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David M Glassman, President

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Email: Stockmarketdoc@comcast.net

Octerber 17, 2018

This ‘prophet of doom’ predicts stock market will plunge more than 50%


Published: July 30, 2018 5:37 p.m. ET









































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Schiff: "The Next Crisis Is Not Going To Look At All Like 2008"

by Tyler Durden

Sun, 08/05/2018 - 14:05

154

SHARES

Peter Schiff is an economist who served as an advisor to Ron Paul in 2008 and even made a run for Senate on his own at one point. He’s well-known in the "Austrian" as well as the libertarian economic community, but is perhaps best known for his belief that our next coming crisis is going to be "an order of magnitude larger than the crisis in 2008", only this one, the Federal Reserve is not going to be able to print their way out of, Schiff predicts in his most recent interview.

"What the Fed is worried about is a repeat of the 2008 financial crisis. What they don't realize is the next crisis is not going to look like the 2008 crisis," Schiff said.

He makes the why the dollar going up in 2008 helped the Fed bail everyone out, and why it's going to be impossible for the Fed to do the same thing when the dollar collapses during the next recession. Schiff also explains that a loss of confidence in the dollar as the world's reserve currency could see interest rates move much higher, resulting in the U.S. defaulting on its debt.


Despite getting the 2008 housing crisis right, Schiff's appearances in the mainstream financial media have declined precipitously due to his bearish outlook. As an alternative, he has created a substantial voice for himself on his YouTube channel, which boasts hundreds of thousands of subscribers.

On Saturday, August 4, Peter Schiff appeared on the Quoth the Raven podcast to talk about a multitude of topics, including:

  1. Why the mainstream media doesn’t have him on anymore, despite predicting the 2008 financial crisis production dead-on

  2. Why the government should have let more banks fail in 2008

  3. Why he believes that a socialist will be elected in 2020 and why a libertarian may actually have a chance in 2024

  4. Why he believes the price of gold will be appreciating drastically in the years to come

  5. Why people are going to want to own commodities and emerging markets and get out of dollar denominated assets in the United States

  6. Why the Fed "stress tests" are rigged

  7. Why macroeconomic data shouldn't be relied upon

  8. How inflation will hit when newly printed money finally exits the capital markets

On the podcast, Schiff also notes how wrong the media and economists were in 2008, an accusation he himself has been the target of in recent years:

"It's a total double standard because it shows you their way of thinking. If you look at all of these experts that were completely wrong now that we're 10 years from the financial crisis...by 2007, the bubble had burst...even after it was so completely obvious. I was predicting it. They didn't figure it out until everything imploded..."

"I was going on television in mid 2008 saying 'we're in recession' and they were saying 'you're crazy, there's no recession in sight...'"

You can listen to the full podcast here:



<div class="player-unavailable"><h1 class="message">An error occurred.</h1><div class="submessage"><a href="http://www.youtube.com/watch?v=axyylJoZiBU" target="_blank">Try watching this video on www.youtube.com</a>, or enable JavaScript if it is disabled in your browser.</div></div>


In the podcast, Schiff also talks how Keynesian and Austrian economic theory differ, how inflation has an effect on the middle class, the politics of Trump's economic policy, and the recent volatility in tech stocks and tons more.

Peter's YouTube channel can be found here, meanwhile for those looking for some of the best alternative podcasts around, check out QTR's work at the following link.Schiff: "The Next Crisis Is Not Going To Look At All Like 2008"


by Tyler Durden

Sun, 08/05/2018 - 14:05

154

SHARES

Peter Schiff is an economist who served as an advisor to Ron Paul in 2008 and even made a run for Senate on his own at one point. He’s well-known in the "Austrian" as well as the libertarian economic community, but is perhaps best known for his belief that our next coming crisis is going to be "an order of magnitude larger than the crisis in 2008", only this one, the Federal Reserve is not going to be able to print their way out of, Schiff predicts in his most recent interview.

"What the Fed is worried about is a repeat of the 2008 financial crisis. What they don't realize is the next crisis is not going to look like the 2008 crisis," Schiff said.

