, Gold and Silver News

Sunday, December 16, 2018

Gary Christenson: Yield Curve Inversion and Recession Fears

Every recession since the 1950s has been preceded by a yield curve inversion. The yield curve is flattening and recently became partially inverted. 

Former business manager Gary Christenson joins Silver Doctors to discuss. The five-year rate fell below the two-year rate. We’re headed toward recession and stock market correction, Christenson says. 

He says even just looking at the stock market itself technically, it looks quite weak. Christenson sees gold and silver, especially silver, extremely undervalued. 

He forecasts silver rising substantially from here, while there may be some short term weakness.

- Source, Silver Doctors

Saturday, December 15, 2018

Why Gold Is Still The More Stable Safe Haven Asset For 2019

With fears of more volatility in stock markets ahead, investors could do well holding gold, which is still the reliable safe haven asset, said Phil Streible, senior market strategist at RJO Futures. 

“Even if you look at bonds and interest rates, the volatility has been quite high in there. We’ve seen bonds tick up three, four, five handles within a short period of time. 

I think that gold has been a much better, a much more stable investment asset for a safe haven,” Streible told Kitco News.

- Source, Kitco News

Friday, December 14, 2018

Ralph Acampora, The Hammer, Capitulation And Is It A Dow Theory Sell Signal Or Not?

Below is today’s note from Jeffrey Saut, Chief Investment Strategist at Raymond James: Yesterday, someone sent us this tweet from stock market guru Ralph Acampora that read, “Monday’s intraday activity and its closes on the leading market indexes were impressive: it’s called a ‘key reversal-day’ on a bar chart and a ‘hammer’ pattern on a candlestick chart. They suggest that an important near-term low was made.” Now, for non- technical folks, a hammer formation in the candlestick charts is defined as follows:

“A hammer is a type of bullish reversal candlestick pattern, made up of just one candle, found in price charts of financial assets. The candle looks like a hammer, as it has a long lower wick and a short body at the top of the candlestick with little or no upper wick (see chart below).”

Ralph Block & The McClellan Oscillator

Also suggestive that a bottom was made on Monday was what our deceased friend Ralph Block used to term a multi-swinging session. To wit, “Ralph was a huge fan of a crater opening, multi-swinging session that ends near the high of the day. Looks like it was just what he would have wanted!” We would add that the McClellan Oscillator is pretty oversold on a short-term basis (see chart below).

McClellan Oscillator Is Very Oversold Short-Term

Russell 2000
Likewise, the Russell 2000 is some 10% below its 200-day moving average and, therefore, oversold (see chart below).

Russell 2000 10% Below It’s 200-Day Moving Average

Energy Complex
And, don’t look now, but the energy complex is very oversold (also has a hammer chart formation – see chart below) with the anecdotal evidence that a bottom is near with three large energy-centric hedge funds closing their doors.

Energy Complex Also Very Oversold

About A Dow Theory “Sell Signal”

As for the questions about a Dow Theory “sell signal” that are being trumpeted by some on the Street of Dreams, by our method of interpreting Dow Theory, there has been no “sell signal.” 

The problem is these folks are using the November closing low for the Industrials, which is the wrong reaction closing low to use. While it is true the D-J Transports notched a new reaction low last Friday, the D-J Industrials have not violated their March 2018 closing low (the right closing low to use). 

As such, what we have, according to Dow Theory by our method of interpretation, is a downside non-confirmation, which should be interpreted bullishly…

- Source, King World News

Thursday, December 13, 2018

Gold and Silver Prices Rise As The Markets and Oil Decline

Over the past week, the gold and silver prices have held up rather well compared to the overall markets. While precious metals investors still fear that a huge sell-off in the gold and silver prices will take place during the next market crash, it seems that the metals continue to be very resilient during large market corrections.

Now, I am not saying that the metals prices cannot fall any lower, but a lot of the leverage in the gold and silver market has already been removed and is now at a near all-time low. So, even though we could see weaker precious metals prices, the overwhelming leverage and bubble asset prices are in the stock and real estate markets.

Furthermore, one of the reasons precious metals investors still fear that a major selloff is imminent is that they are using the 2007-2008 economic market meltdown as a guideline. However, when gold and silver prices were plummeting from their highs in 2008, along with the rest of the market, speculators held huge long positions while the commercials controlled an enormous number of short contracts.

