saveyourassetsfirst3 |
- Global Silver Market Surplus up to 300M oz in 2012
- Peter Schiff: Dollar Collapse Before Obama's Out
- First Majestic Earns $24.9M in Third Quarter; Revenues of $63.6M, an Increase of 4%
- Argonaut Gold Announces Q3 2012 Revenue of $72.9 Million & Net Income of $27.2 Million Earnings Per Basic Share of $0.29
- Gold’s Relative Strength and What it Means
- ECB : gold and gold receivables remain unchanged
- Jeffrey Tucker: Future of private money
- China gold demand seen at record high
- This Is A Moment In Time That’s Never Been Seen Before
- Global Gold Production Is Poised To Fall Off A Cliff
- Northern Tiger Resources Samples 8.5 g/t Gold over 6.8 Metres at Sprogge Project, Yukon
- Bart Chilton On Silver Manipulation - Gold and Silver Coiling For a Major Move - The Next Disaster
- $1803 Is Where Gold Would Come Alive
- Thank you, Lord Barry!
- Pay Me In Gold: Lawmaker Requests Compensation In “Money That Has Intrinsic Value”
- ‘King Dollar’ hard to dethrone
- On Russia Today's 'Capital Account'...CFTC's Chilton Repeats Belief in Silver Market Manipulation
- Butler sees silver's price appreciation potential far greater than gold's
- The Telegraph: Silver price to 'increase 400pc in three years'
- Global silver market surplus to edge up to 300m ounces in 2012 – GFMS
- Gold & the Dollar are Less Correlated than Everyone Thinks
- The CBO’s Latest Con Job: Disappearing Data to Deter Analysis of its Deficit Scaremongering
- Put 10% of your assets in gold and pray it doesnt work.
- Turkish prime minister says gold should replace dollar
- Australian LNG Projects Get Pricey
| Global Silver Market Surplus up to 300M oz in 2012 Posted: 14 Nov 2012 12:11 PM PST This guy agrees with the Debbie Downer thread.... No $50 Silver for a while http://www.miningweekly.com/page/americas-home | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Peter Schiff: Dollar Collapse Before Obama's Out Posted: 14 Nov 2012 12:01 PM PST By Hard Assets Investor: Interview conducted by Olly Ludwig Peter Schiff, president and chief global strategist of Euro Pacific Capital, is more than a little bit concerned about President Obama's re-election. Ever the provocateur, Schiff believes that the president is a socialist who was essentially elected by people who want free things—the perfect bedfellows for a Federal Reserve he argues is bent on debasing the dollar. What does it all point to? Looking at earlier predictions of his that gold could reach as high as $5,000 a troy ounce from a dollar perspective, Schiff says it's time to pay the piper, and said the greenback will almost surely collapse during Obama's second term, as a whole lot of bad economic policy comes to a head. Ludwig: Before getting too deeply into the implications of Obama's re-election, did you see any difference between what a Romney presidency would have meant to the U.S. economy vs. Complete Story » | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| First Majestic Earns $24.9M in Third Quarter; Revenues of $63.6M, an Increase of 4% Posted: 14 Nov 2012 10:01 AM PST FIRST MAJESTIC SILVER CORP. (AG: NYSE; FR: TSX) (the "Company" or "First Majestic") is pleased to announce the unaudited condensed interim consolidated financial results for the Company for the third quarter ending September 30, 2012. The full version of the financial statements and the management discussion and analysis can be viewed on the Company's web site at www.firstmajestic.com or on SEDAR at www.sedar.com and on EDGAR at www.sec.gov. 2012 THIRD QUARTER HIGHLIGHTS
2012 THIRD QUARTER HIGHLIGHTS TABLE
(1) Payable Silver Ounces Produced is equivalent to Silver Ounces Produced less metal deductions from smelters and refineries. Keith Neumeyer, President and CEO of First Majestic, states, "With the successful integration of the La Guitarra Silver Mine in the third quarter, First Majestic is now one step closer at reaching its senior producer status. By the end of this year, the Company will have a total of five producing silver mines. Production costs at La Guitarra came in better than expected at $65 per tonne and further cost reductions are anticipated by the end of the year. In addition, the adoption of La Guitarra further enhances First Majestic's strategy of remaining the purest silver producer on the world." FINANCIAL HIGHLIGHTS
IN SUMMARY Total ore processed in the quarter reached 666,688 tonnes, an increase of 26% compared to the third quarter of 2011. The increase in milled ore is a direct result of the successful plant expansion at La Parrilla and the additional ore processed at newly acquired La Guitarra Silver Mine. The overall average head grade for the third quarter of 2012 was 167 grams per tonne ("g/t"), a 3% increase compared to 164 g/t in the second quarter. The increase was attributed to the addition of the La Guitarra mine, which had an average head grade of 225 g/t for the quarter. Since taking over operations of the La Guitarra mine on July 3, 2012, management has been focusing on improving the operational efficiency and cost savings. During the third quarter of 2012, total production at La Guitarra was 237,803 equivalent ounces of silver,10% higher than in the prior quarter, and 40% higher than the third quarter of 2011. In addition, average production cost per tonne for the third quarter was $65.09 per tonne, 49% lower than the prior quarter, and 44% lower than the third quarter of 2011. Production from La Guitarra accounted for approximately 10% of First Majestic's total production during the third quarter of 2012. Combined recoveries for all mines in the third quarter was 62% compared to 53% in the third quarter of 2011 and 59% in the second quarter of 2012. Since installing a new ball mill at La Encantada in mid-April, recoveries have been consistently improving due to a higher proportion of fresh ore being processed and a better mixture with the tailings of Dam #1. Although, the tailings of Dam #1 have lower grades, processing from Dam #1 has historically resulted in better recoveries. These factors resulted in an increase in La Encantada's recoveries from 44% in the third quarter of 2011 to 50% in the