He makes the why the dollar going up in 2008 helped the Fed bail everyone out, and why it's going to be impossible for the Fed to do the same thing when the dollar collapses during the next recession. Schiff also explains that a loss of confidence in the dollar as the world's reserve currency could see interest rates move much higher, resulting in the U.S. defaulting on its debt.


Despite getting the 2008 housing crisis right, Schiff's appearances in the mainstream financial media have declined precipitously due to his bearish outlook. As an alternative, he has created a substantial voice for himself on his YouTube channel, which boasts hundreds of thousands of subscribers.

On Saturday, August 4, Peter Schiff appeared on the Quoth the Raven podcast to talk about a multitude of topics, including:

  1. Why the mainstream media doesn’t have him on anymore, despite predicting the 2008 financial crisis production dead-on

  2. Why the government should have let more banks fail in 2008

  3. Why he believes that a socialist will be elected in 2020 and why a libertarian may actually have a chance in 2024

  4. Why he believes the price of gold will be appreciating drastically in the years to come

  5. Why people are going to want to own commodities and emerging markets and get out of dollar denominated assets in the United States

  6. Why the Fed "stress tests" are rigged

  7. Why macroeconomic data shouldn't be relied upon

  8. How inflation will hit when newly printed money finally exits the capital markets

On the podcast, Schiff also notes how wrong the media and economists were in 2008, an accusation he himself has been the target of in recent years:

"It's a total double standard because it shows you their way of thinking. If you look at all of these experts that were completely wrong now that we're 10 years from the financial crisis...by 2007, the bubble had burst...even after it was so completely obvious. I was predicting it. They didn't figure it out until everything imploded..."

"I was going on television in mid 2008 saying 'we're in recession' and they were saying 'you're crazy, there's no recession in sight...'"

You can listen to the full podcast here:



<div class="player-unavailable"><h1 class="message">An error occurred.</h1><div class="submessage"><a href="http://www.youtube.com/watch?v=axyylJoZiBU" target="_blank">Try watching this video on www.youtube.com</a>, or enable JavaScript if it is disabled in your browser.</div></div>


In the podcast, Schiff also talks how Keynesian and Austrian economic theory differ, how inflation has an effect on the middle class, the politics of Trump's economic policy, and the recent volatility in tech stocks and tons more.

Peter's YouTube channel can be found here, meanwhile for those looking for some of the best alternative podcasts around, check out QTR's work at the following link.Schiff: "The Next Crisis Is Not Going To Look At All Like 2008"


by Tyler Durden

Sun, 08/05/2018 - 14:05

154

SHARES

Peter Schiff is an economist who served as an advisor to Ron Paul in 2008 and even made a run for Senate on his own at one point. He’s well-known in the "Austrian" as well as the libertarian economic community, but is perhaps best known for his belief that our next coming crisis is going to be "an order of magnitude larger than the crisis in 2008", only this one, the Federal Reserve is not going to be able to print their way out of, Schiff predicts in his most recent interview.

"What the Fed is worried about is a repeat of the 2008 financial crisis. What they don't realize is the next crisis is not going to look like the 2008 crisis," Schiff said.

He makes the why the dollar going up in 2008 helped the Fed bail everyone out, and why it's going to be impossible for the Fed to do the same thing when the dollar collapses during the next recession. Schiff also explains that a loss of confidence in the dollar as the world's reserve currency could see interest rates move much higher, resulting in the U.S. defaulting on its debt.


Despite getting the 2008 housing crisis right, Schiff's appearances in the mainstream financial media have declined precipitously due to his bearish outlook. As an alternative, he has created a substantial voice for himself on his YouTube channel, which boasts hundreds of thousands of subscribers.