If we look at the following Gold Hedgers Chart, we can clearly see that the market setup today is the exact opposite of what it was in 2008:

When gold was trading near $1,000 in early 2008, the commercial banks held a record high of 252,000 net short contracts compared to the present gold price of $1,222 (time of chart), with the commercials only holding 16,000 net short contracts. The commercial short positions are shown by the blue line. Thus, the higher the commercial short positions, the lower the line goes and the lower the number, the higher the line moves. Currently, the gold price and commercial net short positions are both at the near lows. Also, the speculator net long positions are close to their lows as well

So, when PUSH COMES TO SHOVE, we won’t see a large number of speculators forced to cover their long gold positions if the gold price falls lower because there isn’t that much leverage in the market.

- Source, SRS Rocco, Read More Here

Tuesday, December 11, 2018

What They Aren't Telling You About The Yield Curve

Join Mike Maloney as he reveals an important factor of the partial Yield Curve inversion that is being ignored by mainstream news and media. Then stick around to the end of the video to see yet another indicator that is suggesting a huge change in markets could be upon us...

Sunday, December 9, 2018

Cracks Appearing... The Next Crisis Will Be Worse Than Anything Before

Bubbles burst from the “outside in,” Chris Martenson says. And that’s what we’re seeing right now. 

Cracks are appearing on the outside. Many junk rated debt and periphery country’s stock markets are in bear markets. 

Watch out for the crisis to seek into the bigger sectors. The economy cannot grow exponentially in a finite world. An infinite model cannot run on a finite sphere. 

By 2020 - 2022, a major energy crisis will hit in oil, Martenson says. 

How can we move out of the current infinite growth financial paradigm? Stay tuned to find out!

- Source, Silver Doctors

Friday, December 7, 2018

Ron Paul: Trade War On Hold? Trump, Xi, And The G20 Summit

The G20 summit in Argentina has concluded. Are we better off? Will the temporary pause on new US/China tariffs hold? 

Anything positive from the brief Trump/Putin meet and greet? Missed opportunities? 

We break it all down in today's Liberty Report.

- Source, Ron Paul

Tuesday, December 4, 2018

William Black: Deutsche Bank Crime Weakens Global Financial System

Professor of Economics and Law, William Black, who was a top regulator in the S&L crisis, says, “Deutsche Bank is one of the potential sources of the next recession, and you can see lots of people warning that there are signs that a serious recession is pretty likely relatively soon.

The whole system weakens itself because it gets caught in this big lie that says we have to pretend that Deutsche Bank is a bank instead of a criminal enterprise.” 

In closing, Professor Black says, “I am going to give you the advice you get after the recession before the recession. Pay off your debt, all that you can. 

Do not keep borrowing except in certain circumstances like you are going to buy a home and it is prudent purchase. 

Buy a car when you can buy it with cash whenever possible and always try to be a net saver.”

- Source, USA Watchdog

Friday, November 30, 2018

What Hyperinflation Looks Like in Venezuela First Hand, On the Ground

If you know anything about the crisis in Venezuela, you’ve most likely seen the work of Meridith Kohut, an independent photojournalist based in Caracas.

Meridith, who frequently photographs for The Times, has taken some of the most haunting images to come out of the country as its economy has spiraled deeper into chaos.

There was the baby boy who died of heart failure caused by extreme malnutrition, his father weeping over the coffin. The emaciated patients locked in isolation cells at an underfunded psychiatric ward. 

The street protesters in gas masks hurling Molotov cocktails at security forces. Meridith’s photos, at once unsettling and illuminating, offer a window into the daily struggles of Venezuelans.

This month Meridith, 35, was one of four female journalists around the world to be honored by the International Women’s Media Foundation with a Courage in Journalism Award. In a recent interview, she spoke about the challenges of reporting in Venezuela, the global resonance of her work and what she wishes readers knew...

Mike Maloney: I Found A New Recession Indicator That Says LOOK OUT BELOW

Mike Maloney was excited. It was our weekly company meeting, and he interrupted it to tell us all about a new recession indicator he’d just discovered. 

In fact, he said it is “one of the most reliable indicators of a pending recession I have ever come across.” And that’s the basis of his just-released video, "I Found a Brand New Recession Indicator and It Says Look Out Below!" 

