23 July 2016 — Saturday
YESTERDAY in GOLD, SILVER, PLATINUM and PALLDIUM
Gold hit its high tick in very early trading in the Far East on their Friday morning — and was turned lower after that. Most of the losses were in by 9 a.m. BST in London trading — and it didn’t do much after that, especially after the London p.m. fix was in for the day.
The high and low ticks aren’t worth my effort to look up.
Gold finished the Friday session at $1,323.10 spot, down $7.60 from Thursday’s close. Net volume was a bit over 140,000 contracts — and roll-over activity out of the August contract was very heavy.
The silver price chopped higher until shortly before 10 a.m. Hong Kong/Shanghai time on their Friday morning and, like gold, was sold down until 9 a.m. in London. The price didn’t do much until the noon silver fix was in — and then rallied a dime or so in the ensuing hour. That got capped and sold down shortly before 1 p.m. BST. It was sold lower until shortly after 9 a.m. in New York — and then chopped sideways until noon EDT — and then it flat-lined into the close.
The high and low ticks in this precious metal were reported as $20.02 and $19.62 in the September contact. Net volume was just under 42,000 contracts.
Platinum’s high tick came at the same time as gold’s high tick. It got sold off a bit from there until it began heading lower with a vengeance the same time as silver got turned lower in London, which was shortly before 1 p.m. BST. The low tick was printed in the thinly-traded after-hours market — and it rallied a few bucks into the close. Platinum finished the Friday session at $1,082 spot, down 19 bucks from Thursday’s close, giving back all of Thursday’s gains, plus two dollars more in the process.
The palladium price did virtually nothing throughout the entire Friday trading session — and closed down a buck on the day. Nothing to see here.
The dollar index closed very late on Thursday afternoon in New York at 96.95 — and spent all of Far East, plus the first hour or so of London trading, about ten basis points lower than that. Around 9:20 a.m. BST it made it up to the 97.13 level — and traded sideways until the London p.m. gold fix. It rallied sharply form there, with the 96.54 high tick coming around 12:15 p.m. in New York. The index chopped quietly lower from there, closing out the day at 97.34 — up 39 basis points from Thursday’s close.
And here’s the 6-month U.S. dollar index chart, so you can see how the ‘rally’ in the world’s reserve currency is progressing.
The gold stocks opened down about a percent — and made it into positive territory by shortly after 1 p.m. EDT. They peaked out minutes before the COMEX close, before sliding back into negative territory, as the HUI closed down 0.22 percent.
It was somewhat similar share price action in the silver equities, although they were down 2 percent just before noon in New York. Then, like the gold shares, they rallied until just before the COMEX close, but never made it into positive territory. Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed down 0.39 percent. Click to enlarge if necessary.
And here are three charts from Nick that tell all. The first one shows the changes in gold, silver, platinum and palladium for the past week, in both percent and dollar and cents terms, as of Friday’s closes in New York — along with the changes in the HUI and Silver Sentiment/Silver 7 Index. The Click to Enlarge feature really helps on all three charts.
And this chart shows the month-to-date changes as of Friday’s close.
And here’s the year-to-date changes as of the close of trading yesterday.
The CME Daily Delivery Report showed that 54 gold and 20 silver contracts were posted for delivery within the COMEX-approved depositories on Tuesday. In gold, Canada’s Scotiabank issued 50 contracts –and JPMorgan stopped all 54 contracts for its client account. In silver, ABN Amro was the sole short/issuer. JPMorgan stopped 7 for its own account, HSBC USA stopped 7 for itself as well. The link to yesterday’s Issuers and Stoppers Report is here.
The CME Preliminary Report for the Friday trading session showed that gold open interest in July fell by 274 contracts, leaving 100 left — minus the 54 contracts mentioned in the previous paragraph. Thursday’s Daily Delivery Report showed that 323 gold contracts are up for delivery on Monday, so that means that another 323-274=49 gold contracts were added to the July delivery month. Silver o.i. in July declined by 101 contracts, leaving 247 still open. Thursday’s Daily Delivery Report showed that 125 silver contracts were posted for delivery on Monday, so that another 125-101=24 silver contracts were added to the July delivery month.
I have never witnessed such an absolute manic obsession to obtain physical gold and silver through the COMEX futures market, with virtually all of the deliveries revolving around JPMorgan and its ‘client’ in gold. It is unprecedented — and I know that Ted will have lots to say about this in his weekly review today.
There were no changes reported in GLD yesterday — and as of 9:48 p.m. EDT yesterday evening, there were no changed in SLV, either.
There was no sales report from the U.S. Mint yesterday.
