Sunday, June 30, 2013

Bonds Getting Slaughtered, Interest Rates to Rise Dramatically, Economic Bubbles to Implode

"What does it look like when a 30 year bull market ends abruptly? What happens when bond yields start doing things that they haven’t done in 50 years? If your answer to those questions involves the word “slaughter”, you are probably on the right track. Right now, bonds are being absolutely slaughtered, and this is only just the beginning. So why should the average American care about this?..."


This is the first time in history where you’ve had all the central banks in the world printing money at the same time

"Jim Rogers : “This is the first time in history where you’ve had all the central banks in the world printing money at the same time. Europe, Japan, America, and the UK, all, are frantically trying to debase their currencies…I’m afraid that in the end, we’re all going to suffer perhaps, worse then we ever have, with inflation, currency turmoil, and higher interest rates. As I say, this has never happened before, it’s never been a good policy in the long run, so I’m afraid we’re all going to suffer for the rest of this decade from this crazy, crazy money printing.” - in Zerohedge"


Maguire - Massive 580 Tons Of Gold Purchased In Just 7 Days

"Today whistleblower Andrew Maguire told King World News that Eastern Central banks have purchased a staggering 580 tons of physical gold in just the last 7 trading days.  This means Eastern Central banks just purchased a stunning 25% of the world’s annual gold mine production in just 7 trading days. This was the largest purchase of physical gold during any 7 trading day span in history.  Maguire, who recently appeared in the CBC production “The Secret World of Gold,” also discussed the brutal takedown in the gold and silver markets as well as the disappearing inventories in part one of a series of written interviews that will be released today.
Maguire:  “The lower these prices are set in the paper (gold and silver) markets, the stronger the physical buying becomes.  But it’s totally unsustainable.  And given the incredibly bullish COMEX structure now, and the global market underpinning, these paper sales just cannot continue any longer.
Officials have not been selling any physical gold for many months now....
“However, by manipulating the gold price lower through the foreign exchange interventions, they’ve succeeded in forcing 600 tons of ETF redemptions, COMEX capitulation, and drawn in an unprecedented level of fresh managed money short supply.  This has now successfully allowed the bailout of the bullion banks to the point where they have been able to get net long (gold) futures.  The two primary bullion banks that we all know about are net long.
But from a cash forex trading (currency trading) point of view, we are definitely still seeing aggressive official intervention, including the post-Bernanke smash (in the metals).  Any time he speaks we get the same thing.  The problem is this cash market intervention is also causing precious (metals) bullion inventories to deplete at a much faster rate than if gold was priced at $1,900.
Now I have contacts very close to the centers of influence in China, and I’m absolutely certain there is an escalation of this rapid exchange of dollars and euros for gold.  These spot indexed long gold/short dollar transactions (by the Chinese) are (ultimately) closed by seeking and taking physical allocations of (gold).
This is a huge deal, and it crystalizes the paper shuffle into real bullion.  That is (gold) bullion which is leveraged and underpinned by just a fraction of its face value (because of the LBMA paper Ponzi scheme).”


Maguire - LBMA Gold Flight Now Threatens Financial System

"Today whistleblower Andrew Maguire warned King World News that the massive flight of gold out of the LBMA “has now become a major threat to the Western central banking system.”  Maguire, who recently appeared in the CBC production “The Secret World of Gold,” takes KWN readers around the world on a trip down the rabbit hole once again in part two of a series of extraordinary written interviews that will be released today.
Maguire:  “The question that keeps coming up to me is how long can this paper market selling continue?  How can it continue to drive price when at the same time we are actually seeing such a massive transfer of physical underway into the Eastern trading blocs?
This recent heavily margined forced capitulation was absolutely Fed-induced.  And the only short-term goal of this was bailing out the defaulting bullion banks.  If you remember, we talked about this back in April after ABN AMRO exposed the whole LBMA system to a probable default.  This was a (major) crack in the system....
“The result of this official intervention:  There’s a tradeoff involved here because it’s tipped the balance and irreversibly broken the relationship between the paper markets and the global physical markets now.
The majority of all traded volumes are actually paper gold in the far less transparent over-the-counter foreign exchange markets.  People believe it (the manipulation) is all happening on the COMEX, but it’s not.  This (over-the-counter trading) is actually much more of a tool for the Fed and the Bank for International Settlements (BIS) than directly intervening in the COMEX.
You have to understand that gold/currency crosses are the primary focus of these official interventions that we see daily.  In other words, unlike all other commodities, gold and silver are first and foremost a heavily central bank manipulated (market), and are traded as a foreign exchange cross.
Now, Eric, here’s the rub.  This has created a huge problem for the central banks.  As a tradeoff in supporting the dollar it forces the shorting of gold, which then in turn leads to the Eastern central banks exercising the other side which is their long (gold) side.  And they convert that into real physical allocations at the daily precious metals fixes (in London).
In the past this (activity) was just a thorn in the Fed’s side.  The bullion could be borrowed or replaced at a later stage.  But the sheer volume of bullion being transferred out of the LBMA has now become a major threat to the Western central banking system.”


Thursday, June 27, 2013

Stand and Deliver: How Germany Disrupted the World's Gold Market

"Someone asked, 'why would there be a desire to do a stealth confiscation of gold from the public holdings in ETFs and private stores through price manipulation?' Who could have been assigned the task of prying bullion out of the hands of the people, and for what conceivable reason? It appears to be happening, but why?

There are any number of possible reasons. Concerns that an innovative new round of QE and money creation might create a run on the gold price is one possibility. There should be little doubt in those who look into the evidence that central bankers are quite sensitive to gold and silver as alternative currencies and reflections of their own policy initiatives.

