Gold World News Flash |
- Gold Community Will Not Make The Most Profit On Gold?s Rise
- Selling Into Strength
- GoldSeek.com Radio Gold Nugget: James Turk, & Chris Waltzek
- Subversive Government Economists
- Will Investors Find Envestnet IPO Compelling?
- Price Stability Not a Fed Priority
- Looking for a Turn in Gold from $1140
- SP 500 September Futures; Gold Daily; Gold Weekly
- To Rickards, a bureaucratized, debt-ridden modern empire looks worse than declining Rome
- SP-500, GLD and GDX – Sentiment Trumps Everything
- It's A Great Time To Be A New College Graduate: High Unemployment, Crappy Service Jobs And Crippling Student Loan Debt
- Gold At Long Term Trend Support, Key Level Highlighted
- Nevada's Economic Misery May Be America's Future
- More on Aussie Dominators
- Crude Oil Falters Under $80, Gold Breaks Down to New Lows
- Gold Seeker Closing Report: Gold and Silver Fall Over 2% and 3%
- Tuesday ETF Roundup: GDX Tumbles, UNG Marches Higher
- Jay Taylor interviews Swiss America's Fred Goldstein on investing in real metal
- Jay Taylor interviews Swiss America's Fred Goldstein on investing in real metal
- Stewart Thompson: Central banks will push gold up to rescue asset prices
- bcIMC Up 16.3% in 2009-2010
- Hinde Capital's Ben Davies talks gold price suppression on CNBC
- Hinde Capital's Ben Davies talks gold price suppression on CNBC
- Jul 27- Trading The Waterfall Declines for Profits
- What a Run on Gold Bullion Banks Could Look Like
- Gold Prices Fall to 3-Month Low, Silver Plummets 3.2%
- Technical Weakness Continues for Gold and Metals Miners
- What’s With the Gold ‘Strength Index’?
- Gold Is Struggling
- Capital Gold Group Report: University of Texas’ Money Manager Shifts $500 Million into Gold
- Capital Gold Group Report: 103 Failed Banks to Date in 2010; Problem Bank list hits 775
- Update 8:45PM EST
- Underlying Bid In Equities Evident, Yet Buyer Remains Untested By Volume
- Why do U.S. Asset Managers fear Government Confiscation of Gold? Part 1
- Hoping For A Break
- Stock Picks From the Vancouver Conference
- America, the Odd Man Out
- How much do you put in PMs vs. FRNs in case you need cash?
- Countdown to Gold's $1300 Assault
- Honest Money Gold and Silver Report: Market Wrap Week Ending 7/23/10
- Spending Cuts in the Age of De-Leveraging
- Gold — a hedge against uncertainty
- Of Course Clean Up Workers Can't Find the Oil ... BP Used Dispersants to Temporarily Hide It, So Now It Will Plague the Gulf For Years
- Gold Community Will Not Make The Most Profit On Gold's Rise
- This Nasty ETF Indicator Is Flashing Again
- LGMR: Gold & Dollar Slip, Silver Gains with Stocks & Commodities
- ECB President John-Claude Trichet Challenges Inflationism
- S&P Priced In Gold: Comparison Between The Great Depression And Now
- TUESDAY Market Excerpts
- This China growth story has nothing to do with gold, energy, or commodities
| Gold Community Will Not Make The Most Profit On Gold?s Rise Posted: 27 Jul 2010 07:22 PM PDT View the original post at jsmineset.com... July 27, 2010 02:27 PM My Dear Friends, I have said to you many times that the entities that will make the most profit on the gold price will not be the gold community, but rather just those that the community identifies as the enemy, the gold banks. What is happening now is the setup to that event. Recently Armstrong questioned publicly if the Goldmans of the world were using his cyclical analysis. Judging from what we have seen the answer is yes by intention or coincidence. Those wishing to offset their pain on me today have to be defined as the public. The only bulls today are the stone professionals who can see what is taking place in the published numbers. The gold banks are engineering their short cover and will shift to the long side of gold. It is in fact happening right now as the public panics. The currency market and media will be called into service in order to take gold to and through $1650. Respectfully, Jim...
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| Posted: 27 Jul 2010 07:09 PM PDT The market is overbought and it’s time to protect our winnings from the past week or so, they are extensive. I peeled back some exposure on the long side from names that had run too far too fast (a great problem to have). They include Titanium Metals Corp. (TIE), OmniVision Technologies (OVTI), Finisar Corp. (FNSR) SkyWorks Solutions (SWKS) and Power-One (PWER). I will be looking to add back to these positions in a few days after the market and the individual names work off their overbought readings and give better secondary entry points. I’m letting positions in Cummins (CMI), Westport Innovations (WPRT) and Dolby Labs (DLB) run, they were all showing good strength yesterday and aren’t yet overbought. They can withstand a broader market consolidation and move higher in my opinion. Cummins reported great earnings Monday night, I will be adding to the position again most likely in a few days. Complete Story »
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| GoldSeek.com Radio Gold Nugget: James Turk, & Chris Waltzek Posted: 27 Jul 2010 07:02 PM PDT GoldSeek.com Radio Gold Nugget: James Turk, & Chris Waltzek
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| Subversive Government Economists Posted: 27 Jul 2010 06:25 PM PDT Annaly Salvos submits: The economic research staff at the Federal Reserve Bank of New York has been busy. Last week we wrote about the New York Fed’s Staff Report No. 458, which discussed the shadow banking system in the United States. Today we refer to two other new reports: Staff Report No. 457, entitled “Resolving Troubled Systemically Important Cross-Border Financial Institutions: Is a New Corporate Organizational Form Required?”, and Staff Report No. 463, “The Central-Bank Balance Sheet as an Instrument of Monetary Policy.” After reviewing them, we are left to conclude that these three papers demonstrate that the research staff at the New York Fed is perhaps the most subversive group of working economists currently on the government payroll. No. 457 examines the challenges of “large, complex, internationally active financial institutions,” primarily from a corporate governance perspective. The paper begins with a review of a commonly heard complaint that arose in the aftermath of the financial crisis of 2008. “Virtually all the principals in the U.S. involved in developing policies to deal with troubled financial institutions during the current final [sic] crisis have argued that they were handicapped in the options available to deal with large systemically important non-bank institutions like Bear Stearns, Lehman Brothers and AIG. They indicate that they were faced with relying upon 1) hastily arranged mergers, 2) traditional bankruptcy laws to resolve institutions, or 3) government injections of funds to enable troubled institutions simply to continue operating.” The authors, Christine Cumming and Robert A. Eisenbeis, contrast these very challenging resolutions with the relatively simpler resolutions of troubled depository institutions like Countrywide and IndyMac. The authors go on to propose a new, simpler financial charter for these kinds of organizations. The following table (click to enlarge) from the paper demonstrates the enormous complexity of the modern-day financial institution. Complete Story »
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| Will Investors Find Envestnet IPO Compelling? Posted: 27 Jul 2010 06:15 PM PDT Renaissance Capital IPO Research submits: Envestnet (ENV) provides technology-enabled investment solutions and services to 19,376 US financial advisors representing $107 billion in assets. Its offerings run the gamut from back-office and reporting services to financial planning tools and account management. Envestnet is benefiting from the shift toward independent advisors, who lack the scale to perform these functions in-house and use Envestnet as a cost-effective alternative. The company, which was founded by executives from Nuveen Investments and is backed by venture firms GRP Partners and Foundation Capital, is looking to go public in a $100 million IPO; Morgan Stanley (MS), UBS (UBS) and Barclays (BCS) are the bookrunners on the deal, which is on this week's IPO calendar. Business model Complete Story »
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| Price Stability Not a Fed Priority Posted: 27 Jul 2010 06:02 PM PDT I knew the instant that I read the article's title, "Fed Nominees Seek Economic Boost" in The Wall Street Journal, that I was probably going to be outraged and end up screaming a fearful and angry Mogambo Howl Of Anger (MHOA).
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| Looking for a Turn in Gold from $1140 Posted: 27 Jul 2010 06:00 PM PDT Has Gold's price action been getting you down lately? Take heart, since relief could come as early as today or tomorrow in the form of a Hidden Pivot support at exactly $1140.10. For the last two weeks, that's been our downside target for the correction begun five weeks ago from around $1266, although it didn't begin to emerge with clarity until the August Comex contract plunged from $1208 right after the July 4th holiday weekend.