On Saturday, August 4, Peter Schiff appeared on the Quoth the Raven podcast to talk about a multitude of topics, including:

  1. Why the mainstream media doesn’t have him on anymore, despite predicting the 2008 financial crisis production dead-on

  2. Why the government should have let more banks fail in 2008

  3. Why he believes that a socialist will be elected in 2020 and why a libertarian may actually have a chance in 2024

  4. Why he believes the price of gold will be appreciating drastically in the years to come

  5. Why people are going to want to own commodities and emerging markets and get out of dollar denominated assets in the United States

  6. Why the Fed "stress tests" are rigged

  7. Why macroeconomic data shouldn't be relied upon

  8. How inflation will hit when newly printed money finally exits the capital markets

On the podcast, Schiff also notes how wrong the media and economists were in 2008, an accusation he himself has been the target of in recent years:

"It's a total double standard because it shows you their way of thinking. If you look at all of these experts that were completely wrong now that we're 10 years from the financial crisis...by 2007, the bubble had burst...even after it was so completely obvious. I was predicting it. They didn't figure it out until everything imploded..."

"I was going on television in mid 2008 saying 'we're in recession' and they were saying 'you're crazy, there's no recession in sight...'"

You can listen to the full podcast here:



<div class="player-unavailable"><h1 class="message">An error occurred.</h1><div class="submessage"><a href="http://www.youtube.com/watch?v=axyylJoZiBU" target="_blank">Try watching this video on www.youtube.com</a>, or enable JavaScript if it is disabled in your browser.</div></div>


In the podcast, Schiff also talks how Keynesian and Austrian economic theory differ, how inflation has an effect on the middle class, the politics of Trump's economic policy, and the recent volatility in tech stocks and tons more.

Peter's YouTube channel can be found here, meanwhile for those looking for some of the best alternative podcasts around, check out QTR's work at the following link.Schiff: "The Next Crisis Is Not Going To Look At All Like 2008"


by Tyler Durden

Sun, 08/05/2018 - 14:05

154

SHARES

Peter Schiff is an economist who served as an advisor to Ron Paul in 2008 and even made a run for Senate on his own at one point. He’s well-known in the "Austrian" as well as the libertarian economic community, but is perhaps best known for his belief that our next coming crisis is going to be "an order of magnitude larger than the crisis in 2008", only this one, the Federal Reserve is not going to be able to print their way out of, Schiff predicts in his most recent interview.

"What the Fed is worried about is a repeat of the 2008 financial crisis. What they don't realize is the next crisis is not going to look like the 2008 crisis," Schiff said.

He makes the why the dollar going up in 2008 helped the Fed bail everyone out, and why it's going to be impossible for the Fed to do the same thing when the dollar collapses during the next recession. Schiff also explains that a loss of confidence in the dollar as the world's reserve currency could see interest rates move much higher, resulting in the U.S. defaulting on its debt.


Despite getting the 2008 housing crisis right, Schiff's appearances in the mainstream financial media have declined precipitously due to his bearish outlook. As an alternative, he has created a substantial voice for himself on his YouTube channel, which boasts hundreds of thousands of subscribers.

On Saturday, August 4, Peter Schiff appeared on the Quoth the Raven podcast to talk about a multitude of topics, including:

  1. Why the mainstream media doesn’t have him on anymore, despite predicting the 2008 financial crisis production dead-on

  2. Why the government should have let more banks fail in 2008

  3. Why he believes that a socialist will be elected in 2020 and why a libertarian may actually have a chance in 2024

  4. Why he believes the price of gold will be appreciating drastically in the years to come

  5. Why people are going to want to own commodities and emerging markets and get out of dollar denominated assets in the United States

  6. Why the Fed "stress tests" are rigged

  7. Why macroeconomic data shouldn't be relied upon

  8. How inflation will hit when newly printed money finally exits the capital markets

On the podcast, Schiff also notes how wrong the media and economists were in 2008, an accusation he himself has been the target of in recent years:

"It's a total double standard because it shows you their way of thinking. If you look at all of these experts that were completely wrong now that we're 10 years from the financial crisis...by 2007, the bubble had burst...even after it was so completely obvious. I was predicting it. They didn't figure it out until everything imploded..."

"I was going on television in mid 2008 saying 'we're in recession' and they were saying 'you're crazy, there's no recession in sight...'"

