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Gold World News Flash

All Paper is STILL a short position on gold
Investment Legends: Dollar Collapse Inevitable
Why Gold Is No Longer an Effective USD Hedge
Proof That Gold Is Not a Bubble
Why Central Banks of the West Hate Gold
Gold Seeker Closing Report: Gold and Silver Rise To New Highs
Goldman's Magnum Opus On The Economic Impact From Japan's Earthquake
Gold and Silver, Look at the Big Picture
Guest Post: I've Got a Funny Feeling About the Stock Market
At King World News, Turk and Embry prepare for metal's big move
The Silver Price Broke Out Today
Readers Pick Doug Casey's Brain - Part 2
Investment Legends: “Dollar Collapse Inevitable”
Silver Cuts New Highs, Vulture Updates
Mad Dog Gaddafi's Gold of Mass Destruction
Precious metals portend dollar panic ahead
Embry - Breakaway Move Coming in Gold, Oil $150 to $200
Back when I was already 90% invested in gold and silver
Purchasing Power Buckles Under Government Spending
Yen action sets scene for return of carry trade
LGMR: Gold Seen Nearing Cyclical Peak, Rises as Dollar Gains Amid New Euro Debt Fears
The SLA has $50 in its sites. GIABO the most successful world revolution in history . . . and it’s got more than $450 to go!!!!
1 billion Zynga dollars = 1/1000th Oz. of Gold so Foursquare is worth -
Gold futures notch record high
Silver, gold gain on fast-changing global events
Precious Metals – The Supply and Demand from Japan
Hourly Action In Gold From Trader Dan
In The News Today
Jim?s Mailbox
Gold’s Clear Message

All Paper is STILL a short position on gold

Posted: 23 Mar 2011 08:23 PM PDT

FoFOA

Investment Legends: Dollar Collapse Inevitable

Posted: 23 Mar 2011 07:08 PM PDT

Casey Research

Why Gold Is No Longer an Effective USD Hedge

Posted: 23 Mar 2011 07:00 PM PDT

Sk Options Trading

Proof That Gold Is Not a Bubble

Posted: 23 Mar 2011 07:00 PM PDT

Fool.com

Why Central Banks of the West Hate Gold

Posted: 23 Mar 2011 04:23 PM PDT

For further market analysis and commentary, please see Trader Dan's website at www.traderdan.net

Dear CIGAs,

I wanted to post some brief comments to let some of the newer readers understand why many of us believe that there is a war being waged upon gold by the Central Banks of the West.

Let me start this off by quoting from none other than former Fed Chairman Alan Greenspan more than 40 years ago:

In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. … This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard

What the former Fed Chairman was then saying was that absent a gold standard or some device for restraining the unlimited creation of fiat money, there was nothing to impede monetary officials from engaging in such activity to the extent that it would ultimately set in motion a process of inflation, which is really just another name for the erosion of the purchasing power of a nation's currency by debasing it. Inflation was and is in essence, the transfer of wealth from one class to another.

Today we have the Fed engaging in the very process that Greenspan warned against back then. We also have the BOJ and the ECB effectively doing the same thing to an extent.

Unlike Silver, Gold is the main metal that most analysts and commentators look to when attempting to decipher whether or not inflation is a serious problem. That means the reference point of gold has become a target for Central Banks which want the world to believe that they can create unlimited amounts of funny money with absolutely ZERO impact on inflation levels. In other words, that they can conjure up wealth and produce prosperity with the electronic equivalent of a printing press and produce no serious inflationary impact by so doing.

A rising gold debunks their hubristic assertions to the contrary for it stands as a silent witness testifying against them. This is the reason the yellow metal is despised by so many Central Banks. It mocks their policies and displays their folly for all the world to see. Central Bankers, being the demigods that they are, will tolerate no rivals to their claims of economic omniscience. You see they have actually come to believe that it is their own wisdom and foresight which enables them to see through the fog that hinders and impedes our economic progress and that they are in a unique position to provide the rest of us with lasting prosperity. They attempt to do this by basically providing or withdrawing liquidity as they in their wisdom judge best and by the setting or manipulation of interest rates.

Those of us who believe that it is free market capitalism and the industry and efforts of mankind that produce wealth and prosperity would beg to differ but that is another story altogether. I would add that it is my opinion that the world would be better off without this plague of locusts that actually devour a nation's wealth but the fact is that they are here.

While they are here gold will attempt to move in such a manner that it either blesses or curses their policies. Now we all would love to have our policies approved by the vote of the market but what about those times in which the market frowns on our course of action and refuses to smile upon it? Why this is but a simple matter – attack the messenger! If one can somehow manage to keep the price of gold under wrap so that it does not move sharply higher then one can attempt to make the claim that inflation is not a serious problem. The comments usually go something like this:

"Well Jerry, we are looking at the gold price and from what we can see, that while it is definitely higher, it is not soaring out of control. The market may be pricing in some gradual inflation but the action in the gold price is telling us that any fears of inflation getting out of control are definitely unwarranted. Besides, we all agree that some inflation is a good thing because the alternative is deflation and no one wants to see that".

Imagine Fed Chairman Ben Bernanke testifying before Congress saying that the current rise in prices of many goods is only "temporary" and "relatively modest" if the gold price were soaring beyond $1650 and higher! Do you think anyone would take anything that the Chairman said seriously? Copper can soar higher and most will not notice it. Even if it does, it is generally explained as a positive because we are told it is a sign of strong economic growth ahead. Crude oil and energy prices can rocket higher and that can be attributed to geopolitical unrest among oil producing nations. Food can rise sharply and everyone notices that but such things are often explained away by citing weather conditions, supply constraints, etc. but a rising gold price? How does one explain that away?

The only reason that gold has a sustained price rise is because of a lack of confidence in the monetary system. It does not rise sharply because of such things as jewelry demand or industrial demand – it rises when fear, distrust, doubt, suspicion and uncertainty over Central Bank policy reigns. It rises when REAL interest rates are negative and investors understand the insidious process of currency debauchment practiced by these monetary authorities is underway. It thus cries aloud and issues a warning to those who can hear it and what it shouts displeases many Central Bankers because they are among those who while they despise its message, are all too keenly able to hear that message.

Thus the messenger, the prophet, the oracle, must be silenced or at the very least, his message blunted, toned down, marginalized, trivialized by whatever means possible. The mechanism employed to do just this is a subject for another time and place. Suffice it to say for now, without the efforts by the monetary officials of the West to discredit gold, it would be trading considerably higher. Even at that however, the ancient metal of kings refuses to go quietly and docilely into the night. It will yet have the final say.

