Gold has traded between $1,319 and $1,327 so far today…as of 10:30 am Pacific, bullion is up $4 an ounce at $1,322…Silver is 15 cents higher at $19.00…Copper has jumped a nickel to $2.15…Crude Oil is off another $1 a barrel to $43.90 while the U.S. Dollar Index has fallen one-quarter of a point to 95.28 (strong resistance band between 96 and 97)…
Yet another reason to be invested in Gold and Gold stocks: As Japan struggles to meet its 2% inflation target, the Bank of Japan is planning to make its controversial negative interest rate policy the centerpiece of future monetary easing, the Nikkei Business Daily reported last night…Prime Minister Shinzo Abe said that the impact of the Bank of Japan’s monetary policy is gradually spreading to the real economy and that the nation was on its way to escaping deflation (whatever you say, Abe)…
Desperate measure for desperate times…of course we’ve been hearing for years that Japan is about to slay the deflation dragon and it hasn’t happened yet (probably won’t until the Japanese carry out some difficult reforms that may not be popular with voters)…the government of Japan and the BOJ are now engaging in an extremely delicate balancing act with potentially dangerous consequences…
No Inflationary Pressures In U.S.
U.S. import prices fell for the first time in 6 months in August on declining petroleum and food costs, pointing to a continuing tame inflation environment that will further encourage the Federal Reserve to keep interest rates unchanged next week…prices decreased 0.2% in August after an unrevised 0.1% gain in July…
Oil Update
Oil prices have been bouncing around today, rallying briefly after fresh data showed a surprise draw in U.S. Crude stockpiles…commercial Crude inventories fell by 559,000 barrels to a total of 510.8 million barrels in the week through September 9, the U.S. Energy Information Administration reported this morning…analysts expected the EIA to cite a build of 3.8 million barrels…last week it was reported that inventories fell by 14.5 million barrels for the week ending September 2, the biggest weekly drawdown since 1999 as imports to the Gulf Coast hit a record low…
However, oversupply concerns continue to hang over the global Oil market…Commerzbank said in a note today that the delay in demand-supply rebalancing is largely due to a rise in production from OPEC members and that the market would be balanced already if OPEC had maintained its production at May’s levels. “Rather than talking about capping Oil production as it was planning to do at the end of September, OPEC would be better advised to think about reversing the production growth of recent months,” Commerzbank analyst Carsten Fritsch said…Daniel has more comments on the Oil demand/supply debate in Daniel’s Den…
“Slow Growth” Is Now Reality – Bank Of Canada Deputy Governor
Some candid talk today from a central banker, Bank of Canada Senior Deputy Governor Carolyn Wilkins who addressed the Official Monetary and Financial Institutions Forum in London, England: âGiven the added challenges of a number of sovereign debt crises, an Oil price shock and – most recently – the unfolding fallout from Brexit, itâs understandable that we have devoted a lot of energy to avoiding another financial meltdown and keeping the recovery on track. We have to adapt to this new reality of lower potential growth. The faster we do this, the safer the financial system will be.
“Slow growth worries me as a central banker, not only because it reduces our room to manoeuvre to achieve our inflation target. It also worries me because slower potential growth materially increases risks to financial stability.”
The weakening of the global economy can be attributed to two factors, Wilkins said – labor supply and productivity…both are rising more slowly than in the past…
Wells Fargo Scandal
No wonder Americans are sour on “the system” these days…the Wells Fargo executive who oversaw a unit that created almost 2 million unauthorized customer accounts is set to retire from the company with a nearly $125 million payday, and reports say the bank isnât likely to cut the strings on her Golden parachute as she walks out the door…
Carrie Tolstedt, 56, announced her retirement in July, effective at the end of the year, and is set to receive $124.6 million via stock, options and restricted shares accrued during her 27 years at Wells Fargo, Fortune reported Monday…Tolstedt headed the infamous community banking unit where employees (more than 5,000 of them were fired in this astonishing case of massive fraud)Â created unauthorized deposit accounts and credit accounts in an effort to meet sales goals (and where did the pressure come from to meet those targets?)…
“There are two possibilities: Customer abuse was part of business model, in which lots of high-ranking people need to go to prison,” Bart Naylor, a financial policy advocate for Public Citizen, told The Washington Post. “Or the bank is too big to manage, and folks high up donât even know that laws are being broken a few levels down.”
