Gold World News Flash |
- More QE on the Way
- Richard Russell: COMEX Gold & Silver Shorts in Do-or-Die Battle
- Gold Seeker Closing Report: Gold and Silver Rise With Oil
- Silver Outperforming Nearly All Other Assets YTD
- America After Dark: Desperate Meth Heads, Rampant Human Trafficking And Millions Of Criminal Predators Searching For A New Victim
- No More Tinfoil Hats
- World Gold Council Report: A Look Back ? A Look Forward
- The Silver Bullet and the Silver Shield Part 1.
- Ron Hera Saw Gold Buried at the Vancouver Resource Conference – 01-22-2012
- The Art Of Extortion: Now At The IMF
- Gold and Silver Advance / Euro Breaks to the Upside / No Greek Deal
- Goldman Previews The Fed's Statement, Plays Down Expectations Of A “Dovish Surprise”
- Platinum: Industrial Man's Gold
- When Will Silver Reach a New High?
- Goldman Previews The Fed's Statement, Plays Down Expectations Of A "Dovish Surprise"
- Gold Next Resistance is Clustered around 1700
- The Gold Price Reached my $1,680 Target and Should Now Rally to $1,705
- Gold Chart and comments
- Resource Clips interview with GATA: No more tinfoil hats
- Silver’s Surge
- Volume Crashes As Stocks End Unchanged
- Juan Ramón Rallo and Alasdair Macleod talk about the Spanish economy, gold and silver
- Greek Debt Deal Rejected As S&P Begins European Bank Downgrades
- Getting out of Dodge, Part II
- America: "Still the Place to Be"
- Look for Gold Juniors with Theme-Changing Catalysts: Annie Zhang
- Gold Daily and Silver Weekly Charts
- Eveillard: ‘We are Headed for Enormous Inflation & Higher Gold'
- Von Greyerz - Gold Breaking Out, Will Hit New All-Time Highs
| Posted: 23 Jan 2012 05:57 PM PST The Gold Speculator
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| Richard Russell: COMEX Gold & Silver Shorts in Do-or-Die Battle Posted: 23 Jan 2012 04:42 PM PST  With gold and silver consolidating recent gains and the Dow closing yesterday near the 12,700 level, the Godfather of newsletter writers, Richard Russell, had this to say in his latest commentary: "The character of the market is improving. Volume on Friday's buying was the strongest of the year with upside volume being 85% of total upside plus downside volume. The negative spread between Lowry's downside and upside volume contracted from 190 last Friday to 169 yesterday, a huge improvement."
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| Gold Seeker Closing Report: Gold and Silver Rise With Oil Posted: 23 Jan 2012 04:00 PM PST Gold climbed $11.50 to $1677.40 in London before it fell back to $1666.30 by a little after 9AM EST, but it then rallied to a new session high of $1681.40 by late morning in New York and ended with a gain of 0.73%. Silver surged to $32.772 in London before it fell back to $31.899, but it then bounced back higher and ended with a gain of 0.65%.
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| Silver Outperforming Nearly All Other Assets YTD Posted: 23 Jan 2012 03:58 PM PST by SGT:
It sure looks like silver has gotten its mojo back. Let's not count our chickens just yet, but January has been a banner month for the incredibly precious metal. Silver has outperformed just about every asset class and ETF since the start of the year. At the moment I'm writing this, Ag is at $32.50 and is up approximately 17% since the first trading day of 2012… not a bad way to start the year. Governments worldwide can keep on printing, we'll just keep on stackin'.
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| Posted: 23 Jan 2012 03:48 PM PST from The Economic Collapse Blog:
Read More @ TheEconomicCollapseBlog.com
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| Posted: 23 Jan 2012 03:45 PM PST GATA's Bill Murphy, Chris Powell interviewed by Kevin Michael Grace, ResourceClips.com:
Fresh from a packed presentation on "GATA's Tremendous Year in 2011," Chairman Bill Murphy and Secretary-Treasurer Chris Powell of the Gold Anti-Trust Action Committee came over to the Resource Clips booth to have some pictures taken and answer some questions. Murphy told us that that he's known Joe Martin, "who runs these conferences and does such a great job," since 1997. "Then we formed GATA in 1999, and we've been coming to the Cambridge House conferences here in Vancouver and elsewhere since then, and they're terrific." Murphy says that in the 13 years since GATA's formation, "Our credibility has really surged, because we know what's happening and why." Powell adds, "My sense is that most people seriously involved in the gold market either know that central banks are interfering surreptitiously or have strong suspicions that they are. We're not considered men from Mars anymore, tinfoil-hat wearers. As we've seen from essays in the Financial Times and the Wall Street Journal and other publications, 'financial repression' is now a commonly used phrase. It means central banks intervening in markets. I don't think it's been used explicitly in connection with the gold market yet, but I consider this a very big step in the perception of GATA's position."
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| World Gold Council Report: A Look Back ? A Look Forward Posted: 23 Jan 2012 03:32 PM PST [INDENT]Lorimer Wilson, editor of www.FinancialArticleSummariesToday.com (A site for sore eyes and inquisitive minds) and www.munKNEE.com (Your Key to Making Money!) has edited ([ ]), abridged (…) and reformatted (some sub-titles and bold/italics emphases) the article below for the sake of clarity and brevity to ensure a fast and easy read. The article’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article. Please note that this paragraph must be included in any article re-posting to avoid copyright infringement. [/INDENT]The report*goes on to say, in part: After a tumultuous year in financial markets around the world, gold was one of few asset classes to deliver positive returns (Chart 1) up 9% in 2011…based on the London PM fix, marking the 11th consecutive year of price increases. Chart 1: Relative price performace in 2011 for various assets Gold's price appreciation was generally higher ...
