Mexico

GoldCore's picture

Gold “Buying Opportunity” - Gold Analysts More Bullish On Central Bank Demand





The Fed’s promise to use more QE should the economy falter is supporting gold.

 

The global economic picture remains grim, with euro zone economic sentiment falling more than

expected in April and the US job market recovery showing signs of a slowdown.

 

Apple earnings and the tech boom and indeed possible tech bubble remains one of the primary

drivers of continuing irrational exuberance and risk appetite.

 

The poor and deteriorating economic backdrop is gold supportive.

 
Tyler Durden's picture

Frontrunning: April 25





  • Merkel Pushes Back Against Hollande Call to End Austerity Drive (Bloomberg)
  • ECB's Draghi throws crisis ball back to governments (Reuters)
  • Greek Bank Chief Warns of a Possible Euro Exit (WSJ)
  • China’s Wen Says Economy Will Maintain Robust Expansion (Bloomberg)
  • North Korea's nuclear test ready "soon" (Reuters)
  • Hong Kong Peg Architect Says Convertible Yuan `Long Way Off’ (Bloomberg)
  • Hollande seeks wider EU fiscal pact (FT)
  • Gavyn Davies: Why UK GDP continues to lag the G7 (FT)
  • U.S. Lost AAA on Danger of Liquidity Crisis, S&P’s Kraemer Says (Bloomberg)
 
Tyler Durden's picture

The US Has Finally Done It: Mexican Immigrants Become Emigrants





You know its bad when...the net flow of Mexicans into the US has fallen so much that there is a high probability that it is now in reverse ending around forty years of inward migration. The Pew Hispanic Center notes that the standstill - after more than 12 million current immigrants have entered the US - more than half of whom are illegal - appears to be the result of many factors including a weakened US job and construction market, tougher border enforcement, a rise in deportations, growing dangers associated with border crossing, a long-term decline in Mexico's birth rate, and changing (read perhaps more opportunistic) economic conditions in Mexico (especially if you work at WalMex). This sharp downward trend in net migration has led to the first significant decrease in at least two decades in the number of unauthorized Mexican immigrants living in the U.S. - to 6.1 million in 2011, down from a peak of nearly 7 million in 2007. In the five years from 2005 to 2010, about 1.4m Mexicans immigrated to the US – exactly the same number of Mexican immigrants and their US-born children who quit the US and moved back or were deported to Mexico. By contrast, in the previous five years to 2000 some 3m Mexicans came to the US and fewer than 700,000 left it. It will be interesting to see the spin that the Obama and Romney camps put on this hot-button topic as the 'Dream Act' turns into a nightmare and hardline anti-illegal immigration stances become, well, less relevant as Mexicans become Mexican'ts.

 
Tyler Durden's picture

Russia And Mexico Both Buy Nearly $1 Billion Worth of Gold in March





While gold demand from the western investors and store of wealth buyers has fallen in recent months, central bank demand continues to be very robust and this is providing strong support to gold above the $1,600/oz level. IMF data released overnight shows that Mexico added 16.8 metric tons of gold valued at about $906.4 million to its reserves in March. Russia continued to diversify its foreign exchange reserves and increased its gold reserves by about 16.5 tons according to a statement by its central bank on April 20. Other creditor nations with large foreign exchange reserves and exposure to the dollar and the euro including Turkey and Kazakhstan also increased their holdings of gold according to the International Monetary Fund data.Mexico raised its reserves to 122.6 tons last month when gold averaged $1,676.67 an ounce.Turkey added 11.5 tons, Kazakhstan 4.3 tons, Ukraine 1.2 tons, Tajikistan 0.4 ton, and Belarus 0.1 tonnes, according to the IMF. Ukraine, Czech Republic and Belarus also had modest increases in their gold reserves. Central banks are expanding reserves due to concerns about the dollar, euro, sterling and all fiat currencies.

 
Tyler Durden's picture

Frontrunning: April 24





  • China’s Biggest Banks Are Squeezed for Capital (NYT)
  • Greeks detect hypocrisy as Dutch coalition stumbles (Reuters)
  • Hollande Blames Europe’s Austerity Plan for Le Pen’s Rise (Bloomberg)
  • In a Change, Mexico Reins In Its Oil Monopoly (NYT)
  • China Tire Demand Slows as Economy Decelerates, Bridgestone Says (Bloomberg)
  • Social Security’s financial forecast gets darker; Medicare’s outlook unchanged (WaPo)
  • Fed’s 17 Rate Forecasts May Confuse More Than Clarify (Bloomberg)
  • Senate to vote on array of Postal Service overhaul proposals (WaPo)
  • Weidmann Says Bundesbank Is Preserving Euro Stability (Bloomberg)
 
Tyler Durden's picture

Frontrunning: April 23





  • A Forecast of What the Fed Will Do: Stand Pat (Hilsenrath) - they finally realized that they have to leak the opposite...
  • Draghi's ECB Rejects Geithner-IMF Push for More Crisis-Fighting (Bloomberg)
  • Wal-Mart's Mexico probe could lead to departures at the top (Reuters)
  • The Sadly Unpalatable Solution for the Eurozone (FT)
  • US Regulators Look to Ease Swaps Rules (FT)
  • Yuan, Interest Rate Reform to be Gradual: China Central Bank Chief (Reuters)
  • Run, Don't Walk (Hussman)
  • Hollande Steals Poll March on Sarkozy (FT)
 
Tyler Durden's picture

Guest Post: How To Speculate Your Way To Success





So far, 2012 has been a banner year for the stock market, which recently closed the books on its best first quarter in 14 years. But Casey Research Chairman Doug Casey insists that time is running out on the ticking time bombs. Next week when Casey Research's spring summit gets underway, Casey will open the first general session addressing the question of whether the inevitable is now imminent. In another exclusive interview with The Gold Report, Casey tells us that he foresees extreme volatility "as the titanic forces of inflation and deflation fight with each other" and a forced shift to speculation to either protect or build wealth.

