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Aug 9, 2013

Former Treasury official Roberts marvels at claims to imaginary gold: GATA | THE GATA DISPATCH AUGUST 09, 2013.

Former Treasury official Roberts marvels at claims to imaginary gold

4:50p ET Friday, August 9, 2013

Interviewed by King World News today, former Assistant U.S. Treasury Secretary Paul Craig Roberts marvels at the perversion of ordinary markets by derivatives and particularly the explosion of paper claims on gold that doesn't exist.
"What this shows," Roberts says, "is the consequence of repealing the position limits on speculation, because you now have a situation where derivatives drive the actual physical market. This is the exact opposite of what sound economics would have. ... At some point even the people gambling in this market have got to see this can't continue to work. I dont really understand how it's gone on this long, and I don't see how it can continue, particularly when the paper claims so vastly exceed the actual supply."
An excerpt from the interview is posted at the King World News blog here:

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

Wall Street at Close Report by MarketWatch August 09, 2013: Stocks fall; Dow breaks six-week win streak

Stocks fall; Dow breaks six-week win streak

By Kate Gibson, MarketWatch 
NEW YORK (MarketWatch) U.S. stock indexes declined Friday, with the Dow Jones Industrial Average halting its longest weekly winning streak since August of last year. 
“It’s difficult to attach a great deal of meaning to today’s action without volume, which is lackluster. We’ve tried to make the stories fit the market action, and that’s a dangerous game, especially in low volume,” said Art Hogan, market strategist at Lazard Capital Markets. 

“We certainly came into a week we knew was wanting for catalysts. Last week we had a plethora of economic data and a preponderance of quarterly reports; this week we have neither,” he added. 

Stocks to watch: Blackberry
Brendan Conway joins the News Hub with a look at which stocks traders will be watching during market action, including Blackberry,, and Monster Beverage Corp. 

The Dow Jones Industrial Average DJIA -0.47% halted a six-week winning stretch, its longest since one that ended Aug. 17, 2012. It declined as many as 152 points Friday, but ended with a loss of 72.81 points, or 0.5%, at 15,425.51, leaving it down 1.5% on the week.
After rising to a session high of 1,699.42, the S&P 500 index SPX -0.36%  fell 6.06 points, or 0.4%, to 1,691.42, off 1.1% for the week, with telecommunications leading sector declines and materials faring the best.
“We’ve seen another attempt at taking that 1,700 level and failed, which may have fueled some technical selling. Those that watch from a technical basis think that’s significant,” Hogan.
The S&P 500 index last Friday closed at a record 1,709.67, a day after finishing above 1,700 for the first time. It’s up nearly 19% for the year.
“This week, we’re only setting records for our lack of volume,” said Hogan, who noted that Monday marked the lowest full-day volume in 12 months. 

Stocks starting to look overvalued?
For the past several years, stock-market bulls have been able to argue that stocks are cheap, but that argument is increasingly on shaky ground. Alexandra Scaggs explains on MoneyBeat.

The Nasdaq Composite COMP -0.25%  shed 9.02 points, or 0.3%, to 3,660.11 and off 0.8% from the week-ago close.
Decliners ran slightly ahead of advancers on the New York Stock Exchange, where nearly 634 million shares traded.
Composite volume surpassed 2.9 billion.
Wholesale inventories fell 0.2% in June after declining 0.6% in May, the Commerce Department reported.
The dollar DXY +0.13%  edged higher against other major currencies, while the yield 10_YEAR -0.46%  on the 10-year Treasury note fell a basis point to 2.555%.
Crude prices CLU3 +2.62%  gained $2.57, or 2.5%, to $105.97 a barrel, down 0.9% for the week, and gold GCZ3 +0.26%  rose $2.30 to end at $1,312.20 an ounce, up $1.70 from the prior week’s finish. 

Earnings ahead

Of the 446 companies in the S&P 500 that have reported results for the second quarter of 2013, 67% have beaten earnings expectations, while 54% reported revenue above estimates, according to Thomson Reuters analyst Greg Harrison.
In the coming week, 13 S&P 500 companies are expected to report quarterly earnings, with Dow components Cisco Systems Inc. CSCO -0.79%  and Wal-Mart Stores Inc. WMT -0.45%  among them.
Cisco was off 0.8% after a J.P. Morgan analyst upgraded his view of its shares to neutral from underweight ahead of the technology company’s release of its fiscal fourth-quarter earnings on Wednesday.
Discount retailer Wal-Mart is expected to report on Thursday.
Friday’s notable movers included shares of Gap Inc. GPS -3.12% , down 3.1%, after a Susquehanna Financial Group analyst cut his rating to neutral from positive, a day after the clothing retailer reported July sales at stores open at least a year climbed less than Wall Street expected.
J.C. Penney Co. shares JCP -5.78% dropped 5.8% after the department-store chain’s chairman voiced support for its CEO. Bill Ackman’s Pershing Square Capital Management LP, the company’s biggest shareholder, wants J.C. Penney to find a new chief executive.
Monster Beverage Corp. MNST +0.36%  rose 0.4% after the energy-drinks distributor reported quarterly sales. 

