Posted at 11:31 AM (CST) by & filed under Jim's Mailbox.

Jim,

From your posting yesterday (listed below), July 26, 2015, one must take note of the corner the Fed has painted itself into.

A true definition of “Between a rock and a hard place.”

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To save the housing market, the Fed must increase inflation. However, in doing so they would crash the bond market.

Sadly, there is no respectable choice.

And the longer they wait, the more severe the consequences.

CIGA Wolfgang Rech

The Most Dangerous Bubble In History And Why The Central Banks Are Now In A Panic
July 24, 2015
By Michael Pento of Pento Portfolio Strategies

July 24 – (King World News) –

According to Trulia, at its 2006 peak home prices were 39% overvalued based on consumer incomes and cost to rent

But the bond bubble is a classic bubble thanks to Wall Street and the Federal Reserve. The bond market qualifies as being in a state of over supply because there has been an additional $60 trillion in total global debt that has accrued since 2007.

During the first half of this year, $891 billion in bonds were issued in the U.S. alone. That’s up 7.5% from the same period in 2014, which was itself a record year, according to the Securities Industry and Financial Markets Association.

More…

Posted at 1:52 PM (CST) by & filed under In The News.

The Most Dangerous Bubble In History And Why The Central Banks Are Now In A Panic
July 24, 2015

On the heels of another chaotic trading week in major markets, today one of the top economists in the world sent King World News an incredibly powerful piece warning about the most dangerous bubble in history and why the central banks are now in a panic.  Below is the fantastic piece from Michael Pento.

KWN will be releasing interviews all day today with Eric Sprott and many others, but first…

By Michael Pento of Pento Portfolio Strategies

July 24 – (King World News) – One of the most ironic and fascinating characteristics about an asset bubble is that central banks claim they can’t recognize one until after it bursts. And Wall Street apologists tend to ignore the manifestation of bubbles because the profit stream is just too difficult to surrender.

The excuses for piling money into a particular asset class and sending prices several standard deviations above normal are made to seem rational at the time: Housing prices have never gone down on a national basis and people have to live somewhere, the internet will replace all brick and mortar stores, and perhaps the classic example is that variegated tulips are so rare they should be treated like gold….

Continue reading the Michael Pento piece below…

I am willing to let the Dutch off the hook; back in the seventeenth century asset bubbles were virtually nonexistent because money was still in specie. But central banks have created the perfect petri dish for asset bubbles over the past three decades. Therefore, it’s imperative for investors to understand the classic warning signs of a bubble so you can avoid the inevitable carnage in the wake of its collapse.

As I identified in my book “The Coming Bond Market Collapse”, there are three classic metrics to determine when an asset has grown into a bubble: it becomes extremely over supplied, over owned and overpriced compared to historical norms.

The real estate market circa 2005 was a great example of a classic bubble. The supply of new homes boomed as new home construction rates peaked around 2 million units per annum in the middle of the last decade.  That’s about 400k units higher than what would be considered the historical average.

Just prior to the start of the Great Recession the level of home ownership in the U.S. soared. This rate hit a high of 69% during 2005, after bouncing around 64-66% for decades.  Today’s home ownership rate has fallen back to just 63.7%, which is the lowest in 25 years.

And finally, during the real estate bubble homes were massively overpriced. According to Trulia, at its 2006 peak home prices were 39% overvalued based on consumer incomes and cost to rent. On a national level the median home price to income ratio shot to 4.7 in 2006, compared to the 2.6 historical average. The current home price to income ratio has climbed back to 4.4 on a national basis. However, even though home prices are currently vastly overvalued, the housing market is not in a classic bubble because the real estate market is not currently in the conditions of being over owned or over supplied.

But the bond bubble is a classic bubble thanks to Wall Street and the Federal Reserve. The bond market qualifies as being in a state of over supply because there has been an additional $60 trillion in total global debt that has accrued since 2007.

During the first half of this year, $891 billion in bonds were issued in the U.S. alone. That’s up 7.5% from the same period in 2014, which was itself a record year, according to the Securities Industry and Financial Markets Association.

