A comprehensive round table market wrap
Chris Temple, Gary Savage, and Richard “Doc” Postman all weigh in on what happened in the markets today and where they see them going. There are a couple differing opinions especially when it come to gold and gold stocks.
Click download link to listen on this device: Download Show
always a good listen to……..
He is a very interesting man.
Even if he plagiarized his book. . .
I saw an interview in which Griffin gave Mullins plenty of credit. I don’t know if I can find it now, but I remember it well.
If true, Matthew, my opinion of Griffin is rehabilitated a bit. I’ve met few more gallant, wise and yet humble men than Eustace Mullins.
I never met Mullins but your description of him seems accurate based on his interviews.
Did folks here notice that during the rather extreme movement of stocks on Monday morning there were varying bid-ask spreads and at the height of the volatility some doubled? I take that primarily as a major sign of lack of liquidity.
Mr. Temple is clearly correct.
This could, indeed, be a major problem.
Here’s a blurb on Eustace Mullins and his book (whose idea he got from the poet Ezra Pound) if we are giving credit where credit is due. It was a homework assignment from Ezra Pund to Eustace Mullins to find out the backstory of the Fed.
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In Mullins on the Federal Reserve (1952), (the updated edition published in 1983 was called Secrets of the Federal Reserve) Mullins argued that there was a conspiracy among Paul Warburg, Edward Mandell House, Woodrow Wilson, J.P. Morgan, Benjamin Strong, Otto Kahn, the Rockefeller family, the Rothschild family, and other European and American bankers which resulted in the founding of the U.S. Federal Reserve System. He argued that the Federal Reserve Act of 1913 defies Article 1, Section 8, Paragraph 5 of the United States Constitution by creating a “central bank of issue” for the United States. Mullins went on to claim that World War I, the Agricultural Depression of 1920, the Great Depression of 1929 were brought about by international banking interests in order to profit from conflict and economic instability. Mullins also cited Thomas Jefferson’s staunch opposition to the establishment of a central bank in the United States.
In the 1983 edition of his book, he argued that Kuhn, Loeb & Co. and the House of Morgan were fronts for the Rothschilds. In this edition, he also outlined how financial interests connected to the J. Henry Schroder Company and the Dulles brothers financed Adolf Hitler (in contrast to the claims of his mentor, Ezra Pound, that Hitler was a sovereign who was completely against the interests of international finance.[18] ). He also alleged that the Rothschilds were world monopolists. He furthermore claimed that most of the stock of member banks that owned stock in the Federal Reserve was owned by City of London bankers, since they owned much of the stock of the member banks. He attempted to trace stock ownership, as it changed hands via mergers and acquisitions, from the inception of the Federal Reserve in 1913 to the early 1980s.[19]
In the last chapter of the book, he noted various Congressional investigations, and criticized the immense degree of power that these few banks who owned majority shares in the Federal Reserve possessed. He also criticized the Bilderberg Group, attacking it as an international consortium produced by the Rockefeller-Rothschild alliance. In an appendix to the book, he delved further into the City of London, and criticized the Tavistock Institute of Human Relations, which he claimed helps to conduct psychological warfare on the citizens of Britain and the United States.
A central theme of Mullins’ book is that the Federal Reserve allows bankers to monetize debt, creating it out of nothing by book entry, and thus they have enormous leverage over everyone else. Near the end of the book, he said of the Federal Reserve:
“The Federal Reserve System is not Federal; it has no reserves; and it is not a system, but rather, a criminal syndicate. It is the product of criminal syndicalist activity of an international consortium of dynastic families comprising what the author terms “The World Order”. The Federal Reserve system is a central bank operating in the United States. Although the student will find no such definition of a central bank in the textbooks of any university, the author has defined a central bank as follows: It is the dominant financial power of the country which harbors it. It is entirely private-owned, although it seeks to give the appearance of a governmental institution. It has the right to print and issue money, the traditional prerogative of monarchs. It is set up to provide financing for wars. It functions as a money monopoly having total power over all the money and credit of the people.”
my comment about the bid-ask spread, was for Dow stocks, during a period of HIGH volume. It was not a situation of no bid, but could have been indicative of the size of blocks of shares being traded.
