Stocks, Gold, Silver, and the printing press.

[GodFearinGunTotin]

The Euro lost value when compared to the Federal Reserve note(quite a bit for such a short time period).
The German bond yield went negative as a panic to find a "safe" asset was sought.Would you keep money in your bank if you knew ahead of time they where going to charge you interest(on top of the possibility your deposits would be used to bail out their mistakes)?So many in the market went to German 2 year government notes it drove the yield into negative territory(for only the second time in history).
In short the EU banking crisis just got new legs as depositors(especially large ones)flee the system ahead of negative deposit rates.As I said if you found out your bank was going to start charging you interest on your deposits would you leave your money in the bank?

Gotcha....I think.

 

[smokingman]

Consumer spending up by .2% this quarter and incomes where up by the same .2%.Most every category of consumer spending goods,durable goods,and non durable goods where actually down for the quarter.Leaving just two categories that increased.Personal consumption and services.

Breaking down the increases services showed an almost 1% increase while personal consumption was up .14%.So are people spending more on massages,eating out,and insurance(all categories in services).Not really,the bulk of the increase was in just one item,house hold utilities.House hold utilities had a slight increase in the quarter up 42% by BLS government figures.

So yes consumer spending is up.Good thing consumer spending does not include gas or food right?Other wise consumer spending would be up 6-9%.

How is that recovery?....but but....the Federal Reserve says there is no inflation.

Link to data,graphs,and a further break down of the BLS report.
"Freely Traded Markets Are An Anachronism; Fundamental Rules No Longer Apply" | Zero Hedge

Largest electricity market in the USA is? California.Just going to leave this bomb shell here.

"Government investigators have found that JPMorgan Chase devised “manipulative schemes” that transformed “money-losing power plants into powerful profit centers,” and that one of its most senior executives gave “false and misleading statements” under oath. The findings appear in a confidential government document, reviewed by The New York Times, that was sent to the bank in March, warning of a potential crackdown by the regulator of the nation’s energy markets."





The JPMorgan case arose, according to the document, after the bank’s 2008 takeover of Bear Stearns gave the bank the rights to sell electricity from power plants in California and Michigan. It was a losing business that relied on “inefficient” and outdated technology, or as JPMorgan called it, “an unprofitable asset."

Under “pressure to generate large profits,” the agency’s investigators said, traders in Houston devised a workaround. Adopting eight different “schemes” between September 2010 and June 2011, the traders offered the energy at prices “calculated to falsely appear attractive” to state energy authorities. The effort prompted authorities in California and Michigan to dole out about $83 million in “excessive” payments to JPMorgan, the investigators said. The behavior had “harmful effects” on the markets, according to the document.



In the energy market investigation, the enforcement staff of the Federal Energy Regulatory Commission, or FERC, intends to recommend that the agency pursue an action against JPMorgan over its trading in California and Michigan electric markets.

Blythe did a bad, bad thing. So bad she lied about it under oath.



The regulatory document cites her supposed “knowledge and approval of schemes” carried out by a group of energy traders in Houston. The agency’s investigators claimed that Ms. Masters had “falsely” denied under oath her awareness of the problems and said that JPMorgan had made “scores of false and misleading statements and material omissions” to authorities, the document shows.

For now, according to the document, the enforcement officials plan to recommend that the commission hold the traders and Ms. Masters “individually liable.” While Ms. Masters was “less involved in the day-to-day decisions,” investigators nonetheless noted that she received PowerPoint presentations and e-mails outlining the energy trading strategies.


More at the source.

​

Will JPMorgan's "Enron" Be The End Of Blythe Masters? | Zero Hedge

So that 42% in utilities...anyone remember how well ENRON worked out for those who committed the crime?
​

 

[smokingman]

More bad news that is good news.

U.S. Stocks Rise on Stimulus Bets as Manufacturing Falls - Bloomberg

"U.S. stocks rose, erasing earlier losses for benchmark indexes, amid speculation on central-bank stimulus measures as reports showed manufacturing shrank in the world’s largest economy."

"U.S. industrial production declined in April by the most in eight months, reflecting broad-based cutbacks in factory output. Manufacturing in the New York region unexpectedly shrank in May as factories received fewer orders and sales stagnated."

