Gold World News Flash |
- Gold Seeker Closing Report: Gold Drops $30 While Dow Gains 400
- What To Do As Gold Reaches $1752.50
- goldprice.org will be offline at 12am CST
- Chris Powell: It's the dollar, not S&P
- Gold is Antidote for Treasury Trap
- GoldSeek Radio interviews GATA Chairman Bill Murphy
- 40 years after gold standard ended, bugs crow
- Dan Norcini: What to expect after short covering and margin hikes
- Ted Butler: The public be damned
- UNDER NO CIRCUMSTANCES Should you Sell Gold or be Short Gold
- Gold and Silver Price Relationship?
- Risk of Owning Gold Skewed to the Downside! Here?s Why
- What’s Due For “an Extraordinary Rally”
- Dan Norcini on CME Gold Margin Increase
- Gold to rally through 2012, S&P says
- Desperate Swiss eye euro peg to repel safe-haven flood
- Understanding Silver’s Recent Price Action
- Double Depression
- Norcini - What to Expect After Short Covering & Margin Hikes
- Back To Square Minus 1: Regulators Fail To Agree On Short-Selling Ban
- Understanding Silver’s Recent Price Action
- Gold Warning, Cyclical 34 Month Bull Run is About to End
- Conscience of a Gold Investor
- Gold Daily and Silver Weekly Charts - Bear Raid With Comex Margin Increases, Right on Cue
- Crony Capitalism at Work
- Food commodities prices surge
- Long Lost Lovers
- Margin Hikes help derail gold; HIgher Equities also hurt
- Gold Support Expected at 1720
- Silver and gold update – The fiat dollar
| Gold Seeker Closing Report: Gold Drops $30 While Dow Gains 400 Posted: 11 Aug 2011 04:00 PM PDT Gold climbed to a new record high of $1814.84 in afterhours access trade yesterday afternoon and traded roughly $10 higher in Asia and London, but it then fell throughout most of trade in New York and ended with a loss of 1.81%. Silver fell to as low as $37.822 before it bounced back higher in the last couple of hours of trade, but it still ended with a loss of 2.01%.
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| What To Do As Gold Reaches $1752.50 Posted: 11 Aug 2011 03:29 PM PDT Dear CIGAs, Now that we have reached $1752.20 gold, what should you do? Stay firm in your disciplines. During this entire market chasing strength in gold has proven dangerous more often than not. Angels should be looked at for the mad trader as areas to lighten, not double up. You can win this game Continue reading What To Do As Gold Reaches $1752.50
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| goldprice.org will be offline at 12am CST Posted: 11 Aug 2011 02:58 PM PDT goldprice.org and silverprice.org will be offline at 12 am CST for up to 1 hour for important hardware upgrades. Thankyou for your understanding. 
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| Chris Powell: It's the dollar, not S&P Posted: 11 Aug 2011 01:27 PM PDT By Chris Powell http://www.journalinquirer.com/articles/2011/08/11/chris_powell/doc4e43e... Standard & Poor's is catching hell for cutting the credit rating of the U.S. government and threatening to cut the credit rating of other governments. People are blaming the agency for the stock market declines that have followed all over the world. With Italy's penchant for comic opera, prosecutors in Milan have even raided S&P's office there in pursuit of evidence for a "charge" of unfairly criticizing the country's financial system. Yes, S&P long awarded spotless credit ratings to what were essentially frauds, so the agency's credibility is less "standard" than "poor." But the company's mistakes are no rationale for continuing them. And yes, having the ability to pay its bills in currency it prints by itself, the U.S. government is unlike ordinary businesses and need never default on its debts, at least in a technical sense. But in a practical sense, the government long has been defaulting on its debts, as the value of the dollar, the currency in which those bonds are repaid, has fallen 30 percent in the last 20 years, and about 14 percent in the last year alone, as measured against other major currencies. Going back to the creation of the Federal Reserve in 1913, the dollar's value has diminished by more than 90 percent. The other day the Fed promised to keep interest rates at virtually zero for another two years, which is to say that interest rates will remain negative, below the inflation rate, the rate of the dollar's debasement. So practical default on the U.S. government's debt seems likely to continue. ... Dispatch continues below ... ADVERTISEMENT Prophecy Platinum Reports 10.97 Million Ounces Inferred An independent resource report on the Wellgreen project in the Yukon Territory in Canada has just confirmed that it as one of the largest platinum group metals projects in Canada and one of the few outside South Africa, Prophecy Platinum Corp. Chairman John Lee says. The report, compliant with Canadian National Instrument 43-101, was written by geologist Todd McCracken of Wardrop Engineering Inc., a Tetra Tech company. It incorporated drill data from 701 diamond drill holes (182 surface and 519 underground) totaling more than 53,222 metres. Using a 0.4 percent nickel equivalent cutoff grade, the Wellgreen deposit now contains a total inferred resource of 289.2 million tonnes at an average grade of 0.53 g/t platinum, 0.42 g/t palladium, 0.23 g/t gold (1.18 g/t PGM and gold), 0.38 percent nickel, and 0.35 percent copper. Separately, the deposit also contains an indicated resource of 14.3 million tonnes at an average grade of 0.99 g/t platinum, 0.74 g/t palladium, 0.52 g/t gold (2.25 g/t PGM and gold), 0.69 percent nickel, and 0.69 percent copper. Prophecy Platinum Corp. trades on the Toronto Venture Exchange under the symbol NKL, on the pink sheets in the United States as PNIKD, and in Frankfurt as P94P. For the complete press release on the Wellgreen report, please visit: http://prophecyplat.com/news_2011_july14_prophecy_platinum_new_resource_... Further, these days there is no genuine market for U.S. government bonds, as most are being purchased by the Fed and by foreign central banks as a matter of trying to hold the world financial system together. Without such purchases, particularly by China and Japan, there's no telling what U.S. government bonds would be worth, if anything. And since there really is no repayment of U.S. government bonds anyway, old bonds being retired only through issuance of new bonds with the government's net debt always increasing, the solvency of the government became irrelevant to its debt long ago. What's relevant here is only the value of the dollar. No one in authority -- not the president, the treasury secretary, or the chairman of the Fed -- will speak candidly on the point, but the record is plain enough. Devaluation of the dollar is and always has been government policy; indeed, the capacity for strategic devaluation, what is called a "flexible currency," has always been the very point of central banking. Some people think this is good, as it provides a "lender of last resort" to stave off financial disasters. Some people think it is bad, since it hasn't always worked well and lately has hardly worked at all; since it has been perverted into a system of infinite patronage for the crooked financial elite; and since it has deprived the world of any stable measure of value, and thus has expropriated savers, sometimes overnight. But the value of the currency and, more so, the location of the power to determine that value are what the argument should be about, not whether a ratings agency exceeded its competence. Join GATA here: Toronto Resource Investment Conference http://cambridgehouse.com/conference-details/toronto-resource-investment... The Silver Summit http://cambridgehouse.com/conference-details/the-silver-summit-2011/48 New Orleans Investment Conference http://www.neworleansconference.com/ Support GATA by purchasing gold and silver commemorative coins: https://www.amsterdamgold.eu/gata/index.asp?BiD=12 Or by purchasing a colorful GATA T-shirt: 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: 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: ADVERTISEMENT Golden Phoenix Q2 2011 Conference Call Posted at Company Internet Site The second quarter 2011 conference call of Golden Phoenix Minerals Inc. (GPXM) has been posted at the company Internet site for immediate playback. The call includes updates on the start of gold production at the company's Mineral Ridge gold project in Nevada, the letter of intent to acquire the Santa Rosa gold mine in Panama, and the company's due-diligence efforts to secure a senior stock exchange listing. The conference call is 18 minutes long and you download an mp3 of it here: http://www.goldenphoenix.us/audio/GPXMCC071211.mp3 Or play back the call here: http://goldenphoenix.us/conferencecalls/ Golden Phoenix is a U.S. mining company with international exposure to gold, silver, and strategic metals. The company's business model combines project generation and royalty mining that offers the potential for exploration upside, coupled with the backing of production and future royalty streams. View company videos here:
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| Gold is Antidote for Treasury Trap Posted: 11 Aug 2011 01:22 PM PDT By: John Browne Wednesday, August 10, 2011 Last week Fed Chairman Bernanke raised eyebrows and denied history when he asserted in front of Congress that gold doesn't qualify as money. Yesterday he took the unprecedented step of announcing that the Federal Reserve would keep interest rates near zero for at least the next two years. In very short order thereafter it required much more of the money that he believes in (U.S. dollars) to buy the money that he doesn't believe in (gold). In any event, it was beyond unusual for the Fed to make such an explicit time commitment on monetary policy. To underscore this fact, three voting members of the Federal Open Market Committee came out against the policy. Such dissent within the Fed's ranks has not been seen in decades. But Bernanke's shameless appeasement of market fears did interrupt, if only for a few hours, the free fall on Wa...