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| The Silver Bullet and the Silver Shield Part 1. Posted: 23 Jan 2012 03:23 PM PST |
| Ron Hera Saw Gold Buried at the Vancouver Resource Conference – 01-22-2012 Posted: 23 Jan 2012 02:40 PM PST from The Financial Survival Network:
Ron talks about several companies he thinks have good prospects. They are nearing production, have a good quality ore deposit, and should easily make the transition from development to production. Of course we do not ever recommend any stocks mentioned on the show, but we appreciate Ron's observations greatly. Click Here to Listen to the Podcast
This posting includes an audio/video/photo media file: Download Now |
| The Art Of Extortion: Now At The IMF Posted: 23 Jan 2012 01:45 PM PST Wolf Richter www.testosteronepit.com Treasury Secretary "Hank" Paulson was the trailblazer with his proposal for TARP in September 2008. He walked into the Capitol with a list of demands—unlimited powers to hand unlimited amounts of taxpayer money to whomever—and threatened that the whole world would collapse if his demands weren't met immediately. When Congress didn't go for it, markets fell off a cliff, and Paulson's world of finance appeared to come to an end. So Congress approved a more limited TARP, which ended up being irrelevant compared to the trillions the Fed would hand out. Thus, Paulson's extortion had worked—though the source of money had shifted from the Treasury to the Fed. It would be copied. In November, just after the G-20 meeting in Cannes, France, it was Greek Prime Minister Giorgios Papandreou's turn. With a single sentence about a referendum on Greece's exit from the Eurozone, he knocked the world's financial markets into a tailspin. His message: give me more money and larger write-downs on Greek debt, or else I will say a whole paragraph. It reopened the spigot, and money started flowing again (temporarily). In early January, it was Greece's new Prime Minister Lucas Papademos. He threatened the world with "disorderly default." His goal: impose salary cuts on private-sector workers and ever bigger "voluntary" haircuts on banks and hedge funds that hold Greek debt. "So we can get the next loan installment," he explained. Unions rebelled, and bondholders dug in their heels, but they started talking again. For that whole debacle, read.... Greece's Extortion Racket Maxed Out. Now Christine Lagarde, managing director of the IMF, has stepped into the extortion racket herself and threatened that there would be another Great Depression—the red line on the financial threat-o-meter—if certain countries and their taxpayers didn't fork over more money. She never mentioned Germany and the US by name, but those were her prime targets. "It is about avoiding a 1930s moment," she said at the German Council of Foreign Affairs in Berlin, "a moment, ultimately, leading to a downward spiral that could engulf the entire world." Paulson couldn't have phrased it more darkly. The discussions Sunday evening between her and German Chancellor Angela Merkel must have been interesting, and there was no dog and pony show or even common statement afterwards. But Monday, Lagarde made clear what she wanted: - €500 billion in mostly German taxpayer money to double the size of the future bailout fund, the ESM, to €1 trillion, so that it would be large enough to bail out Italy and Spain. Their insolvency "would have disastrous implications for systemic stability," she threatened. So, pay up German taxpayers. - $500 billion in taxpayer money from around the world, specifically from the US, Japan, and Germany, the three largest contributors to the IMF, to double its bailout lending power to $1 trillion. - More government spending in those European countries that can afford it, to stimulate the economy for everyone else. She didn't mention Germany, but German taxpayers, please step up to the plate. Your money is needed elsewhere. Or else— - Common liabilities, such as Eurobonds, through which taxpayers in fiscally stronger countries, like Germany, would guarantee the debt of others. - Elimination of trade imbalances by stimulating internal demand in countries with large trade surpluses. Alas, Germany's economy lives and dies by its exports, and a drop in the surplus has a vicious effect on GDP. Read.... Germany's Export Debacle. Merkel and her government immediately rejected Lagarde's demands on essentially all fronts. To commit more money to the ESM would also require a vote in the Bundestag where the last bailout increase passed only by a thin margin. And the US Congress is in no mood to hand over more money to the IMF. But as Paulson's efforts have shown, extortion has a way of migrating. If recent history is any guide, Lagarde's threat of another Great Depression will work, and money will start flowing from taxpayers to her anointed recipients. Meanwhile, in one of the most above-board shining examples of a virtuous country in the Eurozone—the outright opposite of Greece—there has been a hiccup. Read.... Bribery, Kickbacks, and Money Laundering at the Austrian National Bank.
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| Gold and Silver Advance / Euro Breaks to the Upside / No Greek Deal Posted: 23 Jan 2012 01:41 PM PST by Harvey Organ: Good evening Ladies and Gentlemen: Today's commentary is will short as I have arrived home late today. The price of gold rose by $14.30 to $1678. Silver also rose by 59 cents to $32.24. I would like to caution you that we have the FOMC meeting results on Wednesday and Thursday is the dreaded options expiry. So be careful as our bankers surely raid around these events. Let us head over to the comex and assess trading, inventory movements and of course amounts of gold and silver standing. The total gold comex OI fell by 2833 contracts from 441,320 to 438,487. Because gold had a good day on Friday we must have seen some liquidations probably by our banker friends. The front options expiry month of January saw its OI fall from 53 to 42 for a loss of 11 contracts. We had 11 delivery notices on Friday so we neither gained nor lost any gold and thus no cash settlements. The next big delivery month for gold is next week as first day notice is next Tuesday the 31st of January. Here the OI fell from 156,621 to 148,308 and this movement to a futures month is on schedule. Nothing earth shattering here. The estimated volume at the gold comex came in at 147,018 which is very mild. The confirmed volume on Friday with a big rise in gold came in at 153,683 which is also tame. Due to the confiscation with respect to the MF GLobal fiasco fewer players are playing the comex casino. Read More @ HarveyOrgan.Blogspot.com
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| Goldman Previews The Fed's Statement, Plays Down Expectations Of A “Dovish Surprise” Posted: 23 Jan 2012 01:12 PM PST from ZeroHedge:
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| Platinum: Industrial Man's Gold Posted: 23 Jan 2012 01:06 PM PST by Andrey Dashkov, Casey Research:
Platinum – sometimes called "the richer man's gold," has been generating a lot of buzz lately. Historically platinum has sold for more than gold, but today it's selling for considerably less than gold. Is this an anomaly worth betting money on? Or have market forces changed, causing a shift in the apparent price relationship between the two? To attempt an answer to these questions, let's have a look at platinum fundamentals. Supply South Africa tops the list of producers with 74.7% of global production (4.8 million ounces in 2011) and 95.5% of known reserves. Russia is a distant second with 825,000 ounces produced in 2011 and 1.7% of known reserves. With so much of the world's platinum production controlled by one country, the question of supply stability is extremely relevant. South Africa's aggregate Policy Potential Index ranks it 67th out of 79 countries in the Fraser Institute's 2010/2011 Survey of Mining Companies report. For mining companies, South Africa is challenging in at least two ways: It faces power shortages that the country's state-owned power utility says could last five years; and increasing labor regulations and costs have compounded the infamous miners' strikes that have been in the news recently.