Shares of BlackBerry Ltd. BBRY +5.74% jumped 5.7% following a media report that the smartphone maker is open to going private.
NRG Energy Inc. NRG -2.04% slipped 2% after the company said second-quarter profit slumped 48% and lowered its guidance for 2013 adjusted earnings. Inc. PCLN +0.00% shares jumped 3.9% a day after the online-travel business reported a 24% rise in second-quarter earnings, with sales growth driven by its hotel and rental-car businesses.
U.S. stocks on Thursday ended in positive territory for the first day this week, buoyed by stronger-than-expected Chinese trade data

Kate Gibson is a reporter for MarketWatch, based in New York.

Wall Street at Close Report by CNBC August 09, 2013: Stocks post worst week since June as Dow drops 1.5%

Stocks post worst week since June as Dow drops 1.5%

Stocks finished the week in negative territory, with major indexes logging their worst week since June, as investors found little reason to buy following the market's recent highs and amid ongoing worries about when the Fed may start to wind down its stimulus program.
"This is continuation of a sideways market that we've been experiencing for much of the week," said Cam Albright, director of asset allocation at Wilmington Trust Investment Advisors. "There's no big catalyst that's out there that's pushing us forward or backwards."

(Read more: Marc Faber expects a crash—but likes these stocks)
Name Price Change %Change
DJIA Dow Jones Industrial Average 15425.51
-72.81 -0.47%
S&P 500 S&P 500 Index 1691.42
-6.06 -0.36%
NASDAQ Nasdaq Composite Index 3660.11
-9.02 -0.25%

The Dow Jones Industrial Average finished off its lows but still ended in the red, dragged by Disney and Home Depot. The Dow was down nearly 130 points at its session low.

The S&P 500 and the Nasdaq also ended lower. The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded above 13.
This week marks the weakest weekly volume on the S&P 500 since August since 2006.
Most key S&P sectors finished lower, led by telecoms and utilities.
SaP going to '1,500 or below': Strategist
There's a lot of risk in the stock market that many investors are ignoring, Mike O'Rourke of Jones Trading says.
Major averages have been dented this week amid uncertainty about when the Fed may start winding down its stimulus program. The Dow and S&P 500 have declined more than 1 percent each for the week. The Dow is poised to log its first weekly drop in seven. (Read more: Art Cashin: The market 'check engine light' is on) Most recently, Dallas Fed president Richard Fisher reiterated on Thursday that the central bank will likely begin cutting back on its massive bond-buying stimulus in September as long as economic data continues to improve. "The assumption has been that September is a likely start date and the only thing that would hold them back is very disappointing economic news between now and then," said Albright. "But I'm not sure if the market is prepared for an abrupt end of the QE program…the concept of tapering has led market participants to believe this would be a more drawn out event." China's benchmark Shanghai Composite rallied 1 percent for the week to close above the 2,050 mark, lifted by better-than-expected industrial output numbers for July, plus a healthy increase in fixed asset investment in the first seven months of the year. Meanwhile, Chinese consumer prices were unchanged in July on the previous month, and producer prices fell an annualized 2.3 percent. "More spending is called for, while further acceleration in credit growth is discouraged. This approach requires significant improvement in capital allocation efficiency to work. There is no quick magic, and so patience and tolerance is still required," analysts at SG Global Economics wrote in a research note. (Read more: China's factories remain in deflation, producer prices show) Meanwhile, a marginally weaker yen helped Japan's benchmark Nikkei index rebound from the previous day's one-month low. Dollar-yen traded at the 96.60 handle, after hitting a new seven-week low overnight.
JCPenney held losses after hedge-fund manager Bill Ackman sent a second letter to the retailer's board, demanding a new meeting of the board and called for chairman Thomas Engibous to be replaced. Meanwhile, sources close to JCPenney said Ackman's facts in the letter are incorrect. BlackBerry soared after Reuters reported that the troubled smartphone maker is looking to the possibility of going private. Shares have plunged more than 30 percent in the last three months amid increasing competition from Apple and Samsung. Among earnings, surged after the travel website posted earnings that beat expectations and handed in a strong outlook. The stock is on the cusp of crossing above $1,000 a share. At least nine brokerages lifted their price targets on the company. Lions Gate rose after the entertainment company posted earnings and revenue that topped Wall Street estimates. (Read more: Taking stock of S&P quarterly earnings) On the economic front, June wholesale inventories slipped 0.2 percent in June, missing expectations for a gain of 0.4 percent, according to a Reuters poll. Inventories declined 0.5 percent in the month prior.
—By CNBC's JeeYeon Park (Follow JeeYeon on Twitter:

