despite evidence of a sharper-than-expected slowdown.
"The guideline shows China's policymakers will focus more on economic restructuring to stabilize the economy rather than providing more liquidity to support economic growth," said Li Huiyong, an economist at Shenyin Wanguo Securities in Shanghai.
This Reuters story, filed from Beijing, was posted on their website early yesterday morning EDT...and I thank Ulrike Marx for another contribution to today's column.
Six King World News Blogs
1. Citi analyst Tom Fitzpatrick: "4 Absolutely Spectacular Gold Charts and Commentary". 2. John Williams: "We Are Beginning to Approach the End Game". 3. Dr. Benn Steil: "Gold, Financial War and the Fed's Dangerous Exit Strategy". 4. Dr. Marc Faber: "This Will End in Disaster". 5. Egon von Greyerz: "Gold and Silver Smash and Fires Burning Everywhere in the World". 6. Dr. Stephen Leeb: "Gold and a Global Financial System in Complete Turmoil".
The Smart Money Is Quietly Buying More Gold
There are also some seriously credible professionals currently buying, albeit quietly. One is Sebastian Lyon, the fund manager overseeing Personal Assets Trust, a unique, quoted £600m investment fund whose overriding aim is to preserve shareholders' capital.
The board of Personal Assets is so hell-bent on its cautious, wealth-preserving tack that it boasts about having missed stock market rallies. In its own words, it is a "tiresome holding for lovers of excitement and adventure, who will find it unbearable to see us sitting on the sidelines while the FTSE climbs tantalisingly to its peak".
Personal Assets Trust's excellent performance during the worst of the crisis was largely due to its big investment in bullion – currently more than 12pc of its portfolio. In recent months, as the price has fallen, Mr. Lyon has topped up gold holdings. That someone who follows such a cautious mandate, and has done so with such success, is today a buyer of gold is worth noting.
This commentary showed up on the telegraph.co.uk Internet site early yesterday evening BST...and it's worth skimming. I thank reader 'Roger B' for sending it our way.
Gold Jewellery Stocks Hammered in India
Gold jewellery stocks are in a free-fall in India. The curbs imposed by the Indian government and the Reserve Bank of India to curtail domestic gold consumption and imports, has led to a hammering of stock prices. Some leading jewellers shares have dived by 20% to 50% during the past fortnight.
Analysts attribute the mayhem to the fact that most gold retailers in India hold huge inventories of gold. Since the price of gold has slid in the international market, this has resulted in a huge depreciation in the value of the gold inventory held by bullion companies.
Shares of Gitanjali Gems, touted as India’s largest gold and jewellery company, have slumped more than 60% since mid-June with investors preferring to bail out even on July 4.
This interesting story, filed from Mumbai, was posted on the mineweb.comInternet site on Thursday...and my thanks go out to Ulrike Marx for passing it along.
Credit Card Transactions for Gold Purchases Curtailed in India
Buying gold in India has got a little more difficult for consumers used to using plastic money to buy large jewellery sets or heavy gold ornaments. India's apex bank has asked banks not to convert gold purchases done through credit cards into equated monthly installments.
Continuing its fight against gold consumption, the Reserve Bank of India is leaving no stone unturned to discourage gold buyers in India. The ban on conversion of gold purchases at jewellery stores into equated monthly instalments for credit card purchases has already triggered a slump in sales.
"The central bank has asked banks to stop accepting credit card purchases for gold. We only realised this when customers who fished out their credit card for high value transactions at our stores could not carry through the order. In the last 48 hours, sales have dipped over 25%," said Manmohan Gandhi, bullion retailer.
This is another story posted on the mineweb.com Internet site. This one was filed from Mumbai yesterday...and I thank Ulrike Marx for her final offering in today's column.
¤ THE WRAP
Irrespective of the sharp decline in the price of gold, physical gold—held for the long term—remains the primary hedge against the U.S. dollar debasement ahead. Yet, it has to be in place, and it has to be held through the developing crises—irrespective of short-term market volatility—in order to provide the desired asset protection. Whether gold is purchased at $250, $2,500 or $25,000 per ounce, it preserves the purchasing power of the dollars invested. Someone looking to take profits at $100,000 an ounce is missing what has happened. Those “profits” are just the preserved purchasing power of the invested dollars. - John Williams...shadowstats.com...3
Has Washington’s Arrogance Undone Its Empire?