More…


Two Week Shanghai Gold Exchange Withdrawals Exceed All 2014 Comex Deliveries

The numbers below are simply SHOCKING:

Submitted by PM Fund Manager Dave Kranzler, Investment Research Dynamics:

The Shanghai Gold Exchange is the only major official physical gold trading market in the world.  All trades on the exchange are settled with the exchange of ownership on physical gold bullion.   Paper future contracts do not trade on the SGE.   In contrast, trading occurs on the LBMA and Comex in paper gold.  The Comex is de facto a 99.999% paper gold exchange for which the percentage metal backing the paper traded is minuscule.  The LBMA has been rapidly “catching up” to the Comex in this regard, although on a percentage basis the LBMA experiences a higher amount physical gold exchanged than the Comex.

Because of the way in which the SGE functions, gold withdrawn from the SGE measures the true demand for gold in China in a given time period.  All gold – except for the gold purchased by the Peoples Bank of China – purchased by any form of end user must pass through the SGE by law.  It is for this reason that “withdrawals” represent the most accurate measurement of demand for gold in China – except the Central Bank’s demand.

In the past two weeks, 106.1 tonnes of gold were withdrawn from the SGE.  As Smaulgld.com has observed:

Gold withdrawals on the Shanghai Gold Exchange the past two weeks were larger than the amount of gold delivered on COMEX during 2014 and greater than the amount of gold Germany has repatriated from the New York Fed since 2013.

I’ll point out one minor correction to the fact above:  it’s more gold than the U.S. Government has been able to repatriate back to Germany.

Year to date SGE withdrawals are 1,260 tonnes.  This translates into an approximate annualized run-rate of 2400 tonnes – with one of heaviest seasonal periods of Chinese gold demand still to come.

I find it fascinating how the entire world, including and especially the U.S. media, has summarily dismissed the unwillingness of the U.S. Government to return Germany’s gold. Recall, Germany originally asked for over 600 tonnes of gold to be returned.  This was after the Fed refused a request by a German delegation to inspect its gold (the Fed allowed the delegation into one of the nine vaults where the gold is supposedly being “safekept”).

If the gold is there and it belongs to Germany, why is the U.S. Government dragging it’s feet on this matter?   The question, of course, is highly rhetorical.  With China moving  more gold into the country and delivering to the entities who pay for this gold, transportation and delivery is not the issue.

At some point in the future, I have no idea when and neither does anyone else, there will be a massive upward explosion in the price of gold which is ignited by investors and Governments holding paper gold and who make move to take delivery of physical gold that no longer exists in the custodial vaults listed on their paper claims.

More…

Posted at 3:10 PM (CST) by & filed under In The News.

US Mint Sells Most Physical Gold In Two Years On Same Day Gold Price Hits Five Year Low
Tyler Durden on 07/24/2015 20:49 -0400

Three weeks ago, we reported that the US Mint had run out of physical silver on the same day silver plunged to its lowest price in 2015. This happened just days after the UK Royal mint announced that “during June, we experienced twice the expected demand for Sovereign bullion coins from our customers based in Greece.”

While the surge in physical demand clearly did not explain the liquidation in the price of “paper” silver, we are still hoping that the OCC writes us back with an explanation why this happened, and maybe it can clarify also just how much more silver the mint will sell before it runs out of silver in inventory again as it did 20 days ago.

We bring all of this up because just like 20 days ago when unstoppable demand for physical silver met an immovable paper silver selling object (with the “object” for now winning), so earlier today the price of gold tumbled to the lowest level in 5 years, some $1,072 per ounce, before it staged a dramatic comeback closing just under $1,100…

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… thanks in no small part to the illegal spoofing we noted earlier.

More…

Posted at 4:31 PM (CST) by & filed under Bill Holter.

Dear CIGAs,

After planning to take this week off for a little rest, market gyrations have changed the plan.  Initially next week I was going to pen a piece titled “Truth, Justice and no longer the American way”.  This will now wait a bit.

This past Sunday night and Monday’s action in gold needs to be discussed of what I believe is now a rapidly moving big picture.  $2.7 billion worth of gold futures were sold in just 2 minutes Sunday night.  As I have asked before, “who” could possibly “own” this much gold other than an official source?  The answer of course is nearly no one other than a very small handful of ETF’s.  In perspective, $2.7 billion worth of gold is roughly 3% of global production.  Said differently, it amounts to nearly 10 days worth of labor and production worldwide… sold in less than two minutes!

