Friday, February 22, 2013

End of week news


Got up late, was busy at work all day, and due to the germ-infested nature of the lowlives I work with I now have a nasty cold coming on.

What's worse, I was almost out of vodka and have used up all my Jagermeister, so I had to restock.

Not that you lot are deserving of any apology. Fuck you, I got my own life to live. Offer to pay me to write this blog for fuck's sake.

Anyway, here's the news:

JC Parets - consensus is a shallow pullback. And that concerns him, because he thinks the market will dod something contrary to everyone's expectation.

Bonddad - is a bigger selloff in the cards? Dude, sounds to me like the consensus among the blogger crowd is a bunch of piss-stained worrying.

Calculated Risk - mortgage delinquencies still going down. Oh and also, conventional home sales up sharply. It's a long deleveraging, but progress is constant. Don't believe the doomers.

Calculated Risk - a brief comment on lumber prices. Apparently some clown with a blog at ibankcoin is scared of the lumber chart. Bill McBride shows the longer-term chart looks fine, and also notes you might expect little bursts of new supply to come back online as long-shuttered sawmills restart.

Bloomberg - China's leading index rises at a faster pace. As far as I'm concerned, the only thing I'm worried about in China is a banking collapse; the only think I'm looking forward to is a return to China hopes generating commodity inflation.

WSJ China Realtime - on productivity overcoming demographics. Some decent points made on how we needn't so much worry about China's demographic rollover - there are other places China can improve productivity to keep their GDP growth up. And I'm sure the Chinese ruling officials know all of this - after all, they want to stay in power.

Beyond Brics - China house prices up, stocks down. Bill Bishop notes that there will definitely be some real estate crashes in China, but mostly in C- and D-list cities. China's fragmented, not at all a uniform economy - exactly like how IKN paints Peru, but larger. Still, if the Chinese government does put muscle against recent real estate appreciation, where will the corrupt cadres decide to put their savings? Maybe some sort of easily-portable metal with no paper trail? Hm?

Bonddad - Europe's growth problems continue. If the only good news is the projections, then what if we see the projections fail? Maybe we're just supposed to wait for Merkel, to see if she'd rather commit political suicide than stimulate the European economy.

Mining.com - the great mining CEO purge. "Purge", you say? Ah, if only we could be like the Soviets, and march them out to a nice camp in the Chukchi Okrug for ten years of hard labour in minus-70 temperatures.

Jojo - the time to buy is now!!!!1! Well, if you're going to believe the charts, then the charts are good; $HUI at long-term trendline support, gold and silver at 2-year support, lowest public opinion on gold in 10 years, and Rydex PM fund suffering a 50% drawdown. Either the market is right and gold is done for, or the market is near a bottom.

Mining.com - Some guy from Commerzbank says gold should go back up to $2000. At least he's not some dumbass on ZeroHedge. And, as the ditz interviewer says, "why should people put money into gold when there are so many better places" - ah-ha! Is that a clue as to what made gold go down?

Talking Biznews - CNBC buys Nightly Business Report. They're getting rid of that new kid, Tom something; but I really wish they could bring back Paul Kangas:



He always made the show enjoyable.

Friday Videos - Einstürzende Neubauten bum you right the fuck out for the week after Valentine's Day

Here's Einstürzende Neubauten bumming you right the fuck out.


Thursday, February 21, 2013

How's that Rye Patch Gold position doing now?


So how's Rye Patch doing?


Awesome! Down a further 30% in just a week, on heavy volume!

I guess their bullshit claim on an operating mine really isn't worth anything. Because if it was, you'd have to think the stock would be worth something. As it is, they're down by two-thirds since staking the Rochester mine. Brilliant move, guys! You analysts too - winning pick, this!

Evening newsbits


Beyond Brics - India seeks to block tax-dodging on Thai gold imports. With this quote: "But jewellery consumers are not at all price-sensitive. Any impact is on the quantity demanded but they spend the same amount of money."

Mining.com - Yamana doesn't suck. But they're still only one in a large group of generally-sucking miners.

