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Tuesday, April 5, 2011

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

Posted: 05 Apr 2011 07:11 AM PDT

Gold saw decent gains in Asia before it dipped to under $1430 in London, but it then shot up to a new all-time high of $1453.89 in New York and ended with a gain of 1.31%. Silver dropped forty cents to $38.05 in London, but it then surged to a new 31-year high of $39.198 in New York and ended with a gain of 1.69%. Both metals are rising to new highs in after hours access trade as well.

39.23 Silver

Posted: 05 Apr 2011 05:55 AM PDT

Wow, I turn my back for short time, and silver pops over 39.

This is amazing. I have no plans to buy more silver, so it should make it over 40 real soon. :rolleyes:

EVERYBODY, get your silver sammy and silver rockets photos ready.

:)

Time Machine

Posted: 05 Apr 2011 05:26 AM PDT

The wayback machine, Mr. Peabody?

This was my first PM buy of any size. In some respects, 2005 seems like yesterday but in others, so long ago.

A monster box for $4200, just showing off. And so many people I knew thought I was a raving lunatic because everyone then knew the real money was in Countrywide stock. Any one else got any saved receipts?

Does a Weak Dollar Cause Inflation?

Posted: 05 Apr 2011 05:13 AM PDT

Axel Merk submits:

Should investors be concerned that a weaker U.S. dollar causes inflation? The price at the gas pump should be a stark reminder that a weaker dollar may contribute to higher prices. Yet economists tell us that food and energy inflation does not count. Why do economists have such a baffling sense of logic? Are economists really aliens in disguise, locked up in ivory towers? Let's shed some light on the logic and why it may not merely be strange, but wrong.

First off, we are talking about the "modern" notion of inflation, rising prices as expressed in the Consumer Price Index (CPI). Historically, inflation had been considered an increase in money supply. Economists have decided to blur the term to have a more "accurate" measure of inflation. When economists embraced what some consider a conspiracy to shortchange retirees entitled to inflation-indexed social security benefits, it may have merely been an


Complete Story »

Lowest GSR in 20 Years

Posted: 05 Apr 2011 05:02 AM PDT

Chart says it all!

Sprott: Silver Is The Investment Of The Decade

Posted: 05 Apr 2011 04:57 AM PDT

Sprott: Silver Is The Investment Of The Decade

Eric Sprott's Sprott Asset Management knows a little something about investing in gold and silver, so when Sprott calls silver "the investment of the decade," those are words worth listening to.

In an interview with Mineweb, Sprott said "Silver is the investment of this decade as gold was the investment of the last decade." And it's hard to argue with that assessment as silver prices have nearly doubled in the past year and more than tripled since June 2009. Sprott, who last month said silver prices could go to $100 an ounce, told Mineweb that he does not see a gold/silver pricing ratio of 38:1 to lasting.

"So our view is that it will probably go back to 16:1 and the easiest way to imagine that is that if gold was $1,600, silver would be $100 - so that's essentially the theory that we're espousing," Sprott said in the interview. Sprott added that his firm remains "very bullish on gold," but that he expects silver prices to "treble" gold over the next three to five years.

Not surprisingly, Sprott is also bullish on silver equities. At the end of 2010, Sprott Asset Management held stakes in First Majestic Silver (NYSE: AG - News), MAG Silver (AMEX: MVG - News) and Silver Wheaton (NYSE: SLW - News) along with investments in gold miners such as Barrick Gold (NYSE: ABX - News), Yamana Gold (NYSE: AUY - News) and IAMGold (NYSE: IAG - News).

If you want to see how your performance stacks up against Sprott's or just view some of the firm's top holdings, visit tickerspy.com to see the firm's latest disclosed holdings and a chart of their combined performance.

