Gold World News Flash |
- Golds Appeal "Undiminished" as China Blocks High-Yield Savings…
- SELL YOUR MOMS SILVER AND INVEST IN ZIMBABWE CURRENCY
- Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Over 1% and 3% on the Week
- By the Numbers for the Week Ending January 13
- Friday the 13th Credit Meltdown: Nightly News
- The Inexplicable American Consumer Takes A Breath
- Eric Sprott Calls For A Silver Cartel?
- The Real Dark Horse – S&P's Mass Downgrade FAQ May Have Just Hobbled The European Sovereign Debt Market
- Bam! Bam! Bam! Huge Financial Bombs Just Got Dropped All Over Europe
- France Credit Rating Cut Puts Eurozone Bail-Out Fund At Risk
- Gold Bugs, Stop Laughing!
- Chinese gold bugs take the lead
- Are The Middle East Wars Really About Forcing the World Into Dollars and Private Central Banking?
- Now They Tell Us
- The Real Dark Horse - S&P's Mass Downgrade FAQ May Have Just Hobbled The European Sovereign Debt Market
- The Gold Price Has Most Likely Bottomed Working Through Two Resistance Levels up $14.50 for the Week to Close at $1,616.10
- The Daily Market Report
- Investing in the Gold Bull Market Like Jesse Livermore
- Rob Kirby: U.S. rigs bond market with derivatives
- Faber's Latest Rant On Global Monetization Wars
- Jim Rogers: US Govt to ‘Juice Up’ Economy in Election Year
- Charles Krauthammer: Ron Paul's achievement
- Stock Futures Close Almost Green Even As Protection Costs Jump
- Money Printing: The Ugly Truth Behind the “Good News”
- Who Really Owns Your Gold Stocks?
- Money Printing: The Ugly Truth Behind the “Good News”
- Gold Daily and Silver Weekly Charts
- BIGGEST PRICK IN AMERICA
- 2008 Chart Comparison.
| Golds Appeal "Undiminished" as China Blocks High-Yield Savings… Posted: 13 Jan 2012 06:09 PM PST Bullion Vault
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| SELL YOUR MOMS SILVER AND INVEST IN ZIMBABWE CURRENCY Posted: 13 Jan 2012 05:24 PM PST [Ed. Note: The king of satire Bill Joe is back, so let's start the weekend off with a little levity. Apparently his mom got taken for a ride by the silver fetish nuts, so Billy Joe is selling her silver to move into a rock solid cash alternative. Enjoy.] from houseofthemoon:
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| Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Over 1% and 3% on the Week Posted: 13 Jan 2012 04:00 PM PST Gold fell to as low as $1625.27 by about 10:30AM EST before it rebounded midday, but it still ended with a loss of 0.67%. Silver slipped to as low as $29.42 before it also bounced back higher, but it still ended with a loss of 1.63%.
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| By the Numbers for the Week Ending January 13 Posted: 13 Jan 2012 03:22 PM PST HOUSTON -- Just below is this week's closing table followed by the CFTC disaggregated commitments of traders (DCOT) recap table for the week ending January 13, 2012.
Vultures, (Got Gold Report Subscribers) please note that updates to our linked technical charts, including our comments about the COT reports and the week's technical changes, should be completed by sometime Monday evening. We are planning a full Got Gold Report for this weekend, which should also be delivered to members by Monday evening. As a reminder, the linked charts for gold, silver, mining shares indexes and important ratios are located in the subscriber pages. In addition Vultures have access anytime to all 35 of our Vulture Bargain (VB) and Vulture Bargain Candidates of Interest (VBCI) tracking charts – the small resource-related companies that we attempt to game here at Got Gold Report. Look for new commentary often as we are making frequent notations in the tracking charts during this fantastic negative liquidity aftermath and post tax loss selling superb bargain hunting environment. Remember that the linked charts on the subscriber pages are always the first place to look for new commentary at GGR. In the future we intend to rely more on the charts to communicate, especially when it comes to our own trades. Continued… Gold and Silver Disaggregated COT Report (DCOT) In the DCOT table below a net short position shows as a negative figure in red. A net long position shows in black. In the Change column, a negative number indicates either an increase to an existing net short position or a reduction of a net long position. A black figure in the Change column indicates an increase to an existing long position or a reduction of an existing net short position. The way to think of it is that black figures in the Change column are traders getting "longer" and red figures are traders getting less long or shorter. All of the trader's positions are calculated net of spreading contracts as of the Tuesday disaggregated COT report.
*** We will have more in the linked technical charts for Vultures by Monday evening.***
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| Friday the 13th Credit Meltdown: Nightly News Posted: 13 Jan 2012 01:31 PM PST from InfoWars.com:
Tonight's Friday, January 13, 2012 edition of the Infowars Nightly News features an interview with Peter Schiff, investor and economic advisor to Ron Paul. Schiff gives his forecast for 2012, with an eye on crashing economies and the fresh credit downgrades for nine EU countries, new theaters of war and the impact of Ron Paul's presidential campaign. The Ron Paul campaign continues to gain steam, increasingly emerging as an undeniable contender for the GOP nomination. In South Carolina, considered too socially conservative for Paul to contest, he is rising in polls, now surging past Rick Santorum into the top tier and approaching Romney and Gingrich with the primary just around the corner. On the economic front, France and eight other EU nations were hit with an S&P downgrade today, and others are expected to follow, according to reports. Meanwhile, 'loan sharking' firms are targeting students with an "alternative" to traditional student loans, under terms that offer an outrageous 4000% interest rate. Factory workers in China are again threatening mass suicide over inadequate pay and a failure to honor severance terms for workers who've refused to meet the harsh demands at an XBox 360 production facility that has already seen many suicides from its workers.
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| The Inexplicable American Consumer Takes A Breath Posted: 13 Jan 2012 01:06 PM PST Wolf Richter www.testosteronepit.com Consumer optimism has been rising from the horrid multi-year lows in August and has reached the highest levels since, well, May. It whipped hope into a froth. Rising confidence would pump up consumer spending, which would pump up everything else. But the inexplicable American consumer, the toughest creature out there that no one has been able to subdue yet, had other plans. The Thomson Reuters/University of Michigan consumer sentiment hit 74.0 today, up from 69.9 in December, up for the fifth month in a row since the August lows. Similarly, the Conference Board Consumer Confidence Index (December 27) rose to 64.5, a big jump from the multi-year low of 44.5 in August. And Gallop's Economic Confidence Index (January 10) rose to -27 from its low of -54 in August. Consumer confidence is an ugly story. The Conference Board Index peaked at around 140 during the period of 1999 to 2001. Back then, it was fun being a consumer. Everyone had jobs, money markets actually made money, most yields were higher than inflation, stocks were shooting up, and even when they were crashing, everyone knew they'd reverse soon and make new highs. Then consumers discovered reality. Confidence began to unravel with sharp drops from 2001 to 2003, followed by mild upswings from 2003 to 2007, and a collapse by early 2009, when it dipped into the 20s. Since then, it has been rising, reaching the 70s in early 2011. But over the summer, it collapsed again to 44.5. August was a horrid month for confidence, and yet, the inexplicable American consumer pulled out a stack of credit cards and went shopping ... though real income (adjusted for inflation) continued its morose decade-long decline—that it parallels the decline in consumer confidence over time is probably not a coincidence. The shopping spree lasted through Thanksgiving. In December, plot twist. The trend reversed. Though consumer confidence shot up, the toughest creature out there took a deep breath. Retails sales ex-autos declined from November by 0.2%. Sales of electronics dropped by 3.9%, online sales edged down 0.4%, and sales in malls were down 0.8%. Including autos, which had a good month, sales rose only 0.1%. Out the window are the projections for a strong end of the holiday season. And it could be the beginning of another downdraft. Gallup sheds some light on this from a different angle. With a poll of open-ended questions, it tried to determine what worried Americans most about the national economy. Top three: "Jobs/unemployment" 26%, "National debt/Federal budget deficit" 16%, and "Continuing economic decline/Economic instability" 10%. Jobs, still. Despite ceaseless rhetoric from the White House about the millions of jobs that it had created somewhere, the job market has improved only slightly. The BLS's Employment Population ratio, which measures the percentage of people age 16 and older who have jobs, is the least corruptible employment number the government makes available. At 58.5%, it's only a fraction above the 58.1% from August, which was the lowest reading since 1983, and it's far below its peak of 64.7% in April 2000. In California, the numbers are similar. Peak employment occurred in January 2008, according to the BLS, when 17,023,322 people were working. The trough occurred in August 2011—yup, just five months ago—when only 15,830,729 people were working. However, the unemployment rate has been improving for a year. The difference: statistical adjustments. Not jobs created. For more on the debacle of declining incomes and disappearing jobs, read.... The Shriveling Middle Class in California. But White House rhetoric works: 34% of the respondent in the Thomson Reuters consumer sentiment survey had heard about the improving jobs situation. That's up from 21% in December, and a record in the history of the index. But rhetoric alone can't make up for a tough job market and falling real wages—and falling real wages are now part of the official White House dogma, according to a White House paper. But please don't tell the rank and file! Read it quietly.... When The White House Touts Falling Wages.