Paul Craig Roberts
No one likes a bully, and Washington’s NATO puppets have been bullied for six decades. British prime ministers, German chancellors, and French presidents have to salute and say “yes sir.”
They all hate it, but they love Washington’s money; so they prostitute themselves and their countries for Washington’s money. Even a person of Winston Churchill’s stature had to suck up to Washington in order to get his bills and his country’s bills paid.
But what the bought European leaders are finding is that Washington doesn’t pay enough for the prostitution required. One year out of office Tony Blair was worth $35 million dollars. But that’s not enough to get Blair on the waiting list for $50 million 200 foot yachts, to have a chalet in Gstaad, $50 million penthouses in Paris and New York, and a private plane to fly between them, or to wear a $736,000 Franck Muller watch on his wrist, sign his name with a $700,000 Mont Blanc jewel-encrusted pen, and drink $10,000 “martinis on a rock” (gin or vodka poured over a diamond) at New York’s Algonquin Hotel.
In a world in which every member of the Forbes Four Hundred is a billionaire plus or multi-billionaire, $35,000,000 just doesn’t cut it. In 2006 the manager of one hedge fund was paid $1,700,000,000 for one year’s thieving. Another 25 were paid $575,000,000 for their skills in front-running trades. $35 million is probably the annual budget for their household servants.
The British seem content in their role as Washington’s favorite lackey, but France and Germany have not enjoyed that role. France’s last real leader, General de Gaulle, would have nothing to do with it and refused to join NATO. Germany, dismembered with East Germany occupied by the Soviets, had no choice. Germans’ gratitude to President Reagan for their unification resulted in re-unified Germany falling under Washington’s hegemony.
However, if news reports from Berlin are true, Germany has had enough. The catalyst was Edward Snowden’s revelations that Washington spies on everyone including its allies, both Germany and the EU in particular. Moreover, Washington uses Britain as the Trojan Horse within the EU as a backup spy in case NSA misses something.
According to news reports, the German, French, and EU governments are upset to find out that their extreme subservience to Washington has not protected them and their citizens from being spied upon. Here they are, fighting Washington’s wars in far distant Afghanistan, the fate of which is completely unrelated to their own, and what does Washington do but embarrass them by spying on the personal lives of their citizens.
Who does the Merkel government represent, Germans are asking, Germans or the NSA? Why does the Merkel government kowtow to Washington? The next question will be: “what does Washington’s spies have on Merkel?”
With the German government put on the spot by Washington’s betrayal, news headlines are: “Germany Ready to Charge UK and US Intelligence Over Bugging Operations.”
Little wonder Washington and its media whores hate Edward Snowden. “A spokesman for the [German] Federal Prosecutor said the office was preparing to bring charges against” the UK and US intelligence services. In light of the Snowden affair, it will be wonderful if Germany issues arrest warrants and Washington and London refuse to extradite its NSA and UK spy operatives who have violated every law and every trust.
The German Justice Minister, Sabine Leutheusser-Schnarrenburger, demanded an “immediate explanation” why Washington was applying to Germany policies “reminiscent of the actions against enemies during the Cold War.”
The president of France has said that France will not again cooperate with Washington on any issue until France receives “full assurances” that Washington will cease spying on France.
The president of the European Parliament, Martin Schulz, and the EU Commissioner for Justice, Viviane Reding, demand Washington’s answer to Snowden’s revelations that Washington has betrayed its own allies.
The question that must be asked is: do any of these protests from politicians who are
almost certain to be on Washington’s payroll mean anything, or are they just make-believe protests to quiet the domestic European populations who have been betrayed by their elected leaders? Why would the French president and the German justice minister think any reassurance from Washington meant anything? When in human memory has Washington told the truth about anything? When has Washington’s reassurance meant anything?
almost certain to be on Washington’s payroll mean anything, or are they just make-believe protests to quiet the domestic European populations who have been betrayed by their elected leaders? Why would the French president and the German justice minister think any reassurance from Washington meant anything? When in human memory has Washington told the truth about anything? When has Washington’s reassurance meant anything?
