Gold World News Flash

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• Paper Money Is Not Wealth
• Eric Sprott - Silver Producers: A Call to Action
• Gold Seeker Closing Report: Gold and Silver End Near Unchanged
• Commodity Inflation And Spare Capacity: Food For Thought
• Gold shares, cheapest since 2002, said to be 'coiled spring' for rally
• Remember precious metals' fundamentals, Embry tells King World News
• Suppressing Reality
• Tens Of Millions Of American Families Are Living On The Edge Of Desperation – And The Economy Is About To Get A Whole Lot Worse
• Chris Martenson on exponentially rising debt and rapid depletion of resources
• What 'To The Moon' Will Look Like
• The Latest From Sprott
• Chris Martenson Lecture On Why The Next 20 Years Will Be Marked By The Collapse Of The Exponential Function
• Presenting John Paulson's Mea Culpa For Worst Year Ever
• Presenting John Paulson's Mea Culpa For Worst Year Ever
• John Paulson’s Fund Obscures ETF Flow Data
• LIKE A THIEF IN THE NIGHT
• The Silver Market Psychology & Inflation
• Why Politicians Are Good for Gold
• What “To The Moon” Will Look Like
• Black Friday MOB, EURO Zone & EURO COLLAPSE / WORLD WAR 3 Begins
• Gold Steady and Silver Down a Touch / First Day Notice Tomorrow
• Kerry Lutz Interview with Andy Hoffman 11-29-11
• MF Global: The Straw That Breaks The CRIMEX Back?
• Japanese Micro-Steps Toward The End Of An Era
• Gold Rose Today Closing at $1,713.40, Silver Fell 30.8c
• How Up and Down Markets Toy With Investor Emotions
• Where is Support for Gold and Silver Stocks?
• A Total Wipeout
• Gold Daily and Silver Weekly Charts - S&P Downgrades the Credit of Most Big US Banks After the Bell
• Financials Stumble Amid Average Volume Range Day

Paper Money Is Not Wealth Posted: 29 Nov 2011 04:56 PM PST by Bob Livingston Have you ever seen "old people" hold and fondle their paper money? They count it, hide it under the mattress and bury it for safekeeping. Remember my example of the power of inflation? I said that you could bury your paper money 40 miles deep in a sealed concrete vault, and it still could be inflated or devalued to nothing. There is no way to preserve your paper money. It is up to the money creators to not overprint. Here's how we are fooled: People equate fiat paper money like U.S. dollars with wealth. Only if paper money held its purchasing power could it be a store of value. Only then could you bury it and forget it. For now, the safest currencies are those tied to commodities, such as the Canadian dollar (CAD) or the Norwegian kroner (NOK). In addition to being commodity currencies, these countries are not reckless with their currencies and national resources. Most people do not understand currency gains (or losses). Right now, with the U.S. dollar and the U.S. economy in big trouble, there is not much risk to be in a foreign currency. We prefer the Canadian dollar, right after the Swiss franc. The U.S. dollar does rally from time to time, but the long-term trend is down. We must understand this in order to protect our savings and investments. The only thing that the U.S. government and the Federal Reserve can do under any pretense is to debase the currency. They do this by printing money or massive devaluation. It is not a solution, only a delay. Read More @ personalliberty.com

Eric Sprott - Silver Producers: A Call to Action Posted: 29 Nov 2011 04:39 PM PST Days ago KWN let readers globally know that billionaire Eric Sprott, Chairman of Sprott Asset Management, had informed King World News in an audio interview that he was writing a letter to silver producers requesting that they store their money in silver, rather than in cash at banks. Here is a portion of that letter from Eric Sprott to silver producers and below you can read the letter in its entirety, "If they were to reinvest all their earnings back into silver, it would shrink available 2011 investment supply by 82%... Silver miners need to acknowledge that investors buy their shares because they believe the price of silver is going higher. We certainly do, and we are extremely active in the silver equity space. We would never buy these stocks if we didn't. Nothing would please us more than to see these companies begin to hold a portion of their cash reserves in the very metal they produce. Silver is just another form of currency today, after all, and a superior one at that." This posting includes an audio/video/photo media file: Download Now

Gold Seeker Closing Report: Gold and Silver End Near Unchanged Posted: 29 Nov 2011 04:00 PM PST Gold fell $8.30 to $1703.40 in late Asian trade before it rose to see a $6.20 gain at $1717.90 in London and then fell back to $1706.35 by a little after 9AM EST, but it then rallied back higher for most of the rest of trade in New York and ended near its late session high of $1720.10 with a gain of 0.25%. Silver fell to as low as $31.49 in late Asian trade before it climbed to as high as $32.183 in late morning New York trade, but it then fell back off a bit in afternoon trade and ended with a loss of 0.62%.

Commodity Inflation And Spare Capacity: Food For Thought Posted: 29 Nov 2011 03:50 PM PST The '-flations' are as much part of the commonplace parlance for every sell-side strategist, talking-head, and gold-bug as dividend-stock, quality balance sheet, and long-time-horizon is for long-only managers. Whether deflation, stagflation, inflation, disinflation, or reflation, they all have their moments of sublime glory. Bank of America's Economics team have found some extremely timely 'inflation' signs in the food industry, where it is becoming, somewhat incredibly in this age of supposed frugality and deleveraging, cheaper to eat-out than to cook-at-home. This price disequilibrium has seen consumers respond accordingly; spending on food away from home has picked up while spending on food at home has slowed and also very notably households spending the marginal unit of 'time' working as opposed to 'eating' as economic frailties continue.   BAML- US Macro Watch: Food for thought   When it becomes frugal to eat out   One of the most basic tenets in economics is the law of demand; consumers will buy more of a good when its price decreases and less when its price increases. This is becoming increasingly evident in the food industry. It is becoming cheaper, on a relative basis, for consumers to dine out than to buy their own groceries and cook at home. Consumers have responded accordingly; spending on food away from home has picked up while spending on food at home has slowed.       Prices at the grocer rising faster than restaurants   Chart 1 tells a compelling tale. According to the Bureau of Labor Statistics (BLS), prices for food at home (grocers) are advancing over 6% per year. That is roughly two-and-a-half times faster than prices for food away from home (restaurants). While this data may not line-up with what you hear from the industry, our point here is more on direction of the series. Notice that food at home is more volatile than price movements in the food away from home category. Why the divergence? Grocers tend to be more sensitive to raw commodity prices. Recall the underlying premise of our inflation forecast: spare capacity, particularly in the labor market, will constrain inflation.   Restaurants offset commodity pressures through wages   Restaurants tend to have a stronger labor component in the end-cost of goods sold than grocers. With the youth unemployment rate at 24%, restaurants are better positioned to offset higher food prices by paying workers less. Moreover, for many workers in the restaurant industry customer tips comprise a major portion of earnings. For the average grocer, end consumer costs tend to be more sensitive to raw food prices. Workers in grocery stores are also more likely to be unionized, limiting the ability of grocers to offset higher food prices through wages.         Opportunity cost to go to the grocer is rising   One additional point to consider is the opportunity cost to households. In this weak economic environment, if afforded an extra hour of time, a household will be more likely to work in that hour than spend that time going to the grocery store and preparing food. Again, this implies a relative shift, substituting away from grocery stores into restaurants.   Spending up at restaurants, down at grocers   With prices at restaurants rising more slowly than grocers, consumers have responded in-kind. Chart 2 illustrates this relative consumption shift. The result is predictable but telling. As a share of total personal consumption expenditures, spending at restaurants has been rising steadily since mid-2009. For grocers, on the other hand, this share has been essentially flat.   We can only hope that the S.N.A.P. (food stamp program) will be accepted at Masa, Jean Georges, and Daniel very soon. Though with all the extra marginal hours we will be spending working, perhaps the marginal utility of food (or true consumption) will drop to zero?