Month-to-date the mint has sold 28,000 troy ounces of gold eagles — 8,000 one-ounce 24K gold buffaloes, plus 1,195,000 silver eagles. You’d have have to go back a fair number of years to find a worse month for mint sales, especially silver eagle sales, than this month. Mercifully, I’ve noticed that the nut-ball lunatic fringe has gone silent on over-the-moon silver eagles sales now that they’ve dropped back to almost nothing. If or when JPMorgan shows up again as a buyer, then sales will obviously pick up right away. Until that happens ‘retail sales’ will remain as they’ve been for years — and that’s lousy.
There was very little activity in gold over at the COMEX-approved warehouses yesterday. Only 3,118.550/97 kilobars were reported received — and all those went into Brink’s, Inc. I shan’t bother linking this activity.
There was decent activity in silver, as 596,740 troy ounces were received — and all of that went into CNT. Only 250,011 troy ounces were shipped out — and all of that came out of JPMorgan’s vault. The link to that activity is here.
It was another big day over at the COMEX-approved gold kilobar depositories in Hong Kong on their Thursday. They reported receiving 6,568 of them — and shipped out 5,630. All around, it was a very busy week at Brink’s, Inc. once again — and the link to that action, in troy ounces, is here.
The Commitment of Traders Report for positions held at the close of COMEX trading on Tuesday, was about as expected in gold — but a stunning negative surprise in silver.
In silver, the Commercial net short position increased by an astounding 6,135 contracts, or 30.7 million troy ounces of paper silver. They arrived at this amount by selling 3,656 long contracts, plus they added 2,479 contracts to their already record short position. The sum of those two numbers represents the change in the Commercial net short position for the week, which now stands at 106,255 contracts, or 531 million troy ounces of paper silver sold short.
Looking at the silver chart for the reporting week, there was no hint of this massive blow-out in its short position, because it would have certainly shown up in the price. I was actually expecting a small improvement — and Ted and I were both taken aback by this turn of events. Ted said he would sleep on the numbers — and then write about it in his weekly review later today.
There’s always the possibility of a reporting error, but they are what they are, so here’s the break-down.
The Big 4 traders increased their short position by about 2,300 contracts — and the ‘5 through 8’ large traders added 600 contracts to their record long short position. The raptors, the commercial traders other than the Big 8, added around 3,200 contracts to their short positions as well. Ted pegs JPMorgan’s short position as 32,000 contracts, giving them the entire amount of the Big 4 increase for the reporting week. He will be able to get a better handle on things when the new Bank Participation Report comes out, but that’s two weeks away, which is a lifetime in this market.
Under the hood in the Disaggregated COT Report, it was mostly Managed Money on the other side, as they increased their net long position by 5,285 contracts — and to another new record. They did this by adding 5,969 long contracts, but they also added 684 short contracts — and the difference between those two numbers is the net change for the week. Most of the rest of the changes for the week showed up in the “Other Reportables” category, and only a small amount came from the Nonreportable/small trader category.
Here’s the 9-year chart for the silver COT Report — and it’s as ugly as it’s ever going to get. I said the same thing after last week’s report as well. One of these weeks I’ll get it right! Click to enlarge.
In gold, the Commercial net short position improve by 9,975 contracts, or 997,500 troy ounces of paper gold. They arrived at this number by decreasing their long position by 3,825 contracts, plus they reduced their short position by 13,800 contracts. The difference between those two numbers is the change for the reporting week. The Commercial net short position is now down to 31.55 million troy ounces. An improvement, yes — but still wildly bearish.
Ted said that the Big 4 commercial traders reduced their short position by around 2,300 contracts, the ‘5 through 8’ traders reduced their short positions by about 3,800 contracts — and the small commercial traders, Ted Butler’s raptors, decreased their short positions by 3,900 contracts.
Under the hood in the Disaggregated COT Report, the Managed Money traders accounted for a large chunk of the weekly change in the commercial net short position, but nowhere near all of it. They reduced their net long position by only 6,732 contracts. They arrived at this number by reducing their long position by 8,789 contracts, but they also reduced their short position by 2,057 during the reporting week as well. The net of the those two numbers was the 6,732 contract change. There were big swings in the ‘Other Reportable’ category as they also decreased their net long position to the tune of 4,820 contracts for the reporting week — and the Other Reportable/small traders went in the other direction by adding 1,577 long contracts on a net basis. [6,732+4,820-1,577=9,975] — which is the change in the commercial net short position]
Here’s the 9-year COT chart for gold — and despite the improvement for the second week in a row, the numbers are still ugly. Click to enlarge.
