We posted this article over the weekend… and they call us the crazies? Let’s look at this from a very broad standpoint because if anything displays where we are as a world, financial and otherwise is captured right here!
So, a bond offering with “the worst ever” covenants is three times oversubscribed causing a repricing with less discount and lower yield than originally offered? Is this important? Is it company or industry specific? Or, is it an illustration of something far larger and systemic? I would argue the problem is definitely systemic and certainly a symptom of “mob madness”.
Forget about company or industry specific because as it stands now, over $9 trillion worth of debt all over the world sits with negative yields! We won’t go over the topic of negative interest rates again (as we have several times in the past), because even a 6 year old understands it makes no sense and is untenable from a systemic standpoint. Suffice it to say, a snake can never eat its own tail and live to talk about it.
The manipulators of paper gold can temporarily do anything. The operative word there in being temporarily.
The equation is gold versus run away insane debt levels, plus now we see QE in its true GLOBAL form as to INFINITY.
YOU NEED TO MAKE YOUR DECISION AND NOT OVER-INTELLECTUALIZE IT.
Do you really believe that fiat paper will maintain, and therefore store the value of what you have? Sorry, it simply will not.
As such GOLD is your savings account.
End of story!
Jim
Jim,
With this capital adjustment coming for gold on March 29, I have been wondering if we will see another April 2013 swoon or whether. as everyone is hoping. that maybe a floor will be established on the gold market. I fear the floor may be manipulated much lower on the “financial” instrument that they call gold.
What do you think?
The BIS ruling states that Central banks and commercial banks will necessarily value their “financial” and real gold at market price. Is this just a way to increase the collateral value of paper or physical gold even as market value declines?
Unless the March 29 ruling has an immediate effect on auditing of physical gold held by CB’s, I fear it is another scheme to push gold prices lower. And so far I am not hearing anything with regards to a global gold audit of CB’s. And China continues to sleep.
As Ronan Manly pointed out, the reason the Fed values its gold on its asset side at only $42 per ounce is because the gold is valued at book value by the Treasury and the Fed’s gold is actually only gold certificates valued at no more than the statutory price of their issuance in 1934 which matches the book value of the Treasury gold. Will the Treasury revalue its physical gold at FRBNY and Fort Knox? Will the Treasury allow the Fed’s gold certificates to be valued at market? What are the implications if they don’t?
Instruments comprise financial instruments, foreign exchange (FX), and commodities. A financial instrument is any contract that gives rise to both a financial asset of one entity and a financial liability or equity instrument of another entity. Financial instruments include primary financial instruments (or cash instruments) and derivative financial instruments. A financial asset is any asset that is cash, the right to receive cash or another financial asset or a commodity, or an equity instrument. A financial liability is the contractual obligation to deliver cash or another financial asset or a commodity. Commodities also include non-tangible (ie non-physical) goods such as electric power.
Kevin
Jay Taylor refers to you here Jim.
Bill
Jay Taylor: Under “Basel III” Rules, Gold Becomes Money! March 17, 2019
Excepted from Jay Taylor’s latest newsletter,
. . .
This also raises the question with regard to how much gold the U.S. actually holds as opposed to what it claims to hold. James Sinclair has always argued that the only way the world can overcome the debt that is strangling the global economy is to remonetize gold on the balance sheets of central banks at a price in many thousands of dollars higher. This would mean a major change in the global monetary system away from the dollar, as China has been pushing for the last decade or so.
If banks own and possess gold bullion, they can use that asset as equity and thus this will enable them to print more money. It may be no coincidence that as March 29th has been approaching banks around the world have been buying huge amounts of physical gold and taking delivery. For the first time in 50 years, central banks bought over 640 tons of gold bars last year, almost twice as much as in 2017 and the highest level raised since 1971, when President Nixon closed the gold window and forced the world onto a floating rate currency system.
Lawsuit By Sandy Hook Victims Against Gun Manufacturer Allowed To Move Forward March 14, 2019
After months of silence, the Connecticut Supreme Court on Thursday reinstated a wrongful death lawsuit filed by the families of nine victims of the Sandy Hook Elementary School shooting against Remington Arms, the manufacturer of the rifle used in the shooting.
