Jim Sinclair Has Something to Say -Q&A from the May issue of Futures magazine By Daniel P. Collins
April 27, 2012 •
Jim Sinclair is not simply a gold bug; he successfully has called every major move in the precious metal — both up and down — over a generation. But he is not merely a market guru either. Sinclair has had a love affair with markets for 50 years. He has owned brokerages, clearing firms, mining companies and a precious metals dealer. His Sinclair Group of Companies, founded in 1977, offered brokerage services in stocks, bonds and commodities operating in New York, Kansas City, Toronto, Chicago, London and Geneva until he sold them in 1983. At one time he was considered the largest gold trader in the world, but today he is running his African-based Tanzanian Royalty Exploration Company and the MineSet web site that provides unique macroeconomic information to his loyal followers. Sinclair is a good person to listen to.
Futures Magazine: You have been right on gold for years. How?
Jim Sinclair: Gold has been a primary focus of mine for 50 years; I’m 71, if you put enough time into a subject you probably ought to get to know it. It became obvious to me that gold had performed extraordinarily well as a currency vs. the dollar; it performed very well in the 1980s and it performed very well on the downside. It was obvious to me that a turn was coming in 2001 and we reached a high in the U.S. currency and accordingly I felt we reached a low in gold.
FM: As opposed to some gold analysts, you have not been one a perma-bull.
JS: There was an article in The Wall Street Journal in the 1980s that said “Bull takes off his horns,” which dealt with my feeling that the gold market had maximized its price and for at least 15 years it would not be central to investor interest. I put an ad in Barron’s in 1974, which they had a hard time with but finally accepted that [stated] “Gold at $900.” My call over the past 10 years or so has been $1,650. It has gone beyond that; I put it as a minimum it would trade at in 2011. My calls in gold havd had reasons and so far have been accurate.
FM: You have done so many different things; talk about your background.
JS: I was a general partner at two New York Stock exchange firms. I have owned my own brokerage firm, clearing [members], arbitrage firm, minor metals dealer in London, and I began my sale of those when I called the top in 1980. I felt that the markets had to be approached in a different way and the things that I had done in the 1960s through 1980 weren’t applicable. I was rumored to be the largest gold trader in the world back in the ‘68 to 1980 period and that was a great compliment. Not necessarily true, but I was a significant trader and bear in mind I was a kid and I had no eraser on my pencil and didn’t believe I could be wrong. As you mature you find out you can be. Carrying the type of commitment I carried in those days right now would put me in the hospital if not the emergency ward because of the volatility of the markets. The ownership of the gold companies was simply a different way of approaching the gold market. I am a CEO and president of a public company that is involved in businesses in Tanzania, East Africa.
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My Dear Extended Family,
Do not discount this. It has the potential of being the most
important positive development in the euro since the beginning of the
USA and GB’s MSM/MOPE assault on Euroland’s problems.
This I am told is the reason behind the Euro holding above $1.30 no
matter how much the US and GB MSM/MOPE is thrown at it. This is another
economic war taking place under the radar of the Sheeplez between the USA
and GB on one side and Euroland on the other.
Russia and China might make the euro their reserve currency of
selection if Hollande can pull off this plan. I might go to France to
vote for him twice. He knows what the euro’s real problem is and will
work to cure it.
This is extremely important in the dollar equation.
It may be the most important swing factor in the political scene of
gold and the US dollar. Hollande could be the political figure of this
century for the upcoming euro block.
It is possible. Do not discount this.
Respectfully,
Jim
Jim
French Front-Runner Says He’d Seek to Renegotiate Fiscal Treaty if Elected
François Hollande said Wednesday in Paris that he would propose changes to the European Union treaty, favored by Germany. By STEVEN ERLANGER and NICHOLAS KULISH
Published: April 25, 2012
PARIS — The front-runner for the French presidency, the Socialist candidate François Hollande, said on Wednesday that if elected he would ask other European leaders to renegotiate a fiscal treaty in order to promote growth.
Mr. Hollande also praised the position taken in Brussels on Wednesday by the head of the European Central Bank, Mario Draghi, who said he favored “a growth compact” of structural reforms in parallel with the fiscal treaty limiting budget deficits and national debt.
But there was little indication that Germany, the driving force behind the austerity-driven fiscal treaty agreed to last month, was warming to his ideas.
In the first news conference of his campaign, Mr. Hollande said that he would propose four modifications to the European Union treaty, favored by Germany and approved in March but not yet ratified. Most significant, perhaps, he called for the creation of collective euro bonds, but to be used to finance industrial infrastructure projects, not to consolidate debt, which the Germans oppose.
He said he would also call for a financial transaction tax, as his rival, President Nicolas Sarkozy has done, and for loosening up regulations to allow unused European Union structural funds to be spent on growth. Finally, he urged the European Investment Bank to place a greater emphasis on job creation in its allocation of financing.
The main risk to Europe now, Mr. Hollande said, “is that the European economy remains in a recession because not enough credit is provided to companies.” He said that increased growth would help shrink debt, and that other European leaders were coming closer to his argument that increased growth is “ultimately a more effective way of reaching the same goal of controlling the debt and reducing deficits.”
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Click here to read the full article on Trader Dan Norcini’s blog…
Dear CIGAs,
This morning’s big news item was the fact that US Q1 GDP growth came in at 2.2%, well under expectations of 2.6% growth predicted by analysts and well down from Q4 2011 growth of 3.0%. Under "normal" circumstances, such a number would have been expected to put downward pressure on the bellwether copper market. ‘Twas not the case however as copper shot up on the news bursting through the 50 day moving average in the process. What gives? Simple – we are now in an environment in which the more bad news we get, the more optimistic traders are becoming that the next round of QE is coming right up.
