Gold World News Flash |
- Golds Big Fuss Over Nothing
- Andy Hoffman – Fiscal Cliff & Gold Cartel Updates
- Gold Forecast 2013: Accelerating Long-Term Trend
- What Japan Is Going To Do To Light The Gold Market On Fire
- Swaps, Banks, and Litigation Arbitrage
- Gold And The Potential Dollar Endgame Part 2: Paper Gold — What Is It Good For?
- The Coin Analyst: Overview of House Hearing on The Future of Money: Dollars and Sense
- By the Numbers for the Week Ending November 30
- Gold And The Potential Dollar Endgame Part 2: Paper Gold, What Is It Good For?
- $11.5 million gold heist from Curacao boat, seventy bars of gold taken
- Free-Market Thinking Advances in Britain
- The Silver and Gold Price Have Begun Their Next Leg Up I'm Still Buying Silver and Gold
- China Silver Demand — One Step Closer to the Edge
- U.S. gold coins set for strongest November sales in 14 years
- Silver price edging towards key resistance level
- Guest Post: Let's Have A Depression Now
- Harvey Organ – The Emerging Gold Shortage
- Silver and the Risk Trade
- Global Silver Mining Stocks Production
- Gold Possibility to Regain Its Medium-term Glitter
- Pressure mounts on Turkey to end Iran Gold deal
- Gundlach: "I'm Waiting For Something To Go Kaboom"
- Global Silver Mine Production
- Gold, Silver Rise On QE4 Currency Debasement Concerns
- Gold Price Forecast to Average $1920 in 2013
- SLA all the way! Mick's stacking silver, are you!?
- SLA all the way! Mick’s stacking silver, are you!?
- The Most Ridiculous Close To An Unimpressive Week
- Gold and Silver Disaggregated COT Report (DCOT) for November 30
- Gold primed to gain if budget talks fail: analyst
| Posted: 01 Dec 2012 12:26 AM PST Bullion Vault
|
| Andy Hoffman – Fiscal Cliff & Gold Cartel Updates Posted: 30 Nov 2012 11:40 PM PST from visionvictory
|
| Gold Forecast 2013: Accelerating Long-Term Trend Posted: 30 Nov 2012 11:00 PM PST Dima Kash, Euro Pacific Precious Metals:
An accelerating trend has resulted in a gold market which has made new highs every year since 2001, while doubling in price every 4 years. The following table displays maximum yearly prices for the yellow metal. In 2012, the question remains whether we will we see this pattern of higher highs continue. So far the high for this year has been $1,798.1/oz, or 7% below the 2011 high. With a little over a month remaining before the end of this year, there is definitely a chance that we could see a strong year-end rally. If we do not break above $1,923.7/oz by the end of this year, we would expect the breakout to occur on or before Q1 2013. Read More @ Euro Pacific Precious Metals
|
| What Japan Is Going To Do To Light The Gold Market On Fire Posted: 30 Nov 2012 10:00 PM PST from KingWorldNews:
He then said this would cause the yen to fall to 100 yen to the dollar, from its current value of 82. This in turn would raise the CPI inflation rate to Abe's target zone of 2% to 3%. So this was more talk about what Abe would do should he become Prime Minister following the election in Japan on December 16th. Now if the yen falls back to 100, we believe that would be very positive for the Japanese equity market…" Caesar Bryan continues @ KingWorldNews.com
|
| Swaps, Banks, and Litigation Arbitrage Posted: 30 Nov 2012 09:59 PM PST The Bernank is beginning to wind down his "non-bailout" of Europe. On 12/14/2011 the Chairsatan himself reportedly told Senator Corker that he had no intentions of furthering the US's involvement in the European Crisis. Coincidently a few weeks later CNBC interviewed Gerald O'Driscoll, who is a previous Dallas Fed Vice President, after he released an Op-ed in the WSJ calling out the FED's European bailout. O'Driscoll is dead on with his claims about Bernanke bailing out Europe and his suspicions about Bernanke's reasoning behind going through the FED market arm to lend USD to the ECB.
One thing O'Driscoll touches upon is Bernanke's "legal" reasoning. I covered this previously and will readdress it here because its critical to understand. Months ago Zerohedge identified three key terms that would be discussed among "fringe financial blogs":
Bernanke's "legal" reasons lie within the legal pages of sovereign nation courts and what Zerohedge pointed out before everyone else, the critically important "litigation arbitrage". Within this phrase are disputes between nations about the standing of the relationship of their governments and the nation's central bank also stated as whether a central bank is its own private entity or an "alter ego" of its sovereign nation (I've already covered this in detail here). That's where profit on this level is made. If a central bank interacts with the FRBNY FX Liquidity Swap Operations and it is for activities deemed to be public actions, not private profit actions, then the central bank is immune from default laws in the United States. Consider a previous FRBNY legal case involving two hedge funds and the Argentine central bank. An IMF paper (embedded below the post) identifies "litagation arbitrage":
And that's just the tip of the primary reason why this facility is so important. According to the FRBNY:
|
| Gold And The Potential Dollar Endgame Part 2: Paper Gold — What Is It Good For? Posted: 30 Nov 2012 09:52 PM PST by Joe Yasinski and Dan Flynn, Bullion International:
When we talk about "paper" markets, we are broadly referring to derivative markets; forwards, swaps, and in the case of gold, unallocated gold accounts as well. Derivative markets for commodities were developed to smooth the wild price swings caused by supply gluts or unexpected shortages. Read More @ BullionInternational.com.com
|
| The Coin Analyst: Overview of House Hearing on The Future of Money: Dollars and Sense Posted: 30 Nov 2012 08:00 PM PST [Ed. Note: Wow, this should save our government 4.4 Billion Dollars over the next THIRTY Years! Ron Paul's ideas for reform were just a a bit more extensive...] by Louis Golino, CoinWeek.com:
The main highlights of the hearing were as follows. The U.S. Mint reported that circulating coin production increased substantially over the past year, while numismatic and bullion coin sales decline sharply. The Government Accountability Office reiterated its conclusions from February of this year that replacing dollar notes with coins would save $4.4 billion over 30 years.