And that is quite possible. As I have pointed out, there is some precedent for it. In 1933 Franklin Roosevelt pulled back much of the publicly held gold in the US. And after this was done, the government revalued the gold from $20 to $35 overnight, and then used the gains to recapitalize the banking system.

Although this could happen again, it does not seem likely because it flies in the face of everything the central bank has achieved by putting the US on a purely fiat money regime, the last gold ties being severed by Nixon in the 1970s. They prefer to denigrate gold, even though they still hold it, and certainly speak about it quite a bit often through their intermediaries.

There is definitely a movement to revisit the Bretton Woods Agreement that established the dollar as the world's reserve currency. The BRICs, whose economic power is ascendant, are seeking to establish a new currency for global trade that is owned by no single central bank or entangled in the domestic policies of no single country. And they wish to add gold and possibly silver to that mix. And they are in the process of acquiring substantial reserves to accomplish it.

The Anglo-American banking cartel is resisting this movement with all their diplomatic and political might. One of the sensitivities of the recent spying scandal leaks is the concern that they may be trying to obtain intelligence that could be used in these negotiations which are ongoing, very quietly behind the scenes.

But one has to ask, 'what set off the firestorm of price manipulation against gold that started at the beginning of this year?' Unless one is a shill, or naïve about markets, the market operation to knock the price of gold, and also silver, down is fairly obvious and heavy handed. They are not even trying to hide it. Traders do not dump hundreds or even thousands of contracts at market in quiet periods with any other objective than to take the price down. It really is that simple.

My initial take on this was that this was part of the 'price-setting' negotiation for gold and silver in the basket of currencies that the BRICs are developing. But that seemed a bit thin, unless it was seen as a 'last stand' against including gold and silver by making the argument that they were too volatile.

So I looked back on the chart for what I saw was the pivotal moment, and then checked the news and tried to find some event that may have served as the impetus for it. And the truth of it was staring me right in the face.

How remarkable is it that Germany, at the urging of their citizens and despite the objections of their central banks, has requested the return of its sovereign gold from its custodial storage in New York? And that the Feds said, no. You can't have it, but we will be in position to return your own property in seven years time.

What was up with that? Venezuela had recently requested its gold to be returned, and that helped to push the price of gold up to its all time high, because the request had obviously been floated before it became public knowledge.

So why couldn't Germany have the return of its own property for seven years?

Think about this. And perhaps what is happening now will become more clear. It is all a part of the credibility trap, wherein past actions of officials must be hidden in order to protect careers and ensure the orderly functioning of the status quo, even to its own eventual detriment.

Oh this is wrong? This is some weird theory? Well I admit that part of the problem is that we are left to guess what the central banks and the markets are doing with our money and property far in excess of what might be expected in democratic societies. This is the failure of regulation and oversight, and the corrupting power of big money in politics.

But, ok. If this is just some distraction, then give Germany back its gold, in full, this year.

If you wish to prove your word is good and facts are straight, give Germany back its gold.

And if you wish to restore some level of confidence in the markets, make them more transparent and open so people can conduct their business efficiently and safely without fear of being cheated and defrauded at every turn.

If you wish the trust and respect of the world, redeem what you have pledged to hold in trust.   If you have taken some actions in the past that were made in good faith and for good reasons, but may have gone too far or turned out badly in retrospect, make good on them now.   The way to stem a scandal is to bring the truth to light.  It is never the initial act that brings down government, but the subsequent attempt at coverup that obtains a life of its own.

Do the right thing even if it is not convenient, because it is the right thing to do. 

Prove your full faith and credit to be worthy.  Fulfill your oaths.  Tear down the wall of secrecy that divides the people from their government. End this before it can go any further.

Stand and deliver.

"Oh what a tangled web we weave when first we practice to device."

Sir Walter Scott

"We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake. Therefore at any price, at any cost, the central banks had to quell the gold price, manage it."

Sir Eddie George, Bank of England, in private conversation, September 1999


Marc Faber : Continue to Accumulate Physical Gold

""Technically, commodities look horrible…precious metals look bad. But tech factors would suggest we’re approaching at least an intermediate low. The commercials, which are essentially hedgers, people who produce gold and so continuously hedge, at the present time they have an extremely low short exposure, basically they’re accumulating gold.

“Whereas gold is close to $1,300 compared to say $700 in 2008, conditions in the mining industry are horrible. The exploration companies are running out of money and industry conditions are worse than they were in 2008. So I think that a lot of supply that potentially comes to the market through new exploration will simply not be there. In emerging economies sovereign funds, central banks and individuals will continue to accumulate physical gold." 
- in Market Watch"


Fed Continues Printing Money until it Implodes-Fabian Calvo

"Real estate expert Fabian Calvo says, “If Bernanke stops printing money, the housing market completely falls apart. . . . They’re just going to continue printing money until there is some sort of end-of-the-road event where this implodes.”  Calvo contends, “People all over the world, really at an unprecedented rate . . . are coming to the U.S and buying real estate because there’s a global rush for hard assets.”  Calvo says the bankers have really screwed up the property titles.  Calvo predicts, “There are going to be a lot of people fighting over the same piece of property, same as the gold market.  People are going to fight over that same bar of gold, claiming they own it.”  Calvo predicts the current real estate boom will go on for 6 to 24 months, but also says, “We’re going to have a real estate collapse that is centered around some sort of bond crisis or dollar crisis, and those will happen simultaneously.”  Join Greg Hunter as he goes One-on-One with Fabian Calvo from"


Jim Rogers : The Money Printing Bubble will burst and will cause a lot of pain across the Globe

"Jim Rogers : Most central banks have injected too much liquidity, which is not sustainable. (Fed chief Ben) Bernanke has said he is going to keep pumping in money and keep interest rates down until 2015. I don't know how it will last beyond this year.

