Gold Daily and Silver Weekly Charts - Canada Takes Cyprus Model - Bolivar Failing - Global Pigfest

There was a very obvious hit on the precious metals market today. You could not miss it if you were watching the tape intraday.

I have posted some commentary on that here and here.

The Non-Farm Payrolls Report is on Friday. The ADP report came in light today, and ISM Services missed as well.

There were a couple of surprises today in that things which we have seen are now starting to penetrate the mainstream consciousness.

Jim Chanos observed that the moral hazard is now so bad that 'cheating is a fiduciary responsibility.' Nice tone that the governments are setting in Washington and London.

Even nations are getting in on the action as Venezuela is allowing the financiers to front run its devaluations.

"Unlike the first devaluation however, the second was done behind closed doors with local financial interests placing bids on dollar exchange transactions ahead of the country’s citizenry...

The chart shows that when measured against gold, the Venezuelan Bolivar has “collapsed” from Bs. 860 in 2005, to what appears to be over Bs. 20,000 today. This represents an over 23-fold move (2300%) in gold over the last eight years.

Additionally, the CBC seems to have confirmed that Canada is concerned about bank failures and is adopting the Cyprus model for their own bailout plans.

It seems a bit dodgy that both NZ and Canada have taken these steps, while reassuring everyone, rather smugly, that their banks cannot fail.

Are you kidding me?  In the event of a major global derivatives event, I would imagine that nothing in the banking system is safe.

And lastly, I hear from Bloomberg that American Banks with European money market funds intend to deal with their negative returns by quietly 'breaking the buck.'  Bail-in, everybody.

If the above does not give you a sense of foreboding then you may wish to check your pulse.

And with the gold and silver action we are seeing, and the dissembling about the safety of the banking systems and the economy,  it is as if the local authorities are trying to keep people on the beach, generating commercial activity by spending money and saving paper currency, while they themselves make their own provisions for an incoming tsunami of financial disaster.

Right. I'll send you a postcard from higher ground, eh?

Have a pleasant evening.

SP 500 and NDX Futures Daily Charts - Whoops

The economic news this morning was a bit thin as the ISM Services missed estimates a bit, while the ADP employment report missed consensus by quite a bit more.

In my own way of thinking, the stock markets took a big retrenchment after hitting the SP 500 chart's intermediate chart objective yesterday of 1565-1570.

All eyes should be on the Non Farm Payrolls report on Friday, as well as the growing crisis in the global banking sector. You may not be aware of it, but the smart money certainly is.

The financial system is inherently unstable now, and I would take defensive measures as one might be able.  When the time comes, there will not be time.

The VIX rose but is still relatively benign.  I will be a bit surprised if the market does not take at least one more run at a new high, but I am a bit discouraged of that unless the June futures can regain the big support area north of 1550.

I did shed some of the volatility which I purchased yesterday during the market's sojourn in the land of the lotus eaters.  I am in a more defensive posture here including bullion bought on weakness.

CBC: Canada To Adopt the Cyprus Model of Depositor 'Bail-In' In Case of Bank Failure

The smugness of the Canadian politicians is reminiscent of the Bank of New Zealand. 

Perhaps that is what the political do when they are making plans for a gathering storm and they wish for everyone to remain on the beach in the meanwhile.

I could be wrong, but in my judgement nothing in the global banking system is safe if the massive derivative bubble collapses. 

It will not only take down the private banks, but quite a few sovereign countries as well.

I am of the opinion that in the States there will not be the same sort of 'bail in' but a 'print in' in which the Fed will supply as much money as is required, taking value from all who hold Dollars including foreign holders.  So in that sense, the US is 'safe.'  It is all the holders of dollars around the world who are not.

You may wish to take some protective measures if you have not done so already.   When the times comes, there will be no time.

Ottawa weighing plans for bank failures
By Neil MacDonald
April 3, 2013

Buried deep in last month's federal budget is an ambiguously worded section that has roiled parts of the financial world but has so far been largely ignored by the mainstream media.

It boils down to this: Ottawa is contemplating the possibility of a Canadian bank failure — and the same sort of pitiless prescription that was just imposed in Cyprus.

Meaning no bailout by taxpayers, but rather a "bail-in" that would force the bank's creditors to absorb the staggering losses that such an event would inevitably entail.

If that sounds sobering, it should. While officials in Ottawa are playing down the possibility of a raid on the bank accounts of ordinary Canadians, they chose not to include that guarantee in the budget language.

Canadians tend to believe their banks are safer and more backstopped than elsewhere in the world. The federal government enthusiastically promotes the notion, and loves to take credit for it.

It may well be true, even if Canada's six-bank oligopoly isn't terribly competitive, at least in comparison to the far more diverse American banking universe.

But in the ever-more insecure world that has unfolded since the financial meltdown of 2008, it is also increasingly clear that nothing is safe anymore, not even blue-chip bank stocks and bonds or even, in the case of the Cyprus bail-in, private bank accounts.

And now, Canada is making a bail-in official government policy, too...

Read the rest here.

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds - Part Deux

Blatant as can be.

In general, it is 'open season' on small investors in the markets, so why should gold and silver be otherwise?

The only thing that the precious metals are correlated to here is manipulation.

Canada Weighs Cyprus Solution For Bank Failures - CBC

Non-Farm Payrolls on Friday.