Here’s Nick Laird’s “Days to Cover” chart updated with yesterday’s COT data for positions held at the close of COMEX trading on Tuesday. It shows the days of world production that it would take to cover the short positions of the Big 4 and Big 8 traders in each physically traded commodity on the COMEX. Click to enlarge.
As I say in every Saturday column—the short positions of the Big 4 and 8 traders in silver continues to redefine the meaning of the words ‘obscene’ and ‘grotesque.’ For the current reporting week, the Big 4 are short 166 days [more than five and a half months] of world silver production—and the ‘5 through 8’ traders are short an additional 71 days of world silver production—for a total of 237 days, which is a hair under 8 months of world silver production, or 545 million troy ounces of paper silver held short by the Big 8.
And it should be pointed out here that in the COT Report above, the Commercial net short position in silver is 531 million troy ounces. So the Big 8 hold a short position larger than the net position—and by just about 14 million troy ounces. That’s how grotesque, twisted, obscene—and dangerous—this COT situation in silver has become—and gold and platinum aren’t far behind.
And as an aside, the two largest silver shorts on Planet Earth—JPMorgan and Canada’s Scotiabank—are short about 120 days of world silver production between the two of them—and that 120 days represents around 72 percent [almost three quarters] of the length of the red bar in silver in the above chart. The other two traders in the Big 4 category are short, on average, about 23 days of world silver production apiece.
The Big 8 traders in gold are short 45.9 percent of the entire open interest in the COMEX futures market in gold, plus they are short 45.8 percent of the entire COMEX futures market in silver—and these positions are held against thousands of other traders in these two precious metals who are long the COMEX futures market. Ted pointed out that if you subtract out the market-neutral spread trades in both these precious metals, the Big 8 are actually short a hair more than 50 percent of the total open interest in both metals.
Here’s another chart that Nick passed around yesterday evening. It’s headlined “Annual Transparent Gold Holdings” — and certainly needs no further embellishment from me. Nick’s comments in the covering e-mails stated “Annual flows at all time highs – 24.6 m/oz (766.5 tonnes) worth $30.9 billion.” Click to enlarge.
Here are three more charts that Nick passed around last night. The first one shows the gold imports and exports from Switzerland for the last couple of years — and updated with the June data. Click to enlarge.
These next two charts below show the country that Switzerland imported their gold from in June — and where the final destination was for the gold they exported that month. Click to enlarge helps with both charts.
I don’t have all the many stories for you today — and a few of them are ones that I’ve been saving for today’s column for length and/or content reasons.
CRITICAL READS
More Signs the End Is Nigh
“Every generation suffers its particular fantasies. So it was a century ago. Investors had grown so immune to the consequences of war that bond markets from London to Vienna didn’t flinch after the assassination that provoked World War I.“
“Three weeks later, in the summer of 1914, the fear premium amounted to a total of one basis point. Then, in quick order, European markets ceased to function. A notable feature of this paralysis is that nothing of substance had changed – war had not been declared by any of the parties, but by now, minds were hyperventilating.”
Today’s fantasies are vast and unremitting. Similar to the fantasies of 100 years ago, in hindsight, they’ll be equally absurd. One particularly captivating fantasy at the moment is that the more global central banks inflate their balance sheets the more expectations of inflation decline.
Simple logic seems to have been suspended for the near universal disregard of the rules of common sense in the treatment of the money supply of the world. How long can this possibly persist? Obviously, at some point, this fantasy will be shattered.
For just because central banks have continuously increased their balance sheets in recent years without igniting runaway price inflation doesn’t mean the danger isn’t there. Remember, correlation doesn’t imply causation. But it can imply confusion.
This commentary by M.N. Gordon put in an appearance on David Stockman’s website yesterday — and I thank Roy Stephens for bringing it to my attention. Another link to this article is here.
Former Fed Governor Admits “Fed Is Not Data Dependent; It Is Propping Up Asset Markets“
Earlier this year, Peter Schiff picked up on something few reported on when a former Federal Reserve president admitted the central bank created a phony wealth effect by pumping up stocks and other asset markets through its monetary policy. Several months later, analysis proved this was true, showing that 93% of the entire stock market move since 2008 was caused by Federal Reserve policy.
Today, the Fed continues to focus on propping up asset markets. Even a former Federal Reserve governor admits this is the case. Kevin Warsh appeared CNBC’s Squawk Box on Thursday and said the Fed isn’t really “data dependent” in the sense that it is looking at the overall economy. It is really market dependent.