"The Dow Jones (INDU) Industrial Average added 26.95 points, or 0.2 percent, to 15,242.20, an all-time high."

So the new high on the DOW has 0 to do with poor manufacturing,sales,profit,unemployment,or fundamentals.No in the new normal all it takes is BAD numbers to spur the FED to print MOAR.Of course the FED will print more to keep up with Japan and every other central bank cutting rates and printing more.Madness.

 

[teddy12b]

Madness.

In addition to this the spot price on Silver is now less than $23 per ounce. I can hardly believe what I'm seeing anymore. I hardly even watch the stock market. I follow the spot pricing. As the bubble rises the spot price will go down. Once the bubble pops, I would expect to see precious metals sky rocket in value compared to federal reserve notes.

 

[smokingman]

So what could be better than the 20 billion dollar POMO Tuesday(85 billion a month)from the FED?
How about 20 billion PER DAY?
According to the New York Federal reserve branch that is the average daily handout to the TBTF banks through Securities lending.
Yesterday,by the numbers given they "lent" at 0 interest 25.7 Billion,with the last 30 days averaging just over 20 billion per day.
Straight from the Fed.
Securities Lending - Federal Reserve Bank of New York

 

[zippy23]

Guns are a good investment no matter what, they are practical, useful, and worth every penny. They give peace of mind, and can put food on your table if the dollar value goes down. I heard a great piece of advice once, "invest in what you use." Investing in a piece of paper that has some words on it can get you no where fast!

 

[smokingman]

10 charts from the Saint Louis Federal reserve that should hit the point home very clearly.
10 Perspectives Into The Slow, Agonizing Death Of The American Worker | Zero Hedge

 

[pudly]

Hey Smokingman- Can you clarify POMO an FOMO? I've seen ZeroHedge refer to them quite a few times, but can't find definitions. A general web search came up with a bunch of mostly unrelated acronyms, but even the ones that are financial don't seem to fit the context.

 

[smokingman]

Hey Smokingman- Can you clarify POMO an FOMO? I've seen ZeroHedge refer to them quite a few times, but can't find definitions. A general web search came up with a bunch of mostly unrelated acronyms, but even the ones that are financial don't seem to fit the context.

POMO is the Federal Reserve set days to purchase US Treasuries on the official calender at the FED.The word POMO is short for hand for the Federal Reserve term Permanent Open Market Operations(Quantitative easing,ie QE infinity).

FOMO is Fear Of Missing Out.An Example would be buying on Monday for fear of missing the Tuesday ramp caused by POMO. Example of use "The FOMO buyers Monday where buying early."

The FED does not announce when it will buy mortgage backed securities(MBS),unlike the treasury auctions which are known well ahead of time.MBS purchases are privately done with the banks,so are impossible to front run.

Next Monday is a POMO day,with the FED buying between 3-5.2 Billion in US Treasuries.Most of the time this large of a move happens on a Tuesday,but next week it will be Monday.

 

[smokingman]

There are(where)4 main precious metals exchanges in the world.LBMA(London and the largest),COMEX(Chicago),HKMEX(Hong Kong),and (SGE)Shanghai gold exchange.


As of Monday 5/20/2013 the HKMEX is closing,and settling all contracts in CASH not metal.The Shanghai gold exchange is suspending all sales of physical gold,and will settle all contracts with cash as well(but remain open??).

Leaving us with the COMEX and LBMA(both have dealer inventories of physical lower than they have had in the past 20 years in gold and silver).

Got physical?

HKMEX to Cease Trading, Will Close Out & Cash Settle Open Contracts Monday! | SilverDoctors.com

 

[smokingman]

There are(where)4 main precious metals exchanges in the world.LBMA(London and the largest),COMEX(Chicago),HKMEX(Hong Kong),and (SGE)Shanghai gold exchange.


As of Monday 5/20/2013 the HKMEX is closing,and settling all contracts in CASH not metal.The Shanghai gold exchange is suspending all sales of physical gold,and will settle all contracts with cash as well(but remain open??).

Leaving us with the COMEX and LBMA(both have dealer inventories of physical lower than they have had in the past 20 years in gold and silver).