|
| By the Numbers for the Week Ending November 30 Posted: 30 Nov 2012 07:50 PM PST This week's closing table is just below. 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, will likely be completed by the usual time on Sunday (by 18:00 ET). Early Monday at the latest.
|
| Gold And The Potential Dollar Endgame Part 2: Paper Gold, What Is It Good For? Posted: 30 Nov 2012 06:38 PM PST Authored by Dan Flynn and Joe Yasinski of Gold Bullion International, Part 2 of 3: "Paper Gold, what is it really good for?" In our first installment of this series we explored the concept of stock to flow in the gold markets being the key driver of supply/demand dynamics, and ultimately its price. To briefly summarize the STF concept, the "stock" of existing gold is the total amount ever mined and the "flow" is the amount of physical gold available for purchase on any given day. Obviously the more flow, the more for sale and presumably, the lower the price. Today we are going to explore the paper markets and, importantly, to what degree they distort upwardly the "flow" of the physical gold market. We believe the very existence of paper gold creates the illusion of physical gold flow that does not and physically cannot exist. After all, if flow determines price – and if paper flow simulates physical metal movement to a degree much larger than is possible – doesn't it then suggest that paper flow creates an artificially low price? If the physical metal does not actually flow along with paper representations of flow, then isn't it true that the current stock to flow ratio may already be much higher than previously imagined? When we talk about "paper" markets, we are broadly referring to derivative markets; forwards, swaps, and in the case of gold, unallocated gold accounts as well. Derivative markets for commodities were developed to smooth the wild price swings caused by supply gluts or unexpected shortages. The first modern exchange for rice dates back early 18th century Japan. By 1848, the Chicago Board of Trade was formed, originally clearing trade of forward contracts on corn. Consumed commodities tend to exhibit tight supply/demand dynamics so it is easy to understand the necessity for such 'paper' markets for legitimate hedging purposes. As discussed in part one, gold is not consumed and given the existing stock and annual mine production – there is an approximate 65 year 'overhang' of new mining supply. Can you imagine the need of Cargill to hedge the cost of corn if a non-perishable, 6 decade supply sat in their warehouse? With a relatively massive existing stock of gold, there is no potential supply shock to hedge against – and the need for a large derivative gold market seems completely illogical. It follows that as the derivative market for most commodities developed over the last 3 centuries, the gold market remained "physical only". Whether for settlement of international trade or otherwise, there was no need for 'paper gold' as the marketplace for and the flow of physical gold bullion was robust. Things began to change in the 1970's following the US default on the Bretton Woods agreement as the $ Dollar detached from its' golden anchor. The $USD price of gold rose over the decade from $35/oz. to $200, then $300, then $400, reflecting the uncertain value of the newly fiat currency. As gold's price rose, its' flow slowed dramatically, putting further upward pressure on the price, ultimately pushing it above $800/oz. Seeing higher gold prices, many new mines came on-line chasing the higher prices. The new mines needed cash capital to get up and running, and the bullion banks offered loans. The US futures market for gold opened in January 1975, and by the late 1970's, a gold company could take a loan, denominated in ounces of gold, at a much lower rate than they could take a traditional cash loan. Originally referred to as "mine finance" (Guy, 2012), bullion banks could offer lower rates of interest on loans tied to physical gold as they didn't have to compensate for the rapid loss of purchasing power in fiat-currency denominated loans. By 1987, the London Bullion Market Association was incorporated. This collection of dealers and banks developed guidelines for clearing arrangements, options, and the development of the Gold Forward Option Rate (GOFO) – furthering the development of bullion banking. "Paper Gold" was born. In typical Wall Street fashion, below-market interest rate gold loans began to attract the attention of hedge funds and other large pools of capital interested in using leverage to take advantage of the spread between various "risk-free" rates. Bullion banks were able to offer attractive terms to private holders of gold in return for gold deposits. This in turn allowed for more gold-denominated lending, even to borrowers who were not producers of gold. Great idea! What could possibly go wrong? Most gold trading – both physical and paper - clears through the London market, with dealers and banks settling transactions for clients around the world. According to the LBMA website, "a credit balance on a loco London account with an LBMA member represents a holding of gold or silver the same way that a credit balance in the relevant currency represents a holding on account with a New York bank or Tokyo bank." Further, the LBMA explains "Credit balances on the account do not entitle the creditor to specific bars of gold or silver, but are backed by the general stock of the bullion dealer with whom the account is held. The client is an unsecured creditor." (London Bullion Market Association, 2012) Let us pause here to re-emphasize a point. When you deposit money at a New York or Tokyo bank, you no longer own the money. You own a claim – you own bank credit. Banks are free to use deposits as they please – typically as a base to leverage – aka fractional reserve banking. As the LBMA points out, loco London accounts operate in the same way – they are bank credit denominated in gold. So long as the bank meets its' contractual obligation, paper gold and allocated physical are fungible. Over the decades, the derivative market for gold has grown exponentially. What began as a means to finance new gold production has morphed into an untenably leveraged marketplace. As US Dollar denominated obligations have skyrocketed, so has the demand for hedges against the US Dollar. Gold is the ultimate fiat currency hedge. As discussed in part 1, gold is a Giffen good. Unlike other commodities, physical gold becomes scarcer as its price rises. As long as the marketplace holds "paper" gold on par with physical gold, the dollar price of gold is suppressed because of the new, synthetic paper flow. In order to maintain confidence in the $USD as a store of value – flow of gold bidding for dollars is desperately needed. As we see it, the US Dollars' ability to function as a store of value, and global reserve currency, is now completely dependent on the continued flow of (and confidence in) 'paper' gold. How big is the flow of this combined market? Total trading volume for 2011 was estimated at 50,459,865,000 ounces. (Gold Fields Mineral Services, 2012) 50 BILLION OUNCES!! As a point of reference, the World Gold Council states that annual mine production for the last 5 years has averaged approximately 83,000,000 ounces, and total above ground stock of physical in all forms is approximately 5,465,500,000 ounces. (World Gold Council, 2012) One might conclude that a significant amount of leverage exists in the gold markets given the fact that in 2011, the volume of paper gold that traded equaled 10x the amount of physical gold that has been mined in history! Consider further that the WGC estimates that only 19% of existing above ground stocks is categorized as "investment", and nowhere near all of that 19% sits in LBMA vaults in good delivery form, ready to satisfy paper claims. Further, Central Banks (estimated to hold approximately 20% of the gold stock) today are net buyers – not sellers.
