ZeroHedge: Chart Of The Day: China Imports Over 2,000 Tons Of Gold In Last Two Years GLD, MUX, TNR.v, GDX

  Zerohedge reports about China's increasing appetite in the Gold market, confirming the big picture we are discussing these days.

Andrew Maguire: Gold Smashdown, FED Defends The Dollar And How Goldman Sachs Operates. GLD, MUX, TNR.v, GDX

"Andrew Maguire presents to us the chronicles of ongoing war behind the curtain with FED defending the US Dollar at the crucial level 0.80 and how the FED's #1 Gold Prime Dealer Goldman Sachs operates in the Gold market. Now we have more information on why Goldman Sachs has issued the Sell Call on Gold last Wednesday. 

   All these revelations will never lead to the higher Gold prices without Buyers and one can argue that this manipulation can go forever. According to the Andrew Maguire the key crucial difference now is that Central Banks are buying and, particularly, China is taking all available Gold for physical delivery now."

Catalyst: Uncovering China’s Rush for Gold GLD, GDX, MUX, TNR.v

"While a lot of people are still wondering why the Gold is beaten down again, it is important to keep the big picture in front of you. As it is happening with Copper now the main player in this market is the same - China is on track to implement state level plan to diversify US Dollar based assets.

  We would like to share with you brilliant report conducted by Jan Skoyles on this subject."

ZeroHedge:

Chart Of The Day: China Imports Over 2,000 Tons Of Gold In Last Two Years

China has just one thing to say to all those who engage in the now daily slamdowns of gold just around the time of the London fixing, after 8 am Eastern, which lately have gotten so vicious they have resulted in "stop logic" market halts not on one but at least two occasions, keeping the price of gold delightfully low for all those who instead of selling, are looking to buy: "thanks."

As the chart below shows, in the past two years since September 2011 (ironically the same month we wrote "Wikileaks Discloses The Reason(s) Behind China's Shadow Gold Buying Spree" namely that the PBOC was quietly seeking to make the renminbi the new gold-backed reserve currency) the mainland has imported an unprecedented 2,116 gross tons of gold from Hong Kong (in addition to the hundreds of tons produced domestically), for the first time crossing the 2k gross ton import barrier in a two year period!

Focusing on just the most recent import data for the month of August, seemingly unaware that all expert, hedge funds in the US have been "capitulating" on gold just because the momentum trade is no longer there, and because it somehow makes more sense to buy gold when the price is high rather than low, shows that China imported 131.4 gross tons of gold in the month, a 146% increase compared to a year prior, when the price of gold was substantially higher. Indeed, in a "shocking" turn of events, China actually buys morephysical gold when the price is lower than higher. So much more, in fact, that August was the second highest gold importing month in history, lower only compared to March when it imported an unprecedented 223.5 tons.

But what about exports of gold, and China's net monthly gold needs. The chart below should answer that particular question. Net of gold export to Hong Kong, China imported 110.5 tons, the second highest net number in history, and second once again, only to March's 136.2 tons. Year to date, China has imported a gross 997 tons, and a net 741 tons. Since this accounts for just two-thirds of the year in the history books, on a gross and net basis, China will likely import over 1500 gross and over 1000 net tons for all of 2013: an absolutely stunning record in gold demand by just one nation.

Finally, putting all this feverish gold accumulation in perspective, here is the latest amount of official Chinese gold holdings as per the IMF. Incidentally, this is a number that has not been "updated" since April 2009.

The unofficial China gold holdings number since 2009 based on our internal calculations:about 2500 tons higher, which would make it the world's second largest official gold holder below the US and surpassing Germany, and rising at 100 tons per month.

Source: HK Census Dept"

Guess Which "Bearish" Bank Bought A Record Amount Of GLD In Q2 GLD, GDX, GDXJ, MUX, TNR.v

 

  Zero Hedge reports what we have already suspected, but now it is the matter of fact and we have the clear answer Who Was Buying. We must be close to that Waking Up Moment Peter Schiff is talking about.

Matrix Strikes Back - Gold Wash Out, Goldman Advises To Sell - China Buys Physical Gold By Tons.