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| When Will Silver Reach a New High? Posted: 23 Jan 2012 11:26 AM PST In last week's Metals, Mining, and Money from Casey Research, Jeff Clark estimated that given the magnitude of the correction that started last September, it may take until May 2012 for gold to reach a new high. Read More...
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| Goldman Previews The Fed's Statement, Plays Down Expectations Of A "Dovish Surprise" Posted: 23 Jan 2012 11:10 AM PST As widely expected by Zero Hedge, barely a few months after the arrival of former Goldmanite Mario Draghi to head ECB, the ECB's balance sheet exploded by nearly $1 trillion. Naturally, such is the way of central banks infiltrated by tentacles of the squid: no surprises. Which brings us to the first Fed meeting of 2012 and its public manifestation: the FOMC's January 25 statement. As is well known, while the Goldman addition to the ECB is a recent development, its agent at the Fed, the head of the FRBNY Bill Dudley has been there for a quite a while - in fact ever since the tax-challenged Mike Judge character impersonator left to become Treasury Secretary. As was suggested on Zero Hedge, it was the meetings of Bill Dudley with Goldman's Jan Hatzius at the Pound and Pence, and of course elsewhere but these are the only public recorded ones, that have shaped monetary policy more than anything. In other words, if anyone can predict, not to say define, US monetary policy, it would be Jan Hatzius. Below are his just released "thoughts" on what to expect on Wednesday. What is odd is that whereas a month ago Goldman was convinced that an LSAP version of QE was imminent, now the firm has become substantially less optimistic. Is it time to manage down expectations? To wit: "Given the improvement in the economic indicators and the easing of financial conditions that has occurred in the meantime, we believe it is less central now. While Fed officials are certainly not targeting a tightening of conditions, we doubt that they will "bend over backwards" to deliver a dovish surprise relative to current market expectations." So just how much QE3 is priced in if Goldman is already doing disappointment damage control. Or did Goldman finally wise up and realize that the only effective Fed statement is the one that surprises. So if Goldman does not publicly expect QE3, and we do in fact get a notice thereof, it will have an immediate knee jerk reaction on risk, and of course, Gold. These and many more questions shall be answered at 12:30 pm on Wednesday. FOMC Preview
Q: What will happen on Wednesday? A: Following its two-day meeting on January 24-25, the Federal Open Market Committee (FOMC) will publish the following: 12:30 pm: The regular FOMC policy statement. 2.00 pm: Materials from the Summary of Economic Projections (SEP). These will include: 1. An expanded version of Table 1 showing the range and central tendency--the range excluding the top 3 and bottom 3 entries--of the 17 FOMC meeting participants' projections for real GDP growth, the unemployment rate, the headline and core PCE price index, and presumably the federal funds rate, by year through the end of 2014 as well as for the "longer term." (There will be no "longer-term" projection for the core PCE index.) 2. The entire distribution of 17 projections (without attribution) for the federal funds rate by year through the end of 2014, as well as the "longer term." 3. The entire distribution of 17 projections (without attribution) for the year of the first rate hike through 2016. Somewhat to our surprise, the template for the projections released on Friday afternoon suggests that the date of the first hike will only be specified in annual terms; we had expected quarterly or at least semiannual information. 2.15 pm: Opening statement for the chairman's press conference. Q: Will we get a qualitative discussion of the outlook for the Fed balance sheet? A: Probably not until the full SEP is published on February 15, alongside the FOMC minutes. However, Chairman Bernanke might reveal some of the committee's thinking in the press conference, which is virtually certain to feature questions about the outlook for the balance sheet. Q: Anything else? A: The FOMC might also release a statement about its longer-term monetary policy goals and strategy. This would probably involve an explicit--but flexible--inflation target formulated as a headline PCE inflation rate of 2% over the medium term, but with room for significant deviations in the shorter term. We do not view this as a big change relative to the current language about the "mandate-consistent" inflation rate. In order to counteract the impression that this is a "hawkish" shift, we believe the committee would also find a way to strengthen the employment side of the dual mandate, perhaps by talking about a target of zero for the gap between the unemployment rate and its structural level (i.e. the "longer-term" projection in the SEP). It is clear that some type of statement is in the works. However, we do not know whether it will already be released on Wednesday or at a subsequent meeting. The minutes of the December FOMC meeting were noncommittal on timing, and remarks by some Fed officials in the meantime had pointed to a later date. But an article by Jon Hilsenrath in the Wall Street Journal on Friday suggested that the statement might be ready to go after all. Q: What will the forecasts show? A: Our estimates are in Exhibit 1 below: Exhibit 1: Our Estimates for the Fed's Summary of Economic Projections The key point is that while we expect the fed funds rate projections to range quite widely, we think that the median participant will project a funds rate of just 0.75% by the end of 2014 (see Sven Jari Stehn, "Forecasting the FOMC's Forecasts," US Economics Analyst, 12/01, January 7, 2012). This would imply that the median participant expects the first rate hike in 2014. Also, we expect a long-run estimate for the federal funds rate--which may be interpreted as the committee's view of the "neutral" rate--clustered around a median of 4%. Q: What will the statement show? In particular, will the phrase that "economic conditions…are likely to warrant exceptionally low levels for the federal funds rate at least through mid-2013" be retained, expanded, or eliminated? A: We don't expect significant changes in either the growth or inflation paragraphs of the statement. Although the data have been generally stronger than expected, the basic message of "moderate expansion" still looks appropriate. However, we expect the committee to eliminate the "mid-2013" phrase. The whole point of the SEP funds rate projections is that they are a better avenue for providing guidance on future policy than the statement, not that the Fed needs an additional avenue for such guidance (see "Why the FOMC Should Forecast Its Own Policy," US Daily, October 24, 2011): 1. They are more informative than the mid-2013 language because they provide an entire path for the funds rate, not just the timing of the first hike. 2. They are more clearly conditional because the funds rate forecasts are published in the same document as the economic forecasts, which makes it very clear that changes in the latter would cause changes in the former. 