At its April 2011 meeting, the LBMA Management committee agreed to survey its 56 full members for trading turnover in the loco London gold market. The World Gold Council, who has been advocating for the inclusion of gold as a high-quality liquid asset under Basel III, wanted the LBMA to help demonstrate the depth and liquidity of the gold market. (Murray, 2011) Typically, only monthly clearing statistics are available from the 6 clearing members that form the LPMC (Barclays, Deutsche Bank, HSBC, JP Morgan, UBS, and ScotiaMocatta). These clearing statistics include transactions executed within their own books and between each other. The last liquidity survey was carried out and published in 1996 and was restricted to the LBMA's market makers. By August 2011, 36 of the 56 Full LBMA trading members submitted returns for the new survey, and the results were rather shocking. Quietly, the size of the "paper" gold market had grown to monstrous proportions – successfully creating a tsunami of paper gold flow. In fact, according to the Q1 2011 LBMA Liquidity survey, over 173,713,000 ounces or 5,400 tons of "paper gold" per day (more than 2 year annual physical production) turns over with only 2/3 of LBMA members reporting! The surveyed turnover of the 56 LBMA trading members demonstrates total loco London volumes (perhaps not surprisingly) ten times the size of the 6 LPMC members. Without question, the gold market "flow" is dominated by the paper market. Yes, good old fashioned physical bullion does trade hands OTC – and at GBI we facilitate physical transactions every day. But the great majority of physical lies very still while paper changes hands rapidly. We have a better idea now how much paper gold is flowing, but it's crucial to understand the leverage that paper flow represents. How many paper claims exist on the relatively small stock of bullion? For a few hints, we can look to the COMEX. As of October 30, 2012 COMEX gold Open Interest equaled 454,742 contracts (45,474,200 ounces of gold). COMEX registered inventory stood at 2,735,041 ounces for a factor of 16.6X. (CME Group, 2012) Is a leverage factor of 16 enough for you to take action? For some very prominent fiduciaries, the answer is a resounding "YES". In a 2011 interview Kyle Bass of Hayman Capital (who helped the University of Texas Endowment take delivery of nearly $1 Billion in physical gold bullion) described a conversation he had with an exchange official:
Let's look at the leverage a different way. In 1Q11, the 36 reporting members of the LBMA disclosed gold sales of 5,593,743,000 ounces versus purchases of 5,350,183,000 ounces (see line 1 – London Turnover). Based on the survey, we deduce that in 1Q11 excess demand for gold was 243,560,000 ounces which translates into approximately 7,575 metric tons. In a typical year, quarterly physical production (new mining supply) is approximately 625 tons. One would imagine that with a traditional commodity, physical demand outstripping new supply in a given quarter by a factor of 10 would cause a significant increase in price!! And for commodities like copper, corn, or cotton that would certainly be true. Yet during 1Q11, the price of gold rose from $1410 to $1439…a $29 dollar per ounce increase. (LBMA, 2011)
If one is viewing gold as a currency, this data is to be interpreted differently. A large player using paper gold to hedge $USD exposure doesn't necessarily think of gold in terms of ounces, but instead looks at these contracts in terms of dollars. (FOFOA, 2011) For the currency trader or $USD hedger, the more relevant data point is quarterly demand of $337 Billion (Line 1, total value of sales net of purchases). We believe that the largest holders of physical gold have very strong hands – and $1,400 per ounce is nowhere near high enough a price to coax significant new flow into the market. As a simple mind exercise, let's imagine this dollar denominated gold demand was met exclusively from new mine production – no paper flow and no existing physical bidding for dollars. Based on the LBMA liquidity survey and WGC data, newly mined (average) per quarter flow of 625 tons physical gold would have needed to absorb 100% of that $337 Billion dollar demand. And in order to do so – gold could not have been at $1,400/oz. Instead, to clear the market gold would have averaged a price of $16,920! This is a partial glimpse at the true Freegold concept (Another, 1997) – no paper gold flow – a return to a purely physical marketplace. Although this may sound like an amazing price - if we apply a "reserve" factor of 16.6 to the LBMA demand statistics, we'd suggest that $16,000 gold would be a bargain. It's all a matter of perspective. Leveraged systems are based on confidence – confidence in efficient exchanges, confidence in reputable counterparties, and confidence in the rule of law. As we have learned (or should have learned) with the failures of Long Term Capital Management, Lehman Brothers, AIG, Fannie & Freddie, and MF Global – the unwind from a highly leveraged system can be sudden and chaotic. These systems function…until they don't. CDOs were AAA… until they weren't. Auction Rate Securities were great 'cash management' vehicles…until they weren't. "Principal Protected" Convertible Notes underwritten by Lehman Bros were like CDs…until they weren't. Paper Gold is just like allocated, unambiguously owned physical bullion…until it's not. At GBI, we believe THE WAY to hold gold is via unambiguous ownership, allocated and held outside of the banking system. Any other way introduces unnecessary and potentially catastrophic counterparty risk. We've built our company to give clients the same or better liquidity and trading convenience as the 'paper gold' alternatives – but with the safety and security of insured storage, geographic diversification and clear title that whole bar and/or coin ownership brings. In the final part of this series we will discuss what we see as signs of major stress in the paper gold market and what the end-game might look like for holders of paper contracts as well as owners of physical bullion.
