Gold World News Flash |
- Let me ask you...
- Gold Bubble? Huh?
- Silver Update 2/21/12 Greece or Iceland
- Chinas "Mystery" Gold Buyer
- Gold Seeker Closing Report: Gold and Silver Gain Over 2% and 3%
- The Fight of the Century
- WealthCycles: Overt Currency Printing - Round 3
- The Long-Term Fundamental Case for Gold
- Overt Currency Printing – Round 3
- Harvey Organ's Daily Gold & Silver Report
- The Golden Angels
- Gloves About To Come Off In Silver?
- TF Metals Report: Even More Charts
- Norcini, Rule, and Farage interviewed at King World News
- Greek Debt Situation is Solved - Gold & Silver Up - EU Dislikes Canadian Oil Sands
- Will the Greek Bailout Make Gold, Silver Rise or Fall?
- GATA Chairman Murphy interviewed by Kitco at California conference
- Evidence of Market Manipulation in The Financial Crisis
- SilverDoctors and Eric Sprott
- Nigel Farage - Catastrophe Imminent & Gold to Break $2,500
- Marc Faber - The Timing of the Collapse
- The Ultimate Quadruple-Top Breakout
- 8 Reasons Why The Greek Debt Deal May Not Stop A Chaotic Greek Debt Default
- Stocks Plunge (Open-To-Close) As Commodities Outperform
- The Gold Price has the Wind in it's Sails Knocking Down Resistance Through $1,750 Can it Close Higher Still Tomorrow?
- As US Debt To GDP Passes 101%, The Global Debt Ponzi Enters Its Final Stages
- Federal Reserve Driven Inflation Hurts Savers
- Ron Hera Likes Gold, Silver, Limited Government & Individual Rights–02-21-2012
- Guest Post: The Great Repression
- TF Metals Report: Gold & Silver Looking Good; Caution Warranted
| Posted: 21 Feb 2012 07:47 PM PST If you were to ask 100 people TODAY what Gold or Silver closed at, how many would know the answer?
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| Posted: 21 Feb 2012 07:47 PM PST
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| Silver Update 2/21/12 Greece or Iceland Posted: 21 Feb 2012 07:42 PM PST
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| Posted: 21 Feb 2012 05:01 PM PST Bullion Vault
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| Gold Seeker Closing Report: Gold and Silver Gain Over 2% and 3% Posted: 21 Feb 2012 04:00 PM PST Gold rose $11.50 in holiday thinned trade on Monday and climbed over $25 more to as high as $1759.90 in New York today before it fell back off a bit in late trade, but it still ended with a gain of 2.14% from Friday's close. Silver gained $0.41 on Monday and rose to as high as $34.442 today before it also fell back off a bit, but it still ended with a gain of 3.56% from Friday's close.
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| Posted: 21 Feb 2012 03:20 PM PST  As economies contract, a global popular uprising confronts power elites over access to the essentials of human existence. What are the underlying dynamics of the conflict, and how is it likely to play out?1. Prologue As the world economy crashes against debt and resource limits, more and more countries are responding by attempting to salvage what are actually their most expendable features—corrupt, insolvent banks and bloated militaries—while leaving the majority of their people to languish in "austerity." The result, predictably, is a global uprising. This current set of conditions and responses will lead, sooner or later, to social as well as economic upheaval—and a collapse of the support infrastructure on which billions depend for their very survival. Read more.... 
This posting includes an audio/video/photo media file: Download Now | ||
| WealthCycles: Overt Currency Printing - Round 3 Posted: 21 Feb 2012 02:44 PM PST Exchanging dollars & other currencies for gold & silver should be at the very top of the priority list, prior to the "devaluation [which] itself can be beneficial."
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| The Long-Term Fundamental Case for Gold Posted: 21 Feb 2012 01:58 PM PST A quick glance at most of the headlines over the weekend and the primary focus seemed to be either calling a near term top in domestic equity indices or a focus on the Greek debt situation. Why is anyone even paying attention to ... Read More...