3. They provide a more natural avenue for acknowledging both uncertainty and disagreement within the committee, without forcing it to settle on the lowest common denominator. This is a key reason why we think that the projections will show the first hike in 2014, while the FOMC statement was only able to promise no hikes before mid-2013. (Of course, Fed officials have said that even the mid-2013 language is not a full commitment; our view is that it is somewhere in between a commitment and a mere forecast.) In our view, it would be quite problematic to have the SEP projections and the FOMC rate guidance co-exist, as many market participants seem to be expecting. If they are consistent with one another, nothing is gained by retaining both types of guidance. And if they are inconsistent, this could cause great confusion. Q: But wouldn't an elimination of the mid-2013 language from the statement be viewed as a hawkish signal? A: We don't think it should be. All else equal, it is true that a date in the statement is more of a commitment than a forecast path in the SEP, as noted above. But all else is not equal; the SEP is very likely to point to a significantly longer period of near-zero rates than the mid-2013 guidance in the statement. And we do not believe that replacing a slightly stronger (but still conditional) commitment not to raise the funds rate until mid-2013 with a slightly weaker commitment not to raise the funds rate until 2014 would be a net tightening; if anything, we would view it as an easing. That said, there is a timing issue because the FOMC statement is released at 12.30 but the SEP materials do not come out until 2. This could conceivably trigger an adverse market reaction in the short term. We doubt that this looms very large in the minds of Fed officials, but if it is a concern it is possible that the committee will decide to keep the mid-2013 guidance in the statement one last time, and then have the chairman explain in the press conference why it will disappear in the future. Q: Would an elimination of rate guidance from the statement reduce the chairman's influence? A: To a degree, yes, because all FOMC meeting participants including the 7 nonvoting presidents--whose views are on average more hawkish and less aligned with the chairman's--will contribute to the forecasts. We flagged this issue in our October 24 piece and suggested one way to address it, namely to distinguish between the projections of voting and nonvoting participants. Judging from the templates for Wednesday's release, however, Fed officials seem to have decided against such a distinction, probably because it would be too divisive. But we should not forget that the introduction of press conferences has increased the chairman's ability to shape the overall message. If the chairman uses the press conference to shed light on the outlook for the Fed's balance sheet (in advance of the full SEP to be released three weeks later) this will imply a further increase in his ability to shape the message. This puts the partial loss of control over the rate guidance into perspective. Q: How do your expectations stack up against the market's view? A: Our estimate of the median funds rate forecast of 0.75 percent at the end of 2014 is in line with current market pricing. However, it is important to remember that the permanent voters generally hold more dovish views than the rotating voters, and that the Fed's funds rate forecasts are likely to be based on somewhat above-consensus views of the economic outlook. Both of these points suggest that the message about the reaction function might look slightly dovish relative to current market pricing. Against this, however, there are other aspects that might look more hawkish: 1. The "mid-2013" language. The Goldman Sachs US Rates Trading desk conducted a survey of its clients last week in which 82% of respondents indicated that they expect the committee to either retain or expand the "at least mid-2013" commitment in the FOMC statement. In contrast, our expectation ias that they will replace it with the funds rate forecasts. If we are right, some disappointment is certainly possible. 2. The neutral funds rate. We believe the FOMC will show a median estimate of the longer-run funds rate of 4%. In contrast, 72% of survey respondents thought it would be below 4%, and 39% thought it would be below 3.5%. We would be very surprised by such a low number. 3. QE guidance. The Fed seems set to provide less guidance on the outlook for the balance sheet than many market participants are expecting. This may be viewed as a disappointment. 4. The motivation for moving to the new framework. Many market participants seem to believe that the primary motivation is to ease financial conditions. In contrast, our view is that the primary motivation is that Fed officials view monetary policy forecasts as a structural improvement in their communication with the markets and the public. The desire to ease financial conditions probably played a more important role when the move toward the new regime first got underway 3-6 months ago. However, given the improvement in the economic indicators and the easing of financial conditions that has occurred in the meantime, we believe it is less central now. While Fed officials are certainly not targeting a tightening of conditions, we doubt that they will "bend over backwards" to deliver a dovish surprise relative to current market expectations.
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| Gold Next Resistance is Clustered around 1700 Posted: 23 Jan 2012 10:24 AM PST courtesy of DailyFX.com January 23, 2012 02:05 PM Daily Bars Prepared by Jamie Saettele, CMT Gold has exceeded the 50% retracement of the decline from the November top and focus has shifted to a cluster of resistance near 1700. Aside from round number significance, the 61.8% retracement resides near there as do lows from early December. Short term channel resistance is just above 1700. Bottom Line – flat...
