Stunning Interview From Market Legend On Gold, Oil & Stocks

"Eric King:  “Victor, we have seen a brutal 3-year cyclical bear market in gold, similar to to the cyclical bear phase we saw in the 1970s, but this is inside of what is a very long secular bull market.  What about the gold market?”

Sperandeo:  “As far as gold is concerned, we saw a rise in the price of gold for 12 straight years.  I don’t know many markets in the history of mankind that have winning streaks for 12 years in a row in one direction.  Gold has since declined from its high set in September of 2011.

We saw a decline in the price of gold of 28 percent in 2013.  And coming into Friday, gold was down another 2.7 percent this year.  So gold has declined roughly 31 percent in the past two years alone, but this was after 12-years of 15 - 16 percent annual compounded returns.  That’s a hell of a run that gold was on.

So as a big holder of gold myself and a big believer of gold fundamentally, I am not concerned at all.  I’m an investor in gold.  This is a rare thing for a trader but I have been an investor in gold for a long time.  I don’t believe that gold is going to go much lower, and the reason I say that is fundamental.

Right now we are at the breaking point for most gold mining companies.  This is a place where production costs are greater than than the current price.  Even Goldcorp recently reported a loss.  But when mining companies start to lose money, many of them will just choose to shut down production because they will be hemorrhaging cash in order to supply the additional gold to an already robust market in terms of physical demand.  Some will keep producing but they will slow production and let go of workers.  This is why you always get contango markets on low-priced commodities.  This happens because nobody wants to sell when prices are too low.  

Part of the reason we have seen additional weakness in gold is because of the recent dollar strength, but I am still a big bull on gold and fundamentally I believe the price is very near its lows.  So to answer your question, yes, we are still in a secular bull market in gold.  I just don’t see another down year for gold and commodities in general, especially after what the Bank of Japan just did.  Nobody has ever done the kind of Kamikaze money printing scheme the Japanese are doing.  This is just another fundamental pillar for gold in its secular bull market and will be extremely constructive for gold over the long-term.”

at http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/11/5_Stunning_Interview_From_Market_Legend_On_Gold,_Oil_%26_Stocks.html

As Gold & Silver Rout Continues, Physical Demand Is Stunning

"With crude oil tumbling over $2 a barrel and the gold and silver rout continuing, today James Turk spoke with King World News about the ongoing smash in gold and silver and what is happening in the physical market for both metals.  Below is what Turk had to say in this timely and powerful interview.

Turk:  “You and I have spoken many times, Eric, about how the central planners are fighting an all out war against the precious metals. Getting PayPal to close the account of the Swiss Gold Initiative in order to stop donations just goes to show how far they are willing to go....

“PayPal’s bending to the will of central planners is just one example of what everyone who owns physical gold and silver is up against. Nevertheless, this example of central planner intervention provides a strong reason why we must not lose sight of what Congressman Howard Buffett, the father of Warren Buffett, said in a brilliant speech in 1948: “In a free country the monetary unit rests upon a fixed foundation of gold or gold and silver independent of the ruling politicians.”

Regardless of whether we call those opposed to the precious metals as “ruling politicians” or “central planners,” it amounts to the same thing. When the government controls the currency and the institutions that circulate it - like PayPal - the government controls the economy and each and everyone one of us, which is a critically important point to recognize. If the central planners are willing to close this PayPal account, it is clear that they are pulling out all the stops in their war against the precious metals. They will do anything they can to perpetuate the fiat currency they issue.

In the final analysis, however, the central planners cannot change reality. This statement of course flies in the face of the anonymous aide to Bush the 2nd who in 2004 told Ron Suskind of the New York Times: “We're an empire now, and when we act, we create our own reality.” That exceedingly arrogant statement makes for good chutzpah by a central planner bellowing to a reporter about their own self-importance, but the central planners could not stop reality - let alone create the one they wanted - when in 2007 and early 2008 the financial system started unravelling around them. 

