Pento - 27 Years Of Financial Inflation Refute Pimco/McCulley Blather About Fed Achieving Promised Land Of Price Stability

Pento MichaelMichael Pento writes: According to Pimco’s new Chief Economist, Paul McCulley, the Fed’s war against inflation has been won!  But, before we get out our party hats and plan the tickertape parade, we have to ask ourselves – for the past 27 years have we really been at war with inflation? 

Yes, during the late 1970’s and early 80’s a different Paul (Paul Volcker, Chairman of the Federal Reserve) waged a real battle against inflation.  Mr. Volcker painfully took the Fed Funds rate to near 20 percent in June of 1981.  The economy suffered a deep recession, it was a treacherous battle plan, but the Fed stayed the course because Volcker was correctly convinced that limiting the growth rate of the money supply was the key to popping asset bubbles, vanquishing inflation and establishing a sound economy.

Fast forward six years, exit Paul Volker, and enter Alan Greenspan. For the back drop, it was the crash of 1987….and after declaring “mission accomplished” on the inflation war, Greenspan sought to fight a new war against falling stock prices.  Acting as the veritable Navy Seal of financial market defense, Greenspan valiantly leapt to shield markets from corrections.  This “special operation”, was affectionately referred to as the “Greenspan put”.  Over the years the “put” has remained, we have merely substituted Greenspan with Bernanke and now Yellen.  And so for the past 27 years, the only “war” the Federal Reserve has been waging has been to inflate asset bubbles.  These bubbles bring the economy to the brink of financial destruction, leading the central bank to intensify its efforts to fight deflation with each iteration.

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Jeff Clark - Western Delusions vs. Chinese Realities

Clark Jeff Casey ResearchJeff Clark, Senior Precious Metals Analyst for Casey Research writes  this must-read essay:  I don’t want to say that mainstream analysts are stupid when it comes to China’s gold habits, but I did look up how to say that word in Chinese…

One report claims, for example, that gold demand in China is down because the yuan has fallen and made the metal more expensive in the country. Sounds reasonable, and it has a grain of truth to it. But as you’ll see below, it completely misses the bigger picture, because it overlooks a major development with how the country now imports precious metals.

I’ve seen so many misleading headlines over the last couple months that I thought it time to correct some of the misconceptions. I’ll let you decide if mainstream North American analysts are stupid or not.

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COMEX Mercenary Swap Dealer Banks Way Short Silver Too, Vulnerable to a Squeeze

Trading pit farUpdate 1:  Adds additional commentary in several paragraphs regarding our expectations for gold and silver. 

HOUSTON -- Just for the record for those who have read our update on the gold futures positioning by the main combatants on the COMEX – where we show that it is the mercenary Swap Dealers with the most and largest gross short positioning for gold and suggest they are vulnerable to a short squeeze under the “right" circumstances.  (As in the other COMEX traders deciding to press gold at the right time, forcing the Swap Dealers to cover in haste … that’s one example of many, many one can conjure up). 

Well, let it be known that it is also the same Swap Dealers who have built up a very high gross short position in silver as well. 

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COMEX Large Trader Positioning for Gold Holds Surprises in July 15 Data

Arensberg Gene CaptainHOUSTON -- On July 15 we posted the net positioning of the COMEX large trader particpants in these pages, saying at the time:  We pretty much have to conclude that the Swap Dealer commercials and perhaps the Producer/Merchants together decided the time had come to run the table on the Managed Money traders, so they sold a ton of new paper to get the ball rolling down hill in a period of light activity and volume, probably covering much of the starter sales by the end of each trading day.” 

The sell blitz which is commonly used on the COMEX is designed to trigger sell stops and new shorting by trend following traders.  We have to presume these overly large selling attacks are initiated by entities who stand to benefit from the action, otherwise why have them at all?  Ergo, if one were to look at which class of trader holds a large short position … they would intuitively be the likely instigator.  Let’s just go with the obvious for now and see what the data suggests (on the surface). Based on current net positions, the actors with the most to gain from a sell raid remain the way-overly short Swap Dealers, but we are getting ahead of the story a little...

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Gold and Silver Disaggregated COT Report (DCOT) for July 18

CFTC logoUpdate 2:  Adds new graphs for COMEX silver (SI) with additional commentary on volume and trade action.  

Update 1:  Adds one graph for silver futures with brief commentary. 

HOUSTON – The Commodity Futures Trading Commission (CFTC) released data for the disaggregated commitments of traders (DCOT) and Legacy “COT” reports for the week ending July 18, 2014.  Our recap of the net positioning for large reporting futures traders is below, compared to the prior week’s data. 

Source: CFTC for COT data, Cash Market for gold and silver prices.  The positioning and price data is as of the close of trade in New York on Tuesday, July 15, 2014.

Table below.

