Raid on gold and silver on cue ahead of Jobs number

posted by Harvey Organ at Harvey Organ's - The Daily Gold and Silver Report - 5 hours ago

Good evening Ladies and Gentlemen: Tomorrow will be the release of the jobs number and as is the custom of the bankers they always raid gold on the day before the number is revealed.  Today was no exceptio...

 Update...

Borrowed a computer for a few days...still looking for a computer...

Hopefully everything will be back to normal tomorrow...
Any donations would be greatly appreciated, to help cover the cost of the computer...
Thanks
John

Pentagon Warns Of M.A.D. Should The War Powers Act Be Enacted And US Withdraw Its Troops From Libya

Submitted by Tyler Durden on 06/02/2011 14:54 -0400

Who says Mutual Assured Destruction is to be used only by bankers: our military leaders appear to have mastered the strategy of getting what they want to warning about all hell breaking loose, just as effectively. Reuters reports that should Congress pursue a resolution to withdraw from the humanitarian Libyian oil liberation force, currently headed by Sarkozy, it would send an "unhelpful message of disunity" to allies and foes alike. "Pentagon Press Secretary Geoff Morrell said that "once military forces are committed, such actions by Congress can have significant consequences," particularly on relations with members of the North Atlantic Treaty Organization. "It sends an unhelpful message of disunity and uncertainty to our troops, our allies and, most importantly, the Gaddafi regime," Morrell said in a statement in Singapore, where Defense Secretary Robert Gates arrived on Thursday to attend a security dialogue with Asian allies...Kucinich's measure would invoke the 1973 War Powers Resolution to direct Obama to stop the U.S. participation in the war. Kucinich says Obama violated the part of the law that prohibits U.S. armed forces from being involved in military actions for more than 60 days without congressional authorization." Kucinich seems to forget that reminding a constitutional lawyer about constitutional abuses is actually racist. And more importantly, what excuse will those hundreds of billions in "defense spending" by the US government have if America's military is relegated to "bankster" status in terms of utility.

EU Commission Denies Agreement On New Greek Aid Plan

Submitted by Tyler Durden on 06/02/2011 14:20 -0400

And.... U-turn

• EU COMMISSION DENIES AGREEMENT ON NEW GREEK AID PLAN

There is no point in even commenting on the cannonade of unbelievable bullshit coming out of Europe at this moment.
The central planners have now officially lost their minds.

Moody's Says It Expects To Place US Rating For Downgrade Review If No Progress On Increasing Statutory Debt Limit

Submitted by Tyler Durden on 06/02/2011 13:31 -0400

From Moodys, which now appears to have been hacked by Greece (in what may or may not be considered an act of war): "If the debt limit is raised and default avoided, the Aaa rating will be maintained. However, the rating outlook will depend on the outcome of negotiations on deficit reduction. A credible agreement on substantial deficit reduction would support a continued stable outlook; lack of such an agreement could prompt Moody's to change its outlook to negative on the Aaa rating....Although Moody's fully expected political wrangling prior to an increase in the statutory debt limit, the degree of entrenchment into conflicting positions has exceeded expectations. The heightened polarization over the debt limit has increased the odds of a short-lived default. If this situation remains unchanged in coming weeks, Moody's will place the rating under review."  Translation: unless America promises to increase its total debt to 120% of GDP in one year, the current debt which is just under 100% will be downgraded.

Postcards From Greece

These seem to be becoming quite popular lately: This particular one was titled: "Let them buy bonds." We are waiting to see how it will be revised following today's wonderful "Bailout #2" news.

Hourly Action In Gold From Trader Dan

June 2, 2011, at 12:02 pm
by Dan Norcini in the category Trader Dan Norcini |  Print This Post |  Email This Post

