Jim Sinclair’s Commentary
John Williams shares the following with us.
- August Production Decline Was on Top of Downside Revisions to July Activity
- Plunge in AutoManufacturing Highlighted Poor-Quality Seasonal Adjustments and Difficulties in Inventory Accounting
"No. 657: August Industrial Production"
Opinion: Gold may be a ‘buy’ as investors turn ever more bearish
By Mark Hulbert
Published: Sept 10, 2014 6:00 a.m. ET
CHAPEL HILL, N.C. (MarketWatch) — Gold is finally getting close to a bottom in prices.
That is the surprising conclusion of contrarian analysis, which for months now has stubbornly refused to turn positive on gold — even as the yellow metal has suffered a death by a thousand cuts. Just this week, for example, bullion hit a fresh three-month low — among indications that gold’s recent decline has violated some key technical levels.
But what contrarians focus on is market sentiment, and on that front there has been a big change: For the first time in a long time, a large number of short-term gold timers have decided to throw in the towel.
As a result, the market-timing community on balance is now more bearish than it has been in 14 months — which, according to the contrary logic of contrarian analysis, is a bullish development. The last time the typical gold timer was as gloomy as he is today, gold began a two-month rally in which it gained more than $200.
Consider the average recommended gold market exposure level among a subset of short-term gold market timers tracked by the Hulbert Financial Digest (as measured by the Hulbert Gold Newsletter Sentiment Index, or HGNSI). This average currently stands at minus 40.6%, which means that the typical gold timer is recommending that clients allocate nearly half their gold-oriented portfolios to going short the market.
That’s a particularly aggressive bet that gold will keep declining, and — at least according to contrarian analysis — these timers are unlikely to be right.
German Vice-Chancellor: Europe Requires Good Relationship With Russia
MOSCOW, September 14 (RIA Novosti) – German Vice-Chancellor and Minister of Economy and Energy, Sigmar Gabriel, believes that good relations with Russia are necessary for Europe, he stated in an interview with the German newspaper Bild on Sunday.
"Europe needs Russia, we are immediate neighbors and a good neighborhood is essential," Gabriel said in the interview.
The Vice-Chancellor expressed hope that Europe could trust Russian President Vladimir Putin again.
"We specifically notice during major international conflicts, for example in Northern Iraq and Syria, that it would be good if we could work together with Russia to jointly solve the conflicts," the German politician stated.
While Gabriel believes the European Union’s tightened sanctions against Russia were necessary in "mitigating" Moscow, bolstered efforts to resolve the conflict in Ukraine are also needed. Attempts from Germany to gather all parties to the negotiating table need to continue. Gabriel urged Foreign Minister Frank-Walter Steinmeier and Chancellor Angela Merkel to push for a meeting "despite all the setbacks, again and again."
Relations have deteriorated between Russia and the EU following the situation in Ukraine.
Jim Sinclair’s Commentary
This could unleash a reaction much larger than generally expected.
Scottish independence: Sterling on knife-edge as City braces for Scots vote
Monday 15 September 2014
The City is bracing for “a major reaction” to sterling and shares following the Scottish independence result as the London market faces what could be its most turbulent week since the 2008 banking crisis.
Bank of England Governor Mark Carney is returning early from this week’s finance meeting of G20 countries in Australia to monitor the markets in person from Thursday and Chancellor George Osborne has cancelled his trip entirely.
Howard Archer, chief UK and European economist at research firm IHS Global Insight, warned the closeness of the opinion polls meant that City traders were facing “substantial uncertainty”.
He said: “There is likely to be a major reaction, particularly for sterling, whichever way the vote goes. A vote for independence will highly likely result in a further appreciable sterling sell-off. A vote for Scotland to remain in the UK is likely to lead to a significant relief rally for the pound.”
Mr Archer added that in the event of a Yes vote, there is a “risk that gilt yields could rise markedly due to foreign investors being wary about what will happen with UK debt.
“However, the Bank of England could counter this by delaying an interest rate hike and possibly even resuming quantitative easing.”
UK Hints At Next Reserve Currency, To Issue Chinese Yuan-Denominated Bond
Submitted by Tyler Durden on 09/15/2014 12:41 -0400
Yuanification continues around the world. As The USA attempts to corral its allies in a ‘broad coalition’, an increasing number of people – including domestic economic policy advisors – are shifting away from the USD as primary reserve currency. However, the move by British Chancellor of the Exchequer George Osborne, announced Friday, is likely the most notable yet in the world’s de-dollarization. As Xinhua reports, the British government intend to be the first nation (ex-China) to issue Renminbi denominated bond and to use the proceeds to finance the government’s reserves of foreign currency. Osborne described this dialogue outcome as "a historic moment" and a statement of British confidence in the potential of the RMB to become "the main global reserves currency".
As Xinhua reports,
British Chancellor of the Exchequer George Osborne announced Friday that the British government intend to issue a Renminbi denominated bond and to use the proceeds to finance the government’s reserves of foreign currency.
"I can now announce that the UK government intend to be the first national government outside of China to issue a bond in China’s currency. We issued bonds in U.S. dollar before, now we will be issuing a bond in RMB," said Osborne in the press release of the Sixth China-UK Economic and Financial Dialogue (EFD).
Chinese Vice Premier Ma Kai and Osborne concluded the meeting of the Sixth China-UK Economic and Financial Dialogue in London.
Osborne described this dialogue outcome as "a historic moment" and a statement of British confidence in the potential of the RMB to become "the main global reserves currency".