|
| $11.5 million gold heist from Curacao boat, seventy bars of gold taken Posted: 30 Nov 2012 06:34 PM PST Stacy Summary: Looks like the NY Fed is out rustling up some of that 50 tons of gold they need to deliver to Germany! $11.5 million gold heist from Curacao boat Masked men in jackets emblazoned with the word "police" … Continue reading
|
| Free-Market Thinking Advances in Britain Posted: 30 Nov 2012 06:20 PM PST from The Daily Bell:
Dominant Social Theme: We just won't talk about this one, boys. Free-Market Analysis: Despite the naysayers, free-market thinking continues to advance. In the US conservative libertarian congressman Ron Paul literally had the nomination removed from his grasp by GOP dirty tricks. And now in Britain, we see UKIP making great strides.
|
| The Silver and Gold Price Have Begun Their Next Leg Up I'm Still Buying Silver and Gold Posted: 30 Nov 2012 05:23 PM PST Gold Price Close Today : 1,710.90 Gold Price Close 23-Nov : 1,751.40 Change : -40.50 or -2.3% Silver Price Close Today : 3320.4 Silver Price Close 23-Nov : 3411.6 Change : -91.20 or -2.7% Gold Silver Ratio Today : 51.527 Gold Silver Ratio 23-Nov : 51.337 Change : 0.19 or 0.4% Silver Gold Ratio : 0.01941 Silver Gold Ratio 23-Nov : 0.01948 Change : -0.00007 or -0.4% Dow in Gold Dollars : $ 157.38 Dow in Gold Dollars 23-Nov : $ 153.55 Change : $ 3.83 or 2.5% Dow in Gold Ounces : 7.613 Dow in Gold Ounces 23-Nov : 7.428 Change : 0.19 or 2.5% Dow in Silver Ounces : 392.29 Dow in Silver Ounces 23-Nov : 381.34 Change : 10.95 or 2.9% Dow Industrial : 13,025.58 Dow Industrial 23-Nov : 13,009.68 Change : 15.90 or 0.1% S&P 500 : 1,416.18 S&P 500 23-Nov : 1,409.15 Change : 7.03 or 0.5% US Dollar Index : 80.232 US Dollar Index 23-Nov : 80.267 Change : -0.035 or 0.0% Platinum Price Close Today : 1,603.10 Platinum Price Close 23-Nov : 1,615.10 Change : -12.00 or -0.7% Palladium Price Close Today : 686.25 Palladium Price Close 23-Nov : 667.60 Change : 18.65 or 2.8% 'Twas a hard week for the silver and GOLD PRICE, I'll explain why not as hard as it may seem. Silver and gold hardly ever ever decline into the year end. Also in the longer term charts: No damage has been done. Rather, the metals have merely touched back to support: support that has held so far. What of today? Silver lost 114.4c to 3320.4c while the GOLD PRICE lost $16.30 to close Comex at $1,710.9. This painted a pretty tape, but in the aftermarket gold was trading at $1,714.01 and silver at 3339c. Not exactly cowering. Critical support in gold, bear in mind, is $1,705. Low today hit $1,708.68, which was higher than Tuesday's $1,705.20. So gold has posted either double bottom or slightly higher lows. Coming out of European trading gold was doing just fine, thanks, betwixt $1,727 and $1,731. Lo and Behold, about the time Comex opened in New York, somebody started selling, taking gold down to $1,720 by 8:30. Another bout of selling hit just before 11, gapping gold down from $1,724 to $1,719. Declined into $1,708.68 about 2:30, and rose after the close. Today's decline merely took gold for another kiss on the neckline of that inverted head and shoulders, although it did pull it back beneath the 20 DMA ($1,722.76). The bounds are clear: gold must not break $1,705.50. Otherwise it drops to $1,665 (200 DMA) or uptrend line from the June low (now about $1,640, but rising). Overhead gold must -- must clear $1,755, the last high. This needs to happen soon. Next week. The SILVER PRICE five day chart doesn't look at all like gold's. Where gold shows a push off a cliff, silver's shows a V-bottom on Wednesday, with a sharp recovery yesterday and fall today to a HIGHER low than Wednesdays (3318c against 3291c). One day chart shows silver cruising along fine above 3400c until about 9:45 NY time, when it gapped down to 3380c, hovered, then gapped down again to 3340c. Final erosion by 1:15 had dragged silver down to 3318c and the low. In the aftermarket it climbed to 3340c. No problem at all appears on the 4 month SILVER chart. It began an uptrend off the 2 November low at 3066c, and if you draw a line under the lows, today's low stopped short of that uptrend line. Whoops, it also stopped shy of the 50 day moving average (3315c). Shows a market correcting, but refusing to break down. What are the bounds? Silver must not close below that uptrend line, call it the same level as the 50 DMA (3315c), period. Should it breach that mark, could fall to the rising trendline form June's low and hit that about 3025c today. The difference between a fool and a brave man charging into a cannon's