But if Bernanke is determined to continue with it and other central banks in Japan and Europe will also follow suit, I feel it is the market that won't allow this to happen. I think the bubble will burst and will cause a lot of pain across the globe. It's not going to go on for a long time, and once it's over, it will be very painful for a lot of people. The bond prices will also go down despite the central banks' intervention. - in business-standard"


Physical Gold Market In Disconnect As Premiums Hit Record

"With gold and silver getting smashed, today John Hathaway told King World News that premiums for gold have now hit all-time record levels as the physical market has completely disconnected from the paper market in gold.  Hathaway also spoke about the gold and silver smash and provided an incredible chart as well.  Hathaway, of Tocqueville Asset Management L.P., is one of the most respected institutional minds in the world today regarding gold, and his fund was awarded a coveted 5-star rating. 
Eric King:  “John, we have this smash continuing in gold and silver, your thoughts here?” 
Hathaway:  “Right now it’s just piling on by momentum players.  Remember, it’s also the end of the quarter so this is window dressing in reverse.  People want to show big profits in short positions.
All along this has just been naked shorting by the usual suspects -- trading desks, the big banks, and hedge funds.  There is very little physical gold that’s being sold.  The mechanics (of shorting) are basically you post margin, and you short X amount of gold....
“Some of these (down) days you have seen volume that equals more than the annual mine production of the global (gold mining) industry.  That’s ridiculous to think that much gold could be acquired, positioned, and then shorted in such a short space of time..."

Monday, June 24, 2013

Leeb - There Is Outright Panic & Liquidation Now Taking Place

"On the heels of continued chaos in global markets, today acclaimed money manager Stephen Leeb told King World News there is outright panic and liquidation nowtaking place.  Leeb also told KWN the Chinese are going to get extremely aggressive in the physical gold market because they believe the price is way too cheap..."


Thursday, June 20, 2013

Stunning Volume On Gold & Silver Smash In Suspect Trading

"Today one of the savviest and well connected hedge fund managers in the world spoke with King World News about the smash in the gold and silver markets and what to expect going forward.  Outspoken Hong Kong hedge fund manager William Kaye also discussed the stunning volume in the gold and silver markets, as well as the suspect nature of the trading, and the propaganda coming out of the U.S. Federal Reserve.  Kaye, who 25 years ago worked for Goldman Sachs in mergers and acquisitions, had this to say in his tremendous interview.
Eric King:  “We are in the midst of a massive gold and silver plunge here, Bill.  What are your thoughts on the action we are seeing?”
Kaye:  “It’s the end game of a fantastic manipulation of the markets.  I’m looking at my screen now as we talk, Eric.  I’m in L.A. (Los Angeles), but we are still in Asian (trading) time with London just coming in at the moment, and we’ve traded over 94,000 contracts.
So passing the baton to London we will have already traded 100,000 contracts.  A normal night (during Asian trading) would be 20,000, to put that in perspective.  So the question is, who is selling all of these contracts at levels that are multi-year lows?  Who’s so keen to sell?....
“And if you need to sell, why are you selling at the worst time of day?  Why are you selling in Asian time, which is always the thinnest section of trading?  Why don’t you wait for London and Chicago to take over? 
And the answer is very obvious:  These markets are clearly and blatantly being manipulated.  The people doing it have clear price objectives.  My guess is they want to see a print below $1,300 (on gold) before they are done.  That will allow people (trading for the bullion banks) to make profits on their shorts.
The bullion banks, from the Commitment of Traders Reports that we’ve seen plus other information that we’ve gathered, strongly indicates that the banks, which are the  centerpiece of this conspiracy, have shifted rapidly from being on the edge of default, as ABN AMRO has already done, to being net long, and in some cases being very net long.
So they (bullion banks) have taken the opportunity that’s been provided by the cover from what would appear to be official intervention, in what I suspect is the Fed and possibly the ECB, to take the other side of that trade.  Now they are extremely net long and that sets the stage, in addition to a very promising technical picture, for a very powerful rally as we look at next week, into July and beyond.
The second half (of the year) could be extremely explosive on the upside for gold and silver as well.”



Wednesday, June 19, 2013

Bad loans continue to rise in Spain and Italy

"Spain and Italy reported today that the share of bad loans have continued to rise. There is nothing to suggest that this is the peak. In fact, further deterioration is likely.
Bad loans at Spanish banks rose to 10.87% in April from 10.47% in March and 8.73% in April 2012. These doubtful credits rose to 167.1 bln euros. Spain’s problem stems from the housing market boom. Prices have not bottomed..."


U.S. Mint Sales of Silver Coins Reach Record in 2013 First Half

"Sales of silver coins by the U.S. Mint have set a record high in the first half of 2013 seeing the best start to a year ever. Silver bullion coins were first offered in 1986.

Falling prices and concerns about being able to take delivery of coins amid continuing concerns about the US economy and currency debasement have led to the record demand.

Sales in 2013 have reached 24.03 million ounces and demand reached a monthly all-time high of 7.5 million ounces in January.

Demand remains at an “unprecedented level,” and sales of gold and silver coins may reach an annual record this year, Richard Peterson, the acting director of the mint, said on June 5.

Silver coin sales were suspended in January for more than a week because of a lack of silver inventory. In April, purchases more than doubled from a year earlier after prices tumbled 16% in two days due to unusually aggressive selling on the futures market.

Silver futures have declined 28% this year in New York, the biggest loss among the 24 commodities tracked by the Standard & Poor’s GSCI Spot Index but the smart money is continuing to accumulate on the dip.

The death of the gold and silver bull markets is greatly exaggerated as seen in the still very robust physical demand from investors and store of value buyers internationally including the U.S..."


