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- Friday Options Recap
- Why The Sell-Off Of The Australian Dollar May Continue
- Tracy Weslosky Interview with Gene Arensberg
- LISTEN: One Hour with “Silver Shield” Chris Duane
- Interpreting the Sideways Bullion Price
- ECB: gold and gold receivables remain unchanged
- Gold in Q2 +15% To $1,850/oz On Inflation and Currency Debasement - BARCAP
- Chart of the day: Gold still in long-term uptrend channel
- A Little (More) Trouble In Big China
- Gold in Q2 +15% To $1,850/oz. – Barclays Capital
- Interpreting the Sideways Gold Price
- Gold & Silver Market Morning, March 23 2012
- Chinese gold buyers here for the long haul
- GFMS Global Head: "Buy This Gold Dip" as $2,000/oz Possible
- Turkey targets gold stashes
- J.S. Kim: Buy Gold & Stop Tyranny
- Keiser Report: Unbanked & Unworthy
- Silver Update: “China Bashers”
- Corvus Gold Hits Yellow Jacket Higher Grade Feeder Zone, North Bullfrog Project, Nevada
- Early-Stage Investing Opportunities: James West and Tobias Tretter
- Endeavour Silver Provides Blueprint to Sprott’s Call to Action
- China Contraction Sees Gold Fall Again…
- Bernanke Dutifully (or Ignorantly) Attacks Gold
- bank safe deposit box + gold coins = poof
- Investing in the Next Generation of Antibiotics
- Gold Money: A Once-in-a-Generation Buying Opportunity
- TDG Interviewed by Tekoa Da Silva 3-21
- Update on Silver & CFTC Follow Up
- Saudi Arabia And China Team Up To Build A Gigantic New Oil Refinery – Is This The Beginning Of The End For The Petrodollar?
- Corvus Gold 3-22
| Posted: 23 Mar 2012 06:33 AM PDT By Frederic Ruffy: Action was mixed through midday, but stock market averages strengthened in afternoon trading Friday. It's been a light news day so far. The only economic stat on the calendar showed New Home Sales falling to an annual rate of only 313,000 homes in February. Economists were expecting an increase to 323,000 from 318,000. Trading was somewhat volatile in Asia, with Hong Kong's Hang Seng and Tokyo's Nikkei both losing 1.1 percent. However, the euro added .5 percent to 1.3265 on the dollar and stock market averages were little changed across much of the Eurozone. Meanwhile, crude oil edged up $1.46 to $106.81 and gold is shining with a gain of $21 to $1663.5 an ounce. In stock trading, the Dow Jones Industrial Average is up 47 points. The Nasdaq erased early losses and is now up 5 points. With 90 minutes left to trade, CBOE Volatility Index (.VIX) is down Complete Story » | ||
| Why The Sell-Off Of The Australian Dollar May Continue Posted: 23 Mar 2012 06:22 AM PDT By Ralph Shell: Last week we offered our opinion of the Australian dollar in an article, Aussie Dollar Rolling Over from Highs - Is there More to Go? For a number of reasons we suggested there was some more downside potential. Like currency markets so often do, they give a head fake, first above 1.0630 before reversing direction. The catalyst for this week's change in the direction of the Australian dollar has been concern about the Chinese economy. As the world's second largest economy, and Australia's biggest trading partner, the impact on the economy is of special importance. As a consequence of the massive liquidity pumped into the Chinese economy by central planners, that country was able to avoid a recession suffered by the rest of the world. But the availability of such an abundance of funds has come with a price, resulting in a massive real estate bubble, inflation and a significant Complete Story » | ||
| Tracy Weslosky Interview with Gene Arensberg Posted: 23 Mar 2012 05:32 AM PDT Tracy Weslosky of Pro-Edge Consultants interviewed Gene Arensberg on Wednesday, March 21.
