Silver Bullion Trust, an all silver fund from the CEF/GTU closed-end fund group, has its roadshow going on now.

Initially it will only be available in Canada. It will trade on the TSX to start, then on the AMEX once it has risen to $75 million of assets which is a similar process used in the introduction of GTU.

It will trade in Canada in both U.S. and Canadian dollars.

The initial offering is reported to be for up to $200 million, so the $75 million threshold could be met immediately depending on the bid size of the deal.

It is expected to price at around US $10 (1 share + 1 $10 warrant) by July 29th.

This could be a interesting alternative to SLV and to CEF for those who wish to invest more heavily in silver.

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Bank of America’s Q2 Income Falls 5.5 Percent To $3.22 billion (BAC)
“Having positive net income in an extremely challenging environment speaks to the diversity and strength of our business model as well as the extraordinary effort put forth by all of our associates,” said Ken Lewis. “Our goals during this difficult time have been to enhance the strength of our balance sheet and capital position and to continue to improve our earning power while dealing with the credit issues facing our industry due to the recession.”

Citigroup Reports Second Quarter Net Income of $4.3 Billion (C)
“For many quarters we have been consistently and successfully executing our plan to build financial strength and return Citi to sustained profitability and growth. We have made significant progress in recent quarters as evidenced in the significant decline in expenses, headcount, assets, including Citi’s riskiest assets, as well as our 12.7% Tier 1 capital ratio,” said Vikram Pandit.

Two Giants Emerge From The Wall Street Ruins (NYT)
And they are: Citi and BofA. No, come on. “One theme here is that Goldman Sachs and JPMorgan really have emerged as the winners, as the last of the survivors,” said Robert Reich.

AIG Bank Swaps May Take Years to Expire, Leaving A ‘Toxic Pool’ (Bloomberg)
Last month, AIG said in a regulatory filing that it may be at risk for losses for “significantly longer than anticipated” if the banks don’t terminate their swaps. Ballpark: an eternity.

New Fund-Raising Reality for New Jersey Governor (NYT)
Not all Goldman alums are doing as well as Maxine would like to think: JSC needs your cash, asap.

Geithner Sees Evidence of a Financial Recovery (NYT)
Still hasn’t been able to sell his house, but the Treasury Secretary feels pretty good about the way things are going.

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Courtesy of Karl Denninger at The Market Ticker

Big Kudos Karl. CNBC including Dennis “the seal” Kneale have completely lost their collective minds. Denny loves going after the bloggers now because we bloggers are gaining more and more credibility. FOX Business is now on my TV.

Courtesy of Bess Levin Deal Breaker

First year Bank of Amerillwide employees have apparently received $38k bonuses for S&T and $30k stubs for research. The budding Kens also all had their base pay raised to $80k from $60k. For those keeping track at home, second rate first year staff at Citi are still killing this thing, thanks to the generosity of Tim Geither, and certain well-heeled Prince. Ken Lewis is said to be telling lieutenants he’s planning on buying everyone a round tonight but do note that he said “planning” as in there’ll most likely be a skipping out on the tab situation.

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ARCA biopharma is seeing some major volume for this company. The float is small so this could continue to help rocket the stock higher on heavy volume. Could it be positive news on FDA Approval? Very possible.

Market Club has a very interesting take on how ABIO is playing out after the past volume surge. The “Trade Triangles” paint the picture. CLICK HERE and just enter the ticker (ABIO) your name and e-mail address for the FREE No strings Attached Report sent realtime to your in-box!

Make sure you use the “Trade Triangles for 30 days FREE” to help you get in and out of the trade.

Hat tip The Market Guardian

By Gary Grimes

The following article is adapted from market analysis by Elliott Wave International Chief Commodity Analyst Jeffrey Kennedy. Now through July 22, Jeffrey Kennedy’s daily, intermediate, and long-term forecasts for up to 18 markets are free via EWI’s FreeWeek. Learn more here.

Wave patterns are like beautiful women, classic cars and great art – you know them when you see them.

