Global Financial System Headed For Major Disaster In 2015

Today a man who has been involved in the financial markets for 50 years warned King World News that the world is headed for a major disaster 2015.  John Embry, who is business partners with billionaire Eric Sprott, said the global financial system will see enormous turmoil in the coming year as the Western central planners head further down the Orwellian path.

Embry:  “I have been focused on the counterintuitive trading in major markets as I look back on 2014 because it is at odds with the reality of the world scene.  It’s fascinating, but I feel that if World War III were to break out, the gold and silver markets would be trashed at the London opening and further abused when Comex opened for trading, while the U.S. stock market would be unchanged or even trade higher.  And the worse the news backdrop is, the further the Western central planners head down this Orwellian path….

“The repetitive behavior in the precious metals markets by the anti-gold cartel, led by Western central banks, orchestrated through the Bank for International Settlements and executed by the major bullion banks is beyond tiresome and will lead to a major disaster in the global financial system in 2015.

Plunge Protection Team At Work

At the same time gold and silver are being controlled, the Plunge Protection Team has created a severely overvalued U.S. stock market by supporting it irrespective of what the news backdrop is.  So we now have a lot of ‘hot’ money that has entered the market.  And by any metric I look at, this has led to the stock market being one of the most expensive, if not the most expensive market in history of the United States.

The reason for this activity in the precious metals market is abundantly clear to me at this point.  If gold and silver traded without severe manipulation in the massive paper markets, which dwarf the physical markets, the prices would be sharply higher.  I don’t think it would be unreasonable to say they would be at least twice the current prices and silver could easily be three times the current price — a level it already traded at for brief moment over 3 1/2 years ago.

The Great Illusion Must Be Maintained 

However, if this were to happen, the total fallacy of the central banks’ ridiculous monetary policy throughout the West and in China as well would be revealed.  Interest rates would also skyrocket and the obscene debt load in the world would implode.  That would also have an incredibly negatively impact on the U.S. stock market.

Nevertheless, this current monetary policy where central banks print whatever is required to keep things afloat is going to end in disaster.  I suspect we are heading for a global hyperinflation and this is the worst possible outcome because it is so corrosive for a society as a whole.  But this is the path that has been chosen, and with the alternative now being a 1930s-style debt liquidation and accompanying depression, I suspect that the central banks will continue on their mission to destroy fiat currencies globally.

The prime example of this is Japan, where things have gone from bad to worse and keep deteriorating even further on a weekly basis.  The Japanese savings rate has now plunged into negative territory, and this is after having massive savings for all of the recorded post-war history.  The government Debt/GDP ratio is by far the highest in the industrialized world.  The current fiscal gap is staggering, and real incomes are falling.  Abenomics in the fullness of time will be seen as total economic madness.”

Embry also added:  “The fact that gold and silver have been held under the boot of corrupt Western central banks just demonstrates that the pricing power still resides in a fraudulent paper market where there are at least 100 claims for every available ounce of physical gold.  When this great Ponzi scheme unwinds, and it most assuredly will, people had better make sure they own a lot of physical gold and the respective equities because the repricing of gold will create one of the most violent upside moves in history.”

http://kingworldnews.com/global-financial-system-headed-major-disaster-2015/

Why I Look Forward to 2015, with Relish

from The Wealth Watchman:

Time to Usher in the New Year

First of all, happy new year to all my shield brothers out there! All of you in this community have made this year such an amazing one for me, that I have to say, “thank you!” for it. As long as you keep sticking around, I’ll keep trying my best to patrol this wilderness of financial fraud, and fight for truth, beside you.

I know it’s been a difficult year for stackers in some ways, and a gift in others.  Nevertheless, it is that time again, and as another year goes into the history books, and a new, living year is about to begin, I thought I’d take stock of where we’re at on the larger picture for gold and silver.

Now, unsurprisingly, both of our metals are somewhat down for the year, for the 2nd year straight,and it seems, for psychological reasons, that our enemy is keen to make both of them close red yet again, which suites me just fine!

The banksters haven’t stopped there though!  They’ve ramped up the Dow Jones to its tip-toppiest, bubbliest high notes for the year, while every, single item in the commodity sector is being jack-hammered into the earth’s core.  They’re bound and determined that inflation won’t show itself at this stage of the game.

Central banks are hell-bent on re-inflating the housing bubble, the debt bubble, the stock market bubble, the derivative bubble, all while sucking any and all metrics of true measurement of their wicked schemes, down into the deepest hole in the proverbial swamp.

In 2011, a memo went out in the central banking world, which continues to be their same blanket policy toward precious metal stackers today:

They’ve turned us upside down, and shaken the tree we’re on with a bulldozer!  But we, being warriors all, have been hanging this way so long, that we actually prefer being upside down now!

