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• If Gold Production Rises, Can Prices Follow?
• How Likely Is $1500 Gold?
• We are running out of physical silver folks.
• Ignore Your Financial Advisor: It's Time to Own Gold Not Stocks – Here's Why
• Goldrunner: Gold and the PM Stocks Will Make 2011 A Happy New Year For All!
• What Do Rising Interest Rates Mean for the Price of Gold?
• McGuire: $10,000 Gold is a Distinct Possibility! Here's Why
• Holding Physical Gold Is Absolutely Critical To Your Financial Survival!
• 2 Standout Companies Among Junior Rare Earth Miners
• Gold / Silver ratio forecasting price weakness ?
• Gas & Oil Charge Ahead While Gold Wavers
• Why Germany’s Rescue Package Policies Will Benefit Gold
• Bullion Confiscation: Paranoia, or Justified Fear?
• Why Rising Rates are Super-Bullish for Gold and Silver
• update 04/01/2011
• Gold and Silvers Daily Review for January 4th, 2011
• One Last Look at State and Local Finances
• The unbelievable price gold could reach this year
• Why the breathtaking rally in coal could be going much, much higher
• Is zillionaire Slim taking a position in silver?
• Hyperinflation will drive gold to unthinkable heights
• Eruope In Focus In New Year
• The U.S. Mint Reports Another 1,696,000 Silver Eagles Sold
• Gold Rises 29.8% in 2010 to End a Stellar Decade
• Trading Comments, 4 January 2011 (posted 10h15 CET):
• Gold and Guns
• The Great Flood and Coal
• COT Update to Graphs
• The Plight of the Baby Boomers
• Drama In The Silver Market
• State Debt Crisis Approaching
• Economic War
• Is The World's Richest Man, Carlos Slim, Entering The Silver Fray?
• Gold and the PM Stocks Will Make 2011 A Happy New Year For All!
• Good reasons to sell...
• Gold Carves Out an Ascending Triangle
• Metals Fall Hard from Record Highs as Stock Markets Rise
• The Outlook for 2011
• Another Look at Silver Stocks
• The Nomadic Nature of Money
• Gold and silver withstand another attack/silver rises above 31.00 dollars.
• Gold Seeker Closing Report: Gold and Silver Close At New Highs
• COT Silver Report - January 3, 2011
• update 03/01/2011
• Researchers create pseudo Palladium alloy.. time to sell?
• Silver Leads the Way
• Silver's Artificial Price Fixing Regime Has Ended

If Gold Production Rises, Can Prices Follow? Posted: 04 Jan 2011 06:13 AM PST Market Blog submits: By David Berman The argument in favor of rising gold prices – the U.S. is printing money like you wouldn’t believe! – was heard throughout most of 2010, when gold reached its nominal high of more than $1,400 (U.S.) an ounce. But the supply-and-demand picture continues to suggest that gold’s luster is fading. Complete Story »

How Likely Is $1500 Gold? Posted: 04 Jan 2011 06:06 AM PST Hard Assets Investor submits: By Julian Murdoch Last week I looked at how the white metals (that is, silver, platinum and palladium) had been performing. Now it’s time to turn our attention to gold, and what 2011 will bring. Complete Story »

We are running out of physical silver folks. Posted: 04 Jan 2011 05:49 AM PST We are running out of physical silver folks.

Ignore Your Financial Advisor: It's Time to Own Gold Not Stocks – Here's Why Posted: 04 Jan 2011 05:16 AM PST I know quite a few people who are still invested in the stock market – if not up to their necks, then certainly for a lot of money. They smile knowingly and say, "Do you know a better place to have made money in 2010?" The answer is, "Yes – gold", which is where I've been. Nevertheless, they do have a point: had I held less cash – and added Stocks to my portfolio – last year would have been even better than it was for my... [investment portfolio. That being said, I'm staying] out of the stock market until the FTSE reaches 3000 [and/or the Dow reaches 6,000 and/or so the S&P 500 reaches 600!] Words: 975

Goldrunner: Gold and the PM Stocks Will Make 2011 A Happy New Year For All! Posted: 04 Jan 2011 05:16 AM PST It is fascinating to be living during the greatest Precious Metals (PM) Bull Market in history – and to be entering its Seasonal Strength - and I look forward to keeping you informed on a regular basis throughout 2011 as it unfolds. Words: 1119

What Do Rising Interest Rates Mean for the Price of Gold? Posted: 04 Jan 2011 05:16 AM PST The return of the Euro debt contagion and drop in the bond markets across the world is pushing interest rates higher and it has investors concerned and rightly so - and nowhere has the concern been more prominent than in gold. [Let me explain.] Words: 759

McGuire: $10,000 Gold is a Distinct Possibility! Here's Why Posted: 04 Jan 2011 05:16 AM PST In stormy times, investors look for something solid to hang onto—something like gold. The World Bank president himself, Robert Zoellick, suggested in November that the world's economies could use the old reliable metal to help stabilize their currencies. For these and many other reasons gold has nowhere to go but up. [Let me explain.] Words: 1465

Holding Physical Gold Is Absolutely Critical To Your Financial Survival! Posted: 04 Jan 2011 05:16 AM PST We now live in a world where governments print worthless pieces of paper to buy other worthless pieces of paper that combined with worthless derivatives, finance assets whose values are totally dependent on all these worthless debt instruments. Thus most of these assets are also worth-less and the world financial system is a house of cards where each instrument's false value is artificially supported by another instrument's false value. The fuse of the world financial market time bomb has been lit. There is no longer a question of IF it will happen but only WHEN and HOW. Words: 1650

2 Standout Companies Among Junior Rare Earth Miners Posted: 04 Jan 2011 04:56 AM PST Long but very informative read on the Rare Earth Jr's.. Have some rather large positions myself on two of these. 2 Standout Companies Among Junior Rare Earth Miners

Gold / Silver ratio forecasting price weakness ? Posted: 04 Jan 2011 04:22 AM PST Perth Mint

Gas & Oil Charge Ahead While Gold Wavers Posted: 04 Jan 2011 04:19 AM PST

Why Germany’s Rescue Package Policies Will Benefit Gold Posted: 04 Jan 2011 03:50 AM PST

Bullion Confiscation: Paranoia, or Justified Fear? Posted: 04 Jan 2011 03:48 AM PST A question which I am regularly asked by readers (especially U.S. readers) is whether I believe that government(s) would once again confiscate the gold held by individuals. The question is a reasonable one, given the U.S.'s prior history of "gold confiscation" during a time of deep economic strife. "Executive Order 6102", issued by the Roosevelt administration on April 5, 1933 commanded U.S. citizens to turn over all of their bullion holdings, with a few limited exceptions. The official exchange rate for all gold confiscated was $20.67 US, which was the official, fixed price for gold at that time.

Why Rising Rates are Super-Bullish for Gold and Silver Posted: 04 Jan 2011 03:47 AM PST

update 04/01/2011 Posted: 04 Jan 2011 02:35 AM PST Well, an intraday move above resistance isn't good enough.  The model works with closing prices so back to reality: we're still in the triangle.  With today's levels were caught between 1415 and 1360. Today, a special thanks goes to Frederick from the US.  700 USD to go! This posting includes an audio/video/photo media file: Download Now

Gold and Silvers Daily Review for January 4th, 2011 Posted: 04 Jan 2011 02:00 AM PST Gold Forecaster

One Last Look at State and Local Finances Posted: 04 Jan 2011 01:54 AM PST Dollar Collapse