EWI analyst Jeffrey Kennedy drives this point home during his live Elliott wave trading tutorial. It’s my favorite of his tips for trading with Elliott waves.
“Trade the pattern not the count,” Jeffrey says.

If you don’t recognize a pattern at a glance, don’t trade it – plain and simple. After all, your wave count can be wrong; the pattern cannot.

Does that mean you must know the exact wave count at a glance, as well? No. Simply spotting a pattern you recognize is where you should start.

Jeffrey scans hundreds of charts, clicking through them one by one, spending mere seconds with each. If he doesn’t spot a pattern he recognizes, a click of his mouse takes him to another potential opportunity.

Does price action look extended or choppy? Is it trading in a channel? Is it forming a wedge or triangle shape? These are some of the signals Jeffrey’s looking for. Each could help him identify – at the quickest of glances – whether price action is impulsive or corrective. This is the first critical step, Jeffrey says, to spotting high-confidence, Elliott wave trade setups.

That brings us to the following chart. Do you see a pattern you recognize? I do.

Look at the downward price action; the moves look decisive, almost in straight lines like impulse waves. Now look at the upward moves; they look indecisive and choppy like corrections. There’s also one down move that is clearly longer than the others – that’s almost certainly a third wave of some degree.

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At just a glance, here are a few things we can determine:

• This is a bearish market pattern, because downward impulses are interrupted by upward corrections.
• The price action from September to November seems to be a pretty clear wave 3 down, followed by waves 4 up then 5 down, completing what appears to be a larger degree wave 1 in early March.
• Wave 2 follows wave 1, so the upward move starting in early March is most likely a larger degree wave 2.
• Wave 3 follows wave 2, so that’s what we can expect next.
• Wave 3 is never the shortest and often the longest of all five waves, so we can expect the next impulse move to take prices to new lows.

You see, with just a quick glance, we’ve put a finger on the pulse of the market. Negative psychology pulls prices down, and brief reversals of mood result in upward corrections – this appears to be a long-term bear market.

If you can gain this much insight simply by glancing at a chart, just think of what else you can glean by spending more time with it. Look at this pattern within a longer time frame, and you can determine the degree of trend (this one appears to be primary). Formulate Fibonacci price and time targets, and you can be confident about when and where prices will most likely turn.
There are literally hundreds of things you can do with a good chart, but none of them mean much unless you can first identify a pattern you recognize.

———

For more information on using patterns to spot trading opportunities, access Elliott Wave International’s FreeWeek. Now through July 22, all of EWI Chief Commodity Analyst Jeffrey Kennedy’s daily, intermediate, and long-term market forecasts are completely free. Learn more here.

China’s banks have gone on a lending spree in 2009, spurred by a combination of loose monetary policy and a tacit assumption that the central and local governments will cover any losses.

Economists were caught off guard by June’s lending figures, which surged to US$223.94 billion. It was thought the peak had been reached in March, when lending reaching US$276.6 billion, with May’s relatively modest US$97.25 billion an indication that the government was scaling back its efforts.

In total, China’s banks have extended US$1.08 trillion worth of new loans in the first half, far outstripping the US$717.17 billion issued in all of last year.

In the short term, analysts say that these virtually unprecedented lending levels do not threaten the stability of China’s banking sector. The medium-term outlook though is murky. While some fear that a wave of non-performing loans (NPL) could begin surface at the tail end of 2010, others expect continued economic growth and vigilant regulators to keep the sector on an even keel.

(…)

Royal Bank of Scotland estimates that about half of the loans made this year have gone to infrastructure projects, and analysts generally believe lending growth will slow in the second half of the year, as the lion’s share of these infrastructure loans have already been allocated.

However, there are indications that significant amounts of the funds are bypassing the real economy. In addition to anecdotal evidence cited by market watchers, Wei Jianing, an economist at a cabinet-level think tank, in late June estimated that 20% of the credit issued in the first five months of the year was channeled into equity markets, and that an additional 30% flowed into real estate investments. Wei, who stressed that these findings reflected his personal opinion and not those of the State Council, said this influx of funds could lead to dangerous asset bubbles and rising real estate prices.