  Next, assuming there really is an entity that owns this much gold, “who” in their right mind would sell it in this fashion?  Who would sell so much and so rapidly concentrated in time as to knock the price down $50?  What trader would still have a job the following day if their own sale created a drop of four percent in the proceeds received?  Traders today fight over one thousandth of a percent, are we to believe a trader was willing to give up 4%?  Was this trader so “scared” that gold was going to drop Mondaythat he just “had to get out”?  No, it is obvious to even the most disingenuous, this was purely an “operation”, one meant to depress the price of gold at any cost.  In perspective, this trader by not spacing out the trade cost his “firm” $40 million if you only use the midpoint of the trade.  Will this be reflected in his year end bonus (sarcasm)?  As of today, finally, the hunt is on as to “whodunit” http://www.zerohedge.com/news/2015-07-23/hunt-mystery-gold-bear-raid-leader-begins ???

  In my opinion they may need to look to only two sources though only one is necessary.  In every trade there are two sides, the buyer and the seller.  Have you ever wondered “who” the buyer is in the middle of the night to such large sales?  What if it is principally only two houses who trade back and forth with each other and then flatten out over the course of the next few days?  In essence, if this is the case there is not really any risk because they would always be “flat” between each other.  I don’t know if we will ever find out “whodunit”.  This is certainly a possible scenario and one in a world where the rule of law has been revoked …certainly feasible.

  Switching over to silver, the low prices have again created havoc in the physical market.  Prior to Sunday, the U.S. mint had already suspended sales of Silver Eagles.  This was done for one of only two possible reasons.  1. demand was so great they could not keep up with it or 2. they could not source physical silver to mint the coins.  This is exactly akin to Venezuela’s toilet paper shortage.  They have mandated a retail price below what it can be produced for and thus …manufacturers have stopped making it because they cannot earn a profit.  Simple!Another analogy would be a butcher who advertised $1.99 filet mignon.  Even if he had any to begin with, it would not last more than a few moments and you would be stuck slapping some $3.99 a pound hamburgers on your grill.

  As of now, coin dealers across the U.S. are on back order for nearly all silver products.  The premiums as in other similar previous instances have risen and product has been swept off the shelves.  What is the “real price” of silver you ask?  It is whatever you must pay to receive real metal.  As it stands now, COMEX paper prices and real physical prices are about 15-20% apart from each other.  In my opinion, should COMEX press prices further down, they risk exposing themselves as a fraud.  Already in July, some 3 million ounces have jumped queue and been demanded for immediate delivery.  In other words, COMEX is risking creating a “run” on physical metal which is 100% contrary to what low prices have been used for.  Low prices are the main tool used of “sentiment discouragement”, it very well may turn out that these low prices create a stampede into their laughably small inventory!

  From a broader perspective, what I believe we are seeing is simply one “skirmish” (but at the very core) in a global financial war between the West and the East.  We now know several other pieces to the puzzle.  China, the leader of the East is clearly economically slowing down as evidenced by many recent statistics, the container trade numbers being most recent;

Their stock market is imploding and capital flight is in the hundreds of billions.  Couple this with China dumping U.S. Treasury securities via their “Belgium accounts” and we have a better picture of the “financial war” being waged.

  As a theory, most believe the 600 tons of gold announced by China last week was the reason for the Sunday/Monday drop.  This I believe is correct but for 180 degree wrong reasons.  Many were shocked and disappointed at the number of only 600 tons.  It truly is laughable as it represents about 3 months worth of gold China currently imports and has been for over 5 years.  I believe they made this announcement for two reasons.  First, they needed to show more gold in order to be considered by the IMF for inclusion into the SDR this fall.  I also believe they wanted to show a lower number so as not to spook gold higher as they are clearly a buyer each month.  If you are a buyer, why press the price higher as long as you are receiving delivery?

  Going a step further and tying this all together we can see several things happening.  China is now witnessing an unprecedented capital outflow while the U.S. dollar has gotten stronger.  A strong U.S. dollar is textbook warfare against Russia and aimed at tightening the screws further both financially and economically. We have heard from Sergei Glayzev on several occasions, Russia/Mr. Putin plan on dropping a financial and moral “truth bomb” on the United States.  They will only be pushed so far, I believe some sort of data dump can be expected at any moment.

  If you look at this from the standpoint of “war”, these are all chess moves between those issuing a fake currency and those wanting to do real trade with real settlement.  Did the U.S. just “punish” China for being a gold buyer and making an announcement (even though miniscule)?  I think this can be looked at as the Western banks are short paper gold derivatives and long dollars whereas the East is long real metal and desirous of leaving the Western banking system behind.  There is no other reason China and Russia would have set up trade banks, clearing systems, currency hubs etc. all over the world if they did not expect to use them.  This is a war between the West wanting to prolong their own current fiat system and the East wanting to move away to one that is equitable to all involved.

