The NSA announced Friday that they would stop the controversial program which sweeps up all emails and text messages which an American exchanges with someone overseas that makes reference to a real target of NSA surveillance.

By way of background, if Russia’s Putin was an NSA target, and an American received an email from a Russian saying “I hate Putin”, then that American could be surveilled by the NSA.

Washington’s Blog asked Bill Binney what he thought of the NSA’s announcement.

Binney is the NSA executive who created the agency’s mass surveillance program for digital information, who served as the senior technical director within the agency, who managed six thousand NSA employees, the 36-year NSA veteran widely regarded as a “legend” within the agency and the NSA’s best-ever analyst and code-breaker, who mapped out the Soviet command-and-control structure before anyone else knew how, and so predicted Soviet invasions before they happened (“in the 1970s, he decrypted the Soviet Union’s command system, which provided the US and its allies with real-time surveillance of all Soviet troop movements and Russian atomic weapons”).  Binney is the real McCoy.  Binney has been interviewed by virtually all of the mainstream media, including CBS, ABC, CNN, New York Times, USA Today, Fox News, PBS and many others.

Specifically, we asked Binney:

Do you buy it? http://j.mp/2plPA1u 

Or do you think they’re just collecting under a different authorization/program?

Binney responded:

Short answer, NO.

 

This is a farce given the bulk continuous domestic data collection and storage from the Upstream programs: Fairview, Stormbrew and Blarney. [Here’s background on Fairview/Stormbrew/Blarney.]

 

This FAA 702 [Section 702 of the Foreign Intelligence Surveillance Act] has been a charade from the beginning. [Specifically, the NSA is spying on all Americans under Executive Order 12333, and only talking about Section 702 to confuse people as to what they’re doing.]

 

It was a way to make people/congress/judiciary think that they were trying to conform to the law.

And, by spreading false information, which our useless MSM fail to challenge, it’s a way of subverting our republic – all done in secret with only a few people in the know of what really is going on.

 

Meanwhile in the background, NSA through program “Muscular” was unilaterally tapping the fiber lines between Google and Yahoo and others data centers; so that when they backed up their data between centers, NSA got it all and the companies did not even know that was happening.

Absolutely nothing has changed.

First published here: http://j.mp/2plPS8C

Last week, we talked about the effect of the French election on the gold and silver markets, and noted:

Of course, traders want to know how this will affect gold and silver. As we write this, we see that silver went down 30 cents before rallying back up to where it closed on Friday. Gold went down about $20, and then half way back up.

At this point, we are not sure if the metals are supposed to go up because more printing. Or go down because the euro constrains France from printing. Or silver at least should go up because the economy is going to be better with France remaining in the Eurozone. Or go down because the ongoing malaise will only progress as it has been. Or some other logic… and the price gyrations this evening show that traders don’t agree either.

It didn’t take too long. Here is what happened to silver this week. The graph below shows the price of silver in real money (i.e. gold).

The Price of Silver in Real Money

Silver has been falling for going on one year, but clearly since March 1. After one last hurrah at the end of March, it has been taking the elevator down. And by its fundamentals it should be quite a bit lower—0.0125.

In any case, we are interested in watching what the fundamentals of the metals are doing. We will take a look at the graphs below, but first, the price and ratio charts.

The Prices of Gold and Silver

Next, this is a graph of the gold price measured in silver, otherwise known as the gold to silver ratio. It had another major move up this week, after a major move up last week.

Last week, we said:

If prior peaks are an indication, there may be a spot of resistance at 72.5 (+0.8 above Friday’s close) and another at 73.25. If the ratio should go over these levels, then it may go all the way to its fundamental level (discussed below).

Well, it broke those levels and ended the week just under 74.

The Ratio of the Gold Price to the Silver Price

For each metal, we will look at a graph of the basis and cobasis overlaid with the price of the dollar in terms of the respective metal. It will make it easier to provide brief commentary. The dollar will be represented in green, the basis in blue and cobasis in red.

Here is the gold graph.

