Gold World News Flash

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• Gold Wealth Building: Fundamentals & Technicals
• Are Stocks & Commodities About To Start Another Rally?
• JP Morgan Could Learn from the Treasury
• The Swiss Franc or Euro: Good as Gold...?
• Get Ready For A New Currency
• Jim Sinclair: Buy A Hobby Farm Now
• Gold Seeker Closing Report: Gold Rises and Silver Sets a New 31-Year Closing High
• Silver - 8 hour chart update 10:15 PM CST
• "Big CPP" Dragged Into Canadian Politics?
• Don’t Believe the Chart, the US Dollar is Dropping Like a Stone
• No More Storage in Cushing: WTI will be $90 in a Month
• More on How Inflation Turns Us Into Con Artists
• Hourly Action In Gold From Trader Dan
• Fractional Reserve Banking Gone Amok
• "Skunked": Bill Gross On How "The U.S. Will Likely Default On Its Debt"
• The Swiss Franc, Euro and Gold
• Until the Gold Price Closes Above that Last High, it Remains in a Downtrend
• Gold Price Hits Another "Real Money" High
• Gold Price Hits Another "Real Money" High
• QE 3 Coming Gold And Silver To Soar!
• Gold According to a Hollywood Schizophrenic
• Gold price isn't the play, dollar's decline is, Rule tells King World News
• In The News Today
• Peering at China’s Ghostly GDP Quality
• Gold ends losing streak as price dip lures buyers
• Tracing the Path of Social Upheaval Across the Middle East and North Africa
• Rick Rule - Gold, Silver, Uranium and Ruination of the US Dollar
• OBAMA'S MID-TERM REPORT CARD
• Faros - US Dollar Decline to Accelerate
• Will Joe Wiesenthal follow Cramer?

Gold Wealth Building: Fundamentals & Technicals Posted: 30 Mar 2011 06:15 PM PDT Graceland Update

Are Stocks & Commodities About To Start Another Rally? Posted: 30 Mar 2011 05:55 PM PDT Over the past couple months everyone seems to have been preparing for a sharp market correction. Crazy part is that the SP500 dropped about 10% from the high and that is a typical bull market correction. The thing is… the stock market has a way of slowly unfolding making it look and feel minor, then before you know it, the correction is over and it’s back to an uptrend. That is kind of how this one unfolded. The good news is that we caught the low risk portion of the correction locking in a 4.5% drop, and we are now in a long trade and in the money by 2.5% with very little down side risk at this point. Time will tell if this up trend is sustainable or not… Now, let’s take a look at the charts… Dollar 60 minute intraday chart As you can see below the dollar looks to have started a breakdown today. If there is continued selling pressure in the next couple days then expect to stocks and commodities to move higher as the US Dollar drops. It ...

JP Morgan Could Learn from the Treasury Posted: 30 Mar 2011 05:52 PM PDT JP Morgan has a new excuse for its massive silver and gold investments. Short or long, whichever it happens to be claiming at the moment, Morgan says it is holding the silver for clients. To buffer its claim, JP Morgan insists the holdings are the result of a new lending window it created, where investors can deposit their gold for safe-storage and obtain a loan in the amount of the gold borrowed. In offering this lending program, JP Morgan is stocking up on gold. Investors find that the program helps them multiply returns, essentially allowing investors to buy gold as a dollar hedge and then obtaining low-rate loans against their ownership in dollars. This loan, once reinvested, essentially acts as a 200% net-long gold, as well as net-long equities or commodities. Recycled Metals Plenty of gold and silver is recycled each year when it is removed from physical goods, ranging from popular electronics to automobiles. Even more is recycled in the secondary ma...

The Swiss Franc or Euro: Good as Gold...? Posted: 30 Mar 2011 05:42 PM PDT by Adrian Ash BullionVault Wednesday, 30 March 2011 Everyone wants out of the Euro except Swiss exporters. What choice does the SNB have? ULTRA-CHEAP MONEY has caused a whole heap of mischief to date. But really, this is getting silly... "Switzerland may be better off adopting the Euro as the Franc's appreciation hurts exports," reports Bloomberg from Basel. "It's a nightmare for everybody," says Thierry Stern, chairman of luxury watchmaker (and glossy-magazine benefactors) Patek Phillipe. "We have to adapt. Something will come. I don't know when, but one day it will happen." Industrialists are always in favor of devaluation, of course. Who do you think approved and drove Germany's Weimar inflation in the early 1920s? And with export sales accounting for one half of Swiss GDP – pretty much the same proportion as Germany enjoys – the thought of abandoning the Franc shouldn't really shock your local bar-room economist. The get-ahead Euro sure helped Germany exte...

Get Ready For A New Currency Posted: 30 Mar 2011 05:41 PM PDT There is a lot of talk about the dollar losing it's global reserve currency status and what is to replace it. A global reserve currency is a very privileged status that makes our paper fiat dollars the king of all currencies. The dollar represents the currency of the most powerful empire in the world. This dollar allows every nation access into the largest, deepest, and presumably safest markets in the world. It is also the only currency to be used to buy the most vital resource in the world, oil. Through the London and New York markets, countries all over the world, are forced to keep dollars to buy oil from these banking houses. As a result of this unique status, countries also settle bilateral trade with each other with our dollars. So trade between countries like Venezuela and  Norway are not settled in Bolivars and Kroner, they are settled in dollars. This unique status of the dollar is starting to fall apart and the Elite know it. Iran is now selling oil in any currency at the Iranian Oil Bourse in Kish Iran. (This is the real reason why there is a push for war with Iran.) This passive aggressive assault on the dollar has given the chance for other countries to question why they need the dollar at all. Especially when these dollars implicitly funds the aggressive American Empire. Countries like China and Russia have dropped the dollar from their bilateral trade. Japan may no longer see any reason to buy US dollars in the treasury markets, as they try to rebuild their economy after the triple disaster they are now facing. More Here..

Jim Sinclair: Buy A Hobby Farm Now Posted: 30 Mar 2011 05:24 PM PDT My Dear Friends, Truth be told, the major theme of JSMineset has been one of self reliance in a monetary, physical and Emersonian sense. Our focus has been on your assets, your debt positions, legal matters and investment. I have, with my dear friends here at JSMineset, tried to share what we know with you. We also pride ourselves in that we not only talk the talk, but also walk the walk. Has Trader Dan not moved from Houston to an undisclosed location in Idaho? I am writing to you from a farm in North Western Connecticut, a rural part of the state. We provide our own water, can provide our own power, have a radio system fallback for communication, satellite phones, furnaces that burn coal or oil, an indoor pistol range that can take up to .50 calibre cartridges into a Detroit bullet trap, perimeter lighting, 16 camera day and night camera security and much more. We have focused on conservative financial structures which were in truth taking you into the position of being your own central bank. I have received from many people on my 70th birthday greetings plus small letters telling me how they have benefited from this link. Let me mention but two. A lady in the minerals industry lost her job and is the mother of two children and only bread winner in the house. She had very little money, but saved up a nest egg. She admits she did speculate but used the Angels. She now has $2,000,000 and has finished her period of speculation. Chris from Canada told me that his portfolio, now mostly fully paid gold and silver, is worth $5,000,000. It was nowhere near that when he started. Every effort here was to make you your own central bank which resulted in financial self reliance for many. More Here..

Gold Seeker Closing Report: Gold Rises and Silver Sets a New 31-Year Closing High Posted: 30 Mar 2011 04:00 PM PDT Gold climbed $13.42 to $1429.82 in early New York trade before it fell to see a $4.20 loss at $1412.20 by late morning, but it then rallied back higher in the last couple of hours of trade and ended with a gain of 0.54%. Silver surged to as high as $37.732 before it fell back to almost unchanged at $36.963 by a little after 11AM EST, but it also rallied back higher into the close and ended with a gain of 1.46% at a new 31-year closing high.

Silver - 8 hour chart update 10:15 PM CST Posted: 30 Mar 2011 03:31 PM PDT [url]http://www.traderdannorcini.blogspot.com/[/url] [url]http://www.fortwealth.com/[/url] In Asian trading, silver is continuing to push higher building on its gains from the New York session in what appears to be further confirmation of the metal carving out a new consolidation zone at a higher level. The top of this new zone is shy of $38 with the bottom down near $37 and slightly below there. Upside volume is picking up which is positive but until the market can strongly clear $38 and maintain that, the new leg higher is elusive. Note that the indicator is moving into giving a buy signal ...