That is what gold began sniffing out in yesterday’s session and appears to be continuing today. We have been accustomed to seeing these rotten numbers generate the risk aversion trades, trades in which commodities in general are dumped and the Dollar is bid higher. We are now seeing a change in trader perceptions, which after all is what runs markets, in which the steady trickle of news showing a deteriorating growth pattern in the US is being met with increased expectations for QE sooner rather than later.
In other words, it is QE ON instead of RISK OFF.
As long as this perception continues, gold is going to move higher. The trick is just how bad do traders think the news has to get before it forces the hands of the Fed.
I think it should be noted here that we also have politics at play as far as the Fed is concerned. Governor Romney, the presumptive Republican nominee for President, has made it clear that he is not a big fan of Chairman Bernanke. Bernanke serves at the pleasure of the current President Obama. If Obama loses the upcoming election, Bernanke is OUT AND HE KNOWS IT. Now, maybe he no longer wants to play MASTER OF THE UNIVERSE, but methinks very few men are able to gladly relinquish such power. My guess is that he is going to make sure that if his boss goes down in flames at the next election, at least it will not be on Bernanke’s account for not acting to keep the markets from sinking lower.
More…
Dear CIGAs,
This morning’s big news item was the fact that US Q1 GDP growth came in at 2.2%, well under expectations of 2.6% growth predicted by analysts and well down from Q4 2011 growth of 3.0%. Under "normal" circumstances, such a number would have been expected to put downward pressure on the bellwether copper market. ‘Twas not the case however as copper shot up on the news bursting through the 50 day moving average in the process. What gives? Simple – we are now in an environment in which the more bad news we get, the more optimistic traders are becoming that the next round of QE is coming right up.
That is what gold began sniffing out in yesterday’s session and appears to be continuing today. We have been accustomed to seeing these rotten numbers generate the risk aversion trades, trades in which commodities in general are dumped and the Dollar is bid higher. We are now seeing a change in trader perceptions, which after all is what runs markets, in which the steady trickle of news showing a deteriorating growth pattern in the US is being met with increased expectations for QE sooner rather than later.
In other words, it is QE ON instead of RISK OFF.
As long as this perception continues, gold is going to move higher. The trick is just how bad do traders think the news has to get before it forces the hands of the Fed.
I think it should be noted here that we also have politics at play as far as the Fed is concerned. Governor Romney, the presumptive Republican nominee for President, has made it clear that he is not a big fan of Chairman Bernanke. Bernanke serves at the pleasure of the current President Obama. If Obama loses the upcoming election, Bernanke is OUT AND HE KNOWS IT. Now, maybe he no longer wants to play MASTER OF THE UNIVERSE, but methinks very few men are able to gladly relinquish such power. My guess is that he is going to make sure that if his boss goes down in flames at the next election, at least it will not be on Bernanke’s account for not acting to keep the markets from sinking lower.
More…
U.S. Economic Growth Slows to 2.2% Rate, Report Says By SHAILA DEWAN
Published: April 27, 2012
The economic output of the United States grew at an annual rate of 2.2 percent in the first quarter of the year, largely on the strength of consumer spending and a surge in residential building helped by unseasonably warm weather.
The pace of growth slowed from the prior quarter’s rate of 3 percent but maintained what many economists have started to refer to as a “sustainable” recovery speed.
But as with so much economic data lately, there was plenty of forage in the gross domestic product report for both the sanguine and the skeptical. Business investment, which had been a bright spot in the previous quarter, declined, and some economists warned that consumer spending could not continue without more hiring and wage growth.
“There are mixed messages in this report,” said Dean Maki, the chief United States economist at Barclays. “None of this is going to change fundamental views on the economy.”
The United States may be lumbering, but it has not followed the euro zone, where growth halted in the fourth quarter and where the first quarter is expected to show a contraction. Britain said this week that it is already in a double-dip recession.
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Jim Sinclair’s Commentary
These are the guys running the business of government. You close a
stone loser out of control on the spot with a public execution of the
boss, like the Chinese.
Senate votes to slow closing of post offices Wed, Apr 25, 2012
WASHINGTON (AP) — The Senate offered a lifeline to the nearly bankrupt U.S. Postal Service on Wednesday, voting to give the struggling agency an $11 billion cash infusion while delaying controversial decisions on closing post offices and ending Saturday delivery.
By a 62-37 vote, senators approved a measure which had divided mostly along rural-urban lines. Over the past several weeks, the bill was modified more than a dozen times, adding new restrictions on closings and cuts to service that rural-state senators said would hurt their communities the most.
The issue now goes to the House, which has yet to consider a separate version of the bill.
"The Postal Service is an iconic American institution that still delivers 500 million pieces of mail a day and sustains 8 million jobs," said Sen. Joe Lieberman, I-Conn., a bill co-sponsor. "This legislation will change the USPS so it can stay alive throughout the 21st century."
The mail agency, however, criticized the measure, saying it fell far short in stemming financial losses. Postmaster General Patrick Donahoe said if the bill became law, he would have to return to Congress in a few years to get emergency help.
