Gold World News Flash |
- Gold Rockets Higher While Munich Listens To GATA
- Washington DC has become a Significant Risk to Investors’ Portfolios
- Gold Market Update
- International Forecaster April 2011 (#9) - Gold, Silver, Economy + More
- SLA retakes $45. Margin rates are meaningless to the SLA – WE ARE CASH BUYERS AND WILL KEEP GOING UNTIL SILVER HITS $500
- “Since none of the actual fundamentals before the long-term trajectory in silver (and gold) have changed, this appears like a rather attractive entry point.”
- Is the Obama/Osama dollar rally over?
- Paper silver has a bit of a kerfuffle. Paper bad guy Osama back in the news. Paper president Obama scores big laughs at dinner for papers (is this the worst stunt to try and improve poll ratings EVER!).
- SLA takes heavy sell order artillery from US dollar terrorists
- “At this point there is an outright scramble to get anyone with margin out of precious metals positions.”
- Think Or Swim Hikes Silver Margin To Double That Of CME
- Be Thematic In Your Approach
- JP MORGAN DESPERATE IN LOSING SILVER BATTLE
- Investors Missing the Boat on Gold and Silver Explorers
- GGR Silver Graph
- An Unstable Economy Wobbling Atop Unsound Money
- Alasdair Macleod: Bernanke is boxed in
- Weekly precious metals review at King World News
- Grant Williams: The ‘next big trade' may be precious metals again
- Prosecutors investigate market manipulation through quote stuffing
- Garry White: Obama's weak dollar, not ‘speculators,' to blame for oil spike
- Hot Springs 5 Ounce Silver Uncirculated Coin Nears Sell Out
- COT Silver Report – April 29, 2011
- More On The Silver Dive: "Massive Sell Orders" Coupled With Bolivian Nationalization Halt Combine For Perfect Weak Hand Shakeout Storm
- Gold Market Update - May 01, 2011
- Silver Market Update - May 01, 2011
- Portrait of Desperation
- A Sunday Vertical Drop of Gold, Silver, Platinum and Palladium
- Market Turning Points Weekend Report
- Gold - Jumping the Track Or Reaching a Routine Target?
| Gold Rockets Higher While Munich Listens To GATA Posted: 02 May 2011 04:11 AM PDT For the second time in a week the CME raised margin requirements on silver ... Thursday after the Comex close. While The Gold Cartel requests timed tactics such as these to assist their price-capping efforts, this move is very understandable as silver rose more in a single trading session than the old margin requirement the other day. Thus, it was very appropriate for the exchange to raise margins on silver…
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| Washington DC has become a Significant Risk to Investors’ Portfolios Posted: 01 May 2011 07:34 PM PDT S&P’s warning on the US credit rating and the subsequent refusal to acknowledge the problem should give investors pause. The inability to tackle the budget deficit and debt problem is causing the Dollar to selloff and head towards levels not seen since late 2009.
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| Posted: 01 May 2011 07:17 PM PDT The interesting thing about gold is that although it has been in a steady long-term uptrend there has still been no meltup, such as we have seen in silver, but if the dollar really caves in that could very well happen - and such a meltup may have just started this past Friday.
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| International Forecaster April 2011 (#9) - Gold, Silver, Economy + More Posted: 01 May 2011 07:16 PM PDT We are supposed to be two years into an economic recovery. Tell that to those with stagnant wages who have to fight against 10% inflation, which our government ingeniously tells us, is 1.9%. Some $900 billion or more will have been created out of thin air by the Fed and spent buying Treasury and Agency bonds, notes and bills and the $862 billion consigned to the economy in December will all have been spent. We are about to enter the next round in June. Will there be austerity or rampant inflation, the result of $1.8 trillion in spending, or will we get trillions more funding from the Fed? We think we will get the funding, because little help can come from Congress. If such events unfold you can expect an upward move in real interest rates to offset a negative rating and more injections of money and credit.
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| Posted: 01 May 2011 06:51 PM PDT Share this:
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| Posted: 01 May 2011 05:56 PM PDT More On The Silver Dive: "Massive Sell Orders" Coupled With Bolivian Nationalization Halt Combine For Perfect Weak Hand Shakeout Storm Share this:
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| Is the Obama/Osama dollar rally over? Posted: 01 May 2011 05:29 PM PDT I never thought I'd see the day a sitting U.S. president tries to manipulate the market in such an obvious manner using nonsense and bullshit on TV, but wonders never cease. Obama has become a penny stock scam artist. Is … Continue reading
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| Posted: 01 May 2011 05:14 PM PDT Share this:
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| SLA takes heavy sell order artillery from US dollar terrorists Posted: 01 May 2011 05:03 PM PDT Silver Plunges On China Slowdown Concerns, Dollar Short Covering Share this:
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| Posted: 01 May 2011 04:56 PM PDT Think Or Swim Hikes Silver Margin To Double That Of CME Share this:
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| Think Or Swim Hikes Silver Margin To Double That Of CME Posted: 01 May 2011 03:29 PM PDT
On Friday we reported that MF Global hiked silver margins to roughly $25k per contract (following the CME's own two consecutive margin hikes of 9% and 10%). On Sunday night, not letting any public hysteria go to waste, Think or Swim follows suit and hikes the /SI margin to $30,037.50 and $6,007.50 for the /YI. At this point there is an outright scramble to get anyone with margin out of precious metals positions, which of course in the long run will merely reinforce the holding hands.