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| SP 500 September Futures; Gold Daily; Gold Weekly Posted: 27 Jul 2010 05:26 PM PDT |
| To Rickards, a bureaucratized, debt-ridden modern empire looks worse than declining Rome Posted: 27 Jul 2010 05:23 PM PDT 1:15a ET Wednesday, July 28, 2010 Dear Friend of GATA and Gold: In the second part of his most recent interview with Eric King of King World News, market analyst and trend spotter Jim Rickards of Omnis Inc. elaborates on the parallels between the United States and the decline of the Roman empire. Things are worse now, Rickards argues, because the United States, unlike the ancient empire, has a huge national debt. What's needed, Rickards says, is a great simplification -- low taxation, sound money, and a strengthening of moral and religious values -- but instead the country is bureaucratizing everything. If this isn't enough to make you want to end it all or take the next flight to Port-au-Prince, you can find the second part of Rickards' interview with King at the King World News Internet site here: http://www.kingworldnews.com/kingworldnews/Broadcast/Entries/2010/7/28_J... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Sona Resources Expects Positive Cash Flow from Blackdome, On May 18, 2010, Sona Resources Corp. (TSXV: SYS, Frankfurt: QS7) announced the release of a preliminary economic assessment for gold production at its flagship Blackdome and Elizabeth properties in British Columbia. Sona Executive Chairman Nick Ferris says: "We view this as a baseline scenario for gold production. The project is highly sensitive to the price of gold. A conservative valuation of gold at $1,093 per ounce would result in a pre-tax cash flow of $54 million. The assessment indicates that underground mining at the two sites would recover 183,600 ounces of gold and 62,500 ounces of silver. Permitting and infrastructure are already in place for processing ore at the Blackdome mill, with a 200-tonne per day throughput over an eight-year mine life. Our near-term goal is to continue aggressive exploration at Elizabeth and develop a million-plus-ounce gold resource, commencing production in 2013." For complete information on Sona Resources Corp. please visit: www.SonaResources.com A Canadian gold opportunity ready for growth Join GATA here: New Orleans Investment Conference * * * Support GATA by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: * * * Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Prophecy to Become Coal Producer This Year Prophecy Resource Corp. (TSX.V: PCY) announced on May 11 that it has entered into a mine services agreement with Leighton Asia Ltd. to begin coal production this year. Production will begin with a 250,000-tonne starter pit as planned in August, with production advancing to 2 million tonnes per year in 2011. Prophecy is fully funded to production and its management team includes John Morganti, Arnold Armstrong, and Rob McEwen. For Prophecy's complete press release about its production plans, please visit: http://www.prophecyresource.com/news_2010_may11.php
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| SP-500, GLD and GDX – Sentiment Trumps Everything Posted: 27 Jul 2010 05:11 PM PDT Markets rise when the preponderance of participants are buyers, and fall when the preponderance of participants are sellers. One of the key ways to anticipate the pendulum swings of participant behavior, and therefore price behavior, is to evaluate sentiment. Sentiment, more than fundamentals or technical analysis, trumps everything. When too many players are on the same side of a trade they eventually find themselves in a crowded position where most everyone around them has the same motivation – to reverse their position when the tide changes. Little by little, as participants slip out the back door by changing the bias of their position, the pendulum of price swings more sharply against the remaining herd in the crowded trade. Inevitably, something akin to panic sets into the herd as they begin to aggressively reverse their position for financial survival. The primary ingredient that causes price to catapult, up or down, is sentiment oscillation and capitalization from one sentiment extreme to the other. An astute market technician, investor or trader will look for those flash points where conditions are ripe for a market reversal. It sounds easy to do, but remember that when the analysis is very convincing, the preponderance of market participants will disagree. It seems that to be effective at market timing one needs to listen not to what others are saying, but to what the sentiment data represents as truth. With these thoughts as a foreword, let's see what the current sentiment situation is for the SP-500. The following chart is from Market-Harmonics and assimilates 4 years of bull/bear percentage data from Investor's Intelligence. To this chart I have measured and notated in blue the percent change in bearish advisors per the Investor's Intelligence data, for each downswing of the SP-500. My notation in green is the percentage change in bearish advisors for the related upswing of the SP-500. The price of the SP-500 is notated in black at each swing peak and trough. One of the most striking observations I have made of this data is that it appears the maximum pendulum swing in the bearish direction is a 20% change. This occurred in Q1, 2008. More frequently this percentage change has topped out at 19%, followed by 16%, 11% and smaller percentage changes. The obvious conclusion I come to is that our current bearish % change situation, at a 19% reading, is about at the maximum. History seems to show that investor's emotions, like a physical rubber band, can only be stretched so far into pessimism (19-20%) – the bearish direction – before they snap back in the opposite bullish direction. The pendulum swing in the bullish direction is about to begin at this very time.
I would expect that the stock market could not possibly peak until the % of bears decrease by a minimum of 8%, and more statistically likely 10-15%. With a current reading of 36%, I am suggesting that we should not even consider a peak in the stock market until the bear percentage reading drops from where it is now at 36% to 28%, and more likely to around 26-21%. What this means for now is that 1100 is not the top in the SP-500. Far from it. The bears have not even begun to turn into bulls. Price will go much higher from here and it will take weeks, if not a couple of months, minimum, to reach a shift where the % of bears are themselves finally out of whack on the teeter-totter. Gold, while not covered by Investor's Intelligence to my knowledge, would appear to be in a similar setup as the stock market. For this I turn to data published this past week at Schaeffer's Investment Research and look at the 2 year history of the GLD put/call option ratio. When the put/call ratio spikes high, it means that traders/investors are convinced that the price of gold will fall. I have circled on the chart such instances from the past two years in red. What we can observe is that when the bearish trade gets excessively crowded, when a preponderance of participants are convinced that gold will fall, that is not the top in gold. Rather, it is the bottom. I have circled with green the price of gold for each occasion of a put/call ratio spike. Again, think about what is going on here. When the put/call ratio spikes upward you have an intense perception and emotionally dramatic conviction of traders that substantially puts too many folks on the same side of the trade. When gold starts to move against them, even just a little out of their expectation range, each owner of a put option is no longer a seller of gold, but becomes a motivated buyer of gold! This is precisely how huge brisk run ups in price are both setup and then executed.
If I were presently short gold and looked at this chart it would send shivers down my spine. No kidding. Nothing like finding out you are in a crowded trade that once it starts to go bad, you KNOW it will go very bad. Now, I am not saying that the bottom for gold is in just yet. Gold could still delight the bears and frustrate the bulls with one last brief maneuver lower this week. But after that, if it happens, I believe gold's low will most definitely be in and then there will be a lot of folks who will wish they did not hold puts on gold. While gold has not yet told us if the last shoe has dropped, the GDX miner ETF, however, is suggesting a favorable outcome. The following daily chart is the GDX and below its price movement is the True Strength Index Indicator (TSI) with volume. You can make you own chart and use the TSI indicator by visiting Free Stock Charts. On the negative side for GDX, the True Strength Index indicator reading is still barely below ZERO in negative territory (-0.06). On the positive side, GDX is sporting a positive divergence between price and the indicator, a recapture of the uptrend line begun last February, a breakout of a 4 week price downtrend line and a breakout of the TSI indicator on increasing positive volume. All in all, I regard this setup as bullish for GDX and most likely for GLD, as well.
If you are interested in reading more about the techniques of using the True Strength Index (TSI) indicator, want to be exposed to discussion and analysis of various mining stocks, as well as the US Dollar and stock markets, or just want to participate in a blog where your thoughts are heard and responded to, I invite you to join me at my website which is: The TSI Trader. Or jot me an email, tsiTrader@gmail.com I wish you a profitable week! John Townsend
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| Posted: 27 Jul 2010 04:53 PM PDT 
We were always told that a college degree was supposed to prepare us for life in the real world. But today, the vast majority of college graduates end up moving back in with their parents. In fact, a recent survey of last year's college graduates found that 80 percent moved right back home with their parents after graduation. That was up substantially from 63 percent in 2006. So why are 80 percent of our college graduates moving back in with their parents? Well, because they can't get jobs. Two million recent college graduates are unemployed, and millions of others are working in fast food joints, at big box stores and in other very low paying service positions. The stories that some recent college grads tell are so bizarre that they border on the unbelievable. The Huffington Post recently featured the story of Kyle Daley - a highly qualified UCLA graduate who has been unemployed for 19 months.... I spent my time at UCLA preparing for the outside world. I had internships in congressional offices, political action committees, non-profits and even as a personal intern to a successful venture capitalist. These weren't the run-of-the-mill office internships; I worked in marketing, press relations, research and analysis. Additionally, the mayor and city council of my hometown appointed me to serve on two citywide governing bodies, the planning commission and the open government commission. I used to think that given my experience, finding work after graduation would be easy. At this point, however, looking for a job is my job. I recently counted the number of job applications I have sent out over the past year -- it amounts to several hundred. I have tried to find part-time work at local stores or restaurants, only to be turned away. Apparently, having a college degree implies that I might bail out quickly when a better opportunity comes along. The sad thing is that so many of these recent college graduates can't even get hired for retail jobs. A reader of my column on The American Dream blog named Kate is a recent college graduate who is experiencing the kind of extreme frustration that so many new graduates are going through right now.... I just graduated college in May… Moved to a new state and am now living with my boyfriend who should not and cannot continue to have to pay everything because i just plain can't get a job. I'm over qualified for retail survivor jobs… so I lie on my application. But then retail stores just plain don't hire full time. So even if I could get a job as a cashier someplace… I'd only work enough hours to maybe pay for my car payment/ car insurance/ gas…. and my half of rent/electric and such is out of the question… not to mention charged to the limit credit cards from being unemployed and student loans that will hit in just a matter of months. Any other jobs either don't exist or they just ALL want 5 years professional experience…. which is impossible for someone who just graduated and has been working part time retail jobs since high school. But it just isn't college graduates that are suffering. The truth is that this economic downturn has been hurting everyone.... *According to a recent Pew Research poll, approximately 37% of all Americans between the ages of 18 and 29 have either been unemployed or underemployed at some point during the recession. *A different Pew Research survey found that 55 percent of American workers have experienced either unemployment, a pay decrease, a reduction in hours or an involuntary move to part-time work since the recession began. *According to another survey, 28% of all U.S. households have at least one member that is currently looking for a full-time job. For many U.S. households, the person looking for a job is a recent college graduate. As you read this, hordes of highly qualified college grads are out applying for jobs as waitresses, pizza delivery men, grocery checkout clerks and hamburger flippers. Even those who are able to get decent jobs are finding themselves disappointed. Starting salaries for college graduates across the United States are down in 2010. But why shouldn't starting salaries be down? It is the employers that hold all the leverage - not the new graduates. Meanwhile, many of these college graduates are graduating with crushing student debt loads. Today, many students borrow 10, 20 or even 30 thousands dollars per year while they are in school. Federal statistics reveal that only 36 percent of the full-time students who began college in 2001 received a bachelor's degree within four years. That is a very sad statistic. The truth is that college courses have become so "dumbed down" in 2010 that even the family dog should be able to graduate from most U.S. colleges in four years. Even after 6 years, that same group's graduation rate was still only 57 percent. Very sad. But getting back to the point, every single one of those years most college students are racking up huge amounts of debt. Today, approximately two-thirds of all U.S. college students graduate with student loans. Student loan balances of over $50,000 are becoming quite common among our college grads. In fact, some students end up with over $100,000 in student loan debt by the time they are done. Unfortunately, student loan debt is some of the cruelest debt out there. Federal bankruptcy law makes it nearly impossible to discharge student loan debts, and many recent grads end up with loan payments that absolutely devastate them financially at a time when they are struggling to get on their feet and make something of themselves. So what do you think? Can you identify with this article? Are you a recent college graduate or do you have a recent college graduate living back at home? If so, please feel free to share your story in the comments section below....