Source: YouTube The intro for the video reads: "Gene Arensberg, publisher and editor of GotGoldReport, explains why silver will hit $100 or more and shares his three favorite Vulture Stocks to invest in. You can read more of Gene's work at www.GotGoldReport.com" Disclosure: Members of the GGR team hold long positions in the companies mentioned. | ||
| LISTEN: One Hour with “Silver Shield” Chris Duane Posted: 23 Mar 2012 04:07 AM PDT Chris Duane aka Silver Shiled of Don't Tread On Me talks with the Survival Podcast. from TruthNeverTold: Part One Part Two Part Three Part Four Part Five ~TVR | ||
| Interpreting the Sideways Bullion Price Posted: 23 Mar 2012 02:58 AM PDT Over the last six months the gold price has gone essentially nowhere. Yes it's been choppy, but this week gold has been pretty much where it was on Friday September 23, 2011. | ||
| ECB: gold and gold receivables remain unchanged Posted: 23 Mar 2012 02:53 AM PDT | ||
| Gold in Q2 +15% To $1,850/oz On Inflation and Currency Debasement - BARCAP Posted: 23 Mar 2012 02:35 AM PDT gold.ie | ||
| Chart of the day: Gold still in long-term uptrend channel Posted: 23 Mar 2012 01:53 AM PDT
 http://www.chartoftheday.com/20120323.htm?T | ||
| A Little (More) Trouble In Big China Posted: 23 Mar 2012 01:17 AM PDT The final trading session of this week opened with mild gains in the precious metals' complex, as crude oil and copper recovered a tad and as the dollar retreated a bit on the trade weighted index. | ||
| Gold in Q2 +15% To $1,850/oz. – Barclays Capital Posted: 22 Mar 2012 11:34 PM PDT Gold's technicals remain poor and prices are heading for their fourth straight week of losses. This is particularly the case in US dollar terms due to the recent period of dollar strength. However gold's technicals in euro and other fiat currency terms are not as poor. | ||
| Interpreting the Sideways Gold Price Posted: 22 Mar 2012 10:00 PM PDT Gold has delivered zero net gains over the last six months. That may point to one rather useful property... | ||
| Gold & Silver Market Morning, March 23 2012 Posted: 22 Mar 2012 10:00 PM PDT | ||
| Chinese gold buyers here for the long haul Posted: 22 Mar 2012 10:00 PM PDT Another painful day for precious metal holders yesterday - with talk of slowing growth in China and Europe still hurting stocks and commodities. The gold price broke decisively below ... | ||
| GFMS Global Head: "Buy This Gold Dip" as $2,000/oz Possible Posted: 22 Mar 2012 09:16 PM PDT ¤ Yesterday in Gold and SilverAs I mentioned in 'The Wrap' in yesterday's column, the gold price didn't do much of anything in Far East trading on Wednesday...and the London high came very shortly after the 8:00 a.m. GMT open. Then at precisely 9:00 a.m. the selling started, sell stops were tripped, and down went the price. That decline came to an end at the London a.m. gold fix at 10:30 local time...and from there it didn't do much until around 8:40 a.m. in New York. Then, in the space of about fifty minutes, another twelve bucks was peeled off the price, with the low of the day [$1,627.00 spot] coming minutes before the open of the equity markets at 9:30 a.m. Eastern. Gold rallied in fits and starts from there...but the price action really quieted down once the Comex trading session ended at 1:30 p.m. From there it moved a few dollars higher going into the close of electronic trading at 5:15 p.m. in New York. Gold closed at $1,644.90 spot...down $5.20 on the day. Volume, net of all roll-overs, was in the 148,000 contract range...about 30% higher than Wednesday's volume.
Silver's high of the day was in London at the same moment as gold's...and from there, the selling pressure was relentless all day long, as the high-frequency traders did their thing. Silver's low price tick [$31.01 spot] came about twenty minutes before the Comex close at 1:30 p.m. Eastern time...and then silver rallied a bit going into the Comex close, and a little more in the electronic trading session that followed. Silver's intraday price move was $1.16...or 3.6%...about the same intraday price move as Tuesday. Silver closed at $31.59 spot...down 58 cents on the day. Net volume was very heavy...around 47,000 contracts.
The dollar index, which had been down all through early Far East trading, caught a bid moments after the London open...and by the London a.m. gold fix was up 45 basis points. From there it traded sideways...with the high tick of the day coming around 9:45 a.m. Eastern. From there it traded lower until precisely noon in New York...and moved sideways into the close. It was another day where the dollar index closed virtually unchanged. It was also another day where the gold price and dollar index activity were chained together but, as always, the metal sold off far more than the dollar index decline warranted
The gold stocks gapped down almost three percent at the open and, despite the fact that gold recovered almost all its losses on the day, the shares barely moved off the floor. The HUI closed down 1.96%.