The Gold Basis and Cobasis and the Dollar Price

The scarcity (i.e. the cobasis, the red line) was on the rise this week. It makes sense, that as the price of gold drops (which is the mirror of what this graph shows, the price of the dollar in gold milligrams) the metal becomes scarcer. This means speculators are selling their paper. If owners of metal were selling, then the metal would not become scarcer and might even become more abundant.

However, it only became a little scarcer while the price dropped almost twenty bucks. So our calculated fundamental price fell $15 to $1,274, a few bucks above the market price.

Now let’s look at silver.

The Silver Basis and Cobasis and the Dollar Price

In silver, the price fell a lot. 72 cents. The cobasis rose (i.e. abundance dropped and scarcity increased).

Last week, we asked:

Some speculators definitely got flushed. However, the question is how many and how much?

Clearly it happened to more of them this week. And, unless the fundamentals get stronger, it is likely to flush even more leveraged futures positions. Our calculated fundamental price fell three cents this week, now a buck thirty under the market.

© 2017 Monetary Metals

First published here: http://j.mp/2pmecY7

First published here: http://j.mp/2qjvFBR

By Chris at http://j.mp/22bDW4a

Market dislocations occur when financial markets, operating under stressful conditions, experience large widespread asset mispricing.

Welcome to this week’s edition of “World Out Of Whack” where every Wednesday we take time out of our day to laugh, poke fun at and present to you absurdity in global financial markets in all its glorious insanity.

While we enjoy a good laugh, the truth is that the first step to protecting ourselves from losses is to protect ourselves from ignorance. Think of the “World Out Of Whack” as your double thick armour plated side impact protection system in a financial world littered with drunk drivers.

Selfishly we also know that the biggest (and often the fastest) returns come from asymmetric market moves. But, in order to identify these moves we must first identify where they live.

Occasionally we find opportunities where we can buy (or sell) assets for mere cents on the dollar – because, after all, we are capitalists.

In this week’s edition of the WOW: 5 head scratchers

Today we're going to blast through a few shards of information that have bloodied my windshield recently... but first some context.

The world is a web, interconnected at multiple levels but in it's entirety it is one giant capital flow chart. This is why looking at events, trends and prices from multiple angles and with historical context is critical. It means that in order to understand global capital flows and the world at large investors needs to be generalists. Specialisation renders one towards narrow focus by necessity. There is nothing wrong with narrow focus when you need it so long as it can be brought into focus through a broad understanding.

Let's therefore look at a number of topics.

1: Saudi Arabia Got WHAT??

In what I dearly wish was a delayed April fools joke the United Nations just elected Saudi Arabia to the Woman's Rights Commission. No isht!

A quick reminder: this is the only country in the world which actually bans women from driving cars while implementing Sharia Law, which - for those among you who haven't read the intricacies of - permits, among other heinous things, honour killings. Way to go UN!

Question: does this make the UN complicit in crimes against humanity committed by Saudi Arabia's government? Oh, wait...

Why do I even mention this?

Davos men, the UN, the kleptocrats in Brussels, Washington, and sundry such creatures who muddy the halls of power are slowly losing their grip. This step - electing the fox in to guard the hen house - is a candid, dare I say it, balsy admittance to what we already knew. That they value money more than morals.

Why it's important is because, in their desperate desire for riches, they just dealt another blow to the establishment's credibility. Credibility rests on trust, and trust is easily destroyed. What these podium donuts have just done is provided additional kerosene to the anti-establishment fire, which - if they've not looked outside their windows - is smouldering around them.

When alternatives for governance are sought, as they are now, it doesn't require a genius to understand that views and beliefs are translated into how capital gets allocated.

Ask yourself this.. If Davos Man is increasingly shown to be the morally bankrupt sociopath he is, then at what point does faith in Davos Man's institutions and obligations (sovereign debt, I'm looking at you) get called into question?

2: Risk Party... I Mean Parity

In case you wondered what it was...

"Risk parity (or risk premia parity) is an approach to investment portfolio management which focuses on allocation of risk, usually defined as volatility, rather than allocation of capital."