The Tonkin Gulf? Iraqi weapons of mass destruction? Iranian nukes? Assad’s sarin gas attack? FBI orchestrated “terror attacks”? It is a proven fact that the US government lies every time it opens its mouth. Compared to Washington, Stalin, Hitler, Tojo, Mao, Castro, Chavez, and Pol Pot were truthful.
Washington’s reply to Europe’s demands for explanation is: “We will discuss these issues bilaterally with EU member states,” but “we are not going to comment publicly on specific alleged intelligence activities.”
You know what that means. Bilateral means that Washington is going to talk with each EU country separately, using the information NSA has obtained to blackmail each complainant into silence. Whereas the EU together could stand up to Washington, separately the countries can be browbeat and offered more money or threats that illicit love affairs will be revealed to shut them up. Washington is betting on its power to intimidate individual countries with the threat of isolation and being cut off from money. If the EU countries agree to the secret bilateral explanations from Washington, the affair will end and the spying on Europe will continue while Washington and the EU politicians deny that the spying continues.
By now the entire world must know that Washington is not merely lawless, but also totally out of control, reveling in arrogance and hubris, driven by desires for hegemony over the entire world. Washington is so paranoid and distrustful that it doesn’t even trust its own citizens or the European puppet governments that it has bought and paid for.
Washington is the only government that has ever used nuclear weapons, and Washington used them against a defeated government that was trying to surrender. Today the craziness in Washington is much worse. Decision-making councils are full of crazed neoconservative war-mongers, such as National Security Advisor Susan Rice, a threat to humanity. Washington think tanks and media are over-represented by neoconservatives such as William Kristol who wants to know “what good are nuclear weapons if you can’t use them?”
The sleazy European politicians and media who took Washington’s money provided for their own economic security, but they betrayed the security of the entire world. By enabling Washington’s hegemony, they unleashed Washington’s arrogance. This arrogance now threatens not merely the independence of every country but life on earth.
Instead of meeting unilaterally alone with Washington, the European countries should
stand together. After all, supposedly there is an EU. If there is an EU, Washington should meet with the EU, not with its constituent parts individually, no one of which can stand up to Washington’s intimidation and bribes.
stand together. After all, supposedly there is an EU. If there is an EU, Washington should meet with the EU, not with its constituent parts individually, no one of which can stand up to Washington’s intimidation and bribes.
If thermo-nuclear war is to be avoided and life is to continue on earth, Europe must disband NATO. The North Atlantic Treaty Organization was formed in the aftermath of World War II. Its purpose was to prevent the powerful Red Army, which defeated Nazi Germany, from overrunning all of Western Europe.
The Soviet Union collapsed in 1991, 22 years ago. Yet, NATO still exists. Moreover, against President Reagan’s intentions, NATO has grown. NATO now includes former constituent parts of the Soviet Empire, such as Eastern Europe, and former constituent parts of the Soviet Union itself, such as Georgia, the government of which is bought and paid for by Washington. The NGOs that Washington funds might even deliver Ukraine into Washington’s fold.
Egged on by Washington, Georgia initiated a war with present day Russia, which superior Russian forces quickly ended. In the opinion of many, the Russian government showed far too much tolerance for its defeated enemy, which is being rearmed by Washington and encouraged into new military adventures. Washington is working to make Georgia, located in Asia between the Black and Caspian seas, a member of the North Atlantic Treaty Organization. NATO membership would make Georgia a treaty protectorate of Washington and its NATO puppets. Washington thinks that this elevation of Georgia would result in Russia acquiescing to Georgian aggression in order to avoid war with the US and NATO.
China, also, has been amazingly abused by Washington, and instead of replying in kind, has taken it in stride. This magnanimity on the part of the Chinese has been misinterpreted by Washington as fear. The fear that Washington imagines is causing China to quake in its boots has encouraged Washington to surround China with new naval, air, and troop bases. The fact that however numerous are Washington’s bases in the Pacific and South China Sea, Washington itself is an ICBM away has not registered on the ignorant scum that rules Amerika. Overwhelmed by its hubris, Washington threatens all life on earth.
