But independent scientists and government officials say another disaster is playing out in slow motion — and out of public view — in the mysterious depths between the gusher and the coast, a world inhabited by sperm whales, gigantic jellyfish and diminutive plankton.
Franco-Nevada Chairman Pierre Lassonde today concludes his two-part interview with Eric King of King World News, predicting that the gold price and the price of the Dow Jones Industrial Average will converge but not by a decimation of the Dow.
Israeli naval commandos stormed a flotilla of ships carrying aid and hundreds of pro-Palestinian activists to the blockaded Gaza Strip on Monday, killing at least 10 passengers in a predawn raid that set off worldwide condemnation and a diplomatic crisis.
Turkey announced it was withdrawing its ambassador to Israel, canceling three joint military drills and calling on the U.N. Security Council to convene in an emergency session about Israel. The Israeli ambassadors in Sweden, Spain, Denmark and Greece were summoned for meetings, and the French foreign minister called for an investigation.
In this business anything is possibly over the short-term. However, almost all spin/MOPE fades without the support of money.
Money continues to fade or bet against a housing market. As the price of lumber has risen, commercial traders have aggressively shorted it across multiple time frames. Such actions could be interpreted as supply/demand related activities, but it's persistence over time weakens that interpretation.
About 46 percent of those surveyed say they're suffering from debt-related stress, and half of that group described their stress as "great deal" or "quite a bit." On the other hand, about 53 percent say they feel little or no stress at all.
Jim Flaherty remembers when pennies were enough to keep him stocked in bubble gum for the baseball diamond, but after four years of chewing on the future of Canada’s smallest denomination, the Finance Minister says the penny’s days are numbered.
Before this recession it appeared that absent action, the government’s long-term commitments would become a problem in a few decades. I believe the government response to the recession has created budgetary stress sufficient to bring about the crisis much sooner. Our generation — not our grandchildren’s — will have to deal with the consequences.
Let me see.
Have heard from Moody's, Fitch and the IMF recently on this problem STATE?
Jim
Two years after Vallejo, California, filed for bankruptcy protection, officials in nearby Antioch are also tossing around the 'B' word.
Antioch's leaders earlier this month said bankruptcy could be an option for the cash-strapped city of roughly 100,000 on the eastern fringe of the San Francisco Bay area.
Senior congressional Democrats and the Obama administration scrambled Wednesday to line up support for $23 billion in federal aid to avert an estimated 100,000 or more school layoffs in a brutal year for education budgets coast to coast.
Germany-based GOLD to go, which is currently churning out 50 gold machines a month to meet a recent jump in demand, launched its first ATM in Abu Dhabi's Emirates Palace Hotel earlier this month and opened its second in Germany last week.
Consumer spending was stagnant in April while incomes posted a tiny advance, signs that the economic recovery could slow.
The $600 million maximum estimate pales in comparison to Lloyd's insurance losses in previous years. The combined might of Hurricane Katrina, Rita and Wilma cost the insurance market $5.856 billion in 2005. In 2006, Hurricane Gustav and Ike produced claims worth $2.574 billion.
Isn't it interesting that reopened swap lines for the euro crisis was announced as only $350 billion yet the Fed reported $1,032 billion has been drawn for an 84 day period this week.
Jim
President Barack Obama moved aggressively to show his government is in charge of the Gulf oil spill on Thursday, calling the spill an "unprecedented disaster" and blasting a "scandalously close relationship" between oil companies and regulators.
U.S. commercial paper outstanding sold by foreign financial companies and their domestic units fell the most in 10 months as fund managers trim holdings of the short-term debt issued by European banks.
"We've seen the highest overall price increase for food prices this year in 10 years," said Bahr, the executive chef at Sage Restaurant in Monroe and 102 A Bistro in Ruston.
By way of example, Bahr said the wholesale price for a 50-pound bag of onions went from $15.50 in January to close to $54.
Sales of gold coins by the U.S. Mint have risen to their highest levels since December 2008, with coin dealers reporting that business is booming thanks to demand from investors unnerved by Europe's sovereign-debt problems and a sharp decline in stock markets.