"It was quite a week for Gold. Goldman Sachs and JP Morgan, must be after reading our entry on Gold this week, has delivered Jim Puplava's "Puke Moment" for all Gold market investors. Gold is Trashed, all stops are taken over. We will look this weekend into the actions behind the scene and particularly who was selling and who is buying. Stay tuned..."

Peter Schiff: When Investors Wake up the Gold Price Will Soar GLD, GDX, GDXJ, MUX, TNR.v

ZeroHedge:

Guess Which "Bearish" Bank Bought A Record Amount Of GLD In Q2

"In early April, the status quo was exuberant when none other than Goldman Sachs issued a "sell" on the barbarous relic that has become so indicative of the exuberance of central planning. At the time, we were skeptical (to say the least) and, just for extra Muppetting, the bank also suggested its clients buy Treasuries. Well, now that the full details of holdings changes have been released for Q2, it is perhaps clearer than ever before that as the bank was telling its clients to "sell, sell, sell" it was itself "buy, buy, buy"-ing the Gold ETF (GLD) with both arms and feet. In Q2, Goldman Sachs added a stunning (and record) 3.7 million 'shares' of GLD. As Paulson dumped his GLD, Goldman lapped it up to become the ETF's 7th largest holder.

Goldman was the largest adding holder for GLD...

buying what its clients were selling in size...

Citi Asks "How High Can Gold Ultimately Go?" GDL, GDX, GDXJ, MUX, TNR.v

  

  Zero Hedge reports that Citi joins our A Team calling for the Bull Gold Market and much higher prices.

Gold Breakout: Jim Sinclair - The three entities that called the $1900 in gold are back long. GLD, SLV, GDX, MUX, TNR.v

"Now we have the full A Team calling for the New Bull Leg in Gold. Summer doll drums time out is officially over. Gold was over 1400 intraday and Silver is over 24 now. Junior miners are exploding to the upside with McEwen Mining pushing 3 dollar mark. Survived Juniors will show this Fall what is called the ten baggers again."

McEwen Mining Up 11.7% On 7 Mil Shares, Trading Above 200MA $MUX, $TNR.v

"McEwen Mining is strongly Up today - more than 11% on 7 mil shares. With Gold and Silver markets down after recent breakout we can anticipate some news from the company.  Rob McEwen was taking about upcoming Los Azules Copper PEA in September and M&A ideas to combine with another Gold Mining company to reach his goal of being included in S&P 500."

ZeroHedge:

Citi Asks "How High Can Gold Ultimately Go?"

Via Citi FX Technicals,

Gold looks to have found a base...

Following the multi-year surge in Gold the recent fall took us 14% below the 55 month moving average. That is exactly what happened in 1976 during Gold’s correction after a multi-year move higher.

Once that moving average was regained on a monthly close basis the uptrend re-established itself and Gold rallied for the next 3 years. (included in that period was the “supply shock” driven move higher in crude)

The rally in the Equity market after the 1973-1974 “crash” peaked 4 weeks after that corrective low was placed in Gold.

SO FAR the trend peak in the stock market (DJIA and S&P) has taken place 5 weeks after the corrective low was posted in Gold.

After that peak in late 1976 the Equity market entered into an 18 month long 27% correction.

Gold weekly chart- Prior support now good resistance

The pivotal breakdown level on Gold was at $1,522-1,527 and should now be pivotal resistance in this rally.

Gold broke below this level during the week of 08 April 2013. It is unlikely that it is a coincidence that that precipitous fall took place in the same week that the S&P 500 regained its 2007 highs.

So, do not be surprised that IF , as we expect Gold heads higher to re-test this $1,522-1,527 area in the weeks/months ahead that the S&P is re-testing the break out point of 1,576 again...

........

We still retain a view that we can see a “low to high” percentage move in this bull market similar to what we saw in the bull market of 1970-1980.

If we extract the final leg of that move in December 1979-Jan 1980 which was totally driven by the USSR invasion of Afghanistan almost doubling the price of Gold over 5 weeks then we end up with a target of around $3,500 over the next 3 years or so.

The charts below are compelling in that respect, but before we look at them we will indulge in some pontification.

We are at a point of change of leadership at the Fed with two primary candidates being mentioned. (Janet Yellen and Larry Summers). We are NOTgoing to opine on who it should be but rather make observations about why we think it is going to be one rather than the other.

