Gold World News Flash |
- Update On $80 Million in Seized Gold Coins: Judge Rules They “Belong to the U.S. Government”
- Learning about gold's potential take-off at banking school
- Reality vs. Obama: Is It Really a Revenue Problem?
- Monster Bluefin Tuna Found Near Australia, Fukushima Radiation Suspected
- Trader Dan on King World News Markets and Metals Wrap
- What's UP With Gold?
- Warning!! Silver Raid Ahead?
- 99 Years Of Keynesian-Monetarist "Winning"
- Got Gold Report - Euro Close to All Time Low Purchasing Power Relative to Gold
- Pepper investors, financial media with GATA's YouTube links
- Haynes and Norcini review metals' great week for King World News
- Stunning Developments In The Gold & Silver Markets
- Bill Gross: ‘Buy Gold, Bitchez!'
- As predicted, it's not the Euro that's in trouble…it's the Dollar.
- The Fed Is Expected to Launch QE3 Next Week ... Which Would Help the Rich and Hurt the Little Guy
- Suddenly, Nobody In Europe Wants The ECB Bailout
- This Past Week in Gold
- Gold Investing Lessons from Banking School
- Guest Post: Analyze This - The Fed Is Not Printing Enough Money!
- Name The New Reserve Currency: China Imports More Gold In 2012 Than All ECB Holdings
- Grandich Client Oromin Explorations
- Gold Back in a Big Way After $130 Million Purchase by Soros
- The Final Hurrah
- GOLD: The Newest, Pinkest Panther Of All!
| Update On $80 Million in Seized Gold Coins: Judge Rules They “Belong to the U.S. Government” Posted: 09 Sep 2012 12:00 AM PDT shtfplan
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| Learning about gold's potential take-off at banking school Posted: 08 Sep 2012 09:30 PM PDT In an interview with The Gold Report, Mike Niehuser* assesses the macroeconomic situation from a banker's perspective, explains why he is convinced gold is ready to take off. by The Gold Report, MineWeb.com
The Gold Report: Regarding Bernanke's comments, how does this impact your forecast on gold prices? MN: I think Bernanke's comments, as unclear as they were, demonstrate how polarized the world is in its thinking. The markets are looking for leadership and direction, something investors can trust to plan their investments. This became clear to me at banking school. One direction is to stable money, the other indecisive course will reap the whirlwind. I'm still holding to my original forecast for 2012 of gold ranging from $1,400 to $1,700/ounce (oz) with the potential for some catalyst to push the upside to reach $1,800 to $1,900/oz. While it may appear lame to reiterate what has already occurred, I am quite confident we could see a move to stabilize near the upside of the forecast toward the end of 2012. Due to the election, we may expect significant volatility through the end of the year. It should come as no surprise if silver traces a similar pattern. TGR: In light of your involvement with the banking industry, how do you think bankers feel about the possibility of more quantitative easing and its impact on interest rates and inflation?
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| Reality vs. Obama: Is It Really a Revenue Problem? Posted: 08 Sep 2012 07:18 PM PDT Since nobody seems to want to actually look into anything this President says or does, let's take a quick looksie into his handling of the Treasury's checkbook. Last week President Obama accepted his nomination to run for a second term. In his speech, the comedian-in-chief had this fantastic line: "All they had to offer was the same prescriptions they've had for the last thirty years. Have a surplus, try a tax cut. Deficit too high, try another. Feel a cold comin' on, take two tax cuts roll back some regulations and call us in the morning." Hilarious. However, the line should have read: "Bring in more individual income taxes per year than anyone over the past thirty years? Double down on government spending. Still creating record deficits? Make jokes about tax cuts and pretend you're not actually spending the country into bankruptcy" Over the past thirty plus years (ironically since Nixon ended the gold standard), the U.S. has seen government spending explode, while revenue tried to keep pace. The key takeaway from the chart below (other than the fact that Keynesians have ruined the finances of the country): - In 8 years, George W. Bush spent ~$2 Trillion more than he took in. - In Obama's first 3 years, he has spent ~$4 Trillion more than he has taken in. So in other words, it's taken 3 years for Obama to double GW's total deficit. One other tidbit, this does not include any fiscal 2012 data...
By the way, over the last thirty years President Obama has taken in the most individual income tax revenue per year than any other president -- the spending, well you can see for yourself.
In summary, the problem the U.S. faces is not a revenue problem, it's simply a spending problem.
But hey, sometimes it's better to make jokes about completely ruining the country than to actually stop spending.
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| Monster Bluefin Tuna Found Near Australia, Fukushima Radiation Suspected Posted: 08 Sep 2012 07:03 PM PDT Scientists are to test a monster bluefin tuna caught off New Zealand to see if it carries radioactivity from Japan's Fukushima nuclear plant. from Weekly Times Now:
Mr Worsteling said he waited more than 30 hours to hook the fish, then another two hours to haul it on board. This came after a year planning the trip to hook the fish.He said he was "blown away" when he saw the tuna, which took five men to haul aboard the boat. The fish will now be tested for radiation to determine if it has been affected by the Fukushima reactor meltdown in Japan. Read More @ Weeklytimesnow.com.au
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| Trader Dan on King World News Markets and Metals Wrap Posted: 08 Sep 2012 06:03 PM PDT [url]http://www.traderdannorcini.blogspot.com/[/url] [url]http://www.fortwealth.com/[/url] Please click on the following link to listen in to my regular weekly radio interview with Eric King on the KWN Markets and Metals Wrap. [FONT=Verdana][URL]http://tinyurl.com/9g6njpn[/URL] [/FONT] Click on this link to take you to the King World News audio transcript of some portions of the radio interview in addition to seeing the HUI to Gold comparison charts I have presented there. [FONT=Verdana][URL]http://tinyurl.com/8ozmrpt[/URL] [/FONT]...