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| Eric Sprott Calls For A Silver Cartel? Posted: 13 Jan 2012 12:28 PM PST |
| Posted: 13 Jan 2012 12:26 PM PST from ZeroHedge:
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| Bam! Bam! Bam! Huge Financial Bombs Just Got Dropped All Over Europe Posted: 13 Jan 2012 12:24 PM PST from The Economic Collapse Blog:
The European debt crisis has just gone to an entirely new level. Just when it seemed like things may be stabilizing somewhat, we get news of huge financial bombs being dropped all over Europe. Very shortly after U.S. financial markets closed on Friday, S&P announced credit downgrades for nine European nations. This included both France and Austria losing their cherished AAA credit ratings. When the credit rating of a country gets slashed, that is a signal to investors that they should start demanding higher interest rates when they invest in the debt of that nation. Over the past year it has become significantly more expensive for many European nations to borrow money, and these new credit downgrades certainly are certainly not going to help matters. Quite a few financially troubled nations in Europe are very dependent on the ability to borrow huge piles of cheap money, and as debt becomes more expensive that is going to push many of them over the edge. Yesterday I wrote about 22 signs that we are on the verge of a devastating global recession, and unfortunately that list just got a whole lot longer. Over the past several months we have seen quite a few credit downgrades all over Europe, but we have never seen anything quite like what S&P just did. Standard & Poor's unleashed a barrage of credit downgrades on Friday…. Read More @ TheEconomicCollapseBlog.com
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| France Credit Rating Cut Puts Eurozone Bail-Out Fund At Risk Posted: 13 Jan 2012 12:18 PM PST The €440bn (£365bn) eurozone bail-out fund faced fresh threats last night after France, its second-largest contributor, was stripped of its AAA credit rating for the first time. by Louise Armitstead, Alistair Osborne and Amy Wilson, Telegraph.co.uk:
The downgrades, officially released after the US markets closed, capped another chaotic day for the eurozone, which was already reeling from the collapse of Greek debt restructuring talks. The French downgrade casts a menacing shadow over Nicolas Sarkozy, the French president, who faces an election in April, as well as the French economy and its banking sector. It also lands a body-blow to the eurozone's financial rescue mechanisms, starting with the European Financial Stability Facility (EFSF).
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| Posted: 13 Jan 2012 12:14 PM PST from WealthWire.com:
But if you already own physical bullion – or you're about to consider it – spare a thought for everyone else. Because pointing and laughing at the misfortune of others is an ugly habit. It only makes us "gold bugs" more boring at parties as well. A little sympathy, and a stab at empathy too, could go a long way to redeeming us socially. And it would be far better than taking a pratfall of our own, you'll agree. Crowing about being so right, so early is understandable, of course. Hitting a 22-year low in July 1999, the price of investment gold has since risen sharply – pretty much year after year – against the Euro, Yen and Sterling, as well as every other currency you can name. Silver bullion has done better still over the last decade – that decade straddling both the Tech Stock Crash and its offspring, the Cheap-Money Bubble, sired by meek academics wielding godlike powers at the big central banks. The permanent emergency following the inevitable blow-up has only accelerated gold's outperformance against pretty much every other financial asset you can name, too.
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| Chinese gold bugs take the lead Posted: 13 Jan 2012 12:08 PM PST By Jack Farchy http://www.ft.com/intl/cms/s/0/c9fed38a-3dcc-11e1-91f3-00144feabdc0.html Did China just overtake India as the world's largest gold consumer? Little more than a year ago it would have been almost laughable to ask that question. In 2010 India's gold consumption was a full 46 per cent -- or 275 tonnes -- higher than China's, according to data from consultants GFMS published in the World Gold Council's quarterly reports. Even three months ago it would have been a stretch. In the first nine months of 2011, Indian gold demand totalled 743 tonnes, compared to 612 tonnes for China. But data released in the past few days suggests that China may have closed the gold gap, inching ahead of India in terms of overall gold demand in 2011. ... Dispatch continues below ... ADVERTISEMENT Be Part of a Chance to Discover Northaven Resources Corp. 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Some of us had predicted this, but the data are sketchy, questionable, and incomplete, so it remains a hypothesis at this stage. GFMS is releasing updated -- but not final -- 2011 data on Tuesday, while the WGC should publish fourth-quarter numbers in mid-February. Nonetheless, at least one senior gold trader I have spoken to believes that China did indeed consume more gold than India last year. That conclusion implies an enormous divergence in gold buying in the two countries in the fourth quarter. And indeed, initial data and anecdotal reports from traders support that picture. Chinese gold imports from Hong Kong -- which in past years have accounted for about half of the country's total imports -- have soared to unprecedented levels. In October and November, China imported 189 tonnes of the precious metal from Hong Kong. Add to that China's domestic production, which runs at a rate of about 90 tonnes a quarter, and even without including any buying in December or any imports from sources other than Hong Kong, Chinese demand in Q4 would stand at a minimum of 279 tonnes. The reason for the spike in Chinese imports in recent months, traders say, is that throughout the supply chain the Chinese gold industry is aggressively building inventory ahead of Lunar New Year, after experience in 2011 when the country ran short. The effect is truly stunning: The 189 tonnes of imports in October and November compares with total imports for the whole of 2009 of just 45 tonnes. Indian demand, on the other hand, collapsed in the fourth quarter as a slide in the value of the rupee made gold much more expensive for Indian buyers, already wounded by the slowing domestic economy. The president of the Bombay Bullion Association told Reuters that Indian gold imports in the fourth quarter of 2011 tumbled by more than 50 per cent to 125 tonnes. Since India has almost no domestic production, that number, if correct, is also India's overall gold demand in Q4. Put all the numbers together, and they imply that full-year Chinese demand in 2011 was at least 891 tonnes (and probably a good deal more), while Indian demand was just 868 tonnes. Bingo! China wins. Now for the caveats. Most importantly, some analysts are sceptical of the Chinese import data. Perhaps the gold is being re-exported (illegally) to Vietnam, they say, perhaps it is the Chinese central bank buying, or perhaps the data are just wrong. Secondly, there is scepticism about the Indian import data. While all agree Indian demand was tepid in the fourth quarter, not all believe there was such a dramatic decline. We shall know for sure only when more accurate data come out in the next couple of months. Regardless, though, one thing is sure: It is hard to overstate the significance of the increase in Chinese gold demand. Join GATA here: Vancouver Resource Investment Conference http://cambridgehouse.com/conference-details/vancouver-resource-investme... California Investment Conference 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: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Golden Phoenix Receives Inferred Gold Resource Estimate Company Press Release Golden Phoenix Minerals Inc. (OTC: GPXM) reports that on behalf of Golden Phoenix Panama S.A., the joint venture entity that owns and operates the Santa Rosa gold mine in Panama, it has received from SRK Consulting (U.S.) an initial resource estimate for Mina Santa Rosa. The Santa Rosa project is a volcanic-hosted epithermal gold-silver deposit previously operated as an open pit-heap leach operation. Production ceased in 1999 in part because of low gold prices. SRK Consulting reports an in-situ inferred resource at the former Santa Rosa and ADLM pits totaling 23.1 million metric tonnes at 0.90 grams/tonne gold, for a contained 669,000 ounces of gold at a 0.30 g/t gold cutoff. The resource also contains an average grade of 2.87 g/t silver for a contained 2.1 million ounces of silver. John Bolanos, Golden Phoenix's vice president of exploration, remarks: "In addition to SRK's inferred resource estimate of 669,000 contained ounces of For the company's full statement, including a table detailing the resources at Santa Rose, please visit: http://goldenphoenix.us/press-release/golden-phoenix-receives-initial-ni...
