US 5 year yield falls below the 0.20% to a new low record

Gold and so are off low levels

the US 5 yield has fallen below the 0.20% level to a low yield of 0.1949%. That is a new all time low.  The high yield today reached 0.2232%.

Gold and so are off low levels_

The fall yield has helped to send gold back up toward unchanged and trades above and below the unchanged level. Silver is also higher.
Technically, the 5 year yield has been moving steadily to the downside since last Wednesday. On that day, the price tested its 200 hour moving average (green line in the chart above). The low yield on Friday reached 0.2044% and bounced. Today, the move to the down side has resumed.
The 10 year yield is also lower on the day but remains still above its March 9 all-time low yield level of 0.3137%. The yield is currently at 0.5118%

Gold extends decline in third day of losses

Gold falls to the low of the day

Gold falls to the low of the day
Gold sank through $1700 and continued down to a session low of $1694 in a $16 decline. It’s the third day of selling this week and is being helped along by a strong dollar today.
The drop wipes out the mid-may rally and puts gold back in the middle of the April range.
The better risk tone and big moves in stocks are sparking flows out of gold and into risk assets.
Technically, this looks like a false break or at the very least a retest of the old range.
If central banks are the drivers of this rally, you have to worry about a scenario like the Bank of Israel early this week, where they upgraded growth forecasts and hinted at a time on the sidelines. I can easily see the Fed following the same playbook and that would undermine the short-term case for gold. It’s the same thing on the fiscal side where the better mood will slow the appetite for spending.

India’s gold demand fell 9 per cent in 2019 but set to recover: World Gold Council

Indias gold demand was 9 per cent lower in 2019, at 690 tonne, primarily owing to the sharp surge in prices, however, it is expected to rebound in 2020, the World Gold Council (WGC) said on Thursday.

The council said India’s gold demand will be in the range of 700-800 tonnes in 2020 from 690 tonnes in 2019.

“Looking ahead, 2020 we expect policy-led and industry-led initiatives to bring a marked shift in making the industry more transparent and organised,” said Somasundaram PR, Managing Director, India, World Gold Council.

He added that the government has already made hallmarking mandatory on January 15, 2020 with a transition period of one year for the trade to sell or change its existing non hallmarked inventory.

“This is an overdue reform and a positive step towards making the Indian gold more trustworthy. These and other changes to follow are significantly positive for the long-term sustainability of demand, especially for the compliant and the organised,” Somasundaram added.

However, the report said that short-term challenges remain as large sections of the industry compete on low margins and fear tax uncertainty, leaving little incentive for long term investments and modern trade practices.

Globally, WGC said that Gold demand fell 1 per cent in 2019 as a huge rise in investment flows into ETFs and similar products was matched by the price-driven slump in consumer demand.

Besides, the central bank net purchases in 2019 were remarkable the report said. The annual total of 650.3 tonne is the second highest level of annual purchases for 50 years.

In total, 15 central banks increased their gold reserves by at least one tonne in 2019.

Demand was exclusive to emerging market central banks looking to bolster and diversify their overall reserve, WGC said.

Read Links and Update yourself

  • China turns tables on AAA debt time bomb nations (Bloomberg)
  • Gold at new record high after Saudi reserves double (FT)
  • Germany and France examine two-tier euro (Telegraph)
  • So that’s why investors can’t think for themselves (WSJ)
  • Failed AAA-deal rated Rembrandt spurs outcry (Bloomberg)
  • Medvedev sees chance for new world order (FT)
  • Amid the crisis, Wall Street touted BP stock (Reuters)
  • Gold reclaims its currency status as the global economy unravels (Telegraph)


IMF is $318 billion short of solvency

Those observing the emperor’s lack of clothing are multiplying. Earlier today, someone opened their mouth, and remarked on the blatantly obvious. Next thing you know Hungarian CDS was 30% wider, Romanian bond auctions were failing, the euro was tumbling, the PPT was scrambling, US markets closed green with nobody trading, etc. Yet the “letting the genie out of the bottle” award of the day has to go to the head of IMF’s policy-steering committee, Youssef Boutros-Ghali who said that the IMF is essentially insolvent in its current form of being the go to backstop for a European bailout. “If we are going to start including funds made available to Europe, then the IMF is not properly resourced,” Youssef Boutros-Ghali told Reuters, adding that IMF members were talking of doubling the amount of SDRs. The means the IMF is $318 billion short of solvency. And what is the IMF long? Why gold…3,005 tonnes worth.

The IMF has to have more resources after the support for Greece and needs to “very significantly” increase the amount of special drawing rights, the head of the Fund’s policy-steering committee said on Friday.

What does this mean in English? The IMF currently has 204 billion in allocated SDR to member countries (or $318 billion). Boutros-Ghali has basically said that in order to preserve its front-man status as a world bailout force (just because the Fed knows that the political whiplash of it being the bailout provider of last resort would mean the end of it, thus needing a strawman such as the IMF), the IMF will need to raise another $318 billion. Where will the IMF get that money? Here’s an idea: the IMF holds 3,005 tons of Gold. At today’s fixing, this equates to just over $116 billion (and much more should the price of gold mysteriously skyrocket). Of course, any fiction that the SDR is backed by gold will then disappear, but it’s not as if anyone even remotely pretends that any fiat currency (and the SDR is no exception) has any value left whatsoever. And since the US will end up having to fund the bulk of the SDR allocation, at least US taxpayers would be on the hook for a far more manageable $200 billion that the IMF needs in order to fully bail out Greece and everyone else in Europe.


Jim Rogers: Stocks To Be Crushed Any Day Now

Governments need to tighten their monetary policies more according to Jim Rogers. Such tightening will result in stocks being crushed nevertheless.

Bloomberg: “We’re overdue for a correction” said Rogers, chairman of Rogers Holdings, said in an interview in Hong Kong. “Stock markets around the world have been going up for the past 10 months.”

“I don’t think anybody has tightened enough. I think everybody should tighten more,” he told Bloomberg. “We have huge amounts of money printed throughout the world. It’s going to cause currency instability. It’s going to cause more inflation. It’s going to cause higher interest rates.”

An extended, related video of Jim Rogers with Bloomberg is below, start from 11:00 for Jim Rogers. He talks across stocks, stimulus, commodities, and gold in particular.

One of the oddest things discussed however, toward the very end of the video, at 27:00, is how Jim Rogers is long both the U.S. dollar and gold. He’s also long the Japanese yen even though in his own words, it, like the dollar, is a ‘terribly flawed currency’.



Control your emotions until the round is over

cg57451This is a good one and something we can all learn from both when making good and bad trades. If you can delay your emotional celebrations or harsh criticisms after the trading day (or trading week) is over, that’s to your own advantage. Far too often traders fall trap to what I call “trading on tilt” where they try to wreak revenge on the market by making more bad trades after the first bad one to get back to even. In addition, if you’re doing really well and making great trades, put your guard up. It is true that the times we are most vulnerable to catastrophic losses usually follow the times we’ve experienced a very hot hand and have convinced ourselves that everything we touch turns to gold.

Time to Buy Diamond plus listed stocks


If you know anyone in the Diamond business, they’ll tell you that they are in a real “crisis”.
Prices have fallen down sharply.You can learn more about this industry via the site powered by the
.Rapaport report
I find real value in large stones today.Feel safer in that industry compare to Gold right now.
The real good news ? Rough diamonds are really hard to get now 🙂

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