  We are already in WW III.  It is because of and being waged in financial assets.  It is clear to me the U.S. is in panic mode and trying to break the long term bull trend in gold.  If the trend cannot be broken, the dollar will be zeroed out.  Unfortunately, both sides know this full well.  The military warnings of late from both Russia and China have become much louder and the actions and movements by the U.S. (staging in Turkey for Syrian raids for example) much more dangerous.  As I see it, the U.S. “needs” war to cover many dirty financial tracks.  China/Russia on the other hand may try to prevent war by releasing “the truth” and thus crippling the U.S. financially and thus the ability to wage aggression.  The problem as I see it is the world is too far along technologically and the days of having to pay and fund an army long term is behind us.  Now, “kicking the table over” is a simple as pushing a button.  Unfortunately, this may be the only remaining choice for the U.S. in the financial collapse I see coming.

  Let me finish with a couple of questions.  Who do you believe is more levered, the East or the West?  Yes, China is levered and unquestionably going to suffer short term during the unwind.  Xi Jinping said this himself.  Who has a financial system layered with trillions of dollars in derivatives?  Which direction has physical gold been flowing for at least a decade?  Finally, what is the “real” price of gold or silver?  Is it what the paper exchanges say?  Or is it what it actually costs to purchase …in size?  I believe we will find out all of these answers and many more over the next few months.  The entire world will be shocked to its core when nearly everything we have come to believe in turns out to have been a Hollywood production of “Wag the Dog”!  I pray there will be “options” available to the West, though deep down I know this is not the case.

Regards,  Bill Holter
Holter-Sinclair collaboration
Comments welcome!  [email protected]

Posted at 3:36 PM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

Yes, the joys of finance in a technological world run by certified world class sociopaths!

In Latest Market Rigging Scandal, Wall Street Now Sued For Treasury Market Manipulation
Tyler Durden on 07/24/2015 07:48 -0400

“Defendants used electronic chatrooms, instant messaging, and other electronic and telephonic methods to exchange confidential customer information, coordinate trading strategies.”

“Traders at some of these primary dealers talked with counterparts at other banks via online chatrooms and swapped gossip.”

Sound familiar?

Those quotes are from a 61-page complaint filed in the Southern District of New York wherein Boston’s public sector pension fund accuses all US primary dealers (the cabal of usual suspect dealer banks that transact directly with Treasury and “have a special obligation to ensure the efficient function” of what was formerly the deepest, most liquid market on the planet) of colluding to manipulate the $12.5 trillion US Treasury market.

The alleged scheme (tipped here last month) was remarkably simple and involved precisely the same sort of conspiratorial, chatroom shenanigans employed by the very same banks who, at various times, have colluded to rig FX, gold, various -BORs, ISDAfix, and pretty much everything else.    

In short, the banks simply conspired to keep the spread between the when issued price and the price at auction as wide as possible, thus inflating their profits at the expense of everyone else where “everyone else” includes institutional investors and hedge funds all the way down to retirees and Main Street in general. From the complaint:

Defendants employed a two-pronged scheme to manipulate the Treasury securities market. First, Defendants used electronic chatrooms, instant messaging, and other electronic and telephonic methods to exchange confidential customer information, coordinate trading strategies, and increase the bid-ask spread in the when-issued market to inflate prices of Treasury securities they sold to the Class. Second, Defendants used the same means to rig the Treasury auction bidding process to deflate prices at which they bought Treasury securities to cover their pre-auction sales. Recent reports confirm that traders at some of these primary dealers “talked with counterparts at other banks via online chatrooms” and “swapped gossip about clients’ Treasury orders.

By engaging in this unlawful conduct, Defendants maximized the spread not only for transactions in the when-issued market, but also between their buy (auction) price and sell (when-issued) price.

And of course the collusion didn’t just affect the cash market but every market linked to Treasurys.

This conduct lined the pockets of Defendants while raising prices to investors trading Treasury securities in the when-issued market, investors trading Treasury security-based futures and options, and investors transacting in instruments benchmarked to the prices of Treasury securities determined at auction, including certain bonds and other asset- backed securities and interest rate swaps.