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| Are The Middle East Wars Really About Forcing the World Into Dollars and Private Central Banking? Posted: 13 Jan 2012 11:54 AM PST The Middle Eastern and North African wars – planned 20 years ago – don't necessarily have much to do with fighting terrorism. See this, this and this. They are, in reality, about oil. And protecting Israel (and read the section entitled "Securing the Realm" here). But as AFP reports today, there is another major motivation for the expanding wars:
Why is the U.S. targeting Iran's central bank? Well, multi-billionaire Hugo Salinas Price told King World News:
As I noted in August:
Alex Newman wrote in November:
A reader comments:
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| Posted: 13 Jan 2012 11:13 AM PST January 13, 2012 [LIST] [*]A Friday the 13th edition of The 5: Fed follies, inexplicable market movements, a fashion designer’s gold bar... [*]Shocking words we’d never expect to see in The New York Times... alas, five years too late [*]Chris Mayer on why we’re likely in for another year of $100-plus oil [*]“High-performance mobile computing” from the seat of a Lamborghini... and other firsthand observations from our team at the Consumer Electronics Show (CES)... [*]Lawmaker hoisted on his own petard... readers fancy themselves armchair generals... and more! [/LIST] We had to wait five years. But it turns out our suspicion that the Federal Reserve is clueless, at best, is true. We know because we read it in The New York Times. Welcome to a Friday the 13th edition of The 5... where if things aren’t exactly scary, they’re definitely surreal. The Fed performed its ritual year-opening document purge overnight... unve...
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| Posted: 13 Jan 2012 10:55 AM PST All your questions about the historic European downgrade should be answered after reading the following FAQ. Or so S&P believes. Ironically, it does an admirable job, because the following presentation successfully manages to negate years of endless lies and propaganda by Europe's incompetent and corrupt klepocrarts, and lays out the true terrifying perspective currently splayed out before the eurozone better than most analyses we have seen to date. Namely that the failed experiment is coming to an end. And since the Eurozone's idiotic foundation was laid out by the same breed of central planning academic wizards who thought that Keynesianism was a great idea (and continue to determine the fate of the world out of their small corner office in the Marriner Eccles building), the imminent downfall of Europe will only precipitate the final unraveling of the shaman "economic" religion that has taken the world to the brink of utter financial collapse and, gradually, world war. Here are the key take home messages from the FAQ (source):
Shockingly, S&P dares to challenge not only the status quo, but "powerful national interest groups" - easily the first time we have seen something like this out of a "status quo" organization, let alone a rating agency.
Why it is all a Catch 22 and why the LTRO "carry trade" has failed:
Let's not forget the EFSF:
And probably the most important observation of the night:
The S&P itself warns that the entire basis of the European bailout will create a split market in sovereign bonds, in which pari passu treatment will be a thing of the past, and in which buyers will have no clue what treatment awaits them in a worst case scenario. If anyone thought that ISDA's idiotic attempt to kill the CDS market caused a collapse in demand for sovereign paper, just wait until potential buyers comprehend they could be primed every step of the way and the market is effectively two tier. S&P may have just killed the European sovereign market by saying out loud what only "fringe bloggers" dared suggest in the past. From S&P FRANKFURT (Standard & Poor's) Jan. 13, 2012--Standard & Poor's Ratings Services today completed its review of its ratings on 16 eurozone sovereigns, resulting in downgrades for nine eurozone sovereigns and affirmations of the ratings on seven others. We have lowered the long-term ratings on Cyprus, Italy, Portugal, and Spain by two notches; lowered the long-term ratings on Austria, France, Malta, the Slovak Republic, and Slovenia, by one notch; and affirmed the long-term ratings on Belgium, Estonia, Finland, Germany, Ireland, Luxembourg, and the Netherlands. All ratings on the 16 sovereigns have been removed from CreditWatch where they were placed with negative implications on Dec. 5, 2011 (except for Cyprus, which was first placed on CreditWatch on Aug. 12, 2011). The outlooks on our long-term ratings on all but two of the 16 eurozone sovereigns are negative; the outlooks on the long-term ratings on Germany and Slovakia are stable. See "Standard & Poor's Takes Various Rating Actions On 16 Eurozone Sovereign Governments," published today for full details. This report addresses questions that we anticipate market participants might ask in connection with our rating actions today. WHAT HAS PROMPTED THE DOWNGRADES? Today's rating actions are primarily driven by our assessment that the policy initiatives that have been taken by European policymakers in recent weeks may be insufficient to fully address ongoing systemic stresses in the eurozone. In our view, these stresses include: (1) tightening credit conditions, (2) an increase in risk premiums for a widening group of eurozone issuers, (3) a simultaneous attempt to delever by governments and households, (4) weakening economic growth prospects, and (5) an open and prolonged dispute among European policymakers over the proper approach to address challenges. The outcomes from the EU summit on Dec. 9, 2011, and subsequent statements from policymakers lead us to believe that the agreement reached has not produced a breakthrough of sufficient size and scope to fully address the eurozone's financial problems. In our opinion, the political agreement does not supply sufficient additional resources or operational flexibility to bolster European rescue operations, or extend enough support for those eurozone sovereigns subjected to heightened market pressures. We also believe that the agreement is predicated on only a partial recognition of the source of the crisis: that the current financial turmoil stems primarily from fiscal profligacy at the periphery of the eurozone. In our view, however, the financial problems facing the eurozone are as much a consequence of rising external imbalances and divergences in competitiveness between the EMU's core and the so-called "periphery". As such, we believe that a reform process based on a pillar of fiscal austerity alone risks becoming self-defeating, as domestic demand falls in line with consumers' rising concerns about job security and disposable incomes, eroding national tax revenues. Accordingly, in line with our published sovereign criteria, we have adjusted downward our political scores (one of the five key factors in our criteria) for those eurozone sovereigns we had previously scored in our two highest categories. This reflects our view that the effectiveness, stability, and predictability of European policymaking and political institutions have not been as strong as we believe are called for by the severity of a broadening and deepening financial crisis in the eurozone. In addition to our assessment of the policy response to the crisis, downgrades in some countries have also been triggered by external risks. In our view, it is increasingly likely that refinancing costs for certain countries may remain elevated, that credit availability and economic growth may further decelerate, and that pressure on financing conditions may persist. Accordingly, for those sovereigns we consider most at risk of an economic downturn and deteriorating funding conditions, for example due to their large cross-border financing needs, we have adjusted our external score downward. WHY WERE SOME EUROZONE SOVEREIGNS DOWNGRADED BY TWO NOTCHES AND OTHERS BY ONE NOTCH? We believe that not all sovereigns are equally vulnerable to the possible extension and intensification of the financial crisis. Those we consider most at risk of an economic downturn and deteriorating funding conditions, for example due to the large cross-border financing needs of its governments or financial sectors, have been downgraded by two notches, as