We caught up with Joseph A. Klein today. While Putin is busy taking over the Crimean Peninsula Obama skips a national security briefing and then is out golfing in Florida. Joe Klein says it’s more of what we’ve come to expect from the current occupant of the White House. Russia has held these ports in the Ukraine for more than 300 years. Shouldn’t the US have seen this coming?
We caught up Mark Skousen, founder of the Libertarian hoedown Freedomfest, and well known writer and Libertarian commentator. This year’s Freedomfest promises to be better than all the rest. It will be held at Planet Hollywood in Las Vegas. The theme will be Is Big Brother Watching You? P.J. O’Rourke, an FSN favorite, will be appearing for the first time. Try to attend if you can make it.
Trace Mayer got in on the ground floor of bitcoin. Don Harrold has been talking about money and investing for more years than he cares to remember. Trace thinks that bitcoin is the currency of the future. Don is skeptical and believes there are privacy and safety issues that many members of the public need to be made aware of. Both men are extremely intelligent and worldly. Their hour long debate/discussion is quite compelling and discusses a number of issues that you need to hear.
Sandy Botkin the Tax Avoidance expert was back with us detailing a dozen scams that the IRS is warning taxpayers about. Some of them were downright ingenious. No wonder millions are falling prey to them. But we deconstruct them and give you practical advice that will help you avoid the scammers. Sandy’s got some tips you won’t find anywhere else.
High-speed telecommunications provider Perseus Telecom and digital currency trading platform Atlas ATS formally launched Wednesday a globally integrated bitcoin exchange system in New York, Hong Kong and Singapore to facilitate trading in the digital currency by high-frequency trading firms and other large financial institutions.
The two firms’ collaboration, first reported last month by The Wall Street Journal, marks a milestone in the evolution of bitcoin out of a retail-oriented, loosely regulated low-tech environment to one that is open to the high-volume and strictly regulated activities of Wall Street.
For example, the increasing signs of stress in the global financial system, from periphery currencies crashing to China’s shadow banking bailouts to the constant flow of official assurances that all is well and whatever situations aren’t well are on the mend.
The long lists of visible stress in the global financial system and the almost laughably hollow assurances that there are no bubbles, everything is under control, etc. etc. etc. certainly remind me of the late-2007-early 2008 period when the subprime mortgage meltdown was already visible and officialdom from Federal Reserve chairman Alan Greenspan on down were mounting the bully pulpit at every opportunity to declare that there was no bubble in housing and the system was easily able to handle little things like defaulting mortgages.
“In some cases the NSA has masqueraded as a fake Facebook server, using the social media site as a launching pad to infect a target’s computer and exfiltrate files from a hard drive. In others, it has sent out spam emails laced with the malware, which can be tailored to covertly record audio from a computer’s microphone and take snapshots with its webcam. The hacking systems have also enabled the NSA to launch cyberattacks by corrupting and disrupting file downloads or denying access to websites.
The man-in-the-middle tactic can be used, for instance, to covertly change the content of a message as it is being sent between two people, without either knowing that any change has been made by a third party.”
Things are starting to get very interesting, as the inevitability of TPTB losing control – a la 2008, or worse – appears more imminent than ever. On a daily basis, there are simply too many fires burning – economic, political and social – in too many places, for the “game” to last much longer; i.e., controlling mass perceptions via money printing, propaganda spreading and market manipulation. Regarding the latter, we have long discussed how gold and silver price suppression has been the most important enabler of such “can kicking”; and now that such manipulation is going mainstream, the odds of a London Gold Pool-like implosion of history’s most oppressive suppression scheme are increasing exponentially.
Between AUDJPY and and VIX slamming, the S&P 500 is pushing back up towards green. However, a glance at gold prices (at six-month highs $1365), Treasuries (retraced all of Friday’s non-farm-payrolls losses), and Swiss 2Y rates shows a safe-haven bid is alive and well. Yuan offshore rates are modestly strengthening and copper prices are bouncing as hopes remain that the unwind of the multi-trillion-dollar inflation of the Chinese shadow-banking system has run its course and all is well again. Perhaps the algos are confused once again that Europe does not close for another hour.
