Your Window to Buy Gold Below $1,700 Is Closing

by Jeff Clark, Casey Research:

Even the hardiest investors have been lamenting that gold prices have been stuck in a rut for a long time. Others with less experience have watched the market waiting for something to happen. And as always, many bailed out of the market entirely, licking their wounds.
But some, including me, have been stocking up. We’re convinced prices won’t stay down forever. In fact, I think there’s a good reason to buy gold if you can, and as soon as possible.
Here’s why:

Based on the data I chart below, I believe the window of time to buy gold for less than $1,700 an ounce is very limited.

I examined gold’s three largest corrections since the bull market began in 2001, including how long it took to recover from those corrections and establish new highs.
The conclusion that emerged is that the current lull in gold prices will almost certainly end soon, if it hasn’t already.
Read More @ CaseyResearch.com

Can "It" Happen Again... Again?

Many have talked about it. More have eschewed it. But Minsky's hugely important insight in asking the question "Can 'It' Happen Again?" regarding the Depression remains critical reading for any- and every-one who opines day-in and day-out on how much we need or do not need Central Bank money-printing. As Bill Gross put it: "Minsky, originator of the commonsensical “stability leads to instability” thesis; the economist with naming rights for 2008’s “Minsky Moment”; the exposer of the financial fragility of modern capitalism; probably couldn’t imagine the liquidity trap qualities of zero-based money, because who could have conceived 30 or 40 years ago that interest rates could ever approach zero per cent for an extended period of time? Probably no one. Nor, more importantly I suppose, can Ben Bernanke, Mario Draghi or Mervyn King. In their historical models, credit is as credit does, expanding perpetually after brief periods of recessionary contraction, showering economic activity with liquid fertiliser for productive investment and inevitable growth." For a long-weekend, we present the full 30-year-old must-read paper.

Spain's Debt Buyer Of Last Resort Becomes Seller In Scramble To Fund Deposit Outflows

Several days ago we reported that Spanish financial institutions suffered the largest deposit outflow on record in the month of July when a whopping EUR74 billion, or 5% of the country's entire asset base, picked up and left, the bulk of it most likely taking the well-known path of least resistance to the safety of Swiss and German bank vaults. We showed how this looks visually, and as the chart below confirms it can be summarized in one word only: waterfall. And while in isolation this news was bad enough, a far more troubling implication arises when one considers that in Europe's financial Ice-9 world, in which the interbank market has been dead for over a year, and where the ECB is the shadow lender of only resort, providing funding via various repo channels to local banks to fund Spain's deficit by purchasing sovereign bonds in the primary market. To wit: since the entire financial system's liabilities (deposits) just declined by a record EUR74 in one month, since the consolidated balance sheet has to balance, either Spain's (thoroughly insolvent) banks had to generate EUR74 billion in shareholder equity in one month, i.e. profits - a prospect which is rather amusing considering Spain's banking system recently officially demanded a European bailout, or banks had to sell a like amount of assets in order to fund this outflow. Naturally, they chose the latter. The problem is that the security they sold is the one which only the banks have been buying recently in order to preserve the illusion that Spain is solvent. It was Spanish sovereign bonds.

China Is Loosening Up Too Early

Admin at Jim Rogers Blog - 45 minutes ago

Every time that they have begun to pop the real estate bubble in the past, once things start getting tough they get a lot of phone calls and they start loosening up again. In my view, China has loosened up too early every time in the last decade, which is why the real estate bubble has continued and it's gotten worse. So it looks as though China is going to loosen up again and in my view they're going to loosen up again too early this time around, and you'll probably have a continuation of the same old thing - more inflation and perhaps excesses in real estate again. - *in Mineweb *... more » 

 

Different Levels Of Success

Admin at Marc Faber Blog - 3 hours ago

Success comes on different levels in life. You can have monetary success and you can have success because you are a nice doctor that helps poor people and you can have success by keeping the garden of your boss in perfect condition. I am not a kind of a person that values success very highly for people that have business success or are famous. Fame is totally irrelevant. Three years after you and I die, nobody will know us and talk about us. - *in media.bloomberg* *Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets arou... more » 

 

Youth unemployment skyrocket in Europe/Bernanke may officially turn to QE III on its books/ Gold and silver skyrocket on first day notice/ all bourses rise on QE III hopes/

Harvey Organ at Harvey Organ's - The Daily Gold and Silver Report - 3 hours ago

Good morning Ladies and Gentlemen: Gold and silver both skyrocketed today boosted by hopes of official QEIII on the books of both the ECB and the USA.  The price of gold finished the comex session at $1684.90 up a huge $31.40.  Silver also responded in kind rising by $1.00 to $31.37.  The bankers were supplying the short paper to those paper players wishing to get in on the action. In the

 

Friday Night At Jesse's: Kung Fu Hustle (English)

Hedge Fund Silver Shorts getting Squeezed Out

Trader Dan at Trader Dan's Market Views - 9 hours ago

Take a look at the following charts of the positions of the hedge fund community in the silver market and notice what has happened to them as a result of the break of overhead resistance levels on the technical price charts. Shorts are being forced out as fresh longs invade the market. You should also note that this data does not include today's HUGE move higher which no doubt caught a large number of fresh top pickers off guard.