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| The Gold Price Reached my $1,680 Target and Should Now Rally to $1,705 Posted: 23 Jan 2012 10:06 AM PST Gold Price Close Today : 1678.00 Change : 14.30 or 0.9% Silver Price Close Today : 3223.30 Change : 58.60 cents or 1.9% Gold Silver Ratio Today : 52.058 Change : -0.512 or -1.0% Silver Gold Ratio Today : 0.01921 Change : 0.000187 or 1.0% Platinum Price Close Today : 1563.70 Change : 33.20 or 2.2% Palladium Price Close Today : 686.05 Change : 12.20 or 1.8% S&P 500 : 1,316.00 Change : 0.62 or 0.0% Dow In GOLD$ : $156.56 Change : $ (1.47) or -0.9% Dow in GOLD oz : 7.574 Change : -0.071 or -0.9% Dow in SILVER oz : 394.28 Change : -7.67 or -1.9% Dow Industrial : 12,708.82 Change : -11.66 or -0.1% US Dollar Index : 79.70 Change : -0.671 or -0.8% Today the GOLD PRICE climbed $14.30 to $1,678.00. The SILVER PRICE tagged right along and ran out front with a 58.6c rise to 3223.3c. GOLD PRICE has now reached my $1,680 target area -- high today hit $1,681.25. Gold's present zeal argues that it will rally to $1,705 at least before pausing. Worth noting is that gold's crucial 150 day moving average stands at $1,681.19 today. As a footnote, the GOLD PRICE also rose above its 50 DMA (1,669.54). Remember that during this bull market gold has only rarely traded below that 150 DMA, and never for a very long time. If it climbs over soon, it may not touch that 150 DMA for a long time to come. The SILVER PRICE has punched through a resistance line within its trading channel, with one clear goal in mind: reach 3400c. Look for it soon. SILVER's 300 DMA, which has been as important to silver as the 150 DMA has been to gold, stands at 3428c today. About the same place stands resistance from last fall's trading. Silver has the bit in its teeth and is running away, above its 20 and 50 DMAs and raging. Keep in mind if you are pondering buying silver or gold that you are not buying for a one or even two or five dollar gain, but a TRIPLE or quadruple. Even a five dollar gain here will look very small in hindsight. Longer you wait to buy, more they will cost. A joke on the streets of Moscow these days: "Everything the Communists told us about communism was a complete and utter lie. Unfortunately, everything the Communists told us about capitalism turned out to be true." Markets have made their intentions considerably clearer today. Dollar's rolling into the gutter again, stocks are indecisive and faltering, gold and silver are shaking off their worries and marching higher. Let's start with the US Dollar Index. Dealing with all these fiat currencies for me is like having to listen to a long lecture on tapeworms and other internal parasites. Thus I want to get it behind me as quickly as possible. What the dollar is losing, the euro is gaining as the frenzied rats, uncertain which ship will sink first, swim from one ship to the other. Here's the answer to their quandary: BOTH are sinking. Dollar index today lost 67.1 basis points, a meaty 0.86%, to grab a branch at 79.704. Falling through the trap door at 80 sends the dollar much lower, and a fall through 79.50 (probably tomorrow) will only tie anvils to the dollar's feet. Dollar's rally is over for a while. Broke clean through the uptrend line, closed below the 20 day moving average (80.53), and has only barely avoided breaking the 50 DMA (79.45). None of this promises anything other than lower prices for the dollar. It has fallen off the kerb into the gutter. Euro meanwhile has a full load on and has posted two gaps up in the last 3 trading days -- breakaway gap, headed for 132+ resistance. Not clear yet how substantial this rally is, or how long it might last. May constitute no more than a rally before one last spike down, but looks good from here. Momentum points skyward as euro has passed its 20 DMA (1.2889) and is drawing a bead on its 50 DMA (1.3163). Euro closed today up 0.77% at 1.3031. Yen did little today, up 0.08% at 129.93c/Y100 (Y76.96/US$1). Above the 20 DMA (129.62) but looking awfully tame. STOCKS today looked lost and bewildered, some indices up, some down. Confusion promises nothing good as stocks run out of enthusiasm and steam. Dow fell 11.66 (0.09%) to 12,708.82. Broader S&P500 rose 0.62 (get out the magnifying glass) or 0.05% to 1,316.00. Dow acting allergic to 12,750. Last high close came 2 May 2011 at 12,810. That is now doing the same thing to the Dow that Kryptonite does to Superman. S&P500 is also struggling at analogous downtrend line from 29 April 2011 close at 1,363.60. Don't expect either index to reach those last high levels. This will bring great pain to many, and I take no pleasure in reporting it. Stocks are in a primary down trend, and have much, much further to fall in the years before that bear market ends. 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: 23 Jan 2012 09:40 AM PST [url]http://www.traderdannorcini.blogspot.com/[/url] [url]http://www.fortwealth.com/[/url] Gold has made it into a formidable resistance level near $1680 which has served to bring out some heavy selling, just as expected seeing that a breach of this defensive line by the bulls will set the market for a run to $1700 and higher. Gold bears can read the charts just as we can and understand what will bring in the momentum buyers if they fail to hold it here. If the recent price advance falters here at this critical zone, then we will see a setback towards $1650 - $1645 initially followed by a bit deeper drop to $1620 or so if the dip buyers are a bit sluggish in making their appearance. On the topside, a push through $1700 sets this market on a course to challenge $1720 - $1725, above which lies much stronger resistance just above $1750, a level which I might add, needs to be taken out to accelerate the recent move higher. Risk trades continued today with the Dollar seeing some sell...
