Category: zerohedge

Today’s AM fix was USD 1,281.75, EUR 953.99 and GBP 797.65 per ounce.
Yesterday’s AM fix was USD 1,266.00, EUR 951.25 and GBP 798.75 per ounce.

Gold rose $14.40 or 1.13% yesterday, closing at $1,294.07/oz. Silver hit a high $20.90 and closed the day with a gain of $0.25 closing at $20.81.

Click here for this month’s Insight ‘Talking Real Money: World Monetary Reform’

Yesterday, the World Gold Council released its Gold Demand Trends 2013 Report which demonstrates quite clearly that the Chinese continue to accumulate gold; gold continues to flow east to both government and consumer channels. The report also showed that central banks continue to accumulate and there is positive news that jewellery trade is up.

Key findings:

Continued consumer growth in China. 
Total consumer demand was 210t in Q3 2013, a rise of 18% compared to the same period last year.

Central banks continue to be strong buyers of gold, albeit at a slower rate.
Q3 2013 was the 11th consecutive quarter of net purchases of gold.

Jewellery consumption in South East Asia, outside China, was also strong.
Hong Kong was up 28%, Vietnam up 14%, Thailand up 57% and Indonesia up 19% on the same quarter last year albeit off low bases.

Government regulations in India are dampening demand figures.
India recorded a 32% decline in consumer demand compared to the same quarter last year. However year to date, demand remains robust, up 19% compared to the first three quarters of 2012, following the surge in demand sparked by two price falls earlier in 2013.

Francis Bacon’s ‘Three Studies of Lucian Freud’

In another vote of confidence in the world of art, a triptych by Francis Bacon, titled ‘Three Studies of Lucian Freud,’ sold for €105 million ($142 million), a world record price for a painting.

However, Felix Salmon at Reuters believes that there is a speculative play in place and there is a number of people selling big-ticket contemporary art works at auction who have only owned these pieces for a short time and this is a key indicator that there is flipping in the market.

Salmon opines that there is signs of a speculative bubble, one that has been going on for years, even through the darkest hours of the financial crisis but that this latest burst of record selling prices could be the tipping point.

The price was pushed up by €44 million ($60 million) more than the auction house had estimated it would sell for. Believe it or not, but the price was decided after just ten minutes of bidding. This price smashes the previous record set when ‘The Scream’ by Edvard Munch sold for €89 million ($120 million.)

The auction also set a record for the highest amount ever made at one auction with €687 million (€511 million) worth of paintings were sold and included artists such as Andy Warhol, Jackson Pollock, Roy Lichtenstein and Mark Rothko.

Lucian Freud, who died in 2011, was also the subject of a second full-length Bacon triptych, painted in 1966. That work, however, is missing.

Whilst owning a Francis Bacon painting is out of the reach for most people, you can visit his studio where all these ‘expensive’ paintings were created. In keeping with the aura that surrounds Bacon’s life, his studio and its entire contents were moved from London to Dublin in 1998, and is on display in the Hugh Lane Galleryin Parnell Square, Dublin.

The Hugh Lane Gallery has its own amazing story in that Sir Hugh Percy Lane, its founder, died on board the RMS Lusitania in 1915 when she was torpedoed and sunk by a German U-boat.

No trip to Dublin is complete unless you visit this stunning exhibition; Bacon’s studio is a revelation and you can marvel at how three pieces of Bacon were sold for an incredible €105 million or 3.78 tons of gold at today’s price of €953/oz.

Click here for this month’s Insight ‘Talking Real Money: World Monetary Reform’

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via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/z_UxQVvNSYc/story01.htm GoldCore

Spain’s public debt climbed sharply in September to a new record high of 954.863 billion euros, casting doubt about the government’s ability to meet its target for the end of the year. Even finance minister Cristobal Montoro acknowledged that “there are concerns about the pace of the increase,” adding that this meant bringing down the public deficit even more of a priority. As El Pais reports, according to figures released Friday by the Bank of Spain, the state’s outstanding obligations climbed 10.181 billion euros in the month from August to a level equivalent to 93.4 percent of GDP. The government’s target for the full year is 94.2 percent, a figure that has already been revised upward. The central bank estimated GDP in the 12 months to September at 1.022 trillion euros.

