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- Sprott: “All Markets Are Manipulated”
- The Reasons for Investing in Physical Gold
- O'Leary: Gold Stocks Will Head Lower
- 5 High Yielding Mid-Cap Dividend Stocks With Buy Ratings And Hearty Earnings
- Gold has changed overnight, and likely will again
- Hathaway: Sentiment for Gold is at Rock Bottom
- “Bearish” Gold Hits 4-Month Low as Markets Fear Greek “Knock-On Effects”
- Gold Cover Clause Guidance
- Got Gold Report – Special Email Update for May 9, 2012
- Global Super-Bugs Herald Age of Silver
- Metals Down, Miners Up — What It Might Mean
- Eric Sprott on CNBC right now
- ECB: gold and gold receivables remain unchanged
- Demand in Asia and “Semi Official Buyer of Gold” On ‘Roubini Dip’
- Gold and the Scientific Method
- Commodity boom could transform Tanzania
- Gold Demand Not Broad Based
- Morning Outlook from the Trade Desk 05/09/12 - lots to talk about + blogs
- Precious Metals are Buffeted by Buffett
- Bullion at 4-Month Low on Greek ‘Knock-On Effects’
- It's This Bad Because It's a Bottom: Eric Coffin
- Central Banks Use Cost Averaging on Gold
- Commodities Sold Amid Greece-Fueled Risk Aversion
- Keeping the Decline in Gold Stocks in Perspective
- Market sell-off testing gold bulls
- Gold Has Changed Overnight, And Likely Will Again: Chris Powell
| Sprott: “All Markets Are Manipulated” Posted: 09 May 2012 06:42 AM PDT
from zerohedge.com: From the moment we all got to peek behind the over-leveraged financial system reality thank to Lehman's collapse, the-powers-that-be have made every attempt to stop this whole thing unraveling. Eric Sprott humbly suggests, when the CNBC anchor in the following clip questions recent gold price action as evidence of something wrong in his thesis, that just as Jim Grant opines, "All markets are manipulated" and that Central Banks (who are desperately trying to revive the dying system in every extreme monetary scheme possible) simply do not want to see the price of gold rising. He then notes that Silver is likely to be the investment of the next decade (although offers no strong thesis other than levered gold). Shrugging off the obfuscation from Omaha, "People who sell paper gold and paper silver can rule the markets in the short-term but physical participants will win the day in the long-run". Detailing some fundamental drivers for gold's advance, as the investment of the last decade and so for those three gentlemen (Buffett, Gates, & Munger) who missed it, I don't know that I should respect their opinion at this point in time. |
| The Reasons for Investing in Physical Gold Posted: 09 May 2012 06:27 AM PDT Most investors and savers should hold up to 10% of their investible assets and personal savings in physical gold and for some high-net-worth investors a greater percentage allocation to gold may be appropriate. |
| O'Leary: Gold Stocks Will Head Lower Posted: 09 May 2012 06:25 AM PDT |
| 5 High Yielding Mid-Cap Dividend Stocks With Buy Ratings And Hearty Earnings Posted: 09 May 2012 06:12 AM PDT By ZetaKap: Are you looking for mid-sized companies that still have room to grow? Do you prefer dividend stocks? Do you prefer investing in stocks that analysts have weighed in on? Looking for ways to dig deeper into a company's profitability? For ideas on how to evaluate this, we ran a screen. EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. EPS growth rates help investors identify stocks that are increasing or decreasing in profitability. This profitability metric is generally a key driver in the price of the stock, as it directly correlates to the profitability of the company as a whole. The Net Margin is a profitability metric that illustrates, by percentage, how much of every dollar earned gets turned into a bottom line profit. This is just one of many profitability metrics used by investors and analysts to better understand what the company is Complete Story » |
| Gold has changed overnight, and likely will again Posted: 09 May 2012 06:08 AM PDT |
| Hathaway: Sentiment for Gold is at Rock Bottom Posted: 09 May 2012 06:00 AM PDT Casey Research's Chief Metals and Mining Investment Strategist, Louis James sits down with John Hathaway, Senior Managing Director for Tocqueville Asset Management, at the latest Casey Research Conference, "Recovery Reality Check" in Weston, Florida. Subscribe to Casey's Daily for FREE: http://bit.ly/Caseys_Daily from caseyresearchfan: ~TVR |
| “Bearish” Gold Hits 4-Month Low as Markets Fear Greek “Knock-On Effects” Posted: 09 May 2012 05:38 AM PDT
SPOT MARKET gold bullion prices fell to their lowest level in four months during Wednesday morning's London trading, hitting $1581 an ounce – 3.7% down on the week so far – while European stock markets and commodities also fell and US Treasuries gained, with Greek uncertainty continuing to cast a shadow. A day earlier, gold fell below $1600 for the first time since early January. "Gold seemed to know only one direction today – down," says Tuesday's note from Swiss precious metals group MKS. "The bearish close opens up a full retracement to the December low of $1522," adds the latest technical analysis from bullion bank Scotia Mocatta. Silver bullion fell to $28.69 per ounce – also a four-month low, and 5.6% down on last week's close. On the currency markets, the Euro failed to regain $1.30, after falling back through that level yesterday having breached it on Monday for the first time since February. Sterling meantime hit its highest level since August 2009 on a trade-weighted basis. The stronger Pound saw Sterling gold prices drop to £982 per ounce on Wednesday, their lowest level since last July. On the New York Comex, open interest in gold futures trading rose to the equivalent of 1312.5 tonnes yesterday – up 2.4% on Tuesday last week – though it remains broadly in the middle of its range for the last five years. It will not be known however what proportion of these positions were long and short until the Commodity Futures Trading Commission publishes its weekly Commitments of Traders report on Friday. The volume of gold bullion held by the world's biggest gold ETF, SPDR Gold Trust (GLD), remained unchanged Tuesday from a day earlier at just under 1275 tonnes. GLD volumes did though spike higher yesterday, more than doubling from a day earlier to 17.8 million shares – although Monday's volume was towards the lower end of the recent range. The largest volume for GLD trading this year was 44 million on February 29, when gold fell $100 an ounce following Federal Reserve chairman Ben Bernanke's appearance before Congress. Alexis Tsipras , the leader of Greece's left wing Syriza, which came second in Sunday's election, will continue his efforts to form a government today, according to press reports. The mandate to form a government passed to Tsipras after first-placed New Democracy was unable to form a coalition. The Syriza leader has outline a five-point plan which includes cancelling the terms of Greece's bailout, suspending service payments on public debt, and investigating Greece's banking sector. "Voters [on Sunday] rejected the barbarous policies in the bailout deal," said Tsipras Tuesday. "They abandoned the parties that support it, effectively abolishing plans for [public sector] sackings and additional spending cuts…the popular verdict clearly renders the bailout deal invalid." Tsipras is today due to meet the leaders of New Democracy and third-placed Pasok – former coalition partners that backed Greece's latest bailout and who both saw their shares of the vote fall on Sunday. Many analysts, however, say they do not believe Tsipras will gain the agreements he needs to form a government. "Mr. Tsipras asked me to put my signature to the destruction of Greece," said New Democracy leader Antonis Samaras on Tuesday. "I will not do this. The country cannot afford to play with fire." Should Tsipras fail to form a government, the mandate would pass to former Greek finance minister and Pasok leader Evangelos Venizelos. "The Greek people asked for two things," said Venizelos Tuesday. "For Greece to stay safely in Europe and the Euro and at the same time to seek the best possible change in [bailout] terms so that citizens and growth can be helped." "Greece needs to be aware," warned European Central Bank executive board member Joerg Asmussen Tuesday, "that there is no alternative to the agreed reform program if it wants to remain a member of the Eurozone." "A Greek return to the polls in mid-June looks increasingly likely," says Malcolm Barr, London-based economist at JPMorgan Chase. "There is little doubt that the drop in support for New Democracy and Pasok has raised the probability of an eventual Euro exit." "Greece in itself isn't a big issue," adds Adrian Cattley, European equity strategist at Citi. Here in the UK, prime minister David Cameron described the Euro as "a project in transition" in a newspaper interview published Wednesday. "There's nowhere in the world that has a single currency without having more of a single government," said Cameron, although he added that "all these countries have to make their own choices" and that the Eurozone project "could go in a number of different ways". Spain's government will tell the country's banks to set aside an additional €35 billion as provision against loans made to the construction sector, newswire Reuters reports. Ratings agency Moody's meantime will begin cutting the credit ratings of over 100 banks this month, which could increase their funding costs and force them to reduce lending, according to Bloomberg. China meantime has been buying oil from Iran and paying with Yuan and gold bullion, according to the Wall Street Journal. Ben Traynor Gold value calculator | Buy gold online at live prices Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK's longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics. (c) BullionVault 2011 Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.