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| GoldSeek Radio interviews GATA Chairman Bill Murphy Posted: 11 Aug 2011 01:20 PM PDT 9:21p ET Thursday, August 11, 2011 Dear Friend of GATA and Gold: GoldSeek Radio's Chris Waltzek today interviewed GATA Chairman Bill Murphy for a few minutes and you can listen to it here: http://radio.goldseek.com/nuggets/murphy08.10.11.mp3 CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Golden Phoenix Q2 2011 Conference Call Posted at Company Internet Site The second quarter 2011 conference call of Golden Phoenix Minerals Inc. (GPXM) has been posted at the company Internet site for immediate playback. The call includes updates on the start of gold production at the company's Mineral Ridge gold project in Nevada, the letter of intent to acquire the Santa Rosa gold mine in Panama, and the company's due-diligence efforts to secure a senior stock exchange listing. The conference call is 18 minutes long and you download an mp3 of it here: http://www.goldenphoenix.us/audio/GPXMCC071211.mp3 Or play back the call here: http://goldenphoenix.us/conferencecalls/ Golden Phoenix is a U.S. mining company with international exposure to gold, silver, and strategic metals. The company's business model combines project generation and royalty mining that offers the potential for exploration upside, coupled with the backing of production and future royalty streams. View company videos here: Join GATA here: Toronto Resource Investment Conference http://cambridgehouse.com/conference-details/toronto-resource-investment... The Silver Summit http://cambridgehouse.com/conference-details/the-silver-summit-2011/48 New Orleans Investment Conference http://www.neworleansconference.com/ Support GATA by purchasing gold and silver commemorative coins: https://www.amsterdamgold.eu/gata/index.asp?BiD=12 Or by purchasing a colorful GATA T-shirt: 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: 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: ADVERTISEMENT Prophecy Platinum Reports 10.97 Million Ounces Inferred An independent resource report on the Wellgreen project in the Yukon Territory in Canada has just confirmed that it as one of the largest platinum group metals projects in Canada and one of the few outside South Africa, Prophecy Platinum Corp. Chairman John Lee says. The report, compliant with Canadian National Instrument 43-101, was written by geologist Todd McCracken of Wardrop Engineering Inc., a Tetra Tech company. It incorporated drill data from 701 diamond drill holes (182 surface and 519 underground) totaling more than 53,222 metres. Using a 0.4 percent nickel equivalent cutoff grade, the Wellgreen deposit now contains a total inferred resource of 289.2 million tonnes at an average grade of 0.53 g/t platinum, 0.42 g/t palladium, 0.23 g/t gold (1.18 g/t PGM and gold), 0.38 percent nickel, and 0.35 percent copper. Separately, the deposit also contains an indicated resource of 14.3 million tonnes at an average grade of 0.99 g/t platinum, 0.74 g/t palladium, 0.52 g/t gold (2.25 g/t PGM and gold), 0.69 percent nickel, and 0.69 percent copper. Prophecy Platinum Corp. trades on the Toronto Venture Exchange under the symbol NKL, on the pink sheets in the United States as PNIKD, and in Frankfurt as P94P. For the complete press release on the Wellgreen report, please visit: http://prophecyplat.com/news_2011_july14_prophecy_platinum_new_resource_...
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| 40 years after gold standard ended, bugs crow Posted: 11 Aug 2011 01:17 PM PDT By Jan Harvey http://www.reuters.com/article/2011/08/11/us-gold-bugs-idUSTRE77A3CT2011... LONDON -- Gold, and only gold, will be our salvation when the value of companies, banks, countries and even money itself melts away. Gold, not shifting currencies, is the foundation of wealth and security. Gold is back, for good. This is the song of the "gold bugs" -- the fervent fans of the precious metal who have clung to its investment value for three generations and now glow in the reflected luster of a record price approaching $2,000 for just one ounce. Monday will mark the 40th anniversary of the United States' abandonment of the gold standard. But gold bugs kept the faith -- even when prices stayed under $500 for nearly 25 years after their 1981 peak. ... Dispatch continues below ... ADVERTISEMENT Lewis E. Lehrman on How to Solve the U.S. Debt Problem Lewis E. Lehrman, chairman of the Lehrman Institute, sponsor of The Gold Standard Now project, advises that to reduce the $1 1/2 trillion U.S. deficit, the Republican Party must initiate an investment program. Working Americans are not saving, which enables the banks to lead the country into a cycle of debt, leverage, boom, panic, and bust. Lehrman says: Eliminating the budget deficit of a trillion and a half dollars cannot be done overnight. The proposal by U.S. Rep. Paul Ryan was very dramatic -- one Republican called it radical -- but it was not happily received. The solution, of course, is to design an American program for prosperity, because you can solve these entitlement problems with a growing economy. We need a tremendous program of investment, and investment comes from savings. When you pay savers, middle-income professionals, and working people 0 percent at the bank, you are not going to encourage them to save. Then we are left with a bank cycle of debt, leverage, boom, panic, and bust." To read more and to sign up for The Gold Standard Now's free, noncommercial, weekly report, "Prosperity through Gold," please visit: http://www.thegoldstandardnow.org/gata Their passion derided, dismissed as hopelessly out dated doomsayers, their love for the metal seemed irrational. The gold bug label itself goes back to master of the supernatural Edgar Allen Poe and his story of that name, a tale of golden beetle whose bite sends the hero to a chest of gold and jewels. It reappeared as one of the first campaign buttons -- a brass bug sported by supporters of William McKinley in the bitter U.S. presidential election of 1896. McKinley, the first presidential candidate to barnstorm across the nation, backed the gold standard against his Democratic opponent's proposal that it should be joined by silver in a fixed ratio. Loser William Bryan slipped into history but bimetallism lived on for a little in the think tanks of the day. Fast forward and the financial crisis of 2008 has made gold the darling of investors from hedge funds to taxi drivers, and sparked a near-doubling of prices. "Gold has been rising against all national currencies, and that's significant," James Turk, founder of bullion dealer Goldmoney, said. "When there are problems with a national currency ... people begin to worry about the value of their money, whether they're going to lose purchasing power because of inflation or other problems. As a consequence, they look for safe havens." He was speaking as a true gold bug -- not in the dark days after Lehman Brothers' demise in 2008, nor in the depths of last year's euro zone debt crisis, nor after Standard & Poor's recent downgrade of the United States' top-notch credit rating. Turk's view came in a BusinessWeek interview he gave in 2005, well in advance of the current financial crisis. "My long-standing forecast, made in a Barron's interview in October 2003, is that $8,000 per ounce will be reached sometime between 2013-2015," he told Reuters this week. "I've stayed with that forecast over the years and see no reason to change it." The world's current financial woes are only going to get worse if current policies continue, he believes, meaning the rally in gold prices is unlikely to stop here. "Politicians and central bankers are making decisions that debase national currencies, and the resulting bad monetary policies they are following are causing the gold price to rise," he said. Gold's latest push to record highs has gone hand-in-hand with a plunge in Wall Street stocks to their lowest in nearly a year, while the dollar is languishing near multi-year lows. Long-term gold bull David Beahm, vice president of marketing and economic research at New Orleans bullion dealer Blanchard and Co., says worries over the stability of the stock markets will be a key driver of higher gold prices. "The best investment right now is gold," he said. "By diversifying one's portfolio with a negatively-correlated gold, investors can protect themselves from deep plunges in the equity market." "There is no news in the market today or over the coming few months that is likely to stop the current gold bull market, as the fundamentals are firmly in place for gold to continue its rise," he says. Traditional investment commentators have dismissed gold -- which, with no "intrinsic" value of its own, is only really as valuable as a buyer thinks it is -- as a classic bubble. But those who have predicted its crash since it rose above $700 an ounce in 2006, on a simple "what goes up, must come down" analysis, have consistently been proved short-sighted. Gold prices traded in a relatively narrow range from $250-420 an ounce for the whole of the 1990s. They have since more than quadrupled from that high, peaking at a record just below $1,800 an ounce earlier this week. Their rise accelerated sharply from 2005 onwards, breaking through $1,000 an ounce in 2008 as the weaker dollar fueled demand for alternative stores of value. Now gold bulls are predicting that prices, now around $1,750 an ounce, but still short of an inflation-adjusted high of nearly $2,500 in 1980, could climb even higher. "I believe the price of gold will rise irregularly over the next several years, possibly reaching $1,850 an ounce by the end of this year, breaking above $2,000 in 2012, and possibly $3,000, $4,000, and even $5,000 in years to come," says Jeffrey Nichols, managing director of American Precious Metals Advisors and senior economic advisor to Rosland Capital. "At the heart of this forecast is my observation (or belief) that the United States and, to a lesser but still significant extent, Europe have been living beyond our means for decades." Back in 1896, losing presidential candidate Bryan's Cross of Gold speech turned the watching crowd into "a wild, raging irresistible mob," the New York Times reported. Gold bugs, often accused of sensationalism, are finding their passion is becoming mainstream. "Raging" is probably no longer a suitable description of them. "Irresistible" is increasingly nearer the mark. Join GATA here: Toronto Resource Investment Conference http://cambridgehouse.com/conference-details/toronto-resource-investment... The Silver Summit http://cambridgehouse.com/conference-details/the-silver-summit-2011/48 New Orleans Investment Conference http://www.neworleansconference.com/ Support GATA by purchasing gold and silver commemorative coins: https://www.amsterdamgold.eu/gata/index.asp?BiD=12 Or by purchasing a colorful GATA T-shirt: 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: 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: ADVERTISEMENT Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit, 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
