-j-p-shmorgan
New Member
If China mines their own gold...what is their incentive for purposefully dropping the price of gold???
Ainslie Bullion - Daily news, Weekly Radio and Discussions
- Thread starter AinslieBullion
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Golden Retriever
New Member
Because they don't sell any of it. It gets thrown in the pile with all the stuff they're buying from everywhere else.
-j-p-shmorgan
New Member
Golden Retriever said:
The only stuff they are buying is their own stock market. lol
-j-p-shmorgan said:
Just like the Japanese and The Fed. What is new ?
AinslieBullion
Member
Recessionary Warning for US
The US Fed has a conundrum. It is seeing signs of recovery in the US, albeit weak, and everyone is expecting them to raise rates to prove everything is awesome and stop this asset bubble forming stimulus experiment. But the fact is the US is part of the world and the world is simply not doing well. As discussed in today's Weekly Wrap https://www.ainsliebullion.com.au/g...uly-ainslie-radio/tabid/88/a/996/default.aspx, the latest warning sign is World Trade Volume has just taken its steepest and longest decline over the last 6 months since the GFC. The graph below tells the story. When you are the world's biggest economy and biggest consumer, this spells recessionary forces that don't gel with a rate rise.
The US Fed has a conundrum. It is seeing signs of recovery in the US, albeit weak, and everyone is expecting them to raise rates to prove everything is awesome and stop this asset bubble forming stimulus experiment. But the fact is the US is part of the world and the world is simply not doing well. As discussed in today's Weekly Wrap https://www.ainsliebullion.com.au/g...uly-ainslie-radio/tabid/88/a/996/default.aspx, the latest warning sign is World Trade Volume has just taken its steepest and longest decline over the last 6 months since the GFC. The graph below tells the story. When you are the world's biggest economy and biggest consumer, this spells recessionary forces that don't gel with a rate rise.
-j-p-shmorgan
New Member
AinslieBullion said:
I enjoyed listening to the Anslie radio for Friday July 24.
Very interesting commentary on China & their latest moves.
AinslieBullion
Member
New Record on COMEX
The graph below (courtesy of ZeroHedge) tells the story grabbing headlines at present. Gold has joined silver in having the largest number of Managed Money (Hedge Fund) short COMEX contracts on record courtesy of the crafty Commercials/big Bullion Banks. They are now net short. For contrarians that is a screaming buy signal as we discussed previously.
COMEX analyst Ted Butler had this to say after the above was revealed on Saturday
"I don't have any reservation in speaking about gold in terms of COT [Commitment of Traders report issued by COMEX] market structure and on that basis alone,gold looks good to go higher from here. Like silver, it is very far advanced in establishing an important COT cycle bottom. Since there is no way to adequately predict in advance precise price bottoms and, especially, the maximum number of contracts to be positioned, the best anyone can do is hope to come close.
Instead of reminiscing over the past five years, an objective review of what transpired on the COMEX over the past two months should tell you all that matters in gold and silver. It has been the speculative selling of the equivalents of 10 million oz of gold and more than 250 million oz of silver (all arranged by the COMEX "commercials") that has caused prices to drop. And it will be the unwinding of speculative short sales and new long positioning which will drive prices higher.
In fact, just as the maximum amount of attention and sentiment is set on lower prices, the focus should be on how high gold and silver prices will advance. That's the important consideration at this point. The answer to that question, of course, lies with how aggressive the commercials will be in selling when the speculators get buy signals (courtesy of the commercial price riggers themselves). But the fact that managed money shorts are larger than they have ever been also means these traders have never been put in a more compromising position."
If you look at the chart above you can see the lowest low beforehand was in late 2006. The chart below shows what happened immediately afterwards, and that is in essence what Ted Butler is talking about. The difference this time is the coil is wound far far tighter
The graph below (courtesy of ZeroHedge) tells the story grabbing headlines at present. Gold has joined silver in having the largest number of Managed Money (Hedge Fund) short COMEX contracts on record courtesy of the crafty Commercials/big Bullion Banks. They are now net short. For contrarians that is a screaming buy signal as we discussed previously.
COMEX analyst Ted Butler had this to say after the above was revealed on Saturday
"I don't have any reservation in speaking about gold in terms of COT [Commitment of Traders report issued by COMEX] market structure and on that basis alone,gold looks good to go higher from here. Like silver, it is very far advanced in establishing an important COT cycle bottom. Since there is no way to adequately predict in advance precise price bottoms and, especially, the maximum number of contracts to be positioned, the best anyone can do is hope to come close.