Gold shares, cheapest since 2002, said to be 'coiled spring' for rally Posted: 29 Nov 2011 03:19 PM PST By Thomas Biesheuvel Bloomberg News Tuesday, November 29, 2011 http://www.bloomberg.com/news/2011-11-30/gold-shares-cheapest-since-2002... Gold mining stocks are trading at their cheapest level in at least nine years even as the industry's profits are estimated to almost double this year and bullion trades close to its historic high. The benchmark NYSE Arca Gold BUGS Index (HUI) that includes Barrick Gold Corp., Newmont Mining Corp., and AngloGold Ashanti Ltd. ended last week at 17 times earnings, the lowest since at least November 2002 and below a five-year average of 37 times. Investors sold equities across the board as Europe's debt crisis soured the corporate profit outlook, and they're ignoring analyst projections for bullion and gold producers. The gold index's 16 members will increase combined per-share earnings 94 percent this year, according to estimates compiled by Bloomberg. ... Dispatch continues below ... ADVERTISEMENT Be Part of a Chance to Discover Multi-Million-Ounce Gold and Silver Deposits in Canada Northaven Resources Corp. (TSX-V:NTV) is advancing five gold and silver projects in highly prospective and politically stable British Columbia, Canada. Check out the exploration program on our Allco gold/silver project : -- A large (13,000 hectare) property, covering more than 15 square kilometers of a regional mineralized trend just 3km from a recently announced 1.2-million-ounce gold and 15-million-ounce silver deposit. -- The property hosts historic high-grade silver workings and many mineral showings as well as former mines at the property's northern and southern boundaries. -- A deep-penetrating airborne geophysics survey has just been completed on the entire property and neighboring deposits and its results are eagerly awaited. To learn more about the Allco property or Northaven's other gold and silver projects, please visit: http://www.northavenresources.com Or call Northaven CEO Allen Leschert at 604-696-3600. "When you look back in history, you will say this was a buying opportunity," said John Wong, a portfolio manager at CQS Group's New City Investment Managers in London and lead manager of the $200 million Golden Prospect Precious Metals Ltd., a fund holding gold and silver stocks. "It's like a coiled spring." Gold equities have fallen 5.6 percent this year, heading for the first annual decline since 2008. Gold reached a record $1,921.15 on Sept. 6 and is set for an 11th annual gain. "The market doesn't trust big spikes," said Jon Bergtheil, an analyst at Citigroup. "People will wait to see if gold holds above $1,600 for a while." Gold averaged about $1,706 an ounce in the third quarter, 39 percent more than a year earlier, and is forecast to average $1,859 next year, according to the median estimate of 18 analysts compiled by Bloomberg. It closed Nov. 28 at $1,712. Hedge fund manager David Einhorn said Nov. 1 that a "substantial disconnect has developed between the price of gold and the mining companies." Einhorn's Greenlight Capital Re cut holdings of the commodity in the third quarter and moved funds into the Market Vectors Gold Miners ETF, which tries to replicate the Arca Gold Miners Index (GDM) of metal producers. Gold miners' earnings per share and per-share cash flow reached the highest levels in at least nine years during the third quarter, according to data compiled by Bloomberg. "When earnings are reported, the market will be all goggle-eyed about how much cash is flowing in to these companies and what their balance sheets look like," said Bergtheil. "You tend to get a response at that time." Gold equities have been dragged down as investors seek a haven from market turmoil stoked by the sovereign debt crisis. The MSCI All-Country World Index has fallen 12 percent this year while the Stoxx Europe 600 Index has sunk 16 percent. Barrick Gold, the world's biggest producer, has slipped 6.8 percent in 2011, even after posting record earnings in the third quarter. AngloGold Ashanti, Africa's biggest supplier, has slipped 10 percent, while Newmont Mining has advanced 6.2 percent. None of the members of the Gold BUGS Index have outperformed the metal this year. Investors have been increasing holdings in exchange-traded products physically backed by gold to bet on gains in prices for the precious metal, without accepting the potential negatives that come with holding company shares. "Investors are voting with their feet," said Ian Preston, a resources analyst with Goldman Sachs Australia Pty in Melbourne. "They can get all of the leverage they want out of going straight into an ETF without any of the operational risk, or political risks, or general risks associated with equities." Holdings in gold ETFs on Nov. 23 reached a record 2,350.8 metric tons, valued at $127.6 billion, according to data compiled by Bloomberg. Hedge funds and other speculators increased their net-long position, or bets on higher prices, for four weeks, the longest stretch since March, Commodity Futures Trading Commission data show. "Gold equities will come back," Norm Pitcher, chief operating officer of Vancouver-based Eldorado Gold Corp., said in an interview yesterday. "The one thing you don't have when you are buying an ETF is any upside to exploration, and I think the companies that have good exploration assets are the ones that will probably be valued a little higher." That attraction of ETFs over stocks may also fade when concerns ease that the European debt crisis will ravage corporate profits, said New City's Wong. "Gold mining shares are still equities, so they are determined by the equity market as a whole, not just gold," said Wong. "The performance of equities in a bear market is bad. Once there is some stability and people are prepared to take risks, I see that there will be a massive move." * * * Join GATA here: Vancouver Resource Investment Conference Sunday-Monday, January 22-23, 2012 Vancouver Convention Centre West Vancouver, British Columbia, Canada http://cambridgehouse.com/conference-details/vancouver-resource-investme... California Investment Conference Saturday-Sunday, February 11-12, 2012 Hyatt Grand Champions Resort Indian Wells, California, USA http://cambridgehouse.com/conference-details/california-investment-confe... Support GATA by purchasing a silver commemorative coin: https://www.amsterdamgold.eu/gata/index.asp?BiD=12 Or by purchasing a colorful GATA T-shirt: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: http://www.goldrush21.com/ Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT The United States Once Again Can Establish a Stable Dollar Worth Its Weight in Gold Lewis E. Lehrman, chairman of the Lehrman Institute, sponsor of The Gold Standard Now project, has released a plan to restore economic growth through a stable dollar. The plan, titled "The True Gold Standard: A Monetary Reform Plan Without Official Reserve Currencies," responds to the recurrent economic crises of the last century and outlines a detailed proposal for America's leadership on "how we get from here to there." That is, how we get from the present unstable paper dollar to a stable dollar as good as gold. James Grant, author and editor of Grant's Interest Rate Observer, says of the Lehrman plan: "If you have ever wondered how the world can get from here to there -- from the chaos of depreciating paper to a convertible currency worthy of our children and our grandchildren -- wonder no more. The answer, brilliantly expounded, is between these covers. America has long needed a modern Alexander Hamilton. In Lewis E. Lehrman the country has finally found him." To learn 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

Remember precious metals' fundamentals, Embry tells King World News Posted: 29 Nov 2011 02:54 PM PST 10:50p ET Tuesday, November 29, 2011 Dear Friend of GATA and Gold (and Silver): Sprott Asset Management's John Embry tells King World News tonight that he's trying to get investors to remember the fundamental factors favoring gold and silver, which is hard enough even before contemplating the washout in mining shares. But like GoldMoney's James Turk, Embry envisions silver's doubling rather quickly. An excerpt from his interview is posted at the King World News Internet site here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/11/29_E... Meanwhile, full audio of geopolitical analyst Jim Rickards' latest interview with King World News has been posted here: http://www.kingworldnews.com/kingworldnews/Broadcast/Entries/2011/11/29_... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT The United States Once Again Can Establish a Stable Dollar Worth Its Weight in Gold Lewis E. Lehrman, chairman of the Lehrman Institute, sponsor of The Gold Standard Now project, has released a plan to restore economic growth through a stable dollar. The plan, titled "The True Gold Standard: A Monetary Reform Plan Without Official Reserve Currencies," responds to the recurrent economic crises of the last century and outlines a detailed proposal for America's leadership on "how we get from here to there." That is, how we get from the present unstable paper dollar to a stable dollar as good as gold. James Grant, author and editor of Grant's Interest Rate Observer, says of the Lehrman plan: "If you have ever wondered how the world can get from here to there -- from the chaos of depreciating paper to a convertible currency worthy of our children and our grandchildren -- wonder no more. The answer, brilliantly expounded, is between these covers. America has long needed a modern Alexander Hamilton. In Lewis E. Lehrman the country has finally found him." To learn 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 Join GATA here: Vancouver Resource Investment Conference Sunday-Monday, January 22-23, 2012 Vancouver Convention Centre West Vancouver, British Columbia, Canada http://cambridgehouse.com/conference-details/vancouver-resource-investme... California Investment Conference Saturday-Sunday, February 11-12, 2012 Hyatt Grand Champions Resort Indian Wells, California, USA http://cambridgehouse.com/conference-details/california-investment-confe... Support GATA by purchasing a silver commemorative coin: https://www.amsterdamgold.eu/gata/index.asp?BiD=12 Or by purchasing a colorful GATA T-shirt: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: http://www.goldrush21.com/ Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT Be Part of a Chance to Discover Multi-Million-Ounce Gold and Silver Deposits in Canada Northaven Resources Corp. (TSX-V:NTV) is advancing five gold and silver projects in highly prospective and politically stable British Columbia, Canada. Check out the exploration program on our Allco gold/silver project : -- A large (13,000 hectare) property, covering more than 15 square kilometers of a regional mineralized trend just 3km from a recently announced 1.2-million-ounce gold and 15-million-ounce silver deposit. -- The property hosts historic high-grade silver workings and many mineral showings as well as former mines at the property's northern and southern boundaries. -- A deep-penetrating airborne geophysics survey has just been completed on the entire property and neighboring deposits and its results are eagerly awaited. To learn more about the Allco property or Northaven's other gold and silver projects, please visit: http://www.northavenresources.com Or call Northaven CEO Allen Leschert at 604-696-3600.