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| Posted: 09 May 2012 04:15 AM PDT
If today's landscape was a war setting, it would feature collapsed buildings, rubble on the streets, empty warehouses, smoke spewing upward from numerous city heaps, and fire hoses sending water in every conceivable direction throughout the entire city. And sadly, also dead bodies littered everywhere. They serve as the economic damage. The city ruins are marred by additional water damage, rubber boots a necessity. The buildings can be seen as the crumbled sovereign bonds. The street rubble is the home equity destroyed, some still underwater. The shattered warehouses are businesses either wrecked or in fast retreat. The smoke is the painful emotions based in despair, loss, and absent opportunity. In stark display, the fire houses are the central banks printing and dispensing money from tainted sources, not from factory income but rather the vacuous Weimar press. Of key significance is the compounded damage inflicted by the water itself. ZIRP and QE are tandem weapons of mass destruction that have been at work toward business destruction and capital ruin of the USEconomy for three full years. The zero interest rate policy assures the wrong pricing of money, the capital fuel, thus distorting all markets. The quantitative easing is based in extreme desperation, as the USGovt has lost the majority (80%) of its foreign creditor support.
The celebrated bond monetization assures the steady rise in cost structure which forces a vanishing of business profitability. The nation was taught improperly in pure heresy from USFed high priests that the free flowing liquidity was good, as the housing market expanded (bubble #1) alongside mortgage finance (bubble #2). The public was told incorrectly in 2007 that the damage would be limited. The Jackass forecasted absolute bond contagion and destruction, which has come to pass in shocking style. The sovereign bond collapse in Europe, where the USDollar printing must be conducted through the swap facility conduit, is evidence of the absolute destruction. Witness the collapse of the global fiat monetary system. The supposed solution from evermore central bank monetary creation has compounded the problem by adding to capital ruin. No solution within the current monetary framework is possible, thus the demand for gold. Impairment has moved from the margin to the core from water damage. Central banks, big corporate bankers, and finance ministry heads have no clue what to do and have begun to display their panic. They are out of options.
Conditions for gold investment and price rise could not be more perfect in the current environment. The infusion of fresh money without basis has led to historically unprecedented monetary debasement. The ruin of money is well along, certain to continue in greater amplified manner. The solutions based in debt gauze and debt ointment cannot cure the indebted patient suffering from debt breakdown and bankruptcy. Central bankers, looked to for leadership, have no clue what to do. They turn repeatedly to a broken first aid kit. The United States has seen over $3 trillion in new money shoved into the system in the last couple years. The European landscape has been overwhelmed by over $3 trillion just in the last several months. Yet no remedy is remotely visible, the new consensus. France has taken on the popular virus, calling for socialism in stronger dosage, to help the people. Spain is emboldened on the socialist theme, having given clear signals in rejecting austerity also. Italy could soon be worse infected, as unelected castle appointee Mario Monti must worry about being tossed off a balcony. The Greece showcase of failed solutions is visible to all, hardly the path other larger nations wish to follow. But the Greeks had no legs, no courage, and no guts to resist. Their leaders bent over at every request. Iceland stands as the workable model, whose solution rested on nationalizing the banks and repudiating debt held by banks.
The smell of monetary ruin is everywhere, as investment houses and private investments struggle to determine what money is anymore. It surely is not the fiat paper coerced as legal tender that is backed by debt and not output. However, in this perfect situation for gold investment, the main thrust powerpack is negative real rates. The prevailing ultra-low official interest rate is far below the reality-based prevailing price inflation rate. Even the 2% yield on the 10-year USTreasury is far below the true price inflation, whose annual rate is measured between 9% and 11% for several months by the unerring Shadow Govt Statistics craftsmen.
PROPAGANDA PUSH The mainstream has chosen to trot out some supposed experts among the elite business class. The banker class has been discredited. The Wall Street lieutenants appear more like mafia dons, smirking with Cheshire grins over unprosecuted $trillion fraud committed in serial fashion. So from Berkshire Hathaway came Charlie Munger to denigrate gold. He does not look like he misses any meals, nor has Warren Buffet's portly son. Neither have any gold credentials whatsoever, unable to recite even the basics of the market or its chief driving factors. Munger stated (as though an authority) that gold was not an investment for the civilized. Oracle Warren Buffet sold silver early, so he claims, back in 2003. What a grand lie! He followed Hank Greenberg's lead and created an income stream in selling option calls. The practice made Warren a liar, since he constantly proclaimed precious metals offered no income. When Warren's 129 million silver ounce hoard was called away in an option settlement, the Barclays gang took it and started the corrupt SLV exchange traded fund. Later it was sold to JPMorgan, where it has been corruptly managed ever since, to keep America strong. Their stock & trade is naked shorting of the metal, selling paper futures contracts with no posted collateral. Heck, on February 29th, they sold more paper silver in one hour than was produced by mining firms globally in a full year. The wonders of financial engineering by the New York & London crowd are glaring, the pus for which is visible from MFGlobal account thefts.
In the same manner, Bill Gates of Microsoft fame was trotted out. He had fewer words of wisdom to share on gold, except that it was speculative. Neither Munger nor Gates seems aware that the flow of financial crisis events and their aftermath reflect not in any way shape or form on civilized nations. Neither Munger nor Gates seems aware that investment in protection is highly prudent and justified against inflated asset breakdown, against debt saturation implications, against secretive elite cornering of official aid, against bailouts with new debt to cover old debt, against sovereign bond crumbling, against absent economic stimulus with meaning, against systemic capital ruin, against chronic job loss. But the Jackass digresses, certain to be called extreme and wild until the next dire forecast comes to pass in a long sequence of correct calls. To be honest, my forecast record has taken a nice turn toward the rosy and charmed ever since taking Rob Kirby's advice not to forecast long-term US interest rates anymore. He called the USTreasury Bond market the most corrupted interfered controlled and mangled of any market in the world. That was back in 2009. How true! See the Interest Rate Swap for long-term rate management. See the USFed for its chief buyer of USTreasury Bonds in a balance sheet wrecked as badly as the European Central Bank, both badly and irreparably toxic. They preside over monetary wreckage and banking system ruin.