The unbelievable price gold could reach this year Posted: 03 Jan 2011 11:42 PM PST From Jeff Clark, editor of Casey's BIG GOLD, in Casey's Daily Dispatch: After stellar years for both gold and silver, what prices will precious metals hit in 2011? Here's an analysis based strictly on their price behavior in the current bull market. First, take a look at the annual percentage gains that gold has registered since 2001 (based on London PM Fix closings): Excluding 2001, the average gain is 20.4%. Tossing out the additional weak years of '04 and '08, the average advance is 24.8%. So we can make some projections based on what it's done over the past 10 years. From the 12-31-10 closing price of $1,421.60, if gold matched… ... The average rise this decade, the price would hit $1,711.60. ... The average rise excluding the three weak years = $1,774.15. ... Last year's gain = $1,858.03. ... The largest advance to date (2007) = $1,875.09. But what if global economic circumstances continue to deteriorate? What if worldwide price inflation kicks in? And what if government efforts at currency debasement get more abusive? If Doug Casey is right, a mania in all things gold lies ahead – what if that begins in 2011? Here's what price levels could be reached based on the following percentage gains. 35% = $1,919.16 40% = $1,990.24 45% = $2,061.32 50% = $2,132.40 1979's gain of 125.7% = $3,208.55 It thus seems reasonable to expect gold to surpass $1,800 this year, as well as reach a potentially higher level since the factors pushing on the price could become more pronounced. Here's a look at silver... As you can see, silver had its biggest advance in 2010. The average of the decade, again excluding 2001, was 27.5%. And also tossing out the '08 decline, the average gain is 34.3%. So from the 12-31-10 closing price of $30.91, if silver matched... ... The average rise this decade, the price would hit $39.41 ... The average gain excluding 2008 = $41.51 ... Last year's advance = $56.22 ... The 1979 gain of 267.5% = $113.59 So $50 silver seems perfectly attainable this year. And that's without monetary conditions worsening. It's titillating to ponder these advances for gold and silver, especially when you consider we might be getting close to the mania. And if we are, that should do wonderful things to our gold and silver stocks, too. I would add one caution... The odds are high that there will be a significant correction before gold begins its march to these price levels. In every year but two ('02 and '06), gold fell below its prior-year close before heading higher. And here's something to watch for: in every year but one ('08), those lows occurred by May. In other words, a buying opportunity may be dead ahead. And if you buy on the next correction, your gains on the year could be higher than the annual advance. Crux Note: Each month in BIG GOLD, Jeff Clark brings readers the latest "need-to-know" news on gold and silver, as well as some of the best medium- to large-cap mining companies in the industry. With the gold mania possibly just around the corner, there’s no better time to try BIG GOLD risk-free for three months, with a full money-back guarantee. Click here to learn more. More on gold: This chart says the gold mania is coming The No. 1 reason you must own gold and silver now Man denied access to his gold at Swiss bank: "The gold was not there"

Why the breathtaking rally in coal could be going much, much higher Posted: 03 Jan 2011 11:41 PM PST From Mineweb: U.S. coal miner shares rallied on Monday as massive floods in Australia disrupted a big chunk of the world's metallurgical coal supply, driving up prices and causing Asian importers to hunt for alternatives. Floods in northeast Australia have brought most mining operations to a halt in Queensland, which produces the bulk of Australia's steelmaking coal. Australia is the largest exporter of the grade, exporting about 125 million tonnes, with the United States a distant second at 33 million tonnes in 2009. Steelmakers globally are feeling the effect and are bidding up prices for U.S. exports of high-grade coal that is a key ingredient for producing steel. U.S. metallurgical coal is among the world's best, analysts said. "Japanese, Korean, and Taiwanese mills have started inquiring about near-term U.S. coal at... Read full article... More on coal: Why you should invest in the new "black gold" These commodity stocks could be in for a BIG move The stars continue to align for dramatically higher coal prices

Is zillionaire Slim taking a position in silver? Posted: 03 Jan 2011 11:00 PM PST GATA

Hyperinflation will drive gold to unthinkable heights Posted: 03 Jan 2011 10:02 PM PST

Eruope In Focus In New Year Posted: 03 Jan 2011 08:54 PM PST All Eyes Are On Europe As Debts Come Home With A Vengeance. "Self-righteous Germany must accept a Euro-debt union or leave EMU." "If Germany and its hard-money allies genuinely wish to save the Euro – which is open to doubt – they hould stop posturing, face-up to the grim imperative of at Transfer-union, and desist immediately from imposing their ruinous and reactionary policies of debt deflation on southern Europe and Ireland." We normally agree with this writer but this time we say he is off base. Germany needs to save themselves and will have to sacrifice their neighboring nations and throw them under the bus. Policies he refers to are from misguided Euro-Central Bankers." -Editor "One can sympathize with the German people. Their leaders in the 1990s told them "famine in Bavaria" was more likely than the preposterous suggestion that Germany might have to bail out countries as a result of EMU. But events have moved on and, rather than striking tones of Calvinist righteousness, the Teutonic bloc might do well to acknowledge equal responsibility for the capital flows, trade imbalances, and cumulative errors that caused the EMU debacle, and therefore accept that the honorable course is to meet the struggling south halfway." "Readers may have a better menu, but here is my own rough sheet: a debt union, funded by Eurobonds; a calibrated jubilee on traditional IMF lines for Ireland, Greece, Portugal, and if necessary Spain, to occur in parallel with austerity cuts; and a monetary blitz by the European Central Bank to prevent the victims tipping into core deflation, even this stokes inflation of % or 5% in northern Europe." (Editor: We say this is an impossible dream). "It beggars belief that the ECB should continue to allow the contraction of the M3 money supply and credit to private firms. EU leaders have already shown their willingness to ram through treaty changes without full ratification under Article 48 of the Lisbon Treaty, they (might) bring ECB ideologues to heel with a new mandate." "If the Teutonic bloc cannot accept such a political revolution, it should withdraw from monetary  union before inflicting any more damage to the social fabric of southern Europe, or at least allow 30% appreciation within EMU by creating a Doppelmark." Editor: We say they will withdraw perhaps in 2011). "An internal adjustment could be done overnight, if necessary with temporary capital controls. The residual Euro states would undergo a relatively seamless devaluation to levels that reflect the reality of current account deficits and labor productivity, yet their existing contracts in Euros would be upheld. Creditor states – and Britain – would have to stand ready to recapitalize their own banks at great cost to fortify them against the systemic shock of haircuts on the entire debt stock of peripheral EMU. True burden-sharing at last." "Needless to say, EU leaders failed to grasp the nettle at last week's summit, despite a pre-insurrectional mood in Athens where one former minister was bludgeoned by anarchists outside parliament, and in Rome where a police officer was almost lynched in political violence that left 80 people injured." "Not even the warning shot of Spain's debt auction on Thursday seemed to break the impasse. Chancellor Angela Merkel must know that the Spanish state, juntas, and banks cannot refinance €300bn (£254bn) next year at a bearable cost if the Tesoro is already paying a decade-high of 5.45% to sell 10-year bonds, yet she continues to play for time she does not have. "Behind the curve", was the understated rebuke by IMF chief Dominique Strauss-Kahn." (Ed:: Merkle is stuck in a political delimma and is doing the best she can. The IMF will soon become irrelevant along with ECU bankers and Euroland experiment in general. Merkle is not playing for time. She's trying to devise an exit strategy from Euroland). "His own IMF team has indicated the policy that it is being told to enforce as junior partner of the EU rescues. It warned of "adverse fiscal and financial feedback loops" in Ireland, in its latest report." "A prolonged period of deep recession (Ed: We say depression is now!) could weaken loan repayment capacity of households and businesses and increase bank losses beyond current projections, leading the economy into a negative spiral. Wage and price deflation – coupled with contraction in activity – could have a powerful negative effect on debt dynamics,' it said. 'There are significant risks that could affect Ireland's capacity to repay the Fund,' it said. Indeed, so why is the IMF board giving a green light to this obscurantism?" "The EU torture policy of thrusting yet more debt on crippled states already caught in a debt trap – and then forcing them even deeper into downward spiral with a 1930s policy of wage cuts and "internal devaluation" – is an intellectual disgrace. Let it never be forgotten that Ireland and Spain are struggling because EMU caused a collapse in real interest rates to -1% or -2%, setting-off an uncontrollable boom. This is what the Gold Standard did to Germany in the late 1920s, when US banks funded a German credit bubble. That ended with the destruction of German democracy." "Klaus Regling, the EU's chief bail-out officer, said Euroskeptics will "eat their words again" as the policy is vindicated. Excuse us, Dr. Regling, but we have not yet eaten any words on the fundamental critique of EMU. Perhaps it is unkind to point out that Dr. Regling was the European Commission's director-general of economic affairs from 2001 to 2008, more or less spanning the incubation period of the catastrophe now at hand. To borrow the immortal line from Watergate: What did you know and when did you know it?" -Ambrose Evans-Pritchard, International Business Editor 12-19-10 Daily Telegraph In our view, the sooner Germany bails out of the failed Euroland experiment the better for Germany. Actually the better for her neighbors too as thye will be forced to bite the bullet and get real about austerity and debts. The debts must be written-off and written down. The bankers lose but they made the messes. So be it. Bankers Threaten To Quit: "Forty-eight percent of workers in the financial services industry consider changing jobs if annual bonuses disappoint, said recruiter  Astbury Marsden , which advises companies in Europe and Asia.  Trader Tracks says fine; let 'em all quit. They made the problems so good riddance. Read Article This posting includes an audio/video/photo media file: Download Now

