Why in the world has JP Morgan accumulated more than 55 million ounces of physical silver? Since early 2012, JP Morgan’s stockpile has grown from less than 5 million ounces of physical silver to more than 55 million ounces of physical silver. Clearly, someone over at JP Morgan is convinced that physical silver is a great investment. But in recent times, the price of silver has actually fallen quite a bit. As I write this, it is sitting at the ridiculously low price of $15.66 an ounce. So up to this point, JP Morgan’s investment in silver has definitely not paid off. But it will pay off in a big way if we will soon be entering a time of great financial turmoil.
During a time of crisis, investors tend to flood into physical gold and silver. And as I mentioned just recently, JPMorgan Chase chairman and CEO Jamie Dimon recently stated that “there will be another crisis” in a letter to shareholders…
All those angered by the mere question of the viability of this predatory pillaging in the name of capitalism are incapable of even admitting this cultural crisis exists.
Somewhere along the line, we lost the ability to distinguish between earning a profit and maximizing private gain by any means, i.e. Infinite Greed. If you insist on making this distinction now, you anger a lot of people, as it blows the capitalist cover of Infinite Greed.
The distinction between earning a profit and maximizing private gain by any means angers not just the few benefiting from the useful delusion that Infinite Greed is simply profit on overdrive; it seems to anger everyone who believes the Status Quo of burning mountains of coal to power towel warmers, sitting in traffic burning petrol two hours a day and central banks enriching the already wealthy is not just sustainable but gol-darned good. ...
Financial writer Bill Holter says you can forget what the experts says about “containing” the Greek debt crisis. Holter contends, “Contained is famous last words. This cannot be “contained.” Greece is the canary for the entire world. The western world is Greece. The western world is massively in debt. There are derivative losses all over that place that are being hidden, and Greece is what sets off the realization that there are losses and the chain has broken.”
Holter goes on to say, “You have to understand that there are layers to this. The German banks, the French banks, the Greek banks and many of the various European countries’ banks hold Greek debt. They also hold
Claiming to own X quantity of gold is one thing, and reporting how many times the gold has been pledged as collateral is another.
When correspondent Scott A. Batten offered to write an explanation of the rehypothecation of gold and why it matters, I quickly accepted. Like many others, I have breezed over the word rehypothecation with the basic understanding that it means assets pledged by counterparties (such as the infamous copper stored in Chinese warehouses) are reused as collateral/repledged--in effect, the same assets are pledged as collateral multiple times.
But beyond this, I have not had a clear understanding of how the rehypothecation of gold reserves threatens the whole shaky edifice of Infinite Greed, oops, I mean neoliberal capital markets.
If enough people truly believe that things will get better, will that actually cause them to get better? There is certainly something to be said for being positive and thinking that anything is possible. And as Americans, optimism seems to come naturally for us. However, no amount of positive thinking is ever going to turn the sun into a block of wood or turn the moon into a block of cheese. Any good counselor will tell you that one of the first steps toward recovery is to stop being delusional and to come to grips with how bad things really are. When we deny reality and engage in irrational wishful thinking, we are engaging in something called “hopium”. This is a difficult term to define, but the favorite definition of hopium that I have come across so far goes like this: “The irrational belief that, despite all evidence to the contrary, things will turn out for the best.” In hundreds of articles, I have documented how the U.S. economy is mired in a long-term decline which is about to get a lot worse. But most Americans see things very differently. In fact, according to a brand new CNN/ORC poll, 52 percent of Americans describe the U.S. economy as “very” or “somewhat good”, and more than two-thirds of all Americans believe that the U.S. economy will be in “good shape” a year from right now. But if you asked most of those people why they are so optimistic, they would probably mumble something about “Obama” or about how “we’re Americans and we always bounce back” or some other such gibberish. Well, it’s wonderful that so many people are feeling good and looking forward to the future, but are those beliefs rational?
Back in 2011, Zero Hedge first asked the key question that matters to the gold market: what are China's true holdings of physical gold.
As is well known, the last time China did provide an update of its official gold inventory was in early 2009 when it disclosed to the IMF some 1,054.1 tons of gold held at the PBOC headquarters (or elsewhere). The problem is that this number is now very outdated, and substantially undercuts China's true gold holdings.
To be sure, there has been extensive speculation on the topic, suggesting China's current gold may be anywhere between 3,000 and 8,000 tons (or more) but the reality is that until Beijing itself decides to officially reveal the number, speculation will remain just that. And, as we and many others, Bloomberg included, have noted such a revelation will not come in a vacuum, but will be largely a political statement about the preparedness of the Renminbi to replace the US Dollar as the world's reserve currency.
Back in 2011, a leaked cable (courtesy of Wikileaks) admitted as much:
The combination of U.S. economic growth concerns along with the rising risk that Greece will default on its debt obligations in the coming months, should see gold rally to highs near $1,300 an ounce sometime in Q2-2015 -- monetary policy trends, safe-haven buying should prompt specs to cover short exposure and build new longs, with technical positioning providing the path to the higher target.
