Submitted by Tyler Durden on 09/09/2015 - 11:32 As of Friday the comex gold "coverage" or amount of paper claims on every ounce of physical, was literally off the chart, soaring to a mindblowing 207 ounces of paper gold claims for every ounce of deliverable gold. This also means that the dilution ratio between physical gold and paper gold has hit a new all-time low of just 0.48%!
With continued volatile trading in global markets, the Godfather of newsletter writers, 91-year-old Richard Russell, discussed the serious trouble in China and the United States. The legend also discussed the Fed’s hatred of gold and their astronomical balance sheet.
Richard Russell: “China is the second biggest economy on the planet and what happens in China is therefore extremely important. China’s devaluation has put pressure on commodities. China’s leaders are obviously uncomfortable with the crash in the Chinese stock market.
Submitted by Tyler Durden on 09/09/2015 - 15:50 Forget Risk-Parity... ignore volatility-targeting... Risk management is for losers, value-investing is for dummies, and chasing momentum is for suckers... The path to successful trading in the new normal is easy... and involves just 4 simple steps...
Submitted by Tyler Durden on 09/09/2015 - 15:30 Stop. Take a deep breath…Okay, are you sitting down? What you are about to read is real — far too real.
Submitted by Tyler Durden on 09/09/2015 - 15:25 Now that Europe's migrant crisis is making international headlines on a nightly basis, France and Britain are set to use the influx of aslylum seekers as a pretext for airstrikes in Syria. The timing could not be more convenient as new "intelligence" suggests that Russia is expanding its presence in the Assad stronghold around Latakia. For its part, Germany is out warning the Kremlin against "military engagement."
Submitted by Tyler Durden on 09/09/2015 - 15:12 The growing roar of 'the establishment' crying for help from The Fed should make investors nervous. While your friendly local asset-getherer and TV-talking-head will proclaim how a rate-hike is so positive for the economy and stocks, we wonder why it is that The IMF, The World Bank, Larry Summers (twice), Goldman Sachs, China (twice), and now no lessor nobel-winner than Paul Krugman has demanded that The Fed not hike rates for fear of - generally speaking - "panic and turmoil," however, as Krugman notes, “I think it would be a terrible mistake to move. But I’m not confident that they won’t make a mistake."
Submitted by Tyler Durden on 09/09/2015 - 14:49 While it is already common knowledge that China has thrown virtually everything at the market in order to halt the ongoing market crash, including arresting "malicious sellers", journalists, and suspicious hedge fund managers, blaming HFTs for daring to sell in addition to buy, and even making trading index futures practically impossible, perhaps the most interesting revelation showcasing China's desperation came from CNBC today which reported that the government recently invited none other than Mr. ETF himself, BlackRock CEO Larry Fink to "discuss the market situation there", or said otherwise: how to manipulate the market better.
Submitted by Tyler Durden on 09/09/2015 - 14:37 If only Apple had released an iCar...
Submitted by Tyler Durden on 09/09/2015 - 14:20 Technological change often comes faster than what the people in it’s thrall can predict. It wasn’t that long ago when you and everyone else you knew were probably using AOL Instant Messenger, around the same time that dude, you were getting a Dell. Then one day you weren’t. Blackberrys used to be so popular that “to bbm” someone made it into the dictionary, but then the devices all but disappeared. These inflection points are seldom based on the companies failing their customers, but rather because consumers simply moved on.
Submitted by Tyler Durden on 09/09/2015 - 13:47 It would be a welcome gesture for an incoming government to declare the actions of previous governments to be against the interests of the taxpayers and repudiate the national debt. This would not only relieve the taxpayers of a present burden but would also mean that any future government would find it hard to borrow from international creditors forcing them to bear the negative effects of their fiscal and monetary policies much earlier and with greater severity. Unfortunately Greece’s “anti-bailout” government’s decision to ignore a plebiscite opposing a new bailout deal and the German parliament’s recent approval of said deal (going against the will of the majority of Germans) proves that any concept of democratic legitimacy is not only logically flawed but will always be discredited in practice.