Suppressing Reality Posted: 29 Nov 2011 02:44 PM PST from WealthCycles: In our premium articles, we have written extensively on the topic of market manipulation (see The Strange Manifestations of Free Market Manipulation)…. While it is always tempting to "correct" the naturally efficient free market, the effort always backfires by displacing something else. It's like the old game of Whac-A-Mole, a game where whacking one mole only leads to more moles popping out. The government-engineered suppression of gold prices has long been thought the realm of tin-foil hatters by the mainstream media—but new evidence, and new doubt being cast on the Fed, has lent credence to the theory. With the latest loan data out from the Fed, and new news that former Treasury Secretary Hank Paulson actually gave hedge funds advance information on government bailouts, has cast a serious shadow on the veracity of government statements. A new interview with fund manager Marshall Auerback, in which he sees gold above $3,000, puts the suppression in easy-to-understand soundbites: Read More @ WealthCycles.com

Tens Of Millions Of American Families Are Living On The Edge Of Desperation – And The Economy Is About To Get A Whole Lot Worse Posted: 29 Nov 2011 02:41 PM PST from The Economic Collapse Blog: Have you ever been so poor that you had to live in your car? Have you ever been so low on funds that the only place you could afford to live was a rat-infested motel? Have you ever spent a night living in a tent city or sleeping in the streets? If not, you should consider yourself to be very fortunate. As the recent Black Friday madness demonstrated, there are still lots of Americans that are doing well enough to go on wild shopping sprees, but the reality is that there are also millions of American families that are falling through the "safety net" to a place of total desperation. In a previous article I talked about the fact that the U.S. Census Bureau recently announced that a higher percentage of Americans is living in extreme poverty than has ever been measured before. Not only that, 2.6 million more Americans fell into poverty last year. That was also a new all-time record. As you read this, one out of every seven Americans is on food stamps and one our of every four U.S. children is on food stamps. Tens of millions of American families are living on the edge of desperation. In many communities across the United States, there is so much despair in the air that it is almost tangible. When you look into the eyes of many Americans these days, it almost seems as if all the hope has been sucked right out of their hearts. Economic despair is at epidemic levels, and unfortunately the economy is about to get a whole lot worse. Read More @ TheEconomicCollapseBlog.com

Chris Martenson on exponentially rising debt and rapid depletion of resources Posted: 29 Nov 2011 02:35 PM PST 10:35p ET Tuesday, November 29, 2011 Dear Friend of GATA and Gold: Market analyst Chris Martenson made an absolutely brilliant and eloquent presentation to the Spanish Precious Metals Association's conference in Madrid on November 16, emphasizing the exponential growth of debt in Western economies amid a worsening depletion of crucial natural resources. GoldMoney's ever-adept video crew was there to capture it, and while it is an hour and 11 minutes long, there's not a wasted moment in it. You can watch it at the GoldMoney Internet site here: http://www.goldmoney.com/video/martenson-presentation.html?gmrefcode=gat... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT Prophecy Granted Landmark Chandgana Power Plant License Company Press Release Monday, November 21, 2011 VANCOUVER, British Columbia -- Prophecy Coal Corp. (TSX: PCY)(OTCQX: PRPCF)(Frankfurt: 1P2) announces that its wholly-owned Mongolian subsidiary, East Energy Development LLC, has received the license certificate from the Mongolian Energy Regulatory Authority to construct the 600-megawatt Chandgana power plant. This 600-mw thermal power plant license is the first of its size issued by the Mongolian government. To ensure strict compliance with Mongolian laws and regulations in obtaining this license, Prophecy retained Mongolian and international consultants over the past 18 months and spent much effort on community relations. Coal for the Chandgana mine-mouth power plant will be supplied from Prophecy's Chandgana Tal deposit, for which the company has already obtained a full mining license. Tal contains 141 million tonnes of measured coal and is located just 9 kilometers north of Prophecy's Chandgana Khavtgai project, a deposit with more than 1 billion tonnes of measured and indicated coal. Chandgana is 60 km from Underkhann city (East Energy System) and 150 km from Baganuur city (Central Energy System). Construction of transmission lines linking the two cities through Chandgana is seen as a top priority for a much-improved and more efficient national Mongolian energy system. John Lee, chairman and CEO of Prophecy Coal, says: "Prophecy has distinguished itself as the premier candidate to build the next Mongolian thermal power plant. There is an understanding among all stakeholders that Mongolia, being one of the world's fastest-growing economies, needs additional power. With the International Monetary Fund projecting a deficit for Mongolia of more than 600 mw by 2016, this need has become urgent and can no longer be delayed." For Prophecy Coal's full press release, complete with maps, please visit: http://www.prophecycoal.com/news_2011_nov21_prophecy_granted_landmark_ch... Join GATA here: Vancouver Resource Investment Conference Sunday-Monday, January 22-23, 2012 Vancouver Convention Centre West Vancouver, British Columbia, Canada http://cambridgehouse.com/conference-details/vancouver-resource-investme... California Investment Conference Saturday-Sunday, February 11-12, 2012 Hyatt Grand Champions Resort Indian Wells, California, USA http://cambridgehouse.com/conference-details/california-investment-confe... 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: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: http://www.goldrush21.com/ Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT Sona Discovers Potential High-Grade Gold Mineralization at Blackdome in British Columbia -- 13.6g over 1.5 Meters From a Company Press Release November 22, 2011 VANCOUVER, British Columbia -- With its latest surface diamond drilling program at its 100-percent-owned, formerly producing Blackdome gold mine in southern British Columbia, Sona Resources Corp. has discovered a potentially high-grade gold-mineralized area, with one hole intersecting 13.6 grams of gold in 1.5 meters of core drilling. "We intersected a promising new mineralized zone, and we feel optimistic about the assay results," says Sona's president and CEO, John P. Thompson. "We have undertaken an aggressive exploration program that has tested a number of target zones. Our discovery of this new gold-bearing structure is significant, and it represents a positive development for the company." Sona aims to bring its permitted Blackdome mill back into production over the next year and a half, at a rate of 200 tonnes per day, with feed from the formerly producing Blackdome mine and the nearby Elizabeth gold deposit property. A positive preliminary economic assessment by Micon International Ltd., based on a gold price of $950 per ounce over eight years, has estimated a cash cost of $208 per tonne milled, or $686 per gold ounce recovered. For the company's complete press release, please visit: http://www.sonaresources.com/_resources/news/SONA_NR18_2011-opt.pdf

What 'To The Moon' Will Look Like Posted: 29 Nov 2011 02:33 PM PST This may sound sensationalistic, but I think the odds are very high that, on average, gold producers will sell in the $200 range before this bull market is over. With most of them trading between $20 and $40, the returns could be ... Read More...

The Latest From Sprott Posted: 29 Nov 2011 02:14 PM PST from TFMetalsReport.com: I receive these updates by email, whenever Sprott Asset Management issues them. If you'd like to receive them, too, just click the link below. http://www.industrymailout.com/Industry/Subscribe.aspx?m=22439 Silver Producers: A Call to Action by Eric Sprott and David Baker As we approach the end of 2011, the silver spot price has admittedly endured a tougher road than we would have expected. And let's be honest – what investment firm on earth has pounded the table on silver harder than we have? Read More @ TFMetalsReport.com

Chris Martenson Lecture On Why The Next 20 Years Will Be Marked By The Collapse Of The Exponential Function Posted: 29 Nov 2011 02:12 PM PST In this video courtesy of GoldMoney, Chris Martenson, economic analyst at chrismartenson.com and author of 'The Crash Course', explains why he thinks that the coming 20 years are going to look completely unlike the last 20 years. In his presentation he focuses on the so-called three "Es": Economy, Energy and Environment. He argues that at this point in time it is no longer possible to view either one of those topics separately from one another. Since all our money is loaned onto existence, our economy has to grow exponentially. Martenson proves this point empirically by showing a 99.9% fit of the actual growth curve of the last 40 years to an exponential curve. If we wanted to continue on this path, our debt load would have to double again over the next 10 years. By continually increasing our debt relative to GDP we are making the assumption that our future will always be wealthier than our past. He believes that this assumption is flawed and that the debt loads are already unmanageable. Martenson explains how exponential growth works and why it is so scary that our economy is based on it. In an example he illustrates how unimaginably fast things speed up towards the end of an exponential curve. He shows that an exponential chart can be found in every one of the three "E's" for instance in GDP growth, oil production, water use or species extinction. Due to the natural limitations on resources, Martenson comes to the conclusion that we are facing a serious energy crisis. This energy predicament is namely that the quantity of oil as well as the quality of oil are in decline. He shows that oil discoveries peaked in 1964 and oil production peaked 40 years later. Martenson also shows how our return on invested energy is rapidly declining – the "cheap and easy" oil fields have already been exploited. In 1930 the energy return for oil was 100:1 or greater. Today it is already down to 3:1 and newer technologies such as corn-based ethanol only provide a 1.5:1 return. Martenson predicts that the time in between oil shocks will get shorter and shorter and that oil prices will go much higher. Not only oil but also other natural resources are being rapidly used up as well. At the current projected pace of use, known reserves for many metals and minerals will be gone within the next 10 to 20 years. The energy needed to get these non-renewable resources out of the ground is growing exponentially. So we live in a world that must grow, but can't grow and is subject to depletion. The conclusion out of all this is that our money system is poorly designed and that we need to rethink how we do things as quickly as possible. After finishing his presentation Chris Martenson answers questions regarding a rise in efficiency, alternative technologies and oil prices. He also responds to questions regarding electricity, shale gas, gold, silver, platinum, palladium, and uranium and the race for global resources. This video was recorded on November 16 at the Gold & Silver Meeting 2011 in Madrid.