You can listen to the full podcast here:



<div class="player-unavailable"><h1 class="message">An error occurred.</h1><div class="submessage"><a href="http://www.youtube.com/watch?v=axyylJoZiBU" target="_blank">Try watching this video on www.youtube.com</a>, or enable JavaScript if it is disabled in your browser.</div></div>


In the podcast, Schiff also talks how Keynesian and Austrian economic theory differ, how inflation has an effect on the middle class, the politics of Trump's economic policy, and the recent volatility in tech stocks and tons more.

Peter's YouTube channel can be found here, meanwhile for those looking for some of the best alternative podcasts around, check out QTR's work at the following link.Schiff: "The Next Crisis Is Not Going To Look At All Like 2008"


by Tyler Durden

Sun, 08/05/2018 - 14:05

154

SHARES

Peter Schiff is an economist who served as an advisor to Ron Paul in 2008 and even made a run for Senate on his own at one point. He’s well-known in the "Austrian" as well as the libertarian economic community, but is perhaps best known for his belief that our next coming crisis is going to be "an order of magnitude larger than the crisis in 2008", only this one, the Federal Reserve is not going to be able to print their way out of, Schiff predicts in his most recent interview.

"What the Fed is worried about is a repeat of the 2008 financial crisis. What they don't realize is the next crisis is not going to look like the 2008 crisis," Schiff said.

He makes the why the dollar going up in 2008 helped the Fed bail everyone out, and why it's going to be impossible for the Fed to do the same thing when the dollar collapses during the next recession. Schiff also explains that a loss of confidence in the dollar as the world's reserve currency could see interest rates move much higher, resulting in the U.S. defaulting on its debt.


Despite getting the 2008 housing crisis right, Schiff's appearances in the mainstream financial media have declined precipitously due to his bearish outlook. As an alternative, he has created a substantial voice for himself on his YouTube channel, which boasts hundreds of thousands of subscribers.

On Saturday, August 4, Peter Schiff appeared on the Quoth the Raven podcast to talk about a multitude of topics, including:

  1. Why the mainstream media doesn’t have him on anymore, despite predicting the 2008 financial crisis production dead-on

  2. Why the government should have let more banks fail in 2008

  3. Why he believes that a socialist will be elected in 2020 and why a libertarian may actually have a chance in 2024

  4. Why he believes the price of gold will be appreciating drastically in the years to come

  5. Why people are going to want to own commodities and emerging markets and get out of dollar denominated assets in the United States

  6. Why the Fed "stress tests" are rigged

  7. Why macroeconomic data shouldn't be relied upon

  8. How inflation will hit when newly printed money finally exits the capital markets

On the podcast, Schiff also notes how wrong the media and economists were in 2008, an accusation he himself has been the target of in recent years:

"It's a total double standard because it shows you their way of thinking. If you look at all of these experts that were completely wrong now that we're 10 years from the financial crisis...by 2007, the bubble had burst...even after it was so completely obvious. I was predicting it. They didn't figure it out until everything imploded..."

"I was going on television in mid 2008 saying 'we're in recession' and they were saying 'you're crazy, there's no recession in sight...'"

You can listen to the full podcast here:



<div class="player-unavailable"><h1 class="message">An error occurred.</h1><div class="submessage"><a href="http://www.youtube.com/watch?v=axyylJoZiBU" target="_blank">Try watching this video on www.youtube.com</a>, or enable JavaScript if it is disabled in your browser.</div></div>


In the podcast, Schiff also talks how Keynesian and Austrian economic theory differ, how inflation has an effect on the middle class, the politics of Trump's economic policy, and the recent volatility in tech stocks and tons more.

Peter's YouTube channel can be found here, meanwhile for those looking for some of the best alternative podcasts around, check out QTR's work at the following link.

 



 Relative Scarcity Of Physical Gold Prompts Large Drawdowns From Funds, ETFs


"It appears that there is a dwindling and overleveraged supply heading towards an unmanageable and relentless source of demand."

It is interesting to watch the ongoing management of physical gold holdings in the West.






















Physical gold has been seeing large drawdowns from inventory during this price decline, but silver does not...





















This is not due to some preference or matter of taste.   Physical gold for sale at these prices is in short supply, whereas silver is not.


