Most of the silver stocks in Nick Laird's Silver Sentiment Index closed down on the day as well...and that index closed lower by 2.25%.
(Click on image to enlarge) The CME Daily Delivery Report showed that 87 gold and 1 lonely silver contract were posted for delivery on Monday. The link to this action is here. The GLD ETF showed that an authorized participant withdrew 242,851 troy ounces of gold...and there were no reported changes in SLV. There was no sales report from the U.S. Mint. Over at the Comex-approved depositories on Wednesday, they reported receiving a chunky 1,315,174 troy ounces of silver...and shipped a very small 18,523 ounces out the door. The link to that activity is here. Here's a chart about Turkish gold demand that Washington state reader S.A. sent my way yesterday. There's a must read story about Turkish gold demand further down.
Here's another chart. This one was sent to me by reader Tim Hart. It shows Mark Hulbert's data for Gold timing letters...and it's at the lowest it's been in the 23 months shown on this chart...down at 5%. And as Tim said..."From a contrarian point of view, this is quite bullish." Yes, it is.
Reader Scott Pluschau has another blog on silver for us today. It's headlined "Update on Silver with a follow up from the CFTC"...and the link is here. What Scott found out from the CFTC was the cut-off for the Commitment of Traders Report comes at the close of Comex trading every Tuesday. I thank him for digging up this info...and laying the issue to rest once and for all. I have the usual number of stories...and the final edit, as always, is in your hands. JPMorgan et al can keep this up as long as they think they can get more leveraged longs to sell. Turkey targets gold stashes. Why Gold Can Go the Distance: Frank Holmes. Thirteen year old gold sale has cost UK £11 billion. Hoard of 30,000 Roman coins found. ¤ Critical ReadsSubscribeHome Builder Stocks at Highest Point in 2 Years After 6-Month RiseAfter a bullish report on housing at a late summer investment conference in Dallas, the officials at Federated Investors decided to sink a few million dollars into the shares of the home builder Lennar. Philip J. Orlando, Federated's chief equities market strategist, was hoping for a return of 20 percent to 30 percent, confident in an improving jobs market and upticks in housing construction and sales data. Like many other stocks in the home building industry, Lennar surged, nearly doubling in price. Home builder stocks are at their highest level in two years, with the Standard & Poor's index of 11 home builder stocks rising 80 percent since October, the most recent low for the industry. This story showed up posted on The New York Times website on Wednesday...and I thank reader Phil Barlett for sending it along. The link is here.  Insider Trading Ban for Lawmakers Clears CongressThe Senate gave final approval on Thursday to an ethics bill that bans insider trading by members of Congress, clearing the measure for President Obama, who called for such legislation in his State of the Union address two months ago. The legislation was adopted by unanimous consent after the Senate voted, 96 to 3, to end debate on the bill, which was approved in the House last month by a vote of 417 to 2. The lopsided votes showed lawmakers desperate to regain public trust in an election year, when the public approval rating of Congress has sunk below 15 percent. This story was posted in yesterday's edition of The New York Times...and is another Phil Barlett offering. The link is here.  JPMorgan Loses $373 Million Arbitration to American CenturyJPMorgan Chase & Co. (JPM) was ordered by arbitrators to pay $373 million to American Century Investments over claims that executives led by Jes Staley enriched the bank at the expense of the fund-management firm. The award, issued privately in August, focused on JPMorgan's promise to promote American Century products when the bank acquired the firm's retirement-plan services unit, or RPS, in 2003. Because Staley, then JPMorgan's asset-management chief, mistakenly thought there was a limit on the bank's liability if it didn't meet obligations, executives failed to make good on the deal, arbitrators found. Employees were instead rewarded for pushing JPMorgan's own products, according to the ruling. "In short, JPM and RPS stacked the cards against ACI," the arbitrators wrote in the ruling. I love it when someone wins big against the dark side of The Force. This Bloomberg story was posted on their website late last night...and I thank West Virginia reader Elliot Simon for digging it up on our behalf. It's worth the read...and the link is here.  