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| Posted: 08 Sep 2012 05:43 PM PDT By Catherine Austin Fitts For most of 2012, gold and silver have been in a period of consolidation: both US equity markets and agricultural commodities have outperformed precious metals. But, as Franklin Sanders predicted in our report last month, this period of consolidation appears to be over. Gold and silver prices have moved up [...]
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| Posted: 08 Sep 2012 05:30 PM PDT |
| 99 Years Of Keynesian-Monetarist "Winning" Posted: 08 Sep 2012 03:38 PM PDT 99 years ago the Fed was born. Then there was a world war. Two decades later, Keynesian economics (in a somewhat mutated form than that envisioned by the author, much like the Taylor rule) became the gold standard (pardon the pun) of the status quo, as it gave the political establishment a "scientific" justification to spend and accumulate gargantuan debt loads without fear of backlash by the public. Then there was another world war. Then the gold standard was obliterated, allowing the same establishment to dilute the instrument used as money and to cross the "gargantuan" barrier in spending and debt issuance. Then the world came to the verge of complete socio-economic and systemic collapse after a ponzi pyramid of $1 quadrillion in credit money nearly imploded in on itself. Then the final chapter of the corporate takeover of the sovereign model established by the Treaty of Westphalia arrived, as private deleveraging at the terminal expense of public debt took place at a record pace. This is a nutshell is the world history of the past century. And to summarize where we currently stand, we present the chart below. In the entire "developed" world, there is only one country that runs a budget surplus, even as the entire "developed" world is now, according to the Reinhart and Rogoff definition of sustainable public leverage, insolvent.
And that, ladies and gentlemen, is Keynesian-Monetarist #winning!
* * * P.S. Among the list of key events above, we did not mention the following two other majors one: the creation of the Welfare state by Bismarck in 1870 as a German unification ploy, whereby people were promised virtually anything if only they voluntarily agree to participate in a sovereign ponzi scheme which by definition is unsustainable and cede liberty in order to perpetuate a lie subsequently adopted by all "developed" world governments taking advantage of their mathematically-challenged citizens, nor the 16th Amendment ushering the personal income tax (previously ruled unconstitutional), coincidentally the same year the Fed was born, which in turn enabled the creation of the most bloated apparatus (which as a reminder produces nothing) known to homo sapiens - the US government.
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| Got Gold Report - Euro Close to All Time Low Purchasing Power Relative to Gold Posted: 08 Sep 2012 03:18 PM PDT HOUSTON – Gold is breaking out of long period consolidations. Lots of them. For example, gold in terms of Euros is getting close to its all time high. The Gold:Euro exchange rate is challenging its February turning high and appears to be breaking out of a wide triangular consolidation as evidenced by the graph below which compares the gold price to the Euro Index (as a proxy for the Euro itself).
Breakouts (or breakdowns) from long-period consolidations indicate that the myriad conditions which conspired to contain the trading within the technical pattern are now changing. Breakouts are a signal that money flow has turned positive for the issue, meaning more liquidity is flowing into it than out of it. Triangular consolidations are often continuation patterns that resolve in the direction of the prevailing trend sooner or later. Note the label "Euro Crisis 2011-2012?" The question mark is not whether there has been a crisis for the period; that is self-evident. It is there to denote our skepticism that the European crisis ends this year. With European reliance on socialist central planning, technocrats and anti-productive, highly producer-discouraging tax policies, we seriously wonder whether the crisis on 'The Continent' will end this decade. For contrast, below is the same chart using the Canadian Dollar Index as a proxy for the Loonie. The smaller, but better-managed (so far) Canadian Dollar reflects market perceptions that the government in Ottawa has been more responsible and somewhat less profligate than their neighbors to the immediate south. Thus, the Canuck buck is farther from challenging its purchasing power lows (gold purchasing power highs) than the Euro, but clearly it too is breaking out of a consolidation. Clearly gold is once again gaining purchasing power in most or all fiat currencies. The charts above are irrefutable proof of it. Probably no one believes that is just a random effect, or a movement on the market's whim. The very powerful consolidation breakouts are answering something the market has been anticipating. Put simply, the collective market has been anticipating that governments would attempt to "print their way out of a giant debt hole." We can point to one trigger across 'the pond,' with the European Central Bank announcing its intention to do "unlimited bond buying" for a 3-year period, ushering in a new round of fiat money printing. Other catalysts include less than good economic data here in the U.S., the U.S. presidential election now just two months away with the U.S. headline unemployment rate still over 8% and the incumbent's chances for reelection flagging ... along with statements by the Federal Reserve that poor U.S. jobs performance is of "grave concern." Those and similar signals are all hinting that the Fed intends to do additional accommodative monetary policy action (more Q.E.) soon, perhaps in their September gathering. The Federal Open Market Committee (FOMC) statement from that meeting is expected September 13, one day after the German Constitutional Court rules on the constitutionality of the proposed monetary constructs of the European central planners. The consensus is that the German court will find a way to throw the Maastricht Treaty constrictions and sound money rules that induced inflation-paranoid Germany to sign on in the first place under a double-decker bus, enabling the elites in Brussels to, as ECB high priest Mario Draghi put it, "do whatever it takes to preserve the Euro." Our own opinion is that if the German court does find a way to thread the rule needle to allow ECB bond buying – in any form – it is akin to our own U.S. Supreme Court stretching and contorting it's own role under Chief Justice Roberts to find the only way that 'Obamacare' could