Goldman Sucks: Feb 3, 2012

03 February 2012

Greece PSI still nowhere in sight/SLV short 26million oz/China heading for hard landing/ MFGLobal on the missing funds/

Thursday, February 2, 2012

Good evening Ladies and Gentlemen:

Gold finished higher by $11.40 to $1758.50. At first, gold had been repelled from the banker's strong resistance $1750 line in the sand early in the European session. However it then recovered to pierce this resistance and finish well above the resistance to close at its high. The fact that gold did this prior to the jobs report is definitely an extremely bullish sign. Silver finished higher by 43 cents to $34.15. Tomorrow is the jobs report and as always the bankers monkey around with the gold and silver metal prior to its release. Expect a big revision from the adjustments to the B/D model which occur in the January month and announced always on the first Friday of February. Let us head over to the comex and assess trading, inventory movements and amounts of metal standing.

The total gold comex OI rose by 4961 contracts to finish the comex session at 430,094 from 425,133.
The front delivery month for gold saw its OI fall from 3458 to 1783 for a loss of 1675 contracts. Since we lost 1036 contracts through delivery notices we lost another 639 notices or 63900 oz to cash settlements.
Blythe must have been very busy today. The next big delivery month is April and here the OI rose to 237,961 from 231,072. The estimated volume at the gold comex today was 145,684. The confirmed volume yesterday registered 132,408 which are both very weak volume numbers.

The total silver comex OI rose by 174 contracts. The front options expiry month of February saw its OI rise from 141 to 191 for a gain of 50 contracts even though there was no delivery notices yesterday. Thus we gained additional silver ounces standing and lost nothing to cash settlements. Generally this is a sign that London England has run out of silver metal. We are now approaching the next delivery month of March which is less than 4 weeks away and here the OI fell from 47,300 contracts to exactly 46,000 contracts for a loss of 1,300 contracts. No doubt that some rolled over from March to May. The estimated volume at the silver comex was 58,718 contracts and the confirmed volume yesterday was 51,265. The volume here has been rising and this may be due to the high frequency day traders who are jumping on the bandwagon thinking that silver is in play due to lack of metal from London. They are day traders and you see from the OI numbers that they exit their positions at the end of the day.

I Can’t Take It Anymore! When Will The Government Quit Putting Out Fraudulent Employment Statistics?

On Friday, the entire financial world celebrated when it was announced that the unemployment rate in the United States had fallen to 8.3 percent. That is the lowest it has been since February 2009, and it came as an unexpected surprise for financial markets that are hungry for some good news. According to the Bureau of Labor Statistics, nonfarm payrolls jumped by 243,000 during the month of January. You can read the full employment report right here. Based on this news, pundits all over the world were declaring that the U.S. economy is back. Stocks continued to rise on Friday and the Dow is hovering near a 4 year high. So does this mean that our economic problems are over? Of course not. A closer look at the numbers reveals just how fraudulent these employment statistics really are. Between December 2011 and January 2012, the number of Americans "not in the labor force" increased by a whopping 1.2 million. That was the largest increase ever in that category for a single month. That is how the federal government is getting the unemployment rate to go down. The government is simply pretending that huge numbers of unemployed Americans don't want to be part of the labor force anymore. As you will see below, the employment situation in America is not improving. Yet everyone in the mainstream media is dancing around as if the economic crisis has been cancelled. I can't take it anymore! It is beyond ridiculous that so many intelligent people continue to buy in to such fraudulent numbers.
The truth is that the labor force participation rate declined dramatically in January. For those unfamiliar with this statistic, the labor force participation rate is the percentage of working age Americans that are either employed or that are unemployed and considered to be looking for a job.

NYTimes patronizes gold, whitewashes fiat, overlooks the big questions

Submitted by cpowell on Fri, 2012-02-03 02:29. Section: Daily Dispatches
In a Focus On Gold, History Repeats Itself
By Floyd Norris
The New York Times
Thursday, February 2, 2012
http://www.nytimes.com/2012/02/03/business/in-rise-of-gold-bugs-history-...
As it was in 1980, could it be again in 2012?
The 1980 presidential election was fought by a Democratic incumbent weakened by a poor economy amid worries that the United States had lost its ability to compete in the world. Gold prices had risen to unprecedented levels as the election approached, and the Republican nominee hinted he might propose a return to a gold standard.
That Republican, Ronald Reagan, won the election and soon appointed a commission to study the role of gold in monetary systems. To gold bugs, it appeared to be the best chance in decades to move the country toward gold and away from what they like to call "fiat money," a currency anchored by nothing more than government dictates.
Last month, Newt Gingrich, seeking to widen his support in the days leading up to the South Carolina primary, promised that he would appoint a new gold commission. "Part of our approach ought to be to re-establish something Ronald Reagan did in 1981 and that is to have a commission on gold to look at the whole concept of how do we get back to hard money," he said in a speech.

