Central Banks Purchase 127 Tons Of Gold In Q1 

Submitted by Tyler Durden on 05/12/2011 13:00 -0400

Most have heard by now that Mexico disclosed that back in Q1 it bought 93.1 tonnes of gold, increasing its total gold holdings from 7.1 tons to a whopping 100.2 total tons, a stunning move which was disclosed to have been done "in line with prudent diversification principles of reserves management." However, what is less known is that many other central banks, chief among them Russia and Thailand were also waving the shiny yellow metal in between January and March. And just as importantly, from the World Gold Council, from where this update comes: "The latest statistics show no significant selling by the signatory central banks in Year 2 of the third Central Bank Gold Agreement (CBGA3)." So no central banks sell, yet the daytrading retail public knows better. As for the key question of whether China is adding to its meager holdings of 1,054 tons, which put it behind the GLD, not to mention France and Italy, there is no update. Recall, however, that when China announced an addition of +454 tonnes of gold in April of 2009, this indicated stealthy purchases of the metal in the 2003-2009 period. In other words, China is very likely accumulating gold and the next update will likely come some time in 2015. 

 

 

 

 

War On "Speculators" Goes Global: Shanghai Gold Exchange Hikes Silver Margins For Third Time In A Month 

Submitted by Tyler Durden on 05/12/2011 08:29 -0400

Globalization sure can be fun: just as the Fed has now ordained Japan to carry out the global reliquification scheme in the form of a new, and powerful batch of QE, so the regional war on (Fed liquidity engorged) speculators has just gone global. Following 5 consecutive silver margin hikes by the CME (which oddly did nothing on yesterday's price collapse even as the silver vol surged to near record levels) at which point it would appear silly for the exchange to continue its speculator eradication campaign, the memo has now been sent to foreign bourses. Sure enough, the Shanghai Gold Exchange has just announced it is hiking both the silver margin to 19% as well as the price limit on gold to 13%.

 

 

 

SLV Trading At A Record Discount To NAV 

Submitted by Tyler Durden on 05/12/2011 12:38 -0400

Probably the strangest development in the world of ETFs today is that the silver ETF, SLV, was trading at a discount to its most recently disclosed NAV of 38.1932 at well over 10% earlier, when the spot price of silver dropped to just over $32: an all time record. So momentum-based and emotional is the trading in precious metal ETFs now that there appear to be gaping arbitrage opportunities within these high volume products. Granted, the NAV is updated once a day, and we expect that should today's silver paper price not revert to the NAV, that the NAV will decline. Alternatively, if the price drops, the discount to NAV could creep to yet another all time low. And while these are merely artificial ETF mechanics, which can and should not be traded merely for the sake of their manifestation in the market, the reality is that total COMEX silver just dropped to another fresh all time low, following another 250k ounce reclassification from Registered to Eligible, and the withdrawal of 444k ounces, offset by the receipt of 109.760 ounces by JPMorgan (of all COMEX banks). 

 

 

 

 

Chinese Frauds Account For 80% Of Nasdaq Permanent Trading Halts 

Submitted by Tyler Durden on 05/12/2011 11:20 -0400

In light of another fraud allegation against China Biotics which will likely soon join the Nasdaq trading halt page, we decided to take a quick look at the Nasdaq trading halts page. To our complete lack of surprise, Chinese fraud dominates with an iron fist: of 19 halted stocks (GFC has three classes of securities halted), 15 of the name are Chinese. Of these 15 Chinese names, none were on this list when we first warned of the imminent surge in reverse merger fraud back in November. Luckily, judging by the horrendous performance in recent Chinese IPOs, even with the criminal abdication of enforcement duty by the regulators, it appears that the gambling frenzy is over. Below we present the complete list of Nasdaq trading halts with Chinese names highlighted in red. No further commentary is necessary. And to all those who bought puts on these stocks, correctly predicting the names are nothing but mini ponzi schemes, please send your complaints to the SEC and the Nasdaq, which is more focused on raising HY debt to LBO any and every exchange still for sale, than actually monitoring what crap it floats. 