But that brings up the important point about whether gold is still a safe haven. The fundamental question we have to ask ourselves is whether gold’s 5,000 year history as money will end here? Just looking at it logically, it would be the height of folly to conclude that gold’s history ends here and that we can instead forever rely hereafter on government issued currency. Gold’s history did not end in 2008, and it won’t end here. The checkered history of government issued currency and the crises brought about when credit bubbles pop speak for themselves.

There are countless people in the world who understand that the attributes that made gold money pre-history have not disappeared. They've just been ignored or forgotten. For example, in the charts of crude oil prices in the blog we did last week, we can see that gold still provides two key functions of money. Gold is useful in economic calculation, in other words, for measuring prices. Also, gold preserves purchasing power.

An ounce of gold can still purchase the same amount of crude oil as it did a month ago or as the chart in last week’s blog shows, as it did in 1950. It is the dollar that is changing in today’s world of volatile currencies which fluctuate against each other, with each fluctuation resting upon the word uttered by some central planner. So the dollar is strong at the moment, but not because of some fundamental improvement. Rather, it is because the euro and yen are weak..."

at http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/11/3_As_Gold_%26_Silver_Rout_Continues,_Physical_Demand_Is_Stunning.html

The Man Who Got Britain Through The Recession Now Says We're 'Very Exposed' To A New Debt Crisis

"Business Insider: How exposed are we to another financial crisis? 

CEPR Geneva Report

Adair Turner: I think we’re still very exposed. Broadly speaking, what has happened since the crisis is that we have shifted leverage around the world but we haven’t gotten rid of it. This is the great conundrum to which we don’t yet have an answer.

In the UK and Spain and in Ireland and most dramatically in the US, there has been some deleveraging. But there has been a more than offsetting increase in public sector debt. So for every percentage point decrease in private sector debt as a percentage of GDP, there’s been a more than percentage point increase in public debt. Total leverage across the global economy has gone up.

We still don’t seem to know how to run our economies without credit growing somewhere faster than GDP, but that produces an eventual crisis..."

at http://www.businessinsider.com/adair-turner-talks-about-uk-household-debt-2014-10#ixzz3I2QHb3Lg

Saudi Arabia Raises Asia, Europe Prices; Cuts US Prices

"It appears, just as we warned two weeks ago, that the 'dumping strategy' designed to punish Obama's nemesis Putin could have morphed into a Saudi Arabian strategy to keep its foot on the neck of the US Shale Oil industry. In an awkward headline for mainstream media to explain, The Kingdom has raised prices of its Arab Light crude exports to Asia and Europe but cut prices to the USA significantly, potentially pressuring domestic suppliers with foreign 'cheap' imports. While not a primary course of US oil, we suspect the signaling of this move is more worrisome for Shale capex  (especially as we noted Saudi Arabia can survive 7.9 years at lower prices) Forget currency wars, meet oil wars...

One of these regions is an up-and-coming marginal oil-producer with the swing-barrel of production

As we warned previously,

So while we understand if Saudi Arabia is employing a dumping strategy to punish the Kremlin as per the "deal" with Obama's White House, very soon there will be a very vocal, very insolvent and very domestic shale community demanding answers from the Obama administration, as once again the "costs" meant to punish Russia end up crippling the only truly viable industry under the current presidency. As a reminder, the last time Obama threatened Russia with "costs", he sent Europe into a triple-dip recession. It would truly be the crowning achievement of Obama's career if, amazingly, he manages to bankrupt the US shale "miracle" next."

at  http://www.zerohedge.com/news/2014-11-03/saudi-arabia-raises-asia-europe-prices-cuts-us-prices

Yellen Shocked After Fisher Again Reveals Fed Is Source Of Record Inequality

"As Janet Yellen prepares to meet with President Obama this morning for the first time, it appears The Dallas Fed's Richard Fisher has planted a rather uncomfortable tape bomb for her to explain:

• FISHER: QE3 WAS A GIFT TO THE RICH

So right before the Midterm elections, a week after Janet Yellen discussed inequality, she is summoned to meet with The 'fair' President to explain how her policy is keeping Obama's dream alive?

*  *  *

Janet Yellen becomes aware of the inequality "problem"...

And maybe understands why...