BI - The poor are getting slammed by tax hikes while the rich spend with wild abandon. New Deal Democrat thinks the payroll tax cut is killing the consumer, thus the poor numbers at Walmart that contradict spending surveys; meanwhile the rich are spending like crazy cos they got their gigantic bonuses early, in advance of Obama's supposed tax hike on the rich. Oh well; history tells us it'll ever be so, until we start murdering the rich.

Related to that,

FT Alphaville - tax avoidance: it's close to home. Miami is where the Latin American crooks go to launder their wealth, Delaware is where you incorporate to keep your company secret, and even those fascist neoliberal scum U2 relocated their band to the Netherlands to avoid paying taxes on royalties. Again, history proves it'll ever be so until we murder a few thousand rich people.

BI - Obama to give amnesty to 11 million undocumented immigrants. Good. Americans need more hard-working people and fewer fat white trash.

And for comedy/tragedy,

Mining.com - Peter Schiff says the gold bull market is far from dead. Here's a quote that sums up the level of his complete ignorance:

“People who are saying there is no reason to buy gold now, never understood the reason people were buying it in the first place. People weren’t buying gold because they were worried about a crisis in the Eurozone or weak US stocks. People were buying gold because central banks were printing too much money. It’s inflation that drives the gold train, not political uncertainty.”

No, Peter, you ignorant fucking useless cunt. People were buying gold because their daughter Parvinder was marrying a nice boy named Sandeep, or because they wanted to hide the money they had stolen from their government, or maybe even because they are a central banker diversifying out of US dollars and Euros.

You, Peter Schiff, have obviously never even picked up the World Gold Council's report, and have never bothered to educate yourself about where gold is bought. Therefore the media should tell you to fuck off back to your Tea Party pump and dump newsletter with the rest of the goldbugs.

Speaking of which,

BI - some ultra-bullish gold price targets. Some crazier targets are derived by extending the Bretton-Woods peg formula through today - which again begs the question, why? Why is this valid? Why the fuck is the United States important at all to the price of gold? Is it because gold is the only true currency under the law of Jesus, and Jesus is an American? Is that it? I wish the Americans would all please just fucking shut up about their supposedly being the only fucking country in the world.

Oceana Gold might want to stop vomiting

Someone tell Oceana Gold that the market's done crashing.


I started a position yesterday at $2.30.

Today I saw it wasn't going anywhere, and there was still major distribution going on, so I dumped back into the market for a $40 loss.

There's better places to put my money, and I'll be happy to buy back OGC when it stops sucking.

OK already, here's your $BPGDM


1. You know it might be a good day to pile back in the miners when the $BPGDM has fallen all the way down to this:


2. I like running statcounter on my blog, cos it's telling me that bloody well everyone is looking for the $BPGDM data for today.

3. Heck, one guy even hit my blog today with the search term "Jim Rogers pile of money in the corner".

So I'm going to call the bottom here.

Meanwhile, in the base metals....


Mickey Fulp is constructive on palladium from a supply-demand standpoint. Apparently (going on memory here) he thinks Russia will begin hoarding, South Africa's a clusterfuck, and nobody else mines any significant amount. So was today a good buy point? Why wouldn't you buy the dip on an advance, especially with the supporting SMA right there for a good sell stop?



Coal seems to have dropped as  result of... what, Fed minutes? US doesn't use coal though - I know this cos we haven't had that Ohio-made chewable smog in southern Ontario for years now.

But China does use coal. This must be a China concern... maybe fear that they'll start cracking down on air pollution?




But copper's been diving for 3 days now. Not good.



Nickel, to the extent this thinly-traded ETF means anything, is also dropping hard.



Is there some sort of emerging markets concern? Maybe cos of the Fed minutes? Almost looks like a good time to go short.



Vale's dropping hard too.

I dunno, have we suddenly become concerned about world growth? What's the new data?

New TA invented just now


I was looking at the USD chart and saw an interesting technical formation:


I call it "the balls and penis".

It's a very tiny penis right now, but I expect it to grow over time.


BREAKING NEWS

BREAKING NEWS

PMs and miners discover a new direction, tentatively called "up".