Traditionally, traders have had a saying: the market can stay irrational longer than you can stay solvent.  

There’s a word for that phrase, which I can’t repeat, because there are ladies present, and because this is a family-friendly site!  Turns out though, that phrase was a crock to begin with, because the entire time that folks thought it was the “market” staying irrational, it was usually the Fed and central banks throwing good money after bad.  

A truer aphorism might be this:

The Fed can maintain its credit rating, longer than you can be right.

Yet, even after pumping their trillions, praising all their own handiwork, and “banging every close” with a Plunge Protection Team ramp in general equities, a roughly 9% gain is the best they’ve mustered all year on the Dow Jones.

It is all for naught!  Every bubble finds its pin, every time, without fail!

There are no more markets, only interventions, as Chris Powell wryly observed.  All this levitation isn’t the mystical creature, called “the market”.  This is all insane, propagandistic, herding of the masses into the instruments they wish folks to be in, until they deem it time for the sheep to be fleeced. That’s all the “markets” have been for the past 100 years, ever since the Fed was established.  End of story.

Despite all this, I couldn’t be happier about the prospects for stackers in 2015 and beyond,here’s a few reminders why!

India: The New Retirement Home For All Silver Everywhere

There’s no two ways about it, friends, what’s happening right now in India will leave ripples for years to come.  I’ve long said that India is the key which will unlock magical things in the silver space, and gee heinnicky, but India has not disappointed!

Last year, they’d set a new record by importing roughly 6,000 metric tonnes of silver, which was over 190 million ounces.  Impressive to say the least, but what they’ve done this year,especially in the last 3 months, has bested that total by far!

In fact, just when you think India can’t possibly top its silver stacking, they do, every time…

As strong as gold demand has been there(probably about 800 non-smuggled tonnes, year to date),their silver demand continues to break every record, everywhere!  Indians are doing whatever it takes, to continue to buy ever larger tonnage figures of silver, with every blessed rupee note they possess:

Doh, not that kinda rupee note, dagnabbit!  

Ah well, you get the picture!  You know that crazy, old lady, who checks the prices of every. single. item. at a yard sale, and then shops around in every other yard in the neighborhood….in order to save 25 cents?

Ok, great!  Now picture about a billion of those little, old ladies, amplify it with the passion of someone who has a great zeal for sovereign, generational wealth, and voila, you’ve got India! Their peoples continue to be an informed, intelligent flock of buyers, who know a freaking bargain when they see one.

And they continue to see the mother of all bargains in silver!

They are buying so much bleeding silver, that in the past 3 months alone(December not included),they’ve bought over 100 million ounces of it!

http://sgtreport.com/2014/12/why-i-look-forward-to-2015-with-relish/

MARKET DATA PROVES: Overwhelming Public Demand For Silver Eagles…. Not JP Morgan

According to global market data from the top Official Mints, sales of Silver Eagles  originate overwhelmingly from public retail investment demand rather than by one large bank… such as JP Morgan.  I say this in response to the allegation put forth by silver analyst, Ted Butler who believes JP Morgan purchased half of all Silver Eagles since April, 2011.

Ted Butler, who has made this claim over the past several months, does so again in his recent article,The Perfect Crime.  Butler states the following:

For starters, there is the matter of extraordinary sales of Silver Eagles from the US Mint. Since April 2011, the US Mint has produced and sold 140 million Silver Eagles, more than in any similar period of time, in a price environment that can only be termed putrid and in which sales of Gold Eagles were notably lower. I would estimate that JPMorgan purchased close to half of the 140 million Silver Eagles sold since April 2011. According to very reliable sources on the retail front, general investment demand has been lower over this time, as retail buyers do not buy strongly into a declining price environment in any investment asset. Yet we know for a fact that there has been extraordinary buying of Silver Eagles, even while Gold Eagle sales cooled off notably, so someone had to be buying Silver Eagles.

Butler assumes JP Morgan purchased half of the 140 million Silver Eagles produced since April, 2011… and he believes this to be true because “According to very reliable sources, general investment demand has been lower over this time.”

This is where I disagree with Butler.  Now, let me start off by saying it was Ted Butler’s writing back in the early 2000’s that motivated me to start buying silver.  So, I have a lot of respect for Ted as he was one of the leading silver analysts writing about the shiny metal well before it became on the public’s radar.

While I believe there is significant manipulation in the precious metals markets (including most other markets) by member banks, I do not agree with Butler that JP Morgan purchased nearly half of all Silver Eagles since 2011… and I believe I have the market evidence to support my claim.