So far in May, the U.S. Mint has sold 158,000 one-ounce 2010 American Eagle bullion coins, according to the agency's website. This is already more than double the full-month total of 65,000 for May 2009.
It's a currency "substitute," but it's useless. In prison, at least, they use cigarettes: If all else fails, they can smoke them. Imagine a bunch of health nuts in a nonsmoking "facility" still trying to settle their debts with cigarettes. That's gold. It doesn't make sense.
The economic effect of the Gulf is enormous and growing daily.
might literally kill Florida
Jim
The Canadian economy is particularly strong this year, aided by a healthy banking sector and low government deficits relative to its competitors, according to the Organization for Economic Co-operation and Development.
The U.S. government’s Aaa bond rating will come under pressure in the future unless additional measures are taken to reduce projected record budget deficits, according to Moody’s Investors Service Inc.
... the design of GLD is a distinct improvement upon the [gold] carry trade as a vehicle for blunting upward pressure on gold prices from rising investment demand. Gold moves in and out of GLD in 'baskets' of 10,000 ounces created by 'authorized participants.' The list of authorized participants includes all the major bullion banks, which as noted appear free to create baskets with gold loaned or swapped to them by central banks and then to transfer those baskets to GLD in return for shares to be sold to investors.
"In that event, unlike the gold carry trade, official gold is not fully surrendered to the international market by the intermediary bullion banks and subsequently transported to God only knows where. Rather, with GLD as the (presumably bona-fide) purchaser from the intermediary bank, the gold moves to an identified vault subject to the jurisdiction and laws of the United Kingdom. The central banks, as before, can continue to count it in their gold reserves, but now with more practical justification since it also remains within the banking system and their effective control."
Gold and the euro, because a crisis anywhere is a crisis everywhere on the global economy, are in a direct relationship price wise at the moment. Where ever the currency losses holders confidence gold is purchased. Gold is on its violent trip to $1650 and above.
Jim
Thought:
The spin doctors have changed the title of the major Nuclear Scientist reviewing the BP oil spill to a physicist. MOPE is based on the premise of "Never Disturb the Social Order." It would be disturbing if people thought there was a plan to blow it out.
Jim
You know if we did not know of the IMF's impeccable honesty, you would think this is a set up. Next might be Italy, Ireland and GB?
Jim
The International Monetary Fund urged Spain to enact speedy and far-reaching economic reforms, saying its recovery from financial crisis was weak so far, according to a report released Monday.
Cheap, flexible touch screens made with silver and gold nanowires could soon be rolling off the presses and into cell phones, computers and more. The same technology could even be used in solar panels.
"It's a roll-to-roll process, just like printing newspapers," said Yu Cui, a scientist at Stanford University and co-author of the paper. "It's extremely fast and can be done at a very low cost."
The five-day exercise, the biggest in Israel's history, has raised allegations by the country's enemies that it is preparing for war — a concern Israel has sought to allay.
Here's some good news for the struggling US housing market: Thanks to the European debt crisis, mortgage rates are at historic lows.
Greg Hunter's latest is called "Too Big to Fail Means Too Big to Exist." http://usawatchdog.com/too-big-to-fail-means-too-big-to-exist/
"Congressman Grayson recently summed up the importance of financial reform by saying,“We have a basic choice we have to make. Do we want a government of the people, by the people and for the people, or of Wall Street, by Wall Street and for Wall Street? It is disturbing how much this government is by Wall Street and, therefore, you end up with bills that are for Wall Street.”
This month three members of Congress have been beaten in their bids for re-election -- a Republican senator from Utah, a Democratic congressman from West Virginia and a Republican-turned-Democrat senator from Pennsylvania. Their records and their curricula vitae are different. But they all have one thing in common: They are members of an Appropriations Committee.
hence, the volatility in the marketplace is a reflection of the undermined confidence or conviction and thus people will panic very easily compared to before 2007.
Hi Eric,
First of all, my congratulation on and appreciations for your blog and the contributions to Jim Sinclair's website that you make - I have been following both for quite a while now.
Please allow me a question/ comment on your recent posting :
http://business-money-and-finance.blogspot.com/2010/05/two-charts-central-bankers-dont-want.html
I am a huge fan of the Stocks to Gold Ratio, in fact I consider it to be my primary guide to long term investing - it is like a light tower above all the daily and weekly, possibly even monthly market noise.