Presenting John Paulson's Mea Culpa For Worst Year Ever Posted: 29 Nov 2011 01:50 PM PST It is a bad day for people named Paulson. We are not sure if John Paulson, who has not updated the HSBC hedge fund performance tracker through November although was quite happy to do so in October when the market could only rip higher, is more apologetic in his latest letter for the fact that his sold gold holdings to buy even more Bank of America stock, which as everyone knows is about to have a 4 handle, or because somehow his gold fund has managed to return just 1%, even as the shiny object itself has a solid 20% YTD return. Frankly we don't care; LPs in the fund, however, should... although as Paulson has repeatedly stated he has barely seen any redemption requests despite his abysmal performance, so at the end of the day it appears that everyone has gotten what they want. The bulk of the attached Paulson Q3 letter, procured courtesy of ValueWalk, says nothing of note, except to regurgitate some repeatedly stated facts about gold stocks being cheap, and to note that Martin Feldstein has joined the fund as an advisor side by side such "luminaries" as Alan Greenspan, Ed Altman and Chris Thornberg. What is notable, is that Paulson has presented investors with a company matrix of five large banks (their identities are quite simply once one looks at the fund's most recent 13F) which he believes will generates ludicrous potential returns. The last time he did this was for Bank of America. Our advice: short these with leverage. Full letter below:

Presenting John Paulson's Mea Culpa For Worst Year Ever Posted: 29 Nov 2011 01:50 PM PST It is a bad day for people named Paulson. We are not sure if John Paulson, who has not updated the HSBC hedge fund performance tracker through November although was quite happy to do so in October when the market could only rip higher, is more apologetic in his latest letter for the fact that his sold gold holdings to buy even more Bank of America stock, which as everyone knows is about to have a 4 handle, or because somehow his gold fund has managed to return just 1%, even as the shiny object itself has a solid 20% YTD return. Frankly we don't care; LPs in the fund, however, should... although as Paulson has repeatedly stated he has barely seen any redemption requests despite his abysmal performance, so at the end of the day it appears that everyone has gotten what they want. The bulk of the attached Paulson Q3 letter, procured courtesy of ValueWalk, says nothing of note, except to regurgitate some repeatedly stated facts about gold stocks being cheap, and to note that Martin Feldstein has joined the fund as an advisor side by side such "luminaries" as Alan Greenspan, Ed Altman and Chris Thornberg. What is notable, is that Paulson has presented investors with a company matrix of five large banks (their identities are quite simply once one looks at the fund's most recent 13F) which he believes will generates ludicrous potential returns. The last time he did this was for Bank of America. Our advice: short these with leverage. Full letter below:

John Paulson’s Fund Obscures ETF Flow Data Posted: 29 Nov 2011 01:49 PM PST Absent the weekly COT report for gold and silver, the array of exchange-traded funds available on the market acts as an excellent source of money flow data for both silver and gold. While the media tends to focus on total assets, exchange-traded funds also release the quantity of gold and silver attributed to individual exchange-traded funds. Recently, gold and silver ETF flows have been obscured by a rift in the market. John Paulson, who earned headlines after betting big on a housing crash, has since seen his funds significantly underperform the market. Combine underperformance with growing fears about the global economy, and you have a perfect storm for hedge fund outflows. Analysts on Wall Street have picked through Paulson's fund holdings, looking for opportunities to buy assets as his hedge fund unloads on the market. ETF Flows Gold and silver ETFs almost perfectly follow gold and silver prices in the short-term due to algorithmic arbitrage between exch...

LIKE A THIEF IN THE NIGHT Posted: 29 Nov 2011 01:17 PM PST Please note Jesse's last sentence. You will not be given notice. Obama will pull an FDR. Your wealth will evaporate overnight. Don't think it can't happen. Every major bank in the world is insolvent. Gold Daily and Silver Weekly Charts – S&P Downgrades the Credit of Most Big US Banks After the Bell Intraday commentary [...]

The Silver Market Psychology & Inflation Posted: 29 Nov 2011 01:09 PM PST from SilverGuru:

Why Politicians Are Good for Gold Posted: 29 Nov 2011 01:00 PM PST After a long and lengthening political debacle on both sides of the Atlantic, the developed world remains embedded in a crisis that the political systems are unable, or unwilling, to resolve despite all the hopeful talks. The leaders of the developed world are capable, competent men who have what it takes to surmount the debt crises that are consuming confidence day by day. So why don't they?

What “To The Moon” Will Look Like Posted: 29 Nov 2011 12:49 PM PST http://www.caseyresearch.com/editorial.php?page=articles/what-moon-will-look&ppref=TBP422ED1111D This may sound sensationalistic, but I think the odds are very high that, on average, gold producers will sell in the $200 range before this bull market is over. With most of them trading between $20 and $40, the returns could be tremendous. And while the typical junior won't reach the same price level, [...]

Black Friday MOB, EURO Zone & EURO COLLAPSE / WORLD WAR 3 Begins Posted: 29 Nov 2011 12:43 PM PST from Fabian4Liberty: Part 1: Part 2:

Gold Steady and Silver Down a Touch / First Day Notice Tomorrow Posted: 29 Nov 2011 12:36 PM PST by Harvey Organ: Good evening Ladies and Gentlemen: Today the gold market advanced marginally as we head into first day notice tomorrow. Gold rose by $4.20 to $1715.00. Silver on the other hand felt pressure by the naked bankers as it fell by 33 cents to $31.83. Markets around the world were up a bit as the risk trade was on and thus, gold up, dollar down,euro up, and stock market up. Let us head over to the comex and see how things are shaping up for tomorrow: The total gold comex open interest fell by a massive 12,293 contracts to 426,180 from yesterday's level of 438,474. With gold rising the only explanation that makes sense is the fact that longs refuse to play anymore due to the MF Global mess with the commingling of client funds with dealer funds. Customers refused to put up the entire purchase of gold and silver contracts fearing confiscation by the dealers. The CME is slowly seeing their business deteriorate. The front options delivery month of November is now off the board. Read More @ HarveyOrgan.Blogspot.com

Kerry Lutz Interview with Andy Hoffman 11-29-11 Posted: 29 Nov 2011 12:29 PM PST from The Financial Survival Network: Andy Hoffman a/k/a Ranting Andy joins us to discuss the breakdown of fiat money, the Western Banking Cartel and perhaps Western Civilization as we know it (One of our favorite topics). While Andy doesn't think it will go that far, he does believe that you need to be prepared by having your wealth in items that not even and elite banker or reckless politician can debase. And you can guess what that means, precious metals, gold and silver, the only money that doesn't represent someone else's debt. Andy is marketing director of Miles Franklin (www.MilesFranklin.com) a long established reputable bullion dealer that is known for always getting you the goods. But rather than his employment dictating his beliefs, Andy's long term confidence in metals–he's been buying them for over a decade–led him to his current career. And Andy is bright and very versed on the important issues of our day. Click Here to Listen to the Interview This posting includes an audio/video/photo media file: Download Now