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| Overt Currency Printing – Round 3 Posted: 21 Feb 2012 01:57 PM PST from WealthCycles:
The Federal Reserve holds eight regularly scheduled meetings annually, and other emergency meetings as needed. These meetings are where the carefully crafted Fedspeak message is painstakingly explained for us rubes. We believe that there is a clear difference between overt printing of currency and the stealth inflation we have seen in the interim. In the January meeting, we learned that the Federal Reserve wanted to set expectations for interest rates to remain near zero for at least another year beyond the earlier projection, to 2014. Setting this expectation encourages further misallocation of resources that would have otherwise been invested in more productive development of our economy. WealthCycles previously detailed the zero interest rate policy (ZIRP) in this feature. Moreover, the policy allows the precarious currency system to remain functional. Imagine if the United States actually had to pay real rates of interest on its massive national debt? We would simply not have the tax revenues to do so. Extreme low interest rates are the only thing holding back the U.S. and financial institutions globally from bankruptcy today.
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| Harvey Organ's Daily Gold & Silver Report Posted: 21 Feb 2012 01:30 PM PST Greece "rescued" as Europe forges a deal/Gold and silver advance in price/4.2 million oz of silver standing in Feb
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| Posted: 21 Feb 2012 01:24 PM PST My Dear Friends, The Angel at $1764 is very real, not only as a price magnet, but in implications of surpassing it for a second time. Expect a war at Angel $1764. Expect it to be surpassed in time. The gold bears are bonkers. The ones that know it has much higher price Continue reading The Golden Angels
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| Gloves About To Come Off In Silver? Posted: 21 Feb 2012 01:23 PM PST Where do we go from here? The panic buying begins, or what I have described in the past as the "gloves coming off" when silver breaches $37.5/oz
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| TF Metals Report: Even More Charts Posted: 21 Feb 2012 01:18 PM PST The real battles begin when gold reaches 1800 and silver reaches 35.50. These are The Battles Royale.
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| Norcini, Rule, and Farage interviewed at King World News Posted: 21 Feb 2012 01:12 PM PST 9:12 ET Tuesday, February 21, 2012 Dear Friend of GATA and Gold: Who needs The Wall Street Journal when there's King World News? Market analyst Dan Norcini thinks oil will rise and help pull gold up: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/2/21_No... Brokerage house manager Rick Rule sees Europe continuing to create gobs of money for bailouts: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/2/21_Ru... And European Parliament member Nigel Farage deplores the misery being inflicted on Greece to rescue irresponsible banks: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/2/21_Ni... CHRIS POWELL, Secretary/Treasurer 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... Join GATA here: Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006: http://www.goldrush21.com/order.html 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 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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| Greek Debt Situation is Solved - Gold & Silver Up - EU Dislikes Canadian Oil Sands Posted: 21 Feb 2012 01:11 PM PST RNN Midday News for Tuesday February 21 discusses the Greek Debt situation, the current price movements in Gold & Silver, the Iranian move to ban oil exports
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| Will the Greek Bailout Make Gold, Silver Rise or Fall? Posted: 21 Feb 2012 01:00 PM PST Some investors may feel that the Eurozone debt crisis has been resolved by the bailout from the other E.U. members. Whether it has or has not, is irrelevant to the price of gold, or is it? There are still hurdles in the way, such as the acceptance by private Greek Bondholders of the 53% haircut and low interest rates they will get until 2015. But let's assume the best and believe they'll accept the terms. The first market reactions were to move up and hold new levels without any effervescence in any market. The moves had largely been discounted already. Yes, we're seeing a shift of money from the U.S. Treasury market to the euro but not in large amounts yet. In this piece we look at the overall prospects for the precious metals.