Fun and informative, tickerspy.com is a free investing website where you can track multiple stock portfolios and compare against 250 proprietary Indexes tracking themes from dividends to ETFs to green energy to precious metals. Best of all, tickerspy.com lets you spy on the portfolios of nearly 3,000 Wall Street institutions and hedge funds and see graphs of their performance. Try tickerspy.com today and find out how you stack up against investing legends like Warren Buffett!

http://finance.yahoo.com/news/Sprott....html?x=0&.v=1

Investors Watch SLV as Silver Reaches New Highs

Posted: 05 Apr 2011 04:50 AM PDT

Michael Johnston submits:

By Stoyan Bojinov

Wall Street advanced cautiously on Monday and major indexes were trading flat for the majority of the session. Investors have a round of central bank meetings and economic data to digest this week, and likewise, trading will be heavily influenced by forward looking commentary regarding interest rates, inflation and growth. To kick the week off, the Reserve Bank of Australia announced its interest rate decision last night, and this looks to be followed up by the FOMC Minutes during the day today, and lastly back-to-back interest rate decisions from the Bank of England and the European Central Bank early Thursday morning. Gross domestic product data is also slated to come out of the eurozone and England on Wednesday, while Canadian unemployment is the last major event for the week on Friday.

As investors wait for the central bank decision to hit the wire, equities and consumers around


Complete Story »

GOP Unveils Budget Plan Cutting More Than $6T Over Next Decade

Posted: 05 Apr 2011 04:24 AM PDT

House Republicans unveiled a budget proposal Tuesday that they claimed would avert a debt-driven "economic collapse" by cutting more than $6 trillion over the next decade.

The proposal, unveiled by House Budget Committee Chairman Paul Ryan, R-Wis., would overhaul two major entitlement programs and impose caps on government spending, with the goal of stabilizing and eventually paying down the debt. It is literally trillions of dollars apart from the budget President Obama released earlier in the year, and its release marks the start of what is expected to be a drag-out budget fight in Congress...

Read

The Unexpected T-Bill Rally

Posted: 05 Apr 2011 04:17 AM PDT

Felix Salmon submits:

With time rapidly running out before the debt ceiling is reached, and doom-mongering rampant about the disastrous possible consequences of the US Treasury being unable to repay its debts, just look what's happened to the market in short-term Treasury bills!

The lack of supply was so severe on Monday, and some investors so desperate for Treasurys, that they accepted negative yields. That is something that has rarely been seen since the financial crisis.

In other words, the market simply isn't worried about short-term US debt at all. Instead, Treasuries are rallying on what the FT describes as "the collapse of a profitable arbitrage opportunity that financial groups have used to rebuild their balance sheets after the financial crisis."

Since late 2008 banks have made about $200 million by borrowing very cheaply in the repo markets and investing the proceeds at the Fed. But now the FDIC is levying its insurance


Complete Story »

The Great Confiscation: Gold ownership was illegal in the USA from 1933 to 1975

Posted: 05 Apr 2011 04:04 AM PDT

GoldCoin

EXIT SILVER? Not Quite Yet: James Turk, Gene Arensberg and Antal Fekete’s take on exiting silver.

Posted: 05 Apr 2011 03:51 AM PDT

United Mining Group Announces Bulk Sampling Results at the Crescent Silver Mine Project

Posted: 05 Apr 2011 03:03 AM PDT

United Mining Group, Inc. ("UMG" or the "Company") (TSX:UMG) (Pinksheets:UMGZF) (Frankfurt:UM8) is pleased to announce geochemical results of the South Vein intercepted by the underground bulk sampling program currently ongoing at the Crescent Silver Mine in the Coeur d'Alene district of north Idaho.

JP Morgan China: China Room to Increase Gold Reserves…

Posted: 05 Apr 2011 02:21 AM PDT

How Inflation Violates Retiree Civil Rights

Posted: 05 Apr 2011 02:18 AM PDT

Dollar Collapse

Interview With a Trading Legend, Part IV: Maintaining the Center

Posted: 05 Apr 2011 02:17 AM PDT

In Part III of this Series, we learned about the "path of least regret"… the value of long-term chart patterns… the key to triple-digit up years (and single-digit down years)… and the vital importance of staying in the game.

In Part IV we hear more about protecting trade profits… staying "centered"… the characteristics of a big trade… the truth about a trader's biggest opponent in markets… and the importance of removing the "emotional velcro" from money and trading.

This interview series is part of the Mercenary Vault, an archive of exclusive high quality materials available to Mercenary Dispatch subscribers. The Dispatch is our means of direct communication (via email) with Mercenary community members — and it's free! Sign up here and don't miss out on future exclusives.

