NAV Premiums of Certain Precious Metal Trust and Funds

The Gold Silver ratio is over 70.

Today was a Non-Farm Payrolls Report, which came in 'better than expected' in providing low paying jobs.

Wage growth missed and was "0".  The Labor Participation Rate is at a 36 year low.

Premiums on Sprott are close to historic levels, and the Spicer Central funds remain more discounted.

The Anglo-Americans Bankers are really 'dishing it out' as China is on holiday for 'National Week.'

Gold Daily and Silver Weekly Charts - The Ritual of Our Existence

"The ritual of our existence is based on the strong getting stronger by devouring the weak. We must face up to this.

No more than right that it should be this way. We must learn to accept it as a law of the natural world."

Ken Kesey, One Flew Over the Cuckoo's Nest

There was intraday commentary about the Gold/Silver ratio which is at an extreme.  You may read about it and what it may mean here.

Gold and silver hit weakness in the late London and early New York trading periods, which is pretty much de rigueur these days.  And tomorrow is a Non-Farm Payrolls Day.

I am taking a closer look at the silver market.   As you know I saw some interesting divergences between gold and silver with regard to ETF inventory level changes earlier this year.   There are others and I am looking at them more closely.

It is getting so bad, one cannot even continue to make allowances for gross incompetence and hubris on the part of The Fed.   Today Bill Dudley had his James Clapper moment, and roundly denied any lack of regulatory zeal at the New York Fed.  It was insensitive, arrogant, and pretty disgusting.

“I don’t think anyone should question our motives and what we are trying to accomplish.”

The Fed is to regulation what David Cameron's Tories are to the English people.

That is, they may sometimes sound eloquent and publicly appear to be broad minded, informed, and responsible.   But deep down you know that they are worse than useless, being self-absorbed, atavistic, conspicuously indifferent to the public, myth driveling toffs and gits.   At least the Tories have the stuff to put up a proper nob like Osborne as their man.   The Fed's overlords have to hide behind bubbe.

Andrew Jackson was right.

Have a pleasant evening.

SP 500 and NDX Futures Daily Charts - Internet Stinkers, Non-Farm Payrolls Tomorrow

The US economic data this morning was pretty much lackluster.

Tomorrow is the big Non-Farm Payrolls report. I'll save any speculation about it until we see the numbers.

Stocks were off in part in sympathy with markets in Europe.

A couple of internet IPOs on the Frankfurt exchange, Rocket Internet and Zalando, came out this week and then flopped in the after trade over ten percent. No one does lipstick better than the NYSE, I'll give them that.  People are wondering if the internet miracle story is getting a bit thin.

Speaking of getting a bit thin,  President Obama was giving a pep talk at an outpost among the indigenous peoples of the US at Northwestern University today. He presented a laundry list of his accomplishments, and went on to say:

"I am not on the ballot this fall. Michelle’s pretty happy about that. But make no mistake: these policies are on the ballot. Every single one of them."

I am sure the Republican Party was doing cartwheels over that one. The economy is widely perceived as failing the great bulk of the American people, serving corporations and the wealthiest few, and rightly so. 

By underscoring the role that his policies have had by commission and omission, and making the midterm elections a referendum on his policies, Obama did more good for the political opposition than even his tone deaf, aloof self probably realizes.

Yes the President has done some good, but his legacy is murky on the economic side of things, if not hopelessly compromised.  Someone needs to get him away from his adoring fans and yes-men, and open his eyes to what he is actually doing.

A leader leads. And a good leader addresses the current anxieties and concerns of the people. Obama has failed miserably at this. But at least he might scrape out a great post-election influx of wealth, Clinton style, which seems to be the major issue for most politicians of both parties these days.

Have a pleasant evening.

Gold Silver Ratio and Some Thoughts On Markets

Fear Us!

As you may recall, silver is more volatile than gold.

That means if the two metals are moving in the same general directional trend, as they are often wont to do, then silver will be moving faster and further in that direction than gold.   Silver has a higher beta.

So when one considers the gold/silver ratio, one is perceiving the 'spread' between the two.  In general, at the extremes, the spread between gold and silver will widen and narrow markedly as compared to itself over time.

We are at such an extreme now. Sometimes these merely signal short term tops and bottoms. And sometimes they signal trend changes.

In addition to the volatility differences, there are a few others.

Silver has a greater industrial usage than gold. So it corresponds more to the general trend in base metals.    Further, gold is perceived as more of a 'safe haven' than silver.  Gold is more purely 'money' than silver.  Silver is also more often a byproduct of base metal extraction.

