Has the economic world ended? The American Icon has moved to India. This is a dark day for the Harley Guys.
Will they have to fly the Indian flag along with the American flag when they come to Sturgis this year? Instead of the low wave Harley guys are going to Namaste each other.
Not a bad return for $200 million a day. I bet you will be able to buy some cheap Harleys soon. I am turning mine in for a Rice Rocket.
Harley-Davidson to build bikes in India November 04, 2010|By Sara Sidner, CNN
The iconic American motorcycle brand, Harley-Davidson, has announced plans to build an assembly plant in India.
Harley-Davidson, the iconic American motorcycle brand with a cult-like following, has announced it has chosen to build its second assembly plant ever outside the United States in India.
The "complete knock down" plant or CKD is expected to be up and running in the northern Indian state of Haryana in first half of 2011. Parts made in America will be put together for the Indian market in Haryana.
"What we are doing is made in USA, assembled in India, which will have a positive job effect back home which is why we are driving this investment as quickly as we are," Anoop Prakash managing director for Harley Davidson India told CNN.
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Jim Sinclair’s Commentary
My prediction is fifty dollars richer, on or before Jan 14, 2011, and much better looking.
Gold’s 7 Parabolic C Waves – Projection $1,600 By John Townsend
Nov 8 2010 9:15AM
I believe that gold has traded in a repetitive ABCD pattern since the inception of its secular bull market in late 2001. The C wave of the pattern has characteristically concluded with a parabolic, near vertical ascent of price. We are currently in a C wave and I expect that our immediate future will witness a truly exciting and hair raising parabolic advance that will likely take gold to $1,600.
This study will show you each of the C waves since 2001, and conclude with our current situation.
One of the fascinating aspects of gold’s progress from $260 in December 2001 to today’s near $1,400 level is not only this repetitive ABCD pattern (7 times so far), but also the use of the 50% Fibonacci measurement to define the half way point of each parabolic C wave.
The earliest ABCD patterns were relatively small, both in terms of time frame and size, and relatively simple. They were essentially straight line ‘near vertical’ moves. As the pattern has evolved, the C wave morphed into larger and more complicated structures while maintaining its fundamental and well defined mold. Following the near vertical straight line, C waves introduced a double top structure, followed by the use of bull flags and then the consolidation pennant. The present C wave appears to have morphed into a gigantic 3 phase super structure, surpassing all previous C waves in complexity and size.
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Jim Sinclair’s Commentary
This is getting hotter. With Rico attached the suit will be settled.
The defendants will swear not to settle, then they will try to increase the cost of the suit for the claimant by papering them to death in order to get the claimant’s attorney to scream settle. This is especially true if the suit is a class action.
If the suit is a class action the claimant’s attorney will settle on behalf of the class litigants
Whistleblower accuses HSBC and JP Morgan of silver futures scam
Banking giants HSBC and JP Morgan have been accused of "intentionally and unlawfully" suppressing the price of silver futures traded on the Comex exchange in New York after an ex-employee of Goldman Sachs in London blew the whistle on the scheme. By Garry White
Published: 6:10AM GMT 08 Nov 2010
In a lawsuit filed in New York last week, trader Eric Nalven has launched a class action suit against the two banks, claiming they "artificially depressed the price of silver dramatically downward" in a scheme that netted the banks "substantial illegal profits".
This follows two suits filed at the end of October against both banking groups, one of which claimed the "defendants reaped hundreds of millions of dollars, if not billions of dollars in profits" from the conspiracy.
The ex-Goldman Sachs employee, a veteran of 40 years, reported the two banks activities to the US derivatives regulator, the Commodity Futures Trading Commission (CFTC), which has been conducting an investigation into the manipulation of the silver market.
The whistleblower claims he was told about the conspiracy and scheme by traders.
A spokesman for JP Morgan declined to comment.
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The World Bank thinks there is merit in gold. This should be no surprise to you, nor should you be surprised when the Euro zone announced QE2.
Consider Gold in Overhaul of Bretton Woods, World Bank Head Writes in FT By John Simpson – Nov 7, 2010 5:27 PM ET
The development of a monetary system to follow on from 1971’s Bretton Woods II will take time, but it’s time to start, World Bank President Robert Zoellick writes in the Financial Times.