Both are subject to speculative price manipulation in the paper markets.







































The system will be maintained - until it cannot.  Although the game can be extended by a determined effort, no commodity pricing pool can last forever in the face of a stubbornly stable supply and a steady excess of off-take out of the pool, shenanigans and antics notwithstanding.

For now there around 6 ounces of paper gold allocated to each oz of physical gold in Comex repository...

















Physical gold is flowing from West to East, into the markets and strong hands of Asia. 

Bye bye gold.














The eventual resolution may be quite energetic in terms of price




You Can’t Eat Gold


“You can’t eat gold.” The enemies of gold often unleash this little zinger, as if it dismisses the idea of owning gold and indeed the whole gold standard. It is a fact, you cannot eat gold. However, it dismisses nothing.

This gives us an idea. Let’s tie three facts together. One, you can’t eat gold. Two, gold is in backwardation in Switzerland. And three, speculation is a bet on the price action.

The fact that gold is inedible is supposed (by the enemies of liberty) to be proof positive that a gold standard wouldn’t work. Of course, there’s always the retort: You can’t eat dollars!

That may be emotionally satisfying, but there is a deeper issuer that the anti-gold crowd is missing. Yes, money makes terrible food but, also, food makes terrible money. A car makes a lousy airplane. And a shoe makes an awful TV. Cow poop is putrid as food for people, but it works well as fertilizer for plants. Each thing fits a particular purpose.

Why does food make terrible money? One reason is that it’s perishable. No one—other than a refrigerated warehouse—can make a bid on food beyond his own short-term needs. Without this robust bid, food has limited marketability. That is, it has a wide spread between its bid and offer prices.

Think of it in human terms, or even personal terms. Suppose you strolling along the sidewalk, and you’re hungry. You see a restaurant sign, “Hamburger + fries + drink $10.” You would pay the offer price. The next restaurant is going out of business, and its sign says, “All inventory must go! 50 hamburgers and 50 pounds of fries for $100!” You would not pay it (unless you were with 49 friends).

Why not? It’s because you can’t possibly carry 49 juicy hamburgers and 49lbs of hot, greasy fries with you as you walk! The bid price is zero or nearly zero. So the bid-ask spread on food is quite wide.

Other than for eating, a hamburger serves no purpose. And you only need to eat a finite amount (unless you are Hafthor Bjornsson). Any burgers beyond that are of no value to you, because they don’t keep very long. You don’t want to stockpile them

Economists would say that the marginal utility of hamburgers falls rapidly. The first hamburger satiates your hunger. The second fills you up. The third, well, maybe you were really hungry. The fourth doesn’t do anything for you. It’s useless.


Gold is in Backwardation in Switzerland

Now we switch to the second topic. Gold is in backwardation in Switzerland. What does that really mean in human terms? It means you can give up your 100oz gold bar for 3 months, get free use of about CHF 120,000 in the meantime, and in the end get your gold bar back. Plus about CHF 400 in profit.

No one is taking this deal.

Let that sink in. Lots of people have these gold bars. Which they cannot eat, as we have already proven. But they won’t let them go for even three months. The free use of francs and the profit are not attractive. This either means they don’t trust their counterparty to give the gold back, or else that the francs are even more useless than the gold.

Given the high price of the franc—just over $1—we don’t think that the problem is trust of the counterparty. We would say (and have argued these past few weeks) that the problem is that the Swiss National Bank so flooded the market with francs that they’re now useless.

So useless, that people will not decarry gold for a profit. So useless that the bid to borrow them—the bid on the interest rate—is negative.

Speculative Assets Are Useless

Switching topics again, let’s return to something we have often criticized: buying stocks or bitcoin with the hope that the price will rise. Why will it rise? Because the next guy will come along and bid higher. Why will he do that? Because he expects the yet another buyer to bid even more. And so on?

No. There is an end to this cycle. Inevitably, the supply of buyers is depleted. And then what happens is silver in spring of 2011. Or stocks in 2008. Or tulips in 1637.

Why are there no more buyers? To answer, let’s tie all three of these seemingly isolated facts together. People are buying something, not for any use they can make of it, but solely to front-run that next buyer. He also has no use for it, but merely buys to unload to the next buyer in the chain.

