Thursday, October 4, 2012

Do Western Central Banks Have Any Gold Left???

by Eric Sprott & David Baker, Sprott Asset Management
Gold Seek

Somewhere deep in the bowels of the world’s Western central banks lie vaults holding gargantuan piles of physical gold bars… or at least that’s what they all claim. The gold bars are part of their respective foreign currency reserves, which include all the usual fiat currencies like the dollar, the pound, the yen and the euro.
Collectively, the governments/central banks of the United States, United Kingdom, Japan, Switzerland, Eurozone and the International Monetary Fund (IMF) are believed to hold an impressive 23,349 tonnes of gold in their respective reserves, representing more than $1.3 trillion at today’s gold price. Beyond the suggested tonnage, however, very little is actually known about the gold that makes up this massive stockpile. Western central banks disclose next to nothing about where it’s stored, in what form, or how much of the gold reserves are utilized for other purposes. We are assured that it’s all there, of course, but little effort has ever been made by the central banks to provide any details beyond the arbitrary references in their various financial reserve reports.
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Natural Gas — Now this is what a bottom looks like

Nat Gas completes major bottom — trend should now be up for several years

A major bottom is significant for two reasons, both equally important for trading.
  1. The low price is in place
  2. The market should trend higher for an extended period of time
Thus is the case for Natural Gas. The weekly chart below shows that Nat Gas has been in a bear trend for 6-1/2 years. During this time the price of the nearby futures contract has declined from a high of 15.780 (Dec. 2005) to a low of 1.902 (Apr. 2012), a decline of 88%. I think this qualifies as a bear market.
The daily chart now shows a decisive and massive complex H&S bottom in the March 2013 (and all other) contract(s).
A multi-year bullish trend has begun. The initial target is the 2010 high above 6.000. I must point out that trends are all subject to backing and filling. Nat Gas will be no different. The market has already had a good run. Traders should look for periods of weakness (10 to 15% dips) to be a buyer.
I AM NOT A FAN OF UNG (the ETF). It is possible that the price of futures could advance with the price of UNG actually declining.

Silver Manipulation Special Bulletins, with Special Guest Andrew McGuire

by Andrew Hoffman
Miles Franklin

On Friday afternoon, the CFTC’s “so-called” position limits proposal – so-called, as I don’t believe it was EVER anything more than PROPAGANDA – was “thrown out” of court by a lower level District of Columbia judge…
Judge throws out CFTC’s position limits rule
Here’s what I wrote about the “decision” this weekend…
The CRIMINALS – as I have continually predicted – were granted the ability to continue naked shorting PAPER PM, in a decision that “coincidentally” emerged late Friday afternoon, giving the Cartel “cover” to attempt another “SUNDAY NIGHT SENTIMENT” attack – just like last week’s similar, FAILED attempt to knock PMs down.
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Eight Signs the System is Broken

by Simon Black
Sovereign Man

Here are a few interesting tidbits to chew on:
1) In the land of the free, there are now more than 760 incarcerated inmates for every 100,000 citizens. This is more than 5x the 1980 average, and it far surpasses the number (560 per 100,000) that Stalin threw in the Gulag at the peak of Soviet terror.
2) Apparently, Americans are getting more interested in snitching on each other. According to Google Trends, internet searches for terms such as “IRS reward” (and related keywords) have exploded since 2008, and especially this year.
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Here Are Two Incredibly Frightening Charts

from King World News
Today King World News wanted to share with its global readers two absolutely frightening charts (see below). KWN also reached out to Bill Fleckenstein, President of Fleckenstein Capital, and 20-year veteran Jason Goepfert, President & CEO of Sundial Capital Research, to get their thoughts on these troubling charts.
King World News received exclusive permission from SentimenTrader to reproduce the charts shown below.
Fleckenstein warned, “Maybe there will be a problem with the fiscal cliff, Iran and Israel or Europe? Who knows? The bottom line is these are some pretty chunky numbers on the short side for the commercials. They are very extreme.
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Kyle Bass On The Federal Budget: "I Don't Know How To Fix This"

Hayman Capital's Kyle Bass is back and cutting through the caustic bullshit that surrounds every waking moment in this kick-the-can world. Dispelling the myth of our 'deleveraging' virtue, with global debt having grown from $80tn to over $200tn in the last ten years alone (a 10.7% CAGR) and the frightening reality of central bank balance sheet growth of 16% per annum, Bass concludes (rightly) that "you can't do this for very long" as governments infinitely leverage and central banks have begun the endgame of open-ended money-printing. Addressing the question of timing, Bass notes that while Europe and Japan are 'perceived' to be 'staying together' there are in fact devastating losses occurring (ask Greek bond-holders) and he firmly believes that "Germany will never go joint-and-several with the rest of Europe." The world sits at a place it has never been before in peace-time - as far as global debt balances and deficits - and that is why the global investing playbook is so hard. He goes on to address hyper-levered economies, delayed inflationary outcomes, and worries that the cost-push (lower GDP, higher CPI) prints are just beginning in Europe. As a fiduciary, and something all investors should consider, Bass states "Given what we see coming, our job is not to lose money!"  (more)

Spain Will Default on Its Debt Just Like Greece: John Mauldin

QE Done With, Now Watch ECB! – Adrian Day