For decades many of us in the hard money world have speculated that cloak and dagger activity by large financial interests has played a large role in determining performance in the gold market. The focus of this alleged manipulation is believed to be in the London market, and has been widely referred to as "The London Fix." However those who have blown the whistle have been dismissed as alarmists, gold bugs, conspiracy theorists or worse. But recent revelations should bring us closer to the truth.
Richard Russell - The Cheapest Thing On The Planet Is Silver With continued turmoil and uncertainty in global markets, today KWN is publishing another important piece that was written by a 60-year market veteran. The Godfather of newsletter writers, Richard Russell, says that he is buying physical silver because it’s “dirt cheap.” Russell also warned that the gold/silver ratio may plunge from 66/1 down to 16/1. This means the price of silver would more than triple the upside surge he expects for gold.
FTMDaily.com – As the West continues to unleash its anger against Russia’s recent military moves, Vladimir Putin has intensified his diplomatic efforts with a rising China. After a decade of talks, Mr. Putin is expected to announce a broad plan to export vast amounts of natural gas to China during an official state visit to China next month. If Mr. Putin can seal the deal it will be another major victory for the BRICS nations and will provide yet another nail into the coffin of the failing U.S. dollar.Of course, both sides are facing intense pressure from the West to abandon the deal. China, however, seems intent on pushing closer to Russia. Russia, in particular, is under the threat of more Western sanctions for its recent role in Ukraine. So too, Western sanctions are targeting Russia’s state-run energy company, Gazprom. Gazprom’s response to these sanctions shows just how close we are to the end of the petrodollar system…From the Financial Times, a story entitled: Gazprom Looks to Drop the Dollar to Avoid Sanctions’ Bite: The oil arm of Russia’s state-owned Gazprom is preparing customers to settle contracts in euros rather than dollars as it braces for the possible escalation of US sanctions against Moscow.
Futures are treading water once more now that Ukraine has stormed to center stage from the backburner after everyone was convinced Putin would let the situation cool off after annexing Crimea. Guess not. Adding the renewed geopolitical jitters to what has already been a beta stock bloodbath into a holiday shortened week assures some high volatility fireworks. Cautious sentiment was observed over in Asia (Nikkei 225 -0.36%) amid renewed fears that geopolitical tensions in Ukraine will flare up again following reports of exchange gunfire with pro-Russian militants. This sentiment carried over into the European session with stocks lower across the board (Eurostoxx50 -0.71%). EUR is lower after ECB’s Draghi said any further strengthening of the EUR would warrant further action by the ECB, including non-standard measures such as quantitative easing - it is amazing how frequently and often the Virtu algos still fall for Draghi's jawboning trick which has now become all too clear will never be implemented and certainly not if he keeps talking about it daily, as he does.
Taxpayers are paying billions of dollars for a swindle pulled off by the world’s biggest banks, using a form of derivative called interest-rate swaps; and the Federal Deposit Insurance Corporation has now joined a chorus of litigants suing over it. According to an SEIU report:
Derivatives . . . have turned into a windfall for banks and a nightmare for taxpayers. . . . While banks are still collecting fixed rates of 3 to 6 percent, they are now regularly paying public entities as little as a tenth of one percent on the outstanding bonds, with rates expected to remain low in the future. Over the life of the deals, banks are now projected to collect billions more than they pay state and local governments – an outcome which amounts to a second bailout for banks, this one paid directly out of state and local budgets.
It is not just that local governments, universities and pension funds made a bad bet on these swaps. The game itself was rigged, as explained below. The FDIC is now suing in civil court for damages and punitive damages, a lead that other injured local governments and agencies would be well-advised to follow. But they need to hurry, because time on the statute of limitations is running out.
One of the most extraordinary stories in the history of American journalism took place this last week, and the mainstream (liberal) media was AWOL the entire time. An historical showdown between heavily armed federal agents (BLM) and armed American citizens unfolded near Bunkerville, Nevada, where the Bundy family announced they were taking a stand against a federal land grab and cattle theft operation masterminded by federal agents working at the BLM.The showdown ended in a complete victory for Citizens vs. government tyranny as the feds effectively surrendered, announced their evacuation and agreed to release all the cattle they had stolen. See the photo below for a snapshot of the history the mainstream media stupidly decided to ignore.
We have been on alert for the last few weeks as the financial markets are faltering. Not necessarily on the surface, as new all-time highs were put on the board in the past few weeks, but the wood is starting to show through the paint. Underneath the surface, there are a few things that do not make us feel very comfortable. It is not a feeling we are used to, as we have been positive on stocks in general since late 2010 due to the monetary inflation. Three years later, however, there are a few factors that have caused some raised eyebrows, including ours.
With the end of a wild week of trading coming to a close, today one of the great veterans of the gold world sent King World News an extraordinary piece covering the remarkable events we are seeing take place in the war on gold, as well as a stunning look at the big picture for this key market. Below is the outstanding piece, which includes 5 fantastic charts, by John Hathaway of Tocqueville Asset Management.