"Big CPP" Dragged Into Canadian Politics? Posted: 30 Mar 2011 02:59 PM PDT Via Pension Pulse. Another federal election campaign in Canada (sigh!) and this time pension politics are front and center. Les Whittington of the Toronto Star reports, Liberals propose supplementary public pension plan: A Liberal government would earmark an extra $700 million a year for low-income seniors and create a supplementary public pension plan to help Canadians save for retirement, Liberal Leader Michael Ignatieff says.   The party’s proposed expansion of the Guaranteed Income Supplement would provide the poorest of seniors with an extra $650 a year, Liberal officials said. If elected, the Liberals would also quickly open discussions with the provinces to gradually increase premiums and benefits of the Canada Pension Plan, the party announced.   “Canadians who work their whole lives to provide for their families deserve a secure retirement,” Ignatieff commented during a campaign stop in Vancouver.   He said the situation is urgent because 75 per cent of Canadians working in the private sector do not have a registered pension plan.   Strengthening the CPP can only be done in concert with the provinces, Ignatieff noted. “This is a case where the federal government of Canada has to step up and provide leadership on pensions. We’ve had no leadership from Mr. Harper on pensions in five years.   “So what we want to do is sit down with the provinces . . . and work out with them how we get there. And it’s going to require something that Mr. Harper doesn’t seem to know how to do, which is sit down with the premiers and say, ‘We’ve got a common Canadian challenge, which is how to provide retirement security for all Canadians.’ ”   The main innovation promised by the Liberals is a Secure Retirement Option, or SRO, which would allow employees to top up their retirement savings through a supplementary plan administered by the CPP board.   It would allow employees and employers to voluntarily contribute to a tax-deductible retirement fund. An individual’s annual contribution ceiling would be determined by his or her RRSP contribution limit. Contributions to an RRSP and the SRO could not, when combined, exceed the individual’s annual RRSP contribution ceiling.   The Liberals said the plan would offer a low-cost, secure savings option. Ignatieff also proposed a Stranded Pension Agency to help manage the private pensions of employees left stranded when a company goes bankrupt.   In government, the Conservatives expressed interest last year in gradually strengthening the CPP but instead opted to begin work on a Pooled Registered Pension Plan, which would be administered by banks and insurance companies. The Conservatives said they were offering this plan because negotiations with the provinces over enhancing the CPP were dragging on without agreement.   Opposition parties and union leaders said the new private plan proposed by the Conservatives would do little to address the problem of low retirement savings for average Canadians.   In the recent federal budget, the Conservatives proposed an increase in the Guaranteed Income Supplement of $300 million annually to provide more assistance to low-income seniors. The NDP, which had asked for a $700-million increase, said the Conservatives’ measure was inadequate, citing it as one of the reasons the NDP would not support the Tory budget. Jonathan Chevreau of the National Post attacked the Liberals' proposal stating, Liberals push Big CPP as retirement saviour over Tories’ Pooled RPPs: Four months after the Conservatives opted instead to beef up employer pensions, Liberal Leader Michael Ignatieff has revived the idea of an expanded “Big CPP.”   He also promises to match the NDP’s pet project of giving the country’s poorest seniors top-ups to the Guaranteed Income Supplement, a measure that was also in last week’s short lived federal budget.   As announced Wednesday in Vancouver, Ignatieff also promised a new Secure Retirement Option (SRO), billed as a voluntary and portable tax-deductible savings option backed by the publicly-run Canada Pension Plan.   Secure Retirement Option has same contribution limits as RRSPs   The so-called SRO would let workers save an extra 5 to 10% of pay, using the same contribution limits as RRSPs. And in an odd shot at higher-income earners, the Liberal press release says this will “prevent upper income earners from accessing an unfair amount of tax sheltering.”   That’s curious, given that the total amount of tax-sheltered retirement savings, whether through RRSPs or employer pensions, has long been about half of what it is in the U.S. or the U.K. Also, according to Towers Watson actuary Ian Markham, those voluntary contributions will erode individuals’ RRSP contribution room, which may mean no new net savings from the program.   The pension industry debated reform throughout 2010, with a gradually expanded Big CPP favoured by labour leaders. The CPP entails a form of payroll tax, with contributions split between employers and employees, so an expanded CPP would require higher premiums from both.   Tories, financial industry favor PRPPs   However, in December, Finance Minister Jim Flaherty instead unveiled proposals for Pooled Registered Pension Plans or PRPPs, aimed at letting small and medium size businesses share resources and cut costs through traditional employer pensions. The goal is to help out the estimated 3.5 million middle-income private sector workers who have no employer pension.   The PRPP has already had initial negotiations with the provinces, so is already moving down that path, Markham says. “The Feds did agree the provinces are free to force employers to offer a PRPP. I wonder if the Liberals would go down that path as well?”   Ignatieff acknowledges three quarters of private-sector workers are not in employer pensions (RPPs) but dismisses PRPPs as being fraught with “risk, complexity and hidden management fees.” They offer “little more than RRSPs already offer” but naturally appeal to the banks and insurance companies that will manage them, he said.   But the Liberal analysis is off base when it declares many RRSPs have annual charges of 2% or more. That may be true for those who hold mutual funds in their RRSPs, but it’s patently untrue for self-directed RRSPs holding individual stocks or exchange-traded funds.   Ignatieff also accuses Stephen Harper of “abandoning” the CPP and delivering no serious pension reform the last five years, conveniently forgetting 2009’s revolutionary Tax Free Savings Accounts, pension splitting and now the PRPPs.   Labour likes Big CPP, especially in addition to their lush pensions   One reason Labour likes an expanded CPP is it promises a guaranteed or “defined” benefit that will be there regardless how financial markets behave. Ignatieff reminded voters that (under Lester Pearson), the Liberals created the CPP in 1965. A backgrounder says any such expansion requires approval of two thirds of the provinces but most support a gradual expansion of the plan.   Quebec may be a problem since it runs its own QPP separate from the CPP. Ian Markham says in its recent budget, Quebec said contributions would have to be hiked just to maintain existing benefits. In addition, just two weeks ago, Quebec proposed its own version of a PRPP.   Gradual CPP expansion OK only if done right   A gradual expansion of the CPP is a good idea but only if it is done right, says Fred Vettese, chief actuary with Toronto-based Morneau Shepell. “That means responsible employers who already provide pension coverage should be able to pare back that coverage dollar for dollar to reflect the increase in CPP.”   But that’s not what labour groups have in mind, Vettese says. “They want to see a bigger CPP pension cheque in addition to the employer pension they already get, and in some cases the resulting pension will be excessive.”   Consultant Greg Hurst, of Vancouver-based Greg Hurst & Associates Ltd., agrees: “Higher CPP benefits would unnecessarily benefit those who already have good pensions. It will also cost taxpayers more money to support higher CPP contributions of public sector employers, that already offer very generous pension plans.”   Secure Retirement Option a voluntary DC pension   The Secure Retirement Option (SRO) resembles the voluntary savings plan proposed by pension consultant Keith Ambachtsheer and others, Vettese says: This would be a pure defined contribution arrangement with one pool of assets and would be run by the Canada Pension Plan Investment Board. This isn’t a bad idea in most respects, and in fact it may be more workable than Pooled Registered Pension Plans (PRPPs), which the various provincial governments are currently struggling to define.   The one problem with SRO is that it concentrates even more of the nation’s retirement savings in government hands rather spreading risk by involving other sources, including the private sector. As the recent pension problems in the U.S., France or Spain (or even the Caisse de Depot) suggest, a government-led pension solution works well until it doesn’t. Of the SRO, Hurst says the financial industry already delivers pension programs for employees of medium and larger enterprises at costs lower than current administration and investment costs of the CPP. He favours the Tories’ PRPP: PRPPs have the prospect of making such lower cost options also available to employees of smaller businesses and the self-employed. For my money, the PRPP concepts of making it mandatory for employers to offer a pension plan or PRPP access, with automatic enrollment of employees with an opt-out option are likely to be far more effective in providing pensions to those Canadians that do not currently have them. Abandoning the progress made with the provinces on the PRPP Framework will only serve to further delay meaningful pension reforms. Both are possible but three-way balance needed   Actuary Malcolm Hamilton, worldwide partner with Mercer’s, has said he favours a “modest” expansion of CPP but that the gradual nature of it will be of little use to those already near retirement. There’s room for both an expanded CPP and PRPPs, he told me in December.   Most financial planners believe retirement should be like a three-wheeled tricycle, with income coming from a government wheel, employers and private savings. Government already provides Old Age Security, GIS and the CPP (albeit with premiums from employers and workers), while individuals have RRSPs, TFSAs and taxable investments.   It’s the employer wheel that seems wobbly and it seems to me that by focusing on employers, the Conservatives’ PRPPs provides more balance than a Big CPP. But it’s no surprise proponents of Big Government also want a Big CPP. Mr. Chevreau makes some good points on the success of TFSAs, introduced by the Conservatives, but his defense of PRPPs and his attack of supplementary CPP is way off base. It shows that he has no clue whatsoever about the benefits that come from having retirement money managed by the Canada Pension Plan Investment Board (CPPIB) or other large Canadian defined-benefit plans. Let me go over Mr. Chevreau's main points and highlight my concerns. First, any article that cites actuaries and investment experts from private firms like Towers Watson, Morneau Shepell, Greg Hurst & Associates Ltd and Mercer is hardly objective. Mr. Chevreau should disclose what percentage of their business comes from private Canadian businesses as opposed to the large Canadian defined-benefit (DB) plans? I hazard to guess that almost all their business comes from the private sector as opposed to the large public DB plans which is why they're not going to publicly endorse an expanded CPP proposal full force. It's too bad the Office of the Chief Actuary of Canada can't comment on what these actuaries are stating about a supplementary CPP proposal. Second, while it's true that an expanded CPP would require higher premiums from both employees and employers, Canadians want expanded CPP. It's not just public and private labour unions who are backing this proposal, most Canadians are worried about their retirement and rightfully so. Unlike public sector workers and politicians who enjoy the security and peace of mind that comes from their defined-benefit pension plans (which they contribute to), many Canadians in the private sector have little or no savings in the form of RRSPs. Third, Mr. Chevreau states that the Liberal analysis is "off base when it declares many RRSPs have annual charges of 2% or more" adding "that may be true for those who hold mutual funds in their RRSPs, but it’s patently untrue for self-directed RRSPs holding individual stocks or exchange-traded funds (ETFs)." Mr. Chevreau doesn't bother researching what percentage of RRSPs are self-directed. Everyone in the financial industry knows that the bulk of RRSP assets are in mutual funds and as I stated many times before, Canadians who are able to save in their RRSPs are getting raped on fees in their mutual fund investments. Moreover, only a tiny minority of investors with a self-directed RRSPs investing individual stocks or ETFs are outperforming any of the large Canadian defined-benefit plans over the last 10 or 15 years. And as I've stated many times before, defined-contribution plans or PRPPs can't compete with the large Canadian defined-benefit plans. Why? Because the latter are able to pool billions in assets, negotiate lower fees, manage a substantial portion of assets internally (thus lowering costs) and invest and co-invest with the best public and private fund managers across the world. For example, most Canadians are clueless about CPPIB's investment partners, but I assure you that no DC plan I know of can invest in Brevan Howard, Bridgewater, Apax, Lone Star, Texas Pacific Group or any of the other top public and private funds listed on their site. This is an important source of alpha, on top of the internally generated alpha, adding basis points on their beta (benchmark) portfolio. Over the long-term, all that alpha adds up, which is why CPPIB pays these managers big fees but they're delivering meaningful alpha. Fifth, I take issue with Mr. Vettese's following statement: The one problem with SRO is that it concentrates even more of the nation’s retirement savings in government hands rather spreading risk by involving other sources, including the private sector. As the recent pension problems in the U.S., France or Spain (or even the Caisse de Depot) suggest, a government-led pension solution works well until it doesn’t. Spreading risk across the private sector? Who are we kidding here? Yes, most of the large Canadian public DB plans got clobbered in 2008, but many have bounced back nicely and have implemented serious risk management policies to manage their liquidity risk and protect their downside. When private companies with DB plans go belly-up, their pension obligations don't magically disappear. The government and taxpayers are on the hook for a portion of their pension obligations. Just look at the Nortel debacle. That brings me to my final point. Diane Urquhart sent me the video below and an article stating that the federal government of Canada has been stonewalling Nortel's disabled by killing Bill S-216 and Bill C-624. We got serious problems in Canada which I already alluded to in my comments on the Canada bubble and Canada's mortgage monster, but one thing we can all agree on (I hope) is that we have to defend the rights of society's most vulnerable. It's morally wrong to stonewall the demands of Nortel's disabled because the creditors don't want to be placed behind pensioners and the disabled. Pensions and the rights of the disabled must transcend politics. Let's do the right thing and give these people what they rightly deserve and introduce essential changes to the Bankruptcy and Insolvency Act to make sure this injustice never happens again. Don't worry, Big Business will survive.