mouth is whether he comes out alive. This is a risk I would take. Silver and gold have begun their next leg up, the correction lies in the past, seasonality is pushing them higher. I'm still buying silver and gold, and more whenever they become cheaper. Let the croakers croak, let the squawkers squawk, let the whiners whine. They were all doing that same thing when gold was $252 and silver $4.01. Veritas filia temporis. Stocks didn't prosper this week, closing a bare few points higher this week than last. Only palladium managed to rise. Biggest surprise was the US dollar, which, contrary to all expectation, justice, and gravity did not flow down the sewer this week. First, the currencies. The ugly dollar index traced out a head and shoulders top this week with a neckline at 80.05. What meaneth this? That the dollar index is highly unlikely to rise above 80.30, the top of the shoulders, and virtually assured to drop below 80.05. Of course, when the Nice Government Men are in the market pushing things this way and that for their own inscrutable but invariably nefarious ends, it may take a while for that technical bent to work itself out, but it will at last. Euro is poking at the downtrend line and overhead resistance, but keeps proving incapable of any meaty advance. Will probably jump one day next week, but I doubt that will last. Rose 0.08% today to $1.2988. After a five day rise the yen fainted again today, gapping down for a new low for the move at $121.26c/Y100, down 0.44%. I very much doubt the NGM around the world will stand by idle while the Japanese hone their competitive advantage by depreciating their currency below 118c/Y100. That's what I love to watch: the Midianites and Amalekites start fighting each other. US$1=Y82.47=E0.7699+.030117 oz Ag=0.000584 oz Au. I don't talk much about manipulation in silver and gold, because it doesn't take much talent or imagination merely to blame everything on the secret manipulators. Oh, yes, they manipulate the markets, but with that same success that attends all government efforts, keeping the gold price down from $252 in 2001 to $1,710.90 today and silver from $4.01 to $33.204 today. Yet they do manipulate them over the short term, and try to hit them at critical junctures, as when Gold is fixing to break over $1,800 and silver over $37.50. What success attends their wretched frauds, I have already pointed out. Stocks rose for the week, but have not yet made good their escape from beneath the drowntrend line. Dow added 3.76 today to 13,025.58 and S&P500 added 0.23 to 0.03%. Stocks will rally into year end, a bootless exercise. 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. 
|
| China Silver Demand — One Step Closer to the Edge Posted: 30 Nov 2012 05:00 PM PST by Dr. Jeffrey Lewis, Silver Seek:
This move shows that China is inching closer and closer to the silver market and is quietly nibbling away at Western demand for silver. When Will This Shift Influence Global Silver Prices? It's already well known that Chinese citizens are not only allowed, but encouraged to own precious metals like silver and gold.
|
| U.S. gold coins set for strongest November sales in 14 years Posted: 30 Nov 2012 04:38 PM PST 30-Nov (Reuters) — November sales of U.S. American Eagle gold coins are set to be the strongest in 14 years as uncertainty surrounding the U.S. fiscal crisis and the presidential election triggered safe-haven buying, dealers said. Occasional sharp price swings during early and late November also boosted bullion coin buying by investors and speculators alike, coin dealers said. …Investors have so far this month bought 131,000 ounces of American Eagles produced by the U.S. Mint, more than tripled last year's November sales and marked the strongest November since 1998, data from the Mint's website shows. November marked the second consecutive monthly rise after a dismal performance earlier this year. In October, the Mint sold 59,000 ounces versus 50,000 ounce in the same period last year. [source]
|
| Silver price edging towards key resistance level Posted: 30 Nov 2012 04:30 PM PST from Gold Money:
For over a year now, silver has been confined to a trading channel between roughly $26 and $35.50. It will be very interesting to see how it performs if we approach this upper boundary. We can expect strong resistance from the bears, as any sign that silver is consolidating above this price will act as a strong incentive for speculative money to race in on the long side, chasing the price rapidly higher in the manner we saw during late 2010 and early 2011.