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| Gold At Long Term Trend Support, Key Level Highlighted Posted: 27 Jul 2010 04:46 PM PDT Gold is now reaching long term trend support after falling the last few weeks as investors returned to bid up the Euro and equities. The bounce in equities, especially financial, retail and real estate may be short lived as volume indicates that there is not much conviction from major investors on the upside. Gold has recently been the safe haven as investors sought shelter away from the Euro when it was having the sovereign debt issues. Now that those issues have been quelled, gold has had some selling and it has now reached an oversold condition and a long term trendline which is acting as major support. Stock prices move in trends. In a bull market, it is quite often easy to identify the ascending bottoms. Being familiar with trendlines allows the investor to enter long term bull markets when they are oversold and at key support. An investor must always be aware of a stock's underlying long term trend. This can be counter-intuitive and awkward, as most times when it comes down to support you have to think against the market herd and buy when others are selling. It's like buying a winter coat in the heat of summer. Gold is on sale, and presenting a low risk, high reward trade, but it requires non conformity with the crowd which is not an easy task for anyone. Many of us like to be in what's hot now situations, rather than seeing the bigger picture and entering into a trade when it is uncomfortable.
Gold is now at my buy point of the rising long term trend support line. GLD touched that line 6 times, which signifies that this trendline is a reliable point of support. The significance of this line is that it is not steep, which also brings a higher probability that GLD will find support here. It is also oversold. Continued weakness here and a break below this long term trend would be troubling and highly unlikely. If there is a break most likely it would be exhaustive, meaning that it will shake out a lot of shares before the next move higher. I do not see $1200 as a top in gold as there are no technical signs of a major top. On the other hand, financial stocks may be finding key resistance here following a low volume rally. As investors are digesting earnings reports that claim credit is improving and lending is increasing, consumer confidence is weakening and the unemployment rate is still very high. A jobless recovery is what many are considering we are experiencing. It seems that this recovery has been good for wall street while main street has not seen an improvement. The financials have found resistance at the 200 day moving average and have now failed four times, significantly breaking through this point of resistance. Historically speaking, after a few failed rallies a major drop could occur.
At the writing of this article, housing has also had a significant reversal after recent data showing an increase in pricing in some metropolitan areas. Investors are selling home building stocks on positive news, which indicates that there is some caution over what the real estate market will resemble after the home buyer tax credit expires. The chart shows a clear reversal and I expect that the rally in equities will be coming to an end and that gold's poor summer performance will be different this fall as many weak hands were shaken out. An explosive fall rally into new highs is expected as I still have a target of $1400 by year end. Disclosure: I own shares in gold and silver mining stocks.
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| Nevada's Economic Misery May Be America's Future Posted: 27 Jul 2010 04:42 PM PDT So many homes in Las Vegas have been foreclosed upon that banks rarely bother to hang a "For Sale" sign on the front lawn anymore. Instead, visitors identify bank-owned properties by the brown grass and the 8.5 x 11-inch sheet of paper taped to the front door or the garage. On a cul-de-sac in the once-pleasant neighborhood of Silverado Ranch, Larry Wood is the last remaining resident. Two of the four homes are in foreclosure and a third is a "party rental" only occupied by rowdy tourists on weekends. One of his neighbors made a few bucks before abandoning the home, he says. "They sold all the palm trees and just walked away from it," says Wood, sporting a "Freedom Isn't Free" T-shirt. "It's a great neighborhood. I guess that people weren't financially set up to get through the crash." Wood takes little comfort in being the last resident. "Sometimes it's scary. There's a possibility someone would try to rob me and I wouldn't have any neighbors to help me," he says, recounting a previous attempted intrusion when his then-neighbor called to warn him not to answer the door because there was a group of thugs knocking. Armed and ready, he huddled near the door but the gang gave up and left. Walking away is becoming a habit among law-abiding residents too. It's hard to find a home bought before 2009 that isn't underwater and very few landlords, when running credit checks, look for foreclosures or short-sales on a tenant's record. Otherwise, a manager couldn't fill a building. 
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| Posted: 27 Jul 2010 04:30 PM PDT July has not produced much in the way of excitement for shares. We have found out a few interesting things this month. One, as long as sovereign debt woes in Europe persist, U.S. Treasury bond yields can go lower. Investors seeking a haven from Europe don't seem to have any problem buying U.S. bonds at near record-low yields. This is bizarre. Of course at a superficial level, if you were concerned that the European bank stress tests were a sham and that interest rates in Europe could go much higher unexpectedly, you might view U.S. Treasury notes and bonds as "safe." This is only possible in a world of utter relativity. After all, the U.S. government ran a deficit of 9.9% of GDP in 2009. The Congressional Budget Office in Washington reckons next year's deficit will be $1.47 trillion. That forces the U.S. government to borrow 41 cents of every dollar it spends. Imagine if you ran your finances this way. But it's a strange old world we live in. Europe's problems have been America's blessing. Demand for U.S. Treasury bonds and notes is the highest on record, according to the Wall Street Journal. On July 23rd, the yield on two-year notes - a kind of near cash fight-to-safety proxy for big money - feel to 0.5516%. Ten-year notes briefly yielded less than 3% earlier this month and for the entire month of July, the U.S. Treasury managed to flog off $173 billion in bonds to investors. This is an important development. As long as global savers - for whatever reason - are frantically bidding for U.S. debt at auctions, U.S. borrowing costs should stay relatively low. It should also allow the Federal government to run its absurdly large and reckless deficits. And most importantly, if investors are buying U.S. debt it means the Fed doesn't have to, at least not yet. This last point is the most important, we reckon, because it averts the dreaded hyperinflationary scenario in which Fed money printing leads to an inflationary shock. So far, investors (who may have gone wobbly on stocks) have decided there is safety in numbers in the U.S. bonds market. We'll see how that works out for them. All this has taken some starch out of the gold price. You will have known about this if you read the latest salvo in Michael Pascoe's increasingly strange vendetta against gold in today's Age. He points out that spot gold prices are at three-month lows in New York and down 8% from the June highs. It's pretty obvious by now that Pascoe either doesn't understand gold's role as money or simply believes gold is an anachronism in which "money" can be created by central banks. Frankly it's a pretty unserious and mildly embarrassing argument to make given the last few years of economic events. But each to his own. The bigger issue is what will happen with the gold price from here. Yesterday we spent an hour on the phone chatting about this and other things with Greg Canavan, the editor of Sound Money. Sound Investments. Greg pointed out that the gold price doesn't normally perform so well during the North American summer. Our view? We'd be pleased to buy more gold on dips, even if for the year gold doesn't make a new high. Gold is insurance against financial disaster. And if you think there aren't any more financial disasters lurking, you're not thinking hard enough. And yes, this is a fear-based trade. We are worried that bad fiscal and monetary policies worldwide can wipe out savings, depress share markets, and destroy purchasing power. Totally wacky of course. But there you go. What about Aussie dominators though? Are there businesses in Australia that are so well positioned they can't help but make money? Greg sent us a note on that later in the day. "I'd have to say that there are very few Aussie 'world dominator' stocks, which is not all that surprising given the relatively small size of our economy. There are many things that go into making a business 'good'. It's not just all about growth, it's about profitable growth. High return on equity, smart capital management and sensible debt levels are just a few of the things to look for. But what most people don't realise is that a company can be all these things, but if it's not good value you will not make any money. "Think Woolworths and QBE a few years ago when their share prices were much higher. They were great businesses (and still are) but the price you were being asked to pay virtually guaranteed a low long term return. Here are a few candidates for the world dominators:
"And here are some that are not in the world class category, but definitely Aussie dominators:
Greg wraps up, "The aim of Sound Money. Sound Investments is to build a portfolio exposure of around 50-60% in these companies (buying at the right price of course) to provide stability and income. We are looking to have around 20% invested in precious metals with the remainder in promising/good value small cap stocks." To see what Greg's up to or sign up for a free trial to his newsletter, go to Sound Money.Sound Investments. Dan Denning
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| Crude Oil Falters Under $80, Gold Breaks Down to New Lows Posted: 27 Jul 2010 04:14 PM PDT courtesy of DailyFX.com July 27, 2010 07:41 PM Crude oil is not far from the midpoint of a 10-month range; further losses could lead to an attractive buying opportunity. Gold is battered and bruised after breaching multiple technical levels. Commodities - Energy Crude Oil Falters Under $80 Crude Oil (WTI) $77.09 -$0.41 -0.53% Commentary: Crude oil shed $1.48, or 1.87% on Tuesday, as prices failed to breach the psychological $80 level. Little has changed with regard to the crude oil outlook. Prices are above the midpoint of the 10-month range, which lies near $75.50. We would look for opportunities to buy at or under that level and sell near $80 or above. In the medium term, oil should eventually break out toward $90, but the fundamentals are not in place yet for that to happen. Tomorrow we get the EIA inventory report. The API survey was again bearish (Crude oil +3084K, Gasoline +877K, Distillate +407K). If the EIA numbers come in similarly bearish, ...
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| Gold Seeker Closing Report: Gold and Silver Fall Over 2% and 3% Posted: 27 Jul 2010 04:00 PM PDT Gold and silver waffled near unchanged for most of trade in Asia and London, but they then fell off rather markedly throughout trade in New York and gold ended near its late session low of $1157.75 with a loss of 2.2% while silver ended near its late morning low of $17.569 with a loss of 3.19%.