h/t Biff Malibu
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| Posted: 01 May 2011 03:19 PM PDT By Richard Mills, Ahead of the herd As a general rule, the most successful man in life is the man who has the best information When looking for a dominant investment theme the approach I take involves looking at global or big picture conditions. I study trends, read the news, basically watch and listen to what's going on in the world. What I'm looking for is something so powerful, so dominant, it's going to be my guide to where I invest – I focus on the factors that I think will drive headlines going forward. If you had used this approach almost a decade ago (and were to use it today) to try and identify major long term trends within which you can see long term opportunities you would have to come to the conclusion that the resource sector looks especially attractive/lucrative. In the resource sector there were, and still are, considerable opportunities presenting themselves – investable themes always blossom from these major trends. Three examples:
After identifying the major themes you need to study the different sectors in order to select the one that you think is going to match up well and outperform the rest.
The next step would be to find individual Lithium, Potash and Uranium company's – based on the quality of their management teams – and make an early, well timed ahead of the herd investment. After you've made your investment, you need to show some patience and let your chosen management team, and the trend, go to work for you. Watch and wait. If you've made the correct decisions, management conducts successful programs, does a creditable promotion job and the trend continues, you will reap considerable rewards. This is "Top Down" investing and in this author's opinion is the most rewarding way to invest. Most people do not seem to realize that today there are two easily identifiable, and easy to follow over riding dominant global factors from which all of today's investable themes are blossoming. Each and every one of us, as investors, has to be aware of what is going on – we need to know the influencing factors on the economy and what is going to be influencing investor sentiment by driving headlines. Knowing what these dominant themes are, and understanding their effects, will help every investor decide where to place their money and see the inevitable corrections along the way as either a buying opportunity or perhaps that the end of that particular investment theme is near and it's time to head for the exits. Urbanization Migration is defined as: the long-term relocation of an individual, household or group to a new location outside the community of origin. Today the movement of people from rural to urban areas is most significant. Migration cause can be explained two ways: Push factors – conditions in the place of origin which are perceived by migrants as detrimental to their well being or economic security. Pull factors – the circumstances in new places that attract individuals to move there. Unemployed, poor and hungry (push factor) people from rural areas are attracted to cities because cities are perceived to be places where they could make more money and have a better life (pull factor). During the 19th and early 20th centuries urbanization heavily contributed to industrialization. Job opportunities in the cities caused the mass movement of people from the country to the city. These rural to urban migrants provided cheap and plentiful labor for emerging factories. Urbanization is a macro-trend, in 1800 two percent of the global population was urban, by 1950 it was 30%. Today half of all the people in the world live in cities. This is an economic migration – historically poverty rates are 4 times higher in rural than urban areas. The UN projects that by the year 2030 there will be 1.5 billion more people living in cities. Nowhere is this rural to urban migration – and a higher degree of industrialization – more evident today than in China and India. Chinese urbanization China has set a goal of 65 percent of urbanization rate in 2050. Over the coming 40 years that means 20 percentage points of urban growth per year. This translates into 300 million rural residents becoming urban residents over this time period.
