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Tuesday October 28, 2014
tableTable of Contents
holterThe Holter Report
bill holter
Bill Holter

The Bear Growls Publicly 

October 28, 2014

 

I plan to report more about the New Orleans investment conference and in particular what Alan Greenspan had to say later in the week.  Today I want to speak about several pieces of news from late last week which I believe were important.  Though these are seemingly not "connected," I believe there is a very strong connection for most of it but to this point only behind the scenes.

 

First, Russia reported the import of 1.2 million ounces of gold last month.  This is a big jump from what they had been previously importing.  Earlier in the year if I recall they were running some 300,000 ounces per month and they have now begun to increase this rate.  Why is this significant you ask?  Because Russia has been under U.S. sanctions for the last 3+ months.  If the sanctions were truly biting and crippling Russia, they would not have the financial ability to import any gold at all, much less increase the amount dramatically.  Maybe the Chinese are lending them a hand or Russia is acting as a proxy for Chinese buying?  I have no idea but Russia increasing their imports of gold certainly was not what Washington envisioned as a result of sanctions I am sure.  As a side note, we also got the weekly gold import numbers out of Shanghai.  Another 50+ tons after 68 tons the week before, how much longer can China buy nearly ALL global production?  The answer of course is until the Western vaults are empty.  

 

Speaking of "empty vaults," JP Morgan reported 321,500 ounces of eligible gold withdrawn from their vault last Thursday.  This is interesting because it is now the 3rd time in the last two months JPM has had this exact 10 ton withdrawal.  We do know that this is "kilo" gold and not "ounce" gold because of the reporting.  Were it N.Y. or London style bars we would see a report of "._ _ _" because the 100 ounce and 400 ounce bars are never exact round number weights, they are "point, something something something."  In just the last 2 months, JP Morgan has seen over 75% of their eligible gold withdrawn and now stands under 500,000 ounces.  Because the East buys and trades in kilos rather than ounces, this may be an Eastern withdrawal or is actually being shipped East, no way to tell.  

 

Getting back to Russia, Mr. Putin has finally spoken out in aggressive fashion.  Late last week he made several statements including, "There is risk of major conflict, the U.S. dollar is losing trust as a reserve currency and the U.S. cannot humiliate its partners forever."  Why has he chosen "now" to become boisterous?  There can be several reasons individually but most probably all have come together at one time.  First, surely none of what he said would be done without the knowledge and approval of China.  Secondly, he has just finished many rounds of talks with Middle East nations where I am sure trade, finance, energy and "protection" were all discussed.  You can also add to this, November 1st is now only a week away and with it comes the calendar beginning of cold weather.  Russian gas supply to Europe is a trump card that no amount of "dollars" can beat, not even if you burn them all for warmth.  You see, Mr. Putin has the ability right here and now to blackmail much of Europe into fracturing away from the U.S.  

 

Did he speak during his talks to Arab oil producers regarding "his markets" and his expectations that the Arabs not fill any void he creates?  Probably, I certainly would.  Please keep in mind that Russia has been militarily "probing" NATO everywhere on the planet.  They in my opinion are testing our response times and also showing us they are no longer a broken state.  Russia also last week sent military equipment and personnel to the hotly disputed Arctic Circle.  Does he plan to plant a Russian flag and thumb his nose at the U.S., Canada, Norway and Sweden?  Again, probably.  

 

As to the Mr. Putin's "timing," it is not just the cold weather coming.  It just so happens the U.S. Fed is now about done with the current round of QE.  Our markets are beginning to convulse and the calls for renewed QE can be heard even from within the Fed itself.  This, at the same time Europe reported a banking stress test with 25 failures and 100's of billion euros in new capital needed.  Please remember, Mr. Putin is a brilliant guy and can do logic as well or better than anyone.  He sees the West's economies and financial systems weakening and knows the Achilles Heel to the system is physical gold.  While we have tried to isolate Russia, they have firmed up allegiances with China, the rest of the BRICS and now even Middle East oil producers.  

 

NONE of what Mr. Putin says or does is by mistake or coincidence, everything is planned and done so well ahead of time.  Do you really believe earlier in the year he would have pushed Russia's position when it would be stronger in 6 months' time?  Russia now has more alliances, trade deals signed, gold and Chinese backing than ever before, ...while the West has accumulated more debt, printed more currency, cut military numbers and EXPORTED gold not to mention "weakened relationships" internally.  This is not rocket science, the West has been declining for years and is now 6 months weaker while Russia/China et al are rising and are 6 months stronger and wealthier.  

The fact that 'the Bear' is now growling publicly should not be overlooked as Mr. Putin would not do so, so loudly unless he was already in position. 

 

 

hoffmanAndy Hoffman's Daily Thoughts

The All-Time Biggest Lie

October 27, 2014

 

In TPTB's desperation to "manipulate, jawbone, and pray" equities back up, both the frequency and blatancy of government intervention has achieved unprecedented levels. Not only are they in full-fledged panic mode for its own sake, knowing the world has returned to "2008, with one temporary exception," but a slew of potentially cataclysmic - and Cartel-destroying - events are upcoming like Wednesday's expected "QE-ending" FOMC meeting, next week's mid-term elections, the Catalonian secession referendum November 9th and the "granddaddy of them all" November 30th, when the Swiss decide whether to re-link the Franc to gold. This is particularly true in the United States of Financial Mass Destruction, where the PPT has supplied "dead ringer algorithms" in each of the seven dayssince last Wednesday's liquidity vacuum, despite an unrelenting onslaught of global horrible headlines.