He showed us a series of charts, some of which were highlighted in his Early Warning Webinar. T

hey include the Wilshire 5000 Index, the US monetary base, and the federal government’s tax receipts. And it is the correlation of those charts that formed the basis of what Mike calls the “financialization of government.” And then he showed us a new indicator that has a strong track record of predicting recessions. It works like this… 

Since 2000, the data show that tax revenues fall when the stock market falls. In other words, a rising stock market feeds higher and higher tax receipts to the government. 

If tax revenues fall, however, federal income declines, because less tax on capital gains come in. And this leads to an expansion in the deficit. You’d think the government would be better prepared for this reality, but they never are because they never plan on a recession. 

So when the stock market inevitably crashes, the government reacts by lowering interest rates, printing money, or expanding government programs – all of which, of course, grow the deficit even larger. 

But where the story gets very interesting is when Mike compares tax revenue to the timeline of past recessions, particularly tax receipts on corporate income. 

You might think that tax revenues would fall after a recession starts – but what the data show is that tax revenue in most cases has fallen before a recession. 

As Mike shows, in 14 of the last 17 times that corporate tax receipts have begun to roll over and decline, a recession started not long after. In other words… 

A drop in corporate tax receipts has frequently predicted a recession. And guess what? Corporate tax revenue has started to fall. 

Given how high the stock market has climbed, this source of tax revenue will drop hard when the stock market crashes. Indeed, the second-longest bull market in stocks could mean a bigger crash than normal and a nastier recession than many expect.

- Source

Thursday, November 29, 2018

Perpetual Surveillance: Your Smart City Knows More About You Than Your Mother Does

Dr. Oscar Gandy joins the commentary to discuss: TGI: Transactional-Generated Information - the fuel for AI control. Artificial Intelligence: “It’s time to come to terms with the machine” Dr. Oscar Gandy, Author of “The Panoptic Sort: A Political Economy Of Personal Information”: Functioning in a completely monitored environment...

Tuesday, November 27, 2018

A Golden Renaissance

The Battles for Civilization

There is the freedom of speech battle, with the forces of darkness advancing all over. For example, in Pakistan, there are killings of journalists. Saudi Arabia apparently had journalist Khashoggi killed. New Zealand now can force travellers to provide the password to their phones so the government can go through all your data, presumably including your gmail, Onedrive, Evernote, and WhatsApp. China is now developing a “social credit” system, to centrally plan the economy and control citizen behavior. Canada has made it a crime to call someone by the wrong gender pronoun. Even in the US, whose First Amendment has (mostly) stood as a bulwark against censorship now has a president who threatens antitrust action against Amazon, because its CEO Jeff Bezos owns the Washington Post, which prints things he does not like. On college campuses, professors are harassed if they say one thing that the professional sensitives are sensitive to. If a controversial speaker is invited, he risks an angry mob coming to disrupt his talk (or worse).

Then, there is the nearly-over war against patients’ rights to purchase health care services from the provider of their own choosing, and health care professionals’ right to sell services to patients at a price they prefer. In the US, insurance companies are still forced (as under Obamacare) to provide insurance to anyone who applies, even those who have pre-existing conditions. This would be like forcing home insurance companies to issue policies to people whose houses are currently on fire. It is not insurance, but an unfunded welfare program.

The use of practical energy sources is in the battle for its life. Germany and Japan are de-nuclearizing. Other countries flirt with taxes designed, not to raise revenue, but to reduce the use of fossil fuels. While many may go along with this, thinking it’s OK to pay another 50 cents a gallon for gasoline, this will not be nearly enough to force large numbers of people to do without. Gasoline for driving to work and oil for heating homes has a highly inelastic demand. The price would have to rise enough to force people to change their lifestyles, abandoning their spacious houses in the suburbs to crowd into tiny urban apartments. In Europe this month, Keith saw petrol around $8 a gallon. And they use so much fossil fuels that more taxes are demanded to reduce carbon dioxide much further.

Few Want a Free Market in Money

And don’t even get us started on money. Even otherwise-free-market economists, and even wealthy entrepreneurs and business leaders, are for a properly managed irredeemable currency. One prominent person who is all of the above recently declared that if the Fed adopted GDP targeting (it currently does its central planning based on inflation and unemployment) it would end the business cycle! He did not want to hear anything about GDP being an invalid measure, about eating the seed corn, declining marginal productivity of debt, etc. If you break a window, it does add to GDP. This is not a recommendation to break windows. It is a damning indictment of GDP as a measure.