And Ed Steer's Report ......
http://www.caseyresearch.com/gsd/edition/ted-butler-the-new-law-of-supply-and-demand
¤ YESTERDAY IN GOLD & SILVER
With the U.S. closed on their Thursday, the gold price didn't do much. All that changed shortly after trading began in the Far East on their Friday morning...and by the 10:30 a.m. BST morning gold fix in London, the gold price was down twenty bucks from Tuesday's 5:15 p.m. EDT electronic close. From that low, gold rallied a bit until 8:30 a.m. in New York.
Then the jobs report came out...and someone hit the buy the dollar/sell gold button. The U.S. bond market got crushed as well.
The low tick of the day [$1,207.50 spot] came at the London p.m. gold fix at 3:00 p.m. BST...10:00 a.m. in New York.
The gold price recovered a bit from there, but then traded sideways from the London close until around 3:30 p.m. EDT. From there it rallied a few dollars into the close.
Gold finished the day on Friday at $1,223.80 spot...down $28.70 from Tuesday's close in New York. Net volume was a hair under 200,000 contracts...and that figure includes Thursday's volume as well.
It was pretty much the same chart pattern in silver, although it got hit much harder than gold did. But as you know by now, dear reader, this is JPMorgan's problem child...and they're obviously still chipping away at what's left of their grotesque short position in this metal.
The only difference between gold and silver's price pattern was the low tick in silver [$18.63 spot] came about 10:45 a.m. EDT...fifteen minutes before the London close...and not at the p.m. gold fix.
Silver finished the Friday session at $18.90 spot...down 82 cents from Tuesday. Silver's gross volumeon Thursday and Friday totaled 59,500 contracts.
The platinum and palladium charts look somewhat similar, although palladium's recovery was the most impressive of all four precious metals. Here are the charts...
Over the two days, gold closed down 2.29%...silver got clubbed for 4.16%...platinum closed lower by 1.42%...and palladium was down only 0.29%.
The dollar index closed on Tuesday at 83.24...and closed yesterday at 84.44...up 120 basis points, the gains just about evenly split between Thursday and Friday. With New York closed on Thursday, there was very little reaction by the precious metals to the 60 basis point rise in the index on that day. That situation was rectified yesterday.
Because of the holiday-shortened week, the CME's Daily Delivery Report wasn't much to see yesterday, as zero gold and 17 silver contracts were posted for delivery on Tuesday within the Comex-approved depositories. The link to yesterday's Issuers and Stoppers Report is here.
Like it has been all week...GLD went in one direction...and SLV went in the other on Friday. InGLD, an authorized participant withdrew 86,967 troy ounces...but in SLV an authorized participant[s] deposited a very chunky 2,894,736 troy ounces. During the first week of July just past, there have been withdrawals form GLD totaling 241,584 troy ounces. But in SLV for the week that was...4,680,551 troy ounces of silver have been deposited. If you're looking for a reason for this dichotomy...I don't have any answers for you.
Over at Switzerland's Zürcher Kantonalbank, they reported big sell offs in both their gold and silver ETFs for the week ending June 28th. In their gold ETF, it was 382,233 troy ounces...and in their silver ETF it was a very large 2,104,775 troy ounces. These are the biggest one-week sell offs in these two funds that I can remember...and one has to wonder who the new owners of all this metal are. I would guess that it's a bullion bank of some sort.
There was no sales report from the U.S. Mint again yesterday.
Over at the Comex-approved depositories on Wednesday, they didn't report receiving anysilver, but they did ship 560,847 troy ounces out the door. The link to that action is here.
In gold, these same depositories reported receiving 36,121 troy ounces...but they shipped out a chunky 152,057 troy ounces. The link to that activity is here.
As I've mentioned in every column this week...because of the U.S. holiday on Thursday, the COT Report and the Bank Participation Report won't be out until Monday...and I'll report on both in my Tuesday column.
I have two days' worth of stories...and despite taking an axe to the list, there are still a lot left, so the final edit is yours.
* * *
non redundant news and views.......
Doug Noland: Mispricing Risk
Bonds taken out to the woodshed, again.