The gold cartel has used a favorite piece of propaganda since 2003 when the bull market began in earnest. The claim has been regularly made that the gold bull is tired and exhausted since jewelry demand has fallen off. Any student of gold can tell you that tapered jewelry demand is solid confirmation of the gold bull market. It serves as an extremely reliable gold contrary indicator. It is easy to explain. People buy fewer necklaces, bracelets, and other valued objects, since they cost more in a noticeable manner. Some turn to selling old unwanted jewelry, especially if a reminder of a lost love interest. In its place comes a torrent of investment demand, where not $300 is spent on a piece for a lovely neck, but rather $30 thousand or $3 million in gold or silver bars. Investment volume is at least an order of magnitude greater than for jewelry. The motive for jewelry is often discretionary in the West, but a method for the lower and middle class to save in the East. The gold cartel trots out the idiotic vacant propaganda about sagging jewelry demand every four to six months, in order to fool the stupid masses. It works for some, especially those with lazy herd mentality research and with inadequate brain stems. To be sure, sluggish jewelry demand is a very reliable contrary signal to confirm a gold bull market, always has been, always will.
A sidebar note on Microsoft. When Gates was faced with anti-trust violations and potential breakup in 2004 and 2005, which would have been justice meted, he argued that the firm was a colossus to be sure, but was successful in innovation and needed to remain intact. Ever since reading the unauthorized biography entitled "Hard Drive" back in 1992, my trails have followed the Microsoft path closely. Their marketing innovation was sequential date rape, inviting the next generation for product development, hiding the systems software guys with swapped business cards, offering up a few $million to ambitious fools, then pulling the plug after the fools showed their trade secrets and copyrighted software (lifted their skirts, in the trade parlance). Months later, Microsoft would produce a competitor product, with the advantage of making the hooks efficiently tied to the operating system, but with broken hooks for the competitor products. So much for product innovation, Mr Gates. Their innovation was evident in the crappy products released for database management, like MS Access which is denigrated by every database expert the Jackass ever talked to. Oracle DB is for professionals, and MS Access for amateurs lacking standards of excellence who are required to use it.
The list of such violated companies is as long as a page, led by Ashton Tate, Micrografx, and Stac Electronics. In fact, the Jackass had a nice investment in Stac (CLICK HERE for background). Note the complete lie about talks for licensing, as intimidating requests for donation and zero compensation does not constitute as talks for licensing at all. Stac Electronics produced a software product that virtually doubled the disk drive capacity in the 1990 decade, long before 40gb was a standard hard drive, and compression was made obsolete. Recalled well were the words of my stock broker, who urged me never to bet against Microsoft, or Big Mo as he called it. He said any investor betting on the first successful infringement lawsuit against Microsoft was a surefire loser. Not!!! What the Jackass bought in Stac stock at $1.50 per share was sold at $4 to $5 per share about one year later after Stac won a lawsuit for theft of product, the first against Big Mo. To be sure, the Jackass did not have any great string of investment wins, but some.
Later, the MS Windows product development was unveiled further in ugly public glory. What a travesty in poor software development, totally lacking innovation, a glaring display of shabby software! They stomped on Netscape after severe intimidation, after they refused to donate to the MS Monopoly Kingdom. As it turned out, Microsoft bought the also-ran anti-virus software McAfee after Norton told them to get lost. They essentially appealed to the third best in an assortment of system software utilities, requesting them to donate their software for free, join immortality, and live on. The best and second best obviously refused. The third best were flattered and accepted, having no viable option in a tough marketplace. MS Windows continues to have substandard virus protection. Their defragmentation software is also substandard. Their breakdown recovery software is also substandard. So as for claims to excellence, Mr Gates is a laughing stock. His comments on gold were as deep as a 12-year old child's. Digress no more.
GOLD COVER CLAUSE A gold cover clause for new viable strong currencies is an idea whose time has urgently come. Consider another often used piece of propaganda that actually exposes the desperation of the gold cartel, and the assumed ignorance of the public once more. The concept goes like this: The gold supply is so limited, so that it could not possibly qualify as a hard asset backing for the money within the global monetary system. How totally wrong! How incredibly shallow! What they do is expose their own greatest vulnerability. Back in 1971, when the Bretton Woods Accord was broken, the gold price was officially set by force at absurd level, like under $40 per ounce. It quickly zoomed in the next decade to $800 in a relief exercise much like a jailbreak of a bunch of anxious men bent on seeking fun after restricted times.
Over the last 30 years, the growth in the money supply has been unspeakable in its huge volume. It could be several tens of $trillions just in official data for only the major nations. It could be well in excess of $100 trillion over the years, after excluding the derivative volumes. The monetary growth is like umpteen multiples over the timespan. Normally, the gradual growth in monetary aggregate would be accompanied by gradual new gold output to match it. The fiat currency system has permitted the expansion of social system networks. It has permitted the series of asset bubbles and busts, a cyclical phenomenon blessed as good by the clownish central bankers. It has permitted unchecked war aggression, complete with private profiteer motive. It has permitted magnificent bond fraud and counterfeit of both bonds and cash, the chief $100 bill violations coming from Langley and Tehran. Just last 2007, the USDept Treasury complained about missing $100 bill templates, a firm finger pointed at Langley, where independent income sources have long been desired and achieved. See the narcotics monopoly they command, with major platforms in Cambodia, Yugoslavia, and Afghanistan over the decades. So the false argument of adequate gold supply is trumpeted, but in ignorance as they reveal the very reason why gold should be priced at multiples higher. If the expanded monetary aggregate (money supply) were to be properly reflected in the price of gold, its price per ounce would be somewhere between $10,000 and $15,000 easily. So the hack argument is put forth on occasion. The rebuttal is that the torrid growth of new money without basis would justify a gold price almost ten times higher, at which point the shortage of gold would not be so acute.
In fact, the gold cover clause would then enter the equation. Note first a quick reference to the fractional concept. The gold cartel enjoys its fractional reserve policy that extends to bank lending and even the illicit gold bullion management. The central banks, sometimes with Congressional input, choose to dictate lending reserves within the entire banking system. In general, 10 to 20 times as much money is lent to borrowers as is held in bank reserves. It is called the fractional banking system. Pain comes only when economies go into reverse, as banks fail like flies caught in window sills during summer heat spells. The gold cartel illicitly extended the fractional practice to their gold management scheme. Investors typically place their gold bullion in the custody of the big banks, which assign Allocated accounts (metal bars identified with specific owners) or Unallocated accounts (cumulative metal pooled with owners of redeemable certificates). Unbeknownst to many supposed allocated account holders, their gold bullion metal is gone, treated to pooling improperly. This is precisely the basis of several multi-$billion lawsuits in Switzerland. The financial press prefers to genuflect and not mention the story to the public, for fear of alarming the investment community into a veritable stampede. The Swiss violations were tipped off to the Jackass in the summer 2010, having escalated into a national crisis but of hidden proportions.
The global monetary system could be backed by gold, but in a cover clause whereby each participating nation would declare a given percentage of gold for redemption upon demand. For instance, the entire world could do very well to create a stable financial platform and foundation for the monetary system with a 5% gold cover clause. If someone holds $100,000 in cash in whatever country, then the holder could demand $5000 in gold bars. A financial firm with $100 million in cash could demand $5 million in gold bars. The stability of the system would be made strong. The argument of inadequate gold supply would be alleviated during a rendered 20-fold increase in the money stock. Consider the workable 5% cover clause. Furthermore, in times of crisis replete with extensions to the scourge of steady USGovt $1.5 trillion deficits, and multi-$trillion Wall Street fraud, and endless $trillion Western Europe bond bailouts, the gold cover clause could be increased to 10%. In more stable times, the gold cover clause could be reduced back to 5% and even lowered to 3%.