On the heels of another surge in gold and silver, today top Citi analyst Tom Fitzpatrick sent King World News an incredibly important chart which shows that gold may now be setting up to crush the shorts with a major upside advance. Below is the key gold chart that all KWN readers around the world need to see.
Here is what Fitzpatrick had to say: Gold: “Gold continues to outperform as it makes a higher high for the trend. A close above $1,362 would lend further support to the bullish trend and price action….
The narrative reads like a political soap opera. But, arguably, it is more likely to create the next global crisis than any other flash point. And American fingerprints are all over the crime scene.
In Japan, the five small and uninhabited islands in the East China Sea are called Senkaku. In China, or the People’s Republic of China, they are called the Diaoyu Islands. In Taiwan, or the Republic of China, they are the Tiaoyutai Islands. All three governments lay claim to the bitterly disputed patches of rock. Why? One reason is because they are key to controlling important shipping lanes, lucrative fishing areas and potential oil deposits. But historical and political motives join with economic ones to make the tiny islands explosive.
Indeed, it seems to draw closer to exploding each day, especially the situation between Japan and Mainland China. That’s because the islands are currently owned by Japan but deeply coveted by China. On March 8th, a New York Times headline declared, “China’s Hard Line: ‘No Room for Compromise’.” A March 9th headline in the China Times stated, “DF-21D missile could sink US aircraft carrier.” The article continued, “The report, written by various experts in India, concluded that the existence of the DF-21D has shaken the traditional view of the US Navy’s unassailable superiority in the Asia Pacific region.” On the same day, a Reuters’ headline reported, “Japan, US differ on China in talks on ‘grey zone’ military threats.”
After two days of hectoring the U.S. State Department by telephone and e-mail, and doing so as a newspaper editor, your secretary/treasurer today recruited his U.S. representative’s office to try to extract from State an answer to the question of whether the U.S. government has taken custody of Ukraine’s gold reserves, as suggested by news reports like the one cited here:
In 2014; we now see the next chapter in the economic nightmare known as “globalization” unfolding before us. Regular readers will be familiar with the first chapter of globalization.
Western governments were told (by their Corporate masters) to erase all of their borders, but only for the benefit of the large corporations which are the “fronts” for Western Oligarchs. This allowed the Oligarchs to shut-down most of their high-wage factories in the Western world, and shift their operations to wherever they could find the cheapest slave-labour – and the most-compliant governments.
Indeed, in 2014 these Oligarchs are now so smug and confident of the success of their agenda that they have the audacity to divulge it publicly:
The European Central Bank has given investors new guidance on interest rates going forward. In the past week, the ECB President Mario Draghi stated that outgap was the primary reason as to why the 18-nation euro area would need low rates even after growth and inflation pickup. Many of the board members of the ECB are backing this up, as they are certain that many monetary challenges await the euro in the near future.
The ECB has learned from its previous incidents of raising borrowing cost to early. Draghi is trying to assure investors that he’ll avoid the mistake of his predecessor, Jean-Claude Trichet, who raised borrowing cost in 2011 and in turn heightened a sovereign debt crisis. The road ahead for the Eurozone is a tricky one, as many economists believe that at this point, the Euro could benefit from some tighter policy. While the ECB and Mr. Draghi believe that the rates still need to be low.
At the onset of the derivatives collapse in 2007/2008 it would have been easy to assume that most of America was receiving a valuable education in normalcy bias.
In 2006, the amount of ego on display surrounding mortgage investment was so disturbingly grotesque anyone with any true understanding of the situation felt like projectile vomiting. To watch the smug righteousness of MSNBC and FOX economic pundits as they predicted the infinite rise of American property markets despite all evidence to the contrary was truly mind blowing. When the whole system imploded, it was difficult to know whether one should laugh, or cry.
The saddest aspect of the credit crisis of 2008 was not the massive chain reaction of bankruptcies or the threat of institutional insolvency. Rather, it was the delusional assumptions of the public that the grand mortgage casino was going to go on forever.