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| GATA Chairman Murphy interviewed by Kitco at California conference Posted: 21 Feb 2012 12:22 PM PST 8:18p ET Tuesday, February 21, 2012 Dear Friend of GATA and Gold: Tommy Humphreys of Kitco and Cambridge House interviewed GATA Chairman Bill Murphy two weekends ago during the California Investment Conference in Indian Wells. They discussed GATA's past and future and you can watch the video of the interview, No. 2 in a series, at Kitco here: http://www.kitco.com/events/2012/cambridgehouse/california/ CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT A Rare Opportunity with Collectible Gold Coins Sovereign debt problems in the United States as well as Europe will worsen this year. The mainstream financial media may never report about the likely inflationary consequences of bailouts and "quantitative easing," nor are they likely ever to recommend tangible assets for financial protection. But at Swiss America Trading Corp. we believe that it is no longer a luxury to own gold and silver coins but rather a necessity. At the moment the public is showing little interest in Double Eagle U.S. $20 gold coins, so the price premiums above the intrinsic melt values (.9675 ounce of gold in each coin) are historically low. The ratio of price to bullion content for these coins has been 2:1 but today it is only about 1.25:1. This is a real opportunity. So give us a call or e-mail and we will be glad to discuss the potential of these coins and how to use a ratio strategy to increase your gold ounces without money out of pocket. In the January edition of his Early Warning Report, Richard Maybury writes: "As they are inherently in very limited supply, I believe that high-quality numismatics will become tulips, eventually rising a thousand percent or more in real terms, when money velocity goes into mid-second stage. In late stage, who knows -- 2,000 percent? 3,000?" All inquiries will receive without charge (while supplies last) our latest book, "The Inflation Deception," as well as our newsletter "Real Money Perspectives." -- Tim Murphy, trmurphy@swissamerica.com -- Fred Goldstein, figoldstein@swissamerica.com Telephone: 1-800-289-2646 Swiss America Trading Corp., 15018 North Tatum Blvd., Phoenix, AZ 85032 Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006: http://www.goldrush21.com/order.html 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 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 Free Month Subscription to Market Force Analysis for GATA Supporters Market Force Analysis is a unique, patent-pending approach to commodity market analysis. An algorithm has been developed to extract supply and demand weightings from futures market data. The difference between supply and demand is the market imbalance that is called "market force," so named because it is what drives price. It brings clarity to past market action and predicts market trends. Because it is derived from accurate futures market data it is not subject to the errors inherent in macro-level estimates of supply and demand. Learn more here: https://marketforceanalysis.com/About_MFA.html Market Force Analysis focuses on short-term (15 days) and medium-term price predictions to help both short-term traders and long-term investors understand market moves and benefit from the generated prediction of prices. To read subscriber comments that show how much the service is appreciated, visit: https://marketforceanalysis.com/Testimonials.html The MFA service has been pioneered by market analyst and Gold Anti-Trust Action board member and researcher Adrian Douglas. The Market Force Analysis premium service provides: -- A bi-weekly report. -- Access to the MFA hot list of junior mining stocks derived from analysis of more than 800 mining stocks. The MFA hot list consistently outperforms well-known mining share indices like the HUI, GDX, and GDXJ. -- E-mail alerts about actionable trades. -- E-mail updates with important information. To obtain your 1-month free trial subscription to the Market Force Analysis letter, e-mail info@marketforceanalysis.com and put "MFA Free Trial" in the subject field.
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| Evidence of Market Manipulation in The Financial Crisis Posted: 21 Feb 2012 11:43 AM PST | ||
| Posted: 21 Feb 2012 11:36 AM PST [Ed. Note: Related.] from SilverDoctors: Part 1: Eric Sprott: One of My Aims in Life is to Have a Silver Issue Where I Can't Source the Last Bar With the Greek crisis nearing a climax, The Doc spoke with Eric Sprott of Sprott Asset Management this week to discuss the Euro debt crisis, silver fundamentals, and the sourcing of silver for the PSLV's recent $350 million follow-on offering. Eric also discusses his goal in life to have a silver issue where he is unable to source the last bar, his attempts to convince silver mining companies to understand and believe in their own products, as well as his efforts to convince hedge funds and institutions to consider the silver market.
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| Nigel Farage - Catastrophe Imminent & Gold to Break $2,500 Posted: 21 Feb 2012 11:21 AM PST The downside risks for the banking sector are still absolutely enormous & therefore the knock-on effect on gold is huge.
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| Marc Faber - The Timing of the Collapse Posted: 21 Feb 2012 11:16 AM PST The situation is the same here in the US. They are never going to address the problems, only the symptoms.