The court’s narrow decision, overturning a lower court judge, rules that Remington can be sued over its marketing practices under a Connecticut state law, despite protections offered to gun manufacturers by federal law. The ruling sends the case back to the lower court.
The suit is a high-stakes challenge to gun companies, which have rarely been held liable for crimes committed with their products, and could mark a new front in the battle over gun regulations and corporate accountability. It centers on the Protection of Lawful Commerce in Arms Act (PLCAA), a 2005 law that shields manufacturers and retailers from civil liability in lawsuits brought by victims of gun violence. An eventual ruling against Remington could establish legal precedent, opening doors for more lawsuits against gun manufacturers, and expose the company’s communications about its marketing plans.
Why Gold Is Still The Best Basis For Money March 16, 2019
As we continue to enjoy the “Yellen gold standard,” now in its Powell phase — who knows how long it will last — let’s look at why the gold standard system worked so well for so many centuries, including nearly two centuries of U.S. history before the rupture in 1971, during which time the United States became the wealthiest country in the history of world.
In 1971, the economist Arthur Laffer — he was the chief economist of the Office of Management and Budget at the time — was asked what he thought the consequences would be of Nixon’s “closing of the gold window,” which effectively ended the Bretton Woods period when the dollar’s value was fixed at $35/ounce of gold.
“It won’t be as much fun to be an American anymore,” Laffer reportedly replied. And he was right.
But why? Why is it that the collective intelligence (let’s be generous) of today’s central bankers, and indeed all the central bankers since 1971, cannot outperform a yellow rock? This probably strikes some as bizarre, but it has always been thus. Way back in 1928, in a book called The Intelligent Woman’s Guide to Socialism and Capitalism, George Bernard Shaw declared:
– Consumption/Manufacturing Downturn Driven by Consumer Liquidity Woes
– Weakening Industrial Production, Manufacturing and Capacity Utilization Were Consistent With a Pending Downside Revision to Fourth-Quarter 2018 GDP and Signaled High Odds of a First-Quarter 2019 GDP Contraction
– These Data Reinforced Similar Negative Revisions Seen With Earlier Indicators, Including: Retail Sales, Housing, Construction and Payrolls
– February Housing Starts (March 26th), January Trade Deficit (March 27th) and An Eviscerated Annual Industrial Production Benchmarking (March 27th) Are the Last Major Reports, Prior to the March 28th Final GDP Estimate; There Is Limited Chance of a Reprieve
– The Economy Is Weakening Sharply and Quickly, Due to the Overly Aggressive Federal Reserve Tightening and Rate Hikes
– Where Current U.S. Economic Activity Has Signaled a New Recession, Major Business Sectors, Such as Manufacturing and Construction, Never Recovered Fully from the Last One
– Accordingly, the March 20th FOMC Meeting Is Not Too Early to Address the Intensifying Business Collapse; Yet, the FOMC Is Expected to Sit on Its Hands
Bonds With “Worst-Ever Covenants” Are 3x Oversubscribed March 15, 2019
Just how much investor appetite is there for bonds? So much, that even in a week that saw the second biggest equity inflow on record (after a 13 week drought) buying of bonds continued for a 10th consecutive week, rising to $7.01bn from $2.74bn the week prior.
This flood into fixed income continues despite repeated warnings about the dangers of the corporate debt bubble from such investing icons as DoubleLine’s Jeff Gundlach and Marathon’s Bruce Richards, not to mention the IMF and BIS, who have been focusing on the growing risk of mass downgrades in the $3 trillion BBB-space, which could translate into a tsunami of fallen angels during the next recession.
The Millennial Falcon (Ag/AU) Returns on the Ides of March March 15, 2019
Good Friday Morning Folks,
Welcome to the early Morning Reversal where Gold turned on the shorts the very next day with the price now above the ($1,300) Maginot line at $1,303.20, up $8.10 and with the usual, close to the high of $1,304.30 with a low at $1,293.70. Silver is leading the charge (ok, barely) with its trade at $15.36, up 19 cents and only 3 cents off its high with a low at $15.165. It’s still NOT about the Dollar or our economic conditions or if it is, then the Algos are in some sort of funk with the US$’s trade at 96.675, down only 9.4 points with a low at 96.585 and the high at 96.775. All of this activity was done around 5 am pst and still before the Comex open. The Venezuelan calculations for Gold’s price now shows a value at 13,015.71 Bolivar, regaining some 51.93 overnight with Silver’s price now at 153.408, et tu (apropos for today’s Ide’s of March) regaining 1.198 Bolivar.
