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Monday, September 26, 2011

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After The Crash, A Revised Outlook On Gold And Silver

Posted: 26 Sep 2011 06:12 AM PDT

By Simit Patel:

For those who haven't entered the gold market, or for those looking to accumulate more, now is the best time to buy (although a reversal from here should emerge soon; if new lows are established, this view will need to be re-evaluated).

The recent crash has not altered the underlying fundamentals one iota, and in fact a periodic retracement helps push short-term speculators purchasing with leverage out while allowing cash buyers to come in. The solution to the global debt crisis is debt restructuring -- not adding more debt to pay off existing debt, which is what the various forms of bailouts led by central banks do; Bernanke's Operation Twist is simply more use of words/propaganda to mask the fraudulent nature of contemporary monetary policy, and the same can be said for the Stabilization Fund talks in Europe.

Those familiar with technical analysis should be able to identify that the


Complete Story »

Top 10 Most Shorted Solar Stocks

Posted: 26 Sep 2011 06:08 AM PDT

By Stoyan Elitzin:

Solar stocks have gotten obliterated across the board in 2011. Fierce competition has resulted in a significant drop in average selling prices. That, along with the slashing of government subsidies in Europe, has reduced or eliminated profit margins for many solar companies. Of course, this has been great news for solar bears. Those who predicted this collapse and sold short have profited significantly.

Let's look at the 10 most shorted solar stocks, based on the number of shares held short divided by total shares outstanding (float), along with the estimated number of days to cover:

Company

Ticker

Short Interest

% of Float

Day to Cover

(in millions of shares)

1. LDK Solar

LDK

37.28

27.1%

7.5

2. Energy Conversion Devices

ENER

14.23

26.7%

18.8

3. Trina Solar

TSL

16.59

23.1%

5.3

4. First Solar

FSLR

17.06

19.7%

8.3

5. GT Advanced Technologies

GTAT

24.57

19.4%

6.1

6. Suntech Power Holdings


Complete Story »

Don't Freak Out Over Gold - Stay Rational, Not Emotional

Posted: 26 Sep 2011 06:06 AM PDT

By Richard Bloch:

Carlos X. Alexandre writes that "Gold 'Believers' Appear Distraught Over Dollar Strength," although he didn't seem to quote anyone who appeared distraught.

And most of the commenters didn't seem all that distraught. I did sense some haughty "serves you right goldbugs" vibes, but who could possibly be distraught other than those who bought gold this year? Anyone who bought a year ago, two years ago, three years ago (well you get the idea) is sitting on some nice profits -- even if gold moves all the way down to its 200-day moving average around $1500.
Why is gold so emotional – among bulls and bears alike? Nobody gets emotional about shares of Apple (AAPL) [okay, bad example, make that Procter & Gamble].
Yet the emotional aspects of gold contrasted interestingly with another article that appeared the same day, Roger Nusbaum's piece on the stock market, "The Market Is Freaking Out:

Complete Story »

Why The Markets Went Down Last Week

Posted: 26 Sep 2011 05:46 AM PDT

By Peter Mycroft Psaras:

Because of excessive margin buying (borrowing money to buy stocks) in the stock market by investors we will classify as large hedge funds and professional traders, day traders etc., through instruments such as ETFs, etc., margin calls (where you have to pony up more cash or your broker starts selling your positions) were triggered for many last week. This is the fastest way to the poor house. I tried it back in 1987 and have refrained from using it again as I got hit with a margin call at the ripe old age of 23 and it took out 30% of my nest egg at the time. Well now we have billion dollar hedge funds using leverage to buy stocks, gold, silver and commodities and they are getting margin calls in excessive amounts. So all this leverage is hitting the commodity markets as hedge funds are so underwater in their


Complete Story »

Long Term Treasuries About To Decline

Posted: 26 Sep 2011 05:46 AM PDT

By Avery Goodman:

So far, given the announcement of the recent "Operation Twist," in which the Federal Reserve promises to buy $400 billion worth of long term U.S. bonds, the price of 30 year bonds have risen, and yields have gone down. That is about to end. The Federal Reserve is the most powerful central bank in the world, because it controls the supply of U.S. dollars and the short-term interest rates relating to the dollar, which is still the world's "reserve" currency.