Details as they become available.

morning news


Bloomberg - commodities fell with speculation a hedge fund was selling. No wait, it's because of concerns about China's threat to curb construction, which is untrue as Bill Bishop notes (see below). No wait, it's actually because of the Fed minutes, which must be untrue because the softs are okay. Quote from a Stifel Nicoalus guy: "There’s market chatter that a fund is blowing up". Good, I say.

Caijing - China is building a fuckton of affordable housing. Which uses about as much steel and copper as luxury condos. And as Bill Bishop noted, the "curb homebuying" thing was an exhortation from outgoing premier Wen, so it's stupid to read too much into it.

Bonddad - India's growth problems in detail. He's not an India expert - for that you should go to Kiron Sarkar - and he over-complicates things. Basically, India is and has always been an incompetent economy. Big deal.

Ritholtz - when even he weighs in about the death cross in a commodity he never buys, it's important. Death cross is a good "get out" signal in markets that are prone to major crashes - it reduces portfolio drawdowns, and gives you an opportunity (if you don't bother waiting for a golden cross) to get in at a much lower price (think S&P 500 in 2008). But as far as I'm concerned, you can use any arbitrary SMA (and why not EMA?) numbers for your "death cross", in which case the gold death cross has been happening for a while and will continue to happen. I don't get why people have such a fucking hard-on for SMA(50) and SMA(200).

FT Alphaville - Izzy on that clever George Soros. In part one, Isabella Kaminska points out that Soros used his buy announcement to create a good sell point. Quote:

[...] this whole thing about Soros selling GLD is making us sigh a bit. Headlines like “Soros dumps gold as prices sink” are not only misleading but missing the point entirely. What’s even more frustrating is that most of the time the Soros stories refer directly to the issue at hand: the sales date back to the fourth quarter of 2012.

These disclosures thus must not be taken at face value. This is, if anything, expert exploitation of the hedge fund disclosure system, based on the expectation that the filings themselves cause people to react stupidly too late rather than too soon.

Anyone who has access to a data terminal, however, can tell you what’s really going on. Soros Fund Management has been using GLD as a market mis-signalling vehicle.

Later on, though, she goes into a "what happens to gold now?" rumination, which would frighten you if you take it at face value; but in reality, what she says can simply be distilled down to "if gold isn't going up any more, it'll go down", which you know already, and which shouldn't faze you since you can go to my fucking reading list, over there on the right of the webpage, and read all about the supply constraints for gold.

ETFDB - "FLAG", the forensic accounting ETF. Interesting. If you want to buy a core position in S&P, why buy SPY? Or why even buy RSP, the equal-weight ETF? This FLAG ETF takes the S&P 500, and uses forensic accounting to cut out all the companies that should act as a drag on a market-tracking ETF. Clever idea! Also, apparently they weight to earnings quality, which isn't exactly equal-weight (and I like equal-weight) but it's close. The proof will be in the pudding of course, but I really like the idea of this ETF.

Bonddad - is the market rally dead? Also, BRICs looking weak.Should I buy HJD, the EM double-short ETF? Or is this just a hiccup? What's changed?

About that whole "8:20 Comex takedown" thing


So ZH has been running a bunch of articles on the regular gold (and silver if you really care about that) morning takedowns in New York.

Here's one - the precious metals slam is right on schedule.

Here's one with more charts - silver's four-hour slamdown window.

The most illustrative post is this one by Chris Martenson - he's so pissed off that he's been saving every Kitco chart page at midnight for weeks.

And it is truly funny that gold gets cratered in the week of OpEx, when China's on vacation. The follow through this week might just be a few major funds getting crucified. The newsflow obviously gets highly negative, because of course that sells clickthroughs.

Anyway, so the general argument from the ZH crowd is that it's those dastardly Joos, Lizard People, and (of course) JP Morgan to blame for what seems like a purposeful takedown of gold. And yeah, when you read Martenson's article, he does seem convincing (me not knowing anything about how people trade on the Comex) with his accusation that gold is being driven down before open outcry, on massive volumes, in an attempt to sabotage the price.