Simplistically risk parity funds buy assets based on their implied volatility. If company X's volatility drops, then the models allocate more capital towards company X. By buying more of company X this has the effect of causing volatility to decline further. You get the picture. I've written about this before when talking about a bubble in dumb money.

Imagine buying companies not based on their balance sheets, income statements, or any of that boring stuff but purely on how volatile their share prices have been. Imagine... These risk parity funds are completely price insensitive. They don't even know what they're buying and will just as happily buy company X if it's trading at 200x earnings... so long as volatility is low.

Now, I would be remiss in mentioning that artificially low interest rates (thanks central banks) have had the effect of suppressing volatility in markets. These ETFs, coupled with sustained idiotic central bank policies, have created truly epic distortions in the markets.

And, just to prove that stupidity can last for quite some time, below is an updated chart on where things stand with this fun game.

 

3: Circling Back to the Saudis

I don't know about you but I find that when I need to understand something a little better it's often best to let the idea ruminate a little while before revisiting it. This allows it to mulch around in your brain, squeeze out the flatulent useless bits, and present you with what is usually be a better grasp on what really matters.

Sticking with this process, let's revisit the first topic of this week's WOW.

Curious minds should be asking the question: why on earth is the UN treating the Saudis like a cross between Mother Theresa and Ghandi?

Call me cynical but I reckon it's usually always about the money. So the fact that grand master Mohammad Bin Salman Al Saud has decided to list a sliver (5%) of Saudi Aramco may well have a little to do with this.

We know there are problems in the Kingdom. Serious problems.

And no, I'm not referring to the fact their poor citizens are governed by a bunch of psychopaths with medieval beliefs who would still be living in caves if it weren't for the black stuff under their sandals.

I'm talking about financial concerns around its now infamous decision in November 2014 to abandon its role as the global swing producer and ramp up production (even as global supplies were increasing and prices were collapsing).

Take a look at this:

Now take a look at this:

This is what a pegged currency looks like (Saudi riyal vs. USD).

I'll let you put two and two together.....

Done?

Ok.

So you're in a cash crunch, running the biggest budget deficits ever, you have to hold your currency peg which means dipping into your foreign exchange reserves, and you're fighting a wall of supply from Iran (a topic for another day but you can go listen to my conversations on Iran here and here). What do you do?

You do what anyone would do. You sell stuff.

The "Kingdom" had their first ever bond sale last year and now they're flogging Aramco to the world. The problem with all of these things is that you're needing to interact with the rest of the world a tad more and that still requires "legitimacy". A "credible" seat at the UN should help, no?

I wonder how much they paid the bankers for that seat at the UN?

We'll probably get some insight when we see where Aramco's shares get listed, and by whom.

4: The Wisdom of Age

Just in case we think we can fathom what the future holds.

How much of what Emma witnessed in her 117 years on this ball of dirt could she have seen coming in her life?

The answer is not likely many things. But... identifying just one of the completely asymmetric changes that took place would have definitely been very, very well worthwhile for Emma. Imagine having had the ability and foresight to have invested in just one of the items Sprezza lists in its early phase... and hung on.

Identifying the trends could have been done but I dare say hanging on is likely the hardest thing for us humans to do.

5: And Lastly But by No Means Least

Did you see the massive rally in the euro?

I've a great number of thoughts on this which I share with Insider members this week, including what I think is a wonderful setup. I'd encourage you to join us.

After all, there are just a few days left in April, which means you can gain access to membership at the inaugural price... before the price goes up.

Until next time, have a good weekend.

- Chris

"The biggest mistake investors make is to believe that what happened in the recent past is likely to persist. They assume that something that was a good investment in the recent past is still a good investment. Typically, high past returns simply imply that an asset has become more expensive and is a poorer, not better, investment." -- Ray Dalio, Founder, Bridgewater Associates

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First published here: http://j.mp/2pwhxSE

Please visit full archives at The Entry Points:

 

First published here: http://j.mp/2oYGPbi

Here's a special post for any Californians out there who wonder where their tax dollars are going. Some of you may have heard about this freak, who was convicted of vicious, murderous crimes and yet successfully demanded the state provide him expensive gender reassignment surgery, otherwise he might kill himself from depression.