"You can fool all of the people some of the time, and some of the people all of the time, but you can't fool all of the people all of the time." The Fed has managed to fool huge numbers of people into buying treasury bonds by engaging in repeated bouts of quantitative easing wherein it buys bonds with newly printed dollars, and supports prices. That is about to end,


Complete Story »

Gold is Getting ‘Fixed’ (NFTRH154 excerpt)

Posted: 26 Sep 2011 05:24 AM PDT


On Friday, the conspiracy pieces were flying (some to my inbox) as indignation surged
while gold tanked. One was forwarded by fund manager, NFTRH subscriber and all
around sharp guy LL, to which I responded (pardon the crude descriptor for 'momo's'):

"L, let me ask you this. Why then did my charts tell me low to mid 1600′s weeks ago? I
am not trying to toot any horns, but I dismiss the conspiracy rationalizations. Too many
a-holes bought gold IMO. Now it is being fixed."

We know (or should know) that gold is gamed and worked over in myriad ways by
powerful people seeking to shape perceptions (we are in the midst of the 'misperceptions
game') out of desperation. But the correction in gold was necessary because these are the
markets and in the markets, dumb and emotional money never wins out.

Thus, the folks that outright panicked in the face of the Euro crisis and the US debt
debate folly were always slated to be washed away because they are what should be
considered unhealthy holders; weak hands that bought in knee jerk fashion rather than in
service to a sensible, ongoing plan (the 'knee jerk' into gold was part of the reason I
wrote To The Newly Minted Gold Bugs [http://is.gd/VoXBmj] in August). Also, a
severely over bought chart did not hurt the correction case one bit. Anyone could see this
coming. Spare me the rationalizations; it is time to think like a winner, not a loser.

Precious Metals – Gold

Was that a capitulation I saw on Friday as all the blinking red lights on my screen seemed
to light up like a Christmas tree gone berserk on Friday afternoon? I am not sure; nor do
I really care. What I care about is that this chart is no longer over bought by greedy and
fearful momentum players. No matter what conspiracies the vast, internet-based gold
bug 'community' burps up, this chart had to be fixed.

Gold declined on heavy volume on Friday, filled the gap and satisfied the 62% Fib.
Technically, there could be additional downside to the EMA 200, former channel bottom
and lateral support at around 1550. But the chart is getting fixed. You get bullish on
gold when it is hated, not when it is loved. RSI is coming to a support zone, MACD
has been totally corrected, and we have patience.

'Public Opinion' sentiment was (finally) beginning to come off the highs as of
September 20th. Want to bet that it is much healthier now? The public's dogged fixation
with gold, however brief, was a troubling indicator. It is notable that the sentiment in
silver was already significantly compromised as of the 20th and commodity sentiment
was in the dumps.

I make many moves during the week out of instinct, but the work I do on Saturdays often
confirms why I should have (or should not have) made those moves. Today's work tells me exactly why I covered all short positions against commodity related items. Public
opinion is now supportive of rebounds in the precious metals and especially
commodities. 'Supportive' is not a mandate for an immediate relief rally, however.

Here I will note that targets remain lower on things like base metals, and silver's chart
looks awful. So we should be aware of the possibility of a snap back rally perhaps to test,
and potentially fail at, broken supports.

Back on gold, also as of the 20th, gold's CoT structure looked good as large speculators
got less long and commercials less short. Take a guess how it may look as of the end of
last week. Hedge funds are getting their grubby hands off of the play. It is not a play; it
is a hunk of insurance and monetary value.

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Explaining Gold's Move

Posted: 26 Sep 2011 05:20 AM PDT

By Scott's Investments:

Ben Bernanke's announcement last week of Operation Twist, the strategy of selling short term treasury holdings and purchasing longer term treasuries in an effort to lower long rates, coincided with a sharp selloff in Gold. The US Dollar also strengthened last week, with UUP, the Powershares DB US Dollar Index Bullish ETF, finishing the week up 2.12% and up 5.61% the past month.

Given the nature of Operation Twist, I began by asking what correlation, if any, does the dollar or US Treasury interest rate spreads have on Gold? One way to analyze the relationship between Gold and interest rate spreads is to look at the correlation between GLD and FLAT, the iPath US Treasury Flattener ETN, which I first featured earlier this month. FLAT seeks to replicate the inverse performance of the Barclays Capital US Treasury 2Y/10Y Yield Curve Index. In other words, a flattening of the 2 year/


Complete Story »