Don’t Believe the Chart, the US Dollar is Dropping Like a Stone Posted: 30 Mar 2011 01:48 PM PDT I want to take a moment to address the US Dollar’s collapse.   The US Dollar which most investors follow is the US Dollar index. This represents the US Dollar’s value against a basket of major currencies: the Euro, Japanese Yen, etc.   Think about that for a moment: the way we measure the US Dollar’s value is against a collection of other un-backed paper currencies all issued by over-indebted, bankrupt nations.   In other words, its nonsense.   Case in point, the Euro comprises over 50% of the US Dollar index. What’s the Euro? A currency backed by a loose group of bankrupt nations with maybe two solvent members in the bunch. Greece has already asked for an extension on its bailout repayments (like they’re ever going to repay anything), Spain is bankrupt, ditto for Ireland, Italy, Portugal, and others.   As for the more solvent European members (Germany and maybe France) their political leaders are getting crushed in the elections because NOBODY who actually works for a living (or has a working brain) wants in on the Euro.   So in Europe we’ve got one perhaps two solvent countries that are supposed to bailout 5+ insolvent ones (like that’s even possible). And the solvent countries are comprised of people who want no part of the Euro.   Man, now that’s what I call a real currency.   In simple terms, to claim the Euro is a viable currency is pure insanity. And yet, this “currency” comprises 50% of the US Dollar index (not as though the Yen or US Dollar are worthwhile either).   My point in all of this is that measuring the greenback using the Euro is insane. 100% totally insane. Which is why claiming the US Dollar is not collapsing is BS. If you actually go outside the US (which 99% of commentators don’t) you’ll find that the US Dollar is worth much less than the Dollar index is telling you.   I was recently on a trip to South America looking at real estate. While there I was told repeatedly by developers that they didn’t want to sign a contract in US Dollars. Instead they wanted to do it in the local currency.  This has NEVER happened before during my trips abroad (even as recently as 2009).   When I pushed for having contracts based in Dollars, the price went up EVERY week.   The reason? The US Dollar is falling in relation to the local currency on a daily basis.   So here are local businessmen, (not economists or analysts), people who actually work for a living, refusing to accept US Dollars during business transactions.   That alone should tell you just where the US Dollar stands on the international stage.   In plain terms, the US Dollar crisis is already underway. If you ignore the stupid headlines and pay attention to the real world you can already see it. Prices of goods are EXPLODING higher. It’s being hidden because retailers are downsizing the size of their packages OR packing less goods in the same space (look inside any cereal box or other dry good and you’ll find that at best it’s 75% full).   So if you think things are fine because the US Dollar chart shows we still have a few lines of support, you’re being mislead. The US Dollar is worth far, far less than the chart shows you. So if you want to prepare yourself for a currency crisis you need to move now.   On that note, if you’re getting worried about the future of the stock market and have yet to take steps to prepare for the Second Round of the Financial Crisis… I highly suggest you download my FREE Special Report specifying exactly how to prepare for what’s to come.   I call it The Financial Crisis “Round Two” Survival Kit. And its 17 pages contain a wealth of information about portfolio protection, which investments to own and how to take out Catastrophe Insurance on the stock market (this “insurance” paid out triple digit gains in the Autumn of 2008).   Again, this is all 100% FREE. To pick up your copy today, got to http://www.gainspainscapital.com and click on FREE REPORTS.   Prepare Now!   Graham Summers   PS. We ALSO publish a FREE Special Report on Inflation detailing three investments that have all already SOARED as a result of the Fed’s monetary policy. You can access this Report at the link above.

