saveyourassetsfirst3 |
- Paging Blythe - "please come to the office, the principal wants to see you about your silver shorts"
- Silver's Palladium Moment
- The Future of Silver Mining
- Silver explodes/middle east problems continue/documents released my Fed showing gold involvement
- Trading Comments, 19 February 2011 (posted 17h45 CET):
- Today’s Best Investment… Rhymes With Pickles
- The Rally in Gold and Silver is Not Over Yet
- What Is Wrong With The U.S. Economy? Here Are 10 Economic Charts That Will Blow Your Mind
- Silver At Escape Velocity, As Another ECB Intervention Desperately Needed
- Rick Rule - Probably Black Swan Event Equals Gold Explosion
- Financial Times notices that gold is winning, and partly why
- Comex gold, silver margins raised 50%; and Washington state might fingerprint gold buyers
- Silver Rises to 30-Year High and Slips Into Backwardation
- Money Once Was Gold
- Gold and Aussie Gold Stock Update
- Gold: the ultimate inflation hedge
- Bits of Australia’s Gold history
- extraordinary day in the silver pit on the Comex ......
- Executive Order 6814 - Requiring the Delivery of All Silver to the United States for
- "Insider"- Gov to Confiscate Gold at $2000
- Buying T-Bonds for Dummies
- Silver or Gold?
- GEAB N°52 is available! Global systemic crisis / World geopolitical breakup – End of 2011: Fall of the “Petro-dollar wall” and a major monetary-oil sh
- 6 Charts Which Prove That Central Banks All Over The Globe Are Recklessly Printing Money
- Playing Jim Rodger's Picks With ETFs
- Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Over 2% and 7% on the Week
- Michael Victory – Don’t Squeeze The Silver
- Silver in Breakout Mode but Silver Shares Lag
| Paging Blythe - "please come to the office, the principal wants to see you about your silver shorts" Posted: 19 Feb 2011 05:18 AM PST COMEX NEWS: Gold: -contract holders now looking for delivery of gold, dont want to kick the bucket down the road anymore like normal -1,131,000 oz standing this month -commercial banks RAISE shorts by huge 7109 contracts Silver: -OI rises to fucknormous level of 150,615 -ZERO deliveries -March contracts now stand at 53,125, we are a week away from the show baby! -withdrawal of 178,378 oz - | ||
| Posted: 19 Feb 2011 04:20 AM PST Silver's Palladium Moment Ryan Jordan The hype, confusion, and debate regarding reports of silver shortages are unfortunate, as they distract from discussion of the fundamentals behind the rising silver price. Fundamentals such as: peak silver, the near depletion of government stockpiles, the future increases in industrial silver demand, manipulation in the paper silver markets likely worse than any other asset class, and the misunderstanding of silver's monetary history among gold-only investors. Admittedly, fundamentals do not always drive prices. The irrational human herd can be completely unconcerned with fundamentals at times. Still, fundamentals can be used to inspire and make others think about the relative value of overlooked financial assets. And silver, at probably less than .5% of global assets, would certainly count as overlooked. The Silver price can fire on more than one engine Compared to the first industrial revolution for silver between 1900 and 1970- where demand for the white metal exploded from under 100 million ounces to over 400 million ounces- over the last 35 years industrial demand for silver (including photography) has not increased much. Industrial demand has been volatile, but it has consistently been between roughly 350 to 550 million ounces give or take, since the mid 1970s, even if there has been a slow move to the high end of the range in the last 15 years. This may come as a surprise to some, but silver has yet to have another "industrial revolution" of the same size and magnitude as the one for silver between roughly 1900 and 1970. Maybe industrial silver demand will never increase by 4 times the way it did in the early and mid-20th century, but remember that silver mine supply also increased several hundred percent over that same time period. And no one believes that the type of increase once seen in mine supply is possible if silver's industrial demand begins to increase. It also bears repeating that the entire time of the Hunt Brother's Silver Corner, from 1973 to 1980, industrial demand for silver was declining (if only slightly), meaning that silver was rocketing higher by several hundred percent solely from investment demand (see Handy and Harman "Annual Reviews" to get a sense of the historical supply and demand of silver.) The investment demand story has propelled the price of silver higher over the course of the last decade as well: investment and coin demand has exploded by more than 300%. This category has been the only reason I can see that silver prices have moved higher in the recent past, but there are other future reasons for silver's increase as we move into the 2010s. Silver's Next Industrial Revolution A number of silver experts, foremost among them David Morgan, but also Stephen Leeb, Ted Butler and Izzy Friedman, have all been discussing the possibility of industrial demand finally breaking out of the 400-600 million range, and begin to move up closer to the 600 to 900 million range in the future, and some would extrapolate an even higher number for industrial demand in the years ahead. Of course this is all a guess, but silver is a highly versatile and in-demand metal for computers, cell phones, and many forms of alternative energy for green living. Yes, much of the silver in PCs and other electronics is recycled, so an increase in demand may also be accompanied with an increase in the ability of silver to be recovered. But as David Morgan has pointed out, the likely dramatic increase in solar energy (some put it at 20 fold over the next decade), plus the need for water purification systems, sanitized hospital or medical devices, and RFID tags all represent an increase in consumable, non-recycled silver- possibly 200 million ounces a year or more. Given the estimates of the USGS that there are only 17 or 18 billion ounces of silver in the ground, even if mine production stayed the same, there is less than 20 years of extractable silver left. So where will all of this silver come from to meet surging industrial demand? Well, the CPM Group estimates above ground stockpiles of jewelry and silverware at over 20 billion- so maybe more of this type of silver will be scraped, even though it is held in many, many small hands around the globe. On an annual basis, perhaps jewelry and silver consumption will decline by another 100 million ounces, thus freeing up more silver for industrial use? Perhaps recycling will increase from roughly 170 million ounces a year to something higher (but could it realistically double or triple??) But perhaps more likely, those who want to invest in silver coins and bullion- the same people who have driven investment/coin demand from less than 50 million ounces to over 220 million in a decade- will find that there are limits to the possible when it comes to getting access to the "other" monetary metal. New investors will be told to buy their silver from people who already have it, and not expect any more new silver supply to be "wasted" on coins, ingots, or bars. When the silver rocket takes off, good luck picking pullbacks Which brings me to the title of this piece: "Silver's Palladium Moment." Part of the reason for the allure of half-truths about 100 ounce bars being unavailable, or other gossip about shortages being taken seriously, is because many people in the precious metals industry understand just how tiny the silver market is for investment, as well as the other possible factors that can drive the silver price higher which have yet to materialize. Remember the dollar amount of available silver for sale is in the single billions of dollars & 30 billion dollars is the likely value of all the silver coins and bars on planet Earth. Contrast this to the TRILLIONS of dollars in stocks, bonds, and real estate and you get a sense for silver's rarity. These industry insiders also remember what happened to palladium between 1997 and 2000. In late 2000, Ford Motor Company panicked and bought large amounts of palladium in response to shortages and disruptions coming out of Russia, one of the world's largest Palladium producers. The price of palladium skyrocketed to near $1100 an ounce, nearly a 10 fold increase in less than 10 years. I think the PGMs are also a great investment. But unlike the platinum group metals, silver possesses a much larger concentrated short position on the COMEX, there are many more investors who only own silver as a derivative or a futures contract or on a fractional reserve basis, and - at least according to the USGS- the platinum group metals are only about 6 times more rare than silver in the earth's crust, and not over 40 times as expressed in the price. Additionally, silver has yet to experience the industrial revolution described above. I do realize that platinum and palladium are nearly a hundred times rarer above ground and that the PGM's in the ground can be very uneconomical to extract, but silver is the cheapest precious metal, and therefore the easiest one to acquire for poorer investors looking for a way into monetary assets separate from the banking system. Yes, all assets are manipulated to varying degrees, and all assets have their own set of possibly bullish fundamentals to go with them, but I am at a loss to think of another asset with a longer laundry list of reasons to go higher than silver. ******** University of San Diego Lecturer University of San Diego, KIPJ 262, 5998 Alcala Park, San Diego, 92110 Primary Tel 619.260.4756 Industry Education/Academia ryanjordan@sandiego.edu http://www.gold-eagle.com/editorials...dan021811.html | ||