Top 3 Official Coin Sales Support Broad Based Public Demand

If we look at the top 3 Official Coin sales since 2008, we can see a similar overall trend.  Let’s first take a look at the U.S. Mint sales in the chart below:

As the price of silver skyrocketed, U.S. Mint Silver Eagle sales increased from 19.5 million in 2008 to 39.8 million in 2011.  However, as the price of silver declined and remained flat in 2012, demand for Silver Eagles fell 15% to 33.7 million.  Then in 2013, U.S. Mint sales hit a new record of 42.6 million as investors took advantage of sub $20 silver.

Butler alleges that as JP Morgan drove down the price, it purchased half of all Silver Eagles at a steal.  Well, if this was the case, then who was buying record sales of Silver Philharmonics and Silver Maples??   If we take a look at the next two charts, we can clearly see a similar trend in these two official silver coin sales:

Sales of Silver Canadian Maples and Austrian Philharmonics increased steadily from 2008 to 2011, declined in 2012 and then shot back up in 2013.  So, if JP Morgan allegedly bought half of all Silver Eagles since 2011, who was propping up sales of Silver Maples and Silver Philharmonics?

Furthermore, Canadian Silver Maple Leaf sales in the first three-quarters of 2014 hit a new record of 20.8 million compared to 20.7 million during the same period last year.  However, Silver Eagle sales declined from 36.1 million Q1-Q3 2013 to 32.2 million Q1-Q3 2014.

If JP Morgan was buying half of the 32.2 million Silver Eagles from Jan-Sept of 2014, then who was buying the record 20.8 million Canadian Maples??  While Silver Eagle sales were weaker than Maples in the first nine months of the year, they have picked up significantly in the fourth quarter reaching a new annual record of 44 million.

Now, by combining the sales of the top three Official Silver Coins, we can see how the annual changes in the top three, were quite similar:

All three official coin sales moved in the same fashion…. up from 2008-2011, a decline in 2012 and then up again in 2013.  While 2013 Silver Philharmonic sales did not surpass the record set in 2011, this was probably due to investors choosing Canadian Silver Maples with one of the lowest premiums of all official coins.

As we can see, the market sales data proves that all the top three Official Silver coin sales moved in tandem since 2011.  I believe the public was the overwhelming factor in purchasing Silver Eagles… not JP Morgan.

In addition, India’s silver imports increased from 2009-2011, declined significantly in 2012 and then picked up again in 2013.  Furthermore India’s silver imports, along with record Silver Eagle and Maple sales, will reach an estimated record of 7,500 metric tons in 2014.  Was JP Morgan also buying Indian Silver???

Top Internet Coin Dealers Confirm Higher Silver Eagle Sales

Ted Butler states that he has reliable sources stating that overall retail investment demand is lower, proving that JP Morgan is the large Silver Eagle buyer.  I decided to contact some of the large Online Precious Metal Dealers to see if their Silver Eagle sales have in fact declined since 2011.

I contacted APMEX, JM Bullion, Gainesville Coin and SilverDoctors.  Three got back with me (APMEX failed to return my call in time of publication) and supported the market data that public demand for Silver Eagles increased over the past three years along with the rise of sales at the U.S. Mint.

JM Bullion and SilverDoctors let me know that they deal with some of the Authorized Dealers (who purchase Silver Eagles directly from the U.S. Mint), and they would have mentioned that JP Morgan was buying half of their Silver Eagle allotments since 2011.

JM Bullion, Gainesville Coin and Silver Doctors all agreed that the public has been buying increasing numbers of Silver Eagles, especially on the dips, since 2011.  While demand for standard silver bullion may not be as robust as it was in 2011, it seems as if investors are purchasing more LEGAL TENDER SILVER COINS, especially Silver Eagles and Silver Maples.

If JP Morgan was buying half of all Silver Eagles since 2011, as Butler suggests, then we would have seen a decline in sales of Silver Philharmonics and Silver Maples.  Not only have sales of Silver Maples hit new record of 20.8 million Q1-Q3 2014, they will likely be quite strong in last three months of 2014… even with rationing due to the huge take-down in the price of silver on Halloween and into the first week of November.

I wanted to provide a rebuttal to Butler’s allegation that JP Morgan was the large buyer of Silver Eagles because his opinion takes CREDIT AWAY FROM THE PUBLIC, and puts it in the hands of the BANKERS.  While Ted Butler provides excellent information on the silver market, I believe his opinion on this matter is incorrect.

One last thing… Butler states the “putrid sales of Gold Eagles compared to Silver Eagles” as another factor proving that JP Morgan was the big silver buyer.  While it’s true that Gold Eagle sales have declined significantly since 2011, so have Gold Maple Leaf sales.  Matter-a-fact, Gold Maple Leaf sales are down 46% in the first nine months of 2014 compared to the same period last year… even though sales of Silver Maples continue into record territory.

As these three Official Coin Retail Dealers agreed, its the public taking advantage of lower silver prices by adding metal to their investment holdings.  This also includes WEALTHY PRIVATE BUYERS who purchase silver in large lots.

