Via ADM Investor Services' Paul Mylchreest,
A rather thought-provoking chart which we've been looking at is the ratio of the SKEW (the chance of an extreme or outlier event, i.e. OTM versus ATM options) versus the VIX (the expectations for more 'normal' day-to-day volatility - the price of hedging implied by ATM options)... and is an indicator of how the market is pricing the possibility of a potential black swan event.
The difference in sentiment between the conference I spoke at in Hong Kong and the conference I just spoke at in Vancouver was really noticeable. The Asians view this as an incredible opportunity to get involved in the sector, whereas in Vancouver you could feel the mood was downbeat.
We both know that the summer is generally very soft in junior resources. My suspicion is that we are now entering a period from now to September that is perhaps the last good buying opportunity in the sector. So that's what I'm focused on. I'm looking for bargains and looking to deploy the money that Sprott has been successful in raising over the last year.
An explosion has struck a pipeline near the eastern Ukrainian city of Poltava.
Witnesses say the flame is reaching 200 meter high, RIA Novosti reports.
The Urengoy–Pomary–Uzhgorod natural gas pipeline is about one kilometer way from the nearest settlement.
No victims have been reported. Fire fighters crews have been deployed.
Relations between Russia and Ukraine have entered a new stage and are "moving closer towards a serious conflict", said State Duma Foreign Affairs Committee chief Aleksei Pushkov.
Russia did not recognise unilateral border demarcation by Ukraine which was "contrary to all norms of international law", Russia's ITAR-TASS news agency quoted Pushkov as saying Tuesday.
"An attack on the Russian embassy, an attempted attack on the consulate-general in Odessa, insults to the Russian president, regular arrests of Russian journalists -- I think this is a deliberate decision co-ordinated with the U.S -- all these are links of one chain," he said.
Central banks runt om i världen har investerat ca $29 trillioner i aktier och andra investeringar. Vi har därmed världens största pyramidspel och inte fria marknader.
Central banks around the world, including China’s, have shifted decisively into investing in equities as low interest rates have hit their revenues, according to a global study of 400 public sector institutions.
“A cluster of central banking investors has become major players on world equity markets,” says a report to be published this week by the Official Monetary and Financial Institutions Forum (Omfif), a central bank research and advisory group. The trend “could potentially contribute to overheated asset prices”, it warns.
The report, seen by the Financial Times, identifies $29.1tn in market investments, including gold, held by 400 public sector institutions in 162 countries.
Formaterar vi nu en head and shoulder för guld. Kommer vi in i juli ser vi stor potential för guldet.
The imbalances at present seem so huge, that I would not be surprised if we get a repeat of the Volume Investors Inc. collapse. That firm went belly up in 1985 when they could not cover quickly enough their huge short position in gold, which not only wiped out the firm’s capital, but caused big losses for others as well. So as I see it, the shorts in silver - and gold too for that matter - are walking on a knife-edge, flirting between the illusion of solvency and collapse.
Clearly, the big test for gold will be to clear the $1,312 area. For silver, the big hurdle is around $20.30.
It’s time to pay attention and start looking for reversal patterns in price.
Where are we now? Below is a chart from BCA showing the Fed Funds Rate Cycle. In essence, this chart neatly illustrates what the interest rate cycle imposed by the U.S. Federal Reserve looks like. The red circle indicates where we are right now: Phase IV, also known as the “easing” phase of the monetary policy that was enacted in 2008 in the U.S., better known as quantitative easing (QE).
As we know, the Fed enacted QE to stimulate our nation’s economy. Right now we’re benefitting from our placement in Phase IV of this cycle because it is in this phase that the Fed is able to keep interest rates low, keep reserve requirements low and continue printing money. Similarly, when money is “easy,” businesses can find funding for projects and consumers have easier access to credit.
Historically, Phase IV (as well as the shift towards Phase I) are the best for equity investors because stocks usually rise during these two positions in the cycle.
