Friday, October 2, 2015
Gold popped on jobs numbers, for little reason, and GDX seems finally to be following:
And wow, these charts look interesting, at least in that GLD failed to make a lower low these past few months, and GDX also failed to make a lower low these past few months.
There was no lower high either, which meant there was constant selling pressure (in case the surge in volume since July isn't obvious to you).
So does Wall Street Whitey suddenly have to reverse his position on gold? I mean, now that China is reporting central bank gold purchases every month, and the Chinese are still importing gold via Hong Kong, and Indians are still buying gold for wedding season?
GDX's chart looks to me like it'll have to make an attempt at a higher high soon, because otherwise its chart needs to break down and collapse. It's the ugly kind of chart that should break down and collapse. And GDX has no reason to break down now that Whitey's cleaned out his cupboards, should it? I mean, what with impending economic doom and all, right?
This'll be interesting to watch for a few days, anyway. Keep your fingers crossed, goldbugs: you might be able to make some serious coin before Xmas.
And if you do, Wall Street Whitey is going to look at you all jealous given his own losses this year in US equities, and then he might decide to start buying back the miners that he's only just finished dumping.
Thursday, October 1, 2015
I haven't been getting any Cookie Monster news recently because my old email address finally got sent to the glue factory.
So this morning I went looking on YouTube for recent Cookie interviews, and found both an interview with Vanessa Collette and one with Daniela Cambone.
So let's get this over once and for all: who's the supreme junior mining hottie? Judge based on interviewing skills, rapport, or fashion sense, I don't care.
Place your bets now!
And no, Teresa Matich, you don't get a title shot this year. If that's a problem, take it to Vince McMahon.
Bunch of stuff for you:
Conversable Economist - exchange rate moves in historical terms. Hey, if you've been listening to all that blather about EM currency collapse, can you tell me if they've told you that the rupee and yuan have both appreciated in the last year? So, in other words, dollar-denominated debts in these two countries have worked out well for their corporations? Really? So there's no reason to worry about dollar-denominated debt in China and India? Really?
FT - making the China numbers add up. A lot of chatter about various measures of China GDP, so that you don't get stuck listening to the uninformed crap of some hedge fund cokehead who read once about the Li Keqiang index.
Oh and by the way, September China consumer sentiment came in at 118.2, strongest reading since May 2014. Gee, that really sounds like the Chinese are panicking about their equity market "collapse", eh?
Reuters - India's final monsoon total: 14% deficit. Well, Skymet sure pooched that call. Nevertheless, it takes more than a 14% deficit to truly dent Indian farm yields.
Bloomberg - China continues spending on high-speed rail. And everyone uses it too. So don't believe any stories about "ghost trains":
The 1,318-kilometer (819 miles) Beijing-Shanghai high-speed line started turning a profit last year, three years after opening, according to state media.And, just so you economics newbies understand why they're doing this:
A line from Beijing to downtown Tianjin, a 39 minute express, has proven so popular that a second line will now be built.
China enjoys clear "catch-up" advantages versus developed nations, which see smaller marginal gains from infrastructure spending, said Mark Williams, chief Asia economist at Capital Economics Ltd. in London. That’s why China’s investment may pay off more than Japan’s in the 1990s, he said.This heavy infrastructure spending is why China sees productivity gains year after year, while India is forever stuck in the 1920s.
Mining.com - China central bank adds to gold reserves. Really? So gold is still worth something to the Chinese? Hm... so does that mean we should sell them all the gold we have?
Tuesday, September 29, 2015
FT Alphaville - diminishing petrodollar flows. Quote:
Nigel Sillitoe, chief executive of financial services market intelligence company Insight Discovery, said fund managers estimate that Sama has pulled out $50bn-$70bn over the past six months.To me, the big question is how much money the Saudis had in gold miners. And for how long they'll continue to withdraw.
“The big question is when will they come back, because managers have been really quite reliant on Sama for business in recent years,” he said.
Since the third quarter of 2014, Sama’s reserves held in foreign securities have declined by $71bn, accounting for almost all of the $72.8bn reduction in overall overseas assets.
WSJ RTE - is wealth inequality hidden in tax havens? Probably, yeah, to the tune of at least $6 trillion. Why don't you figure out what that does to your classical model of the open economy, Dr. Mankiw? Hm? Wanna maybe address this in the next edition of your shitty macro textbook, maybe? No?
FT Alphaville - a history of leverage and the mining industry. The impending wipeout of Glencore has made it to the pages of the FT. Are we calling a bottom yet, or is this expected to continue for a while?
Mining.com - watch an excavator right a dump truck. This simply confirms that all mining people played with toy trucks as children, and just never grew out of it.
And yeah, when I was a kid my dad bought me a toy articulated grader. Kinda like this:
|but smaller of course|
But graders are fucking boring.
Monday, September 28, 2015
Thought I'd take studying a bit more seriously, so I'll be posting even less. But still, here's some news:
New Deal Demoncrat - weekly indicators. Same as last week basically: his thesis is still US consumer expansion simultaneous with a worldwide industrial recession.
Calculated Risk - vehicle sales still good, quit piddling your panties. Though there's a calendar effect.
WSJ RTE - top US financial diplomat's view on China. But then he pipes in about commodities:
But as low prices and anemic growth prospects cause stagnation in exploration and production investment, the amount of superfluous supply, or excess capacity, should gradually thin.So quit piddling your panties, goldbugs!
And “with over 1 billion Chinese and over a billion Indians looking for Western kinds of lifestyles, I think over the medium and long run, there will be ample demand for commodities,” Mr. Sheets said.
Reuters - VW scandal exposes cozy ties between auto industry and Berlin. More on the endemic corruption in Germany. Quote:
But there is one constant: the clout of the auto industry in German politics.That sounds like corruption to me, Germany! So when are you going to clean up your corrupt kleptocratic regime?
This relationship, which some describe as symbiotic, bordering on incestuous, is in the spotlight now, as Volkswagen (VOWG_p.DE), the country's largest carmaker, reels from an emissions scandal that has forced out its long-time CEO Martin Winterkorn and sent its stock careening lower.
But authorities in Germany and elsewhere in Europe had known for years about the widening gap between emissions values measured in official laboratory tests and those recorded in a real-world environment.
Yet, critics say, Berlin fought hard to shield its carmakers from closer scrutiny and, in a high-profile clash with its European partners two years ago, from tougher emissions targets. Merkel has defended the stance as necessary in order to protect jobs in the sector.
Some see the VW scandal as symptomatic of a deeper problem in which German car companies have been allowed to do as they please without oversight or fear of reprisals from Berlin.
Calculated Risk - Yellen still sees raising rates before end of year. In her talk at UMass Amherst (where someone who I went to highschool with is a professor of economics, interestingly; and btw it's also apparently a heterodox school so that might tell you something about Yellen's common sense) she made mention of the "special factors" causing inflation to be temporarily below target.
For example, oil really started to plummet last October, and got serious in November. Now, did you know that CPI and the Deflator are year-over-year measures? Well, that means the deflationary shock of low oil prices will have worked its way through the system entirely by next January. The CRB index will still be -10% at that point, but at least it won't be -30%. These may positively impact the inflation rate by January, at which point the Fed has to already be raising rates to make itself look ahead of the curve.