We must remember, the buying of Official Silver Coins is from a very small motivated percentage of the public.  Can you imagine what will happen when 98% of the public realizes they have invested in FINANCIAL PAPER ASSETS that have no future?

http://srsroccoreport.com/market-data-proves-overwhelming-public-demand-for-silver-eagles-not-jp-morgan/market-data-proves-overwhelming-public-demand-for-silver-eagles-not-jp-morgan/

Diversify With “Physical Precious Metals Stored Outside The U.S.” – Faber

Dr Marc Faber, respected economic historian and author of the respected monthly newsletter, the ‘Gloom, Boom and Doom Report’, has warned that 2015 is set to be very volatile, urged international diversification and owning “physical precious metals stored outside the U.S.”

In another insightful and witty interview with Bloomberg Television’s In the Loop, with Betty Liu, Erik Schatzker and Brendan Greeley, the ever charming and affable Dr. Marc Faber reaffirmed his long-standing preference for investing in emerging eastern economies, his lack of faith in the dollar and advised Americans to own gold.

Faber fails to recommend a single U.S. stock in 2015 and when asked whether recent events in Greece were a buy or sell signal, Faber began by pointing out that persistent intervention by central banks into markets had made making predictions far more complicated.

Some commodities have soared in the last six months, wheat has doubled, while the price of oil and natural gas had collapsed indicating great volatility. Forecasters surveyed by Bloomberg had been consistently bearish on bonds for years, until this year since treasuries outperformed the S&P in 2014.

Hedge funds generally only generated returns of around 1%. In light of these discrepancies and central-bank induced distortions to the market, Faber emphasises the need for real diversification.

When asked whether he had maintained his “discipline” when oil prices crashed he surprised his interviewers by saying that he actually trades very little to avoid commissions and charges and he indicated that he was so broadly diversified that the oil crash had little impact on his portfolio.

He went on to warn regarding U.S. stocks. “Sentiment about stocks in the U.S. is much too bullish, much too optimistic” and suggested that U.S. ten-year treasury notes yielding 2.2% were the best of a bad lot given the abysmal returns being offered on the bonds of other developed economies.

Dr. Faber was then challenged on his forecasts from 2008 where he referred to the dollar as toilet paper and denounced quantitative easing.

“Now if we stuck with that view”, the interviewer asked, “where would we be today with the S&P 500 trading north of 2000 and ten year yields, as you pointed out at 220?”

Faber responded with a laugh “Yes, the toilet paper status is still ahead of us……for all paper currencies – not just the U.S. dollar.”

He then pointed out how he had advised owning Asian stocks in 2014 and in recent years and how the stock markets of emerging economies have substantially outperformed U.S. stocks in 2014. He cites China’s stock exchange up 45%, India up 25%, Thailand up 14%, Indonesia 18%, Philippines 21% and Pakistan up 40%.

He also draws attention to the fact that just being invested in U.S. stocks was not enough to guarantee decent returns:

“As of early December there was about as many stocks on the New York stock exchange that were down 10% as up 10% and as many stocks down 40% as there were up 40% so we have a huge diverging performance.”

When asked directly which U.S. equities he would own, “what specific companies would you own in the U.S.?” – he declined to give a single recommendation. Instead he signalled that Americans should be getting their wealth out of the U.S. and into gold stored abroad.

He sagely and pointedly added:

“I have to say that sentiment about precious metals is incredibly negative and all these “experts” are predicting the gold price to drop to $700. Well, understand, these are experts that never owned a single ounce of gold in their lives!”

“So they missed the five fold increase since 1999!”

“But they all know that the price of gold will go to $800, they write about it with a lot of authority.”

Dr. Faber is a long time proponent of owning physical gold. He has consistently urged people to act as their own central bank in acquiring bullion coins and bars as financial security and he believes that to store gold in Singapore is the safest way to own gold today.

http://www.zerohedge.com/news/2014-12-31/diversify-%E2%80%9Cphysical-precious-metals-stored-outside-us%E2%80%9D-%E2%80%93-faber

1 ounce $50 American Eagle Gold Coin Bullion 2002 Uncirculated

“Brilliant uncirculated American Eagle 1 ounce fine gold coin from the original US Mint Roll.”

http://www.ebay.com/itm/1-ounce-50-American-Eagle-Gold-Coin-Bullion-2002-Uncirculated-/301465146933?pt=US_Bullion_Coins&hash=item4630b91635

The American People Are Utterly Clueless About What Is Going To Happen As We Enter 2015

Submitted by Michael Snyder via The Economic Collapse blog,

The American people are feeling really good right about now.  For example, Gallup’s economic confidence index has hit the highest level that we have seen since the last recession.  In addition, nearly half of all Americans believe that 2015 will be a better year than 2014 was, and only about 10 percent believe that it will be a worse year.  And a lot of people are generally feeling quite good about the people that have been leading our nation.  According to Gallup, once again this year Hillary Clinton is the most admired woman in America and Barack Obama is the most admired man in America.  I don’t know what that says about our nation, but it can’t be good.  Unfortunately, when things seem to be going well common sense tends to go out the window.  A couple days ago, the Guardian ran an article entitled “Goodbye to one of the best years in history“, and a whole lot of people out there are feeling really optimistic these days.  But should they be?