Instead of reminiscing over the past five years, an objective review of what transpired on the COMEX over the past two months should tell you all that matters in gold and silver. It has been the speculative selling of the equivalents of 10 million oz of gold and more than 250 million oz of silver (all arranged by the COMEX "commercials") that has caused prices to drop. And it will be the unwinding of speculative short sales and new long positioning which will drive prices higher.
In fact, just as the maximum amount of attention and sentiment is set on lower prices, the focus should be on how high gold and silver prices will advance. That's the important consideration at this point. The answer to that question, of course, lies with how aggressive the commercials will be in selling when the speculators get buy signals (courtesy of the commercial price riggers themselves). But the fact that managed money shorts are larger than they have ever been also means these traders have never been put in a more compromising position."
If you look at the chart above you can see the lowest low beforehand was in late 2006. The chart below shows what happened immediately afterwards, and that is in essence what Ted Butler is talking about. The difference this time is the coil is wound far far tighter
-j-p-shmorgan
New Member
Interesting times ahead - for sure!!!
AinslieBullion
Member
A Turning Point for Shares?
We are seeing a distinct change in 2 of the world's biggest stock markets that may indicate the easy money game is no longer working.
Yesterday right toward the end of trade, the Shanghai Composite plunged nearly 8.5% in its biggest one day drop since the start of the GFC and second biggest in history.
In the US we are seeing the S&P500 break key resistance lines not broken since the post GFC rally began and looking like the formation of a down trend. Note each time prior when there was a downturn it was reversed by the US Fed starting a new round of QE. Funny that now it is happening again they are talking about RAISING rates the opposite of previous stimulatory responses. What could possibly go wrong?
Our Aussie All Ords seems to be on a similar path
So there appears to be a choice between buying something at or just past its top, or buying something (say, gold and silver) that looks at or near its bottom
We are seeing a distinct change in 2 of the world's biggest stock markets that may indicate the easy money game is no longer working.
Yesterday right toward the end of trade, the Shanghai Composite plunged nearly 8.5% in its biggest one day drop since the start of the GFC and second biggest in history.
In the US we are seeing the S&P500 break key resistance lines not broken since the post GFC rally began and looking like the formation of a down trend. Note each time prior when there was a downturn it was reversed by the US Fed starting a new round of QE. Funny that now it is happening again they are talking about RAISING rates the opposite of previous stimulatory responses. What could possibly go wrong?
Our Aussie All Ords seems to be on a similar path
So there appears to be a choice between buying something at or just past its top, or buying something (say, gold and silver) that looks at or near its bottom
AinslieBullion
Member
Interest Rates and Gold
Gold is certainly on the nose at the moment with many predicting further falls to come. But if the basis for much of those calls is the supposed imminent raising of interest rates by the US Fed then it is worth looking at that a little more factually. The reasoning is that with higher rates your cost of holding the non yielding asset effectively rises and so the market is pricing that in now.
It also signals that everything is "OK" now so no need to have a defensive asset. We discussed the ramifications of a rate rise here earlier this month (https://www.ainsliebullion.com.au/g...-fear-a-rate-rise/tabid/88/a/975/default.aspx) but today let's look more empirically at the relationship between gold and interest rates to debunk this widely held view that rising rates are bearish for gold.
If one goes back to the last big gold bull market of the 70's the evidence presented in the graph below is pretty clear. Both gold and silver rose (and fell) together with interest rates.
Many still argue we are in the equivalent of the 1976 'bear trap' intra secular bull market phase right now. As you can see above, in 1976 gold almost halved from it's previous high a couple of years earlier. Upon raising rates gold then commenced its 850% increase to its peak in 1980.
Gold is certainly on the nose at the moment with many predicting further falls to come. But if the basis for much of those calls is the supposed imminent raising of interest rates by the US Fed then it is worth looking at that a little more factually. The reasoning is that with higher rates your cost of holding the non yielding asset effectively rises and so the market is pricing that in now.
It also signals that everything is "OK" now so no need to have a defensive asset. We discussed the ramifications of a rate rise here earlier this month (https://www.ainsliebullion.com.au/g...-fear-a-rate-rise/tabid/88/a/975/default.aspx) but today let's look more empirically at the relationship between gold and interest rates to debunk this widely held view that rising rates are bearish for gold.
If one goes back to the last big gold bull market of the 70's the evidence presented in the graph below is pretty clear. Both gold and silver rose (and fell) together with interest rates.