No More Storage in Cushing: WTI will be $90 in a Month Posted: 30 Mar 2011 01:41 PM PDT By Dian L. Chu, EconMatters The latest inventory report came out on Wednesday, March 30 from the U.S. EIA (Energy Information Administration) showing Cushing stocks at a record 41.9 million barrels (Fig. 1). And guess what? The news is only going to get worse for WTI longs, as the next couple of weeks will bring the total storage at Cushing close to the max capacity of 44 million barrels due to the fact that more traders took delivery on WTI on the last CL rollover. MENA Does Not Matter Much There is a three week span after the expiration where actual physical delivery takes place, so expect the next two EIA reports to test whatever remaining spare capacity exists at Cushing. In other words, it doesn`t really matter what is occurring in the MENA (Middle East and North Africa), since over the next month at the next rollover, traders will have to sell any long positions because they cannot take delivery even if they wanted to. Abnormal Crude Deliveries Furthermore, because of the events transpiring in the MENA over the last couple of months, traders who normally don`t take delivery have taken delivery over the last two rollovers, due to ‘what if” scenarios where Saudi Arabia became a legitimate concern, and oil spiked to $130 a barrel. The fallout from this is that traders and investors who normally take delivery will not be able to during this next rollover, as there will literally be no more storage at Cushing. New Sellers Abound This is very bearish for WTI prices over the next month, as now you are going to have an entirely new segment of sellers come rollover time. As such, expect the U.S. WTI (West Texas Intermediate) prices to overshoot to the $90 a barrel range as shorts pile in before recovering a little around $93 a barrel at rollover (give or take a couple of bucks in either direction). It is just not Cushing, the total U.S. supplies rose for the 10th time in 11 weeks, up another 2.9 million barrels for the March 25 week to 355.7 million (Fig.2). Remember during the summer when oil prices were in the low $70s? Well, inventories were at the height around 368 million barrels, which became a big headwind for long only speculators in crude oil at the time. Demand Destruction by High Oil Prices? So, here we are--only 12 million barrels from that exceedingly bearish level of US storage. And with these high prices we are starting to experience legitimate demand destruction. It seems with these high prices it is only a matter of time before we are again at the 368 million barrels of oil in US storage facilities at the Commercial level. So the Oil Bulls can no longer point to Cushing as an anomaly, we are literally swimming in Crude Oil right now in the US. What’s Up with Rising Imports? The news gets even more bearish for the Brent crowd as the following question should be asked regarding rising imports which are at their highest level in two months, at 9.1 million barrels per day--If there is such a tight supply in crude oil internationally, i.e., reflected in a much higher Brent premium to WTI, then why are imports rising when the US already has sufficient supply right now? The reason is that there is no other place for this oil to go, especially with Japan`s massive cutback due to a natural disaster which has severely hampered much of its manufacturing, supply chain infrastructure, and domestic demand. All of this portends for continued higher import numbers for the next couple of months until Japan starts ramping back up to normal Oil demand statistics. Logic Says ….. Unfortunately, Brent doesn`t actually have easily discernible inventory numbers, but through logical deduction one can surmise that if supply were really as tight as the price suggests, then imports to the US market would actually be significantly down, and not up. So expect Brent to come in as well over the next month. (Maybe in the range of $105 to $107 a barrel). High Prices Kill Demand With regard to the product side, gasoline inventories fell 2.7 million barrels to 217.0 million (Fig. 2) for the sixth straight weekly draw as there was a period at the beginning of the year where we had a succession of inventory builds in gasoline products. The draw reflects decreasing refinery output, at 8.7 million barrels per day for the lowest rate in almost three months. Refineries are cutting output as gasoline demand weakens in direct correlation over the last month due to higher prices at the pump, down 0.1% for the first negative year on year reading since the beginning of February. This is a prime example of economics with regards to higher prices affecting consumer`s driving behavior, enough to lower demand for the product in the market. There is a slight lag between the RBOB futures price and the price paid at the pump, so expect demand to even go down further as gasoline prices fully manifest the appreciation in the futures market. Down Goes The Pump Price There is some good news for consumers in all of this as oil prices correct down over the next month; prices at the pump will start to go down as well. It is really the only way to get the consumer demand numbers back up and positive year on year which is necessary to work off these large inventory numbers in crude oil storage. Correct Now or Collapse Later The consumer and the US economy needs lower prices to grow at a significantly higher rate in order to make a dent in an overall saturated oil market. The longer prices stay artificially high, and not reflect true demand in the market, well given the current oversupply situation, the correction when it does occur will be even sharper (For example the 2008 Oil collapse). The old adage “you can pay now, or pay later” applies to the crude oil market here. You can ignore fundamentals for only so long, in the short term, supplies don`t really matter to traders, but there comes a time when fundamentals in the market supersede political and technical based analysis. In the end, fundamentals have the ultimate and final say regarding price direction in the market. And over the next month, fundamentals will dictate that Crude Oil prices correct to a lower level from current levels. This correction would actually be healthy for the oil market, if this fails to materialize, and oil prices stay high with continuing oversupply, and weak demand, i.e., an artificial mismatch between supply, demand, and price, expect an even “healthier” and fundamentally more severe correction when market equilibrium reasserts itself. Supply & Storage Fundamental Matters Now that I have your attention, no one can predict where oil prices will actually go as the crude oil market is a complex equation with ever changing variables. However, the purpose of the article is to discuss the developing supply and storage capacity dynamics in the market place. Some other factors which might help facilitate crude oil`s decline would be the stepping down of Libyan leader Muammar Qaddafi, an early ending to QE2, a strengthening US Dollar, and some profit taking in some of the commodity related funds that include Gold, Silver, and Oil. As recent fund inflows have helped prop up WTI beyond purely concerns over the unrest in the MENA region, the exact oil price will depend upon some of these other factors. Nevertheless, it seems reasonable to assume that one factor is quantifiable, and that is the supply issues with regard to storage capacity in the US market.  Given these dynamics, WTI should close lower than when it started as the front month contract, and that hasn`t happened in a while, with prices being somewhere in the $90s. Related Reading - Impending Crude Correction By Mass Rollover EconMatters, March 30, 2011 | Facebook Page | Post Alert | Kindle

More on How Inflation Turns Us Into Con Artists Posted: 30 Mar 2011 01:24 PM PDT Here's a Phil's Stock World favorite for today.  John Rubino is the co-author of the book "The Collapse of the Dollar" and writes frequent articles about the economy at his blog, "Dollar Collapse." - Ilene More on How Inflation Turns Us Into Con Artists Courtesy of JOHN RUBINO of Dollar Collapse  John Maynard Keynes once said of inflation: There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose. Here’s one of the “hidden forces of economic law” to which Keynes referred, courtesy of yesterday’s New York Times: Food Inflation Kept Hidden in Smaller Bags Chips are disappearing from bags, candy from boxes and vegetables from cans. As an expected increase in the cost of raw materials looms for late summer, consumers are beginning to encounter shrinking food packages. With unemployment still high, companies in recent months have tried to camouflage price increases by selling their products in tiny and tinier packages. So far, the changes are most visible at the grocery store, where shoppers are paying the same amount, but getting less. For Lisa Stauber, stretching her budget to feed her nine children in Houston often requires careful monitoring at the store. Recently, when she cooked her usual three boxes of pasta for a big family dinner, she was surprised by a smaller yield, and she began to suspect something was up. “Whole wheat pasta had gone from 16 ounces to 13.25 ounces,” she said. “I bought three boxes and it wasn’t enough — that was a little embarrassing. I bought the same amount I always buy, I just didn’t realize it, because who reads the sizes all the time?” Ms. Stauber, 33, said she began inspecting her other purchases, aisle by aisle. Many canned vegetables dropped to 13 or 14 ounces from 16; boxes of baby wipes went to 72 from 80; and sugar was stacked in 4-pound, not 5-pound, bags, she said. Five or so years ago, Ms. Stauber bought 16-ounce cans of corn. Then they were 15.5 ounces, then 14.5 ounces, and the size is still dropping. “The first time I’ve ever seen an 11-ounce can of corn at the store was about three weeks ago, and I was just floored,” she said. “It’s sneaky, because they figure people won’t know.” In every economic downturn in the last few decades, companies have reduced the size of some products, disguising price increases and avoiding comparisons on same-size packages, before and after an increase. Each time, the marketing campaigns are coy; this time, the smaller versions are “greener” (packages good for the environment) or more “portable” (little carry bags for the takeout lifestyle) or “healthier” (fewer calories). Where companies cannot change sizes — as in clothing or appliances — they have warned that prices will be going up, as the costs of cotton, energy, grain and other raw materials are rising. “Consumers are generally more sensitive to changes in prices than to changes in quantity,” John T. Gourville, a marketing professor at Harvard Business School, said. “And companies try to do it in such a way that you don’t notice, maybe keeping the height and width the same, but changing the depth so the silhouette of the package on the shelf looks the same. Or sometimes they add more air to the chips bag or a scoop in the bottom of the peanut butter jar so it looks the same size.”Thomas J. Alexander, a finance professor at Northwood University, said that businesses had little choice these days when faced with increases in the costs of their raw goods. “Companies only have pricing power when wages are also increasing, and we’re not seeing that right now because of the high unemployment,” he said. Most companies reduce products quietly, hoping consumers are not reading labels too closely. But the downsizing keeps occurring. A can of Chicken of the Sea albacore tuna is now packed at 5 ounces, instead of the 6-ounce version still on some shelves, and in some cases, the 5-ounce can costs more than the larger one. Bags of Doritos, Tostitos and Fritos now hold 20 percent fewer chips than in 2009, though a spokesman said those extra chips were just a “limited time” offer. Trying to keep customers from feeling cheated, some companies are introducing new containers that, they say, have terrific advantages — and just happen to contain less product. Kraft is introducing “Fresh Stacks” packages for its Nabisco Premium saltines and Honey Maid graham crackers. Each has about 15 percent fewer crackers than the standard boxes, but the price has not changed. Kraft says that because the Fresh Stacks include more sleeves of crackers, they are more portable and “the packaging format offers the benefit of added freshness,” said Basil T. Maglaris, a Kraft spokesman, in an e-mail. And Procter & Gamble is expanding its “Future Friendly” products, which it promotes as using at least 15 percent less energy, water or packaging than the standard ones.“They are more environmentally friendly, that’s true — but they’re also smaller,” said Paula Rosenblum, managing partner for retail systems research at Focus.com, an online specialist network. “They announce it as great new packaging, and in fact what it is is smaller packaging, smaller amounts of the product,” she said. Or marketers design a new shape and size altogether, complicating any effort to comparison shop. The unwrapped Reese’s Minis, which were introduced in February, are smaller than the foil-wrapped Miniatures. They are also more expensive — $0.57 an ounce at FreshDirect, versus $0.37 an ounce for the individually wrapped. At H. J. Heinz, prices on ketchup, condiments, sauces and Ore-Ida products have already gone up, and the company is selling smaller-than-usual versions of condiments, like 5-ounce bottles of items like Heinz 57 Sauce sold at places like Dollar General. Some thoughts: When Fed officials claim that inflation is “well contained” are they measuring per ounce or per package? It wouldn’t be a surprise, given how disconnected from reality they frequently sound, if they’re being fooled by manufacturers’ packaging scams. [The Fed officials may measure package to package without being "fooled."  I remember reading that that was permissible and will look for the reference.  See also Michael Panzner's "More than a little doubt." - Ilene] If manufacturers are playing games with package sizes you can bet they’re also using cheaper ingredients, so not only are we getting less of our favorite things, they’re probably not as good as they were when we first developed an attachment to them. It’s an article of faith among modern economists that a little inflation is a good thing because it lets companies raise prices and workers get raises, so everyone feels richer. But that ignores the other side of the equation, which is, as we’re now seeing, a decline in product quality and producer credibility. In the end we don’t feel richer because we got a raise; we feel ripped off by companies we used to respect. Those same economists see deflation as a bad thing because it makes debt harder to carry. But this also overlooks the impact of incentives on behavior and character. Consider: if you make, say, candy bars and the prices of sugar and chocolate are going down, you want to avoid having to cut your selling price because holding the line on price produces a wider profit margin. So you start using higher-grade chocolate or increasing your candy bars’ size — and you let your customers know that you’re improving your products. Your credibility goes up because you’re offering a better deal, and doing so very publicly. As this practice spreads through the larger economy, the result is a culture of quality and integrity and customer service. Where inflation turns merchants into secretive con artists, deflation produces transparent purveyors of ever-better deals. In a deflationary world, our paychecks don’t rise as much, but everyone seems to be working for us rather than trying to rip us off. Viewed this way, only an idiot (or a Keynesian economist) would choose inflation over deflation. Picture credit: Jesse's Cafe Americain