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| Dan Norcini: What to expect after short covering and margin hikes Posted: 11 Aug 2011 01:03 PM PDT 9:01p ET Thursday, August 11, 2011 Dear Friend of GATA and Gold (and Silver): Futures market analyst Dan Norcini tonight tells King World News that there's nothing suspicious about this week's futures trading margin increase in gold, even as recent margin increases in silver were very suspicious. An excerpt from Norcini's interview is headlined "What to Expect After Short Covering and Margin Hikes" and you can find it at King World News here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/8/11_No... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit, 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: Toronto Resource Investment Conference http://cambridgehouse.com/conference-details/toronto-resource-investment... The Silver Summit http://cambridgehouse.com/conference-details/the-silver-summit-2011/48 New Orleans Investment Conference http://www.neworleansconference.com/ Support GATA by purchasing gold and silver commemorative coins: https://www.amsterdamgold.eu/gata/index.asp?BiD=12 Or by purchasing a colorful GATA T-shirt: 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: 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: ADVERTISEMENT Lewis E. Lehrman on How to Solve the U.S. Debt Problem Lewis E. Lehrman, chairman of the Lehrman Institute, sponsor of The Gold Standard Now project, advises that to reduce the $1 1/2 trillion U.S. deficit, the Republican Party must initiate an investment program. Working Americans are not saving, which enables the banks to lead the country into a cycle of debt, leverage, boom, panic, and bust. To read more and to sign up for The Gold Standard Now's free, noncommercial, weekly report, "Prosperity through Gold," please visit: http://www.thegoldstandardnow.org/gata
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| Ted Butler: The public be damned Posted: 11 Aug 2011 12:55 PM PDT 9p ET Thursday, August 11, 2011 Dear Friend of GATA and Gold (and Silver): In commentary posted tonight at GoldSeek, silver market analyst Ted Butler seems to have realized that the U.S. Commodity Futures Trading Commission isn't likely to interfere with the investment banks and speculators that have taken over the silver futures market, but he asks for help with just one more petition drive. Butler's commentary is headlined "The Public Be Damned" and you can find it at GoldSeek's companion site, SilverSeek, here: http://news.silverseek.com/SilverSeek/1313079231.php And at 24hGold here: http://www.24hgold.com/english/news-gold-silver-the-public-be-damned.asp... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Prophecy Platinum Reports 10.97 Million Ounces Inferred An independent resource report on the Wellgreen project in the Yukon Territory in Canada has just confirmed that it as one of the largest platinum group metals projects in Canada and one of the few outside South Africa, Prophecy Platinum Corp. Chairman John Lee says. The report, compliant with Canadian National Instrument 43-101, was written by geologist Todd McCracken of Wardrop Engineering Inc., a Tetra Tech company. It incorporated drill data from 701 diamond drill holes (182 surface and 519 underground) totaling more than 53,222 metres. Using a 0.4 percent nickel equivalent cutoff grade, the Wellgreen deposit now contains a total inferred resource of 289.2 million tonnes at an average grade of 0.53 g/t platinum, 0.42 g/t palladium, 0.23 g/t gold (1.18 g/t PGM and gold), 0.38 percent nickel, and 0.35 percent copper. Separately, the deposit also contains an indicated resource of 14.3 million tonnes at an average grade of 0.99 g/t platinum, 0.74 g/t palladium, 0.52 g/t gold (2.25 g/t PGM and gold), 0.69 percent nickel, and 0.69 percent copper. Prophecy Platinum Corp. trades on the Toronto Venture Exchange under the symbol NKL, on the pink sheets in the United States as PNIKD, and in Frankfurt as P94P. For the complete press release on the Wellgreen report, please visit: http://prophecyplat.com/news_2011_july14_prophecy_platinum_new_resource_... Join GATA here: Toronto Resource Investment Conference http://cambridgehouse.com/conference-details/toronto-resource-investment... The Silver Summit http://cambridgehouse.com/conference-details/the-silver-summit-2011/48 New Orleans Investment Conference http://www.neworleansconference.com/ Support GATA by purchasing gold and silver commemorative coins: https://www.amsterdamgold.eu/gata/index.asp?BiD=12 Or by purchasing a colorful GATA T-shirt: 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: 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: ADVERTISEMENT Golden Phoenix Q2 2011 Conference Call Posted at Company Internet Site The second quarter 2011 conference call of Golden Phoenix Minerals Inc. (GPXM) has been posted at the company Internet site for immediate playback. The call includes updates on the start of gold production at the company's Mineral Ridge gold project in Nevada, the letter of intent to acquire the Santa Rosa gold mine in Panama, and the company's due-diligence efforts to secure a senior stock exchange listing. The conference call is 18 minutes long and you download an mp3 of it here: http://www.goldenphoenix.us/audio/GPXMCC071211.mp3 Or play back the call here: http://goldenphoenix.us/conferencecalls/ Golden Phoenix is a U.S. mining company with international exposure to gold, silver, and strategic metals. The company's business model combines project generation and royalty mining that offers the potential for exploration upside, coupled with the backing of production and future royalty streams. View company videos here:
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| UNDER NO CIRCUMSTANCES Should you Sell Gold or be Short Gold Posted: 11 Aug 2011 12:24 PM PDT Gold Price Close Today : 1748.80 Change : (32.50) or -1.8% Silver Price Close Today : 38.656 Change : (0.669) or -1.7% Gold Silver Ratio Today : 45.24 Change : -0.057 or -0.1% Silver Gold Ratio Today : 0.02210 Change : 0.000028 or 0.1% Platinum Price Close Today : 1787.60 Change : 20.80 or 1.2% Palladium Price Close Today : 741.45 Change : 15.50 or 2.1% S&P 500 : 1,172.64 Change : 51.88 or 4.6% Dow In GOLD$ : $131.72 Change : $ 7.33 or 5.9% Dow in GOLD oz : 6.372 Change : 0.355 or 5.9% Dow in SILVER oz : 288.27 Change : 15.67 or 5.7% Dow Industrial : 11,143.31 Change : 423.37 or 3.9% US Dollar Index : 74.61 Change : -0.002 or 0.0% Picture this: markets plunging and rising 4 to 5% a day. Friends, take it from me, the people who make the market simply cannot trade under those circumstances. That turmoil eats you alive. More evidence a panic is on: I heard today that Swiss 20 francs in Europe are bringing E20 (US$28) over melt per coin and Rooster French 20 francs are bringing E25 (US$35). That's 8.5% and 10.7% respectively. Report says the French are pulling money out of banks on suspicion that after Greece, Portugal, Ireland, Spain, and Italy comes France, and soon. Those are huge premiums considering at wholesale in the US they've been about US$5. STOCKS today found a friend. My o my. Dow rose 423.37 points (3.95%) to 11,143.31 and S&P500 followed with a 4.63% (51.88 point) rise to 1,172.64 Put that into perspective: Dow in Gold Dollars remains at G$131.72 (7.33 oz). No hope for stocks against silver or gold. Stocks -- the empty bucket at a raging fire. US DOLLAR INDEX flatlined today, closed 74.614, down 2.2 basis points. Euro rose 0.46% to 1.4238, meaningless on the chart. Nipponese NGM not yet successful in bringing down the Yen. Their tricks are like using plastic bullets Godzilla. The GOLD PRICE passed an inscrutable day. High at $1,794.90, low at $1,732. Appeared to break today around $1,760, dropped to $1,750, then briefly to $1,740 and climbed straight back up. Shook the whole incident off and now is trading at $1,764.10. Comex lost $32.50 to close at $1,748.80, but increasingly the real world and Comex have little in common. After Comex closed GOLD climbed over $1,760. Is Comex really relevant, or just useful to those who paint the tape? Yes, today MIGHT have been the break in gold at a top, but then again, maybe not -- certainly not if driven by panic in Europe. Key will be tomorrow's close, which must not be lower than today's. UNDER NO CIRCUMSTANCES should you sell gold or be short gold. The SILVER PRICE lost 66.9c at the Comex close of 3865.6c. Range was 3939c to 3868c. Wide swings are killing me -- silver will be okay and not crash if it can remain above 3700c. Bounced off its 20 DMA today, coming up from beneath. Indicators calling for lower silver. Now if I were a CLEVER Nice Government Man (no, not a complete oxymoron, since they can print enough money to hire real talent) instead of spending so much trying to crash gold, I would just suppress silver to pull the heart out of gold investors. Hang on to your silver. Nothing is clear here, and it is for times that lack clarity that we own silver and gold. This much is clear: central banks have not stopped inflating, and must now speed up inflating, so our silver and gold will keep on climbing relentlessly. On 11 August 1860 the first successful silver mill in American began operating, in Virginia City, Nevada. The Comstock Lode there was discovered in 1859, and as memory serves me it produced over a billion oz. of silver. What most people don't know is that the value of gold produced over the whole life of the mines was about equal to the value of the silver from the Comstock. Adjusted for inflation, production at peak in 1877 alone was about $270 million in gold and $400 million in silver. It wasn't new silver supply that drove the price of silver down after 1873, it was politics and the Crime of '73, demonetizing silver. 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. Be advised and warned: Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures. 