On to Part IV…

Note: This interview segement is Part IV of a series. Also available:

JACK SPARROW: Do you ever use trailing stops or anything of that nature?

PETER BRANDT: I just categorically do not like trailing stops. I think what ends up happening with trailing stops, if trading from the long side for example, is that you end up selling where you should have been buying. And that doesn't make sense to me.

JACK SPARROW: What about the concept of moving your stop closer based on logical chart points?

PETER BRANDT: Yes, I will do that. I'm not going to give all of the profits in a trade back. I refer to trades when all of the profits are given back as "popcorn trades" in my recent book – you watch the popcorn kernel go up to the top of the kettle and then it goes right back down. I don't want to get caught in popcorn trades. It just doesn't make sense to increase risk like that.

So I've got some methods that I've built into my trading over time for taking trades off, and I use these methods. I keep an excel spread sheet that constantly shows me how the three or four trade management approaches I could use would have done on each trade. One of these approaches I monitor is the possibility of riding the trade all the way back to the starting gate – a popcorn trade. No matter which trade management method I end up using, I have a tracking of how all the optional approaches are doing. Having this information keep me centered.

JACK SPARROW: And you also stay centered by communicating with other traders.

PETER BRANDT: I've corresponded with a group of traders since 1980. I started with a one-page typed out sheet with graphs, and every Friday I would do it. The guys at Continental would want a copy, so I'd make ten and put them on the front desk. Then I'd end up making thirty copies as other traders from the Board of Trade came around, and of course it eventually went to email. I have continued to do this over the years. I weekly send out a PDF document that comments on the trades I have done as well as the trades I am looking at for the future.

As part of this communications process, every year in early January, I do what I call the "ten best dressed list." I look back over the previous year, trying not to be biased on what I traded, and it's usually not ten charts but around that number. Sometimes eight, sometimes fifteen. But the idea is just: "Oh, that was a really good chart. That was really a classical example of what charting is all about. It was a pattern, it was clear, it was big… it was on the weekly chart, it was on the daily chart, it broke out clean and ran the distance, never challenging the entry…." My intent for this annual best-dressed list is to identify the best examples of classical charting from the previous year.

Doing this every year also brings me back to the center. It says "this is what I need to do as a trader." Because without a clear reference point I'm likely to drift. I don't want to drift. I want to bring myself back to what I really need to be doing. And that is looking for those patterns that are going to be on that list, because that is where my money is going to be made.

JACK SPARROW: So the best dressed list is like a north star for your profitability.

PETER BRANDT: Yes, I would say that over the years about 50% or more of my net profits have been from chart patterns that ended up on a best dressed list. It also goes back to controlling risk, and getting to where my head is in the game. When my thinking is ahead of the game, then I can see something on the charts and say, "Okay, this market just can't be set up any better. I know this chart is going to be on the best dressed list." Intuitively I just know it. Of course, there are times when my intuitive thinking proves to be wrong.

So because I focus on finding big chart patterns, I am in a position to identify situations like that, and the chart breaks out a certain way, and the way it breaks out technically provides an opportunity for very small risk (chart risk), and a number of other factors line up. That's when I say, "Back up the truck." I even have a recording on my computer, the 'beep beep' noise of the truck backing up. I sometimes send it to another trader I work with – when I see something really good, I send him the link to the beeping truck.

So I get the trade set up, and the truck is beeping, and I say "I'm not going to risk 50 basis points… I'm not going to risk 100 basis points… I'm going to risk 200 basis points." Not only that, but because of the chart risk I can have four or five contracts per unit of capital, where typically I may only be trading one contract per unit of capital

JACK SPARROW: Because you've got such a narrow band.

PETER BRANDT: Yes. Then we get a good strong day… it's a good strong bar that breaks out and holds the breakout… the market may slightly back off for two or three days and volume just dries up to nothing… then you get what Wyckoff called a hinge day, super-small range day… a close in the middle of the trading range where you find out there was no volume at all… then I put some more on.