we lowered the political score and/or the external score reflecting our view of the risk of a marked deterioration in the country's external financing. On the other hand, we affirmed the ratings of sovereigns which we believe are likely to be more resilient at their current rating level in light of their relatively strong external positions and less leveraged public and private sectors. These credit strengths remain robust enough, in our opinion, to neutralize the potential ratings impact from the lowering of our political score. In this context, we would note that the ratings on the eurozone sovereigns remain at comparatively high levels, with only three below investment grade (Portugal, Cyprus, and Greece). Historically, investment-grade rated sovereigns have experienced very low default rates. From 1975 to 2010, the 15-year cumulative default rate for sovereigns rated in investment grades was 1.02%, and 0.00% for sovereigns rated in the 'A' category or higher. WHY DO THE RATINGS ON MOST OF THESE SOVEREIGNS HAVE NEGATIVE OUTLOOKS? For those sovereigns with negative outlooks, we believe that downside risks persist and that a more adverse economic and financial environment could erode their relative strengths within the next year or two to a degree that in our view could warrant a further downward revision of their long-term ratings. We believe that the main downside risks that could affect eurozone sovereigns to various degrees are related to the possibility of further significant fiscal deterioration as a consequence of a more recessionary macroeconomic environment and/or vulnerabilities to further intensification and broadening of risk aversion among investors, jeopardizing funding access at sustainable rates. A more severe financial and economic downturn than we currently envisage (see "Sovereign Risk Indicators," published Dec. 28, 2011) could also lead to rising stress levels in the European banking system, potentially leading to additional fiscal costs for the sovereigns through various bank workout or recapitalization programs. Furthermore, we believe that there is a risk that reform fatigue could be mounting, especially in those countries that have experienced deep recessions and where growth prospects remain bleak, which could eventually lead to lower levels of predictability of policy orientation, potentially leading to another downward adjustment of the political score, which might lead to lower ratings. We believe that important risks related to potential near-term deterioration of credit conditions remain for a number of sovereigns. This belief is based on what we see as the sovereigns' very substantial financing needs in early 2012, the risk of further downward revisions of economic growth expectations, and the challenge to maintain political support for unpopular and possibly more severe austerity measures, as fiscal targets are endangered by macroeconomic headwinds. Governments are also aiming to put greater focus on growth-enhancing structural measures. While these may contribute positively to a lasting solution of the current crisis, we believe they could also run counter to powerful national interest groups, whose resistance could potentially jeopardize the reform momentum and impede the recovery of market confidence. In our view, it also remains to be seen whether European banks will indeed use the ample term funding provided by the ECB (see below) to purchase newly issued sovereign bonds of governments under financial stress. We believe that as long as uncertainty about the bond buyers at primary auctions remains, the risk of a deepening of the crisis remains a real one. These risks could be exacerbated should renewed policy disagreements among European policymakers emerge or the Greek debt restructuring lead to an outcome that further discourages financial investors to add to their positions in peripheral sovereign securities. For two sovereigns, Germany and Slovakia, we concluded that downside scenarios that could lead to a lowering of the relevant credit scores and the sovereign ratings carry a likelihood of less than one-in-three during 2012 or 2013. Accordingly we have assigned a stable outlook. HOW DO WE INTERPRET THE CONCLUSIONS OF THE DECEMBER EUROPEAN SUMMIT? We have previously stated our belief that an effective strategy that would buoy confidence and lower the currently elevated borrowing costs for European sovereigns could include, for example, a greater pooling of fiscal resources and obligations as well as enhanced mutual budgetary oversight. We have also stated that we believe that a reform process based on a pillar of fiscal austerity alone would risk becoming self-defeating, as domestic demand falls in line with consumer's rising concerns about job security and disposable incomes, eroding national tax revenues. The outcomes from the EU summit on Dec. 9, 2011, and subsequent statements from policymakers, lead us to believe that the agreement reached has not produced a breakthrough of sufficient size and scope to fully address the eurozone's financial problems. In our opinion, the political agreement does not supply sufficient additional resources or operational flexibility to bolster European rescue operations, or extend enough support for those eurozone sovereigns subjected to heightened market pressures. Instead, it focuses on what we consider to be a one-sided approach by emphasizing fiscal austerity without a strong and consistent program to raise the growth potential of the economies in the eurozone. While some member states have implemented measures on the national level to deregulate internal labor markets, and improve the flexibility of domestic services sectors, these reforms do not appear to us to be coordinated at the supra-national level; as evidence, we would note large and widening discrepancies in activity and unemployment levels among the 17 eurozone member states. Regarding additional resources, the main enhancement we see has been to bring forward to mid-2012 the start date of the European Stability Mechanism (ESM), the successor vehicle to the European Financial Stability Fund (EFSF). This will marginally increase these official sources' lending capacity from currently €440bn to €500bn. As we noted previously, we expect eurozone policymakers will accord ESM de-facto preferred creditor status in the event of a eurozone sovereign default. We believe that the prospect of subordination to a large creditor, which would have a key role in any future debt rescheduling, would make a lasting contribution to the rise in long-term government bond yields of lower-rated eurozone sovereigns and may reduce their future market access. We also believe that the agreement is predicated on only a partial recognition of the source of the crisis: that the current financial turmoil stems primarily from fiscal profligacy at the periphery of the eurozone. In our view, however, the financial problems facing the eurozone are as much a consequence of rising external imbalances and divergences in competitiveness between the EMU's core and the so-called "periphery." In our opinion, the eurozone periphery has only been able to bear its underperformance on competitiveness (manifest in sizeable external deficits) because of funding by the banking systems of the more competitive northern eurozone economies. According to our assessment, the political agreement reached at the summit did not contain significant new initiatives to address the near-term funding challenges that have engulfed the eurozone. The summit focused primarily on a long-term plan to reverse fiscal imbalances. It proposed to enshrine into national legislation requirements for structurally balanced budgets. Certain institutional enhancements have been introduced to strengthen the enforceability of the fiscal rules compared to the Stability and Growth Pact, such as reverse qualified majority voting required to overturn sanctions proposed by the European Commission in case of violations of the broadly balanced budget rules. Notwithstanding this progress, we believe that the enforcement of these measures is far from certain, even if all member states eventually passed respective legislation by parliaments (and by referendum, where this is required). Our assessment is based on several factors, including:
Details on the exact content and operational procedures of the rules are still to emerge and -- depending on the stringency of the rules -- the process of passing national legislation may run into opposition in some signatory states, which in turn could lower the confidence of investors and the credibility of the agreed policies. More fundamentally, we believe that the proposed measures do not directly address the core underlying factors that have contributed to the market stress. It is our view that the currently experienced financial stress does not in the first instance result from fiscal mismanagement. This to us is supported by the examples of Spain and Ireland, which ran an average fiscal deficit of 0.4% of GDP and a surplus of 1.6% of GDP, respectively, during the period 1999-2007 (versus a deficit of 2.3% of GDP in the case of Germany), while reducing significantly their public debt ratio during that period. The policies and rules agreed at the summit would not have indicated that the boom-time developments in those countries contained the seeds of the current market turmoil. While we see a lack of fiscal prudence as having been a major contributing factor to high public debt levels in some countries, such as Greece, we believe that the key underlying issue for the eurozone as a whole is one of a growing divergence in competitiveness between the core and the so-called "periphery." Exacerbated by the rapid expansion of European banks' balance sheets, this has led to large and growing external imbalances, evident in the size of financial sector claims of net capital-exporting banking systems on net importing countries. When the financial markets deteriorated and risk aversion increased, the financing needs of both
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| Posted: 13 Jan 2012 10:45 AM PST Gold Price Close Today : 1,630.60 Gold Price Close 6-Jan : 1,616.10 Change : 14.50 or 0.9% Silver Price Close Today : 2949.3 Silver Price Close 6-Jan : 2865.3 Change : 84.00 cents or 2.9% Gold Silver Ratio Today : 55.288 Gold Silver Ratio 6-Jan : 56.402 Change : -1.11 or -2.0% Silver Gold Ratio : 0.01809 Silver Gold Ratio 6-Jan : 0.01773 Change : 0.00036 or 2.0% Dow in Gold Dollars : $ 157.48 Dow in Gold Dollars 6-Jan : $ 158.10 Change : $ (0.62) or -0.4% Dow in Gold Ounces : 7.618 Dow in Gold Ounces 6-Jan : 7.648 Change : -0.03 or -0.4% Dow in Silver Ounces : 421.19 Dow in Silver Ounces 6-Jan : 431.37 Change : -10.17 or -2.4% Dow Industrial : 12,422.21 Dow Industrial 6-Jan : 12,359.92 Change : 62.29 or 0.5% S&P 500 : 1,289.10 S&P 500 6-Jan : 1,277.81 Change : 11.29 or 0.9% US Dollar Index : 81.531 US Dollar Index 6-Jan : 81.264 Change : 0.267 or 0.3% Platinum Price Close Today : 1,485.80 Platinum Price Close 6-Jan : 1,401.00 Change : 84.80 or 6.1% Palladium Price Close Today : 636.70 Palladium Price Close 6-Jan : 613.20 Change : 23.50 or 3.8% The GOLD PRICE and the SILVER PRICE proved that I had misread the chart yesterday, thinking they had yet one more small leg to rise. However, that euro fall/dollar spurt knocked them back. The GOLD PRICE lost $16.70, closing Comex at $1,630.60; silver gave back 59.9c to end at 2949.3. How much damage was done? Very little. The GOLD PRICE remained above $1,630 support/resistance. Not bad after a week working through two resistance levels ($1,607 and $1,625). However, if gold closes BELOW $1,630, there's no safety net above $1,607, and a fall through $1,607 - $1,600 would evoke painful defections from gold's newly won fair weather friends. Yet this, too, is valuable. Extent of this fall will tell us how healthy gold is, and whether it has bottomed in truth. Even if it fell to $1,550 (don't I wish!), that would merely confirm the previous (29 December) low as a bottom. Only violating that bottom ($1,523.90) would imperil gold with new low prices. If I had to say, and I never can seem to resist saying, it appears that gold has moved stoutly off its bottom and will make one further leg up toward $1,680 before it is dragged back into another correction. If so, Monday or Tuesday surely will see gold rise through $1,650 resistance, perhaps as high as $1,705 before it relents. After all's said and done, the SILVER PRICE gained 2.9% this week, passing several milestones along the way. First, it crossed above the 20 day moving average (2908c). Next, it punched thru the downtrend line from the September highs, and for four days has abided above that line. From a close to the ground viewpoint, silver broke out then went back to the trend line today to plant a final kiss good-bye on its forehead. All this makes it all the more important that silver hold 2950c support, lest the newly boarded rats jump ship. Above silver must clear 3050c resistance. A break of 2950c support would not necessarily take silver below 2850c again, but it would lean it that way sharply. Monday will reveal silver's mind for the week. My money is on higher silver next week. IN SUM, GOLD has most likely bottomed, although SILVER might have one more drop in mind, not necessarily to a new low. Time to start buying. Doing a little thinking the last few days has led to some gold targets I am almost loath to share with y'all, they sound so high. By end of 2012 or January 2013, gold ought to cost $2,660 an ounce. Top of this next wave that just began stands somewhere ABOVE $4,500. Yes, yes, I know it sounds crazy, but I'm just the reporter, not the creator. At $4,500 gold a 30:1 ratio puts silver at $150. Crazy, but y'all will behold it, and with your own eyes. This week's big gainers were platinum (up 6.1%), palladium (3.8%), and silver (2.9%). Gold gained only modestly (0.9%), as did stocks. US dollar index remained above 81 and gained a little ground: rally intact. Tomorrow is the 12th anniversary of the 14 January 2000 all time inflation-adjusted high in the Dow: 11,722. That would equal 15,325 today. So in value-terms, although the Dow today stands nominally above that 11,722 close, it's an illusion. In inflation adjusted dollar terms, the Dow since 2000 has lost 19% of its value. Against gold and silver it has lost much more, over 80%. Today the Dow lost 48.81 (0.4%) to close 12,422.21. S&P500 lost 6.4 (0.5%), ending at 1,289.10. For the week, the Dow tried to penetrate doubled resistance at 12,600 from the long narrow triangle it fell out of last August, failed even to beat 12,500, and has rolled over almost off the bed. Next move will be an Edgar Rice Burroughs special, headed toward The Earth's Core. Will look like a mole with a motor. (Yesterday I wrote that the Dow had fallen out of a "long narrow equilateral" triangle. One puzzled reader wrote to ask me how a triangle could be both long and narrow AND equilateral. I wore out three try-squares trying to figure a way, but couldn't. So scratch the "equilateral." The triangle was just long and narrow, period.) Today the US dollar gained a massive 76.1 basis points (0.98%) to close 81.531, while the euro lost 1.11% to close at a new low for the move, 1.2675. What happened? When talks on cutting Greece's debt looked close to collapsing, the S&P rating agency downgraded government debt of France, Austria, Italy, and Spain by a notch each. From AAA France and Austria fell to AA+, Italy was lowered to BBB+ and Spain twitched from AA- to A. That spooked investors out of euros and into dollars, which may be likened to hiding from a lion in a bear's den. Folks may pretend that Greece, with less than 2% of the Eurozone's GDP, raises no waves when its boat sinks. However, they can't pretend that France doesn't matter, since portfolios all over Europe are stuffed with France government debt which today became worth much less than yesterday. The pretence of debt and fiat money is melting like a wax mask too near the fire. What can any investor count on any longer, when what was supposed to be the lowest risk investment -- government debt -- suddenly devalues overnight, or may even be wholesale devalued in banking deals out of control of investors or citizens? Under these circumstances, I remember those great sentiments of Omar Khayyam, "Ahhh! Take the cash, and let the credit go, nor heed the rumble of a distant drum." You'd better get value in your own hands and in real things, because all the abstracts and illusions are leaving the planet for money heaven. Argentum et aurum comparenda sunt -- -- Gold and silver must be bought. - Franklin Sanders, The Moneychanger The-MoneyChanger.com © 2012, 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. 
