Gold rebounds solidly/silver follows gold's lead/S and P downgrades French bank Agricole

posted by Harvey Organ at Harvey Organ's - The Daily Gold and Silver Report - 11 minutes ago

Good morning Ladies and Gentlemen: As is my custom on Saturday, let me introduce to you the latest 3 entrants into the banking morgue: courtesy of PressTV: Three more U.S. banks have failed, bringing thi...

The Extended Confessions Of An Economic Hit Man 

Submitted by Tyler Durden on 05/20/2011 17:03 -0400

The book "Confessions of an Economic Hit Man" by John Perkins is easily one of the most engrossing pieces of non-fiction one can read to learn about the true drivers behind globalization, espionage, corporate cronyism, the emergence of such "artificial" organizations as the World Bank and the IMF, and most importantly, debt "enslavement", all as seen from an insider's view. It explains in simple words why over the past 40 years the developing world paradigm has been exploited as heavily as it has, why the BRIC concept was instrumental as a Red Herring to perpetuating the myth of endless growth, and why credit must always flow no matter what to keep the status quo in power. For those who have read the book, and for those who are on the fence about reading it, below we present the three part presentation by John Perkins at the 2006 Veterans for Peace National Convention in which he expounds on all the key ideas in his book, and does an extended Q&A covering topics not discussed previously. We urge everyone to spend at least a few minutes listening to Perkins who gives a unique and non-conflicted expert opinion on the primary force for why the the modern equivalent of enslavement is not by force, but by debt. 

What Current Hedge Fund Exposure Means For Stocks, And Weekly Chartology 

Submitted by Tyler Durden on 05/21/2011 09:57 -0400

Yesterday we presented the latest 13F quarterly compilation summary, as prepared by Goldman's David Kostin, in raw format. Today, we bring you his high level observations on what this update means for stocks from a big picture perspective, as well as thematically. "We estimate hedge funds own roughly 3% of the US equity market. Turnover of all hedge fund positions averaged 32% during 1Q 2011 (roughly 130% annualized). The tilt of hedge fund holdings towards large-cap stocks has been increasing for almost 10 years. The typical hedge fund operates 48% net long, flat versus 4Q 2010. Combining long and short position data, hedge funds have the greatest net portfolio exposure to Consumer Discretionary (18%), Information Technology (16%), and Energy (14%). Our Hedge Fund VIP basket has 15 new constituents: SSCC, BP, MRO, PCLN, VRX, TEVA, YHOO, CVX, MET, NFLX, MA, SINA, CHK, EQIX, and ESV." In addition, for all you technicians, here is the full weekly chartporn from GS. 

More "Change You Can Believe In"... How's That Hopey Changey thing Working out For You ?

US Debt And The Presidents Responsible 

Submitted by Tyler Durden on 05/20/2011 19:58 -0400

Presented without commentary

S&P Lowers Italy Outlook To Negative 

Submitted by Tyler Durden on 05/20/2011 19:50 -0400

First Credit Agricole, now Italy....Maestro: the EUR take down orchestra is reaching the fortissimo cadenza. Next up: the glissando. "On May 20, 2011, Standard & Poor's Ratings Services revised its outlook on the ratings on the Republic of Italy to negative from stable to reflect its views of the heightened downside risks in the government's debt reduction plan. At the same time, Standard & Poor's affirmed its 'A+' long-term and 'A-1+' short-term sovereign credit ratings on Italy. The transfer and convertibility assessment remains at 'AAA'." The negative ratings outlook on Italy (unsolicited rating A+/Negative/A-1+) reflects Standard & Poor's view of the increased downside risks to the Italian government's debt-reduction plan because of potentially weaker-than-expected economic growth and possible political gridlock that could contribute to fiscal slippage. The diminished growth prospects stem from what we consider to be a lack of political commitment to deregulating the labor market and introducing reforms to boost productivity. We believe measures to reduce the bottlenecks and rigidities in Italy's economy are especially important in light of Italy's limited monetary flexibility, which stems from its membership in the European Monetary Union and its limited fiscal room to maneuver because of Italy's high government debt burden." 

USD Short Covering, EUR Capitulation Ending, Silver Spec Longs At Two Year Lows 

Submitted by Tyler Durden on 05/20/2011 16:29 -0400

As we expected, the recent rout in the EUR and the spike in the USD have largely kicked out all marginal speculative elements. As the first chart below indicates, as of May 17 net non-commercial spec EUR contracts dropped by 19.8k from 61.4k to 41.6k, nearly a third of the current bullish bet. And as that was happening, USD shorts were covering rapidly, confirmed by the weekly change from 4,563 contracts short to just 1,270, the most bullish position in the USD since January 2011, and roughly where it was back in October 2010. And probably more important, now that speculative fervor is all the talk, the silver net long positioning by non-commercials, contrary to conventional wisdom, is not only at an all time high, nor was it recently, but instead in the last week plunged to a level last seen back in April 2009. Net silver exposure has dropped by almost 60% since its recent peak in February (40,937 contracts), and at this point it seems all speculators have left the party. The new base is now being rebuilt based on much firmer hands.