Now I will post a number of citations to commentaries, which I hope folks will find relevant:
http://www.telegraph.co.uk/finance/economics/11820817/Chinas-market-Leninism-turns-dangerous-for-the-world.html
I thought that the manipulation of gold and silver prices on the COMEX would because of a lack of physical supply.
There was some signs that a few weeks ago silver was running out.
I was wrong the manipulating banks have been brilliantly out-maneuvering others and silver supply will not cause cash settlement on the COMEX, it appears.
http://srsroccoreport.com/when-the-global-silver-shortage-arrives-it-will-be-too-late/when-the-global-silver-shortage-arrives-it-will-be-too-late/
I do not believe we will have inflation immediately, but we will print QE, bigger than the last time and it will lead to either inflation or system collapse.
http://sgtreport.com/2015/08/black-monday-the-final-bullet-the-fed-will-hyperinflate-andy-hoffman/
I wonder why the Mexican Bolsa only went down about 1.5% today?
Having watched the PPT intervention, and recognizing this is a worry when geared shorting the market I sold off my shorts at about 3:30 p.m. ET Monday, anticipating another effort by the PPT toward market close or in the morning. I expect the US market to open UP sharply Today.
Cory,
Thanks for putting together the market wrap. Good stuff from everyone.
Agreed. I like these market wrap ups, as many times the closes provide a much different perspective than the early morning hours may indicate. Most traders use the closing prices or intra-day highs/lows in their technical analysis, and it is nice hearing everyone on the same panel when they agree and disagree, and why they feel that way. Good stuff!
Thanks Peter! That was my laugh for the day.
double ditto……….what a dit……..to
I would like to see the look on my grandfather’s face when the author told him that after smuggled gold saved his life back in China in 1949. What is a life worth?
really………me to……….
Al,I would love to hear the guts of that story some time.I think it is an important lesson for all of us but especially the day traders that love to bash gold and those that cling to it as a safe haven on this site.
That was a great, Cory. It was so long it almost felt like half a weekend show. Seems like the guys are thinking along similar lines but the differences mainly come down to timing the end of the commodity bear market. Everything will not see its final lows at the same time though so maybe its nothing to sweat about. What’s important to recognize is the general trend in a complex, varied market driven by a range of different fundamentals, policy pressures and speculative forces. Its why I use the indexes so much. How else can we reconcile wheat crops and surplus beans with mining output or consumer demand for cotton? Amazingly though it really is possible to make sense of the world if we use our charts judiciously and apply some common sense. Anyway, thanks again for a great show.
I am really sorry that I did not take part. Oh well, cardio rehab is pretty important for this old guy!
Hope the rehab is going well Big Al and hope all the best for the Mrs. You’ll be in much better shape soon than any of us sitting around looking at our monitors all day.
Excelsior!
One day at a time…………. fear not(you know the rest of the verse)owl………….ootb
Excellent market wrap, thank you, all!
I AGREE with Chris on long term……………
I’m not a cycles guy, but I think Gary’s got the PM sector dialed in. I’m waiting for a bounce soon. I have no interest in the S&P, as the PM sector seems to be bottoming, finally.
Besides GDX, I have an eye on TBT and XLE as well.
fyi I have no interest in the S&P because I think the Fed still will fight this drop, and so for me shorting is extremely dangerous.
I agree Bill — kudos to those who’ve made money shorting this mess, but I don’t expect the Fed or China to give up without a fight.
I did okay Bill in Tokyo, but, admittedly, I did sell a bit early. But, like I have said many times in the past “a profit is a profit”! My old friend Zig Lambo told me that!
I have the same tendency Big Al. I am good at picking winners, and fairly good at picking turns, but I get a little trigger happy on the sell button. People could make a fortune trading with me and holding on for 1-3 days longer when I sell (tragic comedy) 🙂
Congrats again on the successful short of the markets….it’s been a risky endeavor these last few years.
Remember the Fed has your back……………. 🙂
See up above the selection from Eustace Mullins on the Federal Reserve system. I’m not sure they have anyone’s back but their own….. 😉
ditto….on that one……….
very good interview thank you=
NO Agatha, thank you!
Great dialogue. bit not sure I agree with everything said.