U.S. bonds were crushed Friday on the back of stronger-than-expected payroll data. Long-bond yields jumped 21 bps to an almost 23-month high 3.71%. Ten-year yields rose 24 bps to 2.74% - the highest yields since August 5, 2011. Benchmark MBS yields surged 30 bps during the session to a 23-month high 3.69%. The spread between 10-year Treasury yields and benchmark MBS widened six on Friday to a one-year high 95 bps. Notably, MBS yields were up 75 bps in 14 sessions and 140 bps since May 1st.
"With unprecedented outflows from the bond complex coupled with notable global central bank selling, the Bubble in U.S. fixed income would appear in serious jeopardy. And while analysts and money managers will continue talk of a “fair value” range for Treasury securities, for the time being flow of funds analysis trumps valuation. Will foreign central banks continue reducing their enormous holdings of U.S. Treasury and Agency securities? How much leverage has accumulated throughout U.S. fixed income – especially in corporates, MBS and municipal debt? How long until some hedge funds are in trouble? Redemptions coming? Derivative problems? Will investors continue their retreat from U.S. fixed income mutual funds and ETFs?
U.S. bonds were crushed Friday on the back of stronger-than-expected payroll data. Long-bond yields jumped 21 bps to an almost 23-month high 3.71%. Ten-year yields rose 24 bps to 2.74% - the highest yields since August 5, 2011. Benchmark MBS yields surged 30 bps during the session to a 23-month high 3.69%. The spread between 10-year Treasury yields and benchmark MBS widened six on Friday to a one-year high 95 bps. Notably, MBS yields were up 75 bps in 14 sessions and 140 bps since May 1st.
"With unprecedented outflows from the bond complex coupled with notable global central bank selling, the Bubble in U.S. fixed income would appear in serious jeopardy. And while analysts and money managers will continue talk of a “fair value” range for Treasury securities, for the time being flow of funds analysis trumps valuation. Will foreign central banks continue reducing their enormous holdings of U.S. Treasury and Agency securities? How much leverage has accumulated throughout U.S. fixed income – especially in corporates, MBS and municipal debt? How long until some hedge funds are in trouble? Redemptions coming? Derivative problems? Will investors continue their retreat from U.S. fixed income mutual funds and ETFs?
"As noted in my “Issues 2013” CBB from early January: A market Bubble implies bipolar outcome possibilities. Either the entrenched Bubble bursts or it becomes an issue of “how crazy do things get?” If the U.S. stock market has evolved into the speculative Bubble of choice, there are a couple things the Fed might contemplate. First, QE may now work to spur similar late-cycle speculative excesses that are now coming home to roost throughout the fixed income universe. Second, inflating stock prices may work to pull additional liquidity away from an already liquidity-challenged bond market. It is, after all, the nature of liquidity to seek the inflating asset market."
Doug's Credit Bubble Bulletin from yesterday...always a must read for me.
Toronto Reviews Bid to Become Yuan Currency Trading Hub
Some of Canada’s largest banks, insurance companies and pension funds met with government representatives and the Bank of Canada in Toronto on June 21 to discuss establishing a yuan trading hub, according to the Toronto Financial Services Alliance, an industry group that set up the meeting.
Representatives of Chinese banks also attended the meeting, the group said, declining to name them. “There’s been expressions of interest from some companies,” said Janet Ecker, president of the finance group, who attended the meeting. “We’ve seen what’s happened in London and Singapore and Hong Kong.”
This Bloomberg story, filed from Toronto, was posted on their website early yesterday morning MDT...and it's courtesy of reader 'David in California'.
QEternity for Europe and U.K.
President Mario Draghi said the European Central Bank expects to keep interest rates low for an "extended period" as he tries to restrain market borrowing costs, in a new departure for an institution averse to setting policy in advance.
With ECB officials today leaving their main refinancing rate at 0.5 percent, Draghi fleshed out their outlook for monetary policy after investors pushed up long-term bond yields, threatening the region's economic recovery. The statement came on the same day that the Bank of England also tried to manage investor expectations in Mark Carney's first week as governor.