MF Global: The Straw That Breaks The CRIMEX Back? Posted: 29 Nov 2011 12:27 PM PST Bill Murphy commented this afternoon in his Midas Report on these silly Precious Metals Markets: A weaker dollar is usually given as THE reason for strength in commodity markets. Today it is given for early softness. Makes no sense at all. With the DOW so much higher, the dollar weaker, and commodity markets higher, gold and silver should have followed through on the upside much better than they did. Why not?… *The Gold Cartel capped the precious metals rally yesterday and was there again at the same levels. *That said, it appears they were covering their positions extensively before the capping started once again. On yesterday's surge the gold open interest went down 12,293 contracts to 426,181. The silver open interest dropped 5135 contracts to 99,056. Specs are getting out of long positions before tomorrow's first notice day for December rather than rolling over their positions. *Given the general news background, which is so gold friendly, this is a bit bizarre. Then again, there is the MF Global issue. Who wants to play in a casino that openly robs you and their regulators do nothing about it? A number of us thought December could be quite the explosive month. The MF Global nightmare defused that possibility for sure. The open interest in both gold and silver has really tanked. If all that is the case, then the potential for price explosions has grown substantially and still might be right around the corner … once the first notice day selling concludes. It all fits. The fundamentals are super bullish, the specs have fled the futures market on the long side, sentiment is TERRIBLE, and the gold/silver share investors are as demoralized as any time in the past decade.On that sort of note, James Mc… Small spec shorts gone wild Bill, Lost in the U.S. Thanksgiving holiday shuffle was another HUGE jump in the OI by the small spec gold shorts. They amazingly piled on another 12,993 short contracts as of the November 22nd report. Coincidentally (or not) the large commercial shorts reduced their short OI by a similar 12,246 contracts. This is very peculiar, and I can't ever recall such intense shorting of gold by (alleged) small spec traders. Since last Tuesday was nearing the bottom of the op. ex. gold raid they may be getting set up to get creamed this time around. If they manage to pull off another Hail Mary trade like the last time I'd definitely say there's something fishy going on. The next few days up to, and after FND may be their last chance to escape with their hides. The small spec silver shorts also added a rather large 1,732 contracts. Keep in mind both of the additional gold and silver shorting was largely done AFTER the CME went back to full margins on all contracts. I guess the little guys are feeling flush and lucky after their last round of windfall trading profits. Hey, baby needs a new pair of shoes for Christmas. Either that or JPM Has found a new home for the ... "missing" MF client money. How bizarre would that be, stealing client's margin funds to use to go short against them? James Mc ??? Yesterday both the AM and PM Fixes were the same at $1714. Today they were both $1717. Gold ended higher and silver lower in a very choppy trading session. In a blog post on Friday, November 18, 2011 I commented: "DO NOT discount that the fallout from the MF Global fleecing of customer accounts is playing a very big part in the drying up of global liquidity. This MF Global fiasco is going to prove to be a long and pervasive story. Confidence in the "system" stands to take a huge hit because of this bankruptcy, and the SEC and CFTCs negligence in allowing it to occur." Understand this: The MF Global bankruptcy is no small tremor in the ongoing Global Financial Crisis...IT IS A SEISMIC EVENT!  Ultimately, "this crime", is going to lead to the complete unraveling of the CRIMEX and it's foundation of fraud.  History will not be kind to MF Global and it's Goldman Sachs connected CEO John Corzine.  Greek Debt Default may be the end of the beginning of the Global Financial Crisis, MF GLOBAL will be recognized as the beginning of the end of the Global Financial Crisis.  2012 WILL NOT BE PRETTY. MF GLOBAL EXPLAINED ...a layman's explanation of the MF Global collapse by the producers of the "Silver Bears"... No Laws Were Broken By Greg Hunter's USAWAtchdog.com Last week, I wrote a piece called "False Narrative." I was stunned by a comment from a guy named Jim that said, "It amazes me that you maintain the narrative of the "guilt" of private business that asked for consideration from Congress and the president and it was granted. Nobody has gone to jail because no laws were broken." This is the most false of the false narratives. The 2008 meltdown is 70 times bigger than the S&L crisis of the 1980's and early 1990's. Back then, more than 1,000 financial elites were convicted of felonies. According to Professor William Black, the reason why we have "recurrent intensifying crises . . . is these epidemics of fraud from the C-Street—from the CEOs and CFOs." Professor Black holds duel PhD's in economics and law, but he is not just some run-of-the-mill academic. Professor Black is also a former bank regulator who spearheaded the cleanup of the S&L crisis. In a speech Black gave last week, he said, "In the Savings and Loans crisis, the inevitable National Commission said that fraud was invariably present at the typical large failure. In the Enron era, always frauds from the very top of the organization, and in this crisis the frauds came from the very top of the organization again. But what's different in this crisis? In this crisis, the same agency that I worked with that made over 10,000 criminal referrals in a tinier crisis made zero criminal referrals. They got rid of the entire function. And so there are zero convictions of anybody in the elite ranks of Wall Street. And if they can defraud us with impunity they will cause crisis after crisis and they will produce maximum inequality. . . . And that's why we have a crisis and it came from the very top of these organizations, and it went through—as the FHFA said in its complaint—the largest banks in the world were endemically fraudulent. It is not a few rotten apples. It is an orchard of one percenters who are rotten to the core." (Click here to read his complete speech.) Don't believe the professor, then how about the "maestro" Alan Greenspan. The former Fed Chief admitted the system was fraudulent and needed to be cleaned up last November. He said, "If you cannot trust your counter-parties it won't work and . . . it didn't." He was sitting on set with Ben Bernanke when he said it. Look at the video below, and watch Mr. Bernanke's face when Greenspan dishes the dirt. Look at the latest blowup with MF Global. There is more than $1 billion of segregated customer funds missing and not a single criminal charge. Does anyone think Jon Corzine is going to get prosecuted? I'll be shocked if he is because he has friends in high places including the White House. Just because nobody has gone to jail doesn't mean everything is going to be ok and we all get a free pass. According to Karl Denninger at Market-ticker.org, the markets will be the ultimate regulator. Denninger wrote last week, "Without enforcement of the law — swift and certain — there is no deterrent against this behavior. There has been no enforcement and there is no indication that this will change. It will take just one — or maybe two — more events like MF Global and Greek CDS "determinations" before the entire market — all of it — goes "no bid" as participants simply stuff their hands in their pockets and say "screw this." It's coming folks, and I guarantee you this: Whatever your "nightmare" scenario is for such an event, it's not bearish enough." (Click here for the complete Denninger post. It's really good!) You cannot have a thriving economy that is shrouded in fraud and mistrust. Crimes continue to go unpunished, and mistrust is growing. No bailout, no matter how big, will ever fix that. You Cannot Build a Financial System on Rumors and Lies Submitted by Phoenix Capital Research, via ZeroHedge This is not a monetary Crisis; it is a Crisis of values and morals. It is a Crisis caused by the notion that you can lie about virtually everything pertaining to a business deal (the quality of the assets, who owns them, whether they're even legitimate, etc) and get away with it. To review how we go into this mess, Wall Street and other industries lobbied Congress to loosen regulations. However, the secondary nature of those lobbying efforts was it trained Congress to see Wall Street as the hand that feeds, thereby making it unlikely for Congress to prosecute or pursue any criminal activity on the part of the bankers. Take away consequence and rules and you have anarchy. And that's virtually what we had in the Financial System leading up to the Crisis. Looking back on some of the more glaring situations (AIG, Goldman Sachs, etc) it's simply amazing the whole mess didn't blow up sooner. The Federal Reserve and regulators then blew a one in 100 years opportunity to reform the system. We're now finding out that instead of doing anything positive, Bernanke literally gave away TRILLIONS of Dollars to the banks. In simple terms, the Fed engaged in the exact same business practices that blew up the mortgage lenders: giving money away without inquiring as to the borrowers real financial position or needs. By doing this, the Fed spread the lies (and toxic debts) onto the public's balance sheet, thereby compromising the Republic's creditworthiness. In plain terms, Bernanke extended the Big Lie: that those working in the financial sector are the smartest, most capable people on earth and that they know what they're doing (even though they almost blew up the system). Which brings us to today. The whole system is now built on lies. The lie that banks are solvent. The lie that the Federal Reserve actually cares about regulating the financial system. The lie that crimes will be punished. The lie that Congress will reform Wall Street. The lie that we'll get "change" at the ballot box. And on and on. You cannot build a financial system on lies. It simply doesn't work. All it does is breed distrust and resentment. And as any businessperson can tell you, without trust business cannot work. Just When You Think It CAN'T Get Uglier Out There... Posted by Dave in Denver at The Golden Truth Before I get started on what I had intended to post, I want to present two items of acute interest. First, I hope everyone - Democrat or Republican - is aware of just how tight Jon Corine is with President Obama and the Obama White House insiders: LINK Not that it will matter for the Presidential race because the leading Republican candidates are thoroughly unelectable, but I sincerely hope that the conservative media makes Obama wear Jon Corzine the way that Republicans made Michael Dukakis wear Willy Horton in the 1988 Presidential race vs. George H. Bush (everyone remember that?). I am sure that we are not seeing immediat investigative actions being taken on Corzine because of his inside connections to Obama. He's not even scheduled to appear before Congress until next month. If this were a drug-dealer busted in Harlem, this case would already be before the magistrate and the perp would be waiting for his trial in jail. Second, many of you have read this by now, but here's a textbook example of the ways in which the insider elite and those connected to the insiders are raping our system wholesale and stealing what they can, while they can: "How Paulson Gave Hedge Funds Advance Word" LINK The article goes on to describe how Henry Paulson - then Secretary of the Treasury under George W Bush - met with several large hedge fund managers - many of them Henry Paulson cronies from Goldman Sachs - and revealed the Government plans for bailing out Fannie Mae and Freddie Mac - several months before the bailout actually occurred. Some bird-brain professors are quoted in the article as saying that this is not inside information, but that is total horse shit. If I had possession of that information when Paulson doled it out to his buddies, I would have gone out bought up every single discounted Fannie Mae and Freddie Mac bond I could find and I would have leveraged those purchases with as much money as I could borrow. I'm sure the trading records of those at the Paulson insider trading pow-wow will never be investigated. What Paulson did was unequivovally illegal and he won't be prosecuted for it. Hell, Bush signed an executive order that gave all of his cabinet members a perpertual get of jail free card. Obama was supposed to repeal that EO but never did. This shit just keeps piling higher and higher...quite frankly, I have become unusually doomish and gloomish in my outlook for what is coming our way. And the outright fraud, corruption, raping and pillaging and theft that is actually being enabled by our Government is an obvious signal to me that very bad things are headed our way... In fact, I'm so disgusted by the information and implications of the two above articles that I'm going to abbreviate my original post. In short, the market yesterday was all giddy about the Black Friday sales estimates and the new home sales. However, everyone should know that when the real numbers are tallied, there will be substantial downward revisions of the Black Friday initial sales estimates. In fact, one of the widely reported sales reports is based on measured foot traffic at malls not based on anything concrete, like money going into the cash register. For those of you who didn't see it, here's a fantastic summary why the Black Friday initial sales numbers are nonsense: LINK Moreover, it was pointed out today that every year more and more stores participate in Black Friday. In fact, many of them open up either at midnight or before midnight. This makes year over year same-store-sales metrics - which are the relevant numbers if you want to see real growth - impossible. Furthermore, it is highly likely that the pervasiveness of sales deals and give-aways has "pulled" a substantial portion of holiday budget spending into Black Friday and the ensuing weekend, which means that it is likely that overall sales for the entire holiday period will be anemic at best. After all, we have seen that real monthly income for workers has been declining and consumers are cutting back on credit...who is left to spend? Regarding my gloomy outlook - look at it this way: this country is not capable of dealing with the economic and standard of living plunge that would occur IF the Government were to implement the type of policies and spending cuts required to fix the system. Just think about the implications for joblessness and the massive increase in poverty that would occur if the Government were cut itself down by the at least the 50% required to start balancing real spending. This country would look like a 3rd world country on steroids. So that being the case, the people on top and inside know this so they are looting what they can, while they can. And no one is around to stop this because the people who were voted into office to enforce the laws - of the people, by the people and for the people - are the same ones who are engaged in the mass looting of our system. Your best shot at seeing what "the other side" of what is coming will look like is to move as much of your wealth as you can into physical gold and silver - NOT GLD, CEF or PHYS (unless you have enough money to take delivery of 400 oz bars and a place to store them safely). This includes liquidating as many of your retirement fund accounts as you can (obviously if you have a 401k and currently work at your 401k provider, you can't liquidate that). Beyond that, sailing away from this country on a boat, the way my buddy did who introduced me to the precious metals 10 years ago, is your best option. SocGen Sees $600 Billion QE3 Starting In March 2012 Sending Gold Up Between $1900 And $8500/Oz From ZeroHedge SocGen has released its much anticipated Multi Asset Portfolio Scenario/Strategy guide titled simply enough "Patience: bad news will become good news" where, as the insightful can guess, the French bank makes the simple case that the worse things get, the stronger the response by global central banks will be. Here is the key quote for those worried that : "A major liquidity crisis should not occur this time, as we think we are on the eve of major QE in the UK, US and (a bit) later on in the EZ." We don't disagree and if there is anything that can send BAC higher it will be the announcement of QE3. Of course, BAC will first drop to a $2-3 handle so question is who has the balance sheet to hold on to the falling knife. The next question is "How big will QE3 be"? Well, according to SocGen, the Fed will preannounce it in the January 2012 FOMC statement, the monetization will last from March 2012 until the end of the year, and will buy a total of $600 billion. We believe the actual LSAP total (not to be confused with the "sterilized" QE3 known as Operation Twist) will be well greater, probably in the $1.5 trillion range as the Fed will finally say "enough" to piecemeal solutions. As to what to do, besides going long some financial stock and hoping it is not the one that is allowed to fail, SocGen has some simple advice: "Buy gold ahead of QE3 as money creation has a strong impact on prices" - in other words just as we suggested yesterday courtesy of the Don Coxe correlation chart. Why gold and not BAC? Because, "Gold is highly sensitive to US QE, as every dollar of QE goes into M0, triggering the debasement of the USD. Gold = $ 8500/Oz: to catch up with the increase in the monetary base since 1920 (as it did in the early 80s). Gold = $1900/Oz: to close the gap with the monetary base increase since July 2007(QE1+QE2)." So go long a bank that may well go bankrupt and return nothing before it at best doubles, or go long a real asset, which will always have value and may quadruple in short notice? The answer seems simple to us... From SocGen: A combination of weak Q1 2012 GDP and softening inflation could push the Fed to another round of monetary expansion. SG economists look for a two-step easing process: 1) In January 2012, a major announcement with the Fed promising to keep rates at zero until unemployment falls below 7.5% or inflation moves above 3% on a sustained basis. 2) In March 2012, the announcement of another round of QE. We expect the next round of QE to be concentrated on MBS purchases and be worth about $600bn over six to eight months. This would increase the Fed's securities portfolio from currently $2.65trn to $3.25trn by the end of 2012.sustained basis. Currency Wars: The Anglo-American Century and Why the Financial Engineers Hate Gold and Silver From Jesse's Café Américain 'Nominal GDP targeting' is a way of raising the Fed's inflation target without admitting to it explicitly. Nominal GDP means that one can meet their growth target simply by inflating the money supply to make up the difference between 'real growth' and 'headline growth.' NGDP targeting is so obvious and clumsy that I doubt that the Fed will try and hide their future monetization of the debt under such a small fig leaf, as Jim Rickards suggests. I think the monetization is already occurring in the Eurodollar markets, and an ongoing stealth bailout of European debt, in order to save the big money center banks at home. John Williams: Hyperinflation Warning, Preserve Value with Gold Source: JT Long of The Gold Report (11/28/11) Among the specters lurking in ShadowStats.com's Editor John Williams' gloomy outlook for the U.S. are the demise of the dollar, hyperinflation and the ongoing lack of political will to take sound corrective measures. Still, as he tells The Gold Report in this exclusive interview, investors have options. Williams contends that turning to gold, silver and strong foreign currencies would protect wealth and position savvy investors to take advantage of extraordinary opportunities likely to flow out of the turmoil ahead. The Gold Report: When we talked in May, you predicted that hyperinflation could be a reality as soon as 2014, something you addressed at length in your Hyperinflation Special Report. Have six months of euro debt crises, Middle East revolts and U.S. Treasuries' downgrading altered your outlook? John Williams: Not a bit. We still seem to be moving down that road to a relatively near-term break toward hyperinflation. The most important thing that's happened since we last talked was the global response to the U.S. legislators' negotiations over the debt-limit ceiling and the deficit reduction problems at that time. Clearly, no one controlling the White House or Congress was serious about addressing the nation's long-term solvency issues. That sparked a panic selloff on the dollar against currencies such as the Swiss fran