We had a global financial crisis in 2008 that was widely acknowledged to be the result of an unmitigated credit bubble egged on by loose central bank policy after the peak of the tech mania in 2000. Of course, central banks themselves did not acknowledge their responsibility. According to Ben Bernanke, it wasn’t the suppression of administered interest rates that set off the credit bubble that collapsed so spectacularly in 2008. Instead it was a ‘lack of regulation’. Right. We wonder if Mr. Bernanke would be interested in acquiring a certain bridge in Brooklyn?
So what did our vaunted policy makers decide to do to battle the effects of the expired credit bubble? Simple, they did what they always do: they replaced it with an even bigger one. How much bigger has recently been revealed by the quarterly BIS review.
Martin E. Dempsey (b; March 14, 1952) is the 18th Chairman of the Joint Chiefs of Staff. He has come out and stated that while he has been in communication with his military counterparts in Russia, he is also making it very clear that the U.S. military will respond militarily if necessary. He has gone on record stating “We do have treaty obligations with our NATO allies. And I have assured them that if that treaty obligation is triggered [in Europe], we would respond.”
Generally, even Washington is unaware as to why the 2nd Amendment was all about the right to retain arms. People protest and say guns should be outlawed, but the reasoning behind this thinking was to PREVENT war.
Good day. Right about now Chuck is sitting at the airport here in St. Louis waiting to board a plane which will take him to what he considers ‘heaven on earth’ – Cardinal Spring Training. As you all can tell from his build up, Chuck has been looking forward to this day for quite a while and now he is off to enjoy the warm weather and daily trips to the ballpark. And he is leaving just in time as our flirt with spring here in St. Louis has come to an abrupt end. Temps above 80 degrees yesterday have given way to freezing temperatures and wet snowflakes as I drove in this morning; talk about a see saw! As Chuck told all of you, Mike and I will be splitting up the writing responsibilities through the end of the month as it takes two of us to fill the big shoes of Chuck!
MUMBAI (MINEWEB) – Indian jewellers and retailers observed a nationwide strike on Monday protesting against the many restrictions imposed by the Indian government on inbound shipments of gold that have hammered gold and silver imports with a 71.4% slump recorded in February to $1.63 billion,.
In a call given by the Bombay Bullion Association and the India Bullion and Jewellers Association, around 90% traders in Maharashtra, Gujarat and certain pockets of South India, joined the one day strike on March 10.
“Our call for a strike was to protest against the government policies. It was hugely successful, as bullion traders in Mumbai, Gujarat and even Kolkata observed a shut down,” said Association president Mohit Kamboj.
With diplomacy having failed miserably to resolve the Russian annexation of Crimea, and soon East Ukraine (and with John Kerry in charge of it, was there ever any doubt), the US is moving to the heavy artillery. First, moments ago, the US DOE announced in a shocking announcement that it would proceed with the first draw down and sale of crude from the US strategic petroleum reserve, the first since June 2011, in what it said was a “test sale to check the operational capabilities of system infrastructure”, but is really just a shot across the bow at Putin for whom high commodity prices are orders of magnitude more important than how the Russian stock market performs. And now, as Bloomberg just reported, the US has escalated even further, citing the Chairman of the Joint Chiefs of Staff, General Martin Dempsey, who “has claimed that in the case of an escalation of unrest in Crimea, the U.S. Army is ready to back up Ukraine and its allies in Europe with military actions.“
Gold price resistance at $1361 per ounce, identified by chart-watching technical analysts from gold’s October 2013 high, was broken Wednesday lunchtime in London, as world stock markets fell and industrial commodities sank, led by a 5% drop in copper in China.
Spiking to 6-month highs for Dollar investors at $1366, the gold price outpaced a rise in the Euro to hit new 4-month highs against the single currency.
UK investors buying gold today also saw the price hit its highest level since early November at £822 per ounce.
The gold price in Shanghai rose overnight, but widened its discount to London by $2 per ounce, ending the day $4.30 cheaper as the Chinese Yuan fell back towards last week’s 6-month lows vs. the Dollar.