"The Governing Council expects the key ECB interest rates to remain at present or lower levels for an extended period of time," Draghi said at a press conference in Frankfurt. "What the Governing Council did today was to inject a downward bias in interest rates for the foreseeable future. Our exit is very distant."
This is another Bloomberg story, this one posted on their Internet site early on Thursday morning MDT...and I found it in a GATA release. It's definitely worth reading.
EU Parliament Urges Blocking US Data Access After Spy Leaks
The European Parliament called on Thursday for the scrapping of two agreements granting the United States access to European financial and travel data unless Washington reveals the extent of its electronic spying operations in Europe.
A non-binding resolution, passed by 483 votes to 98 with 65 abstentions, said the United States should come clean about its surveillance of email and communications data or risk seeing the transatlantic information-sharing deals, created in the wake of the September 11 attacks, torn up.
The parliament cannot revoke the agreements without the support of European Union governments and the bloc's executive Commission, which looks unlikely.
This is all for show...and public consumption. Absolutely nothing will change. This Reuters article, filed from Brussels on Wednesday, is courtesy of Manitoba reader Ulrike Marx.
Lawlessness Is the New Normal — Paul Craig Roberts
In various articles and in my latest book, The Failure of Laissez Faire Capitalism And Economic Dissolution Of The West, I have pointed out that the European sovereign debt crisis is being used to terminate the sovereignty of the countries that are members of the EU. There is no doubt that this is true, but the sovereignty of the EU member states is only nominal. Although the individual countries still retain some sovereignty from the EU government, they are all under Washington’s thumb, as demonstrated by the recent illegal and hostile action taken on Washington’s orders by France, Italy, Spain, Portugal, and Austria against the airliner carrying Bolivia’s President Evo Morales.
Flying back to Bolivia from Moscow, Morales’ plane was denied over flight and refueling permission by Washington’s French, Italian, Spanish, and Portuguese puppets and had to land in Austria, where the presidential plane was searched for Edward Snowden. It was a power play by Washington to kidnap Snowden from Bolivia’s presidential airliner in defiance of international law and to teach upstart reformers like Morales that independence from Washington’s orders is not permitted.
The European puppet states went along with this extraordinary breach of diplomacy and international law despite the fact that each of the countries is incensed that Washington is spying on their governments, diplomats, and citizens. Their thanks to Snowden, whose revelations made them aware that Washington was recording their every communication, was to help Washington capture Snowden.
This tells us how much morality, honor, integrity there is left in Western civilization: Zero.
This must read commentary was posted on Paul's website yesterday...and is probably one of the most important items in today's column. I thank Ulrike Marx for bringing it to my attention...and now to yours.
Argentina Applies Law That Jails Hoarders as Bread Surges
Argentina plans to apply a law that forces holders of wheat and flour suitable for bread making to sell stock on the domestic market in a bid to contain inflation.
Interior Commerce Secretary Guillermo Moreno announced the measure in the official gazette today. The 1974 law allows authorities to freeze prices and obliges companies to maintain supply. Those in breach are subject to fines and imprisonment.
“If the law on supply is applied, the one who should go to jail is Moreno himself,” former Economy Minister Martin Lousteau said in an interview with Radio Mitre today. “He’s to blame for the lack of wheat in Argentina.”
This Bloomberg article was filed from Buenos Aires...and posted on their Internet site late yesterday morning MDT. It's the second offering in today's column from reader 'David in California'.
Egypt's Cunning General: How the Military Plans to Keep Power
Adly Mansour's rise to power has been a rapid one. On Monday, the career judge was sworn in as chief justice of Egypt's Supreme Constitutional Court. ByWednesday night, President Mohammed Morsi had been deposed, the constitution suspended, and Mansour was declared the country's new interim leader, set to be sworn in on Thursday. Along with a cabinet of technocrats, he'll govern the country until new elections.
But no one knows if and when these elections might take place. And Mansour won't be Egypt's most important man, even if the justice, who served in the country's top court under deposed autocrat Hosni Mubarak, now calls himself head of state. That's because behind the scenes, the military, led by General Abdel-Fattah el-Sissi, plans to continue running the show.