|
| Guest Post: Let's Have A Depression Now Posted: 30 Nov 2012 03:46 PM PST Originally posted at Monty Pelerin's World, The United States is more than four years into its form of economic purgatory. The government pronounced the recession over in June of 2009. That announcement does not conform with reality or even subsequent government suspect data. Even the Administration-friendly New York Times knows better:
To believe the recession ended requires a bizarro interpretation of economics where bad is actually good and good is actually bad. 21st Century politics sees no need for truth. When government believes itself to be responsible for the economy and convinces the people of that, it has put itself into a box. In a world where government claims credit for good things, bad things ultimately become their responsibility as well. Recessions are bad things which government should not have allowed to happen or should fix quickly. The reality is that government does not create wealth or economic abundance. (They can create poverty, however.) When recessions occur, they threaten the myth of all powerful government. The first reaction of government is to do something regardless of whether something makes sense or not. The second phase is to declare the problem solved (in this case, claim the recession ended). This kind of politics is dangerous on two counts. First, government risks what little credibility it has left (which I might say is not necessarily a bad thing). Second, it causes government to pursue policies which reinforce its lies. It is these policies which created the current economic crisis in the first place. The country's economic problems began decades ago. In trying to cover them up with economic interventions (stimuli), government actions prevented the economy from correcting the imbalances that caused slow growth. From a political standpoint, economic policies encouraged institutions and people to use debt to live beyond their means. The massive debt buildup in both the economy and the government hid the underlying problems and allowed them to grow ever larger and more malignant out of sight. After decades of such interventions, the economy no longer is able to function efficiently. In order to remedy the problems, massive liquidations of debt and misallocated assets are necessary. There is no other way to achieve an economic cleansing. It may be possible to continue this economic charade with additional interventions, but there is a limit to how far it can be continued. Japan has achieved zombie existence for over two decades by refusing to face up to the imbalances in their economy. Our government has chosen the same course of "extend and pretend." There is no hope for a recovery until something like another Great Depression liquidates the built-up imbalances. No politician wants to be in office when that event occurs. Thus, they make matters worse for the country by continuing to spend money we don't have to prop up an economy that cannot and should not be saved. Their goal is not to repair the economy but to ensure the most favorable terms for their own re-election. As a result they continue to savage the future of the country in order to protect their own present. People will eventually regain control of their government. They always do. Unfortunately the process of history is slow and sometimes ugly. Multiple generations around the world have never known freedom. China and the Soviet Union are two examples that are just now transitioning toward freedom. Are we to enter some institutional dark ages where our grandchildren and their grandchildren do not experience freedom? It is possible because all governments prefer more power for themselves and less liberty for their citizens. The required change is so great as to be analogous to an addict trying to break his habit. Most addicts have to hit rock-bottom before reality intrudes. In the case of the US, we are going to hit rock-bottom when the economy collapses. That is likely to be within the next ten years and could be at the front end of that estimate. This world-changing event may (at least temporarily) drive a stake through the heart of big, oppressive welfare-state governments. There is no guarantee that government will shrink when this happens. Civil unrest is a likely outcome. Statists may attempt to use the crisis to further expand government. Martial law and other restraints are likely. Hitler used a similar situation to rise to power. Parts of the Constitution were emasculated under New Deal policies that "had to be done" to pull us out of the Depression. Of course, we never got out of the Depression until after the end of WWII. Economic pain and suffering will be great. Yet the economic calamity is unavoidable. It was pre-ordained by years of government interventions. Mathematical and economic laws will not be avoided. As stated by Ludwig von Mises:
We are coming off the biggest boom in the history of the world. If Mises was correct, and I believe he was, then Keynes was wrong (and I believe he was). Thus far all the Keynesian dollars expended have had little effect other than to make this country poorer. We are set up to have a Depression greater than the one in the 1930s. A Depression is not a good thing. Yet in this case, it may be the one event that can prevent a chapter in future history books entitled "The Demise of the Great American Empire." Unless citizens and politicians return to their senses, we will be both impoverished and living under tyranny. A reaction opposite that of the 1930s is a hopeful outcome. Despite the recent election, government is increasingly seen to be the problem. It is no longer viewed reliable, trustworthy or as a solution. Freedom is deeply ingrained in the American culture and most of us recognize how much we have already lost. The resurgence of books such as "The Road to Serfdom," "Atlas Shrugged" and others similar indicate the public is interested. Historically low poll numbers for all politicians and the rise of the Tea Party movement are further indicators. The economic trauma may provide the catalyst to return to the founders' concept of government. Totalitarianism needs the military. More than any other segment of society, the military respects and supports the Constitution. If push comes to shove, they are likely to defend the Constitution rather than the government. Government has reduced itself to little more than an insolvent zombie, staggering around awaiting the coup de grace that will end its misery. The coming economic collapse is that executioner. When collapse happens, efforts to increase government are will occur. They must be resisted strongly. The love of freedom and the experience with big government should overcome decades-long madness. No matter how things evolve, in the history books of the far future, there can be no better title to describe our current situation than "The Myth of Government." If we must have a Depression, let it begin today. It will be hard and dangerous, but it may be the last chance to get our country back. When it happens, we must all think and behave like Founding Fathers. To paraphrase Rahm Emanuel, this crisis will be too important to waste. The "greatest generation" handed us a gift and we fumbled it away by allowing government to run wild. We cannot turn this mess over to future generations. We must take our country back and remedy the problems.