Japanese Micro-Steps Toward The End Of An Era Posted: 29 Nov 2011 11:45 AM PST By Wolf Richter   www.testosteronepit.com "Japan's economy is likely to continue to face a severe situation for the time being, especially with respect to exports," said Masaaki Shirakawa, the Governor of the Bank of Japan, when he was talking to business executives in Nagoya (Japan Today). He blamed the European debt crisis and the strong yen. Whatever the causes—Eurozone chaos, dollar devaluation, yuan peg, etc.—the strong yen puts pressure on Japanese exporters to sacrifice profits overseas or lose market share. Consequently, exporters have redoubled their efforts to relocate production to plants outside Japan. Honda and Toyota announced that they would switch production of certain vehicles from plants in Japan to their plants in Alabama for export to South Korea. Honda announced that it would shift production of big motorcycles from Japan to Thailand. The list goes on. Japan Inc. is adjusting to the strong yen. Not surprisingly, trade deficits are making a regular appearance. The October details were ugly. Exports fell 3.7% from a year earlier, in part due to sluggish IT demand. Exports to China skidded 7.7%. Imports were up 17.9%. It was the fifth month of trade deficits this year (graph), and Export Nation Extraordinaire will likely end up with a trade deficit for 2011. The end of an era. So, October unemployment jumped to 4.5% from 4.1%. By US standards, it's still low; birthrates have been declining for decades, and every year, fewer and fewer young people enter the workforce as more and more people retire at the top end. Another ratio that looks outright glorious compared to the jobs nightmare in the US: there were 67 job offers to every 100 job hunters. So unemployment will not be a huge issue. What will be a huge issue is having these fewer workers service the exploding gross national debt that has reached the astronomical level of 230% of GDP (Greece's may hit 160% soon). Repaying it is impossible. And at some point, the house of cards will come down, either through massive inflation, devaluation, or selective default. In the interim, the BoJ tries to keep yields near zero to essentially eliminate interest expense as a budget item. A matter of financial survival. The BoJ has no other option. If short-term rates rose from near zero to, say, 3% on this kind of indebtedness, the government would not be able to make interest payments for long. Selective default would be one of the options. A scary thought. A thought that probably every Japanese adult has had. It's a fact of life. So, Japanese household spending has been dropping for eight consecutive months, according to the Ministry of Internal Affairs (Japan Today). And the big consumption tax hike that is making its way through the political system isn't exactly an uplifting thought either. To counter all this, the BoJ increased its asset buying program by ¥5 trillion to ¥55 trillion ($724 billion). The additional cash will be plowed into Japanese government bonds in an endless strategy of printing money and buying assets to prop up the house of cards. And it's working: 10-year yields are around 1% despite the dance of downgrades that won't stop at the current AA- rating. At these yields, practically no one outside Japan wants to buy this crappy debt—95% is internally funded. The BoJ's other bets have been REITs and EFTs. Since December 15, 2010, it intervened in the open markets whenever the Nikkei dropped significantly during the morning session. Currently, purchases are capped at ¥1.4 trillion ($18.4 billion). For greater effect, they're published on the BoJ website. But it has been a losing trade. Despite these purchases that were supposed to prop up the markets, the Nikkei is down 22% from its February high this year (and down 78% from its all-time high in 1989). "This is not what a central bank should be doing," said Masaaki Kanno, BoJ's former chief foreign-exchange dealer (Bloomberg). "The program started in an emergency, and it's been snowballing." Meanwhile, life goes on in Japan with its own vibrancy, innovation, renewals ... and concerns, the latest being colon cancer. On Monday, the National Cancer Center released the results of a long-term study that confirmed that people who ate large quantities of red meat (beef and pork) were at elevated risk of colon cancer. Nothing new. But the quantities were stunning: for example, men who ate a daily average of 100 grams or more of red meat (measured before cooking) were 44% more likely to get colon cancer. 100 grams per day! That's 3.5 ounces before cooking. Maybe four bites after cooking. The new prime minister and his loose-lipped cabinet, however, are tangled up in other challenges.... Minister Calls Tsunami Victims 'Idiots' Wolf Richter   www.testosteronepit.com