They’re all buying something they can’t use, in the hopes of selling it, but no one is asking if anyone has any use for it!

This is why mainstream investors do not buy gold.

We, the gold community, must change our message if we want to reach them. “Gold’s going to $10,000” is not reaching them. At best, mainstream investors think “maybe”. Or else they think, “Youhave predicted 93 of the past 0 gold spikes to $10,000.”

If the only purpose of a thing is to sell it for a higher price, then that thing has no purpose. This could almost be a corollary to Mises’ Regression Theorem. Anyways, gold (unlike francs nowadays, or tulips back in the 17th century) does have a productive purpose.



We spill a lot of words talking about borrowing, lending, interest, debt, extinguishing debt, and servicing debt. We dismiss the definition of money commonly held to be the “medium of exchange” as wrong. We believe that it smuggles the premise that the government can change economic law merely by enacting legislative law.

It is more important to look at whether a thing can extinguish debt than whether it trades for hamburgers. Why is money not defined in terms of purchasing power, but as the most marketable good? Why is it important to compare the hamburger, whose marginal utility falls to zero, the franc, whose marginal utility is now apparently negative, with gold whose marginal utility is a flatline or nearly so?

Money is Gold, Gold is Money

The hamburger is food because it provided nutrition. Gold is money because it has the narrowest bid-ask spread of any commodity. It has the highest stocks to flows, which shows that its marginal utility declines so little—that after thousands of years of accumulation, we’re still mining more. It is the most marketable commodity, because it has a use to billions of people.

That use is final payment. Even if most people, most of the time, are happy to be creditors, some people some of the time want to be finally paid. Gold, the extinguisher of debt, is final payment.

There is never any question about the value of something that has constant or nearly constant marginal utility, because it is final payment demanded by billions of people.

Note: we are not saying payment as in exchange for goods. We are saying payment as in what a creditor demands in satisfaction of the debt. Money is a capital asset. It is not necessarily the hot potato that people receive as wages, and rapidly turn around to pay for goods.

Consider the case that China sells consumer goods to America to obtain dollars, just in time to pay Venezuela for oil. And they, in turn, pay them out in wages, machine parts, and welfare largesse. For this scenario, any old medium of exchange will do. The dollar works fine, and the parties involved would not agree if you denied it.

But money is the thing which is valued specifically to hold, and for the sake of holding it. Unlike the dollar, which can clear trade as a medium of exchange but is not good for saving—gold is good for saving.

Unlike bitcoin, which people speculate will have greater purchasing power. They plan merely to exchange bitcoin for a greater quantity of consumer goods tomorrow. If something is just a token held to trade for consumer goods, it is not a capital asset. It is just deferred consumption, just a deferred consumer good.

Keynes taught that consumption makes the economy go. We suppose that, to Keynes, if an asset goes up and people can sell it to consume more, this is a good thing. Anyways, Keynes was utterly wrong. This is a frivolous error. One cannot consume something that has not been produced. Production must precede consumption.

For hundreds of thousands of years, humans lived at the level of subsistence. They could only produce whatever could be done with their own hands, and at best simple hand tools. They did not accumulate capital.

Capital accumulation and investment make the economy go. Keynes misses this fact, along with all who love the (seemingly) endless rise in asset prices driven by the (pathologically) falling interest rate. They think that it’s possible to consume without producing, by just betting on rising prices. They don’t know that they are just eating the seed corn.

So long as one man has a surplus of hamburgers and another has a surplus of gasoline, they will want to trade. So long as men want to trade, there will be some kind of medium of exchange. But that medium of exchange is not necessarily money. That medium can convey value, but not store nor measure it.

JP Morgan said it best, in his testimony before Congress.

“Money is gold, and nothing else.”


This Report was written from Washington, DC. Keith will be in New York City, London, Brussels, Madrid, Zurich, Hong Kong, Singapore, Sydney, and Auckland. If you would like to meet, please contact us.

Supply and Demand Fundamentals

The price of gold went up $14, but the price of silver fell 3 cents.

