Gold World News Flash |
- Incredibly Key Chart, This One Worries The Gold & Silver Bears
- Gold Seeker Weekly Wrap-Up: Gold and Silver Fall About 2% and 4% on the Week
- By the Numbers for the Week Ending October 19
- Izzy Friedman: What Now For the Price of Silver?
- R(osenberg) & B(ernstein): Two Ex-Merrill Colleagues, Two Opposing Outlooks, One Permabull Rebuttal
- Silver: The Train that Came Back to the Station
- Monetary metals shares ignored futures plunge today, Norcini tells KWN
- Social Media Bombs: Wells Fargo “Facebook-Bombed” By Hundreds of Messages in New Type of Activism
- German Industrialist: Insolvency Procrastination And How To Confront The Coming Inflation
- Goldman Sachs' Ian Preston Surveys the Gold ETF vs Equity Battleground
- The Gold Price Gave Back $35.20 this Week How Far Will it Fall?
- Gold and Silver Disaggregated COT Report (DCOT) for October 19
- The Spain Relief Rally is About to End
- Turk's chart shows gold going exponential against four major currencies
- Gold Daily and Silver Weekly Charts
- Today's Redbull-Sponsored Market Plunges By Most In 4 Months
- Platinum Price May Outperform Gold and Silver As Strike In South Africa Intensifies
- Gold drops over $20 an ounce, loses 2% on week
- COT Gold, Silver and US Dollar Index Report - October 19, 2012
- The Daily Market Report
- Jim's Mailbox
- Billionaire Frank Giustra: Gold is the Mother of All Bubbles, Which is Why You Should Buy It
- Western World Spends More on Dog Food & Manicures Than on Silver!
- How A Metals Dealer Works
- Gold Price Falls Sharply, Europe Disappoints
- LGMR: Gold's Fall Blamed On "Speculative Sellers", European Politicians "Papering Over Differences"
- The Outrageous and Totally Legal Threat to Your Wealth
- Silver Fails at 32.50 Support, Attempting to Hold at $32
- Turk - One Of The Most Important Gold Charts Ever
- Is The October Correction in Gold Already Over?
| Incredibly Key Chart, This One Worries The Gold & Silver Bears Posted: 19 Oct 2012 10:01 PM PDT  With the smash which took place in the gold and silver markets on Friday, below is one more incredibly important chart for the gold and silver bulls. King World News spoke with acclaimed trader Dan Norcini, who provided this chart exclusively to KWN.
This posting includes an audio/video/photo media file: Download Now |
| Gold Seeker Weekly Wrap-Up: Gold and Silver Fall About 2% and 4% on the Week Posted: 19 Oct 2012 10:00 PM PDT Gold saw just modest losses in Asia and London before it accelerated lower in late morning New York trade and fell to as low as $1716.10 by about noon EST, but it then bounced back higher in afternoon trade and ended with a loss of just 1.09%. Silver slipped to as low as $31.92 before it also rallied back higher in early afternoon trade, but it still ended with a loss of 2.02%.
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| By the Numbers for the Week Ending October 19 Posted: 19 Oct 2012 09:10 PM PDT This week's closing table is just below.
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| Izzy Friedman: What Now For the Price of Silver? Posted: 19 Oct 2012 09:00 PM PDT by Theodore Butler, SilverBearCafe.com:
t has been quite some time since my good friend and silver mentor, Izzy Friedman, has written something about silver. Devastated by the loss of his wonderful wife of 56 years, Gabriella, Izzy withdrew from his daily silver market observation and our telephone conversations in order to restructure his life around family and travel and contemplation. We have started to talk more frequently and he agreed to write something. For those who may not be familiar with Izzy, it was a personal challenge from him to me almost 30 years ago that started me on my own silver journey. Back in 1985, Izzy asked me how it was possible for a commodity that was being consumed in greater quantities than was being produced could fail to rise in price, as was dictated by the law of supply and demand. There was no doubt that silver had been in a consumption deficit for decades, depleting world inventories all along, yet the price went nowhere. I could not answer his question, but was determined to do so. It took me a year to discover that the price was artificially depressed by excessive and concentrated short selling on the COMEX. Once you are enlightened by the flame of knowledge, it doesn't extinguish itself easily. My discovery of the silver manipulation, for better or worse, has been with me ever since. Read More @ SilverBearCafe.com
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| Posted: 19 Oct 2012 08:32 PM PDT Earlier this week two former Merrill colleagues, since separated, were reunited on several media occasions, and allowed to spar over their conflicting views of the world. The two people in question, of course, are Gluskin Sheff's David Rosenberg, best known during the past 3 years for not drinking the propaganda Kool-Aid, and systematically deconstructing every "bullish" macroeconomic datapoint into its far more downbeat constituent parts, and his ebullient ex-coworker, Richard Bernstein, formerly head of equity strategy at a firm that had to be rescued by none other than Bank of America and currently head of RBA advisors, who just happens to be bullish on, well, everything. And since any attempt at holding an intelligent conversation on CNBC is ultimately futile (as can be seen here) and is constantly broken up by both ads, and interjecting anchors and show producers who care far less about facts than keeping the presentation 'engaging' (and going to such lengths to even allow Jim Cramer to have his own TV show), Rosenberg decided to dedicate his entire letter to clients today to "providing a rebuttal" of the slate of reasons why according to Bernstein the "we are on the precipice of a 1982-2000 style of secular market." What follows is one of the most comprehensive "white papers" debunking the bullish view we have seen in a while. Read on. From Gluskin Sheff's David Rosenberg R AND B It is music though not necessarily of the B.B. King variety. It's the Rosenberg and Bernstein duet. My good friend and former Merrill Lynch research colleague Richard Bernstein and yours truly duked it out at a business executive forum on Thursday over the market outlook. It was like the good or days and felt really good. I would say that over the long haul, Rich and I tend to share very similar philosophies regarding global events and how they will play out over time. That said, I have to tip my hat to Rich for having been earlier than I on the bull call for equities this cycle. At the same time, the bond-bullion barbell strategy and S.I.R.P. thematic has also managed to help generate decent risk-adjusted returns over the past three-plus years. But kudos to Rich for the stock market view. That's what the debate was (and is) about. He got it more right than wrong. Be that as it may. just as past returns are never a guarantee for future performance in the money management field, so it is true in the realm of forecasting that extrapolating your latest successful calls can often be a big mistake. Rich has said verbally and in print that we are on the precipice of a 1982-2000 style of secular bull market and has listed a slate of reasons why, and I intend on providing a rebuttal to each. First, Rich is excited about the fact that the total national debt (government, business and household combined) has come down to 340% from the record peak of 370% set in 2009 and as such the deleveraging phase is gathering apace. I agree that going on a debt diet is a good thing to do, but it also eats into domestic demand and is one of the reasons why this goes down as the weakest economic recovery on record. And at 340% on the aggregate debt/income ratio, we are merely back to the levels we were at the bubble highs five years ago.