Hourly Action In Gold From Trader Dan Posted: 30 Mar 2011 01:00 PM PDT View the original post at jsmineset.com... March 30, 2011 01:39 PM Dear CIGAs, Rollovers are continuing in gold with traders moving out of the April as it enters its delivery period and into the June. Some are also moving into August and December. Open interest continues to decline as end of the month and quarter pressures continue but the bulk of that should be over today. How this market behaves Friday and Monday of next week will be a better indicator of what we can expect in the immediate near term. Trying to get too much of a read on a market that is being jostled by book squaring and low volume is generally not wise. High oil inventories at Cushing were being blamed somewhat for gold’s weakness today but I do not agree with that reasoning. Oil is still above $100, high inventories or not, and a mere blip lower in crude oil is not going to dissuade those who are focused on increasing price pressures throughout the economy. Besides, even though crude was weaker today, unl...

Fractional Reserve Banking Gone Amok Posted: 30 Mar 2011 12:00 PM PDT From Chartoftheday.com we get the Quote of the Day, which is from the legendary Will Rogers, who cleverly said, "The fellow that can only see a week ahead is always the popular fellow, for he is looking with the crowd. But the one that can see years ahead, he has a telescope but he can't make anybody believe that he has it." In a frantic bid for attention, which I obviously crave, I tell the kids to shut the hell up, explaining that the hospital emergency room is open 24/7 and they just have to stop bleeding all over the damned place for a lousy minute so that I can take this serendipitous opportunity to improve on Will Rogers, which will prove how smart I am, and how some lucky business owner might say, "Wow! Look at this Mogambo character! What a brain! And a stalwart family man, too! I must offer him a position that has a large salary and a benefits package to rival that of the average government employee, even though hiring him would make me look like an idiot!" To those nonbel...

