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.