| Posted: 19 Feb 2011 02:51 AM PST In my previous piece to this, I focused upon the definition of a "silver mine", in order to expose the biggest myth about silver: that having most of the world's silver produced as a "byproduct" of other mining is a normal state of affairs. What I demonstrated conclusively (through simple arithmetic) is that the only reason that most of the world's silver production doesn't come mostly from "primary" silver mines is purely a function of the price of silver (i.e the extremely low price). More specifically, I pointed out how it was the relentless manipulation of the price of silver – which was kept far below its "fair market value" – that resulted in the "silver mine" becoming an "endangered species". In this commentary, I intend to build upon that analysis, by explaining the implications of that analysis with respect to the creation of new silver mines. To start this process, it is first helpful to examine the gold mining industry, given the many and obvious parallels between the two metals. With respect to the gold market, knowledgeable investors are well aware that this metal has also been subjected to decades of price manipulation. While the manipulation of the gold price can be seen as "extreme" relative to the pricing of other metals, the manipulation of silver was "extreme" in relation to the price of gold. To understand this market-manipulation better, it's instructive to look at the history surrounding the "bottom" of the gold market. In this respect, there is no better place to start than with the observations made at that time by our good friends at GATA – the Gold Anti-Trust Action committee. On May 25, 1999; Bill Murphy had this to say, in a piece titled "Bottom in, bull market begins": Gold continues to make 20-year lows led by the unending barrage of selling in the physical market by Goldman Sachs…Goldman Sachs has been relentless in its selling since right before the Bank of England's announcement and has not let up since…We told you two weeks ago that the word was out in London that Goldman Sachs has a 1,000-tonne short position on its books… The "spot" price of gold on that date was $270/ounce, while the price of silver was just over $5/oz. The "announcement" which Bill Murphy alludes to is the infamous decision by future Prime Minister Gordon Brown to dump more than half of the UK's gold reserves onto the market at the absolute bottom (to bail-out Goldman Sachs?), costing his country billions of pounds. At this price, the world's gold-mining industry was decimated. Well over 90% of the world's gold mines were forced to shut-down, as only the world's absolute "richest" deposits could even be mined on a break-even basis at that price. Indeed, this reality alone is conclusive proof of that manipulation. What is important to note, however, is that at no time has the world's gold production ever been produced primarily as a "byproduct". In other words, that industry was never destroyed to the same degree as silver mining. In fact, Bill Murphy was slightly premature. The price of gold would actually decline to as low as $253/oz (approximately 6% below his call of a "bottom"), before rocketing upward more than 500% in the nearly 12 years since. My guess is that those investors who bought at $270/oz have forgiven Bill for being a little "early". The absolute "bottom" of the silver market occurred much sooner, back in 1992, with the price briefly going as low as $3.65/oz, and it averaged an amazing $3.95 throughout that year. Why is this "amazing"? Because that price represented a 600-year "low" for the silver market. | ||
| Silver explodes/middle east problems continue/documents released my Fed showing gold involvement Posted: 19 Feb 2011 02:48 AM PST | ||
| Trading Comments, 19 February 2011 (posted 17h45 CET): Posted: 19 Feb 2011 02:45 AM PST As I suspected when I wrote my last Trading Comments a week ago, silver was ready to explode. And indeed it did, climbing 7.7% on the week. Gold had a great week too, climbing 2.1%, but | ||
| Today’s Best Investment… Rhymes With Pickles Posted: 19 Feb 2011 02:13 AM PST Today's Best Investment… Rhymes With Pickles A huge opportunity to hedge against both inflation and deflation is lying out there in the open. There are no transaction costs and right now there's even a built-in discount. But most people will never realize any of this. In 1933 President Franklin Delano Roosevelt signed Executive Order 6102, which made it illegal for US citizens to hold gold bullion.  Prior to that order, the $20 bill was essentially a warehouse receipt for a one-ounce gold coin. Prior to the Federal Reserve Act of 1914, the $20 bill actually told you this.  After Executive Order 6102, $20 notes weren't allowed to be exchanged for gold anymore. Americans couldn't legally own or trade gold as money and savings, only as jewelry or collectible coins. A year after making monetary gold ownership illegal, FDR revalued gold from $20.67 per ounce to $35 an ounce with the Gold Reserve Act. The Act also required all gold and gold certificates to be turned over to the Treasury. The dollar was debased. Instead of "containing" 1/20 an ounce of gold, each dollar now only contained (or represented) 1/34 an ounce. And of course you couldn't actually own the gold itself. In 1971 Nixon severed the last official ties between gold and the dollar. The dollar quickly sunk to its real value, which had been debased by years of money supply inflation. By 1975, Americans were allowed to own bullion gold again, but during the roughly 40 years bullion gold ownership had been illegal, the dollar had been drastically debased. At its former lowest point in the summer of 1980, the dollar was worth only 1/850 an ounce of gold. It regained some value for a while, but right now a dollar gets you less than 1/1300 an ounce of gold. That was the story with a piece of paper that was merely standing in for a monetary metal. But what happens in the case of circulating coins actually composed of monetary metals? Let's look at quarters, dimes, nickels and pennies…
The average American has no idea what inflation really is or why currency debasement is a problem at all. He figures one metal is as good as another in minting of the currency…that when the face value of a coin falls below the value of the metal in the coin, it's nothing more than a curiosity. Substitute a cheaper metal, they think. Problem solved. And indeed the problem is solved for the government, which mints the coins made of real money at a loss after the effects of bouts of the inflation started by monetization of government debt. For savers and the overall economy on the other hand…their problems are just beginning… But that is a story for another time. For now let's look at the opportunities to be had when the government makes metals available for a fraction of their market price via coins…And let's see if there are any opportunities left (Hint: there are!). If you had seen the writing on the wall in the early 1960s and started hoarding quarters and dimes while they still were almost wholly silver, you would have found that your dimes were worth a high of $3.57 each in 1980 and your quarters were worth $8.93 each. In fact, these 90% coins still trade just like regular silver bullion bars and rounds. They were taken out of circulation – "hoarded" – by those savvy to debasement (Gresham's Law tells us that good money will be hoarded when bad money floods the market). These coins were collected without any transaction costs. They were bagged up with different face value totals: $1,000 bags, $500 bags, $250 bags, $100 bags and $50 bags. Each of these bags traded for over 35 times their face value because of the silver in the coins. At least they did at silver's peak in 1980. Even during the ensuing 20-year slump in silver prices, the value of silver bullion coins never dipped below three times face value. And now, thanks to waves of money and credit expansion from the Federal Reserve, silver is pushing back toward its old highs. These bags of silver coins are trading at more than 20 times their face value. They may hit 30 times face value again…and beyond… Silver probably has another trick or two up its sleeve. But let's turn our attention to the humble nickel… Every single circulating nickel still has 3.75 grams worth of copper each…along with 1.25 grams of nickel. Copper is currently about $4.46/lb. Nickel is currently about $12.97/lb. So if you do the math, each nickel is worth about 7.3 cents. 