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| Resource Clips interview with GATA: No more tinfoil hats Posted: 23 Jan 2012 09:33 AM PST 2:30p PT Monday, January 23, 2012 Dear Friend of GATA and Gold: Kevin Michael Grace of Resource Clips interviewed GATA Chairman Bill Murphy and your secretary/treasurer yesterday during the Vancouver Resource Investment Conference. The interview is headlined "No More Tinfoil Hats" and it's posted at Resource Clips here: http://resourceclips.com/2012/01/23/no-more-tinfoil-hats/ CHRIS POWELL, Secretary/Treasurer 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 Join GATA here: 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 Prophecy Coal (TSX: PCY) Wins Positive Feasibility Study Company Press Release VANCOUVER, British Columbia, Canada -- Prophecy Coal Corp. (TSX: PCY, OTCQX: PRPCF, Frankfurt: 1P2) has received a positive feasibility study for the company's 600-megawatt Chandgana Mine-Mouth Power Project in central Mongolia. The report was independently prepared by Ralf Thomsen, project manager at Steag, a German firm specializing in the planning, financing, construction, and operation of highly efficient thermal power plants for fossil fuels. The study covers technical specifications, deployment, and financial analysis of a 4x150-mw thermal power plant to be built adjacent to Prophecy's Chandgana Tal coal deposit, which contains 140 million tonnes of measured coal. Last year the power plant received a construction license and the coal deposit received a mining license. Engineering, procurement, and construction management selection and project financing discussion have begun and are expected to be concluded this year. Construction is planned to start in April 2013, with the first 150-mw unit being commissioned in October 2015 and subsequent units to start in April 2016, October 2016, and April 2017. With proper maintenance the project will have 30 years of commercial operation. For the complete statement from the company, including maps and charts, please visit: http://www.prophecycoal.com/news_2011_jan17_prophecy_receives_power_plan...
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| Posted: 23 Jan 2012 09:32 AM PST www.preciousmetalstockreview.com January 21, 2012 We had a super week in regard to swing trading as markets and stocks did what the charts said they were going to, now it looks like we need at least a few days of correcting and backing and filling before we attempt a new move higher but it was very nice to see the S&P move beyond 1,300. Ideally I’d enjoy seeing the 1,300 area on the S&P tested again this week. As for the precious metals they're doing well, especially silver and palladium but just because gold isn’t really moving up doesn’t mean it’s sick. Metals review Gold rose 1.51% this past week and is now trading within an uptrend channel which is now at resistance. The 50 day moving average is right here along with the $1,675 horizontal resistance level and the downtrend line. All in all the signs are pointing to a rest for gold here. This could last at least three days or up to a week or sli...
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| Volume Crashes As Stocks End Unchanged Posted: 23 Jan 2012 09:19 AM PST Amid the lowest NYSE volume of the year (-24% from Friday - OPEX) and pretty much the lowest non-holiday-period volume in 9 years based on Bloomberg's NYSEVOL data, ES (the e-mini S&P 500 futures contract) ended the day almost perfectly unchanged underperforming 5Y investment grade and high-yield credit indices on the day as both moved to contract tights (their best levels since early August last year) even as their curves flattened. There has been lots of chatter about how the steepening of the short-end of the European sovereign bond markets (Italian 2s10s for instance) is a sign that all-is-well in the world again, well unfortunately the flattening of the short-end of US IG and HY credit markets sends a rather less positive signal than headlines might care to admit (as jump risk in the short-term remains 'high' relative to bullish momentum in the medium-term). At the same time, vol markets are showing extreme levels of short-term complacency as 1m VIX is almost at record low levels relative to 3m VIX (and diverging today from implied correlation). Broadly speaking , risk assets rallied into the US day session open only to sell off into the European close (with Sovereigns leaking back the most). The afternoon saw risk rallying as the path of least resistance appears to be up all the time there is no news. Stocks ended well off their highs of the day, in line with broad risk assets, as TSY yields rose 3-4bps higher, Oil and Copper 1.5-1.75% higher (outperformed) while Silver and Gold hugged USD weakness at around a 0.5% gain from Friday's close.
With a third of the quarter already done, this is shaping up to be an even worse quarter for banks that Q4. With trading volumes so far this year 18% lower than the Q4 (ex-Xmas), we can only assume that what they lose in volume they make up for in margin so expect your bid-offer spreads to widen (viciously exaggerating the decline in trading volume we suspect). The chart above shows the mind-blowingly bad NYSE stock volume appears to be the lowest non-holiday period trading volume we have seen in 9 years (or the data that we have from Bloomberg).
After tracking closely for the last few days, ES limped off into the close today as IG (investment grade) and HY (high yield) credit rallied on to close at five-month tights. HYG (the high yield bond ETF) gave some back at the close. ES downward reversion at the close pulled it to close at its VWAP suggesting very little aggressive positioning today though volume was heaviest as we sold off (from 10ET to 12ET) after which (the EU close) we leaked higher.
Under the surface, the bullish moves in credit spreads (which are undoubtedly positive) have the IG (above) and HY (below) credit indices trading at multi-month 'flat' levels. Typically we would expect a credit rally to be led by the front-end as default risk (liquidity-aided) dries up and we see jump risk removed from the market (also these shorter-dated maturities have lower durations and some risk control - though technicals can make them less liquid). In this rally we have seen the curve flatten (a more bearish move) suggesting that the exuberance that 5Y spreads have enjoyed (purple), both now trading extremely rich (tight) to where their underlying portfolio would suggest is fair (lower pane shows just how rich IG and HY are in 5Y and not in 3Y), is yet another reflection of complacency.