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Jim Sinclair’s Commentary
"Whatever OTC derivatives do not do to financial organization, litigation will." –Jim Sinclair, 2004
Home Owners Across the Nation Sue All Bank Servicers and Their Offshore Havens;
Spire Law Officially Announces Filing of Landmark Lawsuit
Largest International Money Laundering Network in History Formed During Obama Administration; U.S. Banks’ Theft of Home Owners’ Money Laundered Through Cayman Islands, Isle of Man and Numerous Offshore-Based Affiliates April 23, 2012, 12:01 a.m. EDT
NEW YORK, NY, Apr 23, 2012 (MARKETWIRE via COMTEX) — In a lawsuit alleged to involve the largest money laundering network in United States history, Spire Law Group, LLP — on behalf of home owners across the Country — has filed a mass tort action in the Supreme Court of New York, County of Kings. Home owners across the country have sued every major bank servicer and their subsidiaries — formed in countries known as havens for money laundering such as the Cayman Islands, the Isle of Man, Luxembourg and Malaysia — alleging that while the Obama Administration was publicly encouraging loan modifications for home owners, it was privately ratifying the formation of these shell companies in violation of the United States Patriot Act, and State and Federal law. The case further alleges that through these obscure foreign companies, Bank of America, J.P. Morgan, Wells Fargo Bank, Citibank, Citigroup, One West Bank, and numerous other federally chartered banks stole hundreds of millions of dollars of home owners’ money during the last decade and then laundered it through offshore companies. The complaint, Index No. 500827, was filed by Spire Law Group, LLP, and several of the Firm’s affiliates and partners across the United States.
Far from being ambiguous, this is a complaint that "names names." Indeed, the lawsuit identifies specific companies and the offshore countries used in this enormous money laundering scheme. Federally Chartered Banks’ theft of money and their utilization of offshore tax haven subsidiaries represent potential FDIC violations, violations of New York law, and countless other legal wrongdoings under state and federal law.
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Jim Sinclair’s Commentary
Everything required will be provided as a result of the July treaty
vote on the establishment of the "European Stability Mechanism." That
goes for everything, without limit. This plus the victory in France of
Hollande will begin a turn in events in the economic war between the US
and GB versus Euroland that has been extreme now for 3 years. Euroland
will move closer to China and Russia in the bloc formation. It will mark
the beginning of a powerful Euro bloc.
Spain Cut by S&P for 2nd Time This Year on Banks, Economy CIGA Eric
The fifth largest economy in the Euro Zone is contracting again. The IMF raised $420 billion to be thrown at Europe, including Spain, that continues to chant "we don’t need rescue fund." Lehman Brothers and Bear Sterns said the same thing in 2008. Too bad Spain simply cannot print money as a solution to its problems.
"Spain’s budget trajectory will likely deteriorate against a background of economic contraction," "At the same time, we see an increasing likelihood that Spain’s government will need to provide further fiscal support to the banking sector. As a consequence, we believe there are heightened risks that Spain’s net general govern debt could rise further."
Headline: Spain Cut by S&P for 2nd Time This Year on Banks, Economy
Concerns that Spain will have to provide further fiscal support to the banking sector as the economy contracts prompted Standard & Poor’s to cut the nation’s sovereign credit rating to BBB+ from A. Spain’s short-term rating was lowered to A-2 from A-1, while the outlook on the long-term rating is negative, New York- based S&P said in a statement yesterday. The nation’s 10-year borrowing costs have climbed about 70 basis points this year as Prime Minister Mariano Rajoy struggles to convince investors he can control public finances amid soaring unemployment and a contracting economy. Banks threaten to disrupt the premier’s efforts as bad loans reach the highest levels in almost two decades. "Spain’s budget trajectory will likely deteriorate against a background of economic contraction," S&P wrote in the statement yesterday. "At the same time, we see an increasing likelihood that Spain’s government will need to provide further fiscal support to the banking sector. As a consequence, we believe there are heightened risks that Spain’s net general govern debt could rise further." This is the second downgrade of Spain by S&P this year. The firm cut Spain along with France and other European nations on Jan. 13. Since then, the yield on Spain’s 10-year bonds have risen to 5.83 percent from 5.22 percent, while borrowing costs for France are little changed at 2.98 percent. Spain’s yields are up from about 4.13 percent in January 2009, when S&P stripped it of its top AAA rating.
Source: finance.yahoo.com
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A Trend Is More Important Than A Single Data Point CIGA Eric
Yesterday’s durable good report revealed that real business core spending slowed to 1.2% year-over-year (yoy). This annual gain, the slowest reading since March 2010, represents a continuation of an up trend deceleration that began in August 2010. The last time real business core spending turned into negative was January 2007. Several months of negative chop and slow trend deterioration preceded the onset of 2008 crisis.
Chart: Real Business Core Capital Spending: Real or CPI-Adjusted New Orders of Durable Goods ex. defense and aircraft (RBCCS) and YOY Change
![clip_image002[1]](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhDu1Ky4SDgCpT1UUn3B-e9WEHlspBsqcRUzR1llSZhyD2cSzkwqYgXjv92TVFGz-KRzCEKdsqJo4FLTmNL6aEVwvg_A1iBM5oCV_ZbDfO_85RHfkjmFIxIOCMiJeLneZKrULQYE3dn7MVf/s1600/RBCCS.PNG "clip_image002[1]")
Headline: Plunge in durable goods orders clouds U.S. outlook
WASHINGTON (Reuters) – Demand for long-lasting U.S. manufactured goods tumbled by the most in three years in March and businesses cut back on spending plans, suggesting the economy slowed as the first quarter drew to a close. Durable goods orders dropped 4.2 percent, the largest decline since January 2009 when the economy was nose-diving, Commerce Department data showed on Wednesday. Economists had expected a drop of just 1.7 percent. February orders were revised to show only a 1.9 percent increase instead of the previously reported 2.4 percent rise. "This adds to the evidence that momentum in the economy sort of fell flat in March," said Ellen Zentner, a senior U.S. economist at Nomura Securities in New York. Data on durable goods, items ranging from toasters to aircraft that are meant to last three years or more, is notoriously volatile, and investors on Wall Street shrugged off the report. The data was the latest to show the factory sector losing a step in March and reinforced the Federal Reserve’s view of moderate growth over the coming quarters. Fed policymakers, in a statement at the end of their two-day meeting on Wednesday, reiterated they see modest growth, but also said they expect economic growth "to pick up gradually."