So, in a sensible world, a razor blade would have been quietly provided and the officials could wait until their ongoing expense had addressed itself. Instead, the state fell all over itself to get the surgery that this weirdo so obviously deserved. Of course, the description of this person's crimes depends on the source. If you read a heavily left-leaning publication, you get this:

Convicted murderer Shiloh Quine, who is serving a life sentence for her role in a deadly 1980 incident in Los Angeles

Hmm. A "role" in an "incident". Doesn't sound so bad. But if you read a right-leaning publication, you get something that sounds a little closer to what actually happened:

He and an accomplice killed a man, Shahid Ali Baig, age 33 and a father of three, in 1980 while stealing his car during “a drug and alcohol-fueled rampage.” The victim’s daughter, Farida Baig, legally petitioned to have the surgery denied but was unsuccessful. She said “My dad begged for his life."

Anyway, a prison psychologist recommended the surgery after Quine said it would bring “a drastic, internal completeness” to her life. What's that? You don't have drastic and internal completeness in your own life? Tough. You didn't kill anyone, now, did you?

So the state wound up paying upwards of $100,000 to chop this murderer's dick off and give him (umm..."her") contentment. Would you like to see the result? Form a line. No shoving, please, gentlemen. Voila!

Rorrwwwwww. Amiright? She's even got a porn-star-y "Heavenly" in her name. Hot!

Naturally, though, it couldn't end there. The drastic and internal completeness didn't last forever, and the legal battles (and bills) keep piling up as these mentally ill freakazoids keep demanding more. The latest ruling declares:

California prison officials must provide for free undergarments that flatten the chest of transgender inmates at women's prisons and give transgender inmates at men's prisons access to bracelets, earrings, hair brushes and hair clips.

You see, Shiloh complained that, and I quote, the resulting beard and mustache were making the transition to life as a woman more difficult, while she also was being denied her television and enough privacy to perform required intimate post-operative procedures.

I'll leave it to your imagination as to what those intimate post-operative procedures were all about.

Not to be outdone, a legislator named - - and seriously, I am not making this up - - Representative Wiener - is now taking this battle to old folks' homes:

The "LGBT Senior Long-Term Care Bill of Rights," introduced by Scott Wiener, a state senator from San Francisco, would force nursing home workers to use a residents' preferred pronoun and prohibit "transferring a resident within a facility or to another facility based on anti-LGBT attitudes of other residents."

So next time your car slams into a bad pothole in the road or you see a homeless veteran in rags begging for money, take heart. The money is being used where it's needed most: six-figure reassignment surgery, hairbrushes, and earrings.

Can we just go back to my razor idea?

First published here: http://j.mp/2pLS6Qj

Via The Daily Bell

Say what you will about Bitcoin–whether it is a real currency, a government conspiracy, or a Ponzi scheme–but for one Venezuelan man, it was a very real ticket out of a crumbling socialist country.

Guillermo Hernandez is now safely in Santiago Chile after The Startup Societies Foundation crowdfunded his travel out of Venezuela. It had to be funded with Bitcoin, as PayPal does not work in Venezuela. Bitcoin knows no borders.

The Venezuelan government has a bogus exchange rate, so in order to get the actual value of the Bitcoin when exchanging it for Venezuelan bolivars, Guillermo had to turn to the black market.

Before this, Guillermo had gone to the internet to make money since $1 a day wasn’t cutting it at his job in Venezuela. He was able to make $15 for a single task freelancing on the internet, and the only money he could accept was Bitcoin.

Still, he was only able to save about $20 a month, which meant having to spend possibly another year in Venezuela. And with government-aligned forces robbing and murdering in the streets, who knew when it would be too late to flee?

Thanks to Thibault Serlet, I soon began working at the Startup Societies Foundation, earning an additional income. After a few weeks, Thibault used the Startup Societies Foundation network to crowdfund Bitcoin donations for my ticket out of Venezuela.

