Gold World News Flash |
- Gold versus Industrial Metals
- Get Ready for Some Major Disinformation about America's Gold
- The Unadulterated Gold Standard Part V (Real Bills)
- Asian Metals Market Update
- Unadulterated Gold Standard Part V (Real Bills)
- Gold Has a Clear Advantage in Developing Global Currency War ? Here?s Why
- Turk - Central Planners Are About To Completely Lose Control
- Treasury Dept Releases Results of NY Fed Gold Audit, States Gold More Pure Than Previously Thought!
- Marc Faber Buy Gold To Protect Against The Next Crisis – YouTube
- The Fed's D-Rate: 4.5% At Dec 31, 2013... And Dropping Fast
- Leverage Insanity Returns!
- Elijah Johnson- Dollar Collapse in 5-10 Years – YouTube
- Are We Days Away From A Financial Collapse ? – YouTube
- Team: New Venture Update 19 February 2013
- Gold Price Unchanged Over Presidents' Day
- THE SILVER BOMB: Collapse is Happening NOW… $500+ Silver IS Coming [Part 2] – YouTube
- Gold COT Imbalanced, Becoming Bullish
- Gold Has a Clear Advantage in Developing Global Currency War – Here's Why
- Guest Post: What Warren Buffett Doesn’t Understand About Investing
- Chart of the Week: Gold
- What Does a ?Troy? Ounce of Gold Mean? What Does 18 or 24 ?Karat? Gold Mean?
- Peter Schiff 2013 – What is happening with Gold? – YouTube
- Three Must-Haves for the New Generation of Gold Companies: Accountability, Accountability and Accountability
- Consolidated Goldfields Retains Gold Seek LLC for Corporate Communications and Announces Bonus Program
- Paul Versus Joe
- "Bloomberg" Gold Report Misses the Mark
- HYPERINFLATION and SILVER CONFISCATION COMING? – BrotherJohnF & Chris Duane – PT 2 – YouTube
- Robert Wenzel: Get ready for some major disinformation about America's gold
- Pollution Helping Palladium’s Run? Rohit Savant of CPM Group – YouTube
- Bill Fleckenstein: They've been saying the gold bull is over for 12 years
- Gold at N.Y. Fed is intact, some purer than thought, audit finds
- What Does a “Troy” Ounce of Gold Mean? What Does 18 or 24 “Karat” Gold Mean?
- David Baker's Three Must-Haves for the New Generation of Gold Companies: Accountability, Accountability and Accountability
- What Will ‘Debt Jubilee’ Look Like?
- Audit of gold at New York Fed fails to cover leases and swaps
| Posted: 19 Feb 2013 08:03 AM PST The financial markets have begun 2013 in remarkably similar fashion to how they began 2010, 2011 and 2012. In each of these preceding three years the average market participant became optimistic about global economic growth during the first quarter, leading to weakness in gold relative to the industrial metals. Here we go again. | ||||||||||||||||||||||||
| Get Ready for Some Major Disinformation about America's Gold Posted: 19 Feb 2013 12:32 AM PST Robert Wenzel | Economic Policy Journal An audit of the gold held at the New York Federal Reserve has been completed and the disinformation campaign has started. Notice how LaTi reports the story: The U.S. government's gold in New York is safe in a vault underneath Manhattan, and some of the precious metal there is purer than [...]  This posting includes an audio/video/photo media file: Download Now | ||||||||||||||||||||||||
| The Unadulterated Gold Standard Part V (Real Bills) Posted: 19 Feb 2013 12:20 AM PST keith weiner | ||||||||||||||||||||||||
| Posted: 19 Feb 2013 12:02 AM PST There are not much economic releases today. Investment demand will be the key for gold and silver. In my view gold and silver should rise as value based buying will come up in Asia and across the globe. Silver March futures are expiring next week and at lower prices averaging will be done by those who are long at higher prices. This will prevent silver prices from another crash. Copper and base metals will be dependent on the quantum of Chinese demand as Chinese factories start to reopen. | ||||||||||||||||||||||||
| Unadulterated Gold Standard Part V (Real Bills) Posted: 18 Feb 2013 11:40 PM PST In Part I, we looked at the period prior to and during the time of what we now call the Classical Gold Standard. It should be underscored that it worked pretty darned well. Under this standard, the United States produced more wealth at a faster pace than any other country before, or since. There were problems; such as laws to fix prices, and regulations to force banks to buy government bonds, but they were not an essential property of the gold standard.