Why these phases are good for gold, too. We have been in Phase IV of the Fed Funds Rate Cycle for a few years now, and are expected to remain here into 2015. Eventually the Fed will have to start tightening again and raise rates, although the numbers should remain relatively low for a while. Once this begins, we will move into Phase I.
When it comes to the performance of gold and gold stocks, history indicates good times are ahead based on where we are in the cycle. Take a look at the tables below showing median returns during the cycle dating back to 1970 and 1971. You’ll see that for gold and gold stocks, Phase IV and Phase I both show the highest median returns.
|Spot Gold, From June 1971||TSE Gold Miners, From July 1970|
|Phase I (Easy, Hiking)||11.8%||Phase I (Easy, Hiking)||16.2%|
|Phase II (Tight, Hiking)||2.2%||Phase II (Tight, Hiking)||-8.8%|
|Phase III (Tight, Cutting)||-4.3%||Phase III (Tight, Cutting)||-15.9%|
|Pase IV (Easy, Cutting)||9.2%||Phase IV (Easy, Cutting)||24.2%|
Note: Excluding the two-month Phase II period spanning the October '87 stock market crash.
Är det högre räntor som behövs för att få igång Velocity av dollarn och därmed enligt FED den behövliga inflationen
The signs are good. With record short positions in gold and silver, hedge funds and algorithmic traders should be worried at the lack of price confirmation: gold is holding well above its bear-market lows and silver is refusing to weaken into new low ground.
The first chart is of the Managed Money short positions in gold futures on Comex,
The sudden increase in shorts in both metals amounted to a dramatic bear raid. With gold rising every day this week the squeeze is now on, suggesting in the absence of any new and material factor the current rally should have enough legs to take gold to the $1300 level. The situation in silver is likely to have a more dramatic outcome, with the caveat that the active July contract is running off the board.
It is notable however that open interest in silver has been steadily growing to near-record levels for the last eighteen months, which tells us that buyers are absorbing everything the bears are throwing at the market. This is shown in the next chart.
The big news this week came on Wednesday, when Al-Qaeda affiliated rebels in North-Western Iraq took the cities of Mosul and Kirkuk. In the process they captured a large amount of military hardware and are now well equipped. This morning Iraq's problems appear to be spreading into a wider Sunni insurrection, with Kurdish tribesmen also rebelling against Bagdad rule. Importantly, the Kirkuk-Ceyhan pipeline, which takes oil to the Mediterranean, as well as the Kirkuk Oilfields themselves were first to be affected, and oil prices rose sharply on the news. Indeed, all Iraq's oil production could be threatened. Higher energy price assumptions are likely to influence economists' forecasts of economic growth in US and other markets.
Economists had been downgrading growth prospects already. In the US first quarter GDP expectations have been revised to a contraction of as much as 1.6%, and the Fed's forecast of 2.8% growth for the whole year is now looking too optimistic. The US is not alone: Japan and the Eurozone are fighting deflation and China is trying to rein in credit growth. In short, the conditions that have led to low bond yields and highly-valued stock markets may be changing for the worse.
Where this leaves precious metals is yet to be seen, but it is worth bearing in mind that hedge and other funds exposed to losses in bonds and equities will likely reduce their short positions in gold and silver. And if the current weakness in bonds and equities persists, it should be positive for precious metal prices as the bears run for cover.
Stating There is No Inflation is an Error
House prices “remain well above the historical averages for a majority of countries” in relation to incomes and rents, Mr Zhu said in a speech to the Bundesbank last week, which was only released on Wednesday because it clashed with a European Central Bank announcement. “This is true for instance for Australia, Belgium, Canada, Norway and Sweden,” he said.
-$1,280,000,000,000 - Most people are really surprised when they hear this number. Right now, there is only 1.28 trillion dollars worth of U.S. currency floating around out there.
-$17,555,165,805,212.27 - This is the size of the U.S. national debt. It has grown by more than 10 trillion dollars over the past ten years.