Got physical?

HKMEX to Cease Trading, Will Close Out & Cash Settle Open Contracts Monday! | SilverDoctors.com

Silver 5/20

Gold 5/20

 

[AtTheMurph]

BTFD!

 

[smokingman]

There are(where)4 main precious metals exchanges in the world.LBMA(London and the largest),COMEX(Chicago),HKMEX(Hong Kong),and (SGE)Shanghai gold exchange.


As of Monday 5/20/2013 the HKMEX is closing,and settling all contracts in CASH not metal.The Shanghai gold exchange is suspending all sales of physical gold,and will settle all contracts with cash as well(but remain open??).

Leaving us with the COMEX and LBMA(both have dealer inventories of physical lower than they have had in the past 20 years in gold and silver).

Got physical?

HKMEX to Cease Trading, Will Close Out & Cash Settle Open Contracts Monday! | SilverDoctors.com

Keeps getting better.

Hong Kong Police Probe Mercantile Exchange at SFC Request - Bloomberg

"Police began probing the Hong Kong Mercantile Exchange Ltd. at the request of the Securities and Futures Commission, which said it found “serious” suspected financial irregularities at the shuttered commodities market.
The financial regulator started its own investigation on May 15 and then referred the matter to Hong Kong Police’s Commercial Crime Bureau, according to a statement published on the SFC’s website yesterday."


"Hong Kong police said yesterday they are investigating, on referral by the SFC, a suspected case of “using a false instrument” involving a commodities company."

I would not expect US regulators to do this at the COMEX.They should have already be investigating though with multiple years worth of production sold on paper in a single day.I guess that explains the quick closing of HKMEX,they had no metal and the financials did not add up.Probably will not be to bad for the founder of HKMEX though Nathanliel Rothchild,looks like Barry Cheung the chairman will be falling on this one(Barry is also a shareholder).

 

[smokingman]

Japan is in deep trouble this morning.They are losing control.

"BOJ injected 2 trillion yen ($19.4 billion) into the financial system to stem volatility following a circuit breaker in JGB futures trading."

Nikkei 225 is now down 1250 points from its highs and down 950 (over 6%) from yesterday's close.*Edit Nikkei is closed,and will stay closed for the rest of the day.Down 1143 to 14483 or -7.32%

6% loss,in FUTURES trading(thin),all trading is currently halted at the NIKKIE exchange,and it looks like they will keep the market closed for the day at this point.The Japanese Bond market is also closed,with the 10 year earning 1%.Margin calls all over the place.It is very ugly.Do you remember what a 6% down day was like(2008 for the DOW)?US futures are down(as are most futures markets in the world due to this).


Going to be an interesting day,with another 1-3 Billion from the FED here(FED purchasing of US treasuries),that may lower the impact temporarily on US markets.

Japanese Shares Extend Biggest Drop in Seven Weeks on Yen - Bloomberg

Japanese Stocks Halted; Plunge 1500 Points To Close Down 7.3% - Biggest Drop In 26 Months | Zero Hedge

http://www.zerohedge.com/news/2013-...arket-halted-open-selling-purge-goes-airborne

On a side note.Who is the largest foreign holder of US Treasury notes?Japan(they over took China last year as China has been a net seller for over 3 years)Japanese banks meeting margin calls will sell US treasuries to help meet those calls.Good thing the FED is buying 90% of all US treasuries issued.The crisis in Japan will have global impact.

 

[buckstopshere]

Wait!?! You mean "Abenomics" isn't working???

PHOTO : Abe on Economist magazine cover | House of Japan - Japan News Technology Autos Culture Life Style

 

[smokingman]

Wait!?! You mean "Abenomics" isn't working???

PHOTO : Abe on Economist magazine cover | House of Japan - Japan News Technology Autos Culture Life Style

(Free wifi at KC airport blocks photobucket or I'd post the pic)

5/23/2013....the blood bath resumes.Japan is in very real trouble.Here in short is the problem.They have deflation(10 years of it).The "cure" was to double the money supply in 52 weeks(QE).The problem is this drove the Nikkei up 85% in weeks(devalue the currency and a company is worth more as stated in this thread a few times).The problem is this has destroyed the Japanese bond market and created massive margin calls in the process.

