Weekend Show – Sat 5 Oct, 2019

Hour 1 – Just How Unstable Are The US Markets and US Economy?

Full Hour

On this weekend’s show we spend the full hour focused on the health of the US markets. We address the recent volatility and weak data that hit the wire day after day plus the upcoming meeting between the US and China next week. There are also some comment son the IPO market and recent major flops.

For anyone who wants some metals commentary be sure to check out the editorials throughout the week. We spend a lot of time discussing gold, silver, and the underlying stocks.

  • Segment 1 – I saw the comments asking to hear from trader Vic so he is kicking off our show this weekend! We discuss markets and monetary expansion as a key consideration.
  • Segment 2 – Dana Lyons is up next with a short and long term outlook for US equities, gold, and the energy sector.
  • Segment 3 – Nick Pardini, Managing Partner at the Davos Investment Group shares his thoughts on the weakness in the IPO market.
  • Segment 4 – Chris Temple wraps up the first hour by looking ahead to the upcoming US and China meeting. There’s a lot to consider as this trade war has turned into something much more than just trade.

Exclusive Company Interviews This Week


Segment 1 – Trader Vic
Segment 2 – Dana Lyons
Segment 3 – Nick Pardini
Segment 4 – Chris Temple

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Comments:
  1. On October 5, 2019 at 3:36 am,
    irishtony says:

    A BIG Thank You to the KER crew for another great weekend show.
    Great interview with Trader Vic.

    • On October 5, 2019 at 7:22 am,
      bonzo b. says:

      +1

    • On October 5, 2019 at 9:44 am,
      Excelsior says:

      +1

    • On October 5, 2019 at 9:54 am,
      Dick Tracy says:

      Irish, I couldn’t agree more! DT

  2. On October 5, 2019 at 4:05 am,
    irishtony says:

    Thanks Cory & chris for seg.4…lots af clarity.

  3. On October 5, 2019 at 9:47 am,
    Excelsior says:

    Negative Rates Are Rewriting the Rules of Modern Finance

    By Brandon Kochkodin – September 30, 2019

    “Negative interest rates have quite literally broken one of the pillars of modern finance.”

    “As economists and central bankers weigh the pros and cons of sub-zero rates and their impact on the world, traders have been contending with a rather more mundane, but fundamental issue: How to price risk on trillions of dollars of financial instruments like interest-rate swaps when their complex mathematical models simply don’t work with negative numbers.”

    https://www.bloomberg.com/news/articles/2019-09-30/how-negative-rates-broke-black-scholes-pillar-of-modern-finance

    • On October 5, 2019 at 9:48 am,
      Excelsior says:

      Fed Extends Repo Operations Through Nov. 4

      By entering the repurchase agreements, or repo, market, the central bank relieves funding pressure in money markets

      The Wall Street Journal – By Kimberly Chin and Dave Sebastian – Oct. 4, 2019

      “The Fed will continue to offer overnight repos, which are meant to relieve funding pressure in money markets, for an aggregate amount of at least $75 billion each night through Nov. 4.”

      “Additionally, the Fed said it would extend its two-week repo loans, as well. It plans to offer at least $45 billion between Oct. 8 and Oct. 11. After that, the amount available will drop to $35 billion through Oct. 29.”

      https://www.wsj.com/articles/new-york-fed-adds-about-38-55-billion-to-financial-system-11570194319

      • On October 5, 2019 at 3:18 pm,
        Excelsior says:

        Buying Opportunities Ahead, Says Louise Yamada

        October 4, 2019 – Financial Sense Wealth Management

        “Ryan Puplava gives this week’s market wrap covering the new jobs report, the decline in ISM Manufacturing data and trade talk potential.”

        “Louise Yamada says she remains on the cautious side and explains why she sees buying opportunities ahead. Then Dan Steffens joins Financial Sense Newshour to discuss oil inventory numbers and the future of oil.”