Marc Faber Does Not Exclude GOLD Price Manipulation

"What has caused the price drop? Was it really a price manipulation by major U.S. banks?
Marc Faber
: One can not exclude, of course, that there has been a manipulation. If you see that the banks can manipulate the interest rate, then that is of course also possible with the gold market. But it also speaks something about it. There is in the world around 150,000 tonnes of gold. About 21 percent of that gold is in the hands of the Western central banks - at least officially. Finally, there is no fiduciary evidence that the gold is actually there. Central banks in emerging markets have virtually no gold in reserve. If the gold price is artificially depressed down, then favors the Asian central banks. You can then buy at lower prices. So in the interests of Western central banks should not have been such an action."


Physical Gold Cannot Possibly Lose Out Over Fiat & Digital Currencies – Here’s Why

"Gold cannot possibly lose its central position as the pre-eminent money used by the world for thousands of years. The aggressive measures of the Anglo-American Axis with regard to gold are absurd and they will lead to total disaster both for the Axis, and for the world which has been forced to follow its lead for over forty years..."


Jim Rogers : There will be a huge currency turmoil going forward and when that happens I rather be with the creditors rather than the debtor

"Jim Rogers : "There is no such thing as a sound currency. There will be a huge currency turmoil going forward and when that happens I rather be with the creditors rather than the debtors," in KUALA LUMPUR @ Invest Malaysia 2013 : 14 June 2013"


Tuesday, June 18, 2013

ANALYST: Now That The Cheap Money Is Coming To An End, We Can See The Bubble To End All Bubbles

"There's a Warren Buffett quote that's something akin to: When the tide goes out, you can see who's been swimming naked.
That's the theme of a note this morning from SocGen analyst Kit Juckes, who says that as rates are rising, and tapering talk picks up, it's beginning to be clear where the unsustainable bubbles have been built up.
No surprise: He says the bubbles were found in emerging markets, which have been crumbling lately..."


Didier Sornette: How we can Predict the Next Financial Crisis

"Good stuff here from Didier Sornette.  Sornette has done some superb risk on behavioral finance and risk management.  This recent Ted Talk is a must watch:

“While financial crashes, recessions, earthquakes and other extreme events appear chaotic, Didier Sornette’s research is focused on finding out whether they are, in fact, predictable. They may happen often as a surprise, he suggests, but they don’t come out of the blue: the most extreme risks (and gains) are what he calls “dragon kings” that almost always result from a visible drift toward a critical instability. In his hypothesis, this instability has measurable technical and/or socio-economical precursors. As he says: “Crises are not external shocks.”

An expert on complex systems, Sornette is the chair of entrepreneurial risk at the Swiss Federal Institute of Technology, and director of the Financial Crisis Observatory, a project to test the hypothesis that markets can be predictable, especially during bubbles. He’s the author of
Why Stock Markets Crash: Critical Events in Complex Financial Systems.


Biggest Bond Bubble In History Is Turning Into Carnage

"“We’ve intentionally blown the biggest government bond bubble in history,” confessed Andy Haldane, Executive Director of Financial Stability at the Bank of England, to Members of Parliament in London last week. The bursting of that bubble was a risk he felt “acutely,” he warned. There have already been “shades of that.” And he saw “a disorderly reversion in the yields of government bonds” as the “biggest risk to global financial stability.”

And “shades of that,” as Haldane put it with classic British humor, namely understatement, are visible everywhere.

Ten-year Treasury notes have been kicked down from their historic pedestal last July when some poor souls, blinded by the Fed’s halo of omnipotence and benevolence, bought them at a minuscule yield of 1.3%. For them, it’s been an ice-cold shower ever since. As Treasuries dropped, yields meandered upward in fits and starts. After a five-week jump from 1.88% in early May, they hit 2.29% on Tuesday last week – they’ve retreated to 2.19% since then. Now investors are wondering out loud what would happen if ten-year Treasury yields were to return to more normal levels of 4% or even 5%, dragging other long-term interest rates with them. They know what would happen: carnage!..."


Whenever Margin Debt Goes Over 2.25% Of GDP The Stock Market Always Crashes

"What do 1929, 2000 and 2007 all have in common?  Those were all years in which we saw a dramatic spike in margin debt.  In all three instances, investors became highly leveraged in order to "take advantage" of a soaring stock market.  But of course we all know what happened each time.  The spike in margin debt was rapidly followed by a horrifying stock market crash.  Well guess what?  It is happening again.  In April (the last month we have a number for), margin debt rose to an all-time high of more than 384 billion dollars.  The previous high was 381 billion dollars which occurred back in July 2007.  Margin debt is about 29 percent higher than it was a year ago, and the S&P 500 has risen by more than 20 percent since last fall.  The stock market just continues to rise even though the underlying economic fundamentals continue to get worse.  So should we be alarmed?  Is the stock market bubble going to burst at some point?  Well, if history is any indication we are in big trouble.  In the past, whenever margin debt has gone over 2.25% of GDP the stock market has crashed.  That certainly does not mean that the market is going to crash this week, but it is a major red flag..."


