Passcode: Israel

Never waste a crisis.

By the way, I learned yesterday that my site is now banned in mainland China with a few exceptions. I saw a short list of blogs that were banned, and those that were not, and it was telling an interesting story. As Bill Gates said, the PRC are his kind of capitalists.

MEDIA ADVISORY
COUNCIL ON FOREIGN RELATIONS
-----------------------------------------------------

Benjamin Netanyahu's Meeting with President Obama

President Barack Obama and Israeli Prime Minister Benjamin Netanyahu will meet in Washington on July 6 to discuss the Gaza blockade and the U.S.-Israeli relationship. CFR's new fellow Robert Danin will discuss the implications of the prime minister's visit in a media conference call.

Date: Thursday, July 1, 2010
Call Time: 3:00 p.m. - 4:00 p.m. ET

Dial-in Information:
U.S. callers: 1.800.351.6805
International callers: 1.334.323.7224
Passcode: ISRAEL

The on-the-record discussions are not so nearly as interesting as the long term private discussions that take place, often in picturesque places, that feature great skiing, good food, and fine wines. Trust me on this one.

Gold: Chart Updates - Gold is a Counter Trade to Currency Risk

Although the gold bulls took a severe 'gut check' today, the cup and handle formation ultimately proved too powerful for the bears and bullion banks to break. It is an epic struggle, with much broader, perhaps even historic, implications than most of us can now realize, being too close to the event to see its true dimensions.



The weekly chart shows that gold is in a bull market. Anyone who does not acknowledge this, especially any metals analysts, are talking their books and private agendas. I can think of no other profession that allows for such blatant deceptions as the US financial sector.

The hysteria that accompanies every minor, albeit somewhat sharp, pullback in the price of gold borders on the ridiculous. It is often a 'psych job' by hedge funds, and unfortunately a mass of the deluded who simply do not understand currency markets and money. They think they do, but they don't, and in this case a little knowledge is a dangerous thing for their accounts.

Gold is a counter trade to currency risks. Monetary inflation is only one example of that risk. So the simplistic model is bewildered when gold rockets in the face of deflation caused by credit destruction and weak aggregate demand. What it fails to account for is the dramatic deterioration in the backing for the currency due to the corrosive decay of its underlying assets, the degraded ability to tax and service debt, and the actual assets held by the central bank.

And this is why at times some governments seek to control rival currencies such as gold. It is the economic equivalent of rolling back the odometer, or putting sawdust in the crankcase of a car which you wish to sell to the unsuspecting. It is a means to a control fraud, the deliberate hiding of the dilution of your currency to support a set of political and personal objectives. And this is why the citizenry, if they are wise, will insist on transparency in the metals markets and the asset holdings of their country.



The miners are doing reasonably well all things considered, but may not stand up well IF there is a sell off in the general equity markets.



You may as well hear it all now, because in the event of war, the truth will be the first victim.

US Equity Markets At a Key Juncture Ahead of Jobs Report and Holiday Weekend

SP 500 September Futures Daily Chart

At least a dead cat bounce after a drop such as this to key support. But heading into a holiday weekend with an important non-Farm Payrolls Report and wavering confidence, anything can happen after that.



The SP 500 Cash Weekly Chart give a better perspective on how important a test of support the market is facing.



VIX is approaching levels where one would either expect the market to stabilize and begin to recover its footing, or quickly break down and fall apart.



The Nasdaq Composite is in the same situation, so it is clearly a macroeconomic statement, and not something particular to one index.