be ruled constitutional. We can only guess that such a ruling would also sow the seeds of mass discontent in Germany just as the Robert's 5-4 majority opinion has here. Add to that increasing expectations of monetary stimulus in China despite a change in government to occur shortly, and witness the collective market attempting to price it all in, in advance – in the form of breakouts by gold to consolidation patterns aplenty. Race to Debase Currency debasement (increasing the amount of money – fiat currency - out of nothing in order to buy government debt is one example), is "bullish" for gold (and silver) as investors seek to protect wealth and preserve purchasing power. At the same time, governments seek to diversify their reserves out of deteriorating fiat currencies and into other, tangible assets, including gold. The best evidence of that has been central banks becoming net buyers of gold at a 500-plus tonne per year pace lately and heavier than ever imports of gold through Hong Kong into China. (The amounts are large enough to suggest that the government of China is 'secretly' increasing their gold reserves, to be disclosed at some future date when Beijing believes it will be to their advantage to disclose it.) As a side point, we note once again that it is gold that stands the test of time as trusted universal money. Fiat currency exchange rates to gold are merely the markets attempting to price paper currencies more in line with their overly-diluted supply relative to the naturally limited supply of the yellow metal. Soon the same will be true for silver in our opinion. It already is to a small degree. Note that the Euro (represented by the first chart), which has been in crisis mode for the better part of a year and a half, is the closest of the three currencies to reaching a new low in purchasing power relative to gold (a new high in gold purchasing power relative to the common European currency). The chart below is a more intuitive representation of the evaporating purchasing power of the Euro. It shows the acceleration of the Euro's loss of purchasing power since the 2005 breakout of gold in all fiat currencies – reflecting the market's realization that politicians were no longer even pretending to keep a lid on money printing. The fact that it has taught three generations of people to expect more than is actually sustainably possible from government; the fact that it has doomed a large fraction of the population to a new kind of social slavery and government dependence is just not relevant to the short-sighted, have-to-get-reelected-to-retain-power pols - yet. Without high price-inflation and its attendant social chaos showing up to give them away (as it did in the 1970s), why should the politicians even bother to change their tax, borrow and spend to get elected stripes? With only a few courageous exceptions in Congress, the American people have continued to elect the pols who promised them more and more government goodies – no matter the consequences. Instead of voting for good government leadership, the American people have collectively fallen for the Big Lie – that more and more government and less of a free market is the answer to all their ills. As H.L. Mencken warned, they have gotten exactly what they asked for "good and hard." Price inflation is evident to just about anyone who shops, eats or uses energy (just about everyone). But it is tame according to government statistics – so far. But that's where gold comes in and that's partly why the government and central planners ridicule and manipulate gold where and when they can – where and when the market will let them. Gold is a forward looking barometer. It reflects the monetary inflation (debasement and dilution of currencies) that has already occurred, with a lag. Gold predicts the coming inevitable price inflation that always follows monetary inflation sooner or later. In 2002 gold finally started answering the monetary inflation that governments all over the world racked up in the 1980s and 1990s as it accelerated right after 9-11 (2001). Since 2005 monetary inflation has gotten much worse and the world's inflation barometer, gold, has picked up the pace of its reflection of it. When the global supply of paper, electronic and digital currency explodes higher there is much, much more of the paper currency to be divided into a relatively finite amount of gold. In truth the amount of paper currency is growing at a much faster rate than the 1% to 2% per year of gold that can be added through new mining and production. The result of politicians' and central planners' profligacy has been that it takes more and more of the easily "printed" paper and binary chits to "buy" an ounce of gold. Hope for Change (But Prepare for More of the Same) With the focus likely to turn back to the extremely high and rapidly rising accumulated national debt in the U.S., now more than $16 trillion, we cannot be surprised to see the Gold:USD ratio (third chart above) playing a game of "catch up" to the Euro in terms of new lows in dollar buying power (highs in the USD price of gold), especially if the Federal Reserve announces more Q.E. in its next FOMC meeting just ahead on September 13. If the Fed disappoints or throws the gold market a curveball, it could cause a short term pullback in gold, but we think it is important to remember that the currency debasement underway is not just USD-centric. The 'race to debase' involves multiple sovereign contestants this time, similar to the 2005 period which opened the gold bull market floodgates. That 2005 event was an important, conclusive signal that our global experiment with under-backed fiat paper currency – where not even one official currency was backed by gold - has entered the terminal phase. We believe it is helpful to view the gold market through a longer term, monthly lens. Doing so eliminates some of the technical "noise" and allows major, longer-term secular trends to show clearly. For the last year gold has been consolidating its September, 2011 Eurozone-crisis-inspired thrust to $1,923, finding overwhelming support near $1,525 after a roughly 20% correction. Gold closed the year 2011 at $1,564.80 on the Cash Market. It is "up 11%" since then closing Friday, September 7, at $1,737.60. Well, actually, we should just say it now takes about 173 more paper dollars to exchange watered down greenbacks for real money – thanks to the U.S. Congress' lack of adult supervision and their total disrespect for what our currency used to be. As our friend Rick Rule says, the U.S. Congress has become a lair of counterfeiters. One thing, and perhaps the only thing that will stop them is a full blown currency crisis, in our own opinion. The