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| Tuesday ETF Roundup: GDX Tumbles, UNG Marches Higher Posted: 27 Jul 2010 03:50 PM PDT ETF Database submits: Equity markets stayed flat in much of Tuesday’s trading session with the Dow sneaking by with a gain and the S&P 500 and the Nasdaq both posting modest losses. However, despite the neutral nature of today’s equity markets, the 10 Year T-Bill finally broke back through the 3% barrier to finish the day at 3.05%. Commodity markets also struggled with oil and gold both falling close to 2% as the precious metal dropped close to $25/oz. in today’s trading. Today’s flat results came after consumer confidence fell in July to its lowest level since February due to consumers growing increasingly concerned about the weak job market and tepid economic growth levels. This bearish news was canceled out by several earnings reports which helped to boost the markets and keep most indexes even on the day. One of the day’s key reports came from DuPont which reported strong sales and boosted its guidance for the rest of the year, news which sent the stock up 4% on the day and helped to buoy the DJIA. For companies, “it seems growth hasn’t ground to a halt, and that is very important for the stock market,” said Marc Pado, U.S. market strategist at Cantor Fitzgerald & Co, in San Francisco. However, Marc went on to say that “the balance of the market is in a bit of a pullback phase, and consumer confidence is weighing today.” One of the biggest gainers on the day was the United States Natural Gas Fund (UNG) which jumped higher by 1.3%. This jump came after a bullish earnings report from Occidental Petroleum (OXY) which is the fourth largest U.S. oil and gas firm and the largest natural gas producer in California. OXY reported a profit of $1.06 billion, or $1.31 a share, up from $682 million, or 84 cents a share, a year earlier on revenues of $4.76 billion which represents a 29% increase from the prior year. However, the company missed its earnings estimate by 2 cents which sent shares down close to 3.6% in Tuesday trading but it appears as if the company has made up most of the losses in the after-hours session. Traders also bought the commodity due to hot weather which is expected to continue for the near future in much of the Eastern and Midwestern portions of the U.S. Many will now focus in on the weekly Energy Department report tomorrow in order to give UNG guidance for the rest of the week. “It’s pretty hot and the AC is running,” said Kyle Cooper, managing director at energy consultant IAF Advisors in Houston. “The next injection number is going to be pretty bullish.” Complete Story »
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| Jay Taylor interviews Swiss America's Fred Goldstein on investing in real metal Posted: 27 Jul 2010 03:41 PM PDT 11:40p ET Tuesday, July 27, 2010 Dear Friend of GATA and Gold (and Silver): On his most recent weekly Internet radio program, "Turning Hard Times into Good Times," newsletter writer Jay Taylor interviewed longtime GATA supporter Dr. Fred Goldstein of Swiss America Trading Corp. in Phoenix. They discussed GATA's work, the mechanism for holding gold in an Individual Retirement Account, and a gold coin investment strategy. You can listen to the interview here: http://www.webeatthestreet.com/media/archives/SwissAmerica20100713.mp3 CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Prophecy to Become Coal Producer This Year Prophecy Resource Corp. (TSX.V: PCY) announced on May 11 that it has entered into a mine services agreement with Leighton Asia Ltd. to begin coal production this year. Production will begin with a 250,000-tonne starter pit as planned in August, with production advancing to 2 million tonnes per year in 2011. Prophecy is fully funded to production and its management team includes John Morganti, Arnold Armstrong, and Rob McEwen. For Prophecy's complete press release about its production plans, please visit: http://www.prophecyresource.com/news_2010_may11.php Join GATA here: New Orleans Investment Conference * * * Support GATA by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: * * * Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Sona Resources Expects Positive Cash Flow from Blackdome, On May 18, 2010, Sona Resources Corp. (TSXV: SYS, Frankfurt: QS7) announced the release of a preliminary economic assessment for gold production at its flagship Blackdome and Elizabeth properties in British Columbia. Sona Executive Chairman Nick Ferris says: "We view this as a baseline scenario for gold production. The project is highly sensitive to the price of gold. A conservative valuation of gold at $1,093 per ounce would result in a pre-tax cash flow of $54 million. The assessment indicates that underground mining at the two sites would recover 183,600 ounces of gold and 62,500 ounces of silver. Permitting and infrastructure are already in place for processing ore at the Blackdome mill, with a 200-tonne per day throughput over an eight-year mine life. Our near-term goal is to continue aggressive exploration at Elizabeth and develop a million-plus-ounce gold resource, commencing production in 2013." For complete information on Sona Resources Corp. please visit: www.SonaResources.com A Canadian gold opportunity ready for growth
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| Jay Taylor interviews Swiss America's Fred Goldstein on investing in real metal Posted: 27 Jul 2010 03:41 PM PDT 11:40p ET Tuesday, July 27, 2010 Dear Friend of GATA and Gold (and Silver): On his most recent weekly Internet radio program, "Turning Hard Times into Good Times," newsletter writer Jay Taylor interviewed longtime GATA supporter Dr. Fred Goldstein of Swiss America Trading Corp. in Phoenix. They discussed GATA's work, the mechanism for holding gold in an Individual Retirement Account, and a gold coin investment strategy. You can listen to the interview here: http://www.webeatthestreet.com/media/archives/SwissAmerica20100713.mp3 CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Prophecy to Become Coal Producer This Year Prophecy Resource Corp. (TSX.V: PCY) announced on May 11 that it has entered into a mine services agreement with Leighton Asia Ltd. to begin coal production this year. Production will begin with a 250,000-tonne starter pit as planned in August, with production advancing to 2 million tonnes per year in 2011. Prophecy is fully funded to production and its management team includes John Morganti, Arnold Armstrong, and Rob McEwen. For Prophecy's complete press release about its production plans, please visit: http://www.prophecyresource.com/news_2010_may11.php Join GATA here: New Orleans Investment Conference * * * Support GATA by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: * * * Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Sona Resources Expects Positive Cash Flow from Blackdome, On May 18, 2010, Sona Resources Corp. (TSXV: SYS, Frankfurt: QS7) announced the release of a preliminary economic assessment for gold production at its flagship Blackdome and Elizabeth properties in British Columbia. Sona Executive Chairman Nick Ferris says: "We view this as a baseline scenario for gold production. The project is highly sensitive to the price of gold. A conservative valuation of gold at $1,093 per ounce would result in a pre-tax cash flow of $54 million. The assessment indicates that underground mining at the two sites would recover 183,600 ounces of gold and 62,500 ounces of silver. Permitting and infrastructure are already in place for processing ore at the Blackdome mill, with a 200-tonne per day throughput over an eight-year mine life. Our near-term goal is to continue aggressive exploration at Elizabeth and develop a million-plus-ounce gold resource, commencing production in 2013." For complete information on Sona Resources Corp. please visit: www.SonaResources.com A Canadian gold opportunity ready for growth
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| Stewart Thompson: Central banks will push gold up to rescue asset prices Posted: 27 Jul 2010 02:37 PM PDT 10:30p ET Tuesday, July 27, 2010 Dear Friend of GATA and Gold: In commentary posted tonight at 321Gold, newsletter writer Stewart Thompson joins those who expect central banks to revalue gold upward and devalue their own currencies. Thompson writes: "There is a middle step between quantitative easing and money printing, and it is gold revaluation. No confiscation is needed in the current crisis to make revaluation 'work,' because so few people own gold. The major central banks are already committed to major long-term gold buy programs (the opposite of the 1990s), and these buy programs are the mechanism of gold revaluation under a sort of guise of currency reserves diversification. "The central 'banksters' aren't stupid; they didn't get the market all wrong and accidentally sell their gold holdings into the end of the gold bear market, any more than the current buy programs are 'knee-jerk' reactions to a rising gold price. "The buy program is about gold revaluation, not rushing to buy gold as an asset. As QE is more and more broadly deemed a failure in the fund community, the central banks will step up their gold buy programs, stepping UP the price they pay for the gold, with tremendous vigor. "The buy programs of the central banks are not about adding gold to diversify their forex reserves; they are about devaluing paper money to raise asset prices, as blown marked-to-model OTC derivatives can then be marked to market." Thompson's commentary is headlined "It IS 2008 Again. So What's in Play?" and you can find it at 321Gold here: http://www.321gold.com/editorials/thomson_s/thomson_s_072710.html CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Sona Resources Expects Positive Cash Flow from Blackdome, On May 18, 2010, Sona Resources Corp. (TSXV: SYS, Frankfurt: QS7) announced the release of a preliminary economic assessment for gold production at its flagship Blackdome and Elizabeth properties in British Columbia. Sona Executive Chairman Nick Ferris says: "We view this as a baseline scenario for gold production. The project is highly sensitive to the price of gold. A conservative valuation of gold at $1,093 per ounce would result in a pre-tax cash flow of $54 million. The assessment indicates that underground mining at the two sites would recover 183,600 ounces of gold and 62,500 ounces of silver. Permitting and infrastructure are already in place for processing ore at the Blackdome mill, with a 200-tonne per day throughput over an eight-year mine life. Our near-term goal is to continue aggressive exploration at Elizabeth and develop a million-plus-ounce gold resource, commencing production in 2013." For complete information on Sona Resources Corp. please visit: www.SonaResources.com A Canadian gold opportunity ready for growth Join GATA here: New Orleans Investment Conference * * * Support GATA by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: * * * Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Prophecy to Become Coal Producer This Year Prophecy Resource Corp. (TSX.V: PCY) announced on May 11 that it has entered into a mine services agreement with Leighton Asia Ltd. to begin coal production this year. Production will begin with a 250,000-tonne starter pit as planned in August, with production advancing to 2 million tonnes per year in 2011. Prophecy is fully funded to production and its management team includes John Morganti, Arnold Armstrong, and Rob McEwen. For Prophecy's complete press release about its production plans, please visit: http://www.prophecyresource.com/news_2010_may11.php
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| Posted: 27 Jul 2010 02:17 PM PDT
Living in Montreal, I tend to focus way too much on Quebec and Ontario based funds. I was skimming through BC Investment Management Corporation's (bcIMC) website today and saw they posted their 2009-2010 Annual Report.
Just like PSPIB and CPPIB, which I recently compared in terms of their FY 2010 results, bcIMC's fiscal year ends on March 31st.