Goldrunner: The Gold Tsunami Wave Cycle

Posted: 26 Sep 2011 05:13 AM PDT

www.GoldrunnerFractalAnalysis.com

The Gold (and Silver) bull continues to closely follow the giant wave formation of a tsunami.  The recent more parabolic rise in Gold up to above $1,900 is analogous to the little ridge of water we first saw way out in the distance, and now, much like when the waters recede from the shore early in the tsunami wave formation, Gold is undergoing a correction.
As the "Gold" waters receded, the diehard deflationists have run out onto the bare sea bed to whoop and holler that the sea of Dollar Inflation is ending.  They currently hop about the nearby sea floor waving their arms in victory as they envision a catastrophic deflationary depression that will wreck the financial market back to the Stone Age, and the price of the Precious Metals along with it.  Unfortunately, they fail to understand the wave cycle at work as the waters are sucked away from the shore only to strengthen the Gold tsunami wave that grows in the distance For the great Gold tsunami wave is being bolstered as the economy deteriorates, thereby necessitating a continued parabolic growth of printing of paper currencies worldwide.  Where the first little parabolic rise in Gold merely caught the attention of the public, the growing strength of that wave as it reaches shore will leave everyone running for the hills of Gold and Silver.

The Fed Shows Inflation When They Want To and Deflation When They Want To

Last week, the Fed met for a special two-day meeting that ended with a dull thud as they announced "The Twist" that sounds a bit like a dance from the 60s.  They also stated that the economy was weakening – economic weakness that has motivated them to aggressively inflate the US Dollar for 10 years, now.  Yet, market expectations were for the Fed to announce another round of Dollar Inflation via QE3 at the special 2 day meeting so the markets sold off in response to the failure of the Fed's announcement.
What occurred in the Precious Metals markets seems a bit absurd as Gold and Silver were pounded aggressively lower in price though the Fed often leads rounds of Dollar Inflation with suggestive hints of deflationary pressures.  To some extent it defines the need for their move, and it probably intends to show that they are in control of something that they cannot control.  The massive deflationary backdrop of debt demands that they either "inflate or die."
Commentators noted that the exaggerated fall in Gold, Silver, and in the PM stocks resulted from margin calls "where investors sell what they have to sell."  Yet, the extent of the weekly fall in the DJIA was rather small compared to the 2 week fall back in early August – a time when Gold, Silver, and the PM Stocks moved higher.  A more likely cause for the fall in the PM sector lies in the Fed's failure to announce QE3 as it pointed to economic weakness, combined with this coming Tuesday's Gold and Silver options expiration date – a monthly bashing that generally sees Gold and Silver whacked to lower levels.  Further downside pressure on the PM sector probably stems from big trading firms reversing their "long Gold/ short PM stock ratio trade."  The large swings in the Gold price over the last 30 days provided the volume they needed to sell paper gold, and to cover and accumulate the Gold and Silver shares.  Given the timing one has to wonder whether these large traders are the same firms who trade for the Market Stabilization Fund, and if they knew in advance that the Fed would tip its comments to deflation this week.

The Gold Chart

The following Gold Chart shows that the cyclical tendency since early 2009 has been for Gold to bottom at the green arrows with Gold correcting down to and through the dotted Bollinger Band (BB) mid-line to hit the 34 week exponential moving average while the RSI Indicator approaches the 50 line.  Gold fell to the BB mid-line on Friday as the RSI approached the 50 line.  Black rays off of the 2008 top show that Gold has been bottoming at each black line extended over the "last top."  Gold reached that juncture on Friday.  We might see Gold weakness early next week, but we expect the basic relationship to hold.  Near this point in the 70's Gold Chart, an imminent bottom produced a sharp rise.