More…


Jim Sinclair’s Commentary

“The Onion” is satirical, but this article is so true I had to post it

Admit It: You People Want To See How Far This Goes, Don’t You?

The latest polls are out, and just as I predicted, I’m leading the Republican presidential race by a wide margin. You might be wondering how that could be. After all, it’s hardly been a month since I entered the field and I’ve already alienated America’s largest immigrant population, seen dozens of my high-profile business deals implode one after the other, and publicly insulted a national hero’s military service, all while not offering a single viable policy idea. But none of that matters at all, and my candidacy continues to surge forward, because none of you—not a single one of you—can look away. Not even for a second.

Admit it: You people want to see just how far this goes, don’t you?

My campaign’s just barely begun and I’ve already got you begging for more. Sure, you can say you oppose me or that you don’t even take me seriously. But let me ask you: How many articles have you read about Ted Cruz lately? How many news segments have you watched on Bobby Jindal? Or Rand Paul? But if those stories have the name “Donald Trump” in them, well, look who suddenly can’t get enough.

The thing is, I’ve got all of you eating out of my hand and I haven’t even released a single campaign commercial yet. Don’t look me in the eye and tell me you don’t want to stick around and see what that looks like, because you and I both know these ads are going to be absolutely incredible. I’ll be standing there projecting my best presidential air, saying “I’m Donald Trump, and I approve this message,” and you won’t be able to take your eyes off it.

You keep obsessing over every little thing I do and say, and I promise you’ll get your commercials real soon.

I can tell you’re practically salivating right now. And I’m going to keep riding this fascination, this little fixation you have with me as far as you’ll take me. You know I will.

And the TV spots are just the beginning. I know you, and I know what you like. You’ll absolutely eat it up when you see the “Trump ’16” T-shirts, the lawn signs, the bumper stickers; in fact, you’ll probably get a real kick out of pointing them out to your friends. Now, just imagine me shaking hands with senior citizens at a nursing home in Iowa. Wouldn’t you love to watch that? Or hear what comes out of my mouth when I speak to blue-collar workers at a struggling auto factory?

You say that doesn’t interest you? Oh, right, because you’re dying to see how Scott Walker behaves in those situations, right? Give me a break.

Just take a moment and imagine the primary debates: Jeb Bush; Chris Christie; me. Of course, they’ll put me in the middle because I’m ahead in the polls—far ahead at the moment. You already know how I answer even the most basic inquiries, so just picture me staring down the barrel of a question about foreign affairs or agriculture policy or something like that. You think you won’t sit there with bated breath while I try to tackle a question about using military force, or about food stamps, or about how my faith influences my decision-making? I guarantee you that my answers will be worth watching. And we both know you wouldn’t miss them for the world. It’d be the biggest, most-watched primary debate in history, courtesy of all of you.

And might I remind you that the longer this goes on, the closer I get to selecting a running mate. That realization kind of delighted you in a way, didn’t it? You absolutely want to know who I’d pick. A defeated GOP challenger who hates my guts? Another lunatic billionaire? Maybe my own son, Donald Trump Jr.? Whatever your wildest expectation is, I promise you I will surpass it. You’re not going to pass up an opportunity to see that, are you?

I can tell you’re practically salivating right now. And I’m going to keep riding this fascination, this little fixation you have with me as far as you’ll take me. You know I will.

So don’t try to tell me you’d be just as happy to watch one of these other bozos go toe-to-toe with Hillary Clinton or give a soaring speech at the national convention. And don’t delude yourself into thinking it’s everyone else who wants to watch me do this and you’re somehow above it. You want to see it. You want more. You hear “Trump” and your attention snaps to the TV screen right away.

Don’t think it’s true? Fine. You know what you have to do to make me go away. Just quit paying attention. Stop reading this right now.

That’s right, I didn’t think so. I have the power to make the next 16 months one of the most incredible times in our nation’s history, and not a single one of you can say you’re not at least a little bit curious to see how this wild ride shakes out. So just keep clicking every link that mentions my name and hitting play on every clip of my public appearances, and I promise you will not be disappointed.

More…

Posted at 10:21 AM (CST) by & filed under Jim's Mailbox.

Jim,

War? If not, then this is how it begins.