Gold Seeker Closing Report: Gold and Silver Rise To New Highs

Posted: 23 Mar 2011 04:00 PM PDT

Gold climbed $13.74 to as high as $1440.94 by late morning in New York before it fell back off a bit in the last few hours of trade, but it still ended with a gain of 0.74% and made a new record closing high. Silver climbed to a new 31-year high of $37.243 at about 1:15PM EST and ended with a gain of 2.29%.

Goldman's Magnum Opus On The Economic Impact From Japan's Earthquake

Posted: 23 Mar 2011 01:16 PM PDT

Goldman's Dominic Wilson has just released his magnum opus analysis on the situation in Japan and its aftermath. Unlike the lunatic drivel disseminated each and every week by GSAM's Jim O'Neill, which would interpret the imminent collapse of the Earth into a neutron star as the most bullish event in the (soon to be over) history of mankind, this report is actually one of more biased we have read from the Goldman strategists. That said, the natural bias to spin everything in a positive light still dominates the report (to which we retort: why not just blow up unpopulated pieces of America and rebuild them over and over: it does miracles for the Chinese "GDP" - it should work just as well in the US - plus Krugman would be in a constant state of Keynesian extasy). We obviously disagree: never before has there been the added precedent of nuclear fallout, or a pyschological intangible, to the mostly superficial infrastructural repairs that have to be undertaken. Goldman does acknowledge this as follows: "The ongoing nuclear risk at Fukushima has the potential to magnify the impact in other ways, although at the time of writing these risks seem to be fading." Based on what? Manipulated data reporting out of Japan, TEPCO and everyone else who is either guilty of strategic mismanagement, or is desperate to avoid a worldwide panic. It is this type of rushing to conclusions based on a complete lack of facts, that drives objective market observers furious with blind rage at the idiocy of the authors (and yes, "idiots" is what Sean Corrigan called all those who only see the upside in the Japanese catastrophe and ignore the massive human, economic and financial downside). Yet for all those who can bottle their rage for 15 minutes, we recommend reading the enclosed report as it is the very best that the Kool Aid crowd can serve at this point. Which, when applying some common sense, is not very much.

From Goldman Sachs

The Economic Impact of Japan’s Earthquake

As markets assess the impact of the recent tragic earthquake and tsunami in Japan, we attempt to place this issue into a broader perspective. While there can be no perfect analogue in such a disaster, studying previous ones may provide a sense of the probability distribution around the macro and market impacts of such events, and their trajectory.

Natural disasters tend to result in a strong contemporaneous reduction in average GDP growth followed by a quick rebound in the following quarter. Even in the case of very large disasters (in a ‘global’ rather than ‘local’ sense), the impact on economic growth fades quickly from the data, in part because in most (but not all) cases the boost from government spending offsets the fall in activity in other parts of the economy. The impact in asset markets has generally been more muted than the economic impact.

That said, the impact of the East-Japan earthquake and tsunami may be greater. This is likely to be one of the most costly disasters in global GDP terms; the ongoing nuclear risk has the potential to magnify the impact in other ways; power disruptions could last longer than normal; and supply chain disruptions may be an issue. While our Japan forecasts are under review, we are not planning any significant changes to our global forecasts.

From a global markets perspective, the broader macro context is important, and at the margin, positive. The Middle East crisis remains a key source of uncertainty. But data is likely to confirm global cyclical strength, European sovereign risks have calmed a little, and there are tentative signs that the most intense EM tightening phase may pass.

We extend our deepest sympathy to all those whose lives have been affected by the recent East-Japan earthquake.

As markets assess the impact of the recent catastrophic East-Japan earthquake and tsunami, in this week’s commentary we try to place this issue into a broader perspective. While there can be no perfect analogue in such a disaster, studying previous large disasters may help to gain a sense of the probability distribution around the macro and market impacts of such events, and their trajectory.

Natural Disasters in History

We have focused on three types of disasters (earthquakes, floods and storms) that are similar in nature: exogenous shocks with immediate destructive impact. We obtained disaster data from the EM-DAT International Disaster Database provided by the Centre for Research on the Epidemiology of Disasters (CRED). Over 6,612 disasters of these types have occurred since 1980, so we narrowed our sample by focusing on those in which the estimated direct economic damage (to buildings, production facilities, etc.) was greater than 1% of the preceding year’s GDP. We also eliminated disasters in countries without sufficient macroeconomic data available during the crisis period. This leaves us with a sample of 40 disasters in 23 different countries, nine of which occurred in the developed world (DM) and the remaining 31 in emerging market (EM) countries. Some familiar recent disasters in this group include the Hanshin earthquake in Kobe, Japan (1995), Hurricane Katrina in the US (2005), and the Indonesian earthquake and tsunami (2004).

Earthquakes are by far the most destructive in terms of both human impact and direct economic damage. The human impact is much larger in natural disasters in EMs, where nearly three times as many people are affected. But the direct property damage (relative to GDP) is much larger in the developed world, likely because there is a more valuable capital stock already in place when disasters strike. Table 1 contains some basic summary statistics about the magnitude of these crises, as measured by the estimated property damage and the number of people affected and/or killed by the disaster.

A Short-Lived Hit to Growth on Average

In order to explore the short-term economic impact of a large-scale natural disaster, we looked at quarterly and (where available) monthly data for a range of economic and market variables. Looking at averages does, of course, mask a great deal of variation, but some clear lessons still apply.

Turning first to GDP, we find two main results:

Natural disasters result in a strong contemporaneous reduction in average GDP growth followed by a quick rebound in the following quarter. Sequential growth is reduced by an average of approximately 3ppts (annualised) in the quarter in which the disaster occurs, although this result is driven mainly by EMs. Output falls by an average of 0.55ppts below its pre-disaster trend before rebounding nearly all the way back in the next quarter.
More destructive disasters produce a larger hit to growth. The size of the one-quarter hit to growth is strongly and negatively correlated with the size of the natural disaster on all three of the measures presented in Table 1.

The short-lived impact on economic activity is also confirmed by a range of other variables and is consistent with recent academic studies. Sequential IP growth falls sharply in the disaster month but then rebounds in the subsequent month. Export and import growth also both fall, in line with the overall reduction in output growth, before recovering in the next quarter. Investment growth dips but then accelerates strongly in the next 1-2 quarters, which suggests that the rebuilding of destroyed capital stock is an important component of post-disaster GDP resilience.

Policy rates tend to be reduced marginally on average, although this response generally is delayed until a few months after the disaster and there is a large degree of variation across cases. Equity returns dip in the month of the disaster but remain firmly in positive territory (at around 1%mom non-annualised on average), and then rebound sharply in the next month. Disasters have historically had a negligible impact on average on the short-term dynamics of inflation, government budget deficits and either nominal or real TWI exchange rates.