“They look to me asset price dependent more than they look data dependent. When the stock market falls like it did in the beginning of this year, they say, ‘Oh, we better not do anything.’ Stock markets are now at career highs. I suspect when they meet over the course of the next 10 days they will suggest, ‘Oh, now they look like they can be somewhat more responsible.’ I don’t like changing policy meeting to meeting based on data, or even with what the S&P 500 is doing. I like making it based on what’s happening on the real side of the economy, and that has not been very convenient over the last six to nine months.”
This item was posted on the Zero Hedge website at 3:50 p.m. on Friday afternoon EDT — and I thank Chris Powell for passing it around yesterday. It certainly worth reading — and another link to this story is here.
Investors Are Getting Ripped Off on Index Fund Fees, Lawsuits Say
Index funds often benefit from a low-cost halo. They don’t all deserve to bask in that glow.
Allegations of excessive index fund fees in retirement plans are at the heart of a new proposed class action lawsuit brought by New York Life Insurance Co. employees against the company. The case, filed in U.S. District Court for the Southern District of New York, alleges breach of fiduciary duty under the Employee Retirement Income Security Act.
The lawsuit is part of a new wave of 401(k) suits against smaller plans. One of the New York Life plans has $600 million in assets, while the other has $2.5 billion. Earlier this month, Minneapolis-based law firm Nichols Kaster filed suits against American Century’s $600 million plan and the $1.3 billion plan at Fujitsu Technology and Business of America, Inc.
A lot of mutual fund pruning and rejiggering has gone on in the 401(k) world in the wake of high-profile lawsuits, which often involved allegations of excessive fees and resulted in multi-million-dollar settlements. A U.S. Supreme Court ruling last year also reminded plan fiduciaries about the need to continuously monitor plan investments and fees.
This Bloomberg news story appeared on their Internet site at 4:00 a.m. Denver time on Friday morning — and it comes courtesy of West Virginia reader Elliot Simon. Another link to this article is here.
Hamptons real estate sales slump 21 percent
The number of real estate transactions in the Hamptons fell 21 percent during the second quarter, adding to evidence that the high end of the housing market is faltering.
Sales volume in these wealthy beach communities fell to 561 during the three-month period, from 706 in the second quarter last year, according to a report from Douglas Elliman Real Estate and Miller Samuel Real Estate Appraisers & Consultants. The average sale price also declined, slipping 0.3 percent to $1.68 million.
The softness in the Hamptons mirrors declines in high-end real estate across the country, from Manhattan penthouses and Miami condos to L.A. mansions. While the broader real estate market is strengthening nationwide, wealthy buyers have been spooked by volatile stock markets, election uncertainty and money-laundering investigations.
This news item, along with a 2:20 minute video clip, was posted on the cnbc.com Internet site at 10:32 a.m. EDT on Thursday morning — and I found this story in yesterday’s edition of the King Report. Another link to it is here.
Franklin Sanders interviews “JPMadoff” author Helen Davis Chaitman
The June edition of coin dealer Franklin Sanders’ newsletter, The Moneychanger, has a wonderful interview with financial writer Helen Davis Chaitman, who says that JPMorganChase knew very well that Bernie Madoff’s investment fund was a Ponzi scheme but provided Madoff with banking services anyway because he parked between $3 billion and $6 billion at the bank, which the bank was able to use for its own purposes.
Chaitman, author of the book “JPMadoff: The Unholy Alliance between America’s Biggest Bank and America’s Biggest Crook” — says JPMorganChase is a “criminal institution,” an observation market analyst and author James G. Rickards made last week during his appearance on Russia Today‘s “The Keiser Report.” Rickards called JP Morgan Chase “one of the great criminal enterprises of all time,” since the bank has confessed to many illegal operations and has paid billions of dollars in fines.
Chaitman and Rickards don’t seem to have explained why the investment bank keeps getting away with this stuff, but GATA maintains it’s because the bank often acts as the agent of the U.S. government in rigging markets — that JP Morgan Chase is essentially a U.S. government agency. (Or maybe the U.S. government is a JP Morgan Chase agency.)
This link is definitely worth your while this weekend. And if you’ve already listened to the Rickards interview, it’s worth watching again for the first two minutes just to hear him say those magic words on TV. Of course Ted Butler has been saying that about them for many years as well. ‘All of the above’ was in a GATA release yesterday — and another link to this must read/listen commentary is here.
Decline of Empire: Parallels Between the U.S. and Rome, Part II — Doug Casey
Like the Romans, we’re supposedly ruled by laws, not by men. In Rome, the law started with the 12 Tablets in 451 BCE, with few dictates and simple enough to be inscribed on bronze for all to see. A separate body of common law developed from trials, held sometimes in the Forum, sometimes in the Senate.