Many still argue we are in the equivalent of the 1976 'bear trap' intra secular bull market phase right now. As you can see above, in 1976 gold almost halved from it's previous high a couple of years earlier. Upon raising rates gold then commenced its 850% increase to its peak in 1980.
AinslieBullion
Member
Silver Institute 1H 2015 Report
The Silver Institute has released interim supply/demand figures for the first half of 2015. We provide a summary as follows:
Jewellery demand up 11% in US (largest user). Demand to grow 5% over all of 2015.
Industrial use nearly 60% of total demand. 2% growth predicted over all of 2015.
- Solar panels 8% increase to 65m oz
- Ethylene oxide 61% increase to 8.6m oz
- Electronics 0.4% increase [qty not quoted but 264m oz 2014]
Investment demand:
- ETF 4.7m increase
- Bullion coin 6% down at 43.6m oz but still 5th highest ever
- [ Note Bullion bars not quoted 196m oz total in 2014]
Supply / demand silver market expected to be 57.7m oz in DEFICIT this year
- Supply contracting
- Demand growing
- 3rd year in a row of a deficit
Average gold : silver ratio for first half 73 compared to 58 average since 2000 [and as we often reference c45 over the last century]\
- Puts silver undervalued compared to gold adding weight to continued investment demand.
- One could be excused for wondering how on earth the price could be this low then? If you are you might have missed reading this article https://www.ainsliebullion.com.au/g...w-record-on-comex/tabid/88/a/998/default.aspx from earlier this week.
The Silver Institute has released interim supply/demand figures for the first half of 2015. We provide a summary as follows:
Jewellery demand up 11% in US (largest user). Demand to grow 5% over all of 2015.
Industrial use nearly 60% of total demand. 2% growth predicted over all of 2015.
- Solar panels 8% increase to 65m oz
- Ethylene oxide 61% increase to 8.6m oz
- Electronics 0.4% increase [qty not quoted but 264m oz 2014]
Investment demand:
- ETF 4.7m increase
- Bullion coin 6% down at 43.6m oz but still 5th highest ever
- [ Note Bullion bars not quoted 196m oz total in 2014]
Supply / demand silver market expected to be 57.7m oz in DEFICIT this year
- Supply contracting
- Demand growing
- 3rd year in a row of a deficit
Average gold : silver ratio for first half 73 compared to 58 average since 2000 [and as we often reference c45 over the last century]\
- Puts silver undervalued compared to gold adding weight to continued investment demand.
- One could be excused for wondering how on earth the price could be this low then? If you are you might have missed reading this article https://www.ainsliebullion.com.au/g...w-record-on-comex/tabid/88/a/998/default.aspx from earlier this week.
AinslieBullion
Member
Quote of the Week
James Grant is a highly regarded financial analyst, author and historian. As someone who has studied the financial markets for over 40 years he always provides insightful commentary on its dynamics and enjoys a huge following to his Interest Rate Observer (since 1983). In short when he speaks many listen. This is what he had to say this last week:
"You look around the world and you see exchange rates are properly disorderly, when you look around the world of lending and borrowing - we are in a regime of price control by another name, so-called zero percent rates and quantitative easing by the world central banks.
We are in one of the most radical periods of monetary experimentation in the annals of money, with a low probability of a favourable outcome.
Given the disorder I see in the world due to monetary experimentation and the very low gold price, you want to have exposure to the reciprocal asset of the paper assets that are the most popular - so gold, to me, is now the conjunction of price, value and sentiment, and I am very bullish indeed.
The recent fall in prices are terrifically vexing but a wonderful opportunity. The reasons for owning gold have not gone away. Gold thrives in periods of turbulence and disorder and uncertainty. I think we have all three of these things."
James Grant is a highly regarded financial analyst, author and historian. As someone who has studied the financial markets for over 40 years he always provides insightful commentary on its dynamics and enjoys a huge following to his Interest Rate Observer (since 1983). In short when he speaks many listen. This is what he had to say this last week:
"You look around the world and you see exchange rates are properly disorderly, when you look around the world of lending and borrowing - we are in a regime of price control by another name, so-called zero percent rates and quantitative easing by the world central banks.
We are in one of the most radical periods of monetary experimentation in the annals of money, with a low probability of a favourable outcome.
Given the disorder I see in the world due to monetary experimentation and the very low gold price, you want to have exposure to the reciprocal asset of the paper assets that are the most popular - so gold, to me, is now the conjunction of price, value and sentiment, and I am very bullish indeed.