120 nickels pieces is worth $6.00 at face value. Those 120 coins contain about a pound of copper and 1/3 pound of nickel. That's about $8.76. You can't cash in on this arbitrage directly (anti-smelting laws for pennies and nickels were introduced in late 2006). But the bullion market for cupronickel coins will develop, just as it did for silver US coins. This will happen once the government starts minting five-cent pieces made out of cheaper metals. To those who doubt this will happen, I refer you to the bags of silver coins trading as bullion for over 20 times their face value. You can easily order such a bag right now by going to any of a number of online bullion dealers. These bags of coins sell right alongside silver bars and rounds. Right now, the government is subsidizing your copper and nickel purchases…and cutting out the middleman. As much as we complain about government, we ought to stop and offer them a little thanks for this one. What's even more interesting is that hoarding nickels provides an imbedded hedge against deflation. That's because a nickel will always be worth a nickel, at least. So if the dollar strengthens and copper, silver, and gold all get cheaper in dollar terms, you can still spend your nickels just like any other money. Your purchasing power stays the same, maybe even increases. But if the dollar declines, then the value of the cupronickel in the currency will rise against the face value. Eventually – at two or three times face value – these five-cent pieces will trade as bullion just as 90% silver quarters and dimes did and still do. Again, there is currently no transaction cost to saving in nickels and no risk from plummeting metal prices. There is literally nothing (in case of deflation) to lose and everything (in case of inflation) to gain. Your only real problem is storage; a few thousand dollars of nickels takes up a lot of space…and it's heavy. But people had the same problem with silver when it was cheap. I doubt they're complaining now.  Having "too much" cupronickel won't seem like much of a problem if inflation continues to drive the cupronickel in five-cent pieces far in excess of face value. The cupronickel is America's last piece of honest currency.February 19, 2011 Gary Gibson is the managing editor for Whiskey and Gunpowder. He joins the Whiskey staff as a long-time fan and reader of both Whiskey and Gunpowder and The Daily Reckoning. A graduate of Fordham University, Gary now spends his days reading about and writing on limited government, sound money, personal responsibility and resource investing. | ||
| The Rally in Gold and Silver is Not Over Yet Posted: 19 Feb 2011 01:00 AM PST
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| What Is Wrong With The U.S. Economy? Here Are 10 Economic Charts That Will Blow Your Mind Posted: 18 Feb 2011 10:17 PM PST Next is this piece that I've been saving for the weekend. It's a rather longish article that's posted over at theeconomiccollapseblog.com website...and was sent to me by reader Tom Morse. In ten charts, the essay pretty much lays out the economic collapse that faces the U.S. in the not-to-distant future. In my opinion, it's certainly worth spending a few minutes on. here | ||
| Silver At Escape Velocity, As Another ECB Intervention Desperately Needed Posted: 18 Feb 2011 10:17 PM PST Image:  Washington state reader S.A. provides this zerohedge.com piece where the proprietor gloats over the problems now facing JPMorgan et al...and the big margin calls in silver that went out at the close of trading yesterday. The graph is worth the trip...and T.D. also mentions the woes confronted by the latest ECB bond monetization. It's a very short read. here | ||
| Rick Rule - Probably Black Swan Event Equals Gold Explosion Posted: 18 Feb 2011 10:17 PM PST Rick Rule of Global Resource tells King World News that he has to be bullish on silver in the short term as well as the long term because of the "extraordinary imbalance of supply and demand." Rule adds that a "black swan" event seems ever more likely to send gold soaring as well. Rule, one of the last dinosaurs that never believed that the prices of silver and gold were managed, is certainly singing a different tune now that he works with Eric Sprott all the time. The blog is worth the read. | ||
| Financial Times notices that gold is winning, and partly why Posted: 18 Feb 2011 10:17 PM PST Image:  Here's another GATA release for you. It's a story from Britain's Financial Times yesterday...and their headline reads "Gold Will Keep Its Shine This Year". The story starts off with the following paragraph..."Unbelievable. Explosive. Insatiable. These are some of the words bankers are using to describe the gold market. That may come as a surprise, as the gold price has had an uncharacteristically quiet start to the year, for the most part trading either side of $1,350 an ounce." here | ||
| Comex gold, silver margins raised 50%; and Washington state might fingerprint gold buyers Posted: 18 Feb 2011 10:17 PM PST Image:  Today's first precious metals-related story is a three-for-one GATA release that contains information about the raising of margin requirements in gold and silver...and a proposed law in Washington state that might require gold buyers to be fingerprinted for anyone who purchases more than a tenth of an ounce of gold. I would suggest that you spend some time on this. here | ||
| Silver Rises to 30-Year High and Slips Into Backwardation Posted: 18 Feb 2011 10:17 PM PST G-10 minutes from 1997 show central bankers conspiring about gold. Probably Black Swan Event Equals Gold Explosion: Rick Rule. Why isn't Wall Steet in Jail?...and much, much more. ¤ Yesterday in Gold and SilverGold did virtually nothing on Friday. The New York low [$1,380.90 spot] came shortly after Comex trading began...and the high of the day [$1,393.20 spot] occurred during the lunch hour. Then it sold off a few dollars into the close. Nothing to see here.
The silver price was almost as quiet as a church mouse all through Far East and London trading...and right up until the London p.m. gold fix at 3:00 p.m. GMT...or 10:00 a.m. Eastern. Then, away it went to the upside. In the space of three hours, silver was up a bit more than a dollar, before getting sold off into the close of Comex trading at 1:30 p.m. in New York. When electronic trading began, silver continued to inch higher right up until the close at 5:15 p.m. Eastern time. Silver's New York low of $31.67 spot came at 8:30 a.m. sharp...and the high tick [$32.92 spot] occurred a few minutes before 1:00 p.m. Silver is now in backwardation in all months and years...and I'll have more on that in 'The Wrap'. Looking at the Kitco chart below, I get the distinct impression that the silver price would have gone higher had it been allowed to rise freely...as I suspect that there was some intervention in the price in the latter half of the New York trading session. Maybe I'm just imagining things, but I don't think so.
The dollar opened around 78.00 cents...rose to 78.20 cents around lunchtime in London [7:00 a.m. in New York]...and then fell out of bed to the tune of 60 basis points...and closed at 77.60.
The gold stocks were in positive territory right from the opening bell yesterday morning...and rose slowly until 1:15 p.m. Eastern time..before rolling over and giving up a percentage point of those gains by 2:30 p.m...before trading sideways into the close. Normally, the gold stocks follow the gold price like a shadow...and I found the 1:15 p.m. sell-off rather strange considering the fact that the tops were in for both metals about half an hour before that. Here's the 5-day HUI for the week that was. It's a very happy looking chart, but the gains in the silver shares dwarfed those of their golden cousins...which is why my precious metals portfolio is 75/25 silver/gold.