But here's the thing.

Why can't the conspiracy theorists blame China for driving down the price?

I mean, if their central bank really does want to buy gold, why should they do it in a way that's supportive of the goldbugs? I mean yes, okay, goldbugs hate America, enjoy allying themselves with Russia and Iran, and also glorify the Communist absolutist state-controlled economy of China. But other than that, it seems to be unreasonable to assume China would never want to drive gold down below $1500 so they can load up their truck as the goldbugs puke.

Basically, why should you expect China to be supportive of a high gold price if they're accumulating?

Wednesday, February 20, 2013

A person's comment


Someone commented:

Soros isn't the only one selling ETFs:

Cinthia Murphy on Seeking Alpha today:
"The $67.5 billion GLD and the $8.7 billion IAU were each trading about 1.5% lower early in the session, extending losses that now have cost each of the funds roughly 5% of value in the past five days alone.
What's more, GLD's price action has come accompanied by net outflows of $362 million, while IAU has lost some $146 million in the same one-week period."

That's half a billion of gold sales in just one week from two ETFs. You need a lot of Chinese and Indians to compensate for that.

First, what the fuck has Sucking Alpha got to do with anything? What the fuck? Is CNBC off air today? Was ZeroHedge down while you were surfing the net for news?

Secondly,

No you don't. You don't need "a lot of Indians". Half a billion dollars in gold is less than one week's worth of Indian gold demand.

Next time, before making such a statement, please open up the most recent WGC report to look up Indian gold demand, and then do a bit of math in Excel.

Because you can be fucking sure that Seeking Alpha don't fucking bother.

PS interestingly, India would be able to consume the entirety of GLD's holdings in a little over 3 years, just to make jewelry.

Assuming GLD's "gold" exists, of course: when you ponder the size of India's gold consumption relative to GLD you really have to wonder if the goldbug wackaloons aren't too far off base, and there really isn't any "gold" in that ETF to begin with.

So what is it we're looking at here?


Blah blah gold and silver collapsing.

With that out of the way, here's some other charts:


So... steelpocalypse?




The great copper collapse?





The end of aluminium?



Um... I don't get this.

Seriously. Is this a global economic armageddon we're facing?

Or just some commodity fund blowing up?

And why aren't the "news" "sites" blathering on about the coming collapse in base metals? Last I checked the news media had a bullish outlook on base.


A bit of thinking

So I was watching the ever-beautiful Daniela Cambone interviewing the significantly less beautiful John Doody:



And he makes the point that Soros didn't sell all his GLD. And what he did sell, he sold to free up money to short Yen, which made sense.

Then I went over to Buttonwood and again saw mention of George Soros.

That led me to this CNN article that notes:

Soros sold only about half his GLD in Q4 2012.

Now, he also puked all of his Kinross:


And on the one hand that was a smart move cos he just sidestepped a 25% loss. Which I think is the type of loss Soros wouldn't like to experience.

But on the other hand, if George Soros is such a genius why would he own a shitty miner like Kinross? I mean... I'm shaking my head here, he could buy B2Gold or Rio Alto. Or even Yamana if those two are too "little" for "him".

And also, as of end Q4 he still owns Freeport McMoran:


Which hasn't been doing that well either.

So I think we can put to sleep that silly Soros meme, along with the even sillier "death cross" meme.

Hey, speaking of which...

Next time you see a gloomy "news" "article" about Goldman Sachs' "negative" outlook for gold, remember that in December 2012 they expected gold to average $1800 in 2013.

Hey, in fact their recent "trimming" of their price forecast? Yes, it's true: they recently trimmed their forecast all the way to an average of $1787/ozt. Or, y'know, $200 up from here.

So forget the gloomy negative spin you're seeing in the news articles. Fact is, similar to how a rising price creates demand, a fall in price also creates news.

Oh, as an aside, check out the US monetary base chart, which I don't care much about but which Gary Tanashian finds significant.


Gee, US monetary base looks like a bubble, doesn't it?