I find it doubtful that the debt ratio has managed to find its way back to a sustainable level, and Rogoff and Reinhart did the hard research showing that post-bubble deleveraging cycles last at least ten years. So in baseball parlance, we're probably no better than in the fourth or fifth inning. And don't forget that the wonderful 1982-2000 secular bull run was caused in part from the multi-year run-up in the all-in deb/GDP ratio from 160% to 260% — the correlation with the S&P 500 was large at 82%. To be sure, correlation does not imply causation, but there can be little doubt that the proliferation of credit products and ever-greater accessibility to leverage contributed immensely to economic growth and corporate profits during that virtually non-stop two-decade period of unbridled prosperity. Today, and tomorrow, the movie is continuing to run backwards and will prove to be an enduring drag on the pace of economic activity, not just in the USA, but globally. Three other critical differences worth mentioning before moving on. In 1982. at the start of the secular bull run, the median age of the 78 million pig-in-the-python otherwise known as the baby boomer, the group which controls most of the wealth and has had a big hand in influencing everything in the past six decades from capital markets to the economy to politics, was 25 years old, heading into their prime risk-taking years and as such ushering in the era of aggressive growth and capital appreciation strategies. Today the median age is 55 and going on 56 and the first of the boomers are now turning 65— 10,000 will be doing so each day for the next eighteen years. And their tolerance for risk and need for income is considerably different than it was three decades ago. That much is certain.
The expansion in credit and the favourable demographic trends in that 1982- 2000 period helped generate annual economic growth, in nominal terms, of nearly 6.5% on average, taking the trend in corporate profits along for the ride. Not even the most bullish prognosticators see growth coming in anywhere near that pace for the foreseeable future. And of course, while Ronald Reagan was no fiscal conservative, his worst sin was a 6% deficit GDP ratio, much of it being cyclical by the way, and a 28% federal debt/GDP ratio. Today the deficit is closer to 8% (there is a much larger structural component) and the federal debt/GDP ratio is about to pierce the 70% threshold. Not to mention entitlements being a much more acute ticking time bomb as the ponzi schemes are that much closer to facing insolvency without some tinkering. Remember — fiscal policy in the U.S. in the go-go 1980s and 1990s was all about receding top marginal tax rates and greater deductions. Everybody liked this so much that many of the folks sitting across the aisle from the GOP were labeled "Reagan Democrats". No such bipartisanship exists today, nor is it likely to given the large degree of acrimony, so evident in the last presidential (and veep) debates. It may end up taking some sort of a crisis, in the end, to galvanize the two parties to work towards a resolution to the fiscal morass (as happened in Canada in the early 1990s). That Obama can never seem to get a budget passed or that Simpson-Bowles is collecting dust was not the politics of the Reagan-O'Neill accords of the 1980s. Even Clinton learnt how to compromise and work with the enemy (he was very good, by the way, at the Democrat convention — no doubt he would win another term running against either candidate, and it was so obvious that neither one really fully comprehends just how massive the fiscal problem is and the complexity and painful shared sacrifice that it will take as part of any viable solution). The 1980s and 1990s were all about industry deregulation. That fostered a durable expansion of both the 'E' and the 'P/E' as far as equity market valuation was concerned. That is hardly the case today, is it? And the 1980s and 1990s were all about breaking down harriers to global trade, again allowing for greater multiple expansion. This cannot be emphasized enough, especially in lowering business costs. Today, trade tensions are growing and protectionism rearing its ugly head via surreptitious currency wars. Sorry, but it ain't the 1980s and 1990s all over again, by any stretch. What the stock market has really experienced is a classic reflexive rebound from a depressed oversold condition, aided and abetted by radical government intervention, not entirely unlike what we saw from 1932 to 1936. As I said, in 1936, it would have been foolhardy to have overstayed the party by extrapolating a vigorous bounce off the trough into the future. I recommend that people don't repeat that mistake. The reason why policy rates in most parts of the world are at or near zero percent is because risk is high. Especially political risk. Make sure this is acknowledged in every financial decision you make. Moreover, in the 1980s and 1990s, the government was getting out of the way. Back then, if a publicly elected official asked "what can I do for you", the answer by most was "nothing. Thanks". Today, the same question is met with "where's my cheque''? In the 1980s and 1990s, the Fed was ushering in an era of disinflation, again a powerful way to expand the market multiple — which it did — as it led to better business decision-making and more efficient resource allocation. Now the Fed is covertly attempting to create inflation so as to monetize our debt morass. Not only was government getting out of our way in the 1980s and 1990s, but the Federal Reserve found its moorings under the legacy of Paul Volcker, and followed years of what can only be described as a sound money policy. We have on our hands today, not just the Fed but many major central banks manipulating interest rates and relative asset values. It is imperative to recognize that as the Fed and ECB act in a manner today that has investors convinced that "tail risks" are being reduced, the cost of these unconventional policy measures are both unknown but very likely far-reaching, and have thereby introduced "tail risks of their own, even if not realized for years down the road. Anyone who does not recognize the extent of the Fed's manipulation in order to generate a positive wealth effect on spending should not be in the wealth management business. Because managing wealth means managing risks... and the Fed and other central banks have merely papered over the debt overhang by printing vast amounts of paper money. Once the inflation does come back, believe me, all hell will break loose, and the law of unintended consequences will rear its head. At that point, the Fed will have no choice but to do some very heavy backtracking and the game will be over. This again is being very forward- looking, to a fault perhaps, but the Fed, once it gets the inflation it so desperately wants, will he slow to respond at first but will end up having to unwind its pregnant balance sheet. One reason why gold bullion and gold mining stocks will prove to have been very effective hedges down the road (but when buying the companies, be very selective). If you are bullish on equities, at least he bullish for the right reason. For the here and now, the correlation is dominated by the size of the Fed balance sheet. From 2000 to 2007, the correlation between the Fed's balance sheet and the direction of the S&P 500 was less than 20%. Since 2007, that correlation has swelled more than four-fold to 86%. This is the missing chapter in the classic Graham and Dodd textbook on value investing, published 80 years ago. So no doubt, Ben Bernanke (as well as Mario Draghi have thought their balance sheet machinations have been able to engineer a buoyant stock market. This is the most crucial determinant of the positive sentiment underpinning valuations at the current time Lord knows, it's not corporate earnings, which are now contracting. Now profits are an absolutely essential driver of the equity market and the downtrend may be one reason why the major averages have basically been range-bound since QE3+ was announced on September 13th (in fact, through the daily wiggles, the interim peak was September 14th). But as high as the historical 70% correlation is between corporate earnings and the equity market, it is still dwarfed by that 86% correlation with the Fed's bloated balance sheet. Call it the "new normal' — a term hardly bandied about any more than "fat tall risks' in those wonderfully prosperous 