The Conscience of a Liberal Unacceptable Prejudices by Paul Krugman: NYT | Opinion Today August 2013

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The Telegraph Front Page PM - News August 09, 2013: Spain to take 'all necessary measures' to defend Gibraltar interests

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The Economist Management Thinking August 09, 2013: Business Across Borders:

This week we bring you the third article from our Business across borders series sponsored by Reed Smith. In Smoothing the path we question whether international business transactions have become more or less difficult in recent years; we examine the types of trade barriers companies face; and we take a look at the hidden traps of doing business abroad.

On our blog site Zoe Tabary, an EIU editor, interviews Thulasiraj Ravilla, executive director at Aravind Eye Care System, which delivers high-quality low-cost ophthalmological care to some of India's poorest people.

Finally on October 24th we will be hosting the Brazil Summit in São Paulo. We will gather together leading experts and businesspeople to examine how Brazil can stay on its path to economic success, and which new drivers of economic growth it much unlock on the way.


Denis McCauley
Editorial Director, EMEA

June 2013 wholesale inventories were $499.7 billion, down 0.2 percent from the revised May level but up 2.9 percent from one year earlier..: ESA | Monthly Wholesale Trade (June 2013).pdf

Economics and Statistics Administration Logo
June 2013 wholesale inventories were $499.7 billion, down 0.2 percent from the revised May level but up 2.9 percent from one year earlier. Sales were $425.9 billion, up 0.4 percent from the revised May level and up 5.6 percent from June 2012.

European Markets at Close Report by MarketWatch August 09, 2013: Europe stocks rise for second day; up 0.6% on week.

Europe stocks rise for second day; up 0.6% on week

By Sara Sjolin, MarketWatch
LONDON (MarketWatch)European stock markets rose for a second straight day on Friday, sending the benchmark index higher for the week, after upbeat data from China fueled optimism about that country’s economy. 

The Stoxx Europe 600 index XX:SXXP +0.58%  added 0.6% to close at 305.92, building on a 0.5% gain from Thursday. It ended the week up 0.6%. 

China's reform road map

China's economy is showing signs of stabilizing, with July’s trade and inflation data painting a positive picture. The WSJ's Mariko Sanchanta and Tom Orlik discuss what to expect as China's leaders debate far-reaching reforms. 

Several of the region’s prominent firms reported positive surprises with their earnings over the week.
“Corporate earnings have been a bit better and I think we had fewer negative disappointments than we’ve had in a while. It has been good enough to justify the gains we’re seeing,” said Ian Williams, equity strategist at Peel Hunt.
Data out of the euro zone this week have also pointed to an improvement in the economy. The release of second-quarter gross-domestic-product data next week will further provide an insight into the health the of the economy. Read: Goldilocks with a European accent: What strong data means for QE
“But I think it’s too early to be absolutely confident about the recovery [in Europe]. The optimism is a bit overdone. The worry is the labor market—we still have plus 10% unemployment in France and plus 20% in Spain. There’s a lot more work to be done in Europe,” Williams added.
Among biggest movers in the pan-European index on Friday, shares of Royal KPN NV NL:KPN +16.00%  climbed 16% to 2.32 euros ($3.10) after Mexican telecom firm America Movil SAB de CV MX:AMXL +1.95%  said it plans to make an offer for the Dutch firm at €2.40 a share.
Shares of Novozymes AS DK:NZYMB +3.01%  rose 3% after the industrial enzymes producer reported a 13% rise in second-quarter profit.
Shares of Nestlé SA CH:NESN -1.34%  dropped 1.3%, adding to a 2.2% loss from Thursday, when the maker of Kit Kat chocolate bars indicated it is facing challenges in both emerging and developed markets.
More broadly, markets tracked gains in Asia, where Hong Kong stocks climbed after data showed July consumer prices in China rose 2.7%. The number matched the rate in June, but was slightly weaker than expectations. Additionally, Chinese industrial production grew at the fastest pace since February, rising 9.7% from a year earlier.
The data came a day after better-than-expected trade data from China also helped boost sentiment.

