Implode-Explode Heavy Industries news feed

Sprott: Silver is Below Cost of Production

Sun, 08 Dec 2013 14:10:25 GMT

``The price has fallen so fast that it has been difficult for most miners to adjust their costs appropriately and the price for silver has dropped below its marginal cost of production. In a note last month, Dundee Capital Markets revealed that the all-in cash costs of the silver producers it covers fell an average of 13%, to $20.08 per ounce, during the third quarter of this year.4 With silver languishing at approximately $19, most major miners are losing money on every ounce produced. We have already begun to see production increases curtailed in this new environment, which should give further support to the metal price in the future.''

Volcker Rule To Scrap "Portfolio Hedging", Would Make Trillions In Excess Deposits Inert

Sun, 08 Dec 2013 04:29:58 GMT

In a defeat for Wall Street, the "Volcker rule" won't allow banks to enter trades designed to protect against losses held in a broad portfolio of assets, according to people familiar with the rule. The practice, known as portfolio hedging, has become a focal point of regulators drafting the rule, a controversial plank of the 2010 Dodd-Frank financial law that seeks to prevent banks from putting their own capital at risk in pursuit of trading profits.

But it won't contain language permitting portfolio hedging, which has been "expunged" from earlier drafts of the rule, according to a person familiar with the matter. Regulators decided to remove portfolio hedging from the rule after J.P. Morgan Chase disclosed billions of dollars in losses from its so-called London whale trades in 2012.

Alex Stanczyk: Physical Supply Never Tighter, as Gold Flows East

Sun, 08 Dec 2013 04:26:54 GMT

``...At this Swiss refinery there have been several times this year on which they were unable to source gold, this shocked me. They're bringing in good delivery bars, scrap and dore from the mines, basically all they can get their hands on. This gentleman has been in the business for 37 years, he was there during the last bull market in the late seventies. I asked him when was the last time this has happened, that he was unable to source gold, he said never. And I clarified it, I asked: let me make sure if I understand what you're saying to me, in the last 37 years you've worked in the gold industry this has never happened? He said: this has never happened.''

Dr. Marc Faber; "World Central Bankers Are Going To Bankrupt The World"

Sun, 08 Dec 2013 04:20:09 GMT

While the headline statement is sensationalist, it is always good to get a general (and in this case, comprehensive) market update from Faber.

LME faces tough job in releasing data to boost transparency

Sun, 08 Dec 2013 04:19:09 GMT

``The London Metal Exchange (LME) faces a tough job as it gears up to provide more data about long and short positions, including delivering what many investors crave - information on flows of speculative money that move markets.''

Leeb - China Mining Some Gold For A Staggering $2,500 An Ounce

Sun, 08 Dec 2013 04:16:05 GMT

``So here you have a country that is buying gold hand-over-fist, and they are mining gold as if they know it's going to be priced at a minimum of $2,000 to $2,500. As an investor, I'm not going to fight them. It's one thing to say, ‘They are buying gold.' Well, they are buying gold at around $1,200, but it's another thing to see them mining gold at all-in cash costs in the $2,000 to $2,500 range on some of these projects in China.'' -- There's another implication not mentioned here. If China really is mining some gold (internally) at a much higher price, while simultaneously buying it off Western exchanges at around $1200/oz, the only logical reason to do so would be if it could not physically get as much gold as it wanted from the West (or expected that very soon it would not be able to).

Europe repeating all the errors of Japan as deflation draws closer - Telegraph

Sun, 08 Dec 2013 03:45:12 GMT

``Europe's slide towards deflation is replicating what happened in Japan in the 1990s at the onset of its lost decade, when trouble crept up on the country unawares. Near zero inflation seemed harmless until world events suddenly intruded: the Russian default and the East Asian crisis of 1998, the dotcom bust in 2001-2002.''

REFILE-China's biggest jeweller sees gold in the masses

Sun, 08 Dec 2013 03:41:22 GMT

``Chow Tai Fook's fashion jewellery, which costs between HK$200 and HK$2,000 ($26 and $260), is a far cry from the luxury offerings that have traditionally accounted for over 80 percent of sales, and which on average cost about 10 times as much... the shift to expand mass-market retail is already paying off. Chow Tai Fook saw its net profit rise by a forecast-beating 92.3 percent in the six months ended September, with same-store sales growing 33.2 percent.''

Bull market or bear market -- where does gold stand now?

Sun, 08 Dec 2013 03:40:14 GMT

``Rick Rule in his presentation on the Tuesday pointed back to 1975 as being what he thinks is likely to happen again. Those with long enough memories may recall that gold virtually halved in price back then over a 2 year period down to close to $100. Commentators and analysts at the time were predicting falls back towards the $40 level from whence it had risen over the previous three years. It had been truly written off, but this was the inflection point after which gold rose about eight times up to around $800 plus before it came crashing back down again to settle at the level from which the recent, or current if that's your viewpoint, bull market developed.''

The `GE Three', Vilified by Taibbi, Go Free

Sun, 08 Dec 2013 03:34:02 GMT

``"Someday, it will go down in history as the first trial of the modern American mafia," Taibbi began his June 2012 opus about Dominick Carollo, Steven Goldberg and Peter Grimm. "Over 10 years in the making, the case allowed federal prosecutors to make public for the first time the astonishing inner workings of the reigning American crime syndicate, which now operates not out of Little Italy and Las Vegas, but out of Wall Street."... Then came a surprise last week, right before Thanksgiving. A federal judge ordered the men released from prison. An appeals court had reversed their convictions the day before, without explanation. An opinion would be issued "in due course," it said. Bloomberg News ran a short story this week. The rest of the news media barely noticed.''