Sadly, what we are experiencing right now is so similar to what we witnessed in 2007 and early 2008.  The stock market had been on a great run, people were flipping houses like crazy and most people were convinced that the party would never end.

But then it did end – very painfully.

The signs of trouble were there, but most people chose to ignore them.

Sadly, the exact same thing is happening again.

On Monday, the price of oil hit a brand new five year low.  As I write this, U.S. oil is sitting at a price of $53.76 a barrel, which is nearly a 50 percent decline from the peak earlier this year.

There is only one other time in history when the price of oil has declined by more than 50 dollars a barrel in such a short time frame.  That was back in the middle of 2008, shortly before the worst stock market crash since the Great Depression.

Unless the price of oil starts really bouncing back, the U.S. economy is going to be hit really hard.

Since 2009, oil industry employment has risen by 50 percent.  And jobs in the oil industry pay quite well.  One figure that I saw put the average weekly wage at about 1700 dollars.

But now we aren’t going to be gaining those types of jobs.  Instead, we are going to rapidly start losing them.

Already, the oil rig count has dropped for three weeks in a row and is now at an 8 month low.  And as the oil industry suffers, all of the industries that it supports are also going to start feeling the pain.  In fact, Business Insider is reporting that Texas business executives are “freaked out” about what is happening…

Business executives in Texas are worried about the drop in oil prices.

On Monday, the Dallas Fed’s latest manufacturing survey showed that activity in Texas was slowing down.

The latest composite index came in at 4.1, widely missing expectations and down big from November’s reading. Expectations were for the index to come in at 9, down from 10.5 last month.

So while most Americans are feeling really good about the coming year, many of those with an inside view are becoming quite alarmed.  One Texas business executive went so far as to say that the stunning decline in oil prices was “going to make things ugly … quickly.“

Meanwhile, the 9 trillion dollar U.S. dollar carry trade is starting to unwind.

The following is an excerpt from a recent Zero Hedge article…

Oil’s collapse is predicated by one major event: the explosion of the US Dollar carry trade. Worldwide, there is over $9 TRILLION in borrowed US Dollars that has been ploughed into risk assets.

Energy projects, particularly Oil Shale in the US, are one of the prime spots for this. But it is not the only one. Economies that are closely aligned with commodities (all of which are priced in US Dollars) are getting demolished too.

Just about everything will be hit as well. Most of the “recovery” of the last five years has been fueled by cheap borrowed Dollars. Now that the US Dollar has broken out of a multi-year range, you’re going to see more and more “risk assets” (read: projects or investments fueled by borrowed Dollars) blow up. Oil is just the beginning, not a  standalone story.

If things really pick up steam, there’s over $9 TRILLION worth of potential explosions waiting in the wings. Imagine if the entire economies of both Germany and Japan exploded and you’ve got a decent idea of the size of the potential impact on the financial system.

And that’s assuming NO increased leverage from derivative usage.

Ouch.

And yes, as that last excerpt mentioned, derivatives could soon become a massive problem.  The big banks are holding trillions in commodity derivatives that could blow up if the price of oil does not rebound.  Overall, there are five U.S. banks that each have more than 40 trillion dollars of exposure to derivatives of all types, and the total global derivatives bubble is at least 700 trillion dollars at this point.

At the same time, many are becoming concerned that the unprecedented bond bubble that we are witnessing could soon implode and trillions of dollars of “wealth” could disappear into thin air.

In fact, Bloomberg says that we should “get ready for a disastrous year” for bonds…

Get ready for a disastrous year for U.S. government bonds. That’s the message forecasters on Wall Street are sending.

With Federal Reserve Chair Janet Yellen poised to raise interest rates in 2015 for the first time in almost a decade, prognosticators are convinced Treasury yields have nowhere to go except up. Their calls for higher yields next year are the most aggressive since 2009, when U.S. debt securities suffered record losses, according to data compiled by Bloomberg.

That certainly does not sound very optimistic, does it?

Anyone with even a minimal amount of intelligence should be able to see the massive financial bubbles that the central banks of the world have created, and anyone with even a minimal amount of intelligence should be able to see that we are heading for a massive financial implosion which will be extraordinarily painful.