"The growth potential of the vast middle and western regions, together with the rapid development of small cities and towns, could keep the economy on the fast track for at least 15 to 20 years." Wei Houkai, director of the center for China's regional development at the Chinese Academy of Social Sciences (CASS) China's economy expanded at 9.8% in the quarter ended December 31st 2010. "China's GDP growth continued at a blistering pace during the first quarter of 2011, rising 9.7% from the previous year, according to economic data released by the People's Bank of China. Once again this outpaced many forecasts – even that of the Chinese government – and reignited the discussion of China's overheating economy. While its robust growth may raise a few eyebrows, the economy isn't in danger of red-lining." Will China's Economy Overheat? Frank Holmes, CEO and chief investment officer US Global Investors, India's Urbanization "Every major industrialized country in the world has experienced a shift over time from a largely rural agrarian-dwelling population to one that lives in urban, nonagricultural centers. India will be no different. However India's urbanization will be on a scale, that outside of China, is unprecedented." McKinsey Global Institute's report India's Urban Awakening India has 1.2 billion people and the second largest urban system in the world – currently 340 million people. Less than 60 percent of the households in India's cities have sanitation facilities, and less than half have tap water on their premises. The share of the urban population in India is expected to reach 40% by 2021, and by 2011, urban areas could contribute around 65% of GDP. A report done by the McKinsey Global Institute called India Urban Awakening predicts that 590 million people or 40% of the population will live in cities by 2030 up from 340 million today. By that time, Asia's third largest economy would have 68 cities with populations over 1 million, up from 42 today. With less than 1/3 of the population India's urban areas generate over 2/3 of the country's GDP and account for 90% of government revenues. India's economy expanded at 8.9% in the quarter ended September 30th 2010. Out of Control Spending The federal deficit this year is a record $1.6 trillion — a number that requires the government to borrow 43 cents out of every dollar it spends. The US government's total debt will mushroom from $14.2 trillion now to almost $21 trillion by 2016. Obama's projected $1.6 trillion deficit for the current year would be the highest dollar amount ever. It represents 10.8 percent of the total economy, the highest level since 1945 when the deficit was 21.5 percent of GDP and reflected heavy borrowing to fight the Second World War. The president's 2012 budget projects that the deficits total $7.2 trillion over the next 10 years with the shortfalls never coming in below $607 billion. Professor Peter Bernholz, from the University of Basel, examined 12 of the 29 hyperinflationary episodes where significant data exists. "Hyperinflations are always caused by public budget deficits which are largely financed by money creation…The figures demonstrate clearly that deficits amounting to 40 percent or more of expenditures cannot be maintained. They lead to high inflation and hyperinflations." Most analysts quote government deficits as a percentage of GDP: "The president's projected $1.6 trillion deficit for the current year…would also represent 10.8 percent of the total economy." This reporting is misrepresenting the true size of the problem because it doesn't say how big the deficit is relative to expenditures. On February 14, 2011, President Obama released his 2012 Federal Budget. The report updated the projected 2011 deficit to $1.645 trillion. This is based on estimated revenues of $2.173 trillion and expenditures of $3.818 trillion. He then unveiled a $3.73 trillion budget for 2012 with a projected deficit of $1.1 trillion – a lot of savings/cuts and revenue assumptions in the 2012 budget appeared to this author, to put it politely, to be pie in the sky. The savings and revenue projections have more to do with the 2012 election than reality – Obama is trying to appear fiscally responsible to the voters. It also doesn't look like either party can agree to any cuts except to those in someone else's (that somebody being from the other party) back yard. The US government cannot sell enough of its debt to its own citizens and foreigners to finance its deficit and pay the interest on its existing debt. "Yes, we are monetizing debt. You buy bonds and you monetize debt. Right now, a lot of that is going into excess reserves so it is not having an immediate effect on inflation. It will initiate inflationary impulses. It takes time." Thomas Hoenig,President,Federal Reserve Bank of Kansas City, early March 2011 The US government is already buying its own debt – this is the most inflationary thing a country can do – and it looks like we can expect this trend to continue and probably increase. On April 27th 2011 the Federal Reserve Open Market Committee (FOMC) announced it will continue to purchase government securities – including reinvesting principal payments from its holdings – and confirmed its accommodating policies may continue for quite a while. FOMC downgraded their economic growth forecast, acknowledged inflationary pressures have moved from commodity inflation to core inflation and said inflation remains too low. It should not be a surprise if the U.S. dollar weakens further - when a central bank wants higher inflation they'll get what they wish for. Conclusion
It's quite obvious urbanization is the driving force behind global commodities demand and inflationary pressures have moved from commodity inflation to core inflation. Both urbanization and inflation look set to continue for the foreseeable future. Of course there will be corrections but the dominate themes are set, the trend is clear. And there are other factors influencing the supply side of the equation. PDAC curse, sell in May and go away, unusual amount of financings done late last year and investors are chewing through a wall of paper – pick your reason – A, B, C or D all of the above – the fact is junior resource companies – the owners of the worlds future mines – are on sale a little earlier than normal this year. If you like their management team, and their plans for 2011, than perhaps now is the time to be slowly acquiring a position for this summer's work programs in anticipation of fall results. Two factors – developing countries urbanization and US$ weakness – are so overwhelming driving the global economy and their effects are so in-sync with each other that investments in two sectors – commodities and precious metals – should be on every investors radar screen. Is it on yours? If not, maybe it should be. Richard (Rick) Mills If you're interested in learning more about the junior resource market please come and visit us at www.aheadoftheherd.com Membership is free, no credit card or personal information is asked for. *** Richard is host of www.aheadoftheherd.com and invests in the junior resource sector. His articles have been published on over 200 websites, including: Wall Street Journal, SafeHaven, Market Oracle, USAToday, National Post, Stockhouse, Lewrockwell, Casey Research, 24hgold, Vancouver Sun, SilverBearCafe, Infomine, Huffington Post, Mineweb, Resource Investor, 321Gold, Kitco, Gold-Eagle, The Gold/Energy Reports, Calgary Herald, Resource Investor, FNArena, MetalsNews and Financial Sense.