*  *  *

To those that suggest QE was a victory, we have words and pictures...

If it was so successful, why did they stop?

and does this look like the chart of a successful monetary policy action?"

at http://www.zerohedge.com/news/2014-11-03/yellen-shocked-after-fisher-again-reveals-fed-source-record-inequality

Most People Cannot Even Imagine That An Economic Collapse Is Coming

"The idea that the United States is on the brink of a horrifying economic crash is absolutely inconceivable to most Americans.  After all, the economy has been relatively stable for quite a few years and the stock market continues to surge to new heights.  On Friday, the Dow and the S&P 500 both closed at brand new all-time record highs.  For the year, the S&P 500 is now up 9 percent and the Nasdaq is now up close to 11 percent.  And American consumers are getting ready to spend more than 600 billion dollars this Christmas season.  That is an amount of money that is larger than the entire economy of Sweden.  So how in the world can anyone be talking about economic collapse?  Yes, many will concede, we had a few bumps in the road back in 2008 but things have pretty much gotten back to normal since then.  Why be concerned about economic collapse when there is so much stability all around us?

Unfortunately, this brief period of stability that we have been enjoying is just an illusion.

The fundamental problems that caused the financial crisis of 2008 have not been fixed.  In fact, most of our long-term economic problems have gotten even worse.

But most Americans have such short attention spans these days.  In a world where we are accustomed to getting everything instantly, news cycles only last for 48 hours and 2008 might as well be an eternity ago.

In the United States today, our entire economic system is based on debt.

Without debt, very little economic activity happens.  We need mortgages to buy our homes, we need auto loans to buy our vehicles and we need our credit cards to do our shopping during the holiday season.

So where does all of that debt come from?

It comes from the banks.

In particular, the "too big to fail banks" are the heart of this debt-based system.

Do you have a mortgage, an auto loan or a credit card from one of these "too big to fail" institutions?  A very large percentage of the people that will read this article do.

And a lot of people might not like to hear this, but without those banks we essentially do not have an economy.

When Lehman Brothers collapsed in 2008, it almost resulted in the meltdown of our entire system.  The stock market collapsed and we experienced an absolutely wicked credit crunch.

Unfortunately, that was just a small preview of what is coming.

Even though a few prominent "experts" such as New York Times columnist Paul Krugman have declared that the "too big to fail" problem is "over", the truth is that it is now a bigger crisis than ever before.

Compared to five years ago, the four largest banks in the country are now almost 40 percent larger.  The following numbers come from a recent article in the Los Angeles Times...

Just before the financial crisis hit, Wells Fargo & Co. had $609 billion in assets. Now it has $1.4 trillion. Bank of America Corp. had $1.7 trillion in assets. That's up to $2.1 trillion.

And the assets of JPMorgan Chase & Co., the nation's biggest bank, have ballooned to $2.4 trillion from $1.8 trillion.

At the same time that those banks have been getting bigger, 1,400 smaller banks have completely disappeared from the banking industry.

That means that we are now more dependent on these gigantic banks than ever.

At this point, the five largest banks account for 42 percent of all loans in the United States, and the six largest banks account for 67 percent of all assets in our financial system.

If someone came along and zapped those banks out of existence, our economy would totally collapse overnight.

So the health of this handful of immensely powerful banking institutions is absolutely critical to our economy.

Unfortunately, these banks have become deeply addicted to gambling.

Have you ever known people that allowed their lives to be destroyed by addictions that they could never shake?

Well, that is what is happening to these banks.  They have transformed Wall Street into the largest casino in the history of the world.  Most of the time, their bets pay off and they make lots of money.

But as we saw back in 2008, when they miscalculate things can fall apart very rapidly..."

at http://theeconomiccollapseblog.com/archives/most-people-cannot-even-imagine-that-an-economic-collapse-is-coming

Worried About Gold / Silver Smash & Repression - Read This

"Today King World News is featuring a piece by a man whose recently released masterpiece has been praised around the world, and also recognized as some of the most unique work in the gold market.  Below is the latest exclusive KWN piece by Ronald-Peter Stoferle of Incrementum AG out of Liechtenstein.