I mean, if gold's in a bubble, because of its chart, then US monetary base is also in a bubble, no?

No? Monetary base can't be in a bubble? Oh. Okay then. So gold's not either.

Personally I don't see the correlation, except possibly by suggesting that US monetary base expansion drives central banks out of USD into gold, while also growing emerging market wealth, some of which gets invested in gold.

But Tanashian loves the chart, and always seemed to think it implies something. And in any case, dammit if that ain't one interesting divergence that someone's going to have to explain away if it doesn't result in a rising price of gold soon, eh?



Appendix:

By the way, Joe Wiesenthal, the Architectural Billings Index is not "an obscure indicator", you clickwhoring twat. Bill McBride follows it religiously, and in fact just noted its bullish suggestiveness today - five and a half hours before you filed your chickenshit article. So if I ever meet you in person I'm going to kick you in the fucking face. If the closest I can get to you is Josh Brown, I'll kick him in the face and tell him to pass it on.


Ask yourself this question right now

Is it the end of gold?

If so, why did palladium also drop today? You don't buy it because of interest rates; you buy it to put in a catalytic converter.

And why did oil drop today? You don't buy it because of interest rates; you buy it for fuel.

Any argument about the end of gold and silver has to take into account palladium's and oil's collapses, else it's bullshit.

End of lesson.

I'm interested in starting buying.

Faces of death - junior miners edition


Wow... look at this puddle of puke.


Argonaut was a great performer all last year. Now it's been puked hard.




Rio Alto, run by the estimable Alex Black, is down beyond three standard deviations and printing a red candle bigger than anything of the past 6 months.



Sandstorm Gold, a company with the license to print money, is down beyond 3SD, losing over 20% in three days.



B2Gold, run by the incomparable The Clive, flirting with $3 and they haven't even been dumped off the GDXJ yet.

None of these junior miners suck. All of these junior miners are immensely profitable and run by good management.

You'd think it was the end of gold mining or something.

Christos Doulis from Stonecap on BNN


Christos Doulis talks well. But all sorts of analysts talk well.

Here he is on BNN Market Sense last night.

Fortuna, and a comment


First, let me say how nice it feels to not have owned all these juniors while they were going down.

Second, check out Fortuna:


Seems like $3.95-$4.05 is kinda important.

(And yes I've upped my Bollingers to 2.5SD.)

Since Wiesenthal reads my blog....


BI - Why is gold collapsing?

OK Joey. Lesson for you.

Gold has been falling, and as we just mentioned, it's about to enter a "death cross", which is a technical analysis term that means it's fallen hard, and people think it will fall more.

"People"? Which "people"?

And you really need to explain "death cross" to Business Insider readers?

there are fundamental reasons why gold is declining

Oh good! Fundamental reasons! Tell me them!


When real interest rates are extremely low or falling, that's good for gold. And there's an intuitive reason for that. Collapsing real interest rates mean you're not getting paid much for being in currency, and the real economy probably isn't offering that much either. So, why not be in gold?

Is that what the Indians who buy 25% of world gold production think? Is that what the Chinese who buy 25% of world gold production think? Is that what central bankers think when deciding whether to buy USD or gold for their reserves?

No.

As noted before, usually rising TIPS yield indicates the Fed attempting to choke off an overheating economy, which is a negative for EM wealth creation and EMs buy gold so gold goes down. But TIPS yield rising means something different this time - the expectation of an end to extraordinary measures by the Fed. Which implies a strengthening US economy, which would be positive for EM wealth generation and thus EM gold demand.

Also, I know you're used to looking at very tiny things, and that's why that tiny turn-up in the TIPS yield in your chart is so interesting to you. But other people aren't interested in looking at your tiny little thing.

The other big driver of gold is fear. When people are in a panic, something in our reptilian brains tells us to buy gold, which is why it's been around as a quasi-currency for so long.

First: "something in our reptilian brains tells us to buy gold"?!? Seriously? Reptilian? Been watching David Icke videos? Or is this what passes for science down there in the US?

Second: "you" don't buy gold. Indians, Chinese, and central banks buy gold. You might once in a while buy futures if you had nothing better to do.