The March Silver Delivery Cycle carries on with the count now at 75 demands for physical with Zero Volume up on the board so far this morning, proving a drop of 122 contracts being settled out somewhere between here and that City in Chaos, England. At least the Overall Open Interest is proving something as the count lost another 1,240 contracts during yesterday’s pump and dump scheme giving us a total count of 187,171 Overnighters still in trade.
There are many approaches to Pumping and Dumping, one way to go is to remove a batch of short positions just before the closing count and then re-enter these positions during the next day’s trades (pumping and dumping) but then clear out more contracts just before the closing count is done again. This would also explain the High Volume count James Mc, from Le Metro Pole Café fame, talks about during the sleeping period the moment COMEX opens. I’m not saying this is happening, I’m just saying there are many possibilities which we will solve in time as the Ides of March moves on.
You, Bill and I were all in agreement that Tariffs and Trade Wars would not be good policy. Too bad the administration did not listen-in to our Saturday talks.
Dave
Cohn Slams Former White House Colleagues: “I Don’t Want To Live In Chaos” March 14, 2019
Former White House chief economic advisor Gary Cohn, who quit in a huff over Trump’s tariffs on steel and aluminum, has lashed out at some of his former colleagues in a Wednesday interview with Freakonomics Radio.
Cohn slammed National Trade Council director Peter Navarro and Commerce Secretary Wilbur Ross for leading the country into an unnecessary trade war.
“Tariffs don’t work. If anything, they hurt the economy because if you’re a typical American worker, you have a finite amount of income to spend,” the former Goldman Sachs #2 executive told host Stephen J. Dubner. “If you have to spend more on the necessity products that you need to live, you have less to spend on the services that you want to buy.”
When interviewer Stephen J. Dubner suggests that all other economists except for one — Navarro — would agree on that point, Cohn said, “There’s only one in the world. That we know of.” –CNBC
This article is long but I hope every one takes the time to read it and then they will understand why alternative media like “JSMineset” is so important.
Dave
The CIA and the Media: 50 Facts the World Needs to Know January 30, 2018
This article by Professor James Tracy first published in August 2015 is of particular relevance in relation to the “fake news” campaign directed against the alternative and independent media.
In a bitter irony, the media coverup of the CIA’s covert support to Al Qaeda and the ISIS is instrumented by the CIA which also oversees the mainstream media.
Since the end of World War Two the Central Intelligence Agency has been a major force in US and foreign news media, exerting considerable influence over what the public sees, hears and reads on a regular basis. CIA publicists and journalists alike will assert they have few, if any, relationships, yet the seldom acknowledged history of their intimate collaboration indicates a far different story–indeed, one that media historians are reluctant to examine.
When seriously practiced, the journalistic profession involves gathering information concerning individuals, locales, events, and issues. In theory such information informs people about their world, thereby strengthening “democracy.” This is exactly the reason why news organizations and individual journalists are tapped as assets by intelligence agencies and, as the experiences of German journalist Udo Ulfkotte (entry 47 below) suggest, this practice is at least as widespread today as it was at the height of the Cold War.
Another Government agency that may not have public safety first and foremost on its mind.
Dave
NASA Warns Hurricane Forecasts May Revert To 1970 Accuracy Due To 5G Conflict March 14, 2019
Authored by Mike Shedlock via MishTalk
. . .
The FCC’s Brian Hart said the plan to auction this spectrum has “been on the books since 2007” and that “it is therefore perplexing to be asked to postpone this auction the day before it is going to start.”
The request was made last week, not the day before. But yes, that is the last minute in a manner of speaking.
Regardless, what the hell is the priority here?
If there is a strong chance public safety is at risk, as seems the case, it is idiotic to suggest it is too late to make a change.
The FCC should hold off on auctioning this portion of the spectrum or at least widen the spread between to reduce chance of interference.
“Sorry, it’s too late to be concerned about lives” seems to be the message.