COMPETING NEW CURRENCYS The flexibility of a gold cover clause device could enable a few competing currencies. They would float, but the linkage to gold would prevent much fluctuation beyond recognized bands. If the Russian Ruble were backed by a 2% cover clause, then that currency could float but drift lower in value. If a Chinese Yuan were backed by an 8% cover clause, then it could float with a higher drifted bias. If a new Euro Mark currency were backed by a 5% cover clause, then it could float with an even keel. The kicker could be the Gulf Dinar, which might be required for purchasing crude oil. The varying cover clause could act in the future monetary system backed by gold as a flexible system where the major nations could alter their percentage in gold cover redemption in much the same way they do nowadays with official interest rates. The many major central banks could actually manage the gold supply in a responsible manner, resorting to mundane duties like counting money and acquiring more gold, rather than the present function where they oversee reckless monetary expansion, control currency debasement, coordinate bond fraud, dispense gigantic grants to the elite caste of banks, and conceal narcotics money laundering.
See the March and April Hat Trick Letter reports for a continued discussion of a potential four currency system, all backed to some extent by gold. An extremely important point on new currency offerings. The opportunity for a second nation to launch a new hard asset currency is ripe when the first is announced. There is strength in numbers when it comes to new currencies, seeking the greatest critical mass. The odd men out would be the USDollar and the British Pound, possibly the Swiss Franc. No doubt in my mind that Japan would sign on with China to create a powerful and solid foundation for Asia. The US and UK would be forced to compete with at least three new strong kids on the FOREX block. The argument sometimes heard is that the Euro cannot break up, the Germans cannot start a viable new Nordic Euro currency, since the new currency entry would be a sudden victim of its own success. As it showed its strong foundation underpinnings, its exchange rate would rise and rise, enough to put the German export industry at great risk. True! But true only if the new Nordic Euro (or Euro Mark) is the odd man out.
Supposing four new currencies were launched, all hard asset currencies, in which the majority of global trade was settled, then the argument has big holes since the existing system would suddenly find itself outside looking in. That is precisely what is in progress of occurring in a system overhaul outside the US-UK sphere, after mammoth planning and execution in the background, with Finnish assistance and big commitments from Russia and China, the lead coordinator being Germany. The key is to produce a new system quickly and responsibly, in a manner with strength and vitality, that does not depend upon faith so much as substance. The Western leaders, principally US, UK, and Switzerland, have amply demonstrated that they prefer fraud and theft to leadership and integrity.
EUROPEAN LIGHTNING HITS Prepare for a simultaneous currency launch that will shake the Western power structure to the core and cause financial tsunamis from the grand tremors. The trigger could very likely be the sudden collapse of key nations like France, Spain, and Italy together as they reject austerity and push the bond market past the limits. In my view the fuse has been lit. Their banking systems and bond structures cannot withstand any more shock. The popular votes cast against austerity and the present course could instead be regarded as a clear toilet plunger pull, much like a popular uprising. The consensus want no more elite banker bailouts and harsh neglect of the people. The upcoming Eastern SWIFT bank transaction system is almost ready for prime time, its development in progress. The Chinese will take the lead position, taking the flack, pushing the process, which will not resemble the current SWIFT system in the flow vehicle. The transition of political power in Beijing makes the timing perfect. The Iran sanctions served to galvanize the anti-USDollar movement. One source involved in the barter system design, at the fringe of the new SWIFT system, reported that the Iran sanctions did them a great favor, by bringing several newer nations to the planning room for integration in the new global trade transaction system. DO NOT BE SURPRISED TO HEAR IT HAS A GOLD FEATURE TO HANDLE THE TRADE. Rumors to the effect that the Chinese want to implement a gold backed trade settlement system outside the USDollar, have been confirmed by my great reliable indefatigable source.
France will trigger the disruption process. Higher deficits are coming, also to Spain. Both nations reject the austerity built into budgets that clearly does not work. The next major challenge is to finance government debt. Watch for higher bond yields on sovereign debt, the signal for breakdown. The big new wrinkle is widespread rejection of austerity budgets. The major victims will be the big banks, which in my opinion will begin to topple quickly, and require bailouts, even a full recapitalization overhaul, more fuel for the gold bull. Already talk is loud in France over the potential failure of Credit Agricole. The big bank could imminently fail. Its failure seems an easier foreseen event than Lehman Brothers. The bond markets will resist with fierce stubbornness any easy financing of expanding government deficits. The bond traders are typically smart. They expect much larger deficits immediately. They can see that the economies in recession will make for a nearly impossible payback in debt, with certain larger deficits to follow. Expect even grander central bank bond monetization as the process accelerates. The truly stupid debate over QE3 is mind numbing in its empty thought. The Quantitative Easing never stopped. What fools to debate! Like arguing over a possible nasty rain session during an actual thunderstorm. The QE will become a widely publicly recognized phenomenon. The impact will be felt in gold demand, during an orchestra of monetary devaluations. Once again, another major wild card is the bank system recapitalization, whose needs would be several $trillion. It will made more urgent by the new wave of socialists in power, namely in France and Spain. During all this, the stifling MFGlobal effect has removed many legitimate players from the COMEX. It will become an irrelevance, an empty stadium. Perhaps the new Asian exchanges will thwart the Western influence (Rock & Roth gangsters) and take up the slack to produce an honest risk hedge market with price discovery brokering. The disintegration of COMEX, and deterioration of USEconomy will be events for the ages. They already are.
GOLD READIES FOR STORM My firm belief is that a fair equitable gold price will come only after the price goes dark in the normal traditional paper dominated channels. For over a month, the gold market has been operating like within the eye of a hurricane. At work is a new promising dynamic that most in the gold community seem totally unaware of, without solid sourced information. Repeatedly, my gold trader source, who has numerous billionaire clients on three continents, informs that truly gigantic buy orders are sitting between 1600 and 1680, spaced by 10 dollars apart, having greater volume with each lower notched price in an inverted pyramid. The Eastern Coalition is angry and motivated, fitted with well over $50 billion in a war chest, determined to wreck the New York and London bankers and remove them from their corrupt perch. Gigantic buy orders are being filled, the victims being gold cartel member banks themselves. They are highly vulnerable. They are strapped for cash, confirmed by a separate source. They face margin calls on sovereign bonds of Europe, compounded by some bad FOREX positions. To extract themselves from the pinch of the margin calls, the cartel banks are being forced to sell out their precious metals bullion held in reserve, in order to obtain desperately needed cash. This is a new phenomenon, not seen a year ago, in a total reversal used against them, since in the past, the cartel used the same methods against client hedge funds.
THE GOLD PRICE WILL RISE ONLY WHEN THE EASTERN DEEP POCKETS DECIDE THEY ARE CONTENT WITH THE MASSIVE GOLD RAIDS ON CARTEL GOLD RESERVES, ONLY WHEN ENORMOUS VOLUMES OF ORDERS ARE FILLED AT LOW PRICES, THUS DRAINING CARTEL MEMBER BANKS. The gold price will not rise until the Eastern Coalition has had their fill in a Western diet rich in gold on this round of the Groundhog Day cycle. The last cycle ended in mid-January. This round lasted longer, and involved much more gold taken from the cartel banks. They are badly and soon mortally wounded. Witness the unraveling of abused leverage by the cartel banks. In the process of de-leveraging, the cartel is losing their gold bullion. They are vulnerable, made worse by their insolvency, aggravated by their lack of liquidity. The paper gold price is imploding, but not the physical price. The divergence between paper and physical gold markets is proceeding exactly as previewed a few months ago. It is hard to see, because the great majority of gold investors do not have access to details on $billion gold orders being filled, who is supplying the gold, who is demanding the gold, and the conditions relating to margin calls, complete with motivated vengeance to deliver death blows in a global power struggle. Most people cannot contact their favorite friendly gold trader with a Rolodex of ten-figure clientele and request the latest battle won against a targeted bank. History is being made, but behind big broad curtains.