In Part II, we went through the era of heavy-handed intrusion by governments all over the world, central planning by central banks, and some of the destructive consequences of their actions. We covered the destabilized interest rate, foreign exchange rates, the Triffin dilemma with an irredeemable paper reserve currency, and the inevitable gold default by the US government which occurred in 1971.
In Part III, we looked at the key features of the gold standard, emphasized the distinction between money (gold) and credit (everything else), and looked at bonds and the banking system including fractional reserves.
In Part IV, we discussed the problem of clearing. The problem of clearing arises when merchants deal in large gross amounts, on which they earn small net profits. They would not typically have the gold coin to pay for the gross value of the goods they purchase. This is an intractable problem in a strict gold-coin-only system and it only grows if specialized enterprises are added.
We considered the mechanics of Real Bills. It is interesting that goods flow from raw material producer to the consumer but the money flows from consumer to raw material producer. Without government involvement, and without banks, Real Bills circulate spontaneously.
In this final Part V, we look at the economics of Real Bills (or "Bills" for short). In Part IV, we noted that a Real Bill is credit that is not debt, so let's start here.
The Real Bill is credit provided for clearing, without lending or borrowing. It is different than a bond. To review the bond, in Part III we showed how it arises out of the need to save. People must plan for retirement and senescence during their working years. Even if there is no way to lend at interest, this need still exists. So people hoarded part of their income by buying a commodity with a narrow bid-ask spread that was not perishable. Salt and silver are two commodities that were used for this purpose. For many reasons saving, in which one lends one's wealth at interest, is superior to hoarding. Thus the bond was born.
The Real Bill is quite different. It isn't lending at all. It is a clearing instrument that allows the goods to move to the gold-paying consumer before said consumer pays with gold. The Real Bill does not earn interest, and there are no monthly payments. The Real Bill is an opportunity to buy gold at a discount. The Real Bill sells in the market for less gold than its face value, based on the discount rate and the time to maturity. For example, a 1000g Bill would sell for 9975 grams 90 days from maturity, assuming the discount rate was 1%. When the merchant has sold all of the goods to consumers, and thus has all of the gold, he pays the bill with 1000g of gold.
By contrast, Bills occur wherever people consume. It is certain that people will eat bread tomorrow. Therefore, it is not risky to provide the gold to clear the flour sale. Bills come into existence because of the chronic need to consume. Bills increase in quantity at times of high seasonal consumer demand (such as Christmas) and decrease at times of low demand.
Bills provide the responsiveness necessary for a large and complex economy, without the sinister elements that come with "flexible" irredeemable paper money, central banking, and fiat elements such as "legal tender" laws. This is because Bills respond to market signals (the chief "virtue" of irredeemable paper money, or indeed any government interference in markets, is that does not). Most importantly, every Real Bill is extinguished after it has cleared one delivery of goods. Real Bills are said to be "self-liquidating". Unlike the mortgage on a building, or the bond that finances a factory, the Real Bill is paid in full upon the sale of the asset it financed.
Real Bills are a simple mechanism, but they enable some very elegant arbitrages. For example, seasonal businesses have a problem for part of the year. What does the heating oil distributor do in the spring and summer? As he sells down his stocks of oil, he does not want to buy more oil. He can buy Bills, perhaps issued by a garden supply store that is in its busy season (and therefore is generating Bills). In this vignette, the heating oil distributor is directly financing the inventories of the garden supply! Without a bank or any other intermediary needed, it's more efficient.
There is a subtler arbitrage, between retail merchandise and Real Bills. Every retailer can calculate a rate of return for every product on the shelves. The goods are financed by the issuance of Bills; it makes no sense to carry any goods that have a return lower than the discount rate. Instead, the retailer should not stock those goods and put spare capital into the Bills issued to finance higher-yielding merchandise. Today, without a market discount rate, even in the information age with software to track everything, many retailers make poor decisions of what merchandise to carry.
