Russia’s Gokhran Buying Gold Bullion In 2014 and Will Buy Palladium In 2015

Russia’s Gokhran Buying Gold Bullion In 2014 and Will Buy Palladium In 2015

Gokhran, the Russian precious metals and gems repository, said it has been buying gold bullion in 2014 and will likely to start buying palladium bullion in 2015, Interfax news agency reported this morning, citing the head of Gokhran, Andrey Yurin.


GOKHRAN, Russian State Precious Metals and Gems Repository

Gokhran has been buying gold bullion on the Russian market this year and has no plans to sell palladium from stock in 2014 , Yurin said.  

Gokhran’s palladium reserves are a state secret and analysts try to guess the level each year but they are widely believed to have been depleted according to Reuters.

Gokhran was influential on global platinum group metals (PGMs) markets in the 1990s and 2000s, when its palladium stocks, accumulated during the 1970s and 1980s, came to the market, depressing prices.


Gokhran is the State Precious Metals and Gems Repository which is a state institution under the Russian Ministry of Finance. It is responsible for the State Fund of Precious Metals and Precious Stones of the Russian Federation. It is responsible for the purchase, storage, sale and use of precious metals, precious stones, jewellery, rocks, and minerals by the State Fund.




Russia again added to its growing and increasingly substantial gold reserves in August, with the Russian central bank purchasing  232,510 ozs (7.23 tonnes) and bringing its total gold reserves to 35.769 million ozs or 1,112.5 tonnes.

Likewise, the National Bank of Kazakhstan purchased a very large 795,213 ozs or 24.7 tonnes in August bringing its total gold reserves to 5.848 million ozs (181.9 tonnes).



Palladium is already in a structural deficit and this new source of demand should result in palladium continuing to see gains in the coming months.


MARKET UPDATE

Today’s AM fix was USD 1,217.75, EUR 955.71 and GBP 750.54 per ounce.

Friday’s AM fix was USD 1,222.25, EUR 958.70 and GBP 749.11 per ounce.


Gold fell $3.50 or 0.29% to $1,217.50 per ounce and silver climbed $0.11 or 0.63% to $17.63 per ounce Friday. Gold and silver were both down on the week at 0.01% and 1.51% respectively.

Gold in Singapore was essentially flat, trading around the $1,219/oz level and remained tethered to this level in London trading. Palladium gained about 1% while silver and platinum were largely unchanged.

The dollar hit a four year peak against a basket of currencies this morning and this is pressuring the precious metals.


Gold Down 5.2% In September and Headed For Quarterly Loss Of Over 8%
September has been a poor month for precious metals. Gold is down 5.2%, despite it being gold’s strongest month from a seasonal perspective. The price fall means that gold is heading for the first quarterly loss this year.

Silver has fallen by a larger amount and is down 9.6%. While platinum is 8.3% lower.

Palladium’s 12.7% drop this month means that it is on track for its worst monthly performance since September 2011. It remains higher for the year and is 12.5% higher than the low in January 2014 at $693/oz.

Demand for physical gold could be affected by the Chinese holiday period that begins this week, MKS note this morning.

“Beginning on Wednesday this week we have Chinese Golden Week commencing, which will keep Chinese markets shut between 1-8 October,” it said. “Given the natural support derived from Chinese physical demand, their absence over this period, combined with another strong payrolls figure expected this Friday, could heap added pressure on the gold. This is a very similar scenario to last year where gold was aggressively sold by speculators during the absence of the Chinese.”


Gold in USD – 5 Years (Thomson Reuters)

Canny buyers  in Asia and globally will use further price weakness to dollar cost average into gold.


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War Letters Collector on the Individual Cost of Battle

“We as civilians—who elect certain leaders and rally behind a
war—have an obligation to understand what we’re asking [the troops
to give up] and I hope that these letters do that,” says Andrew
Carroll, a Washington, D.C., based historian. Carroll has devoted
the past 16 years to collecting and preserving war correspondences
throughout American history.

Carroll sat down with Reason TV to reveal the importance of his
project and how he hopes it shapes America’s attitude toward war in
the future. 

View this article.

from Hit & Run http://reason.com/blog/2014/09/29/war-letters-collector-on-the-individual
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Chinese Government Working Overtime to Censor News, Views of Hong Kong Demonstrations

Cellphone protests in Hong KongProtests that began last week in Hong Kong over
Beijing’s decision to vet all candidates for a 2017 election for
chief administrator have turned into some of the largest
demonstrations Hong Kong has seen. The growing protests are thanks
in part to a disproportionate response from local police in Hong
Kong, who fired tear gas at protesters in an attempt to disperse
them. Over the weekend demonstrators took to the streets
surrounding government buildings as part of the campaign of

mass civil disobedience
“Occupy Central” activists
promised.