Dear CIGAs,
Near midmorning, chatter began occurring that a “lifeline” had been extended to Greece, some sort of new deal that would include the private sector, although the details remain sketchy. Supposedly those will be filled in and be completed near June 20, which is when the euro zone finance ministers are planning on next meeting. Regardless, the Euro shot up higher on the news and as it did, gold began seeing short covering and fresh buying surface. That buying took it back over chart support at the $1530 level, under which it had fallen earlier during the session.
Of course, the safe haven trade of buying the US Dollar evaporated on the Euro strength and back down towards 74 on the USDX it went.
The US equity markets then began moving off their lows and the long bond dropped rather dramatically. Silver recovered well off its worst levels of the session after falling below $36 at one point. Basically what happened was that the Greece news set off another round of risk trades which took many of the commodity markets either higher for the day or off their lows as the hedgies’ algorithms went crazy in the other direction after they unloaded everything earlier during the day.
More madness – more volatility. We are no longer trading; we are playing pin ball. At least the brokers must love it because they are making a damn fortune on the commissions with all these trades being yanked off, put back on again, yanked off and slammed back on once again. Lather, rinse, repeat.
Don’t even waste your time trying to discern any trends in this sort of insanity. Whatever the hedge fund algorithms decide to do at any given moment, is where the markets are going to go for the time being. It really all comes down to that. Either risk is in or risk is out. If it is out, equities and most commodities are going lower with bonds going higher. If it is in, equities and most commodities are going higher with bonds going lower. The general exception is gold which while it gets caught up somewhat in the selling tied to risk aversion trades, is holding very well as it is getting its own safe haven flows.
Gold is still range bound with a higher bias at the moment. The push to $1550, an initial target, was successful and that led to some short term oriented longs booking some profits. Support to the downside lies first near $1530 and then down towards $1512 or so should that give way. For a test of $1575 to occur, it needs to push through $1550 and hold that level on any round of profit taking.
Click chart to enlarge in PDF format with commentary from Trader Dan Norcini
For further market analysis and commentary, please see Trader Dan’s website at www.traderdan.net

 

 

In The News Today

June 2, 2011, at 8:06 am
by Jim Sinclair in the category In The News |  Print This Post |  Email This Post

Jim Sinclair’s Commentary

QE to infinity or the greatest depression of all human history. This is all thanks to our OTC derivative manufacturers and distributors who have not lost a beat in their endless creation of these weapons of mass Western financial destruction.

Horror for US Economy as Data Falls off Cliff Published: Wednesday, 1 Jun 2011 | 2:09 PM ET
By: Patrick Allen
The last month has been a horror show for the U.S. economy, with economic data falling off a cliff, according to Mike Riddell, a fund manager at M&G Investments in London.
"It seems that almost every bit of data about the health of the US economy has disappointed expectations recently," said Riddell, in a note sent to CNBC on Wednesday.
"US house prices have fallen by more than 5 percent year on year, pending home sales have collapsed and existing home sales disappointed, the trend of improving jobless claims has arrested, first quarter GDP wasn’t revised upwards by the 0.4 percent forecast, durables goods orders shrank, manufacturing surveys from Philadelphia Fed, Richmond Fed and Chicago Fed were all very disappointing."
"And that’s just in the last week and a bit," said Riddell.
Pointing to the dramatic turnaround in the Citigroup "Economic Surprise Index" for the United States, Riddell said the tumble in a matter of months to negative from positive is almost as bad as the situation before the collapse of Lehman Brothers in 2008.
More…




Jim Sinclair’s Commentary

Which means "QE to Infinity."

Employment Data May Be the Key to the President’s Job By BINYAMIN APPELBAUM
WASHINGTON — No American president since Franklin Delano Roosevelt has won a second term in office when the unemployment rate on Election Day topped 7.2 percent.
Seventeen months before the next election, it is increasingly clear that President Obama must defy that trend to keep his job.
Roughly 9 percent of Americans who want to go to work cannot find an employer. Companies are firing fewer people, but hiring remains anemic. And the vast majority of economic forecasters, including the president’s own advisers, predict only modest progress by November 2012.
The latest job numbers, due Friday, are expected to provide new cause for concern. Other indicators suggest the pace of growth is flagging. Weak manufacturing data, a gloomy reading on jobs in advance of Friday’s report and a drop in auto sales led the markets to their worst close since August, and those declines carried over into Asia Thursday.
But the grim reality of widespread unemployment is drawing little response from Washington. The Federal Reserve says it is all but tapped out. There is even less reason to expect Congressional action. Both Democrats and Republicans see clear steps to create jobs, but they are trying to walk in opposite directions and are making little progress.
More…




Jim Sinclair’s Commentary

QE to infinity.

Fed officials sing from same easy money hymn sheet.
Top Federal Reserve officials Sandra Pianalto and Janet Yellen have maintained that the bank’s easy money policies remain appropriate given the high unemployment rate. "We’ve got a long way to go before labor markets can be described as healthy again," said Pianalto. John Williams, president of the San Francisco Fed, said the Fed’s two rounds of asset purchases will have boosted GDP by about 3% and added about 3M jobs by the second half of 2012. Data from payrolls processing company ADP Employer Services yesterday showed that employment growth slowed sharply in May (.pdf), leading economists to cut their forecasts for government non-farm payroll figures, which are due out tomorrow.



Jim Sinclair’s Commentary

In this case the economy would implode instantly, bond rates explode, and the dollar as in the 70s (rising interest rates and rising inflation) would be annihilated, boosting the price of gold.
That is the "Rock and the Hard Place."