 

 

 

 

Fukushima Reactor 1 Fuel Rods Fully Exposed, Reactor 4 In Danger Of Collapsing 

Submitted by Tyler Durden on 05/12/2011 10:40 -0400

Remember Fukushima? The exploded nuclear power plant that everyone was talking about two months ago and now the media has imposed a complete blackout on, because out of print/page views, means out of radioactive spewage, right? Wrong. According to the latest update from a now government funded TEPCO, "fuel rods are fully exposed in the No. 1 reactor at its stricken Fukushima Dai-Ichi nuclear plant, setting back the utility’s plan to resolve the crisis. The water level is 1 meter (3.3 feet) below the base of the fuel assembly, Junichi Matsumoto, a general manager at the utility known as Tepco, told reporters at a briefing in Tokyo. Melted fuel has dropped to the bottom of the pressure vessel and is still being cooled, Matsumoto said. The company doesn’t know how long the rods have been exposed, he said." And apparently even more skeptics are emerging: "“I’ve been saying from the beginning the water tomb plan won’t work,” said Tadashi Narabayashi, a professor of nuclear engineering at Hokkaido University. “Tepco must work on a water circulation cooling system as soon as possible. They’ve been going round and round in circles and now realize this is what they need to do.” And the kicker: "It’s unlikely the situation has worsened with the discovery the rods are exposed because they’ve probably been out of the water since shortly after the crisis started, Narabayashi said." Which means that the situtation has indeed been dire from the very beginning, that TEPCO and the government have been lying, that radiation has been spewing, and that prevalent radiation is likely far higher than most have conceived. Pretty much as was predicted on Zero Hedge long ago.

Carbon Copy Commodity Crackdown Complete: And Now The Bounce And Another Margin Hike Frenzy? 

Submitted by Tyler Durden on 05/12/2011 10:18 -0400

And now the replica commodity crack down from last week is complete, with a near identical price action repeat of what happened last Thursday and Friday. 

 

 

 

 

 

 

 

Dick Bove Cuts Goldman To Sell, Lowers Price Target From $163 To $120 

Submitted by Tyler Durden on 05/12/2011 09:29 -0400

From a note: The rating on Goldman Sachs stock is being lowered to Sell from Neutral. The price target is being cut to $120 per share from $163 per share. It now appears that the pressure on the Justice Department to bring a criminal lawsuit against Goldman is building to a high pitch. The new Matt Taibbi article in Rolling Stone Magazine is another all-out attack on the company. However, this time the attack is backed by a 650 page Senate report signed by both a Democrat and a Republican. 

 

 

 

 

 

Trifecta Of Bad Data: Initial Claims Bad (New York Layoffs Surge), PPI Ugly, Retail Sales Miss 

Submitted by Tyler Durden on 05/12/2011 08:46 -0400

While last month's upward revised 478K number was not repeated, just released initial claims still continued at the NFP busting 434K, worse than consensus of 430K. At this level of initial ciams, the economy is losing about 50K jobs per month. According to the release, the primary factor was New York State, which saw a surge in Initial Claims of +24,431, due to "Layoffs in the transportation and service industries." Continuing claims were just as bad, at 3,756K on expectations of 3,700K, with the previous number revised, how else but, higher to 3,751K. And just as notably, the 99 week cliff impairs eve more people, as a total of 17K people dropped off EUC and Extended Benefits. Elsewhere, PPI came higher than expected, with April PPI data at 0.8% on expectations of 0.6%, up from 0.7% before, confirming that delayed downstream inflation effects will plague the economy for a long time. Concluding the trifecta of bad data was advance retail sales, which came at 0.5%, below expectations of 0.6%, with the previous revised much higher from 0.4% to 0.9%. And retail sales ex the volatile autos and gas was up a token 0.2%, compared to expectations of 0.5%, down from a revised 0.7%.