 

To wit, European equities have barely rebounded, whilst the "Dow Jones Propaganda Average" has "miraculously" recouped nearly all its losses, via its best week in 21 months - for absolutely ZERO reason other than manipulation. Conversely, precious metals have been attacked with a vengeance even I am shocked by - albeit decidedly unsuccessfully as gold remains well above its "triple-bottom" low of $1,180/oz. As for silver, this week's paper raids cannot be described any better than "Cartel Suicide" - as at current prices, production will collapse into oblivion and the mining industry will vanish (wait until you see the downward reserve revisions if silver ends the year in this price range). Throw in the fact that base metal prices are crashing as well - with an utterly catastrophic near-term outlook; and the prognosis for silver by-product mining is equally bleak. Meanwhile, this "perfect storm" is only growing more powerful, as worldwide physical silver demand has never been higher - and at least one miner, First Majestic, is withholding production and calling for creation of a "silver Cartel." Below, take a gander at Friday's blatant market intervention" - featuring prototypical "dead ringer" algorithm for the Dow; PM waterfall declines at the 10:00 AM EST "key attack time"; and equally blatant DLITG, or "Don't Let it Turn Green" algorithms thereafter.

 

  

  

In the PMs case, such manipulation was particularly egregious - as for the first time ever, they were attacked in response to terrible economic news! First on Thursday, when PMI manufacturing "unexpectedly" declined sharply; and then Friday, when the "all-time biggest lie" - i.e., last month's new home sales report - was exposed for the fraud it was. But more on that in a moment.

  

 

 

 

While the MSM distracts the handful of people still paying attention with hysteria about two or three Ebola cases, real horrors are occurring the world round - particularly as relates to the outlook for financial assets.



In China, new price data depicts its historic real estate bubble is rapidly deflating; whilst in Europe, debt and unemployment continue to rocket higher - with even the perpetually cheerleading Markit organization admitting it.

 

The Eurozone PMI shows the region teetering on the verge of another downturn. Growth is so anemic, increasing numbers of companies are being forced to lay off staff and slash prices in an attempt to cut costs and boost sales through discounting.

-Markiteconomics.com, October 23, 2014

 

Moreover, an astonishing 25 European banks or 20% of the total failed the ECB's latest "stress test" simulation; which, given how easy such tests are, suggests countless banks are on the verge of being the next Espirito Santo. Consequently, "Goldman Mario" was out in full force Friday morning, jawboning in grand fashion for more money printing. Unfortunately, it didn't work - as unlike the powerful algorithm programs of the U.S. PPT, European interventions couldn't prevent yet another sell-off. Friday's report that French joblessness hit an all-time high depicts just how close Europe is to the precipice; and next month's planned, nationwide worker strikes in Greece will highlight it further.

 

 


Meanwhile, as Amazon.com validated what we wrote in this summer's "need or want, demand is dying," Sears announced massive store closings as the "changing of the guard" intensifies. Thus far, the 3Q earnings season has demonstrated a third of the Dow's components posting flat or lower revenues; and even yesterday's surprise Saudi production cut couldn't prevent oil from challenging its multi-year lows. And speaking of "changing of the guard," consider what stocks and precious metals would have done in freely trading markets, in response to what the leader of America's most powerful enemy said Friday morning.

 

 

 
However, even these "horrible headlines" don't hold a candle to the fraud that was yesterday's U.S. "New Home Sales" report based on the massive downward revision of August's data. To that end, recall last month's initial reading, in which it was reported that new home sales rocketed higher from 404,000 in July to 504,000 in August. Never mind that new homes account for just 5% of the total home sale market, and that such an explosion made absolutely ZERO sense when considering all other housing data such as the horrific downward trend of the 95% of the market represented by existing home sales. Or, for that matter, the admitted 15% margin of error; or, as demonstrated below, the fact that essentially all previous numbers (especially "strong" ones) have been revised sharply lower.

Zero Hedge

As you can see, August's "504,000" home sales were revised to just 466,000. Moreover, given this data series' lamentable history, it's highly likely September's pitiful 467,000 figure will be revised lower as well, perhaps significantly so. Next, consider that when the initial August figure was published on September 24th (what a shock at 10:00 AM EST), the Dow surged more than 150 points due to "recovery" excitement, whilst gold was subjected to yet another $10/oz. waterfall decline. In other words, every imaginable aspect of this report was fraudulent exposing both the U.S. economy for the "island of lies" it is, and its "markets" for the sham they are. In fact, when I saw this report emerge - again at 10:00 AM, after which stocks surged whilst PMs plunged - all I could think of was the great scene in "Stand by Me," when the kids executed the "all-time train dodge." Hence, today's article title.

 

 

 

 

Of course, no matter how corrupt TPTB are they can't manufacture gold. Supply and demand have never been tighter; and as discussed in this brilliant article, it's highly likely the Cartel's "end game" is rapidly approaching; perhaps, far sooner than most can imagine. Which is why we repeat our mantra - on this, my third anniversary at Miles Franklin - to PROTECT YOURSELF, and DO IT NOW!

 

 

interviewInterview with Kerry Lutz

Nothing Has Changed, and Nothing Will

October 28, 2014

 

Andy Hoffman joins Kerry Lutz of the Financial Survival Network to discuss the upcoming FOMC meeting, the Swiss gold referendum, markets are crashing worldwide and surging physical demand of gold and silver.  To listen to the interview, please click below.  

 

recapMarket Recap
Monday October 27, 2014




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