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| The Ultimate Quadruple-Top Breakout Posted: 21 Feb 2012 11:07 AM PST by Andrew Hoffman, MilesFranklin.com:
On a quiet day here in the States – with nearly all markets closed for President's Day – I want to take advantage of the "relative peace" to hammer home one of the MOST IMPORTANT INVESTMENT THEMES OF OUR LIFETIME. I spend 99% of my time writing about the need to think defensively, i.e. not of increasing one's wealth but protecting it – although owning PHYSICAL gold and silver will certainly achieve both targets. However, I still have two decades of financial markets in my blood, and thus it is hard to suppress my excitement about the inevitable silver breakout to all-time highs, in what will historically be viewed as the ULTIMATE TRIPLE-TOP BREAKOUT. Gold may be the "linchpin" of the global financial system, but silver is the hare-trigger due to its equally established monetary history, tiny market size, and lack of above-ground inventory. That is why PAPER silver has been so maniacally suppressed since the gold standard was abandoned in 1971, the systemic "Achilles Heel" that will no doubt "break the Cartel's back." Not only is silver among the scarcest elements on Earth – prompting the U.S. Geological Service (USGS) to recently predict it would be the first extinct element – but investment and industrial demand are both growing exponentially.
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| 8 Reasons Why The Greek Debt Deal May Not Stop A Chaotic Greek Debt Default Posted: 21 Feb 2012 11:04 AM PST from The Economic Collapse Blog:
Read More @ TheEconomicCollapseBlog.com
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| Stocks Plunge (Open-To-Close) As Commodities Outperform Posted: 21 Feb 2012 11:01 AM PST Silver outperforming (up 3.3% since Friday's close already), WTI managing $106 intraday & Gold touching $1760 (both up over 2% from Friday)
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| Posted: 21 Feb 2012 10:42 AM PST Gold Price Close Today : 1757.10 Change : 32.60 or 1.89% Silver Price Close Today : 3441.30 Change : 121.3 cents or 3.65% Gold Silver Ratio Today : 51.059 Change : -0.884 or -1.70% Silver Gold Ratio Today : 0.01959 Change : 0.000333 or 1.73% Platinum Price Close Today : 1687.10 Change : 49.10 or 3.00% Palladium Price Close Today : 710.60 Change : 15.60 or 2.24% S&P 500 : 1,362.21 Change : 0.98 or 0.07% Dow In GOLD$ : $152.54 Change : $ (2.68) or -1.73% Dow in GOLD oz : 7.379 Change : -0.130 or -1.73% Dow in SILVER oz : 376.77 Change : -13.29 or -3.41% Dow Industrial : 12,965.69 Change : 15.82 or 0.12% US Dollar Index : 79.06 Change : 0.115 or 0.15% Last three days of last week silver and the GOLD PRICE steadfastly refused to drop further, even though gold hit a low of $1,705.60 on 16 February -- and then closed $21 higher. Now we are left with the interpretation that both have been undergoing a correction within a rally, that the rally ain't over yet, and that gold will reach $1,805 or higher before the rally ends and a bigger correction sets in. The GOLD PRICE today closed a little higher than its last peak, up $32.60 to $1,757.10 (versus $1,756.80 at the 2 February peak, when all this fun began). On Friday it closed at $1,724.60, so it knocked down all the gates of resistance around $1,730, $1,740, and $1,750. Hard to imagine that it won't follow through tomorrow with a higher close still. It closed near the high for the day ($1,759.43). Only thing that could gainsay higher prices and a continuing rally would be a close below $1,725 tomorrow. Otherwise gold has the wind in its sails. Gold leapt 1.9% but the SILVER PRICE pulled on its 7-league boots and vaulted 3.7%! High came at 3445c, and silver closed near that at 3441.3c, up 121.3c. Low last week arrived on Thursday at 3262c, then over the next three days the SILVER PRICE kept bouncing against 3360c, like a helium balloon patting on the ceiling. Once it cleared 3380c in Europe, it was bound to break 3400c and run higher in the US. Pointing to better things still, silver has now reached its 300 day moving average (3468c) once again. 