Richard Russell: The Great Gold Rip-Off, China, Russia & Silver

"With the two day Fed meeting beginning, the Godfather of newsletter writers, Richard Russell, writes about what he calls, “The Great Gold Rip-off.”  This is a fantastic piece where Russell also discussed the impact on the silver market, whether or not the US has all of the gold it claims, and what Russia and China are up to at this time.
Richard Russell:  “It looks like the great gold rip-off is completed and over.  A few of the banks (JPM) spread the rumor that gold was heading for $1,000 and that the bull market in gold was toast.  This set off a panic in gold and silver, which served the perpetrators well. 
As the metals swooned, the crooks, who had sold the metals short, made a tidy fortune as the metals collapsed.  At the same time, they loaded up on cheap gold and silver.  In all, quite a play, during which a good many duped investors dumped their silver and gold.
I understand that there is now a huge speculative short position in gold on the Comex.  This position will have to be covered.  This means driving the shorts out of the market.  Thus, the manipulators will have cleaned up -- first by selling the metals short, and then by loading up on the metals at the bottom of the panic in preparation for (hopefully) the ride up.
My guess is that China and Russia soaked up a good deal of the bargain-priced gold near the bottom of the panic. China waits patiently while the US spends its way into bankruptcy.  Which reminds me, there's still lots of talk about the true amount of gold owned by the US.  Then why the hell doesn't the government or the Fed finally audit our gold holdings and put an end to the rumors?  From what I understand, neither the Fed nor the US government want an audit.  If the gold is really there, then why don't they put an end to all the rumors?  For heaven's sake, let's have an audit -- or is there really something to hide?
I feel we are besieged with rumors, secrets, lies and manipulations..."

Monday, June 17, 2013

CANADA IS DOOMED: Three Signs That The Country Up North Is Screwed Beyond All Recognition

"You might be under the impression that everything is going pretty well in Canada, which had no banking collapse and only a mild recession in 2008-9.

You would be wrong.

The country is beset by political corruption scandals of the sort that people focus on when the economy is good. But it also has a massive ongoing housing bubble, and its economy is being propped up by a global commodities boom that now shows signs of slowing.
Let's break down the three ominous signs..."


Buy Chinese Yuan Jim Rogers Recommends

"The Chinese Yuan is an excellent long-term investment, potentially appreciating 500% and becoming the global reserve currency in the coming decades, legendary investor Jim Rogers told wealthdaily last week..."


Sunday, June 16, 2013

Russia Calls For IMF Overhaul

"The BRICs can call for whatever they wish, but until they find some way to apply more effective pressure on the Anglo-American banking cartel and their politicians, they are not going to get much of anything.

Their own people cannot get much of anything in the way of reform in the status quo. 

Russia’s Putin Calls for IMF Overhaul, Bigger Role for BRICS
MOSCOW, June 14 (RIA Novosti) – Russia will use its presidency of the G20 to push for a radical overhaul of the International Monetary Fund and changes to its voting system to give developing economies a stronger voice, President Vladimir Putin said Thursday in an interview with RIA Novosti.

“The IMF frequently fails to keep up with the rapidly changing situation in global finance – first and foremost, in making effective and timely decisions,” Putin said in answers to written questions, adding that the decisions’ “implementation leaves much to be desired as well.”

Russia currently holds the rotating presidency of the G20, a formal grouping of the world’s 20 most powerful economies, and will lead the G8, a group of the world’s eight richest countries, in 2014.

Putin did not call for the outright dissolution of the IMF, but argued that the organization must adjust to “current economic realities” and said it was time to consider the issue of its “overall reorganization.”

In particular, he said that the voting system used at the IMF to determine policy should be changed to “enhance the role of developing countries,” with new weight given to the so-called BRICS group of Brazil, Russia, India, China and South Africa...

Read the rest here."


Physical vs. Paper: The Shanghai Gold Exchange vs. the COMEX

"When push comes to shove, the COMEX is only pushing paper.

Weighed, and found wanting.

Shanghai Gold Exchange (SGE)

Weekly Gold Delivery From Shanghai Gold Exchange Vaults

Weekly Gold Delivery From Vault

The above graph of physical gold delivery out of the Shanghai Gold Exchange (SGE) vaults was prepared by @KoosJansen based on the weekly reports from the Chinese portion of the SGE site. The SGE has confirmed these are deliveries from the vault and the numbers are updated on a weekly basis (each Friday). I will publish the links to the exact Chinese pages next week and will ensure there is updated weekly delivery data available here.

Physical Delivery From Vault: SGE vs COMEX

Monthly Physical Delivery From Vault: SGE Versus COMEX

The above graph of monthly gold delivery from vault demonstrates very clearly what many have expressed repeatedly on sites such as KingWorldNews -- the COMEX is a paper gold market while the SGE is quite clearly a world class market for physical gold..."


Marc Faber : Derivatives are dangerous

"The danger is that the whole financial system could blow up due to the huge amount of derivatives still outstanding. Once again, excessive speculation is being fueled by artificially low interest rates, and asset bubbles exist everywhere..."


The Gold Story Is NOT Over. Far From It. Here’s Why

"Is it time to admit defeat, sell our positions, slink into a cave, and lick our wounds? Absolutely not. The only thing that changed over the past 60 days was the price of gold, and perhaps the mainstream’s perception of our industry. The realities of the fiscal and monetary state of the world, however, did not. Amid the ongoing rollercoaster ride of gold prices, clearheaded thinking reveals reasons to be optimistic..."


Nouriel Roubini : France, does not look much better than the Periphery

"Nouriel Roubini : The bond vigilantes may have woken up first in Greece, Ireland, and Portugal. "But France, does not look much better than the periphery." - in CNBC"


Stocks To Plunge As World Enters Massive Bank Panic

"Top Citi analyst Tom Fitzpatrick’s team sent King World News three extraordinary charts warning that a massive stock plunge and bank panic may stun bullish market participants and send shock waves through the global financial system.  KWN is pleased to share this warning with with our readers.  Below is what top Citi analyst Fitzpatrick’s team had to say along with three powerful charts. 
Fitzpatrick’s Team: 
“In the short-term we are now finally seeing some stress in the US equity markets (and more elsewhere).  Good levels are now being tested, which, if broken, would suggest further losses in the region of 10%+ (high to low).

We once again articulate the dynamics we would look for to suggest that a deeper correction (20%+) may be materializing...."