As shown in the table below, Private Placements and Real Estate underperformed their benchmarks (click on image to enlarge):
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| Hinde Capital's Ben Davies talks gold price suppression on CNBC Posted: 27 Jul 2010 02:10 PM PDT 10:10p ET Tuesday, July 27, 2010 Dear Friend of GATA and Gold: Somehow Hinde Capital CEO and GATA adherent Ben Davies keeps getting on business television programs to make subversive remarks about the gold market. Today Davies was interviewed for a few minutes by CNBC's Maria Bartiromo and observed matter-of-factly that central banks and "paper gold" have been suppressing the gold price to mask currency mismanagement. Bartiromo even seemed glad to have Davies on the show. You can watch it at the CNBC archive here: http://www.cnbc.com/id/15840232/?video=1552984313&lay=1 CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Prophecy to Become Coal Producer This Year Prophecy Resource Corp. (TSX.V: PCY) announced on May 11 that it has entered into a mine services agreement with Leighton Asia Ltd. to begin coal production this year. Production will begin with a 250,000-tonne starter pit as planned in August, with production advancing to 2 million tonnes per year in 2011. Prophecy is fully funded to production and its management team includes John Morganti, Arnold Armstrong, and Rob McEwen. For Prophecy's complete press release about its production plans, please visit: http://www.prophecyresource.com/news_2010_may11.php Join GATA here: New Orleans Investment Conference * * * Support GATA by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: * * * Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Sona Resources Expects Positive Cash Flow from Blackdome, On May 18, 2010, Sona Resources Corp. (TSXV: SYS, Frankfurt: QS7) announced the release of a preliminary economic assessment for gold production at its flagship Blackdome and Elizabeth properties in British Columbia. Sona Executive Chairman Nick Ferris says: "We view this as a baseline scenario for gold production. The project is highly sensitive to the price of gold. A conservative valuation of gold at $1,093 per ounce would result in a pre-tax cash flow of $54 million. The assessment indicates that underground mining at the two sites would recover 183,600 ounces of gold and 62,500 ounces of silver. Permitting and infrastructure are already in place for processing ore at the Blackdome mill, with a 200-tonne per day throughput over an eight-year mine life. Our near-term goal is to continue aggressive exploration at Elizabeth and develop a million-plus-ounce gold resource, commencing production in 2013." For complete information on Sona Resources Corp. please visit: www.SonaResources.com A Canadian gold opportunity ready for growth
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| Hinde Capital's Ben Davies talks gold price suppression on CNBC Posted: 27 Jul 2010 02:10 PM PDT 10:10p ET Tuesday, July 27, 2010 Dear Friend of GATA and Gold: Somehow Hinde Capital CEO and GATA adherent Ben Davies keeps getting on business television programs to make subversive remarks about the gold market. Today Davies was interviewed for a few minutes by CNBC's Maria Bartiromo and observed matter-of-factly that central banks and "paper gold" have been suppressing the gold price to mask currency mismanagement. Bartiromo even seemed glad to have Davies on the show. You can watch it at the CNBC archive here: http://www.cnbc.com/id/15840232/?video=1552984313&lay=1 CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Prophecy to Become Coal Producer This Year Prophecy Resource Corp. (TSX.V: PCY) announced on May 11 that it has entered into a mine services agreement with Leighton Asia Ltd. to begin coal production this year. Production will begin with a 250,000-tonne starter pit as planned in August, with production advancing to 2 million tonnes per year in 2011. Prophecy is fully funded to production and its management team includes John Morganti, Arnold Armstrong, and Rob McEwen. For Prophecy's complete press release about its production plans, please visit: http://www.prophecyresource.com/news_2010_may11.php Join GATA here: New Orleans Investment Conference * * * Support GATA by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: * * * Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Sona Resources Expects Positive Cash Flow from Blackdome, On May 18, 2010, Sona Resources Corp. (TSXV: SYS, Frankfurt: QS7) announced the release of a preliminary economic assessment for gold production at its flagship Blackdome and Elizabeth properties in British Columbia. Sona Executive Chairman Nick Ferris says: "We view this as a baseline scenario for gold production. The project is highly sensitive to the price of gold. A conservative valuation of gold at $1,093 per ounce would result in a pre-tax cash flow of $54 million. The assessment indicates that underground mining at the two sites would recover 183,600 ounces of gold and 62,500 ounces of silver. Permitting and infrastructure are already in place for processing ore at the Blackdome mill, with a 200-tonne per day throughput over an eight-year mine life. Our near-term goal is to continue aggressive exploration at Elizabeth and develop a million-plus-ounce gold resource, commencing production in 2013." For complete information on Sona Resources Corp. please visit: www.SonaResources.com A Canadian gold opportunity ready for growth
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| Jul 27- Trading The Waterfall Declines for Profits Posted: 27 Jul 2010 02:09 PM PDT By David Banister, Active Trading Partners Here at Active Trading Partners, we like to look for reversals. Sometimes reversals are from extreme oversold conditions if you are scaling into a long position in a stock or ETF, and of course if you are going short they are from extreme overbought conditions. There are a few ways to reduce your trading risks and we employ those at ActiveTradingPartners.com. 1. We use a "Scale in and Scale out" method for entering and exiting our trades. This means we look to buy in tranches of about 1/3 of an intended $$ position at a time. We look for Fibonacci pivots and oversold indicators to begin working into a position, but never all at one time. 2. We look for "Waterfall declines". That is right, we like to buy when everyone else likes to cry. This means we prefer to enter trade set ups when it appears the vast majority of the downside risk has been "wrung out" as it were. Recent example was our entering OREX at 4.01-4.12 after it had waterfall declined from $6 at it's high. The stock rose over 18% within 72 hours. 3. We like Waterfall patterns in ETF's as well, trading the opposite pair off the baseline ETF. For example, if I think the SP 500 index is in the process of topping out, then we take positions in the Bear ETF such as BGZ to take advantage of the upside exhaustion and corrective reversal. We enter into the BGZ trade 1/3 tranche at a time, carefully watching for Fibonacci pivots, Elliott Wave patterns, and exhaustion signals. If you would like to improve your risk adjusted trading results, minimize your losers and maximize your winners, please give us a try. Click HERE to subscribe you'll be up and running in no time!
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| What a Run on Gold Bullion Banks Could Look Like Posted: 27 Jul 2010 02:06 PM PDT Without any particular intention of bolstering gold market conspiracy theories, it is interesting to take a look at the London Bullion Market Association's recent decision to go dark on what have been — for 13 years — publicly available statistics regarding the trade between its member bullion banks. Here's an assessment (with references removed, but available in the original post) from the decidedly-biased Gold Anti-Trust Action Committee (GATA): "When the LBMA first made its trading statistics available in January 1997, observers and analysts were shocked. No one could reconcile the statistics with other market data, nor comprehend how the bullion banks could be trading on a net basis more than 240,000 tonnes of gold annually while the global mine output was only 2,400 tonnes. "Over the years the furor over these statistics had subsided until the end of 2009, when I commenced writing about my studies, showing that the statistics can be reconciled with other market data if the bullion banks are operating a fractional-reserve bullion banking operation with a recklessly low reserve ratio. I have also shown how the price of gold is suppressed because 45 ounces of demand are being diluted to result in purchase of only 1 ounce of real metal. If instead all 45 ounces were to be sourced and purchased, the gold price would be multiples of the current price… "…In June the LBMA trading statistics showed that in May 2010 the average net daily trading in gold by LBMA member banks jumped a massive 50 percent from the month before to 24 million ounces each day from 16 million ounces each day. That translates to $7.5 trillion annually. If an operation is running on a razor-thin fractional reserve basis, such step changes are often fatal. It appears that a run on the bullion banks has commenced." At this time, there's not much additional coverage of the London Bullion Market Association's change in protocol. However, in conjunction with the Bank of International Settlements' recent, seemingly unintentional, and certainly uncomfortable, disclosure of 346 tonnes in gold swap operations, it seems worthwhile to at least be aware of larger than average movements in the murky background of the international gold market. You can read more details in a GATA post on the LBMA's unusual step of blocking access to statistics. Best, Rocky Vega, What a Run on Gold Bullion Banks Could Look Like originally appeared in the Daily Reckoning. The Daily Reckoning, offers a uniquely refreshing, perspective on the global economy, investing, gold, stocks and today's markets. Its been called "the most entertaining read of the day." More articles from The Daily Reckoning….
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| Gold Prices Fall to 3-Month Low, Silver Plummets 3.2% Posted: 27 Jul 2010 01:48 PM PDT
Other metals tracked gold, with silver sliding the most at 3.2 percent. Platinum lost 1.2 percent while palladium dipped 1.8 percent. Weaker-than-expected U.S. consumer confidence data was cited for pulling down crude prices and deflating U.S. stocks. Oil fell 1.9 percent while the major indexes ended mixed, ranging between -0.40 percent and 0.15 percent…. Read the rest of Gold Prices Fall to 3-Month Low, Silver Plummets 3.2% (575 words) © 2010 CoinNews Media Group LLC
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| Technical Weakness Continues for Gold and Metals Miners Posted: 27 Jul 2010 01:47 PM PDT Street One Financial submits:
On July 11th, with GLD rebounding somewhat and trading around the $119 level, a note was published by Street One Technical Analysis LLC to our Seeking Alpha instablog speaking of bearish institutional options activity that we observed in XAU (Gold and Silver Miners Index) that seemed to be a play on the burgeoning technical weakness in the Gold commodity ETFs (GLD, SGOL, IAU, DGL, etc.). In the XAU, bearish combos traded (buyers of puts and sellers of calls, taking outright short positions in the index) in September options. Based on recent action in the sector, these trades appear to be well timed.
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| What’s With the Gold ‘Strength Index’? Posted: 27 Jul 2010 01:47 PM PDT Hard Assets Investor submits: By Brad Zigler Reactions to yesterday's missive ("Shootout At The 24K Corral") proved one thing: Not everybody is off on their summer holidays or, if they are, they're staying wired. (No, not wired. That's so last generation, but I'm not sure that the phrase "they're staying wirelessed" is proper.)
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| Posted: 27 Jul 2010 01:47 PM PDT Trader Mark submits: I mentioned yesterday when I closed out the gold position that we had since spring 09, that the chart looked more like something I'd short than go long. However, the movements in this commodity are so random at times, I don't really like to get involved on the short side. But in retrospect, it looks like "short" would have been a good move. I am using the gold ETF (GLD) for charting purposes (since stockcharts.com has a 1-day delay on commodities) but the actual commodity is down to $1159 or so… the ETF tracks the commodity quite closely.
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| Capital Gold Group Report: University of Texas’ Money Manager Shifts $500 Million into Gold Posted: 27 Jul 2010 01:46 PM PDT Houston Chronicle AUSTIN — Fearing unstable international financial markets and the The purchases With the state's endowment funds designed to generate a "If there's no inflation, that dollar today in gold "Recently we've added 3 percent … of our "I Two of Other UTIMCO executives suggested the endowments have begun to UTIMCO It's now back up to $22.3 billion.