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| JP MORGAN DESPERATE IN LOSING SILVER BATTLE Posted: 01 May 2011 02:12 PM PDT JP Morgan is getting desperate. They will fight dirty. I hope silver drops under $40. I will buy with both hands to help put a stake in Jamie Dimon's heart. Bring it bitchez!!! More On The Silver Dive: "Massive Sell Orders" Coupled With Bolivian Nationalization Halt Combine For Perfect Weak Hand Shakeout Storm Submitted by [...]
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| Investors Missing the Boat on Gold and Silver Explorers Posted: 01 May 2011 02:07 PM PDT By James West, Midas Letter.com Gold's apparently effortless breach of the $1,500 mark, accompanied by its staunch ally silver towards $50 an ounce, marks new territory for the Age of Monetary Metals, which we have now entered. The twin frauds, the artificially high valuation of the U.S. dollar and the equally nefarious intervention by the Chinese to keep the Yuan down, are driving the world's savers increasingly towards the only transparent (well, except for the increasingly flaccid derivatives market price manipulation) and trustworthy monetary unit. At this point, I'm embarrassed to be a human being. What will posterity say about this era in history, where a small cadre of over-educated men and women perpetrate simultaneous scams against the rest of us to support an undeserved sense of entitlement expressed in grossly excessive lifestyles? Where are the protests in the United States? What happened to the American spirit, that historically rose up against oppression and enslavement? In China, the fear is palpable. They're even barring access to churches, which, unfortunately for the present regime, is the great error repeated throughout history. Steal their money, deny them a decent standard of living, sure, but deny them access to their God? A fatal error, my Chinese friends. In America, it would appear that the obsession with microscopic partisan philosophy differences and dogma undermines any possibility of a united electorate behind issues of grave and imminent import. It's a distraction of the highest caliber, and a perfect example of how the current model of human beings can easily occupy itself with senseless superficiality while the stage upon which they debate is incrementally consumed by termites. Completely transfixed by spectator sports, utterly mindless video games, vapid entertainers, and formulaic and insipid movies, and a hundred thousand talking heads all delivering variations on the Great Lie of the once great United States, America is doomed. 300 million puffed up roosters strutting around indignantly in what was once a resource rich land of promise but is soon to be nothing more than an abattoir from sea to shining sea. What a surprise it will be when the fences erected to keep the outsiders out turn out to be fortified by the outsiders to keep the insiders in. And still, the financial services industry, now a juggernaut smashing the financial infrastructure of the world to smithereens under its own colossal inertia, defecates a steady stream of worthless and impoverishing investment products on the oh-so-thoroughly anesthetized and distracted American investing public. The collateralized debt obligations and securitized junk loans have been refined and retuned and now re-appear as triple A trash among the cleverly adorned offerings of Morgan Stanley, Goldman Sachs and J.P. Morgan. Poor, poor, mainstream investors. How horrible it must be to be an investor and not know anything about investing in the Toronto Venture Exchange (TSX Venture) and Toronto Stock Exchange's (TSX) vast selection of gold, silver and oil explorers and producers. How impoverished must be the millions of global investors making due with single digit gains, if any, and more commonly, losses at the hands of major investment banks who load their portfolios with garbage. It still ranks as a well kept secret, the phenomenal gains being realized by astute investors on these Canadian exchanges, where nearly 80% of the world's natural resource investment capital is raised and directed into projects from Tasmania to Alaska. A case in point: Newstrike Capital (TSX.V:NES, OTCBB: NWSKF.PK), a Midas Letter pick from our January 2011 edition that our subscribers picked up for $1.20 a share, announced on April 20th that one of their drills had intercepted over 230 metres (755 feet) of mineralized core on the company's Ana Paula project in Guerrero, Mexico that graded an average of 7.5 grams per tonne of gold. The stock promptly doubled, providing those who bought at $1.20 with an immediate 100% gain, in a mere three months. That's 400% performance annualized. Now granted, Newstrike is the exception rather than the rule. TSX and TSX Venture stocks with major discovery potential tend to appreciate more slowly, and the intercepts encountered by their drilling programs are rarely so dramatic. And quite frequently, the progress of share price appreciation is inhibited by the unfortunate realities associated with financing exploration activity. By the time a company who is exploring for gold and silver starts hitting the large high grade intercepts that translate into demand for the company's shares, that company has likely issued a large number of shares to raise the money to get to that point. A good example of this is Seafield Resources Ltd. (TSX.V:SFF), whose announcement on December 2nd, 2010 of a drill intercept grading 1.29 grams per tonne over 449 metres. The stock shot up to a high of $0.77, but the company announced a financing of 30 million shares at $0.50, which effectively killed the rally. At the same time, millions upon millions of shares from previous financings flooded the market, and the stock to this day labours in the $0.30 range, despite further outstanding drill and trench results. Fortunately, while lousy financing structures taint the share price, beneath the ground the deposit remains intact. That being said, there is clearly some substantial mineralization present on the property, and once the insiders and early investors who are in a big hurry to dump their cheap shares have done so, it is likely the company will proceed to develop the group of deposits on their Quinchia project in Colombia. It is worthy of note that the 30 million share private placement was subscribed for by the same parties who were substantial early shareholders