When the law was short and simple, the saying “Ignorantia juris non excusat” (ignorance of the law is no excuse) made sense. But as the government and its legislation became more ponderous, the saying became increasingly ridiculous. Eventually, under Diocletian, law became completely arbitrary, with everything done by the emperor’s decrees—we call them Executive Orders today.
I’ve mentioned Diocletian several times already. It’s true that his draconian measures held the Empire together, but it was a matter of destroying Rome in order to save it. As in the U.S., in Rome statute and common law gradually devolved into a maze of bureaucratic rules.
The devolution is similar in the U.S. You’ll recall that only three crimes are mentioned in the U.S. Constitution—treason, counterfeiting, and piracy. Now you can read Harvey Silverglate’s book, Three Felonies a Day, which argues that the average modern-day American, mostly unwittingly, is running his own personal crime wave—because federal law has criminalized over 5,000 different acts.
Like Paul Craig Roberts, Doug is always controversial, but never far off the mark. This Part II of his essay on the decline of empire appeared on the internationalman.com Internet site yesterday — and is certainly worth reading. Another link to it is here.
Global stocks fall, UK PMIs flash Brexit recession warning
U.S. stock prices rose on Friday, marking four straight weeks of gains, while sterling dropped on bleak data that raised fears about a possible British recession following the country’s June 23 vote to leave the European Union.
Concerns about global oversupply hurt oil prices, increasing their weekly losses.
Bond and gold prices fell on expectations the Federal Reserve may raise interest rates by year-end following a recent batch of encouraging U.S. economic data.
“Earnings have been positive for the most part. You have a strong package of data that have been constructive on the equity market, pushing up bond yields and even taking some shine off gold’s recent strong performance,” said Quincy Krosby, market strategist at Newark, New Jersey-based Prudential Financial.
This Reuters article barely resembles its original form. The current iteration is datelined 4:55 p.m. EDT yesterday afternoon, but the Reuters ‘thought police’ have been busy, complete with a new headline, which you’ll see when you click on the link. This piece originally showed up on the Zero Hedge website at 6:39 a.m. EDT on Friday morning, so it has been massaged to perfection in the interim. Brad Robertson was the first person through the door with it — and another link to this Reuters ‘story?’ is here.
Euro Traders Tell Draghi That ECB’s Policy Is Going Nowhere Fast
Euro traders are sending Mario Draghi a clear message: Monetary policy is reaching a dead end.
Just look at how the world’s most-traded currency pair has done this year. Its 200-day moving average has been stuck around $1.10, and it has registered the smallest move of any of the major currencies. All the while, Draghi and the European Central Bank delved deeper into negative interest rates and more aggressive bond-buying — policies that might typically debase the euro.
Even after ECB President Draghi stressed Thursday “readiness, willingness, ability” to add more stimulus in coming months, the euro barely budged. The diminishing impact of monetary stimulus has left the currency open to other drivers, such as trade flows and geopolitics. The euro zone’s trade flows have thwarted euro bears who rebuilt positions in the past two months, as a record current-account surplus provides underlying support for the single currency.
There’s “some fatigue in terms of what central banks can do to control currencies at this point and yes, in terms of what else the ECB may bring to the table,” said Chris Chapman, a London-based trader at Manulife Asset Management (Europe) Ltd. “The sizable current-account surplus is also a factor in helping support the euro versus where most people would expect it to be lower.”
Central banking is a spent force — and more money printing will only end up with hyperinflation and destruction of all fiat currencies. This Bloomberg article showed up on their Internet site at 5:00 p.m. MDT on Thursday afternoon — and was subsequently updated about eight hours later. Another link to this news item is here — and I thank Elliot Simon for finding it for us.
Put Your Hope In Radical Decentralization — Hans-Herman Hoppe in the Polish weekly Najwyższy Czas!
Q. What is your assessment of contemporary Western Europe, and in particular the E.U.?
A. All major political parties in Western Europe, regardless of their different names and party programs, are nowadays committed to the same fundamental idea of democratic socialism. They use democratic elections to legitimize the taxing of productive people for the benefit of unproductive people. They tax people, who have earned their income and accumulated their wealth by producing goods or services purchased voluntarily by consumers (and of course especially the “rich” among those), and they then re-distribute the confiscated loot to themselves, i.e., the democratic State that they control or hope to control, and their various political friends, supporters, and potential voters.
They do not call this policy by its right name: punishing the productive and rewarding the unproductive, of course. That doesn’t sound particularly attractive. Instead, they tap into the always popular sentiment of envy and claim to tax the few “rich” to support the many “poor.” In truth, however, with their policy they make more and more productive people poor and a steadily increasing number of unproductive people rich.