All other things being equal, gold will be a more reliable store of value in times of crisis, but silver, once the crisis is past, will begin to overtake gold and recover more quickly.   Holding silver with leverage, given its already volatile nature, can be a real sleigh ride.  I don't use it for investment purposes, merely for a quick flip, lightly and only on occasion.

So there are a number of variables to consider in this ratio. In the past I used to engage in fairly elaborate multivariate regression analysis of these things.  I am doing less of this technical price analysis now that the markets have become as they are.  Analysis without including Asian supply and demand fundamentals has become somewhat effete.

As I have remarked colloquially the other day, there is some 'weird shit' going on in the silver market.  I will probably have more to say about this in the days to come.  I am sifting through rumours and data.  I may pass a few along, just because they are so delightful, in the manner of a novel. 

And I cannot say enough what a poor measure of the demand and value of metals is to be found on the Comex. If you really consider now what it is doing and how it is doing it in the quest for 'price discovery,' it is about as relevant to the value of the precious metals as a private game of Liar's Poker is to the value of the US dollar.  

But while people believe, it does have power.  It is an unfortunate country whose prices are set in a poorly regulated casino. 

I firmly believe that the US markets have given way to a shockingly pervasive control fraud once again, which can be called The Big Skim.  And there will be consequences over time.

These schemes always seem to fail.  In their late stages their is more use of fear than fraud, until they become almost all stick and no carrot, and then they fail.   And their failure has few fathers, but an abundance of orphans.

US Dollar Long Term Chart

I would like to reiterate that because its weightings and composition no longer reflect the reality of the international monetary system that the US Dollar Index will continue to become increasingly less informative and relevant.

 

The existing weightings and inclusions are shows in the pie symbol on this dollar chart. 

But it does serve as a vehicle on which to locate certain key events.

You may 'right click' on the chart to save it to your computer for closer inspection.

Gold Daily and Silver Weekly Charts - Fly the Skies of Air Fed To and Through the Next Crisis

The head of the Secret Service was sacked today in light of the latest revelations of incompetence.

A man armed with a knife jumped the fence, ran unimpeded across the lawn, through the unlocked front door, and went to the furthest part of the White House before being challenged and stopped, ten minutes after the President and his girls had walked out of the building.

A number of bullets were fired at the White House from an assault rifle striking it, shattering one of the windows, and no one even knew about it for four days when a maid discovered it.

And now we find that the Service allowed an armed man with a criminal record on the same public elevator with the President, not even knowing he was lethally armed until later when his supervisor asked him to surrender his weapon.

Some suggest that President Obama was being given a message. While that is possible, I never like to attribute to malevolence what can be just as easily attributed to human folly.  And we have that in abundance.

The latest revelations about the deference and incompetence that the Fed has been routinely displaying both before and AFTER the financial crisis makes one wonder. As you probably do not recall, I objected strongly to the Fed taking on additional regulatory responsibilities in the aftermath of 2007.

Why? Because the Fed is a private entity, owned by the Banks, cross culturally incestuous in their thinking and career paths, and lacking all the resolution for law enforcement and challenging the status quo.  This is exactly what a reformer must be willing and able to do if a system is to be changed.

The world's economy was brought to the brink of the abyss by a group of large multinational Banks engaging in massive control frauds and leverage driven financial distortions. And six years later the Banks are larger, and more leveraged,  even more powerful, and doing the same old things all over again. 

The wealth gap is grown larger to historic proportions, and the vast majority of all stimulus is flowing into the pockets of the richest few.  And the Fed and the government keeps blundering on, taking their cues from the moneyed interests.

And now we are once again off nation building again in the Ukraine and Syria, with rebels who are either crypto fascists or terrorist rebels, while our own infrastructure ages and decays. Our healthcare system lacks all proportion and principled decency.

This is not realpolitik. This is not democracy. This is kleptocracy gone mad with power, grabbing all that they can while they can.  This is a willful few pursuing their own whims of money and power.  And the English speaking world seems to follow the leaders.   Madness.

This will most likely not end well.   But it will end.   Protect yourselves, and not just your wealth.

"Plunderers of the world, when nothing remains on the lands to which they have laid waste by wanton thievery, they search out across the seas.  The wealth of another region excites their greed; and if it is weak, their lust for power as well.  Nothing from the rising to the setting of the sun is enough for them. Among all others only they are compelled to attack the poor as well as the rich. Robbery, rape, and slaughter they falsely call empire; and where they make a desert, they call it peace."

Tacitus

Have a pleasant evening.

The Fed believes in preparation, and vigilant regulation.  Trust them, and sleep well.