Many generous, anonymous people helped me. I am forever grateful for their kindness.

I exchanged the bitcoin for enough bolivars to leave and then started my journey. I began an exodus through 5 countries, for a total of 6835 Km, from Venezuela to Chile.

Guillermo is a hard worker with marketable skills. Now safely out of a repressive country, he can reach his full potential, and not be hampered by destructive socialist policies.

The takeaway here is that Guillermo was able to remove himself from a terrible situation because of modern technology. He was able to make money online because of companies which connect people across oceans for freelance work. He was able to get paid because of crypto-currencies, regardless of the economic manipulation under the socialist regime.

Internet freelance, Bitcoin, Startup Societies Foundation and Guillermo’s defiance of the corrupt socialist powers controlling Venezuela made possible his escape from that socialist sinkhole.

First published here: http://j.mp/2qsQK9n

Source: stockcharts.com

The past few weeks, there has been a lot of fuss about the GDXJ ETF. An Exchange Traded fund issued by Van Eck which aims to track the index of junior gold mining companies. The ETF has always been extremely popular amongst investors as it provided an easy and low-cost access to gaining exposure to the junior gold space.

It didn’t take long before derivative-focused products took off as well, of which the Direxion-products offering a triple leverage on the GDXJ index ETF were very likely the most popular. When Direxion stopped issuing new units amidst a sky-high demand, several key people started to wondering whether or not the GDXJ became too popular.

With a net asset value of several billions, the ETF is definitely large, but it would be highly surprising if the current size (just $4B) would be such a disruptive factor in the mining industry, and the junior gold mining index. At least, that shouldn’t be the case, as the top-5 of GDXJ’s positions have a combined market capitalization of approximately $10B (this excludes the position in the GDX).

Whilst the GDXJ is absolutely popular for the right reasons, one might argue the GDXJ becomes too big compared to the size of the companies it’s investing in.

But perhaps this isn’t a problem at all. In fact, it’s a positive thing, as it means there very clearly is a huge interest from the investing community to gain exposure to junior gold mining companies. An ETF is obviously the easiest and fastest way to get exposure to several companies in ‘one basket’, rather than going through the process to buy the companies separately.

So, even if the GDXJ would close its doors for new investors (by for instance suspending the creation of new units), the money would still flow into the sector, and the issues wouldn’t be solved at all. Only the ‘convenience factor’ would go down. In fact, the best way to solve the current size of the GDXJ is simply to wait for a market correction.

After all, most of the ETF buyers are investors who want to get exposure, but lack the time or resources to really investigate every company and pick the best amongst them. So these will almost per definition also be the investors who’ll sell their GDXJ units during the next correction on the gold market. The majority of those who got into the GDXJ will get out again.

Will this result in a higher volatility on the markets? Sure. But there would be no difference compared to how the market would have reacted if those ETF buyers would have bought the underlying stock. So it essentially is a non-argument. Another non-argument would be to suggest other ETF’s to investors, such as the smaller Sprott Gold Miners Trust. Not only would this just be ‘transporting’ the problem (after all, whether the funds are invested in ETF A or ETF B, the market positions will continue to be bought or sold depending on de market circumstances).

Source: Van Eck

The very best way to deal with this issue is very likely rebalancing the index that’s being tracked by the ETF’s. When the new index will be implemented on June 17^th, the total amount of companies the GDXJ can invest in will increase from 48 to 69.

This increases the investment options for GDXJ, but will also have a very negative side effect, as the GDXJ will have to rebalance the portfolio pretty much overnight. It shouldn’t be an issue to liquidate the investment in GDX ($250M+) and use the existing cash resources, but some of the current holdings will have to try to accommodate Van Eck by arranging blocks to avoid their share prices being impacted too heavily.

Source: Toronto Dominion Bank

According to the two previous images from the Toronto Dominion Bank, some of the positions could take a few days to unwind, whilst some of the new positions will result in a tremendous buying pressure in the more illiquid names.