China's gold output and demand could be far greater than ‘official' data suggest

Comment from Jeff Nichols suggests that Chinese gold production and consumption may be considerably higher than the statistics released by the country would indicate.

Author: Lawrence Williams
Posted: Thursday , 02 Feb 2012

LONDON -
Following the recent Mineweb article on Chinese gold production and consumption (see China enhances position as world No. 1 gold producer - but where's it all going?) we have received the following comment s from specialist precious metals analyst, Jeff Nichols of American Precious Metals Advisors and Rosland Capital, which suggests that both Chinese gold production and consumption may be considerably higher than that suggested by official and semi-official statistics coming out of the Asian giant.
Nichols avers that China's domestic gold mine output is, without a doubt, much higher than reported. Actual gold mine output could easily be close to 400 tons and possibly more for the following reasons:

The China Gold Association (CGA) numbers reflect production by their members only -- but omit gold mined by non-members. These include many small, unofficial mining operations some of which are illegal existing in the "underground economy". The CGA data also excludes production from mines owned and operated by the military, which is significant according to sources. Not to be overlooked is by-product output from copper, silver, and other metal mining activity. Again, this is significant though hard to know just how significant.

Israel: Iran's nuclear arms program is complete, its missiles can reach US

DEBKAfile Special Report February 2, 2012, 3:21 PM (GMT+02:00)

IDF

Military Intelligence Chief Maj. Gen. Aviv Kochavi

Iran has completed the development of a nuclear weapon and awaits nothing more than a sign from Supreme Leader Ayatollah Ali Khamenei to start assembling its first nuclear bomb, said Israeli Military Intelligence Chief Major General Aviv Kochavi on Thursday, February 2. Assembling a bomb would take up to a year, Kochavi estimated. With 100 kilograms of uranium enriched to 20 percent grade and another 4 tons of uranium enriched to 3.5 percent already in stock, Iran would need another two years to make four nuclear bombs.
Therefore, by the end of 2012 or early 2013 Iran may have a single nuclear bomb, but by 2015 the figure would jump to four or five.
The officer was essentially amplifying the words of his predecessor, Maj. Gen. (res.) Amos Yadlin, who said on Jan. 26 that as long ago as 2007 or 2008, Iran had already passed the point of no return in developing nuclear weapons. Kochavi agreed with him that none of the sanctions imposed thus far had persuaded Iran to slow down, least of all shut down, its drive for a nuclear weapon.
His comments coincided with the findings published Thursday by the Enterprise Institute, an American think tank, that Iran would be able to manufacture a 15-kiloton nuclear bomb as soon as August of this year, just seven months from now.

Kyle Bass is “Against Selling” any of UT’s Gold

By jturbin

February 3, 2012 11:02 AM EST

Last year the University of Texas Investment Management Co. took delivery of over more than 6,000 gold bars – worth nearly $1 billion at the time – based in part on advice from noted hedge fund manager Kyle Bass.

Yesterday, Mr. Bass stated at a meeting among the endowment’s fund directors that he is “against selling any of the gold,” according to a Bloomberg report. Bass cited “the need for a hedge against mounting risks driven by government deficits in the U.S. and Europe,” the report noted.

Bloomberg went on to say that “The $19.1 billion in endowment funds overseen by the University of Texas Investment Management Co., or Utimco, lost almost 3.8 percent on invested assets in the four months through December, preliminary figures distributed today show.” The report did not specify which positions contributed most to the fund’s decline, but with gold falling from $1,825 to $1,564 from September 1 – December 31, the yellow metal undoubtedly played a role.

Jim Rogers on Ben Bernanke, the Dollar and "Saving the Saver"

States seek currencies made of silver and gold

By Blake Ellis @CNNMoney February 3, 2012: 10:53 AM ET

Worried that the Federal Reserve and the U.S. dollar are on the brink of collapse, more than a dozen states have proposed using their own alternative currencies of silver and gold.
NEW YORK (CNNMoney) -- A growing number of states are seeking shiny new currencies made of silver and gold.

Worried that the Federal Reserve and the U.S. dollar are on the brink of collapse, lawmakers from 13 states, including Minnesota, Tennessee, Iowa, South Carolina and Georgia, are seeking approval from their state governments to either issue their own alternative currency or explore it as an option. Just three years ago, only three states had similar proposals in place.

"In the event of hyperinflation, depression, or other economic calamity related to the breakdown of the Federal Reserve System ... the State's governmental finances and private economy will be thrown into chaos," said North Carolina Republican Representative Glen Bradley in a currency bill he introduced last year.

Unlike individual communities, which are allowed to create their own currency -- as long as it is easily distinguishable from U.S. dollars -- the Constitution bans states from printing their own paper money or issuing their own currency. But it allows the states to make "gold and silver Coin a Tender in Payment of Debts."