Submitted by Tyler Durden on 09/09/2015 - 13:21 The Minneapolis Fed's Narayana Kocherlakota is at it again, suggesting that if Congress really cares about dragging the US economy out of the post-crisis doldrums, it will give the Fed more rope by issuing more debt.
Submitted by Tyler Durden on 09/09/2015 - 13:12 The short squeeze into 10Y auctions never fails.
Apple Slides After Unveiling iPad ProSurfaceNote, $99 iPencil, (Wi)iTV, iPhone 6S(ame), & $1100 Watch - Post MortemSubmitted by Tyler Durden on 09/09/2015 - 12:55 It's Over... so let's see what we have left... (Spoilier Alert: Mr. Cook is preparing a new email for Mr. Cramer)
Submitted by Tyler Durden on 09/09/2015 - 12:40 For the last 35 years, The Dow Industrials has found one technical level to be crucially important in knowing "when to bail on stocks." Currently that level is 15,334 - a closing break below spells significant downside... Of course, none of this matter, until it matters!
Submitted by Tyler Durden on 09/09/2015 - 12:19
Submitted by Tyler Durden on 09/09/2015 - 11:57 Bank profitability will remain under pressure for some time to come in light of the new capital regulations currently in the works. This will make it more difficult for banks to generate new capital internally, so they will have to tap the capital markets and dilute their shareholders further. It is no wonder that bank stocks remain way below the valuations they once commanded (we actually wouldn’t touch these stocks with a ten-foot pole). From a wider economic perspective, the new capital regulations are rendering banks moderately safer for depositors (as long as the markets don’t lose faith in government debt that is), but they also contribute to their ongoing “zombification”. Bank lending is going to remain subdued. This wouldn’t represent a big problem, if not for the fact that it is likely to provoke even more government activism.
Submitted by Tyler Durden on 09/09/2015 - 11:10 Over the last five years, we have developed an unhealthy obsession with the Federal Reserve, in particular, and central banks, in general, and there is plenty of blame to go around. Investors have abdicated their responsibilities for assessing growth, cash flows and value, and taken to watching the Fed and wondering what it is going to do next, as if that were the primary driver of stock prices. The Fed has happily accepted the role of market puppet master, with Federal Bank governors seeking celebrity status, and piping up about inflation, the level of stock prices and interest rate policy. We don't know what will happen at the FOMC meeting, but we hope that it announces an end to it's "interest rate magic show."
Submitted by Tyler Durden on 09/09/2015 - 11:00 If only the data - that apparently The Fed is 'dependent' on - would collapse. The surging JOLTS data has lifted September rate-hike odds - after a week of sliding - and dragged The Dow more than 200 points off its morning highs...
Submitted by Tyler Durden on 09/09/2015 - 10:48 As WSJ reports, "the European Union on Wednesday proposed redistributing 160,000 refugees across the bloc and speeding up procedures to send back those who don’t qualify for asylum, in a bid to improve a stuttering response to the largest wave of migration on the continent since the aftermath of World War II."
Submitted by Tyler Durden on 09/09/2015 - 10:32 Earlier today, all eyes were focused on Janet Yellen's favoriote Jobs indicator - the JOLTS report, and especially the total nonfarm Job Openings. And here a big problem appeared because while the Fed is now facing tremendous pressure from the outside not to hike in September, the JOLTS report not only gave a green light, but literally shrieked a rate hike in September is inevitable. The reason: the Job Openings number soared from 5.323MM to a new record high of 5.753MM, smashing expectations of a drop to 5.3MM. In fact, the monthly increase in openings of 430,000 was the highest stretching all the way back to April 2010, and was the fourth highest monthly jump in the history of the series!
Not since the Cuban Missile Crisis has the world been this close to World War III. The events are leading the superpowers to put their military assets in close proximity to each other. All that is needed is a spark. Willl Assad of Syria become the modern day Arch Duke?