This week’s summit of the Group of 20 leading economies in Seoul presents a test of international cooperation offering an opportunity for a key group of G20 countries to agree on parallel agendas of structural reform, Zoellick writes.
For instance, the U.S. and China could reach agreement on mutually reinforcing moves to stimulate further growth, such as a course for yuan appreciation, or a move to wide bands for exchange rates, the World Bank chief writes.
Other major economies should agree to forgo currency intervention, except in rare situations agreed to by others, Zoellick says. These moves would help emerging economies to deal with asymmetries in recoveries by applying flexible exchange rates and independent monetary policies, he writes.
The system should evaluate using gold as a reference point of market expectations about inflation, deflation and future currency values, Zoellick writes, noting that while textbooks may view gold as “old money,” markets use it today as an alternative monetary asset.
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Jim Sinclair’s Commentary
Sir Richard the Great has it nailed.
Not just inflation fears boosting gold
Commentary: Key letters see other reasons for metal’s gains By Peter Brimelow,
Nov. 8, 2010, 12:57 a.m. EST
NEW YORK (MarketWatch) — Gold goes onwards and upwards. And key letters say there are reasons beyond looming inflation.
The metal’s friends must be wondering if it gets any better. The CME December gold contract rose $50.10 (2.95%) last week to close at a record high of $1,397.70. Silver, which many old precious-metals hands consider to be a purer reflection of U.S. speculative sentiment, was up even more.
What’s more, gold expressed in euros managed to get above the early-September high. Gold expressed in U.S. dollars had risen substantially since then, and gold bears were pointing at the lack of progress in gold in other major currencies as evidence that the move was vulnerable. That argument has now failed.
Even the long-sluggish gold shares behaved. The ARCA Gold Bugs managed (at last!) to get above the 2008 high, achieved when gold was first briefly over $1,000; it managed a 5.3% appreciation for the week. It closed at an all-time high.
Dow Theory Letters’ Richard Russell points out that the major-gold-share exchange-traded fund Market Vectors Gold Miners ETF is now being outpaced by the junior-share vehicle Market Vectors Junior Gold Miners.
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Jim Sinclair’s Commentary
Yell and scream they will. QE2-Euro is on the menu.
Interview With German Finance Minister Schäuble
‘The US Has Lived on Borrowed Money for Too Long’ 11/08/2010
In an interview with SPIEGEL, German Finance Minister Wolfgang Schäuble, 68, criticizes US calls for Germany to reduce exports, outlines his plans for an insolvency framework for indebted European nations and the emphasizes the significance of the German-French axis for Europe.
SPIEGEL: Minister Schäuble, how well do you get along with your American counterpart, Treasury Secretary Timothy Geithner?
Schäuble: Mr. Geithner is an excellent minister. We have a good personal relationship.
SPIEGEL: Nevertheless, he constantly criticizes government officials in countries that are achieving high export surpluses and not doing enough to stimulate their domestic economies. He’s referring to you, isn’t he?
Schäuble: It would appear that way. That’s why I tell him again and again that I think his point of view is incorrect in this regard.
SPIEGEL: All the same, the value of goods Germany sold to the United States exceeded imports from that country by almost €14 billion ($19.8 billion) last year. Can’t you understand that the American treasury secretary is concerned about this?
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Greetings Jim,
In September, gold broke out to a new long-term high, but our Gold Currency Index (GCI) lagged, creating a slight negative divergence that signaled caution. Since then, the negative divergence has been cleared and a positive divergence has begun to develop since the Federal Reserve announced the next quantitative easing program last week. While both daily charts are bullish, the GCI is strengthening even faster than gold in US dollar terms.