Unfortunately, as I wrote about yesterday, the American people have become “zombiefied“.  Instead of thinking for themselves, they let “the matrix” do their thinking for them.  And right now “the matrix” is telling them that everything is going to be just fine in 2015.

If you do not think that there is a propaganda machine that tells us what to think, I want you to watch the video posted below very carefully.  This video makes it so obvious that even a small child can understand it…

http://www.zerohedge.com/news/2014-12-30/american-people-are-utterly-clueless-about-what-going-happen-we-enter-2015

"Peak Gold Production" Hits In 2015

Several days ago we reported that as a result of persistently lower gold prices, driven down by a seemingly endless supply of paper gold (in the form of ETF selling and Bank of International Settlement "price discovery") offsetting a seemingly unbridled appetite for physical gold, not only is one of the biggest marginal suppliers of gold - Chinese producers - about to take an extended hiatus, but first one and then many "developed" gold miners are about to throw in the towel.

As UBS' Shanghai analyst Lin Haoxiang said, "Falling prices are cutting into some high-cost private mines in China, while some big miners chose to reduce costs by reducing jobs and capital investments." As for the North American gold miner defaults, they have already started with Canada's San Gold warning its creditors it is about to stuff them with a lot of unrepayable paper.

However the unwind plays out, it is becoming increasingly clear that just as the crude oil market is set for some violent times ahead as producers lock into the defection phase of the Prisoner's Dilemma and flood the market with supply in an attempt to crush the weakest competition, so the gold market is set for many upheavals, the first of which, however, may be what Goldcorp defined in a recent slideshow as Peak Gold.

The only difference is that Goldcorp does not look at it from the perspective of Game Theory, where it is every miner (and their balance sheet) for themselves, but as a function of a 20 year lead-in development time following the period of peak gold discovery which took place in 1995. End result: "Gold market forecasters are expecting peak production in ~2015."

And then there are of course, the practical implications of gold miners who are living if not on borrowed time, then close to it. As the following chart of the gold industry's "all-in sustaining costs", when one takes net debt and the interest due on it into consideration, it becomes clear why gold has managed to find the $1050-$1200 region as support: drop the price of gold below that and suddenly 90% of the entire gold industry becomes unprofitable.

None of which means that gold can't - or want - drop below any given price, or slide into the triple digits. As we showed earlier, the new normal "markets" are so rigged - with the blessing of central banks no less - that attempting any rational predictions, especially when it comes to the one susbtance most hated by central bankers through the ages, is painfully meaningless.

And we are confident that before all is said and done, gold will surely plunge to even further manipulated lows because in the current market, where one can create paper gold futures contracts out of thin air, there is nothing to prevent just that. Which is why the following table showing gold miner net leverage will be quite useful in the years to come as the race to the prisoners' dilemma "defection" bottom - one in which only those with the best balance sheets survive - enters the final stages.

In any event when all is said and done, gold production will be far lower in a few years than where it is now. The only question is how will central bankers orchestrate a parallel decline for physical gold, because even with all the paper manipulation in the world, the supply and demand curves for the underlying commodity can be ignored only for so long.

http://www.zerohedge.com/news/2014-12-30/peak-gold-production-hits-2015

Gold's Mega-Move Days Have Turned Bullish

Monday December 29, 2014 12:43

In bidding adieu (or if you prefer, a not-so-Golden good riddance) to 2014, 'tis said that those who've "manipulated" the price of Gold lower shall be the same entities which shall "manipulate" it back up. To the extent that the price of Gold is or is not "manipulated", (as long as we can engage fairly and equitably in a like trading platform and have enough size ourselves to shove price about manually and/or algorithmically), we've got some very heartening news to share in closing out what has not so much been a down year for the yellow metal, (as 'tis on target to finish just either side of the 1205 "break-even "level), but instead a year that has been perpetually annoying. With only three trading days remaining in 2014, 'tis at this juncture incidental as to whether Gold nets out an up or down year: for far more material either way is the above scoreboard's telling us just how alarmingly low price is relative to the growth in our money supply these last 30 years.

However, here's the heartening bit: be they "manipulators" and/or legitimate trading forces sufficiently capitalized to hoover away hundreds of bids or offers in an electronic heartbeat, we've ferreted out data which is indicative of them having changed their tune from selling/shorting Gold to now buying it, or if you'd prefer, that the upside "manipulative" rumblings are at last underway. To the naked eye, such activity is sufficiently stealth so as not to notice it: but to a measurable degree, we've sussed it out, or at the very least, found evidence of Gold's price now being protectively supported. And as odd, indeed sparse or incomplete as the following chart may at first glance appear, 'tis showing us the market moving powers that be are shifting back into buy mode:

"Uh, mmb, like Ricky said, Lucy you got some 'splainin' to do..."