Capital Gold Group, gold group, gold, gold prices, gold news, gold coins, gold bullion, gold IRA, IRA
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| Capital Gold Group Report: 103 Failed Banks to Date in 2010; Problem Bank list hits 775 Posted: 27 Jul 2010 01:46 PM PDT According to the FDIC website, 103 banks have failed thus far in 2010. In addition to the 140 that failed in 2009, the total is 236 – and counting. In May, CNN reported that the problem bank list had reached 775.
Problem bank list hits 775 By David Ellis, staff writer, May 20, 2010: 12:51 PM ET
NEW YORK (CNNMoney.com) — The government's list of troubled banks The numbers, published as part of a broader survey on That figure stood at 702 in the fourth quarter of 2009. A year ago, Still, the fact that the number of problem banks rose by That figure stood at 702 in the fourth quarter of 2009. A year ago, Still, the fact that the number of problem banks rose by "You can clearly see the rise in problem institutions moderated in the first quarter," said FDIC Chairman Sheila Bair. Banks that end up on the problem list are considered the most likely The names of the banks on Problems peaking? The FDIC also reported a The fund grew by $145 million So far this year, 72 She noted however, that the agency was expecting the Overall, the report painted a more healthy picture of the banking industry than a year ago.
Big Banks Rake It in Again
Banks Much of that jump was attributed to big banks like Citigroup (C, Fortune 500) and Bank of America (BAC, Fortune 500), who returned to profitability in the latest quarter. Another The latest reading on the health of the industry provided little boost to bank stocks Thursday, however. The
Capital Gold Group, gold group, gold, gold pric |
| Posted: 27 Jul 2010 01:21 PM PDT The following is automatically syndicated from Grandich's blog. You can view the original post here. Stay up to date on his model portfolio! July 27, 2010 04:41 PM U.S. Stock Market – Throughout 2009 and at least twice this year, I received many inquiries on why I didn't short the stock market and now I missed a big decline (the last two centered around the DJIA breaking below 10,000). My answer then and still now is I don't see a sharp fall but rather a no where's fast style trading pattern for the foreseeable future. I would consider some bearish call spreads if the DJIA somehow got near 11,000 before the November elections. I've noted on several occasions there's an either an always long or short mentality among many retail and even some professional traders. Not being either seems to be as tough for many as it is for a horse racing fan not to bet every race. You got to be in it to win it may be a good lottery ticket marketing ploy but isn't to me for both gambling facilities; th...
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| Underlying Bid In Equities Evident, Yet Buyer Remains Untested By Volume Posted: 27 Jul 2010 01:09 PM PDT
After todays session it definitely feels like there's a big market participant (most likely government + GS) desperately trying to breakdown every "overowned/saturated" market (specifically Gold and Treasuries) in order to force all that "sidelined" capital into the equity market and create a summer rally. Yet thus far we're not seeing any real underlying bid in higher beta sectors like tech which would signal anticipation of a strong upside move in equities. Industrials however are seeing some buy interest and they could definitely be the sector to lead us higher, but outside of those high quality low beta names, what else is there to buy? Tech and retail are too highly exposed to consumer spending which is still being bogged down by high unemployment, commodities and Oil services facing headwinds from tepid global and domestic demand as well as pending regulatory issues regarding deep water drilling, financials facing headwinds primarily from continued weakness in housing prices, flattening yield curve, and uncertainty regarding effect of recently passed financial reform bill. So the issue is do we have enough sectors showing strength to aggressively get long this market? In our opinion the answer is no. In fact there are many more sectors showing weakness than strength. We can also point out that volume has been extremely low on this upswing, however this internal indicator has lost some semblance of validity due to the Feb-April rally we saw this year which rallied the market straight up from 1060 to 1220 on absolutely anemic volume. And while we recognized a big buyer in markets back in February and called for new highs (see Feb. 25th - 8:16PM EST entry "Market Headed To New Highs As Major Buyer Remains Active"), this market doesn't have the same feel just yet. We have yet to see our current buyer tested by a huge uptick in sell programs which would make us certain that he is ready to defend the indices no matter what and take this market markedly higher, and until then its tough to jump on his "artificial" back and ride this rally. What we'd really like to see to get long this market is some sort of "bad" news hit the tape, a very heavy uptick in sell side volume (at least +300M on SPYs by days end) with our buyer sucking up relentless waves of sell programs intraday, and then close the market signficantly off its lows or even green. We saw this exact behavior back in late February just before the breakout, and if its the same buyer, we'll see it again which would signal a very strong move higher possibly back to our 1220 highs. Until we see this confirming signal, one really has to stick to more discernible indicators which continue to signal this rally has little to no foundation www.matrixanalytix.com
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| Why do U.S. Asset Managers fear Government Confiscation of Gold? Part 1 Posted: 27 Jul 2010 01:00 PM PDT Mr John Levin of HSBC in a recent gold conference pointed out that some top U.S. Asset Managers were fearful of the possibility of government confiscation of gold. He explained, that on being told that the bank's U.S. vaults had sufficient space available for their gold he was told that they did not want their gold stored in the U.S.A. but preferably in Europe because they feared that at some stage the U.S. Administration might follow the path set by Franklin D. Roosevelt in 1933 and confiscate all U.S. gold holdings as part of the country's strategy in dealing with the nation's economic problems.
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| Posted: 27 Jul 2010 12:27 PM PDT I want to discuss something that came up on the blog Friday. An anonymous poster hinted that we were going to see more gold weakness in the days ahead because big money was having to sell positions. Folks, big smart money traders don’t sell into weakness. These kind of investors don’t think like the typical retail investor who is forever trying to avoid draw downs. Big money investors take positions based on fundamentals and then they continually buy dips until the fundamentals reverse. The fundamentals haven’t reversed for gold so I’m confident in saying that smart money isn’t selling gold, it is using this dip to accumulate. With that being said there are times when big money will sell into the market and it is why so often technical analysis as it’s used by retail traders doesn’t work. They do so in order to accumulate positions. Let me explain. When a large fund wants to buy, it can’t just simply start buying stock l...
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| Stock Picks From the Vancouver Conference Posted: 27 Jul 2010 12:15 PM PDT "President Obama said he would've fired Lloyd Blankfein, the head of Goldman Sachs, if he worked for the White House... Unfortunately, the White House works for Goldman Sachs." - from my presentation at the Agora Financial Investment Symposium. I'm back from the Agora Financial Investment Symposium in Vancouver. As usual, this great event offered a diverse mix of ideas. Doom seemed to prevail often enough, with many speakers calling for a healthy drop in the stock market and challenging economic times ahead. Even so, there was plenty of enthusiasm for certain ideas. More about which, below... One of the pleasures of being in Vancouver is getting The Globe and Mail delivered to your room every morning. It's a good paper, and with Canada's resource-based economy, it tends to carry worthy stories on what's happening in the resource sector. More than a few caught my eye, as they covered areas I've been watching of late. For instance, there was a story about how Canadian companies are becoming increasingly active in Colombia. There has been something of a resource boom down there, as the country enjoys some stability. There are 17 listed Canadian companies with a presence in Colombia. The lure is the untapped oil reserves. There hasn't been much exploration in 50 years. Already, Colombia is the third-largest South American producer of oil after Venezuela and Brazil. Oil is its biggest export. I have a Colombian oil company I've been researching as a possible recommendation. Either way, I'll share with you what I've learned about the opportunities unfolding in Colombia. There was another fascinating story about how Canada ships more and more of its oil to Asia, in particular China. Currently, one ship leaves every month carrying 600,000 barrels of crude oil. That's a trickle, but Canada's two biggest pipeline companies are looking to lay pipe and ship massive amounts of oil to Vancouver, en route ultimately to China. The appeal of Canada's oil sands has improved mightily over just the last 12 months. For one thing, the troubles in the Gulf and deep-water drilling make land sources of oil look a lot less risky. Secondly, China's appetite for crude oil continues to grow. (Last week, the IEA reported China is now the world's largest energy user, surpassing the US.) And now this: new pipelines. The pipelines do two things. One, they lessen Canada's dependence on the US, which has been murmuring about greenhouse gas legislation. Such legislation would make it more difficult for Canada's oil sands to find buyers in the US. Secondly, the pipeline companies actually make more money selling to Asia. Enbridge says it can earn $2-3 more per barrel selling to the Chinese. At 550,000 barrels a day - the estimate for one pipeline - that's a lot of extra cash. I'm looking over a small heavy oil player in Canada that appears to trade at a deep discount to its underlying assets. Another story that caught my eye was about wheat. I don't know if you've noticed, but wheat prices are up a third in just the last six weeks. The main culprit is too much rain or too little rain in Russia, Europe and Western Canada. So wheat prices are flying. It seems like just two months ago, everybody was chipper about having bumper crops in all the grains. Now weather has suddenly gotten bad and wheat is up a third. You never know anything about crop prices until they hit the bin. Longer term, though, we know we're going to need to grow more food. There are many ways to get there - fertilizer, irrigation, new acreage, etc. Returning to the Vancouver conference, many of the most compelling investment ideas featured investments in oil, emerging markets, agriculture and water. My friend Rick Rule, a great resource investor and speculator, put in some bullish words for potash and water. He mentioned a few different "water plays" like PICO and Limoneira (LMNR). In my presentation, I encouraged people to invest overseas. I also talked about the growing bulge of new consumers in emerging markets. Finally, I put in some kind words for farmland and agricultural markets. In my workshop, I talked about a few specific stocks. The general idea was to present some stocks that did not require you to have much of an opinion about the economy. Lots of people hold tightly to such opinions. I asked how many people thought we would have a double-dip recession in the next two years. Almost everyone's hand went up. No one thought we'd avoid that fate. Then I asked how many people had no idea. A few hands went up. Honest people, I say. I don't have any idea either. It's something that's unknowable. There are too many shifting variables. A strong conviction on a double dip is like having a strong conviction about next month's weather. It's a tough call. But you don't really have to know the answer to the double-dip question to invest well. Too often, people think that a poor economy makes for a bad investing environment. But that's not always true. It depends on prices. Right now there are some interesting bargains out there. Anyway, four of the stocks I mentioned are existing recommendations from Capital & Crisis: Gulfport Energy (NASDAQ:GPOR) - An oil and gas company based in Louisiana. Besides solid producing assets in the US, it owns 131,000 net acres of oil sands in Canada via an investment in Grizzly Oil Sands. Recent transactions support valuations of $3,000-14,000 per acre. In per share terms, that's $9-42 per share for Gulfport, which trades for only $13.50. It's a stock greatly skewed to the upside with lots of asset value supporting the current stock price. Loews Corp. (NYSE:L) - A conglomerate with interests in three publicly traded companies: Diamond Offshore, Boardwalk Pipeline and CNA Financial. The value of its stake in these three alone equals the stock price. You get the reset of the company free, which includes cash, HighMount (a natural gas company) and other investments. Total net asset value is $50 per share easy. The stock is $37. FEMSA (NYSE:FMX) - A Mexican blue chip with interests in two publicly traded companies: Coca-Cola FEMSA and Heineken. FMX owns the third business outright. It is OXXO, a chain of convenience stores. The implied valuation for OXXO is about half publicly traded comparables. Net asset value for FMX is close to $60 per share. The stock is only $46. Foster Wheeler (NASDAQ:FWLT) - A large engineering and construction firm. FWLT is flat-out cheap, trading at an earnings multiple of only 5-6 times net of cash. The stock is more than 70% off its high. The business is picking up again, yet the market values it as if earnings are about to fall off the table. I could've gone on to mention more. But really, I don't think you have to have a positive view of the economy to own these names, which provide ready discounts to assets and/or potential earnings. And I would urge all investors to continue seeking out the kinds of stocks that can deliver strong returns, even if the economy simply muddles along. Chris Mayer
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| Posted: 27 Jul 2010 12:07 PM PDT [COLOR=#000000][FONT=Arial][COLOR=#000000]John Browne - Senior Market Strategist, Euro Pacific Capital. [/COLOR][/COLOR][/FONT] At long last, a good portion of mainstream economists now concede that a 'double dip' recession is in the cards for the United States. To head off the pain, sixteen top economists addressed an open letter to the President urging him to "stimulate" the economy with a massive new round of government spending. We feel this is a recipe for driving a recession into a depression. However, there can be few doubts that such a move is being considered in the highest policy circles. Flush from victories in financial regulation and healthcare, the Administration may feel the conditions are ripe to push through another bold initiative. If so, the United States may find itself in a very diminishing bloc of nations who fail to appreciate the magnitude of the global debt crisis. Its policies will become increasingly at odds with the drift of other world p...