 |
 |
Best,
CIGA Erik
Prometheus Market Insight
http://www.prometheusmi.com
Filed under: USAWatchdog.com
Courtesy of Greg Hunter’s USAWatchdog.com
Dear CIGAs,
Last week’s decision by the Fed to start another round of Quantitative Easing was met with only one dissenting vote by the Federal Open Market Committee. That does not mean everybody in the rest of the world thinks this is a good idea. Any country holding dollars is faced with a decrease in buying power. Some of the most powerful members of the G-20 are highly critical of the Fed’s money printing. Germany, Brazil and China all made negative comments about the Fed’s latest round of QE in a Bloomberg article over the weekend. It reported, “It’s our problem as well if the U.S. is no longer certain that the old recipes don’t work anymore,” German Finance Minister Wolfgang Schaeuble said yesterday in Berlin. The Fed’s injection of $600 billion was “clueless” and won’t revive growth, he said. Brazil’s central bank president, Henrique Meirelles, said “excess liquidity” in the U.S. economy is creating “risks for everyone.” In China, Vice Foreign Minister Cui Tiankai said “many countries are worried about the impact of the policy on their economies.” He also said the U.S. “owes us some explanation on their decision on quantitative easing.” (Click here for the complete Bloomberg article.)
Still, Fed Chief Bernanke is unwavering in the decision to print money to revive the economy. The same Bloomberg article quoted Mr. Bernanke, “Our first objective, the first goal that we have, is to meet our mandate to get price stability and maximum employment in the United States . . . A strong U.S. economy, a recovering economy, is critical not just for Americans but it’s also critical for the global recovery.” The rest of the world is clearly not buying the idea that the Fed is saving the world economy. So what would make the Fed so defiant in the face of such global criticism? I think the Fed is really worried about mortgage interest rates and declining home prices. I bring out my favorite updated chart of mortgage resets for adjustable rate mortgages. The chart below shows a tsunami of resets that will not crescendo until late 2012. Study it for yourself:
Look at what happened just a day after the Fed announced $75 billion a month of money printing to buy up Treasuries that, in turn, pushed down interest rates. Frank Nothaft, vice president and chief economist at Freddie Mac, said last week, “With little sign of inflation to push up long-term interest rates, fixed mortgage rates held relatively steady this week, while ARM rates hit new all-time record lows.” (Click here for the complete statement from Freddie Mac.)
More…
Posted: Nov 08 2010 By: Dan Norcini Post Edited: November 8, 2010 at 2:34 pm
Filed under: Trader Dan Norcini
Dear CIGAs,
It is fascinating watching the transition occurring in the gold market from purely a dollar related phenomenon to one in which it is moving as a currency in its own right. Early in the session, the Euro was under strong pressure that brought in a general wave of selling into both gold and silver, even as silver was making a fresh 30 year high. That selling took both metals down on the day, with gold in particular seeing more weakness than silver. About mid-morning however, buyers showed up in size and brought about an abrupt about-face in both markets with silver roaring above $27.50 and gold clearing $1400 with relative ease.
To see these markets shrug off Dollar strength is just one more indication that they are moving on their own merits and that those buying them in such quantity are looking well past any short term blips in the Dollar. What we are seeing is further evidence that the current global monetary system is under extreme stress and many investors world-wide are rapidly losing confidence in both it and its managers. This is the reason that the perma bears in both metals are in serious trouble for they are now coming face to face with a crowd that is not the least bit impressed by their ability to formerly engineer price sell offs. Buyers are in control and the bears damn well know it.
The same holds true for the hedge funds who have now met their Waterloo in that infernal ratio trade of theirs that for far too long kept the mining shares severely undervalued in relation to the bullion price of both metals. As mentioned in the recent radio interview, the gap higher in the HUI is now confirmed as a breakaway gap, and not an exhaustion gap on the technical charts. Depending on the extent of those hedge funds still trapped in that ratio trade and the extent of others in that same crowd who smell blood in the water, the shares could easily outperform on the upside as buyers outnumber sellers at current levels.
What is most remarkable is that this is occurring even in the face of general equity market weakness. I think it is fairly safe to say that the mining shares are separating themselves from the performance of the broader markets with buyers beginning to focus on their earnings and increasing profit margins instead of the fickle sentiment towards risk trades or risk aversion trades. I will attempt to post an updated HUI/Gold ratio chart after the close of trading today to give the readers a view of how that chart is changing.
“Bubble, bubble, toil and trouble; fire burn and cauldron bubble”. I’ve taken a few liberties with Shakespeare’s witches in Macbeth (Double, double) to illustrate that if the Fed has desired to puff up another bubble, they have gotten their wish but for the rest of us who have to live with their mendacity, it will end with toil and trouble. I say, “mendacity”, because it is a lie that inflation can be controlled. Now the Fed may believe their own lies but the truth is that they cannot control the fears and suspicions of the public who have now lost confidence (that ethereal, fleeting substance which cannot easily be defined but once forfeited is nigh impossible to regain) in their attempted management of the economy. We will yet see more woes resulting from this ill-conceived course which is going to contribute to the eventual ruin of the Dollar and with it, our way of life.