REVIEW OF OUR EXPECTATIONS

  1. A major bottom for the PM stock indices is now in place as we laid out for subscribers (see HERE for subscription details) early in the week of August 8th based on the fractal relationship to 1979.
  2. Price and the technical Indicator readings for the PM Stock Indices continue to track the 1970's with much higher prices expected in the intermediate-term. Per the 70's PM Stock Model we expect this run to be the first, and smallest, of 3 momentum runs to come for the PM stock indices over the next few years. The mid-900s appear to be a realistic target for the HUI Index into year-end, or into early 2012.
  3. We have reached the point in the cycle where leverage returns to the PM stocks with a vengeance per the late 1970s charts.
  4. The fundamentals for Gold, Silver, and the PM Stocks could never be better.  In fact, the Fed's announcement this week was read as "deflationary", where in reality it screamed, "We must launch an accelerated program of Dollar Inflation, and soon!"
  5. Gold has now corrected in a very similar time sequence to the late 70's, though the depth of the correction has been deeper over the last 2 days. Current Gold price relationships to the Bollinger Band mid-line and 34 EMA line suggest that an intermediate-term bottom is likely due this coming week.  Such a bottom would fit the 70's model nicely.
  6. The US cannot pay its "regular bills" and interest on its debt, based on its current cash flow, much less cover other important needs that are growing astronomically.  We now depend on the Fed printing an accelerating number of Dollars.  This is what QE is – pure debt monetization that devalues the US Dollar aggressively.  For the U.S. economy, it is either "print or die."  We expect that the Fed will print while acting like they have some choice in the matter other than a total Deflationary Depression.  This fact has been true since early last decade.
  7. The Fed generally appears to prefer to see the prices of Gold, Silver, and the Commodities correct to create overhead resistance on the charts before they announce Dollar Inflation moves.  That is probably what was intended via the announcement at their special 2-day meeting creating the exaggerated fall in the PM sector this week – coupled with the usual sharp weakness going into Gold and Silver options expiration, next Tuesday.
  8. With the big funds ending the long Gold/ short PM stock ratio trade, the PM stocks should be heavily supported after this bottom is complete.
  9. The long-term PM Stock Model from the 70's suggests that we will be entering the "sweet spot" of a 3rd Wave advance as soon as this correction is over.
  10. Our upside targets for Silver for this run into late 2011/ early 2012 of $52 to $56 should be achievable for silver, with $58 to $62 as real possibilities.
  11. We still expect all of our intermediate upside price objectives for Gold to be reached by late this year, or early next.  We expect the next run in Gold to reach the $2250 level and $2500 level before a higher run takes us up to $3,000 Gold, or higher.
  12. The recent exaggerated decline in the PM sector will likely act like pulling and letting go of a huge rubber band in terms of how the PM sector will advance after this correction ends.
  13. An end of the aggressive and accelerating course of US Dollar Inflation at this time by the Fed would create a deflationary depression that would dwarf that of the 1929 era yet the Fed has gained the right from Congress to inflate to infinity if necessary.  That right is the major difference between today and 2008 when nobody could foresee the Fed moving to aggressive Dollar Inflation via debt monetization after they blew out the banking multiplier loan system of Dollar Inflation.  Debt monetization, QE, is a more permanent form of Dollar Inflation that cannot easily be reversed, thus the Dollar Devaluation via QE will be mostly permanent leaving a more permanent high price of Gold when it is all over.
  14. We believe that we lie at a "load the boat moment" in this historic Gold and Silver bull for Gold, Silver, and the PM stocks.

Summary

  1. The mid-900s appear to be a realistic target for the HUI Index into year-end, or into early 2012.
  2. $52 to $56 should be achievable for silver, with $58 to $62 as real possibilities, by late 2011/ early 2012
  3. The next run upward in Gold to the $2250 level followed by $2500 with the potential for $3,000, or a bit higher, is now on the radar screen for late this year, or early next.

To keep abreast of daily developments in what is happening with physical gold and silver, various PM indices and specific gold and silver mining and royalty stocks please subscribe to our service here. To read more of public access articles please go here.
For the moment………………..Goldrunner (Sunday 09-25-11) goldrunner44@aol.com
Please understand that the above is just the opinion of a small fish in a large sea.  None of the above is intended as investment advice, but merely an opinion of the potential of what might be.  Simply put: the above is a matter of opinion and is not intended as investment advice. Information and analysis above are derived from sources and utilizing methods believed reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Comments within the text should not be construed as specific recommendations to buy or sell securities. Individuals should consult with their broker and personal financial advisors before engaging in any trading activities. Do your own due diligence regarding personal investment decisions.  In the interest of full disclosure, GOLDRUNNER is personally invested in the Precious Metals sector including various Precious Metals and other individual stocks.  GOLDRUNNER reserves the right to modify or eliminate any or all positions at any point in time.