In our last “In Gold we Trust” reports, we extensively discussed the topic of financial repression. Financial repression always consists of a combination of different measures, which lead to a significant narrowing of the universe of investable assets for investors. Money, which in a more liberal investment environment would have flowed into other asset classes, is channeled in a different direction. The goal of financial repression is an indirect reduction of government debt by means of the targeted manipulation of the cost of government debt, most of the time accompanied by steady inflation.Financial repression is ultimately a government-imposed transfer of wealth...."

at http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/11/1_Worried_About_Gold___Silver_Smash_%26_Repression_-_Read_This.html

Stunning Facts About China, Russia & End Of Gold Bear Market

"Today a legend who was recently asked by the Chinese government to give a speech to government officials in China spoke with King World News about the end of the gold bear market as well as stunning facts about China and Russia.  John Ing, who has been in the business for 43 years, also spoke about why available supply to the gold market is about to be substantially reduced.

Ing:  “It’s auspicious that it’s a trick-or-treat market. The trick is that the collapse in gold and silver, particularly gold -- having retested the $1,180 chart point three times, it violated it today. Second is that the S&P and Dow Jones are making new highs. All of this is coming after the Fed’s announcement that quantitative easing is over....

“And there is a terrific correlation between the S&P and quantitative easing, with the S&P being up roughly 40 percent as quantitative easing injected something like $4 trillion. So we know where that money went. At the same time, the GDP numbers came out and all this contributed to the strength in the U.S. dollar.

The ‘treat’ for gold investors is that physical buying remains very strong. Evidence coming out of China suggests that they have already bought somewhere around 1,500 tons of gold and they will probably buy at least another 200 tons before the end of the year. So they continue to buy at better than 100 tons each month. This evidence comes from the drawdowns on the Shanghai futures exchange, where in one week alone they withdrew 68 tons of gold. The Chinese have been buying the gold that we are selling in the West.  

The other big buyer of course has been Russia. Russia has been buying gold as a hedge against the dollar. We know that Russia has well over 1,000 tons of gold now. So when you add together China, Russia, and let’s not forget India, you have incredibly strong physical demand for gold.

But we also have gold stocks coming out with their earnings in this third quarter. And other than Barrick, we have seen that a lot of the gold companies' problems in the past are now coming home to roost. Barrick is trading at a 22-year low even after reporting profits. Yamana Gold had to take a billion-dollar writedown. Goldcorp is also having problems at a major project. B2Gold also disappointed. 

What this tells me is that at the current price of gold it’s very difficult for the gold miners to produce an ounce of gold. This will put a further crimp on supplies to the market when the market is experiencing incredibly robust physical demand. But we have never seen the mining stocks as technically cheap as they are today.

Finally, my portfolio manager out of Paris has done some very fine work looking at Comex gold dating back to 2011. He looked at the bullion short position and since June 2013 we had four peaks in terms of short interest. After each peak in the non-commercial short interest there has been a dramatic run-up in the price of gold as high as 40 percent on the turnaround.  

I believe we have peaked in the last week or so in terms of the non-commercial gold shorts. So I think we are within days of this turnaround in gold. The U.S. dollar is incredibly overbought and the technical evidence shows that gold is very oversold. This situation should reverse itself shortly and gold should begin a rather lengthy and large move to the upside. This also means the gold bear market is finally coming to an end.”

at http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/11/2_Stunning_Facts_About_China,_Russia_%26_End_Of_Gold_Bear_Market.html

Silver Is One Of The Greatest Opportunities In World History

"With a price that has been under so much pressure, this would normally suggest that silver demand has been weak and the market is being overwhelmed by supply, but that’s not the case.  The demand for silver coins from the U.S. Mint has risen dramatically and there has been continued demand from the industrial side, which takes up the lion’s share of supply.

People have to remember that in the aftermath of World War II there were massive inventories of silver in the world.  And following the Hunt Brothers attempt to corner the market in the 1970s, above ground inventories remained huge.  But all of these above ground inventories have been absorbed as physical demand has outstripped mine supply for many, many years.