Gangster Banks Keep Winning Public Business. Why? - Matt TaibbiA friend of mine sent this article from Bloomberg, along with the simple comment: "Perfect." What's perfect? That the banks that have been caught repeatedly ripping off communities and municipalities -- banks that have paid hefty settlements for rigging bids, bribery and other sordid misdeeds -- keep winning the most public business. Apparently, our public officials aren't concerned about whom they hire to serve as the people's investment bankers. The news about Chase and Bank of America continuing to dominate a market they've already admitted to feloniously rigging says a lot about the state of modern finance. Bloomberg offered a telling quote from a state official justifying the decision to continue to do business with these criminal banks... "I haven't found an investment bank that hasn't had some problem in the last three years," California Treasurer Bill Lockyer said in a telephone interview. "We do business with them all. I think they provide good service. I think they've been highly ethical with us." This is coming from an official whose state, California, has seen multiple bid-rigging cases in recent years, from Riverside to San Mateo to Sacramento to Los Angeles to Santa Barbara, for starters. So a quote like that is pretty sad. It tells you that the system works fine for state officials and banks -- and no one is representing the people who actually lose out. Matt Taibbi over at Rolling Stone magazine is up on his soap box once again...and I thank Roy Stephens for sharing his blog with us. The link is here.  Fed's Fisher sees no need for more monetary easingThe economy is in much better shape and does not need further help from the central bank, a top Federal Reserve official known for his hawkish policy views said on Thursday. Although growth is "slower than we would like," Dallas Fed President Richard Fisher told Fox Business Network, "it's gaining momentum." "We will not support further quantitative easing under these circumstances because there's a lot of money lying on the sidelines, lying fallow," he said according to a transcript provided by the network. "We don't need any more monetary morphine." I thank Florida reader Donna Badach for sending me this Reuters story from yesterday...and the link is here.  Appeals court: Firms can sack older workers to cut costsA landmark court case has paved the way for employers to dismiss staff based on age - flouting discrimination rules - to escape huge pension payouts. The appeals court said on Thursday it was OK for an NHS trust to dismiss its chief executive as he approached 50 to avoid him clocking up pensions liabilities worth up to £1m. Nigel Woodcock was told in 2007 he would be dismissed when he reached 49, giving him a pension worth £200,000. If the trust had let him work until 50, his pension pot would have risen to between £500,000 and £1m, so bosses terminated his post. After a three-year battle, the Court of Appeal ruled today in the employer's favour, which will pave the way for public and private sector employers to legitimately dismiss staff based on age - even though the practice is unlawful. I wouldn't want to be a senior executive and close to retirement in Britain. This story was posted in The Telegraph yesterday...and is courtesy of Roy Stephens. The link is here.  Ireland slumps back into recessionIreland's economy sank back into recession in late 2011, despite logging its first annual growth for four years, official data showed. Irish gross domestic product (GDP) shrank 0.2pc in the fourth quarter after a contraction of 1.1pc in the third quarter, the Central Statistics Office (CSO) said in a statement, placing Ireland back into a technical recession. "With France and Germany's PMI coming in so low - they have been the catalyst that has been holding Europe together so it's a little bit of fear for some of the market participants," said Brad Thompson, chief investment officer at Stadion Money Management in Watkinsville, Georgia. The Irish GDP figures include output generated by both domestic and foreign companies base in Ireland. This story was posted in The Telegraph yesterday...and is another offering from Roy Stephens...and the link is here.  China and Australia in US$31 billion currency swapChina has signed a US$31 billion currency swap agreement with Australia, a step toward boosting the renminbi's profile in developed markets. Beijing has established nearly 20 bilateral swap lines over the past four years, but Australia ranks as the biggest economy yet to sign such a deal, which analysts said could give a shot in the arm to Beijing's goal of internationalising its currency. While central banks normally use swaps to provide liquidity to each other in the event of a financial crisis, China has been using them to lay the groundwork for the renminbi's slow march into global markets. This Financial Times story from yesterday is printed in the clear in this GATA release...and the link is here.  Posted: 22 Mar 2012 09:16 PM PDT  The Turkish government, facing a bloated current-account deficit that threatens to derail the country's rapid expansion, is trying to persuade Turks to transfer their vast personal holdings of gold into the country's banking system. The push to tap into the individual gold reserves -- the traditional form of savings here -- is part of Ankara's efforts to reduce a finance gap that is currently about 10% of gross domestic product. | ||