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| Posted: 13 Jan 2012 10:39 AM PST 13-Jan (USAGOLD) — Despite the marked revival on Friday of "risk-off" sentiment — and a corresponding jump in the dollar to new 15-month highs — gold continues to display remarkable resilience. The yellow metal closed down $8.75 going into the long holiday weekend, essentially right on the 200-day moving average. However, the market was still up more than $20 on the week and managed to set a new 4-week high on Thursday at 1661.76 before succumbing to those selling pressures. The week went out with a flurry as S&P downgraded France, Italy, Spain, Austria and five other EU member-states. While these downgrades were widely anticipated, they really put a damper on the modest euphoria that sprang from generally favorable Italian and Spanish debt auctions earlier in the week. Fitch is expected to announce a number of downgrades as well by the end of the month. On top of that, efforts to finalize the details of the second Greek bailout broke down. It would seem the buy-in from private bondholders that we were assured was secured back in October, was a falsehood. Weak December retail sales here in the US and a collapse in American exports to Europe sparked a flurry of downward revisions to US growth outlooks. Perhaps not surprisingly, Fedspeak that centered on the increasing likelihood of further accommodations escalated into the weekend. The dangerous passage between Scylla and Charybdis continues. While heightened growth and systemic risks were at the fore this past week, a rather significant rise in Chinese gold demand caught the attention of investors in the yellow metal. This is an important underlying theme that we have been highlighting for a number of years. Several important news articles on this topic were posted on our Breaking Gold News page: China's Gold Imports From Hong Kong Reach Record on Demand They'll make for some interesting reading in between NFL playoff games. Our Broncos will have their hands full with the Patriots.
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| Investing in the Gold Bull Market Like Jesse Livermore Posted: 13 Jan 2012 10:17 AM PST Some ignorant and skittish commentators have been making outrageous claims about the gold "bubble" popping. But here at TDV Golden Trader, we are students of the Austrian Business Cycle Theory (ABCT) and have a deeper understanding ... Read More...
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| Rob Kirby: U.S. rigs bond market with derivatives Posted: 13 Jan 2012 09:54 AM PST 5:50p ET Friday, January 13, 2012 Dear Friend of GATA and Gold: Writing at GoldSeek today, GATA consultant Rob Kirby of Kirby Analytics in Toronto shows how the U.S. government works through five major banks using interest rate derivatives to control the bond market, defeating the "bond vigilantes" of old and facilitating endless wars and government bloat in what is by far the biggest part of the government's manipulation of markets. Kirby's commentary is headlined "The U.S. Dollar-Centric Derivatives Complex: Progenitor of Parasitic, Ponzi Price-Fixing" and it's posted here: http://news.goldseek.com/GoldSeek/1326469500.php CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Prophecy Drills 384.9 Meters Grading 0.623 g/t PGM+Au, Company Press Release VANCOUVER, British Columbia -- Prophecy Platinum Corp. (TSX-V: NKL, OTC-QX: PNIKF, Frankfurt: P94P) has announced the final drill results from 2011 drilling at the company's fully owned Wellgreen platinum group metals, nickel, and copper project in the Yukon Territory. Borehole WS11-192 intercepted 384.9 meters of 0.45 percent nickel equivalent starting from 9.45 meters depth. Included in this greater interval of continuous mineralization is a platinum group metals-rich zone with a combined platinum-palladium-gold grade of 1.358 grams per ton over 19.23 meters (nickel equivalent 0.74%). The final drilling results for 2011 have shown the Wellgreen Central-East and Central-West deposits to be one contiguous body, whereby there is good potential to broaden significantly the Central-West resource base, which currently contributes only about a quarter of the current 43-101 compliant resource at Wellgreen. Overall the drilling program met with good success in expanding the resource to the east and south. The long drill intercepts suggest the deposit remains very much open in those directions. For the complete drilling results and the full company statement, please visit: http://prophecyplat.com/news_2011_dec08_prophecy_platinum_wellgreen_dril... Join GATA here: Vancouver Resource Investment Conference http://cambridgehouse.com/conference-details/vancouver-resource-investme... California Investment Conference 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: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Sona Discovers Potential High-Grade Gold Mineralization From a Company Press Release 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
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| Faber's Latest Rant On Global Monetization Wars Posted: 13 Jan 2012 09:54 AM PST There is a little for everyone in Marc Faber's latest appearance on CNBC. The infamous boomer (and doomer) believes (as we do) that today's downgrades are less significant for stocks (at least until the realization that banks and more importantly insurance companies are about to be cut as well - keep a close eye out on Allianz and Generali (of ASSGEN fame) - it is not incidental that they are abbreviated to A&G, just one letter away from our own AIG) as it is largely priced in but the equity market's rally of the last few weeks (with its lack of breadth and volume) is strongly suggestive of a bear-market rally (as opposed to the decoupling bull market that so many hope for). His view quite simply is that the ECB has undergone a backdoor monetization and without this the EUR would be significantly stronger especially given the huge short-interest (though he sees the trend for EUR is down). However, he remains unenthusiastic at the inevitable outcome - suggesting the majority of European nations deserve a CCC rating (which is clearly not priced in) and that the USA should not be AAA (noting that even Germany has huge unfunded liabilities as it writes check after check to save its socialist sorority sisters). Admitting that he was wrong on US Treasuries (short) last year, he still worries of the long-term value in holding the ponzi-paper and addresses what seemed like the theory-du-jour that a weaker EUR is good for European exports and so all-is-well in the world by pointing out (among other things) that many large European corporations have huge amounts of USD-denominated debt making their debt servicing costs much higher. His perspective on Europe is interesting, concerned that we may see one country say enough-is-enough and leave the Euro, he believes the US outperformance over Europe will unwind and that quality companies in Europe and Emerging Markets are the place to be for investors. Noting that they are admittedly not compelling values he points to the difficulty of valuing anything in a zero-interest rate environment. The worse the global economy looks, the weaker the Chinese economy performs, and the more the reaction will be money printing which will lift equity prices (whereas the real economy is faltering and standards of living going down fast) leaving him holding gold at the core but realizing stocks will rise nominally. Finally, his "black swan" scenario is some country saying "we've had enough. We are exiting the euro." Which brings us to the issue of the Greek coercive restructuring which now appears to be just a matter of weeks if not days away. And once Greece pulls the plug, and the Eurozone does not implode (hypothetically), it will set an example whereby more and more countries do the same, until finally the system does crash under its own weight, as everyone does a CDS-triggering restructuring, in effect tearing the Eurozone from the inside.
