- China Output Growth Slows as Leadership Handover Looms (Bloomberg); Weak China trade data raises Beijing spending stakes (Reuters)
- Italy Q2 GDP revised down to -0.8% year-on-year on weak domestic demand (Economic Times)
- Troika disagreed with €2 billion in Greek "cuts" (Reuters)
- No Greek bottom in sight yet: Greek IP, Manufacturing Output plunge compared to year earlier (WSJ)
- France's Hollande sees 2013 growth forecast about 0.8 pct (Reuters), France plots tax hikes of up to 20 bln euros (Reuters)
- Euro Crisis Faces Tests in German Court, Greek Infighting (Bloomberg)
- Geithner sells more AIG stock (FT)
- Japan infuriates China by agreeing to buy disputed isles (Reuters)
- Euro crisis to worsen, Greece could exit euro: Swedish FinMin Anders Borg (Economic Times)
- ‘Lead or leave euro’, Soros tells Germany (FT)
- German MP makes new court complaint against euro plans (Reuters)
- Obama super-Pac in push to raise $150m (FT)
XAU/EUR Exchange Rate Daily - (Bloomberg)
Gold at €1,355/oz, just 2.5% from the record high of €1,390/oz, is a sign of a continuing lack of trust in the euro and in Draghi’s stewardship at the ECB.
Prevent WWIII (Which Would Be Really Bad for Your Investment Portfolio, Notwithstanding Keynesian Thinking) by Learning this Little-Known Secret of History
So what's driving these high ass oil prices? Fundamentals, paper pushing derivatives, fraud, or fear? A common sense discussion ensues...
Where is the bacon, Mrs. Clinton?
And NOTHING Has Changed ...
Back in early July we wrote that contrary to expectations, veteran Middle Eastern aircraft carrier CVN-74 Stennis would end its shore leave far earlier than expected, and be redeployed back to its usual stomping grounds just off Iran months ahead of schedule. As of days ago, the Stennis has quietly departed Naval Base Kitsap-Bremerton and is off. It will join CVN-65 Enterprise (which is doing its last tour of duty ever before being decommissioned) and CVN-69 Eisenhower in the Arabian Sea, aka off the coast of Iran. This will be one of the only times in history when the US has had three aircraft carriers in close proximity to those evil Iranians who are hell bent on global domination. Expect Stennis to reach Iran (and be available to support an Israeli attack of Iran) in the last third week of September. Then determine when the next full/new moon is following the arrival of Stennis at its destination, and buy Brent calls just ahead. Finally, profit.
The heightening tension between the United States government and Iran’s is based off of the fallacious notion that nuclear weapons have a legitimate purpose outside of killing enormous amounts of people. Yet they have no other real purpose in the end. Governments possess nuclear weaponry because there is little recourse for state-sanctioned murder. The millions of innocent lives that stand to be vanquished off the face of the Earth have little meaning to the power-tripping political elite. So while the Iranian government’s pursuance of nuclear weapons should be condemned, the United States government, the Israeli government, and others capable of waging nuclear war are in no place to criticize.
Gold’s seasonality is seen in the above charts which show how March, June and October are gold’s weakest months with actual losses being incurred on average in these months. Buying gold during the so-called summer doldrums has been a winning trade for most of the last 34 years. This is especially the case in the last eight years as gold averaged a gain of nearly 14% in just six months after the summer low. We tend to advise a buy and hold strategy for the majority of clients. For those who have a bit more of a risk appetite, an interesting strategy would be to buy at the start of September, sell at end of September and then buy back in on October 31st.