third quarter of 2012. Efforts are continuing to optimize the recoveries at La Encantada. Management is continuing with its efforts on a number of metallurgical studies and pilot tests. The latest metallurgical test are based on roasting, which has shown promising results and a pilot plant is being designed and is expected to start operations in the first quarter of 2013. Construction and development at the Del Toro Silver Mine is well underway and currently scheduled to commence operations in December 2012. Following the successful platform construction and foundation pouring in the first half of the year, mechanical installations continued in the quarter at the crushing, flotation and thickeners areas. The construction of the 1,000 tpd flotation plant is now 90% completed. Final testing of the sewage water treatment plant was completed during the third quarter. Once the 1,000 tpd mill construction is completed, the Company is looking forward to being able to recirculate the waste water from the town of Chalchihuites back into a collection facility for treatment and reuse, not only saving the environment, but also conserving water in the region. Currently, 96% of the required equipment for the flotation circuit and 65% of the equipment for the cyanidation circuit has either arrived and is already installed on site, or is in the process of being delivered. The new 115,000 kilowatt power line from the town of Vicente Guerrero to Chalchihuites is now in the permitting process with the Mexican Federal Environmental authorities (SEMARNAT). Management is preparing an Environmental Impact Statement, and anticipates having the power line installed and operational by April 1, 2013. In the interim, portable power generators have been leased to enable initial start-up of operations. At La Guitarra, the Company had a spare ball mill on site at the La Parrilla mine, and this ball mill has been sent to La Guitarra where construction of a new foundation for this mill commenced in October 2012. In addition, a new tailings permit was received in early November 2012 for the expansion of the current tailings pond. With this permit in place and the new ball mill being installed, throughput at La Guitarra is planned to reach 500 tpd from the current 350 tpd by the end of January 2013. First Majestic is a producing silver company focused on silver production in México and is aggressively pursuing its business plan of becoming a senior silver producer through the development of its existing mineral property assets and the pursuit through acquisition of additional mineral assets which contribute to the Company achieving its aggressive corporate growth objectives. FOR FURTHER INFORMATION contact info@firstmajestic.com, visit our website at www.firstmajestic.com or call our toll free number 1.866.529.2807. FIRST MAJESTIC SILVER CORP. SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION
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| Posted: 14 Nov 2012 09:59 AM PST
THIRD QUARTER 2012 & RECENT HIGHLIGHTS
This press release should be read in conjunction with the Company's unaudited interim condensed consolidated financial statements for the third quarter ended September 30, 2012 and associated management's discussion and analysis ("MD&A") which are available from the Company's website, www.argonautgold.com, in the "Investors" section under "Financial Filings", and under the Company's profile on SEDAR at www.sedar.com.
Financial Results – Third Quarter 2012 During the third quarter of 2012, revenue was $72.9 million from gold sales of 42,534 ounces compared to $22.7 million from sales of 13,260 ounces in the third quarter of 2011. Cost of sales was $34.8 million for the quarter compared to $10.8 million for the third quarter of 2011. Cash cost per gold ounce sold was $577 compared to $628 in the same period of 2011. (Cash cost per gold ounce sold is a non-IFRS measure, see note below). During the third quarter of 2012, gross profit was $38.0 million compared to $11.9 million gross profit in the third quarter of 2011. During the quarter, profit from operations was $35.7 million compared to $10.4 million for 2011. Net income for the quarter was $26.2 million or $0.29 per basic share versus $6.0 million or $0.07 per basic share in 2011. Cash on hand increased from $21.4 million at June 30, 2012 to $42.8 million. Capital expenditures in the third quarter were $8.8 million primarily as a result of expanding operations at the El Castillo and La Colorada mines. The 2012 capital expenditures and exploration programs for Argonaut Gold includes $47-$50 million at El Castillo, La Colorada and San Antonio which includes pre-production stripping at La Colorada of approximately $3-4 million. Cash flow from operations was $36.5 million during the quarter, compared to $7.7 million for the third quarter of 2011. CEO Commentary Mr. Pete Dougherty, Argonaut's President and CEO states: "The Company saw both record gold production as well as record gold sales during the third quarter. The record sales during the third quarter provided a nice boost in earnings for our shareholders and allowed us to repay a $6 million short term debt note. The increase in production is the result of higher grade than that anticipated by the mine plan grade, commissioning of the west side pad and realizing the full benefits of the new stacking and conveying system at El Castillo." In commenting on the recent announcement regarding the acquisition of Prodigy Gold, Mr. Dougherty added: "Argonaut Gold was created with the idea of building a company that would produce between 300,000-500,000 ounces of gold annually. With the pending addition of the Magino mine in Ontario, we will have the gold resources available to achieve our vision to continue the creation of a gold mining company with a high leverage to gold resources, low capital entry point, low operational costs and a stream of projects that contain hidden value drivers. Execution of that vision will be the result of the Argonaut employees striving to obtain greater results every day, as they have previously demonstrated, since we have been in operation."