There Will Never Be A Good Time For Greece To Default

Posted: 26 Sep 2011 04:55 AM PDT

By Peter Tchir:
My view is that Europe needs to let Greece default. Europe needs to abandon the existing perimeter and fall back to a more defensible position. Europe doesn't need to collapse, but it does need to retreat to a core, stronger position, where it can dig in its heels and defend itself. Battles are not lost because every soldier is killed, battles are lost when morale gets so low that the soldiers give up and flee for their lives. Wars are won when isolated, broken units are captured

Complete Story »

Marc Faber: “Gold Is Quite Oversold. I Will Consider Buying Gold Over The Next Two Days”

Posted: 26 Sep 2011 04:53 AM PDT

Anyone trading gold and silver most likely had a heartattack this morning. Of that subset, anyone who survived and traded with conviction made a killing, following an impressive surge in both metals, which saw silver soar from $26 all the way back to $30, after it was made clear that there was no behind the scenes liquidation of the metal but merely more piggybacked margin hikes this time out of China as was first reported by Zero Hedge. Another factor that helped was Marc Faber's appearance on CNBC earlier, who said that gold is now "quite oversold" and that he would be adding to the yellow metal in the "next two days." In retrospect, he should have been adding today to his existing holdings. However, since he already has 25% in gold, he is forgiven. Mutual funds which, however, have about 1% in gold, are not.

Some of the key soundbites from Faber: "Gold is quite oversold and I would consider buying some gold in the next two days… We overshot on the upside when we went over $1,900. We're now close to bottoming at $1,500, and if that doesn't hold it could bottom to between $1,100-$1,200. "Both equity markets and gold markets have become very oversold, and I think a rebound is occurring. Following this rebound, which I expect to get underway this week, there will be a longer slowdown." In other words, Faber shares our undying certainty that should stocks plunge and they will once the rumor mill halflife is measured in nanoseconds, the Fed will have no choice but to intervene again, with trillions of monetization. We speculate that that would not be exactly negative for gold…

And naturally, CNBC's spin on this same interview is that according to Faber gold is plunging to $1,100… Sigh.

Gold and Silver Get Sold Heavily, Markets Erratic and Seeking Consensus - Washington is Quiet

Posted: 26 Sep 2011 01:34 AM PDT

How to play the dip for the monthly investor?

Posted: 26 Sep 2011 01:33 AM PDT

With the current dip in prices I'm wondering what I should do and would love some suggestions.

Currently I'm buying monthly (have been since April). My budget is $250 a month. However, with the steep declined the past few days I'm thinking about the opportunity to load up at these prices and not buy again for several months (until the amount I spend equals the time it would have taken otherwise to save the money).

I'm thinking about taking the next 3 to 6 months of investments (so $750 to $1500) and make a big purchase and split it 50/50 on silver and gold.

Any thoughts about that?

p.s. I'm in this for the long term.

Gold and Silver Pullback as Forecasted Now for the Big Opportunity - Part 2

Posted: 26 Sep 2011 01:29 AM PDT

Marc Faber is ready to buy more gold

Posted: 26 Sep 2011 01:22 AM PDT

From Zero Hedge:

Anyone trading gold and silver most likely had a heartattack this morning. Of that subset, anyone who survived and traded with conviction made a killing, following an impressive surge in both metals, which saw silver soar from $26 all the way back to $30, after it was made clear that there was no behind the scenes liquidation of the metal, but merely more piggybacked margin hikes this time out of China... as was first reported by Zero Hedge.
 
Another factor that helped was Marc Faber's appearance on CNBC earlier... He said that gold is now "quite oversold" and that he would be adding to the yellow metal in the "next two days." In retrospect, he should have...
 
Read full article...

More from Marc Faber:

Must-see: The greatest Marc Faber interview EVER

Marc Faber: This asset could soar no matter what happens next

Marc Faber: The three commodity investments you must buy now

Your Local Silver Field Reports

Posted: 26 Sep 2011 01:21 AM PDT

silver Shield

Looking Back At The Last Month In Gold

Posted: 26 Sep 2011 01:19 AM PDT

Fundamental View

Don't worry about the fall in gold... This is what you should be watching instead

Posted: 26 Sep 2011 01:01 AM PDT

From Gonzalo Lira:

People are freaking out that gold has fallen to $1,650, from its lofty highs above $1,800 -- they are freaking out something awful. "Gold has fallen 10%! The world is coming to an end!!!" I myself took a shellacking in gold --

-- but copper is what has me worried.

Copper fell from $4.20 to $3.25 -- close to 25% -- in about three weeks. Most of that tumble has happened in the last 10 days, and what's worrisome is that, as I write these words over the weekend, there is every indication that copper will continue its free fall come Monday.

From the numbers that I'm seeing -- and from the historical fact that copper tends to fall roughly 40% from peak to trough during an American recession -- there is every indication that copper could reach $2.67 in short order. And even bottom out below that -- say at $2.20 -- before stabilizing around the $2.67 level.