-$32,000,000,000,000 - This is the total amount of money that the global elite have stashed in offshore banks (that we know about).
-$48,611,684,000,000 - This is the total exposure that Goldman Sachs has to derivatives contracts.
-$59,398,590,000,000 - This is the total amount of debt (government, corporate, consumer, etc.) in the U.S. financial system. 40 years ago, this number was just a little bit above 2 trillion dollars.
-$70,088,625,000,000 - This is the total exposure that JPMorgan Chase has to derivatives contracts.
-$71,830,000,000,000 - This is the approximate size of the GDP of the entire world.
-$75,000,000,000,000 - This is approximately the total exposure that German banking giant Deutsche Bank has to derivatives contracts.
-$100,000,000,000,000 - This is the total amount of government debt in the entire world. This amount has grown by $30 trillion just since mid-2007.
-$223,300,000,000,000 - This is the approximate size of the total amount of debt in the entire world.
-$236,637,271,000,000 - According to the U.S. government, this is the total exposure that the top 25 banks in the United States have to derivatives contracts. But those banks only have total assets of about 9.4 trillion dollars combined. In other words, the exposure of our largest banks to derivatives outweighs their total assets by a ratio of about 25 to 1.
-$710,000,000,000,000 to $1,500,000,000,000,000 - The estimates of the total notional value of all global derivatives contracts generally fall within this range. At the high end of the range, the ratio of derivatives exposure to global GDP is about 21 to 1.
Most people tend to assume that the "authorities" have fixed whatever caused the financial world to almost end back in 2008, but that is not the case at all.
Draghi effekten har redan klingat av. Har centralbankernas magi över marknaderna svalnat. Nästa vecka är det dags för FED.
Oljan går upp p.g.a. oroligheter i Irak. Det kan bli effekter om man stör infrastrukturen för olje ledningarna i området.
There is much hope that after a dismal Q1 GDP report of -1% annualized growth in the domestic economy, that Q2 will see a sharp rebound of between 3-4% according to the bulk of economists. The Federal Reserve is predicting that the U.S. economy will grow as strongly as 2.8% in real terms for the entirety of 2014. The achievement of the Fed's rather lofty goal would require a real 4% annualized growth in each of the next three quarters. The problem with this assumption is that the last time that the U.S. economy grew at 4% or more, over three consecutive quarters, was in 1983.
Vi närmar oss nu slutet på ekonomisk framgång med hjälp av skulder. Från 1971 då guldet lämnade det monetära systemet har skulderna ökat exponentiellt.
Enligt COT rapporten så är det upplagt för en större uppgång i silvret. Bankerna har inga stora korta positioner medans Hedge fonderna inte har några långa positioner.
Turning now to the COT charts we can see the dramatic improvement in the COT structure on the chart below, with Commercial shorts falling to the sort of levels that prevailed ahead of the big rally last August, and the more muted but still significant rally of last February. Large Spec longs are now almost non-existent – they have “thrown in the towel” which is very positive sign indeed. This is a very positive COT structure indeed and the expected new uptrend could begin at any time, although we suspect there may first be a short-term drop, partly because gold’s technical situation could still use some improvement, and partly because seasonal factors are not favourable this month.
Silvret befinner sig nu i den långsiktiga köpzonen samtidigt som vi går in i en bra period för silverpriset.
USAs totala skulder är på väg över $60 trillions vilket skall sättas i relation till landets BNP om ca $17 trillions.
The Standard & Poor's 500 index rose 4.46 points, or 0.2 percent, to close Thursday at 1,892.49, within 1 percent of its record high. The index is up 2.4 percent for the year. The index' trailing price-earnings ratio registered 18 as of Friday, according to Birinyi Associates. That's above its historical average.
Faber isn't too enthusiastic when it comes to Treasurys either, saying there is "nothing attractive" about them.