El Castillo Summary of Production Results Total tonnes mined in the third quarter 2012 were up 31 percent compared to the third quarter 2011. Of note, there was a 107% increase in crushed tonnes during the third quarter of 2012 over the third quarter of 2011. The total ounces loaded to the pad were 41,630 in the third quarter; a 39% increase over the third quarter of 2011. The strip ratio of waste to ore was 1.06 compared to a strip ratio of 0.66 in the third quarter of 2011. 2012 production guidance at El Castillo has been increased to 84,000-85,000 ounces with a cash cost between $625 and $650 per gold ounce.
La Colorada Summary of Production Results Approximately three quarters of the Phase 1 material to be reprocessed has been recrushed and restacked for leaching. Construction on pads 8, 10 & 11 has begun and approximately one-third of the pad has been completed. The crusher relocation and enhancements are scheduled for Q4 which has led to production estimates of 3-4,000 ounces of gold. Final crushing circuit expansion is scheduled for early in Q2 of 2013. Overburden removal began in the third quarter of 2012 with approximately 1.8 million tonnes moved. 2012 production guidance at La Colorada was been increased to 17,000 -18,000 ounces with a cash cost between $625 and $650 per gold ounce. Looking Forward – 2012: The Company plans on investing a total of between $48 million to $50 million on capital expenditures and exploration initiatives in 2012.
Non-IFRS Measures The Company included the non-IFRS measure "Cash cost per gold ounce sold" in this press release to supplement its financial statements which are presented in accordance with International Financial Reporting Standards ("IFRS"). Cash cost per gold ounce sold is equal to cost of sales less silver sales divided by gold ounces sold. The Company believes that this measure provides investors with an improved ability to evaluate the performance of the Company. Non-IFRS measures do not have any standardized meaning prescribed under IFRS. Therefore they may not be comparable to similar measures employed by other companies. The data is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Please see the MD&A for full disclosure on non-IFRS measures. Technical Information and Mineral Properties Reports The technical information contained in this document has been prepared under supervision of, and reviewed and approved by Mr. Thomas H. Burkhart, Argonaut's Vice President of Exploration, and a qualified person as defined by National Instrument 43-101 ("NI 43-101″). For further information on the Company's properties please see the reports as listed below on the Company's website or on www.sedar.com:
About Argonaut Gold Argonaut is a Canadian gold company engaged in exploration, mine development and production activities. Its primary assets are the production-stage El Castillo Mine in the State of Durango, Mexico, the La Colorada Mine in the State of Sonora, Mexico, the advanced exploration stage San Antonio project in the State of Baja California Sur, Mexico, and several exploration stage projects, all of which are located in Mexico.
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| Gold’s Relative Strength and What it Means Posted: 14 Nov 2012 09:46 AM PST Longtime readers of our editorials know that we are big fans of intermarket analysis as well as ardent believers in the real price of gold (real POG) or relative Gold. No this has nothing to do with the paper market versus the physical market. The real POG is essentially the POG relative to other assets and markets. There are two reasons why we track this. First, Gold priced against the other currencies (specifically the Euro) has been a leading indicator for Gold in US$ terms. Second, Gold's performance against commodities (in general) is a leading indicator for margins of the miners. We discussed this a few weeks ago. Over the weekend, I reviewed Gold's performance in relative terms and it seems to have reasserted its uptrend. In the chart below we graph Gold against six other markets (foreign currencies, equities, oil, industrial metals, and bonds). Note that Gold is in a steady uptrend against each market with the exception of bonds.
Gold priced in the inverse of the US$ basket is only 4% off its all time high while relative to oil and industrial metals, it just reached a one year high. Gold has turned down relative to bonds as they are close to testing their all-time high. Meanwhile, the yellow metal just matched a six-month high relative to the S&P 500. So why should we care about all of this? First, it tells us that Gold is in a healthy bullish position because its trending higher against all major markets with the exception of bonds. In other words, Gold is showing broad strength and is only being held back by the strength in bonds, which happens to be the largest market by a mile. Thus, when we see bonds soften, Gold should have a shot to retest its recent high. The strength in the real POG usually reflects economic contraction or deceleration. After all, if things were going well we'd expect equities and economically sensitive commodities to outperform Gold. A rise in the real POG is a negative signal for the economy and asset markets. That in itself is a catalyst for central bank action which gives liftoff to precious metals and also explains why the real POG is a trusty leading indicator. The current interpretation of the real POG bodes well for the underlying cyclical or intermediate term trend which turned bullish in May. While we are here, here are a few quick thoughts on the gold and silver shares. In the chart below we plot the two support lines for GDX, GDXJ and SIL. It appears these markets will test the lower support line.
Short term breadth indicators (courtesy of sentimentrader.com) show only 15% of gold stocks trading above their 10-day moving average and only 23% trading above their 50-day moving average. The last time both these ratios were beneath 20% was July, in which a tremendous rebound began.