1980s and 1990s. Just to reiterate — deleveraging, which is necessary and will inevitably blaze the trail for more sustainable organic economic growth in the future, is a dead-weight drag for the here-and-now. In fact, the total debt/GDP ratio, for the past 30 years, has a positive 82% correlation with the trend in equity values. Opinions are one thing, statistical analysis quite another. And common sense. Deleveraging is inherently deflationary. It's a painful process that typically involves years of rising savings rates and depressed growth in domestic demand which then feeds right into the 70% that matters for the equity market which is corporate earnings. The over-riding problem of excessive global indebtedness relative to the income-generating capacity to service the debt remains acute, notwithstanding the "don't-worry-be-happy" market mindset This is why central banks remain in aggressive treatment mode. What else? Well, Rich lays his bullish claim on the classic contrarian signpost of there being rampant pessimism. But is that actually the case? No doubt the latest AAII survey does show that fewer than 30% of individual investors are bullish on the outlook for equities. As I have said time and again, this is not some sort of classic contrarian play It is a deliberate shift in investor attitudes towards how best to diversify the asset mix with an eye towards generating 'risk-adjusted" returns. Meanwhile, many other survey measures actually point to a high level of optimism among those in the financial industry. Market Vane sentiment is 66% bullish, at the high end of the range. The Investor's Intelligence survey shows 43% bulls but only 26% bears. The Rasmussen investor index at just under 100, much like Market Vane, currently sits at the high end of the range for much of this cycle. Beyond the survey evidence, look at the market positioning. The ICI data show that equity mutual fund managers are sitting on 4% cash — the exact same ratio that prevailed at the market peak back in October 2007 (the cash ratio in aggressive growth funds is only 3.5%). Bond fund managers are sitting on 7.6% cash. Managers of hybrid funds have also boosted their cash ratios to 9%. Also look at how the hedge funds have re-positioned themselves in the wake of QE3+ ... It is already evident that when the Fed tells the world that risk-free rates will remain at zero at least semi-permanently, capital will flow to risk assets. After a prolonged period of being cautious, the latest CFTC (Commodity Futures Trading Commission) data show that the net speculative long S&P 500 positions on the CME has swung violently since early September from a net short backdrop of 10,896 contracts to a net long position of a record 18,346 contracts (in both futures and options). In other words, if you are bullish on equities, I wouldn't exactly be using depressed investor sentiment or "money on the sideline" market positioning as a reason. The counterpoint that Rich likes to make is that the cult of equities is dead and this extreme pessimism is a bullish signpost. Sort of like the "Death of Equities' on the front page of BusinessWeek decades ago (though that front cover showed up in 1979, about three years prior to the market trough). There is this view promulgated that whatever the herd effect is in the retail investor space, you want to do the opposite. The problem with that is that in 2007, the individual investor began to pull out ahead of the institutional investor who was slow to raise cash (ostensibly buying into the consensus view of a 2008 "soft landing"... remember that one?). First off, it is not clear when you look at ETF flows, that retail investors have totally abandoned the equity market or have completely shunned risk. For one, based on the numbers I have seen, the 42% weighting that U.S. households have as equities in their overall mix is smack-dab in the middle of the historical range. To be sure, outflows from strict capital appreciation/aggressive growth funds have been large and relentless, but a good part of that has reflected not just a shift towards ETFs but also "hybrid" or balanced funds that focus more on income orientation and less on generating alpha with beta. To be sure, and keep in mind the demographic overlay, there is a secular drive towards bond funds, but the vast majority of that (over $200 billion of net inflow in the past year) has been in "spread product'', mostly corporates. Less than $40 billion have actually flown into "safe" government bond funds. It's not like households are hiding under the table in the fetal position — if that was the case, assets in money market funds would have expanded $90 billion in the past year instead of losing that exact amount What individual investors are doing is a deliberate asset mix shift towards more diversification, less risk, and cash flows.
Finally, in terms of valuation, I would agree with Rich that we are not at extremes. But from my lens, the market is fully priced and with earnings now contracting and record margins being squeezed, the reduced prospect of more multiple expansion is likely to leave the major averages range-bound at best over the near- and intermediate-term. When Rich was the equity strategist at Merrill, he always focused on GAAP reported earnings. I concur. And on that basis, the trailing P/E ratio is now 15.5x. No doubt that is far from the blowout peaks we saw in 2007-08 and in 2000-01, but those were the only two cycles which saw the multiple go to radical extreme nosebleed territory (and look at those two bear markets — one was double the usual decline and the other was more than triple a normal cyclical downturn). But looking at five decades of history, we see that the average multiple at the peak of the market is 16x — we are a half-point from that right now. Of course the average peak multiple is far higher than that (46x), but what should matter for investors is what the multiple normally looks like at the highs for the market. By the time the multiple actually hits its extreme peaks, the market had already rolled over for an average of eight months— because the 'E' falls faster than the 'P', at least initially as companies take the writedown hits early on.
So in a nutshell, I am sure that Rich and I will agree to disagree. From my perspective, there are slices of the stock market that I do like (even if I am not excited for the S&P 500 as a whole). And being a long-time bond hull, it is the part of the equity sphere that behaves like a bond: Dividend growth. Dividend yield (though avoiding traps). Dividend coverage. Corporate bonds. Muni's. Canadian banks. Gold mining stocks (that now pay a dividend!). Energy and energy infrastructure. Consumer Staples. Discount retailers. Beneath the veneer, there are opportunities. But I do not agree that the equity averages have more upside potential than downside risks from today's levels. I do not buy into the view that the fundamentals, valuation metrics, market positioning and sentiment indices are wildly bullish. I do buy into the view that central bankers are your best friend if you are uber-bullish on risk assets, especially since the Fed has basically come right out and said that it is targeting stock prices. This limits the downside, to he sure. but as we have seen for the past five weeks, the earnings landscape will cap the upside. I also think that we have to take into consideration why the central banks are behaving the way they are, and that is the inherent 'fat tail' risks associated with deleveraging cycles that typically follow a global financial collapse. The next phase, despite all efforts to kick the can down the road, is deleveraging among sovereign governments, primarily in half the world's GDP called Europe and the US. Understanding political risk in this environment is critical. And that is my point. It is not about gross nominal returns as much as risk- adjusted returns — now more than ever. Getting it right for clients in the wealth management business means striving every single day to identify the risks, assess the risks, price the risks and then rigorously manage the risks. Having an appreciation of the risks doesn't necessarily make you ultra risk-averse, but what it does is empower you and lead you on the path of making prudent decisions. Richard Bernstein and I may differ on the optimal strategy at the current time to achieve risk-adjusted returns, but I am sure on that last comment we are on the same page. I look forward to his rebuttal!