There are many other even more subtle arbitrages, but let's look at one that is especially interesting. It is basic Econ 101 that if a natural disaster strikes then prices must rise. For example, if the wheat crop is hit by hail then there is a wheat shortage in the region. Prices must rise before wheat is diverted to the empty bakeries and hungry people. Real Bills provide a buffer mechanism. If the shortage is local (and hence small in proportion to the global market), what happens is that the discount rate falls in that region.
Let's look at this. The Real Bill arises, as discussed above, from consumption. In case of shortage, there is greater confidence that goods shipped into the region will be consumed even more rapidly. A lower discount rate means that the distributor is effectively paid a higher amount. This will attract goods out of other regions where there is no shortage. It is not necessary for the baker to pay a higher price on flour, or for the consumer to pay a higher price for bread. What is necessary is that the distributor receives a higher price to divert the flour to the region. The lower discount rate provides that higher price.
Real Bills serve a vital role in the banking system, particularly for the savings bank. To back a demand deposit account, the bank can have 1/3 of the assets in gold and 2/3 in Real Bills. It must be emphasized that this has nothing to do with fractional reserves! The Real Bill is not lending. More importantly, the Bill market cannot go "no bid". All Bills will be fully paid in 90 days, with the average being 45 days.
In contrast, with the lending of demand deposits (a form of duration mismatch), the system becomes unstable. This is not due to the risk of default per se. It is because the banks expand credit into a structure that is not in accord with the wishes of the savers. Eventually, it is guaranteed to collapse in a no-bid bond market with panic, liquidations, defaults, and bankruptcies.
The problem with duration mismatch is not merely one of liquidity. If today's crisis, ongoing after more than four years(!) of flailing by central banks shows anything, it is that a mismatched and unbalanced credit structure cannot be fixed with liquidity. What happened is that projects for more and higher-order factors of production were started. But there was insufficient real capital to finance them, so those projects must be written offs with losses taken by banks and investors. The demand deposit backed by Bills does not create this problem.
In a free market, if people want a bank to provide only safe storage of gold with perhaps payment processing, then that service will exist for a fee. Such an account will effectively have a negative rate of interest. Most people prefer not to pay fees, and to earn a nominal rate of interest (in gold, of course there is no currency debasement so even 0.01% is positive). The Real Bill makes this possible.
Real Bills are a topic that could fill an entire book. The goal of parts IV and V iof this series is to provide an overview, show some of the elegant mechanisms of the Bills market, and address some of the controversy that has swirled around Real Bills from at least the time of Ludwig von Mises, and more recently when Professor Antal Fekete published his ideas about them on the Internet.
To conclude this entire series on the Unadulterated Gold Standard, it is fitting to provide the formal definition now that the reader has sufficient understanding of the concepts and ideas.
The unadulterated gold standard is a free market in money, credit, interest, and discount based on the right of the people to hold and use gold coins, and which includes Real Bills and bonds.
As we could only hint in this series, there are numerous specialists conducting transactions that are not obvious (or even counterintuitive) and the credit market can evolve into a structure that is quite complex. So long as there is no force or fraud involved, the system remains stable under a gold standard.