This interview from July 16 was posted on the mises.org Internet site last Sunday — and for length and content reasons, had to wait for my Saturday column. It’s definitely worth reading — and I thank P.T. Holland for sending it our way on Monday. Another link to this interview is here.
Kerry Talks to Russia of Syria, Ukraine, and the New Cold War — Stephen F. Cohen Interviews John Batchelor
Tuesday’s breaking news for Batchelor and Cohen was all about Sec. State, Kerry’s London visit with and Russian Foreign Minister, Lavrov for discussions on Syria, Ukraine and the doping scandal – but primarily focused on Obama’s need to find a solution in Syria in dealing with ISIS. However, the repercussions of the attempted coup in Turkey, with many thousands caught up in an aftermath of purges, are also very important geopolitical events with far reaching consequences to the NCW — New Cold War. And we also hear about fresh fighting in Ukraine. Batchelor refers to all this as chaos, but Cohen argues, “that there is a pattern here” and it is all related to the NCW (a label denied officially by Washington), that this is all symptomatic of the breakdown in the New World Order. To emphasize this Cohen mentions the latest Nice terror event and the French government reaction of sending troops to close the borders; Cohen considers this action as a sign of the end (free trade aspect) of the EU. And finally Cohen acknowledges that NATO is weakened with how Turkey’s Erdogan has reacted to the coup attempt (and its treatment of the E.U. over refugees and its attempts to force entry for EU membership) will see Turkey ostracized both in NATO and the E.U. — and strengthening its ties to Russia. Potentially we may see Turkey drop its support of ISIS. Thus we can see on multiple fronts that this has weakened the West to Russia’s advantage. And we see a related breakthrough with Obama and Putin finally agreeing to cooperate against ISIS. Maybe. Putin still has trust issues with the White House.
The details of the distrust are then discussed with the beginnings of a “mini détente” being formed. The problem for all is that the effort is without any support for it in Washington beyond Obama, or in both American parties, or in the media. And, Cohen adds, not with most Russians either. If Obama succeeds, says Cohen, he may be able to curb a bellicose Clinton presidency should this happen and it should encourage this détente effort to grow to policy levels beyond his presidency. Cohen also discusses how NATO has devolved over time, and with the presence of less stable, more bellicose members as with the Baltic States, to be less about security against real threats from the outside than artificially manufactured ones to advantage local politics. Internal threats to the whole organization are from unstable governments like Turkey. The politics of these cracks in the organization are showing Europeans that NATO itself is a threat to peace and security.
Cohen thinks it is significant that Obama is resisting the war faction and media opposition over working with Putin and calls it a position of wisdom. From a personal perspective whether he can be trusted may be, for example, more a matter of how the State Department echoes these efforts without internal sabotage and in fighting we have seen in the past– as in Ukraine. But it is also clear that present events in Turkey and the Baltic States are weakening NATO, the EU, and hopefully even the American war party goals. Putin knows that a failing E.U. may be the regrettable price for a failing NATO and an avoidance of war. In this there are no winners and losers but just a restructuring for the unforeseeable future and it will be enough that there will be a future.
This 40-minute audio interview was conducted on Tuesday — and posted on the audioboom.com Internet site the same day. For obvious reasons, it had to wait for today’s column. I thank Ken Hurt for the link but, as usual, the biggest Thank You goes out to Larry Galearis for the superb executive summary posted above. Another link to this interview is here.
The Twilight of NATO — Thierry Meyssan
The history of NATO and its current activities enables us to understand how the West has woven its lies and why it is now a prisoner of them. The elements contained in this article are shocking, but it is impossible to deny the facts. The only other solution is to cling to the lies and persist in hanging on.
With the Cold War, two alliances evolved in an imperial fashion – on one hand, NATO, dominated by the United States and, to a lesser extent, by the United Kingdom, and on the other, the Warsaw Pact, dominated by the Soviet Union. As a result, it became impossible to abandon these structures – NATO did not hesitate to use its Gladio network to organise various coups d’état and preventive political assassinations, while the Warsaw Pact openly invaded Hungary and Czechoslovakia, which had shown signs of wanting their independence.
Even before the fall of the Berlin Wall, the Soviet Union put an end to this system. Mikhaïl Gorbatchev allowed each member of the Warsaw Pact to declare their independence («My Way»), which he ironically named his «Sinatra doctrine». When the USSR collapsed, its allies dispersed, and it took several years of stabilisation before the present Collective Security Treaty Organization (CSTO) could be constituted. Having learned from past errors, the CSTO was based on the strict equality of its member states.