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| Silver: The Train that Came Back to the Station Posted: 19 Oct 2012 08:30 PM PDT from DayTradeShow:
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| Monetary metals shares ignored futures plunge today, Norcini tells KWN Posted: 19 Oct 2012 08:13 PM PDT 10:10p ET Friday, October 19, 2012 Dear Friend of GATA and Gold: Futures market analyst Dan Norcini notes for King World News tonight that though gold and silver futures prices were down hard today, monetary metals mining shares rose. Norcini provides a chart of the HUI mining share index that seems to be showing a bullish flag pennant. An excerpt from the interview is posted at the King World News blog here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/10/20_I... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Opinion Around the World Is Changing When Deutschebank calls gold "good money" and paper "bad money". ... http://www.gata.org/node/11765 When the president of the German central bank, the Bundesbank, pays tribute to gold as "a timeless classic". ... http://www.forbes.com/sites/ralphbenko/2012/09/24/signs-of-the-gold-stan... When a leading member of the policy committee of the People's Bank of China calls the gold standard "an excellent monetary system". ... http://www.forbes.com/sites/ralphbenko/2012/10/01/signs-of-the-gold-stan... When a CNN reporter writes in The China Post that the "gold commission" plank in the 2012 Republican platform will "reverberate around the world". ... http://www.thegoldstandardnow.org/key-blogs/1563-china-post-the-gop-gold... When the Subcommittee on Domestic Monetary Policy of the U.S. House of Representatives twice called on economist, historian, and gold standard advocate Lewis E. Lehrman to testify. ... World opinion is changing in favor of gold. How can you learn why and what it will mean to you? Read the newly updated and expanded edition of Lehrman's book, "The True Gold Standard." Financial journalist James Grant says of "The True Gold Standard": "If you have ever wondered how the world can get from here to there -- from the chaos of depreciating paper to a convertible currency worthy of our children and our grandchildren -- wonder no more. The answer, brilliantly expounded, is between these covers. America has long needed a modern Alexander Hamilton. In Lewis E. Lehrman she has finally found him." To buy a copy of "The True Gold Standard," please visit: http://www.thegoldstandardnow.com/publications/the-true-gold-standard Join GATA here: 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 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/.
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| Social Media Bombs: Wells Fargo “Facebook-Bombed” By Hundreds of Messages in New Type of Activism Posted: 19 Oct 2012 07:40 PM PDT from Silver Vigilante:
The National People's Action organized "Storm Wells Fargo Facebook Day" and hundreds of people partook. The focus of the action was to confront Wells Fargo for investing millions of dollars into private prisons. Of course, private prisons are a rapidly growing in the US as the slave population will need plantations to provide them food and menial labor to do. What the group did was organize individuals who were to post on Wells Fargo's website protesting the afore-stated dollar investments into private prisons. This is a novel tactic, one I had not yet heard of, and I believe this tactic could be expanded upon and as effective as the cyber-attacks used by hacker groups.
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| German Industrialist: Insolvency Procrastination And How To Confront The Coming Inflation Posted: 19 Oct 2012 07:12 PM PDT Wolf Richter www.testosteronepit.com www.amazon.com/author/wolfrichter It was a blatant act of fear mongering just before the EU Summit: if Greece were allowed to default and exit the Eurozone, it could trigger the exits of Portugal, Spain, and Italy, which, in a worst-case scenario, could cost the world economy €17.2 trillion in economic growth. “Hence it is incumbent upon the community of nations to prevent Greece from a sovereign default as well as leaving the euro, and the domino effect that this event could induce,” the study urged. The study was commissioned by the politically powerful Bertlesmann Foundation, which owns 77.6% of Bertelsmann SE & Co., a multinational media company based in Germany. The foundation is known for its agenda—now including the doctrine that taxpayers must always bail out certain bondholders in order to prop up confidence in the financial markets. “Insolvency procrastination” is how a quintessential German industrialist responded. And if after Greece’s exit, the whole Eurozone dissolved? “To throw good money after bad is something that normally only over-indebted businesspeople do,” he said. “It’s irresponsible.” Tough words for the EU Summit crowd. Heinrich Weiss, Chairman and CEO of SMS Holding GmbH, didn’t mince words as he laid out his euro pessimism in an interview with Manager Magazin. SMS is, in a sense, a microcosm of the German export economy. The family-owned company has about 10,500 employees. Its subsidiaries excel in mechanical engineering, machine tools, and plant construction for processing steel, aluminum, and nonferrous metals. Some of the items it manufactures are so heavy that getting them to the port can be a headache, given Germany’s aging bridges and infrastructure constraints. And it exports: 57% of its orders came from Asia, 28% from Europe and Russia, 14% from the US, and 1% from Africa. During the financial crisis, its order intake collapsed by 55%, from €5.3 billion in 2008 to €2.3 billion in 2009. Then orders recovered, reaching €3.4 billion in 2011 (annual report). During bad times, the company lives off its order backlog. It was €6.3 billion in 2008. In 2009, SMS ate up 26% of its order backlog, and in 2010 reduced it further to €4.5 billion. In 2011, it recovered a bit. Due to the order cushion in 2008, sales actually increased during the worst part of the financial crisis, from €3.6 billion in 2008 to €3.9 billion in 2009—but then, the order drop-off caused sales to plummet to just over €3 billion in 2010 and 2011. The business is cyclical, with ups and downs every two or three years, Weiss explained. After the few good years recently, a downturn would be expected. “But I’m afraid that this one will be deeper and longer than we have become used to,” he said. Since over 80% of the company’s revenues came from outside the Eurozone, he expected that SMS would be able to ride out the debt crisis unscathed. But over the summer, their customers worldwide became “more reticent”—and postponed projects. The debt crisis had begun to impact the rest of the world [also read.... The Noose Tightens On Germany’s “Success Recipe”]. The bond-buying program by the ECB and the establishment of the ESM bailout fund may have calmed the waters, but “as citizen and family entrepreneur,” he was convinced the calm would be temporary, and things would get worse. Why? The “inflation trap,” he said, there being nothing more “anti-social” than inflation. Consumers would be in a tough spot. Due to the existing “Transfer Union,” it’s “certain today that the standard of living in Germany cannot be maintained.” When citizens feel the loss of wealth due to these transfers to Germany’s neighbors and due to rising inflation, domestic demand for consumer goods would “shrivel over the medium term.” But stimulus programs with borrowed money would be “the last thing we can afford,” he said, calling it a “scandal” that Germany hasn’t been able to reduce its debt despite “record tax revenues.” To get through the crisis, SMS would do three things, he said: remain “at the top of its sector,” maintain a financially conservative approach to be able to live off its reserves, and.... “prepare for inflation.” His strategy: invest a big part of their free liquidity “in industrial substance.” All inflationary times have proven that those who invested in substance, for example in well-run companies, had “fewer losses,” he said. So they’re looking for acquisitions. And the next 12 months? SMS was currently using overtime to keep up, he said, but with orders for 2012 dropping to €3 billion, capacity utilization will fade, and the company might have to shift to part-time work (Kurzarbeit) next year. He couldn’t give a forecast; the situation was “too uncertain,” he said, but for 2013, “we’re pessimistic.” Two thermometers into corporate brains plunged to depth not seen since the trough of the financial crisis when the US was losing hundreds of thousands of jobs a month. One was based on responses from CEOs of America’s largest corporations; the other was based on responses from analysts and their industry contacts. Just before Lehman, these people had exactly zero predictive capabilities. So, could they now have ulterior motives? Read.... Fear of Impending Economic Collapse Or Just Manipulation? And here is an insightful read by energy expert, Marin Katusa: Will Iran’s Runaway Inflation Spark an Oil Bull Market?