Dr. Keith Weiner is the president of Gold Standard Institute USA, and CEO of Monetary Metals. Keith is a leading authority in the areas of gold, money, and credit and has made important contributions to the development of trading techniques founded upon the analysis of bid-ask spreads. Keith is a sought after speaker and regularly writes on economics. He is an Objectivist, and has his PhD from the New Austrian School of Economics. He lives with his wife near Phoenix, Arizona. | ||||||||||||||||||||||||
| Gold Has a Clear Advantage in Developing Global Currency War ? Here?s Why Posted: 18 Feb 2013 10:36 PM PST [INDENT]*"Follow the [COLOR=#0000ff][U]munKNEE" [/U][/COLOR]via twitter & Facebook or Register to receive our daily Intelligence Report (Recipients restricted to only 1000 active subscribers) [/INDENT]There is an increasingly disorderly currency war going on out there, and the advantage of gold is clear– they can’t print it, they can’t default on it, and there will always be demand for it. Simply put, in the global currency wars, owning gold is like abandoning the battlefield altogether. Words: 270; Charts; 2 So writes Tim Price, Director of Investment at PFP Wealth Management in the UK, in a guest post* at [url]www.sovereignman.com[/url] entitled What Warren Buffet doesn't understand about investing. [INDENT]This article is presented compliments of [B]www.FinancialArticleSummariesToday.com (A site for sore eyes and inquisitive minds) and [COLOR=#ff0000]www.munKNEE.com [/COLOR](Your Key to Making Money!) and may have been edited ([ ]), abridged (…) and/or reformatt... | ||||||||||||||||||||||||
| Turk - Central Planners Are About To Completely Lose Control Posted: 18 Feb 2013 10:25 PM PST  Today James Turk told King World News that "... central planners have hijacked the world's monetary system," and they are about to completely lose control. Here is what Turk had to say: "After a week like last week, Eric, I always ask myself what if anything am I missing? So I spent a lot of time this weekend going through the basics, and I have concluded that the premise upon which I have been recommending the ongoing accumulation of gold and silver still holds."This posting includes an audio/video/photo media file: Download Now | ||||||||||||||||||||||||
| Treasury Dept Releases Results of NY Fed Gold Audit, States Gold More Pure Than Previously Thought! Posted: 18 Feb 2013 10:25 PM PST from Silver Doctors:
The audit reportedly claims that in 3 of 367 tests of the gold's purity, the gold was more pure than Treasury records had previously indicated, and as a result has increased the book value of the US' gold holdings by 27 ounces. Nothing to see here Germany, Switzerland, Netherlands, et al. No tungsten here, gold is even more pure than we thought! | ||||||||||||||||||||||||
| Marc Faber Buy Gold To Protect Against The Next Crisis – YouTube Posted: 18 Feb 2013 10:14 PM PST Check our website daily at... [[ This is a content summary only. Visit http://www.figanews.com for full Content ]]  | ||||||||||||||||||||||||
| The Fed's D-Rate: 4.5% At Dec 31, 2013... And Dropping Fast Posted: 18 Feb 2013 10:09 PM PST In April of 2010, Zero Hedge first brought up the topic of the Fed's DV01, or the implicit duration risk borne by the Fed's burgeoning balance sheet which at last check will approach 25% of US GDP by the end of 2013 (tangentially, back in 2010 the Fed's DV01 was $1 billion - it is nearly $3 billion now and rising fast). Recently, we have noticed that the mainstream media has, with its usual 2 year delay, picked up on just this topic of the implicit and explicit risk borne by Bernanke's grand (and final) monetary experiment. And slowly but surely they are coming to the inevitable conclusion (which our readers knew two years ago), that the Fed has no way out? Why? Ray Stone of Stone McCarthy explains so simply, a Nobel prize winning economist can get it. From Stone McCarthy
In other words, at Dec. 31, 2013, a 4.5% interest rate (or, as we call it, the D-Rate) is where the Fed starts losing money. And then, if the Fed waits another year, the NIM breakeven is 3.5%... if the Fed then waits another year, the NIM breakeven drops to a minuscule 2.5%... and so on until year after year, the tiniest rise in rates will force the Fed approach Congress and explain why suddenly, not only is it not remitting interest income to the Treasury, but why just as suddenly, there is now a credit balance, that has to be funded by the Treasury (a move which monetarily will require the Fed to bail itself out, but which politically and economically will be an epic and final hit to the credibility of the Fed, as the Fed will be officially printing money just to print money). Of course, the above analysis assumes the Fed delays and avoids exiting QE in 2013, and then 2014 (and so on) as this is the last instrument Bernanke and his successor have to push up the stock market, never mind the economy, the unemployment rate or inflation. Which the Fed will have no choice but do, and yet the longer it build the wall of QE worry, the greater the negative sensitivity to even the smallest increase in interest (and IOER) rates, if and when inflation picks up and Bernanke is taken to task with his "15 minutes" promise of eliminating hyperinflation. In other words, while QE4EVA may be unlimited in the eye of the beholding Chairman, it is very much limited by the amount of reserves pumped into the system, and the amount of cash that Ben will have to pay banks as interest on their excess reserves. Finally, as once again Zero Hedge readers know well ahead of everyone, it will be the foreign banks that will be the proud recipients of the tens or hundreds of billions of IOER funds when the inevitable IOER rate hike starts. This was explained here:
Expect the MSM to figure out that it is precisely the foreign banks operating in the US, which now hold well more than half of all excess reserves in circulation, that will be the majority benefactors of the dollar bonanza that will be unleashed once the IOER begins its trickle up, in the next few years (or months at the rate record gasoline prices are soaring). Sadly, by then will we have far greater problems as a result of nobody once again understanding what is really going on behind the scenes. | ||||||||||||||||||||||||
| Posted: 18 Feb 2013 09:20 PM PST by Andy Hoffman, MilesFranklin.com:
In the year 2000, the largest equity bubble since the Great Depression burst; prompting the Federal Reserve and other Central banks to commence the largest, most comprehensive MONETARY EASING in global history. This "policy" – spearheaded by "Maestro" Greenspan; simply put off the inevitable for eight years; and in doing so, made it MUCH WORSE – and, for that matter, unfixable. Not only did such insanity foster EXTRAORDINARY credit excesses – in Federal governments, municipalities, the private sector, and households; but MORAL HAZARD that nearly destroyed the global economy. In 2008, the "fruits" of this policy were realized – in the form of a GLOBAL MELTDOWN that continues to require TENS OF TRILLIONS of new MONEY PRINTING just to "kick the can" a few more months… | ||||||||||||||||||||||||
| Elijah Johnson- Dollar Collapse in 5-10 Years – YouTube Posted: 18 Feb 2013 09:02 PM PST Check our website daily at... [[ This is a content summary only. Visit http://www.figanews.com for full Content ]]  | ||||||||||||||||||||||||
| Are We Days Away From A Financial Collapse ? – YouTube Posted: 18 Feb 2013 08:56 PM PST Check our website daily at... [[ This is a content summary only. Visit http://www.figanews.com for full Content ]]  | ||||||||||||||||||||||||
| Team: New Venture Update 19 February 2013 Posted: 18 Feb 2013 08:38 PM PST First up, some admin; when you subscribe please ensure that you have bob@gold-prices.biz added to your safe sender list, and that your emails are not being blocked by a spam filter. Otherwise we have no way of contacting you and our emails to you get bounced back to us. The precious metals markets are currently being battered | ||||||||||||||||||||||||
| Gold Price Unchanged Over Presidents' Day Posted: 18 Feb 2013 07:54 PM PST Gold Price Close Today : 1608.80 Change : 0.00 or 0.00% Silver Price Close Today : 29.85 Change : 0.00 or 0.00% Gold Silver Ratio Today : 53.90 Change : 0.00 or 0.00% Franklin Sanders didn't publish commentary today, if he publishes later it will be available here. 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 © 2013, 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. | ||||||||||||||||||||||||
| THE SILVER BOMB: Collapse is Happening NOW… $500+ Silver IS Coming [Part 2] – YouTube Posted: 18 Feb 2013 06:17 PM PST Check our website daily at... [[ This is a content summary only. Visit http://www.figanews.com for full Content ]]  | ||||||||||||||||||||||||
| Gold COT Imbalanced, Becoming Bullish Posted: 18 Feb 2013 05:41 PM PST Changes in gold futures positioning of the largest reporting traders very interesting and have now become contrary bullish. SOUTHEAST TEXAS – Changes in the positioning of very large traders of paper gold futures in the most recent Commodity Futures Trading Commission (CFTC) commitments of traders (COT) report (February 15 for data as of the 12th) are important and very unusual. As Got Gold Report Subscribers (Vultures) already know, because of our commentary directly in the linked technical charts, the aggressive sell down this past week (Gold -$57 to $1,609 and Silver -$1.59 to $29.76) was not, repeat not, fueled by aggressive selling by the Big Hedgers or bullion banks (contrary to repetitive uninformed or misinformed bloggers who, embarrassingly, try to fit everything into a single bank-hating theory). Instead, with gold-buying China out of the market this past week for their New Year holiday, Japan out part of the week, an earthquake of sorts caused by long-only pension funds announcing an exit from commodities (well after the fact for many of them we might add), media focus on two or three high profile actors who sold positions in SPDR Gold Shares (GLD) (Soros, Bacon, et al, back in Q4 of 2012, but only announced in Form 13 filings this week) ... and with The Big Markets still showing surprising strength, the selling pressure on gold comes not from the bullion banks or the hedgers they trade for, but from Managed Money – the trend following Funds and the investors they trade for. As the data will show in just a moment, we have reached a point where the positioning of the largest traders of gold futures is very imbalanced. The