20140718 DCOT RECAP

In the DCOT table above a net short position shows as a negative figure in red. A net long position shows in black. In the Change column, a negative number indicates either an increase to an existing net short position or a reduction of a net long position. A black figure in the Change column indicates an increase to an existing long position or a reduction of an existing net short position. The way to think of it is that black figures in the Change column are traders getting “longer” and red figures are traders getting less long or shorter.

 

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Russia: US sanctions revenge for Ukrainian failure, Moscow may retaliate

People's militia soldiers in the occupied village of Marinovka, near the town of Snezhnoye. (RIA Novosti / Andrey Stenin)

People's militia soldiers in the occupied village of Marinovka, near the town of Snezhnoye. (RIA Novosti / Andrey Stenin)

Russia considers the latest package of sanctions against it issued by the US as revenge for the failure of Washington’s schemes in Ukraine and blackmail. Moscow reserves the right to retaliate.

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Kyle Bass - With John Mauldin Brief Video Interview

 

Bass Kyle small facing rightAnytime Hayman Capital's Kyle Bass has something to say we make time to listen.  In this must watch video interview with John Mauldin, Bass does not disappoint.  A couple of quotes to whet the appetite:

"The brotherhood of central bankers is the biggest mutual admiration society in the world."

"The bottom line is when the globe is at 360 percent credit market debt to GDP and there is no real way out ... and as we see today the winds of austerity have already blown ... we are already moving back into a more 'Krugmanesque policy' of "let's just keep going..." 

 "No central bank can have it an an outward policy to devalue their currency.  It may  be a second or third derivative of another policy they are engaging in to 'encourage price stability and inflation'..."

Video below, about 5 minnutes.  Do not miss it. 

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Israeli military launches ground offensive in Gaza

JERUSALEM — The Israeli military announced a ground offensive in the Gaza Strip late Thursday after 10 days of fighting between Israel and Hamas militants.

"Our goal is to target Hamas' tunnels that enable terrorists to infiltrate Israel and carry out attacks," Israel Defense Forces announced on Twitter.

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Tuesday, July 22, 2014

Gold - Is This Cold War 2.0? – Frank Holmes

Kitcos set up for this brief video update reads: Kitco News speaks with Frank Holmes to see how he sees gold set up for the coming week. “I think the sentiment is very different,”he says.

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Monday, July 21, 2014

New Gold Miner ETF Avoids Primary Investment in Barrick

Chris Powell writes for the Gold Anti-Trust Action Committee (GATA) and today informs us of a new ETF that excludes a very large, but terribly unpopular mining company. Powell begins: Looks like you can now buy a gold-mining stock exchange-traded fund without putting the biggest part of your money in Barrick Gold, the biggest gold hedger and enabler of gold price suppression, the company that 11 years ago, by virtue of its enormous hedging, claimed to be

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The dollar's 70-year dominance is coming to an end

Within a decade, greenbacks could be replaced as the worlds reserve currency. In early July 1944, delegates from 44 countries gathered at the Mount Washington Hotel in Bretton Woods, New Hampshire. A three-week summit took place, at which a new system was agreed to regulate the international monetary and financial order after the Second World War. The US was already the world’s commercial powerhouse, having eclipsed the British Empire several decades earlier. America was also on course

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Sunday, July 20, 2014

A Few Issuers We Are Watching

A few of the issues we are following closely. // We have been watching this one for an opportunity to increase our stake and this week it finally moved down into what we consider our “wheelhouse.”

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GATA needs help, so please consider buying a T-shirt

Please consider this message from our friend,Chris Powell, of the Gold Anti-Trust Action Committee (GATA), who writes: Challenging all the money and power in the world, GATA long has operated more or less on a shoestring...

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Saturday, July 19, 2014

Nanex ~ 15-Jul-2014 ~ Perfect Pilfering

A detailed exposé on how the market is rigged from a data-centric approach- We received trade execution reports from an active trader who wanted to know why his large orders almost never completely filled, even when the amount of stock advertised exceeded the number of shares wanted. For example, if 25,000 shares were at the best offer, and he sent in a limit order at the best offer price for 20,000 shares, the trade would, more likely

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The Ongoing Rot in the Economy

Eric Sprott, Sprott Asset Manangement LP writes: While most have been conveniently blaming the tepid first quarter -2.9% GDP growth figure on the weather, we believe that it is just another symptom of a much deeper malaise. As we have argued many times before (see, for example, the March 2014 Markets at a Glance), the U.S. economy has been on life support,

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Memo To Yellen: Stocks At 3rd Highest Shiller PE Ever—Not At “Historical Norms”

Pater Tenebrarumwrites for Acting-Man.com: There Could be Some Bubble Risk Somewhere … Maybe …

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Russian Media Goes Far Out to Explain Malaysia Airlines Disaster

Photograph by Dominique Faget/AFP via Getty Images Carol Matlack writes for Bloomberg: A piece of wreckage from Malaysia Airlines flight MH17 is pictured on July 18 in Shaktarsk, the day after it crashed... Russians awoke on Friday to news reports that bumbling Ukrainian troops had shot down a Malaysia Airlines (MAS:MK) jet after mistaking it for President Vladimir Putin’s official plane. Another theory: The Ukrainians intentionally shot down the jet at close range as a “planned provocation.”