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| Jim Rogers: US Govt to ‘Juice Up’ Economy in Election Year Posted: 13 Jan 2012 09:47 AM PST The U.S. government will spend beyond its means and the Federal Reserve will print money to juice up the economy as part of an election-year popularity ploy, says international investor Jim Rogers. "You have to remember two things — election in America in November, so you are going to see a lot of good news. Of course you have the American government spending staggering amounts of money right now, printing a lot of money and getting ready for the election," Rogers tells The Economic Times, an Indian English-language daily newspaper. "It happens every four years in America. They do their best to get the economy juiced up so they can win the election." The Federal Reserve has carried out two rounds of quantitative easing, which are asset purchases from banks with freshly printed money designed to pump up the economy, and some Fed officials have said a third round may be needed this year. Under such a scenario, investors should invest in the commodities, which strengthen amid a weakening dollar, the side effect of accommodative monetary policies. "If the world economy gets better, then obviously commodity prices will do well because of the shortages," Rogers says. "If the world economy does not get better, they are going to print a lot of money and you need to own real assets when they print money and yes there are 40 elections this year and yes they are going to print more money." Some Federal Reserve officials say encouraging economic indicators, such as December's jobs report that showed the economy added a net 200,000 nonfarm payrolls, make further quantitative easing unlikely at this time. "Hopefully, we will keep this momentum going in 2012," says Federal Reserve Bank of St. Louis President James Bullard, according to Bloomberg. "The tone of the data has been very strong" and the central bank "probably could wait and see for now" before deciding whether there is a need for more accommodation. Source: Moneynews
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| Charles Krauthammer: Ron Paul's achievement Posted: 13 Jan 2012 09:30 AM PST By Charles Krauthammer http://www.washingtonpost.com/opinions/ron-pauls-achievement/2012/01/12/... There are two stories coming out of New Hampshire. The big story is Mitt Romney. The bigger one is Ron Paul. Romney won a major victory with nearly 40 percent of the vote, 16 points ahead of No. 2. The split among his challengers made the outcome even more decisive. Rick Santorum and Newt Gingrich were diminished by distant, lower-tier finishes. Rick Perry got less than 1 percent. And Jon Huntsman, who staked everything on New Hampshire, came in a weak third with less than half of Romney's vote. He practically moved to the state -- and then received exactly one-sixth of the vote in a six-man contest. Where does he go from here? But the bigger winner was Ron Paul. He got 21 percent in Iowa, 23 in New Hampshire, the only candidate other than Romney to do well with two very different electorates, one more evangelical and socially conservative, the other more moderate and fiscally conservative. ... Dispatch continues below ... ADVERTISEMENT Be Part of a Chance to Discover 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. Paul commands a strong, energetic, highly committed following. And he is unlike any of the other candidates. They're out to win. He admits he doesn't see himself in the Oval Office. They're one-time self-contained enterprises aiming for the White House. Paul is out there to build a movement that will long outlive this campaign. Paul is less a candidate than a "cause," to cite his primary-night New Hampshire speech. Which is why that speech was the only one by a losing candidate that was sincerely, almost giddily joyous. The other candidates had to pretend they were happy with their results. Paul was genuinely delighted with his, because, after a quarter-century in the wilderness, he's within reach of putting his cherished cause on the map. Libertarianism will have gone from the fringes -- those hopeless, pathetic third-party runs -- to a position of prominence in a major party. Look at him now. He's getting prime-time air, interviews everywhere, and, most important, respect for defeating every Republican candidate but one. His goal is to make himself leader of the opposition -- within the Republican Party. He is Jesse Jackson of the 1980s, who represented a solid, African American, liberal-activist constituency to which, he insisted, attention had to be paid by the Democratic Party. Or Pat Buchanan (briefly) in 1992, who demanded -- and gained -- on behalf of social conservatives a significant role at a convention that was supposed to be a simple coronation of the moderate George H.W. Bush. No one remembers Bush's 1992 acceptance speech. Everyone remembers Buchanan's fiery and disastrous culture-war address. At the Democratic conventions, Jackson's platform demands and speeches drew massive attention, often overshadowing his party's blander nominees. Paul won't quit before the Republican convention in Tampa. He probably will not do well in South Carolina or Florida, but with volunteers even in the more neglected caucus states, he will be relentlessly collecting delegates until Tampa. His goal is to have the second-most delegates, a position of leverage from which to influence the platform and demand a prime-time speaking slot -- before deigning to support the nominee at the end. The early days of the convention, otherwise devoid of drama, could very well be all about Paul. The Democratic convention will be a tightly scripted TV extravaganza extolling the Prince and his wise and kindly rule. The Republican convention could conceivably feature a major address by Paul calling for the abolition of the Fed, FEMA, and the CIA; American withdrawal from everywhere; acquiescence to the Iranian bomb -- and perhaps even Paul's opposition to a border fence lest it be used to keep Americans in. Not exactly the steady, measured, reassuring message a Republican convention might wish to convey. For libertarianism, however, it would be a historic moment: mainstream recognition at last. Put aside your own view of libertarianism or of Paul himself. I see libertarianism as an important critique of the Leviathan state, not a governing philosophy. As for Paul himself, I find him a principled, somewhat wacky, highly engaging eccentric. But regardless of my feelings or yours, the plain fact is that Paul is nurturing his movement toward visibility and legitimacy. Paul is 76. He knows he'll never enter the promised land. But he's clearing the path for son Rand, his better-placed (Senate vs. House), more moderate, more articulate successor. And it matters not whether you find amusement in libertarians practicing dynastic succession. What Paul has already wrought is a signal achievement, the biggest story yet of this presidential campaign. ----- Charles Krauthammer is a syndicated columnist. Join GATA here: Vancouver Resource Investment Conference http://cambridgehouse.com/conference-details/vancouver-resource-investme... California Investment Conference 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: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Golden Phoenix Receives Inferred Gold Resource Estimate Company Press Release Golden Phoenix Minerals Inc. (OTC: GPXM) reports that on behalf of Golden Phoenix Panama S.A., the joint venture entity that owns and operates the Santa Rosa gold mine in Panama, it has received from SRK Consulting (U.S.) an initial resource estimate for Mina Santa Rosa. The Santa Rosa project is a volcanic-hosted epithermal gold-silver deposit previously operated as an open pit-heap leach operation. Production ceased in 1999 in part because of low gold prices. SRK Consulting reports an in-situ inferred resource at the former Santa Rosa and ADLM pits totaling 23.1 million metric tonnes at 0.90 grams/tonne gold, for a contained 669,000 ounces of gold at a 0.30 g/t gold cutoff. The resource also contains an average grade of 2.87 g/t silver for a contained 2.1 million ounces of silver. John Bolanos, Golden Phoenix's vice president of exploration, remarks: "In addition to SRK's inferred resource estimate of 669,000 contained ounces of For the company's full statement, including a table detailing the resources at Santa Rose, please visit: http://goldenphoenix.us/press-release/golden-phoenix-receives-initial-ni...
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| Stock Futures Close Almost Green Even As Protection Costs Jump Posted: 13 Jan 2012 09:13 AM PST The post-European-close rally-monkey was in full force today, with somewhat average (though NYSE volume is 30% lower than last January's average!) volumes in stocks, as ES (the e-mini S&P 500 futures contract) made it almost back to unchanged in a post-cash-close squeeze (on notably lower-than-average trade size). However, close-to-close, the cost of protecting equity and credit (in options volatility, implied correlation, and CDS) all rose (underperformed) significantly. It seems everyone believes everything bad (event-wise) is priced in but perhaps they are missing the reality of mundane macro data and earnings.
As we warned last night on the Maiden Lane chatter, high yield credit (and ABX/CMBX today) was hit hard early on (and so was HYG when it opened) which allowed it to catch up to equity's weakness and suggesting that yesterday's exuberance was overdone (on the back of the gamma-gorging early on). The late-day surge (after the cash close) seemed like stop-hunting (since average trade size was much lower than normal) helped by the EUR margin cuts at CME.
Given the huge reversal in short-covering (now back to balanced and moving modestly short again) and ahead of a long weekend with potential for further PSI disappointment, we suspect the rise in implied correlation and lack of follow-on from HY credit or HYG means this was not representative of risk appetite (even as ES and medium-term CONTEXT held together closely).
After hitting 16 month lows into the European close, EURUSD spent the rest of the day leaking higher as European ministers played down the downgrades. We believe that while the downgrades are important, it is the Greek PSI talk fails that are far more important. The strength in AUD was a major driver of late day equity market moves (as AUD gained almost 1% against the USD and was best among the majors). EURUSD lost 0.3% on the week and DXY (the USD proxy) gained only 0.23% but had a significant up-day today closing above the early-week highs. Cable (GBP and SEK were the worst performers on the week and fascinatingly JPY was almost exactly unch on the week.