Gold Rose Today Closing at $1,713.40, Silver Fell 30.8c Posted: 29 Nov 2011 11:13 AM PST Gold Price Close Today : 1713.40 Change : 2.60 or 0.2% Silver Price Close Today : 3185.3 Change : -30.8 cents or -1.0% Gold Silver Ratio Today : 53.791 Change : 0.596 or 1.1% Silver Gold Ratio Today : 0.01859 Change : -0.000208 or -1.1% Platinum Price Close Today : 1537.00 Change : -1.20 or -0.1% Palladium Price Close Today : 588.75 Change : 9.55 or 1.6% S&P 500 : 1,195.19 Change : 2.64 or 0.2% Dow In GOLD$ : $139.42 Change : $ 0.20 or 0.1% Dow in GOLD oz : 6.744 Change : 0.010 or 0.1% Dow in SILVER oz : 362.78 Change : 4.49 or 1.3% Dow Industrial : 11,555.63 Change : 32.62 or 0.3% US Dollar Index : 79.05 Change : -0.252 or -0.3% Sorry, I am not convinced that the rallies for the GOLD PRICE and the SILVER PRICE off Friday's bottom have any lasting power. Here's why: Yesterday the high-low range for the GOLD PRICE was $1,719.88 and $1,703.49 (for silver, 3231c and 3156c). Today the range was $1,719.83 and $1,703.47 (3216.5c and 3147c). The GOLD PRICE today rose $2.60 to close at $1,713.40, while silver fell 30.8c (after rising 114.7c yesterday) to 3185.3c. A mixed close always gives me the nervous fantods. Range for GOLD those two days was virtually identical, leading to the conclusion that a solid wall of resistance awaits at $1,720. Monday and Tuesday gold double-topped at that line. A failure to break through tomorrow would be fatal to this fragile rally, and gold looks stuck, spinning wheels in the mud. HOWEVER, look at a longer term chart, and you will see that last week's fall caught on the uptrend line from the $1,535 (September) low. Long as that holds (now about $1,700), gold's correction is passed, but if it breaks, nothing good follows. 50 DMA is 1702.11, so momentum is barely, temporarily up, but the 20 DMA stands at a lofty $1,742.60, a long ways above. The SILVER PRICE chart looks the same, only less so. Instead of an even double top Monday and Tuesday, silver topped higher on Monday. Still, the boundaries are plain. Top of the range is 3231, bottom at 3156c. Break up or down thru those levels will carry silver further in the same direction. If it breaks upward, it would climb to 3340c. So far in this latest decline, the longer term chart alloweth me to say nothing much. Looks like it has further to fall, but a rise above 3400c would change that. I have no idea when, but sometime soon, probably before year end, y'all will get a spectacular chance to buy silver. The GOLD/SILVER RATIO rose from 53.195 yesterday to 53.791 today. This does not touch the high (56.56) of the correction since September (rising, for the ratio, remember, when silver and gold are falling) but it is pushing toward it. That implies more work downside for both metals, especially silver. Y'all, I had to drive up to Sevierville yesterday, 5 hours away, and spent the night up there. Leaving the motel this morning, I made the mistake of picking up, then reading a USA Today. Right now, I am suffering from such severe brain poisoning that I doubt I can rub two vowels together and make sense, but I'm going to try. My brain will be spitting and puking for a week trying to get that offal out of its system. US DOLLAR INDEX closed today at 79.053, down 25.2 basis points. The "down" isn't as important as the level, 79.00, important to morale. Once the dollar index bursts thru 79.84, it will blast off. Must not drop lower than 77.50. Moving higher, watch for it. Euro looks as sick as ever. Closed unchanged today at 1.3313, but last two days has shown no more than a dead cat bounce. Might get a rally here to 1.3500, but soon, yes, soon will come 1.2000. Japanese yen was indeed wounded by the Nice Government Men's last manipulation -- "Steering", they call it in German" -- and fell all last week. Today it rose a stingy 0.11% to 128.35c/Y100 (Y77.91/$1). BoJ bureaucrats aren't out of the woods yet. Yen needs to drop below 127.5c (Y78.43/$1) to give them any relief. STOCKS jumped big time yesterday (Dow rose 291.23), but today improved little on that performance. Now the five day chart has a mess on it, with Monday at 11,550 - 11,450 looking something like a shoulder, a straight down drop for Wednesday and Friday with a low at 11,250, then a straight up rise yesterday. That might be something like an upside-down head and shoulders that yields a target of 11,850. Might. Dow today closed up 32.62 (0.28%) at 11,555.63. S&P500 rose 2.65 (0.22% to 1,195.19). Longer term chart shows only that the Dow bounced up off the lower Jaw of Death's bottom jaw, and has crossed above its 50 day moving average (11,540), which might turn momentum upward. Overall, this is a decaying market. Buzzards are circling. Combination of government interference and decades of mal-investment induced -- no, seduced -- by inflation simply refuse to let the economy heal itself. We are tempted to assign the motive here to wrecking -- deliberate sabotage by the parasites in charge -- but 'twould always be dangerous to pick that cause above plain vanilla stupidity born of ideology and lack of work experience. Nothing teaches you how an economy works like scouring toilets, flipping hamburgers, washing cars, or any of the understory jobs that keep the economy running. One wonders whether Bernard O'Bama or Ben the Bernancubus every have held a real job, where you had to work and produce or be fired -- and never mind all the other assorted goofs, miscreants, criminals, and ne'er-do-wells in Washington. Can't y'all just hear my brain spluttering and spitting, trying to get the poison of USA Today and CNN out of its inwards? Yes, my wife turned on the TV in the room. 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 bubble has burst, primary trend down. WARNING AND DISCLAIMER. 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 short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures. NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps. NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced. NOR do I recommend buying gold and silver on margin or with debt. What DO I recommend? Physical gold and silver coins and bars in your own hands. One final warning: NEVER insert a 747 Jumbo Jet up your nose.