The U.S. Mint Reports Another 1,696,000 Silver Eagles Sold Posted: 03 Jan 2011 08:39 PM PST 'Da Boyz' are back in town. Is the world's richest man getting into silver? Gold rises 29.8% in 2010 to end a stellar decade: James Turk. Consumer bankruptcies hit 5-year high in 2010. ¤ Yesterday in Gold and Silver After a brief sell-off on Tuesday morning in Far East trading, the gold price recovered all of its losses, plus a bit more, by the time that Comex trading began in New York at 8:20 a.m. yesterday morning.  The spike high of the day [$1,424.80 spot] was squashed the moment that New York opened.  Both attempts by gold to break higher got sold off... and once trading in New York was through for the day...and electronic trading began...the U.S. bullion banks took the price down about five bucks.  Gold basically closed on its low price of the day, which was $1,412.00 spot. Silver's price path was virtually identical to gold's... except that the U.S. bullion bank-inspired sell-off in electronic trading after the New York session was particularly vicious... although there wasn't much in the way of volume associated with it.  Silver's high price of the day was at the New York open...and printed $31.22 spot.  The sell-off [probably courtesy of JPMorgan] in electronic trading took the price down over 60 cents, with the low of the day coming around 3:20 p.m. Eastern time at $30.47 spot.  As always, the silver price was more 'volatile' than the gold price. The dollar started trading below the 79 cent mark on Monday morning... but didn't stay there long... and rose about 55 basis points over the next nine hours.  But once that top was in around 3:00 a.m. Eastern, the dollar rolled over, but 'strong hands' showed up a couple of times to ensure that it didn't fall back below the 79 cent mark.  In my opinion, the dollar was not a factor in yesterday's precious metals price action.    The gold stocks pretty much followed the gold price...and the HUI finished down 1.15% on the day...but closed up from its absolute low.    The CME Delivery Report showed little action on Monday, as most of January's deliveries were posted last Friday.  The report showed that only 13 gold and 10 silver contracts were posted for delivery today and tomorrow. There were no changes reported by either GLD or SLV. But over at Switzerland's Zürcher Kantonalbank for the week that was, they reported receiving 32,074 ounces of gold, along with 346,172 ounces of silver.  I thank Carl Loeb for these numbers.  The U.S. Mint had a sales report yesterday.  However, it's blatantly obvious that these sales actually occurred in December sometime... but they didn't want to add them to the 2010 totals.  December is normally the biggest sales month of the year...and the reason it wasn't in 2010 was because the mint didn't report the sales in a timely manner.  That was deliberate. Anyway, they reported selling 9,000 ounces of gold in their gold eagle program, along with 1,696,000 silver eagles. Over at the Comex-approved depositories, they reported that a further 301,597 troy ounces of silver were withdrawn from their inventories on December 31st.  They finished the 2010 year with 104,547,631 ounces of silver on their books...the lowest level in more than four years. The Commitment of Traders report came out at the usual time yesterday...and I must admit that I was disappointed...but, after a long chat with Ted Butler, I now understand what happened. First of all, the Commercial net short position in silver increased by 3,834 contracts.  A lot of the decline was the '9 or more' traders [the Raptors, as Ted calls them] selling long positions for a profit... but there was some selling by the 'big 4' shorts... almost all of which would have been JPMorgan. In gold, the Commercial net short position rose 7,962 contracts. Ted figures that JPMorgan et al were forced to sell on last Tuesday's [December 28th] big run-up in the price of silver... or the silver price would have gone ballistic on them.  They became, rather reluctantly, the sellers of last resort [or a not-for-profit seller, as I sometimes call them]... as there was no free-market seller prepared to go short against all the longs that were pouring into the market on that day. If you remember, last Tuesday's open interest numbers were sky high in both metals... so Ted and I thought the worst...that JPMorgan was up to its old tricks.  The next day, Ted and Carl Loeb thought it might have something to do with in-the-money options holders converting to futures... as Tuesday was options expiry day.  So that's where the matter lay...as we all waited for Monday's COT report. Well, as the COT report showed, it was the bullion banks up to their old tricks.  As Ted pointed out, this isn't the first time during the last several months that JPMorgan has been forced to ride to the rescue as the silver price was about to go supernova.  Ted said that the situation reeked of desperate men doing desperate deeds in order to save themselves...and others. Here's Ted's "Days of World Production To Cover" graph that's courtesy of Nick Laird over at sharelynx.com.    Click here to enlarge. In a note to clients in the wee hours of this morning, silver analyst Ted Butler, had the following to say about JPMorgan going short the silver market again last Tuesday... "What I do know is that I am sick and tired of this continued silver manipulation, even though silver seems to be in the process of shaking off the long-term price suppression.  There's no question silver is going higher, but the short crooks may be planning another self-created sell-off first.  The crooked commercial shorts appear to be staging a strategic retreat, but I remind you and the regulators that this is still very much a crime in progress.  Silver is a great buy, with or without a phony sell-off, but it is infuriating that these commercial crooks are still at it after so many years." Before I get into my stories for today, I thought that Nick Laird's 'Silver Sentiment Index' graph might be worth looking at as well.  As you can see, we're within striking distance of the old highs...but the smaller junior silver producers are vastly outperforming these seven large silver companies.    Click here to enlarge. Sponsor Advertisement Tiny Company Discovers Serbian King's "Hidden" $884 Million Goldmine New presentation reveals how you could make 2,932% gains from one tiny company sitting on an historic $884 million goldmine. Get your share of the King's treasure in the next 24 hours – right here. ¤ Critical Reads Subscribe CNBC Interview with Retail/Commercial Real Estate Expert Howard Davidowitz I'm glad that I had a column yesterday, as I have another big batch of stories for you today. The first one is a piece I ran yesterday where the imbedded video wouldn't play.  This was pointed out to me by reader Scott Pluschau.  It was that 12 minute and 30 second CNBC Interview with Retail/Commercial Real Estate Expert Howard Davidowitz.  The zerohedge.com story is linked here...but the now-working video from that story, is posted over at youtube.com... and is linked here.  And, as I said yesterday, the video is more than worth your time, as Howard paints a really ugly picture. View full GSD edition Consumer bankruptcies hit 5-year high in 2010 The next story is from 'David in California'.  It's an item posted over at news.yahoo.com that bears the headline "Consumer bankruptcies hit 5-year high in 2010".  Roughly 1.53 million consumer bankruptcy petitions were filed in 2010, up 9 percent from 1.41 million in 2009, according to the American Bankruptcy Institute, citing data from the National Bankruptcy Research Center. This item, plus the story above, plus the fact that 13% of U.S. citizens are on food stamps means that the economic recovery is a myth... and always has been.  The link is here. View full GSD edition BofA Scrambling Amid WikiLeaks Threat, Report Says Washington state reader S.A. sent along a Reuters story yesterday evening that was posted over at foxnews.com.  The headline reads "BofA Scrambling Amid WikiLeaks Threat, Report Says".  A team of up to 20 Bank of America officials, led by the chief risk officer, Bruce Thompson, have been reviewing thousands of documents amid a threat that it may be a target of WikiLeaks, The New York Times reported on Sunday.  The link is here. View full GSD edition Forget Pep Talks; Governors Warn of Tough Times Here's another unhappy story out of yesterday's King Report. It's from The Wall Street Journal... and is headlined "Forget Pep Talks; Governors Warn of Tough Times"... New governors in 26 U.S. states are starting to take office with somber warnings to constituents of more tough times amid revenue shortfalls and a weak job market.  The link is here. View full GSD edition European debt markets 'face second credit crisis' In overseas news, here's a story from Sunday's edition of The Telegraph.  The headline reads European debt markets 'face second credit crisis'.  Banks alone must refinance about €400bn [£343bn] of debt in the first half of the year, but add in the more than €500bn European governments must replace over the same period, as well as further hundreds of billions of euros of mortgage-backed debt maturing and there is the potential for chaos in the credit markets.  The link is here. View full GSD edition Iran, India resolve oil trade dispute Here's another story from reader 'David in California'.  This piece was posted over at the Iranian website payvand.com last Friday.  The headline reads "Iran, India resolve oil trade dispute".  They did this by deciding that Indian payments for Iranian oil would not longer be made in U.S. dollars.  It's not an overly long piece...and the link is here. View full GSD edition Chile opts for record intervention to stem peso rise Here's a Reuters story posted over at The Guardian in London.  Chile's central bank said on Monday it will buy $12 billion in U.S. currency in its biggest-ever forex intervention aimed at taming the soaring peso, which is near 3-year highs and hammering local exporters.  The bank joins Brazil, Columbia and Venezuela in trying to tame local currencies.  The headline reads "Chile opts for record intervention to stem peso rise"... and the link is here. View full GSD edition