Americans are increasingly feeling the heat from their own government, and they are starting to see the manifestation of their own worst fears; those predicted by visionaries such as George Orwell.
Federal agents with the Bureau of Land Management (BLM) attacked a group of protestors this week in rural Nevada, using tasers, dogs, and even moving vehicles to strike people who oppose the BLM's policies toward historic cattle ranch practices. The ranchers say their animals are being killed and starved on BLM property and protestors with the 140-year old Bundy Ranch say their anger was elevated when federal officials arrived with a dump truck and a back hoe to, they believe, dispose of the dead and dying cattle.The BLM troops are not only attacking local non-violent protestors and denying them information, they also specifically and directly violated their Civil Rights by establishing what they called a "First Amendment Zone" - thus denying the Bundy protestors one of the most basic civil liberties, the right to peacefully assemble.The US First Amendment states, "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.
After years of successfully ranching in California, Wayne & Jean Hage (she is now deceased) purchased a large cattle ranch in Nevada, Pine Creek Ranch, in the spring of 1978. The acreage involved is approximately 752,000 acres. However, as it is mostly desert land, the land's ability to support cattle is far less than might be supposed from its size.
Located in the high desert mountains of central Nevada, the remote operation seemed an unlikely place for a war that would rock the very foundation of federal land management agencies. Wayne purchased the operation from the well-respected Arcularius Brothers who sold the ranch because the regulatory pressure by the U.S. Forest Service had become unbearable. Since Wayne had always been able to work with the agency, he believed he could resolve problems that might occur. Wayne soon learned the only way he could satisfy the Forest Service was to allow them to confiscate his property.
The financial world is in uproar over controversial claims that high frequency traders are rigging stock markets.
A cohort of US financial firms are being accused of using speed - an advantage of just a few thousandths of a second - to fleece big money rivals and by extension ordinary savers and investors.The allegations made in Flash Boys: Cracking the Money Code by Michael Lewis have prompted the US Justice Department to say it is probing high-speed trading for possible insider trading violations. The FBI and US financial watchdogs are also investigating the industry.The book focuses on Wall Street share trading, but one City insider has commented: 'The same players are in the UK and Europe – if it’s happening in America, it’s happening here too.'Detractors, spearheaded by Lewis, believe high frequency trading firms are deploying a host of strategies which exploit speed - literally a few milliseconds, less than the blink of an eye - to jump in on share trades and manipulate prices in their own favour.
This rejoinder was prompted by the Daily Bell interview with Bill Murphy of GATA (March 30, 2014).
I shall accept, for the sake of argument, Murphy’s premise that the dollar price of gold is heavily manipulated by the U.S. government in order to keep it in check. But while Murphy thinks that it is a great curse I shall argue, tongue in cheek, that it is a blessing in disguise. The difference between Murphy’s thinking and mine is the difference in financial survival strategies in the face of the U.S. government’s deliberate policy of destroying the dollar and, along with it, the savings and pension rights of people, to say nothing about destroying the world economy.
The chief executive officer of a private bank in the alpine principality of Liechtenstein has been shot dead at the bank’s headquarters, according to reports. Liechtenstein police said Monday that a 48-year-old bank executive had been shot dead inside the underground car park of the bank’s headquarters. The report said the fatal shooting took place in the village of Balzers, located near Liechtenstein’s border with Switzerland. The police statement did not name the bank or the executive. Later on Monday, however, Swiss news outlet Schweizer Radio und Fernsehen (The Voice of Switzerland) identified the shooting victim as Jürgen Frick, CEO of Bank Frick. Headquartered in Balzers, the family-run bank was founded in 1998 as a private financial establishment. In addition to its Liechtenstein office, Bank Frick also maintains a branch in London’s Mayfair district, in the United Kingdom. Liechtenstein police said on Monday it was looking for a suspected gunman, identified as Jürgen Hermann, a former fund manager, who was spotted in the bank’s surveillance cameras around the time of the shooting. Hermann, who lives in Liechtenstein’s Mauren municipality, was also seen fleeing the scene of the crime in Smart car. Swiss media later reported that Hermann describes himself on his personal website as “the Robin Hood of Liechtenstein” and as the tax-haven’s “public enemy No. 1”. German media said Hermann has been involved in longstanding feuds with the government of Liechtenstein over “financial issues”. In his website, the suspected shooter has uploaded statements demanding that the government of Liechtenstein returns to him “investments worth millions”, which were allegedly “destroyed by the financial mafia of Liechtenstein”. The principality’s police say they found Hermann’s driver license and passport thrown by the side of a road near the river Rhine, and suspect that Hermann might have killed himself. They also say Hermann’s passport included “handwritten notes” confessing to killing Frick. Several private banks in Liechtenstein, including LLB and LGT Group, two “no-questions-asked” banks owned by the Royal family of the tiny alpine tax haven, have come under scrutiny in recent years, as governments around the world accuse the tiny principality of inviting deposits from money launderers and criminal syndicates. Meanwhile, Frick Bank remained closed on Monday due to the shooting, according to reports.