"Skunked": Bill Gross On How "The U.S. Will Likely Default On Its Debt" Posted: 30 Mar 2011 11:26 AM PDT In a letter focusing on what has been well known to Zero Hedge readers for about two years now, Bill Gross' latest investment outlook does the usual attack of Beltway stupidity (as if Congress is in any way competent of making math-related decisions - they do what Wall Street - that's you Bill! - tell them to do, and you know it), emphasizing the impossible math of total US entitlement liabilities (on a net present value basis), which Gross estimates at $75 trillion. That Gross conclusion is predetermined from the onset is not surprising: "Unless entitlements are substantially reformed, I am confident that this country will default on its debt; not in conventional ways, but by picking the pocket of savers via a combination of less observable, yet historically verifiable policies – inflation, currency devaluation and low to negative real interest rates." Then again, that America is bankrupt is not really news to anyone. Neither is it news, that Gross, as we first reported, no longer has any US bonds to dispose of. What will be news is the inflection point at which Gross starts purchasing Treasuries once again. And after all with $220 billion in AUM in the Total Return Fund, what else will he do: hold on to cash? Buy Netflix? Then the only question will be how Gross spins the inevitable capitulation of the re-hypocrisy trade, validating that he, in a narrow sense, and PIMCO in a broad one, is perhaps the biggest cog in the very system that Bill spends so many hours writing letters about and complaining against. But yes, even that won't be all that surprising to us. After all, in this bizarro world absolutely everything is now priced in. From PIMCO Skunked Medicare, Medicaid and Social Security now account for 44% of total federal spending and are steadily rising. Previous Congresses (and Administrations) have relied on the assumption that we can grow our way out of this onerous debt burden. Unless entitlements are substantially reformed, the U.S. will likely default on its debt; not in conventional ways, but via inflation, currency devaluation and low to negative real interest rates. That adorable skunk, Pepé Le Pew, is one of my wife Sue’s favorite cartoon characters. There’s something affable, even romantic about him as he seeks to woo his female companions with a French accent and promises of a skunk bungalow and bedrooms full of little Pepés in future years. It’s easy to love a skunk – but only on the silver screen, and if in real life – at a considerable distance. I think of Congress that way. Every two or six years, they dress up in full makeup, pretending to be the change, vowing to correct what hasn’t been corrected, promising discipline as opposed to profligate overspending and undertaxation, and striving to balance the budget when all others have failed. Oooh Pepé – Mon Chéri! But don’t believe them – hold your nose instead! Oh, I kid the Congress. Perhaps they don’t have black and white stripes with bushy tails. Perhaps there’s just a stink bomb that the Congressional sergeant-at-arms sets off every time they convene and the gavel falls to signify the beginning of the “people’s business.” Perhaps. But, in all cases, citizens of America – hold your noses. You ain’t smelled nothin’ yet. I speak, of course, to the budget deficit and Washington’s inability to recognize the intractable: 75% of the budget is non-discretionary and entitlement based. Without attacking entitlements – Medicare, Medicaid and Social Security – we are smelling $1 trillion deficits as far as the nose can sniff. Once dominated by defense spending, these three categories now account for 44% of total Federal spending and are steadily rising. As Chart 1 points out, after defense and interest payments on the national debt are excluded, remaining discretionary expenses for education, infrastructure, agriculture and housing constitute at most 25% of the 2011 fiscal year federal spending budget of $4 trillion. You could eliminate it all and still wind up with a deficit of nearly $700 billion! So come on you stinkers; enough of the Pepé Le Pew romance and promises. Entitlement spending is where the money is and you need to reform it. Even then, the situation is almost beyond repair. Check out the Treasury’s and Health and Human Services’ own data for the net present value of entitlement liabilities shown in Chart 2. The above four multi-trillion-dollar liability balls are staggering in their implications. Remember first of all that the nearly $65 trillion of entitlement liabilities shown above are not some estimate of future spending. They are the discounted net present value of current spending should it continue at the projected demographic rate (importantly ­– it is much higher than the annual CPI + 1% used as a discounter because demand for healthcare rises much faster than inflation.) And while some Honorable Congressional Le Pews would counter that Medicaid is appropriated annually and therefore requires no discounted reserve, those words would surely count as “sweet nothings,” believable only to those whom they romance every several years at the polls. The incredible reality is that the $9.1 trillion federal debt that constitutes the next-to-tiniest ball in our chart is nothing compared to unfunded Medicaid and Medicare. It is like comparing Pluto to Saturn and Jupiter. The former (the $9.1 trillion current Treasury debt) does not even merit planetary status in our solar system of discounted future liabilities. It’s really just a large asteroid. Look at it another way and our dire situation becomes equally revealing. Suppose that the $65 trillion of entitlement liabilities were fully funded in a “lockbox,” much like Social Security is falsely imagined to be. Just suppose. And say the cost of that funding (Treasury debt) was the same CPI + 1% that was used to produce the above discounted present value in the first place. Actually, that’s not a bad guesstimate for the average yield of all Treasury debt. If so, then the interest expense on the $75 trillion total debt would equal $2.6 trillion, quite close to the current level of entitlement spending for Social Security, Medicare and Medicaid. What do we pay now in interest? About $250 billion. Our annual “lockbox” tab would rise by $2.35 trillion and our deficit would be close to 15% of GDP! The simple conclusion would be this: Unless you want to drastically reduce entitlement spending or heaven forbid raise taxes, then Pepé, you’ve got a stinker of a problem. Previous Congresses (and Administrations) have relied on the assumption that we can grow our way out of this onerous debt burden. Perhaps we could, if it was only $9.1 trillion, as shown in Chart 2. That would be 65% of GDP and well within reasonable ranges for sovereign debt burdens. But that is not the reality. As others, such as Pete Peterson of the Blackstone Group and Mary Meeker, have shown much better and for far longer than I, the true but unrecorded debt of the U.S. Treasury is not $9.1 trillion or even $11-12 trillion when Agency and Student Loan liabilities are thrown in, but $65 trillion more! This country appears to have an off-balance-sheet, unrecorded debt burden of close to 500% of GDP! We are out-Greeking the Greeks, dear reader. If so, and if the USA were a corporation, then it would probably have a negative net worth of $35-40 trillion once our “assets” were properly accounted for, as pointed out by Mary Meeker and endorsed by luminaries such as Paul Volcker and Michael Bloomberg in a recent piece titled “USA Inc.” However approximate and subjective that number is, no lender would lend to such a corporation. Because if that company had a printing press much like the U.S. with an official “reserve currency” seal of approval affixed to every dollar bill, that lender/saver would have to know that the only way out of the dilemma, absent very large entitlement cuts, is to default in one (or a combination) of four ways: 1) outright via contractual abrogation – surely unthinkable, 2) surreptitiously via accelerating and unexpectedly higher inflation – likely but not significant in its impact, 3) deceptively via a declining dollar– currently taking place right in front of our noses, and 4) stealthily via policy rates and Treasury yields far below historical levels – paying savers less on their money and hoping they won’t complain. If I were sitting before Congress – at a safe olfactory distance – and giving testimony on our current debt crisis, I would pithily say something like this: “I sit before you as a representative of a $1.2 trillion money manager, historically bond oriented, that has been selling Treasuries because they have little value within the context of a $75 trillion total debt burden. Unless entitlements are substantially reformed, I am confident that this country will default on its debt; not in conventional ways, but by picking the pocket of savers via a combination of less observable, yet historically verifiable policies – inflation, currency devaluation and low to negative real interest rates. Our clients, who represent unions, cities, U.S. and global pension funds, foundations, as well as Main Street citizens, do not want to be shortchanged or have their pockets picked. It is incumbent, therefore, in order to preserve the integrity of the U.S. Treasury market along with its favorable global interest rates, and to promote a stable U.S. economy, that entitlement spending be reduced, and that future liabilities be addressed in terms of healthcare and Social Security cost containment. You must attack entitlements and make ‘debt’ a four-letter word.” Thank you, and like Pepé Le Pew, why don’t you try changing your stripes or at least pretend you’re a French-speaking cat. The odor in these chambers is all too familiar and a skunk needs all the help it can get

The Swiss Franc, Euro and Gold Posted: 30 Mar 2011 10:48 AM PDT Everyone wants the Swiss Franc except the Swiss... read more

Until the Gold Price Closes Above that Last High, it Remains in a Downtrend Posted: 30 Mar 2011 10:48 AM PDT Gold Price Close Today : 1423.80 Change : 7.60 or 0.5% Silver Price Close Today : 37.501 Change : 0.517 cents or 1.4% Gold Silver Ratio Today : 37.97 Change : -0.325 or -0.8% Silver Gold Ratio Today : 0.02634 Change : 0.000224 or 0.9% Platinum Price Close Today : 1770.50 Change : 27.80 or 1.6% Palladium Price Close Today : 751.30 Change : -1.35 or -0.2% S&P 500 : 1,328.26 Change : 8.82 or 0.7% Dow In GOLD$ : $179.32 Change : $ 0.10 or 0.1% Dow in GOLD oz : 8.674 Change : 0.005 or 0.1% Dow in SILVER oz : 329.34 Change : 1.86 or 0.6% Dow Industrial : 12,350.61 Change : 71.60 or 0.6% US Dollar Index : 76.09 Change : 0.157 or 0.2% The GOLD PRICE rose a respectable $7.60 today to $1,423.80, but not enough to resolve bated-breath doubts. Until the gold price closes above that last high, it remains in a downtrend. Today it only pushed up against the $1,425 ceiling, but didn't break through. It's built firm support at $1,410, but "holding" is not "advancing," as Gen. George Patton might say. The gold price needs to gain ground tomorrow, and probably will. A close above $1,438 turns gold up, a close below $1,410 turns it down. This rally will run further. The SILVER PRICE rose 51.7c to 3750.1c, a new high close but not a new intraday high. That came at 3814c four days ago. UNLESS silver trades below 3640c, tomorrow ought to be another up day with silver progressing toward 4400c. Party could end any time, or it could rock on quite some time. Silver shows no signs of slowing down. Ratio hit a new low today, 38.002. Right now I would trade gold for silver, still, because that reaction will eventually come. The euro bounced up off its 20 day moving average and who knows, maybe it will suck all the money in the world into itself. Then again, maybe not. It reached 1.4125 today versus the last (7 days ago) 1.4244 high. Strong euro wears on the dollar of course, but the dollar is sick and sorry enough without any help from the Euro. Couldn't hold on above its 20 DMA (76.25) today and now is trading 15.7 basis points lighter than yesterday at 76.092. Dollar supporters find themselves making excuses like, "Well, yes, it is ugly and scabrous and warty, but it's made in America!" Dollar may have turned up but has as much proving to do as a drunk husband coming home at 3:30 a.m. STOCKS showed strength today. Dow rose 71.6 to 12,350.61, only about 50 points beneath the February high. S&P500 rose to 1,328.26, up 8.82 points but below the 1,344.07 February intraday high. About stocks I feel the same way all those good folks from Arkansas felt when the rest of the country elected Bill and Hillary president. The Arkansans knew what the country had fallen into, but they just wouldn't listen. ANOTHER SOUTHERN FIRST: On this day in 1842 Dr. Crawford Long of Georgia used ether anesthesia for the first time. On this day in 1870 Texas became the last Confederate state re-admitted to the union. Mmmmm. Wonder what they think about that today. MILESTONES OF AMERICAN CULTURE: On this day in 1964 "Jeopardy" premiered on US TV. 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.