|
| Harvey Organ – The Emerging Gold Shortage Posted: 30 Nov 2012 03:30 PM PST from FinancialSurvivalNetwork.com:
CLICK HERE FOR AUDIO INTERVIEW
This posting includes an audio/video/photo media file: Download Now |
| Posted: 30 Nov 2012 03:20 PM PST by Dan Norcini:
Both charts use last November 2011 as the starting point and carry on through the present trading session. See if you can pick out which one is the Continuous Commodity Index and which one is the Silver price. Surprised? You should not be. As I have stated repeatedly, silver is moving in near perfect tandem with the RISK TRADE. When risk assets are in vogue, silver will move higher; when risk aversion is the play, silver will move lower along with the rest of the commodity complex. Read More @ TraderDanNorcini.Blogspot.com
|
| Global Silver Mining Stocks Production Posted: 30 Nov 2012 03:14 PM PST In order to satiate the world’s growing hunger for silver, a lot of pressure has been placed on its supply chain. And with total annual supply recently exceeding 31k metric tons (1.0b ounces) for the first time ever, the suppliers of this white metal have so far made a valiant effort to meet demand. Silver demand is on the rise for a variety of reasons, in large part due to big increases in investment demand. And this has naturally created a structural imbalance that has spawned a major secular bull market. A bull in silver of course translates to higher prices. And silver’s much higher prices have provided ample incentive for the major sources of supply (recycling and mining) to boost output.
|
| Gold Possibility to Regain Its Medium-term Glitter Posted: 30 Nov 2012 03:10 PM PST 10 days ago, in our gold and silver stocks essay, we wrote that volatility in the mining stocks sector was mostly emotionally-driven. Since then some of that volatility seems to have transpired to the metals market. Gold dived $25 on Wednesday, immediately triggering rumors of misplaced trades or technical errors. The CME Group denied this had been the case and theories of a large player selling gold off in the morning sprung up like mushrooms.
|
| Pressure mounts on Turkey to end Iran Gold deal Posted: 30 Nov 2012 03:05 PM PST by Sajith Kumar, Bullion Street:
US authorities are reported to have conveyed the message to Turkey but the Turks refused to oblige by saying the deal doesn't breach any international laws and US sanctions only prohibit Iran from carrying out transactions in dollars. Major political parties and bureaucrats in the country are also in favor of the gold deal at the moment but resistances are also coming up, based on the fact that precious gold cannot be traded like that even for oil.
|
| Gundlach: "I'm Waiting For Something To Go Kaboom" Posted: 30 Nov 2012 03:01 PM PST Following some well-timed 'suggestions' in Natural Gas and Apple this year, the new bond guru has some rather more concerning views about the future of America. Reflecting on a dismal outlook progressing due to the fact that "Retirees take resources from a society, and workers produce resources", Gundlach has cut his exposure to US equities (apart from gold-miners and NatGas producers) noting their expensive valuation and low potential for growth. In a forthcoming Bloomberg Markets interview, the DoubleLine CEO warns we are about to enter the ominous third phase of the current debacle (Phase 1: a 27-year buildup of corporate, personal and sovereign debt. That lasted until 2008, when Phase 2 started, unfettered lending finally toppled banks and pushed the global economy into a recession, spurring governments and central banks to spend trillions of dollars to stimulate growth) as deeply indebted countries and companies, which Gundlach doesn't name, will default sometime after 2013. "I don't believe you're going to get some sort of an early warning," Gundlach warns "You should be moving now."
Excerpts (via Bloomberg): On Hard Assets:
On Bonds:
On Kaboom:
On Japan:
On Europe:
On USA:
On US Equities:
On Bernanke and The Fed:
On Obama and The Fiscal Cliff:
On Gundlach:
|
| Posted: 30 Nov 2012 03:00 PM PST by Scott Wright, Silver Seek:
Silver demand is on the rise for a variety of reasons, in large part due to big increases in investment demand. And this has naturally created a structural imbalance that has spawned a major secular bull market. A bull in silver of course translates to higher prices. And silver's much higher prices have provided ample incentive for the major sources of supply (recycling and mining) to boost output.
|
| Gold, Silver Rise On QE4 Currency Debasement Concerns Posted: 30 Nov 2012 02:43 PM PST Today’s AM fix was USD 1,728.25, EUR 1,329.53, and GBP 1,077.87 per ounce. Yesterday’s AM fix was USD 1,724.50, EUR 1,327.56, and GBP 1,076.47 per ounce. Silver is trading at $34.32/oz, €26.53/oz and &ound;21.50/oz. Platinum is trading at $1,621.00/oz, palladium at $683.30/oz and rhodium at $1,050/oz.
|
| Gold Price Forecast to Average $1920 in 2013 Posted: 30 Nov 2012 02:35 PM PST GOLD PRICES rose back to $1730 per ounce in early London trade on Friday – the same level seen just before last week's late jump and subsequent 2.0% sell-off on Wednesday. Silver touched a new 8-week high just shy of $34.40 per ounce, while the broader commodities market ticked lower. Major-government debt prices were flat. So too were European stock markets.
|
| SLA all the way! Mick's stacking silver, are you!? Posted: 30 Nov 2012 02:35 PM PST Friday night, jibber jabber thread!!!!
|
| SLA all the way! Mick’s stacking silver, are you!? Posted: 30 Nov 2012 02:35 PM PST Friday night, jibber jabber thread!!!!
|
| The Most Ridiculous Close To An Unimpressive Week Posted: 30 Nov 2012 02:25 PM PST With a late-day surge into the green for the S&P 500 futures on (as usual) absolutely no news at all (attributed to MSCI rebalancing) - that crossed the entire day's range in the space of 40 minutes, the Dow managed to just hold 13,000 and close green for the week. There was very significant volume and block size into the ramp as it pulled away from risk-assets as only a month-end move can magically achieve. In the same way as last Friday's close was just remarkably silly, today followed the same path - though we note that rates and credit were outperforming stocks most of the day and provided the target for the late-day surge. Once that target was closed, S&P 500 futures then melted-down around the close and after-hours. Utilities were the big winners on the week (+3.5%) as Financials and Energy lost around 0.7%. Silver crumbled to recouple with Gold (down around 2% on the week) while Copper gained 3%. Treasury yields steepened into the close with the 30Y pushing higher but ending -2bps (while the 10Y was -7bps). What a crazy stop-hunting, algo-driven, VWAP-reverting end to a week of political volatility.
