TedWeir

Originally Posted by TedWeir

Market Conditions Extremely Gold-and-Silver Friendly

Until U.S. real estate turns, the U.S. economy is growing at structural stall speed. Until we see consecutive monthly rises in the Case-Schiller Home Price Index, policymakers—led by the Federal Reserve Board, the U.S. Congress, the European Central Bank, the People's Bank of China and every other individual who has never met a payroll in their lives—are going to embark on policies that are extremely gold-and-silver friendly. The Fed announcement Tuesday afternoon turned markets sharply higher, thus reinforcing my comments back in May that we will see as many periods of quantitative easing as necessary until the real estate market in the U.S. (and Europe) improves.

Now—as for the gold stocks—NEVER in my 35 years in this industry have I ever seen them so incredibly disconnected from the underlying commodity that they produce. In the past 72 hours, the fundamentals for this industry group absolutely

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Originally Posted by TedWeir

Perhaps someone should staple the following latest poll from Reuters/Ipsos to the office door of the Fed chairman in the Marriner Eccles building, according to which a record number of people or 73% of all Americans, believe the economy is headed in the wrong direction. This is the highest number measured since the poll started its survey in February of 2009. Only 21% believe the US is on the right track: we assume these are the few people who actually made money in the stock market in the past few months, in other words those long various precious metals [/sarcasm]. Additionally, 47% of respondents believe the worst is yet to come for the economy, the highest since the March 2009 low when the number was 57%. Furthermore, Obama's approval rating dropped from 49% to 45% over the past month. Perhaps it is time to kill Osama for the 3rd (or is that 4th?) time. Bottom line: pessimism is now at or near fresh all time highs. And this is the environment in which the true viceroy

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Originally Posted by TedWeir

By Sheryl Nance-Nash

The stock-market roller coaster has been wild enough to make even the most stoic, stiff-necked investors queasy. After falling in 10 out of the last 11 trading sessions, the stock market plunged more than 500 points Thursday, making it the worst day for the Dow since Oct. 22, 2008, the day that marked the beginning of the global financial crisis. On Thursday, the index lost 4.3% -- erasing all the gains for the year -- to end at 11,384.

What's stoking the volatility? The U.S. dodged the default bullet, but not everybody is impressed. "The negotiated debt-ceiling settlement is being seen by world's financial markets as a smoke screen," says James DiGeorgia, publisher of the Gold and Energy Advisor newsletter. "No matter how many times my fellow Republicans repeat the mantra that Washington has a spending problem, not a revenue problem, the truth is we cannot make a dent in the national debt unless we reduce spending and raise

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Originally Posted by TedWeir

Gold in USD terms is 2.4% higher and is higher against all currencies and trading at USD 1,760.40 , EUR 1,234.10 , GBP 1,075.70, CHF 1,306.80 per ounce and 132,719.00 JPY.
Gold’s London AM fix was USD 1,770.00, EUR 1241.75, GBP 1080.98. Gold reached new record nominal highs at $1,780.10/oz and new nominal highs in euros and sterling also this morning.

Cross Currency Rates
Asian equities were mixed with sharp falls seen on the Hang Seng but the Nikkei recovered to only finish down 1.7% and the Chinese and Australian stock markets actually managed to rise on the day.


The FTSE, DAX and CAC are down 0.7%, 1.9% and 0.2% respectively but US futures are showing tentative gains.


There were further signs of stagflation in the UK as manufacturing unexpectedly fell in June and the trade gap widened. This is further

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Because we all need a laugh after the latest confirmation that the Fed has completely failed at restoring economic growth. Incidentally this anecdote also explains why the S&P doubled in the last two years.
Courtesy of John Lohman

The S&P will have a lot of farting to do if Jon Hilsenrath does not leak QE3 post haste.


Read source article here

Before we move on from today's atrocious GDP number, we are presenting the one firm whose macroeconomic opinion we truly respect: Stone McCarthy, and yes we will make an exception for Goldman's comments because we are delighted to recall how Jan Hatzius predicted a new golden age for the US economy as recently as December 1 (read at: "Goldman Jumps Shark, "Fundamentally" Shifts Its "Bearish" Outlook On Economy: Goes Bullish, Hikes Outlook"). Because every documented incident of failed "shark jumping" deserves the proper amount of gloating.
But back to SMRA:

Key Take-Aways:

1) Headline GDP--Unrevised at +1.8%, But Important Compositional Revisions
2) Surprising Downward Revision to PCE, Points to Weaker Aggregate Demand
3) Upward Revision to Inventories Points to Lower Inventory Building Ahead
4) Net GDP Revision Points to a Slower Trajectory of Growth than Apparent Earlier

The Second Estimate of Q1-11 GDP revealed a 1.8% rate of gain

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The recently released Presentation to the Treasury Borrowing Advisory Committee (consisting of a 13-member committee of bond dealers and investors that meet quarterly with Treasury officials), which somehow managed to slip by under the radar, is a must read for anyone curious about the funding ability of the US government. A closer examination (and it is chock-full of must read observations) reveals far more conclusively than whatever today's budget myth may reveal, the US is truly in a dead-end situation, and that there is no way the Fed can now possibly step away from indefinite future debt monetization. And the stunner that nobody has yet mentioned: the US is actually considering GDP-linked bonds: the last recourse of a country about to go bankrupt.
Some of the key charts:
Cutting straight to the chase, interest expense on the US debt, which in 2010 was below $200 billion is expected to jump to $800 billion in 2020. Luckily, the Fed will own pretty much all the ...

repost from zerohedge.com:
Scott Minerd's Detailed Pre-Mortem On What Europe's Bank Run Will Look Like, And Other Observations


We traditionally enjoy the periodic letters by Guggenheim's CIO Scott Minderd. His latest piece, "The Opening Act to the Broader Crisis" is no exception. In it, the strategist dissects the European crisis, compares it to the subprime debacle and sees it as the precursor to the eventual downfall of the euro, a surge in the dollar, the "federalization" of Europe and the adoption of QE by the ECB. The key must read item in the current report is Minerd thought experiment of what a wholesale bank run, first in Ireland, and then everywhere else in Europe, would look like. This is especially important as one could, as Scott claims, start at any moment. What does this mean for investments? "If we are on the brink of crisis in Europe, which I believe we are, then there are several expectations we can draw about the investment landscape. ...