        “In the Big Picture Jim Puplava and Chris Preitauer delve further into oil. They question if oil is headed for obsolescence or opportunity.”

        https://www.financialsense.com/podcast/19332/buying-opportunities-ahead-says-louise-yamada

        • On October 5, 2019 at 6:14 pm,
          Excelsior says:

          Bank Crisis Hits India: “Bank Stops Functioning, People Crying Outside Bank Branches”

          10/05/2019

          https://www.zerohedge.com/markets/bank-crisis-hits-india-bank-stops-functioning-people-crying-outside-bank-branches

          • On October 6, 2019 at 2:39 am,
            Excelsior says:

            ‘QE Infinity’, MMT And ‘Public-Private Policy Partnerships’ For A Brave New World
            Exploring the future of the monetary-fiscal policy nexus.

            The Heisenberg Report – October 5, 2019

            “Several weeks back, we spoke a bit about the extent to which Mario Draghi’s “QE-Infinity” (subject to the capital key) could actually pave the way for fiscal stimulus to take the reins from monetary policy when it comes to shouldering the burden of engineering sustainable growth and averting a deflationary spiral.”

            For BofA’s Barnaby Martin, one “overlooked” aspect of QE is the way in which it “‘transforms’ sovereign debt-to-GDP ratios by moving bonds from risk-averse investors towards more risk-tolerant central banks”.

            “If QE is sizable enough, the transformation in debt-to-GDP ratios can be meaningful”

            https://heisenbergreport.com/2019/10/05/qe-infinity-mmt-and-public-private-policy-partnerships-for-a-brave-new-world/

  4. On October 5, 2019 at 9:49 am,
    Excelsior says:

    Gold Prices Consolidate in Bull Flag – Key Technical Levels for XAU/USD

    Oct 4, 2019 – Christopher Vecchio, CFA, Sr. Currency Strategist

    “It no longer appears that the gold price head and shoulders topping pattern is valid. Instead, a bullish continuation effort may be taking shape.”

    “Gyrations in global equity markets, sovereign bond yields, and FX markets have produced a caustic environment for precious metals. Sharp declines by gold prices at the end of September and Q3’19 were met with enthusiastic buying at the start of October, largely thanks to concerns over the state of global growth after weak PMI readings across the developed world.”

    “But part of the reason why gold prices have been able to rebound in recent days has been the prospect that the Federal Reserve may need to accelerate its easing efforts as the US economy looks weaker and weaker. The past week’s data was incredibly discouraging: a 10-year low in US ISM Manufacturing; three-year lows in US ISM Services, CEO & CFO confidence; and a six-month low in US retail sales.”

    “With uncertainty on the rise once again, the environment for precious metals is starting to become more appealing. In turn, as volatility rises, one of the two scenarios examined in the last gold price forecast may no longer be valid.”

    https://www.dailyfx.com/forex/technical/home/analysis/xau-usd/2019/10/04/gold-price-forecast-consolidate-in-bull-flag-key-technical-levels-for-xau-to-usd-gold-price-today.html?QPID=30472&CHID=9

    • On October 5, 2019 at 9:50 am,
      Excelsior says:

      Gold: When Chart Patterns Fail

      @Goldfinger on 4 Oct 2019

      “Heading into next week gold bulls should feel pretty good considering that the $1500 support level has held yet again on a weekly closing basis. Moreover, the bears had their chance with a pretty good setup early in the week as Peter L. Brandt pointed out on Twitter (bearish CoT positioning + a chart pattern top), but they weren’t able to sustain the momentum. I think gold still needs some more time to consolidate its big gains since May, however, dips are likely to continue to find strong bid support before an eventual upside breakout (above $1567) later in the year (December).”

      https://ceo.ca/@goldfinger/gold-when-chart-patterns-fail

      • On October 5, 2019 at 9:51 am,
        Excelsior says:

        @Goldfinger – “Bullish engulfing candlesticks all over the place in #gold miners. A powerful way to end the week. $GDX $GDXJ”

        https://ceo.ca/@goldfinger?e57a6a51b5a8

        • On October 5, 2019 at 9:53 am,
          Excelsior says:

          Northstar @Northst18363337

          “#Silver preparing for a major move. It’s just a matter of time. Downside to around $16, upside ? $50+ in my view. A couple of miner charts I’ll be watching in coming weeks/months #preciousmetals”

          https://twitter.com/Northst18363337/status/1179445454901305348

          • On October 5, 2019 at 9:55 am,
            Excelsior says:

            Ira Epstein’s Metals #Video (10/4/2019)

            Technical Analysis, Gold, Silver, Copper, Platinum

            https://www.youtube.com/watch?v=_VasPFvrOp4

          • On October 5, 2019 at 10:00 am,
            Excelsior says:

            Jobs Report Does Little to Move the Needle for Gold Pricing

            Gary Wagner – October 4, 2019 #TechnicalAnalysis #Chart #VIDEO

            https://thegoldforecast.com/video/jobs-report-does-little-move-needle-gold-pricing

          • On October 6, 2019 at 11:29 am,
            Matthew says:

            I think Gary Wagner has it exactly right. So it will be fun to watch the usual guys double down on their bearish calls during the next pullback.

          • On October 6, 2019 at 12:16 pm,
            Matthew says:

            I’m no Elliott waver but I do know that wave 4 is typically much less severe than wave 2. Wave 4 also typically retraces less than 38.2% of wave 3 (a 38.2% retracement would have taken gold to 1452). So the current technical picture (abc correction and 3 days back above both 50 day MAs) along with all the current (and confident) bearishness gives us the perfect setup to launch wave 5.
            https://stockcharts.com/h-sc/ui?s=%24GOLD&p=D&yr=1&mn=3&dy=0&id=p42950678055&a=691904431

          • On October 6, 2019 at 3:19 pm,
            Excelsior says:

            Agreed Matthew. Wave 4 is more shallow, and Wave 5 is either similar to Wave 1 or .618 of Wave 3 which is the largest wave. Wave 3 was the move from May to late August and as Gary Wagner pointed out, it puts a .618 retracement around $1645 and Wave 1 extension from the low in Wave 4 (if that really was the low in Wave 4) would put it at $1646.

            The real question that will need to be answered as the next few weeks play out, is did Wave 4 put in it’s bottow on that spike down early last week, or does it still have further to go?

            Once that is known, then the price targets will be easier to define. For now I’m going with the $1645-46 level unless we see a lower low in Wave 4.

          • On October 6, 2019 at 3:20 pm,
            Excelsior says:

            I just reread that and meant a .618 extension of Wave 3, not a retracement.

          • On October 6, 2019 at 6:21 pm,
            Matthew says:

            For commodities, including gold, wave 5 is often larger than waves 1 and 3. It is also when the most speculative stuff performs best.

          • On October 7, 2019 at 12:51 am,
            Excelsior says:

            Looking forward to a nice extended Wave 5 then, which will surprise most investors to the upside.

            In the short term, it will be important to confirm the 4th leg is completed first, as I was prepared for a bit more of a pullback than we’ve seen in price and time, but a telltale sign of a bull is that corrective moves don’t get as deep or extended as most project. I believe Asian buyers will finally be off holiday this week, and will support PM pricing in the East.

          • On October 7, 2019 at 12:56 am,
            Excelsior says:

            Asia Gold-Slight retreat in prices adds to festive lure in India

            Oct 4, 2019 – Reuters

            Chinese holiday, local protests weigh on Hong Kong demand

            * Japanese sales tax hike deters gold buyers- trader

            * India discounts narrow, Singapore premiums little changed

            “A dip in prices earlier this week fuelled an uptick in physical gold demand in Singapore and India, with activity in the Indian market also gathering pace ahead of key festivals.”

            “However, overall activity was muted due to the golden week holiday in top bullion consumer China.”

            https://www.cnbc.com/2019/10/04/reuters-america-asia-gold-slight-retreat-in-prices-adds-to-festive-lure-in-india.html

          • On October 7, 2019 at 1:00 am,
            Excelsior says:

            Actually Golden Week in China isn’t completed until Monday, so maybe starting on Tuesday and the balance of the week we’ll see if more the buying returns to Eastern markets.