Gold Is Disappearing from the West: Alasdair Macleod

Sat, 07 Dec 2013 18:37:32 GMT

``Price suppression can only be a temporary stop-gap, and there has never been sufficient supply to allow the central banks to retrieve their leased gold from the bullion banks. Therefore, Frank Veneroso's conclusion in 2002 that there had to be existing leases totalling 10-15,000 tonnes is a starting point from which leases and loans have increased...''

Auto Lending Standards Plunge: New Car Loans Average 110% LTV; Used Car Loans 133% LTV with 55% Subprime!

Sat, 07 Dec 2013 17:52:54 GMT

``Repossessions are up sharply, but who cares about that? No doubt the loans are sliced, diced, tranched, and securitized to make them appear as AAA. Pension funds are probably dumping gold to load up on them.''

Turkey imported 270.7 tonnes of gold till Nov

Sat, 07 Dec 2013 17:41:31 GMT

``Turkey imported 270.7 tonnes of gold in the first 11 months of the year, data from Borsa Istanbul showed, more than double 2012's full-year imports of 120.8 tonnes. Turkey, like most of the price-sensitive markets, saw this year's lower price level as an opportunity to replenish stocks and release some of the pent-up demand that has been building as consumers have been priced out of the market," Cameron Alexander, an analyst with Thomson Reuters GFMS, said. "Official coin demand has more than doubled, investment demand has also more than doubled, and jewellery demand has rebounded by around a fifth this year."

Yet another massive nail in the dollar's coffin

Fri, 06 Dec 2013 20:50:40 GMT

It was a Memorandum of Understanding signed by representatives of the Singapore Exchange and Hong Kong Exchange. Their aim-- to combine their forces in rolling out more financial products denominated in Chinese renminbi.
...
We'll soon see more financial products-- oil, gold, Fortune 500 corporate bonds, etc. denominated in renminbi and traded in Asia. And as trade in these renminbi products grows, the dollar will be closer and closer to its reckoning day.

Eyes Turn To The Fed As Unemployment Rate Falls To 5-Year Low

Fri, 06 Dec 2013 20:27:25 GMT

"It's a significant report for the Fed to decide whether to begin winding down its bond-buying stimulus program," NPR's Yuki Noguchi tells Morning Edition. "They've been buying $85 billion a month in mortgage-backed securities, which is basically like a money spigot, putting money back into the economy. And they've been debating when to turn that money spigot off."
...
While the November jobs report is largely positive, MarketWatch notes that there are some caveats: "As many as one-fourth of the jobs created last month could reflect seasonal hiring that will dissipate after the holidays. And the number of long-term unemployed -- people out of work for at least six months -- was basically unchanged in November at 4.1 million''

Grant Williams - Twisted (By The Pool) (Gold manip., and much more)

Fri, 06 Dec 2013 16:35:40 GMT

``If we assume it is a given that, when offered an opportunity to manipulate a price in order to generate huge profits, a group of banks will take it; and if we assume that, just as the five-year investigation into silver markets managed to uncover no evidence whatsoever of price manipulation (despite some overwhelming evidence to the contrary, including Andrew Maguire's now-infamous mind-reading exercise), that the investigation into manipulation of the London Gold Fix will also end up without any charges being laid; then one could argue that the manipulation has been proven, along with government complicity. ''

Jim Rickards: Decline of the Petrodollar System is Good for Gold

Fri, 06 Dec 2013 00:48:08 GMT

``There is ... a newly emerging alliance among Saudi Arabia, Israel, Egypt, and Russia. The new alignment will have no particular use for US dollars and no reason to support them. This turn of events marks the beginning of a significant diminution in the role of the dollar in the international monetary system. Since the price of gold is, in large part, simply the inverse of the value of a dollar, the decline of the dollar will presage a major increase in the dollar price of gold.''

Japan Salaries Extend Slide as Inflation Begins to Take Root

Thu, 05 Dec 2013 23:01:17 GMT

``The slide in wages threatens living standards as consumers face the prospect of sustained inflation on top of a sales-tax increase in April next year. As a weaker yen helps boost company profits, the focus is turning to salary talks early next year that may determine the success of Prime Minister Shinzo Abe's bid to reflate the world's third-largest economy.''

Gold Declines Third Time in Four Days on Fed Taper Speculation

Thu, 05 Dec 2013 21:33:23 GMT

``Gold futures declined for the third time in four days as U.S. economic data reinforced concern that the Federal Reserve will begin trimming stimulus measures, curbing demand for precious metals as a haven. The U.S. expanded at 3.6 percent rate in the third quarter, up from an initial estimate of 2.8 percent, while jobless claims unexpectedly declined to the lowest level in more than two months as of Nov. 30, separate government reports showed today. '' -- The data is probably mostly manipulated, but oh well, it's more important to create a perception of prosperity for just a little longer!

Deutsche Bank quits commodities under regulatory pressure

Thu, 05 Dec 2013 21:09:08 GMT

``Deutsche Bank pulled the plug on its global commodities trading business on Thursday, cutting 200 jobs as it becomes the first major bank to exit the once lucrative sector due to toughening regulations and diminished profits. Germany's largest bank, which was one of the top-five financial players in commodities, will cease energy, agriculture, base metals, coal and iron ore trading, it said in a statement, retaining only precious metals and a limited number of financial derivatives traders.''