As the People’s Bank of China (PBoC) released the June lending figures, it also took short-term steps drain liquidity from the market. On July 8 it issued US$7.3 billion in three-month bills and, notably, an equal amount in one-year paper, the first such issue since November 18. The central bank also withdrew US$1.46 billion from the interbank market, the first time it had done so in three weeks.

J.P. Morgan economist Wang Qian said in a recent report that the action doesn’t amount to a significant shift in monetary policy, but rather a fine-tuning of the current policy. While one can never rule out the possibility of tightening of monetary policy, Beijing remains dubious that the economic recovery has found solid ground and thus will maintain the current “moderately loose” monetary policy through 2009.

(…)

Standard Chartered economist Stephen Green echoed these sentiments on monetary policy in a recent research note, adding that he expects banks’ reserve requirement ratios – money they must keep in reserve and thus not lend out – to remain stable at 15% this year, though he did not rule out any cuts next year.

While China’s lending spree has raised fears of fresh NPLs in the pipeline, some believe there may be more smoke than fire.
(…)

But Leo Wah, a vice president and senior analyst with Moody’s in Hong Kong said that much of the NPL writeoffs at China’s banks over the past years have arisen from a recovery of legacy NPLs and as such don’t take into account the potential risks arising from new lending.

“When banks are increasing loan growth aggressively it is difficult to believe that credit quality controls are completely the same as what they had been before,” he said. Nonetheless, he believes that China’s banking sector will remain strong in 2009, though he doesn’t expect a return to the triple-digit or even high double-digit profit growth seen in previous years. Source: China Economic Review

Crude oil was lower overnight as it consolidates some of Wednesday’s rally. However, stochastics and the RSI are oversold and are turning neutral to bullish hinting that a short term low might be in or is near.

Closes above the 20 day moving average crossing at 65.35 are needed to confirm that a short term low has been posted. If August extends the decline off June’s high, the 62% retracement level of the February-June rally crossing at 54.97 is the next downside target.

First resistance is the 10 day moving average crossing at 61.47
Second resistance is the 20 day moving average crossing at 65.35

First support is Monday’s low crossing at 58.32
Second support is the 62% retracement level crossing at 54.97

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U.S. Regulators to BofA: Obey or Else (WSJ)
Under threat of management being fired, Bank of America has been ordered to do exactly as the government says. This time not by Hank Paulson! BAC was told in April it must, among other things, “overhaul its board and address perceived problems with risk and liquidity management,” with deadlines for getting it all done fast approaching, or Ken Lewis is out of a job.

Harvard Law Tells Students: Don’t Panic Over Jobs (Bloomberg)
“If you are looking in D.C., consider Baltimore or Richmond…If you’re looking in Chicago, try Milwaukee and St. Louis, too…if you’re looking in New York, try Long Island…if you’re looking in LA try East Compton.”

Obama Bill Seeks To Shine Light On Hedge Funds (NYT)
The plan aims to “counteract any incentive for the largest firms gambling with their size,” Michael Barr, U.S. Treasury assistant secretary for financial institutions said.

Plan to unveil City high-flyers’ pay (FT)
“The pay and bonuses of hundreds of high-flying City traders and dealmakers will have to be publicly disclosed under a Treasury-backed plan to curb excessive and risky remuneration.”

Getting Trumped (NYP)
Pretty upsetting news: Donald Trump’s attempt to get a judge to take his libel case wherein Hairpiece accused an author who said his net worth was between $150 million and $250 million and not the $5 billion to $6 billion Trump claims was thrown out in court.

Citi Close To Secret Deal With Regulator (FT)
The proposed agreement requires, among other things, that Citi be Citi, but just a better, less fuck-up-y Citi. Ways it could do this: strengthen board and governance, improve asset quality, better manage expenses and provide more information to regulators on its capital and liquidity. Not really sure why this has to be done in “secret,” but SheBair and Vikram are known to love speaking in code and pretending they’re starring in a Russian spy movie so, whatevs.