Third: "gold is a hedge against fat tail risk" - Ben Bernanke. Yes, and in the emerging markets fat tail risk is always there, and the only way for Indians and Chinese to hedge is with gold, and they buy 50% of world production, and so that's not going away any time soon.

A good way to demonstrate this is by a chart which compares the VIX (an index that measures market fear) to a ratio of gold/oil.

Looks like while there's a high-frequency correlation, at lower frequency there's a marked divergence. I.e., long-term while $VIX has been trending down, gold:oil's been trending up. Can you explain that, and specifically by making mention of "fundamentals"?

Also, while this relation is good for a pair trade, if you've spent 5 seconds trying to invest based on ratios you'll know that they mean shit about absolute price.

A rise in real interest rates and the collapse of fear are behind the drop in gold.

Because... fundamentals?

Sorry Joey, the "drop in gold" (which might freak me out if we get a weekly print below $1550) is because the herd is following what the goldbugs did in Q4 2012, some people are taking seriously India's threat to enact import controls on gold, we're approaching a historically weak month for gold, and the paper gold market is seeing increased competition from US equities now that people think the worldwide recession is past. So paper gets sold off.

Oh, and because of all the doom and gloom in the press.

Speaking of which, go check out the Bullish % gold, or the commitment of traders. Yes, right now.

Tuesday, February 19, 2013

Dark Evening of the Soul news


Lots of dark evenings of the soul going around. Let's see what the doom is:



Ritholtz - most Dow long-term charts are wrong. Dear young technical analyst: this is why you should always look under the hood before you chart anything.

New Deal Democrat - a few tardy notes about employment. He's worried that US hiring is in decline.

Bonddad - payroll tax increase starts to bite. He's worried that the Walmart Letters of Doom indicate the payroll tax increase is about to cave retail. However,

BI - is it maybe because of delayed tax refunds? Is that what's hurt Walmart's Feb sales? Well, if so, it should only take a couple weeks to find out, right?

Reformed Borker (Bork! Bork! Bork!) - but don't use the 'r' word. 92% of all YTD ETF inflows have gone into stocks. Should be 60%. But it's 92%.

All in all, seems like there's a lot of doubt creeping in about the US market (except with Josh Brown). Worries now about the beginning of a recession. Seems like a good time for the market to go down then, eh?

And as for mining?

Mineweb - India to further curb gold imports by end of February, or not. Better watch it or it'll act like Argentinian capital controls - you'll get a black market in gold that threatens to collapse the rupee. Why not fix your current account deficit a smarter way: by reducing your fucking fuel subsidies?

Biiwii - gold can still go down a while from here. Though god knows how gold miners will continue to mine it at $1300, or really even at $1525. Seems self-limiting, but then again the commodities are crazy-land, no?

Reformed Borker (Bork! Bork! Bork!) - gold miner update: yes they still suck. Josh notes since Einhorn's call, GDX is down 34% while SPY is up 25%. Add that to the $50 billion in writeoffs this year, and why would any smart investor still own gold miners that are so obviously run by fucking morons? I mean, it's so obvious that Deloitte has to offer to show them how to save mining costs by automating.

Mining.com - no really, this is how much gold miners suck. With a link to an Ernst & Young report on how much gold miners suck.

Mineweb - you thought miners suck? How about the explorecos?

Behavioural Macro - the goldbugs have to look for an out. He says other things too, but here's the kicker:

And it is still a crowded trade amongst the macro tourist crowd that hate US monetary policy, but, when you read what they write, clearly haven’t understood it (e.g. inflation, higher yields, US-is-Greece, pick your variant). Think Einhorn, Loeb, Paulsen, Dalio (though Dalio’s not a tourist), etc.
In short, the monetary tables are now turned: it’s not Bernanke who needs an exit strategy, it’s them.

I remain out of everything except some tiny positions in two Kaiser explorecos, a regrettable position in Aurcana warrants that I might actually add to if I can get $5K worth in the single digits, and... that's it, I think.