- Romney Promises to 'Restore' U.S. (WSJ)
- Dirty Harry Makes Surprise Appearance (WSJ)
- It has always been about the gold: Time for eurozone to reach for the gold reserves? (FT)
- EU Plan Said to Give ECB Sole Power to Grant Bank Licenses (Bloomberg)
- More attempts to marginalize Germanty: Brussels pushes for wide ECB powers (FT)
- Justice may be blind but it has geographic limits: Apple Loses Patent Lawsuit Against Samsung in Japan (BBG)
- ECB Said to Use Greek Myth for Security on New Euro Banknotes (Bloomberg)
- Alberta deficit set to triple on slumping oil prices (Globe and Mail)
- Reid's ties to China-Nevada solar plan draw ire (Reuters)
- Bernanke may hint at QE without boxing Fed in (Reuters)
- Berezovsky loses against Abramovich (FT)
- Spain Considers Bankia Re-Capitalization Without EU Money (Bloomberg)
A new and important bullish indicator for the gold market is that gold calls are at highs not seen since the October 2008 low as option traders go long gold in the belief that it will go higher. It suggests that option traders believe that U.S. Federal Reserve Chairman Ben Bernanke will hint at or announce additional money printing and monetary easing at the Jackson Hole, Wyoming, symposium. Alternatively, it suggests that they are bullish on gold due to the risks posed to the dollar and the risk of inflation taking off. The ratio of outstanding calls to buy the SPDR Gold Trust versus puts to sell jumped to 2.69 to 1 on August 24th and reached 2.76 earlier this month, the highest level since October 2008, according to data compiled by Bloomberg. Ownership of calls is up 26% since the July 20th options expiry. Ten of the most owned actively owned ETF option contracts are bullish. Option traders are regarded as savvier and tend to be more sophisticated then the more speculative futures traders.
- Merkel Adviser: Unlimited ECB Bond Purchases Would Violate Mandate (Dow Jones)
- Illinois' credit rating downgraded after pension reform failure (Chicago Tribune)
- Correspondence and collusion between the New York Times and the CIA (Guardian)
- ECB action prospects underpin Italian bond auction (Reuters)
- Ryan puts down calculator, picks up bullhorn (Reuters)
- Barclays Names New CEO (WSJ)
- Barclays’s New CEO: Analysts React (WSJ)
- September Offers 15 Days to Cement Crisis Solutions (Bloomberg)
- Iran's Nuclear-Arms Guru Resurfaces (WSJ)
- Rocket blasts off to put NASA radiation belt probes into orbit (Reuters)
- Citi to Settle Suit for $590 Million (WSJ)
- Swiss-Style Latvian Banking Hub Thrives on Ex-Soviet Cash (Boomberg)
- Hurricane Isaac Whips Storm Surge on Path to New Orleans (Bloomberg)
- Republicans Vow to Transform Obama’s U.S. With Low Tax, Freedom (Bloomberg)
- Little-known Ryan to take center-stage at Republican convention (Reuters)
- An $800 billion stimulus tempest in a teapot: China State Researcher: Local Govt Investment Plans Largely Symbolic (WSJ)
- China Says Payment Delays, Defaults May Worsen (Dow Jones)
- G-7 Countries Call for Increased Oil Output to Meet Demand (Bloomberg)
- Creeping Socialism: Clegg calls for emergency tax on rich (FT)
- United Airlines computer problem delays 200 flights (Chicago Sun Times)
- Paulson, Investors Avoid Fireworks Despite Brutal Run (Bloomberg)
- Occupy Sets Wall Street Tie-Up as Protesters Face Burnout (Bloomberg)
- The nostalgic grass is always greener: Serbia Joblessness Swells as Milosevic-Era Leaders Return (Bloomberg)
"Everybody's going to war but we don't know what we are fighting for."
– Nerina Pallot, from "Everybody's Gone to War"
All sides in the coming conflict – except for the civilian populations and the soldiers maimed and killed – believe they will benefit from a limited war in the Middle East if everything goes according to plan. However, nothing ever goes according to plan in wars and this is the problem the world will face. Prolonged recession or depression, wealth and benefit confiscation throughout the EU, US and other Western democracies and the risk of a Middle East conflict spreading around the world is our fear. Who is guaranteed to win regardless of the outcome of the war and whether it can be contained? The Anglo-American financial elites and the bankers always win every conflict regardless of the military outcome. This is the history of the 20th century and we see no reason that will change now.
"We accept the world as it is presented to us. If True American really wished to discover the truth, I would be unable to prevent him from doing so. But he is much happier in my artificial world than he would be in the real world. Since there are so many painful consequences to seeking the truth, he quite rightly prefers to live in my artificial world."