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| Gold and Silver Price Relationship? Posted: 11 Aug 2011 10:43 AM PDT The following table sets out the closing Gold and Silver prices beginning last Wednesday - which I now refer to as 'Grey Thursday' - through to last night at 10:00 p.m. ET. Read More...
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| Risk of Owning Gold Skewed to the Downside! Here?s Why Posted: 11 Aug 2011 10:10 AM PDT The peak nominal price of gold ($850/ozt.) occurred on January 21, 1980,*which would correspond to about $2,450 in today’s dollars according to my calculations using the CPI. If history repeats itself [exactly, then]*gold*will gain another 35% or so, briefly, before becoming one of the worst investments in the world for the next decade or two. [Let me explain.] Words: 558 So says Scott Grannis, the Calafia Beach Pundit ([url]www.scottgrannis.blogspot.com[/url]) in edited excerpts from*an article* which Lorimer Wilson, editor of www.munKNEE.com (It's all about Money!), has further edited ([* ]), abridged (…) and*reformatted*below**for the sake of clarity and brevity to ensure a fast and easy read. Please note that this paragraph must be included in any article re-posting to avoid copyright infringement.*Grannis*goes*on to say: Gold is riding the crest of a perfect storm these days. Geopolitical turmoil is all around us, with even the staid streets of the U.K. beset by mindless v...
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| What’s Due For “an Extraordinary Rally” Posted: 11 Aug 2011 09:59 AM PDT Addison Wiggin – August 11, 2011
The minimum amount traders must keep on deposit was $6,075 per contract yesterday. Today it's $7,425. A $100+ spike in gold in less than 72 hours made the increase nearly inevitable. Fear of a bubble in gold is on the rise.
You don't have to look far for the reasons. "Everything the gold bulls predicted is coming true," Mitsubishi precious metals strategist Matthew Turner tells the Financial Times. "The eurozone is under severe stress, government debt from Greece to the U.S. is being called into question and most central banks see the solution as expanding the money supply." "The race to debase currencies is on," James Dailey of TEAM Financial Management tells Bloomberg. "Gold will continue to appreciate until there is a fundamental shift in government policies." "Physical gold is the ultimate collateral because it has no credit risk," adds a report from Merrill Lynch. Um… unlike Merrill's parent company… but that's another story we'll get to later.
 "It is one of the safest investments in times of crisis — and perhaps the prettiest!" the paper explains inside. It cites a recent headline in the considerably more staid business daily Handelsblatt to make its case: "Gold is going to be the reserve currency." That must be music to the ears of Lew Lehrman and Ron Paul. Bild is giving away ten 20-gram bars every hour — just under ¾ of an ounce each — between 8 a.m. and 6 p.m. today to readers who call in and answer the following stumper about the Midas metal:
Woe to the Bild reader who gets it wrong…
Gartman points to Tuesday's Fed statement, locking in near-zero interest rates for "at least" two more years. "This is perhaps the most important statement by a central bank of this consequence in our memory," our Vancouver alum writes "save of course for when Chairman [Paul] Volcker changed the entire method of the Fed's operation during the days of the Carter administration. "In a world where gold has become a currency, and the search is on for a reservable currency that shall rank second behind the dollar, with the dollar ranking first simply because it is the most liquid and because of the U.S.' consistent military strength, gold wins."
"This is not an opportunity to take profits, because I think there is more to come. Don't be misled by the jump in Treasuries and the sideways action of the U.S. dollar."
But over the weekend came the S&P downgrade. And the scramble in Europe to support Spanish and Italian government bonds, rather, to support the banks that were foolish enough to buy them. On Monday, gold stocks reversed faster than Lindsay Lohan . Check out a chart of the GDX gold stock ETF… and the S&P 500.  "Gold mining stocks are long overdue for an extraordinary rally," writes Strategic Short Report's Dan Amoss. "Their cash flows are going to be spectacular in an environment of $1,700-plus gold prices."
"So if gold at $1,700 sticks, gold miners are going to make a lot of money. And all the problems that led to $1,700 gold aren't going away anytime soon. Gold ought to move higher. "Given the problems with the rest of the economy and the market, this is a good opportunity in select gold stocks." We've been anticipating this run-up in gold and precious metals for years…. Our editors are poised, ready and champing at the bit ready to seize the opportunity. With that in mind, we're assembling their best gold plays… Dan's looking at it through the macroeconomic prism… Chris with his eye for deep value… Byron King, with his ability to talk shop with geologists in the field… Alan Knuckman with his experience in the trading pits. We're also convening an "emergency summit" teleconference with our editors next week to address the collapse in the stock market and the breakout we're expecting in metals… to make sure you're positioned right for big market moves… in either direction. We're offering access to both the metals report and the teleconference as a package deal. The only way you'll have access is by exclusive invitation… and the only way to assure you'll receive the invitation is by signing up here. We'll be sending it out next week. We can accept only 300 people… so it's best to make sure you get on the list right away. And please let us know if you're a Reserve member.
"As confusion continues," says our resource trader Alan Knuckman, "alternative assets to the stock market and the dollar are more attractive… money has to go somewhere. This has renewed the energy in the silver market." Last year, "silver had an obvious high probability to take out the 2008 $21 highs," Alan suggests, "when gold was leading the bullish march and making new all-time highs." It did exactly that, and Alan's Resource Trader Alert readers took silver gains of 84%… 100%… and 206%. Right now, silver remains 20% below the $50 level necessary to eclipse the 1980 record highs. "The rubber band has been stretched again," says Alan with a gleam in his eye, "and a snap to new height is much more likely than not." If you want to juice your metal gains… without taking unnecessary risks like buying on margin… you owe it to yourself to check out Alan's strategy, right here.
The number, by the way, was 395,000. We recall two weeks ago we got a sub-400,000 number only to see it revised upward the following week. Think we'll withhold the applause for now.
"The fundamentals are so much better in our country and in our company and in our industry than they were four years ago, when the financial crisis hit," said BoA CEO Brian Moynihan during a conference call yesterday. Naturally, he believes the wave of litigation hitting his firm over Countrywide's mortgage practices won't force him to go raise new capital, no sirree. "BAC is a too-big-to-fail zombie created by the Obama administration and the Fed to protect U.S. financial markets," says Institutional Risk Analytics' Chris Whalen, delivering a splash of cold water, "but is now so vast and unstable that it threatens the global economy… "Millions of payroll deductions, property tax payments and remittances flow through BAC daily. But losses from acquisitions such as Countrywide, Merrill Lynch as well as hundreds of other operating entities threaten to bring the bank down." We still don't know if Bank of America will prove the catalyst for the crisis we've been forecasting… but it seems like a fine candidate.