breakout of gold in all currencies in 2005 was a sign that Big Smart Money all over the world began to accept that a currency crisis is coming. The most recent breakout of wide consolidation formations on technical charts (instead of the consolidations breaking down) could be signaling that we have entered another accelerated phase of currency confidence destruction. It also very well could be a sign we are that much closer to when the central planners can no longer control the inflationary forces they have taxed, borrowed, bought and paid for on our behalf. The good news is that at least today the massive government debt, the gigantic trillion-dollar-plus deficits, the runaway government spending, the crippling, job killing over-regulation, confiscatory taxation and the U.S. Federal Government erosion of our freedom are all now in the public debate (and much higher on the political priority totem pole than they used to be). It is a long overdue debate in our opinion. Believe it or not, that is one of the longer-term positive signs we take some comfort in. Heck, gold even made an appearance as a plank in the GOP platform for the first time since the 1980s. Even if it is only to form a commission to study the feasibility of returning the dollar to a gold standard, it is a triumph of Congressman Ron Paul who has been a lonely, courageous voice in the Washington political wilderness for sound money. That it shows up now is also a klaxon sounding to all of us that gold has repaired a lot of the psychological damage that occurred to it following its mania-blow-off top, its collapse in January, 1980 and the 20-year bear market that followed. The long-term positive signs include gold's acceptance as cash-equivalent collateral in multiple venues and perhaps even on bank balance sheets as a tier-1 asset beginning this coming January. A new gold standard may or may not be adopted in the near future, but just as it has for more than four millennia, gold is reasserting its historic role as money of the first and last resort globally, regardless of what the central planners say or think about it – just as we have been saying it would since 1999. Until the elimination of the income tax on capital gains for gold and silver (which is actually a tax on dollar depreciation), neither gold nor silver can be considered as true currencies, but perhaps that (elimination of the income tax on gold and silver) is also something we can look forward to if we choose well in November. Senators Rand Paul (R-Ky), Jim DeMint (R-SC) and Mike Lee (R-UT) as well as other real leaders in Congress have already proposed such a measure (Sound Money Promotion Act), so it's not at all farfetched to suggest it. Consider how arrogant and evil it is that the politicians who write the tax laws can destroy the value of our currency and then collect a tax on the one "currency" that appreciates on account of their bad stewardship. Politicians first ruin the money we are forced, at the point of a gun through legal tender laws to use, and then charge all of us a high tax because of it. There ought to be a special, very acrid, sulfurous, extra hot place in Hell for those pols… We need to show the "good guys" our moral and financial support – to let them know they are on the right path – right now, while they can still benefit from our support. We'll leave it there for now, except to say: Stay informed and vote responsibly.
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| Pepper investors, financial media with GATA's YouTube links Posted: 08 Sep 2012 03:09 PM PDT 5p ET Saturday, September 8, 2012 Dear Friend of GATA and Gold: The Russia Today television network reports very high viewership for GATA Chairman Bill Murphy's interview Tuesday on its "Capital Account" program with Lauren Lister, and so Murphy urges GATA supporters to send the interview's YouTube link -- http://www.youtube.com/watch?v=sxVsosT3GAw -- to other investors and any financial media contacts they have. If they're feeling ambitious, GATA supporters can also include the YouTube link to Murphy's interview last week with Daniela Cambone of Kitco News -- http://www.youtube.com/watch?v=MQ_yXdY8c74&list=UU9ijza42jVR3T6b8bColgvg... -- and the YouTube link to your secretary/treasurer's interview on "Capital Account" a month ago: http://www.youtube.com/watch?v=T0jpso4jDC4&feature=relmfu CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Prophecy Platinum Announces Wellgreen Preliminary Economic Assessment: Company Press Release VANCOUVER, British Columbia, Canada -- Prophecy Platinum Corp. (TSX-V: NKL, OTC-QX: PNIKF, Frankfurt: P94P) reports the results of an independent NI 43-101-compliant preliminary economic assessment for its fully owned Wellgreen nickel-copper-platinum group metals project in the Yukon Territory. The independent assessment, prepared by Tetra Tech, evaluated a base case of an open-pit mine (with a mining rate of 111,500 tonnes per day), an on-site concentrator (with a milling rate of 32,000 tonnes per day), and an initial capital cost of $863 million. The project is expected to produce (in concentrate) 1.959 billion pounds of nickel, 2.058 billion pounds of copper, and 7.119 million ounces of platinum, palladium, and gold during a mine life of 37 years with an average strip ratio of 2.57. The financial highlights of the preliminary economic assessment, shown in U.S. dollars, are as follows: Payback period: 3.55 years Prophecy Chairman John Lee says: "We are pleased with the preliminary economic assessment results. The numbers indicate that Wellgreen is one of most exciting mineral projects in the Yukon. The company is drilling to upgrade and expand the resource base. The infrastructure is excellent as the project is only 1,400 meters in altitude and 14 kilometers from the paved Alaska Highway, which leads to the Haines deep seaport. Discussions are under way with support from local stakeholders regarding permitting and logistics." For the complete press release, please visit: http://prophecyplat.com/news_2012_june18_prophecy_platinum_announces_res... Join GATA here: Toronto Resource Investment Conference New Orleans Investment Conference * * * Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006: http://www.goldrush21.com/order.html Or by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT GoldMoney adds Toronto vaulting option In addition to its precious metals storage facilities in Hong Kong, Switzerland, and the United Kingdom, GoldMoney customers now can store their gold and silver in a high-security vault operated by Brink's in Toronto, Ontario, Canada. GoldMoney also has recently partnered with Rhenus Freight Logistics to offer another gold storage option in Switzerland. The Rhenus vault is in the secured zone of Zurich Airport and offers customers superb security as well as the ability to inspect their gold. Storage at the new vaults in Canada and Switzerland is available at GoldMoney's lowest fees. Customers can select their storage location when placing their buy order. GoldMoney customers can take delivery of any number of gold, silver, platinum, and palladium bars from any GoldMoney vault, as well as personally collect their bars stored in the Hong Kong, Switzerland, and U.K. vaults. It's easy to open an account, add funds, and liquidate your investment. For more information, visit: http://www.goldmoney.com/?gmrefcode=gata