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| Goldman Sachs' Ian Preston Surveys the Gold ETF vs Equity Battleground Posted: 19 Oct 2012 07:05 PM PDT Gold equities are in competition with gold ETFs for shareholder dollars. In this exclusive Gold Report interview, Goldman Sachs Managing Director Ian Preston discusses the steps gold companies must take to pull investors back from the ETF space and shares Goldman Sachs' outlook for the gold price over the next year or so.
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| The Gold Price Gave Back $35.20 this Week How Far Will it Fall? Posted: 19 Oct 2012 06:16 PM PDT Gold Price Close Today : 1,722.80 Gold Price Close 12-Oct : 1,758.00 Change : -35.20 or -2.0% Silver Price Close Today : 32.07 Silver Price Close 12-Oct : 33.63 Change : -1.56 or -4.6% Gold Silver Ratio Today : 53.715 Gold Silver Ratio 12-Oct : 52.270 Change : 1.44 or 2.8% Silver Gold Ratio : 0.01862 Silver Gold Ratio 12-Oct : 0.01913 Change : -0.00051 or -2.7% Dow in Gold Dollars : $ 160.11 Dow in Gold Dollars 12-Oct : $ 156.73 Change : $ 3.38 or 2.2% Dow in Gold Ounces : 7.745 Dow in Gold Ounces 12-Oct : 7.582 Change : 0.16 or 2.2% Dow in Silver Ounces : 416.04 Dow in Silver Ounces 12-Oct : 396.30 Change : 19.73 or 5.0% Dow Industrial : 13,343.51 Dow Industrial 12-Oct : 13,328.85 Change : 14.66 or 0.1% S&P 500 : 1,433.19 S&P 500 12-Oct : 1,428.59 Change : 4.60 or 0.3% US Dollar Index : 79.633 US Dollar Index 12-Oct : 79.689 Change : -0.056 or -0.1% Platinum Price Close Today : 1,613.00 Platinum Price Close 12-Oct : 1,657.10 Change : -44.10 or -2.7% Palladium Price Close Today : 623.30 Palladium Price Close 12-Oct : 637.95 Change : -14.65 or -2.3% The GOLD PRICE cascaded down $20.50 to $1,722.80 while silver waterfalled 76.5 cents to 3207.3c. Ranges were $1,738.9 - $1,715.89 and 3276.5c - 3192c. Ponder the GOLD/SILVER RATIO When metals are rallying, it falls (because silver usually outperforms gold) and when they are correcting it rises. Right now, it's rising. Closed last week at 52.270 but today at 53.715, up 2.8%. Today it filled the gap left behind on the way down, and nearly closed above its 200 DMA. I haven't mentioned it before, but another gap stands at the beginning of the August rally, when the ratio leapt from 57 to 56.5. Yes, it is possible that gap, too, might be filled. $1650 gold at a 57:1 ratio puts silver at 2895 cents. Not predicting, just mathematicizing. The GOLD PRICE has now touched its 50 DMA ($1,720 today) which certainly MIGHT fulfill a correction target. A 38.2% correction would end about $1,718, a 50% about $1,693. Yet below that the 150 and 200 DMAs stand at $1,648.52 and $1,662.39, along with lateral support smeared from $1,650 to to $1,680. Confused markets don't rise, and now bewilderment beclouds the horizon: currency turmoil, weak dollar/strong dollar, presidential election. That sky will clear, but meanwhile the storm. The SILVER PRICE fell through its 50 DMA (3246c) today to its 300 DMA (3205c), but closed barely above that at 3207.3c. The 300 Day Moving Average acts for silver as the 200 DMA acts in other markets. After breaking above the 300 in September's first days, it was to be expected silver would return for a last kiss good-bye. That's how it's behaved before during this bull market. The 200 DMA stands beneath at 3094c, and that's an often seen target of corrections. Today's close fulfilled a 38.2% correction, and 3112c will fulfill a 50%. Of course, volatile silver often overshoots, so don't overlook the 61.8% correction to 3013c. If all also fails, there's a floor at 2840c. Whoa! Put that pistol down. I'm only the messenger. Besides, it's not enough to get bothered about. This correction won't last much longer than the election, and even in the unlikely event Romney wins, will reverse by endo-November latest. What do you call a dinosaur with an extensive vocabulary? A thesaurus. Last week's confusion broke this week. Stocks tried to rally, but failed wretchedly. Dollar index probed lower, but climbed back up to unchanged. Metals took a beating all around, and silver took the worst bruising. Euro tried to climb but fell back with only 0.55% gain to its credit. Yen lost 1.1%, big move for a currency. Once again European Union leaders have firmly decided to re-decide everything decided shortly before without taking any action, even the sort of goofy action you expect from statists and Keynesians and socialists. They can only make up their minds to consider and re-consider. This equates to pure strychnine for markets, for all markets hate uncertainty. Thus even US stocks were kneecapped, the euro made no headway for the week, and the dollar begins to look not so bad after all. After all, it's late, and the bar is closing. Let us stand back and take a long term view -- really long term, about 350 years or since 1650 when the centralizing trend really took hold in creating national states. Yes, there is a "primary trend" in society as well as markets. That trend has been rolling over since about 1980. Conventional war's cost has made armies like those of the 1940s impossible -- witness the 4th generation guerilla warfare of the last 45 years. Viet Nam, Iraq, Kosovo, Afghanistan -- armor and paratroops won't work. Now the national state's economic system has begun irretrievably faltering. Worse yet, the ultimate centralization -- the empires into which the national states have been fondued -- are stumbling. Soviet Union's gone, USA is overstretched in 130 countries around the world and dead broke, European Union is flying apart of its own volition. National states and empires have had passed their prime. The process of decentralization in human affairs, including the economic, began with the Viet Nam era and is proceeding rapidly. Even if growing popular opinion weren't on its side, centralization can no longer keeps its promises and will alienate even more. Ask anybody under 30 whether he believes centralized power is better than decentralized. They young have already decided. The future will be decentralized. Power will flow away from centers to the periphery, and not a moment too soon. We are now in the worst turmoil, that change where the old is fighting not to give way to the new, and the new is not yet strong enough to take control. The future belongs not to empires, but to secession, to affinity tribes, to small nations. The giant national state is dead for another 300 years. Meantime, while the elephants battle, we ants must hide. Currencies today stand at US$1 = Y79.28 = E0.7678. That lying US dollar index, like a trashy girl, lied about breaking down and turned around and gave us a big kiss. (I won't miss it when it's gone.) Didn't close the week higher, but cast dark cloudy doubt on any further fall. It closed 29 basis points higher today at 79.633. This left behind a rounding bottom Wednesday and Thursday, and victoriously pierced the 79.40 lip of that