To conclude, the real price of gold is trending bullish which implies good times ahead for precious metals in the coming months. The poor outlook for oil and industrial prices is a good thing for gold and silver producers as their margins could expand even further in the quarters ahead. The correction that began at the end of September is likely within days of ending. Now, with mining equities trading off their highs, is the time to do your research and find the companies that will lead the next leg higher and outperform the gold stock sector. If you'd be interested in professional guidance in uncovering the producers and explorers poised for big gains then we invite you to learn more about our service. Good Luck! Jordan Roy-Byrne, CMT
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| ECB : gold and gold receivables remain unchanged Posted: 14 Nov 2012 08:55 AM PST | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Jeffrey Tucker: Future of private money Posted: 14 Nov 2012 07:37 AM PST Subscribe to our newsletter at http://www.goldmoney.com/goldresearch. Episode 67: GoldMoney's Andy Duncan speaks to Jeffrey Tucker, Publisher & Executive Editor of Laissez Faire Books (lfb.org/) and author of It's a Jetsons World, Bourbon for Breakfast, and A Beautiful Anarchy. They discuss possible future scenarios regarding private money and trading systems, and discuss how the western world may be about to enter the trailing edge of a financial storm that started in 2008. They argue that we can survive this storm via new private and digital money technologies. Tucker points out that the global communication network is the main driving force of economic progress today. They cover BitCoin, Lending Clubs, and various forms of gold money along with the inability of governments to keep up with rapidly developing markets. They also discuss the short-term ramifications of the latest US Presidential election, as well as Jeffrey's move from the Mises Institute to Laissez Faire Books. This podcast was recorded on 12 November 2012. from goldmoneynews: ~TVR | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| China gold demand seen at record high Posted: 14 Nov 2012 07:29 AM PST China's gold demand is expected to grow 1 percent this year to a record of around 860 tonnes, the global head of metals at consultancy Thomson Reuters GFMS said on Thursday, with both jewellery and investment sales rising... Read | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| This Is A Moment In Time That’s Never Been Seen Before Posted: 14 Nov 2012 07:20 AM PST
from kingworldnews.com: Today Bill Fleckenstein told King World News, "… the world is starting to realize that this is a moment in time that's never been seen before." Fleckenstein, who is President of Fleckenstein Capital, discussed Europe, the US, gold, and the danger the world is facing today. Here is what Fleckenstein had to say: "Greece is a serial bailout, restructuring, can-kick, and I guess this is going to continue as long as the riots don't get worse. Maybe eventually Greece will get ejected from the euro. The question (in Europe) is, is Draghi going to get serious about the OMT or not?" Keep on reading @ kingworldnews.com | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Global Gold Production Is Poised To Fall Off A Cliff Posted: 14 Nov 2012 07:18 AM PST
from kingworldnews.com: Today a legend in the business surprised King World News when he warned that "… global gold production is poised to fall off a cliff." Keith Barron, who consults with major gold companies around the world and is responsible for one of the largest gold discoveries in the last quarter century, also spoke about the tragic events which are taking place in Europe. Here is what Barron had to say: "It was just announced that the creditors for Greece had gotten together and decided they are not going to impose the severe austerity they had been talking about. The European Central Bank is aware that Greece has a shortfall between now and 2016 of 32 billion euros. They have no idea where Greece is going to find it." Keep on reading @ kingworldnews.com | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Northern Tiger Resources Samples 8.5 g/t Gold over 6.8 Metres at Sprogge Project, Yukon Posted: 14 Nov 2012 06:14 AM PST November 14, 2012: Northern Tiger Resources Inc. ("Northern Tiger" or the "Company") (TSX-V: NTR) is pleased to announce that trenching on the Sprogge Project has returned assays up to 8.5 g/t gold over 6.8 metres, including 40.5 g/t gold over 1.0 metre. The Sprogge Property is adjacent to the Company's 3Ace Project in the southeast Yukon, where 2012 drilling included intercepts of 1.5 g/t gold over 45.4 metres and 3.6 g/t gold over 8.6 metres (see news release dated October 31, 2012). In addition, the Company has renegotiated its option agreement with Alexco Resource Corp. (TSX: AXR, NYSE-Amex: AXU) and Newmont Canada Corporation, a subsidiary of Newmont Mining Corporation (NYSE: NEM) (the "Vendors"). "The trenching and channel sampling program verified three structures with significant gold mineralization," says Greg Hayes, President of Northern Tiger. "The Meadow and Ridge Zone West structures in particular are now priority drill-ready targets within the larger two kilometer long trend of mineralization and extensive hydrothermal alteration outlined at Sprogge." The Sprogge Property's geology is similar to that at 3Ace, and includes a thick succession of interbedded calcareous sandstone, quartz pebble conglomerate, and phyllite. The sedimentary rocks are folded and form a large anticline in the central portion of the property. The fold system was subsequently overprinted by southwest and west-striking brittle faults which control the observed distribution of hydrothermal alteration, mineralization, and associated quartz vein systems. Trenching or channel sampling were conducted at three locations during the 2012 exploration program.Meadow Zone Trenching at the Meadow Zone exposed a 2 metre wide, steeply-dipping, southwest-striking brittle fault zone that crosscuts a thin-bedded siltstone unit. The core of the fault zone is comprised of chlorite-muscovite-scorodite altered clay fault gouge. Chip samples from across this zone yielded a composite of 8.5 g/t over 6.8 metres. A second trench, two metres to the south, was also mineralized, indicating the presence of a steeply-dipping, 13 metre wide zone of hydrothermal alteration and gold mineralization. Significant chip sample results include:
The Ridge Zone West is located 225 metres southwest of the Meadow Zone, and is comprised of arsenopyrite and clay alteration hosted by a cataclasite unit within a 15 metre wide southwest-striking brittle fault zone. Channel samples were collected from existing outcrops across the strike of the fault zone and demonstrate the presence of gold mineralization and an associated zone of intense hydrothermal alteration. Significant channel sample results include:
The Ridge Zone East is located 850 metres southeast of the Meadow Zone and is characterized by quartz tension vein arrays formed within steeply-dipping, west-striking brittle-ductile shear zones that cross-cut a thick package of quartz pebble conglomerate. Stockwork quartz veins are developed outside the narrow high-strain shear zones, within the strongly fractured wall rock. Scorodite alteration and visible arsenopyrite is distributed along fractures and within quartz veins. Significant channel sample results include:
The Sprogge Property Option Agreement has been amended to extend certain timelines for making cash payments and exploration expenditures. Under the amended terms, the Company will be required to make the following payments to the Vendors to complete the option:
Northern Tiger has the option to earn a 100% interest in the property. The Vendors retain a 2% net smelter return interest (NSR) on the property, and Northern Tiger can purchase 1% of the NSR for $1,000,000. November 14, 2012 (Northern Tiger Resources Inc) Disclosure: Northern Tiger Resources is a Vulture Bargain Candidate of Interest (VBCI) and is our fully fledged Vulture Bargain #7. Members of the GGR team are actively accumulating and hold long positions in NTR.V or NTGSF. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Bart Chilton On Silver Manipulation - Gold and Silver Coiling For a Major Move - The Next Disaster Posted: 14 Nov 2012 06:10 AM PST Jesse's cafe | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| $1803 Is Where Gold Would Come Alive Posted: 14 Nov 2012 05:35 AM PST Rick Ackerman | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Posted: 14 Nov 2012 05:22 AM PST Bring it on, Barry! "4 more years! 4 more years! 4 more years!..."  http://www.caseyresearch.com/gsd/edi...t-manipulation | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Pay Me In Gold: Lawmaker Requests Compensation In “Money That Has Intrinsic Value” Posted: 14 Nov 2012 04:00 AM PST | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ‘King Dollar’ hard to dethrone Posted: 14 Nov 2012 03:45 AM PST Gold and silver keep bumping up against resistance in the face of renewed uncertainty in the markets. Talk yesterday of open disagreement between eurozone politicians and the IMF on the thorny subject ... | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Posted: 14 Nov 2012 03:09 AM PST ¤ Yesterday in Gold and SilverThe gold price didn't do much until the Comex open on Tuesday morning in New York...and then rallied until 9:00 a.m. Eastern...before getting sold off until precisely 9:30 a.m. Then a rally began that got halted in its tracks at precisely 11:00 a.m. Eastern time...4:00 p.m. GMT...which was the London close. Note the sell-off at the London close on Monday as well. Nothing free market about any of this. The New York low was $1,717.00 spot...and the high tick at the London close was $1,734.50 spot...a one percentage point price swing. Gold closed at $1,724.90 spot...down $3.90 on the day. Net volume was pretty light...around 116,000 contracts, but much higher than the 70, 000 contract day we had on Monday.
Here's the New York Spot Gold [Bid] chart so you can see the precision of JPMorgan et al when they're in action.
As you already know, the silver price action was more 'volatile'...and that's being polite about it. A rally began shortly after the London open at 8:00 a.m. GMT...and that topped out around the 12 o'clock noon GMT silver fix. After that, the silver price had pretty much the same price path as gold...although the percentage price swings were much bigger. The New York low in silver was $32.04 spot...and the high tick was $32.95 spot. The London low...and Far East low...also checked in around the $32.05 spot price, so the intraday price move in silver was about 90 cents...almost 3 percent. Silver closed the Tuesday trading session at $32.50 spot...up the magnificent sum of 8 cents the ounce. Net volume was around 36,000 contracts...about 50 percent higher than Monday's volume.
Like Monday, it should be obvious to any casual observer that both gold and silver would have finished materially higher in price if a not-for-profit seller hadn't shown up a couple of times during the Comex trading session...especially at the London close. It was a different story with the other two precious metals of note. Platinum closed up 1.02%...and palladium was the star...up 4.28%. It's obvious that there weren't too many not-for-profit sellers around in these white metals.
The dollar index traded in a fairly wide range just above the 81.00 level for the entire Tuesday trading session...and closed virtually unchanged at 81.11. Nothing to see here, folks...please move along.
The gold stocks struggled mightily...but couldn't break above unchanged...and around 12:30 p.m. Eastern time, they rolled over...and that was it for the day. The HUI closed down 1.16%.
There was the odd green arrow amongst the silver stocks I follow, but for the most part, they pretty much all finished in the red...but not as badly as the gold stocks. Nick Laird's Silver Sentiment Index closed down only 0.21%.