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Friday, July 18, 2014

David Stockman Interview On CNBC: Markets Teetering On Edge—-Beware Of Black Swan

Former OMB Director under Ronald Reagan, David Stockman, weighs in, and we mean weighs in heavy with the CNBC Futures Now crew.

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Russia: US sanctions revenge for Ukrainian failure, Moscow may retaliate

Peoples militia soldiers in the occupied village of Marinovka, near the town of Snezhnoye. (RIA Novosti / Andrey Stenin) Russia considers the latest package of sanctions against it issued by the US as revenge for the failure of Washington’s schemes in Ukraine and blackmail. Moscow reserves the right to retaliate.

Continue reading "Russia: US sanctions revenge for Ukrainian failure, Moscow may retaliate" »

Kuroda Softens Yen Stance as Export Pain Evaporates: Currencies

Foreign-exchange traders detect a softening inBank of JapanGovernor Haruhiko Kuroda’s stance toward the stronger yen.

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Pretivm Files Final Base Shelf Prospectus

VANCOUVER, BRITISH COLUMBIA--(Marketwired - July 18, 2014) - Pretium Resources Inc. (TSX:PVG)(NYSE:PVG) (Pretivm or the Company), has filed a final short form base shelf prospectus (the Prospectus) with the securities commissions in each of the provinces and territories of Canada, except Quebec, and a corresponding shelf registration statement on Form F-10 with the U.S. Securities and Exchange Commission (the SEC) under the U.S. Securities Act of 1933, as amended, and the U.S./Canada Multijurisdictional Disclosure System.

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Reuters - Nikkei in biggest one-day drop in 2 months as downing of Malaysia jet hits mood

-- Nikkei in biggest one-day drop in 2 months as downing of Malaysia jet hits mood * Geopolitical concern could have mid-term impact - fund manager ...* Oil companies outperform on rising oil prices ... By Ayai Tomisawa

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Unconfirmed Radio Transcripts Suggest Pro-Russian Rebels Shot Down MH17

David Stout writes for Time. He begins with a sub header: Three intercepted conversations appear to pin the downing of Malaysia Airlines Flight 17 to rebel groups based in southeastern Ukraines Donetsk region...

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Thursday, July 17, 2014

McEwen Mining Q2 2014 Production Results

TORONTO, ONTARIO - (July 17, 2014) - McEwen Mining Inc. (NYSE: MUX) (TSX: MUX) is pleased to announce production results for Q2 2014. Production in Q2 was 31,200 gold eq. oz(1)(2) comprised of 18,863 gold oz and 740,276 silver oz, consistent with guidance. This is a decrease of 8% compared to Q2 2013 and 3% compared to Q1 2014. Full-year guidance remains unchanged at 135,000-140,000 gold eq. oz as production is expected to increase in Q4, due

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IMF congratulates BRICS for new fund, offers help

BRASILIA (Reuters) - The International Monetary Fund on Wednesday congratulated the five BRICS countries for creating a new reserves fund that intends to challenge Western dominance in the global lender. The IMFs managing director, Christine Lagarde, said the lender would like to work with the BRICS in the new fund, which pools together $100 billion in reserves from Brazil, Russia, India, China and South Africa.

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How Eastern Gold Demand Is Transforming The Gold Market

Our good friend Chris Powell, GATA, sent us this informative link: GoldSilverWorlds has a goodpostup summarising mytweetsand Al Korelininterviewabout theLBMA Forumin Singapore. Below are some additional notes I took which I didnt tweet or talk about.Zhang Bing Nan of China Gold Association (view his slideshere) when asked about the West to East flow gave what I think is a classic Chinese answer: the globe is round so what is East and what is West, which got a

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India Imported 713 MT Of Silver In April, 1921 MT YTD

Indian Silver Demand Strong As Gold Is Curbed. Precious metals analysts have received a few gifts from the authorities this year. In January the Swiss Customs Administration (SCA) decided to disclose their gold trade data country specific (previously only the total import and exportnumbersof bullion wereavailable), also in January British customs (HMRC) decided to add gold in their trade database (in previous years UK gold trade could only be tracked throughEurostat), and this week the Indian customs