But we'll see. The price of copper is not the point of this discussion. The point of this discussion is what the price of copper means.

What it means for monetary policy.

We all know the old saying: "Copper is the only commodity with a Ph.D. in economics," or words to the effect.

The ongoing price collapse of copper signals...

Read full article...

More on copper:

SocGen: Stay away from copper now

"Dr. Copper" could be sending an urgent warning

Why even short-term traders should listen to "Dr. Copper"

London Gold Exchange KAAAAAAAAAAABOOOOOOOOOOOOMSKIE

Posted: 26 Sep 2011 12:55 AM PDT

Jim Rogers: The U.S. dollar is not a "safe haven"

Posted: 26 Sep 2011 12:54 AM PDT

From Newsmax:

Investor Jim Rogers is holding U.S. dollars, even though he says they are not the "safe haven" many investors appear to believe.

The dollar "is going up against everything right now" for a number of reasons, one of which may be that everybody is panicking, "and for some reason, they're rushing into the U.S. dollar," Rogers told CNBC.

"The U.S. dollar is not a safe haven, if you ask me. But I do own it," says Rogers. "Agriculture prices [are] getting banged right now. I am kind of planning on buying Swiss francs, more dollars, and agriculture."

China, Rogers says, is doing its best to cool its overheated economy, which is...

Read full article...

More from Jim Rogers:

Jim Rogers: This is what QE3 will do

Jim Rogers: Higher food prices will spark riots soon

Jim Rogers pledges to support Ron Paul for president

London Metal Exchange Facing Takeover Bids

Posted: 26 Sep 2011 12:44 AM PDT

What if Asia interest got ahold of it??

The London Metal Exchange, founded 134 years ago above a hat shop in the financial district, may be the latest major mutual exchange to be bought after record trading volumes attracted the interest of multiple bidders.

The bourse is valued at about 160 million pounds ($247 million), based on the last published price of its closely held shares, according to Niamh Alexander, an analyst at KBW Inc. in New York. The exchange's value may be "significantly more" than its 2010 net income of 9.5 million pounds would suggest because so few exchanges of its kind are for sale, said Ruben Lee, chief executive officer of Oxford Finance Group, a London- based company specializing in financial and commodity markets.

The LME, which said Sept. 23 it had received "several expressions of interest," handles about 80 percent of global trade in metals futures. Prices more than tripled in the past decade as demand from emerging markets led by China overwhelmed supplies from mines. The LME, which is owned by its members, handled $11.6 trillion of contracts last year, compared with $2.5 trillion in 1999, reflecting both higher prices and increasing speculative interest in raw materials.

"The LME is the last major mutual exchange," said Christopher Gilbert, a professor at the University of Trento in Italy who has followed the bourse since 1971. "A change in ownership will shift the balance of power within the exchange from the industrial users toward the financial community."

The LME said Sept. 23 it would "begin a formal process which may or may not lead to an acceptable offer for the company being received." The exchange hired U.S. investment bank Moelis & Co. to advise it. Miriam Heywood, a spokeswoman for the exchange, declined to elaborate on the statement.

Singapore Exchange
Bidders may include CME Group Inc., the world's largest futures market, IntercontinentalExchange Inc. and Singapore Exchange Ltd., KBW's Alexander wrote in a report. Allan Schoenberg, a spokesman for CME in London, Kelly Loeffler, a spokeswoman for ICE in Atlanta, and Carolyn Lim, a spokeswoman for Singapore Exchange, declined to comment. London Stock Exchange spokesman Ed Clark also declined to comment.

CME, based in Chicago, bought the New York Mercantile Exchange for $7.6 billion in August 2008, while ICE, based in Atlanta, bought the New York Board of Trade in 2007 for $1.79 billion, according to data compiled by Bloomberg. Singapore Exchange's A$8.3 billion ($8.1 billion) offer to buy ASX Ltd., the owner of Australia's main bourse, was blocked by the Australian government in April.

Singapore Exchange and the LME have cooperated in introducing copper, zinc and aluminum futures on the Southeast Asian bourse. The LME-SGX contracts of five metric tons each started trading in February and compare with the benchmark 25- ton contracts traded in London. The bourse operator is not looking for other merger opportunities, said Magnus Bocker, chief executive of Singapore Exchange, this month.