Unfortunately, the Eastern gold raids waged against the Western gold cartel might be satisfied with gold bullion pulled from the back door of the GLD exchange traded fund. As the Eastern Coalition observes the de-leverage process and swoops to exploit the insolvent condition compounded by lack of liquidity, the demands made on cartel member gold reserves might come from the GLD fund itself. The cartel simply shorts the GLD stock, entitling themselves to vast truckloads of GLD gold bars in illicit grabs. The tracks are covered by altered bar lists, whose track record is so abysmal and faulty that new covered tracks are easily made. The GLD fund is destined for a day like Madoff and Corzine before the Congress, but with far more lawsuits. Given the vast conduits between Europe and the United States, any event triggered on the continent will extend quickly to the US and UK. Got Gold Report – Special Email Update for May 9, 2012 Posted: 09 May 2012 04:03 AM PDT Vultures (Got Gold Report Subscribers) please log in to the Subscriber pages and navigate to the Got Gold Reports Section to view a Special Got Gold Report released Wednesday, May 9, 2012. We update subscribers on the markets for gold, silver and mining shares in this time of uncertainty, including what we are doing. To continue reading, please log in or click here to subscribe to a Got Gold Report Membership |
| Global Super-Bugs Herald Age of Silver Posted: 09 May 2012 04:00 AM PDT For several years I have been touting silver's unique anti-microbial properties. Out of the nearly infinite list of technological/industrial applications for silver, it always seemed inevitable to me that this one use would ultimately become our single greatest need for the Metal of the Moon. That suspicion/fear could, in turn, be traced back to a single threat which has loomed in an ever larger, ever more-menacing manner: Super-Bugs. This is the colloquial name given to the bacterial monsters we have created through the reckless, excessive, and simply idiotic manner in which our species has over-used its single most-important medicine: antibiotics. This is not a new issue, and so most readers are already familiar with the path that led us to what the World Health Organization is now openly labeling as the world's "post-antibiotic era". For those not already suitably terrified by the ominous meaning of those words, read this quote from WHO Director-General Margaret Chan: "Things as common as strep throat or a child's scratched knee could once again kill." This is not hyperbole, as Chan's warning has already gone from mere theory to actual fact. A chilling article in Bloomberg identifies two terrifying features of this newest and most-deadly Super-Bug. First of all it is completely invulnerable to any/all antibiotics in existence. That alone places it in an almost unique category of killers. However it gets much worse. The Super-Bug is described as "highly sexed". Translation: it can (does) merge itself with virtually any bacteria – including the most common species on our planet – and instantly transform those previously treatable bacteria into Mutant Super-Bugs, themselves. E. coli bacteria, cholera bacteria, even the (benign) microbes in our soil can all be transformed into Super-Bug killers. Bacteria which already outnumber our species by billions-to-one can (will?) become legions of nearly invulnerable killers. Fortunately, while our collective idiocy has now permanently robbed our species of its most potent protection from this potentially deadly menace, our ingenuity has provided us with a means to mitigate this medical catastrophe: silver anti-microbial technology. While the relentless over-use of antibiotics has ruined their effectiveness, other scientists have been systematically designing silver-based applications to protect us from these killers. It is important for readers to understand that these silver-based applications are preventative in nature, rather than being treatments for bacterial infections which have already taken root. In other words, silver protects us from bacteria through the creation of silver-based coatings or ionic compounds which can be blended into various (inorganic) substances. Thus we can create anti-bacterial clothing, anti-bacterial upholstery, anti-bacterial plastic and stainless steel surfaces, etc., etc. Why hasn't science focused on this approach sooner, rather than its complete over-reliance on antibiotics? Taking the treatment vs. prevention dynamic to an extreme, it's obviously cheaper and more efficient to treat individual pockets of infection with drugs than to create an entire "anti-bacterial world" around us. However, antibiotics are neither cheaper nor more efficient when they simply cease to function, bringing us back to silver. Given the significant increase in the price of silver over the past decade, many readers may erroneously view the creation of a (partial) "silver shield" around us as prohibitively expensive. |
| Metals Down, Miners Up — What It Might Mean Posted: 09 May 2012 03:31 AM PDT Gold and silver are down again today, but the mining stocks are up big. One day does not a trend make, but this is still a possible indicator of several things: 1) The plunge in mining shares has finally gotten the attention of investors who understand that most of these companies are viable and profitable, and that they won't go to zero. So at some point the downtrend will stop, and though today might or might not be that day, it's definitely coming. Downside risk, in other words, is now smaller than upside potential. 2) Share buyers are watching the mess in Europe and concluding that austerity is being replaced with monetary and fiscal ease. The European Central Bank will have no choice but to buy up trillions of euros of peripheral country debt to keep the eurozone together — or the currency union will fall apart and former members will go back to their old currencies and devalue aggressively. Either outcome is inflationary and therefore great for precious metals. 3) Gold miners are outperforming silver miners, which means investors are going for pure monetary protection rather than the growth/inflation play that silver represents. They're betting on chaos, which is pretty reasonable at the moment.
