Jul 24

This Has Never Happened To Gold Before (ZeroHedge, July 24, 2015):

For the first time since records began, hedge funds are net short gold futures, according to CFTC data…

20150724_Gold

This is what happened the last time gold saw a ‘low’ net long position…

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Is this why Gold is spiking this afternoon? Continue reading »

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Jul 24

GRouNDHoGS AND PoNZiS...

Fed “Accidentally” Released Dovish Confidential Market-Moving Forecasts, Blames “Glitch”  (ZeroHedge, July 24, 2015):

First The ‘unaudited’ Fed leaks its FOMC minutes. Then they leak ‘inside-information’ to Nikkei’s latest addition, Medley Global advisors (and remain “above the law” with regard consequences. And now, The Fed admits it leaked full blown confidential economic projections (due to a code glitch), whose summary assessment is shown below as per the leaked file.

groundhogs-and-ponzis2

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Jul 24

In Latest Market Rigging Scandal, Wall Street Now Sued For Treasury Market Manipulation (ZeroHedge, July 24, 2015):

“Defendants used electronic chatrooms, instant messaging, and other electronic and telephonic methods to exchange confidential customer information, coordinate trading strategies.”

“Traders at some of these primary dealers talked with counterparts at other banks via online chatrooms and swapped gossip.”

Sound familiar?

Those quotes are from a 61-page complaint filed in the Southern District of New York wherein Boston’s public sector pension fund accuses all US primary dealers (the cabal of usual suspect dealer banks that transact directly with Treasury and “have a special obligation to ensure the efficient function” of what was formerly the deepest, most liquid market on the planet) of colluding to manipulate the $12.5 trillion US Treasury market.  Continue reading »

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Jul 24

24-07-2015_3

Gold “Capitulation” As Down 8% In July – Smart Money Buying Dip (ZeroHedge, July 24, 2015)

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Jul 24

H/t reader M.G.:

“On another topic, here is an amazing lecture given to an Econ 101 on the destruction wrought by the debasement of currency with the use of paper money…..It was given in 2002, before the leveraging of our money 1000:1 and before the additional leveraging of the leveraged funds commenced in the last three years………………I wish the world could have heard this lecture…”


Free coinage

Econ 101 Lecture 3:

Description

Undefined

CREDIT UNIONS

– The Invisible Vacuum Cleaner –
– The Quantity Theory of Money –
– Destruction of the Gold Standard –
– And Discrediting the Real Bills Doctrine –
– Are Two Sides of the Same Coin –
– The Working Man As the Guardian of Sound Money –

Lending versus Clearing

I dedicate this lecture to the memory of Ely Moore, the first union official ever to have been elected to the Congress in 1834. He was a solid gold-standard man who believed, with Daniel Webster, that

“Of all the contrivances for cheating the laboring classes of mankind, none has been more effective than that which deludes them with paper money.”

Daniel Webster 

In the first two Lectures I dealt with a new blueprint for a gold coin standard for America and the world, designed to avoid two great pitfalls: (1) the pitfall of breakdown of social peace between creditors and debtors, (2) the pitfall of entrusting gold coins that represent the savings of the people to the banks. In this Lecture I shall recommend that the guardianship to preserve the system of sound money should, instead, be entrusted to the laboring classes and their representatives, the Credit Unions, which would be the only financial institutions chartered to carry deposit accounts denominated in Gold Eagle coins, and which would act as clearing houses for the circulation of real bills. Continue reading »

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Jul 24

World Trade Slumps By Most Since Financial Crisis (ZeroHedge, July 23, 2015):

As goes the world, so goes America (according to 30 years of historical data), and so when world trade volumes drop over 2% (the biggest drop since 2009) in the last six months to the weakest since June 2014, the “US recession imminent” canary in the coalmine is drawing her last breath

World Trade Volume

As Wolf Street’s Wolf Richter adds, this isn’t stagnation or sluggish growth. This is the steepest and longest decline in world trade since the Financial Crisis. Unless a miracle happened in June, and miracles are becoming exceedingly scarce in this sector, world trade will have experienced its first back-to-back quarterly contraction since 2009. Continue reading »