The skews will help understand: 5Y HY is 34bps rich (expensive to its portfolio's value) while 3Y HY is about 10bps cheap (wide) and in IG it was even more interesting with 5Y around 11bps rich ( a huge difference at around 10% of the index - equivalent to the S&P 500 trading at 1400 while the underlying stocks of the S&P 500 imply a fair-value of only 1260) while the 3Y IG is trading 4bps cheap (wide) of its fair-value. The point is that understanding what is going on across the credit curve and indices relative to their underlying value suggests that professionals are positioning far less bullishly than 'opticals' would suggest (just as we noted last week in equity options skews, implied skewness, and kurtosis) and also below in volatility term structure steepness.
The chart shows the steepness of 1m implied vol over 3m implied vol. The lower the chart, the steeper the term structure and the more complacent short-dated volatility becomes relative to medium-term vol. The option expiration on Friday has an impact but we see almost record levels of relative complacency in short-term options vs medium-term. We find it fascinating that Goldman publishes a paper to push buy-write strategies at the same time as short-term vol is so low (if we were a suspicious, we would guess that GS got loaded with hedgies selling vol - covered calls - and were looking to unload some of that exposure to others). Of course, we could also be seeing event risk hedging across the Greek bond maturities in March by selling short-term vol to pay for vol that is the other side of this huge event.
FX markets were typically more active during the European day session and were relatively calm as Europeans and Asians left the market. EURUSD held above 1.30, Cable underperformed (the only major weaker against the USD) as JPY was very quiet. GBP and JPY's underperformance helped DXY outperform EUR for a change as the USD proxy only lost 0.5% from Friday.
Commodities separate this afternoon into 'fiat-related' and 'economic' as it were with Gold and Silver outperforming in line with USD's weakness (after some early exuberance in Silver) while Copper and Oil stayed together and outperformed as the latter toyed with $100 once again.
Charts: Bloomberg
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| Juan Ramón Rallo and Alasdair Macleod talk about the Spanish economy, gold and silver Posted: 23 Jan 2012 09:15 AM PST In this video Juan Ramón Rallo, economist and university professor in Madrid, and Alasdair Macleod of the GoldMoney Foundation talk about the Spanish economy, gold and silver. Rallo sees growing ...
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| Greek Debt Deal Rejected As S&P Begins European Bank Downgrades Posted: 23 Jan 2012 08:58 AM PST At least they were kind enough to wait until the close:
But, but, Marathon promised... And making things even worse, here come the long overdue European S&P bank downgrades
Sarc-o-bot (that's Sarcasm, not Sarakozy) screaming: "This is all priced in. Buy buy buy."
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| Posted: 23 Jan 2012 08:45 AM PST Doug: Stating that the US is turning into a police state when you started this conversation was quite accurate. You can see more and more videos spreading over the Internet, not just of police brutality, but demonstrating the militarization and federalization of police, who are being inculcated with both disdain for and paranoia about ordinary citizens. In the old days, if you were stopped for speeding, the peace officer was polite — you could get out of your car, meet the cop on neutral ground, and chat with him. You didn't have a serious problem unless you were obviously drunk or combative. Now, you don't dare make a move. You better keep your hands in plain sight on the steering wheel and be ready for a Breathalyzer test without probable cause. The law enforcement officer will stand behind you with his hand on his gun. And you're the one who'd better be polite. L: There has been a polar reversal. The cops used to address citizens as "sir" or "ma'am." Now, the correct response in a traffic stop is: "Yes, sir! I would love to inspect the bottom of your boot, sir!" Doug: [Laughs] That's right. My friend Marc Victor gives out magnetized business cards. People ask, "Why?" He answers that it's so clients can put them on the bottom of their cars or refrigerators, so they can see it when the cops throw them to the ground. L: Marc's a good man. There's a handy video on Marc's website, offering advice on what to do if you're pulled over by the police in a traffic stop. Doug: A good public service announcement. At any rate, I think there's no question that the US has turned the corner on every basis: politically, socially, morally, and now, economically… L: Okay, but, Doug, you said that in 1979 too. The question is, how do we know when the door is going to close? Doug: [Laughs.] Well, sometimes I feel a little like the boy who cried wolf. But Roman writers like Tacitus and Sallust saw where Rome was going before it got completely out of control. Should they have said nothing, for fear of being too early? Here in the US, it should have gone over the edge back in the 1980s, but we got lucky. There was still a lot of forward momentum, which can last for decades when you're speaking of civilizations. There was the computer productivity boom. The Soviet Union collapsed, China liberalized, and Communism was discredited everywhere except on US college campuses. The end of the Cold War opened up vast areas of the world to the global market. And most surprising of all, Volcker tightened up the money supply and interest rates went high, causing people to save money and stop borrowing to consume. L: That's not happening this time. Doug: No. We got lucky back then. Since the '90s we've had a long and totally phony, debt-driven boom that's now come to an end. I feel very confident that there's no way out this time. There are huge distortions and misallocations of capital that have been cranked into the system for two decades. And not just in the US this time, but in Europe, China, Japan, and elsewhere. The US is very clearly on the decline. The fact that in spite of bankrupting military expenditures to no gain for the American people, those in power are talking overtly and aggressively about attacking more countries — Iran and Pakistan in particular — is extremely grave. The fact that they attacked Libya — which, incidentally, is going to turn into a total disaster, a civil war that will last for years — shows it's not stopping. Sure, Obama brought troops home from Iraq — another disaster that's going to remain a disaster for years to come — but at the same time he put a company of combat troops in Uganda, of all places and Marines in Australia, to provoke the Chinese. Back home, I've read reports that people are being stopped for carrying gold coins out of the US, in Houston in particular. Now we have authorization of the military to detain US citizens, on US soil, with no trail, and indefinitely, on the verge of becoming law. And Predator Drones have been used to hunt down farmers on their own ranches. I could go on and on. This is not like spotting early signs of decay in America's expansionist wars of the 19th century or things