Gold Price Hits Another "Real Money" High Posted: 30 Mar 2011 10:40 AM PDT The gold price just extended its 10-year uptrend with a fresh record high... read more

Gold Price Hits Another "Real Money" High Posted: 30 Mar 2011 10:40 AM PDT The gold price just extended its 10-year uptrend with a fresh record high... read more

QE 3 Coming Gold And Silver To Soar! Posted: 30 Mar 2011 10:05 AM PDT March 30 2011:  A new round of quantitative easing is on the way, Japan works to rebuild, Fed intervention in the currency markets, commodity costs move higher, Portugal in trouble, Fed doesnt help by lending to poor risks, cel networks spying, Enron investigations capped off with a fnal conviction. In today's world there is always plenty to write about and today is no exception. As far as we are concerned QE3 is on the way accompanied by almost zero official interest rates. QE1 was to bail out the financial sectors in the US and Europe and QE2 was to bail out US government debt. That is why the Fed has purchased 70% to 80% of Treasuries. Previous debt and the $1.6 trillion of new debt created this year means someone has to buy that debt and there are very few buyers. That means the Fed has to buy most of paper with funds created out of thin air in this monetization process. Those tremendous amounts of funds will most certainly increase inflation. This policy is never ending unless default becomes inevitable. That is why money and credit has to be created indefinitely until hyperinflation occurs and the system eventually collapses. It is no surprise then along with economic, financial, social and political instability that there has been a steady movement into gold and silver related assets and commodities. As long as stimulus of one form or another continues to be used the problems won't be solved and these investment vehicles will move higher and higher. Every time money and credit are created with no collateralized backing, such as gold and silver, the value of these aggregates in circulation falls, and such an endless cycle guarantees the demise of the currency and the rising value of gold and silver. Recent tragic events in Japan has brought some unexpected developments, which for the time being could lift the economy from depression at least on a temporary basis. Funds committed aggregate just under $1 trillion not the official $309 billion. We believe the funds could be raised initially in the following way: $300 billion from the postal savings plan; $300 billion from yen bonds sold in the international market and $300 billion from the liquidation of US government and other US dollar denominated securities. That is for cleanup and infrastructure. Then Japanese insurance companies, as well as foreign insurers, have to raise billions more to pay off the insured. More Here.. Low Levels Of Radiation Found In US Milk..Don't Worry?

Gold According to a Hollywood Schizophrenic Posted: 30 Mar 2011 10:00 AM PDT syndicate: 0 Author: Vedran Vuk Synopsis: Is gold in a bubble? Jeff Clark's enlightening conversation with a rapper, and some clever sound bites about gold that'll earn you points at the next cocktail party. Also in this edition: Mortgage modification schemes face euthanasia… and hedging strategies that help the Fed's PR campaign. Dear Reader, Despite the recent regulations, the government and Federal Reserve love derivatives. Well, maybe not all of them, but their best friend is the futures market for agricultural goods. Inadvertently, the companies hedging against higher food prices help out the Fed. Think about it. The Fed prints tons of money and commodity prices rise. But thankfully for the consumer, the impact won't be felt immediately – food companies have hedged against higher prices months in advance....

Gold price isn't the play, dollar's decline is, Rule tells King World News Posted: 30 Mar 2011 09:54 AM PDT 5:50p ET Wednesday, March 30, 2011 Dear Friend of GATA and Gold (and Silver): Interviewed today by King World News, Rick Rule of Global Resource Investor says he's not terribly interested in whether gold is at $1,380 or $1,420 at any particular moment. No, Rule says, the trend in which he is investing is the gradual ruin of the U.S. dollar. Rule also comments on the prospects for uranium amid the nuclear accident in Japan. Excerpts from the interview are headlined "Gold, Silver, Uranium, and Ruination of the U.S. Dollar" and you can find them at the King World News blog here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/3/30_Ri... Or try this abbreviated link: http://tinyurl.com/46c3df7 CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT 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 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: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: http://www.goldrush21.com/ 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: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT 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

In The News Today Posted: 30 Mar 2011 09:43 AM PDT My Dear Friends, Truth be told, the major theme of JSMineset has been one of self reliance in a monetary, physical and Emersonian sense. Our focus has been on your assets, your debt positions, legal matters and investment. I have, with my dear friends here at JSMineset, tried to share what we know with you. We also pride ourselves in that we not only talk the talk, but also walk the walk. Has Trader Dan not moved from Houston to an undisclosed location in Idaho? I am writing to you from a farm in North Western Connecticut, a rural part of the state. We provide our own water, can provide our own power, have a radio system fallback for communication, satellite phones, furnaces that burn coal or oil, an indoor pistol range that can take up to .50 calibre cartridges into a Detroit bullet trap, perimeter lighting, 16 camera day and night camera security and much more. We have focused on conservative financial structures which were in truth taking you into the position of being your own central bank. I have received from many people on my 70th birthday greetings plus small letters telling me how they have benefited from this link. Let me mention but two. A lady in the minerals industry lost her job and is the mother of two children and only bread winner in the house. She had very little money, but saved up a nest egg. She admits she did speculate but used the Angels. She now has $2,000,000 and has finished her period of speculation. Chris from Canada told me that his portfolio, now mostly fully paid gold and silver, is worth $5,000,000. It was nowhere near that when he started. Every effort here was to make you your own central bank which resulted in financial self reliance for many. There is one more step that you really need to consider. The housing market is in a black hole from which it very well might not recover for generations. Land is cheap. When homes or small farms have been foreclosed on, resulting in bank owned property, they are sold in a fire sale to buyers with cash in hand. Do as I have done. Do as Trader Dan has done. The pictures below are on my maple syrup operations and my build it yourself greenhouse. The vegetables for my garden are already sprouting. I have fruit trees and am adding mature nut trees. I strongly suggest that if you have benefitted from JSMineset, as many of you have, consider buying yourself a hobby farm and seriously go for the exercise of self reliance. I am certain that if even to cut costs you are going to need it. The financial system is screwed up beyond any repair. On top of that there is no desire to repair anything because the wise guys know it is impossible. It is the world that the flushing of Lehman Bros. has created. It is not a brave new world. It is more like an audition for a world of Mad Max and the Day After. It does not matter whether or not there is more QE. The damage is done and there is no solution. Earth shaking events are taking place in the Middle East that the media would have you believe is a spontaneous outburst of democracy. Like hell it is. It is a move from some sort of rule, like it or not, to chaos. Now that you are financially in good shape, please get physically self reliant. Regards, Jim   Jim Sinclair's Commentary MOPE at a grad level. 100? You have to be kidding. Add a few zeros then work from there. Dimon Says a Hundred Municipalities in U.S. Won't 'Make It' Out of Debt By Dawn Kopecki – Mar 30, 2011 2:24 PM MT JPMorgan Chase & Co. (JPM) Chairman and Chief Executive Officer Jamie Dimon said some municipalities will need to renegotiate debt and a hundred may not "make it." "I wouldn't panic about what I'm about to say," Dimon, 55, said today at a U.S. Chamber of Commerce event in Washington. "You're going to see some municipalities not make it. I don't think it's going to shatter America, I just think it's a part of the credit cycle." Speculation about widespread municipal-bond defaults intensified in December when bank analyst Meredith Whitney predicted that "hundreds of billions" of dollars of municipal bonds may default in 2011 amid pressure to balance budgets. JPMorgan, the second-biggest U.S. bank by assets, said in February its commercial bank's municipal-debt holdings are diversified enough to handle a likely increase in defaults. The number of issuers that can't manage debts may be about a hundred, Dimon said today. "It's not going to be thousands," he said. "It's going to be maybe a hundred. It's going to be a small number" out of roughly 14,000 municipalities. More… Jim Sinclair's Commentary Are you looking for our dear friend, Dean Harry Schultz? Well go no further than the Aden Sisters, for whom I understand Dean Harry writes monthly. You might be interested in the sister's take on things. The Never Ending Surge… Mar 28 2011 5:04PM Gold nearing $1500, silver at $37, oil well above $100!  What a month… what a year! We're seeing record highs in the gold price on a daily basis, silver soaring to 31 year highs day after day, while crude oil takes off, reaching 2½ year highs. LOTS OF FUEL IN THE RISE Escalating violence in Libya and spreading unrest in the Middle East is adding fuel to the already strong bull markets (see Chart 1). The threat of possible supply disruptions is providing the real fire under oil, while demand continues to grow. Gold and silver in turn are the safe havens as inflation concerns and uncertainty prevail. This turmoil will continue to keep upward pressure on these markets, but there's more to this bull market… Rising consumer prices are becoming more evident, worldwide. That is, we're now seeing the effects from a cause that's been in place for quite a while. FOOD & FIGHTS As we've previously mentioned, the cause is a sea of liquidity that has pushed all of the markets higher. This time around, soaring agricultural prices have been the most dangerous. Global food prices rose to a record. Rising food and oil are a deadly match because higher oil prices push food prices even higher. Just since last June, 44 million people were pushed into extreme poverty according to the World Bank. This alone explains why governments are being toppled. With food costs taking up a much larger portion of a families' income in the emerging world, it's understandable that surging prices helped spur the outbreak in the Middle East and North Africa. The United Nations says other countries at risk of food riots are Bolivia and Mozambique. Some say food is in a bubble, and possibly that's true, but when you consider climate change, political change and geopolitical tension, together with price inflation, we don't think a bubble is here… not yet. More…

Peering at China’s Ghostly GDP Quality Posted: 30 Mar 2011 09:38 AM PDT SBS Dateline, a TV program in Australia, is now featuring an investigation by Adrian Brown on residential and commercial ghost cities that continue to emerge in China. We've covered the South China Mall and Ordos Shi before, but the empty city of Zhengzhou New District in Henan, and the real estate developments of Daya Bay or Green Island, are new. Both Chinese sociology professor Zhou Xiao Sheng and Hong Kong-based analyst Gillem Tulloch interviewed in the piece fear growing polarization between rich and poor. Should the China real estate bubble burst, they report, significant numbers of people will be impoverished, and the chance of social unrest or revolution, often considered the Chinese government's biggest concern, will increase. You can watch the video below, which came to our attention via a post on revisiting China's ghost cities from The Mess That Greenspan Made. Peering at China's Ghostly GDP Quality originally appeared in the Daily Reckoning. Daily Reckoning founder Bill Bonner recently wrote articles on stagflation and the great correction.