(Click on image to enlarge) The CME Daily Delivery Report was another yawner, as only 1 gold and 5 silver contracts were posted for delivery from the Comex-approved depositories on Thursday. There was no reported change in GLD...but for the second day in a row an authorized participant withdrew silver from SLV. This time it was 822,901 troy ounces. Bron Suchecki over at The Perth Mint sent me an e-mail regarding the quick deposits of silver into Sprott's Physical Silver Trust...PSLV...that I mentioned in this space yesterday. This is what he had to say... "Hi Ed, I noted your comment in today's piece that the Sprott deliveries were fast. FYI, the reported figures reflect when Sprott bought the metal and not when it was delivered. The U.S. Mint had a pretty decent sales report yesterday. They sold 4,500 ounces of gold eagles...1,000 one-ounce 24K gold buffaloes...and a rather chunky 647,000 silver eagles. It was a busy day at the Comex-approved depositories on Monday. They received 1,177,273 troy ounces of silver...and shipped only 30,924 troy ounces of the stuff out the door. The link to that activity is here. I have a couple of charts for you today. The first is courtesy of Washington state reader S.A...and it's self-explanatory. Silver rocks!
(Click on image to enlarge) The other is from Nick Laird and, based on his calculations, the graph is titled "Annual Chinese Gold Accumulation Since 2000"...and as Nick said in his covering e-mail..."At the current rate, China will exceed U.S. gold holdings within 4 years." One of Nick's presumptions when putting this graph together was "that all imports into China came in through Hong Kong." Some day we'll know for sure...maybe.
(Click on image to enlarge) I have a lot of stories again today...the first one of which is of the tabloid variety. I'm also curious to know how warm it's getting over at Canada's Scotiabank/Scotia Mocatta... Butler sees silver's price appreciation potential far greater than gold's. Silver price to 'increase 400pc in three years'. Banking system gold may not be real or accessible: NY Times. Gold Industry Facing Mine Discovery Challenge, Barrick Says. ¤ Critical ReadsSubscribeDavid Petraeus ordered lover Paula Broadwell to stop e-mailing Jill KelleyPaula Broadwell, the former CIA director's biographer and lover, allegedly sent threatening messages to Jill Kelley, a 37-year-old "social liaison" for the US military in Tampa, triggering the FBI investigation which led to Gen Petraeus's downfall. When Mrs. Kelley, a family friend of the Petraeuses, learned from the FBI that the anonymous messages were coming from Mrs. Broadwell she turned to the former general for help. Gen Petraeus then urged Mrs. Broadwell to stop, according to the Washington Post. Mrs. Kelley reportedly went to the FBI in early summer after she began receiving the emails. The relationship between the general and his biographer is believed to have ended in July. On Sunday Mrs. Kelley, who insists that the former CIA director is just a close friend who is like a grandfather to her children, was identified as the woman Mrs. Broadwell believed was her rival. Mrs. Kelley was silent yesterday after hiring Monica Lewinsky's former crisis manager. As I said in this space yesterday..."you couldn't make this stuff up in a third-rate spy novel." This piece is from The Telegraph on Monday evening GMT...and I borrowed it from yesterday's edition of the King Report. The link is here. [Where's Allan Fotheringham when you need him the most? - Ed]  Petraeus Case Shows Your E-mails Aren't Safe From FBIYour e-mails are not nearly as private as you think. The downfall of CIA Director David Petraeus demonstrates how easy it is for federal law enforcement agents to examine emails and computer records if they believe a crime was committed. With subpoenas and warrants, the FBI and other investigating agencies routinely gain access to electronic in-boxes and information about e-mail accounts offered by Google and other Internet providers. "The government can't just wander through your e-mails just because they'd like to know what you're thinking or doing," said Stewart Baker, a former assistant secretary at the Department of Homeland Security and now in private law practice. "But if the government is investigating a crime, it has a lot of authority to review people's e-mails." This story was posted on the CNBC website during the New York lunch hour yesterday...and I thank West Virginia reader Elliot Simon for bringing it to our attention. The link is here.  Google Says Governments Requesting More Content RemovalsGoogle Inc. said government requests to remove content from its search results and other services rose 71 percent in the first half of the year, according to a new report. The owner of the world's largest search engine said there were 1,791 requests in the six months through June, up from 1,048 during the last six months of 2011, according to its Transparency Report. Turkey's government made 501 requests to remove content, up from 45 in the previous period, while the U.S. followed with 273, up from 187. Google is under scrutiny from companies and governments around the world over what type of content it shows. Some countries are being more aggressive in seeking content removal from search results and sites such as video-sharing service YouTube. While the company may receive such requests, Google may choose not to comply, according to the report. This Bloomberg story was posted on their website at 12:50 p.m. Mountain Standard Time yesterday...and it's the second item in a row from Elliot Simon. The link is here.  Rivals dig in as "fiscal cliff" drama debutsBoth sides in the "fiscal cliff" debate stood their ground on Tuesday as they gathered in Washington for the first time since the elections, with a fundamental tax dispute preventing a broader compromise on deficit reduction. The White House made clear it was ready to negotiate with Republicans on taxes and spending, but a spokesman for Democratic President Barack Obama said he will not budge on insisting that the wealthy's tax rates must rise in 2013. The president wants to extend low individual income tax rates beyond year's end for 98 percent of Americans, but he will not agree to extending them for the top 2 percent of earners, said White House spokesman Jay Carney at a news conference. On the Senate floor, Republican Leader Mitch McConnell said his party was open to discussing new government revenues, but not raising tax rates. "We're ... not about to further weaken the economy by raising tax rates and hurting jobs," he said. This Reuters story was filed from Washington shortly after the markets closed yesterday afternoon in New York...and I thank Roy Stephens for his first offering of the day. The link is here.  