To the state legislators who are proposing state-issued currencies, that means gold and silver are fair game, said Edwin Vieira, an alternative currency proponent and attorney specializing in Constitutional law. And since gold has grown exponentially more valuable, while the U.S. dollar continues to lose ground, the notion has become increasingly appealing to state lawmakers, he said.

The state gold rush: Utah became the first state to introduce its own alternative currency when Governor Gary Herbert signed a bill into law last March that recognized gold and silver coins issued by the U.S. Mint as an acceptable form of payment. Under the law, the coins -- which include American Gold and Silver Eagles -- are treated the same as U.S. dollars for tax purposes, eliminating capital gains taxes.

Silver And The Shift To Measuring Wealth In Ounces Instead Of Dollars

China gold demand soars to 891 tonnes, India's 868 tonnes in 2011: RSBL

By Sreekumar Raghavan
MUMBAI (Commodity Online): India, traditionally , the largest consumer of gold, witnessed a significant drop in demand and consumption in 2011 but China, the largest producer of the yellow metal, witnessed a stunning surge in demand.

The reason for the spike in Chinese imports in recent months, traders say, is that throughout the supply chain the Chinese Gold industry was aggressively building inventory ahead of Lunar New Year, after experience in 2011 when the country ran short, according to an assessment by Mr Prithviraj Kothari, Director, Riddi Siddhi Bullions Ltd (RSBL).

In an interview to Commodity Online, Mr Kothari said that the effect of building of up China gold inventory was stunning. “The 189 tonnes of imports in October and November compares with total imports for the whole of 2009 of just 45 tonnes.”

Silver gains 20% in January 2012; is it a beginning?

By Debbie Carlson
Commodities put in a strong January performance, but few markets earned as much as silver did in the first month of 2012, gaining 20% during the period. That put silver in second place for the strongest commodity futures markets, beaten only by orange juice.

As February dawns, Silver continues to build on its gains, but it is hitting some resistance as it targets the $34 an ounce level. On Wednesday, March silver futures on the Comex division of the New York Mercantile Exchange settled at $33.837 an ounce.

Silver has been on a solid uptrend since hitting a low of Dec. 29 of $26.1450 for the March contract.

Adrian Day, president, Adrian Day Asset Management, said much of the reason why silver rallied so much in January was because it had fallen so much during December. On Nov. 30 March silver settled at $32.804 and on Dec. 30 it closed at $27.915, a 15% swoon in one month alone. Silver wasn’t alone in its December descent, many other markets including Gold and other commodities tanked in December. Likewise, many commodities rose last month.

Day said silver’s trip under $30 may have enticed bargain hunters who were able to pick up the metal at prices not seen since late September.

'Next target for Gold at $ 1,800/oz, for Silver at $37/oz'

By Richard Russell

Last Updated : 03 February 2012 at 20:50 IST

The great GOP debate continues with Gingrich finally dropping behind the Mitt.

Meanwhile, the stock market is caught in the puzzle of will Europe emerge whole from its current troubles, or will the Eurozone fall apart like a deflating balloon? That plus the following question: Does the US face another four years of a socialist president who seeks to solve all problems by either taxing "the rich" or throwing trillions of man-made dollars at the screw-up in question?

The poor man in the street is facing questions and doubts. Will he be at the same job a year from now? And if he gets a pink slip will he be able to find another job?

If the year 2012 has a title, the title should be "uncertainty."

Nobody's asking, "What happens if there's a recession in the next year?" Or "What if unemployment is 9% or more at presidential election time?" If either of the above occur, the GOP could run a donkey, and it would be our next president. Obama must have a good economy to win.

The effect of FOMC statement on precious metals

By Dr Jeffrey Lewis

Last Updated : 03 February 2012 at 21:00 IST

Among the recent price consolidation, it should not be forgotten that the U.S. Federal Open Market Committee of the Federal Reserve Board decided to leave rates at 0.0% to 0.25% until at least late 2014, according to the FOMC statement released on January 25th.
In their statement, “the Committee decided today to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that economic conditions--including low rates of resource utilization and a subdued outlook for inflation over the medium run--are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014.”

In addition, the Fed indicated on January 25th that it would release the projected direction of interest rates by its seventeen members and would take the historic move of setting an inflation target of two percent. Nevertheless, putting off the first possible adjustment to rates until late 2014 somewhat eclipsed the Fed’s apparent intention of increasing transparency, while at the same time sending further signals for diversifying out of paper.

Bernanke reassures market that the Fed has options
In the press conference following the FOMC statement, Fed Chair Ben Bernanke clarified that the decision to leave interest rates unchanged for over three years was not cast in stone. He noted that the bank’s capacity to forecast out that far was limited, but that the Fed could adjust rates depending upon economic conditions.

Goldman Sucks

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