Since it took power in a coup in 1952, the military has remained the most important political player in Egypt. Neither Mubarak's fall in 2011, nor the short rule by Morsi, a member of the Muslim Brotherhood, have changed this. El-Sissi demonstrated just how powerful the influence of the military's generals is on Wednesday night, when, after giving Morsi 48 hours to leave office, he summarily informed the president that he was no longer the leader of the country. No matter that Morsi was the country's first democratically elected head of state.
This story appeared on the German website spiegel.de late Thursday morning Europe time...and I thank Roy Stephens once again.
It Is Now Common Knowledge That US Drones Bomb Civilian Rescuers
Taliban commanders and security officials told Reuters that the strike mostly killed fighters for the Haqqani network.
Many were wounded in the attack, local tribesman Kaleemullah Dawar said, but rescuers delayed for fear of falling victim to a second attack, a common tactic with drone strikes. That tactic is known as the "double tap," which bombs multiple targets in relatively quick succession — meaning that the second strike often hits first responders.
The NYU/Stanford report stated: "As international law experts have noted, intentional strikes on first responders may constitute war crimes." The fact that it is now normalized as a common tactic of the U.S. drone war is stunning.
This story also from the businessinsider.com Internet site on Wednesday...and another article that I've saved for Saturday. It's a must read for all serious students of the New Great Game...and it represents Roy Stephens' final offering in today's column.
China Signals Will Cut Off Credit to Rebalance Economy
In a statement from the State Council, or cabinet, Beijing laid out broad plans to ensure banks support the kind of economic rebalancing China's new leadership wants as it looks to focus more on high-end manufacturing.
President Xi Jinping and Premier Li Keqiang have flagged for some time that the rapid growth of the past three decades needs to shift down a gear, and analysts said Friday's announcement was a signal that they intended to press on with reforms despite evidence of a sharper-than-expected slowdown.
"The guideline shows China's policymakers will focus more on economic restructuring to stabilize the economy rather than providing more liquidity to support economic growth," said Li Huiyong, an economist at Shenyin Wanguo Securities in Shanghai.
This Reuters story, filed from Beijing, was posted on their website early yesterday morning EDT...and I thank Ulrike Marx for another contribution to today's column.
Six King World News Blogs
1. Citi analyst Tom Fitzpatrick: "4 Absolutely Spectacular Gold Charts and Commentary". 2. John Williams: "We Are Beginning to Approach the End Game". 3. Dr. Benn Steil: "Gold, Financial War and the Fed's Dangerous Exit Strategy". 4. Dr. Marc Faber: "This Will End in Disaster". 5. Egon von Greyerz: "Gold and Silver Smash and Fires Burning Everywhere in the World". 6. Dr. Stephen Leeb: "Gold and a Global Financial System in Complete Turmoil".
The Smart Money Is Quietly Buying More Gold
There are also some seriously credible professionals currently buying, albeit quietly. One is Sebastian Lyon, the fund manager overseeing Personal Assets Trust, a unique, quoted £600m investment fund whose overriding aim is to preserve shareholders' capital.
The board of Personal Assets is so hell-bent on its cautious, wealth-preserving tack that it boasts about having missed stock market rallies. In its own words, it is a "tiresome holding for lovers of excitement and adventure, who will find it unbearable to see us sitting on the sidelines while the FTSE climbs tantalisingly to its peak".
Personal Assets Trust's excellent performance during the worst of the crisis was largely due to its big investment in bullion – currently more than 12pc of its portfolio. In recent months, as the price has fallen, Mr. Lyon has topped up gold holdings. That someone who follows such a cautious mandate, and has done so with such success, is today a buyer of gold is worth noting.
This commentary showed up on the telegraph.co.uk Internet site early yesterday evening BST...and it's worth skimming. I thank reader 'Roger B' for sending it our way.
Gold Jewellery Stocks Hammered in India
Gold jewellery stocks are in a free-fall in India. The curbs imposed by the Indian government and the Reserve Bank of India to curtail domestic gold consumption and imports, has led to a hammering of stock prices. Some leading jewellers shares have dived by 20% to 50% during the past fortnight.
Analysts attribute the mayhem to the fact that most gold retailers in India hold huge inventories of gold. Since the price of gold has slid in the international market, this has resulted in a huge depreciation in the value of the gold inventory held by bullion companies.