Source: finance.yahoo.com
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Dear Jim,
Tuesday April 24 2012 Day 1
I was up at 6:00 AM to start my trip. In Detroit it was a little strange. The airline checked our tickets and passports before allowing us to pass the gate as normal. But after we were on the walk way they had government agents checking for money. They informed us about the 10,000 Dollar Declaration Rule and wanted to know if we wanted to declare money and how much money we had. Then they wanted to see it and search your carry-on in some cases. In thirty years this is the first time that I have seen them check people leaving the country.
Be prepared the next time you go to Tanzanian,
CIGA Ron C.
Dear Ron,
Maybe you were the only one other than me that boards a plane in America with a suit and tie on?
Regards,
Jim
Economy in U.S. Grew Less Than Forecast in First Quarter CIGA Eric
While it’s certain some will be screaming – the consumer is back, don’t let their hype blind you to the truth that the US economy remains dangerously unbalanced. Personal consumption expenditures (spending) sacrifices future (investment) for present (consumption) growth. As of Q1 2012, spending as a percentage of GDP has reached an all-time high of 71.25%. What percentage raises concerns with our economic leaders? 75, 80, how about 100%?
A sharp drop in the savings rate has been fueling the recent round of consumption. Savings as a percentage of GDP has fallen to 3.0% in Q1 2012. This percentage represents a sharp decline late 2008 crisis highs of 4.8% (see chart 2). Who needs savings or private investment when the government will take care of that.
It doesn’t make me proud to say it, but a world of financial hurt is heading towards a still largely unprepared public.
Chart 1:
Chart 2:
Headline: Economy in U.S. Grew Less Than Forecast in First Quarter
The U.S. economy expanded less than forecast in the first quarter as the biggest gain in consumer spending in more than a year failed to overcome a diminished contribution from business inventories. Gross domestic product, the value of all goods and services produced in the U.S., rose at a 2.2 percent annual rate after a 3 percent pace, Commerce Department figures showed today in Washington. The median forecast of economists surveyed by Bloomberg News called for a 2.5 percent rise. Household purchases increased 2.9 percent, exceeding the most optimistic projection. Homebuilding grew the fastest in almost two years.
Source: bloomberg.com
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Dear Jim,
Great article/interview with Futures Magazine. One question:
“FM: Is that still viable?
JS: It is not viable because of the environment. Every tool known to mankind would be used to prevent that from happening.”
Did you mean that gold will not be able to reach $12,000+ /oz because of the interventions/manipulations?
If so, at what price will gold potentially peak at in the final upswing in your opinion?
Best regards
CIGA Clive
Clive,
I did not say that it could be prevented if it starts. When Gold goes over $2111 for 3 days it has started.
Jim
The Battle Between Paper Supply and Physical Demand Intensifying CIGA Eric
I would like to share a brief exchange I had yesterday with Jim.
JIM: The COMEX will violate their contract before they allow a squeeze. That is CERTAIN
ERIC: Isn’t that tantamount to saying there’s no way we can delivery on any of the outstanding contracts? Sounds like John Law shell game to me.
JIM: Be assured. it will happen.
ERIC: I have no doubt.
The third count turned green (bullish) before the recent bounce. GLD as a tool of control is just another conduit of supply driven by the paper exchanges.
Chart: London PM Fixed Gold and GLD (ETF) Total Assets WA Stochastic
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Postal Service bill faces roadblocks CIGA Eric
Delay and rescue is inevitable as austerity is the driving force behind changes in leadership.
Headline: Postal Service bill faces roadblocks
WASHINGTON (CNNMoney) — A Senate bill passed this week to rescue the indebted U.S. Postal Service is drawing fire from key agency officials and House Republican leaders. And it’s looking increasingly unlikely that the House and Senate will agree on a plan to save the Postal Service by May 15, when a moratorium on closing postal processing plants expires. The Postal Service Board of Governors, the panel that runs the service, issued a statement late Wednesday, saying the Senate bill "falls short" and "would not enable the Postal Service to return to financial viability." The Senate bill passed Wednesday night. Rep. Darrell Issa of California, who has authored a House plan to save the Postal Service, called the Senate bill "wholly unacceptable." Aides say Republican leaders don’t feel pressured to take up the House bill right away, because they’re not worried about postal closures. In fact, the House legislation paves the way for more closures, as well as the end of Saturday service.
Source: money.cnn.com
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US Companies Are Furiously Creating Jobs... Abroad
Whatever
one thinks of the practical implications of the Kalecki equation (and
as we pointed out a month ago, GMO's James Montier sure doesn't think much
particularly when one accounts for the ever critical issue of asset
depreciation), it intuitively has one important implication: every incremental dollar of debt created at the public level during a time of stagnant growth (such as Q1 2012 as already shown earlier) should offset one dollar of deleveraging in the private sector.