bowl. Unless it falls below that 79.40 next week, the dollar will climb. Stocks simply collapsed today, sinking, sinking, sinking. Dow lost -- WHOA! -- 205.43 points (1.52%) and closed at 13,343.51. S&P500 shucked even more percentagewise, 1.66% or 24.15, ending at 1,433.19. Friends, boys and girls, ladies and gentlemen, this dragged the Dow to a close beneath its 50 DMA (13,353), erasing the last five days' gains. If it continues to plunge, the next support stands at 13,250. A close below that pulls the trip rope on Madame Guillotine. I got a note from the printer today that At Home in Dogwood Mudhole ought to ship on 24 October, which puts them here about the 29th. We'll start shipping then. Thanks very much for your orders and generous patience. If you don't want to wait for a hard copy, the digital versions of At Home in Dogwood Mudhole are ready. You can purchase AHIDM in PDF, Kindle, or e-Pub format for $16.95 at http://store.the-moneychanger.com/products/at-home-in-dogwood-mudhole-vol1 I can't figure out how to autograph the durned thing, so it won't do you any good to ask. It has plumb defeated me. Y'all enjoy your weekend. Argentum et aurum comparenda sunt -- -- Gold and silver must be bought. - Franklin Sanders, The Moneychanger The-MoneyChanger.com 1-888-218-9226 10:00am-5:00pm CST, Monday-Friday © 2012, The Moneychanger. May not be republished in any form, including electronically, without our express permission. To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $3,130.00; silver's primary is up targeting 16:1 gold/silver ratio or $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate bubble has burst, primary trend down. WARNING AND DISCLAIMER. Be advised and warned: Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures. NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps. NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced. NOR do I recommend buying gold and silver on margin or with debt. What DO I recommend? Physical gold and silver coins and bars in your own hands. One final warning: NEVER insert a 747 Jumbo Jet up your nose. No, I don't. 
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| Gold and Silver Disaggregated COT Report (DCOT) for October 19 Posted: 19 Oct 2012 05:59 PM PDT Time is short to register for New Orleans. Details below. HOUSTON -- This week's Commodity Futures Trading Commission (CFTC) disaggregated commitments of traders (DCOT) report was released at 15:30 ET Friday. Our recap of the changes in weekly positioning by the disaggregated trader classes, as compiled by the CFTC, is just below. In the DCOT table above a net short position shows as a negative figure in red. A net long position shows in black. In the Change column, a negative number indicates either an increase to an existing net short position or a reduction of a net long position. A black figure in the Change column indicates an increase to an existing long position or a reduction of an existing net short position. The way to think of it is that black figures in the Change column are traders getting "longer" and red figures are traders getting less long or shorter. All of the trader's positions are calculated net of spreading contracts as of the Tuesday disaggregated COT report. Vultures, (Got Gold Report Subscribers) please note that updates to our linked technical charts, including our comments about the COT reports and the week's technical changes, should be completed by the usual time on Sunday (by 18:00 ET).
We don't know how he does it, but Brien manages each year to bring in top financial and resource-related talent. The world is facing very vexing and potentially game changing challenges today and in the near future. Navigating the stormy global seas and protecting our wealth and purchasing power just ahead will be the challenge of a lifetime if the signals we see developing continue. This year's event is billed: "Profits and Safety During Global Chaos." An apt title if you ask us. We believe people would do well to listen to the council and advice that this year's faculty will be sharing with NOIC attendees, just ahead of Governor Romney's landslide victory. This year's faculty includes: "Sarah Palin, Dr. Charles Krauthammer, Rick Santelli, Dr. Marc Faber, Peter Schiff, Doug Casey, Rick Rule, and Stephen Leeb. Plus: Bob Prechter, Brent Cook, Adrian Day, Lawrence Roulston, Louis James, Marin Katusa, Mark Skousen, Steven Hochberg, Frank Holmes, Ian McAvity, Mary Anne and Pamela Aden, Gene Arensberg, Thom Calandra, Scott Gibson, Keith Schaefer, Robert Meier, Bill Murphy, Chris Powell and more. There will also be a large number of resource related companies exhibiting there and your editor will be giving a tour of several chosen by the organizers. The conference gets started next week on Wednesday, October 24 and runs through Saturday, the 27th. We understand there may still be an opening in the very elegant host hotel, the New Orleans Hilton Riverside, which has a terrific view of the Mississippi River and is just a short walk from New Orleans' storied French Quarter with all its sights, sounds, great food and quaint classic architecture. If not still available, there are other nearby hotels.
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| The Spain Relief Rally is About to End Posted: 19 Oct 2012 03:28 PM PDT
As I noted previous articles, Spain has essentially three options:
Thus far Spanish Prime Minister Rajoy has opted to go for #1. The end result has been riots, protests, and now the threat of Spain as a country breaking up. I’ve long averred that Spain will bring about the break up of the Euro. By the look of things, we’re not far from this.
To whit, as the above article notes, Germany, Holland, and Finland have decided to pull back on the promise of a €100 billion Spanish bank bailout first established in June. These countries are now stating that this bailout should be included as part of the ESM mega-bailout fund’s banking program that could take years to implement.
Spain doesn’t have time for this. As I’ve noted before, Spain is facing a full-scale bank run (Spaniards pulled another €17 billion from Spanish banks in August, bringing the year to date bank run to over 18% of total Spanish bank deposits).
Now add multiple regional bailout requests, as well as 25% total unemployment to the mix and Spain is an absolute disaster. The Spanish Ibex knows it too:
Congratulations Mario Draghi, you promised unlimited bond buying and you bought less than one month’s worth of gains for Spain. If you want proof positive that Central Banks are losing their grip on things, the above chart is it. The moment we take out that trendline again, it’s GAME OVER (what more can the ECB promise?)
Remember, Spain is currently drawing over €400 billion from the ECB.
Let’s put this number in perspective… in June before Spain requested a €100 billion bailout, the country was drawing only €300 billion from the ECB.