setup is practically begging for a massive, very violent reaction just ahead. We only very rarely see this kind of imbalance, but when we do it can get pretty dangerous for traders on both sides of the battlefield for a very short period of time. Huge elephants, capable of buying/selling and influencing hundreds or even thousands of contracts in minutes, are battling it out now in the futures – and in the OTC physical and forwards - and we mice need shelter until the battle has declared a new victor. Having been profitably stopped out of gold futures last month, we watch the battle underway from the safety of a "sideline cave!" To understand what is going on we first have to see where the traders were positioned as of the close on Tuesday, Feb 12. (Gold closed $1,651.07 already down $21.66 or 1.3% from the prior COT week. Silver $31.09, down $0.70 or 2.2%.) So the sell-down was already well on its way and the bears had the ball then. Recall that was the second day of China being mostly out of the physical gold market. Never forget that futures answer the physical market, not the opposite. As the data will show, what we have is one of the rare instances when the usually long Funds (Managed Money) have taken an unusually large (actually record large) short position even while maintaining significant long positions. As the data will also show clearly the usually short Producer Merchants, the natural hedgers and the bullion banks they trade through, have not increased their hedging and instead have seen fit to have a very low level of hedging with gold having fallen to the $1,650s. We suspect that the very smart hedgers are even less hedged now with gold having blown through stops to test $1,600. The growing selling pressure finally broke through the level where a large number of stops had accumulated on Friday, giving the Funds an unusual short term victory – on the short side. The normally mostly long Funds have engineered a short term play normally attributed to the guys on the other side of the battlefield. Namely, they just pulled a short raid on gold. The Big Irony is that despite the obvious and clear data to the contrary, one particular camp out there will continue to blame the bullion banks for this sell down. To continue reading, please log in or click here to subscribe to a Got Gold Report Membership | ||||||||||||||||||||||||
| Gold Has a Clear Advantage in Developing Global Currency War – Here's Why Posted: 18 Feb 2013 05:03 PM PST
There is an increasingly disorderly currency war going on out there, and the So writes Tim Price, Director of Investment at PFP Wealth Management in the UK, in a guest post* at www.sovereignman.com entitled What Warren Buffet doesn't understand about investing.
Price goes on to say in further heavily edited excerpts; Many investors are losing faith in gold on the basis that its price in US dollars has recently declined. Context is everything. Express the price of gold in another currency, the Japanese Yen, [see chart below] and gold looks relatively buoyant so it comes down to what sort of money you want – and in an environment of competitive currency devaulation, it's an important choice to make.
[To decide what sort of money you want]… the chart [below] is used by fund managers at Stratton Street Capital to help assess sovereign credit quality. They suggest, and we [concur], that it also has merit in assessing likely currency movements too.
In a global deleveraging that is likely to persist for some years, the heavily indebted countries (the darker colors in the chart above) will desperately need to attract foreign capital to help service their heavy debt loads and, in order to do so, they will likely devalue their currencies but one currency it doesn't highlight is gold. There is an increasingly disorderly currency war going on out there, and the advantage of gold is clear– they can't print it, they can't default on it, and there will always be demand for it. Simply put, in the global currency wars, owning gold is like abandoning the battlefield altogether.
* http://www.sovereignman.com/finance/what-warren-buffett-doesnt-understand-about-investing-10874/ (Written by: Tim Price; © Copyright 2012 Sovereign Man, All rights reserved )
Related Articles:
I expect the eventual endgame to this whole Keynesian monetary experiment that has been going on ever since World War II [will] finally terminate in a global currency crisis. [That being said,] I'm starting to wonder if we aren't seeing the first domino – the Japanese yen – start to topple…[It has] cut through not only the 2012 yearly cycle low, but also the 2011 yearly cycle low and never even blinked [and should it continue its steep decline] and break through the 2010 yearly cycle low [of 105.66] I think we have a serious currency crisis on our hands. Needless to say, if the world sees a major currency collapse… it's going to spark a panic for protection – to gold and silver. Wouldn't it be fitting that at a time when they are completely loathed by the market they are about to become most cherished? [This article analyzes the situation supported by 3 charts to make for a very interesting read.] Words: 620; Charts: 3 2. The Currency War: Which Country Will End Up With the Fastest Currency in the Race to the Bottom?