CIGA Wolfgang Rech

Has The Land War Begun: Turkish Tanks Are Firing Into Syria
Submitted by Tyler Durden on 07/23/2015 – 12:29

As the following clip from Turkey’s DHA news agency shows, one may wonder if NATO-member Turkey’s land invasion of Syria, which many have said was long overdue following months of rhetoric and belligerent posturing, under the pretext of ISIS "liberation", has just begun.

Update, from the horse’s mouth: Turkey admits 4 tanks entered Syria to use something called a "retaliation right":

@zerohedge to prevent false infos, i must say just 4 tanks get through to use retaliation right.

— Lit.Col.Kenan Winer (@harunayanoglu) July 23, 2015

After Monday’s tragic terrorist attack in the Turkish town of Suruc, just across from the Syrian border and kilometers away from ISIS-controlled Kobani, which left dozens dead in what authorities claim was due to an ISIS-linked 20 yhear old suicide bomber, hostilities have dramatically escalated in the past few days culminating with news that one Turkish soldier killed and one was wounded in border province of Kilis by gunfire from Syria, according to state-run Anadolu Agency reports.

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Jim,

Jim Grant goes bullish on gold!

There are few people I trust in this world. They must be named Jim. Jim Grant is one I put my faith in. The other is you.

CIGA Wolfgang R

“Gold Conjunction of Price, Value and Sentiment and I’m Bullish” – Jim Grant
By Daniela Cambone 
Thursday July 23, 2015 13:53

(Kitco News) – Don’t tell Jim Grant, the publisher of Grant’s Interest Rate Observer, that gold is a hedge.

The author and publisher said the metal is much more dynamic; providing a trifecta of price, value and sentiment, and investors should have exposure to it.

“[G]old is an investment in monetary and financial disorder – not a hedge. You look around the world and you see exchange rates are properly disorderly, when you look around the world of lending and borrowing — we are in a regime of price control by another name, so-called zero percent rates and quantitative easing by the world central banks – we are in one of the most radical periods of monetary experimentation in the annals of money,” Grant told Kitco News Thursday.

Grant added that it could be that it all works out, albeit a very “low probability.” “You want to have exposure to the reciprocal asset of the paper assets that are the most popular – so gold, to me, is now the conjunction of price, value and sentiment, and I am very bullish indeed.”

More…

Jim,

And Martin Armstrong calls this the panic selling week for Gold, yet ignores the blaringly obvious dumping at the same time he insults our intelligence

CIGA JB Slear

The Hunt For The "Mystery" Gold "Bear Raid" Leader Begins
Tyler Durden on 07/23/2015 12:50 -0400

In the immediate aftermath of Sunday night’s massive gold slam, which was oddly reminiscent of the great silver crash of 2011 when on May 1 just around 6:25pm, silver plunged by 15%, from $48 to $42 with no news or catalyst…

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… marking the all time high price of silver in the current precious metals cycle (that particular ‘malicious seller’ has never been identified) the promptly arranged narrative was that because the gold crash took place in the span of 30 seconds just before Chinese stocks opened and broke the gold futures market not once but twice, that it has to be a China-based seller with Reuters taking the lead and quickly pointing the finger with an article titled "Gold hits five-year low, under $1,100 on Chinese selling."

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Ironically, the very same Reuters last night admitted that it had been wrong and that it was in fact: "New York sell orders in thin trade" that triggered the "Shanghai gold rout":

In early Asian trading hours on Monday, when typically only tens of contracts of gold are traded, investors dumped more than $500 million worth of bullion in New York in four seconds, triggering the market’s biggest rout in years.

The sell-off began when one or more massive sell orders hit the price of gold on the CME Group’s Comex futures in New York a tenth of a second after 9:29 a.m. in Shanghai,triggering turnover of almost 5,000 lots of gold in a blink of an eye. That equates to 13 tonnes of gold, more than typically trades in hours during this time of day, and the selling knocked the price almost $20 to $1,100 per ounce during those four seconds. It marked the first leg of a dramatic 60-second sell-off that saw prices sink more than 4 percent to five-year lows.

And just like that the narrative shifts again: instead of a Chinese seller, the real culprit appears to have been a US-based entity masking as a Chinese trader, around which the media then conveniently built a further goal-seeked "story" in which the Sunday night selling (by a US entity now) was the result of a PBOC announcement that its gold holdings had risen to "only" 1600 tons… however the problem is that all this had been known since Friday morning.

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Jim,

Interesting.

-Our false/massaged BLS reports, such as today’s "wonderful" jobless numbers…..