'A Jewel'
"There are in fact very few successful exchanges that are actually up for sale, so the LME is in that sense a jewel," said Lee of Oxford Finance Group. "The most likely bidders are going to be the cash-rich exchanges which already have a footprint in commodities. The LME has to be attractive to the Asian exchanges, and it could be any one of them."

Buying the LME would be a "relatively small" acquisition for either CME or ICE, KBW's Alexander wrote in her report. A new owner could raise the exchange's earnings by handling its clearing, bringing back fees for market data and increasing trading costs, she said. CME and ICE already have their own clearing systems.

The LME clears trades through LCH.Clearnet Group Ltd., in which it owns 3.27 million shares, and said in May it was considering setting up a new clearing system to boost profit. The exchange appointed Trevor Spanner, chief operating officer of European Central Counterparty Ltd., as managing director of post-trade services this month.

Glencore Share Sale
Interest in commodities surged in the past decade as shortages drove prices higher. Investors held about $431 billion in raw materials by July, an almost fivefold gain in six years, according to Barclays Capital. Glencore International Plc, the Baar, Switzerland-based commodities trader, sold shares in May, ending more than three decades of operating as a closely held partnership. The offering valued the company at $59.2 billion.

The LME has 92 members listed on its website, including units of Goldman Sachs Group Inc., Barclays Plc and Citigroup Inc. There are seven categories of membership, conferring different rights in the handling of contracts. There are 12 category 1 members who are allowed in the bourse's ring, a 6- meter-wide (20-foot) trading pit in Leadenhall Street, about a 10-minute walk from the Bank of England.

It is London's last so-called open outcry trading floor and has its origins in the Jerusalem Coffee House in the financial district where metals traders would meet in the early 19th century. Merchants would draw a circle in the sawdust around which people would make their bids.

Brokers also trade through the bourse's Select electronic platform and by phone. Select accounted for 52 percent of volume and the ring 21 percent a year ago, LME data show.

Ordinary Shares
The exchange is owned by LME Holdings Ltd., which issues two share classes. There are 12.9 million ordinary shares, which confer ownership and traded at 4.925 pounds in July, according to data on the bourse's website. There are also 1.34 million B shares, which exchanged hands at 70 pounds in July. Neither shares trade on an exchange.

Owners of B shares get no dividend and have no right to the profits or assets of the company, according to the articles of association. In the event of a distribution of assets, they are entitled to get the nominal value of the capital paid up on each share. They can't attend company meetings unless changes to their rights are being considered. It is mandatory for four categories of membership to own the B shares.

"Metals trading continues to expand and new metals and products are growing the reach of the market," said John Meyer, a mining and metals analyst at Fairfax IS in London. "The LME is proven to be one of the, if not the, most resilient markets in the world in times of crisis. In 2008, investors kept funds with LME brokers rather than banks."

Asian Tin
The LME was founded in 1877 to feed industrial Britain's need for metals. Its benchmark contracts are three-month futures because that's how long it took in the days of steamships to get copper from Chile or tin from Southeast Asia.

The LME started trading steel futures in 2008 and expanded into molybdenum and cobalt in 2010, adding to eight contracts in non-ferrous metals and its LMEX index of six industrial metals. The bourse introduced so-called LMEminis in February, which are available through the Singapore Exchange.

"The sale of the LME is an opportunity for the shareholders to sell out based on current volume," said David Threlkeld, president of Resolved Inc., a commodities trading and hedging adviser in Scottsdale, Arizona. "Selling the LME at this point would be as smart as Glencore going public at the top."

To contact the reporter on this story: Agnieszka Troszkiewicz in London at atroszkiewic@bloomberg.net

Congressional stalemate puts federal disaster funds at risk

Posted: 26 Sep 2011 12:26 AM PDT

A congressional stalemate that could shut down the government this week threatens federal disaster relief for states already struggling to recover from one of Mother Nature's most calamitous years.

President Obama has declared a record 84 major disasters this year, with a new one Friday for summer flooding in Kansas. Ten have been billion-dollar disasters, the National Climatic Data Center says...

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Gold Market Update

Posted: 26 Sep 2011 12:03 AM PDT

France Bans Cash Sales of Gold/Silver Over $600

Posted: 25 Sep 2011 11:56 PM PDT

Tightening the Noose: France Bans Cash Sales of Gold/Silver Over $600
A couple of weeks ago our report that some Austrian banks had begun restricting the sale of gold and silver to 15,000 Euro (~$20,000 USD) reportedly because of money laundering issues was met with disbelief by many readers of financial news and information web sites. As we mentioned in that commentary, it is our view that governments, namely in Western nations, are making it more difficult for individuals to make gold purchases, as well as to do so anonymously.