200 DMA is not much higher at 3495c. When silver crosses that line, buyers will pile on. Silver has in it 3570c at least, and maybe 3900c. Unless contradicted by lower closes tomorrow, gold and silver will move higher. On Friday, 24 February, I will be speaking for the Fayette County (Tenn.) Tea Party at the Fayette County Courthouse, in the town square at Somerville, Tennessee. Party starts at 7:00 p.m., and the topic will be "Restoring Freedom by Rebuilding Local Economy." This may be your only chance to see a natural born fool from Tennessee live and outside captivity. When you put three men all anxious to get home to their wives in a car, you throw the brains right out the window. We started out from Houston Friday at 2:00 p.m. and arrived at my house at 5:30 a.m. Brainless. Looking at markets, you can't afford to wear blinders. You have to look at markets that feed back on each other, and inwardly you have to look at more than a market's close. If something doesn't fit, that's probably because it really doesn't fit, and something is up. Today, it appears for the nonce, that Greek Debt Deal was finally accepted. Just wait to see how permanent that is. Reports I hear from Greece indicate a level of economic suffering that can't be maintained. Today came the answer to my riddle last week, Why have silver and gold not fallen further, following through on their repulse at $1,750? Answer is, Because they are strong, and haven't yet completed the upward move that began from the 29 December bottom. Today the headlines crowed that the Dow hit 13,000, and it did, 13,005.04 as a matter of fact, highest since May 2008, but -- whoops! -- it didn't close near there. Meanwhile, if you merely glance at today's chart, you will notice that the Dow climbed up a mountain, then fell off the mountain from about 1:30 onwards, closing at 12,965.69, up only 15.82 points (0.12%) and 40 points lower than the high. Now glance over at the Dow in Gold Dollars, and you'll see that it in fact DROPPED G$2.68, about an eighth of an ounce and way below the last high. Meanwhile, the S&P500 rose 0.98 point, a noteworthy 0.07%, to 1,362.21. Now I will give y'all that if the Dow intended to clear 13,000, it might first bounce off and try again, but today's chart indelibly resembles a market running clean out of steam and fainting. I also wonder why amidst this general jubilating the NASDAQ dropped 0.11% and the Russell 2000 dropped 0.7%. Not everybody in the choir is singing the same tune. Why not? The US dollar index gave up 11.5 basis points (0.15%) to close 79.058, down over 50 basis points from a week ago. The euro gained 0.75%, but the jubilators might want to notice that price didn't reach the last peak, which it must BEST to rally further. The yen has spent the last three weeks dropping. Today it dropped another 0.21% to 125.46c/Y100 (Y79.71/US$1). Being no more than a natural born fool and not one of them genius economists, I am plain bumfuzzled by the popular belief that when the US dollar drops, it is good for stocks. But wait. If the dollar drops, that signals inflation or some monetary problem, and that introduces confusion into the entire economy, so explain to me exactly why the dollar dropping is good for stocks? On 21 February 1848 the Communist Manifesto, written by Karl Marx and Friedrich Engles, was published in London. Hard to recall any other document from history that has shed so much blood. However, I find it wryly amusing, in a sort of gallows-humor way, that in supposedly capitalist and anti-socialist America, all ten planks of the Communist Manifesto are written into law and daily practiced, to wit: 1. Abolition of private property and application of all rents of land to public purposes. If you believe you own property, just ignore the property tax bill and see if the real owner doesn't show up. And, what's that thing called "zoning"? 2. A heavy progressive or graduated income tax. 3. Abolition of all rights of inheritance. We call it an estate tax. 4. Confiscation of the property of all emigrants and rebels. We call it government seizures, tax liens, and anti-terrorism laws. 5. Centralization of credit in the hands of the state by means of a national bank with State capital and an exclusive monopoly. Behold, I give you the Federal Reserve system. 6. Centralization of the means of communication and transportation in the hands of the State. Think FCC and DOT and ICC and FAA and driver's licenses. 7. Extension of factories and instruments of production owned by the state, bringing into cultivation of waste lands, and improvement of the soil generally in accordance with a common plan. Think "state sponsored enterprises", Department of Agriculture, Dept of Commerce and Labor, Dept. of Interior, EPA, BLM, etc., etc. 8. Equal liability of all to labor. Establishment of industrial armies, especially for agriculture. Think minimum wage laws and social security and again, the Department of Agriculture. 