When President Obama spoke on the Charlie Rose show about Chairman Bernanke’s tenure it was obvious that it was coming to an end. The question to ask was why? If we (He) was happy with the path being followed, why not just ask Ben to stay on. (We also firmly believed that if asked Ben would have stayed). It is therefore not a stretch to believe that the President was less than convinced about the “efficacy” of QE. Reasons for this could well have been (supposition on our part):

• Sub-par economic growth of 1.7-2.0% and very low nominal growth given the low level of inflation
• A falling unemployment rate... yes (7.6% at the time)... but not of the magnitude and quality that we associate with an economic recovery(Lowest participation rate since 1979 flattering the rate;underemployment at the time (U6) at 14.3%; the majority of jobs being created are part time jobs with the 55-69 year old age group the primary demographic beneficiary)
• Housing recovering but very gradually compared to previous cycles and a view in a lot of circles that a significant chunk of demand was private equity buying distressed assets
• An Equity market rallying about 140%+ (The rich get richer, the gap gets wider)
• Banks et all benefiting from never ending cheap money and being encouraged to misallocate capital in financial assets that are being made almost risk free by the Bernanke, ever expanding, “QE to infinity” put
• Provides a benefit to the marginal borrower while “crucifying” the whole savings base
• Continued QE created a back stop to allow congress to push harder on budget cut and debt limit negotiations (Play hardball)

Let us say that some or all of that was true. Would the President really want to appoint somebody who to a very large extent would be likely to follow the same “prescription” (Yellen)? Why? If you wanted to continue that policy then would you not do that with the “guy” who engineered it and took us through the crisis (Bernanke)? Or do you feel that your financial “Churchill”…the man to fight the war is no longer the direction you want to go. We firmly believe that “change is afoot” and that change goes by the name of Larry Summers.

Why is that important?

Nothing suggests that Summers is a “hawk”. However, there are suggestions that he questions the “mix” of policy. It looks like he would be much more likely to try and “draw a line” under this unorthodox monetary policy experiment by bringing QE to a conclusion. This will not be a “shock and awe” change but rather a gradual wind down of purchases and eventually the Fed balance sheet through the maturity schedule.(We believe this could happen irrespective of the economic backdrop)

What would this mean?

If, as we believe, we have some potentially significant headwinds coming in markets and the economy then this is going to “throw the ball” right back into the “arms of Congress”. (Is Larry Summers the 21st century’s Paul Volcker?) If the independent Fed is no longer prepared to expand monetary policy “ad infinitum” to support the economy and the economy is slowing what will Congress have no choice but to do???? Stimulate again through fiscal policy.This will mean deficits once again widening and the debt limit rising. It will be a shift back not to tight but to “less loose” monetary policy and looser fiscal policy (This will also likely benefit the USD)

That is why the chart below remains one of our favourites.

Gold and the US Debt Limit

It is no coincidence in our mind that these two have expanded together over the last 10-12 years

As we continue to spend more than we earn and shift that liability to the next generation Gold has shown itself to be a very effective hedge against that policy. The recent “squeeze in Gold” has sent it significant below this “stairway to hell” chart (Debt limit) which has continued higher. As we said earlier, we do not believe that this fall in Gold will be sustainable and expect new highs in the trend eventually. As we also said above , we have retained a long term target of about $3500 for some time on this Gold price based on a comparison of this period and that seen in the 1970’s

As we headed towards the last Presidential election there was a considered view in the markets that by the end of President Obama’s 2nd term the debt limit could be as high as $22 trillion. Then we got the sequester, a more rosy economic outlook, tapering talk and all this has been forgotten. For how long?

The market dynamics above combined with the change of leadership at the Fed may well be “resurrecting that thought”. If so our 2nd favourite Gold chart comes into play.

Gold and the US debt limit (Again): So what would a debt limit of $22 trillion over the next 2-3 years suggest for the Gold price?

How about $3,500

We firmly believe that the Gold correction has “run its course” and that much higher levels will be seen in the years ahead."

Gold Short Squeeze: "Hello Scotia Mocatta, It's JPMorgan... Yes, Again... We Need More Gold" GLD

  

  Zero Hedge reports on ongoing trouble at JP Morgan with Gold deliveries depleting JPM Gold Vaults to the historic lows. We guess that with numerous ongoing investigations to participate in the Gold manipulations is harder and harder...unless it is authorised by the FED or those in control of the U.S. government.