How Up and Down Markets Toy With Investor Emotions Posted: 29 Nov 2011 11:07 AM PST "I want it all, I want it all, I want it all, and I want it now." — Lyrics from a popular Queen song…and the prevailing political "wisdom" of our time. Stocks up. Gold up. And oil back within a few cents of the $100 mark. The world economy is, apparently, in full swing again. Until tomorrow, that is. Or next week. Who knows? Investors have been suffering through a dazzling display of mixed signals lately. One minute they think the market's got the hots for them…the next minute it's throwing cold water in their face. It comes on strong…then plays coy. Shows some leg…then slaps a cheek. Last week investors got whacked. This week they're all doe-eyed again. They think they're in love. Most folk don't like all the games. "A simple 'Yes' or 'No' would do us just fine," they say. "Think of all the time and money a straight-forward answer would save if the market would just pick a path and stick to it!" Ah…but where's the fun in that, Fellow Reckoner? Where are the lessons along the way…the travails of the journey…the hardships to look back on through the rose-colored glasses of retrospect…the glory days to romanticize at some distant date in a far off future? More importantly, what would we have to write about all day if everyone already knew the headlines of tomorrow's papers? Who'd bother asking any questions? Not us. Fortunately, that's not the way markets work. The relationship is far more complex than that. Last week, for instance, it looked as if the whole thing had gone sour. Stocks plunged during the shortened trading week. News came out that Germany couldn't sell its debt. Not Greece or Italy or any of the other fiscal misfits. Germany! An auction of 10-year Bunds fell apart at the seams. "If Germany can't sell its debt," cried investors in a panic, "what hope does the rest of Europe have? Portugal…Spain…the rest of the PIIGS…they'll have to go bust! Then what!?" [Editor's Note: As a quick aside, Eric Fry recently discussed these ongoing problems in the Eurozone, specifically Germany's failed bond auction, on Capital Account with Lauren Lyster. As always, his comments were incredibly insightful. Check it out here: Well, what a difference a good tryptophan-induced food coma can make. Investors awoke from their long weekend slumber having seemingly forgotten last week's little lover's tiff. Romance is in the air again. German Chancellor Angela Merkel and French President Nicolas Sarkozy are playing footsies under the Euro table, promising to come to a solution that satisfies everyone's deepest desires. In the US, too, investors have been quick to forget past transgressions. And quick to forget their own situation. Shoppers, for instance, forgot they had no money and hit the retail stores last week with all the gusto of a drunk falling off a wagon. Black Friday sales were up. Wages, savings and disposable incomes were not. Neither were employment levels. How long can out-of-work consumers continue buying Chinese knickknacks with money they don't have? Not long would be our first guess. And our second, too. Of course, it's hard for the average man to know where he stands today. He follows his heart and his emotions. And both tell him to look to his leaders. He has heard that his country is broke…but he sees his leaders spending…and spending more than ever. He has a suspicion that debt might be a problem…but he is told that deficits don't matter. He knows the money has run out…but he remembers hearing something about a helicopter. So he sticks his head out the window and looks to the sky. Then, when no money falls from the heavens, he heads to the mall just the same. "Capitalism is supposed to be a system of profit and loss," writes Jeffrey Tucker, publisher at Laissez-Faire Books, in today's Whiskey & Gunpowder, "but in recent years, central bankers and central planners seem to have forgotten the part about losses. They push and pull every lever on the control board to try to make losses for the big players go away, which can be a bit like trying to stop a receding tide." Governmental "Too Big To Fail" mollycoddling has rendered a generation virtually incapable of dealing with losses. In short, the average man on the street today lives in a world largely sheltered from the consequences of actions, both his and his government's. (For now.) His leaders promise him creation without destruction, knowledge without lessons, wisdom without experience…all funded with EZ credit, made available until the day he dies. Amen. How is this man prepared for a catastrophe, you ask? He isn't. How can he conceive of a day when effect again meets with cause? He can't. What will happen when the unthinkable becomes the inevitable? Don't ask. Occasionally, however, the nourishing process of creative destruction, of unfettered capitalism, is "allowed" to do its work. It can be painful in the short run, yes, but the eventual result is a stronger, more vibrant future…one deserved of those brave enough to resist the urge to meddle. Joel Bowman for The Daily Reckoning How Up and Down Markets Toy With Investor Emotions originally appeared in the Daily Reckoning. The Daily Reckoning provides over 400,000 readers economic news, market analysis, and contrarian investment ideas.

Where is Support for Gold and Silver Stocks? Posted: 29 Nov 2011 10:01 AM PST It has been a tough year for the mining stocks. The large stocks have moved back and forth in a range from support to resistance while the mid tiers and juniors have really struggled especially in recent months. With Europe seemingly on the brink and most markets turning down, it is an opportune time to examine the technical support of the various gold and silver equity indices. The longer the large cap equities maintain support, the more internal strength they build in preparation for a breakout in early 2012. In turn, such action would greatly help the juniors and non producers who have had a difficult year. We start with our flagship market GDX, the ETF for large unhedged gold producers. Since June, GDX has made slightly higher lows. Not bad considering the S&P 500, emerging market and commodity stocks all made news in that period. GDX continues to hold its 600-day moving average which was key resistance in early 2009 but support in early 2010. The market has support f...

A Total Wipeout Posted: 29 Nov 2011 09:32 AM PST November 29, 2011 [LIST] [*]Lehman 2008, American Airlines 2011: Seeing the inevitable from six months out... [*]S&P adds 40 points in two days: Marc Faber on how long the rally can last [*]Housing still stuck in a funk, but little-known indicator stops flashing red for a double dip [*]Nouriel Roubini misfires in a new Twitter war over gold [*]The rising cost of Christmas (but not the “core” measure)... Reader sees only two possibilities behind the derivatives bubble... What the heck is an “Income SAFE IOU”?... and more! [/LIST] And then there were none. With a Chapter 11 filing by American Airlines parent AMR Corp. this morning, every major U.S. airline has had a date with a bankruptcy judge since the terrorist attack on the World Trade Towers on Sept. 11, 2001. Operations will continue as is. Like the other carriers that went before it, the filing will give AMR the vaunted “breathing room” to keep the lights on w...

Gold Daily and Silver Weekly Charts - S&P Downgrades the Credit of Most Big US Banks After the Bell Posted: 29 Nov 2011 08:43 AM PST This posting includes an audio/video/photo media file: Download Now

Financials Stumble Amid Average Volume Range Day Posted: 29 Nov 2011 08:33 AM PST Bank Of America and Morgan Stanley closed today down around 7% from the 0931ET tick yesterday with BofA managing to defend the $5 Maginot Line once again - though closing almost at their lows. Tech and Financials were the worst sectors of the day (and the only sectors with negative performance) as Energy outperformed dragged by a war-premium-driven Oil price that crossed $100 intraday but ended just shy of it (up 2.5% from its intraday lows). After some early vol, FX markets trod water post the European close, practically unchanged on the day (and DXY -0.7% on the week) as equity markets once again outperformed credit in their illusory manner (though IG and HY did rally some on the day). Correlations continue to deteriorate across a broad basket of risk assets as TSY yields oscillated up and then down and then up into the close but it was Oil and AUDJPY's trend up that supported ES more than anything today. A glance at the performance of the major financials from right after the open yesterday shows that BAC and MS have been picked-on, JPM and GS are grouped, and WFC and Amex are in line with the broad financials ETF. Citi is outperforming. UPDATE: The S&P downgrade after-hours of the major financials is dragging ES lower and more in line with medium-term CONTEXT (see below). BAC lost $5 momentarily ES (the e-mini S&P futures contract) remains considerably above a medium-term calibrated CONTEXT (broad risk basket charted above) but on the day (the below chart - recalibrated for very recent price action), equities appeared to see through the strength in oil and were unable to keep pace with what CONTEXT thought was fair today. As we entered the last half hour, CONTEXT began to lose ground as TSYs rallied. At times such as this when correlations are lower across assets, the debt-equity framework provides a little more color and equities were well above credit's move on the day. HYG outperformed HY spreads and IG outperformed HY on the day. The lack of HY strength on a positive equity day does not provide much support for risk appetite. Stocks, much like in Europe this morning, stayed rich to credit all day. Copper and Oil were the story of the day though it seemed with the latter especially hot as Iran tensions rise. The drop in the USD this week is much more than matched by Gold and Silver which are up around 2% on the week. All-in-all, a very sideways non-event day in the US which saw correlations drop across asset classes, and once again risk in general un-supportive of equity's strength from Friday lunchtime. Medium-term CONTEXT, we suspect stil provides the footprint for some reality this week and credit's view of the S&P 500 cash index is still around 1164.   Charts: Bloomberg

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