        • On October 5, 2019 at 11:28 am,
          Excelsior says:

          Is the Gold price still in good shape and how to stomach volatility – Rob McEwen offers insights

          Kitco News – Oct 2, 2019 #VIDEO w/ CEO of (MUX)

          https://www.youtube.com/watch?v=SoZbP3NUYTQ

    • On October 5, 2019 at 9:52 am,
      Excelsior says:

      GOLD vs. PAPER MONEY: Production Cost Is A Good Indicator Of Real Value

      September 25, 2019 – SRSrocco Report

      https://srsroccoreport.com/gold-vs-paper-money-production-cost-is-a-good-indicator-of-real-value/

      • On October 5, 2019 at 9:52 am,
        Excelsior says:

        IMPACT OF THE MARKET CRASH ON THE PRECIOUS METALS SECTOR…

        Clive Maund – September 29, 2019

        https://www.clivemaund.com/article.php?id=5161

      • On October 5, 2019 at 12:00 pm,
        Excelsior says:

        Why Central Banks Buy So Much Gold

        Bloomberg Markets and Finance – May 31, 2019 #VIDEO

        https://www.youtube.com/watch?v=c5UJ9wT8C8k

        https://youtu.be/c5UJ9wT8C8k?t=1

      • On October 5, 2019 at 12:01 pm,
        Excelsior says:

        Why Central Banks Buy So Much Gold

        Bloomberg Markets and Finance – May 31, 2019 #VIDEO

        https://youtu.be/c5UJ9wT8C8k?t=1

        • On October 6, 2019 at 4:16 am,
          Excelsior says:

          Here is a tiny toll milling operation in Peru following the central banks lead….. This is a true penny stock, but I’ve been watching their progress for the last 2 years and now have a small position in it, because these are the tiny nanocap stocks that can really run. Equinox spun out one of their processing centers to them last year, and now with the higher gold price, they are flirting with profitability by year end.

          “Inca One is a Canadian based mineral processing company. The Company’s activities consist of the production of gold and silver from the processing of purchased minerals located in Peru. Peru is the 6th largest producer of gold in the world and the Peruvian government estimates the small-scale mining sector accounts for a significant portion of all Peruvian gold production, estimated to be valued approximately US$3 billion annually. The Company purchases its minerals from government-registered, small-scale mining producers from various regions and processes it at its 100%-owned Chala One and 90%-owned Kori One milling facilities, located in Arequipa, Southern Peru.”

          ______________________________________________________

          Inca One Produces 1,987 Oz of Gold in August 2019

          @newsfile on 18 Sep 2019

          Edward Kelly, President and CEO, commented, “I am pleased to additionally report that consolidated gold production year to date is up over 60% with four more months for our team to continue to execute and deliver on this current performance.”

          https://ceo.ca/@newsfile/inca-one-produces-1987-oz-of-gold-in-august-2019

    • On October 5, 2019 at 10:01 am,
      Excelsior says:

      (NUAG) New Pacific Metals Corp. Announces C$15 Million Bought Deal Financing

      by @nasdaq on 2 Oct 2019

      “(SVM) Silvercorp Metals, Inc., a control person of the Company, has indicated its intent, by participating in the Offering, to maintain its pro rata interest of 28.93% of the outstanding Common Shares.”

      https://ceo.ca/@nasdaq/new-pacific-metals-corp-announces-c15-million-bought

    • On October 5, 2019 at 4:04 pm,
      Excelsior says:

      Mark Magarian: We are Extremely Early in this New Bull Market for Gold

      Palisade Radio – Oct 1, 2019 #AudioInterview

      https://www.youtube.com/watch?v=i0Rvj0nrb2Y

      • On October 5, 2019 at 7:32 pm,
        Excelsior says:

        Tocqueville Gold Strategy Third Quarter 2019 Investor Letter

        John Hathaway – October 4, 2019

        > Buy This Dip

        “Following a strong first eight months of the year, the precious-metals complex may be in the process of offering investors one final chance to enter on attractive terms before lurking systemic risks erupt into breakaway price action.”