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Jul 24

Gold “Flash-Crashes” Again Amid Continued Commodity Liquidation As China Manufacturing Slumps To 15-Month Lows (ZeroHedge, July 23, 2015):

As Bridgewater talks back its now widely discussed bearish position on fallout from China’s equity market collapse, Chinese stocks rose at the open (before fading after ugly manufacturing data). However, liquidations continue across the commodity complex in copper, gold, and silver. Though not on the scale to Sunday night’s collapse, the China open brought another ‘flash-crash’ in precious metals. All signs point to CCFD unwinds, and forced liquidations as under the surface something smells rotten in China, which has just been confirmed by the lowest Manufacturing PMI print in 15 months.

Gold flash crashed…

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As we noted previously, while the actual selling reason was irrelevant, the target was clear: to breach the $1080 gold price which also happens to be the multi-decade channel support level. Continue reading »

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Jul 24

Screaming-Smiley

Copper, China And World Trade Are All Screaming That The Next Economic Crisis Is Here (Economic Collapse, July 23, 2015):

If you are looking for a “canary in a coal mine” type of warning for the entire global economy, you have a whole bunch to pick from right now.  “Dr. Copper” just hit a six year low, Morgan Stanley is warning that this could be the worst oil price crash in 45 years, the Chinese economy is suddenly stalling out, and world trade is falling at the fastest pace that we have seen since the last financial crisis.  In order not to see all of the signs that are pointing toward a global economic slowdown, you would have to be willingly blind.  In recent months, I have been writing article after article detailing how the exact same patterns that happened just before the stock market crash of 2008 are playing out once again.  We are watching a slow-motion train wreck unfold right before our eyes, and things are only going to get worse from here. Continue reading »

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Jul 24

Grid-Stock-Exchange-Economy-Finance

Commodities Collapsed Just Before The Last Stock Market Crash – So Guess What Is Happening Right Now? (Economic Collapse, July 22, 2015):

If we were going to see a stock market crash in the United States in the fall of 2015 (to use a hypothetical example), we would expect to see commodity prices begin to crash a few months ahead of time.  This is precisely what happened just before the great financial crisis of 2008, and we are watching the exact same thing happen again right now.  On Wednesday, commodities got absolutely pummeled, and at this point the Bloomberg Commodity Index is down a whopping 26 percent over the past twelve months.  When global economic activity slows down, demand for raw materials sinks and prices drop.  So important global commodities such as copper, iron ore, aluminum, zinc, nickel, lead, tin and lumber are all considered to be key “leading indicators” that can tell us a lot about where things are heading next.  And what they are telling us right now is that we are rapidly approaching a global economic meltdown.

If the global economy was actually healthy and expanding, the demand for commodities would be increasing and that would tend to drive prices up.  But instead, prices continue to go down. Continue reading »

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Jul 23

The Hunt For The “Mystery” Gold “Bear Raid” Leader Begins (ZeroHedge, July 23, 2015):

In the immediate aftermath of Sunday night’s massive gold slam, which was oddly reminiscent of the great silver crash of 2011 when on May 1 just around 6:25pm, silver plunged by 15%, from $48 to $42 with no news or catalyst…

Silver 5.1

Continue reading »

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Jul 23

Flashback:

GAO Audit Of The Federal Reserve Reveals $16 TRILLION In Secret Bailouts

The Federal Reserve And The $16 Trillion Bankster Bailout

Audit: Federal Reserve Gave $16 TRILLION In Emergency Loans To The Banksters


China- Toast-To-Market-Manipulation

China Spends 10% Of GDP On “All Bark, No Bite” Stock Bailout (ZeroHedge, July 23, 2015):

“With so many retail investors in China’s stock market, a collapse of share prices affects people’s savings, incomes and welfare. Many no doubt invested because they were confident in the government’s capacity to rescue the market. This may explain, in part, why Beijing intervened so quickly when the market plummeted. Still, while Beijing’s instinct to protect investors is understandable, the best way of doing so is to create a modern capital market.”

