Thursday, July 24, 2014
Here's some more news, in case you care about several hundred tons of physical gold demand:
Daily News & Analysis - July rainfall helped agriculture to revive. The idea is that dooooom has been slightly averted, for now.
Eco-business - newly-found wind oscillation may keep El Nino at bay. For the amateur climatologists out there. Let's hope this means dooooom doesn't come.
Economic Times - late monsoon makes for hard choices. Quote:
Rafiquddin Mondol, a 45-year-old farmer from Polba-Dadpur block of Hooghly district, is a worried man. He may have to defer his 18-yearold daughter's marriage this November if it does pour in the next one week. "My paddy nursery is ready. But I cannot transplant the saplings as it has not rained and the fields are almost dry," he says.Indian weddings have something to do with gold, don't they?
Irrigating the land himself involves a cruel trade off. "It will double my cost of production, to Rs 40,000," he explains.
"I will not be able to marry off my daughter." Even if it rains now, Mondal says, his production -- and his income -- will be less than normal this year.
India buys the world's gold, and Indian farmers buy most of India's gold. So what's the monsoon been doing recently?
Reuters - monsoon revival keeps rain above average. Quote:
A month and half-long weak phase in the monsoon pushed rainfall a quarter below the average so far for the season that started in June. But a revival after mid-July pushed the rain level to above average last week.So that's an improvement. Though I don't know enough about Indian farming to be able to guess whether the crop is already doomed for this year no matter what rain is still to come.
Rainfall was 24 percent above average in the week ended July 23, the first week of surplus for this year's monsoon season.
Poor rain levels since the start of the June-September season raised concerns that India would face its first drought in five years, with coverage for most of the main summer crops slipping below the halfway mark.
Economic Times - late monsoon forces rural India to cut expenses. Quote:
In terms of discretionary spending, sectors that feel a ripple effect of a poor crop are two wheelers, white goods, cooking oil, gold and silver. Angshu Mallick, COO of Adani Wilmar, says rural buyers downtrade in hard times, from branded products to unbranded ones. "They will even switch over from soybean or mustard oil to palm oil as it is a cheaper alternative," he adds.Translation for dumbass Whitey: that's bad for gold. It's bad to the tune of up to 570 tons. But you go on and keep buying gold because inflation deflation Ukraine Israel dollar potato. I'm sure that'll work out well for you.
Gold and silver, a preferred asset class in rural India, will be among the worst hit.
India's annual gold demand is about 950 tonnes. "Rural India consumes 60%," says Haresh Soni, chairman, All India Gem & Jewellery Trade Federation. "If the crop production is not up to the mark, Diwali offtake in bullion will take a beating."
And no, Goldman Sachs didn't base their $1050 gold target on Indian rainfall modelling.
Surprise, surprise! Gold and silver are getting monkey-hammered today in the leadup to OpEx.
I was just saying to someone that I'm ignoring all the bottom-calling from the junior gold anal ysts, because they obviously have mistaken summer gold seasonality for the beginning of a new trend. This either takes ignorance or a conscious desire to mislead.
To the contrary, however, I'm also ignoring today's PM monkey-hammering because it's the leadup to OpEx, and the last time I ignored the hammer I managed to buy the juniors at the bottom and ride a very good month of winning.
Meanwhile, S&P is 8.7 points away from 2000. How bullish do you think the US equity market will get when 2000 breaks? Are you still listening to those clowns who called an imminent top in the S&P every week for the past 3 years?
GDXJ has lost the short-term EMA. Now it either falls to the -2SD line, or it falls to the SMA(50), or worse. Or not.
GLD is still above the SMA(50), but I wouldn't like to be there if it loses the SMA.
Although most of this is probably just due to OpEx on Friday, so I remain unconvinced.
Then again, if the monsoon is going to fail this year, say goodbye the gold buying season and strong seasonality. Cos that's what happened the last time the monsoon failed.
Then again then again, every June-Sep gold pop has included a good hard retrace right in the middle.
Here's some stuff:
Reformed Borker (Bork Bork Bork!) - 361 Capital weekly research briefing. I personally like the dropping correlations, because that is bullish for the market.
Gavyn Davies - another false alarm on inflation. He disagrees with Michael Shaoul.
Fiscal Times - it's easier to find skilled workers when you offer them a higher wage. By the way, the average income for a Chinese factory worker is $500 per month: how do you expect to find a skilled technologist in the USA when you're only paying 6 times that? Boy, it's going to suck for the Capitalist class when the globalization chickens come home to roost.
Reuters - as credit dries up, troubled Chinese steelmakers lose lifeline. Tangshan makes as much steel as the entire USA: I think that counts as overcapacity, don't you?
Mining.com - China's falling out of love with gold. Right in time for Friday OpEx? Did the market not notice this already?
BI - pro-Russia militant admits they shot down the airliner. Stick that in your pipe and smoke it, Shedlock you dumbass.
Tuesday, July 22, 2014
Here's Sir Richard Branson videoblogging about life on Necker Island, which he owns and rents out as a resort to the rich and beautiful.
Sir Richard, I like Virgin Records and all, and good work on the airline, and shipping condoms into Ireland was a nice touch, and reintroducing the scarlet ibis to the West Indies is a great idea, and thanks for giving a record contract to that insane bloody wackaloon Mike Oldfield.
Nevertheless, despite how much I appreciate you for all you've done for the world, when I watch this video I just... I dunno, I just want to punch you in the cock. With a meat tenderizer. Repeatedly.
Especially when I see you frolicking in the pool with Bishop Desmond Tutu.
Here he talks more about his island, and how he recently bought another one just a little bit down the way:
And here's an interview where he talks about all the money he's lost on his investments:
The Guardian - Richard Branson pledges to turn Caribbean green.