So far, the Chinese government has officially insisted it had
confidence in Hong Kong’s ability to police the protests itself.
But it’s busy censoring news of the protests on the mainland, which
in 2014 includes a slew of social media and communication apps that
have become popular in China and Hong Kong, as well as disrupting
mobile networks and conducting surveillance on the island.


Reuters reports
:

The intervention is beyond what is normal for the usually
free-talking Hong Kong, even as people are used to Chinese censors
scrubbing the Internet in the mainland when mass demonstrations
erupt.

On Sunday, users reported that Facebook Inc’s photo sharing app
Instagram was inaccessible on China’s mainland.

Chinese websites, including Baidu Inc’s search engine and the
Twitter-like Weibo Corp microblog, have set about deleting
references to the Hong Kong demonstrations.

Others have reported messages on Tencent Holdings Ltd’s hugely
popular WeChat messaging app being removed.

“I think it is still quite safe except WeChat, which is China,”
said Oscar, a 21-year-old student at Hong Kong’s Polytechnic
University, who uses Facebook and WhatsApp to communicate and plan
with other protesters.

“It depends on your phone, because some China (brand) phones,
they can detect your messages,” he said.

The Chinese government’s attempt to censor news of the protests
extends to all opinons, something that appears to frighten even
some pro-government activists in China:

“WeChat is not blocked, I think some stuff is being deleted,”
said Jennie, who, after growing up in mainland China and being
educated in the United States, now runs a Hong Kong-based
charity.

“I forwarded an article (on Hong Kong) on today and it was
deleted. The mainland should think it’s good people are expressing
ideas on behalf of the mainland government, but they even deleted
that. Basically they’re preventing the opportunity for dialogue,
which if you think about it is quite scary.”

The Chinese government may not be able to prevent its citizens
from knowing about protests in Hong Kong, but it can try to keep
them from thinking about it. The last word in the Reuters article,
from the pro-government activist:

“All my friends … know what’s happening in Hong Kong,” said
Jennie in Hong Kong. “They’re tweeting from Weibo and WeChat and
forwarding articles. Not expressing personal views, but there are
articles being forwarded.”

At the same time, Chinese authorities ordered all websites to
“immediately clear away information about Hong Kong students
violently assaulting the government and about ‘Occupy Central’,”
according to China Digital Times, another censorship watchdog.

“My dad saw an article discussion I forwarded on the ‘deeper’
issues causing the current situation, and he replied: ‘Oh it’s been
deleted’,” said Jennie. “And that’s it, he didn’t seem to be
bothered by it.”

Across the country, China had about
500 protests a da
y in 2012, but even when governemnt buildings
are taken over protesters express support for the Communist
Party.

from Hit & Run http://reason.com/blog/2014/09/29/chinese-government-working-overtime-to-c
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The Left/Right Alliance That Legalized Homeschooling

NPR’s Sanjena Sathian
looks back
at the left/right coalition that brought
homeschooling out from under a legal cloud. The left wing of the
alliance featured fans of John Holt and
other radical critics of institutionalized education; the right
wing reflected Christian conservative concerns. Those worldviews
may have been far apart (though inevitably, people managed to

combine them
), but the different groups managed to work
together:

I suspect she actually said Taoism, not Zen Buddhism, but who know?Fast-forward to the 1980s, when
left met right. [Home School Legal Defense Association founder
Michael] Farris found himself defending a hodgepodge of
home-schoolers/unschoolers throughout the decade, mostly Christians
like him and his family, but also “black Jews, Muslims…even one
woman who told me her religious practices were a cross between Zen
Buddhism and the philosophy of Winnie the Pooh.”

States got creative, defending compulsory school attendance laws by
leveraging truancy and even child abuse charges against
home-schooling parents, and lawyers like Farris rose to the top of
a booming individual rights movement.

Farris and other lawyers fought to change the
definition of a private school
to include home schooling; they
combated truancy charges aplenty and faced down the dictum that
students should only be taught by certified teachers. But mostly
they won the courts’ silence, as judges refused to rule on the
inherent value of home schooling and instead considered it from a
rights perspective. That, in itself, was victory.