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| Haynes and Norcini review metals' great week for King World News Posted: 08 Sep 2012 02:49 PM PDT 4:45p ET Saturday, September 8, 2012 Dear Friend of GATA and Gold: Reviewing the great week in the precious metals markets for King World News, Bill Haynes of CMI Gold and Silver says the market manipulators have begun to lose and that the market itself will win in the end. And futures market analyst Dan Norcini sees hedge funds covering losses from being short. He expects them to go long. An excerpt from the interview is posted at the King World News blog here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/9/8_Stu... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Fred Goldstein and Tim Murphy open All Pro Gold Longtime GATA supporters Fred Goldstein and Tim Murphy have brought their many years of experience in the precious metals and numismatic coins to All Pro Gold as metals brokers who specialize in the delivery of gold and silver bullion bars and coins as well as numismatic gold and silver coins. Fred and Tim follow these markets closely and are assisted by a team of consultants in monitoring market trends. All Pro Gold offers GATA supporters competitive pricing on all bullion products and welcomes inquiries. Tim can be reached at 602-299-2585 and Tim@allprogold.com, Fred at 602-799-8378 and Fred@allprogold.com. Ask about their ratio strategy and the relationship of generic $20 dollar gold pieces to 1-ounce gold bullion coins. Visit their Internet site at http://www.allprogold.com/. Join GATA here: Toronto Resource Investment Conference New Orleans Investment Conference * * * Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006: http://www.goldrush21.com/order.html Or by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Prophecy Platinum Announces Wellgreen Preliminary Economic Assessment: Company Press Release VANCOUVER, British Columbia, Canada -- Prophecy Platinum Corp. (TSX-V: NKL, OTC-QX: PNIKF, Frankfurt: P94P) reports the results of an independent NI 43-101-compliant preliminary economic assessment for its fully owned Wellgreen nickel-copper-platinum group metals project in the Yukon Territory. The independent assessment, prepared by Tetra Tech, evaluated a base case of an open-pit mine (with a mining rate of 111,500 tonnes per day), an on-site concentrator (with a milling rate of 32,000 tonnes per day), and an initial capital cost of $863 million. The project is expected to produce (in concentrate) 1.959 billion pounds of nickel, 2.058 billion pounds of copper, and 7.119 million ounces of platinum, palladium, and gold during a mine life of 37 years with an average strip ratio of 2.57. The financial highlights of the preliminary economic assessment, shown in U.S. dollars, are as follows: Payback period: 3.55 years Prophecy Chairman John Lee says: "We are pleased with the preliminary economic assessment results. The numbers indicate that Wellgreen is one of most exciting mineral projects in the Yukon. The company is drilling to upgrade and expand the resource base. The infrastructure is excellent as the project is only 1,400 meters in altitude and 14 kilometers from the paved Alaska Highway, which leads to the Haines deep seaport. Discussions are under way with support from local stakeholders regarding permitting and logistics." For the complete press release, please visit: http://prophecyplat.com/news_2012_june18_prophecy_platinum_announces_res...
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| Stunning Developments In The Gold & Silver Markets Posted: 08 Sep 2012 02:03 PM PDT  Today King World News is reporting on the stunning developments taking place in the gold and silver markets. Acclaimed commodity trader Dan Norcini told KWN that in the metals markets, "We've had a huge amount of short covering from these (hedge fund) guys, who have had very sizable losses in gold playing it from the short side." Just weeks ago, Norcini correctly predicted the hedge funds would take losses in both the gold and silver markets because of the vulnerability of their short positions. This is exactly what has come to pass, much to the dismay of the hedge fund shorts. The acclaimed trader discussed hedge fund problems in both the gold and silver markets, but first, Bill Haynes, President of CMI Gold & Silver, had this to say about what is taking place: "These markets are bigger than the manipulators. There just comes a time when the manipulators have to step back and let the market go where it want to go. Then they can look for an opportunity, if they want, to go in and do some manipulation."
This posting includes an audio/video/photo media file: Download Now |
| Bill Gross: ‘Buy Gold, Bitchez!' Posted: 08 Sep 2012 02:00 PM PDT Bill Gross: I Am Leaning to Gold over Bonds Lots of fun as presenters are visibly shaken by Gross' analysis: "…gold is limited, paper assets are unlimited. Gold is a store of value, paper money is not. When central banks … Continue reading
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| As predicted, it's not the Euro that's in trouble…it's the Dollar. Posted: 08 Sep 2012 01:25 PM PDT Draghi Lured by Fractious EU Leaders to Build Euro 2.0
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| The Fed Is Expected to Launch QE3 Next Week ... Which Would Help the Rich and Hurt the Little Guy Posted: 08 Sep 2012 12:05 PM PDT Many speculate that the Fed will launch QE3 next week. But independent economics and financial experts say this would hurt – rather than help – the economy. Dallas Federal Reserve Bank president Richard Fisher said:
William F. Ford – former president of the Federal Reserve Bank of Atlanta – notes:
In fact, it has been thoroughly-documented that quantitative easing is great for the wealthy, but terrible for the little guy. As the Guardian reported last year, quantitative easing increases inequality:
The Washington Post reported last month:
Indeed, Bernanke knew in 1988 that quantitative easing doesn’t work. But he keeps caving in to the super-elite, and implementing it anyway.