It was a rather quiet delivery report from the CME yesterday...as only 3 gold and 13 silver contracts were posted for delivery on Wednesday. The GLD ETF just can't seem to catch a break at all. In the face of rising prices...and for the second time this week...it has recorded a withdrawal. This time it was 29,267 troy ounces. But it was an entirely different kettle of fish over at the SLV ETF, as they recorded a huge increase of 2,587,783 troy ounces. Based on the record gains in the silver price this past week, it's a pretty safe bet that the SLV is still owed a mega amount of silver...and Blackrock has probably been forced to short the shares in lieu of the physical metal itself. For the fifth day running, the U.S. Mint has had a sales report. Yesterday they sold another 15,000 ounces of gold eagles, along with a paltry 50,000 silver eagles. Month-to-date...gold eagles sales are now up to 75,000 ounces...and silver eagle sales are at 1,822,500. Over at the Comex-approved depositories on Thursday, they reported receiving 84,255 ounces of silver...and shipping 262,603 ounces out the door. The net change on the day was a drop of 178,348 troy ounces. The Commitment of Traders report [for positions held at the close of trading on Tuesday, February 15th] showed a deterioration in open interest in both silver and gold. In silver, the bullion banks increased their short positions by 3,930 contracts, or 19.65 million ounces. The net Commercial short position in silver now sits at 275.2 million ounces. Of that amount, the '4 or less' traders are short 209.6 million ounces...and the '8 or less' bullion banks are short 270.7 million ounces of silver. The link to the full-colour COT report is here...and it's definitely worth looking at. In gold, the bullion banks increased their short positions by a further 8,715 contracts...or 871,500 ounces. The Commercial net short position in gold, as of the Tuesday cut-off, was 21.9 million ounces. The '4 or less' bullion banks were short 16.4 million ounces...and the '8 or less' bullion banks were short 22.2 million ounces of gold. The link to the full-colour gold COT report is here...and it's also worth a look. Nick Laird over at sharelynx.com was kind enough to update Ted Butler's "Days to Cover Short Positions" graph for all commodities traded on the Comex. As is always the case, the silver and gold short positions are the stand-out features on this chart...as they've been for decades.
For the week that was, gold was up about $33 from its Monday low to its Friday close...which is 2.4%. But silver was on a tear...and was up $2.72 for the week...about 9.1%...which is a staggering amount. Needless to say, the gold/silver ratio is now broken through a low that has existed for 30+ years...and I thank Washington state reader S.A. for providing this 30-year Gold/Silver Ratio graph. It's another chart that needs no embellishment from me. The gold/silver ratio closed at 42.67 on Friday...a data point that's not on this graph.
¤ Critical ReadsSubscribeForeclosure Volume SOARS 50% In California And Arizona, As The Moratorium EndsBeing the weekend and all...I have a lot of stories today...a couple of which I've been saving all week. Today's first story is courtesy of reader Steve Pierce...and is posted over at the businessinsider.com website. Analysts have been warning for months that the decline in foreclosures was due to the robo-signing moratorium, and did not signify an improving housing market. Well, now that shoe has dropped...and next month things could get even worse. The story is only a handful of paragraphs...but definitely worth your time. here  G20 Paris: Bernanke defends easy money policy and calls for currency reformThis next item is from The Telegraph and is courtesy of reader Roy Stephens. US Federal Reserve Chairman Ben Bernanke defended his country's easy money policy ahead of the G20 leaders meeting in Paris, and joined Bank of England Governor Mervyn King in calling for currency reform. Judging by the contents of this article, this G20 meeting is already doomed to failure. here  What Is Wrong With The U.S. Economy? Here Are 10 Economic Charts That Will Blow Your MindNext is this piece that I've been saving for the weekend. It's a rather longish article that's posted over at theeconomiccollapseblog.com website...and was sent to me by reader Tom Morse. In ten charts, the essay pretty much lays out the economic collapse that faces the U.S. in the not-to-distant future. In my opinion, it's certainly worth spending a few minutes on. here  Ivory Coast Banks, Stock Exchange Close Amid Bank RunYesterday I posted a story about a South Korean bank that had collapsed...and how depositors were lined up at the door. Here's a similar story about banks over in the Ivory Coast. Their financial system is grinding to a halt with banks closing and the stock market suspended, sparking a run on the lenders left open as the West African nation's political crisis drags on. It's a Bloomberg piece that's courtesy of reader Raymond Zuiderwijk...and it's worth the read. here  Saudi Arabia Risks Shiite Unrest in Wake of BahrainHere's a Bloomberg story courtesy of Washington State reader S.A. Violent unrest in Bahrain provoked by discontent among the majority-Shiite Muslim population risks spilling over to their co-religionists in neighboring Saudi Arabia, which holds one-fifth of the world's oil, analysts say. Unrest in Bahrain, which is linked to Saudi Arabia by a 26-kilometer (16-mile) causeway and whose capital, Manama, is only a four-hour-drive from its Saudi counterpart, Riyadh, has in the past spread across the border. The story is worth running through. here  The World from Berlin: 'Witnessing Gadhafi's Overthrow Would Be a Special Pleasure'Roy Stephens brings us this next story that's posted over at the German website spiegel.de. The wave of rebellion in the Arab world keeps spreading, but brutal crackdowns in Libya and Bahrain show that pro-democracy demonstrators are by no means assured of success. German commentators argue that Moammar Gadhafi will be hard to topple and call on the EU to help prevent more violence. These in-depth essays from European sources are always worth the read, in my opinion...and this one is no different. here Comex gold, silver margins raised 50%; and Washington state might fingerprint gold buyersToday's first precious metals-related story is a three-for-one GATA release that contains information about the raising of margin requirements in gold and silver...and a proposed law in Washington state that might require gold buyers to be fingerprinted for anyone who purchases more than a tenth of an ounce of gold. I would suggest that you spend some time on this. here | ||
| Posted: 18 Feb 2011 10:04 PM PST When Money Was Real Money Backed By Gold. -Wikopedia Editor: There is a plan to use the IMF (AKA US Treasury and Wall Street) to be the front man for the new world order and one currency. We also got disturbing news yesterday from an impeccable source that when gold touches $2,000 it's confiscated in the USA for about $200. Then it's to be reissued by the Treasury for $10,000 per ounce to back the new IMF world currency using SDRS in 2011. Large physical gold is being moved to Canada. http://money.cnn.com/2011/02/10/markets/dollar/index.htm "The gold standard is a monetary system in which the standard economic unit of account is a fixed weight of gold. There are distinct kinds of gold standard. First, the gold specie standard is a system in which the monetary unit is associated with circulating gold coins, or with the unit of value defined in terms of one particular circulating gold coin in conjunction with subsidiary coinage made from a lesser valuable metal." "Similarly, the gold exchange standard typically involves the circulation of only coins made of silver or other metals, but where the authorities guarantee a fixed exchange rate with another country that is on the gold standard. This creates a de facto gold standard, in that the value of the silver coins has a fixed external value in terms of gold that is independent of the inherent silver value. Finally, the gold bullion standard is a system in which gold coins do not circulate, but in which the authorities have agreed to sell gold bullion on demand at a fixed price in exchange for the circulating currency." Gold certificates were used as paper currency in the United States from 1882 to 1933. These certificates were freely convertible into gold coins.