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| Posted: 09 May 2012 03:23 AM PDT Still very bullish. First time I can remember Sprott being on CNBC. They're trying to ridicule him about the metals. He's taking none of it. I'm sure it'll be posted on CNBC website later today. |
| ECB: gold and gold receivables remain unchanged Posted: 09 May 2012 02:01 AM PDT |
| Demand in Asia and “Semi Official Buyer of Gold” On ‘Roubini Dip’ Posted: 09 May 2012 01:34 AM PDT gold.ie |
| Gold and the Scientific Method Posted: 09 May 2012 01:16 AM PDT |
| Commodity boom could transform Tanzania Posted: 09 May 2012 01:15 AM PDT Extensive exploration activities have led to new gold discoveries in the region of Tanzania surrounding Lake Victoria, and new mines are expected to start operating in the coming years. The Tanzanian ... |
| Posted: 09 May 2012 01:11 AM PDT |
| Morning Outlook from the Trade Desk 05/09/12 - lots to talk about + blogs Posted: 09 May 2012 12:17 AM PDT The Greeks begin to pray, swear austerity is off the table. They will soon need to decide if they should/can pay the army or the police or their pensioners as the monetary flow will be cut off from the ECB. Does the world really need ouzo. Metals blew through support yesterday as monetary flows moved into the dollar, but more importantly investors that were re-scared (my new word) didn't buy insurance but ran to cash, liquidating their most fluid asset, metals. Is this the 1930's heading for a second depression. Don't think so. The boys will continue to print where necessary. Maybe my long forecast washout is underway. Will not be a straight line if I am right but a choppy pattern with lower highs. The give-up stage or capitulation is still a ways off, but I have already booked my truck rental in anticipation. In the interim, take profits where they are found. Check out some interesting precious metals blogs here: https://www.bulliontracking.com/en/blogs/ |
| Precious Metals are Buffeted by Buffett Posted: 09 May 2012 12:14 AM PDT The midweek trading session in New York opened to and continued to witness additional long liquidation among holders of gold, silver, platinum, and palladium positions. |
| Bullion at 4-Month Low on Greek ‘Knock-On Effects’ Posted: 08 May 2012 11:51 PM PDT Spot market gold bullion prices fell to their lowest level in four months during Wednesday morning's London trading, hitting $1,581 an ounce – 3.7% down on the week so far – while European stock markets and commodities also fell and US Treasuries gained. |
| It's This Bad Because It's a Bottom: Eric Coffin Posted: 08 May 2012 11:38 PM PDT Eric Coffin, editor and publisher of the Hard Rock Analyst newsletter, has never heard so much negativity from investors. "Everybody thinks the world is coming to an end," he tells The Gold Report. As a contrarian, all the doom and gloom tells him the market is about to pull out of its tailspin. In this exclusive interview, Coffin talks about the hard-hit juniors in the Yukon and why it's an area play he still believes in. The Gold Report: Eric, the gold bears recently outnumbered the gold bulls in Bloomberg's weekly Gold Bull/Gold Bear Sentiment Survey for the fourth time in a year. Are you a bull or a bear? Eric Coffin: I think the gold price is going to end the year higher, so I guess that makes me bullish, but I think of myself as agnostic. There needs to be a return of calm to Europe for the gold price to move much higher. The currency pair trade between the euro and the dollar is going to be a big determinant to the gold price. There's been more noise about the EU providing stimulus funds to offset all the government budget cuts in Europe. All of those countries have to deal with their debt loads. But it's not realistic to think that they can cut their deficit and 3% off their gross domestic product year after year and realistically get any net growth. The other side of that equation is that the U.S. has slowed down. That'll help the gold price because a lot of goldbugs are riding on there being another round of quantitative easing. I'm not sure it's going to happen. But as long as Federal Reserve Chairman Ben Bernanke keeps saying it might happen, that's good enough. TGR: Stagnant gold prices are translating to equities. Canaccord reports that "sector weakness in the gold equities over the last six years has typically ended with 'V'-shaped corrections to the upside." Do you believe that's what will happen this time?EC: I sure hope so because I'm on the buy side, not the sell side. I'm going to feel pretty dumb if it doesn't happen. We're still in a bull market for gold. In a secular bull market, generally speaking, coming out of a dip tends to be an impressive move. TGR: Many Yukon junior mining companies are starting their 2012 exploration programs after completing off-season financing on buyers' terms. What types of companies are getting financing? EC: The only financings I've seen in the past five months are either relatively new deals where investors have a lot of respect for management—which is a roundabout way of saying that investors figure management will figure out a way to make money regardless—or companies that have something pretty definitive with a bunch of drill holes. Companies that didn't take the opportunity to raise money last year are going to have to pull a rabbit out of their hat. The Yukon is an expensive place. There's no getting around it. Outside of companies with discoveries, like Kaminak Gold Corp. (KAM:TSX.V), ATAC Resources Ltd. (ATC:TSX.V) and Golden Predator Corp. (GPD:TSX), nobody's really done large financings and that's going to be tough. About 60% of the companies are going to have a hard time undertaking any significant programs this year. If the market gets better, which I think is going to happen, they still have a shot, but it's at buyers' terms. I suspect a lot of companies are going to say, "Let's just wait and see if next year is better." You haven't seen many announcements. Quite a few of those companies that were talking last year about doing $4, $6, $8 million exploration programs—many of those programs aren't going to happen. TGR: Desjardins Capital reports that 26 mergers and acquisitions worth a combined $30 billion (B) took place during 2010 and 2011. There are about 120 more companies operating in the Yukon. Are other junior explorers going to be forced to merge? EC: I think there will be merger activity at the junior level. There are a lot of companies with decent but not spectacular projects where they haven't done enough work and are not in a position to raise money. A merger is one way out for them. TGR: What did you think of the recently announced merger between Prosperity Goldfields Corp. (PPG:TSX.V) and Smash Minerals Corp. (SSH:TSX.V), which both have projects in the Yukon? EC: It was our idea, so we liked it. It's a really good combination of management teams and a good-looking project. The first set of results from this year's drilling at the Kiyuk project should be out any time. [Ed. note: results are available here.] I'm expecting good things from it. TGR: Is it still fair to call the Yukon an area play when the shares of most of the juniors operating there have declined considerably, often by more than half? Even good results often don't tangibly move share prices. EC: It still is an area play. This is a fairly common path even for a successful area play. The easy money has been made or, as is the case here, the market's just lousy and there is a lot of consolidation. The Yukon is getting to that point. The few companies that have done well will have the ability to pick up a lot of projects. In any area play, anywhere from a third to a half of the companies involved are piggybacking on the play to help raise money. Those companies tend to disappear quickly if they don't find something large right away or if the financing environment gets difficult. The bad market has exacerbated things but a large number of drop outs from an area play at this stage is not an unexpected development. TGR: Let's talk about some of the contenders. What would be some of the biggest exploration programs in the Yukon this summer? EC: Contenders will be the big spenders. ATAC is probably going to be the biggest up there at around $30M. Kaminak isn't very far behind. Both of those are funded new discoveries. ATAC is particularly interesting because it looks like it could have a camp. It's Carlin, which is something new to the Yukon. There's not a lot of doubt that it will have a lot of ounces to work with, especially if they have some luck with new drill targets. Kaminak's Coffee project is the same model as the original 1.5 million ounce (Moz) White Gold discovery, but it'll probably be larger. Kaminak is probably past that already, although it won't have a number out until early next year. Both of those companies will probably get resources out at the end of the season. Silver Range Resources Ltd. (SNG:TSX.V) has projects all around the old Faro mine. It has a very large land position and is drilling large bulk tonnage silver base metals zone. It also made a couple of high-grade silver vein discoveries late last year with similar mineralization to Keno Hill. Ethos Gold Corp. (ECC:TSX.V; ETHOF:OTCQX) has about $7 million budgeted for its Betty project, which is adjacent to Kaminak's Coffee project. This will be the first drill test at Betty that has generated some good high-grade numbers from trenching and test pitting, so that will be closely watched. Ethos is fully funded for that program with quite a bit to spare. TGR: Since we last talked, your brother David, your best friend and co-editor, passed away. He was a very fine geologist and a great human being. Our condolences for your loss. EC: Thank you. We are going to hold a dinner and fundraiser for the University of British Columbia geology department in honor of Dave on June 4 after the Cambridge Conference in Vancouver. Everyone can get together, have a meal and a few drinks, and tell stories about Dave. TGR: David often spent more than 200 days a year traveling to mining projects around the world. He helped start a new mining company before he passed away. Can you tell us about that? EC: We were meeting with Strategic Metals Ltd. (SMD:TSX.V) about its projects. Doug Eaton, who runs Strategic, showed us a different project set that got our attention. Precipitate Gold Corp. (PRG:TSX.V–pending) was formed to explore 15 projects optioned from Strategic in the southeastern Yukon and northeastern British Columbia plus four other 100%-owned projects. After the initial public offering, which should be later this month, Strategic will become a significant shareholder and Precipitate gets 100% of the projects. The lead project is the Reef project, north of Northern Tiger Resources Inc.'s (NTR:TSX.V) 3Ace project. A couple of large gold arsenic anomalies have been found at Reef, but they have not been drilled yet. There's some hard rock numbers there, but it will take drilling to figure out what it is. It's quite early stage. To read the entire article follow the link below: May 9. 2012 (Source: The Gold Report) http://www.theaureport.com/pub/na/13290 Disclosure: The editor of GGR participated in a private placement in Precipitate Gold (TSX: PRG.V) and holds a long position in the company. Disclosure: Northern Tiger Resources is a Vulture Bargain Candidate of Interest (VBCI) and is our fully fledged Vulture Bargain #7. Members of the GGR team are actively accumulating and hold long positions in NTR.V or NTGSF. |