Bloomberg Surveillance - interview with Liz Ann Sonders (mp3).
Where she probably says something along the lines of "Barry and Josh should quit being pantywaist sissies, stop their goddamn whining and just buy the damn SPY."
Prepare to be confused. Here are four charts:
Yo Mama Gold's chart looks like it's basing real nice, hasn't broken down, still above RSI=50, still a lot of possible upside on the chart compared to other miners.
But here's where it gets weird:
B2 is rolling over.
OK sure, B2 is diluting its shareholders. But it's buying upside in doing so. It certainly would be nice if they stopped buying other mines and actually spent time doing all that production growth that they keep promising, but they are building a high-production low-cost gold miner, and that's the type of company you'd think Wall Street Whitey would buy if they wanted to go long gold.
The problem here is B2's chart looks weak, and a loss of the SMA(50) will make Baby Jesus cry. Why does B2's chart look bad if Asanko's looks good? Is the performance divergence the result of people becoming pissed off with B2's growth strategy? Would people now prefer to own a buyout target than a buyer-outer?
Rio doesn't look as strong as Asanko. Yes, the past few days' action can be a basing before a next leg up; but it could also be a long topping pattern.
Maybe the confusion across charts is just something I should expect, considering the Lizard People have been slamming gold in the runup to this week's OpEx. Silver has held up well by comparison, and is still a tell on the underlying PM market. So maybe I can afford to wait til Friday or Monday before taking any long positions.
Then again, gold doesn't exhibit positive seasonality in years with a monsoon failure. Which we're seeing this year.
Then again then again, maybe whitey takes over from India on the gold demand side, with his expectations of US inflation and/or European deflation and/or god knows what the hell these idiots in Wall Street believe.
What to do? I'll wait for now.
I am incommunicado all tomorrow, so there's your fair warning.
But as long as it's still today, here's some genuine factual information for you to consider, instead of the ignorant speculation and uneducated blather that you get from the rest of the blogosphere:
Liz Ann Sonders - market update. Everything is still fine, but it's good to have her around to 'splain it to us.
BI - June CPI. No surprise.
Bespoke - gasoline prices going down. In the summer, even! Looks like US consumers are going to get a boost.
Reformed Borker (Bork Bork Bork!) - the SPY:IWM divergence. As you'll remember, I identified this in the past week. Josh takes the divergence as a sign of a market top, while I take it as a sign that IWM is due to outperform to get back up to the longterm trend. The market top whining just gives me even more confidence that I'm right. And look at today's action, Josh! You might just have bottom-ticked the IWM! I guess that's why Barack Obama reads my blog and not yours.
FT beyond brics - the free ride for EMs is over. Yabut, they don't simply have to improve productivity; they have to do it in the market context of increasing interest rates and reduced investment capital.
Reuters - depleting reservoirs need rains to prevent crop loss. Things are starting to look bad in India, the country that buys all the gold.
Mineweb - metal ETFs lure investors at fastest pace since '09. I guess the market has decided that we're not at the end of a commodity cycle after all?
Monday, July 21, 2014
Here's some noontime reading for those watching the noncommittal market:
Bloomberg - bubble paranoia setting in. Because the market's not supposed to go up with a black man in charge, or something.
Reuters - late monsoon starts farmer's journey to hell. With the caveat that gold doesn't really care that much what happens in Uttar Pradesh. Kudos though to Nameet Panwar, who has enough brains to switch to a higher-yielding crop.
Sunday, July 20, 2014
IKN - Mike Shedlock is a fucktard. Where he says:
He's been going tinfoil for quite a while, but today's post in which he tries to pass off a one month old Youtube as a video of the shooting down of MH17, along with conjecture that the plane (which is obviously not MH17) was under control as it dived, is nauseating.Yes, and in particular I'd like to go one further than Otto, who merely notes the date, and point out the video is of the fucking Antonov that the Russians shot down back in June.
You can tell by the fucking video title, "Под Славянском сбили АН-30".
So I actually went over and read his crazy-ass article, and I can explain why Mish wrote this crap.
He did it so he could get a repost on Zerohedge. It fits perfectly.
But what I find funnier is this article that Mish links to:
Newsmax - Ron Paul says "don't blame Putin for MH-17".
I find it hilarious because the great White hope of the Republican Party, Ron Paul, has now essentially come out as yet another Republican stooge for Vladimir Putin:
The former Republican presidential candidate says that the United States shares responsibility for the conflict between Russia and Ukraine.I guess that's what happens when you're a goldbug. You start watching Russia Today, and before you know it you've been won over to the side of the Russians.Next thing we know Paul will reject libertarianism in favour of locking gays up in jail and forcing mandatory membership in church.
"It's pretty evident that the whole problem in Ukraine started approximately a year ago when the Europeans, along with the United States, overthrew an elected government and overthrew [former Ukrainian President Viktor] Yanukovych — insisting that there'd be civil strife over there," he explained.
The United States instituted sanctions against Russia Tuesday aimed at Russia's financial institutions and defense sector, which Paul considers "acts of war."
And what proves Ron Paul is completely out to lunch?
"Under these circumstances, it's very difficult to get the real information so everybody's angling to propagandize and make their position known," he said.Really, grampa? I guess you didn't hear that the Russian-backed rebels bragged that they did it:
"It'd be unwise to say, well, the Russians did it, or the Ukrainian government did it, or the rebels did it."
This is what happens when you let propaganda on the airwaves, idiots into the blogosphere, and clueless fantasyland goldbugs into politics.
Two weekend reads for you:
New Deal Demoncrat - weekly economic indicators. Everything still looks good in the US.
Mining.com - fewer disscoveries, slower development weigh on gold industry. With the caveat, of course, that this doesn't include a damn thing happening in China.