        This posting includes an audio/video/photo media file: Download Now | ||
| Gold and Aussie Gold Stock Update Posted: 18 Feb 2011 09:00 PM PST
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| Gold: the ultimate inflation hedge Posted: 18 Feb 2011 08:11 PM PST Is gold the ultimate hedge against inflation? Many investors clearly think so and with inflation now running at twice the Government's target it is not surprising that gold hasn't lost its lustre. Recent research from the World Gold Council shows how gold has held its value over the long term when compared with other commodities. The relative price of gold and oil has remained almost constant over the past 50 years. So although the price of both (in either pounds or dollars) has risen during this period, if you were buying a barrel of oil with bullion you would hand over roughly the same weight of gold as you would have done in 1950... Read | ||
| Bits of Australia’s Gold history Posted: 18 Feb 2011 05:00 PM PST | ||
| extraordinary day in the silver pit on the Comex ...... Posted: 18 Feb 2011 12:05 PM PST http://tfmetalsreport.blogspot.com/2011/02/wow.html Wednesday, February 16, 2011Wow At the risk of sounding crazy. At the risk of ruining whatever minimal "reputation" I may have. Most importantly, at the risk of losing money, I have to say this: I think we have Blythe on the run. Big time. My rationale for this is going to be difficult to summarize in writing but here goes. Bear with me... Today, 2/16/11, was an extraordinary day of FUTFs and FUBMs in the silver pit on the Comex and I'll explain that shortly but it all needs to be placed into context. If someone wants to purchase physical silver through the Comex, they must first buy a future or option contract for a "delivery" month. The current delivery contract is the March11. Before the close of trading on 2/28, any holders of March contracts must sell their positions or be forced to take delivery. Those unwilling to take delivery typically "roll" their position into the next month, which is May. If an investor does intend to take delivery, that person must, by the close on the 28th, show in their account enough money to pay for their acquisition. A single contract is for 5,000 ounces so, at $30/oz, you must show available funds of $150,000. For 10 contracts, you must have $1.5MM. This is kind of a "put up or shut up" thing. It keeps goofballs from claiming they want delivery when they really can't afford it. On the 28th, you've got to have the dough in your account to "prove" to TPTB that your are serious. Every delivery month, the EE/Comex plays this game and, every month, enough longs simply roll instead of standing for delivery so that the Comex has yet to default on their obligations to deliver the physical silver. Now, here's the problem...Monday was 2/14. Only 10 trading days to go until the critical 28th. Heading into Monday's trade, there were still 62,692 open contracts for March. This had to really get the attention of the EE and they, without question, went into Monday with a plan to attack silver and scare as many March longs as possible into rolling to May or later. Unfortunately for Blythe, silver began to rally in the wee hours of Monday morning and broke $30 while she was still sleeping. It closed that day above $30.50. But that wasn't the true disaster for the EE. The real shock was when they got the new OI numbers Monday night and found that the March OI had only fallen to 61,720. Panic surely began to set in. Then yesterday, silver traded even higher, briefly touching $30.90. Earlier today, we got the OI numbers basis yesterday and it was an eye-opener. As of last night, there are still 59,851 open March contracts. And first notice day is now only eight days away!!! Blythe had this information before the general public so she knew, going into today, that she had to attack again and she did. Here's your chart: Obviously, it didn't work and that's the problem. Recall for a moment how the EE caps price. They do so by flooding the Comex with an almost endless amount of unbacked, paper silver. Think about that trade, though. To sell short, you need a buyer on the other side of the trade. And now, at this late hour, how can you reduce the open interest in the March contract if you're only selling new paper shorts to resolute longs who intend to stand for delivery in eight days? By raiding and selling, you're only compounding your problem because you are creating more open interest! If you're Blythe, you're left with only being able to freely sell the forward contracts in an attempt to influence the spot and nearby price. Does this explain the current backwardation? Probably. To the point, however, what's a girl to do? You can see by looking at the chart above that Blythe tried to raid today but she didn't seem to do it with the usual bluster and gusto. How could she? Every new March contract she sells only adds to her problem. She is truly caught in a catch-22. Again, what's a girl to do? If the March longs stay resolute, she's screwed. Even if only 20,000 stand for delivery, thats 100,000,000 ounces that the Comex has to deliver. By most estimates, that's their entire inventory. She and The Evil Empire must, somehow, convince/force March contract holders to close their positions but if they can't scare them by crushing price, how do they do it? They could get the CME to raise margin requirements but if you're ready to stand for delivery by putting up 100% of the cost in eight days, a margin increase today is of zero consequence. So what's left? She can't scare people out through raids and she can't finance people out through margin hikes. She's ****ed. She/They will be forced to settle again in cash + premium, just as many suspected they had back in December. However, back then it was just a couple thousand contracts. Now it could be 20,000. Shit, it could be 40,000! And the problem is, word is out. What do you think will happen in May?!? Will 80,000 stand for delivery? 100,000? So the point is this: Ding dong, The Wicked Witch is hurting. Bad. All the years of Evil Empire domination/manipulation of the PMs appear to be coming to a rapid and spectacular end. Watch the Open Interest numbers very closely. They are your tell. Buy all dips until and unless the OI situation significantly changes. Now truly appears to be the moment we've been waiting for. TF | ||
| Executive Order 6814 - Requiring the Delivery of All Silver to the United States for Posted: 18 Feb 2011 11:54 AM PST for Coinage.More on the subject. http://crisisboom.com/2011/02/16/gov...-confiscation/ EO 6814...... August 9, 1934 By virtue of the authority vested in me by the Silver Purchase Act of 1934 and of all other authority vested in me, I, Franklin D. Roosevelt, President of the United States of America, do hereby require the delivery of all silver situated in the continental United States on the effective date hereof, by any and all persons owning, possessing, or controlling any such silver, and do hereby require any and all persons owning, possessing, or controlling any such silver to deliver the same in the manner, upon the conditions and subject to the exceptions herein contained, such action being in my judgment necessary to effectuate the policy of the Silver Purchase Act of 1934. . . . Section 2. Silver required to be delivered..–There shall be delivered in accordance with the terms of this order all silver situated in the continental United States on the effective date hereof, except silver falling within any of the following categories so long as it continues to fall thereunder: (a) Silver coins, whether foreign or domestic; (b) Silver of a fineness of .8 or less, which has not entered into industrial, commercial, professional, artistic, or monetary use; (c) Silver mined, after December 21, 1933, from natural deposits in the United States or any place subject to the jurisdiction thereof: Provided, however, That so much of such silver so mined in the continental United States on or before the effective date of this order which shall not have been deposited with a United States mint tinder the proclamation of December 21, 1933, shall, if processed to a fineness greater than .8 within 75 days from the effective date of this order, be delivered in accordance with this order, not later than 90 days from the effective date hereof, or if processed to a fineness greater than .8 after 75 days from the effective date of this order, be delivered within 15 days thereafter in accordance with this order; (d) Silver held for industrial, professional, or artistic use and unmelted scrap silver and silver sweepings in an amount not exceeding in the aggregate 500 fine troy ounces belonging to any one person; (e) Silver owned on the effective date hereof by a recognized foreign government, foreign central bank, or the Bank for International Settlements; (f) Silver contained in articles fabricated and held in good faith for a specific and customary use and not for their value as silver bullion; or (g) Silver held under a license issued in accordance with Section 6 hereof. Section 3. Time and place of delivery..–The silver required to be delivered here under shall be delivered not later than 90 days from the effective date hereof to the United States mint nearest to the place where the silver is situated immediately prior to delivery: Provided, That such silver temporarily falling within the exempt categories enumerated in Section 2, shall be delivered at the end of 90 days from the effective date hereof, or 15 days after the time when it ceases to fall within such categories, whichever date is later. Any person acquiring ownership, possession, or control of silver required to be delivered under this order after 75 days from the effective date hereof, shall deliver such silver within 15 days of such acquisition. SECTION 4. Amount returnable for silver..