Today, most of the nearly 2 million home-schooled kids are probably
still seen as
fringe
—but the idea of criminalizing parents for teaching kids
at home? Equally fringe.

Sathian wraps up by contrasting those “1980s debates that could
unite two opposing value systems under the shared umbrella of a
libertarian ideal” with “today’s deeply personal and political
battles” over issues like Common Core. But I wouldn’t rush to
consign the left/right education alliance to the nostalgia pit just
yet. Both the Christian right and the John Holt left object
strongly to Common Core, and lately they’ve been joined by many

voices
within the
teachers unions
, which certainly wasn’t the case with the
homeschooling battles. Unity at last!

[Via Ralph
Nader
.]

from Hit & Run http://reason.com/blog/2014/09/29/the-leftright-alliance-that-legalized-ho
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ISIS Fighter: U.S. Airstrikes in Syria Aren’t Stopping Us

Last week the U.S. began
conducting airstrikes in Syria as part of its war against the
Islamic State (a.k.a. ISIS or ISIL). The Obama administration is
deliberately hitting oil fields under ISIS control in order to hit
them in the moneymaker. American military leaders were quick to
say, “The
strikes were successful
.”

An ISIS fighter under the pseudonym Abu Talha
tells
CNN that’s a lot of hot air:

We’ve been ready for this for some time. … We know that our
bases are known because they’re tracking us with radars and
satellites, so we had backup locations. …

We have revenues other than oil. We have other avenues, and our
finances are not going to stop just because of oil losses. …

They thought they knew everything. But thank God, they don’t
know anything. And God willing, we will defeat the infidels.

They hit us in some areas, and we advance in other. … If we are
pushed back in Iraq, we advance in northern Syria. These strikes
cannot stop us, our support or our fighters

Can we take his word for it? If not, the former head of the
U.K.’s military
also says
that airstrikes aren’t going to work.

President Barack Obama acknowledged yesterday that his
administration has “underestimated
the Islamic State.

America’s bombing campaign could cost as much as
$10 billion a year
, according to Foreign Affairs.

Several foreign policy voices have
said
American airstrikes run the serious risk of
bringing together
ISIS with other anti-American jihadists while
angering moderate rebels that have previously been pro-U.S.

Reuters
reports
today that “U.S.-led air strikes hit grain silos and
other targets in Islamic State-controlled territory in northern and
eastern Syria overnight, killing civilians and wounding
militants.”

As Reason‘s Peter Suderman highlights, despite Obama’s
insistence that he won’t get America tangled up in a ground war,
the
vast majority
of Americans believe the fight against ISIS will
expand beyond airstrikes to include ground troops. 

from Hit & Run http://reason.com/blog/2014/09/29/isis-fighter-us-airstrikes-in-syria-aren
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Afghanistan to Agree to 10,000 U.S. Troops in Country Past 2014

Ashraf GhaniThe newly inaugurated president of Afghanistan,
Ashraf Ghani, is
expected
to sign a security deal tomorrow that will allow
10,000 U.S. troops to remain in Afghanistan after the international
operation officially finishes at the end of the year.

Nevertheless, Ghani is
also interested
in restarting negotiations with the Taliban,
which claimed responsibility for a suicide bombing near the Kabul
airport, and other militant groups in the country. “Fighting is not
the solution to the political differences,”the new president said
at his inauguration. “We proved that political differences can be
solved through political negotiations. Therefore I call upon the
opponents of the government – especially the Taliban and
Hezb-e-Islami to join political talks.”

Ghani’s electoral rival, Abdullhah Abdullah, who
also supported extending
the U.S. mission in Afghanistan, was
also sworn in as a “chief executive,” part of a power-sharing deal
after the disputed election.

Former President Hamid Karzai, who left office today, and

refused to sign
a security deal with the U.S. as a lame duck,

used his farewell speech
last week to lambast the U.S.,
claiming “America did not want peace for Afghanistan, because it
had its own agendas and goals here,” mainly the “personal interest
of the foreign policies of others.”

from Hit & Run http://reason.com/blog/2014/09/29/afghanistan-to-agree-to-10000-us-troops
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A. Barton Hinkle on Partisan Hackery and the Virginia Senate Race

Virginians who will vote in November’s Senate
race have a choice between two hopelessly partisan hacks, say the
candidates themselves. The Republican challenger, Ed Gillespie,
constantly accuses incumbent Democrat Mark R. Warner of marching in
lock step with President Barack Obama and Senate Majority Leader
Harry Reid. By way of rebuttal, Warner says things like this:
Gillespie “comes from a world where it’s all about partisanship,
one team versus another team. If there’s ever a time where you have
to check your Republican and Democrat hats and put our country
first, it’s now.” A. Barton Hinkle says it’s time to drop the
partisan hackery.