-Our  continual criticizing of Europe, Japan, Australia, and others…..

-Our manipulation of the Silver and Gold Markets which hurt their exporting countries (Mexico and Australia)….

All these things lead to weaker currencies, hurting us by strengthening the Dollar and killing our exports.

It’s almost as if the US wants a stronger Dollar. Yet in the same breath, Yellen fears it may destroy whatever economic recovery we hope to have.

It’s like we’re moving in opposite directions at the same time!

Go ahead Fed, raise rates on top of the country bashing going on. See what happens.

Stronger dollar, Equity declines, Increased US Treasury funding costs, Lower exports, Burden of corporate indebtedness increases, Bond market collapse, etc.

CIGA Wolfgang Rech

Initial Jobless Claims Plunge To Lowest Level In 42 Years
Submitted by Tyler Durden on 07/23/2015 – 08:37

Time for a rate hike?

Initial jobless claims dropped 26,000 to 255k – its lowest since Nov 1973

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While July 4th adjustments may indeed be a factor, it appears things have hardly ever been better – according to this data anyway.

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Jim,

Someone accumulating silver?

There’s lots of talk about game changing events in October regarding China (gold holdings and Yuan). Also in the USA in September.

The author may have a point.

CIGA Wolfgang Rech

Someone Is Loading Up On Physical Silver Prior To September
July 22, 2015 / Jeff Berwick

Craig Hemke of the TFMetalsReport wrote an interesting article this week titled, “ EPIC Silver Shortage Imminent? 3.5 M Oz of Silver “Jump the Queue” to Take JULY Delivery!”

We won’t get into the fine details of what he reported here as it gets very technical… but if you are interested you can see his article.

But, to summarize, an unknown party is unexpectedly taking delivery of an unprecedented amount of physical silver this month at the Comex.

According to Hemke, “… the Comex is on pace to deliver an additional 700+ over the course of the month? At 5,000 ounces/contract, that means someone or something has ponied up about $50,000,000 in order to “jump the queue” and take immediate delivery of 3,500,000 ounces of silver this month.”

This large, last minute buy of physical silver at the Comex is interesting for two reasons.

First, it comes with gold and silver prices under heavy pressure and dropping.  You would think if the market for silver was this bad people would be looking to divest of physical silver but quite the opposite is happening here.

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Posted at 10:18 AM (CST) by & filed under In The News.

Jim Sinclair’s Commentary

Mr. Williams shares the following with us.

- Gold-Price Manipulations Likely Were Central-Bank Orchestrated; Underlying Reasons for Holding Gold Remain Basic and Strong 
- Revamped Production Fell by 1.0% (-1.0%) in First-Half 2015, Now Down by 0.2% (-0.2%) and 1.7% (-1.7%) Respectively in First-Quarter and Second-Quarter 2015 
- Downwardly-Revised Manufacturing Activity No Longer Has Recovered Its Pre-Recession High 
- Downside Benchmark Revisions to Industrial Production Locked-In General Downside Revisions to GDP Benchmarking 
- New-Home Sales Hit a Post-Recession High but Remained Down by 24% (-24%) from Pre-Recession Peak

"No. 737: Industrial Production Benchmark Revision, Pending GDP Revisions, Gold" 
Web-page: http://www.shadowstats.com

 

Gold Smash Leads to Surge in Demand For Coins, Bars Around World
Submitted by GoldCore on 07/23/2015 06:12 -0400

Gold Smash Leads to Surge in Demand For Coins, Bars Around World

- U.S. Mint sees highest monthly gold eagle sales in over two years
- Indians take advantage of low price in a season not typically known for gold buying
- Chinese investors, disillusioned with stock market, are buying gold in large volumes
- Demand for coins from Perth Mint 37% higher in June and even higher for July

The manipulative smash on the gold price on Sunday night has once again led to a surge of buying of gold coins and bars across the globe. Both the Wall Street Journal and Reuters report on how bullion dealers are seeing a spike in demand for gold coins and bars in  India and China and indeed Europe, Australia and the U.S.

The U.S. Mint – which ran out of Silver Eagles earlier in the month due to unexpectedly high demand – has sold 110,000 Gold Eagle one ounce coins so far this month according to Reuters. This compares with a mere 21,500 ounces sold in May and 76,000 in June. It represents the highest level of monthly demand in over two years – with more than a week to go till the end of the month.