First, I think we are in an enormous Fed induced bubble of epoch proportions. For months, if not years many of the regular guests have alluded to that fact. Simply put, hot air and virtual money printed out of thin air. The air is coming out of that balloon–against that backdrop, what’s up for debate is how hard that balloon is to hit the earth as the reality of gravity takes over.
Second, the EPS of the major indexes remain artificially elevated by companies cannibalizing themselves–stock buybacks and spin-offs vs real top line revenue growth. Hardly, an economic indicator portending future prosperity.
…And as far as commodities, specifically oil and the industrial metals, they are the canaries in the coal mine. They are the building blocks of growing economies. They collapsed because there is little demand…. ….And as for precious metals, the paper market–which is settled in ink or simply numbers churning on high speed computers. It will forever be bridled by naked short sellers of investment ‘banks’ doing the bidding of the worlds central banks, especially the Fed.
All in all, the markets are ‘markets in name only’ and will remain thoroughly a corrupt virtual reality until we see another Glass Steagall–which will never happen without a massive global stock market crash–which, by the way, is not out of the question at this point.
These are interesting times to say the least BJ!
This time things are different, I don’t see Hank Paulson coming on TV like in 2008 and saying we have a real crisis here and we have to support the banks and the markets or the system is in real trouble, now the invisible hands are tied and whatever happens they know interference will not cure our economic woes.
Interesting comment DT
Thanks for the market wrap, guys! Y’all are great!
Many thanks Wiseguy. Look for one everyday from now on.
Now that securities are seeing a mark down in prices as well as commodities, I think real estate will be next, are we not in a period of deflation.
Gary, the banks did not close near the lows today. They closed near the highs.
The KBW Bank Index closed very close to its low for today.
http://stockcharts.com/h-sc/ui?s=%24BKX&p=D&yr=1&mn=0&dy=0&id=p11787798179
PF,
Maybe in anticipation of next QE.
The dollar better turn up hard and soon if it’s to avoid a meltdown.
http://stockcharts.com/h-sc/ui?s=%24USD&p=W&yr=5&mn=3&dy=0&id=p13637538522&a=417764197
NO QE
Dow Theory & Gold’s Strong Season 321Gold
Stewart Thomson
email: stewart@gracelandupdates.com
email: stewart@gracelandjuniors.com
email: stewart@gutrader.com
Aug 25, 2015
Have US stocks entered a bear market?
In most assets, MSM (mainstream media) uses a 20% decline as a rule of thumb to define a bear market. While an asset that’s declined 20% might be in a bear market, that rule of thumb is at best a very crude attempt to define the overall price action.
Different assets require different rules of thumb. Dow Theory provides a time-tested means of classifying the US stock market as bullish or bearish.
On that note, please click here now. That’s the weekly chart of the Dow Jones Transportation index.
Next, please click here now. That’s the weekly chart of the Dow Jones Industrials index.
In terms of time, a Dow Theory sell signal is quite a long process; both averages must make a series of lower intermediate trend lows and highs. In the case of the current market, that may happen, but it hasn’t happened yet.
The professional Dow Theorist is now watching for an intermediate trend rally to occur in both averages. If they fail to breach the recent highs, that in itself is not a sell signal.
A sell signal would occur only if both averages then decline and close below yesterday’s closing prices.
For decades, I have defined the August 7 – October 31 time frame as “crash season”. There’s no question that current US stock market price action is very concerning.
The real risk of being invested in US stocks during these three months dramatically outweighs any potential reward. That’s because generational wealth can be destroyed in a few days, weeks, or even hours. August is typically the set-up month, and the crash and/or ensuing bear market occurs in either September or October.
Please click here now. That’s a monthly chart of the Dow Industrials. The uptrend from the 2009 lows has been broken, and the key 5,15 moving average series is rolling over, ominously. I’m a buyer of the Dow only at 14,200, which is where massive buy-side horizontal support (HSR) begins.
Gold and silver enthusiasts are disappointed that there was not a rush into gold as the Dow tumbled. The SPDR ETF holding did rise modestly, from about 677 tons to 681, but yesterday’s price action was slightly negative.