 
Tyler Durden's picture

The Risk Of 'Hot' Inflation





Ideological deflationists and inflationists alike find themselves both facing the same problem. The former still carry the torch for a vicious deflationary juggernaut sure to overpower the actions of the mightiest central banks on the planet. The latter keep expecting not merely a strong inflation but a breakout of hyperinflation. Neither has occurred, and the question is, why not? The answer is a 'cold' inflation, marked by a steady loss of purchasing power that has progressed through Western economies, not merely over the past few years but over the past decade. Moreover, perhaps it’s also the case that complacency in the face of empirical data (heavily-manipulated, many would argue), support has grown up around ongoing “benign” inflation. If so, Western economies face an unpriced risk now, not from spiraling deflation, nor hyperinflation, but rather from the breakout of a (merely) strong inflation. Surely, this is an outcome that sovereign bond markets and stock markets are completely unprepared for. Indeed, by continually framing the inflation vs. deflation debate in extreme terms, market participants have created a blind spot: the risk of a conventional, but 'hot,' inflation.

 
Tyler Durden's picture

Visualizing Aubrey McClendon "Rehypothecation" Scheme... And The China Trail





Aubrey McClendon is no amateur when it comes to shady personal transactions involving his company, nat gas giant Chesapeake: Back in October 2008, just after the financial crisis erupted, he was forced to sell more than 31 million Chesapeake shares for $569 million to cover margin calls generated from buying CHK stock just prior on margin. The company’s stock fell nearly 40 percent the week of McClendon’s share sales. McClendon issued an apology but the company’s credibility with many shareholders suffered significantly. It looks lie the story is repeating itself, only this time the margined security is not company stock, but company loans. As Reuters reports in a must read special report "Since he co-founded Chesapeake in 1989, McClendon has frequently borrowed money on a smaller scale by pledging his share of company wells as collateral. Records filed in Oklahoma in 1992 show a $2.9 million loan taken out by Chesapeake Investments, a company that McClendon runs. And in a statement, Chesapeake said McClendon’s securing of  such loans has been “commonplace” during the past 20 years. But in the last three years, the terms and size of the loans have changed  substantially. During that period, he has borrowed as much as $1.1 billion – an amount that coincidentally matches Forbes magazine’s estimate of McClendon’s net worth." Ah yes, net worth calculations, which always focus on the assets, but endlessly ignore the liabilities (as Donald Trump will be first to admit). But ignore that: what is more notable here is the circuitous way that McClendon basically lifted himself by his, or rather CHK's bootstraps: all the loans are collateralized by his 2.5% working interest in new CHK wells drilled every year. In essence a roundabout way of generating "cash" by hypothecation, and levering into an "upside" corporate case. Should CHK however incur asset impairments, and/or if the current price of gas stays at or $2.00, then not only will CHK be gutted but so will the asset quality securing the private loans to the CEO, which on top of everything have no covenants ("There are no covenants or obligations in my loan documents or mortgages that bind Chesapeake in any way," McClendon wrote in an email to Reuters.) and thus no stakeholder protections. Is it any wonder then that CHK is getting creamed as of right now as investors are once again reminded that CHK may not quite play by the rules?

 
Tyler Durden's picture

Guest Post: When Does This Travesty Of A Mockery Of A Sham Finally End?





We all know the Status Quo's response to the global financial meltdown of 2008 has been a travesty of a mockery of a sham--smoke and mirrors, flimsy facades of "recovery," simulacrum "reforms," and serial can-kicking, all based on borrowing and printing trillions of dollars, yen, euros and yuan, quatloos, etc. So when will the travesty of a mockery of a sham finally come to an end? Probably around 2021-22, with a few global crises and "saves" along the way to break up the monotony of devolution.

 
Bruce Krasting's picture

Three Conversations





So let's talk Greece, Paris and Natural Gas. 

 
Tyler Durden's picture

Are The BRICs Broken? Goldman And Roubini Disagree On China





While most of the time, it seems, investing in Emerging (or Growth) market countries is entirely focused on just that - the growth - with little thought given to the lower probability but high impact event of a growth shock. Goldman uses a variety of economic and corporate factors to compile a Growth Vulnerability Score including excess credit growth, high levels of short-term and/or external debt, and current account deficits. Comparing growth expectations to this growth shock score indicates the BRICs are now in very different places from a valuation perspective. Brazil remains 'fair' while India looks notably 'expensive' leaving China and Russia 'cheap'. It seems, in Goldman's opinion that markets are discounting large growth risks too much for China and Russia (and not enough for India). Finally, for all the Europeans, Turkey is richest of all, with a significant growth shock potential that is notably underpriced. Goldman's China-is-cheap perspective disagrees with Nouriel Roubini's well-below-consensus view of an initially soft landing leading to a hard landing for China as 2013 approaches as he notes the pain that commodity exporters feel in 2012 is only a taste of the bleeding yet to come in 2013.

 
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