In turn, this should facilitate the growth of private America so it
can eventually take back the reins of debt creation back from the
public sector (and ostensibly help it delever, although that would mean
running a surplus - something America has done only once in the
post-war period). This growth would manifest itself directly by the
hiring of Americans by US corporations, small, medium and large, who in
turn, courtesy of their newly found job safety, would proceed to
spend, and slowly but surely restart the frozen velocity of money which
would then spur inflation, growth, public sector deleveraging, and all
those other things we learn about in Econ 101. All of the above
works... in theory. In practice, not so much. Because as the WSJ
demonstrates, in the period 2009-2011, America's largest
multinational companies: those who benefit the most from the public
sector increasing its debt/GDP to the most since WWII, or just over
100% and rapidly rising, and thus those who should return the favor by
hiring American workers, have instead hired three times as many
foreigners as they have hired US workers. Those among us cynically inclined could say, correctly,
that the US is incurring record levels of leverage to fund foreign
leverage, foreign employment, and, most importantly, foreign leverage.Richard Koo On The Three Problems With Bullish Speculation On Europe
The
balance sheet recession diagnosis of many of the world's developed
nations remains among the clearest explanation linking the failure of
textbook Keynesian monetary policy to the dismal multipliers and sad
reality of a recovery-less recovery. Whether you agree with Richard
Koo's traditional but massive fiscal stimulus medicinal choice is a
different matter but the Nomura economist delineates the three
problems (two macroeconomic and one capital flow) exacerbating the
eurozone crisis and notes that "bulls have gotten ahead of themselves".
Noting that the central bank supply of funds may help address
financial crises but cannot resolve problems at borrowers, and that
authorities have never admitted they were wrong, Koo stresses the three key reasons that bullish speculation on eurozone is premature
- monetary accommodation's ineffectiveness when the private sector is
deleveraging, active fiscal retrenchment by the core when fiscal
stimulus is the only plus for aggregate demand, and Japanese and US
lagged-examples of that dash any short-term hope that structural reforms
will lead to growth. Even his solution to the European debacle - one
of financial repression limiting the sale of government bonds to each nation's own citizens
- while retroactively limiting a nation's largesse seems to only lead
to the inevitable Japanification we have discussed at length. In the
meantime, Koo appears far less sanguine than the markets about the
prospects for anything but further demise in Europe (and the US).Jim Quinn Explains Why We've Never Left The Recession
It is three and a half years since the Great Recession hit in 2008 with the collapse of our financial system caused by the Wall Street banks and their captured politician cronies in Washington D.C. Their mouthpieces in the mainstream media have been telling the American sheeple that we have been out of recession and in recovery since the 4th quarter of 2009. It truly has been a recovery for the Wall Street bankers and the mega-corporations that have laid off millions and opened new factories in the Far East while generating record profits and rewarding their executives with millions in bonuses. The stock market has doubled from its 2009 lows. All is well on Wall Street – not so much on Main Street. The compliant non-questioning MSM reported that GDP in the 1st quarter rose 2.2%, less than expected. This pitiful government manipulated result confirms that we are back in recession. The first quarter had the huge benefit of fantastic weather, an extra day, and a supposed surge in jobs. And this is all we got? Take a good long hard look at this chart.
Europe Ends Week Green But Notably Red On Month
For
the third week in a row, European equity and credit markets have
remained range-bound. Equities broadly ended the week in the green with
the BE500 (Bloomberg's broad S&P 500-equivalent for Europe) ending
near the top of the recent range - around the pre-NFP levels from 4/5.
Spain and Italy have seen improvements this week in their equity indices
but they remain down notably on the month and perhaps surprisingly
only the UK's FTSE 100 is in the green for the month. Credit is considerably more dispersed but also green close-to-close on the week
after a strong finish today (as the dismal data started rumors of more
ECB easing and QE3 lifts). Stocks and high-beta crossover credit
outperformed in the liquidity rush but subordinated financials lagged on
the week. Critically though, while anchoring bias might make
us all feel joyous in the last few days of recovery, we remain
significantly red on the month across all risk asset classes in Europe.
Sovereigns followed the same path as equities and credit - with another
range-bound rotation up better on bill auction success and worse on
bond auction failure but as with equities/credit today's exuberance
lifted them to the middle of the recent range - well off the best levels
of the last few weeks. Most notably, Spanish and Italian 10Y
bond spreads are over 60bps wider in April and continue to trade in a
two-steps-wider-one-step-tighter rotation intra-week. Portugal
is the big winner on the week (and month) when it comes to bond spreads
- which are now back to mid-September levels. However - as we have
tried to explain before - the massive cheapness of Portuguese bonds
relative to CDS (the so-called basis) has just been too tempting and
grabbing this 'risk-free' carry has provided some bid to a notably
illiquid Portuguese bond market and crushed the differential between
bonds and CDS. The point being - be careful in reading too much
into Portuguese bond improvements as it is much more a technical
arbitrage move than real money flowing into this restructuring prone nation. 
Lately, gold has been a disappointment to many investors while it has been mostly treading water. Gold has traded well beneath its all-time high of $1,924 an ounce on September 6th and well above its subsequent low near $1,520 which took place in late December. Many anticipated higher prices this year, but the year isn’t over yet, and neither is gold’s long-term spectacular, secular bull market. We are now in one of those periods of consolidation that tries the souls of gold investors, tests their resolve and challenges their staying power. This is when the market takes a breather and adjusts to prepare for the next major move.
If you need some encouraging news, according to the latest IMF statistics, at least 12 countries are known to have increased their gold reserves in March continuing a trend that goes back more than two years. Overall Central Banks appear to have purchased about 58 tons in the month, which suggests acceleration in their gold accumulation.
Read More @ GoldSeek.com
There is no question that the policies of the U.S. Federal Reserve Bank, specifically its role in shaping monetary policy, have a big impact on precious metal markets.
The Fed sets short-term interest rates, whereas long-term rates are pegged to the 10-year Treasury bond, which is a function of how much premium bond buyers demand for investing in a supposedly safe government asset instead of riskier ones.
Since the start of the financial crisis in 2008, however, the Fed’s actions, meetings, and words have had an unusually large impact on precious metal prices.
Those markets seem to hang on every word that Chairman Ben Bernanke utters, and every interview or statement on interest rates or the economy that a Fed governor gives. It’s as if Bernanke were the Oracle of Delphi.