I have a slightly different view though on the chart analysis you made in that a.m. post, and maybe you'd like to explain your assessment a bit further.
(this one: https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiCcb9jIsb579SST83p80h7VFretjjOg4g2Uk58dSblYdKndsownlkcI-mQ32QykOyzZm4tSl3zjsp3daW3te41xHlFqYCCLlM3eLw2L82qVDUTZIvMXq8fdqZEhgJQP5ABtcto-RCgr70G/s1600/LCSCAGOLDR.JPG)
Without really being able to give a rational explanation for my gutfeel, I believe the Stocks/Gold ratio is going to fall further in this cycle than you drew it in your picture. My reasoning is that our financial system is much more out of whack in every nook and cranny than in the 1930s and also more than in the 1970. In other words, I am fairly convinced that the volatility of the adjustment will be even more violent than in the late 1970s.
Thus my expectation that it might be more appropriate to use an expanding triangle in that graph you made, rather than the parallel lines you used.
I am thus expecting that the DJ-Gold ratio will indeed fall to 1 or -briefly-even below 1. I expect they will meet somewhere between 5000 and 7000 which will of course be the stock buying opportunity of our lifetime. I expect it will be a phase of gut-wrenching volatility, and I do hope that I will have the balls to give up my precious metal stock to buy good stocks in a phase of chaos.
I have attached a crudely retouched graph to this mail, and I'd be most pleased if you found the time to comment and explain your view on my thoughts !
At a time when European economies are drowning in debt and finding it difficult to shake off the recession, along comes the EU to declare that tourism is a human right and that governments should subsidize vacations for those who can't afford nice trips.
Turns out Europeans labored just as hard as--sometimes harder than--we did until the 1970s, when Europe's tax burden started to become heavier and heavier. As people got to keep less of what they earned and goods and services became more expensive, thanks to an ever rising value-added tax, Europeans, not surprisingly, opted for more leisure time and tax-free benefits.
In fact, the cost of public pensions has been systemically underestimated nationwide for more than two decades, say some analysts. By these estimates, state and local officials have promised $5 trillion worth of benefits while thinking they were committing taxpayers to roughly half that amount.
Meanwhile, the most popular alternative to currencies, gold, isn’t such a good buy either, according to the veteran market watcher. “It’s losing upside momentum at the same time more people are getting more enamored with it,” he notes.
Contrary to popular belief, “gold tends to rise when the economy is expanding not when it’s in recession,” according to Prechter’s research. And, as we’ll discuss in more detail in another clip, Prechter thinks deflation and economic depression are a foregone conclusion.
The Milwaukee Public School district is facing a $33 million budget shortfall and administrators have said more than 680 employees could face layoffs. Yet, the MPS superintendent’s budget is set to double next year under the proposed 2011 budget.
Gold is the flight of currency these days: because in Germany the gold market is bare, and the neighbors come to us now, says a dealer. Small gold bars and coins are popular because the buyer must give his name.
It was worse than in the days after the Lehman crash. And, although it was averted by the EU governments a second case of Lehman in the form of a Greek state bankruptcy, precious metals analyst Thorsten Proettel supplemented by Landesbank Baden Wuerttemberg.
French president Nicolas Sarkozy threatened to pull out of the euro if Germany did not agree to bail out crsisi-hit Greece.
Any government intervention in the foreign-exchange market to support the euro after its recent plunge would “buy policymakers time but little else,” according to Standard Bank Plc analyst Steven Barrow.
“In the United States, we don’t seem to me to share the same sense of urgency” as countries such as Ireland, Volcker said in his speech. “The time we have is growing short” and “there are serious questions, most immediately about the sustainability of our commitment to growing entitlement programs.”
While joining the US in backing a softened UN Security Council sanctions package against Iran, Tuesday, May 18, Moscow is reported by debkafile's military sources as surreptitiously training Iranian Revolutionary Guards crews at Russian bases to operate the advanced S-300 interceptor-missile systems, which are capable of fending off a potential US or Israel attack on Iran's nuclear facilities.