The quote featured above is from an FT op-ed penned by none other than everyone’s favorite bazooka-wielding, ex-Goldmanite Hank Paulson and as you might have gathered, there’s something particularly amusing about the former Treasury Secretary’s message to China. Continue reading »

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Jul 23

11 Economic Crashes That Are Happening RIGHT NOW

Commodities Collapsed Just Before The Last Stock Market Crash – So Guess What Is Happening Right Now? (Economic Collapse, July 23, 2015):

If we were going to see a stock market crash in the United States in the fall of 2015 (to use a hypothetical example), we would expect to see commodity prices begin to crash a few months ahead of time.  This is precisely what happened just before the great financial crisis of 2008, and we are watching the exact same thing happen again right now.  On Wednesday, commodities got absolutely pummeled, and at this point the Bloomberg Commodity Index is down a whopping 26 percent over the past twelve months.  When global economic activity slows down, demand for raw materials sinks and prices drop.  So important global commodities such as copper, iron ore, aluminum, zinc, nickel, lead, tin and lumber are all considered to be key “leading indicators” that can tell us a lot about where things are heading next.  And what they are telling us right now is that we are rapidly approaching a global economic meltdown.

If the global economy was actually healthy and expanding, the demand for commodities would be increasing and that would tend to drive prices up.  But instead, prices continue to go down. Continue reading »

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Jul 23

Fannie-Freddie-Taxpayer

New York Times Reports – “Fannie and Freddie are Back, Bigger and Badder Than Ever” (Liberty Blitzkrieg, July 22, 2015):

Just in case you still harbored any doubt that absolutely zero lessons were learned from the cataclysmic financial collapse of 2008/09. We learn from the New York Times that:

AFTER the financial crisis of 2008, there was one thing that almost everyone agreed on. The government-sponsored mortgage giants, Fannie Mae and Freddie Mac, had to go. While shareholders and executives reaped the profits from Fannie and Freddie in good times, taxpayers were stuck with the bill in a crisis. President Obama described their dysfunctional business model as “Heads we win, tails you lose.” But here we are, seven years after the crisis, and nothing has changed. Continue reading »

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Jul 23

Twelve

12 Ways The Economy Is Already In Worse Shape Than It Was During The Depths Of The Last Recession (Economic Collapse, July 21, 2015):

Did you know that the percentage of children in the United States that are living in poverty is actually significantly higher than it was back in 2008?  When I write about an “economic collapse”, most people think of a collapse of the financial markets.  And without a doubt, one is coming very shortly, but let us not neglect the long-term economic collapse that is already happening all around us.  In this article, I am going to share with you a bunch of charts and statistics that show that economic conditions are already substantially worse than they were during the last financial crisis in a whole bunch of different ways.  Unfortunately, in our 48 hour news cycle world, a slow and steady decline does not produce many “sexy headlines”.  Those of us that are news junkies (myself included) are always looking for things that will shock us.  But if you stand back and take a broader view of things, what has been happening to the U.S. economy truly is quite shocking.

The following are 12 ways that the U.S. economy is already in worse shape than it was during the depths of the last recession: Continue reading »

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Jul 22

twinkies

$900 Million Payday Is Billionaires’ Reward For Crushing Twinkie-Maker’s Labor Unions (ZeroHedge, July 22, 2015):

Two days ago we reported that according to the new Chief Restructuring Officer of America’s “first national supermarket chain”, Great Atlantic & Pacific, also known as A&P, Superfresh and Pathmark supermarkets, which just filed its second chapter 11 bankruptcy protection in 5 years, it did so for one main reason: unions, and specifically legacy Collective Bargaining Agreements which made profitability for the (heavily levered) company impossible.

While that argument is debatable, and as we said “if it wasn’t for unions, it would be something else, like loading up on massive amounts of debt to repay Yucaipa’s equity investment, which would then be unsustainable once rates rose and once interest expense became so high it soaked up all the company’s cash flow” one thing that is absolutely certain is that what A&P just did is a flashback to what Twinkies’ maker Hostess itself did as part of its November 2012 Chapter 7 bankruptcy liquidation. Continue reading »

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Jul 22

… the Greatest Depression.