Gold Rises 29.8% in 2010 to End a Stellar Decade Posted: 03 Jan 2011 08:39 PM PST Link:  Gold Rises 29.8% in 2010 to End a Stellar Decade Image:  Lastly today, is this GATA release that has another James Turk commentary imbedded in it.  His essay summarizes the performance of gold and silver in 2010, reporting that gold did spectacularly well, rising substantially in all currencies except the Australian dollar, and silver did even better. As he expects monetary debasement to remain central bank policy around the world, Turk expects 2011 to be another great year for the metals. read more

Trading Comments, 4 January 2011 (posted 10h15 CET): Posted: 03 Jan 2011 07:15 PM PST After returning from a 3-day weekend, London sold the precious metals on the open this morning. Gold and silver are presently testing support. More testing is possible, but the long-term

Gold and Guns Posted: 03 Jan 2011 05:00 PM PST

The Great Flood and Coal Posted: 03 Jan 2011 03:51 PM PST --Before the reckoning of 2011 kicks off, we want to extend our best wishes to all our readers in Queensland affected by the flooding. The pictures on the TV probably don't do justice to the extent of the damage and disruption to real people's lives. We'll keep you in our thoughts and prayers tonight. --As an economic issue, the flooding has already idled production in 75% of Queensland's coal fields, according to Agence France Presse. The Bowen Basin - one of the main coal zones in the state - is right in the middle of the flooding. BHP Billiton, Rio Tinto, and other coal producers have already declared force majeure. --Coal, as you may know, is one of Australia's twin commodity titans. Iron ore is the other. Australia exported $139.1 billion worth of energy and mineral commodities last year. $71 billion of that total-or 51% of all export earnings came from coal and iron ore. Thermal coal for use in generating electric power churned out $11 billion. Metallurgical coal generated $24.5 billion. And iron ore generated $34.5 billion. --The Australian Bureau of Agricultural and Resource Economics (ABARE) reckons that mineral and energy exports will grow in value by another 28% in 2011. ABARE forecasts a 46.5% increase in iron ore prices, a 34.1% increase in the value of met coal exports, and a 32.2% increase in the value of thermal coal exports. See the table below for details. Higher export values on smaller volumes Click here to enlarge Source: ABARE --What's telling about the table is that the 34% change in the value of met coal exports is forecast to come from just a 1.9% increase in the volume of production. The only way you get an increase that big is with higher prices. And ironically, any serious disruption in coal production from Queensland could drive prices higher. But obviously, if export volumes fall, then Aussie producers would capture less of the windfall from higher prices (at least in the spot market). --Incidentally, you can see that ABARE is also forecasting a big increase in the volume and value of energy exports, especially oil and uranium. Oil futures hit $91.55 overnight, which confirms a bullish forecast. And that brings us to the larger issue that confronts you as an investor for 2011: will it be pretty much like 2010? --That is, will it be a good year to buy precious metals and tangible assets? And will those assets outperform stocks? The question is worth asking, if only to shake up your preconceived ideas about what's going on in the market. We used the break to try and look at our rather entrenched and bearish position on the market and examine it from a different perspective. Does it hold up? --Well the S&P 500 was up 13% in 2010 and is up 39% since late 2008. Of course that is in U.S. dollar terms and reflects a U.S. market that has become a plaything for market manipulators (central banks and primary dealers) and high frequency traders. By comparison, the ASX/200 finished up Friday 2.6% lower than it started. --Naturally, today's Australian Financial Review, not a single of the ten analysts surveyed by the paper predicted that the market would go lower in 2011. The average forecast is for a 14% gain this year. The most bullish forecast (from RBS) is for a 20% gain. The least bullish forecast was for a 5% gain. --Bears, apparently, were not surveyed. But then, the securities industry is in the business of selling securities. And you probably don't sell a lot of securities by telling people that the securities prices are going lower. So where does that leave us? --Well, copper went up 33% last year (as our resource guru Dr. Alex Cowie predicted). Mine supply shortages and demand growth have conspired to send copper futures to a record $4.45/lb in COMEX trading. Barclay's estimates there will be an 800,000 tonne shortfall in copper production this year. --Meanwhile, China consumes one-third of the world's copper. And during yesterday's U.S. trading, it was reported that U.S. manufacturing expanded at the fastest pace in seven months. All these signs can be read bullishly. --And yet another industrial metal - sliver - is also making new highs. Silver made a 30-year high at $31.08 in New York. In addition to being money, silver is used in a lot of modern technology. You could say that along with copper, silver is giving a vote of confidence to the "recovery in 2011" theme. This would be generally bullish for gold, oil, and emerging markets. --And maybe that's the way it will be. Or maybe not. Nobody knows. But we'll keep trying to figure out what's really going on. --In the meantime, let's not forget that the best cure of high prices is...higher prices. At what point do rising oil and copper prices begin to destroy demand for them? The key will be watching producer price indexes. As those rise, manufacturers will have to pass on rising commodity costs to consumers. --You've already seen how rising food and fuel prices can be politically destabilising in emerging markets. What you may see next is that rising prices for other members of the commodity complex may destroy the hoped-for recovery in 2011. But like we said, no one knows. Tomorrow, is it wise to buy something that's been rising in price for ten years? Stay tuned... Dan Denning For The Daily Reckoning Australia Similar Posts: ABARE Explains How Much Australia Can Make from Selling Silver, Iron Ore and Coal Chinese Steel Price to Rise in Wake of Coal and Iron Price Hike The Future of the Australian Resource Market, Two Ways the Boom Could End BHP Billiton (ASX: BHP) to Report Second Half Results Today Uranium: A Carbon-friendly Substitute for Coal

COT Update to Graphs Posted: 03 Jan 2011 03:41 PM PST HOUSTON – The first thing we need to remember when looking at the COT data which was just released by the Commodities Futures Trading Commission Monday, January 3, is that it is the last report for 2010, not the first report for 2011. This COT data is for the second trading day after Christmas, and it includes the three trading days prior to Christmas, a lighter than normal liquidity period when some large fraction of the "normal" traders were taking a holiday. ...