Absolutely, Squire. What you're looking at above are Gold's intra-day price movements for the 250 trading days now in the books for 2014: except visibly there are only six bars across the entirety of the chart. Why? Because we've eliminated every day which traced a trading range of less than 40 points between its session's high and low so as to only cite Gold's "mega-move" days. And more importantly, here's the best part: the colour of those six robust bars describes the directional thrust of those mega-moves: Red for down-thrust, and Gold for up-thrust.

To be sure, 'twould be beyond the extremes of arrogance to believe that which we pen influences market direction; we likely more oft are considered a contrary indicator. But with respect to the above chart and its cluster of three up mega-moves just in these last two months, they curiously occurred with our introducing The Gold Update Scoreboard which now opens these weekly missives. Coincidence?

"Absolutely, mmb."

Squire's brutal honesty notwithstanding, let us press on to the graphic of Gold's weekly bars, wherein we see the parabolic trend having survived its fourth week to the LongSide, as indicated by the ascending blue dots. The descending dashed trendline across the chart belies just how near Gold is to actually closing out 2014 as a "break-even" year, 2013 settling at 1204.8 and now yesterday (Friday) at 1196.1, again with but three remaining trading days in the balance. Further note that despite the absence of a rare "mega-day" this past week, price still scampered up to close near its bar's high:

Of course, Sister Silver, below in her own weekly bars chart, shan't be closing out 2014 anywhere near her 2013 settling price of 19.425, for in finishing the week yesterday at 16.085, the descending dashed trendline truly tells her tale of woe:

Don't take it too hard, Sis. You may be -17% year-to-date, but so identically is Cousin Copper, whilst your distant Uncle Oil is -44%! (Next week's missive in opening 2015 will present the final "BEGOS Markets Standings" for 2014).

Then there's the stock market, which in conveniently ignoring global asset price shrinkage, continues to bound merrily along, the S&P 500 setting all-time highs on a daily basis as 'tis complacently assumed 'twill do in perpetuity. We however, as you well know by now per our being seemingly forever on "crash-watch", see it quite differently. As our calculation of the S&P's price/earnings ratio closes in on 30x, (the current "live" reading being 29.4x), please excuse our implementation of even more common sense in pointing out that the S&P's MoneyFlow is hardly keeping pace with price's perennial rise. Here is their relationship regressed to an S&P-points basis over the past 63 trading days (one quarter) to date, indicative of price ascending sans volume, quite in contrary to the past week's in-depth ChiTrib piece entitled "Dow, S&P power to new records". Quite frankly, and rightly in tune with this 1977 hit by Jackson Browne, we see the S&P as "Running On Empty...":

And therefore from the stock market's standpoint as having participated in this December to Rememberwe're fully anticipating that 'twill be a capitulative January to Forget. And as goes January... Besides, let's face it: when you've the S&P trading at double the support of its earnings base, and the price of Gold valued at half its natural level given Dollar debasement alone, something soon will give, and I suspect for the markets 'twill be massive.

As for the chest-pounding "Dollar strength" crowd out there -- and yes the beloved Greenback's Index now for the first time since April 2006 is just above 90 (90.315) -- the Buck is currently up 3% from Gold's closing low day of the year (1140 on 05 November), whilst the yellow metal itself is nevertheless up 5% from same:

Still, StateSide we've the percentage of adults in their prime working years with full-time jobs near the lowest levels ever recorded, (per the Bureau of Labor Statistics as far back as 1986). In the Middle East, veteran Saudi Arabian Oil minister Ali "fake it on the give-and-go" al-Naimi stated that Oil's price is irrelevant to output decisions, the Saudi Finance Ministry then pledging to curb wages and sally forth with investments next year toward lessening the blow of the halved price of petroleum. Meanwhile over in Japan, for the first time with records having been collected since 1955, their savings rate has turned negative as the populous draw on their nest-eggs, despite inflation just having slipped to a 14-month low. Westward across the sea from there, China's industrial profits for November just fell by the largest amount in two years. And not to be outdone by such economically foundationless follies, Greece’s Parliament still has yet to elect a new President, which were the anti-austerity opposition to instead become empowered, could again bury Hellenic paper. All-in-all, a fairly good year-ending basket of Gold positives, non?

Which in turn gives us hope that 2015 shall be far better for Gold than this Year of Annoyance. With just the three trading days left, we close out 2014 with this final two-panel technical graphic. On the left we've Gold's daily bars for the past three months with the ever-attendant "Baby Blues" depicting 21-day linear regression trend consistency, which admittedly is waning, (and for those of you who read the daily Prescient Commentary, you've likely noted an open signal for Gold to trade down to 1164.1 per its daily Price Oscillator study having gone negative). On the right is Gold's 10-day Market Profile showing price just a point below trading resistance at 1197, with underlying, less participative support at 1178.