 

But, apart from that, Spanish bond spreads near pre-crisis lows…

 

Yep – makes perfect sense…

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/ZRPM6b7U3i0/story01.htm Tyler Durden

Spain’s public debt climbed sharply in September to a new record high of 954.863 billion euros, casting doubt about the government’s ability to meet its target for the end of the year. Even finance minister Cristobal Montoro acknowledged that “there are concerns about the pace of the increase,” adding that this meant bringing down the public deficit even more of a priority. As El Pais reports, according to figures released Friday by the Bank of Spain, the state’s outstanding obligations climbed 10.181 billion euros in the month from August to a level equivalent to 93.4 percent of GDP. The government’s target for the full year is 94.2 percent, a figure that has already been revised upward. The central bank estimated GDP in the 12 months to September at 1.022 trillion euros.

 

But, apart from that, Spanish bond spreads near pre-crisis lows…

 

Yep – makes perfect sense…

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/ZRPM6b7U3i0/story01.htm Tyler Durden

Despite Janet Yellen’s commitment to continue supporting the economic recovery the transmission system of government interventions is clearly broken. As STA Wealth Management’s Lance Roberts shows in the simple chart below, it has taken $35.17 of government intervention to generate $1 of economic growth over the past 5 years. More importantly, the rate of diminishing returns is increasing. In other words, it is taking consistently more dollars of intervention to create an incremental increase in economic growth.

 

 

In the meantime, as shown below, the continued liquidity programs from the Federal Reserve continue to boost asset markets towards more exuberant levels.

 

However, despite signs of a potential market “bubble” Janet Yellen clearly sees no such thing…

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/pmUU01Tr3gM/story01.htm Tyler Durden

Despite Janet Yellen’s commitment to continue supporting the economic recovery the transmission system of government interventions is clearly broken. As STA Wealth Management’s Lance Roberts shows in the simple chart below, it has taken $35.17 of government intervention to generate $1 of economic growth over the past 5 years. More importantly, the rate of diminishing returns is increasing. In other words, it is taking consistently more dollars of intervention to create an incremental increase in economic growth.

 

 

In the meantime, as shown below, the continued liquidity programs from the Federal Reserve continue to boost asset markets towards more exuberant levels.

 

However, despite signs of a potential market “bubble” Janet Yellen clearly sees no such thing…

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/pmUU01Tr3gM/story01.htm Tyler Durden

.

 

 

 

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/VjEDbFAfKVo/story01.htm williambanzai7

 

Source: The Onion

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Source: The Onion

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/7qm7wrj_wSc/story01.htm Tyler Durden

While hardly as dramatic as ongoing revelations of Big NSA Brother probing every aspect of Americans’ lives, overnight the WSJ reported that in addition to the complete loss of privacy – which should now be taken for granted – the CIA has been added to the list of entities that scrutinize every online interaction, and is “building a vast database of international money transfers, including Western Union, that includes millions of Americans’ financial and personal data, officials familiar with the program say.” The program will be (and is) carried out under the same provision of the Patriot Act that enables the National Security Agency to collect nearly all American phone records. In other words, instead of being upfront that all the CIA, and administration, care about is tracking large flows of money that may have “evaded” taxation, and is traditionally used by expats to send modest amounts of money back to their host countries, what the CIA is instead focusing on is whether mom and pop are using Western Union to deposit $500 in Al-Qaeda’s account in Afghanistan.

The WSJ explains as much:

The data is obtained from companies in bulk, then placed in a dedicated database. Then, court-ordered rules are applied to “minimize,” or mask, the information about people in the U.S. unless that information is deemed to be of foreign-intelligence interest, a former U.S. official said.

 

A limited number of analysts are allowed to search the database with queries that meet court-approved standards. This is similar to the way NSA handles its phone-data program.

 

…

 

The CIA, as a foreign-intelligence agency, is barred from targeting Americans in its intelligence collection. But it can conduct domestic operations for foreign intelligence purposes. The CIA program is meant to fill what U.S. officials see as an important gap in their ability to track terrorist financing world-wide, current and former U.S. officials said.