Read More @ CoinWeek.com
by Frank Tang and Jan Harvey, Reuters:
Bullion buying accelerated after a report showed U.S. economic growth cooled in the first quarter as businesses cut back on investment. Some safe-haven buying also supported gold after a credit downgrade of Spain’s sovereign debt by Standard & Poor’s.
Gold’s four-day rise was boosted by option-related buying and after Federal Reserve Chairman Ben Bernanke said on Wednesday the U.S. central bank would not hesitate to launch another round of bond purchases to boost growth if necessary.
Read More @ Reuters.com
by Lawrence Williams, MineWeb.com
Lawrence Williams – Goldman Sachs sees the U.S. economy slipping back, a return of QE and higher gold prices up to its previous target of $1840 an ounce this year. CITIFx would seem to concur and looks to $2400 gold!
In its latest Commodity Watch, Goldman Sachs’ commodities analysis team in New York, London and Shanghai remains cautious on the commodity complex as a whole but does admit to liking the prospects for gold. However it does emphasize that its views are based “not on improving fundamentals, but rather on relative value” as the bank sees the U.S. economy slowing again this quarter and expects gold to converge to real interest rates.
In its commentary on the overall commodities situation, Goldman notes that the recent commodity price decline does open up prospects of a possible rise across the board to its near-term price targets, but that it actually remains neutral on most as it feels downside risks remain high in the short term. It cites renewed European sovereign debt concerns and a modest slowing in U.S. growth patterns as its principal reasons for caution but does note that the situation could change for the better given signs that Chinese growth looks again likely to pick up after the government initiated slowdown of last year.
Read More @ MineWeb.com
Lawrence Williams – Goldman Sachs sees the U.S. economy slipping back, a return of QE and higher gold prices up to its previous target of $1840 an ounce this year. CITIFx would seem to concur and looks to $2400 gold!
In its latest Commodity Watch, Goldman Sachs’ commodities analysis team in New York, London and Shanghai remains cautious on the commodity complex as a whole but does admit to liking the prospects for gold. However it does emphasize that its views are based “not on improving fundamentals, but rather on relative value” as the bank sees the U.S. economy slowing again this quarter and expects gold to converge to real interest rates.
In its commentary on the overall commodities situation, Goldman notes that the recent commodity price decline does open up prospects of a possible rise across the board to its near-term price targets, but that it actually remains neutral on most as it feels downside risks remain high in the short term. It cites renewed European sovereign debt concerns and a modest slowing in U.S. growth patterns as its principal reasons for caution but does note that the situation could change for the better given signs that Chinese growth looks again likely to pick up after the government initiated slowdown of last year.
Read More @ MineWeb.com
[Ed. Note: 
They used YOUR money to bail themselves out. Then they built new
plants in China, in order to build their cars in China. It's all part of
the new fascist version of freedom in Amerika. The picture on the left
shows what globalization and "free trade" has done to Detroit. Sadly, it
has all been done by design by the international Corporations and the
corrupt Oligarchs who run this country.]
from Insideline.com:
BEIJING — Cadillac said it will begin building its new XTS flagship sedan this fall in China, just months after the car’s North American launch. The China-market XTS will be assembled by the Shanghai General Motors joint venture.
The move is intended by Cadillac to capitalize on the brand’s surging
popularity in China, especially among younger, more affluent buyers.
Cadillac, which entered the Chinese market in 2005, sold a record 30,000 vehicles there in 2011, compared with 17,000 in 2010. Cadillac sales in March also set a record of 2,745 units, up more than 35 from the previous year. Cadillac’s top seller in China is the SRX crossover, which is assembled in Mexico.
The brand’s marketing boss Don Butler said, “China is the second-largest market for Cadillac, and of course is one of the largest and strongest markets in the world for luxury cars, so it is a core part of our vision as a brand.”
Read More @ Insideline.com
They used YOUR money to bail themselves out. Then they built new
plants in China, in order to build their cars in China. It's all part of
the new fascist version of freedom in Amerika. The picture on the left
shows what globalization and "free trade" has done to Detroit. Sadly, it
has all been done by design by the international Corporations and the
corrupt Oligarchs who run this country.]from Insideline.com:
BEIJING — Cadillac said it will begin building its new XTS flagship sedan this fall in China, just months after the car’s North American launch. The China-market XTS will be assembled by the Shanghai General Motors joint venture.
The move is intended by Cadillac to capitalize on the brand’s surging
popularity in China, especially among younger, more affluent buyers.Cadillac, which entered the Chinese market in 2005, sold a record 30,000 vehicles there in 2011, compared with 17,000 in 2010. Cadillac sales in March also set a record of 2,745 units, up more than 35 from the previous year. Cadillac’s top seller in China is the SRX crossover, which is assembled in Mexico.
The brand’s marketing boss Don Butler said, “China is the second-largest market for Cadillac, and of course is one of the largest and strongest markets in the world for luxury cars, so it is a core part of our vision as a brand.”
Read More @ Insideline.com
by Jason Hommel, SilverStockReport.com
Buying silver and gold today will likely be better than buying
Microsoft or Apple stock way back when they first came out, and this
article addresses the fundamental reasons why.
People often ask, “What good is silver or gold if I can’t spend it?”
But that’s exactly why we all should buy it! Low monetary demand means silver and gold are still cheap and undervalued liquid assets that investors should crave.
And crave it, they do. But 99% of silver investors are duped into buying the wrong kind of “silver”, the kind that is not silver at all.
“Investors” have “bought” up to 200 billion “dollars” worth of “silver” in “accounts”, which would be 15-20 years of annual mine supply. Clearly, that silver was never bought by the “brokers” who “sold” that much “silver” in “accounts” to “investors”.