Oh, also one miner which actually isn't going down at all. Yet.

I'll be happy to jump back in and buy up a load of great producers at low, low prices, but not til I know a bottom has been completed.

For the time being though, puking my BTO at $3.70 or something seems smart now.

Some news


Gotta be quick cos lunch time at work is almost over.

Hey, look! Miners are still diving! Lotta great deals out there. I think I'll wait til everything completely pukes out before getting back into the market.

Though there are a few interesting divergences showig up already. Aurcana's stopped going down. Dundee Precious Metals, normally a bot-infested stock, is staying quite steady. FNV's steady. Maybe that means we've hit the low? I want to short silver and the goldminers but I just can't right now.

South China Morning Post - Commodity bears: look again at China credit growth.

Macrobusiness - RBA's Christopher Kent on China growth and the mining boom. Important macro comments that are important for mining. Definite important read.

PIIE - review of Pettis' new book on China. The Great Rebalancing is coming out, so Pettis is on the book tour, and so you'll hear a lot about his doom and gloom opinion on China for the next while. Understand that his opinion is coloured by politics and a neoliberal attitude to economics.

Calculated Risk - January port traffic.

BI - Greece imported only one new Ferrari in all of 2012. Well, of course! The rest have been smuggled through Bulgaria!

Mining.com - top 10 mining companies in 2012. Interestingly, most have seem production drop. Thus their shares should go down and gold should go up, no?

Ritholtz - why I am considering getting rid of comments. Same applies here, read it all. Every last word. Also, if I haven't approved even one of your comments in the past few months, ask yourself why you're still trying to give me your supposedly valuable opinion.

Monday, February 18, 2013

Evening links


Ritholtz - vaguely rude place-names of the world. Very inferior. For example, there are easily a dozen incredibly rude place-names in Newfoundland, but this map misses them all. Then again, it gets a lot of the British rude place names; though I question why you'd include Scunthorpe in the list and not Muckle Flugga, which sounds so rude they must have invented a new language for it. Also, they missed Fernando Poo. Also, what is so rude about "Ring", "Clam", or "Moorhead"? And "Conception Bay" - who is that rude for, an 11-year-old nun? Also, map seems not to work on Android phones. All in all, I give them a D-.

Reformed Borker (Bork! Bork! Bork!) - Africa is the new something-or-other. Wouldn't be too excited about buying them right now. Also, you'd need to find a much better way to play it than say GAF, which is a fucking garbage ETF that is named "Emerging Middle East and Africa" but should really be named "92 Fucking Percent South Africa". Nevertheless, barring a return to the 20th century's multilateralist imperialism, I think we're going to see Africa finally break out of the stone age over the course of this century.

Beyond Brics - EMs, the cheap and the expensive. Taiwan and Phillipines are no surprise, and neither is Russia trading at a P/E of 6 since nobody in their right mind would do business with Russians. But what the hell is Chile doing at at 24 P/E? And why does anyone in their right mind want Hungary?

Mineweb - we're always good for a reassuring article on gold. Some no-name fool at some dinky fund steals all my ideas about China.

Bloomberg - gold bets drop. To, y'know, the lowest level since the last time gold took off, as usual. BTW, check out the charts for JO and NIB - either there's a coming glut of coffee and cocoa, or there's some money to be made soon.

Joe Wiesenthal tries to make it up to me


I recently planted Weezie a figurative kick in his undescended testicles for grossly oversimplifying this month's Credit Suisse hack-job on gold.

But he tries to make it up to me today with this criticism of the recent Barron's cover suggesting Obama "will turn the US into Greece":

But the real point here is that Barron's isn't so much a newspaper, but rather a mass-market stock tips newsletter -- note the columns on the left about Rochester Medical and Linn Energy.

And there's a very wide overlap between investment newsletter services, and cranky, anti-debt, armageddonism. It's part of the pitch. If you've ever read a copy of Jim Grant's "Interest Rate Observer" or Marc Faber's "Boom, Doom, Gloom Report" you'll find it's basically divided into two parts:

First you get the author giving their big pronouncement on the world (E.G., Bernanke is ruining the dollar! All of this debt can only lead to WWIII!).