The fundamentals are firming up a bit, more in gold than in silver, while the S&P index is falling 125 points—over 4%—in a week. So far, this seems to be playing out as we said it could. The stock market has been on a steady escalator trip upwards since Obama took office. By contrast, the prices of the metals have been down and sideways since 2011.

So if there is a rising crisis due to rising rates, falling currencies, debtor defaults and all the rest of the syndrome, then the precious metals would not necessarily behave as they did in 2008. Recall that by the crisis, the metals had been in a bull market for seven years.

Now they have been in a bear market for that same length of time.

We will look at the supply and demand fundamentals of both metals. But, first, here is the chart of the prices of gold and silver.


Next, this is a graph of the gold price measured in silver, otherwise known as the gold to silver ratio (see here for an explanation of bid and offer prices for the ratio). It rose this week.


Here is the gold graph showing gold basis, cobasis and the price of the dollar in terms of gold price.


The price of the dollar dropped a bit, again this week. We don’t say this merely to be pedantic. If one thinks that gold goes up and down, and that the very measure of altitude is the dollar, then one cannot understand what is really going on. One should see a week like this one as a drop in the value of the dollar, not a rise in gold.

With that drop in the dollar, we have an increase in the scarcity of gold. One commenter on Twitter this week wondered why they didn’t issue more shares of GLD as the price rose. The answer is that the rise was not centered in GLD, but in metal.

The Monetary Metals Gold Fundamental Price turned around, rising from $1,272 to $1,299.

Now let’s look at silver.


In silver, of course the metal became scarcer. Of course, because its price fell. That is, we’re not looking for where the buying was focused. We are looking for where the selling was focused. As is the typical pattern, speculators selling futures.

The Monetary Metals Silver Fundamental Price also rose a few pennies, from $15.27 to $15.31.

Commodities & Yields attempting multi-decade breakouts!

by Chris Kimble | Oct 10, 2018 | Kimble Charting


CLICK ON CHART TO ENLARGE

This chart looks at Commodity ETF (DBC) over the past 12-years as well a 2 & 5-Year yields over the past couple of decades.

DBC peaked in 2007 and has created a series of lower highs ever since. The rally over the past couple of years has DBC testing falling resistance that started 11-years ago.

While commodities are testing long-term resistance, the same can be said about interest rates too!

The yield on the 2 & 5-year notes is testing long-term falling resistance as well at each (1). The last two times that yields touched these long-term falling resistance lines was back in 2000 & 2007.

What commodities and yields do at each (1), will send monster important macro messages to Commodities and Bonds friends. These are price tests seldom seen in the past 10 to 30-years! What bonds and commodities do with these resistance lines, will become very important to stocks!!!

Stocks Bounce... Then Comes the REAL Collapse Pt. 2


Stocks are clinging to the ledge of a massive cliff.

It was only through multiple trader games that stocks were able to reclaim their 200-DMA on Friday.



This line is of TREMENDOUS importance as it has acted as critical support ever since this last bull market began in early 2016. The fact that it required this many trader games and manipulations to reclaim it on Friday tells us that stocks are in SERIOUS trouble.




So while it’s likely we’ll get a relief bounce this week (it is options expiration week, which usually features a rally of some sort), the fact remains that unless a MAJOR rally begins now, there are nothing but air pockets from here down to 2,400 on the S&P 500.


Again, stocks are clinging to the ledge of a giant cliff. And unfortunately, it's looking more as if the bull market has ended. As I've been warning clients for the last two to three months, "it's late 2007" for the markets.

If you aren't actively taking steps to prepare for this, you need to start NOW.

Fidelity Launches First Institutional Crypto Trading And Clearing Operation


Roughly 18 months after Fidelity investments started allowing customers to interface their Coinbase accounts with Fidelity's platform, the company - which started mining bitcoin at a small profit during the 2017 boom - announced on Monday that it had launched a separate company, Fidelity Digital Asset Services, that would handle cryptocurrency custody and trade execution for institutional investors.


For now at least, FDAS' services are only accessible by institutions like hedge funds, endowments, and family offices. However, such a monumental vote of confidence in crypto by a member of the financial establishment could revive traders' hopes that the long-awaited flood of institutional money could soon arrive to reinflate the prices of the largest cryptos. The company was reportedly developed out of the Fidelity Center for Applied Technology, or FCAT as employees call it.