| Central Banks Use Cost Averaging on Gold Posted: 08 May 2012 11:29 PM PDT Weakness in the paper gold market may continue due to technical selling or investor fatigue, but this weakness is masking the massive activities going on in the physical gold market, especially among central banks. |
| Commodities Sold Amid Greece-Fueled Risk Aversion Posted: 08 May 2012 10:51 PM PDT Commodities are under fire once again in early European trade as euro-zone crisis fears continue to drive risk aversion, weighing on growth-geared crude oil and copper prices. The dour mood is also stoking safe-haven flows into the US dollar. |
| Keeping the Decline in Gold Stocks in Perspective Posted: 08 May 2012 09:44 PM PDT Keeping the Decline in Gold Stocks in Perspective Jordan Roy-Byrne, CMT | May 07, 2012 The Daily Gold Free Newsletter As the gold stocks continue to fall to new lows and struggle to find a bottom, it is important to keep things in perspective. Before we get to the visual comparison with the 1960s and 1970s, we want to touch on the reasons why the gold stocks have underperformed in recent months and years. First, the sector had a terrific run that would have to be corrected. From late 2008 until the end of 2010, GDX advanced more than 4-fold from $15 to $64. Silver stocks, juniors and mid-tiers had a larger run that lasted nearly 30 months. It takes not months but quarters to correct that type of move. Moreover, GDX has yet to reach the 50% retracement at $41. A 38% or 50% retracement is routine. Furthermore, we've shown in recent writings that the current correction in percentage terms is in-line with corrections in past years. A second reason for poor performance from gold stocks is the strong stock market, which provides competition. If conventional investments perform well then there is less mainstream demand for Gold and gold stocks. After the announcement of QE 2 in August 2010, the large gold stocks advanced for only four months before reaching a peak. Since the announcement, the S&P 500 is up more than 30%. The S&P 500 has had a great run in the past seven months while gold stocks have really struggled. The best general market environment for gold stocks is not one of extreme strength or weakness but one of slight strength or neutrality. Third, mining is a difficult business in which operational difficulties are not random. Sure, energy costs and overall costs are higher but margins for the able producers are at record highs. The great companies are performing well in this environment, as they should be. The struggles of so many companies within a highly profitable environment is a testament to the overall difficulty of the mining business. Lastly, we believe the lack of performance can also be attributed to the wall of worry phase of a bull market. Current valuations are a reflection of the wall of worry phase. There are three phases in a bull market. Valuations increase at the start (stealth phase) and at the end (participation phase) but not during the middle, wall of worry phase. Presently, the gold stocks remain in the wall of worry phase. In the previous bull market, the wall of worry phase lasted five years. Below we plot the Barron's Gold Mining Index (blue) and the current HUI Gold Bugs Index (HUI). We've touched on this in previous writings, but there are noticeable similarities. The HUI had a sharper initial correction but rebounded to marginal new highs. The HUI now appears on its way to forming its first major bottom since 2008. When the BGMI bottomed in late 1971 it had effectively made no progress in six years. The BGMI is currently only marginally above its peak in 2006. may6edbgmihui.png This chart is not to imply that the HUI will follow the exact same path. More so, it is to illustrate the similarities between both markets as they endured the wall of worry period. In previous writings we showed how other bull markets (Nasdaq, Japan) endured their own wall of worry periods before exploding to new highs and then higher highs. From its low in 1971, the BGMI would rise roughly 12 fold in the last nine years of its bull market. With the current low valuations and extreme negative sentiment combined with the strengthening real price of Gold (implies future margin increases), we have little worry that this sector will explode in the coming years. The last six months have been a difficult period but it is closer to the end than the start of said period. With all of this in mind, it is wise to develop a game plan and a stock list. Scaling into positions (near support levels) over the next several months would be a wise move. For subscribers, we have updated our watch lists and prepared support levels to watch for a potential major bottom. If you'd be interested in professional guidance then we invite you to learn more about our service. Good Luck! Jordan Roy-Byrne, CMT Jordan@TheDailyGold.com http://thedailygold.com/keeping-the-...n-perspective/ |
| Market sell-off testing gold bulls Posted: 08 May 2012 09:30 PM PDT Another tough day for precious metals yesterday, with gold, silver, platinum and palladium hit hard by hedge funds' flight from equities and commodities. Concerns that Greece is on the verge of ... |
| Gold Has Changed Overnight, And Likely Will Again: Chris Powell Posted: 08 May 2012 09:17 PM PDT ¤ Yesterday in Gold and SilverThe gold price didn't do much until 3:00 p.m. Hong Kong time...and then the high-frequency traders showed up...and by the Comex open, gold was down about ten bucks from Monday's close in New York. Then the bid vanished...and gold was down another twelve dollars in less than two minutes...and it was all down hill from there. The low price tick [$1,594.40 spot] was at 11:15 a.m. Eastern...fifteen minutes after the London close. From there, the gold price recovered about ten bucks going into the close of electronic trading at 5:15 p.m. in New York. Gold finished the Tuesday trading session just above the $1,600 mark at $1,604.80 spot...down $33.70 on the day. Net volume was an eye-watering 194,000 contracts.
It was pretty much the same story in silver, although there was a bit of a bounce at the 12 o'clock noon London silver fix [7:00 a.m. Eastern]...but that didn't matter much once trading on the Comex began. The low price tick [$29.06 spot] came at the same time as gold's...11:15 a.m. in New York. The subsequent rally got sold off...but silver rallied a bit from there, closing the day at $29.47 spot...down 62 cents from Monday. Net volume in silver was pretty big as well...42,000 contracts. But compared to the volume in gold, silver volume was tiny, as there just aren't that many speculative longs left to be flushed out at these price levels...or new shorting by the technical funds, and I'm sure there was some of that going on...and in gold, too.
But it just wasn't gold and silver that got it in the neck yesterday. Platinum and palladium got creamed as well, with platinum down 1.18% and palladium down a whopping 3.73%. Both gold and silver were down 2.06%. The dollar index opened around the 79.60 mark...and by mid-morning in the Far East was in rally mode. The high water mark [about 79.95] came about 11:15 a.m. in New York...with a couple of minor dips along the way. That high tick coincided precisely with the lows for both gold and silver. From that high, the index fell about 25 basis point in the next two and a half hours...and after that began to rally a bit going into the close in New York. The dollar index closed up about 25 basis points from Monday...but its intraday price move was about 40 basis points. That's not a lot of index movement to hang an intraday move in silver of $1.03...and $44 in gold...is it? You pretty much have to have been born last night to believe that the sell-offs in the precious metals was related to that...considering the fact that the dollar was only up 20 basis points when the Comex opened for trading yesterday morning. A cursory glance at any of the charts of the four precious metals proves that this smack-down yesterday had nothing to do with what was going on in the currency markets. It was the 'da boyz' once again.
The gold stocks gapped down hard again...with the lows being set about 10:15 a.m. in New York. After that, the stocks traded pretty flat, even though the gold price continued to get hammered for another hour. Then late in the afternoon, the stocks rallied a bit...and the HUI managed to close back above the 400 mark. The HUI was down 3.38% on the day.
Despite the pounding that silver took, there were some green arrows here and there in the silver stocks. Nick Laird's Silver Sentiment Index closed down only 1.43%.