Also, the majority of silver mine supply comes as a result of base metals mining.  With the world now moving inexorably toward a recession/depression, and with excess supply everywhere, the demand for base metals is going to decline sharply.  This will curtail production and mean there will be less silver byproduct.

So I see an extremely positive supply/demand situation building here at a price that is remarkably discounted for silver.  What doesn’t get discussed is the fact that not too long ago roughly 1/3 of the industrial demand for silver was related to photography.  But all of that demand from photography has disappeared and been replaced by solar demand, medicinal demand, etc..  And these new sources of demand continue to grow well beyond what we used to see from photography.

But because the paper manipulation is beyond remarkable, silver remains as undervalued an asset as I have ever seen.  As an example, in the last 135 trading days the silver price has declined in the thinly traded access market 130 times at the open.  So to be clear, in the early hours of the east coast of the United States silver has declined at the opening of trading 130 out of the last 135 trading days.  That is preposterous.  And some of these declines have been precipitous.

This is purely manipulation by high-frequency and algorithm programs and it sets the tone for each trading day and permits the powers that be to keep the pressure on the price.  This is all part of how they attempt to keep the public away from gold and silver.  But gold and silver are the only real money and it remains the arch enemy of the failing fiat currency system.  So the central bankers are in overdrive here trying to discredit gold and silver.

Sadly the Western governments and central banks have failed their citizens and are now trying one last time to keep things afloat.  Unfortunately they are going to fail, and all investors can do as that day of failure rapidly approaches is to own physical gold and silver in order to protect themselves.  This is the most dangerous time in world history, both economically and financially -- strictly on the leverage in the financial system -- and the sad truth is that I don’t even think we are going to recognize the world when this is over.”

at http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/11/3_Silver_Is_One_Of_The_Greatest_Opportunities_In_World_History.html

Maguire: This Triggered Today’s Massive Selloff In Gold & Silver

"Today London metals trader Andrew Maguire spoke with King World News about exactly what triggered today’s stunning and massive selloff in gold and silver.  Below is what Maguire had to say in Part II of an extraordinary series of interviews being released today on KWN.

Eric King:  “Andrew, we are seeing a continuation of the smash in gold and silver.  What are your thoughts here as you are watching this?”

Maguire:  “First thing this morning, after the Bank of Japan decision, things got a bit roiled.  But what I did see was a fully-timed algorithm kick off at exactly 7 AM U.K. time.  There is only one seller that can come up with 50 tons of paper gold in a matter of 3 or 4 minutes and that is the Bank for International Settlements....

“We saw this come through and it attacked the entire (massive) bid stack (defending the previous low of $1,180) in a matter of seconds.  Obviously there were visible stops.  They (the Bank for International Settlements) knew exactly what they were attacking there.  It was purely paper gold.  We are talking about 50 tons, Eric.  That’s an awful big position for somebody to put on (as) a risk position in a single shot.

People ask, ‘How do you know?’  We know that it has to be an official (entity).  It cannot possibly be somebody  with a compliance department with a risk position they have to look at.  And the other thing is this (trade) was enacted in the foreign exchange markets, as opposed to the Comex.

In other words, the short seller suddenly sold gold against the dollar in the foreign exchange market, and that had a huge effect and was able to trip off (an additional) 50 tons of Comex supply in a matter of minutes.” 

at http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/10/31_Maguire__This_Triggered_Todays_Massive_Selloff_In_Gold_%26_Silver.html

Maguire - We’re Seeing Stunning Amounts Of Euro Gold Buying

"Today London metals trader Andrew Maguire told King World News that there is currently stunning amounts of euro gold physical buying taking place in London.  Maguire also spoke about the staggering demand for physical gold elsewhere around the world.  Below is what Maguire had to say in Part I of a series of interviews.