 

The program serves as the latest example of blurred lines between foreign and domestic intelligence as technology globalizes many activities carried out by citizens and terrorists alike. The CIA program also demonstrates how other U.S. spy agencies, aside from the NSA, are using the same legal authority to collect data such as details of financial transactions.

Ah yes, “limited number.” And since every single American is a potential sponsor of terrorism, it is only logical that this latest dragnet covers absolutely every single US citizen. And in the outlier case that the CIA also taps, investigates, records, and just happens to forward to the IRS, every single money transfer originating or terminating in the US, oh well.

The data collected by the CIA doesn’t include any transactions that are solely domestic, and the majority of records collected are solely foreign, but they include those to and from the U.S., as well. In some cases, it does include data beyond basic financial records, such as U.S. Social Security numbers, which can be used to tie the financial activity to a specific person. That has raised concerns among some lawmakers who learned about the program this summer, according to officials briefed on the matter.

What is peculiar is that unlike wire transfers which are virtually unlimited in size, and scrutinized by all relevant, and irrelevant, authorities money transfers are for the most part tiny and anything that is of a more sizable amount, over $3000, is already subject to the microscope treatment:

Money transfer forms differ depending on location and type. But they ask for the names, addresses and telephone numbers of senders and receivers. Depending on the transfer, senders and receivers also may be asked to provide the date and place of their birth. In most locations in the U.S., people sending $1,000 or more must provide an ID such as a driver’s license. People sending $3,000 or more must provide additional ID, such as a Social Security number or passport.

However, it appears the small transfer limit did not trouble Al-Qaeda:

The money-transfer program appears to have been inspired by details of the Sept. 11, 2001, terrorist plot, in which the al Qaeda hijackers were able to move about $300,000 to U.S.-based bank accounts without arousing suspicion. In part, it was because the transactions were comparably small and fit the pattern of the remittances used by immigrants or foreign visitors to send money home.

 

Some of the transfers were between bank accounts, but some moved through person-to-person transfers. In 2000, Sept. 11 plot facilitator Ramzi Binalshibh made a series of transfers, totaling more than $10,000, from Germany to the U.S., where they were collected by hijacker Marwan al-Shehhi. Two transfers were through MoneyGram and two through Western Union.

And while hardly as dramatic in the grand scheme of things, the WSJ report shows just how much, or little, personal privacy hinges on one simple word:

That program was institutionalized by 2006 and continues under a controversial authority tucked into a part of the Patriot Act known as Section 215. That law permits the government to obtain “tangible things,” including records, as long as the government shows it is reasonable to believe they are “relevant” to a terrorism investigation.

 

Under that provision, the U.S. government secretly interpreted the term “relevant” to permit collection of records on millions of people not necessarily under suspicion. That secret interpretation, used to justify the legality of the phone-records program, was brought to light in the wake of the revelations by former NSA contractor Edward Snowden.

 

The interpretation also was used by CIA as the legal underpinning of its bulk financial-records effort under the money-transfer program, officials said.

One doesn’t need to clarify that just like with the NSA, the CIA is logging, recording and analyzing every single money transfer of even the most nominal amount. Which, quite simply, continues to build an architecture for the full tracing of all electronic monetary transactions in the US. Because once every flow of funds is logged at even the most micro level, the US will be able to not only regulate and supervise, but to implement any type of capital and fund flow controls it desires. Which it will in due course.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/QjCmB2dRDKE/story01.htm Tyler Durden

Twitter’s stock price is not happy. The unleashing of Twitter options this morning appears to have created a need to sell the underlying (after yesterday’s exuberant pre-options jump). Over 1 million lots (100 million shares) have changed hands already in Twitter across all maturites but perhaps most notable is the demand. At-the-money implied volatility (an apples-to-apples way of comparing options ‘costs’) is around 50% for a December maturity which compares to 40% for Facebook options of the same maturity. It seems more than a few of the IPO owners are looking to hedge (as puts are notably more “expensive” than calls).

 

• FB Dec Calls 39.75%, Puts 39.92%
• TWTR Dec Calls 49.02%, Puts 50.76%

 

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/c64-824zWjg/story01.htm Tyler Durden