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| Suddenly, Nobody In Europe Wants The ECB Bailout Posted: 08 Sep 2012 11:57 AM PDT
On one hand there's Germany for obvious reasons - not only are they footing the cost, but it is for them that the threat of an inflationary spike as a result of "unlimited" bond buys is most acute. But on the other, just as we predicted all along, are Spain and France, the biggest beneficiaries of the bailout, and whose bonds soared on expectations the ECB may buy them, who overnight have had a change of heart and say they never actually needed the bailout. Why? Because its politicians have suddenly had a change of heart and realize they will be sacked the second they hand over sovereignty over to the Troika or whatever supernational entity is in charge of the country following the submission of the bailout request. More importantly, and as explained before, as long as the yield on the bonds of insolvent European countries is sub 8%, not one country will demand a bailout. And as long as these countries reap the benefits of cheap rates, the policies of pseudo austerity will continue (as a reminder, nobody in Europe has actually implemented austerity), where nothing changes, where budget deficits continue to pile on, where sovereign debt continues to soar, where politicians continue making the same flawed policy choices, and where the European slow-motion trainwreck continues, only with a brief delay in the final inevitable outcome. By now everyone knows about the ECB party that sent US stocks to 4 year highs. Now comes the aftermath. From the NYT:
Here is where it gets funny:
And just as we predicted before...
All of this is just as we explained over a month ago: "In Order To Be Saved, Spain And Italy Must First Be Destroyed." We also explained why this will not happen, and that instead of being saved, Spain and Italy will ultimately be destroyed, by appearing to be saved first: as Mario Draghi kindly obliged us on Thursday. And all with the central-planners' and stats quo's blessing. The simple reality is that already the grand plan is fizzling, which was to be expected. After all politicians are involved. Recall that Goldman, who basically force fed its alum Mario Draghi the play by play (after leaking the ECB playbook hours in advance) now "predicts" (and by predicts, we mean demands) that Spain demand a bailout as soon as next week. Well, Spain PM Mariano Rajoy, who promised Spanish banks will never need a bailout one week ahead of the Spanish bank bailout announcement, already is digging his feet in. As Spanish El Economista write, Rajoy is "tempted" to delay the Spanish bailout request until after the Galician elections, i.e., until October 21. At the earliest. In other words, while the market has already front-ran the Spanish bailout demands, suddenly Spain will conduct at least 6 auctions between now and October 21, during which time bond buyers will be praying that eventually Spain will demand a bailout. Ironically, it is these same "bond buyers" who swallowed hook line and sinker the plan that Draghi et al laid out for them, namely to assume a bailout, and buy bonds, when by doing so, a bailout becomes unnecessary. Did we say bailout? We meant trap. So what happens in the meantime? Well, Spanish bonds can languish in the 6%, 5%, or even 4% range, which in turn will embolden the insolvent Spanish government to issue even more debt, thus making its fiscal situation even more untenable (recall the Spanish financial system is broke for one simple reason: too many (soaring) bad loans predicated by the endless collapse in the Spanish housing market). And issue bonds it will have to: recall that as we first explained, and as Nomura subsequently understood, Spain is on the verge of running out of cash! But suddenly now that the market pretends all is well, following the most recent bout of central bank intervention, no Spanish politician feels the urge to sign their own career death warrant and request that the ECB funds these purchases which Spain simply will not have the money for. Instead, the theater that "all is well" will continue until Spain does run out of cash (the record outflow in Spanish bank deposits makes that a certainty) at which point the transition chaos will be unprecedented as instead of arranging for an orderly transition, the panic in the Spanish government will be epic. Even the NYT now understands this dynamic:
And this is only Spain. Throw Italy into the mix, which the NYT admits has been even worse at implementing reforms, and one can see why even the once intelligent bond market has demonstrated surprising stupidity with its ramp in peripheral bond prices last week (which really has been just a massive short squeeze). But the piece de resistance, which readers of Zero Hedge know too well about, is that while jawboning will continue to yield results as long as reality finally demands an intervention, and Spain running out of cash will be just such an jawboning-event horizon, is that once the ECB is forced to begin buying, as up to now nothing has actually been done by the ECB which has merely taken rhetoric, promises and threats to a next level, it is all downhill from there:
Yesterday we explained why the Fed will do everything in its power to avoid enacting more LSAP-based QE (it simply does not have the capacity for the kind of massive program that everyone expects, and even an "open-ended" monetization will force everyone to do the math). Today, we learn why it is the ECB that also will do everything it can to not hit the buy button. The biggest paradox is that up to now, the fear of central banks, which is there in part due to their (rapidly dwindling) credibility, is what forced investors to "not fight the Fed/ECB"... and the banks took advantage of this by not doing anything, but merely talking. The time for talk is over, and for one reason or another, the time for action has arrived. Such action will very quickly demonstrate that the central-planning emperor was, indeed, naked all along, and the ramp across all risk assets was for naught. It also means that the next time when the central banks attempt a comparable jawboning of risk, they will be taken far less seriously, if at all. At that point one may expect the PBOC to finally admit just how much gold it has acquired in the past 4 years, and that anyone who wishes to give a totally new and still quite credible monetary authority the chance, is invited to do so. * * * P.S. The initial phrasing of this article's title was "Suddenly, Nobody Wants The ECB Bailout." We then added "In Europe" because there is at least one person in the US who is absolutely delighted by the ECB "bailout." The US president.
