‘PANIC IS EVERYWHERE’: Gold Market Crashes, Chinese Growth Slows, ECB Put Pressure On Insolvent European Country To Sell Gold To Fund The Bailout, Wells Fargo, JPMorgan, Citi Results Suggest Housing Market Slowing And Consumer Is Still Deleveraging. Will Investors Start Dumping Stocks?


A Complete Look At China’s Latest Disappointing Data In One Chart

China just released its latest batch of economic data which showed that economic growth missed analyst expectations.

First here’s a look at the latest data from China, including trade and inflation data that were released last week:

 

March Chinese data

Business Insider

Gartman on Gold: We’ve Never Seen Anything Like It

Gold prices continued to plummet Monday on concern that Cyprus will have to sell excess reserves of the precious metal to raise about $522 million to help finance that country’s $13 billion international bailout, Dennis Gartman, editor of The Gartman Letter, told CNBC.

“There are a lot of people throwing up their hands. Throwing positions overboard. Panic is everywhere,” Gartman said in a “Squawk Box” interview on Monday. “I’ve never seen anything like this. I mean it.”

Gold prices broke below $1,400 on Monday, as investors dumped shares of gold miners on worries over their profitability as the yellow metal hit its lowest level since March 2011.

“We’ve traded gold for nearly four decades and we’ve never… ever… ever… seen anything like what we’ve witnessed in the past two trading sessions,” Dennis Gartman, the editor of The Gartman Letter said in a note on Monday.

We fear that when N.Y. opens hours from now, and when the public sees the damage done to their accounts, there will be one more violent sum of selling that hopefully shall clear the decks. However, we cannot be certain that that is true and the ‘true believers’ in gold are clearly under duress.”

 

Gold extended its decline on Monday, falling below $1,400 an ounce and investors dumped shares of gold miners on worries over their profitability.

ECB President Mario Draghi Put Pressure On Insolvent European Country To Sell Gold To Fund The Bailout

 

Shamu said gold’s tumble has largely been blamed on potential central-bank sales to shore up fiscal shortfalls. “This is after ECB President Mario Draghi put pressure on Cyprus to sell its excess gold reserves to help fund the bailout and plug a €6 billion gap. Although Cyprus is yet to decide how it’ll fund the gap, these comments have rattled investors and caused the selloff.”

He said this has also triggered a “breakdown of the gold/quantitative easing relationship we’d gotten used to, where poor U.S. economic readings lead to prolonged QE expectations and in turn a weaker U.S. dollar and stronger gold price. This drop officially puts gold in a bear market.”

 

China economic data disappoint, slamming stocks

Chinese economic data released Monday, including first-quarter growth, came in weaker than expected, sending stocks lower across Asia, even as some analysts predicted a better numbers ahead.

Gross domestic product for the January-March quarter rose 7.7% from a year earlier, the National Bureau of Statistics said, weakening from 7.9% growth in the fourth quarter, and missing projections for 8% growth in separate surveys from Dow Jones Newswires and Reuters.

Among the March data, industrial production increased 8.9% from the year-earlier period, well below the Dow Jones Newswires forecast for a 10% gain.

 

Wells Fargo, JPMorgan Results Suggest Housing Market Slowing

First-quarter financial results reported by Wells Fargo and JPMorgan on Friday indicate the housing market may be slowing.

JPMorgan reported a 4 percent drop in total revenue from the first quarter of last year, while Wells Fargo reported a 1.7 percent drop.

A drop in mortgage lending was a major factor, the Journal reports. JPMorgan said its mortgage profits fell 31 percent; Wells Fargo said its mortgage-banking income was down 2.7 percent.

The downturn in refinancings is a sign of worsening health for the financial sector and the general economy, the Journal says. The article quoted bank analyst Todd Hagerman of Sterne Agee & Leach as saying the numbers “underscore expectations for a slowing economy over perhaps the next couple of quarters.”

Citi Earnings Beat Expectations, But The Consumer Is Still Deleveraging

Banking conglomerate Citigroup just released its Q1 financial results.

It earned $1.23 per share on an adjusted basis.  This is higher than the $1.17 expected by analysts.

Revenue came in at $20.8 billion, which was a tad higher than the $20.1 billion expected.

“During the quarter, we benefitted from seasonally strong results in our markets businesses, sustained momentum in investment banking, continued year-over-year growth in loans and deposits in Citicorp, and a more favorable credit environment,” said Citi CEO Michael Corbat.  “However, the environment remains challenging and we are sure to be tested as we go through the year. ”

Just-Out: Empire Fed Manufacturing Falls More Than Expected

 

Which Country’s Gold Will Be Sold Next?

he first time the Status Quo/Troika tried to force a (not so) stealthy gold confiscation on an insolvent European country was back in early 2012, when as part of the most recent Greek bailout MOU, it was disclosed that “Greece’s lenders will have the right to seize the gold reserves in the Bank of Greece under the terms of the new deal.” However, the public outcry was so loud that the Troika had no choice but to shelve its plans and proceed with a full scale bondholder restructuring instead. Fast forward to last week, when Europe’s appetite for physical gold came back with a bang, this time as part of the Cyprus “Debt Sustainability Analysis“, and subsequent comments from Mario Draghi, demanding that tiny Cyprus, whose opposition, already weakened by the confiscation of uninsured deposits would be far less vocal than Greece’s, sell off €400MM, or virtually all of its sovereign gold, over 10 of its 13.9 total tons, to cover the excess costs of its ever ballooning sovereign bailout.

So who’s next? It remains to be seen, although we are certain there will be a very clear correlation between the next country to see its gold “purchased” by the status quo, likely some time in the next 1-3 months, and the amount of total non-performing loans on said country’s bank balance sheets. The usual suspects are presented below.

And, in the parlance of Goldman Sachs, these countries better scramble to sell, sell, sell now before gold hits 0, or maybe even goes negative.

 

Billionaires Dumping Stocks, Economist Knows Why

Despite the 6.5% stock market rally over the last three months, a handful of billionaires are quietly dumping their American stocks . . . and fast.

Warren Buffett, who has been a cheerleader for U.S. stocks for quite some time, is dumping shares at an alarming rate. He recently complained of “disappointing performance” in dyed-in-the-wool American companies like Johnson & Johnson, Procter & Gamble, and Kraft Foods.

In the latest filing for Buffett’s holding company Berkshire Hathaway, Buffett has been drastically reducing his exposure to stocks that depend on consumer purchasing habits. Berkshire sold roughly 19 million shares of Johnson & Johnson, and reduced his overall stake in “consumer product stocks” by 21%. Berkshire Hathaway also sold its entire stake in California-based computer parts supplier Intel.

With 70% of the U.S. economy dependent on consumer spending, Buffett’s apparent lack of faith in these companies’ future prospects is worrisome.

Unfortunately Buffett isn’t alone.

Fellow billionaire John Paulson, who made a fortune betting on the subprime mortgage meltdown, is clearing out of U.S. stocks too. During the second quarter of the year, Paulson’s hedge fund, Paulson & Co., dumped 14 million shares of JPMorgan Chase. The fund also dumped its entire position in discount retailer Family Dollar and consumer-goods maker Sara Lee….

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