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Wednesday, July 16, 2014

Suchecki - GLD amendment refers to "unforeseen reasons" for unallocated failure

Bron Suchecki writes for his own blog called Gold Chat. Bron is connected with the Perth Mint down under. Bron writes: GLD has someamendmentsto its terms up for vote, one of which isthat creations may only be made after the required gold deposit has been allocated to the Trust Allocated Account from the Trust Unallocated Account(hat tipI Shrugged; seeherefor an explanation of the existing creation process). What is interesting is the explanation of why they are making

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GoldQuest Files Preliminary Economic Assessment for Gold-Copper Romero Project, Dominican Republic

VANCOUVER, BC--(Marketwired - July 16, 2014) - GoldQuest Mining Corp. (TSX VENTURE: GQC)(FRANKFURT: M1W)(BERLIN: M1W) (GoldQuest or the Company) is pleased to announce that it has filed the Preliminary Economic Assessment (PEA) Technical Report for the Companys 100% owned Romero Gold-Copper Project in the Dominican Republic, on SEDAR.The PEA study was led by Micon International Limited.

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BRICS Agree on $50 Billion Bank With Something for Everyone

Raymond Colitt, Unni Krishnan and Arnaldo Galvao, Bloomberg, write: Leaders of the five BRICS nations agreed on the structure of a $50 billiondevelopment bankby grantingChinaits headquarters andIndiaits first rotating presidency.Brazil, Russia andSouth Africawere also granted posts or units in the new bank. The leaders also formalized the creation of a $100 billion currency exchange reserve, whichmember statescan tap in case of balance of payment crises, according to a statement issued at a summit in Fortaleza, Brazil. Both

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Will Gold, Silver Continue Higher in 2014? -- Rick Rule

Henry Bonner, Sprott Global Resource Investments, writes: Rick Rule, Chairman of Sprott US Holdings Ltd.said in early Marchthat the market looked overheated and was due for a pullback. Gold and silver had just delivered double-digit gains in a few months. Sure enough, from mid-March until early June, the precious metals gave up much of their gains.1 Since early June, resource stocks have surged higher once again.2So the question on my mind was:Where is gold headed for the

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Tuesday, July 15, 2014

McEwen Mining Announces Nathan Stubina, Ph.D, P.Eng as Managing Director

TORONTO, ONTARIO--(Marketwired-July 15, 2014) -McEwen Mining Inc.(NYSE:MUX)(TSX:MUX)is pleased to announce the appointment ofNathan Stubinaas Managing Director ofMcEwen Mining. Nathan was previously the corporations Vice-President, Technology and will be taking over the responsibilities ofIan Ball, former President.

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Gold ETFs Paint The Real Picture - Frank Holmes

Kitcos Daniela Cambone talks to Frank Holmes or U.S. Global Investors of San Antonio, Texas.

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Biderman - Earnings Schmernings - Earnings Don't Predict Stock Prices

Longtime readers of GGR know we think pretty highly of what Charles Biderman has to say. Right or wrong, hes a sharp cookie with his finger on the pulse of money flows like no other.

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Kaminak Gets a Ross Beaty Vote of Confidence, Soars 32%

I mentioned to a newsletter writer friend today that when someone can make money with just their reputation, whomever that is “is living right.”

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Monday, July 14, 2014

Constantine Metal Resources Under Accumulation Ahead of Drill Results

For those who might be following Constantine Metal Resources (CEM.V) , who is in the process of drilling an exciting and potentially very large VMS* deposit called Palmer in Alaska. Continued next page...

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Draghi Seen Delivering $1 Trillion to Banks in ECB Offer

Mario Draghi, president of the European Central Bank. Mario Draghi’s newest stimulus tool will hand banks more than 700 billion euros ($950 billion) of cheap funding, economists say. The European Central Bank president’s targeted lending program for banks will boost credit for the real economy as planned, and at the same time help keep the financial system flush with cash, according to the Bloomberg Monthly Survey of 45 economists. Draghi may address the topic today when he

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BIS chief fears fresh Lehman from worldwide debt surge

Jaime Caruana says investors are ignoring prospect of higher interest rates in the hunt for returns Ambrose Evans-Pritchard writes: The world economy is just as vulnerable to a financial crisis as it was in 2007, with the added danger that debt ratios are now far higher and emerging markets have been drawn into the fire as well, the Bank for International Settlements has warned. Jaime Caruana, head of the Swiss-based financial watchdog, said investors were ignoring the

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The Original
Vulture Speculator

Trading gold, silver and mining shares since 1980 with a focus on taking advantage of volatility extremes, Gene Arensberg analyses the markets through a basket of technical and fundamental indicators and shares his findings from time to time here at Got Gold Report. Mr. Arensberg has been quoted in the Wall Street Journal, Dow Jones MarketWatch, USA Today and dozens of other news organizations.

"I've been a huge fan of Gene and his amazing work for years..."

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