The Plight of the Baby Boomers Posted: 03 Jan 2011 03:40 PM PST Okay, so what will 2011 bring? Most likely, it will bring more of 2010. That is, the confusing and contradictory trends of the past year are likely to keep going. On the one hand, the deflationary contraction that began in 2007 will continue shrinking prices and economic growth. The savings rate has climbed to over 5%. Unemployment is still near 10%. And the CPI - if you believe the official numbers - is nearly flat. We may be living through the biggest rush in monetary inflation in US history, but the core inflation numbers haven't moved so little in more than 50 years. On the other hand, the inflationary expansion of the money supply that began in 2009 will go on too. It will bring more bubbles and more speculative pressure on oil and gold. It might also bring a collapse of the US Treasury bond market - if not in 2011, then soon after! Which hand will have the upper hand? Neither. Instead, they will continue jerking the economy this way and that...rewarding some speculators, punishing others...smacking economists...and giving central bankers the middle finger. That's our prediction. Gold will rise. Oil will rise. Emerging markets will rise. The US economy will NOT rise. What? Weren't there encouraging signs of life at the very end of the year? Yes. But there are always signs of life in an economy. The US economy isn't dead. It's just going through a bad patch...like a man whose wife has left him...or a woman who has gained 20 lbs...or a 60-year-old couple that has to downsize. These things take time. "Baby boomers unprepared for retirement," says a headline in the local paper. According to the article, 10,000 boomers will reach age 65 every day for the next 19 years. And few of them have saved enough money. Some were counting on 401(k) plans. But stocks haven't made any progress in the last 10 years. Others were looking to their houses as a source of retirement financing. They were doing fine until 2007. Since then, the value of their houses has been cut by a third. The poor boomers! What are they going to do? We talked to one of these boomers on the way from the airport. "I'm going to work until I drop," he said. (Good plan. If you have a job...) "I bought a little apartment over in Boca Raton," our driver explained after picking us up in Miami. "You know, like everyone else, I've been hurt by this recession. They say it's over. But it doesn't seem over to me. "A couple years ago, people would rent my limo service for a big night out...maybe, twice a week. I'd take them down to Miami. They'd go to a big party...or to a Heat game...and then to a nightclub. They'd pay me for a whole night. It was good money. "But now, I'm lucky if I get one a month. Either people don't have money or they're not spending it. "My wife and I had a big house with a swimming pool...everything. But we also had a big mortgage, $4,500 a month. She didn't want to do it. But we had no choice. I needed to make sure that at least I'd have a roof over my head. So, I bought an apartment in Boca for $27,000. It was $90,000 three years ago. "And I told my wife that we had to cut back. This way, I'll be able to save some money. Then, if we want to, we can always buy a big house again. But right now, I just don't want that burden on my back. I can't afford it." And more thoughts... "Bill, you made it sound like all the developments on the coast of Nicaragua have gone bust," said a friend. "But that's not true. The area is booming." Last week, we stood on a mountain peak near the coast. On the one side were the failures of socialism - cooperative farms with low productivity and severe title issues. On the other were the failures of capitalism - developments on the coast that had gone broke. But our friend is right. Oddly, most of the small developments on the coast did go broke...but the area is still thriving. We visited one development last week. It was well-designed. It was well built. Still, the concrete roads are cracking up. The owners face a big burden - how to maintain the place now that the developer has gone. Another one has been abandoned all together - with weeds growing up in the middle of the un-used roads. Still another is holding on. But the developer faces a financing crisis. He has to raise money to finish the infrastructure. And who will lend against Nicaraguan real estate? Meanwhile, the richest man in the country has begun his own development. He's going to spend $250 million - far more than anyone else has ever even dreamt of spending - in order to build a dream community near San Juan del Sur. He has sold million-dollar lots to his jet-set friends. He's putting in a golf course...an airport...and a marina. Despite the bear market in real estate in the US, prices in Nicaragua have not come down - at least, not as much as you'd expect. And more and more people seem to be discovering the area. The beach in front of our house, for example, was deserted 5 years ago. Two years ago, it might have had two or three bathers on the entire 2- kilometer stretch. But this year, there were 20 surfers on the water at 7AM. And on our morning stroll, we ran into an American who turned out to be a Dear Reader! "What you don't understand," continued our friend, "is that this place has reached a kind of critical mass. There are restaurants opening up. There are tourists coming from all over the world. And the surfers are now reporting surf conditions here on a daily basis. It may be a country run by old communists. It may be corrupt and inefficient. But it's still a very nice place to live. I've looked all over the world. There are no better beaches anywhere. And the weather, too, is about as good as it gets. And compared to most other places, it is still very cheap." *** On our way out of the country, we noticed a curious collection of pictures in the immigration office. There was a picture of the president, Daniel Ortega. There was also a picture of Che Guevara...the hapless Argentine revolutionary. Just beneath him was a picture of the Virgin Mary. "Maybe the Virgin Mary will move above Che after the next elections," said Elizabeth optimistically. Regards, Bill Bonner for The Daily Reckoning Australia Similar Posts: Baby Boomers Face Early Retirement With No Money Saved Baby Boomers Are Ill-Prepared for Retirement Capitalism and Capitalists Baby Boomers Figure They Will Have to Work Longer than Expected Everything Was Looking Up With the Baby Boomers

Drama In The Silver Market Posted: 03 Jan 2011 02:11 PM PST The entrance of Carlos Slim into the market will not alter the strength of a trend that showed signs of accelerating in early 2010. The entrance of big names and money, however, will add to the drama on both sides of the trade as 2012 approaches. Headline: Is the World's Richest Man Getting Into Silver? A source in mergers and acquisitions out of Europe has alerted King World News that Carlos Slim may be looking to enter the silver market in a big way. Gold and silver are in big bull markets and this is attracting the attention of some of the smartest money around the globe. James Turk commented, "If this deal does happen Eric, this is going to make the silver shorts choke." Fresnillo has a current market cap of roughly $19 billion. Source: kingworldnews.com Post Source: Drama In The Silver Market

State Debt Crisis Approaching Posted: 03 Jan 2011 02:01 PM PST I have warned that a debt crisis of a magnitude we have never experienced before is approaching. States and municipalities are going bankrupt along with the Federal government. Economists foolishly applaud sub-3% growth in GDP when it took a $1 trillion budget deficit to produce. There is some serious misunderstanding of the fundamentals of our economy right now, and this is going to create some crazy volatility. States are in horrible shape; suffice it to say that they are going to encounter a major crisis soon. What people don't realize is that states received billions of dollars in aid as part of the American Recovery and Reinvestment Act of 2009. The influx of government money encouraged states to ignore structural debt issues. In fact, expenditures in states grew in 2009 and 2010 while general fund spending was down both years. In other words, states revenues have still not recovered to pre-recession levels, which means states have been relying very heavily on Uncle Sam. States have also increasingly turned to the bond market (up over 20% from 2009) to fund their budget gaps. These are nothing more than delay tactics. In all likelihood there will be cuts in pensions. Citizens may pay lip service to how they want austerity, but when they are faced with proposed reductions in their entitlements, you will see how quickly they change their tune. My best guess is that civil unrest will result with the inevitable entitlement cuts. Think of it this way. Baby Boomers are relying on Social Security, which very conservatively is $10 trillion in deficit. At the same time their government pensions are in danger, Boomers must pay ever-increasing property taxes on their homes, which of course, most Boomers viewed as a savings account. To add insult to injury, the Fed brought interest rates down so low that Boomers can't get a reasonable return on their savings. All I can say is that Boomers as a whole are going to get hit extremely hard by this crisis. Our government is going about this the wrong way- they should not continue to issue interest-bearing debt in a debt crisis. This is just plain nuts. In the real world, it's obvious that anyone whose debt is greater than their income shouldn't be borrowing anymore.  Anyone in this situation who borrowed money at interest to "stimulate" their finances would be laughed at. The borrower is not getting wealthy, the credit card company is. Why our leaders can't make the connection with our government finances is quite surprising. Foreigners hold our debt, meaning interest payments are stimulating their economies. Lowering interest rates doesn't guarantee banks will lend or that people will borrow. During the Great Depression, interest rates fell right with the economy into the abyss. Helicopter Ben is purportedly an expert of the Great Depression, yet he conveniently ignores this fact. Where is the stimulus lower interest rates would bring? Where are the jobs? Is it time we rethought useless theories that are not applicable in the real world? There is no way out of this crisis because states cannot print their way out of this, only the Federal government can. Every potential outcome of this crisis I have considered is bad. For example, if China listened to the U.S. and allowed its currency to rise relative to the dollar, it would effectively decrease the value of their U.S. bond holdings. In other words, a rising RMB risks a sell-off in U.S. Treasuries, as well as other American assets held by the Chinese. Be careful what you wish for. I don't know what else to say except that this is pretty obvious crisis to predict. The government has dug itself into a deep hole, and all the predictions of economists and professionals concerning the effects of stimulus have proven to be dead wrong. The lack of common sense in our country will lead to our downfall. Real estate is still in serious trouble, and this will adversely affect banks and municipalities. The sell-off in the bond market is going to make deflationists look like amateur forecasters very soon, while, of course, increasing the burden of our debt. People are starting to realize what I've always said:  the Fed ultimately has no control over the bond market. The foundations of the debt crisis are already very strong. It is only a matter of time before the debt crisis starts wreaking havoc. Source: State Debt Crisis Approaching

