Could Not Be Clearer...
A few days ago we warned, confirming Goldman Sachs' earlier analysis that the world was running out of space to store crude distillate products, that China was running out of storage space for crude oil as it dramatically ramped up its Strategic Petroleum Reserve 'buy low' plan. While the brightest indicator at the time was "about 4 million barrels of crude oil stranded in two tankers off an eastern port for nearly two months," this week, the dial went to 11 on the oil-demand-fear-o-meter, as Bloomberg reports supertankers sailing to Chinese ports plunged to its lowest in 13 months, sending the daily rate for shipping crashing. The marginal demand-er of last resort just left the market.
"The conditions in the economies of the rest of the world have undoubtedly proved weaker compared with a few months ago, in particular in the emerging economies. Global growth forecasts have been revised downwards. This slowdown is probably not temporary."
Another strong week for gold demand at the Shanghai Gold Exchange – China’s main physical gold bourse. From 19 until 23 October 57 tonnes have been withdrawn from the vaults of the Shanghai Gold Exchange (SGE), according to data released on Friday by the SGE. Year to date 2,119 tonnes have been withdrawn. With a little over two months left in 2015 SGE withdrawals, which capture the amount of Chinese wholesale gold demand, are set to reach more than 2,500 tonnes in 2015, breaking the record of 2013 at 2,197 tonnes.
SGE withdrawals have made a spectacular run up this year since the Chinese stock market came crumbling down in June. In between June and October SGE withdrawals have been 1,138 tonnes, up 37 % year on year.
The People’s Republic of China does not publish the amount of gold imported, however, from foreign trade statistics provided by other nations and physical turnover at the SGE we can estimate China will net import at least 1,300 tonnes of gold in 2015 – transcending net import in 2014, which was an estimated 1,250 tonnes.
– Gold down 1.3% this week on Fed “noise”
– Gold up 3% in October on robust demand
– Stronger gains in euros, Swiss francs, Japanese yen
– October poor month for gold seasonally
– November, December, January and February the “seasonal sweet spot”
– Confirmation of surging demand for bullion in Germany, India and China in Q3
Gold is headed for a 1.3% fall this week after the Fed’s latest suggestion that they may increase interest rates in December or in the New Year. However, for the month of October gold is 3.1% higher from $1,115/oz to $1,150/oz and has seen even larger gains in other currencies.
Submitted by Tyler Durden on 10/31/2015 - 18:05 The only way that the Fed and the politicians can claim that the economy is “fine” and QE “worked” is to make sure that the one piece of obvious evidence which would say otherwise is kept highly restrained. The manipulation of the gold and silver market is a nothing but a product of complete systemic corruption.
Part I of this series began to address a seeming paradox. As explained and defined in that initial installment; by mathematical/economic definition, the Federal Reserve has already hyperinflated the U.S. dollar – past tense. Yet the consequence of that hyperinflation of the money supply (spiraling prices/a plunge to worthlessness for the USD) has yet to materialize.
It was explained that one part of this paradox is the historic lag in time which has been observed, between when a currency becomes fundamentally worthless from a monetary standpoint, and the time the currency sees its actual exchange-rate plunge to zero. This is the “confidence gap”: the length of time in which the Chumps can continue to be deluded into using this worthless currency, and continue to assign it value.
Submitted by Tyler Durden on 10/31/2015 - 17:00 It was 77 years ago this week that Orson Welles struck terror into the hearts of Americans with his live radio broadcast of the HG Wells classic War of the Worlds. What struck me while watching the PBS retrospective were the similarities between then and now. The gullibility of the masses, the power of fear, the overreaction by the media, busy bodies calling for the government to do something, and the effectiveness of propaganda are all commonalities between that Fourth Turning and today’s Fourth Turning.
They should add to this that... one day you will die fighting for them and we will cheer...Waving the Red White and Blue...chanting Murica...Murica...Murica...
Submitted by Tyler Durden on 10/31/2015 - 14:35 Today we got yet another tortured admission of just how ugly Greek balance sheets are, the ECB has admitted what we knew months ago, namely that more than half of all Greek loans are now nonperforming, and that as much as 57% of the loans made by Piraeus Bank the bank which fared worst, are at risk with the other Greek banks not much better off.
Have you noticed the passport wars are heating up? I have.
For instance, numerous outlets have now reported on Britain’s “Harsh New Anti-Terror Laws.” While the laws deal with a number of anti-terror activities, including shutting down mosques and punishing media outlets that disseminate “terrorist” rhetoric, a notable element involves the suspension of passports.
Among other things, as Reuters recently reported, “The new law would … give parents worried that their 16- and 17-year-old children might travel to join Islamic State the power to apply to have their passports removed, while anyone with a conviction for terrorist offences or extremist activity would be banned from working with children.”
Britain is not alone in using the passport system as a method of attacking those who for one reason or another are deemed “enemies of the state” – or potential enemies. The US is doing its best as well.
by Christina Sarich, Natural Society:
A Monsanto research site in France was enveloped recently in heavy flames due to a possible arson attack against the company. Two areas dedicated to maize research caught fire with the smell of petrol lingering in nearby hallways and throughout other areas of Monsanto’s building site.
Jakob Witten, an official spokesperson for the company told police that the company suspects arson because no electrical damage was found.
The Money GPS:
Few could have envisioned it even just a few years ago, but it’s happening now, and on an ever-widening scale. More big U.S. banks are shunning cash, because the banking system has become so dependent on other “assets” that large cash deposits actually pose a threat to their financial health, according to The Wall Street Journal.
State Street Corporation, a Boston-based institution that manages assets for institutional investors, has, for the first time, begun charging some customers for making large cash deposits, according to people familiar with the development.
And the largest U.S. bank in terms of assets — JP Morgan Chase & Co. — has dramatically cut “unwanted” deposits to the tune of $150 billion this year alone, in part by charging customers fees.
What gives? What kind of world do we live in when banks no longer want cash?
Submitted by Tyler Durden on 10/31/2015 - 19:50 It appears that Washington, ever a seething cauldron of bright ideas, is looking for a shooting war with China, or perhaps trying to make the Chinese kowtow and back down, the pretext being some rocks in the Pacific in which the United States cannot possibly have a vital national interest. Or, really, any interest. If Washington somehow won a naval war with China, so what? It would provide the satisfactions of vanity, but China’s danger to the US imperium lies in increasing economic power and commercial expansion through Asia, where it holds the high cards: it is there, Washington isn’t.
My first public market call in the metals complex was made back in 2011, at which time I was looking for a top in the gold market at $1,915. While it came quite close to the actual top struck in the market ($1,921), many thought me to be less than credible in publishing such an article when the rest of the market was so certain that we would exceed $2,000 imminently.
But, what was not written that article was my suggestion to those that were following me to sell their gold once we crossed the $1,900 threshold. You see, there is a difference between analyzing a market and how one should effectuate that analysis as an investor. Allow me to explain.
Even before the market topped, I noted two potential targets for the downside in gold. The higher target was struck in 2012, with the lower one being between $700-1,000, but with an the ideal 98-105GLD target region, with the potential to drop as low as 75 in GLD. Once that higher target was struck in 2012, I was watching to see if we would develop a confirmation of a bottom, at which time I would buy all pullbacks. However, when no confirmation was seen, I started focusing upon my secondary target, which was much lower.