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| How much do you put in PMs vs. FRNs in case you need cash? Posted: 27 Jul 2010 12:07 PM PDT I just sold 120 ozs. of silver over the weekend to another prepper so I could come up with the cash for a down payment on the homestead that my fiancee and I are buying. Everything has happened really quickly--this house was just offered to us three weeks ago, a bank repo for $30K--and except for about $1,000 cash I keep in a secure, undisclosed location in case I need immediate FRNs, I've been putting all of my spare cash in silver. My fiancee and I haven't talked about every aspect of managing our collective money after we get married--she's disabled and I will probably continue to make substantially more than her--but I've been talking to her over time about how PMs are a hedge against inflation and otherwise worthless paper investments (FRNs, Enron stock, etc.), but she's still raised an eyebrow or two when I told her how much silver I'd bought over time. I know that the conversation will come up at some point about my continuing to buy silver in lieu of having a large amount of FRNs readily available, but the sale of my silver this past weekend should (I hope) be an effective point of reference about why buying and/or liquidating silver isn't bad when it comes to saving up REAL money, but I'm curious to know how any of the rest of you have handled this with your significant others. I'm guessing that I'm not the only one who's had challenges in convincing their SO that holding PMs under just about any circumstance is preferable to holding FRNs (as long as at least some FRNs are readily available). Any thoughts or suggestions?
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| Countdown to Gold's $1300 Assault Posted: 27 Jul 2010 12:03 PM PDT We remain convinced that gold has yet to make its high for the year, and expect an assault on $1300 to begin in about a month from now. Despite our bullishness, we are not convinced that buying more call options on gold is ... Read More...
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| Honest Money Gold and Silver Report: Market Wrap Week Ending 7/23/10 Posted: 27 Jul 2010 11:44 AM PDT Since reaching its all-time high in June, gold has been in a short term downtrend, as defined by its declining price channel. RSI has turned up and MACD is slowly curling up, as if getting ready to make a positive crossover. Read More...
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| Spending Cuts in the Age of De-Leveraging Posted: 27 Jul 2010 11:42 AM PDT As we were saying yesterday, there are several schools of thought regarding the present economy.
And then, there's the solitary Daily Reckoning home-school view: We're not recovering...we're headed into soft-core, Japanese-style deflation. Who's right? You will recognize our point of view as the same thing we were saying 10 years ago. Of course, we changed our mind about it - more or less - once or twice in the intervening years. After the big build-up of debt in the mid-00s, we didn't think the US could afford a long, soft, slow de-leveraging a la Japan. The Japanese had savings...and a positive trade balance. They could afford an order on-again, off-again recession...while their government squandered the savings of an entire generation. But the US has a huge negative trade balance...and little in the way of savings. How could it survive a Japan-style slump? Well, things evolve...and our views evolve with them... And in this case, they've evolved right back to where they were in the first place. Savings rates are going up. Most other governments - other than the USA - are making an effort to reduce their reliance on borrowing. This leaves enough money available to finance US deficits - not indefinitely, but perhaps for a year or two more...maybe even for 5 or 10 years. Could we be wrong about this? You bet. Should you bet your future on it? No sirreee... But we're probably right... The following item will seem like we're changing the subject. Au contraire. It was reported in The Globe and Mail that the Irish have gone back to exporting what they export best - people. You'll recall that the late, much-regretted boom had completely transformed the Emerald Isle. All of a sudden, the Irish were the richest people in Europe (based on the value of their houses, mostly)...and hundreds of thousands of Poles and other immigrants were streaming into Ireland in order to find work. Practically all the waitresses and barmaids in Dublin seemed to have an Eastern European accent. And there was even a Polish-language TV station. Can you believe it? But then came the bust. Suddenly, the Irish had to come back down to the bog. The jobs disappeared. Housing prices fell (though not yet as much as you'd expect). And the immigrants began to go home. Along with the immigrants were many native-born Irish too, Yes, "The Irish Exodus" has resumed, reports The Globe and Mail. "Hundreds of thousands of immigrants used to flock to Ireland, looking for work at the door of Europe's strongest economy. But after two decades and a stunning collapse, Ireland is once again a nation of emigrants, seeking employment elsewhere to escape the sad reality at home." Oh well, it was bad while it lasted. Now, the Irish can give up property development and go back to poetry and alcohol. The country may not be as prosperous, but it will surely be prettier. Seventy thousand people are expected to leave the island this year. By 2015, the total is expected to rise to 200,000, if unemployment trends continue. Where are they going? Canada. New Zealand. Australia. No mention was made of the USA. But what is most interesting to us is the story behind the story. Ireland is not only the European nation the farthest out to the West. It is also the one the farthest out in front in the fight against deficit spending. While others dilly-dallied, Ireland cut. It bailed out its big banks...and then had to protect its own credit. But despite deep cuts, the deficit remains stubbornly high. At 11% it is in line with the US, which hasn't made any effort to cut at all. What went wrong? It appears that the neo-Keynesians Krugman and Wolf are right about at least one thing. Cutting government spending while the private sector is de-leveraging is a hard way to go. (In our opinion, it is the right way to go...but that's another issue!) What happens is that as the feds cut back it reduces income to the private sector, which is itself in cutback mode. This then causes tax revenues to fall - which increases the deficit... You end up with a vicious cycle of cuts, deficits and more cuts...which doesn't worry us...but the feds don't like it. And the public doesn't care for it much either. Better to wait until the private sector has finished de-leveraging, say most experts. Of course, then you are only building up public sector debt - which will have to be repaid sometime. You are also wasting resources - forever - making people absolutely poorer than they otherwise would be. But we're going to let it slide, today. The point we are reaching for is that de-leveraging isn't easy. It's like growing old. That's not easy either. Still, it's better than the alternative. And as for which of the views is correct - recovery, inflation, hard deflation or soft deflation - we'll just have to wait to find out. And more thoughts... We took two of our sons with us to Vancouver. It was a long, expensive trip. But the boys found some discount tickets and seemed sincerely interested in what we were doing there. You never know what will make an impression on teenaged boys. Maybe one would want to join the family business? Maybe one would take an interest in finance or economics...a fallback, in case they can't find more respectable careers. They got to meet our friends. They got to hear economists. Stock analysts. Commodity experts. Geologists. Stock promoters. Medical research scientists. It was a good introduction to the world of investment...and to the strange world in which their father lives... "Well, what do you think?" we asked them. "I don't know Dad," said Henry, 19, "everybody is just guessing. Nobody knows anything. I think I'll stick with medicine." "How about you, Edward?" "I want to do something where I can earn a lot of money without really working very hard." "I'm not sure that is a good approach," we replied. But Edward voiced an interest in geology, following a class trip to New Mexico. So, we went to see Rick Rule, a geologist, for advice. "Well, there are two types of geologist," Rick explained. "There are the rock hounds, who just love rocks. And there are the alchemists, who turn rocks into money. "And when there's a real bull market in the mining sector they don't even need rocks. All they have to do is claim to be looking for rocks and they can turn paper into money." "Sweet," said Edward. Regards, Bill Bonner
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| Gold — a hedge against uncertainty Posted: 27 Jul 2010 11:38 AM PDT By Jonathan Spall, Barclays Capital However, what do you do about a product that is a hybrid of the two? Where some investors focus on its commodity aspects and others on its currency features. That is the problem with gold. … an investment that is trumpeted as being outside the financial system is irrelevant when there is trust in that system. Remove that, and in a period of uncertainty and financial stress this notion of being separate is key. So, as the world focused on expansionary monetary policies and quantitative easing (printing money) the fear was of inflation. However, with the idea starting to take hold that the world is no longer facing the threat of rapidly rising prices but of deflation, does this then negate the argument? Gold … has in fact one very simple attribute — it is a hedge against financial uncertainty and dislocation. While investors remain unsure of the future and of the ability of their governments and monetary authorities to return to a time of steady growth and prices, then the attractions of gold will remain. [source]
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| Posted: 27 Jul 2010 11:32 AM PDT
News headlines state that cleanup workers are having a hard time finding oil. Sounds good, right? Actually, if BP had let things run their course:
Intead, BP has used millions of gallons of dispersants to hide the oil by breaking it up, so it sinks beneath the surface. That means that oil-skimming vessels can't find it or suck it up. As the Times-Picayune pointed out on July 16th:
Similarly, the use of dispersants means that Booms can't stop it from hitting the shore. As marine biologist and oil spill expert Paul Horsman explains, using dispersants and oil booms are competing strategies. Specifically, breaking something down into tiny bits and dispersing it throughout a mile-plus deep and hundreds-miles wide region (the reason massive amounts of dispersants are being applied at the 5,000 foot-deep spill site as well as at the surface) makes it more difficult to cordon off and contain oil on the surface (the reason booms are being used). And Corexit might be killing the oil-eating bacteria which would otherwise break down the oil. University of Georgia scientist Samantha Joye notes that scientists have no idea how the large quanties of dispersant will effect the Gulf's microbial communities (for more information, watch part 1, part 2, part 3, part 4 and part 5 of Dr. Joye's July 13th press conference). And as Mother Jones wrote in May:
So it's not a good thing that clean up workers can't find the oil. It means that the oil will lurk under the surface, poisoning the sealife that lives beneath the surface, and washing back up during storms for years to come. Even Admiral Thad Allen, the government's point man for the crisis, said that breaking up the oil has complicated the cleanup. As AP reported on June 7th:
And Admiral Allen admitted in his press conference yesterday that oil could re-surface far into the future:
As Congressman Markey said today, BP has made the Gulf “a toxic bowl” that will “haunt this region” for years, because “all of that oil is still under the surface”:
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| Gold Community Will Not Make The Most Profit On Gold's Rise Posted: 27 Jul 2010 10:27 AM PDT My Dear Friends, I have said to you many times that the entities that will make the most profit on the gold price will not be the gold community, but rather just those that the community identifies as the enemy, the gold banks. What is happening now is the setup to that event. Recently Armstrong questioned publicly if the Goldmans of the world were using his cyclical analysis. Judging from what we have seen the answer is yes by intention or coincidence. Those wishing to offset their pain on me today have to be defined as the public. The only bulls today are the stone professionals who can see what is taking place in the published numbers. The gold banks are engineering their short cover and will shift to the long side of gold. It is in fact happening right now as the public panics. The currency market and media will be called into service in order to take gold to and through $1650. Respectfully,
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| This Nasty ETF Indicator Is Flashing Again Posted: 27 Jul 2010 10:17 AM PDT By Tom Dyson Tuesday, July 27, 2010 In early 2007, investors were reading news stories about hundreds of new ethanol plants… enormous demand for grain in China… and rice shortages in Thailand. Potash and farm-equipment stocks were soaring. The world's most widely published investment gurus – like Jim Rogers and Marc Faber – were touting agriculture and farmland as their favorite investments. In short, agriculture was quickly becoming one of the most sought-after new investments in America. But you couldn't speculate directly on agriculture unless you had a futures account. Wall Street stepped in and issued new exchange-traded funds (ETFs) to fill the gap in the market and supply investors with the "one-click" agriculture investments they were demanding. Between September 2007 and January 2008, six new agriculture ETFs launched… In late February 2008, the agriculture bubble popped. Nine months later, these ETFs were down an avera...
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| LGMR: Gold & Dollar Slip, Silver Gains with Stocks & Commodities Posted: 27 Jul 2010 10:16 AM PDT London Gold Market Report from Adrian Ash BullionVault 08:20 ET, Tues 27 July Gold & Dollar Slip, Silver Gains with Stocks & Commodities THE PRICE OF GOLD slipped back below $1185 an ounce in London trade on Tuesday morning, holding above yesterday's 1-week closing low but remaining "directionless" according to one Chinese dealer. "Investors are unclear about the immediate trend," agrees Pradeep Unni at Richcomm Global Services in Dubai, telling Reuters that "physical gold buying is only expected to emerge by the end of this month." But "Current levels [of physical gold buying] compare well with previous highs reached earlier this year and late-2009," says Walter de Wet at Standard Bank. "We expect support from the physical market to increase towards Q4:10. Buying of gold for jewelry demand, especially in India, may increase in August/September." On the broader financial markets today, European equities rose to new 10-week highs as Deutsche Bank and UB...
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| ECB President John-Claude Trichet Challenges Inflationism Posted: 27 Jul 2010 10:13 AM PDT Well, the Monday gold chart looks suspiciously like the Friday gold chart. In Far East trading, gold gained a few bucks... but shortly after London opened, the selling pressure began. There was a bit of a rally at the Comex open in New York, but starting at 9:30 a.m. Eastern, the really serious selling began... and by shortly after 11:00 a.m. the low for the day was in at $1,178.60 spot. From that low, gold recovered about five bucks going into the close of electronic trading in New York. Because of the scale of the graph, Monday's action in silver looked more exciting than it really was. The low of the day [around $17.95 spot] appears to have been at the London silver fix at 12:00 noon in London, with a double bottom at precisely one hour later at 1:00 p.m. in London... moments before the Comex in New York began to trade. The high [$18.29 spot] was in shortly after 9:00 a.m. in New York... and that was basically it for the day. Between the ...
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| S&P Priced In Gold: Comparison Between The Great Depression And Now Posted: 27 Jul 2010 09:52 AM PDT
For those looking at the recent moves in the gold chart with disenchanted amusement, here are some scenarios to ponder. Below are the recent cycles associated with the S&P priced in gold, where it can be seen that the ratio is once again climbing minutely to the upside, just below 0.96. That's fine, although as the chart demonstrates the lower low moves occur with greater frequency and greater downward momentum with each iteration.
Yet where this chart gets interesting is when it is recreated from the perspective of the 1930s. As can be seen, the recent lows in the ratio at around 0.9 are a joke compared to the nearly 0.2 achieved in 1932... just before FDR decided to make gold ownership illegal (and an implied gold price of over $5k in today's terms).
Are we at a point where the market's own voluntary establishment of a gold standard, or an alternative currency, is sufficient to see the "now" chart take the next decisive move in the ratio lower? And ignore the "stability" of Europe - it is all a scam predicated upon a systematic farce, and the very same conditions that caused spreads to blow out in May and June are still there - the only thing that has changed is how Europe deals with the symptoms: just like our Fed, the solution to all manifest symptoms is for them to be drowned in ever more money. Yet neither Europe, nor the US, has still addressed the actual cancer at the heart of the system which makes symptomatic breakouts all the more prevalent. And as the market once again realizes this simple truth, look for the SPX-gold relationship to take out recent lows. The only question as far as we are concerned: will Obama "learn" from the past, and do to gold what FDR did?
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| Posted: 27 Jul 2010 09:47 AM PDT Gold futures slip on technical selling The COMEX December gold futures contract closed down $25.20 Tuesday at $1161.80, trading between $1160.80 and $1190.20 July 27, p.m. excerpts: see full news, 24-hr newswire…
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| This China growth story has nothing to do with gold, energy, or commodities Posted: 27 Jul 2010 09:28 AM PDT From Bloomberg: Weight Watchers International Inc., the world’s largest chain of diet centers, said it is adapting its point-counting system to fit China and take advantage of a growing middle-class population. Increasing affluence and a lack of nutritional education make the country ripe for expansion of the New York-based company’s weight-loss programs, according to Chief Executive Officer David Kirchhoff, 43. The company opened its first Chinese outlet in Shanghai in 2008 and now has five centers there. “The speed of how quickly the middle class is emerging lends itself to our program,” Kirchhoff said yesterday in a telephone interview. China’s middle class may grow to 46.2 percent of households by 2020, from 31.7 percent this year, London-based research firm Euromonitor International said. China will be “a brand new business,” Kirchhoff said. Weight Watchers needs the boost after first-quarter profit fell to its lowest level since 2004. The company has had to negotiate cultural differences in its effort to gain brand recognition and respect among Chinese consumers, Kirchhoff said. Weight Watchers assigns points to foods based on calories, fat and fiber, and a client gets a certain amount of points per day. Trays of Food “A typical experience for people when they eat out in China is the big spinning tray with all the different dishes around it,” he said. “You might have two spoonfuls of this, three spoonfuls of that. It’s a different process to keep track of how much you’re eating. We had to reinvent the program to fit their lives.” The Chinese version of the program incorporates images to show how big servings should be, Kirchhoff said. Researchers spent time in restaurant kitchens throughout China to compile a list of standard ingredients in many traditional dishes to give approximate point values, he said. “Nutritional information has not been available for Chinese consumers, so awareness about what’s in certain foods is quite a bit lower,” said Kirchhoff. The company spent more than a year developing a Chinese-food database. The China business is a joint venture with Paris-based Groupe Danone SA, 51 percent-owned by the weight-loss company. Weight Watchers rose 13 cents to $27.13 at 1:54 p.m. in New York Stock Exchange composite trading. The shares had fallen 7.4 percent this year through yesterday. The company is scheduled to report second-quarter earnings Aug. 5. Weight Watchers hasn’t released revenue or profit from its China operations. North America accounted for about 65 percent of the company’s sales of $1.4 billion in 2009. The U.K. and Europe made up about 31 percent. “We’re in the process of identifying the right business model that will allow us to profit in China,” said Kirchhoff. “Without knowing exactly what that is, it would be an arbitrary exercise to forecast profit at this time.” To contact the reporter on this story: Alex Sherman in New York asherman6@bloomberg.net. More on China: Why China isn't buying IMF gold... Why China wants gold to plunge to $800 Frank Curzio: This tiny stock could solve China's biggest problem
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Gold fell to the lowest price in three months as a rally in global equities eroded demand for the precious metal as an alternative investment. Stocks in Asia and Europe rose, while the fourth straight gain by the Dow Jones Industrial Average was enough to erase the index's loss for the year. December gold fell 2.1%, still up 6% on the year. Losses accelerated after the price fell below the 100-day moving average around $1,181, a key area of resistance…| You are subscribed to email updates from Gold World News Flash To stop receiving these emails, you may unsubscribe now. | Email delivery powered by Google |
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