Economic War Posted: 03 Jan 2011 01:00 PM PST Most Americans have no idea what an "economic war" is, and even fewer realize that economic warfare is being waged against the United States right now.  For generations, it has been drummed into our heads that "free trade" is always a good thing and that truly free trade will always benefit both sides in the long run.  None of our universities teach that trade can actually also be used as a brutally effective weapon of warfare and that economic warfare can bring down entire societies.  Nowhere in the mainstream media will you even get a hint that other nations are purposely trying to damage the U.S. economy for their own benefit.  But in a world where a "shooting war" with the United States is virtually unthinkable, those that wish to damage the U.S. must resort to other means to accomplish their goals. The American people need to wake up and stop being so naive.  The truth is that much of the rest of the world absolutely hates our guts.  They resent our dominance and they are tired of us imposing our will on the rest of the globe.  For generations, Americans have been taught to view themselves as "the good guys", but the sad fact of the matter is that most of the rest of the world does not view us as "the good guys" anymore. In fact, there are quite a few nations out there that would actively like to do us harm. So if they can't shoot at us, then how can they harm us? Well, they can try to destroy us financially and economically. Today, major exporting nations around the globe are draining the United States of wealth, they are stealing our industries and they are feeding our national debt addiction. For some of these nations, they may not actively want to destroy our economy, but they sure do want to steal what we have got.  They are more than happy to keep trading with us as long as they keep getting wealthier and their national economic infrastructure continues to get built up.  The fact that their economies are getting stronger at the expense of the U.S. economy is not really a huge concern for nations in this category. However, there are also quite a few nations that do actively wish to do harm to the United States.  If trading with the United States will cause the U.S. to become poorer and to go into more debt, then that is a tool that they can use to reduce the power and influence of the Americans in the world. Is this something that really happens?  Yes.  Do yourself a favor some time and read some economic articles and research papers from the other side of the world.  In some of these countries they are not afraid to openly talk about economic war. So what are some of the goals of economic warfare? Well, when it comes to the United States, the goal is to induce big corporations (or even entire industries) to leave the U.S. and set up shop somewhere else.  The idea is that the economic infrastructure of the United States will decline while the economic infrastructure of the "attacking nation" will be built up.  The jobs and wealth creation that once were a benefit to America will now benefit someone else. Another goal is to transfer wealth from the target country (the United States) to the attacking country.  Each month the United States buys tens of billions of dollars more stuff from the rest of the world than they buy from us.  Each month we send them big chunks of our national wealth and they send us oil and cheap plastic trinkets which we greedily consume.  As this continues month after month after month, the rest of the world is getting richer while the United States is becoming poorer. In a desperate attempt to maintain our standard of living, our federal government, our state governments and even our local governments are going into insane amounts of debt.  Debt is another tool of economic warfare.  As we continue to borrow trillions of dollars from the rest of the world, the ability of the United States to exert power and control over those nations diminishes. The eventual goal of waging economic warfare against the United States is to make us so impoverished and so far in debt that our entire financial system crashes.  If the U.S. experiences a "financial armageddon", it will greatly reduce America's place in the world.  It could ultimately lead to the collapse of the U.S. government.  Other nations (or organizations) that wish to have more power would then be able to fill the void that would be created. So what are the tools of economic warfare? One is currency manipulation.  By keeping national currencies at an artificially low level, major exporting nations make their own exports much more attractive, thus stimulating job growth and wealth creation in their own nations. Another tool of economic war is government subsidization of industries.  Virtually all governments do this to some degree these days, but some take it much farther than others. For example, there are some governments in Asia that will openly pump huge piles of government money into industries that are considered to be of "national interest".  There is simply no way that western industries can compete on an equal footing against that kind of unfair advantage. In the United States, companies face one of the highest overall tax rates in the world, they face mountains of ridiculous regulations and they have to provide health care and retirement benefits for their employees.  But in other areas of the world the government takes care of health care for everyone, regulations are much less strict and corporate tax rates are much lower. Is it any wonder why so many U.S. companies are having such a hard time today? Another weapon of economic warfare is technology theft. U.S. companies spend billions upon billions of dollars developing new technology that gets "stolen" one way or another by many foreign governments. For example, there is one major Asian nation that offers huge tax incentives and kickbacks to big companies to get them to come over and set up shop there.  But these companies are also required to train and hire local workers and they must agree to certain "technology disclosures". Well, after a time the host nation sets us their own "domestic competitors" using the technology that they have acquired from the foreign company.  Then the "domestic competitors" are tremendously subsidized and are given huge advantages that the original foreign company simply cannot compete with.  Eventually the "domestic competitors" become the dominant players in the market. This is happening over and over and over.  Companies are shutting down operations in the United States and are opening up facilities in other nations where the labor is much cheaper, where regulations are not nearly as suffocating and where taxes are much lower.  However, once these other nations learn the technology and are able to set up "domestic competitors", the original companies are learning that maybe it wasn't such a sweet deal they were being offered after all. As the U.S. is being stripped of industry and is being deindustrialized, the American middle class is being absolutely devastated.  Since the year 2000, we have lost 10% of our middle class jobs.  In the year 2000 there were about 72 million middle class jobs in the United States but today there are only about 65 million middle class jobs.  Sadly, the millions of jobs that have been sent overseas are never coming back. Meanwhile, our national wealth is being drained from our bank accounts.  Back in 1985, the U.S. trade deficit with one particular Asian nation was just 6 million dollars for the entire year.  But for this past August alone, the trade deficit with that same nation was over 28 billion (that's billion with a "b") dollars. In other words, the U.S. trade deficit with that one Asian nation in August was more than 4,600 times larger than the U.S. trade deficit with that Asian nation was for the entire year of 1985. So how are we maintaining our high standard of living if we are shipping all of our wealth overseas? Well, what we are doing is going back to all those nations where we have sent our wealth and we are begging them to loan it back to us. Our federal government now owes trillions of dollars to major exporting nations.  Our state governments also owe insane amounts of money to major exporting nations.  We are in debt up to our eyeballs and it gets worse every single year. Meanwhile, our national economic infrastructure is being absolutely ripped to shreds.... *Back in 1970, 25 percent of all jobs in the United States were manufacturing jobs. Today, only 9 percent of the jobs in the United States are manufacturing jobs. *The United States has lost a staggering 32 percent of its manufacturing jobs since the year 2000. *Since 2001, over 42,000 U.S. factories have closed down for good. *As of the end of 2009, less than 12 million Americans worked in manufacturing.  The last time that less than 12 million Americans were employed in manufacturing was in 1941. *Manufacturing employment in the U.S. computer industry was actually lower in 2010 than it was in 1975. The sad truth is that the U.S. is being dominated even in very high-tech industries.  The major exporting nations are becoming rich by creating wealth and we are becoming poor by voraciously consuming wealth. Unfortunately, some of the major exporting nations that we have a massively imbalanced trade relationship with are doing this to us on purpose.  They see our weakness and the are taking advantage of it.  They believe that it is in their own national interests to make the United States weaker. Sadly, a very significant percentage of those that will read this article will not believe it.  Most Americans have been so brainwashed when it comes to trade that they could never even conceive that it could possibly be used as a weapon of economic war. But the truth is that there are even many prominent Americans that openly talk of weakening the U.S. economy and of reducing the standard of living of the U.S. middle class so that we can be more easily merged into the emerging global economic system. It is time to wake up.  The United States is under economic attack. More jobs are going to leave the United States this month.  More factories are going to leave the United States this month.  Tens of billions more dollars of our national wealth is going to be transferred out of the country this month.  Our federal, state and local governments are all going to go into more debt to foreigners this month. Month after month after month this goes on.  It is being done by design. Perhaps when the entire U.S. financial system collapses the American people will finally begin to understand.  The truth is that the greatest threats to our national security are not some impoverished goat herders hiding out in caves in Afghanistan.  Rather, the cold, hard reality of the situation is that our national economic infrastructure is being ripped apart and stolen right in front of our eyes and we have become so dumbed-down that we don't even understand what is happening. If you want to see "the future of America", just tour some of the formerly great industrial centers of the upper Midwest some time.  Ask yourself why "the greatest economy on earth" has so many abandoned factories and boarded-up homes.  There are many decaying communities across America right now that are so depressing that the moment you enter them you get the sense that all of the hope has been sucked right out of them. The U.S. economy is under attack and it is dying.  We are being looted and pillaged from coast to coast.  This is really happening. So what do you think about all of this?  Please feel free to leave a comment with your opinion below....