Why Texas Could Probably SecedeAs of this writing, the Texas petition to peacefully "withdraw" from the United States via the White House's open petition webpage is up to 62,481 signatures, on its way to tripling the required names needed to trigger a response from the Obama administration. No doubt Texas' desire to break free is a source of amusement inside a White House that has mastered the art of belittling the opinions of its challengers, but there is one not-so-small problem here: Texas could pull it off. This short story was posted on the businessinsider.com Internet site yesterday afternoon...and I thank Roy Stephens for sending it...and the link is here.  White House may respond to Texas secession petitionLooks like the Obama administration may have to respond to a petition seeking the green light for Texas to secede from the United States—one of 20 such requests filed on the official White House website since Election Day. At the time of the writing of this post, the Texas secession petition had garnered 25,318 signatures—above the White House's self-imposed rules for requiring a reply. Other secession petitions include requests for Arkansas, South Carolina, Georgia, Missouri, Tennessee, Michigan, Colorado, Oregon, New Jersey, North Dakota, Montana, Indiana, Mississippi, Kentucky, North Carolina, Alabama and New York. This news.yahoo.com story from Monday was sent to me by Alberta reader Jerome Cherry...and the link is here.  Marc Faber: Prepare for a Massive Market MeltdownThe markets are going to go into meltdown soon, so expect stocks to lose 20 percent of their value, Marc Faber, author of the Gloom, Boom and Doom Report told CNBC on Tuesday. "I don't think markets are going down because of Greece, I don't think markets are going down because of the 'fiscal cliff' — because there won't be a 'fiscal cliff,' " Faber told CNBC's "Squawk Box." "The market is going down because corporate profits will begin to disappoint, the global economy will hardly grow next year or even contract, and that is the reason why stocks, from the highs of September of 1,470 on the S&P, will drop at least 20 percent, in my view." Faber, who is known for his bearish views, cited tech giant Apple, a company whose disappointing earnings have caused its stock to fall 20 percent from its September highs and 14 percent in the past month. This story was posted on the cnbc.com Internet site early yesterday morning...and I thank Scott Pluschau for bringing it to our attention. The link is here.  | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The Telegraph: Silver price to 'increase 400pc in three years' Posted: 14 Nov 2012 03:09 AM PST  Silver will increase in value five times over the next three years, according to mixed asset fund manager Ian Williams. "Silver is about to enter a sustained bull market that will take the price from the current level of $32 an ounce to $165 an ounce and we expect this price to be hit at the end of October 2015," he predicted. "This forecast is based entirely using technical & cyclical analysis and is in keeping with the mathematical form displayed so far in the bull run that has taken Silver from $8 an ounce in 2008 to its current price of $32 an ounce – having hit $50 an ounce in 2011." | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Global silver market surplus to edge up to 300m ounces in 2012 – GFMS Posted: 14 Nov 2012 03:09 AM PST  The surplus in the global silver market is expected to edge up to 300 million ounces in 2012 from a year earlier, the global head of metals analytics at GFMS, a Thomson Reuters unit, said on Wednesday. Philip Klapwijk, speaking on the sidelines of a conference in Hong Kong, also said demand for silver fabrication had weakened, although some of the decline had been offset by higher silver output in China. "The situation this year is that we see weaker fabrication demand on two main reasons. One is industrial fabrication has slowed quite considerably this year, especially in recent months, and we see weakness especially in the electronics field and photovoltaic end users," said Klapwijk. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Gold & the Dollar are Less Correlated than Everyone Thinks Posted: 14 Nov 2012 01:12 AM PST Whenever I make the case for a stronger U.S. dollar (USD), the feedback can be sorted into three basic reasons why the dollar will continue declining in value:... Read | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The CBO’s Latest Con Job: Disappearing Data to Deter Analysis of its Deficit Scaremongering Posted: 13 Nov 2012 11:03 PM PST This is Naked Capitalism fundraising week. 467 donors have already invested in our efforts to shed light on the dark and seamy corners of finance. Join us and participate via our Tip Jar or WePay in the right column or read about why we're doing this fundraiser and other ways to donate, such as by check, on our kickoff post or one discussing our current target. The CBO is resorting to such extreme measures to impede independent analysis of its scaremongering about the fiscal deficits that it's hard not to conclude that it has something to hide. Here's one simple and egregious example. If you look at the CBO forecasts, they show the US getting to a 89.7% federal debt to GDP ratio by 2022 if no changes in policy occur. For economists and financial markets types, as well as the policymakers they lead by the nose, that 90% number is treated as a seriously bad outcome for very dubious reasons. It has the same stature as edge of the earth in maps from the days when people thought the world was flat, that if you go over it, all sorts of terrible things