We live in market run by hedge funds like all other markets.
When momentum of gold appreciation slows the selling starts. When an uptrend line breaks, the slower computers come on with selling.
Fundamentally there is no change from the intact Western world economic downward spiral.
Technical damage has been done to gold which will work itself out. The reverse is that when the decline's momentum contracts then the shorts are covered and the computers turn bullish.
This is the drama you have seen a million times.
Gold is the only insurance that can be purchased that will carry us whole to the other side of this economic madness.
Gold is going to $1650 and beyond. Dig a hole and pull a rock over top once again. Look out once a day until you see the downside momentum decelerate or a major bullish formation starting.
Stay the course.
Respectfully,
Jim
The euro below $1.20 would strongly suggest Chairman Volcker is right on the subject. The euro below $1.10 would confirm that Volcker is correct. Presently there is key support at $1.2150. The euro today traded as high as 1.2448 and dropped below $1.2150 trading now at $1.2202. That is outrageous activity in a major currency. There is no central bank nor is there any intervention that can stand against the tool of the Credit Default Derivative Swaps. Gold is you're only safe harbor. First currency (Euro) will cut down globally by the tool of the CDS.
Jim
“It brings more uncertainty to the market,” said James Paulsen, who helps oversee about $375 billion as chief investment strategist at Wells Capital Management in Minneapolis. “There’s a negative reaction to anything that regulates or disallows any kind of trading. We tried the same thing in the U.S. too. I don’t know if that really worked.”
The company is more than doubling its annual rate of giving as the number of Americans receiving food stamps has risen to one in eight, and food banks are straining to meet demand.
More people are getting food stamps through the Oregon Department of Human Services than ever before.
In April, more than 700,000 Oregonians received food stamps, equivalent to about one in every 5 people. That is higher than the national average, which is about 1 in every 8.
"They are a really good barometer, a kind of economic-needs test," said Mark R. Rank, an expert on social welfare programs at Washington University in St. Louis. "If you're receiving food stamps and you're a child, by definition, you're in poverty."
Raul Zavala, owner of Original Designs custom jewelry store, said he's seeing a lot more sellers, especially toward the end of the month, when rent is due.
"Every time, they tell me they're selling their gold because they're struggling to pay the bills," he said.
Construction of new homes rose more than expected in April, but new building permits fell sharply, signaling that the building industry's rebound could be short-lived.
The Commerce Department says construction of new homes and apartments rose 5.8 percent last month to a seasonally adjusted annual rate of 672,000. The results were the highest since October 2008 and were driven by a 10 percent increase in the single-family market.
"Strategic defaults" are on the rise as more borrowers who are underwater on their home loans decide it's not worth it to stay current on their payments each month. That trend could have repercussions for the housing market, and for borrowers, in the future.
Silver was up strongly on the discussion of JP Morgan who we were informed had a Department of Justice examination of their activities in Silver. This was reported as fact. The reports were 50% correct in that JP Morgan was being looked into concerning their derivative dealing however the target of exchange listed silver was not mentioned in the official report. Since silver went up hard on euro weakness, as the euro strengthened gold reacted downwards, and silver gave up part of its recent significant gains.
Very interesting interview with Ron paul in 1971 Ron Paul bought Gold coins at $35per oz because he new eventually the system that replaced Bretton Woods would fail
Greek Prime Minister George Papandreou declared he is not ruling out taking legal action against U.S. investment banks for their role in creating the spiraling Greek debt crisis.
If your credit isn't good, General Motors Co. still wants to sell you a car.
The problem is, it can't. At least not in big numbers. That's why the automaker wants more control over its lending again.
GM's top North American executive Mark Reuss, under pressure to quickly sell more cars and boost GM's value as it gets ready to sell stock to the public, said a shortage of subprime lending is holding back sales in the U.S.
Everything will be bailed out, every state will be bailed out, all sovereign debt will be bailed out as quantitative easing goes to infinity. Gold will trade on this leg at $1650 - minimum and more than likely much more.
Jim
The Obama administration came out Thursday in support of emergency education funding legislation that would provide $23 billion to preserve teacher jobs in the face of massive impending layoffs across the country.