The recent fall in prices are terrifically vexing but a wonderful opportunity. The reasons for owning gold have not gone away. Gold thrives in periods of turbulence and disorder and uncertainty. I think we have all three of these things."
AinslieBullion
Member
The Big Squeeze on COMEX
Amid stories of supposed falling demand for gold (which we addressed on Friday) there is yet another clear indicator of the exact opposite.
The graph below clearly lays out, from official COT records, the number of futures contracts (Open Interest), the amount of gold available for delivery (Registered Gold) and nicely / scarily summarised in the last graph which shows the ratio of Open Interest to Registered Stock. Yes your eyes don't deceive we have a new record of 121.66 "owners" of an ounce for every ounce of gold available what could possibly go wrong huh. Welcome to the world of paper trades in gold that, incredibly, largely set the spot price. Another sobering way to look at this is that total value of gold available for delivery is around $390m. In the gold Flash Crash (https://www.ainsliebullion.com.au/g...e-spring-e2-80-99/tabid/88/a/993/default.aspx) a couple of weeks ago no less than $2.7b was traded in just minutes. All that trade had to be was someone demanding delivery, not just another cash paper trade, and the whole thing blows up.
The other telling insight last week was that a large part of the draw down in COMEX stock was the removal of 222,581oz in 1kg bars (not used by Comex contracts but the mainstay of Chinese imports) suggesting yet again that Asian demand is much higher than being reported.
Indeed in the latest withdrawal figures from the Shanghai Gold Exchange for the week ending 24 July was 73.3t! That is the 3rd highest weekly level of consumption ever (and hot off the previous week being the 5th highest ever).
There is a real game being played out between the paper and physical markets at the moment. Our money is on the physical markets winning and winning in a spectacular way before long.
Amid stories of supposed falling demand for gold (which we addressed on Friday) there is yet another clear indicator of the exact opposite.
The graph below clearly lays out, from official COT records, the number of futures contracts (Open Interest), the amount of gold available for delivery (Registered Gold) and nicely / scarily summarised in the last graph which shows the ratio of Open Interest to Registered Stock. Yes your eyes don't deceive we have a new record of 121.66 "owners" of an ounce for every ounce of gold available what could possibly go wrong huh. Welcome to the world of paper trades in gold that, incredibly, largely set the spot price. Another sobering way to look at this is that total value of gold available for delivery is around $390m. In the gold Flash Crash (https://www.ainsliebullion.com.au/g...e-spring-e2-80-99/tabid/88/a/993/default.aspx) a couple of weeks ago no less than $2.7b was traded in just minutes. All that trade had to be was someone demanding delivery, not just another cash paper trade, and the whole thing blows up.
The other telling insight last week was that a large part of the draw down in COMEX stock was the removal of 222,581oz in 1kg bars (not used by Comex contracts but the mainstay of Chinese imports) suggesting yet again that Asian demand is much higher than being reported.
Indeed in the latest withdrawal figures from the Shanghai Gold Exchange for the week ending 24 July was 73.3t! That is the 3rd highest weekly level of consumption ever (and hot off the previous week being the 5th highest ever).
There is a real game being played out between the paper and physical markets at the moment. Our money is on the physical markets winning and winning in a spectacular way before long.
-j-p-shmorgan
New Member
Amazing. Great times now & in near future for accumulation.
AinslieBullion
Member
Buying Gold at 'Paper Prices'
We spoke yesterday about the incredible set up in COMEX futures where there are 121 paper claims on each physical ounce available. We also have substantial backwardation yet again (explained here: https://www.ainsliebullion.com.au/g...n-gold-and-silver/tabid/88/a/920/default.aspx) and we have strong demand across the globe evidenced by the Chinese demand referenced yesterday (the highest week on record); Indian demand back to 'pre restriction' numbers of 2012; the US Mint running out of Silver Eagles (and despite not taking orders for most of July still selling a near record 5.5m of them in that month!) and selling the most gold coins since April 2013; Russia's central bank continuing its relentless buy up; and here in Australia the Perth Mint recently reporting it is having trouble keeping up with demand (and critically stating mine supply is an issue, where we are the world's 2nd biggest producer!).