Washington, Beijing to Block Money Printing
Published: Thursday, 2 Jun 2011 | 4:05 AM ET
By: Patrick Allen
The economic data in the US is heading south and investors are beginning to question whether the Federal Reserve will extend its asset-buying program beyond the end of the month.
One economist though believes the forces against such a move make the chances of Ben Bernanke and the Federal Open Market Committee (FOMC) pulling the trigger on the third round of asset buying – also known under the acronym QE3 – slim.
“It seems Mr Bernanke would face major difficulties marshalling a FOMC consensus in favor of further monetary ease, even if he had a mind to do so,” said Stephen Lewis, the chief economist at Monument Securities in a research note.
Consensus on the FOMC is unlikely to be the biggest obstacle to QE3 according to Lewis.
“The balance of opinion on the FOMC is not the chief obstacle to the Fed’s prolonging its asset purchases.
More…




As I have said for over 3 years...they will print money until we run out of trees...QE to Infinity and Beyond...

Today we hear from 2 Fed officials who state their wish that QEIII should start immediately:

(courtesy Reuters)

Jobs malaise warrants easy policy: Fed officials

By Kristina Cooke

COLUMBUS Ohio | Thu Jun 2, 2011 12:20am EDT

(Reuters) - The high unemployment rate means the Fed's ultra-easy money policies remain the right course of action, top Federal Reserve officials said on Wednesday.

High unemployment is not a "quickly resolvable problem," but April's job gains show that the economic recovery is on a firmer footing, Cleveland Fed President Sandra Pianalto said.

"We've got a long way to go before labor markets can be described as healthy again," Pianalto told the Columbus Metropolitan Club.

Recent rises in food and energy prices mean inflation will likely be temporarily higher this year, she said. But both wages and the public's long-term expectations of inflation remain subdued, she noted.

Given that backdrop, she said, current monetary policy is appropriate. Pianalto's views tend to hew closely to those of Chairman Ben Bernanke and the center of the Fed's policy-setting committee.

Fed Vice Chair Janet Yellen similarly endorsed the Fed's stance of promising to hold rates near zero for an extended period as it completes $600 billion of bond purchases by the end of June.

"The current accommodative stance of U.S. monetary policy continues to be appropriate because the unemployment rate remains elevated and inflation is expected to remain subdued over the medium run," she said in a speech on assessing potential financial imbalances to a conference in Tokyo.

Once complete, the U.S. central bank's two rounds of asset purchases will boost GDP by about 3 percent and add about 3 million jobs by the second half of next year, San Francisco Federal Reserve Bank president John Williams said in a speech at the regional bank's headquarters. They also probably kept the United States from falling into deflation, he said.

"Of course, once the economy improves sufficiently, the Fed will need to raise interest rates to keep the economy from overheating and excessive inflation from emerging," said Williams, who has his first vote on the Fed's policy-setting committee next year.

The Fed can do so, he said, by raising the interest it pays on excess bank reserves along with its short-term interest-rate target, and by reducing its long-term securities holdings.

None of the three directly addressed Wednesday's weak data, which showed U.S. companies hired far fewer workers than expected in May. The jobs report for May is due from the Labor Department on Friday, and economists on Wednesday were cutting their forecasts for employment growth.

"Recent gains in the labor market suggest that the economy is on (a) firmer footing and that the recovery is likely to continue. However, growth may be frustratingly slow at times," Pianalto said.

Recent weak data has raised concerns that the U.S. recovery is running out of steam.

But in a response to an audience question, Pianalto said she is less worried about the recent economic soft patch because business confidence appears to be holding up better than this time last year, when the European sovereign debt crisis slowed the U.S. recovery.

"This time around, even though we are once again seeing some softness we are not seeing the same reaction on the part of businesses," she said, adding she had not heard of businesses pulling back on investments and noted they are still hiring.

At its last policy-setting meeting, the Fed signaled its $600 billion bond-buying program would end as planned in June, while also suggesting it was in no rush to raise interest rates. The Fed has kept interest rates at record lows near zero since December 2008.

Pianalto said she expects inflation to fall back below 2 percent in the next couple of years and that it could take about five years for the jobless rate to reach its long-run sustainable rate of 5.5 percent to 6 percent. She said she expects the economy to continue at a "gradual recovery pace" of just above 3 percent per year over the next few years.

Williams also said he expects growth of about 3 percent this year and sees inflation falling to 1.25 percent to 1.5 percent next year, below the Fed's informal 2 percent target.

Inflation expectations meanwhile remain "amazingly" well-anchored, both in the U.S. and Europe, despite the huge shocks of the last several years, Williams said.

That stability "gives better maneuvering room for the Fed and other central banks to combat the actual declines in economic activity and increases in unemployment," he said.

(Additional reporting by Mark Felsenthal in WASHINGTON and Ann Saphir in CHICAGO; Editing byGary Hill and Ramya Venugopal)