of Ventana Gold. (TSX:VEN), a company that delivered over 1000% performance in the space of less than one year. There are a multitude of examples, however, of companies whose incremental share price increase in a one year time horizon demonstrate the conviction, by investors, that there is a valuable mineral deposit underlying the demand for shares. On the TSX Venture exchange alone, more than 400 out of 1600 companies in the resource sector have doubled in value in one year or less. Imagine 25% of your investments doubling in one year! And in Canadian dollars to boot! While the rest of the markets quiver on the brink of collapse, and investors wait with baited breath for the next financial crisis to arrive (really its still the same crisis that started in 2008 – just delayed thanks to the U.S. government counterfeiting program), wise investors are building positions in junior gold exploration companies with good exploration results, because these will be the biggest beneficiaries of investor interest when the mainstream finally realizes that the TSX and TSX Venture exchanges are the absolutely best speculative games in town. **********************************************************************************
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| Posted: 01 May 2011 02:02 PM PDT With silver under pressure in early Monday trading this late Sunday evening (in the U.S.) we thought we would share one of the linked GGR graphs that Vultures (Got Gold Report Subscribers) have access to. Just below is the GGR 2-year weekly graph for silver.
Just below is an early press account of the Asian sell-down for precious metals via Reuters. http://af.reuters.com/article/metalsNews/idAFL3E7G200J20110502 Vultures can log in and review about a dozen technical charts for gold, silver, the HUI, CDNX, GDXJ and several key ratios, which were all updated by the usual Sunday time target of 18:00 ET. That is in addition to our nine Vulture Bargain companies and about ten Vulture Bargain Companies of Interest (VBCIs) - companies we are interested in attempting to game in the upcoming Vulture Bargain Hunting Season. That is all for now, but there is more to come.
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| An Unstable Economy Wobbling Atop Unsound Money Posted: 01 May 2011 01:54 PM PDT It's a clumsy old thing, that all-knowing, all-seeing government. No matter how hard it (says it) tries to "fix" the problems of the world, to the extent that the state intervenes, things only seem to get worse. Let's start with the economy… This week we heard from Chairman Bernanke about how his "on sound footing" recovery (somehow, remarkably, standing atop unsound money) is beginning to falter. The recovery, says he, is now "moderate," requiring the Fed to maintain their historically low interest rates for "an extended period." More unsound money, in other words…designed to build a surer foundation on which to erect that ever-illusive recovery. So, are investors actually buying the Chairman's newspeak? At the very moment The Bernank was busy proclaiming his commitment to a "strong dollar policy," the dollar index hit a brand new, post-2008 recession low. Strange, no? What about precious metal investors? Are they betting on The Bernank? The price of gold says, emphatically, NO! An ounce of the anti-dollar metal this week hit $1,560…although, by the time you read this, it may have already moved higher. (Of course, for our purposes, it's more correct to say that the dollar actually slid to 1/1,560th an ounce of gold…but that's a tale for another day.) And what of those other anti-dollar investments? Silver is back up to $48 an ounce and crude (West Texas Intermediate) climbed back above $113 per barrel. Of course, Bernanke tells us this high price will be a temporary phenomenon. Yes…and spending money to get rich is a sound financial plan, too. No, Fellow Reckoner, the powers-that-be are not here to fix your problems and cure your ills. They're here to cause, induce and exacerbate them. They fiddle with this sector and stimulate with that one, trying to get the "machine" to correct its course. But every time they hit the accelerator, the wheels fall off and the engine stalls. Individual components seize up and cease to work. And so the wonks scratch their heads and go back to the same old drawing board. They fret that unemployment is too high or that the growth rate is slowing…and presume to know what to do about it. Take GDP, for example. As you might have seen, this rather meaningless "measurement" contracted during the first quarter of the year, down to 1.8% annualized from a 3.1% rate the previous quarter. It was the "worst" showing since last spring, the (thus far) height of the European debt debacle. Astute readers can already see here how the measurers and fiddlers have missed the point altogether. Then again, to our recollection, they've never displayed a shred of evidence that they grasped it in the first place. First of all, there is no "machine"…no "economy" of which to speak. Not in the sense they are expecting, anyway. There is no economy that isn't comprised of individuals and their reliably untamable, unforecastable, untinkerable aspirations and desires. As Frank Shostak, an adjunct scholar of the Mises Institute, puts it, "The GDP framework gives the impression that it is not the activities of individuals that produce goods and services, but something else outside these activities called the 'economy.' However, at no stage does the so-called 'economy' have a life of its own independent of individuals. The so-called economy is a metaphor – it doesn't exist." And thus is this fundamental flaw of the orderers' and meddlers' plans laid bare for all to see. They are tuning something that can't be tuned, trying to create demand – along with dollars – out of thin air, rather than allowing the market to respond to the wills and desires of its many millions of participants. This is their error, one F.A. Hayek so eloquently referred to as "The Fatal Conceit." And with that, we'll leave you with a bit of entertaining weekend viewing, courtesy of the good-humored people at econstories.tv Regards, Joel Bowman An Unstable Economy Wobbling Atop Unsound Money originally appeared in the Daily Reckoning. The Daily Reckoning recently featured articles on stagflation, best libertarian books, and QE2 . More articles from The Daily Reckoning….