It looks like this trend of restricting the peoples' ability to acquire assets of real monetary value is expanding. If a recent report from France is accurate, and based on the French governments official web site it looks like it is, then as of September 1, 2011, anyone attempting to sell or purchase ferrous or non-ferrous metals, which includes gold and silver, will be required to pay for their purchase via a credit card or bank wire transfer if it exceeds 450€ (~ $600 USD):

Here is the applicable French law via www.legifrance.gouv.fr and translated into English by Google Translate:
Article L112-6

Amended by Law n ° 2011-900 of July 29, 2011 – art. 51 (V)

I. Can be made in cash payment of a debt greater than an amount fixed by decree, taking into account the place of tax residence of the debtor and the professional purpose of the operation or not.

In addition a monthly fixed by decree, the payment of salaries and wages is subject to the prohibition contained in the preceding paragraph and shall be made by check or by transfer to a bank or postal account or account held by a payment institution.

Any transaction on the retail purchase of ferrous and non ferrous is made by crossed check, bank or postal transfer or by credit card, not the total amount of the transaction may not exceed a ceiling set by decree. Failure to comply with this requirement is punishable by a ticket for the fifth class.

II.-I Notwithstanding, the costs of the department conceded that exceed the sum of 450 euros must be paid by bank transfer.

III. The preceding provisions shall not apply:

a) For payments made by persons who are incapable of binding themselves by a check or other payment, as well as those who have no deposit account;

b) For payments made between individuals not acting for business purposes;

c) paying the expenses of the state and other public figures.

According to independent reports the law was passed to curb the illegal sale of stolen metals like copper, steel, etc. Given the rampant rise in thefts of these metals from telephone poles, construction sites and businesses here in the United States, we can certainly see this as a reasonable assessment for why the French passed this law.

However, the fact that no exception was made for gold and silver simply cannot be ignored. The new law effectively makes it illegal to purchase even a single Troy ounce of gold or around 18 ounces of silver in cash.

Looking at a single incident, for example the identification requirements in some major US cities like Houston, TX if you want to trade bullion, or the aforementioned restrictions in Austria, could be construed as coincidence or no big deal. But the most recent example in France suggests that what we have here is not a coincidence, but rather, a pattern. If there truly is a behind-the-scenes push to keep gold out of the hands of the people, then it would likely be done through indirect means and we commoners would be none the wiser.

How long before the US Congress, as a result of the rise in metals thefts here in the United States, uses this same excuse as a pretext to follow in the footsteps of the French?

Strike that question. That can't happen in America.

http://lewrockwell.com/slavo/slavo59.1.html

WATCH: Gold and Silver News 9.26.11

Posted: 25 Sep 2011 11:55 PM PDT

Gold and Silver news for 9.26.11.
The bloodbath continues, stay focused and stack away.

~TVR

Is China Business News following the gold issue through GATA?

Posted: 25 Sep 2011 11:53 PM PDT

The gold supply and prosperity

Posted: 25 Sep 2011 11:45 PM PDT

'Gold is the only money of ultimate redemption; the only kind of money that has no credit fiat in it; the only kind that is worth as much without its stamp as with it; the only kind that has ...

anyone found any platinum at a reasonable price?

Posted: 25 Sep 2011 11:40 PM PDT

I have never bought anywhere but at my local coin shop. I have cruised a few gold websites but no seems t have platinum . I would like to buy this afternoon if I can find some. I'm not interested in fractionals..Just 1 oz.

WATCH: Marc Faber “Gold oversold, Time to buy.”

Posted: 25 Sep 2011 11:15 PM PDT

From ZHedge:

Marc Faber in an 9.26.11 interview with CNBC, "Gold is quite oversold. I will consider buying gold over the next two days".

~TVR

Swiss Stock Exchange to launch gold currency

Posted: 25 Sep 2011 11:15 PM PDT

Market action at the end of last week confirmed that the US Federal Reserve has disappointed traders; although the Fed's announcement of Operation Twist had been expected by many analysts, the market ...

WATCH – The Hyper Report 9.26.11

Posted: 25 Sep 2011 11:14 PM PDT

In the he 9.26.11 Hyper Report: The Euro, Greece, The IMF, Mortgages, Gold, Silver and more.
Prepare accordingly.

~TVR
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