Maguire:  “There is solid evidence of continued investment bar demand coming out of China, large Indian demand related to Diwali last week, and fully unreported, off-the-scale large euro gold buying that you don’t see reported anywhere.  But it’s absolutely evident in the wholesale markets...."

at http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/10/31_Maguire_-_Were_Seeing_Stunning_Amounts_Of_Euro_Gold_Buying.html

From This Day Forward, We Will Watch How The Stock Market Performs Without The Fed’s Monetary Heroin

"Mark this day on your calendars.  The Dow is at 16974, the S&P 500 is at 1982 and the NASDAQ is at 4549.  From this day forward, we will be looking to see how the stock market performs without the monetary heroin that the Federal Reserve has been providing to it.  Since November 2008, the Fed has created about 3.5 trillion dollars and pumped it into the financial system.  An excellent chart illustrating this in graphic format can be found right here.  Pretty much everyone agrees that this has been a tremendous boon for the financial markets.  As you will see below, even former Fed chairman Alan Greenspan says that quantitative easing was "a terrific success" as far as boosting stock prices.  But he also says that QE has not been very helpful to the real economy at all.  In essence, the entire quantitative easing program was a massive 3.5 trillion dollar gift to Wall Street.  If that sounds unfair to you, that is because it is unfair.

So why is the Federal Reserve finally ending quantitative easing?

Well, officially the Fed says that it is because there has been so much improvement in the labor market...

The Fed's language, however, did suggest that they were getting more comfortable with the economy's improvement. It cited "solid job gains," citing a "substantial improvement in the outlook for the labor market," as well as pointing out that "underutilization" of labor resources is "gradually diminishing."

But that is not true at all.

The percentage of Americans that are working right now is about the same as it was during the depths of the last recession.  Just check out this chart...

So there has been no "employment recovery" to speak of at all.

And as I wrote about yesterday, the percentage of Americans that are homeowners has been steadily falling throughout the quantitative easing era...

So let's put the lie that quantitative easing helped the "real economy" to rest.  It did no such thing.

Instead, what QE did do was massively inflate stock prices.

The following is an excerpt from a Wall Street Journal report about a speech that former Fed chairman Alan Greenspan made to the Council on Foreign Relations on Wednesday...

Mr. Greenspan’s comments to the Council on Foreign Relations came as Fed officials were meeting in Washington, D.C., and expected to announce within hours an end to the bond purchases.

He said the bond-buying program was ultimately a mixed bag. He said that the purchases of Treasury and mortgage-backed securities did help lift asset prices and lower borrowing costs. But it didn’t do much for the real economy.

“Effective demand is dead in the water” and the effort to boost it via bond buying “has not worked,” said Mr. Greenspan. Boosting asset prices, however, has been “a terrific success.”

Moving forward, what did Greenspan tell the members of the Council on Foreign Relations that they should do with their money?

This might surprise you...

Mr. Greenspan said gold is a good place to put money these days given its value as a currency outside of the policies conducted by governments.

Wow.

It almost sounds like Greenspan has been reading the Economic Collapse Blog..."

at http://theeconomiccollapseblog.com/archives/from-this-day-forward-we-will-watch-how-the-stock-market-performs-without-the-feds-monetary-heroin

Does This Look Like A Housing Recovery To You?

"We just learned that the homeownership rate in the United States has fallen to the lowest level in 19 years.  But of course this is not a new trend.  As you will see in this article, the homeownership rate in the United States has been in a continual decline for more than 7 years.  Obviously this is not a sign of a healthy economy.  Traditionally, homeownership has been one of the key indicators that you belong to the middle class.  When people define "the American Dream", it is usually one of the first things mentioned.  So if the percentage of Americans that own a home has been steadily going down for 7 years in a row, what does that tell us about the health of the middle class in this country?

The chart that you are about to view is clear evidence that we are in the midst of a long-term economic decline.  It shows what has happened to the homeownership rate in the U.S. since the year 2000, and as you can see it has been collapsing since the peak of the housing market back in 2007.  Does this look like a housing recovery to you?...

So many people get caught up in what is happening on Wall Street, but this is the "real economy" that affects people on a day to day basis..."

at http://theeconomiccollapseblog.com/archives/does-this-look-like-a-housing-recovery-to-you

The Dollar Decline Continues: China Starts Direct Convertibility With Asia's #1 Financial Hub

"Earlier this week some of the biggest financial news of the year made huge waves all over Asia.