Kyle DeWitt was ticketed and fined last spring for fishing smallmouth bass out of season. He disputes the charge, but he doesn't have the money to hire a lawyer. In fact, having lost his job last year and trying to support his fiancee and 9-month-old son, he didn't even have the money to pay the fine and make it all go away. He offered to pay $100 upfront and the rest later… but the judge refused and sentenced him to three days in jail. We're guessing the cost of Mr. DeWitt's incarceration exceeded that of the fine. But that's the way it goes now, when you can be nicked $275 so a fire inspector can look at the solar panels on your home… or fined $200 for allowing a single recyclable can in your trash… or fined $600 for allowing rainwater from your parking lot to wash into the storm sewers. We'll just add Mr. DeWitt's case to the list. If the tax, fee and fine police haven't shown up on your doorstep, and you somehow think you're exempt… you'll think differently after you see this.
"Thanks for the downgrade," the banner reads, "you should all be fired." So far, so good. "I thought that is something I could do that wouldn't cost a million dollars and maybe someone would listen to me," Lucy Nobbe, a broker and single mom from Kirkwood, Mo. said, justifying her plan. The plane and sign cost her $900. The company she hired was so impressed with the idea, they gave her a discount. The plan seemed to be going just fine. Until… Oops, following Sept. 11, a "no-fly zone" was imposed over the Capitol. Plan B. Mrs. Nobbe hires a plane to fly the same sign around Lower Manhattan.  Thus did the blogosphere erupt yesterday with the idea that sign was directed at Standard & Poor's… not the "professional politicians" whose actions made the downgrade inevitable. Oy. "I originally wanted to fly it over Washington, D.C., but learned that you can't do that. So I chose Wall Street instead. I didn't specifically intend it to fly over S&P. I'm just a mother from St. Louis who feels the only reason we got downgraded was people in politics." Nice try, Lucy. We hear you, though.
"I seem to remember there was another famous leader many, many years ago that asked for the same sort of powers, which were granted. I think his name was Adolf. Be very, very careful to travel down that road, there be dragons." "And for those that don't remember their history so well, that was basically the plot in Star Wars: Episode I — the Phantom Menace. Create an enemy, create a panic, ask for temporary powers, assume total power, destroy the republic, create an empire, become emperor, take over the universe and become really, really evil." "All for the good of the people." The 5: Ratigan rants about a bought Congress. But what "authority" in Washington could clean up the mess who isn't bought… a megalomaniac… or both?
The 5: Perhaps, but ultimately, politics — politicians and their fatuous promises — is not the answer at all.
"The real physical is being bought by the people who know it's money. When the scheme is outed, the banks will be in real trouble and silver will fly." The 5: There's not much outing to do… unless they get their ass handed to them in a short squeeze.
The 5: Again we turn to our friend to James Turk: "Silver has been caught in some crosscurrents," he explains. "On the one hand, we are seeing a repeat of the pattern where silver falls when a financial crisis heats up. On the other hand, gold should be a magnet pulling silver higher." As evidence of the latter, he points to silver moving up on Monday while oil got crushed. "Don't get discouraged," Turk recommends. "Silver is building a base for a breakout above $42. Once that occurs, it will in all likelihood shoot straight to $50."
"Now, the bank offered us an even lower interest rate and agreed to cover all the refi costs. Is this a trick question? We accepted and now save a couple hundred in monthly payments."
"Long may you continue to publish!" The 5: Cheers, back atcha. Addison Wiggin P.S.Gold is pulling back a little bit more now — $1,745 as we write. Remarkably, shares of the gold ETF, GDX, are up more than 1% today: That means gold stocks are rising with gold on days that gold is up, and rising with stocks on the day stocks are up. Those are the ingredients for one powerful bull run. Once again, we're assembling our editors' very best gold plays… and at the same time we're planning an "emergency summit" teleconference to take advantage of all the opportunities taking shape right now as stocks swoon and precious metals power ahead. Keep an eye out for an exclusive invitation next week. It'll offer you access to a report detailing our editors' best gold plays… and access to our editors' emergency summit. You'll receive this eyes-only invitation… provided you sign up here. The only way to get in is by invitation… and you can make sure you get the invitation by letting us know right now.
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| Dan Norcini on CME Gold Margin Increase Posted: 11 Aug 2011 09:52 AM PDT
He considers the silver margin increases back in May as a different story entirely. See full article here.
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| Gold to rally through 2012, S&P says Posted: 11 Aug 2011 09:40 AM PDT by Frank Byrt Gold futures (GC-FT1,770.00-14.30-0.80%) tumbled today after CME Group, owner of the world's biggest futures market, increased margins on gold contracts by 22 per cent. Gold had soared 8 per cent in the previous three days, bringing a one-year gain to 49 per cent, on U.S. and European debt concerns and a slowdown in global economic growth. "We believe that gold is in a bull market," writes S&P analyst Leo Larkin in a research note, because demand will outstrip supply "for the foreseeable future. "Gold's price still has room to run despite its stellar advance and we believe that the precious metal could also continue to carry the prices of certain gold-related equities right along with it," he added.
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| Desperate Swiss eye euro peg to repel safe-haven flood Posted: 11 Aug 2011 09:27 AM PDT By Ambrose Evans-Pritchard "Nothing is excluded," said Jean-Pierre Danthine, a SNB board member. "The situation is extremely complex and difficult. There is no magic wand." The Swiss franc has moved with gold over recent weeks, acting as a magnet for capital flight from the discredited debt currencies of West. The SNB said the franc is "massively overvalued" and has moved into dangerous territory over the past month. [source] PG View: So it begs the question; "massively overvalued" against what? That statement would suggest that the euro and the dollar are 'massively undervalued.' The franc just happens to be the best looking horse at the glue factory. The swissy remains near record lows versus gold: There's your true gauge of value.
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| Understanding Silver’s Recent Price Action Posted: 11 Aug 2011 09:10 AM PDT Author: Vedran Vuk Synopsis: While some may see cause for concern in the silver price's disconnect from gold's surge, Alena Mikhan examines recent trends in an historical context. Also in today's issue: Vedran Vuk compares the U.S. dollar to the euro; and Kevin Brekke recasts an infamous presidential testimony. Dear Reader, With almost every pullback in the market, the headlines have listed brief overviews of the daily winners. For example, a headline might read, "Stocks Decline, Treasuries, Gold, and Dollar Rally." These broad headlines miss the more nuanced picture, especially of the gainers – some aren't exactly doing so hot. One in particular is the dollar. Sure, it has seen gains, but considering the large drops in the market the gains aren't that impressive. In fact, these small advances shouldn't reassure U.S. investors; they should frighten the...
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| Posted: 11 Aug 2011 09:00 AM PDT The sun is shining. The sky is clear. The weather is warm. What a great day for a meltdown! Dow down another 519 points yesterday. Gold zooming towards $1,800…in fact, reports this morning tell us it has passed the $1,800 mark. And the 10-year T-note yield slipping down close to 2%. Are we at Armageddon, yet? "You don't know how pleased I am to live this long," said our mother, whose 90th birthday party will be celebrated in 3 weeks. "I will see two major depressions during my lifetime." Years ago, we guessed that the price of gold and the price of the Dow would converge. We also guessed that they would meet around 3,000. It seemed crazy when we first suggested it. Then, the price of gold was only around $500 an ounce, while the Dow was over 10,000…and still going up. That put the Dow to gold ratio at about 20 to 1…way down from the peak at 43 to 1 set at the end of the '90s. We said the ratio would go to 1 – to – 1. One ounce of gold would be equal in value to the 30 Dow stocks….just like it was, very briefly, at the end of the '70s. When would it happen? We didn't know. But it would feel "like Armageddon" when it happened. Well, now it doesn't seem so crazy. In order to get down to a bear market low, the Dow needs to be cut in half…and more. All we need is another two weeks like the last one. The price of gold could easily double from here too. In fact, it won't match its 1980 high – properly adjusted for inflation – until it is back near $3,000. And this time, it should go much higher. Whatever problem gold signaled back in the late '70s is worse today. Much more debt. More willingness on the part of the feds to "monetize" debt. More wobbly economies run by wobbly economists. The real problem is debt. It's been building up for more than half a century – thanks to encouragement from the same officialdom in whose hands the problem now rests. The feds think…or thought…they could deal with this slowdown the same way they dealt with every other post-war recession – by adding more and easier credit. That is, by increasing the amount of debt in the system. They tried direct spending – fiscal stimulus. They tried re-flating the banks. They put the key lending rate at zero. And now Bernanke says he'll leave it there for two more years! They even tried money printing – their QE I and QE II programs. Nothing has worked. Fewer people have jobs today than when the crisis began. Real incomes are going down. House prices are going down. The US has the lowest percentage of people gainfully employed ever recorded. The rich may be getting richer…but the poor are getting poorer, faster than ever. And real, private sector, per capita GDP is still going down. Bernanke once joked that if he ever got in such a situation he would know what to do: he would drop money from helicopters. Time to warm up the helicopters! But the feds are beginning to realize that it is not enough to offer more cash and credit; they have to do something about the debt. At least, we think they're beginning to realize it. Several top economists have appeared in the papers recently arguing in favor of actual debt liquidation as well as more stimulus. Both Nouriel Roubini and Ken Rogoff have written to support debt restructuring (reduction) initiatives. And even dodos such as Thomas L. Friedman have finally realized that debt is a problem.
