Something has changed. We have become used to the daily beat down on precious metals at around the 8am-9amET period... but the last two days have seen a significant reverse of that... Silver (and gold) are pushing notably higher once again this morning...
Greece must pay $3.8 billion to the IMF over the course of the next month and most analysts believe they will not be in a position to do so unless they can access the outstanding $7.2 billion in funds that form part of the existing program. Ukraine have also been flirting with a default.
Following yesterday's early MNI rumor that a Chinese QE is being "considered" and which sent the Shanghai Composite surging 3% and led to an initial boost in US stock futures, overnight the PBOC scrambled to once again deny such speculation. Of course, going full "cold Turkey" on Chinese stimulus would be too much for the market to handle, so in a piece by the WSJ also released overnight, the author said the PBOC would pivot from outright QE to mere LTRO, which is also not new and was reported over a week ago here in "China Floats QE Trial Balloon, PBoC May Launch LTROs." In any event, for now at least, Asian stocks are not happy despite Apple's latest blockbuster results, and neither is Europe, with the Stoxx 600 down 1%, and even the E-mini is hugging 2100 unable to levitate on any imminent central bank intervention.
While sentiment towards gold in the West is abysmal - even as gold languishes at record lows when adjusted for inflation - Asian demand remains insatiable. It would be wise for investors to inform themselves as to why this should be so. Demand for gold in Asia is often written off by Westerners as an irrational impulse of uneducated Asian peasant farmers and workers.
It has been a story of two markets so far, with China's Shanghai Composite up another 3% in today's continuation of the most ridiculous, banana-stand driven move of the New Normal (and there have been many ridiculous moves in the past 6 years) on the previously reported hints that the PBOC is gearing up to start its own QE, while Europe and the Eurostoxx are lagging, if only for the time being until Citadel and Virtu engage in today's preapproved risk-on momentum ignition, on Greek jitters, the same jitters that last week were "fixed"and sent Greek stocks and bonds soaring. Needless to say, neither Greek bonds nor stocks aren't soaring following what has been the worst week for Greece in months.
The day after the crash (and thereafter), what will be the currency that is used to buy a bag of groceries, a tank of petrol, a meal at a restaurant? Certainly, the need will be immediate and will be on a national level in each impacted country, affecting everyone. Many believe the US will be prepared ahead of time with a new, electronic currency - US citizens will then become the most economically controlled people in the world, overnight. A further possibility is taking place in Mexico today. Mexico is remonetising silver. As the Great Unravelling proceeds, we would be wise to monitor what happens with the Libertad in Mexico and watch for a similar return to precious metals in other jurisdictions.
All problems, all crises, have at least one solution, if not many solutions. There is no such thing as an unwinnable scenario. Some may not be smart enough or courageous enough to see it, but the solution is always there, waiting to be discovered. The only fight that cannot be won is the fight in which the enemy makes all the rules and we foolishly abide by those rules. Life is not a game of chess, and a man can choose to be more than a pawn anytime he has the guts to do so. Collapse is already upon us; now we must decide who will determine what happens next.
Claiming to own X quantity of gold is one thing, and reporting how many times the gold has been pledged as collateral is another.
I would like to make my own modest effort to put to rest a trite little phrase that gets trotted out every time silver and gold are getting trashed.
The Saudi bombing of Yemen is another flash point and will deepen tensions between the U.S., NATO allies and Russia and indeed China. Geopolitical risk remains high and the region remains a powder keg that is likely to explode as has already been seen in Syria and much of North Africa.
Today is shaping up to be a rerun of yesterday where another frenzied Asian session that has seen both the Shanghai Composite and the Nikkei close higher yet again (following the weakest Chinese HSBC mfg PMI in one year which in an upside down world means more easing and thus higher stocks) has for now led to lower US equity futures with the driver, at least in the early session, being a statement by the BOJ's Kuroda that there’s a "possibility" the Bank of Japan’s 2% inflation target will be delayed and may occur in April 2016.
Authorities have located one of the gold bars stolen last month in what was the eleventh-largest gold heist in history. Police now suspect the robbery may have been an inside job.
Just days after Russia lifts sanctions on Iran and prepares to send its S-300 missile defense system, it appears Washington has retaliated. As TASS reports, Poland - on Russia's doorstep - has decided to buy the US Patriot air-defense system (made by Raytheon) for a total cost of around $9bn: "The US proposal has been found to be more profitable from the viewpoint of Poland’s security and implementation of commitments within NATO framework." Washington, keen to ensure Warsaw signed up with Raytheon, has decided to loan Poland a battery of Patriots until the deal is signed.
Many have forecast the creation of a new monetary system by which governments and banks gain total control over all monetary transactions. On the surface of it, this may seem an impossible goal, as it would be so all-encompassing and would eliminate economic freedom entirely. Surely, it would not be tolerated. However, we believe that it’s not only relatively easy to create, but it will be sold in such a way that the public will see it as an absolute panacea to their economic woes. Only those who are far-sighted will understand its level of destruction in advance of its implementation.
It is only fitting that the next business day following a headline that "Global Futures Slide China Tumbles On Short Selling Boost" we would see China, in an apparent panic, not only cut its RRR by 100 bps to 18.5% - far more than expected and the most since 2008 - but, more importantly, hinted that the Friday regulatory decision to encourage short sales and tighter margin rules on "umbrella trusts" was in no way meant to pop that the Chinese stock bubble, ridiculous as it may be. End result: after Chinese futures crashed by up to 6% on Friday after the Shanghai close, overnight the SHCOMP was down just 1.64%, erasing the bulk of the futures loss. More importantly, US equity futures have seen a strong bid this morning in yet another attempt to defend not only the Apple Sachs Industrial Average from going red on the year but the all important 100 DMA technical levels.