–The silver herein required to be delivered shall be coined into standard silver dollars, or otherwise added to the monetary stocks of the United States in accordance with the proclamation, bearing the same date as this order, relating to the coinage of silver, and there shall be returned therefor in standard silver dollars, silver certificates, or any other coin or currency of the United States, the monetary value of the silver so delivered (that is, $1.2929+ a fine troy ounce), less a deduction of 61 8/25 percent thereof for seigniorage, brassage, coinage, and other mint charges, as provided in such proclamation; that is, the amount returnable for the silver delivered in accordance herewith shall be an amount equal to 50+ .– a fine troy ounce, which amount is not less than the fair value, at the time of this order, of the silver required to be delivered hereunder as determined by the market price over a reasonable period terminating at the time of this order. Section 5. Reimbursement of costs..–The Secretary of the Treasury shall pay all necessary costs, actually incurred, of the transportation of such silver and standard silver dollars, silver certificates, and other coin or currency of the United States, including the cost of insurance, protection, and such other incidental costs as may be reasonably necessary. Persons desiring reimbursement of such costs shall submit their accounts on voucher forms which may be obtained by writing to the Treasurer of the United States, Washington, D.C. Section 6. Licenses..–The Secretary of the Treasury, subject to such regulations as he may prescribe, acting directly or through such agency or agencies as he may designate, shall issue licenses authorizing the withholding of silver which the Secretary of the Treasury, or such agency as he may designate, is satisfied (a) is required for legitimate and customary use in industry, profession, or art by a person regularly engaged in such industry, profession, or art or in the business of processing silver or furnishing silver therefor; (b) has been imported for reexport; or (c) is required to fulfill an obligation to deliver silver in such amount to a third person, incurred or assumed by the applicant on or before the effective date of this order; Provided, That at the date of the application, the applicant owns such silver or holds the obligation of another to deliver to him such silver. The Secretary of the Treasury may, with the approval of the President, issue licenses authorizing the withholding of silver for purposes deemed to be in the public interest and not inconsistent with the purposes of the Silver Purchase Act of 1934 and of this order. Section 7. Deliveries in fulfillment of obligations or to licensees.–No person required to deliver silver owned by him or in his possession or control shall be deemed to have failed to comply with the provisions of this order, if such silver is delivered in fulfillment of an obligation incurred or assumed by such person on or before the effective date of this order or is delivered to a person licensed to acquire and withhold silver in such an amount under Section 6. . . . -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Citation: John T. Woolley and Gerhard Peters, The American Presidency Project [online]. Santa Barbara, CA. Available from World Wide Web: http://www.presidency.ucsb.edu/ws/?pid=14741 | ||
| "Insider"- Gov to Confiscate Gold at $2000 Posted: 18 Feb 2011 11:41 AM PST Anonymous source, so take with a grain of salt, but interesting nevertheless- http://www.shtfplan.com/precious-met...-2000_02182011 | ||
| Posted: 18 Feb 2011 09:00 AM PST I was somewhat staggered when I saw that Total Fed Credit shot up by an incredible $31 billion dollars last week, which (in the history of new Fed Credit) is right up there with "the biggies." Another biggie was that the Fed created the money to buy $28.3 billion in US government securities! All of this in One Freaking Week (OFW)! Of course, the money went through a lot of middlemen, like the Fed banks so that they can get a little piece of this "monetizing-the-debt" action, and financial-services industry got a taste to handle the transaction since the Fed is, so they say, prohibited from dealing directly with the Treasury Department, which is issuing the deluge of bonds and desperately needs somebody really, really stupid to buy them. Since really, really stupid people with lots of money to invest is about as rare as a good 50-cent taco, nobody in their right mind is going to buy T-bonds at such high prices (and thus low yields) when the despicable Federal Reserve is creating So Freaking Much Money (SFMM), because all that new money inflation means high rates of price inflation, meaning that bond prices should fall precipitously, and especially those bonds that were already so highly-priced that they end up (in precise mathematical terms) with yield = squat, so that from then on, everybody would point at them on the street, and laugh at them, and say, "There's that doofus-goofus that bought all those high-priced government bonds at insanely-low yields when the Federal Reserve was creating So Freaking Much Money (SFMM) that only an idiot like ol' doofus-goofus here would buy them! Hahahaha!" Enter (sound of heavy footsteps) the Federal Reserve. I assume that Doug Noland was commenting about this whole nasty Federal Reserve thing, too, when he writes, "First, it was the Federal Reserve. After working studiously to create one, the Fed tossed its vaunted 'exit strategy' right into the scrapheap. They were to have moved to reduce holdings and liquidity operations that had ballooned during the 2008 financial crisis. Our central bank abruptly reversed course and instead chose to significantly expand stimulus – even in a non-crisis environment," so that now "Fed Credit has inflated $189bn in the past 14 weeks, with market perceptions of 'too big to fail' and moral hazard being further emboldened." I am perfectly delighted by Mr. Noland's use of the sophisticated phrase "further emboldened," and suddenly realize what all those people meant when they said to me, "Why don't you write like Doug Noland instead of that Stupid Mogambo Crap (SMC) you write, which makes you sound like a mental defective yammering, yammering, yammering about the same damned thing; buy gold, silver and oil when the Federal Reserve is creating so much money so that the end-result must be a hyperinflationary collapse, where all is in ruins, and bitter wailing is heard as a woeful chorus echoing across the bare, blighted, blackened, beleaguered land, except for gold and silver, which soar in value, as evidenced by that very result happening every time in the last 4,500 years when some dirtball government borrowed and spent its way into un-payable bankruptcy, and especially when using a worthless fiat currency?" Mr. Noland makes no mention of my delicious phrase "bitter wailing is heard as a woeful chorus echoing across the bare, blighted, blackened, beleaguered land," which constitutes my valiant effort to wax lyrical, as he does with his memorable "further emboldened," responding, as is my wont, to the use of massive firepower with 16 words to his pathetic 2, unless you are weighting the scoring towards brevity, and then I'm screwed again! Damn! Damn! Damn! I hate this! Now you can see how everybody is out to get me, making me look ridiculous and showing off about how smart they are and how stupid I am. I mean, how long do I have to take this crap all the time? Mr. Noland does not wade into my Mogambo Swamp Of Paranoia (MSOP), and instead goes on, "There was also a popular movement to rein in extraordinary fiscal stimulus. Well, there has been talk and bluster and, what do you know, additional stimulus – and no exit anywhere on the horizon." Well, to be fair, I can see how the whole idea of reining-in fiscal stimulus is ridiculous, as the whole idea behind fractional-reserve banking was predicated on the dismal, inescapable fact that once you start allowing the banks to create and loan massive, unbelievable multiples of every dollar deposited, you can't stop. And the reason is simplicity itself: if you borrow $1 and promise to pay back $1.05, it is one thing, but if everyone borrows $1 and promises to pay back $1.05, then it is quite another! Obviously, a lot of people are going to have to borrow $1.10 to pay back the $1.05, and then they have to borrow $1.16, then $1.22, then $1.28, all the time getting worse and worse and worse. And now that government (local, state and federal) spending comprises HALF of all spending in the USA, the system has hideously mutated into a giant corrupt cesspool that is totally dependent on borrowing to support government spending. It seems all very complicated, of course, but thankfully all one needs to know is to buy gold, silver and oil when the Federal Reserve is creating so much excess money! Whee! This investing stuff is easy! The Mogambo Guru Buying T-Bonds for Dummies originally appeared in the Daily Reckoning. The Daily Reckoning has published articles on the impact of quantitative easing, bakken oil, and hyperinflation. | ||
| Posted: 18 Feb 2011 08:20 AM PST This is from a novel called "Patriots: A Novel of Survival in the Coming Collapse". Next, Kevin reported on his transactions. "I got an entire buffalo hide in really good shape for 10 rounds of .30-06. I figure that it'll help keep us warm up at the LP/OP next winter. Another guy traded me a small Bearcat scanner--one of the portable ones the size of a walkie talkie--for 20 rounds of .45 ACP. It runs off of batteries, and we have plenty of ni-cads, so I thought, 'why not?' Not many people have any source of power nowadays. I figure that's the only reason the guy was willing to sell it so cheap. I also got a pair of Belgian white rabbits--a buck and a doe, for 25 rounds of .22 long rifle. My mother would be proud. She'd say that I got 'Such a deal!' The cage for the rabbits cost a lot more, though. For it, I had to give up a whole 50 rounds of .22 and three pre-'65 silver quarters. I think it's amazing what a few silver dimes or quarters will buy." After a pause, Kevin said, "I feel sorry for all those people I knew who bought one ounce gold coins as a 'survival hedge.' I can see now that a full ounce gold coin is too compact a form of currency, and it isn't easily divisible. I suppose that people who bought the gold coins minted in the one tenth of an ounce weights are more fortunate. What would a full ounce of gold buy? That Corvette that we saw advertised? A half a dozen cows? Maybe. It certainly wouldn't do much good for someone trying to buy day-to-day necessities. It's pretty apparent that our stock of .22-rimfire ammo is a lot more useful as a store of value and as a means of exchange." | ||