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| Alasdair Macleod: Bernanke is boxed in Posted: 01 May 2011 01:53 PM PDT GATA 1p ET Sunday, May 1, 2011 Dear Friend of GATA and Gold (and Silver): Economist and former banker Alasdair Macleod, who will speak at GATA's Gold Rush 2011 conference in London in August (http://www.gata.org/goldrush2011-london), reviews Federal Reserve Chairman Ben Bernanke's press conrerence and concludes that the markets figure that the Fed has opted for inflation to save the banking system. Macleod's commentary is headlined "Bernanke Boxed In" and you can find it at GoldMoney here: http://www.goldmoney.com/gold-research/bernanke-boxed-in.html CHRIS POWELL, Secretary/Treasurer 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: To contribute to GATA, please visit: http://www.gata.org/node/16
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| Weekly precious metals review at King World News Posted: 01 May 2011 01:53 PM PDT GATA 7:17p ET Saturday, April 30, 2011 Dear Friend of GATA and Gold (and Silver): The weekly precious metals review at King World News finds Bill Haynes of CMI Gold & Silver reporting that the public was selling at retail last week and futures trader Dan Norcini expecting weakness in silver if it doesn't break through $50 quickly. The program can be found here: http://kingworldnews.com/kingworldnews/Broadcast/Entries/2011/4/30_KWN_W… CHRIS POWELL, Secretary/Treasurer 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: To contribute to GATA, please visit: http://www.gata.org/node/16
This posting includes an audio/video/photo media file: Download Now |
| Grant Williams: The ‘next big trade' may be precious metals again Posted: 01 May 2011 01:53 PM PDT GATA 6:47p ET Saturday, April 30, 2011 Dear Friend of GATA and Gold: Thanks to Zero Hedge for calling attention to today's edition of the "Things That Make You Go 'Hmmm'" letter by Grant Williams, who suspects that the "next big trade" may be the last big trade all over again — precious metals — and who cites Tocqueville Gold Fund manager John Hathaway's wonderful and prophetic essay from 1999 about the forthcoming collapse of the paper gold market, whose vast supplies of imaginary gold could never be delivered. You can find Williams' letter here: http://www.scribd.com/doc/54285652/Hmmm-Apr-30-2011 CHRIS POWELL, Secretary/Treasurer 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: To contribute to GATA, please visit: http://www.gata.org/node/16
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| Prosecutors investigate market manipulation through quote stuffing Posted: 01 May 2011 01:53 PM PDT GATA U.S. Prosecutors Probe High-Frequency, Algorithmic Trades By Joshua Gallu http://www.bloomberg.com/news/2011-04-29/high-frequency-trades-manipulat… U.S. prosecutors have joined regulators' investigation into whether some high-speed traders are manipulating markets by posting and immediately canceling waves of rapid-fire orders, two officials said. Justice Department investigators are "working closely" with the Securities and Exchange Commission to review practices "that are potentially manipulative, like quote-stuffing," Marc Berger, chief of the Securities and Commodities Task Force at the U.S. Attorney's Office for the Southern District of New York, said today at an event in New York. While regulators previously said they were probing possibly abusive algorithmic trading practices, the attention of criminal authorities ramps up the stakes. The SEC and Commodity Futures Trading Commission sharpened their focus on technology-driven trading after the so-called flash crash on May 6, which temporarily erased about $862 billion from the value of U.S. equities in less than 20 minutes. Regulators have placed limits on price moves and proposed rules limiting other practices, and lawmakers banned "spoofing," in which market participants try to trick other computers into making decisions that can be exploited for profit.