getting worse with FDR. Most people can't see it with all the noise and confusion, but we've reached the edge of the precipice. L: Don't worry about exactly where the edge is, just assume it's there and take appropriate action? Doug: Yes. It really is there. It's a clear and present danger. But most Americans are as oblivious as most Germans were in the '30s. In fact, most of them support what's going on, just as most Germans supported their government in the '30s and '40s. L: So… don't worry about figuring out exactly when the gates will shut. Assume they are shutting now? Doug: That's right. One should be actively and vigorously looking to expatriate assets, cash, and even one's self. A prudent person will always be diversified politically and internationally. L: What about people who have jobs they can't continue doing from abroad and who need the income? Doug: They should still prepare, as best they can, to be ready to go on a vacation when things get hot — a vacation from which they might not return for a long time. All that needs happen, with the hysteria that's building in the US, is for a major terrorist incident — real or imagined — to occur. Homeland Security will lock the country down. Look, I know it sounds extreme, and the comparison to pre-WWII Germany has been made many times, but it bears repeating. Germany was the most literate, civilized, and even mellow, in some ways, country in Europe. It was much admired all around the world — a nation of shopkeepers, small farmers, and scholars. But the whole character of the place started changing in 1933, and it just got worse and worse. By the end of 1939, if you weren't out, you were done. L: [Pauses] Well, not a cheerful thought. Actions to take? Doug: Things we've said before: Set up foreign bank accounts in places you like to travel, while you can. Set up vault arrangements for physical precious metals outside the US. Buy foreign real estate that you'd like to own, because it can't be forcibly repatriated. Offshore asset protection trusts are a good idea too. Become an International Man. Let me emphasize that US taxpayers should stay within all US laws, because the consequences of breaking them are unbelievably draconian. Generally, one simply must internationalize one's assets. The biggest danger investors face, by far, is not market risk — huge as that will be — but political risk. The only way to insulate yourself from such risk is to diversify yourself politically and geographically. L: Right then… words to the wise. Thanks for your insight. Doug: You're welcome. Doug Casey and Louis James Getting out of Dodge, Part II 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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| America: "Still the Place to Be" Posted: 23 Jan 2012 08:40 AM PST January 23, 2012 [LIST] [*]Does the iPhone prove that "Made in America" is passe? Contrary evidence abounds... [*]How the U.S. is already leading a manufacturing revival in the developed world... and why it's about to be turbocharged in only four more months [*]An unlikely impediment to public acceptance of the gold standard: Ron Paul and "the Curse of Knowledge" [*]Lambs to slaughter: More money floods into munis and high-yield bonds. Jim Nelson on the next (much-safer) beneficiary [*]A "very bullish signal" for stocks... China's next big resource grab... a reader's call to boycott Hollywood... and more! [/LIST] One thing we love about The New York Times and the mass media: They're always so on top of things. This weekend, the Gray Lady regaled the world with a tale of American manufacturing being, gasp, over the hill and behind the eight ball. "Apple's executives," the rag reported, "believe the vast scale of overseas factories as well as the flexibility, di...
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| Look for Gold Juniors with Theme-Changing Catalysts: Annie Zhang Posted: 23 Jan 2012 08:30 AM PST The Gold Report: The bottom fell out of the junior precious metals sector in late 2011. Why should investors believe that this sector is going to perform better this year? Annie Zhang: In 2011, gold was up by about 10%, while gold equities underperformed as investors became more risk averse. Junior exploration companies were beaten down pretty badly. We continue to hold a bullish view on gold, but we think 2012 is going to be a volatile year. Good stories with theme-changing catalysts will outperform in 2012, however. For example, Mega Precious Metals Inc. (MGP:TSX.V) is coming out with a resource update for the Monument Bay project in Manitoba. This resource update will outline for the first time the open-pit resource potential, which will significantly derisk the project and potentially improve the economics. Premier Gold Mines Ltd. (PG:TSX) will come out with its preliminary economic assessment (PEA) on the Hardrock deposit, which is part of its Trans-Canada project in Northwes...
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| Gold Daily and Silver Weekly Charts Posted: 23 Jan 2012 08:13 AM PST |
| Eveillard: ‘We are Headed for Enormous Inflation & Higher Gold' Posted: 23 Jan 2012 08:12 AM PST With advancing to the $1,680 level and silver firmly above $32, today King World News interviewed legendary value investor Jean Marie Eveillard, who oversees $50 billion at First Eagle Funds. KWN wanted to get Eveillard's thoughts on gold and global money printing. When asked about the continued money printing, Eveillard stated, "What we already had was the fact the Federal Reserve was printing money and the Bank of England was printing money. Now you have the European Central Bank, in an indirect manner, is also printing money. They have made enormous amounts of money available to commercial banks, from the European Central Bank, for the next 3 years on very cheap terms."
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| Von Greyerz - Gold Breaking Out, Will Hit New All-Time Highs Posted: 23 Jan 2012 07:09 AM PST  With gold attacking the critical $1,680 level and silver remaining strong above $32, today King World News interviewed the man who told clients in 2002, when gold was $300, to put up to 50% of their assets into physical gold. Egon von Greyerz is founder and managing partner at Matterhorn Asset Management out of Switzerland. When asked about the recent action in gold, von Greyerz said, "Sometimes we get lucky with our calls. I called the bottom of gold when we talked around the end of December. When we spoke last week I said it looks to me like silver is going to break out here and this is exactly what is happening. This is very good action and it's as we expected."
This posting includes an audio/video/photo media file: Download Now |
Ron Hera and I are live on the floor at the Vancouver Resource Investment Conference. There were over 500 companies exhibiting and Ron says that in 5 years, half of them won't exist. Ron explains that for a mining venture to be successful you need three things, experienced management with a track record, a property with decent ore grade and proximity to good infrastructure. Of course capital is required, but without these three important elements, you won't have to worry about raising money because there won't be any.
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