| J.S. Kim: Buy Gold & Stop Tyranny Posted: 22 Mar 2012 08:54 PM PDT A discussion of why Turkish citizens and citizens everywhere should not be duped by governments into turning their gold to them for bogus banker-given reasons of "patriotism" but should indeed, convert more of their paper fiat money into physical gold and physical silver as a means of protecting their own wealth from banksters that intend to bankrupt them. ~TVR | ||
| Keiser Report: Unbanked & Unworthy Posted: 22 Mar 2012 08:53 PM PDT In this episode Max Keiser and co-host Stacy Herbert discuss the great 'unbanked' masses dumping gold believing in a 'recovering economy' and an end to money printing while banks and insiders buy gold and mortgage backed securities in preparation for more quantitative easing by the Fed. In the second half of the show Max talks to Mark Melin of Uncorrelated Investments about MF Global, JP Morgan and the future of the futures market. They also discuss the Charles Manson's of the futures industry and the branch office of the too big too fail banks formerly known as the SEC. ~TVR | ||
| Silver Update: “China Bashers” Posted: 22 Mar 2012 08:41 PM PDT BJF examines Ag technicals shows love for the Perth Dragon in the 3.22.12 Silver from BrotherJohnF: Got Physical ? ~TVR | ||
| Corvus Gold Hits Yellow Jacket Higher Grade Feeder Zone, North Bullfrog Project, Nevada Posted: 22 Mar 2012 07:15 PM PDT March 22, 2012 – Vancouver, B.C., Corvus Gold Inc. ("Corvus" or the "Company") – (TSX: KOR, OTCQX: CORVF) announces the initial results from select intervals in the first 3 holes of its phase I Feeder Zone exploration program at the Company's 100% controlled North Bullfrog Project near Beatty, Nevada (Table 1). These initial higher grade intervals are from holes about 400 metres to the northeast of the proposed Sierra Blanca pit and resource (as outlined in the just-released preliminary economic assessment ("PEA") (NR12-07, February 28, 2012)) along 320 metres of strike and suggest continuity along the north-south trending zone, open in all directions (Figure 1). The Yellow Jacket target is one of several targets in the North Bullfrog District that the Company will be exploring in 2012 and is closely related to the existing resource incorporated in the PEA. The Company will follow-up on the encouraging results from step out holes to the west of Sierra Blanca (NR12-06, February 13, 2012), step out holes to the north of Jolly Jane (NR12-08, February 29, 2012) and these encouraging initial results from Yellow Jacket with a phase II program following the completion of its ongoing large diameter core phase. The phase II program will look to improve confidence and increase the current resource size with a mix of exploration and infill drilling. Jeff Pontius, Corvus CEO, stated: "The discovery of the Yellow Jacket feeder zone is very significant for the North Bullfrog project and Corvus in general as it adds an entire new dimension to the deposit and its potential going forward. We are excited about aggressively pursuing both the potential for a near-term mining operation and the expansion of this new and exciting discovery."
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| Early-Stage Investing Opportunities: James West and Tobias Tretter Posted: 22 Mar 2012 07:00 PM PDT The Midas Letter Opportunity Fund, a new niche fund, focuses on early-stage micro-cap miners in the junior resource sector. This sector has been an underperformer in recent months despite high gold... Visit the aureport.com for more information and for a free newsletter | ||
| Endeavour Silver Provides Blueprint to Sprott’s Call to Action Posted: 22 Mar 2012 06:04 PM PDT The company has been parking excess cash in silver and gold on a short-term basis since 2008. Instead of falling victim to the volatile silver market, Endeavour "elected not to sell a significant portion of its metal production..." | ||
| China Contraction Sees Gold Fall Again… Posted: 22 Mar 2012 05:36 PM PDT | ||
| Bernanke Dutifully (or Ignorantly) Attacks Gold Posted: 22 Mar 2012 05:25 PM PDT Ben Bernanke spoke out against gold this week. According to Joe Wiesenthal he destroyed the idea of gold returning as a form of money or primary part of a monetary regime: Ben Bernanke just gave the first lecture of his 4-part series on the origins of the Fed. … one thing really stood out … He spent | ||
| bank safe deposit box + gold coins = poof Posted: 22 Mar 2012 03:55 PM PDT http://www.shelbycountyreporter.com/...-100000-theft/ Pelham police investigators are looking into a March 14 theft of property report after a woman claimed $100,000 worth of gold coins were stolen from her safe deposit box at a local bank. Pelham Police Department Lt. Pete Folmar said the department received a call from an elderly Pelham woman on March 14 claiming the U.S. gold coins were missing from her safe deposit box at the Wells Fargo Bank at 2261 Pelham Parkway. "As it was reported to us, she said she went to open the safety deposit box, and they (the gold coins) were not there," Folmar said. "The investigation is still in the initial stages right now. We are doing our best to try to determine what happened." Jamie Dexter, a spokeswoman for Wells Fargo's Southeast region, said the bank is "fully cooperating" with Pelham police, but declined further comment. "We go to great lengths to protect the integrity of property in safe deposit boxes," Dexter said. | ||