It is worth noting, by the way, that both NATO and the Warsaw Pact are organisations which are contrary to the United Nations Charter, since their member states lose their independence by agreeing to place their troops under US or Soviet command.
Unlike Russia, the United States have remained an empire, and continue to use NATO to batter their allies into obedience. The initial objective of pressuring the Soviets so that they would refrain from helping the Western Communists to gain power, no longer has any meaning. So all that is left now is U.S. guardianship.
This commentary, which falls into the absolute must read category, put in an appearance on the voltairenet.org Internet site back on July 13 — and I thank Patricia Caulfield for sharing it with us. Another link to this article is here.
The Coup in Turkey has Thrown a Wrench in Uncle Sam’s “Pivot” Plan — Mike Whitney
A failed coup in Turkey has changed the geopolitical landscape overnight realigning Ankara with Moscow while shattering Washington’s plan to redraw the map of the Middle East. Whether Turkish strongman Recep Tayyip Erdogan staged the coup or not is of little importance in the bigger scheme of things. The fact is, the incident has consolidated his power domestically while derailing Washington’s plan to control critical resources and pipeline corridors from Qatar to Europe. The Obama administrations disregard for the national security interests of its allies, has pushed the Turkish president into Moscow’s camp, removing the crucial land bridge between Europe and Asia that Washington needs to maintain its global hegemony into the new century. Washington’s plan to pivot to Asia, surround and break up Russia, control China’s growth and maintain its iron grip on global power is now in a shambles. The events of the last few days have changed everything.
Obama can only blame himself for the debacle that is now unfolding. Erdogan was completely clear about Turkey’s red lines, the most important of which is preventing the Kurdish militias from moving west of the Euphrates and creating a contiguous state along the Syrian side of Turkeys southern border.
Instead of addressing Erdogan’s security concerns, Obama brushed him aside in order to pursue the US goal of establishing bases and seizing territory in East Syria that will eventually be used as pipeline routes from Qatar to the EU. Naturally, Erdogan responded in kind, forming alliances with former enemies (Russia, Syria, Israel) in order to reset Turkish foreign policy and address the growing threat of an emerging Kurdish state on his southern flank. Keep in mind, Turkey believes that America’s new proxies in Syria–the Kurdish YPG– are linked to the PKK, which is listed as a terror organization by the U.S. and EU. Had Obama committed US troops to the fight, (instead of using the YPG) Erdogan would not have reacted at all. But the fact that Obama was deliberately strengthening Turkey’s traditional rivals in their westward move, was more than Erdogan could bear.
This Mike Whitney commentary appeared on the counterpunch.org Internet site on Wednesday sometime — and easily falls into the absolute must read category, even if you’re not a serious student of the New Great Game. Another link to this must read essay is here — and I thank Patricia Caulfield for her second contribution in a row. [Note: This item appeared in my Thursday column — and at that time I said that for length and content reasons that I would post it in my Saturday missive as well — and here it is. – Ed]
Syria and the Coup in Turkey — The Saker
This week has been marked by two major events: the USA and Russia agreed to a common plan for military co-ordination in Syria and the failed coup in Turkey has been followed by a massive purge of the Turkish elites.
Syria:
The Russians had really no option but to accept working with the USA in Syria. The way in which they did this was very elegant, however: Lavrov and Kerry have agreed to a joint long-term ceasefire whose exact terms are to remain secret, which indicates to me that the Russians forced the U.S. into concessions which the latter don’t want to be made public. How do we know that it was Russians who forced concessions on the USA and not the other way around? Simple – there was no U.S. “leak” to the media and the Russian bombers have resumed their operation with a new intensity. Besides, it is pretty obvious that in Syria at least Moscow holds all the cards now and Kerry has therefore no means to put pressure on Russia even if he wanted to.
But the main development for Syria is still the coup in Turkey.
Turkey:
What happened in Turkey is huge. So big, in fact, that I even suspect that the numerous rumors about an Erdogan-orchestrated false flag could have been started by the US propaganda machine (since when have mainstream media outlets even discussed false flags?). Not everybody bought into the false flag theory, not Sibel Edmonds and not M. K. Bhadrakumar. Not only did these two reject the false flag theory, they also explained in detail the role of the USA in this coup. To their testimony I can only add that I have been contacted by several well-informed readers from countries neighboring Turkey who have also told me that at least a “faction” inside the USA has had advance knowledge of the coup.
There are now reports that Russia also had advanced warning and that Putin personally warned Erdogan.
This is another must read commentary. This one showed up on the unz.com Internet site on Friday — and it’s courtesy of reader ‘aurora’. Another link to this must read news item is here.