That brings me to crude oil – I keep focusing on the energy markets because they have heretofore been somewhat tame and have not participated to any extent in the overall commodity sector ramp in prices. That seems to now be changing with crude dangerously flirting with a close above the technically significant $87 level. That is the last line of defense against a run towards the $90 level. Even natural gas, which has been comatose is clawing above the $4 market, which will extremely cheap by most standards of comparison, is significantly higher than its level a mere two week’s ago. Watch out for the double whammy of both rising food and energy prices.
I think this the reason that the bonds on the long end are refusing to move higher to any degree. Based on what we have seen of that market, buyers were formerly giddy with delight at the idea that the Fed was there to backstop them with more QE. What appears to be happening however is that bonds on the long end are having to now deal with what many are seeing is an unavoidable surge in inflation, which of course is the nemesis to bond holders. They are perched quite tenuously above a strong chart support level just below the 130 mark. Should that give way it will indicate that the ability of the long bond to levitate higher in the face of massive supply concerns has given way to larger fears of the effects of Bernanke’s foolish QE infusion. Is this the end of the decade plus bull market in the long bond? The jury is still out but we will soon learn its verdict.
Technical levels in gold are as follows: Resistance should appear near the $1,420 level. Above that $1,440 comes into play. Downside initial support lies close to $1,380 followed by $1,370 and then $1,355.
Silver is blowing through upside resistance levels so quickly that is almost seems futile to list them. $30 now seems easily attainable given the ease with which it knifed through $27. Indeed, silver is moving in what can now be described as parabolic fashion based on the steep angle of ascent on the technical price charts. Open interest readings do not yet indicate a commercial signal failure is occurring but there are evidentially shorts that are getting their heads handed to them and are bailing out. It might be the swap dealers who based on the last COT report were attempting to move towards being flat but they do not hold the lion’s share of the short positions in the market. The big “commercial” class is the ones I am watching for signs of throwing in the towel. Personally I do not see how they can go much longer given the size of that naked short position and the enormous paper losses that they are incurring in what is left of their dwindling trading accounts. We all know that they are extremely well capitalized but someone as well capitalized as they are continues to buy so it is now a matter of how much more pain they can withstand.
The Dollar is seeing a bit of upside follow through from last Friday’s session but it would have to get above 78.50 to convince me that there is anything more to this than a bounce in a long term bear market.
Oh, and by the way, cotton is yet again locked limit up with no end in sight to its rise. A lot of North Texas cotton growers are going to be extremely prosperous at this rate and will soon become lords and barons. As said many times now since its rise, that market terrifies me as I wonder who will become the last buyer just before it plunges.
Click chart to enlarge today’s hourly action in Gold in PDF format with commentary from Trader Dan Norcini
It is fascinating watching the transition occurring in the gold market from purely a dollar related phenomenon to one in which it is moving as a currency in its own right. Early in the session, the Euro was under strong pressure that brought in a general wave of selling into both gold and silver, even as silver was making a fresh 30 year high. That selling took both metals down on the day, with gold in particular seeing more weakness than silver. About mid-morning however, buyers showed up in size and brought about an abrupt about-face in both markets with silver roaring above $27.50 and gold clearing $1400 with relative ease.
To see these markets shrug off Dollar strength is just one more indication that they are moving on their own merits and that those buying them in such quantity are looking well past any short term blips in the Dollar. What we are seeing is further evidence that the current global monetary system is under extreme stress and many investors world-wide are rapidly losing confidence in both it and its managers. This is the reason that the perma bears in both metals are in serious trouble for they are now coming face to face with a crowd that is not the least bit impressed by their ability to formerly engineer price sell offs. Buyers are in control and the bears damn well know it.
The same holds true for the hedge funds who have now met their Waterloo in that infernal ratio trade of theirs that for far too long kept the mining shares severely undervalued in relation to the bullion price of both metals. As mentioned in the recent radio interview, the gap higher in the HUI is now confirmed as a breakaway gap, and not an exhaustion gap on the technical charts. Depending on the extent of those hedge funds still trapped in that ratio trade and the extent of others in that same crowd who smell blood in the water, the shares could easily outperform on the upside as buyers outnumber sellers at current levels.