And YET, we are seeing prices continue to decline. What seems more and more inevitable is the disconnection of paper and physical markets played out through higher margins for physical metal and paper defaults. We saw the former for a while in mid 2013 where similarly on a price drop demand went nuts and refiners and bullion dealers had to pay a premium to get hold of physical metal, plus there were supply delays. Now please note that was on a price DROP when demand is mainly those few who understand the reasons for owning precious metals and understand it is simply 'on sale'. Ask yourself what happens on a price rise when the hoards come piling in? We may or may not currently be 'at the bottom' no one, but no one knows. What you could be fairly certain of though is that you will only know afterwards and you simply may either not be able to get the metal, or premiums will jump so substantially that today's prices look pretty good but you will then have to wait to get it. We are now only 1 month from the chorus of predictions for a September financial markets crash
We spoke yesterday about the incredible set up in COMEX futures where there are 121 paper claims on each physical ounce available. We also have substantial backwardation yet again (explained here: https://www.ainsliebullion.com.au/g...n-gold-and-silver/tabid/88/a/920/default.aspx) and we have strong demand across the globe evidenced by the Chinese demand referenced yesterday (the highest week on record); Indian demand back to 'pre restriction' numbers of 2012; the US Mint running out of Silver Eagles (and despite not taking orders for most of July still selling a near record 5.5m of them in that month!) and selling the most gold coins since April 2013; Russia's central bank continuing its relentless buy up; and here in Australia the Perth Mint recently reporting it is having trouble keeping up with demand (and critically stating mine supply is an issue, where we are the world's 2nd biggest producer!).
And YET, we are seeing prices continue to decline. What seems more and more inevitable is the disconnection of paper and physical markets played out through higher margins for physical metal and paper defaults. We saw the former for a while in mid 2013 where similarly on a price drop demand went nuts and refiners and bullion dealers had to pay a premium to get hold of physical metal, plus there were supply delays. Now please note that was on a price DROP when demand is mainly those few who understand the reasons for owning precious metals and understand it is simply 'on sale'. Ask yourself what happens on a price rise when the hoards come piling in? We may or may not currently be 'at the bottom' no one, but no one knows. What you could be fairly certain of though is that you will only know afterwards and you simply may either not be able to get the metal, or premiums will jump so substantially that today's prices look pretty good but you will then have to wait to get it. We are now only 1 month from the chorus of predictions for a September financial markets crash
AinslieBullion
Member
US - Recession v Rate Rise
As discussed many times, much of the pressure on gold is the expectation of an imminent US Fed rate hike because everything is so awesome. We've also established public consumption is the key component to GDP growth. The precursor to consumption is either producing the goods to be consumed or importing them. So where is the US right now on that measure?
On importing the latest ISM Index showed the import component falling to its lowest in 3 years.
The graph below appears to paint an incredibly clear picture of US factory orders (making things to consume). They have just dropped YoY for the 8th month in a row the longest streak of declining factory orders outside of a recession in history. We say 'appears' because if you remove the defence aircraft component (up 21% courtesy of, you guessed it, US government deficit spendingaka debt) it is actually much worse. The pink vertical bands indicate previous recessions.
The reason there is no pink recession band in 2015 in the chart could simply be the changes made over the years to how CPI (inflation) is calculated and the subsequent effect on real GDP. There is one index that hasn't changed and that is the Chapwood Index defined as follows - "The Chapwood Index reflects the true cost-of-living increase in America. Updated and released twice a year, it reports the unadjusted actual cost and price fluctuation of the top 500 items on which Americans spend their after-tax dollars in the 50 largest cities in the nation.". If you apply that index to GDP, the US is already in recession anyway. Pretty rare for rates to rise in a recession
As discussed many times, much of the pressure on gold is the expectation of an imminent US Fed rate hike because everything is so awesome. We've also established public consumption is the key component to GDP growth. The precursor to consumption is either producing the goods to be consumed or importing them. So where is the US right now on that measure?
On importing the latest ISM Index showed the import component falling to its lowest in 3 years.
The graph below appears to paint an incredibly clear picture of US factory orders (making things to consume). They have just dropped YoY for the 8th month in a row the longest streak of declining factory orders outside of a recession in history. We say 'appears' because if you remove the defence aircraft component (up 21% courtesy of, you guessed it, US government deficit spendingaka debt) it is actually much worse. The pink vertical bands indicate previous recessions.
The reason there is no pink recession band in 2015 in the chart could simply be the changes made over the years to how CPI (inflation) is calculated and the subsequent effect on real GDP. There is one index that hasn't changed and that is the Chapwood Index defined as follows - "The Chapwood Index reflects the true cost-of-living increase in America. Updated and released twice a year, it reports the unadjusted actual cost and price fluctuation of the top 500 items on which Americans spend their after-tax dollars in the 50 largest cities in the nation.". If you apply that index to GDP, the US is already in recession anyway. Pretty rare for rates to rise in a recession
-j-p-shmorgan
New Member
I think there has been sooo much talk about rates rising....that it would seem Yellen is trying to prep the markets for the announcement.