This ensuing holiday-shortened, boundless football bowls week is not without some key incoming economic data, including December's Chicago PMI reading on New Year's Eve and then in turn on Friday, the first trading day of 2015, the ISM Index. In the interim, please be safe out there: we want all of our great and valued readers riding along with us in the Great Gold Machine of 2015!

A Happy and Golden New Year to Us All!

Cheers!

http://www.kitco.com/ind/Baillie/2014-12-29-Gold-s-Mega-Move-Days-Have-Turned-Bullish.html

Russia Is Creating A 'Noah's Ark' With The DNA Of Every Creature That Ever Lived On Earth

A ship modeled after the biblical description of Noah's Ark, "Johan's Ark," in the Netherlands.

Moscow State University just received Russia's largest-ever scientific grant in a bid to create a veritable "Noah's Ark" containing the DNA of every living and extinct creature on the planet.

The concept is similar to the Svalbard Global Seed Vault in Norway, but Russia's DNA ark would become the world's first database of its kind.

The project is set to be completed by 2018 and, according to reports, it will be 430 square kilometers in size — over 40 times the size of the Svalbard seed vault.

The idea is all the more relevant and pertinent considering how close to extinction several major species are. The Western black rhino has been declared officially extinct, and the Northern white rhino exists in such low numbers that a sustainable population is no longer possible.

In a press release, MSU rector Viktor Sadivnichy said: "I call the project 'Noah’s Ark.' It will involve the creation of a depository — a databank for the storing of every living thing on earth, including not only living, but disappearing and extinct organisms. This is the challenge we have set for ourselves.

"It will enable us to cryogenically freeze and store various cellular materials, which can then reproduce. It will also contain information systems. Not everything needs to be kept in a petri dish."

Samples for this massive database will be gathered from numerous sources including the Botanical Garden, the Anthropological Museum, the Zoological Museum, and others. All of the university's departments will be involved in the research and collation of materials, which will commence straight away thanks to the record-breaking grant of over 1 billion rubles (US$194 million). "If it's realized, this will be a leap in Russian history as the first nation to create an actual Noah's Ark of sorts," the rector said.

Read more: http://inhabitat.com/russia-to-create-noahs-ark-with-the-dna-of-every-animal-on-the-planet/#ixzz3NOiQpU00

Gold Held In NY Fed Vault Drops To Lowest In 21st Century After Biggest Monthly Withdrawal Since 2001

Exactly one month ago we observed that, as expected in the aftermath of the Netherlands' shocking and still not fully-explained gold repatriation from the NY Fed, the amount of foreign earmarked gold on deposit with the Fed had just experienced a 42 ton withdrawal: the single largest outflow of gold held at the NY Fed in over a decade, going back all the way to 2001. This had brought the total amount of YTD gold withdrawals from the NY Fed to a whopping 119 tons: the most since the Lehman collapse.

However, because this total was insufficient to cover just the Dutch repatriation of gold from the NY Fed (which amounted to 122 tons), we knew there would be more activity when the November data hit. Sure enough, earlier today the Fed reported the total amount of earmarked gold (or gold "held in foreign and international accounts and valued at $42.22 per fine troy ounce; not included in the gold stock of the United States") for the month of November: at $8.184 billion, this was a $60 million drop from the previous month (or it would be at the $42.22/ounce "price"; at market prices the value of the withdrawn gold is about $1.7 billion).

In actual tonnage terms, this means that in November some 47.1 tons of gold were withdrawn from the NY Fed, bringing the Fed's total earmarked gold to just 6,029 tonnes: the biggest single monthly outflow going back to the turn of the century. This is also the lowest amount of gold held at the NY Fed vault located at 33 Liberty street (and just across from the even bigger vault located at 1 Chase Manhattan Plaza) in the 21st century.

But even more notable is that with the November data, we now know that all of the Dutch repatriated gold is fully accounted for.

Which brings up a far more important question: net of the Netherlands withdrawals, there is some 44 tons of extra gold that has been also quietly redeemed (by another entity). The question is who: is it now the turn of Austria to reveal in a few weeks that it too, secretly, withdrew some 40+ tons of gold from "safe keeping" in the US? Or was it Belgium? Or did the Dutch simply decide to haul back some more. Or did Germany finally get over its "logistical complications" which prevented it from transporting more than just a laughable 5 tons in 2013? And most importantly, did Germany finally grow a pair and decide not to let "diplomatic difficulties" stand between it and its gold?

We should have the official answer shortly, but we know one thing: it sure wasn't Ukraine. 

http://www.zerohedge.com/news/2014-12-29/gold-held-ny-fed-vault-drops-lowest-21st-century-after-biggest-monthly-withdrawal-20