The BRICS New Development Bank and the Asian Infrastructure Investment Bank (AIIB), both seen as alternatives to US – led institutions, will not compete, but rather complement each other, said the head of the Central Bank of Russia Elvira Nabiullina.
Nabiullina made the statement Thursday in Washington where she is attending the spring meetings of the International Monetary Fund and World Bank.
"I don't think there's less energy (around the BRICS bank). We didn't feel that. To the contrary, all the representatives of all the countries ... were very motivated to reach speedy practical results," she said.
You’re likely thinking that a discussion of “sound banking” will be a bit boring. Well, banking should be boring. And we’re sure officials at central banks all over the world today—many of whom have trouble sleeping—wish it were.
This brief article will explain why the world’s banking system is unsound, and what differentiates a sound from an unsound bank. I suspect not one person in 1,000 actually understands the difference. As a result, the world’s economy is now based upon unsound banks dealing in unsound currencies. Both have degenerated considerably from their origins.
Modern banking emerged from the goldsmithing trade of the Middle Ages. Being a goldsmith required a working inventory of precious metal, and managing that inventory profitably required expertise in buying and selling metal and storing it securely. Those capacities segued easily into the business of lending and borrowing gold, which is to say the business of lending and borrowing money.
Most people today are only dimly aware that until the early 1930s, gold coins were used in everyday commerce by the general public. In addition, gold backed most national currencies at a fixed rate of convertibility. Banks were just another business—nothing special. They were distinguished from other enterprises only by the fact they stored, lent, and borrowed gold coins, not as a sideline but as a primary business. Bankers had become goldsmiths without the hammers. ....
As people continue to digest breaking news out of Greece and around the world, the Godfather of newsletter writers, 90-year-old Richard Russell, warned that China and the super wealthy are preparing for something big but silver will surprise everyone.
Richard Russell: "Negative news is coming out about the US economy. The result will be the Fed will put off raising rates to as far as the eye can see. If the economy continues to deteriorate, we might even see QE4 as the Fed struggles to offset a declining US economy. My advice continues to be: buy and accumulate physical silver and gold.
Just like in the world of fashion, economic terminologies come in and out of vogue. One such economic term trending recently is Secular Stagnation. First proposed by Keynesian economist Alvin Hansen back in the 1930s, Secular Stagnation was coined to explain America's dismal economic performance -- in which sluggish growth and employment levels were well below potential. The term is now back in style thanks to the likes of the contemporary heroes of Keynesian economics, like Larry Summers and Paul Krugman; and is based on the notion that a chronic savings glut has resulted in the economy operating well below potential. The notion that the developed world is trapped in some type of stagnation is something I can agree with. However, the reasoning offered for this stagnation completely dismisses the role of central banks and assumes low growth and interest rates are instead being driven by those pesky savers.
by Lawrie Williams I have just published an article on Mineweb which looks a little more deeply at the possible impacts of the Chinese yuan becoming part of the IMF’s Special Drawing Right basket en route to it being acceptable as a global reserve currency. This seems to be China’s aim, but we don’t see how it can happen without some major currency structural changes, and these could have a very significant impact on the future of global trade and on gold and it could force China to announce the long awaited uprating of its gold reserve this year – as many have speculated it will.
We see any move to bring the yuan into the SDR basket as necessitating China decoupling the yuan from the US Dollar. The SDR basket is made up of a mix of currencies – the dollar, euro, pound sterling and yen, the idea being that between them this provides broad stability in the SDR’s value over time and that bringing in a currency which is tied to one of the others already in the basket would defeat the overall objective! Thus to participate in the SDR we suggest that China will have to drop the currency peg to the dollar and allow it to float freely. ...
I was listening to your podcast with the Silver Doctors today and I found it very helpful the way you explained the derivatives problems. I have been reading Zerohedge for several years and even searched youtube on the subject but you cleared up a lot of the confusion for me. – reader response from “Lawrence”
Eric Dubin of The News Doctors and “Doc” of Silver Doctors invited me on to their weekly “Metals & Markets” show this past week. Rather than reinvent a wheel that has already been manufactured, here’s Eric Dubin’s perfectly good wheel that accompanies the podcast:
Dave Kranzler published a grand slam article last week (click here). Doc and I were happy he could join us to discuss what I consider to be smoking gun proof that there is a low grade fire burning in the derivatives market, and it could flare-up into a crisis at any time. You owe it to yourself to read the article, and for more context listen to our discussion. ...
China To Reveal The Size Of Its Gold Hoard This Year
Turning to China, its GDP will soon eclipse the US’s GDP. Personally, I don’t think China wants to surpass the US and be the new leader of the world. I think China wants to be on par with the US. We don’t know how much gold China has, but we do know that China is continually accumulating gold. It’s been a few years since China has told the world the size of its gold hoard. Before this year is out, I believe China will reveal its gold position.
(CNSNews.com) - According to the Daily Treasury Statement for Wednesday, April 22, which was published by the U.S. Treasury on Thursday, April 23, that portion of the federal debt that is subject to a legal limit set by Congress closed the day at $18,112,975,000,000—for the 40th day in a row.