As the USD strengthened the last day or so, the more economically-sensitive commodities have slid lower. Copper did managed to hold on near the week's highs (the only metal up today and up 5.88% on the week). Silver and Gold lost ground from the European close yesterday but held 3.25% and 1.3% gains on the week (bucking the USD strength). Oil ended up losing the plot, down 2.4% on the week but managing to climb back over $99 into the close today.
From a broad-risk-driver perspective, the week was relatively calm in two halves. ES and CONTEXT stayed together on the early way up, then as stocks fell broad risk assets were not as concerned and maintained suport for the resumption of the ES raly into Thursday's early highs but as macro data and then rumors/chatter out of Europe arrived, risk (CONTEXT) fell notably and ES slowly at first then quickly reverted this morning back to its 'fair-value'. From around the European close ES and CONTEXT were very closely in sync and ended right on top of one another. Critically with US shut on Monday, we will need to see EUR weakness (perhaps on PSI failure) to drag us down more from here in a convincing manner. Charts: Bloomberg
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| Money Printing: The Ugly Truth Behind the “Good News” Posted: 13 Jan 2012 09:02 AM PST Bill Bonner View the original article. January 13, 2012 01:30 PM Yesterday's trading revealed nothing of importance. Small moves in stocks and gold. And oil dipped below $100. But the news has been generally "good" ever since the European Central Bank made it clear that it will print money rather than see major banks or minor nations get what is coming to them. Like its US counterpart, the ECB will not permit a major bank or sovereign debtor to go bust. "ECB sees signs of let-up in debt crisis," is today's headline in The Financial Times. Let's see…the news report goes on to tell us that Spain and Italy were able to sell 22 billion euros of debt yesterday, proving that they can still finance their deficits…and that, therefore, we have nothing to worry about. To whom did they sell their bonds? We don't know, but we presume the buyers were banks who were investing money they got on favorable terms from the ECB. So, you see, dear reader, that their willingness to buy the ...
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| Who Really Owns Your Gold Stocks? Posted: 13 Jan 2012 08:42 AM PST Dear Friends, Please do not sleep on my dear friends. If you do nothing, you may very well have nothing in the end. If you do not want to get it in the end you will have to act now on what I have already told you. The material contained in here concerning the system and market events is correct, even though it proposes its own solution. I should know. I have owned brokerage and clearing houses. The answer lies, in my opinion, in going to direct registration at the transfer agent and out of the clearing agent and ultimately, where possible, to paper certificates. If the company you are invested in does not participate in direct registration and also does not issue paper certificates, raise hell with them. Who Really Owns Your Gold Stocks? Jeff Berwick Published 1/11/2012 Do you own gold and silver mining stocks? Or any stocks for that matter? Even if you say, "yes", chances are you don't really own them. It is one of the dirtiest little secrets i...
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| Money Printing: The Ugly Truth Behind the “Good News” Posted: 13 Jan 2012 08:30 AM PST Yesterday's trading revealed nothing of importance. Small moves in stocks and gold. And oil dipped below $100. But the news has been generally "good" ever since the European Central Bank made it clear that it will print money rather than see major banks or minor nations get what is coming to them. Like its US counterpart, the ECB will not permit a major bank or sovereign debtor to go bust. "ECB sees signs of let-up in debt crisis," is today's headline in The Financial Times. Let's see…the news report goes on to tell us that Spain and Italy were able to sell 22 billion euros of debt yesterday, proving that they can still finance their deficits…and that, therefore, we have nothing to worry about. To whom did they sell their bonds? We don't know, but we presume the buyers were banks who were investing money they got on favorable terms from the ECB. So, you see, dear reader, that their willingness to buy the debt does not necessarily mean that either buyer or lender is solvent. Probably, neither is… But with fears of a debt debacle in Europe off the front page headlines…the financial world has seemed rather benign, especially in America. US stocks have rallied since October. The latest unemployment report from the feds was surprisingly upbeat. The dollar is strong. And US consumers are now re-leveraging, going deeper into debt in order to buy things. Does this mean the Great Correction is over and done with? Nah… Europe is either already in recession…or entering recession. Leading indicators in the Old World are plunging sharply… Manufacturing in the US is softening… And European sales affect 20% of US corporate revenue… A strong dollar actually makes it harder for US companies to sell their products overseas, and it reduces the contribution made by foreign subsidiaries to US earnings reports. Oil, meanwhile, has remained near $100 despite a sell-off in commodities and "risk-on" assets. This leaves both business and consumers with little free cash to spend…and squeezed profit margins. Already, corporate profit margins are beginning to come down…as they should. The Fed came out with its "Beige Book" this week. Our reading of the report — which includes updates from 10 districts around the country — is that conditions haven't gotten any worse…but that they haven't gotten any better either. Most important, the two key ingredients in household wealth — wages and housing values — remain in a slump. None of the 10 districts reported much improvement in either area. So, even if consumers did go on a bit of a shopping spree over the holidays, it is unlikely to continue. Because there is nothing behind it. Remember, this time it IS different. This time there is nowhere to go but down. Households could increase their debt levels in the '80s, '90s and '00s only because 1) they began at a fairly modest level, and 2) housing prices were going up. While household debt has come back down to levels of the early '00s…they have a long way to go before they are back to the long-term averages of the '60s, '70s and '80s. As for employment, the latest numbers were better than they had been but hardly a sign of a real recovery. From the "WorkBlog" at The Washington Post: On Friday, we got the December jobs number: +200,000. That's good, but not good enough. I posted a graph from the Hamilton Project showing that, at that rate, the labor market wouldn't recover till 2024. But perhaps that's too pessimistic. The Economic Policy Institute took a look at the same numbers and concluded that a growth rate of 200,000 jobs per month would lead to a full recovery in seven years or so. That's nothing to celebrate, but it's better than the Hamilton Project's estimate of 12 years. It's also a bit odd: Isn't this a simple matter of taking job losses and dividing by monthly job gains? Well, no. The date of our eventual recovery depends on some crucial unknowables about the future of the American labor force. The blogger doesn't mention it, but even while the unemployment rate might go back to 'normal' in 7 to 12 years, the latest figures show household income still going down. That's not going to do much for household budgets or purchasing power. Or their borrowing power, for that matter. Who's going to lend to households when both their ability to repay (their wages) and their collateral (their houses) are going down? And what are aging baby boomers going to retire on, if they continue to borrow against declining collateral? Our verdict: The higher borrowing and spending at the household level in December was a fluke, we believe, not a sustainable trend. The Great Correction continues… Bill Bonner Money Printing: The Ugly Truth Behind the "Good News" originally appeared in the Daily Reckoning. The Daily Reckoning, published by Agora Financial provides over 400,000 global readers economic news, market analysis, and contrarian investment ideas.
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| Gold Daily and Silver Weekly Charts Posted: 13 Jan 2012 08:18 AM PST |
| Posted: 13 Jan 2012 08:16 AM PST Hat tip to Mary Malone for sending this to me. No comment required. The story speaks for itself. Do you understand who to blame for our economic collapse? Everything You Need to Know About Wall Street, in One Brief Tale By Matt Taibbi If there was ever a news story that crystalized the moral dementia [...]
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| Posted: 13 Jan 2012 08:12 AM PST
Santa Rally brought us straight up to resistance levels. With today's news on the European Downgrade out of S&P the market is feeling nervousness again. The slow no volume melt up over the past weeks made people comfortable running positions they don't actually feel comfortable with. The Volatility collapse has attracted way too much dumb money chasing long only ideas. Chart comparison with 2008 below, or is this time different?
SPX and Vix
Some more simple charts click here.
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