Expect Panic & Devastation As Control Of Markets Is Lost

"Today one of the top economists in the world warned King World News that investors should expect panic and devastation as central planners lose control of markets.  Michael Pento, founder of Pento Portfolio Strategies, also spoke about precious metals and unprecedented turmoil in global markets.
Pento: “The Fed has recently expressed a desire to begin winding down its quantitative easing program in the next few months.  This would be the first step towards the eventual raising of interest rates.  Mr. Bernanke and the other members of our central bank believe the normalization of interest rates would occur within the context of robust markets and rising GDP growth.
However, it seems the Fed has only succeeded in duping some perennial bulls (and possibly even trying to convince itself) into believing that ending QE and the subsequent increase in rates would not adversely affect the economy … but markets are not so easily fooled...."

Thursday, June 13, 2013

FELIX ZULAUF: Japan Will Cause The Next Big Global Crisis

"For weeks, Japan's stock market has been in an absolute freefall.

Last night the Nikkei fell to 12,445, down 6.4%. But it wasn't long ago that commentators were rejoicing in Abenomics – the policy moniker for Japan's monetary stimulus and government spending plan – for its bold three-pronged approach to juice the Japanese economy.
Now, with the Nikkei taking a turn for the worse and the yen strengthening, it appears Abenomics has not had the intended effect.
Felix Zulauf, swiss hedge fund manager and macro thinker, goes even further. He thinks Japan will spark a global crisis within the next 18 months.
Zulauf spoke with Financial Sense:
I do believe that this will be the root cause of the next big global crisis whenever it breaks out, probably sometime over the next 12 to 18 months or so. First of all, I think the Japanese situation is very dangerous because Japan’s tax revenues, when you look at the numbers, they have to use almost 50% to service their government debt—their Federal government debt. So if interest rates rise further, Japan is basically bust…I think this is a very dangerous thing that the Japanese are starting and I believe it will most likely be the trigger for the next big global crisis in financial markets and the world economy.
For years, the Bank of Japan has been a bastion of economic conservatism. Not anymore..."


Protectionism’s quiet return: The GTA’s pre-G8 summit report

"Commentators increasingly talk about the steady rise of protectionism. This column presents evidence from the newest Global Trade Alert report to suggest that they’re right: the past twelve months have seen a quiet, artful, wide-ranging assault on free trade. Little of this has showed up in traditional monitoring. Protectionism in Q4 2012 and Q1 2013 far exceeds anything seen since the onset of the global financial crisis..."


Euromoney Jumps On The BoomBustBandwagon: French banks most systemically risky in Europe

"Yesterday I opined extensively on transparency (actually, the lack thereof) in the European banking system - Transparency In The European Banking? Madness, I say! Sheet, Utter Madness!!! I tore into the Irish banks as well as reminding all of the 2011 research that found the French banks to be the weakest link in pan-European banking contagion. Of course, you'd never here that from the sell side. Well, as luck would have it, look what I found on today (Hat tip @StaceyHerbert)...

French banks most systemically risky in Europe – HEC Lausanne study:

According to systemic risk measures for European financial institutions, developed by the Centre for Risk Management at Lausanne (CRML), French regulators would need to provide €300 billion, as of mid-May, to fulfil regulatory requirements in the event of a global financial crisis, defined as a 40% semi-annualized fall in global stock markets.
Using methodology developed in collaboration with the well-known and influential New York University Stern’s Volatility Institute, run by NYU professor Leonard Stern and Nobel laureate Robert Engle, the index gauges large European banks’ systemic risk by measuring size, leverage and exposure to global equity market shocks. The dynamic index, updated on a monthly basis, reveals that, as of mid-May, Crédit Agricole has the greatest risk exposure of any bank in Europe, followed by Deutsche Bank and BNP Paribas.

Hmmm... Now, where have we heard this before?

French Banks Can Set Off Contagion That Will Make Central Bankers Long For The Good 'Ole Lehman Collapse Days!



Marc Faber : The danger is that the whole financial system could blow up due to the huge amount of derivatives still outstanding

"Marc Faber : The danger is that the whole financial system could blow up due to the huge amount of derivatives still outstanding. Once again, excessive speculation is being fueled by artificially low interest rates, and asset bubbles exist everywhere.- in Goldseek"


The Number That Matters

"Friday was one of those days when so many markets move so dramatically that it’s hard to know what to focus on. But in this case the headline numbers – US stocks way up, gold way down, foreign markets all over the place — matter less than the interest rate on 10-year Treasuries, which spiked:
10 year treasury june 13
The reason this number matters is that a return to “normal” times of high employment and fast growth also means a return to normal interest rates, which would be about twice current levels. This creates one or two little problems for a society with trillions of dollars of debt to roll over each year. Already, with the 10-year moving just from 1.7% to 2.2%, the junk bond market is suffering:
The Day The Big Fat Junk-Bond Bubble Blew Up
My friends in the corporate restructuring industry aren’t breaking out the bubbly just yet. But with one eye, they’re gazing wistfully into the distant horizon where they’re seeing the first signs of a glimmer of hope. And with the other eye, they’re gazing at the screens of their smartphones and computers where they’re seeing brutal junk bond rout..."