A joint SEC-CFTC report released in October found no evidence that the May 6 selloff was triggered by manipulation. The SEC last year established a market-abuse unit to investigate cases of manipulation. At the securities law conference in New York today, SEC Enforcement Director Robert Khuzami said investigators need better technology to adequately police markets and detect possible misconduct coming from high- speed and algorithmic trading. "The question is: Do we have enough transparency to detect wrongdoing if it was going on?" Khuzami said, adding that SEC investigators are probing other matters arising from the May 6 market crash. Berger said market manipulation was among six of his task force's priority areas, which include insider trading, Ponzi schemes, accounting fraud, asset forfeiture, and structured financial products. 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: To contribute to GATA, please visit: http://www.gata.org/node/16
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| Garry White: Obama's weak dollar, not ‘speculators,' to blame for oil spike Posted: 01 May 2011 01:48 PM PDT GATA By Garry White http://www.telegraph.co.uk/finance/oilprices/8482960/Obamas-lax-dollar-i… If President Obama is to be believed, "speculators" are responsible for the rise in oil prices that threatens the global recovery. However, for the real drivers of the oil price, the President needs to look closer to home. The US has continued to devalue its currency by allowing the Federal Reserve to print dollars like they are going out of fashion. This has boosted the price of all commodities — and the trend is likely to continue for the rest of this year. Commodities such as oil are priced in dollars. When the dollar falls, these commodities — be they copper, wheat, or oil — become cheaper in other currencies. This prompts "speculators" to buy. Prices of raw materials have therefore risen on a sea of dollar liquidity — fuelled by cheap money and quantitative easing. This is the reason that the gold price keeps hitting all-time highs, as US policy causes faith in "fiat money" to crumble. No country in the world has its currency backed by gold — and the plan to spend America out of the downturn is making a mockery of the country's "strong dollar" policy.
"Speculation makes up only a small portion of the market," according to Andrew Moorfield, Global Head of Oil & Gas at Lloyds Banking Group Corporate Markets. "The idea that this minority can influence prices to the extent that is sometimes believed seems unreasonable. It is also a position that enjoys very limited empirical support. The real influencers of the current oil price are not hedge fund managers, who arguably add valuable liquidity to these markets, but rather the fundamental drivers of supply, demand, and global instability." It is not a coincidence that the dollar index, which tracks the US currency against those of six major trading partners, has fallen as the oil price has risen over the past year — there is a remarkable correlation. Last week the index fell to its lowest level since 2008 after Ben Bernanke made it clear that US rates will not rise for some time. This fact will continue to support commodity prices as the dollar becomes even more unfashionable. Of course, there are fundamental drivers too. The oil price eased at the end of last week as it become clear that the US economy — the most oil-thirsty in the world — will be struggling for some time yet. This will limit demand and it should keep a lid on prices, if a dollar fall is ordered. On the other hand, US stockpiles of gasoline dropped for a 10th week in the week to April 22 — the longest losing streak in four years, according to data from the Department of Energy. Still, speculators will get the blame for rising prices — as it is politically expedient. This was the case when oil prices jumped as a result of the turmoil in Libya. However, the type of oil that Libya produces is an important consideration here. Oil from the North African country is "quality" oil. It is a low-sulphur product known as light sweet crude. This type of oil is an essential feedstock for European refineries to produce ultra low-sulphur diesel oil, which is used by European trucks and cars. So supply remains very important — especially for the US. Yet moves by the Obama administration following the Gulf of Mexico oil spill a year ago will crimp supply for years to come. His moratorium on US drilling, coupled with thousand of pages of new regulations for drilling companies, will make the supply side tighter. In the past two weeks the US President has asked the Department of Justice to investigate whether Wall Street speculators are manipulating the oil market. Maybe he thinks that it is. However, next time you fill up your tank and the price has increased, don't blame investment banking speculators for the rising prices — they are a tiny part of the problem. The blame lies with loose monetary policy in the US, plus high taxation by the UK Government, of course. 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: To contribute to GATA, please visit: http://www.gata.org/node/16
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| Hot Springs 5 Ounce Silver Uncirculated Coin Nears Sell Out Posted: 01 May 2011 01:47 PM PDT Opening demand was high for the Hot Springs 5 Ounce Silver Uncirculated Coin which went on sale Thursday, April 28, for $279.95. By evening, only a few thousand were left, indicating a sell out is likely fast approaching.