happen. That number comes from the work of Carmen Reinhart and Kenneth Rogoff in which they found that countries that had 90% debt to GDP ratio had lower growth levels. The wee problem is that using that correlation as a guide is bunk. First, it mingles gold standard countries (which do have to do through all sorts of insane growth-damaging contortions to run sustained deficits)n with fiat currency issuers. Second, in the overwhelming majority of cases, the increase in debt to over 90% and low growth were the result of a large financial crisis. Thus there is no evidence that dorking with the debt levels would ameliorate the post crisis sluggish growth; the evidence from Europe (and the IMF has 'fessed up to this) is that trying to cut deficits in the wake of a crisis produces an economic contraction, making debt to GDP ratios worse than they were before. Third, there are some striking exceptions to what among the policy classes is being treated as an inviolate rule, most importantly, Great Britain in its greatest growth period, from 1735 to 1875, had a debt to GDP ratio of over 100%. But since everyone takes this phony danger level as real, let's indulge it for a minute. Despite the CBO's blatant deficit hawkery, if you run the data correctly, you don't reach that scary level. The CBO has done the equivalent of cooking the data to produce its desired outcome. It omits financial assets held by the government from its calculation. Now here is how you can see the CBO is not acting as a neutral analyst, as it is tasked to by statue, but a policy advocate. As we've pointed out, Thomas Ferguson and Robert Johnson took the CBO's forecasts as of August 2010 and demonstrated that if you included the federal government's financial assets, which it had shown as just under 8% of GDP, even in its worst case "low growth" scenario, debt to GDP stayed under 82% by 2020. Having been alerted to the Ferguson/Johnson paper, "A World Upside Down: Deficit Fantasies in the Great Recession," International Journal of Political Economy, Vol. 40 No. 2 (2011), has the CBO decided to deal honestly with the question? No. Like the mob faced with the prospect of a damaging witness testifying, it has done a hit job on the data. Its recent deficit discussions do not even reference this information. As Thomas Ferguson complained, "Talk about 'Choices for Deficit Reduction.' I finally found the numbers in an OMB report issued earlier this year. The CBO should be printing these right along with the gross debt; at least back in 2010, you could find them in the fine print of one or two CBO reports. Now not even a magnifying glass will help."
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| Put 10% of your assets in gold and pray it doesnt work. Posted: 13 Nov 2012 10:30 PM PST | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Turkish prime minister says gold should replace dollar Posted: 13 Nov 2012 10:00 PM PST Chris Powell | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Australian LNG Projects Get Pricey Posted: 13 Nov 2012 09:25 PM PST 'Boom crash opera!' In keeping with this week's musical theme, that's how we'd describe yesterday's drama in the Australian share market. The ASX/200 fell over one and a half per cent by the close. It was an equal opportunity blood-letting, with the banks and the miners being hit. But we'll handball the analysis of the Aussie market to our resident technician, Slipstream Trader Murray Dawes. Murray writes a regular Wednesday column over at Money Morning. We thought you might find his latest analysis useful. You can find his stock market analysis here. In the meantime, when is the Australian dollar going to stop its brutal acts of vandalism on the Australian economy? Cost blowouts on Australian Liquefied Natural Gas (LNG) projects now exceed $35 billion since May of last year, according to today's Australian Financial Review. This comes hot on the heels of Chevron staring down the barrel of $20 billion in extra costs at its Gorgon LNG project in Western Australia and ExxonMobil raising its estimated costs and its PNG LNG project by US$3.3 billion. Australia isn't just an expensive place to have breakfast and a beer (or a breakfast beer). It's an expensive place to do business. Just because you have the gas, gold, or ore in the ground doesn't mean companies will queue up to extract it any price. The conclusion is obvious: the Aussie dollar must be stopped! Source: StockCharts The strong Australian dollar is the bane of resource companies that were counting on lower dollar costs for their billions in investment. That pipeline of capital investment — there are seven different LNG projects in Australia and PNG worth $175 billion being developed — is what the Reserve Bank and the Treasury are counting on to power economic growth. If the high Aussie dollar makes Aussie LNG projects globally uncompetitive, it's a body blow for the whole economy. But what can you do? Knee-cap the dollar in a back alley when no one's looking? The RBA doesn't want to actively intervene with interest rates to weaken the dollar. The strong dollar makes it easier for Australian banks to borrow money globally. And they still need to borrow. A lot. NAB's Cameron Clyne says that Aussie banks' 'heavy use of wholesale funding markets still posed a key economic risk.' He added that Aussie banks were 'not set up optimally' to meet the country's hundreds of billions in infrastructure financing needs. In other words, even though the strong dollar threatens to make wide swaths of the resource industry uncompetitive, the banking industry (the whole economy really) is so reliant on outside money that the RBA can't afford to lower rates and make Australia a less attractive place for global capital. So the strong dollar has become the resource market's burden. About the only relief for the big LNG developers is that you're seeing the development of a global LNG market with more than just regional pricing. The International Energy Agency reports that 80% of natural gas growth coming from countries not in the OECD, Australia may get a reprieve from its cost blow outs in the form of higher natural gas prices.
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