What is most remarkable is that this is occurring even in the face of general equity market weakness. I think it is fairly safe to say that the mining shares are separating themselves from the performance of the broader markets with buyers beginning to focus on their earnings and increasing profit margins instead of the fickle sentiment towards risk trades or risk aversion trades. I will attempt to post an updated HUI/Gold ratio chart after the close of trading today to give the readers a view of how that chart is changing.
“Bubble, bubble, toil and trouble; fire burn and cauldron bubble”. I’ve taken a few liberties with Shakespeare’s witches in Macbeth (Double, double) to illustrate that if the Fed has desired to puff up another bubble, they have gotten their wish but for the rest of us who have to live with their mendacity, it will end with toil and trouble. I say, “mendacity”, because it is a lie that inflation can be controlled. Now the Fed may believe their own lies but the truth is that they cannot control the fears and suspicions of the public who have now lost confidence (that ethereal, fleeting substance which cannot easily be defined but once forfeited is nigh impossible to regain) in their attempted management of the economy. We will yet see more woes resulting from this ill-conceived course which is going to contribute to the eventual ruin of the Dollar and with it, our way of life.
That brings me to crude oil – I keep focusing on the energy markets because they have heretofore been somewhat tame and have not participated to any extent in the overall commodity sector ramp in prices. That seems to now be changing with crude dangerously flirting with a close above the technically significant $87 level. That is the last line of defense against a run towards the $90 level. Even natural gas, which has been comatose is clawing above the $4 market, which will extremely cheap by most standards of comparison, is significantly higher than its level a mere two week’s ago. Watch out for the double whammy of both rising food and energy prices.
I think this the reason that the bonds on the long end are refusing to move higher to any degree. Based on what we have seen of that market, buyers were formerly giddy with delight at the idea that the Fed was there to backstop them with more QE. What appears to be happening however is that bonds on the long end are having to now deal with what many are seeing is an unavoidable surge in inflation, which of course is the nemesis to bond holders. They are perched quite tenuously above a strong chart support level just below the 130 mark. Should that give way it will indicate that the ability of the long bond to levitate higher in the face of massive supply concerns has given way to larger fears of the effects of Bernanke’s foolish QE infusion. Is this the end of the decade plus bull market in the long bond? The jury is still out but we will soon learn its verdict.
Technical levels in gold are as follows: Resistance should appear near the $1,420 level. Above that $1,440 comes into play. Downside initial support lies close to $1,380 followed by $1,370 and then $1,355.
Silver is blowing through upside resistance levels so quickly that is almost seems futile to list them. $30 now seems easily attainable given the ease with which it knifed through $27. Indeed, silver is moving in what can now be described as parabolic fashion based on the steep angle of ascent on the technical price charts. Open interest readings do not yet indicate a commercial signal failure is occurring but there are evidentially shorts that are getting their heads handed to them and are bailing out. It might be the swap dealers who based on the last COT report were attempting to move towards being flat but they do not hold the lion’s share of the short positions in the market. The big “commercial” class is the ones I am watching for signs of throwing in the towel. Personally I do not see how they can go much longer given the size of that naked short position and the enormous paper losses that they are incurring in what is left of their dwindling trading accounts. We all know that they are extremely well capitalized but someone as well capitalized as they are continues to buy so it is now a matter of how much more pain they can withstand.
The Dollar is seeing a bit of upside follow through from last Friday’s session but it would have to get above 78.50 to convince me that there is anything more to this than a bounce in a long term bear market.
Oh, and by the way, cotton is yet again locked limit up with no end in sight to its rise. A lot of North Texas cotton growers are going to be extremely prosperous at this rate and will soon become lords and barons. As said many times now since its rise, that market terrifies me as I wonder who will become the last buyer just before it plunges.
Click chart to enlarge today’s hourly action in Gold in PDF format with commentary from Trader Dan Norcini
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/charts/metals/gold/t24_au_en_usoz_2.gif)
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/charts/metals/silver/t24_ag_en_usoz_2.gif)
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