Typical. He gets confused. You can't dig out when you're underwater. You drown. But at least he's beginning to understand what is going on. And since he is the last man on earth to understand anything…it is likely that even the feds are catching on. So what? Well, you'll begin to hear more about debt reduction as well as stimulus measures. They'll get the banks to write down mortgages, for example, in exchange for more cash from the government. This is classic political legerdemain. Debt doesn't go away. Ever. It has to be reckoned with. Moving mortgage losses to the government pushes the government further underwater. That will have to be reckoned with too. But not today, dear reader. Lenders are still buying US debt. As the Dow goes down, gold and bonds go up. The 10-year note is nearing a record high… This allows gives US authorities a lot of rope. They don't have to cut US spending. They can still bailout whoever they please. They can borrow…borrow…borrow…spend, spend, spend…until Daddy takes the T-bird away! Then, they can use all that rope to hang themselves. And more thoughts… Here is a very serious thought. As far as we know few people have written about it. Few have even thought about it. And no one has figured out what it means. But it could mean that the whole nature of the economy…and how we measure it…will have to change. More immediately, it is another cigarette for the wheezing Middle Class. The seed was planted by a headline from the Wall Street Journal. We didn't read the article. But we noticed the headline. Hmmm…. surely, the demand had not decreased. We began to think about why the porn industry might be less profitable. We'll take a guess – open source technology. It's now so cheap and easy to make and distribute dirty pictures that the profit must have gone a little limp. An amateur with an I-phone or a $100 filming aparatus can make a fairly clear movie. He can send it over the internet at no cost. So, the recipient can view it in the privacy of his home for nothing…or almost nothing. This is very different from the old days. You needed a whole crew to make a film of any sort…and expensive cameras, lights – all sorts of things. Then, when you had made the film, you put it on a reel and sent it all over the country…to physical theatres in dingy parts of town, where people drove in their automobiles to buy tickets and watch smut. Lots of middle class jobs involved. In the old days, the enterprise consumed large expenditures of energy – human and mechanical – to produce what was recorded as an increase in GDP and considered an increase in living standards. Energy = GDP = Standard of living = jobs. Now, very little energy is expended. Very little money is spent. No increase in GDP is recorded. Nor is there any measurable increase in standards of living. And jobs have been eliminated (no film crews, no drivers, no gasoline sold, no theatres built, no popcorn sold, no carpets cleaned). From an economic standpoint, the switch over to internet-based porn looks like a net loss. And yet, the pleasure of the viewer is as great or greater than ever. The clients are getting the same bang, so to speak, for many fewer bucks. Now, imagine this same principle applied to, say, warfare. The US spends trillions on defense. This is great – or so it seems — from an economic point-of-view. Lots of jobs making big ships and big tanks and big airplanes. Lots of energy used moving them around. Lots of money spent. Lots of support personnel and profits in the contractors' pockets. Lots of bribes (campaign contributions) for Congress too. But now imagine that, say, China figures it will challenge the US empire in a different way. Let us imagine that it spends just a little bit and figures out a way to scramble communications. Its signals crossed, the US battleship runs aground. The US airplane bombs the wrong city. The tank gets lost, runs out of fuel…and is abandoned. This is a purely hypothetical example, but it is how things work. Old imperial forces get fat and stupid. They are always ready to fight the last war! New challengers have to figure out new techniques and try new technology. But if it were to work out this way, communications technology would have done to the defense industry what it has done to books and pornography. It will have de-materialized it. Fewer jobs. Less energy. Less money. Fewer resources. Again, you get the same bang…with many fewer GDP bucks. Already, terroristas have noticed. Here's an article about how new open source communications technology is being used by England's rioters:
When property can be so easily vandalized, the benefit of owning it goes down. Asset prices fall. Lower asset prices make building and investing less attractive. But that's what Open Source does. It lowers the value of traditional capital – theatres/bookstores/battleships and so forth. And it kills jobs and wipes out GDP. The new economy may yield the same pleasures…the same quality of life…more or less. But it may also produce a nightmare: very high unemployment for a very long time. Here's Jeff Jarvis at the Huffington Post and on the case:
Regards, Bill Bonner, Double Depression originally appeared in the Daily Reckoning. The Daily Reckoning provides 400,000+ readers economic news, market analysis, and contrarian investment ideas. Follow the Daily Reckoning on Facebook.
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| Norcini - What to Expect After Short Covering & Margin Hikes Posted: 11 Aug 2011 08:59 AM PDT  With increasing margins hastening a pullback in the gold market, today King World News interviewed Dan Norcini, legendary Jim Sinclair's chartist, to get his take on what has transpired and how trading will be impacted in gold going forward. Norcini had this to say about the margin increase, "Margin hikes are a standard process that you see in any bull market. It doesn't matter whether it's gold or silver or crude oil, soybeans, cattle, whatever. Once a market begins to reach a state where it begins to make very, very wide price swings, you are going to get margin increases, it's just a normal part of what traders can expect when they are trading in the futures markets."
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| Back To Square Minus 1: Regulators Fail To Agree On Short-Selling Ban Posted: 11 Aug 2011 08:59 AM PDT
The latest iteration of the "rip your face off rally" was fun while it lasted. And now, it is, once again, about to be replaced with the "face your rip off" version, after the FT reported that European regulators have failed to agree on a coordinated short-selling ban, "leaving France and other advocates of the curbs considering unilateral action to stem the recent sharp falls in share prices." This means that the last ditch effort to prevent the daily wipeout in the FTSE MIB has now been pulled off the table, and all those who otherwise would have been forced to cover their halted futures positions as cash soared, will now sit pretty and wait for the market to come to them. It also means that while Europe could have potentially stood united, if even for a few more days, divided it will fall. But not all is lost: there is a potential loophole, and if the Borsa opens limit down, it may well be the final recourse: "The new European Union market regulator, Esma, is trying to co-ordinate action by national regulators and more conversations could take place today. A Thursday evening conference call was unable to reach unanimity." That, however, now appears like a long shot.
Yes, it is the market's fault it is behaving "dysfunctionally", and letting politicians intervene will surely fix it. Perhaps this news explains why gold has retraced nearly half its losses from this morning. Absent another margin hike from the CME today, we are fairly confident the intraday gap will slam shut very shortly.
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| Understanding Silver’s Recent Price Action Posted: 11 Aug 2011 08:48 AM PDT Synopsis: While some may see cause for concern in the silver price's disconnect from gold's surge, Alena Mikhan examines recent trends in an historical context. Also in today's issue: Vedran Vuk compares the U.S. dollar to the euro; and Kevin Brekke recasts an infamous presidential testimony. Dear Reader, With almost every pullback in the market, the headlines have listed brief overviews of the daily winners. For example, a headline might read, "Stocks Decline, Treasuries, Gold, and Dollar Rally." These broad headlines miss the more nuanced picture, especially of the gainers – some aren't exactly doing so hot. One in particular is the dollar. Sure, it has seen gains, but considering the large drops in the market the gains aren't that impressive. In fact, these small advances shouldn't reassure U.S. investors; they should frighten them. Consider that in mid-July the dollar crossed below the $1.40 threshold against the euro. Even with massive flights to safety, we're still above the $1.40 mark now. Here's a quick look at the EUR/USD over the last few months:
(Click on image to enlarge) After looking at this chart, one must ask, "Where are the gains in the dollar from flights to safety?" The USD has mostly stayed within a volatile range of $1.40 to $1.46. In light of the recent market crash, the dollar has strengthened only minimally. In fact, a few periods have showed stronger dollar rallies with much less activity in the market. Compare the beginning of May, June, and July to the current movements in the dollar – all of those periods saw bigger gains. However, the next chart is the most unsettling one. Let's compare the current price action to the dollar's strengthening during the 2008 crash. The difference is enormous.
(Click on image to enlarge) Now that's what I call a flight to safety. The dollar makes leaps in value in a clear trend. Only when the market calms down after this period does the dollar begin to slip against the euro. In the recent selloff, we should be extremely concerned about the USD. With this sort of market environment and the serious problems in the eurozone, the dollar should be making enormous gains against the troubled euro, but it's not. Instead, it's barely inching forward. So, what's going to happen when the risk-on environment returns? In my opinion, it could send the dollar tumbling. We have two articles for you today. First, Alena Mikhan discusses silver's recent price divergence from gold. Then Kevin Brekke presents an imagined conversation between Ken Starr and Tim Geithner. Finally, I'll return with a couple of interesting links.