| Investing in the Next Generation of Antibiotics Posted: 22 Mar 2012 02:59 PM PDT Scientists are very interested in bacteria for a number of reasons. Among the most recent is that they can be used to manufacture various important chemicals, including fuels. We tend not to think about it, but the single-cell microorganisms categorized as bacteria are the dominant life form on Earth. In some mathematical sense, this is their planet and we just use it. Their total biomass, after all, is greater than that of all living plants and animals combined. Bacteria inhabit the planet from the highest peaks to the deepest depths of the ocean. There are typically 40 million bacteria in one gram of soil and a million in a millilitre of fresh water. In our bodies, bacteria outnumber human cells 10 to one. Besides making extremely useful things possible, including Rioja wines, single-malt scotches and the Earth's biosphere, bacteria can also cause serious problems. Bacterial infection, in fact, may be the single largest killer in America today. However, we don't hear about a bacterial plague for several reasons... One is that some pre-existing conditions, such as diabetes or a virus-borne disease, often create the conditions that lead to an opportunistic bacterial infection. So statisticians tend to categorize deaths according to the condition that led to the lethal infection that actually killed the patient. Also, I suspect that the medical profession doesn't like to talk about the danger of infections that are often acquired in hospitals, though I may be too cynical. Regardless, some estimates are that bacteria cause, in the US alone, over 14 million skin and soft tissue infections, and 7 million methicillin-resistant Staphylococcus aureus (MRSA) cases, annually. Of those infections, 70% are resistant to at least one antibiotic. Moreover, resistance is growing due to natural evolutionary mechanisms as well as the misuse and over prescription of antibiotics. Just a few weeks ago, the world medical community suffered a serious scare when an Indian clinic announced it had a dozen patients with highly contagious tuberculosis resistant to all known antibiotics. A totally untreatable TB could, in fact, easily kill hundreds of millions and send Western economies into a long depression. Fortunately, the announcement was false. A therapy was found and the epidemic prevented. Still, the trend lines are clear, and public perception of this threat is growing. There are companies, however, that continue to make serious progress in the goal of creating new and effective antibiotics that bacteria could not adapt to. As concern over the fading effectiveness of antibiotics grows, investor attention will turn to the few companies working on solutions. Now is the time to act... before everyone else does. Regards, Patrick Cox The "After America" Archives... Debt-onomics and the Coming Debt-ocalypse The End of Empires Are Investment Ideas Useful? A Chinese Mini Communist Revolution The Final Countdown
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| Gold Money: A Once-in-a-Generation Buying Opportunity Posted: 22 Mar 2012 02:58 PM PDT Yesterday we discussed Bernanke's abominable interpretation of the gold standard and his hazy recollection of the financial history of the inter-war years. We neglected to mention another hoary old 'golden' chestnut he banged on about. This chestnut is that there's not enough gold (which is money) to satisfy a growing economy. Therefore, a gold standard can restrain economic growth because of the tight rein it imposes on the money supply. Most people instinctively agree with this. But when you think about, you'll realise such an interpretation is one-dimensional. Let's start with the concept of money. Money is simply a representation of wealth. It is not wealth itself. Most people derive wealth from their labour. Money is a way for them to disperse (spend) their wealth in many different ways (via consumption) or defer consumption by saving. The creation of wealth in an economy happens irrespective of the amount of money circulating. If real economic growth rises by 10 per cent, and the money supply increases by just 2 per cent, then the price level adjusts to reflect the change. In this case the price level would adjust downward (deflate) to reflect a greater relative increase in wealth. If on the other hand money grows faster than wealth then the price level will rise. An increasing money stock divided by a stable pool of wealth is just another way of expressing inflation. It doesn't matter if the money stock grows slower than the rate of real wealth creation. 