Almost as if she's expecting the rate hike to not affect markets much, as they should adjust accordingly prior to the hike.
I can see a rate hike in Sept & Dec happening.
The US dollar will continue gaining strength as commodities keep getting hammered.
At sub $30 oil...$800 gold / $10 silver?
After the hikes & slaughtering of commodities, I would expect big rallies........
.....but who knows how long that will take if we're in a prolonged depression/recession.
Almost as if she's expecting the rate hike to not affect markets much, as they should adjust accordingly prior to the hike.
I can see a rate hike in Sept & Dec happening.
The US dollar will continue gaining strength as commodities keep getting hammered.
At sub $30 oil...$800 gold / $10 silver?
After the hikes & slaughtering of commodities, I would expect big rallies........
.....but who knows how long that will take if we're in a prolonged depression/recession.
AinslieBullion
Member
Recession v Rate Rise 2
Yesterday we included a chart overlaying factory orders with previous recessions (shown as pink bands). We invite you to look at the following chart in that same light and see if you spot a similar trend. Below is the CRB Commodity Index mapped since 1974. As you can see we are well into a serious decline. Now overlay the pink recession bands from yesterday and see what you find As with yesterday's Factory Orders, you can see that such declines have coincided with recessions in the past.
The Australian Financial Review today has a front page caption "Reality Check Investors are not ready for a Fed rate hike yet". It goes on to report the fear of "disruption" (the understatement of the day) in markets should the September hike happen.
The charts of above and yesterday tell a clear story, and whilst only part of the economic puzzle they are not alone. More importantly they indicate a market in decline and last time that happened they stimulated it with more QE. So ironically whilst the world is fixated on whether or not there will be a rate rise, some are asking when will QE4 start? The chart below might tell you this is not so fanciful a concept.
Yesterday we included a chart overlaying factory orders with previous recessions (shown as pink bands). We invite you to look at the following chart in that same light and see if you spot a similar trend. Below is the CRB Commodity Index mapped since 1974. As you can see we are well into a serious decline. Now overlay the pink recession bands from yesterday and see what you find As with yesterday's Factory Orders, you can see that such declines have coincided with recessions in the past.
The Australian Financial Review today has a front page caption "Reality Check Investors are not ready for a Fed rate hike yet". It goes on to report the fear of "disruption" (the understatement of the day) in markets should the September hike happen.
The charts of above and yesterday tell a clear story, and whilst only part of the economic puzzle they are not alone. More importantly they indicate a market in decline and last time that happened they stimulated it with more QE. So ironically whilst the world is fixated on whether or not there will be a rate rise, some are asking when will QE4 start? The chart below might tell you this is not so fanciful a concept.
-j-p-shmorgan
New Member
QE4 you say? Not so unlikely looking at this....
AinslieBullion
Member
Derivatives - Worse Than the GFC
Economist and multi-millionaire businessman Doug Casey of Casey Research recently released his "5 unsettling signs we're headed for a worse crash than 2008" forecast. His number one reason is America's banks are in greater danger now than before the GFC. Here's what he had to say:
"Remember derivatives? The absurdly complex financial instruments that essentially caused the massive bank failures in 2008 and led to the biggest economic collapse since the Great Depression? Well, what if I told you the amount of exposure to derivatives the top five US banks have - right now, today - is 45% LARGER than it was just before the collapse in 2008? That's not a typo. The very same people who created the 2008 banking crisis are at it again,- having created another, much bigger ($273 TRILLION) derivatives bubble (versus $187 trillion in '08)."
Economist and multi-millionaire businessman Doug Casey of Casey Research recently released his "5 unsettling signs we're headed for a worse crash than 2008" forecast. His number one reason is America's banks are in greater danger now than before the GFC. Here's what he had to say:
"Remember derivatives? The absurdly complex financial instruments that essentially caused the massive bank failures in 2008 and led to the biggest economic collapse since the Great Depression? Well, what if I told you the amount of exposure to derivatives the top five US banks have - right now, today - is 45% LARGER than it was just before the collapse in 2008? That's not a typo. The very same people who created the 2008 banking crisis are at it again,- having created another, much bigger ($273 TRILLION) derivatives bubble (versus $187 trillion in '08)."