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| Posted: 08 Sep 2012 10:27 AM PDT Summary: Long term - on major sell signal. Short term - on buy signals. The metals have broken out of the year long consolidation, and we should see new highs in coming months. Any pullback/correction is buyable as long as the ...
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| Gold Investing Lessons from Banking School Posted: 08 Sep 2012 09:53 AM PDT Mike Niehuser, founder of Beacon Rock Research, incorporates his banking school background into his mining industry analysis. In this exclusive interview with The Gold Report, he assesses the macroeconomic situation from a banker's perspective, explains why he is convinced gold is ready to take off and shares the names of companies poised to profit from mining in the northwestern United States. The Gold Report: You were at the Pacific Coast Banking School last Friday when gold prices dipped and then surged on Federal Reserve Chairman Ben Bernanke's comments. Why are you attending banking school?
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| Guest Post: Analyze This - The Fed Is Not Printing Enough Money! Posted: 08 Sep 2012 09:47 AM PDT Submitted by Alexander Gloy of Lighthouse Investment Management Analyze This - The Fed Is Not Printing Enough Money! Before you trash me in the comments, hear me out. It started off with Ray Dalio's "beautiful deleveraging", which inspired this post. Since the financial crisis, the Fed has increased its balance sheet from $900 billion to $2.9 trillion (red line in below chart). The difference is $2 trillion (or 13% of GDP).
When the asset side of the Fed's balance sheet grows, so must liabilities. The Fed's liabilities consist mostly of money in circulation. So we can assume that $2 trillion in additional money has been pumped into the economy. Or has it? When the Fed buys bonds, it does so from "Primary Dealers" (21 global financial institutions). They hand over the bonds and get a corresponding credit on their account with the Fed. The Primary Dealers might then purchase some other securities with that money (which then gets credited to another bank's account with the Fed). And that's where the buck stops. Three quarters of the money "printed" never make it into the economy. They remain as excess reserves (reserves in excess of banks' minimum reserve requirements, blue line) in accounts at the Fed. Hence, of $2 trillion additional money, only $500 billion (yellow line) ended up outside the Fed. Why? Banks could use those reserves for lending, but there is no demand for additional loans (from customers with sufficient debt bearing capabilities). So if the money can't find its way out of the Fed – how is money created then? What is money? To understand, we have to take the example of buying a car. In the US, literally nobody purchases a car with money form a savings account. The ability to purchase a car depends on the availability of credit. No credit, no car. Credit availability depends on issuance of debt. Take a look at debt outstanding by ABS (asset-backed securities) issuers over the last 30 years:
ABS Credit market debt outstanding fell from $4.5 trillion at the peak in April 2007 to $2 trillion. That's a decline of $2.5 trillion. This is money not available for purchases. It dwarfs the $500 billion pumped into the economy by the Fed. Debt is money. The amount of debt outstanding controls the amount of money available for purchases, and hence for the size of the economy. In addition ABS issuers there is debt by households, non-financial and financial corporations as well as the government sector. By adding them up you get the big picture: the total credit market debt outstanding (TCMDO):
TCMDO is the blue line, on a log scale. The red line is the change in the annual growth rate of TCMDO, measured from the prior post-recession peak growth rate. You will notice that every recession over the last 60 years, with the exception of 1970, coincides with a slowing of the growth rate by at least 2%-points. The red triangle depicts the 1987 crash, which followed a period of serious slowing in the rate of TCMDO growth. Up until 2009, total credit market debt outstanding has never declined. The ratio of TCMDO to GDP continued higher and higher, at accelerating speed:
Has debt-to-GDP, or the debt-bearing capability of the US economy, hit a ceiling? Look at how little additional GDP (blue area, below) we obtained in comparison to ever increasing amounts of additional debt (red area):
The dotted black line is the marginal utility of debt (right-hand scale). Think of it like this: how much additional GDP do you get out of one dollar of additional debt (in %). In 1992, for example, you get $0.30 in additional GDP for every additional dollar of debt. Problem: this marginal utility of debt has trended lower and lower over the years, and actually reached zero in 2009. Meaning: you can add as much debt as you want, and it still won't give you any additional GDP. To repeat: no amount of additional debt seems to be able to get economic growth going again. That is a dramatic revelation. We might have reached the maximum debt-bearing capability of the economy. If true, no growth is possible unless debt-to-GDP levels fell back to sustainable levels (in order to restart the debt cycle). This could take years. At this point, the only way to reset the debt cycle is to get rid of debt. Ray Dalio correctly describes the three options available: 1. Austerity: this would be painful and take quite some time (the Europeans are going down this path) 2. Restructuring: requires write-downs and losses for bond investors (which are not being allowed to happen for fear of systemic risk) 3. Printing money: Inflation. Better yet: hyper-inflation. You have to destroy the value of debt fast enough before debt service costs, due to rising interest rates, drive the government into insolvency. In the US, (1) and (2) are not happening. That leaves (3). As shown above, the amounts needed for the Fed to be able to create inflation are much, much higher than what we have seen so far. And it is not guaranteed to work. Destroying the trust in the value of a fiat currency is a dangerous experiment with mostly adverse consequences.