Silver Is Hated By The Empire As Much As The Millennial Falcon March 14, 2019
Great and Wonderful Thursday Morning Folks,
Gold is down this morning with the trade doing exactly the opposite of what it should, with the price now at $1,298, once again below that ($1,300) Maginot line with the London Low right there at $1,295.70 with the high to beat (and it will in time) at $1,310.30. Silver is equally punished for being part of the global economic barometer that works regardless of the game with its trade at $15.24, down 21.6 cents and, of course, right beside the low of $15.21 and the high at $15.47. None of this activity is about the US Dollar or our nation’s weakness within the arena of economics and finance, the Dollar’s value is up 25.3 points, just because of Britain, with the value pegged at 96.765, close to the high at 96.805 with the low that needs to drop a hell of a lot more at 96.475. Of course, all this had to be done while we sleep and while Britain ignores its voters.
Our Venezuelan example of too much printed fiat is showing Gold’s conversion price at 12,963.78 Bolivar, taking back about 87.89 Bolivar from yesterday’s huge gains with Silver now at 152.210 losing even more than it gained yesterday now totaling a loss of 2.546 Bolivar overnight. No matter what currency Silver is calculated under, it is equally as hated by the Empire as much as the Millennial Falcon has been in the Star Wars movies over all these decades. One thing for certain, Silver and Gold will never go away because they are real and the biggest pain in the ass for the failing fiat empire.
In my opinion, the sad answer to the question would be no.
Dave
The College Admissions Scandal Is A Perfect Example Of How Deeply Corrupt America Has Become March 14, 2019
Is there anything left in this country that has not been deeply tainted by corruption?
By now you have probably heard that dozens of people have been arrested for participating in a multi-million dollar college admissions scam. Enormous amounts of money were paid out in order to ensure that children from very wealthy families were able to get into top schools such as Yale University, Stanford University, the University of Texas and the University of Southern California. And as The Economic Collapse blog’s Michael Snyder writes, we should certainly be disgusted by these revelations, but we shouldn’t be surprised. Such corruption happens every single day on every single level of society in America. At this point our nation is so far gone that it is shocking when you run into someone that actually still has some integrity.
The “mastermind” behind this college admissions scam was a con man named William Rick Singer. He had been successfully getting the kids of wealthy people into top colleges for years using “side doors”, and he probably thought that he would never get caught.
Looks like the revolving door between Big Business and Government.
Dave
Trump’s Defense Secretary Faces Ethics Complaint Over Boeing Promotion March 13, 2019
A government watchdog group has asked the Department of Defense Inspector General to investigate whether Acting Secretary of Defense Patrick Shanahan violated ethics rules by promoting Boeing weapons systems while serving as a government official.
Shanahan, 56, worked at Boeing for more than 30 years prior to being tapped by President Donald Trump to serve as deputy secretary of defense under former Defense Secretary Jim Mattis. When Mattis submitted his resignation in December, Shanahan was named by Trump as acting defense secretary.
Since coming to the Pentagon, Shanahan has faced criticism over reports that he has touted Boeing’s line of aircraft over rival Lockheed Martin. In the fiscal year 2020 budget released Tuesday, the Air Force is set to purchase up to 80 F-15Xs over the next five years — a system, made by Boeing, that the Air Force has said it does not want.
What come first, the safety of the flying public or propping up the stock market with share buy backs?
Dave
Cancellation Chaos: $600 Billion In Boeing 737 Max Orders At Risk March 14, 2019
New evidence shows that the Boeing Co. 737 MAX which crashed in Ethiopia on Sunday may have experienced similar technical difficulties as the 737 MAX that crashed off Indonesia last year. The Federal Aviation Authority (FAA) cited similarities with in-flight data of both planes when it spoke to global regulators about grounding the jet. With the company facing a pr disaster and loss of confidence with global airline carriers, there could be more than $600 billion in orders at risk of cancellation, reported Bloomberg.
VietJet Aviation JSC doubled its 737 MAX order last month to $25 billion, now the Vietnamese low-cost airliner is having second thoughts. Kenya Airways Plc is reviewing its contracts to purchase billions of dollars of the MAX and could even switch to Airbus SE’s rival A320. Russia’s Utair Aviation PJSC is expected to take delivery of 30 MAXs but wants to seek guarantees the planes are not defective.