Gold ends losing streak as price dip lures buyers Posted: 30 Mar 2011 09:22 AM PDT By Wallace Witkowski and Myra P. Saefong March 30, 2011 (MarketWatch) — Gold futures quit a four-session losing streak Wednesday as demand for the precious metal as a hedge against euro-zone debt worries and fighting in Libya brought buyers in at recently lowered prices. Gold for June delivery ended up $7.40, or 0.5%, at $1424.90 an ounce on the Comex division of the New York Mercantile Exchange. The precious metal touched a high of $1,431.70 an ounce early in the day, then dove to a slight loss and an intraday low of $1,413.10 an ounce before rebounding. Adam Klopfenstein, a senior market strategist at Lind-Waldock in Chicago, said many of the common themes pushing up gold still apply, such as uncertainty about the Middle East and the impact of crippled nuclear plants in Japan. "Today's move lower was rejected: There are more reasons to be a buyer than a seller," Klopfenstein said. "Fresh money likes to come in on any signs of weakness." … Standard & Poor's Ratings Services lowered its rating Tuesday on Portugal to BBB-minus from BBB, one notch above junk status. The ratings agency also cut Greece's credit rating to BB-minus from BB-plus. [source]

Tracing the Path of Social Upheaval Across the Middle East and North Africa Posted: 30 Mar 2011 09:00 AM PDT Are you watching all this, Fellow Reckoner? Now it's Syria's turn on the hotplate. Has the world gone mad? More to the point, was it ever sane to begin with? In any case, it is a breathtaking show put on for all the world to watch. Who would want to miss it? What a time to be alive! But before we get too carried away, before we get into the juicy details, let's just take a step back for a moment. This period of history is so brimming with events to inspire laughter and sorrow and everything in between. We want to be sure we give each case their just deserts. Let's start where all good tales of intrigue start, at the beginning… Imagine you're a down-on-your-luck, 26-year old college grad unable to find work in Tunisia. Your friends all have similar problems, so it's no use crying to them…you've got to earn some cash of your own. So, what do you do? How about making a little on the side selling some fruit and veg? Sounds like a viable plan, eh? Nope. No dice. When the local authorities confiscated Mohamed Bouazizi's produce (for selling without a street license) back in December, the young Tunisian was so angry he promptly set himself on fire. Overreaction? Well, self-immolation might not be the first thought that pops into most people's heads, but what do we know? We're not an out of work 26-year old Tunisian college grad trying to make a buck. And we haven't had the bulbous thumb of an oppressive dictator on our head since we were a baby. In any case, the event awakened a long-dormant undercurrent of anger, precipitating a wave of civil unrest that eventually took down the Tunisian government, ending the multi-decade authoritarian rule of US-backed president, Zine El Abidine Ben Ali. And this was just the beginning. Soon after the crowds in Tunisia began singing their songs of freedom, the tune spread to Egypt, Libya and across the Red Sea to Yemen, Saudi Arabia, Jordan and beyond. Freedom, after all, is a catchy tune. And now we see that Syria's House of Assad is on the back foot. The Assad family have been ruling the roost for four decades. That, for much of Syria's young population, is more than their entire lifetime. According to the figures, approximately one-third of Syria's 23 million people are under 14 years of age. That makes for a lot of teenage angst in the very near future. Iran's chief Arab ally may be, as The Wall Street Journal puts it, "a latecomer to the spring of Muslim discontent," but it is wasting no time making up for its tardy arrival. According to some human rights groups, more than 60 people have been killed as security forces cracked down on the demonstrations spreading around the country. In his first public speech since revolts began there almost two weeks ago, Syrian President Bashar Assad blamed "conspirators" for the violence washing over his (for now) land, for what the papers are calling an "extraordinary wave of dissent against his authoritarian rule." As usual, the papers have got it all front-to-back. There is nothing "extraordinary" about slaves rising up against oppressive masters. They always rise up…eventually. What is most extraordinary, at least to our thinking, is how long people will take it on the chin before saying "enough is enough," before they bring their gloves up, either to defend themselves…or to land a counterpunch. "We don't seek battles," Assad said in a televised speech on Wednesday, before adding, somewhat provocatively, "But if a battle is imposed on us today, we welcome it." If the people are unhappy in Syria, if they are longing for freedom across the Middle East, they were a long time silent about it. Brutal regimes have been running the place for decades. Then again, stealth is oppression's best weapon; it creeps in slowly, like a silent, invisible, lethal gas. Good people stand aside and do nothing and then, before you know it, you wake up one day to find half the population being forced to dress in cloth bags and the other half too stupefied and/or terrified to do anything about it. We have no idea whether Mr. Bouazizi is destined to become the Archduke Ferdinand of the 21st century, or how many militaristically enthusiastic nations will find the conflicts in that troubled part of the world too irresistible to refrain from joining. We do know, however, that repressed anger is generally not a healthy thing…not for individuals, and certainly not for entire generations of young men and women with a spark of freedom in their hearts. It is curious, then, that the various goings on in the Middle East (and North Africa…and Japan…and along Europe's periphery) barely inspire a whimper from the markets. Not even the scalawag shenanigans concocted in the oak-paneled halls of government buildings in Washington DC raise a questioning eyebrow from the mainstream media. The Dow Jones Industrial Average is still cruising, as if on autopilot, some 800 points above where it began the year. Neither manmade nor natural disasters seem capable of disturbing its terminally ascendant flight pattern. But, not unlike the stealthy creep of oppression, market crashes tend to remain unseen too…until the moment they become all-too obvious, when it is already too late. Joel Bowman for The Daily Reckoning Tracing the Path of Social Upheaval Across the Middle East and North Africa originally appeared in the Daily Reckoning. Daily Reckoning founder Bill Bonner recently wrote articles on stagflation and the great correction.

Rick Rule - Gold, Silver, Uranium and Ruination of the US Dollar Posted: 30 Mar 2011 08:52 AM PDT With gold and silver still consolidating, today King World News interviewed Rick Rule, Founder of Global Resource Investor now part of the $8 billion Sprott Asset Management. Rick is known as one of the most street smart pros in the resource sector. When asked about gold Rule responded, "Whether gold is $1,380 or $1,420 has absolutely no relevance to me, I think gold is part of an investment portfolio.  I think gold is part of a speculative portfolio as a consequence of its probable response to shocks to the financial system which I think are highly, highly likely.  I am a player in a trend and that trend is the ruination of the value of the US dollar." This posting includes an audio/video/photo media file: Download Now

OBAMA'S MID-TERM REPORT CARD Posted: 30 Mar 2011 08:50 AM PDT After two years of Obama…         January 2009 TODAY % chg Source Avg. retail price/gallon gas in U.S. $1.83 $3.45 88.5% 1 Crude oil, European Brent (barrel) $43.48 $115 165% 2 Crude oil, West TX Inter. (barrel) $38.74 $104 168% 2 Gold: London (per troy oz.) $853.25 $1,423 66.8% 2 Corn, No.2 yellow, [...]

Faros - US Dollar Decline to Accelerate Posted: 30 Mar 2011 08:37 AM PDT Faros Trading sent King World News this piece explaining why the US Dollar decline will accelerate. "For the past 9 months Asian reserve managers have controlled the direction and to an extent the pace of USD weakness, whether valued in terms of the USD/Index or the EUR/USD.  3 months ago they were joined by Latin American Central Banks as they sold the USDs that they were buying each day to keep their own currencies relatively weak on an export competitiveness basis.   The Latin American and Asian Central Banks have been happy to work bids in the market, passively adding liquidity rather than taking it.  They have done this by working bids below the market, relying on the market to come to them as peripheral fears, and interest rate differential changes result in bouts of USD strength.  This passive strategy of USD selling has worked for some time, and the players have been content with the pace of the move and the liquidity they have been absorbing.  The game has changed. This posting includes an audio/video/photo media file: Download Now

Will Joe Wiesenthal follow Cramer? Posted: 30 Mar 2011 08:32 AM PDT Jim Cramer the world’s most famous Paper Bug buys Physical Silver JIM CRAMER: BUY PHYSICAL SILVER Share this:

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