The Largest Global Disasters Tell a Similar Story

In addition to the lessons from the aggregate sample of disasters considered above, it is also helpful to look more closely at some of the globally most expensive disasters in recent history—since they are likely to provide the closest analogue to the East-Japan earthquake and tsunami. We sorted our sample of disasters by the estimated damage as a percentage of global (rather than local) GDP and, on this basis, the big five in descending order are the Hanshin (Kobe) earthquake of January 1995, Hurricane Katrina in August and September 2005, the Irpinia earthquake in Southern Italy in November 1980, the Sichuan earthquake in China in May 2008 and the earthquake in Los Angeles in 1994. The damage in each of these disasters exceeded a tenth of a percent of global GDP in that year (see Table 2). Restricting the sample in this way results in a sample biased towards the large advanced economies (with the exception of China in 2008). On the other hand, these are not among the most severe disasters within the context of local GDP, as Table 2 also shows.

The conclusions from looking at these big five disasters are qualitatively very similar to the results of the full sample. But the scale of economic and market moves in these cases may provide a better reference point for the East-Japan earthquake compared with the EM-heavy sample analysed above:

Even in the case of these large disasters in a ‘global’ rather than ‘local’ sense, the impact on economic growth fades quickly from the data. Notwithstanding the intense human and social costs of such large global disasters, the economic cost barely registers in quarterly economic data. In all four cases with available data, GDP growth was positive in the quarter in which the disaster happened. Output subsequently returned to its pre-disaster trend within one quarter, with the exception of the Chinese Sichuan earthquake of 2008 (although this likely reflects the concurrent global downturn).
The impact of the disaster is more clearly discernible in monthly activity data. Industrial production is the most reliably available across countries and over time. In the case of the Hanshin earthquake in Kobe, Japanese industrial production fell -2.6% mom in January 1995, but positive growth (+2.2%) was restored in the very next month. For the three months after the January earthquake, IP growth in Japan averaged 1.5%mom, double the average of the three months prior to the earthquake. And industrial production was above pre-earthquake levels within two months, by the end of March. In the case of Hurricane Katrina in 2005, IP growth was flat in August and down -2% in September, but growth was positive in October, and the pre-hurricane level of industrial production was surpassed by the end of November. The other three episodes were even less impactful: IP growth dipped to 0.5%mom in the month after the LA earthquake, and was low but positive in the months of the China and Southern Italy earthquake. Of course, the economic impact is greater if one zooms in on the region most directly affected by the natural disaster. For example, large-scale retail sales in the Hyogo and Osaka area fell sharply over the January-March 1995 period (-6.7%yoy, -3.4%yoy and -1.7%yoy). But even here, there was positive growth by April, and after drifting sideways for much of the rest of the year, large-scale retail sales rebounded strongly in January-March 1996.
Part of the reason that growth recovered quickly is that in most (but not all) cases, the boost from government spending offsets the fall in activity in other parts of the economy. In three of the five large episodes—the Hanshin Earthquake, the Southern Italian earthquake and Hurricane Katrina—government spending grew strongly in the quarter when the natural disaster occurred or in the quarter just after. The contrast is especially clear in the case of the Hanshin earthquake in Japan. In 1995Q1, real GDP grew 0.8%qoq, within which both private consumption and investment spending fell, but government spending increased by 2.8%qoq.
From a markets perspective, the impact has generally been even more muted than the economic impact. We only find a clear impact on equities in the largest disasters, the Hanshin earthquake and Hurricane Katrina, and in general there are few if any persistent moves in rates and FX markets. In the case of the Hanshin earthquake, the Nikkei 225 fell about 8% in the week following the disaster, but it soon rebounded and had recovered more than half its losses in the week thereafter. Bond yields (and the Yen) barely moved over this period, and continued a sustained downtrend, largely owing to the gradual economic slowdown in the quarters thereafter.

Key Differences with the East-Japan Earthquake

The evidence from historical disasters is helpful to gain a sense of the probability distribution around possible economic outcomes and their likely trajectory. But there are unique features of the East-Japan earthquake and tsunami currently, most of which suggest that the impact may be greater. We highlight five key points:

Even as the full extent of the damage in the East-Japan earthquake and tsunami is being assessed, it is already clear that this is likely be one of the most costly disasters in global GDP terms. According to the estimates by our Japan economics team, the total damage will be about ¥16trn, or around 1.6 times greater than the Hanshin earthquake, which was the most costly disaster before this in our sample.
The ongoing nuclear risk at Fukushima has the potential to magnify the impact in other ways, although at the time of writing these risks seem to be fading. A significant nuclear risk event, apart from the negative impact in the immediate affected area, is likely to affect consumer sentiment more broadly in Japan and potentially in other countries too. So the second round of economic impact from these types of developments could be significant. The nuclear dimension has also added a channel for international contagion as countries such as Germany have accelerated the shutdown and review of certain ageing nuclear power plants, putting more pressure on gas and oil prices, with the consequent deleterious effects on growth.
A prolonged disruption to the power network in Japan is a significant risk to Japanese growth and a material difference from many previous large disasters where power disruptions were mostly limited and local. The situation is evolving daily but damage from the earthquake has caused a shutdown of about 10%-12% of power station capacity throughout Japan. If power outages do not extend beyond end-April (our current base case), then after a contraction in 2011Q2, we expect +2% growth in Q3—a pattern not dissimilar to the historical evidence. However, if in a worst-case scenario, power disruption persists into late summer or even to end-December, our Japan economists estimate that GDP could decline until the end of the year.
Although the affected regions are somewhat further removed from Japan’s industrial heartland relative to the Hanshin earthquake, the fact that Japan is such a key part of the global industrial supply chain means that disruptions in specific industries and output could be material. Our equity analysts believe that sectors where there is likely to be a significant impact on sales include semiconductors, cellphones, digital cameras, petrochemicals and autos, whereas they see a relatively smaller impact on the machinery and steel sectors (Assessing earthquake impact risk on production in key industries, Shin Horie, March 21, 2011). Mike Buchanan and team have combined this micro industry level data with country trade linkages and see modest downside risks to growth in Singapore, Taiwan, Thailand, the Philippines and Korea, but little impact on China or India. A key mitigating factor is that in many industries inventories are sufficient to meet component demand for around six weeks. Still, disruption that lasts much longer will mean more risks of a kind that a purely ‘macro’ perspective may miss.
Lastly, part of the reason why the typical economic growth impact from natural disasters is fairly short-lived is the offsetting boost from government spending. We expect this offset this time around too. Chiwoong Lee’s latest note (Japan Economic Morning Pitch: ‘Financing Earthquake Reconstruction Still Uncertain’, March 22) lays out some of the options currently being considered in the media: (i) using the FY2010 and FY2011 emergency funds (¥1.2trn together), (ii) revising the FY2011 DPJ manifesto (¥3.3trn in total), and (iii) using government reserves (¥2.5trn). What cannot be covered by these sources will require increased issuance of new JGBs, but the scope for policy flexibility is more restricted today at least relative to the 1995 Hanshin earthquake. In 1995, interest rates were still above 3% and the size of the fiscal deficit was smaller (92% of GDP) than it is today (221% GDP). Japanese financial conditions have tightened since the earthquake, though the joint intervention on the JPY by major central banks has provided an important interruption to that dynamic.