Doug Noland: Don’t Mess With Turkey
July 20 – JNiMedia: “Erdogan blasted Standard & Poor’s downgrading of Turkey’s rating in the wake of the failed coup. ‘Why are you even interested in Turkey? We’re not part of you… Don’t ever try to mess with us,’ he said.”
Perhaps Standard & Poor’s and fellow rating agencies share keen interest because Turkey and Turkish corporations and financial institutions have over recent year been assertive borrowers in international markets. For the past decade, President Erdogan has championed Turkish economic renaissance, a powerful boom that has been fundamental to his popularity and ascending political power. Unfortunately, it morphed into a Credit-fueled Bubble, with all the associated financial, economic and social consequences. Turkish consumer debt has skyrocketed, fueled by aggressive bank lending. Meanwhile, Turkey’s financial institutions have borrowed aggressively in global inter-bank markets, with much of this debt short-term and denominated in foreign currencies.
The Turkish Credit Bubble gained important momentum as part of the post-2008 global EM funding boom. Estimates have as much as $300 billion having flowed into Turkey over recent years, inflows that accelerated with the 2013 sovereign rating upgrade to investment grade. As a NATO member, aspiring EU nation and key ally in the explosive Middle East, Turkey benefited greatly from the view that Europe, the U.S. and the world, more generally, would not tolerate crisis engulfing Turkey.
Erdogan and his AKP party have been huge beneficiaries of the global funding boom, both financially and politically. Now, with the tide having turned, previous bedfellows – the rating agencies and global finance – will be pilloried and villainized for political advantage. To be sure, they’re a precarious mix of C’s – coups, crackdowns, crackpots, Credit and confidence. It’s worth noting that the domestic purge has expanded past university deans to school teachers to to bank regulators.
Doug’s weekly Credit Bubble Bulletin showed up on his website around midnight Denver time — and is certainly a must read if you have the interest. Another link to his commentary is here.
Super-hard metal ‘four times tougher than titanium’
A super-hard metal has been made in the laboratory by melting together titanium and gold.
The alloy is the hardest known metallic substance compatible with living tissues, say U.S. physicists.
The material is four times harder than pure titanium and has applications in making longer-lasting medical implants, they say.
Conventional knee and hip implants have to be replaced after about 10 years due to wear and tear.
Prof Emilia Morosan, of Rice University, Houston, said her team had made the discovery while working on unconventional magnets made from titanium and gold.
This short news item put in an appearance on the bbc.com Internet site yesterday sometime — and I thank David Larsen for pointing it out. Another link to this story is here.
The Gold Chronicles: July 15, 2016 Interview with Jim Rickards
* Post Brexit analysis
* Elite economic class is forecasting substantial problems for the global economy
* Summary history of the Bank of England
* Role of the Bank for International Settlements (BIS)
* Analysis of total debt monetization in Japan compromising Shanghai Accord
This 47:05 minute audio interview was posted on the physicalgoldfund.com Internet site on Wednesday — and I thank Harold Jacobsen for bringing it to my attention — and now to yours.
The PHOTOS and the FUNNIES
I just haven’t had the time to visit the sloughs and pot holes this week, so today’s photos are a sequence I took five meters from my back door — and in the 1 centimeter-wide cracks between the paving stones of my patio. Through a macro lens, a microscopic world appears that, unless you take the time to look, you just never see. The CLICK to ENLARGE feature is a MUST here.
The first photo shows the green green colour of these very tiny mosses that began to appear between the paving stones in my patio about two years ago. Now it has spread just about everywhere — and I don’t mind it a bit. The first shot is of the overall, a sort of street-level view of things. Except for the green colour, there’s not much to see.
This second photo is an area of the patio about 1″/25 mm wide and about 1.5″/38 mm high. Click to Enlarge.
The third photo is a tiny slice from the top of the second photo posted above. It takes in an area less that 1 cm x 2 cm — well under half a square inch. The tiny white ‘rocks’ scattered about on the microscopic moss plants are grains of sand. Click to enlarge is a must.
This third photo is an area about the same size as the prior photo — 1 x 2 cm — and the moss was slightly different, but the difference was only visible through the macro lens on my camera — because , except for the colour, the structure was invisible to the naked eye. The amber-coloured ‘rock’ on the right-hand side of the shot is a grain of sand as well. It’s the little things in this photo that gives you some sense of scale. The rock cliffs are the patio stones magnified many times — and even in them, you can see every tiny sand particle and small piece of gravel that makes them up. The small green ‘log’ at the bottom left is tiny grass clipping, as I’d just mowed the yard. Click to Enlarge!<img class="alignleft size-