As some of you might remember, I requested last year that readers send in photos of flowers, sunsets, landscapes or anything else beautiful that my wife Kathy could use as a subject to paint. I thank everyone who did send photos because we received over 300 of them and they were much appreciated.
Last year she had just started painting with pastels and had an entry which was accepted and “hung” in the Austin Pastel Society’s 2013 juried competition. This was quite an honor as she had never painted before, never even liked art classes as a kid and had only been painting for 3 months. She has been a thrill to watch progress and yes, I am her biggest fan.
I have been adamant in stating that without Western-based investment demand for gold, the market cannot mount any sustained rallies. Asian gold buying provides the solid floor of support underneath the gold market but in and of itself, CANNOT maintain gold in a sharp bullish trend move higher. That requires concerted effort by the big Western specs.
My friend John Brimelow’s reports on Asian gold demand and premiums/discounts are the best source for gauging demand for the physical metal from that corner of the world but as a gauge of Western demand, I rely on the large gold ETF, GLD in particular. It is the best bellwether we have to determine whether or not we have some determined buying from this crowd.
Just when you think you’ve seen it all, yet another market-rigging scandal comes along to engulf some of the world’s biggest banks. This time it’s the foreign exchange markets, which were previously thought to be “too big to manipulate” since they involve $5.3 trillion a day in trades.
[...] Well, it turns out they can be manipulated after all, and now even the Bank of England is being implicated in the widening scandal. The BoE’s Joint Standing Committee on Foreign Exchange noted in the minutes of a July 2006 meeting that they had discussed “evidence of attempts to move the market around popular fixing times,” but evidently satisfied themselves that this was being done “by players that had no particular interest in that fix.” The topic was again raised at meeting in 2008 and 2012 before the story broke into the media in 2013.
The average person working in the securities industry earned a cool $164,530 bonus last year — 15% more than a year before.
An aggregate $26.7 billion was paid out in 2013 bonuses to the industry’s 165,200 employees, the highest figure since the 2008 financial crisis, according to figures released Wednesday by New York State Comptroller Thomas P. DiNapoli.
To put that bonus-pool figure in perspective, it would be enough to more than double the pay of the more than 1 million full-time workers earning the federal minimum wage, which is currently $7.25 per hour, according to the Institute for Policy Studies.
The bonus increase on Wall Street is a result of firms engaging in deferred compensation, according to the comptroller’s report. Financial firms are now paying out a smaller share of bonuses immediately and are instead deferring a larger share into future years.
Briefly: In our opinion short speculative positions (half) in silver and mining stocks are justified from the risk/reward perspective.
There were basically no changes in gold, silver and mining stock charts yesterday, except for gold moving slightly higher on news about increased tensions in Ukraine. Gold’s reaction was once again weak.
As a reminder, here’s what we wrote on March 3:
Given greater uncertainty and increased geo-political tensions we expect gold to outperform the rest of the precious metals sector in the near future. Technically, as you will see in the following part of today’s alert, the situation deteriorated. Therefore, if the tensions ease, the move lower could be simply bigger – markets would give away the tension-based rally and then move lower just as if this weekend’s events didn’t happen.
“Newsweek stands strongly behind Ms. Goodman and her article. Ms. Goodman’s reporting was motivated by a search for the truth surrounding a major business story, absent any other agenda. The facts as reported point toward Mr. Nakamoto’s role in the founding of Bitcoin.”
We discussed in yesterday’s podcast that today was likely to be a “Happy Tuesday”. And so it is. But that’s not important. What happens next is what matters most.
The absence of London Monkeys overnight allowed price to rally all the way into the Comex open this morning. As expected, though, price was immediately capped and thrown back from above $1350.
[...] This is nothing new and we’ve seen it all before. As discussed yesterday, anyone trading and willing to be out overnight or for a few days should consider taking profits above $1350 as it’s quite clear that The Cartel Banks DO NOT want to see gold trade clearly through there and, even more importantly, $1360. WHY? Because both levels are extremely important from a technical standpoint.
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