Our Japanese forecasts are currently under review, although the key uncertainty around the growth picture centres around the longevity and magnitude of power disruptions. Reflecting the downside risks to earnings, Kathy Matsui and our Asian Portfolio Strategy team have already shaved 12% off their FY2012 earnings estimate for Japan’s equity markets, and we now expect returns here to be more back-loaded.

At this stage, we are not planning any significant revisions to growth forecasts outside Japan, although any changes there would mechanically influence the global forecast. The impact through export channels from temporarily lower Japanese demand is likely to be relatively small, even in non-Japan Asia where the linkages are tightest. And the other main source of transmission—through global financial conditions—is so far not registering as significant.

From a Global Markets Perspective, the Broader Macro Context is Mostly Constructive

While the earthquake has dominated headlines, it is important to keep an eye on other key developments that have occurred over the last two weeks in assessing the broader context in which these impacts are playing out.

Alongside the Japanese disaster, the other source of ‘headline’ risk for markets in recent weeks has come from developments in the Middle East. Here too, we have seen significant news lately. Gulf forces have entered Bahrain and protests continue both there and in Yemen. In addition, a UN Security Council resolution authorising a no-fly zone and escalating sanctions against Libya have already resulted in military strikes against government forces. In both cases, this could set the stage for greater stability in the region. But it is still difficult to be sure exactly what paths the regional crisis will take and interventions so far do not provide a decisive resolution. This is therefore a source of uncertainty that may remain with us even if concerns over the consequences of the Japanese earthquake subside.

The major transmission to the broader outlook remains through oil supply disruptions. We have had a structural view that oil prices are likely to be under upward pressure in 2011. For this reason, we have generally sought out energy exposure, directly and within equities and FX. Disruptions to nuclear capacity in Japan may ultimately reinforce those structural pressures. But our central forecast remains that the upward trend in oil prices will not prove to be a binding constraint on growth. That said, further supply shocks would certainly see fresh spikes in oil prices given low inventory buffers, so we remain vigilant about this source of risk. Our ‘oil-adjusted’ Financial Conditions Index in the US—a simple way of weighting the impact of financial conditions and oil prices on growth—tightened significantly in late February but has so far been fairly stable in March.

Beyond the Middle East, three other developments that are high on our radar screens look a little more benign. The first is the broader cyclical landscape. Last week's Philly Fed release was extremely strong and, as we move through the most macro-intensive part of the calendar, we expect the bulk of the data to reinforce a message of robust underlying growth. While the literal tracking of US GDP growth has been a little softer than our current forecast, the survey data are consistent with stronger underlying growth, so we will likely see some reacceleration in Q2. As we have shown recently (and as displayed in Chart 6), because the growth recovery has been the major story behind the rally since the end of August, the market has generally performed better in the data-intensive part of the month (between the Philly Fed and payrolls), with losses on average outside that period. If our positive growth view is borne out, this pattern could continue, as so far in March.

The second development that has been pushed off the headlines but that we expect to return this week is the continuing push for further measures to calm sovereign fears in Europe. The March 9 European Council meeting was, as we said at the time, a somewhat mixed result that has left many details still to be hammered out. But the fact that a deal was reached early was positive at the margin, as was the upsizing of the European Financial Stability Facility (EFSF) funding and the renegotiation of Greek borrowing terms, even if progress on Portugal and Ireland was more disappointing. And with little fanfare, we have seen Spanish and Italian spr

Gold and Silver, Look at the Big Picture

Posted: 23 Mar 2011 12:39 PM PDT

John Pugsley, author of the highly successful newsletter, The Stealth Investor, is struggling with some sudden health issues. But in this exclusive interview with The Gold Report, he shared his insight on how the global economic situation, including the catastrophe in Japan, is affecting the prospects for precious metals-related investments.

Guest Post: I've Got a Funny Feeling About the Stock Market

Posted: 23 Mar 2011 12:39 PM PDT

Submitted by Charles Hugh Smith from Of Two Minds

Guest Post: I've Got a Funny Feeling About the Stock Market

The dollar has reached a point of double-bind for the Fed: push it down further or allow it to rise, it won't matter: either way, stocks will fall off a cliff.

I've got a funny feeling that all the ramp-and-camp, extend-and-pretend POMO games propping up stocks are about to stop working. That would of course trigger a long, deep slide in equities, because as we all know, it's the Federal Reserve's games which have goosed the market to its current lofty heights. The market's confidence in the Bernanke Put--that is, the belief that the Fed will never let stocks decline-- remains supremely undimmed.

A lot of very good technical analysts see sentiment reaching lows which usually mark market bottoms. I am not so sure about this interpretation, for the investors intelligence readings are still complacently bullish.

Other very good technical analysts haven't yet seen a break in the long-term uptrend, so they too have reservations about any real decline.

Various Wall Street analysts are predicting a "mild correction" of 7% to 10%, after which it's off to the races once again--a pause that refreshes the permanent Bull.

I've got a funny feeling that it's lose-lose time for the Fed's games. here's the basic game plan: inject tens of billions of free money into the "risk trade," i.e. equities and commodities, ramp the futures markets when volume and liquidity are low, and crush the U.S. dollar.

It's practically a perfect inverse correlation: when the dollar tanks, stocks move higher, and when stocks hit bottom then the dollar peaks. Think see-saw: when one tops out, the other hits bottom, and vice versa.

Interestingly, there is a rough correlation with the 40-week (9 month) cycle that many chartists watch. If that holds in the chart of the dollar, then the dollar should rise to a near-term peak in about 8 to 12 weeks. That further suggests stocks will crater.

Notice that the dollar has been driven down to an important inflection point. If the Fed forces it below the 75 level, then that opens the way to 72 and a careening collapse below the line-in-the-sand at 71.

There's an inherent limit to the "drive the dollar down to boost equities" game: inflation, which is already on track to hit 8.3% in 2011 (via Zero hedge).

For there's another see-saw dynamic: the lower you push the dollar, the more all the imports the U.S. depends on cost, generating a loss of purchasing power that is often called inflation.

Here is a simple real-world definition: you pay more for the same (or smaller) goods and (degrading) services than you did in the recent past, though your wages have been stagnant for decades.