Today one of the top CEO’s in the world told King World News that the price of gold will break $2,000, in spite of the fact that the price being actively “managed.” This interview is tremendous and it will let KWN readers around the world see the gold market through the eyes of one of the greatest and well-respected veterans in the business. Below is what Sean Boyd, CEO of $5.4 billion Agnico Eagle, had to say in his powerful interview.
Financial newsletter writer Dr. Jim Willie thinks 2014 will be a pivotal year for the U.S. Dr. Willie says, “We’re going to end this year with no resemblance to the beginning. We spent a lot of years trying to hold this thing together. The whole system broke in 2007 and 2008 with the subprime mortgages. I was saying before that we’ve got the entire U.S. economy depending on the housing bubble and the mortgage finance bubble, and when that breaks, the system is going to break. In the following couple of years, it continued to break. What did we do? We went to zero percent interest rates and made it pretty clear it’s forever. What else did we do? We did bond monetization, QE. I love QE, it makes it sound like CPR. It’s death. It’s hyper-monetary inflation. It’s what Nazi Germany did . . . it wrecked everything. These are desperation measures to hold it together because the system is broken.” Dr. Willie, who holds a PhD in statistics, contends, “Now all the QE and bond purchases are causing some major problems, breaking major economic structures. . . It’s all breaking, it’sall breaking, and they are having a tremendous problem holding it together. Now, the whole Eastern World is rebelling against the dollar.”
Editors Comments: - As many of you know, I was born and raised in Rhodesia (now Zimbabwe) and fought in the war there from 1973 through 1980 aginst the terrorist armies of Robert Mugabe and Joshua Nkomo, who were backed by Russia, China and North Korea. China has a huge population and is struggling to keep them down as they get used to a more westernized standard of living, and one way that this is happening is with Chinas’ work in African countries like Zimbabwe, where the natural resources are being raped and pillaged and sent out to China and nobody but the higher echelon in the Mugabe Government benifits, certainly not the people. (Robert Mugabe is one of the richest men in the world whose fortune has been obtained soley at the expense of his people) The Chinese have poured money (read loans that are unpayable but secured on natural resources like precious metals, woods, diamonds, etc) and are now reaping the results. China owns Zimbabwe and many other African Countries and is on the way to owning the United States of America. We need to wake up and understand the real threat to our national security from the financial ties to China, because they will do anything they need to do to keep the people there down. Just my opinion America, Fred Brownbill.
With continued turmoil and uncertainty in global markets, today KWN is publishing another important piece that was written by a 60-year market veteran. The Godfather of newsletter writers, Richard Russell, is urging people to buy physical silver because something is “brewing” in the silver market. Russell also discussed shorting stocks and included a a fascinating chart of the silver/gold ratio.
There are assumptions in this analysis that should be clear to all. But if it only serves to expose the futility of attempts in western capital markets to manage the gold price, the exercise has been worthwhile. For much of 2013 commentators routinely stated that Asian demand was satisfied from ETF redemptions. But as can be seen, ETF sales totalling 881 tonnes covered only one-quarter of the west’s shortfall against China, the rest coming mostly from central bank vaults. - Alisdair Macleod, Renewed Estimates of Chinese Gold Demand (link
This is an incredibly crucial time. What I have called the most dangerous time in human history for capital.
You could end up doing almost everything right in the end and still losing everything.'How?' You ask.If you realize that what is forthcoming will be a complete political, monetary and financial reset... as the evidence seems to indicate... and move your wealth completely into precious metals as would normally work... you could still lose everything. The key word in the last sentence was "political". If you, for example, are an American with all of your assets inside the US and you make the highly rational and logical decision to move into history's safe havens, gold and silver, you could still end up with nothing.
While simplistic economist hacks and conflicted industry practitioners who stand to lose their entire revenue stream should HFT be liquidated, not to mention pagreview trolling journos, are suddenly not only experts in HFT, but are convinced allegations that high frequency trading rigs markets are blown out of proportion, here is what one of the actual pioneers of, and erstwhile legends in, computerized trading - the billionaire founder of Timber Hill and Interactive Brokers Thomas Peterffy - the man NPR dubbed the "father of high-speed trading" has to say.
On the heels of continued chaos and uncertainty around the globe, today a 40-year market veteran sent King World News an incredibly powerful piece discussing the ongoing corruption in the Western world as well as a possible kill shot on the U.S. dollar. This is an extremely timely and fascinating piece from Robert Fitzwilson, founder of The Portola Group. Below is what he had to say in this exclusive piece for King World News.
I have been revisiting estimates of the quantities of gold being absorbed by China, and yet again I have had to revise them upwards. Analysis of the detail discovered in historic information in the context of China's gold strategy has allowed me for the first time to make reasonable estimates of vaulted gold, comprised of gold accounts at commercial banks, mine output and scrap. There is also compelling evidence mine output and scrap are being accumulated by the government in its own vaults, and not being delivered to satisfy public