$18,112,975,000,000 is about $25 million below the current legal debt limit of $18,113,000,080,959.35.
Tuesday April 21, 2015, 10:47am PDT iNVEZZ.com reported that Bank of America Merrill Lynch Global Research believes the silver price has made it “through the worst.” However, the entity doesn’t expect it to break out of its current price range in the near future.
A catalyst for silver demand in the future will be China’s energy sector, which may lend some price support.
As quoted in the market news:
Silver is key to building photovoltaic generators, which produce usable solar energy, and China plans a major expansion of its use of solar power into the future, the advisory argued ...
Trader/analyst Rick Ackerman says forget about the demise of the U.S. dollar anytime soon, Ackerman contends, “I have been totally bullish on the dollar for years, and it looks like clear sailing to me. The dollar is certainly responding to what I would call economic fundamentals, even though bonds have been on this odd holding pattern for a while based on a wishy-washy Fed. I see nothing but a strong dollar because if you look at the global derivative market, it implies a dollar long and a dollar short position. . . . The side that has to pay back in dollars is effectively short it. So, we have this monstrous derivatives market, and some experts put it at a quadrillion and a half dollars, and it represents a huge short position on the dollar, and the squeeze is starting to happen now.”
April 21 (Hard Assets) — Despite recent relaxations on gold import norms by the Central government, gold smuggling continues unabated at Indian airports.
The data released by the Directorate of Revenue Intelligence (DRI) under the India Customs Department shows that gold smuggling acts at Sardar Vallabhbhai Patel International Airport in Ahmedabad have touched record level during the initial four-month period in 2015.
According to DRI statistics, 18 cases of gold smuggling were reported during the four-month period from January to ...
Click through for the rest. Pretty interesting to me that smuggling continues to be a priority for a lot of people when it comes to gold.
The People's Bank of China may have tripled its gold stockpile since April 2009, when it last gave an official number, which Bloomberg Intelligence estimates to be 3,510 metric tons, second to United States 8,133.5 tons of gold.
The figure, almost triple the 1,054 tons of gold reported in 2009, was calculated based on trade data, domestic output, and China Gold Association figures by Bloomberg Intelligence.
China, which only reports its gold stockpiles every few years, made a similar move between 2008 and 2009, when it just about doubled the bullion stock. Including gold, China is estimated to have $3.8 trillion in currency reserves, which are also kept secret.
Get ready for another major worldwide credit crunch. Today, the entire global financial system resembles a colossal spiral of debt. Just about all economic activity involves the flow of credit in some way, and so the only way to have “economic growth” is to introduce even more debt into the system. When the system started to fail back in 2008, global authorities responded by pumping this debt spiral back up and getting it to spin even faster than ever. If you can believe it, the total amount of global debt has risen by $35 trillion since the last crisis. Unfortunately, any system based on debt is going to break down eventually, and there are signs that it is starting to happen once again. For example, just a few days ago the IMF warned regulators to prepare for a global “liquidity shock“. And on Friday, Chinese authorities announced a ban on certain types of financing for margin trades on over-the-counter stocks, and we learned that preparations are being made behind the scenes in Europe for a Greek debt default and a Greek exit from the eurozone. On top of everything else, we just witnessed the biggest spike in credit application rejections ever recorded in the United States. All of these are signs that credit conditions are tightening, and once a “liquidity squeeze” begins, it can create a lot of fear.
"There is a mysterious cycle in human events. To some generations much is given. Of other generations much is expected. This generation of Americans has a rendezvous with destiny."
Franklin D. Roosevelt, 1936
In the tripolar world of Europe, US, and East Asia, Russia may play a pivotal role in a fourth sphere of influence.
Europe and the US are pressing heavily on its western borders, trying to limit Russia to Western Asia.
Thus I have said that if the push for one world corporatist government under the dollar banner falters, Russia may play a pivotal role in the composition of influences and the struggle for power that will follow. ...
ABN AMRO expects Chinese demand for gold and precious metals to rise further in the coming years, although the anti-corruption campaign may temporarily distort long-term trends. Chinese Gold, Silver demand to rise further in coming years: ABN AMRO
India's gold imports surged by 93.86% to $4.98 billion in March as compared to $2.57 billion in the same month last year mainly due to declining prices and easing of restrictions by the RBI. Nation's silver imports also advanced about 4.5 times, from $121.4 million to $561.4 million.
Sharing your scoops to your social media accounts is a must to distribute your curated content. Not only will it drive traffic and leads through your content, but it will help show your expertise with your followers.
How to integrate my topics' content to my website?
Integrating your curated content to your website or blog will allow you to increase your website visitors’ engagement, boost SEO and acquire new visitors. By redirecting your social media traffic to your website, Scoop.it will also help you generate more qualified traffic and leads from your curation work.
Distributing your curated content through a newsletter is a great way to nurture and engage your email subscribers will developing your traffic and visibility.
Creating engaging newsletters with your curated content is really easy.