Though the Ministry of Propaganda is running full-tilt pumping out statistics that "prove" inflation is near-zero, the recent "you can't eat iPads" heckling of a Fed official reflect the growing disbelief in these official pronouncements.

So here's the lose-lose double-bind: if the Fed continues destroying the dollar, then they will feed the rising-input-costs monster which devours corporate profits like a 10-year old devours Oreos. In a climate where consumers' incomes haven't risen for decades in real terms, passing on higher prices is a non-starter.

So profits will take a hit, and since the market has priced in ever-higher profits, the market will plummet when profits "unexpectedly" decline.

But if the Fed insists on pushing the dollar below 75 in the hopes of pumping up equities, they risk triggering a meltdown of the dollar globally and forcefeeding the rising-input-costs monster until a positive feedback loop kicks in and inflation sinks its teeth into the economy. As noted above, that will destroy corporate profits and thus the stock market's lofty valuations.

I also have a funny feeling about this chart. The NASDAQ, heavily dependent on a few superstars like AAPL and riddled with gaps all the way up from its lows in August, could be topping out not for a few weeks but for years.

The always excellent and provocative Imperial Economics blog of B.C. has published some eye-opening charts which overlay the current bullish utopia with those from previous eras. The sobering conclusion is that if history echoes, then the market is about to roll over in a massive decline that will last a year or two.

As I noted in Sorry, Fed and People's Bank of China: You Can't Have It Both Ways (March 15, 2011), you can't pump up money supply and credit to goose "risk trades" in stocks and commodities without inflating asset bubbles and triggering runaway input-costs, i.e. inflation that destroys profit margins and impoverishes stagnant-wage households.

But if the Fed takes its hands off the game controller and allows the dollar to rise, then equities crash anyway.

In other words, the dollar is at a point where either path leads to stocks crashing. Go ahead and destroy the dollar, and the rising-input-costs monster will gut stocks and impoverish households. Back off and let the dollar rise, and the risk trades (equities and commodities) will plummet.

Take your pick: the result is the same.

Disclosure: I opened a long position in UUP, the U.S. dollar ETF yesterday, and added to my QID short against the NASDAQ 100.

At King World News, Turk and Embry prepare for metal's big move

Posted: 23 Mar 2011 11:45 AM PDT

7:36p ET Wednesday, March 23, 2011

Dear Friend of GATA and Gold (and Silver):

Eric King of King World News tonight cranks up the wattage for Radio Free Markets, interviewing GoldMoney founder James Turk and Sprott Asset Management's chief investment strategist, John Embry, about what may prove to be the big gold and silver breakouts.

Turk notes that silver remains in backwardation despite its rising price. Embry sees $40 silver and $1,500 gold soon and remarks that big things will happen as the bullion banks discover that paper contracts for imaginary metal no longer satisfy investors.

An excerpt of the interview with Turk is headlined "Silver Backwardation Near All-Time Record" and you can find it at the King World News blog here:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/3/23_Ja...

An excerpt of the interview with Embry is headlined "Breakaway Move Coming in Gold, Oil $150 to $200" and you can find it here:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/3/23_Em...

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

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The Gold Standard Now: It Can Work

Today a dollar is worth 80 percent less than it was 40 years ago, and less than 5 percent of its value a hundred years ago. We deserve a dollar that is as good as gold, a dollar that will hold its value from year to year so we can be financially secure and our economy can generate more and better jobs.

For most of America's history, our dollar was literally as good as gold. But on August 15, 1971, our politicians destroyed the link between gold and the dollar. They destroyed the foundations of our economic system.

A new Internet site, TheGoldStandardNow.org, provides news and cutting-edge analysis about this most important issue and explains how the gold standard worked in the past and how it can work in the future. Visit us today:

http://www.thegoldstandardnow.org/about/137-welcome-newsmax

Join GATA here:

An Evening with Bill Murphy and James Turk
Sponsored by Deutsche Edelmetall-Gesellschaft
Friday, April 29, 2011
Hofbrauhaus, Munich, Germany

Support GATA by purchasing gold and silver commemorative coins:

https://www.amsterdamgold.eu/gata/index.asp?BiD=12

Or a colorful GATA T-shirt:

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Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

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Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

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Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit, Extending the Mineralization of the Southwest Vein on the Property

Company Press Release, October 27, 2010

VANCOUVER, British Columbia -- Sona Resources Corp. reports on five drillling holes in the third round of assay results from the recently completed drill program at its 100 percent-owned Elizabeth Gold Deposit Property in the Lillooet Mining District of southern British Columbia. Highlights from the diamond drilling include:

-- Hole E10-66 intersected 17.4g gold/ton over 1.54 metres.

-- Hole E10-67 intersected 96.4g gold/ton over 2.5 metres, including one assay interval of 383g of gold/ton over 0.5 metres.

-- Hole E10-69 intersected 85.4g gold/ton over 4.03 metres, including one assay interval of 230g gold/ton over 1 metre.

Four drill holes, E10-66 to E10-69, targeted the southwestern end of the Southwest Vein, and three of the holes have expanded the mineralized zone in that direction. The Southwest Vein gold mineralization has now been intersected over a strike length of 325 metres, with the deepest hole drilled less than 200 metres from surface.

"The assay results from the Southwest Zone quartz vein continue to be extremely positive," says John P. Thompson, Sona's president and CEO. "We are expanding the Southwest Vein, and this high-grade gold mineralization remains wide open down dip and along strike to the southwest."

For the company's full press release, please visit:

http://sonaresources.com/_resources/news/SONA_NR19_2010.pdf

The Silver Price Broke Out Today

Posted: 23 Mar 2011 11:44 AM PDT

Gold Price Close Today : 1437.90
Change : 10.40 or 0.7%

Silver Price Close Today : 37.202
Change : 0.931 cents or 2.6%

Gold Silver Ratio Today : 38.65
Change : -0.705 or -1.8%

Silver Gold Ratio Today : 0.02587
Change : 0.000464 or 1.8%

Platinum Price Close Today : 1757.30
Change : 17.00 or 1.0%

Palladium Price Close Today : 748.25
Change : 10.35 or 1.4%

S&P 500 : 1,297.54
Change : 3.77 or 0.3%

Dow In GOLD$ : $173.75
Change : $ (0.27) or -0.2%

Dow in GOLD oz : 8.405
Change : -0.013 or -0.2%

Dow in SILVER oz : 324.88
Change : 1.73 or 0.5%

Dow Industrial : 12,086.02
Change : 67.39 or 0.6%

US Dollar Index : 75.93
Change : 0.493 or 0.7%

Sometimes no matter how much you feel like dragging your feet and holding back, you have to cast aside your reservations and follow the technical rules.

I mean that markets are screwy. Stocks should have tanked, silver and gold should have corrected, and the very franticness of these markets keeps whispering in my ear, "Something ugly, something big, is happening where we can't see it." But I can't fight it any longer, and here's why.