Jim Rogers : We Are In A Global Bond Bubble

"Jim Rogers : "Mr. Bernanke believes you can expand the central bank balance sheet infinitely, and suffer no ill effects. Anything you do to diminish demand for the thing will cause the price to drop. Same thing here. Bond prices will drop, which causes interest rates to rise. We are in a global bond bubble. When it pops is anyone’s guess. I have tried to short bonds a few times. The French tried money printing in the 50’s, the Italians in the ‘60s. At some point, the market won’t take it, and bond prices will go down and rates will rise. We have more money than Bernanke and the central banks do. So at some point this will happen." - in Fusion Marketsite"


Turk - A Massive Black Swan Is Going To Rock World Markets

"With Japan’s Nikkei plunging a massive 5.5%, today James Turk warned King World News that markets may be very close to witnessing another “black swan” that would create chaos once again in the global financial system.  Turk also spoke about the recent action in gold and silver and what investors should expect to see going forward.
Eric King:  “James, as you know a lot of times something will come and blind-side markets that nobody really has their eye on.  Do you have anything that might be a ‘black swan’ that nobody is focused on?”
Turk:  “We don’t hear too much about derivatives anymore.  That’s always a potential black swan hanging over the markets.  There is always the potential for geopolitical unrest, and we are seeing a lot of that again in the Middle-East, in various countries there.

I suppose the biggest ‘black swan,’ Eric, has to come from the banking system because that is the biggest threat to sound economic activity...."

Wednesday, June 12, 2013

ALBERT EDWARDS: 'One Of The Biggest Economic Bubbles Is About To Go Into The Minsky Masher'

"Australia's GDP growth expanded merely 0.6% in the first quarter. This was after a 0.6% rise in Q4 2012. Meanwhile, there are a lot of people shorting the Australian dollar.

Minus export growth however, Societe Generale's Albert Edwards writes that gross national expenditure (GNE) has fallen for two straight quarters.
"One of the biggest economic bubbles in history is now about to go into the Minsky masher," writes Edwards. This refers to periods of speculation that lead to crisis, and was named after economist Hyman Minsky who wrote about the inherent instability of bull markets..."


The Ultra-Easy Money Experiment

"The world’s central banks are engaged in one of the great policy experiments in modern history: ultra-easy money. And, as the experiment has continued, the risk of failure – and thus of the wrenching corrections and deep economic dislocations that would follow – has grown..."

Roubini On the proposed BRICS bank

"Nouriel Roubini : Well, BRICS sort of agreed to create the bank that could provide funding for productive investment to BRICS and other emerging markets. The details of that bank are still very fuzzy: Where will it be located? Who will provide most of the capital? Talks of the BRICS bank are a signal that emerging markets are somehow tired about global and financial institutions such as International Monetary Fund and World Bank where the executive boards are still controlled by advanced economies. They want to create a financial institution on which they have greater control. That in some sense is a negative signal because until now approach to financial stability has been driving global institutions, rather than the regional ones..."


Richard Russell - Gold, Stocks, Rigged Markets & The Wealthy

"Richard Russell:  “What to do?  I've never had such an overwhelming feeling that the cards are stacked against us, the retail or ‘non-professional’ investors.  The bond market is held up by the Fed.  The stock market is levitated by the Fed's QE.  The gold market is rigged by big banks and an assortment of manipulators.  The art and jewelry markets are owned by the world's billionaires.  Farm land is owned by the wealthy.  So again, what do we do?  Or what should we do?
One thing we can do is side with the Federal Reserve and get in the stock market with a position in the Diamonds (DIAs).  Or we can buy and hold physical gold, and hide it in a very secret place.  We can stay away from bonds and anything else that is extremely sensitive to interest rates.  Or last and surely the easiest on our nerves, we can sit on the sidelines with Federal Reserve notes (dollars) and some gold and await developments.  Incidentally, I understand that you can buy some heavy gold chains (you can call it jewelry), and this is one interesting and safe way of owning gold.
Lately, I have heard of several advisors who have given up and quit the business because they no longer trust the manipulated financial and market data.  Not surprisingly, stock market studies they have depended on for years no longer work in these manipulated markets..."

Tuesday, June 11, 2013

Marc Faber: Gold’s plunge is an Excellent Buying opportunity

"“I love the markets. I love the fact that gold is finally breaking down. That will offer an excellent buying opportunity”, said Faber in an interview with US financial news channel Bloomberg. “At the moment, a lot of people are knocking gold down. But the S&P is not even up 1% from the [pre-financial crash] peak in October 2007 [and] up 2% from March 2000 high.” - in moneyweek "


In America The Debt is going through the roof

"FM: In your book you call the US “The largest debtor in the history of the world”.

Jim Rogers
: That’s not an indictment, that’s a fact. If you consider it a negative fact, it’s an indictment. It happens to be a fact that it is the largest debtor nation in the history of the world. The debt is going through the roof, you know with all the shady rates. I do criticize it. I don’t like it. I’m an American citizen. I’m an American taxpayer, so I hate what’s happening with the debt situation in America. No nation in history has gotten itself into this situation and got out without a crisis. So I guess it is an indictment. - in Goldmoney"


The Ongoing War In Gold & A Coming Currency Collapse

"Today one of the savviest and well connected hedge fund managers in the world spoke with King World News about the ongoing war in the gold market and what to expect going forward.  Outspoken Hong Kong hedge fund manager William Kaye also warned there would be a currency collapse and discussed the bigger picture of what is actually taking place in the West and the East.  Kaye, who 25 years ago worked for Goldman Sachs in mergers and acquisitions, had this to say in this tremendous interview.
Kaye:  “The selling action on Friday was pretty well-foreshadowed.  Virtually every Non-Farm Payroll report, irrespective of the number, we’ve seen the same type of downside action.  The number, which is made up anyway, is always gamed.

There is clearly no evidence of a recovery, but as I said they gamed it anyway.  Once the physical market in London had been settled, the COMEX market was jammed lower and it has continued to be leaned on.  One thing that needs to be understood is that right now in Asia time we are dealing with something that is a little bit unusual...."