        “Systemic risks have yet to trigger an appropriate market response, but those risks seem to be advancing from a simmer to a low boil. Question: What, where, and when is the tipping point? Answer: Timing is always devilishly complicated; still, warning signs and red flags proliferate. The debris field of mishaps, sudden policy shifts, dubious explanations, and ambiguous to bad economic data seems to expand daily. The bigger picture suggests to us that the established financial order may be on track for destinations unknown.”

        https://tocqueville.com/tocqueville-gold-strategy-third-quarter-2019-investor-letter/

    • On October 6, 2019 at 10:59 am,
      Excelsior says:

      (PGM) (LRTNF) Pure Gold Mining:

      Drilling Nearly Doubles Strike Extent of Wedge, Extends Madsen Red Lake Mine Gold System to Seven Kilometres

      by @nasdaq on 1 Oct 2019

      https://ceo.ca/@nasdaq/drilling-nearly-doubles-strike-extent-of-wedge-extends

      • On October 6, 2019 at 3:59 pm,
        Excelsior says:

        (NEE) (NHVCF) Northern Vertex to consolidate and extend Greenstone convertible debentures in order to deploy cashflow to mine optimization and exploration opportunities

        by @newswire on 3 Oct 2019

        Kenneth Berry, President and CEO, states: “We are pleased to have the opportunity to extend and consolidate the Greenstone convertible debenture facilities to take advantage of the Company’s cashflow, which will be put to work to create value for shareholders through the optimization of several projects currently underway at Moss. Northern Vertex will focus on initiatives that consist of exploration drilling, mine life expansion into Phase III of the Moss Mine, and several capital costs savings projects including the construction of a powerline to site, improvements to heap leach pad management, and the increase of recoveries at our Merrill Crowe Facility.”

        https://www.northernvertex.com/news-releases/2019/northern-vertex-to-consolidate-and-extend-greenstone-convertible-debentures-in-order-to-deploy-cashflow-to-mine-optimization/

        • On October 6, 2019 at 4:31 pm,
          Excelsior says:

          (NEE) (NHVCF) Northern Vertex Mining Corp. – Ken Berry, President & CEO

          Beavercreek Gold Forum – Sept 10-13th #CorporatePresentation #VIDEO

          https://www.gowebcasting.com/events/precious-metals-summit-conferences-llc/2019/09/11/northern-vertex-mining-corp/play/stream/28382

          • On October 6, 2019 at 4:44 pm,
            Excelsior says:

            (NEE) Northern Vertex is one of the better #Turn-Around stories out of small US-based Gold producers. Looking forward to seeing how their 3rd & 4th quarter numbers look, as I expect them to surprise the market expectations. Their production is now up, prices are up, and their mines are finally running as planned.

  5. On October 5, 2019 at 9:56 am,
    Matthew says:
  6. On October 5, 2019 at 10:05 am,
    Excelsior says:

    Lower For Longer #Copper Price Puts Squeeze On Marginal Miners

    Frik Els | October 3, 2019

    “Trade worries have dogged copper price bulls for the better part of a year, but more recently weak data from China, the US and Germany, together responsible for 70% the world’s consumption, have intensified the sell off.”

    “While there is near unanimous consensus that copper’s long term prospects are bright (particularly under a Greta Thunberg scenario), a lower for longer price is likely to cull the industry of marginal #producers – those in the 90th percentile of costs.”

    “BMO calculates at current prices, some 10% of copper mines around the globe are operating at a loss (while nickel extractors can’t believe their luck).”

    https://www.mining.com/copper-price-lower-for-longer-puts-squeeze-on-marginal-miners/

    • On October 5, 2019 at 10:08 am,
      Excelsior says:

      Despite investors trying to hang their bullish base metals hat on the Green Energy and Electric Vehicles trend, #Copper is still primarily tied to global growth, which has been hampered by trade wars, and a slowing global economy.