First, the SILVER PRICE broke out today, plainly, undeniably, and not for some little piddling move. It closed 3.2% above the previous (9 March 3604.3c) high, at 3720.2c, up 93.1c on Comex today alone.

Next, the GOLD PRICE has reached its 1 March high ($1,437.20). Comex rose $10.40 today and came to rest at $1,437.90. Last missing piece of confirmation is a gold price close 2% above 3 January or $1,451. You'll see that soon enough, unless bottom falls out of silver and gold prices tomorrow.

Meanwhile the Nice Government Men are in Hog Heaven manipulating the yen, euro, and dollar. Dollar index rose 49.3 basis points today, a big move of 0.63%, to end at 75.927. Yen barely moved, up 0.05% to 80.916 yen to the dollar ($123.58 cents to 100 yen). Euro played snooze and lose, down 0.61% to 1.4088. Euro may have left behind an island reversal, but can't tell until tomorrow. (For charts, see www.stockcharts.com, using symbols "$xeu", "$xjy", and "$usd".) Dollar's next move ought to be up, but who can read the minds of Nice Government Men, assuming of course they have minds.

STOCKS began the day hanging their heads and ready to take a guilty beating, but about 12:30 a "friend" came along and took them up to 12,086.02 (up 67.39) and 1,297.54, up 3.77. Today's gain does nothing at all for pulling stocks out of their precarious position. Last 3 days on the 5 day chart look like something from Outer Space, two days practically dead flat, hovering just above 12,000 like snake doctors over a spring.

I don't know anything except I don't want to own stocks. Yes, technically the Dow climbed above its 20 DMA (12,038.04), but that decline from the February high simply does not look complete.

The GOLD PRICE cleared $1,430 resistance about 4:00 a.m. New York time and by NY open had traded up to $1,434. It took a small hit back to test that 1430 resistance ("final kiss good-bye"), then shot straight up to $1,440.90 and traded sidewise the rest of the day. Comex close caught gold $10.40 dearer than yesterday at $1,437.90.

I can't stand in the way of strength like this. I bought gold today, and will buy more tomorrow if it doesn't run away.

SILVER, sweet metal of the moon, you have me utterly baffled, but who dares stand athwart the path of such power?

Once the silver price crossed 3660c resistance about 10:00 a.m. it marched right ahead, pushing through 3700c like John Wayne pushing through swinging doors in a saloon, and its progress never found a check until 3740c. Comex found silver -- with a telescope -- 93.1c higher at 3720.2c.

Gold/silver ratio hit a new low today at 38.65 -- yet another sign of great strength.

Silver seems to have set its mind on reaching 4000c, maybe 4200c or 4400c. Higher, in any event. Higher, against all currents.

Oh, yeah, there will come a day when a panic bites and everybody runs the other way, but not yet. For now the steed has the bit in its mouth and will run away.

Don't forget we need confirmation through higher gold and silver prices tomorrow.

Here's is something yet weightier to think on. On this day March, 1775, to the Virginia House of Burgesses meeting in St. John's Church in Richmond, Patrick Henry spoke to persuade the house to mobilize for military action against the British. The speech is perhaps the most eloquent, most heart-moving you will ever read, filled with echoes of the Scriptures Henry had fed on since his childhood, but not as quotations alien to his matter, but as the warp and woof of life and action and character. Listen:

"It is in vain, sir, to extenuate the matter. Gentlemen may cry, Peace, Peace -- but there is no peace. The war is actually begun. The next gale that sweeps from the north will bring to our ears the clash of resounding arms! Our brethren are already in the field. Why stand we here idle? What is it the gentlemen wish? What would they have? Is life so sweet, or peace so dear, as to be purchased at the price of chains and slavery? Forbid it, Almighty God! I know not what course others may take, but as for me, give me liberty, or give me death!"

Later elected Virginia's wartime governor, Henry seemed four men. His energy, preparations, and activities reached in all directions. But most appealing of all, when he could retire from politics, he gladly did, to spend more time doing what he most enjoyed: romping on the floor with some of his seventeen children.

Small wonder more Americans thought of Henry as the Father of their Country rather than Washington.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com

© 2011, The Moneychanger. May not be republished in any form, including electronically, without our express permission.

To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $3,130.00; silver's primary is up targeting 16:1 gold/silver ratio or $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down. Whenever I write "Stay out of stocks" readers inevitably ask, "Do you mean precious metals mining stocks, too?" No, I don't.

Readers Pick Doug Casey's Brain - Part 2

Posted: 23 Mar 2011 11:30 AM PDT

Author: Doug Casey Synopsis: Welcome to Part 2 of "Readers Pick Doug Casey's Brain," straight from the annual conference of the Prospectors & Developers Association of Canada. Welcome to Part 2 of "Readers Pick Doug Casey's Brain," straight from the annual conference of the Prospectors & Developers Association of Canada. Doug and Louis discuss reader questions, among them: The effects of stock market mergers... Will there be another gold confiscation?... Chinese demographics... The next big trends in science and technology... Special drawing rights (SDRs) as currency?... Is there enough physical gold and silver to actually be used as money? ... and much more. [In today's volatile markets, most investors have pressing questions: Where is the economy going, and how can I make money in this investing environment? How do I protect my wealth from the...

Investment Legends: “Dollar Collapse Inevitable”

Posted: 23 Mar 2011 11:17 AM PDT

Jeff Clark, BIG GOLD What will happen to the U.S. economy and the dollar in the near term? Will inflation increase dramatically? What is the outlook for gold, and where should you put your money? BIG GOLD asked a world-class panel of economists, authors, and investment advisors what they expect for the future. Caution: strong opinions ahead... Jim Rogers is a self-made billionaire, author of the best-sellers Adventure Capitalist and Investment Biker, and a sought-after financial commentator. He was a co-founder of the Quantum Fund, a successful hedge fund, and creator of the Rogers International Commodities Index (RICI). Bill Bonner is the president and founder of Agora, Inc., a worldwide publisher of financial advice and opinions. He is also the author of the Internet-based Daily Reckoning and a regular columnist in MoneyWeek magazine. Peter Schiff is CEO of Euro Pacific Precious Metals (Peter Schiff?s Gold Company | Euro Pacific Precious Metals) and host of the daily...

Silver Cuts New Highs, Vulture Updates

Posted: 23 Mar 2011 11:04 AM PDT

There we were, minding our own business, doing research into our own list of small resource company "faves," convinced we were on the cusp of a super-buying op in the near future. Wouldn't you know it, silver has broken out to new highs. The gold silver ratio falls to new lows. Gold is flirting with its all time highs, but the U.S. fiat dollar catches a bid by default - due to the mess in Portugal and in Ireland coming swiftly back into focus.