Where tyranny, socialism, and central planning (we repeat ourselves) are on the rise, not only liberty and human happiness wither, but so does the ability of people to coordinate their productive activities. A major theme of Keith’s dissertation is that government intervention promises improved outcomes, but always reduces coordination.

Others, especially Ayn Rand, have noted that socialism sets man against man. They can no longer cooperate to enrich each other. So they are forced to squabble to loot each other through the apparatus of the state.

This is a formula for misery even in a primitive agricultural economy. Wherever it has been adopted, it has been lethal not just to those who think independently, but even to millions of loyal supporters of the regime. The death toll of the socialist regimes of the 20 th century—both international and national, i.e. communist and fascist—was in the hundreds of millions.
Trust is Delicate

It is also a formula to destroy trust between people. Trust is a necessary element for people to coordinate their activities, especially over time. There could be no mass produced food, much less computer chips, without both banking and equities markets.

In a world where no one trusts anyone else, everyone hoards their favorite commodity at home. They fear to give it to a fraudulent bank who will steal it. So, instead of financing business, production, inventory, trade, and entrepreneurialism, they simply accumulate salt or silver or gold.

This is a picture of a miserably poor society, composed of small farm villages where life is barely above subsistence. And businesses are nothing more than a one- or two-man workshop. Think of Medieval Europe prior to the Italian Renaissance.

What is now called the developing world is significantly better off than this. That’s because developed markets have produced goods that are so cheap that even laborers in India, even farmers squatting in a rice paddy can afford mobile phones (though not plumbing or toilets). Life all over the world will degrade back to the level of poverty that long prevailed—if the lights go out in the West.

Many in the gold community wish for everyone to dump their savings and investments, buy gold and silver metal, and take the metal home to put it under the mattress. It is true that, if even a small percentage of people did this, the prices of gold and silver would skyrocket. These gold owners focus on this, but not on what we describe above. We have said before that they should be careful what they wish for, so we will not dwell on that point further here. We have a different point to make today.

For the reasons of creeping central planning, socialism, government intervention in all markets, and artificial conflicts of interest between groups, there is a worldwide megatrend of declining trust. Keith describes a collapse in trust as one of the eight indicators of financial implosion in his dissertation: “(8) the willingness of people to trust one another falls to zero.”

This trend necessarily occurs so long as government interferes with production, and renders people less and less able to coordinate. Much has been written about how the banks privatize gains and socialize losses. Deposit insurance, not to mention central bank lenders-of-last-resort, provide a moral hazard to ignore risk and bet big with Other People’s Money. More recently, they are starting to enact policies that provide for bail-ins. This is when depositors lose their deposits and instead get (possibly worthless) shares in the bank.

Rational Response to Irrational Social System

Something makes our mission, to reverse the trend and save civilization, damnably frustrating. That is, it’s an entirely rational response of the individual to withdraw his trust when others demonstrate they are untrustworthy. It is entirely rational to withdraw his capital when counterparties demonstrate they are putting it at undue risk, or paying insufficient or negative real returns.

As an aside, by real return, we do not mean measuring the consumer price index and subtracting from the interest rate. Prices are measured in money. Money cannot be measured in prices. If you empty a bag of gummy bears, and line them up, you can measure the line with a steel meter stick, e.g. 500mm. You cannot invert this and say the meter stick is two bags-of-gummy-bears long.

We measure real returns in money terms—i.e. gold. If you have $1,200 and earn 3% interest on, then at the end of a year you have $1,236. However, if the gold price goes to $2,472 (we do not predict this, but for sake of easy math), then you have gone from 1oz of gold capital to 0.5oz. You have lost 50%. You would have been (far) better off, to have a gold Krugerrand under the mattress.

We won’t even talk about having gold vs. being an involuntary volunteer for a bail-in.

So how do you fix a problem caused by people rationally responding to the perverse incentives imposed by an irrational system? You must offer them different incentives. You must appeal to their rationality, to their self-interest to trust, to invest.

- Source, Sprott Money

Saturday, November 24, 2018

Erik Townsend: No End In Sight To This US Dollar Rally?

Jason Burack of Wall St for Main St interviewed returning guest, former software and technology entrepreneur, hedge fund manager and host of the popular Macro Voices Podcast for sophisticated investors, Erik Townsend.