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| Gold Warning, Cyclical 34 Month Bull Run is About to End Posted: 11 Aug 2011 08:38 AM PDT Gold hit $1805 tonight in trading, a Fibonacci Fractal figure I gave out a few weeks ago as a possible top. We are close to a near term high in Gold and Investors should be trimming back positions on this run. Back as recently as $1600 an ounce I forecasted a run to $1805 for Gold using fractal and wave analysis and behavioral patterns, now that we hit that figure it’s time to update the cycle and where we are.
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| Posted: 11 Aug 2011 08:21 AM PDT User submitted - Article Tyler Durden & Jim Willie Many deep dilemmas face investors of Gold & Silver. First and foremost we feel an urgent need to defend ourselves against a crippled corrupted USDollar....... Any nation that endorses the dispatch and forfeiture of a large portion of its industrial base to China for the expressed purpose of lowing its costs is moronic at best and suicidal at worst, but the real story is laced with yet more Wall Street intrigue..... The Max Keiser method of revolt is so simple. Each US citizen should purchase a single silver coin. The effect of the millions of flapping butterfly wings would bring down the JPMorgan pilars....... The people must take an oppositional position against the deeply infected financial markets and virus of false value of assets. In doing so, they must take action in self-protection of assets for themselves and family before the American Locomotive crashes into the abyss deep below....... The people must take an oppositional position against the power grab and asset grab as the Fascist Business Model enters a late chapter of destruction. In doing so, they must avoid a banking system that is insolvent from housing and mortgage assets, that is confiscatory with home foreclosure practices, that endorsed mortgage contract fraud in open manner, that is responsible for massive bond fraud that sells vacant toxic paper in the securities market, that is defensive in court rulings in a parade of negative decisions, that is embarking on capital controls to limit the flight of money.......... The people must take an oppositional position against the fear mongers and operators of the propaganda billboards and loudspeakers. In doing so, they must come to grips with a harsh reality. Of 20 defined signals, the United States qualifies in 17 criteria as being a Third World nation. The details smack the people in the face, from corrupted elections to vanishing middle class, from erosion of infrastructure to constant military aggression, from colossal bank fraud to syndicate control of the national money operations, from fast rising price inflation to the dire need to re-industrialize the economy, topped off by syndicated propaganda news media....... 
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| Gold Daily and Silver Weekly Charts - Bear Raid With Comex Margin Increases, Right on Cue Posted: 11 Aug 2011 08:16 AM PDT |
| Posted: 11 Aug 2011 08:00 AM PDT High-speed trading is turning the stock market is turning into a farce, and in the process is turning off an entire generation of investors. It's speeding up a process — P/E ratio compression — that normally takes a grinding bear market a couple of decades to accomplish. Even after the wake-up call of the May 2010 flash crash, the SEC has done little to foster a healthier market ecosystem. It looks like computer-driven, high frequency trading shops, which now account for the majority of trading volume, hammers stocks much more quickly than human investors And there aren't enough human value investors (at these prices) to absorb the supply of high-P/E stocks from high-speed trading shops looking to sell. These shops aren't liquidity providers; they're parasites that worsen volatility, extract economic rents from long-term investors, and make rational investors who aid the vital process of market efficiency want to throw up on their trading screens. As investment horizons have shortened, the market has gotten dumber — especially regarding the macro picture. Rather than doubt the sustainability of the economic stats in early 2011, the market didn't ask any deep questions, and rallied mindlessly. Now that we get a cluster of terrible data points in the space of the past week (downward GDP revisions, ISM near 50, etc.), we take the elevator down in gut-wrenching fashion. Common sense dictates that GDP and ISM numbers would weaken when new supplies of fiscal and monetary stimulus drugs were cut off, so why was this a surprise? Both forms of stimulus (fiscal and monetary) remain very aggressive, but it seems the stock market requires off-the-charts stimulus in order to maintain its high valuation. Even after the past weeks' selloff, the S&P 500 is still trading at a Shiller P/E ratio of 20. I think it's reasonable for it to trade down into the low-teens, because stimulus has temporarily pumped up corporate profit margins. The catalysts to drive the Shiller P/E into the low-teens should be some combination of stimulus hangover and a rising CPI. Don't listen to the strategists spouting "the Fed model" as justifying much higher stock prices. The Fed Model goes like this: "10-year Treasury yields are 2.5%, so the P/E on 'forward operating earnings' should be 30," or 35, or whatever number suits the strategist's objective. I heard a strategist selling this garbage on Bloomberg Radio this morning. First of all, the Treasury yield is a completely manipulated instrument, and doesn't correspond to the cost of capital for corporations through economic cycles. Secondly, the duration of stocks, however you measure them, is at least three to fours times greater than the duration of the 10-year Treasury, so it's comparing apples to oranges. The Fed model spits out dangerous conclusions for investors. Four years ago, John Hussman used robust statistical analysis to deconstruct and invalidate the Fed model. So the strategic outlook for stocks remains negative. Valuations remain high and headwinds will start blowing harder against corporate profits. As for the tactical environment facing stocks… Europe is the reason for yesterday's 5% market crash. Bank runs are rumored to be hollowing out the Italian banking system. This "fear trade" will likely continue until the European Central Bank reverses course from its tightening stance, and aggressively buys PIIGS bonds. Most central banks will yet again inflate their balance sheets, which will only exacerbate the stagflation plaguing the global economy. We should get a relief rally in the S&P 500, but probably not until we go lower — low enough to panic central bankers. German central bankers in particular will change their "hard money" tune once they see their domestic banking system at risk. I agree with the "hard money" central bankers' view on subsidizing the PIIGS, but ultimately, a critical mass of European central bankers will push for a policy of ballooning the ECB's balance sheet. After the next bout of coordinated global central bank easing, I think we'll transition into a grinding, sideways-to-down market. Gold prices should benefit from a new round of easing. This is not 2008. I'm confident at this point that the crisis has transitioned to the following: private capital and small business withering on the vine, as each sovereign debt flare-up elicits a new round of central bank easing. This applies to nearly every economy, including the U.S., the euro zone, China, and Japan. Crony capitalism is, unfortunately, still a dominant force. It slows the healthy process of creative destruction, slows the mobility of capital and labor, and keeps consumer prices higher than they otherwise would be. But it's the price we paid for the 2008 bailouts. Cronyism will eventually come back to bite most big banks and corporations as the inflation created to fund bailouts works its way into cost structures, which in turn shrinks profit margins. Regards, Dan Amoss, Crony Capitalism at Work originally appeared in the Daily Reckoning. The Daily Reckoning provides 400,000+ readers economic news, market analysis, and contrarian investment ideas. Follow the Daily Reckoning on Facebook.
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| Posted: 11 Aug 2011 07:27 AM PDT August 11 (Financial Times) — Food commodities prices surged after the US government slashed its forecast for the country's crops due to the impact of a heatwave and drought. The US Department of Agriculture painted a bullish picture in particular for corn prices, saying: "Unusually high temperatures and below average precipitation during July across much of the Corn Belt sharply reduced yield prospects." …But it could reduce central banks' room for manoeuvre as higher corn prices rapidly translate into more expensive beef, lamb, pork and poultry and, thus, higher food inflation. China, India and other developing countries have raised interest rates this year in part due to rising food inflation. [source] PG View: If food price inflation is indeed kicking in again, can a rebound in gold be far behind?