Mad Dog Gaddafi's Gold of Mass Destruction

Posted: 23 Mar 2011 10:59 AM PDT

by Adrian Ash BullionVault Wednesday, 23 March 2011 Gold plus Gaddafi – what more sexing up could a story need? Well, quite a bit it would seem... EVEN Alan Greenspan knows that gold is always and everywhere about economic freedom. This isn't a moral point, just a fact. So sometimes, as we told the BBC World Service on Tuesday, it plays to the good of dictators; sometimes it plays to private individuals in terms of personal liberty. Gold enabled Great Britain, for instance, to buy arms and food from the United States during the first two years of WWII. The Pound Sterling's survival was by no means secure, whereas gold bullion – as Sir Alan of Greenspan reminds us – is "the ultimate form of payment in the world." Four decades later, sanctions-busting sales of the Krugerrand helped finance South Africa's apartheid regime, bagging 89% of the world's gold-coin market by 1980. Whereas today, the public in Vietnam is hoarding gold to try and survive the Communist regi...

Precious metals portend dollar panic ahead

Posted: 23 Mar 2011 10:33 AM PDT

by Addison Wiggin
March 23, 2011 (Forbes) — "The precious metals are giving a clear message," says GoldMoney's James Turk, "namely, that the dollar is in trouble. Gold and silver are near their recent highs, and this shows both markets – the dollar and the metals – confirming the trend."

The U.S. dollar index, despite a minor bounce today, remains beneath a low set last November. The greenback can't even catch a break from the PIIGS countries. … The European Union, meanwhile, has put off deciding whether to increase the size of its bailout fund, currently around $624 billion. Result: The euro is up against the dollar, trading right now for $1.414.

"At some point, there is going to be a panic as the flight from the dollar moves from the relatively orderly retreat we are currently witnessing to a stampede. The charts are telling me that panic is about to begin."

[source]

Embry - Breakaway Move Coming in Gold, Oil $150 to $200

Posted: 23 Mar 2011 10:25 AM PDT

With upside moves in gold and silver, today King World News interviewed John Embry Chief Investment Strategist at Sprott Asset Management. When asked about the action in gold and silver Embry stated, "Well my first thought is what took so long? We know what took so long, basically there has been a lot of activity by the bullion banks and their sponsors. But I mean to me it's a very a simple equation, you can screw around with the paper market for a considerable period of time, but as the physical market gets tighter and tighter and this is really demonstrable in silver, I mean that is going to be what sets the price. What goes on in the physical market, when that takes over the prices are going much, much higher than they are today."

This posting includes an audio/video/photo media file: Download Now

Back when I was already 90% invested in gold and silver

Posted: 23 Mar 2011 10:18 AM PDT

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Purchasing Power Buckles Under Government Spending

Posted: 23 Mar 2011 10:15 AM PDT

What if I got right up in your face and told you that there is almost $2 trillion in government debt outstanding on which the government pays no interest? Would you think me insane? Would you look at me skeptically and say to me, "I've told you a thousand times that you are not allowed to make things up just because you don't know what you're talking about, you moron!" or something equally as rude?

Well, I take umbrage at this, as this is one of those times when I am NOT making things up, but I admit that I still don't know what I am talking about.

"But," I say, springing to the attack, "if you are so damned smart, then what happens to the interest that the government is paying on the $2 trillion in government and agency debt that the Federal Reserve owns? Huh? Who? Huh? Who?"

I say this because, so the story goes, the Fed is not allowed, as a private bank, to profit from creating money, nor, I would say, from the ownership of the government bonds that it bought with money it created.

And so the Fed, every year, remits all the money it gets back to the Treasury, except for a few billion in fees, charges, expenses, overhead, commissions, bonuses, additions to the petty cash accounts, and (probably, under "miscellaneous expenses") kegger parties with strippers.

And as a guy who has gotten stuck with the check for a blow-out kegger party, I can tell you they ain't cheap, but I suspect that the Fed can afford it, as Ralph Benko of the American Principles Project, and writing in his essay "Gold, the States, and Federal Monetary Policy" here at The Daily Reckoning, notes, "Uncle Sam will spend $10 billion per day in 2011."

This is in contrast to how "the federal government spent $15 billion from 1789-1900. Not $15 billion a year. $15 billion cumulatively."

I look again at the government spending $10 billion per day, and then I look again at the government spending $15 cumulatively, and then I look again at $10 billion per day, and then again at $15 billion cumulatively for 111 years In A Freaking Row (IAFR).

Then I look at Bill Buckler, who, in his Privateer newsletter, writes, "This year, the official budget for the US government is $3,700,000,000,000. That means the government will spend $10.13 billion every day – weekends and holiday included."

Obviously, by noticing the way my head is swiveling to and fro, you know that you can bet your butt that I was ready to take this outrage and go off on a predictable Screaming Mogambo Rant (SMR) about the inflationary horrors of the Federal Reserve creating so much money and that such massive, deliberate devaluation of the dollar were even possible, and that the federal budget of $3.7 trillion doesn't include all of the $2 trillion or so that Congress will surely end up deficit-spending during the year, as hundreds and hundreds of billions of dollars more is spending is authorized during the year with "supplemental appropriations."

Fortunately, Mr. Benko barreled ahead, cutting me off, by elaborating, "The federal government spends more every two days than it did altogether for more than America's first century."

"Aha!" I thought to myself! "This is in nominal dollars! These are not inflation-adjusted dollars! Now, Mr. Benko! Now we'll see who will pay a price for cutting me off!"

My Brave Mogambo Heart (BMH) was beating with a war-cry of victory – Hahahaha! – when I was suddenly quieted as, again suddenly, out of nowhere, he again cuts me off, and cuts the guts out my objection! I am, in a word, upset!

Suddenly adrift in the bitter ashes of my defeat, I see he is leaving me with nothing except a sense of frustration and the incomparable phrase "cuts me off and cuts the guts out," which is, I guess, better than nothing, and maybe with a little editing, maybe a nice rhythmic percussion over a catchy tune, I could parlay it into a hit song, a recording career, fame and fortune, my own line of perfume ("Mogambo Mambo"), a reunion tour, and make tons and tons of money so that my revenge against Mr. Benko here, for cutting me off, would be even more sweet.

What he actually said was, "Although these sums are not adjusted for inflation, they give a correct impression of the magnitude of the change from what our Founders set forth and our early statesmen delivered," which is not only perfectly correct and perfectly horrifying, but sounds so classy, too, as compared to my coarse scratchings, deepening my sense of embarrassment and frustration.

"You want classy, eh?" I snarl. "Maybe if I come over there and piss on your shoe, then we'll see who has class and who ain't!"