  Jim Sinclair has his interesting take on JP Morgan situation:

Gold Break Out: Jim Sinclair - The three entities that called the $1900 in gold are back long. GLD, SLV, GDX, MUX, TNR.v

"8. The reason that major Bankster’s physical precious metals storage facilities are for sale is one of the strongest reasons that the old high in the gold price will be beaten. They are not for sale because business is bad. The reason to have a depository was to manufacture a synthetic short in gold legally by taking funds for physical but trading the COMEX and OTC derivative gold market to fulfill the appearance of covering their obligations.

This game was not high risk as long as paper gold had full control of the gold price determination. They could have $1000 losses on the short and turn it into a profit via spread trading using the warehouse as plausible denial from manipulation. The banksters, now the major longs, do not select to play this game anymore. The manipulation now favors the bullish side of the gold price.

9. Now the banksters are on your side as you can easily see in the press session trading internationally."

ZeroHedge: "Hello Scotia Mocatta, This Is JPMorgan - We Urgently Need Some Of Your Gold"

"The Great Gold Game of Musical Chairs has begun, ZeroHedge reports on dramatic gold shortages unveiling behind the scenes. We are putting all these pieces of the puzzle together here and the picture is becoming more and more clear - Mother of Shorts Squeeze is coming to the Gold market."

Matt Taibbi: Is JPMorgan Too Big To Chase? Will The Gold Market Manipulation Be Exposed Next?

"Now these Jamie Dimon's cufflinks explain everything. "Brothers" and Gold Manipulation - anyone?"

Playback: Glenn Beck Exposes the Private FED; Gets Fired by Fox

"C.S. It is not the new video, but Glenn Beck is a very good showman to show the dramatic complications surrounding privately owned Federal Reserve. With President Obama now "close to his decision"  on the new Chairman for the FED, the clear understanding of this organisation will help us all to survive the "Taper of QE"."

ZeroHedge:

"Hello Scotia Mocatta, It's JPMorgan... Yes, Again... We Need More Gold"

It happened again.

And like the last time JPM plundered 20K ounces of Scotia gold on August 8...

... JPM took directly from Scotia's registered gold inventory. We wonder how regular, non-TBTF customers of Scotia would feel if they learned that their registered gold was now in the "possession" of JPMorgan.

Finally, as a reminder, JPM's sequestering of all available Comex gold is not new.  It started on August 7 HSBC:

And culminated on August 12 with the great Comex Color-Coded Crunch:

In brief: it continues."

Grant Williams: Understanding Gold - The Gold Price Is NOT The Price of Gold!

  Zero Hedge brings us the brilliant presentation from Grant Williams. This is the video which you should watch and share with everybody. Whether you are the professional trader, investor or just wondering what is going on with the economy, markets and Core Values - you can find the answers here.

 ZeroHedge: 

Grant Williams: "Do The Math!"

"In a masterclass of what is 'really' going on in the world (as opposed to what we are told/spoon-fed on a daily basis), Grant Williams (of Things That Make You Go Hhhmm infamy) provides a must-watch presentation. Starting from the premise (unusual in this day and age) that the laws of mathematics are inviolable ("if it makes no sense, it is nonsense"), the Aussie investment manager sets out his own set of philosophical 'problems' that the world of 'markets' seems incapable of grasping. In a chart-filled extravaganza, Williams ranges from "Problem 1: If the global economy is stalling, Europe is in recession, China is slowing and growth is seemingly impossible to generate, what are equity markets doing at all-time highs?" to "Problem 7: The Gold Price and The Price of Gold are mutually exclusive" leaving the participant questioning everything Bob Pisani would have us believe warning in conclusion that gold is critical and "beware suppressed volatility."

The Coming Great Gold Short Squeeze And The Fiat End-Game

"Recent attack on Gold to preserve the US Dollar Reserve Currency Status Quo has unleashed unprecedented demand for physical Gold. Major banks are defaulting on Gold delivery and premiums for physical Gold and Silver are sky high now. We are in the uncharted territory with COMEX Gold Shorts at the all time high as of now. How the markets can sustain levitation without FED QE Drugs supply we already know: even the thought about the Tapering is unbearable."