Yet in the Western press, this hugely important information has barely even been mentioned.

_{While this is ignored in the US so far, it’s front page news in Asia}

So what’s the news?

The Chinese government announced that the renminbi will become directly convertible with the Singapore dollar... effective immediately..."

at http://www.zerohedge.com/news/2014-10-30/dollar-decline-continues-china-starts-direct-convertibility-asia-1-financial-hub

Shadow Banking Assets Increase By $5 Trillion To Record $75 Trillion, 120% Of Global GDP

"Call it Monitoring Universe of Non-Bank Financial Intermediation (MUNFI), Other Financial Intermediaries (OFI), non-bank financial intermediation or, easiest of all, by its widely accepted name, Shadow banking. Whatever you want to call it, the latest just released estimate by the Financial Stability Board of how many assets current exist outside of the regular banking system (and are thus in the shadows) around the globe should explain why these day the one thing central bankers are most worried about is the uncontrolled proliferation of shadow assets (technically it is liabilities, but that is a different discussion). The reason: according to the broadest measure of shadow banking, it grew by $5 trillion in 2013 to reach $75 trillion. This represents some 25% of total financial assets and when expressed in terms of global GDP, it amounts some 120% of global GDP.

We are not exactly sure which is scarier: that total financial assets amount to about 500% of world GDP or that about $75 trillion in financial leverage is just sitting there, completely unregulated and designed with one purpose in mind: to make billionaires into trillionaires (with taxpayers footing the bill of their failure)..."

at http://www.zerohedge.com/news/2014-10-30/shadow-banking-assets-increase-5-trillion-record-75-trillion-120-global-gdp

Alan Greenspan: QE Failed To Help The Economy, The Unwind Will Be Painful, "Buy Gold"

"It appears it is time for some Hillary-Clinton-esque backtracking and Liesman-esque translation of just what the former Federal Reserve Chief really meant. As The Wall Street Journal reports, the Fed chief from 1987 to 2006 says the Fed's bond-buying program fell short of its goals, and had a lot more to add.

Mr. Greenspan’s comments to the Council on Foreign Relations came as Fed officials were meeting in Washington, D.C., and expected to announce within hours an end to the bond purchases.

He said the bond-buying program was ultimately a mixed bag. He said that the purchases of Treasury and mortgage-backed securities did help lift asset prices and lower borrowing costs.But it didn’t do much for the real economy.

“Effective demand is dead in the water” and the effort to boost it via bond buying “has not worked,” said Mr. Greenspan. Boosting asset prices, however, has been “a terrific success.”

...

He observed that history shows central banks can only prick bubbles at great economic cost. “It’s only by bringing the economy down can you burst the bubble,” and that was a step he wasn't willing to take while helming the Fed, he said.

...

The question of when officials should begin raising interest rates is “one of those questions I cannot answer,” Mr. Greenspan said.

He also said, “I don’t think it’s possible” for the Fed to end its easy-money policies in a trouble-free manner....

"Recent episodes in which Fed officials hinted at a shift toward higher interest rates have unleashed significant volatility in markets, so there is no reason to suspect that the actual process of boosting rates would be any different, Mr. Greenspan said.

...

“I think that real pressure is going to occur not by the initiation by the Federal Reserve, but by the markets themselves,” Mr. Greenspan he said.

And finally - while CNBC's audience is told what a terrible thing gold is, "The Maestro", having personally created the financial cataclysm the world finds itself in following a lifetime of belief in fiat, Keynesian ideology and "fixing" one bubble with an even greater and more destructive asset bubble, has suddenly had an epiphany and now has a very different message from the one he preached during his decades as the head of the Fed.

Mr. Greenspan said gold is a good place to put money these days given its value as a currency outside of the policies conducted by governments.

What Greenspan failed to add is that it is thanks to his disastrous policies (subsequently adopted by Bernanke and Yellen) that gold is the "place to put money."

And now, paging Scott Nations."

at http://www.zerohedge.com/news/2014-10-29/alan-greenspan-qe-failed-help-economy-unwind-will-be-painful-buy-gold