Read More @ SilverStockReport.com
Buying silver and gold today will likely be better than buying
Microsoft or Apple stock way back when they first came out, and this
article addresses the fundamental reasons why.People often ask, “What good is silver or gold if I can’t spend it?”
But that’s exactly why we all should buy it! Low monetary demand means silver and gold are still cheap and undervalued liquid assets that investors should crave.
And crave it, they do. But 99% of silver investors are duped into buying the wrong kind of “silver”, the kind that is not silver at all.
“Investors” have “bought” up to 200 billion “dollars” worth of “silver” in “accounts”, which would be 15-20 years of annual mine supply. Clearly, that silver was never bought by the “brokers” who “sold” that much “silver” in “accounts” to “investors”.
Read More @ SilverStockReport.com
from The Economic Collapse Blog:
about 2 million
today. That doesn’t mean that there is less farming going on. U.S.
farms are producing more than ever. But what it does mean is that
farming is increasingly becoming dominated by the big boys. The rules
of the game have been tilted in favor of big agribusiness so
dramatically that most small farmers find that they simply cannot
compete anymore. Back in 1900, about 39 percent of the U.S. population
worked on farms. At this point, only about 2 percent
of all Americans now live on farms. Big agribusiness, the food
processing conglomerates, and big seed companies such as Monsanto
completely dominate the industry. Unless something dramatic is done,
the family farm is going to continue to be wiped out of existence.
Unfortunately, it does not look like things are going to turn around any
time soon.
Read More @ TheEconomicCollapseBlog.com
about 2 million
today. That doesn’t mean that there is less farming going on. U.S.
farms are producing more than ever. But what it does mean is that
farming is increasingly becoming dominated by the big boys. The rules
of the game have been tilted in favor of big agribusiness so
dramatically that most small farmers find that they simply cannot
compete anymore. Back in 1900, about 39 percent of the U.S. population
worked on farms. At this point, only about 2 percent
of all Americans now live on farms. Big agribusiness, the food
processing conglomerates, and big seed companies such as Monsanto
completely dominate the industry. Unless something dramatic is done,
the family farm is going to continue to be wiped out of existence.
Unfortunately, it does not look like things are going to turn around any
time soon.Read More @ TheEconomicCollapseBlog.com
“History does not repeat itself, but it sure does rhyme.“ (Mark Twain)
by Stephan Bogner, Silver Seek:
Between 1970 and 1979, the silver price was increasing steadily from
$1.50 to $6, before taking off in September 1979 from $10 to $50 within 5
months. During that bull cycle, demand for silver did not increase but
actually declined (sharply in 1979). It was as late as 1983 when demand
increased confidently from 12,000 to 27,000 tons per year until 2000 –
yet the silver price was in a 20 year bear market during that time. In
2003, when silver started its new bull market, the demand actually
dropped to 23,000 tons until 2005 – during which 2 years silver almost
doubled from $4.50 to $8. Since 2005, demand is rising stronger than
ever, having reached 33,000 tons in 2010, whereas the silver price is
rising strongly as well.
Read More @ SilverSeek.com
by Stephan Bogner, Silver Seek:
Between 1970 and 1979, the silver price was increasing steadily from
$1.50 to $6, before taking off in September 1979 from $10 to $50 within 5
months. During that bull cycle, demand for silver did not increase but
actually declined (sharply in 1979). It was as late as 1983 when demand
increased confidently from 12,000 to 27,000 tons per year until 2000 –
yet the silver price was in a 20 year bear market during that time. In
2003, when silver started its new bull market, the demand actually
dropped to 23,000 tons until 2005 – during which 2 years silver almost
doubled from $4.50 to $8. Since 2005, demand is rising stronger than
ever, having reached 33,000 tons in 2010, whereas the silver price is
rising strongly as well.Read More @ SilverSeek.com
by Ethan A. Huff, Natural News:
For civilization to persist, each subsequent generation must be
equipped by the previous one with the knowledge and skills to grow food,
which traditionally occurs on family-scale farms from parent to child,
or from seasoned expert to young amateur. But new labor laws being
proposed by the U.S. Department of Labor (DoL) would prohibit
children from performing many of the routine farm chores they have been
involved with for centuries, which some see as a direct attack on
small-scale agriculture.
The Daily Caller reports that the DoL, under the guidance of the Obama Administration, is proposing that child labor laws be modified to prohibit children under the age of 16 from working with animals, for instance, or from being allowed to work with food storage bins. The proposal also seeks to prohibit children from “being employed in the storing, marketing and transporting of farm product raw materials,” which essentially makes it a crime for farmhands to touch produce once it has been picked.
Read More @ NaturalNews.com
For civilization to persist, each subsequent generation must be
equipped by the previous one with the knowledge and skills to grow food,
which traditionally occurs on family-scale farms from parent to child,
or from seasoned expert to young amateur. But new labor laws being
proposed by the U.S. Department of Labor (DoL) would prohibit
children from performing many of the routine farm chores they have been
involved with for centuries, which some see as a direct attack on
small-scale agriculture.The Daily Caller reports that the DoL, under the guidance of the Obama Administration, is proposing that child labor laws be modified to prohibit children under the age of 16 from working with animals, for instance, or from being allowed to work with food storage bins. The proposal also seeks to prohibit children from “being employed in the storing, marketing and transporting of farm product raw materials,” which essentially makes it a crime for farmhands to touch produce once it has been picked.
Read More @ NaturalNews.com
by Joel F. Wade, The Daily Bell:
German-Jewish
(and eventually naturalized American) philosopher Hannah Arendt
(1906-1975) outraged the Left with her definitive account of modern
tyranny, The Origins of Totalitarianism.