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| Posted: 11 Aug 2011 07:05 AM PDT Whoa! Another severe drop in the markets yesterday. The Dow ended the session down 4.6%, plunging through the 11,000-point mark along the way. The S&P 500 and the Nasdaq chartered a similar course, off 4.4 and 4.2% respectively. Both have lost more than 10% for the year. The Dow, too, has erased all gains earned over the past twelve months. What happened to the recovery? That word was all the rage until a few weeks back. "Welcome to the Recovery," wrote Treasury Secretary Timothy Geithner a year ago, in an op-ed piece in the New York Times. President Obama and his #2, Joe Biden, went so far as to call it the "Summer of Recovery." Well, where is it? And, more importantly, why do these men still have jobs? Why are they not selling fridge magnets from a tin tray on street corner somewhere? More on that tomorrow… In yesterday's reckoning, we promised a wee discussion on gold. But, with all our ranting and raving about the inexorable decline of the Anglo-Saxon Empire and the not entirely unrelated riots in London, we ran out of time. Today, we pick up where we left off. Gold scooted past $1,800 per ounce yesterday, before cooling a little to end the session around $1,790. That brings The Midas metal's gains for the past twelve months to around 50%. Not too shabby. Understandably, therefore, investors are wondering whether it too late to hitch their wagon to the gold train? Have they missed the action? Is the golden bull market, now a decade old, finally over? As usual, your editor has no idea. And, as usual, he will offer one anyway. But before having a look at the year ahead of us, let us first read the prologue. At the 2010 Agora Financial Investment Symposium in Vancouver, back when gold was on offer for the bargain price of just $1,200 per ounce, we made a prediction. It was prompted by the previous evening's Whisky Bar discussion. Members of the panel were asked to guess where gold and stocks would be in a year's time (today). Exact estimates varied, but the general consensus was that gold would be higher and stocks lower. They were half right. Not a member of the panel himself, your editor published his own guess in the following morning's issue of The Daily Reckoning. We had the same idea, but our method was a little different. Take a look: "[I]nstead of measuring the [Dow] index in points and the metal in dollars, we'll do away with floating abstractions and simply measure the index in metal. "Historically, the peak of a gold bull market/stock bear market occurs when you can pick up the 30 bluest stocks for about one, maybe two, ounces of gold. The Dow/Gold ratio, at that point in time, is said to be around 1:1 to 2:1. During the furor of tech. mania in the late '90s, early '00s, when the Midas metal was scoffed at in polite company, that ratio reached 45:1. In other words, it would take you 2.8 POUNDS of Mother Nature's money to buy the Dow. "During the past decade, as stocks stagnated and gold rallied fourfold, that ratio has slipped dramatically. Today, it takes about 8.6 ounces of gold to buy the Dow. Our bet, for what it's worth, is that this trend continues for a while yet. Next year, we're probably looking at a Dow/Gold ratio of about 6:1…and not because the Dow goes to 60,000." This morning, with gold at $1,780 and the Dow at 10,719, we hit the mark: the Dow/Gold ratio is, exactly, 6.02:1. So it took 55 weeks for our one-year prediction to come to pass. That's close enough for us. Of course, past performance is not necessarily indicative of future ability. As the old saw goes, even a broken clock is right twice a day. Nevertheless, we'll stick with the thesis that led us to last year's conclusion…and use it to inspire this year's guess. The rational behind it is simple: A bet on gold is a bet against the Bernankes, Obamas and Geithners of the world. It is a statement that says "I don't believe you know what you are doing, sir." With that in mind, we reckon the Dow/Gold ratio will contract further still, meaning it will take fewer ounces to purchase the 30 stock index a year from now. How many, exactly? Good question… All sorts of things could happen over the next twelve months, events that could jolt markets hither and gold thither. For one, QE3 is definitely on the cards. The Fed Head said so himself. And Wall Street is calling for it too. Then there's China's "nuclear option" in the bond market…the fracturing of the eurozone…the Arab Spring across North Africa and the Middle East…and plenty more the Gods have in store that is beyond our earthly imagination. Still, it's no fun if you don't have a little "skin in the game." So we'll tempt fate and take a shot. We already reckon the general trajectory will be the same. Now let's go out on a limb and suppose that market uncertainty intensifies and that the collapse of the western powers accelerates. And let's take Bernanke at his word and assume he cranks his printing presses into overdrive. But where does that leave the terms of the relationship, you ask, the values of the antecedent and the consequent? How the Heck should we know? Remember, we're just a broken clock, hoping to be accidently correct twice. You're on your own from here. Well, not completely…Bill has more on stocks and gold below. But first, here's our resident short selling maven, Dan Amoss, with a look at flash crashes, the SEC and other farcical market conditions. Enjoy… Joel Bowman, Long Lost Lovers originally appeared in the Daily Reckoning. The Daily Reckoning provides 400,000+ readers economic news, market analysis, and contrarian investment ideas. Follow the Daily Reckoning on Facebook.
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| Margin Hikes help derail gold; HIgher Equities also hurt Posted: 11 Aug 2011 07:02 AM PDT [url]http://www.traderdannorcini.blogspot.com/[/url] [url]http://www.fortwealth.com/[/url] I was a bit surprised last evening NOT to see some selling related to the margin hikes announced by the CME Group yesterday for carrying futures contracts in gold. Eventually however, the selling did kick in. Along with the upside move in the equity markets in today's session, that was enough to take some of the wind out of the gold market and bring it back down to earth for a bit. We have had a nice run higher which was threatening to get out of hand due to the very steep angle of ascent being created on the price chart ( remember what happened to silver earlier this year) so some retreat in prices and HOPEFULLY a bit of stability in the gold price after some consolidation will be most welcome. We also need to give some time to the big physical markets of Asia to get accustomed to a higher gold price. Wild swings higher in price tend to scare some buyers away over there initially until they be...
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| Posted: 11 Aug 2011 06:51 AM PDT courtesy of DailyFX.com August 11, 2011 07:49 AM 300 Minute Bars Prepared by Jamie Saettele, CMT “Analyzing structure from the July low suggests that a series of 4th and 5th waves should unfold. In other words, gold is headed higher but with corrections along the way. Near term support is 1740 and 1720. The next upside objective is not until 1926.50.” Trend Strength (M,W,D) – 3, 2, 3 Latest Video COT Jamie Saettele publishes Daily Technicals every weekday morning, COT analysis (published Monday), technical analysis of currency crosseson Wednesday and Friday (Euro and Yen crosses), and intraday trading strategy as market action dictates at the DailyFX Forex Stream. A graduate of Bucknell University, he holds the Chartered Market Technician (CMT) designation from the Market Technician Association. He is the author of Sentiment in the Forex Market. Send requests to receive his reports via email to [EMAIL="jsaettele@dailyfx.com"]jsaettele@dailyfx.com[/E...
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| Silver and gold update – The fiat dollar Posted: 11 Aug 2011 06:17 AM PDT This is courtesy of Brother JohnF He does an excellent job not only in updating the performance of silver and gold, but in explaining in very simple terms the history and evolution of currencies used in trading between countries. He sheds light on the dilemma faced by the dollar as our current international currency system. [...] 
This posting includes an audio/video/photo media file: Download Now |
Early in the evening yesterday, the Chicago Mercantile Exchange jacked up margin requirements to buy gold futures by 22%.
The effect of the margin hike, however, has been muted. After topping $1,800 for a few minutes yesterday, gold is down to $1,757 as we write — still a solid $100 above where it was at this time a week ago.
"100 Ingots to Win: Today You Can Get Gold With Bild" reads the main headline today on Germany's top-selling newspaper, Bild. The front page has forsaken its usual topless model in favor of gold bars… which the paper is giving away all day.
"It is our duty to not only to remain long gold," advises Dennis Gartman, "but to buy more on corrections as they occur."
"This is a case where the horse has left the barn and he's going to run for a while," adds 
Last week, the gold stocks acted like all stocks… they fell.
"Oil is falling," adds Chris Mayer, pinpointing another support for the gold stocks. "Oil is a gold miner's biggest expense.
Silver is retreating along with gold this morning. At last check, an ounce was fetching $38.39. But a long-term bull story remains in play here, too.
Stocks moved up to begin the day. A better-than-expected number on first-time unemployment claims has been good enough to push the Dow back above 11,000.
Bank stocks are moving up even stronger than the broad market. Bank of America, which sank below $6.50 Monday on a 
"Long thought to be a relic of the 19th century, debtors' prisons are still alive and well in Michigan," declares a press release from the ACLU — which has taken up the case of a man who went to jail because he couldn't scrape together the money for a $215 fine.
A woman, outraged over the debt ceiling charade in Washington, hired a small plane to fly a banner over the Capitol.
"So," a reader writes after seeing yesterday's video clip, "what Mr. Ratigan is suggesting is President Obama should go to the people and ask to be given temporary absolute power, ignoring Congress, the Senate and the rest of the carefully crafted checks and balances, so that he can clean up the nation and get rid of the corruption in Washington."
"I agree with this outburst," writes another reader. "However, I think that the only way to do something is to revolt with our vote by voting for qualified third-party candidates of the largest third party in each state."
"The reason for silver not following its brother gold," a reader suggests, "is the bankers (J.P. Morgan) are controlling it by constantly shorting it with paper shorts.
"Yes, silver is an industrial metal, too," writes another, responding directly to what we said yesterday. "But it is still a monetary metal, in a way that even platinum is not. Would love to see you comment more in depth."
"Similar to the reader that did a refi on an apartment building," writes a charter 
"I've followed you for a couple of years now and never sent a reply — time I did," writes a reader from the U.K. "I'm not wealthy — not close — but am wealthier for following your advice — so cheers! Your publication is pithy and informative and is my essential daily read."
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