MarketWatch/William Watts
European stocks rise on Friday, helping send the Stoxx Europe 600 index 0.6% higher on the week.
Commodity prices are highly correlated with the expectations of Chinese growth, and prices have been volatile in recent months alongside concerns of a slowdown in the country’s economy.
“However with more consistent data coming through in China, this is likely to provide an optimistic backdrop for the sector which should have a very positive impact for U.K.-listed global mining companies,” said Rebecca O’Keeffe, head of investment at Interactive Investor, in a note.
That was also reflected in Friday’s trade where mining firms posted some of the biggest gains.
Shares of BHP Billiton PLC UK:BLT +3.40%   BHP +1.85%   AU:BHP +1.78%  added 3.4%, Rio Tinto PLC UK:RIO +5.01%   RIO +4.57%   AU:RIO +1.29% picked up 5% and Anglo American PLC UK:AAL +6.05%  gained 6.1%. Metals prices were higher.
The gains for miners helped lift the FTSE 100 index UK:UKX +0.82%  0.8% to 6,583.39.
The London benchmark, however, closed with a 1% weekly loss. The index sank 1.4% on Wednesday after the Bank of England pledged to keep interest rates low until unemployment falls below 7%, with markets interpreting the statements as less dovish than expected.
In France, traders shook off a downbeat reading Friday on the industrial sector, with the CAC 40 index FR:PX1 +0.30%  rising 0.3% to 4,076.55 and ending the week up 0.8%. Data from statistics bureau Insee showed industrial production unexpectedly dropped 1.4% in June from May, with output dropping across most sectors. Economists polled by Dow Jones Newswires had expected a 0.1% rise.
Among other country-specific indexes, Germany’s DAX 30 index DX:DAX +0.24%  rose 0.2% to 8,338.31, but lost 0.8% on the week. 

Sara Sjolin is a MarketWatch reporter based in London. Follow her on Twitter @sarasjolin.

European markets at Close Report by CNBC August 09, 2013.

European shares close higher on China data; miners rally

European shares closed higher on Friday, boosted by mining stocks which received a lift from broadly positive Chinese data, as well as a strong performance from European bank stocks.
The pan-European FTSEurofirst 300 index provisionally closed higher.

China's industrial output jumped 9.7 percent in July from the year ago period, government figures showed on Friday, beating a market forecast by Reuters for a 9 percent again.
Plus, Chinese trade figures on Thursday surged past expectations, supporting European shares and increasing hopes that the world's second biggest economy is stabilizing after more than two years of slowing growth.

Precious metals producer Fresnillo gained 6.89 percent. Miners Anglo American and Randgold Resources were also among the top gainers on the FTSE index, up 4.19 percent and 4.02 percent respectively.

Dennis Gartman, founder of the Gartman Letter, says there is credence to the data and it proves the economy is still chugging along.
(Read more: China market bounce: trend change or false alarm?)

"China, I'm afraid is not slowing down as much as everybody wants to have us believe that China's slowing down. I understand that brilliant people are out there telling me that China's slowing. I haven't seen data that shows me that's true," Gartman said.
However, the Chinese data was not good enough to help U.S. stocks in early trade, with major indexes on track for their worst week since June. Shares have been dented this week amid uncertainty about when the Federal Reserve may start winding down its stimulus program.
  Name Price   Change %Change Volume
FTSE FTSE 100 Index 6583.39
53.71 0.82% 619237687
DAX DAX Index 8338.31
19.99 0.24% 89030345
CAC 40 CAC 40 Index 4076.55
12.23 0.30% 87477759
IBEX 35 IBEX 35 Idx 8735.50
63.70 0.73% 204533088

(Read more: China data blitz points to stabilizing economy)

Back in Europe, Mexican billionaire Carlos Slim's telecom giant America Movil (AMX) said on Friday it is launching an offer to purchase all shares of Dutch telecom group KPN at 2.4 euros per share. The news sent KPN stock soaring, up 16.6 percent.

(Read more: Why Carlos Slim's KPN bid may be all about Germany)

German's biggest lender Commerzbank was the top gainer on the DAX on the back of better-than-expected quarterly results on Wednesday and news that CEO Martin Blessing pledged he would not step down until his reform program had been completed. Shares in the bank were up again 4.53 percent. Credit Suisse also upgraded its price target on the stock.