9. Combination of agriculture with manufacturing industries, gradual abolition of the distinction between town and country, by a more equitable distribution of population over the country. Think "factories in the field" which the Dept. of Agriculture has been pushing since the 1930s, zoning, and government control of manufacturing and agriculture. The "more equitable distribution" has meant depopulation of the countryside. 10. Free education for all children in public schools. Abolition of children's factory labor in its present form. Combination of education with industrial production. I don't know about y'all, but in Tennessee we have these outfits called "public schools." Maybe y'all don't have those up north. And if you haven't realized it yet, all that state sponsored "higher" education is nothing more than vocational training for white collar workers. COMRADES! We have met the communists, and they are us! 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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| As US Debt To GDP Passes 101%, The Global Debt Ponzi Enters Its Final Stages Posted: 21 Feb 2012 09:29 AM PST Today, without much fanfare, US debt to GDP hit 101% with the latest issuance of $32 billion in 2 Year Bonds. If the moment when this ratio went from double to triple digits is still fresh in readers minds, is because it is: total debt hit and surpassed the most recently revised Q4 GDP on January 30, or just three weeks ago. Said otherwise, it has taken the US 21 days to add a full percentage point to this most critical of debt sustainability ratios: but fear not, with just under $1 trillion in new debt issuance on deck in the next 9 months, we will be at 110% in no time. Still, this trend made us curious to see who has been buying (and selling) US debt over the past year. The results are somewhat surprising. As the chart below, which highlights some of the biggest and most notable holders of US paper, shows, in the period December 31, 2010 to December 31, 2011, there have been two very distinct shifts: those who are going all in on the ponzi, and those who are gradually shifting away from the greenback, and just as quietly, and without much fanfare of their own, reinvesting their trade surplus in something distinctly other than US paper. The latter two: China and Russia, as we have noted in the past. Yet these are more than offset by... well, we'll let the readers look at the chart below based on TIC data and figure out it.
That the Fed is now actively monetizing US debt is beyond dispute (although some semantic holdouts remain - we are quite happy for them). Alas, with China, which has traditionally been the biggest buyer of US paper, no longer buying Treasurys, we are confident that the Fed will have no choice but to be dragged kicking and screaming once again into the fray, especially since traditional buyers of paper, even when allowing for exponential repo market leveraging (and someone please look at what is going on in the BoNY, State Street sponsored $15 trillion quicksand of repo'ed securities, which is the biggest black hole in the shadow banking system and will be the next pillar of the ponzi system to collapse) will be unable to keep up with US issuance. Especially since Primary Dealers already saw their Treasury holding rise to an all time high in the past week, and are loaded to the gills with US paper. So who is buying? Why Japan and the UK. Japan and the UK? Hmm, if these two names sound oddly familiar, allow us to refresh one's memory. Behold the pristine leverage condition of both these two countries, in all its glory.
Hint: look at the far left. So somehow the world's two most indebted countries (recall that Japan is about to in total pass 1 quadrillion debt) are out there and buying up the biggest amount of US debt (after the Fed of course)? Sorry, but while we are amusing by this attempt by the global ponzi regime to keep itself alive (even as Russia and China prudently step aside from the mauling that is sure to follow), whereby the most indebted nations keep buying each other's debt in the most transparent and potentially deadly shell game in history, we are also confident this is unsustainable. Which means the Fed will have no choice but to step in. And since when it comes to the capital markets, the ride up is over since we have now crossed the point where incremental profits are drowned by incremental input costs (thank you $106 WTI), the Fed now has just one mandate: to keep the US fiscal machine well-greased by buying up US debt at zero (and beginning in May negative) rates, through wanton monetization. 2012 may prove to be quite eventful after all.