'Money' is just a numerical representation of that wealth. But here's why central bankers and statists don't like it: it causes deflation. Not bad deflation, like the type you get when an asset bubble bursts. We're talking good deflation, where an economy's natural tendency to innovate and make technological improvements lowers the price level over time. Such deflation is great for consumers because it puts a little more purchasing power in their pockets year after year. But it's bad for...guess who? Politicians, bankers and whoever else rely heavily on debt. Under a gold standard, where the money supply grows very slowly (usually around 2 per cent per annum) there is a tendency toward mild deflation. In such a scenario households gain a little purchasing power - via the advances of technology - each year. But a monetary system that bestows minor benefits on a broad swathe of society cannot benefit special interest groups. And a government hamstrung by such a system finds it difficult to buy votes. In short, a gold standard - except in rare times of major gold discoveries - prevents an inflationary outbreak of the money supply. It tends towards deflation instead. Inflation is the monetary policy of the 20th and, so far 21st centuries. It is favoured by bankers (it encourages people to get into debt), central bankers (it justifies their existence) and politicians (it provides them with the funds to selectively bribe the electorate). Unfortunately, the general population also favours inflation because it provides the illusion of wealth. People fall for the fallacy that money equates to wealth. Thanks to Bernanke and the central bank brigade, there is now more 'money' in the world than at any other time in history. Yet our 'wealth', or living standards, has not kept up with the recent historic surge in the money supply. But for some reason the world continues to look at Bernanke as the font of all monetary wisdom. We're not suggesting the world should immediately return to a classical gold standard. That will probably never happen. Not at least until there is a crisis so bad that the clowns still running the show are completely discredited. But gold still plays a very important role in the financial system whether Bernanke wants to recognise it or not. Despite the absence of an official gold standard, humans are still digging gold up in all parts of the world and redepositing it in a vault somewhere. In a monetary system completely abused by special interests and the banking elite, gold remains in more demand than ever. It is the monetary North Star for an idling and listless system. China knows this. It's why they are accumulating physical gold at the same time as the western banking cartel do their best to keep the price down. Why is China accumulating gold? Gold is power. China has a very fragile financial system. The lending boom of 2009 has created another bad loan problem for the banks. This won't be a real problem as long as the yuan remains an inconvertible currency. That's because Chinese savers are trapped within the banking system. Their deposits effectively finance the loans of the banking system. If China freed the movement of capital now, the yuan would probably crash and there would be a run on the banks. So don't expect it to happen for some time. But China is taking its first steps to internationalise its currency. The front page of today's AFR reports that the People's Bank of China and the RBA have established a $30 billion currency swap arrangement. This is a way for China to avoid dealing with the US dollar as a settlement currency for trade. It's also a way for them to avoid dealing with the western banks that provide US dollar based trade finance. But to truly internationalise the currency its needs a solid foundation. It needs to offset the fragilities brought about by an imbalanced economy, a credit boom that channelled trillions of yuan into unproductive investments, and a financially repressed household sector where the return on bank deposits is less than the rate of inflation. As far as we can tell, that solid foundation will be gold. And as soon as this becomes apparent Ben Bernanke will go from teacher to class dunce. As a side note to all this, gold, and especially gold equities, have put in an ordinary performance of late. We put it down to the frustrations and machinations of a bull market. If bull markets climb a wall of worry, then you're seeing it in action in gold. We've followed the gold market for many years. The current angst and worry is nearly as extreme as we've seen it (apart from the 2008 episode). Could it get worse? Yes. If this 6-month stock market rally continues, gold will continue to flounder. But there are reasons why we think the end of the rally is near. A few weeks ago, we presented the chart of Apple (AAPL) as an example of a market getting a little carried away. The Apple share price has added another $50 since then. If you missed it, here it is again in its full, overbought, parabolic glory.  Goldman Sachs is probably right - they've just got the asset class wrong. We think gold is close to bottoming and the bear market rally is close to topping out. We watch and wait... Regards, Greg Canavan The "After America" Archives... Debt-onomics and the Coming Debt-ocalypse The End of Empires Are Investment Ideas Useful? A Chinese Mini Communist Revolution The Final Countdown
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| TDG Interviewed by Tekoa Da Silva 3-21 Posted: 22 Mar 2012 01:18 PM PDT We discuss the mining industry, the world of mining stocks, pitfalls, and other things pertaining to investing in gold and silver companies.