It is getting two or three trading situations like this that can give a trader a 100 percent or better year. And it has been market setups like this that have given me my best years. For me, I have not had great trading years because I was right fifty or sixty percent of the time. I have had the really great years when I was able to exploit two or three trades where I was really able to lean into the trade with my shoulder and push. It's those gems that really pay the dividend. I know that if I'm going to finish with better than a fifty percent return in a given year, it means I caught some really nice trades.

So, I always anticipate that around the next corner there's going to be another great trade. I also anticipate that each and every year will offer me at least 10 charts that can wear the title of being on the best dressed list. And most years this happens, but not all years. I have to admit that there have been some years when either the really great trades did not happen, or they did happen and I missed them. I have been in a drought in recent months for really good trades.

JACK SPARROW: Back to this idea of being centered – what are some of the dangers that take you away from the center?

PETER BRANDT: Bad spells come and go naturally in markets. What I don't want to do is add to bad markets. In my way of trading I tend to look at markets a certain way, analyze markets in a certain way, and have certain ways I get in and get out. So it's possible that the way I trade is out of sync with the markets. But it is also possible that I am out of sync with the way that I'm supposed to trade.

That is the quicksand I have to stay away from. I have to make sure I execute my game plan in the right way, which is just a matter of being disciplined, always questioning, "Is this a trade I ought to be doing," not reading anything into the chart that is not there. As Reminiscences of a Stock Operator talks about, just reading the tape.

There are some trades that fall into a gray area. If you are a discretionary trader, which I am, you are going to have a certain number of trades that don't fit neatly into a box. What do you do with those? You have to pay attention to the trades you have on.

The real opponent of a trader is himself. Not the markets, not other traders down the street, not some commercial house – my opponent in the market is Peter Brandt. Am I doing what I know I need to do to put myself in a position where I know I can either be down six percent or up a hundred.

MIKE McDERMOTT: Going back to something earlier… you talked about having the "license to fly" when you left the advertising agency, and following that, the point of critical mass where you felt you had truly become a trader. During that build-up phase, you had Campbell Soup as a customer helping to cover your bills. How did the financial stability of having that income affect the trading decision-making process?

PETER BRANDT: It was huge. The Campbell Soup income is what helped me become a consistent performer. By consistent performer, I don't mean someone who is hitting their number every year. To me, a consistent performer is someone who can stay in that acceptable minus-five to plus-100 range and do what they need to do.

Consistent performance isn't necessarily based on the dollars you make, but on the things you need to do to perform – repeating and repeating what you think are your best practices. The goal is to be a consistent performer and then let the money take care of itself.

This is a roundabout way to answer your question. But where the financial stability becomes important is that, if I feel like I need to make $4,000 this month for living expenses, or $8,000 this month or what have you… that my tax bill is due or that I need to put a new furnace in my home… or that my wife wants a new Subaru Outback… all of a sudden I've taken my trading capital and put dollar signs on it related to things that need to be bought. I've attached emotion to my capital. In my mind it is so important not to have any emotional propping up of trading capital. Trading capital needs to be just numbers, a way to keep score.

The subject of money has emotion. Money has as much emotion for a lot of people as do their wife and their kids and their parents. If you want to get people emotional, bring up the subject of money. So if you're not just cold-hearted – and I'm not cold-hearted – then I have to find ways to move myself away from all the emotional stuff that sticks to money. Money just seems to have emotion-attracting velcro on it. I have to find ways to cut the velcro off. I have to view my capital as just part of the game. The degree to which I am emotional about my capital can be the degree to which I start trading defensively. And defensive trading usually goes in the wrong direction.

I also even need to detach myself from what I'm trading. I'm not trading corn, I'm trading price. It is also important for me to detach myself from price itself. It shouldn't matter if I am buying beans at fifteen bucks or six bucks. All that matters is, are beans going to go up? If so, who cares where the price level is. Some of my worst trades have been talking myself into buying something that was cheap.

I do not want my trading capital to be assigned in such a way that: "This chunk has to go for rent, this chunk has to go for a car, this chunk has to go for education." I want to get rid of all that, which is why it was so important to have the Campbell Soup revenue at that stage in my career, or to have had that back-up game plan of returning to advertising, because then I don't have to worry about needing to use trading profits for living expenses.