The Continuing Chain of Provacative Events Leading to World War III
The chain of events are well known: China launches a sell off of it currency causing the dollar to lose value. Four chemical plants in China have been destroyed since that move.
It’s amazing how quickly cultural attitudes can change on a particular subject, sometimes for the better and sometimes for the worse. Take privacy for instance. 20 or 30 years ago, the average American would not have put up with any kind of privacy intrusion. That was something that only happened in poor despotic nations and futuristic dystopias, not in the land of free.
Now however, after the advent of the internet and cell phones, and the attacks on 9/11, most Americans have sheepishly accepted the loss of their privacy to governments and corporations. It’s become an unavoidable fact of life here in America. What would have inspired a massive public outcry just a generation ago, is now met with a shrug and a blank stare today.
Sure, you can’t eat a bar of gold and it just sits in storage like a Pet Rock that’s been cast aside by its bored owner. But try selling the Indians or Chinese a paper gold bar and see how far you get. You might end up with a knife in your forehead.
The stench has been growing stronger by the day. Many of us have been writing for years about the extreme imbalance between the paper futures open interest vs. the underlying amount of gold being reported as available for delivery. The latest disclosure from the CME is that the ratio of paper gold vs. the amount of deliverable ounces has spiked to over 200:1.
As of last Friday, JP Morgan had 89.4k ounces withdrawn from the “customer”/ eligible account in its vault and it moved 122k ounces of gold from its “deliverable”/ registered account into its customer account.
The Walking Dead
Now that Europe’s fractionally reserved banking system has been regulated into complete inertia, it is a good time to assess the current bottom line, so to speak. We should mention here that there are essentially two ways of dealing with the banking system. One is to introduce an unhampered free market banking system based on strong property rights and nothing else. Such a system would work best if it were based on sound money, i.e., a market-chosen medium of exchange. The regulations governing such a system would fit on a napkin.
A previous article explained overwhelming anti-regime opposition. Ordinary people are fed up with economic conditions creating enormous hardships – ignored to enrich privileged interests and wage war on Donbass.
Sporadic protests erupted various times before – again Monday in front of parliament violently after police stopped thousands from storming the building, led by Right Sector Nazis, likeminded Svoboda party extremists and other ultranationalist elements.
Whether last Monday’s violence signals the beginning of Maidan 2.0 remains to be seen. Elements involved include the most extremists segments of Ukrainian society – hooligan supporters of Nazi-era Stepan Bandera’s Organization of Ukrainian Nationalists (OUN-B). He collaborated in mass executions and ethnic cleansing.
Households are sitting on a £173billion debt time bomb after being lured into a spending splurge by banks and credit card companies.
An investigation by Money Mail has uncovered the startling rise in debt levels due to people splashing out on new cars, TVs, conservatories and home improvements.
But with a rise in interest rates imminent for the first time in more than eight years, fears are growing that many families will be left struggling with repayments.
The Donald trumps every major Democrat possibly running for president, according to a new nationwide poll that shows him with potentially record-breaking support among black voters.
The SurveyUSA poll showed Republican presidential candidate Donald Trump defeating Democrats Hillary Clinton, Vice President Joe Biden, Sen. Bernie Sanders, D-VT, and former Vice President Al Gore in head-to-head matchups. According to the survey:
Trump beats Clinton 45 percent – 40 percent, with an 18 point lead among seniors.
Over the last five years, we have developed an unhealthy obsession with the Federal Reserve, in particular, and central banks, in general, and there is plenty of blame to go around. Investors have abdicated their responsibilities for assessing growth, cash flows and value, and taken to watching the Fed and wondering what it is going to do next, as if that were the primary driver of stock prices. The Fed has happily accepted the role of market puppet master, with Federal Bank governors seeking celebrity status, and piping up about inflation, the level of stock prices and interest rate policy. We don’t know what will happen at the FOMC meeting, but we hope that it announces an end to it’s “interest rate magic show.”