"Our goal is to make digitally-native assets, such as bitcoin, more accessible to investors," Fidelity Investments Chairman and CEO Abigail Johnson said in a press release. "We expect to continue investing and experimenting, over the long-term, with ways to make this emerging asset class easier for our clients to understand and use."

While crypto prices spiked overnight, the news, which broke Monday afternoon, had little impact on the price of bitcoin and other top cryptos, which have fallen into a sustained slump since peaking at all-time highs late last year.


Long-term crypto bulls like Mike Novogratz were quick to applaud Fidelity for being "ahead of the pack" with its foray into crypto, and that others would soon follow.

Fidelity's head of crypto said the company decided to launch the business because it saw a "need" for institutional trade-execution services in the crypto space.

"We saw that there were certain things institutions needed that only a firm like Fidelity could provide," Jessop told CNBC, adding that it already works with 13,000 institutional clients. "We've got some technology that we've repurposed from other parts of Fidelity — we can leverage all of the resources of a big organization."

The new company, which has about 100 employees, will be headquartered in Boston.

Perhaps the most important service being offered by the company is crypto custody, which has so far stymied institutions from holding crypto directly. Because of the ease with which crypto can be stolen by hackers, the need for a secure custody bank to hold on to institutions' crypto had, until now, gone unmet. Fidelity said cybersecurity would be a top priority for the new company.

According to Fidelity, it already has a "pipeline" of customers, per BBG.

"Most institutions want to deal with another institution,” Tom Jessop, who is heading the unit, said a telephone interview. “We understand institutional finance."

The firm has a "robust pipeline of customers," said Jessop, who was previously president of Chain Inc., which offers blockchain technology to financial companies. There are more than 370 crypto funds managing as much as $10 billion in assets, according to Autonomous Research -- still just a drop in the bucket in the investment universe.

But Fidelity will soon need to grapple with a handful of other high-profile entrants into the crypto custody market, including Nomura, Goldman Sachs and Northern Trust.

The new company will handle custody, or how to safely store digital assets. Crypto companies Coinbase, Gemini (run by the Winklevoss twins), BitGo, Ledger and ItBit are among those already working on similar solutions. Japanese bank Nomura also announced plans in May to offer crypto custody, and Goldman Sachs and Northern Trust are reportedly exploring custodial services. But until now, there's been a noticeable lack of a big U.S.-based incumbent like Fidelity officially entering the space.

Part of the risk in cryptocurrency investing, which experts say has largely barred institutions from embracing them, is how to prevent these digital assets from being hacked. As of the end of June, $1.6 billion in cryptocurrency had been stolen from clients, according to CoinDesk's 2018 State of Blockchain Report.

Fidelity will use "cold storage", a technique whereby coins are held on an air-gapped hard drive, to secure coins in its custody.

Fidelity has a long history of dealing with enterprise security, as well as public and private key cryptography to make sure it isn't part of that statistic. Its custody solution will involve vaulted "cold storage," which involves taking the cryptocurrency offline, and multi-level physical and cyber controls, among other security protocols that have been created leveraging Fidelity's security principles from other parts of the business.

"You might look at the crypto world and say 'wow is this a new thing' but we've been managing key materials for a long time," Jessop said. "We took our learnings in how to run enterprise security, then through our exploration of bitcoin and some of the people we've hired, quickly developed some of the crypto native expertise and federated the two those things."

As CNBC pointed out, college endowments have led the institutional push into crypto funds, with endowments at Yale, Harvard and several other top schools owning exposure to at least one crypto fund.

While this is undoubtedly a vote of confidence in the crypto market, it's worth noting that the launch of crypto futures late last year was supposed to bring a flood of institutional money into bitcoin and other crypto. But so far, whatever impact they have had has done little to keep the price elevated.

Galaxy's Mike Novogratz noted, after the announcement, that a Bitcoin price move "awaits institutions getting in" and sees a "big price move in Bitcoin in Q1/Q2."


Short Term Bottom?


 

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