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| COT Silver Report – April 29, 2011 Posted: 01 May 2011 01:47 PM PDT
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| Posted: 01 May 2011 01:37 PM PDT
Two key factors that appear to be contributing to the rapid move in overnight silver (and subsequent jump to pare half its losses) is i) the fact that Bolivia, despite being in a cash crunch has for the time being yielded to miner demands and has put its nationalization plans (as discussed previously here) on hold, and ii) there has been a dramatic bout of selling coming out of nowhere, despite the PM complex having opened very well bid earlier on, in what appears a coordinate effort to nuke silver exclusively. From the WSJ: "Opposition from Bolivia's independently organized miners stopped President Evo Morales from implementing plans to boost state control over the country's mines Sunday, according to leading officials who were advocating takeovers of the country's vast mineral wealth. Mr. Morales has generally used May 1 labor day festivities to highlight his socialist agenda of reverting the country's energy and mineral resources to state ownership. On previous labor days, he announced nationalizations of Bolivia's strategic hydrocarbon reserves and the electric power grid, with mass rallies and military displays. This year, however, anticipated takeovers of the mining sector failed to materialize." None of this however, is news, as Coeur d'Alene and, of course, Sumitomo, the two biggest silver miners in the politically embroiled country already were assured their facilities would not be touched so we fail to see how this non-news is in any way validating of a nearly 20% move. Elsewhere, Bloomberg notes what appears to have been a massive coordinate attack on silver starting just before 6:30 pm Eastern. From Bloomberg:
Looks like the old sell into low volume trick to flush the stops and kill the weak hands has worked again. Throw in last week's two CME margin hikes and Friday night's margin bonanza by MF Global, and one had a perfect storm set up for another wipe out in silver to start the week. In the meantime, silver promptly managed to retrace over 50% of the move shortly after the dump. At this point whatever holders remain following last week's margin action and this evening's fine example of shock and awe will likely need far more energy and capital to be shaken out by the same entities whose primary goal is to prevent the surge in silver and ongoing capital-sapping collateral calls. Since none of the actual fundamentals before the long-term trajectory in silver (and gold) have changed, this appears like a rather attractive entry point. Lastly, one should recall that silver had a mini 10% correction last week and not only promptly recovered but nearly passed the $50 level shortly thereafter. This time will not be any different.
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| Gold Market Update - May 01, 2011 Posted: 01 May 2011 01:08 PM PDT The interesting thing about gold is that although it has been in a steady long-term uptrend there has still been no meltup, such as we have seen in silver, but if the dollar really caves in that could very well happen - and such a meltup may have just started this past Friday. The most important thing revealed by our long-term chart for gold, which goes back to the beginning of its bullmarket, is that its uptrend to date has been steady - there has been no parabolic blowoff move, and certainly no meltup - that is believed to lie ahead of us and it will mark the final climactic phase of this bullmarket that will lead to the latest fiat experiment being consigned to the trashcan of history. If it is just starting now we could see some real fireworks shortly, but as stated in the Silver Market update, you should be careful what you wish for, because such a meltup would be expected to synchronize with an all-out dollar collapse, which the Fed and Wall St banks have worked ...
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| Silver Market Update - May 01, 2011 Posted: 01 May 2011 01:06 PM PDT The big question on the minds of silver investors and especially silver traders is whether the meltup in silver has run its course, or whether it has further to go. On Monday last week we saw temporary burnout with a Reversal Day showing up on the chart at a point where silver was fantastically overbought. On the basis of this, and also the extremely bullish public opinion on silver and extremely bearish public opinion on the dollar (the public are normally wrong) it was reasonable to conclude that silver had either topped out or that a correction was imminent, and that is what we did conclude. However, the situation is now complicated by the fact that the latest COT figures reveal that Commercial short and Large Spec long positions have been dramatically scaled back just over the past week, which is not what you would expect to see ahead of a drop - what should happen is that Commercial short positions either ramp up or least remain constant. This latest COT chart by its...
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| Posted: 01 May 2011 12:45 PM PDT |
| A Sunday Vertical Drop of Gold, Silver, Platinum and Palladium Posted: 01 May 2011 12:43 PM PDT
By EconMatters 
EconMatters, May 1, 2011 | Facebook Page | Post Alert | Kindle
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| Market Turning Points Weekend Report Posted: 01 May 2011 12:40 PM PDT Last week, some indices appear to have reached a critical time frame. The dollar may have come to the end of its intermediate decline in what appears to be a selling climax characterized by the heaviest selling volume in five months. Read More...
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| Gold - Jumping the Track Or Reaching a Routine Target? Posted: 01 May 2011 11:50 AM PDT The "hot" money has made a boatload of cash in silver and there's likely still more to be made in this intermediate term run for the white metal. However, rotation of speculative money into Gold has likely begun and things could be just starting to heat up. As Sinclair has been saying, $1650 is in the bag for this run. However, could we also be looking at jumping the log scale trend line on this move like silver has done?
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