Then after that, you get your stock and bond and commodity tips, usually free from politics or philosophy. People want to be told a story. And the doom story tends to have appeal among the older, conservative readers of these publications.

Barron's has always been a conservative publication, but a cover like this is just a natural move for a stock tips newsletter.

Note also that the "emotional wind-up" is a very old, very scummy tactic to wind an audience up for a sale.

Now note that what he says about Faber & Grant and so on can also be applied to pretty darn nearly every single goldbug newsletter too - with the exception of Cookie/Hennigh, Kaiser, and some communist in Peru. Oh and maybe Coffin: I just looked at one of his writeups this weekend and it was astonishingly sober and sensible for a writer with many followers on the bulletin boards.

Anyway.

Weezie, you're still a click-whore. Unless you can develop some sort of system that allows me to bypass the click-whoring crap, your valuable commentary will always be drowned in a sea of chickenshit.

Your website is still the Thinking Man's ZeroHedge.

News bits for Monday


Ritholtz - Dave Ramsey does not understand "all time highs". One important point is you should buy at an all-time high - because it's quite likely the price will go higher. The other, though, is a good skewering of a "Christian financial guru" who really seems to be just another Christian scammer.

BI - a vast political espionage scandal set to engulf Spain. Y'know, I think this is a good thing, if it presages the broader extermination of the plutocratic elite. You can't have broad wealth creation when the plutocrats can simply steal out of the masses' pockets through "austerity"; and you can't have an efficient growth economy if the plutocrats are left in charge of the till. I think, broadly speaking, the markets (especially the bond markets) will see the good side of the coming extermination of the existing Eurocratic elite... then again, this article is written by that Euroskeptic queer Wolf Richter. So there's probably not even anything happening. Don't trust anything you read at Business Insider.

China Daily - China's gold demand set to beat supply by 2015. Which is also the date set for my demographic collapse of China. Uh-oh....

Sunday, February 17, 2013

A few weekend newsbits


Bonddad - weekly indicators - the payroll tax quandary. I'd think if the ending of the partial payroll tax holiday was going to have such a big effect on the economy, we would see it in the market.


Kiron Sarkar - daily news and opinion roundup. Pretty good this week - he points out that Weidmann is just a lone voice in the wilderness and we should just stop listening to the cunt. I think however that he makes far too much of Cyprus.

Oh and by the way: inspired by my love of irony, I will continue to use the "Euro Doom 2012" tag.


Reformed Borker (Bork! Bork! Bork!) - The healthiest M&A boom in decades. Again, Josh Brown has a point: this is that corporate cash piling into the market, via acquisitions. And it's a good time to do M&A, being mostly through the secular bear. If a corporation has a pile of money earning nearly nothing, why not invest it in an acquisition that can (assuming you know how to manage) yield more in future?


Ritholtz - weekly eurozone watch. Peripheral yields tightened versus Germany, which is good.


Bloomberg - Gold bears most bearish in over a year. I'll tell you what: whenever I hear a stat like "most bearish since...", I instinctually look at a chart now. And guess what...

Hedge funds cut bets on higher prices by 56 percent since October and are approaching their least bullish stance on gold since August, government data show....

Guess what? Last August gold was at its previous low. It went up $250 from there.

Twenty analysts surveyed by Bloomberg this week expect prices to fall next week, while 11 were bullish and three were neutral, making the proportion of bears the highest since Dec. 30, 2011.

Guess what? Dec 30 2011 was another local low. Gold went up over $200 from there.

Bloomberg's correspondent should point these things out when he includes bullshit sentiment in an article. If nothing else, it would up his word count.

So while I'm only neutral on gold, when you combine the above sentiment data with the fact gold was taken down at Opex, while China is on holiday, and we just happen to have the G20 this weekend saying they vow not to have a currency war (despite it being counter many countries' best interests, i.e. they're lying for the camera), and people are forecasting stronger US growth and China growth this year which will be bullish for EM gold demand - well, things don't look so bad for gold in the long term.