Since that time and now, the ECB has promised to provide unlimited bond buying… and even Germany has indicated it would be open to some sort of a Spanish bailout…
And yet, Spain is now borrowing even MORE than it was in June.
This is not progress in any way… if anything it indicates that things are worsening in the EU’s financial system at a staggering pace. The powers that be are keeping things calm until after the election… at which time there will be absolute hell to pay.
On that note, if you’ve yet to prepare for Europe’s BIG collapse…we’ve recently published a report showing investors how to prepare for this. It’s called What Europe’s Collapse Means For You and it explains exactly how the coming Crisis will unfold as well as which investment (both direct and backdoor) you can make to profit from it.
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Best Regards,
We also offer a FREE Special Report detailing the threat of inflation as well as two investments that will explode higher as it seeps throughout the financial system. You can pick up a copy of this report at:
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| Turk's chart shows gold going exponential against four major currencies Posted: 19 Oct 2012 03:17 PM PDT 5:10p ET Friday, October 19, 2012 Dear Friend of GATA and Gold: Despite the paper games played on the futures exchanges today, GoldMoney founder and GATA consultant James Turk says, gold remains in an exponential upward trend against the U.S. dollar, euro, British pound, and Swiss franc, and he has the chart to prove it. Turk writes: "This chart is what people need to think about after a week like this one, which in fact is barely noticeable. That's what I mean about the big picture, staying with the trend, and disregarding the short-term ups and downs. This chart says we are headed for currency destruction, which is confirmed by central bank QE policies that are now in place pretty much worldwide." An excerpt from the interview with Turk is posted with the chart at the King World News blog here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/10/19_T... CHRIS POWELL, Secretary/Treasurer 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 Join GATA here: 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 Intercepts Best Pt+Pd+Au Grades Yet Company Press Release VANCOUVER, British Columbia -- Prophecy Platinum Corp. (TSX-V: NKL, OTC-QX: PNIKF, Frankfurt: P94P) announces more results of its 2012 drill program on the company's fully-owned Wellgreen platinum group metals, nickel, and copper project in southwestern Yukon Territory, Canada. Four surface holes and four underground holes all intercepted significant mineralized widths, ranging from 28.5 meters (WS12-201) and up to 459.5 metres (WS12-193). Highlights include WU12-540, which returned 8.9 metres of 5.36 grams per tonne platinum, palladium, and gold; 1.73 percent copper; and 1.01 percent nickel within 304.5 meters of 0.66 g/t platinum-palladium-gold, 0.20 percent copper, and 0.27 percent nickel. The surface drill program started in June and has completed 16 holes (assays pending for 12 holes) with two rigs now on site. The surface program continues to progress at a steady pace. Prophecy Chairman John Lee commented: "Wellgreen is a very large nickel, copper, and platinum group metals project with near-surface high-grade zones. High-grade intercepts will be incorporated into resource modeling and mine planning in the pre-feasibility study. We expect further positive drill results from Wellgreen shortly." Wellgreen features a low 2.59-to-1 strip ratio, is situated at an altitude of 1,300 meters, and is only 15 kilometers from the two-lane paved Alaska Highway. Those factors significantly minimize the project's indirect costs. For the complete company statement with full tabulation of the drilling results, please visit: http://prophecyplat.com/news_2012_sep11_prophecy_platinum_drill_results....
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| Gold Daily and Silver Weekly Charts Posted: 19 Oct 2012 02:57 PM PDT |
| Today's Redbull-Sponsored Market Plunges By Most In 4 Months Posted: 19 Oct 2012 02:09 PM PDT
Late-day surge pulls Dow back from the brink of weekly redness...but not the NASDAQ...
S&P futures plunged after-hours to the day's lows...on heavy volume...
S&P futures pulled back to the 50DMA and hover at a key trendline (off the May lows) - in the middle of the Bernanke-Draghi-Divide...
AAPL's largest 3-week decline since the March 2009 lows...
S&P Sectors post-QEtc...
Credit markets appear to have suffered a somewhat 'epic' short squeeze midweek and have been nervous to re-enter short - Monday will be interesting...
VIX was trampled at the close in an effort to ramp stocks we would suggest but that failed and it ends well above (below on the chart) QEtc. levels...
Gold, Copper, and Oil all huddled together this week - while Silver lagged...
Even as the USD ended the week unch...
Risk assets in general stabilized at the close but the weakness was very systemic...
On the year, Gold and Silver remain the winners...
Charts: Bloomberg and Capital Context
Bonus Chart: How over 200 hedge funds felt today...
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| Platinum Price May Outperform Gold and Silver As Strike In South Africa Intensifies Posted: 19 Oct 2012 02:02 PM PDT |
| Gold drops over $20 an ounce, loses 2% on week Posted: 19 Oct 2012 01:44 PM PDT 19-Oct (MarketWatch) — (MarketWatch) — Gold futures dropped more than $20 an ounce Friday to tally a 2% weekly loss as some disappointment over recent corporate earnings, U.S. economic data and the latest European summit drove gains for the U.S. dollar. "Fear of the future in the U.S. and in the euro-zone (fiscal cliff and debt crisis) is an undercurrent in all markets, including precious metals" for now, said Julian Phillips, South Africa-based founder and writer at GoldForecaster.com. "Gold may slip below $1,700 for a brief time, before rebounding." … "Gold remains defensive going into the weekend after a catalyst to drive the yellow metal above important resistance at $1,800/$1,802.89 failed to materialize," said Peter Grant, chief market analyst at USAGOLD. "Disappointing U.S. earnings are adding additional weight to equities, which is resulting in some deleveraging pressures," he said. "Such pressures tend to support the dollar, and at least initially, suppress gold." … "Another generally disappointing [European Union] summit that once again failed to address the underlying imbalances is weighing on the euro and European stocks, amid heightened risk aversion," said USAGOLD's Grant. "The agreement to make the [European Central Bank] the supervisor of euro-zone banks by year-end is being touted," said Grant, "but the market clearly doesn't share the enthusiasm of French President Hollande, who declared last night, 'Tonight, I have the confirmation that the worst is behind us.' " [source]
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| COT Gold, Silver and US Dollar Index Report - October 19, 2012 Posted: 19 Oct 2012 01:32 PM PDT COT Gold, Silver and US Dollar Index Report - October 19, 2012
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| Posted: 19 Oct 2012 12:19 PM PDT Gold Falls to Six-Week Lows
Better than expected US and Chinese economic data this week, temper expectations of further central bank accommodations. Uncertainty also continues to rise regarding who will win the US Presidential election in just over two-weeks, and the implications for leadership and policy continuity at the Fed. Republican challenger Mitt Romney has pledged to replace Ben Bernanke as chairman of the Fed if he becomes President. Another generally disappointing EU summit has concluded, which once again failed to address the underlying imbalances at the core of the eurozone debt crisis. The euro and European stocks were pressured, amid heightened risk aversion. An agreement to make the ECB the supervisor of eurozone banks by year-end is being touted, but the market clearly doesn't share the enthusiasm of French President Hollande who declared, "Tonight, I have the confirmation that the worst is behind us." US equities are getting slammed as well, on the 25th anniversary of 'Black Monday', weighed by disappointing corporate earnings and persistent growth risks (despite this week's encouraging data points). This is resulting in some deleveraging pressures. Such pressures tend to support the dollar, and at least initially, suppress gold. Gold is proving far more resilient than silver on this decline. I suggested in commentary several weeks ago that the gold/silver ratio was trying to form a bottom below 51, in light of rising global growth risks. The ratio set a new seven-week high of 53.77 today, nearly 7% off the recent low.