Is The World's Richest Man, Carlos Slim, Entering The Silver Fray? Posted: 03 Jan 2011 12:47 PM PST ...A source in mergers and acquisitions out of Europe has alerted King World News that Carlos Slim may be looking to enter the silver market in a big way. Gold and silver are in big bull markets and this is attracting the attention of some of the smartest money around the globe. James Turk commented, "If this deal does happen Eric, this is going to make the silver shorts choke." Fresnillo has a current market cap of roughly $19 billion. The European source commented, "This deal has been floating around for a while, but I think this time it is going to happen. It's in his backyard. This is the world's richest man wanting to get into silver." I view this as the only way for the richest man in the world to enter the silver market at this point in terms of any scale, is that your take as well? http://www.zerohedge.com/article/wor...ng-silver-fray

Gold and the PM Stocks Will Make 2011 A Happy New Year For All! Posted: 03 Jan 2011 12:15 PM PST Goldrunner: Gold and the PM Stocks Will Make 2011 A Happy New Year For All! By: Goldrunner with Lorimer Wilson www.munKNEE.com It is fascinating to be living during the greatest PM Bull Market in history – and to be entering its Seasonal Strength as the parabola rushes forward and upward – and I look forward to keeping you informed on a regular basis throughout 2011 as it unfolds. Value vs. Price Over the last several years many have pounded on the table about how the Dow would crash down to 1,000, yet the Crash was a silent one based on "value", not "price."  I think very few understand the concept of "value versus price" and how aggressively printed paper currencies can so distort "price."  The real PM Stock Bull did not start for the PM stocks until after the equivalent of the Deflation Scare for most of the PM stocks and this fact makes me shudder when I hear so many talk about "taking profits."  If the 70′s cycle continues to play out, there still appears to be around 90% of the gains in the PM stock universe going forward that are still sitting on the table.  Taking profits, now, will lead many to "chase price" as we go.  An analogy might be quitting while you are ahead after a few steps in a hundred yard dash. There is no doubt that the only sure insurance against the ravages of aggressive Dollar inflation is to own physical metals.  Will owning PM stocks provide a leveraged insurance in the same way?  Nobody really knows, but Jim Sinclair seems to think so.  It worked in the 70′s Dollar inflation, and I believe it will work again this decade. Insurance Against Hyper-inflation The fractal work I do monitors the degree to which we are still on track versus the 70′s as a measure of whether the leveraged PM stocks are continuing to serve as "insurance", and it can also work as a gauge of whether hyper-inflation is taking place.  I have only seen Weimar Germany mentioned in terms of hyper-inflation yet Weimar Germany might be considered a bit of "black swan" since it faced what it faced in isolation.  Personally, I believe that what would constitute hyper-inflation in the current period would have to be something "more than the inflation of the 70′s" as a base definition.  I have laid out the basis for this in previous editorials.  We should be able to gauge that "defining point" where historical inflation steps up to hyper-inflation by monitoring the fractal work off of the late 70's using the $Gold chart, along  with the Precious Metals surrogate stock chart.  As long as these two charts continue to closely track the late 70′s I don't think "hyper-inflation" will become a reality.  Yet, one never knows what the future will bring. Nevertheless, we need to find imaginative means of evaluating "risk versus reward" and to that end I would like to suggest that everyone make a New Year's Resolution to have a plan to use some portion of PM stock profits gained over the coming months to buy physical Gold and Silver (held in hand) as financial insurance.  Why?  Because even if we can track the price of $Gold and the $HUI through the fractal work to an unforeseen "inflation versus hyper-inflation line", once that line is crossed it might be very difficult to find the physical metal necessary for financial protection. The bottom line is that too many have waited (or will wait) too long to start to see life in terms other than one based on paper derivatives like the US Dollar.  The possibility exists that many might find sudden and severe loss in paper Dollar Derivatives much like the holders of "green stamps" did when the company that offered them folded up. Paper money used to be a derivative of Gold back when it was backed by Gold.  Today, the paper money derivatives float with absolutely no backing of value, whatsoever.  Paper promises don't seem to be worth much in the current environment, witnessed by the parabolic move in Real Money Gold- the historical "anti-promise" of real stable value. As long as the PM stock certificates are backed by ownership in PM mining companies, their production, and/ or Precious Metals Reserves in the ground, PM stock ownership will serve as a leveraged type of insurance against the ravages of currency inflation.  However, if those stock certificates are not held in hand your ownership is still based on a promise from somebody else that you will have access to those stock certificates as insurance against the continuing aggressive paper currency debasement. Jim Sinclair has written extensively about this issue. What To Do Therefore, it is exceedingly important, as we enter what promises to be a most exciting, challenging and financially rewarding New Year of 2011, that we adhere to the principles that my friend, Deadeye, often shares: 1) Have a plan. 2) Know your risk/ reward ratio in everything you do. 3) Choose partners in life who you can trust. 4) Choose partners in life who will promote your intellectual advancement. 5) Know what you love, and love it forever and, above all else….. 6) Know Thyself. I hope you will follow my ongoing fractal analysis articles on $Gold and the $HUI Index throughout this New Year as we sit on the edge of the next sharp advance in the PM Sector – just one more step higher in the continuing parabolic advance of all things Precious Metals- related. A great New Year to all. Goldrunner/Wilson, January 1st, 2011 Goldrunner will soon activate his new website which will include the analysis of the Precious Metals, the analysis of the Precious Metals Stock Indices, and the analysis of individual Precious Metals stocks.  If you wish to be contacted when the site is up and running you can send an email to him to be contacted when the site is functional. Lorimer Wilson is the Editor-in-Chief of both www.munKNEE.com and www.FinancialArticleSummariesToday.com and will soon be publishing a  FREE weekly "Top 100 Stock Market, Asset Ratio & Economic Indicators in Review" so  sign up now to get on the mailing list.

Good reasons to sell... Posted: 03 Jan 2011 10:49 AM PST Trying to clarify "Good reasons to sell", good invest opportunity comes along, large cash emergency shows up, Bernanke and other Bankerscum get religion, what else qualifies? Please play.:rolleyes:

Gold Carves Out an Ascending Triangle Posted: 03 Jan 2011 10:00 AM PST Prices remain in a very rocky uptrend as the metal now has to compete with other assets for speculative capital. Overall, investment interest in gold remains firm.

Metals Fall Hard from Record Highs as Stock Markets Rise Posted: 03 Jan 2011 10:00 AM PST Gold and silver prices both fell as London traders returned to work from the New Year shutdown on Tuesday, dropping 1.3% and 2.2% respectively from yesterday's highs as world stock markets caught up with Wall Street's strong gains.