View this article.

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Brazil Crashes As Rousseff Regains Lead

Having rallied exuberantly on the back of hopes a reform-hungry hot-money-flow-encouraging Silva would take the Presidency in Brazil, a new poll this morning shows encumbent Rousseff back in the lead… and Brazilian markets are rapidly unwinding their exuberance. The Ibovespa is down 5% – its biggest drop in over 3 years. Brazil swap rates have spiked over 50bps and bonds bleeding as USDBRL jumps over 3 handles (to weakest since 2008). It appears just 48 hours after a strong rally on Friday, as markets ‘efficiently’ knew everything was great, Rousseff has realised a few well-placed, well-executed poll results and everything changes.

 

As Bloomberg reports,

Datafolha poll late Friday showing President Rousseff lead widening before Oct. 5 elections and amid broad USD strengthening.

 

Rousseff 4ppt ahead of Silva in runoff, up 2ppt vs previous poll; lead widens to 13ppt from 7ppt in 1st round: Datafolha

 

Record TV channel may release new Vox Populi poll, taken Sept. 27-28; last Vox poll showing Rousseff lead narrowing contrasts with Datafolha results

 

New polls from Datafolha and Ibope expected from tomorrow 

And this happens…

 

Individual stocks are getting crushed:

  • *PETROBRAS FALLS 9.2% IN SAO PAULO TRADING
  • *PETROBRAS EXTENDS DECLINE, FALLS MOST SINCE NOV. 2008
  • *BANCO DO BRASIL SHARES FALL 8.3% TO BRL27.35 IN SAO PAULO
  • *CYRELA FALLS 5.1% IN SAO PAULO TRADING




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Stocks Tumble; High-Yield Credit Risk Spikes To 1-Year Highs

It appears the post-PIMCO-effect is not wearing off. Having had a weekend to soak up the reality of what outflows will mean for Gross’ old shop, credit markets are once again flashing bright red this morning as managers reach for protection ahead of expected redemptions which would force selling into an illiquid market. High-yield spreads are 25bps wider at their highest since early Oct 2013. Equity futures are legging lower with the weakness.

 

 

Which is dragging stocks lower…

 

Bigger picture, things have rolled over quickly..

 

and for those who defend the ongoing equity exuberance of the S&P by noting that their buyback-funding is investment grade backed and high-yield is in trouble due to liquidity and technicals… think again…. the entire corporate bond market is turmoiling…

 

Charts: Bloomberg




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China Finally Speaks On Hong Kong Protest: "Opposes Illegal, Destabilizing Activities"

With the biggest Hong Kong protest in recent history taking place over the weekend, and continuing indefinitely because one thing is certain: the local student demands for more democracy and the ouster of HK chief executive CY Leung will not be met, what everyone has focused on is what China’s response, call it crackdown, to the breakout of violence will be. After all, while algos and the Fed’s liquidity tsunami have priced in pretty much everything short of (or including, according to some) World War III, a repeat of Tiananmen square could well be large enough to where it registers as a slight downtick in the Fed’s balance sheet, pardon the S&P 500.

Hong Kong Chief Executive CY Leung

So for all those eager to track the progression of China’s responses to the protests, here is the first official statement via CRIEnglish:

China’s central government is describing the so-called Occupy Central movement in Hong Kong as an “illegal gathering.”

 

At the same time, mainland authorities say they’re confident authorities in Hong Kong are able to handle it.

 

The Occupy group in Hong Kong is opposed to the new plans for universal suffrage in the city.

 

Hong Kong Chief Executive CY Leung says the Hong Kong government considers the Occupy movement illegal.

 

At the same time, Leung says his government plans to continue moving forward with the consultation process.

 

“And in so far as consultations and the question of constitutional development is concerned, it is also important to bear in mind that we have to operate within the framework of the stipulations of the Basic Law and the National People’s Congress Standing Committee’s decisions because these are the legal and constitutional frameworks for Hong Kong’s constitutional developments to go forward in.”

 

Protests this weekend in Hong Kong turned ugly, with police being forced to use tear-gas to disperse demonstrators who were trying to push through police lines.

For now China is merely escalating the verbal rhetoric, and is hoping that the student will get bored and go home. Which they won’t. So what happens then? Well, the following post should provide some insight…




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