 

Monthly Gold Charts

Trader Dan at Trader Dan's Market Views - 9 hours ago

 

Gold Daily and Silver Weekly Charts - How Sweet It Is

SP 500 and NDX Futures Daily Charts - Much Ado About Bernanke

Charting China's 'Monetary Policy' Impotence

Iron Ore inventories to the roof; steel production still ramping; food and energy prices soaring; economy deteriorating rapidly. So why no major stimulus from the PBoC? Too busy in-fighting or perhaps waiting on The Fed or The ECB to rescue us all; we suspect neither of the above. This chart, via Goldman Sachs, indicates the relative looseness of financial conditions (easing / tightening) compared to China's current activity. These two proprietary indicators provide a 'cleaner' view of the various aspects of China's monetary/fiscal policies (from fiscal stimulus to RRR hikes or reverse repos) and its 'real' level of economic growth (unbiased by political need). As is extremely evident, since the initial collapse and huge stimulus in 2008/09, the PBoC has become less and less capable of generating any additional economic activity. Whether this is due to the same shadow-banking effect Europe and the US suffer from in their transmission channels; or more simply that the Chinese may have also hit their bubble-created balance-sheet-recession debt-minimization limit (no matter how mandated from the top-down that spending is).

Visualizing The Public Vs. Private College Debate 

 
While attending a private college and being trained in the mystical art of CTRL->C / CTRL->P might leave you strangled by a debt-load larger than Spain's, it is empirically true that salary-upside remains (almost $10,000 per year more); the following infographic lays out why the public vs private college debate continues.

Today's Mad 'Manipulated' World Of Markets; Or "How To Fit 2 Seconds Of Trading Into 1 Millisecond!"

We noted earlier that something looked fishy into the close today - our so-called 'tickle-algo' appeared evident - but without the superlative HFT data that Nanex has, we had no way to know just how berserk things were. Here, for your viewing pleasure (with a hidden message) is the last 1 millisecond of trading in SPY today - a period in which as much trading data (quotes and trades) that would fit in two seconds of 'pipe' was blasted through the exchange networks. Nanex's 'Whac-a-mole' algo in all its glory - as they note "this has the strong odor of manipulation."

Europe's Scariest Chart... Got Scarier

While the general level of unemployment in Europe is rising in a scary enough way (more detail here), the one really concerning data point has gone from bad to worse. When we last looked at youth unemployment in Europe, things were stabilizing a little, though at extremely lofty levels. With the release of July's data, the situation has deteriorated rapidly; Euro-Zone youth unemployment hs now ticked back up to its euro-era record-high of 22.6% (18-year highs). Only Portugal saw an improvement is the rate of unemployment among the Under-25 age group (from 37.6% to 36.4%) though it remains anarchically high. Italy was the hardest hit, back above 35% with its largest rise in youth joblessness in 5 months, Ireland rose back above 30% for its biggest rise in 11 months as France jumped to two-year highs and Spain and Greece are practically deadlocked with ~53% of their younger-generation out of work - new all-time records. Why do we worry? Why is this so scary? Two reasons - this and this.

The End Of The Euro: When Will It Happen?

In Rome, the main post office is in a majestic old building with imposing architecture. It was a procession just to buy a few stamps. Stand here, stand there. Take this ticket, fill out this form, print that form. What should have taken 10 seconds took 10 minutes;  the process it took to get there was a real eye opener. They have all these fancy IT systems, but we get the sense that this ‘technology’ just gives the post office a veneer of modernity and sophistication without actually being necessary or adding any value. This is typical of bureaucracy: take a simple task, make it unnecessarily complicated, then spend a bunch of money on technology that makes it even more complicated. Given this experience, Italy has clearly mastered the art of unnecessarily complicating the simple. It’s no wonder they have serious problems paying the bills. Moreover, the country’s demographic challenges indicate the country’s fiscal situation cannot improve. Robust economies are productive… and productivity is typically not associated with the elderly. Italy has one of the world’s oldest populations concurrent with one of the lowest birth rates. This trend drives an unsustainable fiscal quandary: bloated public sector bills with lots of old people to pay pensions to, coupled with a rapidly shrinking population devoid of young workers to pay taxes.
At this point, there can be little doubt that Italy will exit the eurozone... most likely voluntarily. A return to the lira means the Italian government (probably to be headed by Berlusconi once again) would be free to print currency at will. This is the only reasonable solution remaining. When will it happen? Probably sooner than we think.

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