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| Update on Silver & CFTC Follow Up Posted: 22 Mar 2012 01:15 PM PDT
Silver's 50 day simple moving average of volume is around 44,000 contracts a day. And in three minutes before the close of the Comex it traded nearly 3,000 contracts with a sharp move in price of nearly down 1%. Within minutes after the close it did what I would call a U-turn and proceeded to march back toward where it broke down from in the proceeding overnight session. This seemed rather odd to me at the time and I decided to point it out in a post on the blog. I also decided to write to two of the commissioners at the CFTC that I have spoken with in the past and inquire about when was the cutoff for the COT report in silver. Was it at the close of the Comex at 1:25PM EST or the close of the globex electronic trading at 5:15PM EST? One commissioner I still haven't heard back from, but the other one, wrote me that they didn't know off the top of their head for sure and it was too late at night to find out. The email was around 11PM at night, and I have to say that replying to me at this hour was above and beyond the call of duty. This commissioner did follow up with me the following day and let me know that the cutoff for the COT report was at the close of the Comex on Tuesday. Read more @ scottpluschau.blogspot.com | ||
| Posted: 22 Mar 2012 01:07 PM PDT 
Those are very important questions, and they will be addressed later on in this article. First of all, let's take a closer look at the agreement reached between Saudi Arabia and China recently. The following is how the deal was described in a recent China Daily article....
At a time when the U.S. is actually losing refining capacity, this is a stunning development. Yet the U.S. press has been largely silent about this. Very curious. But China is not just doing deals with Saudi Arabia. China has also been striking deals with several other important oil producing nations. The following comes from a recent article by Gregg Laskoski....
Essentially, China is running circles around the United States when it comes to locking up strategic oil supplies worldwide. And all of these developments could have tremendous implications for the future of the petrodollar system. If you are not familiar with the petrodollar system, it really is not that complicated. Basically, almost all of the oil in the world is traded in U.S. dollars. The origin of the petrodollar system was detailed in a recent article by Jerry Robinson....
Once you understand the petrodollar system, it becomes much easier to understand why our politicians treat Saudi leaders with kid gloves. The U.S. government does not want to see anything happen that would jeopardize the status quo. A recent article by Marin Katusa described some more of the benefits that the petrodollar system has had for the U.S. economy....
So what happens if the petrodollar system collapses? Well, for one thing the value of the U.S. dollar would plummet big time. U.S. consumers would suddenly find that all of those "cheap imported goods" would rise in price dramatically as would the price of gasoline. If you think the price of gas is high now, you just wait until the petrodollar system collapses. In addition, there would be much less of a demand for U.S. government debt since countries would not have so many excess U.S. dollars lying around. So needless to say, the U.S. government really needs the petrodollar system to continue. But in the end, it is Saudi Arabia that is holding the cards. If Saudi Arabia chooses to sell oil in a currency other than the U.S. dollar, most of the rest of the oil producing countries in the Middle East would surely do the same rather quickly. And we have already seen countries in other parts of the world start to move away from using the U.S. dollar in global trade. For example, Russia and China have agreed to now use their own national currencies when trading with each other rather than the U.S. dollar. That got virtually no attention in the U.S. media, but it really was a big deal when it was announced. A recent article by Graham Summers summarized some of the other moves away from the U.S. dollar in international trade that we have seen recently....
Yes, the days of the U.S. dollar being the primary reserve currency of the world are definitely numbered. It will not happen overnight, but as the U.S. economy continues to get weaker it is inevitable that the rest of the world will continue to question why the U.S. dollar should automatically have such a dominant position in international trade. Over the next few years, keep a close eye on Saudi Arabia. When Saudi Arabia announces a move away from the petrodollar system, that will be a major trigger event for the global financial system and it will be a really, really bad sign for the U.S. economy. The level of prosperity that we are enjoying today would not be possible without the petrodollar system. Once the petrodollar system collapses, a lot of our underlying economic vulnerabilities will be exposed and it will not be pretty. Tough times are on the horizon. It is imperative that we all get informed and that we all get prepared.
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| Posted: 22 Mar 2012 01:05 PM PDT Here is our interview with founder and CEO of Corvus Gold, Jeff Pontius. Jeff discusses the recent drilling results as well as Corvus' plans for North Bullfrog in 2012 and beyond.
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