Stunning Gold & Silver Charts Reveal Shocking Global Demand

"June 11 (King World News) - Gold & Silver Charts Of The Day

Physical demand for gold & silver coins remains strong.  For the 3 months thru June, gold coin sales are 120k oz’s (46%) higher than for the 3 months leading up to the $1900 gold peak in 2011 (note: June sales are estimated).  Just looking at January-March data, gold coin sales are about 65k oz’s (23%) higher than the 3 months leading to 2011 peak.

Dollar amount of gold coin sales (3 month sum), is $100 million higher than the 2011 gold peak and, looking back, is at the highest level since June 2010.  If just looking at January-March data, sales are $80 million higher than the 3 months leading to the 2011 peak.

April data for China retail buying of gold, silver & jewelry show record sales.  Even if jewelry accounts for 40% of sales, that leaves $3 billion of gold & silver sales for the month...which is more than US Mint gold & silver coin sales for the past 12 months...."

Here Comes The Next Major Leg Of Gold Demand In China

"With continued volatility in key global markets, today acclaimed money manager Stephen Leeb spoke with King World News about important developments in the gold and silver markets.  Leeb also said the Chinese are setting up for the next major leg of gold demand in their country.  Below is what Leeb had to say in his interview.
Leeb:  “I think the biggest news longer-term for gold and silver investors is China’s recent approval of two ETF products.  This is yet another sign that China is very intent on accumulating as much gold as they possibly can.
You have to view this in conjunction with the fact that gold is down, but you also have to understand that when the market turns, the turn will be dramatic.  At the same time, I don’t think there is any downside in gold.  But what is very interesting to me, and typical of the Chinese, is that they waited until they knew there was very little downside in gold and silver to start their two ETF’s....
“Once they have satisfied their demand for gold the Chinese will come out and say, ‘We have a currency that is backed by gold.’  But the whole world is going to become more dependent on gold as a currency.  That’s the way it’s going to be.  This is the way things are unfolding right now.

After all of this money printing in the West, we are not getting any traction in the economy.  The Chinese are watching us and thinking, ‘The West needs a sensible policy.’  One of the sensible policies we will have to do with energy..."


Friday, June 7, 2013

John Mauldin: Japan Fired First Shots in Currency War [VIDEO]

"Japan has fired the first shots in a currency war that will have ramifications for economies across the globe, strategist and author John Mauldin said this morning on the MoneyBeat show..."


Fund Managers Are Now Buying Gold With Their Own Money

"With the dollar moving solidly lower and gold and silver rebounding, today acclaimed money manager Stephen Leeb told King World News that more and more fund managers are telling him they are buying physical gold with their own money, not GLD, and they are storing it themselves or in a vault outside of the banking system.  Below is what Leeb had to say in this powerful interview..."


Thursday, June 6, 2013

Does China Plan To Back The Yuan With Gold And Make It The Primary Global Reserve Currency?

"What in the world is China up to?  Why are the Chinese hoarding so much gold?  Does China plan to back the yuan with gold and turn it into a global reserve currency?  Could it be possible that China actually intends for the yuan to eventually replace the U.S. dollar as the primary reserve currency of the planet?  Most people in the western world assume that China just wants a "seat at the table" and is content to let the United States run the show.  But that isn't the case at all.  The truth is that China doesn't just want to compete with the United States.  Rather, China actually plans to replace the United States as the dominant economic power on the planet.  In fact, China already accounts for more global trade than the United States does.  So what would happen one day if China announced that it was backing the yuan with gold and that it would no longer be using the U.S. dollar in international trade?  It would cause a financial shift so cataclysmic that it is hard to even imagine.  Most of those that write about the "death of the U.S. dollar" usually fail to point out that China is holding a lot of the cards as far as the fate of the dollar is concerned.  China owns about a trillion dollars of our debt, China is the second largest economy on the planet, and nobody uses the dollar in international trade more than China does except for the United States.  Up until now, China has had to use the U.S. dollar in international trade because there has not been an attractive alternative.  But a gold-backed yuan would change all of that very rapidly..."


Fleckenstein - Gold Will Be Damn Explosive To The Upside

"Today Bill Fleckenstein spoke with King World News about the most exciting investing opportunity that he has ever seen in his career as he gave KWN his most powerful interview ever.  Fleckenstein also spoke about the “explosive” situation in the gold market.  Below is what Fleckenstein, who is President of Fleckenstein Capital, had to say in this extraordinary and exclusive interview.
Fleckenstein:  “Probably anyone who listens to your wonderful interviews already understands that money printing can’t solve anything ... Most recently the housing bubble led to the collapse in 2008/2009, and now we’ve got QE of biblical proportions being foisted upon us by the Fed, BOJ (Bank of Japan), Swiss National Bank, and probably the BOE (Bank of England) soon, etc.
The irony of it all is that 5 years into zero rates, and America alone (with) $5 or $6 trillion of deficit spending, the economy is still crummy.  No one ever says, ‘Why is that?’  Well, the reason is because money printing doesn’t work.”

Swiss Refiner Delays Hit 5 Weeks On Massive Gold Demand

"Today Egon von Greyerz told King World News that delays from Swiss gold refiners have expanded to a stunning 5 weeks.  KWN readers need to remember that the Swiss refiners refine over 75% of the world’s gold supply.  Greyerz also discussed what is happening with gold demand in other key markets.  Below is what Greyerz, who is founder of Matterhorn Asset Management out of Switzerland, had to say in this remarkable interview. 
Greyerz:  “Eric, the world has no idea what’s going to hit it.  The majority of people today in the West are living in debt and have no assets to protect, but for the people with savings and wealth and for the managers of funds, they don’t realize that they have lost 60% to 80% in real terms over the last 13 years.
Not only has cash in the bank gone down by 80% in real terms, which is against gold, but so have stocks, housing, commercial property, and many other assets.  So people live under the false illusion that paper money is a true measure of their wealth.  As we know, nothing is further from the truth...."