(Click on image to enlarge) The CME Daily Delivery Report showed that 27 gold and 31 silver contracts were posted for delivery on Thursday...and the link to the Issuers and Stoppers Report is here. There were no reported changes in either GLD or SLV yesterday...and the U.S. Mint reported selling another 3,500 ounces of gold eagles. They didn't report receiving any silver over at the Comex-approved depositories on Monday...but they did ship 416,389 troy ounces out the door. I was perusing the Q1 results for Endeavour Silver yesterday...and here's a paragraph out of their press release that's worth noting... "In January and February 2012, gold and silver prices enjoyed a significant rebound from their lows in December 2011. Endeavour therefore elected to sell most of the precious metal inventory it accumulated in Q4, 2011 in order to capture the higher gold and silver prices. However, gold and silver prices corrected sharply once again in March 2012 so Endeavour management once again chose to accumulate its precious metal production in Q1, 2012 rather than sell at depressed prices. As of March 31, 2012 the Company held 941,875 oz silver and 4,156 oz gold in metal inventory carried at cost on the balance sheet." Here's a chart of the "US Bond Yields" courtesy of Nick Laird. In his covering e-mail he made note of the fact that they were "pitiful...and D.O.A." That sums it up nicely.
(Click on image to enlarge) I have lots of stories again today and, as always, the final edit is up to you. As the news stories of the last few days have hinted at, the world's current economic, financial and monetary system has reached the end of the line. China's Gold Imports Jump as Country May Become Biggest User. Turkey Exports "Massive Quantities Of Gold" to Iran and Arab Spring Nations. Encouragement from Embry and Sinclair. ¤ Critical ReadsSubscribeOver 1,300 Tubes Damaged at California Nuclear PlantMore than 1,300 tubes that carry radioactive water inside the San Onofre nuclear plant in Southern California are so damaged that they will be taken out of service, the utility that runs the plant said Tuesday. The figures released by Southern California Edison are the latest disclosure in a probe of equipment problems that have kept the coastal plant sidelined for more than three months. At issue has been the integrity of tubing that snakes through the plant's four steam generators, which were installed in a multimillion-dollar makeover in 2009 and 2010. This rather unhappy AP story was picked up by abcnews.com yesterday...and I thank Casey Research's own Bud Conrad for bringing it to my attention. The link is here.  Bank of America Starts Mortgage Reduction EffortBank of America has started sending letters to thousands of homeowners in the United States, offering to forgive a portion of the principal balance on their mortgages by an average of $150,000 each. The reduction for qualifying homeowners could amount to monthly savings of up to 35 percent on mortgage payments, Bank of America said in a news release on Monday evening. The principal reduction offers from Bank of America Home Loans are the result of a $25 billion settlement agreement earlier this year with 49 state attorneys general as well as federal authorities who had been investigating allegations of abuses over the handling of foreclosures. This short story was out of The New York Times...and was posted on the finance.yahoo.com website yesterday. I thank Scott Pluschau for sending it along. The link is here.  Even A PhD Couldn't Keep This Man Off Food StampsTony Yang is getting beaten to a pulp. He's not wanted by mobsters nor is he another Cybercrime bully. The former University of California doctoral student (c/o '09) just says that's what it feels like each quarter when he wraps up an adjunct teaching gig and goes home without a permanent job offer. "It can be very tough on the psyche," he told the Chronicle of Higher Education. "The darkest moment had to be when I finished my dissertation. I turned it in and there (was) no job ... So when I graduated, the first thing I had to do was file for unemployment." As a kid, his family supplemented their income with food stamps. Decades later, he found himself in the same position, applying for welfare to get by when his doctoral degree wasn't enough to bring home a steady paycheck. This businessinsider.com story was posted on their website late last night...and I thank Roy Stephens for digging it up on our behalf. The link is here.  Jim Rickards: Romney Doubles Down on Obama's Toxic Currency PoliciesOn most issues, former Gov. Mitt Romney tries to distinguish himself from President Obama and set his policies apart from those of the current administration. Yet, in one area Romney is not only a clone of Obama but has doubled down and insisted that the president's policies be applied with even greater force. This area involves China and its alleged currency manipulation. The exchange rate between the U.S. dollar and Chinese yuan is the main battlefield in the global currency wars. Romney demands that China be officially branded a currency manipulator and suffer retaliation in the form of taxes and trade sanctions from the United States. This is just a more extreme form of Obama's continual diplomatic pressure on the Chinese to revalue their currency upward. The currency wars that Romney has vowed to fight are a recipe for disaster. The right course is sound money as embodied in the King Dollar policies of Paul Volcker and Ronald Reagan. The way to compete in international trade is not with a cheap currency but with technology, innovation, education, good labor-management relations, and a business-friendly environment. This is exactly how the Germans succeed at the export game. Germany has had export success for decades even with a strong currency because they have a favorable business climate. This must read Rickards commentary was posted over at the usnews.com website on Monday. I was saving it for the weekend, but thought the better of it. I thank reader Randall Reinwasser for bringing it to our attention...and the link is here.  Spain moves reluctantly to save major bankSpain will swoop in with public money this week to clean up huge bad loans at the nation's fourth-biggest listed bank, Bankia, the government said Monday. As news emerged of the impending rescue of Bankia, created in 2010 from a merger of seven savings banks, its executive chairman Rodrigo Rato announced his resignation. Spain's banks are still struggling to emerge from a 2008 property bubble collapse, which eliminated millions of jobs and left the financial sector buried in risky assets. This AFP story was picked up by news.yahoo.com on Monday. I borrowed it from yesterday's King Report...and it's definitely worth skimming. The link is here.  Argentine-Spanish trade row escalates after Telefonica finedThe trade row between Argentina and Spain took another twist on Tuesday after the Spanish telecoms giant Telefonica was ordered to pay $43m (£26.6m) for an interruption in mobile phone services lasting just a few hours. The fine by Argentina comes just days after President Cristina Fernandez de Kirchner seized control of domestic energy company YPF from Spain's Repsol. Julio De Vido, the Argentine planning minister, said on Tuesday that the penalty against Telefonica, which owns O2 in the UK, was intended to be a warning to other telecoms providers that service interruptions will not be tolerated. This is another offering from Roy Stephens. It was filed over at The Telegraph just before midnight their time last night...and the link is here.  Hungary in Crisis: Viktor Orbán's Dismal Mid-Term ReviewA political landslide brought Viktor Orbán into power in Hungary, where he quickly cemented his position with a two-thirds majority. But halfway through his term, the state of his administration is grim. Orbán probably would have envisioned his mid-term review differently. Two years ago, after the triumphant election victory of his right-wing nationalist Fidesz Party, the beaming winner Orbán announced the "overthrow of the old and the development of a new national order." In the meantime, the situation in Hungary could hardly be more desolate. The country is on the brink of financial ruin, its economy is headed downhill and the impoverishment of large groups of people is creating social problems. Hungary is extremely polarized domestically, and on the international stage it is more isolated than any other European Union country has ever been before. As if all of this weren't enough, Orbán is also grappling with unpleasant personnel issues. On the morning of May 2, the parliament had to elect a new president. The previous officeholder, Pál Schmitt, had resigned in early April after only 20 months. The former Olympic gold medalist in fencing, hand-picked by Orbán in the summer of 2010 to play the role of a loyal rubber-stamper of laws, stumbled into a plagiarism scandal. His 1992 doctoral thesis consisted almost entirely of Hungarian translations of other works. This story was posted over at the German website spiegel.de yesterday...and is another offering from Roy Stephens. The link is here.  |
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