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| Federal Reserve Driven Inflation Hurts Savers Posted: 21 Feb 2012 09:23 AM PST By James Rickards To understand why, begin with a world plagued with massive unpayable debt at the individual, corporate, and government levels. There are only three solutions to this much debt—default, inflation, and growth. …For large sovereign debtors, the preferred solution is inflation. …The Fed is doing everything possible to promote this inflationary outcome including holding rates artificially low, printing money, buying up bonds, and cheapening the dollar in foreign exchange markets. Of course, the Chinese will not be the only victims of this policy. Anyone relying on a stable dollar will suffer also. This includes savers, pensioners, and those holding insurance policies and annuities among others. [source]
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| Ron Hera Likes Gold, Silver, Limited Government & Individual Rights–02-21-2012 Posted: 21 Feb 2012 08:52 AM PST Ron Hera, the extremely bright and knowledgeable proprietor of HeraResearch, came back on FSN today. Ron and I walked the floor together at the Vancouver Resource Investment Conference, and he's a regular guest of the show. There's so much happening in the world today that no one can keep track of it. But, that's why we have gold and silver. When things are really heating up, gold and silver tell us everything we need to know. Copper can give us a great look into commodity and resource demand and pricing, but when gold and silver go dramatically higher over time, we learn the real story about the health of sovereign debt and the ever expanding money supplies. Our advice is to watch their prices regularly, but don't get too involved in the short term fluctuations. Ron had some interesting comments about the Casey-Brook debate that took place at FSN last week. Ron believes some elemental form of government is required to help us all live together peacefully and to protect the country from external threats. However, Ron also feels the system we currently have in place doesn't do a good job with anything it undertakes, and it's actually harming the economy and destroying opportunity in a wholesale manner. Excessive regulations, lawsuits, and taxes indubitably make us all poorer. So maybe it's time to start downsizing the public sector. Please fill out the subscription box on KerryLutz.com to receive your free Financial Survival Toolkit.
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| Guest Post: The Great Repression Posted: 21 Feb 2012 08:23 AM PST Submitted by Tim Price, Director of Investment, PFP Wealth Management by way of Sovereign Man The Great Repression "No government has ever commanded the resources at the disposal of our ungodly Leviathan, which consumes about 25% of the product of the world's richest country. It is driven by a voracious alliance of government's own employees, and those who receive benefits from the state. At least 90 million Americans either depend directly on government handouts or jobs, and each private worker must support not only himself and his family, but also carry a government worker on his shoulders." Financial markets don't really do the long term anymore, but if they did, they might spend less time drooling at the prospect of more monetary crack, and more time wondering who will be funding all the government debt that now towers above everyone further than the eye can see. CLSA's Russell Napier (hat tip to Macro Advisors' Filip Ruszkowski) recently pointed to an ominous development from the summer of 2011:
The chart above confirms that US corporate profits have now reached record levels as a percentage of GDP. They are unlikely to stay there. Napier suggests, perfectly logically, that when the government needs money to fund itself, it will target those constituents that actually have some. That is, in other words, wealthy individuals and corporations. What will be awkward about this financial repression of the moneyed classes, if it comes (which it surely will), is the timing. Well, not just the timing, but the yields on offer consistent with that timing. With the benefit of hindsight it would have been no bad thing to be coerced into buying US Treasuries when they yielded, say, 16% (the chart below shows generic 10 year yields going back to 1979; source: Bloomberg). But now that they yield 2% or so (a negative real yield of 1% or so using official inflation data), well, who wants that? Answer: not foreign central banks, many of whom have stopped buying this yieldless junk.
But somebody will have to buy it. As bank-robbers and their public sector rivals, governments, know, if you need money, go where the money is. Napier points out that previous peaks in the corporate profit-to-GDP ratio were 1966, 1997 and 2006. Subsequent long-term returns from equities were uniformly poor. As he makes clear, there is a difference between central banks and the private sector when it comes to buying government debt. Central banks can print money to finance their purchases, which makes them more or less wholly price-insensitive. But the private sector cannot print money - it will be forced to sell other assets to pay for the government debt it will soon be coerced into buying. Perhaps some of those other assets will be stocks. Stocks will get smashed in any case, because the private sector will also have to get used to paying more tax. (The government will get its money one way or another.) More tax = lower net profits, obviously. Tax paid by corporations is close to its average level of the past 30 years. More awkwardly, the federal debt to GDP ratio over the same period, Napier observes, has risen from 32% to 100%. The UK faces a similar problem, which makes the current euphoria in FTSE-land just as difficult to rationalise. Absent QE, and given the potential for a rather messy bang emanating from Greece over the coming months, and accepting an economy facing dollops of austerity well into the future, should UK stock markets really be as euphoric as they currently are? UK government bonds are comparably unattractive to their American cousins. The chart below (source: Bloomberg) shows generic 10 year Gilt yields over the past 20 years. Being forced to buy them at 10% might not have been so bad. Being bludgeoned into buying them at 2% will be a little more painful.