The solution is pretty simple; instead of ‘forcing’ GDXJ to start tracking the renewed index overnight, the Van Eck fund managers should allow themselves a week, or even several weeks to ensure an orderly update without risking to disrupt the market. And if that doesn’t happen: be prepared to take action right before and right after the rebalancing.

Our conclusion: The GDXJ isn’t ‘too big’. Its investment possibilities were ‘too limited’, and with rebalancing the portfolio in June, this issue will be solved.

>>> Click here to DOWNLOAD our Guide to Gold!

Secular Investor offers a fresh look at investing. We analyze long lasting cycles, coupled with a collection of strategic investments and concrete tips for different types of assets. The methods and strategies are transformed into the Gold & Silver Report and the Commodity Report.

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First published here: http://j.mp/2qszCAs

The media was gleefully cheering on the specter of Jones losing sole custody of his children. So he invited them to the front of the courthouse to discuss the facts about the trial, and then about 15 minutes in started to redpill them on things, like chimeras and other wondrous and nightmarish mutations.

This was his magnum opus.

Watch.

Content originally published at iBankCoin.com

First published here: http://j.mp/2qkxJXl

Regime change was all the rage under the Obama administration -- especially in the middle east. The pitch was MUH democracy needed to be exported to savage lands, whose populations were largely an illiterate ensemble of archaic tribes hellbent on blowing each other up over the interpretation of their fictional holy books.

Here was two time failed Presidential candidate, Hillary Clinton, flippantly opining about the fate of Libyan leader, Muammar Gaddafi.

Since then, Libya has been a staging ground for terrorist activities and an open hole in North Africa by which an endless stream of migrants use to enter Italy. All of the weapons stockpiled by Gaddafi were taken by 'rebels' who used them to take over large swaths of land in Syria and Iraq. Our embassy was run over, and our Ambassador killed. All of this because we wanted to 'free' the Libyan people from their misery -- which, ironically, resulted in a greater and deeper misery than they could've ever imagined.

So what has the liberal/neocon policy of regime change done for Libya lately?

Fucking slavery (please contain your outrage).

According to a report by the UN Migration Agency, Libyan rebels are capturing poor Africans, seeking to enter Europe, housing them in parking lots and make-shift prisons, in order to sell them on the open market like the days of antiquity, for as little as $100.

Source: CNBC
"We talk to returning migrants every day and we hear this stories every day — stories of exploitation, psychological, physical and sexual abuse," Giuseppe Loprete, Niger-based chief of mission of the UN International Organization for Migration, told CNBC recently.

For thousands of migrants paying to be smuggled out of North Africa, Libya remains the only route to Europe, and is a "black hole" where many disappear into exploitation, he said, adding: "The situation is only getting worse."

The going price for kidnapped migrants ranges from $200 to $500 in Libya, according to survivors who have returned to the IOM's transit center. In the last few months, the organization has arranged for the repatriation of 1,500 migrants back to their homes, which include Nigeria, Senegal and Gambia.

Libya is a gateway to Italy from Africa, with an estimated 25,000 migrants having crossed the Mediterranean Sea this year. Although Italy has taken measures to stem the flow of migrants from Libya, IOM data suggest crossings are on pace to challenge the nearly 182,000 migrants who landed in Italy last year.

"Migrants who go to Libya while trying to get to Europe, have no idea of the torture archipelago that awaits them just over the border," Leonard Doyle, chief IOM spokesman in Geneva, said in a recent statement. African migrants "become commodities to be bought, sold and discarded when they have no more value," he added.

Former National Security Council officer under Obama, Eric Pelofsky laments, "It is a terrible situation thriving in the shadows created by the larger conflict in Libya."

Leonard Doyle, Spokesperson of the Director General at the International Organization for Migration (IOM), sums it up: "Migrants who go to Libya while trying to get to Europe, have no idea of the torture archipelago that awaits them just over the border." He grimly adds, African migrants "become commodities to be bought, sold and discarded when they have no more value."

First published here: http://j.mp/2qrCMo0