It seems our tweet came true - but failed in the end...
The S&P 500 futures up close and personal - just crazy at the close...bouncing off VWAP and unchanged... on huge volume... (h/t @eminiwatch)
Equity indices ended the week in the green - though barely for the Dow and S&P...
and for the month - the Dow closes red and the S&P just green...Maybe more interesting is the fact that from the close before the election result (11/6) the NASDAQ is unchanged, SPX -0.9%, and Dow and Transports -1.7%
with Utilities the week's big winners (and Fins and Energy losers)...
And among the financials - only Morgan Stanley managed gains...
All-in-all - broad risk assets were not impressed and certainly did not play along into the close but the ETFs across the capital structure provided some support (as HYG was levered up - still considerably rich to its intrinsics)...
as is clear below, stocks overshot to the downside on Tuesday/Wednesday relative to crediot but this week's inflows have once again supported the HYG high-yield bond ETF (even as its intrinsics remain flat (lower pane shows the richness of the ETF to its underlying portfolio). The green oval upper right shows the crazy swing higher in stocks at the close today which appeared to be a catch up to HYG - once hit, heavy volume hit HYG and SPY also tanked back down...
VIX jumped to 15.87% at the, down on the month but up for the week...
Commodities were widely mixed but precious metals recoupled at the end...
and Treasuries saw curve steepening to close the week though the entire curve dropped on the week (and 2s10s30s signaled considerably more risk-off than cliff-off)...
Charts: Bloomberg and Capital Context
|
| Gold and Silver Disaggregated COT Report (DCOT) for November 30 Posted: 30 Nov 2012 02:18 PM PST 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. Gene Arensberg for Got Gold Report.
|
| Gold primed to gain if budget talks fail: analyst Posted: 30 Nov 2012 02:12 PM PST
Typically, gold and the dollar move in opposite directions. When the dollar falls in value, holders of gold demand more of the currency in exchange for the precious metal. However, that relationship breaks down in times of extreme crisis, says Nicholas Brooks, head of research and investment strategy at ETF Securities in London. As politicians in Washington haggled over the debt ceiling last summer, investors bought both Treasury securities, pushing up the value of the dollar, and gold. That surge in demand pushed gold prices higher, with the metal climbing to a record close $1,900 an ounce, after Standard & Poor's cut its rating on the U.S. government's debt in August. "We could see a similar pattern now if people lose faith in the U.S. to responsibly deal with its fiscal balances," said Brooks, speaking at a conference in New York Thursday. [source]
|
Gold is experiencing an accelerating trend, represented by a difference in the price level between the 50WMA and 200WMA. The price gap between the two averages is plotted below, overlaid with a curve which visually demonstrates its exponential growth rate.
Today 25-year veteran Caesar Bryan told King World News that the Japanese are getting ready to enter the gold market in size. Here is what Bryan, from Gabelli & Company, had to say about this fascinating situation: "Last time we spoke we talked a little bit about what was going on in Japan. Two days ago a former advisor to the LDP, Abe, came out with some advice that the Bank of Japan should add another $60 trillion yen, which is about $750 billion, to the monetary base.
In our first installment of this series we explored the concept of stock to flow in the gold markets being the key driver of supply/demand dynamics, and ultimately its price. To briefly summarize the STF concept, the "stock" of existing gold is the total amount ever mined and the "flow" is the amount of physical gold available for purchase on any given day. Obviously the more flow, the more for sale and presumably, the lower the price. Today we are going to explore the paper markets and, importantly, to what degree they distort upwardly the "flow" of the physical gold market. We believe the very existence of paper gold creates the illusion of physical gold flow that does not and physically cannot exist. After all, if flow determines price – and if paper flow simulates physical metal movement to a degree much larger than is possible – doesn't it then suggest that paper flow creates an artificially low price? If the physical metal does not actually flow along with paper representations of flow, then isn't it true that the current stock to flow ratio may already be much higher than previously imagined?
On November 29 the Domestic Monetary Policy Subcommittee of the 
UKIP is now the 'second party of the North' Farage declares as panicked 
After Wednesday's gold and silver price plunges – no doubt 
Harvey Organ has been a precious metals investor and student of the market. He's be writing a blog and monitoring the paper precious metals markets daily. During this time he has uncovered a number of irregularities that have led him to believe that the central banks of the West have either sold or leased out all their sovereign gold. The Chinese, Russians and others are buying up every ounce they can. Harvey believes that the Comex will fail and then everything is going to hit the fan. He may be right.
I have posted the following composite chart without any easily discernible labels to illustrate why I analyze the silver market in the manner that I have been doing for some time now.
After Turkey confirmed it's gold for oil deal with Iran, it remained under immense pressure from the West, particularly from the US to drop the deal.
In order to satiate the world's growing hunger for silver, a lot of pressure has been placed on its supply chain. And with total annual supply recently exceeding 31k metric tons (1.0b ounces) for the first time ever, the suppliers of this white metal have so far made a valiant effort to meet demand.
| You are subscribed to email updates from Save Your ASSets First To stop receiving these emails, you may unsubscribe now. | Email delivery powered by Google |
| Google Inc., 20 West Kinzie, Chicago IL USA 60610 | |
No comments:
Post a Comment