The safe haven trade for gold relates more to key bond markets than to stock markets. In my professional opinion, there are two reasons that Janet Yellen would hike rates. The first is to boost money supply velocity (by boosting bank loan profits).
I also think that Janet shares Alan Greenspan’s concerns about the long term economic problems caused by the size of government. Military spending and entitlement programs don’t do much for money supply velocity. In contrast, by raising rates, Janet can direct institutional liquidity flows away from the T-bond market, away from government, and into the private sector.
Rate hikes can reverse declining money supply velocity, and potentially quite violently. That’s good news for gold and silver bugs! Obviously, I’m 100% in favour of a September rate hike. Regardless of when it occurs, global stock and bond markets could stage a horrific meltdown after the first rate hike, while gold and silver rally strongly!
Fortunately or unfortunately, depending on your perspective, most of the price action in the gold market is not directly related to economic events in the West. It’s mainly related to demand for gold jewellery versus mine and scrap supply in India. The key point is that when Indian demand is very strong, gold-bullish events in the West can cause enormous surges in the price.
Likewise, when Indian demand is tepid, events in the West that “should be bullish” don’t have much effect on the price, and that can frustrate gold enthusiasts. Ominously, when Indian demand is weak (typically from February to July/August), events in the West that are bearish for gold can cause substantial declines in the price.
The good news right now is that Indian jewellers, refiners, and economists are forecasting very strong demand over the next four months! That means any event in the West that is even modestly bullish for gold could send the price much higher.
Please click here now. Indian Dore bar imports are surging, with refiners predicting 50% growth this year. The lower duty is a key factor, and I expect this to continue for many years.
China is also a key source of demand for gold. Please click here now. That’s one take on China, from a key Goldman Sachs analyst. I’ll add that Hong Kong’s stock market sports an average P/E ratio of about 8. The PBOC has plenty of room to cut rates substantially, and the country has almost $4 trillion in FOREX reserves.
The Chinese stock market is suffering a hard landing, but I don’t see the Chinese economy suffering the same fate. Even if there is a hard landing, China doesn’t need to grow dramatically to boost gold demand consistently. Modest growth is fine, and that’s in play now.
Another overlooked area of gold demand is Iran. I’ve predicted that Iran will become an economic “powerhouse”, while Saudi Arabia declines. Please click here now. Iran bought a staggering 200 times more gold jewellery from Turkey this year than last year. Switzerland has also started re-exporting gold to Iran. Once all the Western sanctions are gone, I’m projecting that Iranian gold jewellery demand will reach 300 – 400 tons a year very quickly, making it the third most important gold market in the world!
Please click here now. That’s the daily gold chart. After what is roughly a $100 rally, investors need to be patient, and prepare for a pullback. Please click here now. That’s another look at the same chart. There may be a second flag pattern forming, which is very bullish. A pullback to $1125 is more likely, but overall the chart looks solid.
Please click here now. That’s the GDXJ weekly chart. There’s a great looking bull wedge pattern in play, with an intermediate term target of $45. I realize that junior gold and silver stock enthusiasts are in a bit of pain after yesterday’s general market meltdown, and there could be more if gold declines to the $1125 area. Investors don’t need to “grin and bear it”. They need to grin and buy it! The strong season for gold is off to a typical start, with gold quite strong, and the stocks very volatile. The junior gold stocks will take the lead baton soon, and start the rise to $45 on the GDXJ chart!
Aug 25, 2015
Stewart Thomson
Graceland Updates
I picked up some XIV this morning to play the reverse in volatility today. It seems to lagging what I expected it to do compared to the downward slide in the VIX proxies, but it is still moving up nicely.
In addition, I started a new JNUG position just a bit ago, in case the miners feel like bouncing after the sell off yesterday and this morning. It’s up so far, but we’ll see how it goes today.
My feeling is silver needs a little more work on the downside before a reversal for both metals but that should arrive by tomorrow. Gold is a little hung up here and not quite ready to move yet.
I have not given up yet on silver.
I haven’t either. Of all the metals I expect Silver to outperform in the longer term.
Please note, I am not posting this while the market is open:
First an explanation of the Federal Reserve:
https://youtu.be/Dba9OY0QatU
Next a statement from myself, and you will see many others, that we may now anticipate QE ……until the system collapses.