| Posted: 18 Feb 2011 08:17 AM PST Gold and silver seemed to be responding to the stress.... With this issue our team is celebrating two important anniversaries in anticipation terms. Exactly five years ago, in February 2006, the GEAB N°2 suddenly encountered worldwide success by announcing the next "Triggering of a major global crisis" characterized especially by "The end of the West as we have known it since 1945". And exactly two years ago, in February 2009, in the GEAB N°32, LEAP/E2020 anticipated the start of global geopolitical dislocation phase by the end of that same year. In both cases, it is important to note that the undeniable interest aroused by these anticipations at international level, measurable particularly by millions of people reading the related public announcements, has been matched only by mainstream media silence over these same analyses and the fierce opposition (on the internet) of the vast majority of economic, financial or geopolitical experts and specialists. Official unemployment rates (12/2010) – Source: BMGBullion, 01/2011 However, in early 2011, most of the world has no doubt that we are engaged in a process of historic proportions which is seeing the world after 1945 collapse before our eyes, the US in the lead, while the international community breaks down a little more each day, like the social and economic fabric of most countries in the world (1). But the current evidence didn't, of course, prevent "decision-makers and experts" (2) to be sure in 2006 that there was no risk of a serious crisis on the horizon and, in 2009, that it was absurd to imagine the slightest risk of breakdown in the existing world order, let alone the social order. Alas, today, the elite's intellectual capacity to cope with the changes currently taking place doesn't seem to have improved since the same "decision-makers and experts" never imagined it possible just two months ago that Tunisia and then Egypt would shortly see their regimes overthrown. Blind governments and international institutions (3), outdated experts and media (4) ... the Western elite and their clones in different regions of the world continue to sink in the "holzweg" of history, those forest trails that lead nowhere, or more precisely as Heidegger pointed out, that lead somewhere only if you have the humility to be constantly listening to the forest and its signals (5). However, whilst the signals become real warning sirens, our elite seem to have decided to do anything and everything to ignore them. Take a very recent example: the comparison of events affecting the Arab world with the fall of the Berlin Wall. Our team has been very interested to note that this image which we have used since 2006 to help understand the ongoing process of the disintegration of US power, has now blithely been taken up by the political leaders (led by Angela Merkel (6)) and experts of all kinds. Yet today, even those who make this comparison abstain from continuing their intellectual journey to the end, until it leads to an understanding of the dynamics of events. They settle for describing, without analyzing. Yet this "wall" which is collapsing has been built by someone, or something, and for a specific purpose. The "Berlin Wall" was built by the East German government in the broader context of the "Iron Curtain", which the USSR wanted in order to separate the Communist bloc from the West as tightly as possible. And it was mainly to avoid any questioning of the power held by the single party in each communist country to perpetuate Moscow's control of the East European countries; in return, Moscow guaranteed full support and stipends of all kinds to the leaders of Eastern European countries. The fall of the "Berlin Wall", challenging these monopolies of power and therefore the purposes that they served, thus caused, in a few short months, the successive fall of all the Eastern European communist regimes, ending two years later with the dissolution of the USSR and the end of seventy years absolute power of the Russian Communist Party. Unemployment rate in the Arab world and Iran - Source: Le Temps, 02/11/2011 So if it's also a "wall" that's falling before our eyes in the Arab world, in order to hope to anticipate the subsequent events it is essential to be able to answer these questions: who built it? for what purpose? And the answers are not that difficult to find for those who don't watch the news with ideological blinkers: . this "wall" was built by each Arab dictator (or regime) of the region to ensure their continued monopoly on the power and wealth of the country, avoiding any calling into question of their single party or dynastic legitimacy (for the kingdoms). In this sense, there is very little difference between the cliques in power in the Arab countries and those which led the communist countries. . this "wall" was part of the broader system set up by Washington to preserve their preferential access (in US Dollars) to the region's oil resources and protect Israel's interests. The forced integration of the military and security apparatus of these countries (except Syria and Libya) with the US defence system ensures (ensured) unwavering US support and allows (allowed) the Arab leaders involved to receive all kinds of stipends without being called into question by internal or external forces. So, in thinking a little more about her comparison with the fall of the Berlin Wall during the Munich Security Conference, the German Chancellor could have turned to her neighbour in the discussion, the US Secretary of State Hillary Clinton, and asked her: "Don't you think that current events in Tunisia and Egypt are the early signs of the fall of all the regimes that depend on Washington for their survival? And that, in particular, they can lead to a rapid collapse of the system supplying oil to the United States set up decades ago? And thus the global system for oil billing and the central role of the Dollar here (7) ? Whilst the Munich Security Conference audience would have suddenly realized that they were finally discussing something serious (8), Angela Merkel could have added: "What about Israel? Don't you think that this fall of the "wall" will involve the need to reconsider the entire US-Israeli policy in the region very quickly (9) ? And then miraculously, the Munich Security Conference would have regained a foothold in the XXIst century and the Euro-American debate could recharge its batteries in the real world instead of rambling in the transatlantic virtual world and the fight against terrorism. Sadly, as we all know, this exchange didn't take place. And the ramblings of our leaders are, therefore, likely to continue with the effect of accentuating the shocks of 2011 and its ruthlessness as GEAB No. 51 anticipated. Annual relative performance of 40 asset classes (in %, expressed in USD) (in green: profit / in red: loss) - Source: Chris Martenson, 02/04/2011 Yet LEAP/E2020 is convinced that the current events in the Arab world, of which we had correctly anticipated the mechanics, are above all the regional translation of fundamental trends of the global systemic crisis, and in particular global geopolitical dislocation (10). As such, they are evidence of major shocks in the coming quarters. We consider, in particular, that the end of 2011 will be marked by what our team calls the "Fall of the petro-dollar Wall" (11) that will immediately generate a major monetary-oil shock for the United States. It is also one of the main topics of this issue with the broader anticipation of more developments in the Arab world (including an accurate country risk indicator for the region). Also, our team analyzes the current acceleration of the Eurozone emergence process and its implications for the Euro and the situation in Europe. Finally, we give our recommendations regarding all these events. http://www.leap2020.eu/geab-n-52-is-available-global-systemic-crisis-world-geopolitical-breakup-end-of-2011-fall-of-the-petro-dollar-wall-and_a5927.html  | ||
| 6 Charts Which Prove That Central Banks All Over The Globe Are Recklessly Printing Money Posted: 18 Feb 2011 08:06 AM PST 
Right now you can almost smell the panic as it rises in global financial markets. Investors all over the world are racing to get out of paper and to get into hard assets. Just about anything that is "real" and "tangible" is hot right now. Gold hit a record high last year and it is on the rise again. In fact, it just hit a new five-week high. Demand for silver is becoming absolutely ridiculous right now. Oil is marching up towards $100 a barrel again. Agricultural commodities have exploded in price over the past year. Many investors are even gobbling up art and other collectibles. Paper money is no longer considered to be safe. All over the globe investors are watching all of the reckless money printing that has been going on and they are becoming alarmed. An increasing number of investors and financial institutions are putting their wealth into hard assets that are real and tangible in an effort to preserve their wealth. The other day, a reader of this column named James sent me some charts that he had put together. I thought they were so good that I asked him if I could include them in an article. These charts show how central banks all over the globe have been recklessly printing money. Over the last 30 years virtually the entire world has developed a great love affair with fiat currency.... So is everyone printing money? The U.S. is printing lots of money.....