Energy East Debate
Former Prime Minister Brian Mulroney had some sound advice for current PM Justin Trudeau while addressing law students at the University of Calgary yesterday…he said the best way to get Canada’s economy back on track is for the Liberal government to approve the controversial Energy East pipeline through the forging of a new strategy with key players including First Nations, the provinces, municipalities and the Oil sector…
âThe Canadian agenda under the Prime Ministerâs personal direction would provide hundreds of billions of dollars in new investments, millions of new jobs, bring East and West much closer together, and be as transformational and beneficial to the country as any major policy initiative undertaken in Canada in the last 70 years,â Mulroney stated…
Trudeau faces a series of high-profile energy decisions over the next 3 months, including a final cabinet ruling on Kinder Morganâs Trans Mountain proposal and a legal appeal related to Enbridge Inc.âs Northern Gateway pipeline…he’ll also decide on Petroliam Nasionalâs Pacific Northwest Natural Gas Project, while TransCanada Corp.âs Energy East pipeline is due for a decision in about 2 years (if that process ever gets untangled)…
The Most Reliable Dow Chart There Is!
Plenty of volatility in the Dow in recent days and that has stirred up some fear and created typical calls for a near-term major sell-off…
This long-term chart from John, which has proven to be exceptionally accurate, will put things into proper perspective…
The Dow has shown unwavering support at its uptrend line that goes all the way back to early 2009 on this 10-year monthly…the 200-day moving average (SMA), currently 17648, now coincides with the uptrend line…therefore, near-term downside risk should be considered quite limited…the uptrend support was briefly violated in January but that turned out to be a tremendous buying opportunity…
We’re certainly in a period of heightened volatility (not unusual) ahead of next week’s Fed meeting…
However, given this chart, plus how the Venture is behaving, we don’t subscribe to the theory being peddled by some that the markets are about to fall off a “cliff”…that also wouldn’t fit well with the agenda of those in control in Washington, especially considering that elections are less than 2 months away…
The Dow is up 38 points at 18105 as of 10:30 am Pacific…
In Today’s Morning Musings…
1. Skeena Resources (SKE, TSX-V) intersects 16.2 g/t Au over 13.5 m 200 m into the footwall below the historic Twin zone at Snip…
2. Pure Energy (PE, TSX-V) returns favorable Lithium numbers from 3rd hole at Clayton Valley South…
3. Daniel’s Den – a psycho analysis of Mr. Market and his views on Oil…
Plus more…click here to read the rest of today’s Morning Musings and all BMR exclusive content, through a risk-free Pro, Gold or Basic package, or login with your username and password…
Any coal picks? ALI and MOX moving.
Its a shame SKE has half a billion shares out, decent results. Too many other choices out there to buy into such a bloated share structure.
Any word on CXO results?
Comment by Mmurphy — September 14, 2016 @ 10:04 am
Yes, the metallurgical coal stocks are certainly getting a strong bid with coal prices up on lower Chinese supply…
Comment by Jon - BMR — September 14, 2016 @ 10:08 am
Other coals – CSO , CAD
Eye on WMR , DPH , PMA for any decent correction
Comment by dave — September 14, 2016 @ 10:17 am
thought this article might be of interest:
http://www.reuters.com/article/us-usa-climatechange-idUSKCN11K0BC
Comment by Mmurphy — September 14, 2016 @ 10:30 am
Well, technically Carrie got the job done for Wells Fargo.
Comment by Daniel — September 14, 2016 @ 10:41 am
Hi Guys! Just curious on your thoughts on SIR, RRS, CCE, FMS and TLO. BTW, thanks for bringing up CNZ. I actually was looking at IZN. Both look like good plays.
Comment by ARIMA — September 14, 2016 @ 1:09 pm
Wow – that’s all we need, to have Chad Day calling in the military!…
National Post reports tonight:
Defence Minister Harjit Sajjan is considering a request to give First Nations the power to directly call in the military when their treaty, environmental and other rights are threatened.
Ron Swain, vice-chief with the Congress of Aboriginal Peoples, told Sajjan during consultations with indigenous groups Wednesday that aboriginal communities deserve the same rights as provincial governments, which have the authority under the National Defence Act to call in the military to fight civil unrest and during other crises.
âWe believe, in protecting our sovereign territory and our issues around environmental concerns, we should be able to trigger the same response and have our Armed Forces defending our treaties and our territories,â Swain said during a break in the closed-door meeting in Winnipeg that included about a dozen aboriginal leaders and academics.
Comment by Jon - BMR — September 14, 2016 @ 6:30 pm
“Wow â thatâs all we need, to have Chad Day calling in the military!⌔
Ya that’s definitely over the top.
Comment by Mmurphy — September 15, 2016 @ 9:07 am
they’ll all be in Mali doing peacekeeping, so hopefully the call gets put on Hold, and resolved as it should be , thru discussions
Comment by David — September 16, 2016 @ 7:54 am