To be continued…

Forget the Fed's lies... The Bank of Japanjust explained the real reasons commodities are soaring

Posted: 05 Apr 2011 01:22 AM PDT

From Pragmatic Capitalism:

If you've been looking for an honest assessment of the recent commodity rally, look no further than this bit of research by the BOJ.

It provides a broad overview of the factors that are currently impacting commodity prices, and concludes with a practical and fact based argument – global central banks, the financialization of commodity markets, and supply/demand mechanics are all working in tandem to cause a perfect storm in commodity prices.

They write...

Read full article...

More on commodities:

Jim Rogers: Don't buy gold now

Marc Faber: Sell stocks now... buy this instead

Forget gold... One of America's favorite commodities is headed to all-time highs

Resource guru Sprott: Silver to rise three times higher than gold now

Posted: 05 Apr 2011 01:18 AM PDT

From Mineweb:

According to Sprott Asset Management CEO Eric Sprott, Silver is the investment of the decade. Not only is it likely to reach $50 an ounce by the end of the year, but, he says, over the next three to five years, it's performance is likely to treble that of gold's.

Speaking on Mineweb.com's Metals Weekly podcast, Sprott said, "We've been huge proponents of gold over the last 11 years, and we've been involved in silver over that same time period. But beginning about a year ago it became extremely evident to us that the investment demand for silver was...

Read full article...

More on silver:

The world's greatest silver stock could soon be even better

Top precious metals analyst: Be careful buying silver today

Resource guru Sprott: "Three-digit price" for silver coming soon

Silver "Diverts Attention from Gold" as Chinese Hike Puts Global Interest Rates "In Focus"

Posted: 05 Apr 2011 01:14 AM PDT

Silver Still Trending

Posted: 05 Apr 2011 01:03 AM PDT

We are still biding our time here at Got Gold Report, waiting patiently for opportunity, having built up our Bargain War Chest and having reduced size in a number of our small resource company positions in the period between November and March. While we wait for the Opportunity Gods to become more benevolent, we thought today would be a good day to share the long-term silver chart we first started using last year and last updated in February. Here it is again, with the price data updated, but with our February 12 commentary unchanged.

Best selling methods

Posted: 05 Apr 2011 12:26 AM PDT

If your local dealer is not going to cut it. What are some other options for selling PM? (Besides ebay and craigs list)

Gold and Silvers Daily Review for April 4th, 2011

Posted: 05 Apr 2011 12:26 AM PDT

Gold Forecaster

Hello everybody...(no where else to post)

Posted: 04 Apr 2011 11:42 PM PDT

I've been reading these forums the about a week now and I've decided to join. I was going to introduce myself in the beginner forums but it seems as though that part of the forum isnt used as much...So, I have decided to post in here since I'll probably find myself in this section the most. Anyway, lots of good information on here and I plan on purchasing some silver this weekend!

Thanks,
Q

Silver demand huge, supply small, Sprott tells King World News

Posted: 04 Apr 2011 09:03 PM PDT

Silver demand huge, supply small, Sprott tells King World News

Here's a GATA release from yesterday that's a must read.  Eric also talks about $2,000 gold as well. The blog...and Chris Powell's preamble...are linked here.

Sprott Physical Gold Trust Announces Follow-on Offering of Trust Units

Posted: 04 Apr 2011 09:03 PM PDT

Sprott Physical Gold Trust Announces Follow-on Offering of Trust Units

Sprott has launched a follow-on offering of transferable, redeemable units of the Trust ("Units") in an aggregate amount of up to $340 million at a price of $12.54 per unit (the "Offering"). Certain lead investors, including certain funds managed by Sprott Asset Management LP, have agreed to purchase no less than $115 million of Units in this Offering.

The Trust will use the net proceeds of this Offering to acquire physical gold bullion in accordance with the Trust's objective and subject to the Trust's investment and operating restrictions described in the prospectus related to this Offering.

read more

Sumitomo Workers Lift Strike at San Cristobal Silver, Zinc Mine

Posted: 04 Apr 2011 09:03 PM PDT

Sumitomo Workers Lift Strike at San Cristobal Silver, Zinc Mine

Here's a short piece that was posted over at Bloomberg yesterday...and it's courtesy of Washington state reader S.A.  The headline sums it up pretty well...and the link to this very short story is here.
at

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