The 10-year Treasury yield stood at 2.55 percent early Friday, after hitting a 6 ½-month low of 2.47 percent last week.
While acknowledging that U.S. stocks are "relatively expensive," he noted that Europe and emerging markets offered better value.
"If I were to buy equities I would rather go into emerging economies, but I don't think there is a hurry."
"I think we are bracing for a general asset deflation," Faber stated. "I think the system is still very vulnerable. I'm not predicting a complete collapse, because money printing can go on almost endlessly. But it will have unintended consequences."
Spanska 10-åringen är nu på samma nivå som USAs 10-åringen. Är det någon som tror att allt är som det skall.
Härifrån kan det bara gå åt ett håll och det är mot mer stress i marknaden. Precis som innan förra krisen.
Utvecklingen för EU går åt fel håll men börserna tickar på uppåt med hjälp av ECB som tillhandahåller billiga pengar. Hur länge till kan detta pyramidspel fortgå?
japan levererar bra BNP för Q1 men det beror på ökad konsumtion före momshöjningen. Vis er ett stort tapp för konsumtionen för Q2.
Världens långräntor är nere på rekordlåga nivåer samtidigt som ekonomin skall vara på väg uppåt. Det är något som inte stämmer och måste ge vika.
BOND VALUE IS IN THE YIELD BUT BOND PRICES GO UP WITH LESS YIELD
It is a Fools Game in Disguise!
For that you need to look at another measure of corporate profits—real-time reporting of all S&P 500 companies (shown below)—for further confirmation.
As you can see, the 12-month trailing profit margin of all S&P 500 companies serves as a much better coincident timing indicator of market peaks and, as well, a more imminent red-flag of economic recessions.
After last weekend's schizophrenic expanding (official) / contracting (HSBC) Manufacturing PMI, China's Services PMI printed at 50.7 - its lowest since August 2011, as the business expectations index dropped to an 11-month low. The Composite PMI improved (after 3 months of contraction) but most notably, the composite employment declines at the fastest pace since Feb 2009. What is perhaps most worrisome is, as Markit notes, "The latest survey signalled the second-weakest degree of optimism since the series began in November 2005."
“Since the 1970s, Saudi Arabia [has been] the leader in what’s called the petrodollar. It basically means that Saudi Arabia and, by extension, OPEC, price oil in dollars, so the world market is in dollars.
“Russia is a major natural resource exporter; they price their exports in dollars as well. But Russia now is engaged in a financial war with the US around the issues in Crimea and Ukraine.”
The threats to the dollar are “ubiquitous,” the author states in his book. The only way the US can pay off its $17 trillion debt is with inflation, which would drive other countries away from the dollar while the accumulation of gold by Russia and China presages the shift to a new reserve asset.
“The next time we will have a liquidity crisis in the world it’s going to be bigger than the ability of central banks to deal with it. The IMF will basically have to bail out the world by printing the SDRs (an international reserve asset created by the IMF in 1969 to supplement its member countries' official reserves). By that time, you will see the SDR emerge as the new global world currency,” .
Produktiviteten under Q1 föll mer än väntat samtidigt som vi fick ett större underskott i handelsbalansen under april. BNP för Q2 kan nu få svårt att leva upp till högt ställda förväntningar.
At 16,817, wave A and C are equivalent—this is the highest probability target using a three-wave approach; but obviously it is no Holy Grail. “Nobody rings a bell at the top.” “Top picking is a mug’s game.” But, this technical analysis suggests we are getting very close to a major top.
Also notice on the chart (below) the interesting divergence pattern between price and momentum we saw last time we got a decent correction back in 2011.
Since 2009, the reported earnings per share of corporations has increased by a total of 230%. This is the sharpest post-recession rise in reported EPS in history. However, that sharp increase in earnings did not come from revenue which is reported at the top line of the income statement. Revenue from sales of goods and services has only increased by a marginal 26% during the same period. This is shown in the chart below.