      The global malaise has also hampered #Zinc & #Lead. Supply is down some, but not enough to squeeze prices higher.

      It should be noted thought that there have been a few bright spots in the #BaseMetals like #Nickel and #Palladium. #Platinum is undervalued relative to Palladium and Gold, but slow auto sales aren’t helping the cause.

      Over time $EVs, #Batteries, Green Energy will create more demand, but it seems to be taking longer that most projections we saw a decade back compared to what has played out. Just food for thought, but eventually the base metals will return to favor (it isn’t likely in the near term though).

      if there was more of a global infastructure push (a way better use of taxpayer funds than endless wars and high priced politicians) then that could be a very constructive force in demand for #BaseMetals and the resource market in general.

      It would be great to see more roads, bridges, public works, commercial buildings, and housing that improves peoples lives be the drivers in the raw commodities on the global stage, and the markets will get there at one point.

  7. On October 5, 2019 at 4:34 pm,
    CFS says:

    JIM ROGERS DISCUSSES CHINA:

    https://www.youtube.com/watch?v=bC7-fVZJpLE

  8. On October 5, 2019 at 8:24 pm,
    johnnygeneric says:

    Chris Temple’s assertion that Trump is working hand in glove with the Deep State regarding his steadfastness in not giving in to China is COMPLETELY WRONG.
    Trump is trying to shrink the balance of trade we have with China. This is what he is doing. I can’t believe Chris doesn’t see this.

    The Deep State HATES TRUMP.

  9. On October 6, 2019 at 3:14 pm,
    CFS says:

    Could it be that Chris opposes anything that might reduce profits ?

    Trump is very short-term dangerous to himself and trade, but cutting out dangerous cancers is never easy.

    • On October 6, 2019 at 4:37 pm,
      Temple says:

      Dang…you guys have selective/simplistic memories regarding all the things I’ve said/written on China for many months.

      I respectfully suggest you read this weekend’s commentary I referred to, at https://nationalinvestor.com/2138/its-gut-check-time-over-china-and-for-trump/

      Other commentaries RE: China, trade, etc. there too.

      THEN I’ll be delighted to answer your questions and comments.

  10. On October 6, 2019 at 3:43 pm,
    Excelsior says:

    Scientists Invent World’s Strongest Silver

    Valentina Ruiz Leotaud | October 6, 2019

    “A team of US-based scientists came up with the strongest silver ever -42% stronger than the previous world record- after discovering a new mechanism that allowed them to strengthen metals while not losing any electrical conductivity.”

    “By mixing a trace amount of #copper into #silver, the team showed it can transform two types of inherent nanoscale defects into a powerful internal structure because impurities are directly attracted to these defects.”

    https://www.mining.com/scientists-invent-worlds-strongest-silver/

  11. On October 6, 2019 at 3:44 pm,
    Excelsior says:

    Arsonists attack Ecuagoldmining’s camp in Ecuador

    Valentina Ruiz Leotaud | October 6, 2019 #JurisdictionRisk

    “A campsite at the Río Blanco gold-silver project in southern Ecuador was set on fire this weekend by what operator Ecuagoldmining South America deems ‘terrorist attackers.’

    “According to the company, which is owned by Chinese investment firm Junefield Group S.A., the attackers took advantage of the surrounding chaos caused by a national strike action and forced their way into the camp carrying high-caliber guns. Once inside, they threatened security personnel and burnt a truck, tents and other items.”

    https://www.mining.com/arsonists-attack-ecuagoldminings-camp-in-ecuador/

  12. On October 6, 2019 at 10:21 pm,
    Ebolan says:

    “Just How Unstable Are The US Markets and US Economy?”

    Pretty unstable.

    Cory, can you interview this guy?

    https://www.youtube.com/watch?v=V7zEXiqiiqA

  13. On October 6, 2019 at 11:22 pm,
    Matthew says:

    I’m posting this one before listening to it because Gwen is obviously correct:

    Gwen Preston: The Fundamentals for Gold & Gold Stocks are Outstanding
    https://www.youtube.com/watch?v=M54bIQgkkXk