Well, to my surprise, making threats against footwear was the key to victory here! He then said, without any sense of his flowing lyricism of old, "The dollar today is worth less than a quarter was worth in 1971," which is plenty of testament to his "magnitude of the change" in the purchasing power of the dollar.

The question that should come immediately to your lips is, "If that was 40 years ago, what will a dollar be worth in 40 years?"

My answer comes immediately to my lips when I answer, "You won't care if you buy gold and silver with the dollar!" That elegant simplicity makes investing so easy that I say, "Whee!"

The Mogambo Guru
for The Daily Reckoning

Purchasing Power Buckles Under Government Spending originally appeared in the Daily Reckoning. The Daily Reckoning now provides over half a million subscribers with literary economic perspective, global market analysis, and contrarian investment ideas.

Yen action sets scene for return of carry trade

Posted: 23 Mar 2011 10:11 AM PDT

By Peter Garnham and Lindsay Whipp
March 23 2011 (FT) –

… The carry trade, in which the purchase of riskier, higher-yielding assets is funded by selling low-yielding currencies, is a popular investment employed by investors to take advantage of rising asset markets.

… The Fed is due to end its "QE2" programme in June, the European Central Bank is expected to raise interest rates as early as next month, while the Bank of England is forecast to tighten policy later this year. The success of a carry trade investment strategy requires not just stability in asset markets, but a steadily weakening funding currency. The joint action from leading central banks to intervene to stem strength in the yen could help to provide both.

Traders cite a range of factors that led to last week's spike…. "Should it have continued, it risked a significant destabilisation in the financial and economic foundation of Japan," says Camilla Sutton at Scotia Capital.

Ms Sutton says the G7 stepped in to weaken the yen, not so much because the value of the Japanese currency had become extreme, but because the yen-dollar trading pattern had become disorderly and threatened global economic and financial stability.

"This type of volatility in currencies threatens much more than the economic recovery of the world's third-largest economy. Above all the G7's role was to stabilise global markets," she says. The action, which drove the yen down to Y81, where it has stayed, helped shares recover their poise after a volatile week.

Expectations of further currency intervention to come, combined with the Y40,000bn asset purchase programme announced by the Bank of Japan, means yen liquidity can only grow in coming months. Thus, the G7 has stabilised not only the asset side of the yen carry trade, but the funding side, too.

[source]

RS View: Any geologically-minded economist would rightly consider this couplet of market instability plus official response to be not a mere consequence of the natural disaster that recently hit Japan, but rather (and more ominously) an strong aftershock connected with the original global financial quake of 2007-2008 and the associated tsunami of official liquidity that inundated every shore like so much alphabet soup of national intervention and bailout programs.

LGMR: Gold Seen Nearing Cyclical Peak, Rises as Dollar Gains Amid New Euro Debt Fears

Posted: 23 Mar 2011 10:05 AM PDT

London Gold Market Report from Adrian Ash BullionVault Tues 23 Mar., 10:20 EST Gold Seen Nearing "Cyclical Peak", Rises as Dollar Gains Amid New Euro Debt Fears THE PRICE OF PHYSICAL gold bullion rose sharply against all major currencies on Wednesday morning in London, touching near-two-week highs against the Dollar even as the US currency rose amid fresh European debt and budget concerns. Crude oil and world equity prices were little changed, but major-economy government bonds rose as UN air-strikes continued in Libya, targeting loyalist Gaddafi troops attacking the rebel-held town of Misrata. West Jerusalem saw 20 people killed in a bomb attack on an Israeli bus. The Japanese authorities warned of raised radiation levels in Tokyo tap water. "Although it still remains relatively weak," says Standard Bank's daily note, "[the] moderate strengthening in the Dollar has reduced the safe-haven appeal of precious metals. "Considering that the tensions in the...

The SLA has $50 in its sites. GIABO the most successful world revolution in history . . . and it’s got more than $450 to go!!!!

Posted: 23 Mar 2011 10:00 AM PDT

Gold near record, silver tops $37 on safe-haven bid Share this:

1 billion Zynga dollars = 1/1000th Oz. of Gold so Foursquare is worth -

Posted: 23 Mar 2011 09:47 AM PDT

Foursquare Prepares To Launch Next Funding Round — Will Valuation Top $1 Billion Zynga Dollars? Share this:

Gold futures notch record high

Posted: 23 Mar 2011 09:46 AM PDT

By Claudia Assis
March 23, 2011 (MarketWatch) — Gold futures settled at a record high on Wednesday as a rally for crude reinforced fears of inflation and investors remained concerned about the Middle East and North Africa and Japan.

jump

Gold for April delivery rose $10.40, or 0.7%, to $1,438 an ounce on the Comex division of the New York Mercantile Exchange. That was enough to beat the previous record settlement of March 2, when gold closed at $1,437.70 an ounce.

"Instead of looking for a reason to buy gold, no one can find a reason not to buy gold," said Adam Klopfenstein, a senior market strategist with Lind Waldock in Chicago.

Unrest in the Middle East and North Africa, the destruction in Japan, continuation of the U.S. Federal Reserve's easing policy, and inflation are all working to support the metal, he added.

Gold is likely to challenge $1,500 sooner rather than later, especially if prices firm around $1,475 an ounce in the coming sessions, Klopfenstein said.

Gold gained momentum as the session progressed, leaving behind tepid early gains to rally as crude oil also jumped. Investors are worried about food and energy inflation on the back of rallying crude, said Charles Nedoss, a senior market strategist with Olympus Futures in Chicago. Crude-oil futures topped $106 a barrel before moderating some of their gains on Wednesday.

… In Japan, authorities warned they had detected radioactive iodine in Tokyo's water supplies, and issued a warning saying infants in Tokyo and surrounding areas should not drink tap water.

[source]

Silver, gold gain on fast-changing global events

Posted: 23 Mar 2011 09:37 AM PDT

by Sandy Shore
March 23rd, 2011 (AP/Anchorage Daily News) — Silver and gold prices are climbing as developing crises from Portugal's financial problems to uprisings in the Middle East are prompting investors to buy more stable assets.

Silver for May delivery rose 92.9 cents, or 2.6 percent, to settle at $37.198 an ounce. Gold for May delivery gained $10.40 to settle at $1,438 an ounce.

Portugal's minority government neared collapse as lawmakers were poised to vote against its proposal for more austerity measures designed to avoid a bailout. The political upheaval could lead to more turbulence for the 17 nations that use the euro.

Meanwhile, speculation lingered about supply disruptions in the oil-rich region of the Middle East and North Africa as uprisings continued in a number of countries, including Libya.

Investors are nervous as they wonder how those events will play out. That has supported precious metals, which have the reputation of being safer assets to hold during uncertain economic times.

[source]