The Outlook for 2011 Posted: 03 Jan 2011 10:00 AM PST The demand for physical metal will be the major driver of the gold and silver price, and the accumulation of the precious metals will become an increasingly important portfolio strategy.

Another Look at Silver Stocks Posted: 03 Jan 2011 10:00 AM PST For stock investors willing to take on a bit more risk, with the potential to reap huge rewards, silver-mining stocks are the way to go. And this sector has also captured a lot of interest in recent months.

The Nomadic Nature of Money Posted: 03 Jan 2011 09:00 AM PST I was intrigued that a guy named David Thurtell, of Citigroup, surprisingly said, "The liquidity pumped out by central banks means that there is a lot of money sloshing around that needs to find a home." I was so intrigued that I was tempted to use it as the basis for my first report to the new supervisor for this quadrant of the galaxy, Karpus Klegg the Implacable, at his new office at Intergalactic Headquarters after the "palace coup" and interstellar personnel shake-up that I just found out about. However, I did not want to start off a relationship with some guy I never met named Karpus Klegg the Implacable by saying that people on this planet believe that money can find a home, as it sounds so stupid. After a little checking, I learned that I just needed to say that the people on this planet had evolved to the point where they seek pleasure all the time, and just send him some porno films of earthlings, which he will like better than anything else I could send him. So, with that feather in my cap, I turn my attention to denizens of this planet, singling out for Mr. Thurtell of Citigroup to receive the Hot Mogambo News (HMN) that money never finds a home! Never! Money never "finds a home" because money, once created, is always being exchanged for an asset, and then the asset seller has to exchange the newly-acquired money for another asset, and then that asset seller has to exchange the newly-acquired money for another asset, and then that asset seller, and then another, and another, around and around, up and down, back and forth, with all the new money constantly being used to add to the money already bidding on goods and services, causing higher prices, higher and higher prices, even as the money is being nibbled away, bit by bit and piece by piece, by relentless and total government taxation at each exchange. And yet, even then, as soon as any of the money is taxed away out of the private economy, it immediately reappears! It is reborn as higher government spending, and becoming "new money" that needs to "find a home," too! So the idea of money ever "finding a home" makes me laugh the cruel Mogambo Laugh Of Scorn (MLOS) at such a benign-sounding phrase, as all this new money does is to increase prices! And, if you want to know my opinion, deliberately increasing prices is a cruel, mean-spirited, despotic and despicable thing to do to people. However, cruelty of an elitist government towards the population is nothing new, and it is a little known fact that the Elvis Presley hit, "Don't Be Cruel", originally had the lyrics: "Don't be cruel, "To the currency of a guy who trusted you Fed bastards to maintain the purchasing power of the dollar. "Don't be cruel, "To the currency of a guy who trusted you Fed bastards to maintain the purchasing power of the dollar. "I don't want no other cash! "But the dollar's turned to trash! "Don't be cruel!" Firstly, thank you, thank you, thank you for your kind applause of appreciation for my fabulous impersonation of Elvis Presley! Thank you! Thank you! Secondly, there is a moral about the purchasing power of money in there, probably in the second verse where he had a leash around his neck and being led around, which is now unfortunately lost, so you have to take my word for it, where Elvis himself – The King! – was advising you to buy gold and silver when the Federal Reserve was creating so much money, which it was doing at the time of his death in 1977, all because Nixon severed the dollar's convertibility to gold in 1971. If you don't believe that Elvis was a gold-bug and Austrian-school of economics kind of "cool guy," and/or that these are the original lyrics, then perhaps you will start to believe me when I say that the Federal Reserve creating trillions of dollars per year is going to make Elvis look more visionary than ever when gold soars to the moon in the terrifying inflation in consumer prices and the destruction of the economy! And to think you can prevent all that by just buying, as suggested by Elvis Presley himself, gold and silver! Don't be cruel, indeed! Whee! This investing stuff is easy! The Mogambo Guru for The Daily Reckoning The Nomadic Nature of Money 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."

Gold and silver withstand another attack/silver rises above 31.00 dollars. Posted: 03 Jan 2011 08:40 AM PST

Gold Seeker Closing Report: Gold and Silver Close At New Highs Posted: 03 Jan 2011 07:20 AM PST Gold rose to see a $3.34 gain at $1423.94 at the open of trade in New York before it chopped its way back lower to see a $4.80 loss at $1415.80 by a little before 11AM EST, but it then rallied back higher in the last few hours of trade and ended with a gain of 0.1% at a new all-time closing high. Silver climbed over 1% to $31.228 before it fell to see a slight loss at $30.824, but it also rallied back higher in late trade and ended with a gain of 0.68% at a new 30-year closing high.

COT Silver Report - January 3, 2011 Posted: 03 Jan 2011 06:56 AM PST COT Silver Report - January 3, 2011

update 03/01/2011 Posted: 03 Jan 2011 04:42 AM PST I didn't achieve my goal of 1000 USD donations before the end of the year.  Philippe from Switserland was   the last one.  There still remains 750 USD.  Thank you Philippe!  Come on friends, gold's up! :-) This posting includes an audio/video/photo media file: Download Now

Researchers create pseudo Palladium alloy.. time to sell? Posted: 03 Jan 2011 03:29 AM PST Interesting article. You never know if something like this will pan out or not, but I'm curious to see if this news has an effect on the price of pal. http://gizmodo.com/5722797/researche...nt+day-alchemy

Silver Leads the Way Posted: 03 Jan 2011 02:49 AM PST 2011 is starting off with a bang for the precious metals. Price action for gold and silver continues to confirm massive breakout moves to the upside. Above we have the 1 year chart of Silver showing two ascending triangles since the clear breakout in September 2010.

Silver's Artificial Price Fixing Regime Has Ended Posted: 03 Jan 2011 12:26 AM PST Silver's Artificial Price Fixing Regime Has Ended Peter Cooper Reliable market estimates suggest that there around two billion ounces of gold held above ground in bullion, and only one billion ounces of silver. Over time there has been far more silver mined than gold, around 45 billion ounces, but it has almost all been consumed by industry. Much more of the five million ounces of gold mined by mankind remains. Undervaluation At current prices then the total silver market is worth $30.6 billion and gold $2.8 trillion. Any investor ought to spot the undervaluation there. That is what happens when a commodity trades at a lower price than three decades ago. It is as though silver has been kept in some kind of communist, controlled economy. And indeed, that essentially is what happened after the 1980 silver price crash. Several banks colluded to keep the silver price locked down and in a world of its own, trading silver to profit their own books. Earlier this year the bank's position finally became untenable. Regulators began to publicly acknowledge a legion of complaints from investors and found them impossible to deny any longer. And the banks, fearing action largely liquidated their short positions over the quiet summer months. Price fundamentals change Silver prices have jumped from $17 to $30 since then. However, while this kind of price spike is always vulnerable to sudden corrections, there is a change in price fundamentals here. The real lesson is that the artificial price fixing regime is over. Communism has collapsed and price controls are off. The logic is actually for very much higher market prices, not a retracement as some now expect. History shows that once price fixing regimes collapse prices quickly inflate, and they then never go back to former levels. The gold rush of the 2000s is going to be nothing to the silver rush of the 2010s. The silver market is incredibly small to absorb the scale of investment likely to come its way as other asset classes lose their appeal thanks to rising inflation and interest rates. For the gold-to-silver price ratio to get back to its historic average then silver prices must treble; and that will be on top of the rise to come by following the gold price up and up. Market psychology And while precious metals have been growing in investor appeal for the past decade, there has been nothing yet like the over confidence of the late phase of an investment bubble. We saw that in dot-com stocks and later in residential housing. At the moment many investors in gold do so out of fear and with little enthusiasm, and they hardly touch silver. Only when the broad masses get the bug and greed overpowers this market will it be time to get out. That hardly seems to be the case right now. http://seekingalpha.com/article/2443...mail_watchlist

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