The Bank of England is printing lots of money.....
The EU is printing lots of money....
Source: The ECB Japan is printing lots of money.....
China is printing lots of money.....
Source: The People's Bank of China India is printing lots of money.....
Of course anyone with half a brain can see where all of this is ultimately headed. In the end, inflation is going to spiral out of control and we are going to witness financial implosion on a global scale. So why don't these nations just adopt sound money? Well, it turns out that if you are a member of the IMF, you are specifically prohibited from having gold-backed currency. Yes, you read that correctly. In fact, U.S. Representative Ron Paul once sent an open letter to the U.S. Treasury and the Federal Reserve asking about this and he received no response. The following is the content of that letter....
Sadly, the truth is that the global elite don't want nations to start adopting gold-backed currencies. They want countries to use fiat currencies that they can openly manipulate for their own benefit. At this point, every nation on earth (to the best of my knowledge) uses a fiat currency. All of the major global currencies are being continually devalued. In fact, there are times when counties will purposely devalue their currencies even more rapidly in order to gain a competitive advantage in world trade. This is why so many investors now have such an aversion to paper currency. It starts losing value the moment you take possession of it. In some areas of the world, "gold fever" is absolutely exploding. For example, China imported five times as much gold in 2010 as it did in 2009. On the Shanghai Gold Exchange, trading volume soared 43 percent during the first 10 months of 2010. Gold, silver and other precious metals are now seen as a great hedge against inflation worldwide. Investors all over the globe are demonstrating a strong preference for "real money" over "paper money". So what does all of this mean? It means that some tremendous imbalances are being built up in the global financial system. The central banks of the world must continue to inflate these bubbles with constantly increasing amounts of paper money and debt in order to keep the game going. If at some point the reckless money printing comes to a screeching halt it is going to unleash hell on global financial markets. But if all of this reckless money printing continues we are eventually going to see horrific inflation all over the planet. In fact, we are already seeing significant inflation happening in many areas of the globe. Almost every single day a new headline about inflation in China seems to pop up in the financial news. Rising food prices are sparking unrest in the Middle East and elsewhere. Even U.S. consumers are starting to see some uncomfortable price increases at the gas pump and in the supermarket. So it is not just Federal Reserve Chairman Ben Bernanke that is off his rocker. The whole world is going crazy with money printing. Hopefully this whole thing is not going to end as badly as many of us fear that it will. But right now the central banks of the world are pumping unprecedented amounts of cash into the global financial system, and those in the global financial system are funneling a very large percentage of that cash into hard assets. Unless something changes, that is going to mean that prices for basic necessities such as food and gas are going to continue to rise. This is quite a fine mess that we are in. Does anyone see a way out? | ||
| Playing Jim Rodger's Picks With ETFs Posted: 18 Feb 2011 07:57 AM PST Tom Lydon submits: Are you an exchange traded fund (ETF) investor worried about how our country's loose monetary policy could affect the economy? Then you may want to listen to the advice of investment guru Jim Rogers. Sitting down with Judge Andrew Napolitano on Investment Postcards, venture capitalist Jim Rogers discusses his take on how to profit in times of reckless monetary policies. Rogers remarked that "[Federal Reserve Chairman Ben] Bernanke, he does not understand finance, economics and currencies; all he understands is printing money and now that we have given him the printing presses, he has run those printing presses as fast as he can." [Silver Complete Story » | ||
| Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Over 2% and 7% on the Week Posted: 18 Feb 2011 07:12 AM PST Gold climbed $4.69 to $1388.39 in Asia before it fell back to $1381.25 in London, but it then climbed to a new session high of $1391.75 in New York and ended with a gain of 0.3%. Silver saw modest gains in Asia and London before it accelerated markedly higher in New York and ended near its late session high of $32.86 with a gain of 2.76% at a new 30-year high. | ||
| Michael Victory – Don’t Squeeze The Silver Posted: 18 Feb 2011 06:58 AM PST Don't Squeeze The Silver
The ESF In GATA (2000), Howe notes that unexplained losses were appearing in the ESF's quarterly reports to Congress in quarters when gold prices went up, while profits were earned in quarters when the gold price fell. The result was probing because, the Treasury both in the public statements and letters response to queries, maintained that no interventions in the foreign exchange markets were taking place. Howe explains, "There were no other obvious activities that might explain these losses." He concluded the ESF was intervening in the gold and silver market. Foolish Games In February of 2001, the Federal reserve began covering it's tracks, not only dropping all reference to the ESF in future U.S. Reserve Assets reports, but going back and changing already published reports (Turk & Rubino, 2004). Not only were the figures changed, but all previous references to the ESF were eliminated. Why? Silver and big brother gold, together are yardsticks by which the world's currencies, and the central banks that manage them are measured. When a precious metal's exchange rate is low relative to a currency, the central bank appears to be doing a good job of keeping inflation down and the value of their fiat currency up. If a bank can keep precious metals undervalued they can make their currency look nice. So Small ~MV GATA. (2000). Gold Anti-Trust Action Committee. Retrieved from http://www.gata.org/node/1179 Turk, J., & Rubino, J. (2004). The coming collapse of the dollar. New York, NY: Random House. | ||
| Silver in Breakout Mode but Silver Shares Lag Posted: 18 Feb 2011 05:20 AM PST Last we checked, Silver was trading at $32.53/oz. It is higher by more than 2% today after its breakout yesterday. All is good and merry right? While Silver has surged in recent days and weeks, the silver stocks have lagged tremendously. In the chart below we show SLV and the SIL/SLV ratio. SIL is an ETF for large-cap silver shares. Note the strong relative performance of SIL (evidenced by the rising SIL/SLV ratio) in the months leading to the breakout in September. We see a different picture now. SIL is 10% off its December high while SLV is now 4% above its December high.
Whether it is Silver, Gold or another commodity, we like to see the shares perform well prior to and into a breakout. In this case, Silver is trading at a new high but the vast majority of the shares have not followed suit. What are our targets for Silver? What will happen to the shares? That is for premium subscribers only. So consider a free 14-day trial to our premium service! Good Luck! Jordan Roy-Byrne, CMT Jordan@TheDailyGold.com
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When there isn't enough of X and excess demand exists for X, the price of X rises. The casino aggravates the cycle, and things can get wild when those betting against X's rise decide to get out of their bets. To suggest that JPM and others aren't sitting at the table with big bets against silver is silly. Nothing new really, the game has been going now for a hundred years.
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