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| Name The New Reserve Currency: China Imports More Gold In 2012 Than All ECB Holdings Posted: 08 Sep 2012 06:53 AM PDT The last time we looked at monthly Chinese imports of gold from Hong Kong in 2012, the comparable country in question was Portugal (whose citizens, if not central bank, incidentally have run out of gold to sell), because that is whose total gold holdings (at 382.5 tons) Chinese imports had just surpassed. Fast forward a month later, and the update is even more disturbing. In July, Chinese gold imports from HK, after two months of declines, have picked up once more and hit a 3-month high of 75.8 tons. While it is notable that this number is double the 38.1 tons imported a year prior, and that year-to-date imports are now a record 458.6 tons, well over four times greater than the seven month total in 2011 which was 103.9 tons, what is far more important is that in the first seven months of 2012 alone China has imported nearly as much gold as the total holdings of the hedge fund at the heart of the Eurozone, elsewhere known simply as the European Central Bank, and just as importantly considering the import run-rate has hardly slowed down in August, which data we will have in a few weeks, it is now safe to say that in 2012 alone China has imported more gold than the ECB's entire official 502.1 tons of holdings.
What is most amusing is that China, via the IMF, still wants the world to believe that total Chinese official holdings are just 1040 tons (double the ECB's), when it has imported half this amount in 2012 alone.
As a reminder, the last time China gave an update of its official gold holdings was in April for 2009. This means China has been aggressively hoarding gold for the past three and a half years without issuing an official peep about where its inventory stands now. Luckily, those who keep track of the newsflow have some idea. As an even more important reminder, in December 2009, the China Youth Daily quoted State Council advisor Ji as saying that a team of experts from Beijing and Shanghai have set up a "task force" last year to consider growing China's gold reserves. "We suggested that China's gold reserves should reach 6,000 tons in the next 3-5 years and perhaps 10,000 tons in 8-10 years," the paper quoted him. Has China managed to accumulated 6,000 tons yet? We won't know for sure until the official disclosure which will come when China is ready and not a moment earlier, but at the current run-rate of accumulation which is just shy of 1,000 tons per year, it is certainly within the realm of possibilities that China is now the second largest holder of gold in the world, surpassing Germany's 3,395 tons and second only to the US. Going back to the "important things", here is another one: in all of 2012, according to Treasury International Capital flow data, China has increased its Treasury holdings from $1,151.9 billion as of December 31, 2011 to just $1164.3 billion: a total increase of just $12.4 billion in 6 months: the slowest run-rate since China started to recycle in budget surplus into US paper.
Whether this dramatic slowdown (and no, China is no longer rerouting purchases via the UK whose holdings have, unlike prior years, hardly budged in 2012) is due to a plunge in the Chinese trade surplus due to the ever more obvious Chinese hard landing, and the lack of recyclable dollars, is unknown and largely irrelevant. What is known, and what is relevant, is that at Friday's closing price 458.6 tons of gold translates into over $25 billion worth of gold imports. For the first time in history China has imported twice as much gold as it has "imported" US Treasurys. But most importantly, and perhaps tying it all together, is what the deputy director of the Chinese central bank, the PBOC, said overnight at a conference in Xiamen. What he said is that the financial crisis has shaken confidence in the U.S. dollar. We knew that. What he added is that A global currency that is now backed by the second largest hoard of gold in the world, and targeting to be over 10,000 tons in a few years, and is supported by the fastest growing "developing" economy in the world, $14 trillion in deposits rising at an exponential pace, and well over one billion in population. Can anyone guess which currency is next in line of succession:
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| Grandich Client Oromin Explorations Posted: 08 Sep 2012 06:17 AM PDT The following is automatically syndicated from Grandich's blog. You can view the original post here. Stay up to date on his model portfolio! September 07, 2012 05:39 AM I spoke with Chet Idziszek, President of Oromin Explorations. Below are my questions and his answers. Q: What would you say the highlights are for the past year? A: There have been many highlights over the past year both on the technical side and the corporate side.* Ongoing successful exploration has allowed us to increase our total number of gold deposits from 8 to 14 which is definitely a major highlight, one that will enable further advancement in our overall Resource base.* One of the most important milestones to date at our Project is the Government's formal approval of our Environmental and Social Impact Assessment (ESIA).* This crucial document provides the necessary validation to enable Oromin to be Construction ready at the OJVG Gold Project moving forward. Q: What has your impression been of the foreign ...
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| Gold Back in a Big Way After $130 Million Purchase by Soros Posted: 08 Sep 2012 02:58 AM PDT He's buying the ETF instead of physical gold. The... [[ This is a content summary only. Visit my website http://goldbasics.blogspot.com for full Content ]] 
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| Posted: 08 Sep 2012 02:00 AM PDT A couple of important dates are coming up, a plan to buy sovereign bonds, a German plan, a Fed plan, Bernanke is no different from a lot of lunatic bankers, trillions in stimulus often create a short term party, inflation will eventually send us back to gold and silver,
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| GOLD: The Newest, Pinkest Panther Of All! Posted: 07 Sep 2012 08:11 PM PDT
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The 275kg tuna was caught by Victorian fisherman Paul Worsteling50km off the coast of Greymouth.
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