I have several items that merit your attention today but first, here's an update of the charts.
I'm still hopeful that a rally is coming. The technical picture remains positive and the open interest numbers continue to trend well. I'll also be interested to see the CoT numbers when they come out later today. For now, the charts a virtually unchanged from earlier this week.
OK, onto the news. This first item is truly disturbing. I must admit that I saw these headlines but never had a chance to go back and delve deeper. Well, thankfully, Dave in Denver took the time to digest and interpret the situation. All of the sordid and disgusting details are plainly laid out for all to see here. Please take time, right now, to leave this site by clicking on the link below. Read Dave's article and then return:
So, let me see if I've got this straight. JPM reports "earnings" of $1.02/share for the quarter, well ahead of the $0.92/share expectation. The media reports this as great news and proof that the banks and overall financial system continue to recover and improve. However, of the $1.02, 29 cents came from an accounting gimmick. Without the gimmick, JPM would have reported just $0.73/share, which would have been a complete disaster.
That's bad enough on its face but let's go back and re-visit, courtesy of the plain-English supplied by Dave, how they "found" the 29 cents in the first place. Here's how this works:
1) JPM issues bonds (debt) at 100 cents on the dollar. At maturity, these bonds must be retired by repaying principle to the bondholders at 100 cents on the dollar.
2) These bonds are currently trading at 80 cents on the dollar.
3) Because, theoretically, JPM could buy back all of the bonds at the current price and retire the issue prematurely, JPM theoretically could save themselves 20 cents on each dollar. Theoretically.
4) Never mind the reasons the bonds are trading at a discount and never mind that JPM has neither the cash nor the intention of purchasing and retiring the debt in question.
5) Regardless, simply because the bonds are trading at a discount, JPM is allowed to claim the theoretical advantage of retiring the debt at 80 cents on the dollar as actual earnings!
6) This is an outright and upfront fraud akin to the accounting of Social Security or some other insulated-from-scrutiny government program.
7) Perhaps more disheartening is the collusion of the unindicted co-conspirators in the financial media who report these "great numbers". You're left with only two choices:
a) For whatever reason, the media is purposefully misleading the public.
b) The media that reported these numbers are utterly and completely clueless regarding the subject matter.
Which is it? It has to be one or the other?
In the end, all of this simply continue to fit the narrative here. The great Government-Financial Ponzi is coming to an end. It is inevitable regardless of how long the lies and distortions continue.
Next up, another story that I've had minimized on my screen for a while. Like Venezuela, Mexico is discovering that the gold that they think they own in unallocated accounts, may not actually be there for delivery. As more and more sovereign nations realize that they have been scammed by the LBMA/Comex system, a "run" on the bullion banks will develop. Once again, this only proves the adage: "the only gold you truly own is the gold you hold in your own two hands".
Also, one of the main guys behind this Mexican effort is Hugo Salinas-Price. Mr. Salinas-Price is a tireless advocate of sound money and he was one of the feature presenters at Ned Naylor-Leyland's conference back in January. If you haven't yet seen his presentation, I urge you to take some time to watch it. Linked below:
Lastly, I found this little ditty on ZH a couple of days ago. I know that many of you are concerned about confiscation. As you know, I think that, in this age of instant information and communication, a gold confiscation plan would be nearly impossible to implement. However, what the hell do I know? That's just my opinion. I could be wrong so, therefore, I urge you to read this:
OK, that's all for now. The metals are trying to move higher so maybe we can end the week on an UP note. We'll see. Keep the faith! TF