So how precisely will governments go about stealing savers' money? The Dutch pensions regulator gave an indication of one possible wheeze back in February 2011 when it ordered the Stichting Pensioenfonds Vereenigde Glasfabrieken (bless you!) pension fund to sell its gold holdings (13% of the fund) on the premise that it was too risky. In an NBER paper last year, Carmen Reinhart and M. Belen Sbrancia pointed the way. As their abstract states,
The UK government has already achieved partial control of directed lending given that it owns half of our banking system. (Not that it seems to know how to control its remuneration. But then it is practically a binding characteristic of governments to be half-assed about virtually everything.) Both of the Anglo-Saxon economies have also achieved saver theft status by the manipulation of interest rates. Next on the list will be a creeping abuse of those captive domestic audiences and, perhaps, regulation on capital controls. Very few of these will actually be novelties. The US previously had Regulation Q, for example, which put a government-sanctioned limit on the interest rates available for savings deposits. Indeed Reinhart and Sbrancia point out that the widespread use of such policies between 1945 and 1980 has been "collectively forgotten". We have had half a century of increasingly free markets. In the official governmental version of reality, those markets became too free, and now require the firm hand of the state. Governments are unlikely to acknowledge the extent to which their own untenable borrowings laid the groundwork for the financial crisis. Highly paid shills for the status quo on Wall Street have recently been wheeled out to observe the fundamental ugliness of western government bonds. They are correct. This is an asset class that has managed to defy the laws of economics in becoming ever more expensive even as its supply swells. Their response has been to recommend piling into stocks instead. The logic here is not so pristine. If Napier's thesis is correct, the West faces a period of outright deflation, which will be deeply traumatic for exactly the sort of speculative stocks that have lately done so well. Admittedly, the picture is confused, and prone to all sorts of political horseplay, as observers of the long-running euro zone farce can attest. Nevertheless, when faced with a) huge underlying uncertainties; b) structurally unsound banking and government finances; and c) central banks determinedly priming the monetary pumps, we conclude that the last free lunch in investment markets remains diversification. G7 government bond markets are a waste of time (though you may end up being cattle-prodded into them regardless). But there are still investment grade sovereign markets offering positive real yields. Stock markets are partying like 1999. Which, in many cases, it probably is. We would normally advise to enjoy the party but dance near the door. This time round, we weren't invited to the party - and we don't mind in the slightest.
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| TF Metals Report: Gold & Silver Looking Good; Caution Warranted Posted: 21 Feb 2012 08:21 AM PST metals are rallying, regardless, due to the money creation that will be the end result of this latest "bailout".
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The global financial system is not a game of checkers. It is a game of chess. All over the world today, news headlines are proclaiming that this new Greek debt deal has completely eliminated the possibility of a chaotic Greek debt default. Unfortunately, that is simply not the case. Rather, the truth is that this new deal actually "sets the table" for a Greek debt default. When I was studying and working in the legal arena, I learned that sometimes you make an agreement so that you can get the other side to break it. That may sound very strange to the average person on the street, but this is how the game is played at the highest levels. It is all about strategy. And in this case, the new debt deal imposes such strict conditions on Greece that it is almost inevitable that Greece will fail to meet some of them. When Greece does fail, Germany and the other northern European nations may try to claim that they "did everything that they could" but that Greece just did not "live up to its obligations". So does this mean that we will definitely see a chaotic Greek debt default? No. What this does mean is that the chess pieces are being moved into position for one.
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