Shares of Gitanjali Gems, touted as India’s largest gold and jewellery company, have slumped more than 60% since mid-June with investors preferring to bail out even on July 4.
This interesting story, filed from Mumbai, was posted on the mineweb.comInternet site on Thursday...and my thanks go out to Ulrike Marx for passing it along.
Credit Card Transactions for Gold Purchases Curtailed in India
Buying gold in India has got a little more difficult for consumers used to using plastic money to buy large jewellery sets or heavy gold ornaments. India's apex bank has asked banks not to convert gold purchases done through credit cards into equated monthly installments.
Continuing its fight against gold consumption, the Reserve Bank of India is leaving no stone unturned to discourage gold buyers in India. The ban on conversion of gold purchases at jewellery stores into equated monthly instalments for credit card purchases has already triggered a slump in sales.
"The central bank has asked banks to stop accepting credit card purchases for gold. We only realised this when customers who fished out their credit card for high value transactions at our stores could not carry through the order. In the last 48 hours, sales have dipped over 25%," said Manmohan Gandhi, bullion retailer.
This is another story posted on the mineweb.com Internet site. This one was filed from Mumbai yesterday...and I thank Ulrike Marx for her final offering in today's column.
¤ THE WRAP
Irrespective of the sharp decline in the price of gold, physical gold—held for the long term—remains the primary hedge against the U.S. dollar debasement ahead. Yet, it has to be in place, and it has to be held through the developing crises—irrespective of short-term market volatility—in order to provide the desired asset protection. Whether gold is purchased at $250, $2,500 or $25,000 per ounce, it preserves the purchasing power of the dollars invested. Someone looking to take profits at $100,000 an ounce is missing what has happened. Those “profits” are just the preserved purchasing power of the invested dollars. - John Williams...shadowstats.com...3
Here's a "blast from the past" that I haven't posted for many a year...and it deserves that honour again. This American jazz rock/rock band had their heyday in the 1970s...and this was by far and away their biggest hit. Turn your speakers up...and then click here.
Today's classical selection is another work that has graced this column in the past as well.
The premiere was on 2 July 1900 in Helsinki with the Helsinki Philharmonic Society conducted by Robert Kajanus.
A recurrent joke within Finland at this time was the renaming of Finlandia at various musical concerts so as to avoid Russian censorship. Titles under which the piece masqueraded were numerous, a famously flippant example being Happy Feelings at the Awakening of Finnish Spring.
Most of the piece is taken up with rousing and turbulent music, evoking the national struggle of the Finnish people. But towards the end, a calm comes over the orchestra, and the serenely melodic Finlandia Hymn is heard. Often incorrectly cited as a traditional folk melody, the Hymn section is of Sibelius's own creation.
It takes a big orchestra to do it right...and the Royal Liverpool Philharmonic is certainly up to it...and the link to the youtube.com video is here. Parts of this are played a little faster than I'm used to...but it still rocks!
Well, dear reader, it certainly came as no surprise to me that JPMorgan et al. used the jobs numbers to bash the precious metal prices once again...something I alluded to in my column on Wednesday. They pulled that stunt on the June job numbers as well.
In the process of that engineered price decline yesterday, neither gold nor silver set new lows for this move down, so it's doubtful if "da boyz" improved their short positions by much. However, many of the new longs that came into the market during the last week certainly got stopped out...and that may have been all they were after.
I'm still of the opinion that we're going to see a re-pricing of all four precious metals at some point...and a time when few traders will be able to profit from it. I was kind of expecting it over the last couple of days, but it obviously never materialized.
All this bullish talk about gold coming from JPMorgan Chase...and now Dennis Gartman a couple of days ago, is a sign that the stage is set for a rally...probably a big rally...in gold and silver. And as I've said countless times...only the timing remains unknown to us, but not to the powers that be, as nothing happens by accident in the markets anymore.
So we wait.
Before I head off to bed, here's Nick Laird's "Total PMs Pool" chart that I post in this space every week. As you can see, there haven't been a lot of changes for the last few weeks.
That's it for the day...and the week...and I'll see you here on Tuesday.
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