In India, July is typically a quiet month for gold sales as farmers, who make up the bulk of the population, allocate their cash towards cultivation, according to the WSJ. However, the unusually low price has led to a surge of buying.

“Gold’s plunge to five-year lows this week has prompted a swift rise in demand from jewelry retailers in China and India, the world’s top consumers of gold, leading to a doubling of premiums paid on physical gold,” reports the WSJ via Marketwatch.

The article goes on to quote an Indian jeweller:

“Until now, the gold demand was very low because of the season. Demand has picked up noticeably as the common man thinks prices have bottomed out.”

Meanwhile, Chinese investors have been allocating money to gold following the bursting of China’s equity bubble.

Interest in gold “had waned in recent months as investors flocked to the soaring stock market.” The surge in demand has caused a doubling in the premiums paid for gold. Demand for investment type “gold biscuits” has “shot up” this week according to a Hong Kong based jeweller. “Our sales are up by 20% to 30% compared to average sales in previous months.”

The Perth Mint in Australia has also seen a sharp rise in demand for gold coins. In June, sales were up 37% on the same month last year with the mint clearing 21,962 ounces.

“Sales in July already matched that level earlier this week and appear to be gaining momentum,” said Ron Currie,  sales and marketing director.

The Perth Mint sells coins and bars internationally and is seeing strong demand in the U.S. and EU.

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Posted at 1:09 PM (CST) by & filed under In The News.

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Russians Buy Gold In June – Another 25 Tonnes
By Mark O’Byrne

- Russia adds another 800,000 ounces or 25 tonnes to gold reserves in June
- Russia’s has sixth largest gold reserves in the world
- Allocates 13% of FX reserves to gold
- Central bank buys all Russian gold production
- Other Russian gold demand imported
- If billionaire oligarchs diversify into gold, prices will rise sharply
- Russia views gold bullion as “100% guarantee from legal and political risks”

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With all the focus on the Chinese lowballing their total institutional gold holdings, combined CIC, SAFE and PBOC, this week and the continuing attacks and manipulation of the gold market on Sunday night, the latest large increase in Russia’s gold reserves has gone largely unnoticed and barely covered by commentators – especially the more vocal bearish ones.

Russia continues to add to its gold reserves and added another 800,000 ounces in June or another 25 metric tonnes, and analysts believe this buying will continue in the coming months.

Its total gold reserves now amount to 41 million ounces or around 1,275 metric tonnes, with a current value of just $48 billion. Russia’s total FX reserves are $362 billion and their gold allocation is now 13% of their total reserves.

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Bill Fleckenstein – Violent Reversal Coming As Available Physical Gold Disappearing – Fred Hickey On The Gold Plunge, Plus A Bonus Q&A
July 20, 2015

On the heels of the 2 minute $50+ plunge in the gold price, today one of the greats in the business sent King World News a fantastic piece predicting a violent reversal in the gold market as available physical inventories of gold are disappearing.  Fred Hickey also weighs in on the gold plunge, plus a remarkable bonus Q&A that covers the gold smash and much more.

By Bill Fleckenstein President Of Fleckenstein Capital

July 20 (King World News) – Overnight the financial markets were largely uneventful, though that wasn’t the case for commodities (more about that below). As for our stock market, the early going saw the indices modestly higher, with the high-priced (i.e., valuation, not absolute), momentum-oriented, "growth-y" sorts of names driving the Nasdaq.

The early strength led to a bit more and the Nasdaq gained about 0.5%, with the Dow/S&P lagging until the last hour, when the rally fell apart and the market closed flattish. Away from stocks, green paper was mixed in rather dull trading, oil lost a percent, fixed income was lower, but, as I noted, the real action was in the commodity complex….

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Jim Sinclair’s Commentary

You can take it out but you cannot send it out.

Greek banks re-open today, and a lot of people are psyched to get back into their deposit boxes
Lefteris Papadimas, Reuters
Jul. 19, 2015, 2:35 PM

*Excerpts from article*

“Deposit boxes are not affected by the capital restrictions and clients can therefore take whatever they want from them, bank officials said. But restrictions on transfers abroad and other capital controls remain in place.”

"The banks are ready and they will open all their branches on Monday," a senior official at Piraeus Bank , Greece’s second-largest bank by assets, told Reuters.

"There might be queues because many people will want to withdraw money from their deposit boxes."

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