Today the Nikkei jumped up 400 points(2%+)at the open.Then the Japanese central bank announced another 900 billion Yen in government bond purchases.Further crushing the bond market,carry trade,and once again causing a margin squeeze.This sent the Nikkei crashing.Down 700 points since the high,with Japanese banks leading the way down -11% on average.*Edit...down over 1000 from the high of the day now.

They need to set up shell companies like the FED and our plunge protection team have.They are amateurs at rigging a market.For those who think I have to much tin foil in stating that our market has a plunge protection team I give you Executive Order 12631--Working Group on Financial Markets. Executive Orders or you can just google press releases from the Working Group on Financial markets or read the news paper articles or investor reports on the wikki page.Here is a link to all press releases from the working group.Working Group on Financial Markets - U.S. Department of the Treasury Search Results


Here in the USA the Federal Reserve now owns 30.5% of all issued US treasury notes.At the current rate they will own 100% of all bonds by 2018.It is already playing hell with the shadow banking system and markets due to the lack of tier one capitol.
As Of This Moment Ben Bernanke Own 30.5% Of The US Treasury Market... And Will Own All By 2018 | Zero Hedge
Andy Kessler: WSJ: The Fed Squeezes the Shadow-Banking System


TOKYO(Nikkei)--Bank of Japan Gov. Haruhiko Kuroda said Friday that his institution would continue to operate flexibly in the bond market and watch movements carefully.Speaking at the 19th International Conference on The Future of Asia, Kuroda said, "We will increase our communication with the market." He added that he hopes Japanese financial institutions change their business models to shift Asia's focus from manufacturing to consumption. That should solve the debt problem!!

http://e.nikkei.com/e/fr/tnks/Nni20130524D24JF879.htm

 

[smokingman]

Japanese futures.

Highest volume of trading ever recorded on the TOPIX.Volume is so high if you combine Fukishima and the Lehman collapse volume it would come close to what is currently trading.

 

[smokingman]

5/26/2013

Nikkei slides another 3.4% upon opening.A few banks are limit down and have stopped trading.Some banks are down as much as 16%.

What do you mean doubling the money supply in 52 weeks might have side effects(and they are not even 1/3 of the way to the goal of doubling the money supply)?

 

[smokingman]

5/30/2013 Nikkei down another 5.15% at the close to 13,589.03.

In looking at world markets that are open not one is in the positive.US futures are down as well.Gold and silver are up.

Yes,yes I do think things go down hill from here for the markets.Though it will be a bumpy ride with the Fed injecting MOAR.I am guessing they are going to increase the 85 billion a month to a much higher number.I am sure the currency swaps are already increasing dramatically,as is the use of the discount window.Hope you are not still in the markets.
* Edit.
Many banks are in real trouble.
Bankinter S.A(Spanish bank)is down 24% today.
Mitsubishi UFJ(Japans largest bank)is down 17% in the last week.
Not really a good time for banks.http://money.cnn.com/data/sectors/finance/?sector=4800&industry=4840

 

[smokingman]

Those crazy fringe lunatics are at it again.Saying stocks are in a bubble,and there is going to be inflation that will hurt consumers.



"There is also concern about the possibility of a breakout of inflation, although current inflation risk is not considered unmanageable, and of an unsustainable bubble in equity and fixed-income markets given current prices."

"Uncertainty exists about how markets will reestablish normal valuations when the Fed withdraws from the market. It will likely be difficult to unwind policy accommodation, and the end of monetary easing may be painful for consumers and businesses. Given the Fed’s balance sheet increase of approximately $2.5 trillion since 2008, the Fed may now be perceived as integral to the housing finance system."


Oh,yes the "crazy fear mongers"over at the fed are spreading
unfounded fear.Those are quotes from the Federal Reserve minutes.The 34 Words That May Have Caused Today's Crash In Stocks | Zero Hedge


A video worth watching,i would ignore the title though the video would be better titled "How the COMEX and Federal reserve are stealing your money,and why we are in a decline that will lead to collapse".
http://www.youtube.com/watch?feature=player_embedded&v=TvfzrFGCXos
​