Forget Recession: According To Caterpillar There Is A Full-Blown Global Depression (ZeroHedge, July 22, 2015):

There has now been an unprecedented 31 consecutive months of CAT retail sales declines. This compares to “only” 19 during the near systemic collapse in 2008.  In other words, if global demand for heavy industrial machinery, as opposed to unemployed millennials’ demands for $0.99 Apple apps, is any indication of the true underlying economy, forget recession: the world is now in a second great depression which is getting worse by the month.

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Jul 22

Ongoing Greece Deposit Run Forces ECB To Boost Greek ELA Ceiling Yet Again (ZeroHedge, July 22, 2015):

Despite the imploring of Greek bankers for Greeks to “take your money out of your chests and houses – which are not safe in any case – and deposit at banks,” it appears the Greek bank deposit run continues. As The ECB just announced another €900 million increase in Emergency Liquidity Assistance, strongly suggesting that in the 2 days since the last increase, banks are once again insolvent facing a liquidity crunch as the “banks are trustworthy” propaganda falls on very deaf Greek ears.

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Jul 22

It’s Not Just Greece: Total European Debt Hits New All Time High (ZeroHedge, July 22, 2015)

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Jul 22

And so it begins …


China’s Record Dumping Of US Treasuries Leaves Goldman Speechless (ZeroHedge, July 22, 2015):

On Friday, alongside China’s announcement that it had bought over 600 tons of gold in “one month”, the PBOC released another very important data point: its total foreign exchange reserves, which declined by $17.3 billion to $3,694 billion.

China gold reserves revised_0

We then put China’s change in FX reserves alongside the total Treasury holdings of China and its “anonymous” offshore Treasury dealer Euroclear (aka “Belgium”) as released by TIC, and found that the dramatic relationship which we first discovered back in May, has persisted – namely virtually the entire delta in Chinese FX reserves come via China’s US Treasury holdings. As in they are being aggressively sold, to the tune of $107 billion in Treasury sales so far in 2015.

China vs Reserves

We explained all of his on Friday in China Dumps Record $143 Billion In US Treasurys In Three Months Via Belgium, and frankly we have been surprised that this extremely important topic has not gotten broader attention.

Then, to our relief, first JPM noticed. This is what Nikolaos Panigirtzoglou, author of Flows and Liquidity had to say on the topic of China’s dramatic reserve liquidation

Looking at China more specifically, it appears that, after adjusting for currency changes, Chinese FX reserves were depleted for a fourth straight quarter by around $50bn in Q2. The cumulative reserve depletion between Q3 2014 and Q2 2015 is $160bn after adjusting for currency changes. At the same time, a current account surplus in Q2 combined with a drawdown in reserves suggests that capital outflows from China continued for the fifth straight quarter. Assuming a current account surplus in Q2 of around $92bn, i.e. $16bn higher than in Q1 due to higher merchandise trade surplus, we estimate that around $142bn of capital left China in Q2, similar to the previous quarter.

JPM conclusion is actually quite stunning:

This brings the cumulative capital outflow over the past five quarters to $520bn. Again, we approximate capital flow from the change in FX reserves minus the current account balance for each previous quarter to arrive at this estimate (Figure 2). Continue reading »

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Jul 22

Chinese Stocks Slide Into Red After Business Sentiment Crashes To 6-Year Lows (ZeroHedge, July 21, 2015):

After a modesly positive open, Chinese stocks have pushed back into the red after Chinese business sentiment collapsed in July. The MNI China Business Indicator fell a straggering 8.8pts to 48.8 in July (below 50 signifying pessimism) – the lowest since January 2009. It appears the encouraging bounce after the massive creduit injections into June has been eviscerated and future expectations also dropped 6.4 to 54.1 in July (below the long-run average). While bad news is good news for much of the rest of the world, for China, as it continues to try to project a strong underlying economy to sustain its still extremely rich stock market, bad news is bad news.

Weakest business sentiment since Jan 2009…

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and stocks are not getting a bounce from the need for moar stimulus that this implies… Continue reading »

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