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| Posted: 19 Oct 2012 11:43 AM PDT Jim, This is the second post in as many days from Gross. Yes of course he is talking his own book, but I think his level of concern for the future of the USD/US debt situation is real…. CIGA David A. Bill Gross says only gold and real assets will thrive in fiscal 'ring Continue reading Jim's Mailbox
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| Billionaire Frank Giustra: Gold is the Mother of All Bubbles, Which is Why You Should Buy It Posted: 19 Oct 2012 11:30 AM PDT "We are no further along the path to the resolution of the situation that currently exists in both silver and gold" ...
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| Western World Spends More on Dog Food & Manicures Than on Silver! Posted: 19 Oct 2012 11:28 AM PDT The price of silver is inelastic. The price of silver has little bearing on its utility. At $33 an ounce, it is still very cheap as an industrial commodity. As vital as silver is to the solar, electronic, medical and … Continue reading
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| Posted: 19 Oct 2012 11:28 AM PDT Jim Sinclair's Mineset My Dear Extended Family, Jim, Happy to have brought a smile to you yesterday. Days can be long and trying at times, so a laugh is welcomed. I have hesitated for weeks to write this but I am not in sync, so here I go. The action in the 'Crimex' this week was not unexpected. The political demands and possible (a hair's breathe from) commercial signal failure, meant the paper gold printing machines would be pushed to emptied toner cartridges. As said, not unexpected. Temporary but not unexpected. My head scratching comes from the question, where does the 'physical' metal come from to satisfy the growing buy stops hit as price comes down? And to piggy back on this question, do foreign entities, Central Banks , and investors 'take' delivery; in other words, leave the Bullion System with the metal? Or does it sit in their care? (lol) Realizing they are 'Bullion Banks', could you step through how they receive their physical m...
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| Gold Price Falls Sharply, Europe Disappoints Posted: 19 Oct 2012 11:27 AM PDT |
| LGMR: Gold's Fall Blamed On "Speculative Sellers", European Politicians "Papering Over Differences" Posted: 19 Oct 2012 11:27 AM PDT London Gold Market Report from Ben Traynor BullionVault Friday 19 October 2012, 08:00 EDT THE SPOT gold price traded lower to $1732 an ounce Friday morning in London, near one-month lows, while stock markets and the Euro also fell as a two-day European summit came to a close with several issues unresolved. The gold price in Euros meantime sank to its lowest level since the end of August at €42,647 per kilo (€1326 per ounce). Heading into the weekend, the Dollar gold price looks set for its second successive weekly fall, the first time this has happened since May. "We hold selling by speculative financial investors responsible for the price slide," says today's Commodities Daily note from Commerzbank. "In recent weeks they had strongly built up their positions and may now be seeing themselves forced to take profits given the faltering upswing." The silver price also fell this morning, hitting a six-week low at $32.26 per ounce. Most other commodities saw gains, with the...
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| The Outrageous and Totally Legal Threat to Your Wealth Posted: 19 Oct 2012 11:26 AM PDT October 19, 2012 [LIST] [*]Lose your cash, lose your property, lose your retirement: "Civil asset forfeiture" and the threat it poses to your wealth [*]Fiscal cliff? More like a fiscal "abyss," says I.O.U.S.A. protagonist David Walker [*]Another megabank sees a shift to physical gold, while Sprott pinpoints opportunities in gold equities [*]The world's most anticlimactic stock market forecast [*]Readers weigh in on the "SWATification" of America, and a secession movement that might have succeeded... [/LIST] At age 68, Russ Caswell is on the verge of losing the business that's been in his family for two generations. And it's not for lack of customers. Mr. Caswell is another object lesson that "If you've done nothing wrong, you have nothing to worry about" no longer applies. On Nov. 5, a federal trial will begin with the curious name of United States of America v. 434 Main Street, Tewksbury, Massachusetts. The defendant is not Mr. Ca...
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| Silver Fails at 32.50 Support, Attempting to Hold at $32 Posted: 19 Oct 2012 11:11 AM PDT [url]http://www.traderdannorcini.blogspot.com/[/url] [url]http://www.fortwealth.com/[/url] You can see on the weekly chart that silver failed (once again) to extend through stubbornly strong overhead resistance near $35. Having done so, it is now setting back as speculative longs are getting flushed out. Additionally, fresh shorting is occurring. The metal looks like it wants to drift lower yet unless it can pop back over $32.50 before the weekly trading ends. If it does not, odds favor a move down towards the 50 week moving average near the $31 level. That would put it back near the middle of the very broad trading range that it has been stuck in for more than year now and effectively leave it in limbo for a while. Clearly the market lacks the necessary impetus to drive it higher through the stiff selling originating at the $35 level. The question is at what level it will find enough solid buying to set a floor. ...
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| Turk - One Of The Most Important Gold Charts Ever Posted: 19 Oct 2012 11:08 AM PDT  Today James Turk sent King World News one of the most important gold charts ever. The charts reveals that despite recent weakness, "Gold is in an exponential upward trend." Turk also added: "This is exactly the pattern that you see when a currency is heading toward hyperinflation, and this chart shows all four currencies headed that way." Here is what Turk had to say in this King World News exclusive, along with his incredibly powerful chart: "I think John Embry got it exactly right in his KWN interview this week, Eric. John made the point about the US election coming up and the effort to make everything look as good as possible. We already saw that happen earlier in the month when the questionable unemployment number was released."
This posting includes an audio/video/photo media file: Download Now |
| Is The October Correction in Gold Already Over? Posted: 19 Oct 2012 10:41 AM PDT In today's essay on the current correction in gold we would like to focus on one single question: Is the correction in gold over? Read More...
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Wells Fargo has banned hundreds of individuals from their Facebook page for protesting the banks investments into private prison companies and thus profiting upon one of the biggest markets in the US: it's prison system. The event marks the first time the "Social Media Bomb" technique of activism has been deployed to such a degree, and it has left Wells Fargo a bit shaken.
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