Written in 1951 when Stalin was still ruling the Soviet Union and worshipped by the Left, it exposed with ruthless logic and evidence the essential sameness between Nazi Germany and Soviet Russia. Nazism and Communism were just two sides of the same tyrannical coin, said Arendt, not opposites of Right and Left.
The world’s leftist intellectuals never forgave her, and so were scandalized again in 1963 by her book, On Revolution, an impeccably scholarly study of why the American Revolution was a success and the French Revolution an abysmal failure.
Read More @ TheDailyBell.com
by Mark Deen and Helene Fouquet , Bloomberg :
Francois Hollande’s stepped-up attacks on Chancellor Angela Merkel’s belt-tightening solution to Europe’s crisis show he doesn’t understand his country’s economic shortcomings, an aide to the German leader said.
The intensifying war of words between the French presidential race frontrunner and Merkel is putting the two politicians from Europe’s two largest economies on a collision course over ending the region’s sovereign debt crisis.
“It’s not for Germany to decide for the rest of Europe,” Hollande said late yesterday on France 2 television, prompting Michael Meister, the deputy caucus chairman of Merkel’s Christian Democrats, to say in a phone interview today that “Herr Hollande has misunderstood the problems in his country and in other euro area countries.”
Related interview from Bloomberg:
Pierre-Yves Gauthier, head of strategy at AlphaValue SAS, talks about French Socialist presidential frontrunner Francois Hollande’s pledge to block corporate job cuts. He spoke April 19 with Bloomberg Television’s Caroline Connan in Paris.
Click here to watch interview
Read More @ Bloomberg.com
by Tim Reid, Reuters:
More than 1 million Americans who have taken out mortgages in the past two years now owe more on their loans than their homes are worth, and Federal Housing Administration loans that require only a tiny down payment are partly to blame.
That figure, provided to Reuters by tracking firm CoreLogic, represents about one out of 10 home loans made during that period.
It is a sobering indication the U.S. housing market remains deeply troubled, with home values still falling in many parts of the country, and raises the question of whether low-down payment loans backed by the FHA are putting another generation of buyers at risk.
Read More @ Reuters.com
German-Jewish
(and eventually naturalized American) philosopher Hannah Arendt
(1906-1975) outraged the Left with her definitive account of modern
tyranny, The Origins of Totalitarianism.Written in 1951 when Stalin was still ruling the Soviet Union and worshipped by the Left, it exposed with ruthless logic and evidence the essential sameness between Nazi Germany and Soviet Russia. Nazism and Communism were just two sides of the same tyrannical coin, said Arendt, not opposites of Right and Left.
The world’s leftist intellectuals never forgave her, and so were scandalized again in 1963 by her book, On Revolution, an impeccably scholarly study of why the American Revolution was a success and the French Revolution an abysmal failure.
Read More @ TheDailyBell.com
Francois Hollande’s stepped-up attacks on Chancellor Angela Merkel’s belt-tightening solution to Europe’s crisis show he doesn’t understand his country’s economic shortcomings, an aide to the German leader said. The intensifying war of words between the French presidential race frontrunner and Merkel is putting the two politicians from Europe’s two largest economies on a collision course over ending the region’s sovereign debt crisis.
“It’s not for Germany to decide for the rest of Europe,” Hollande said late yesterday on France 2 television, prompting Michael Meister, the deputy caucus chairman of Merkel’s Christian Democrats, to say in a phone interview today that “Herr Hollande has misunderstood the problems in his country and in other euro area countries.”
Related interview from Bloomberg:
Pierre-Yves Gauthier, head of strategy at AlphaValue SAS, talks about French Socialist presidential frontrunner Francois Hollande’s pledge to block corporate job cuts. He spoke April 19 with Bloomberg Television’s Caroline Connan in Paris.
Click here to watch interview
Read More @ Bloomberg.com
More than 1 million Americans who have taken out mortgages in the past two years now owe more on their loans than their homes are worth, and Federal Housing Administration loans that require only a tiny down payment are partly to blame.
That figure, provided to Reuters by tracking firm CoreLogic, represents about one out of 10 home loans made during that period.
It is a sobering indication the U.S. housing market remains deeply troubled, with home values still falling in many parts of the country, and raises the question of whether low-down payment loans backed by the FHA are putting another generation of buyers at risk.
Read More @ Reuters.com
from Azizonomics:
Way back in 2009, I remember fielding all manner of questions from people wanting to invest in gold, having seen it spike from its turn-of-the-millennium slump, and worried about the state of the wider financial economy.
A whole swathe of those were from people wanting to invest in exchange traded funds (ETFs). I always and without exception slammed the notion of a gold ETF as being outstandingly awful, and solely for investors who didn’t really understand the modern case for gold — those who believed that gold was a “commodity” with the potential to “do well” in the coming years. People who wanted to push dollars in, and get more dollars out some years later.
2009 was the year when gold ETFs really broke into the mass consciousness:
Read More @ Azizonomics.com
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Way back in 2009, I remember fielding all manner of questions from people wanting to invest in gold, having seen it spike from its turn-of-the-millennium slump, and worried about the state of the wider financial economy.
A whole swathe of those were from people wanting to invest in exchange traded funds (ETFs). I always and without exception slammed the notion of a gold ETF as being outstandingly awful, and solely for investors who didn’t really understand the modern case for gold — those who believed that gold was a “commodity” with the potential to “do well” in the coming years. People who wanted to push dollars in, and get more dollars out some years later.
2009 was the year when gold ETFs really broke into the mass consciousness:
Read More @ Azizonomics.com
![[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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