We believe that we are in the "competitive devaluation" stage presently [see graph below] as country after country is printing money in order to lower rates and doing whatever possible to devalue their currency – to have the fastest currency in the…race to the bottom – in order to export their goods and services. [The next stage will be protectionism and tariffs. This article gives an update on the race to debase.]
| ||||||||||||||||||||||||
| Guest Post: What Warren Buffett Doesn’t Understand About Investing Posted: 18 Feb 2013 04:32 PM PST Submitted by Tim Price of Sovereign Man blog, “Price is what you pay; value is what you get.” Warren Buffett’s aphorism has been rightly celebrated. But to be a true value investor, it helps to have values. Courtesy of near-zero interest rates and global competitive currency debauchery, it is increasingly difficult to assess the value of anything, as denominated in units of anything else. To put it another way, the business of investing rationally becomes problematic when a significant number of market participants are pursuing maximum nominal returns without a second thought as to the real (inflation-adjusted) value of those returns. Hedge fund manager Kyle Bass alluded to this problem recently when he pointed out that the Zimbabwean stock market had been the last decade’s best performer, but that owning the entire index would only buy you three eggs. It is not just Zimbabwe. Markets everywhere, in just about everything, have now decoupled not just from their underlying economies but from reality. There are signs that Buffett himself has decoupled from the value investing philosophy that made him the world’s most successful investor. Berkshire Hathaway is paying almost 20 percent more than Heinz stock’s all-time high in the deal announced last week, and the equivalent of 21 times 2013 earnings as opposed to the 16 times multiple which is the last decade’s average. Say what you like about the business, but Buffett has not bought it cheaply. To us, the more intriguing aspect to Warren Buffett is that he gives every indication of not understanding money. As he says, gold “gets dug out of the ground in Africa, or some place. Then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head.” Note that phrase: “It has no utility”. But utility, usefulness, purpose, value comes down to context. Context is everything. As Adam Fergusson bleakly put it in his moving account of Weimar Inflation in ‘When Money Dies’, “In hyperinflation, a kilo of potatoes was worth, to some, more than the family silver; a side of pork more than the grand piano. A prostitute in the family was better than an infant corpse; theft was preferable to starvation; warmth was finer than honour, clothing more essential than democracy, food more needed than freedom.” Buffett is chained to a rock of convention. He is hardwired to pursue money and he is very good at that pursuit. But he is not well programmed to consider the relative utility of money or its attributes as a lasting store of value. Since 2000, the price of gold has outperformed the price of Berkshire Hathaway stock by over 300%. No particular surprise, then, that he should hate the stuff. Likewise, many investors are losing faith in gold on the basis that its price in US dollars has recently declined. Context is everything. Express the price of gold in another currency, the Japanese Yen, and gold looks relatively buoyant:
So it comes down to what sort of money you want. And in an environment of competitive currency devaulation, it’s an important choice to make. In making that decision, this helpful chart is used by fund managers at Stratton Street Capital to help assess sovereign credit quality. They suggest, and we believe, that it also has merit in assessing likely currency movements too.
In a global deleveraging that is likely to persist for some years, the heavily indebted countries (the darker colors in the chart above) will desperately need to attract foreign capital to help service their heavy debt loads. And in order to do so, they will likely devalue their currencies. But one currency it doesn’t highlight is gold. There is an increasingly disorderly currency war going on out there, and the advantage of gold is clear– they can’t print it, they can’t default on it, and there will always be demand for it. Simply put, in the global currency wars, owning gold is like abandoning the battlefield altogether. | ||||||||||||||||||||||||
| Posted: 18 Feb 2013 04:24 PM PST Gold is in a bull market; it is at support. Despite the questionable fundamental picture, I believe this represents a good buying opportunity as price sits at support.
cow.2.17.13.gold from ARL Advisers, LLC on Vimeo. TacticalBeta offers a FREE Newsletter: | ||||||||||||||||||||||||
| What Does a ?Troy? Ounce of Gold Mean? What Does 18 or 24 ?Karat? Gold Mean? Posted: 18 Feb 2013 04:24 PM PST "Follow the [COLOR=#0000ff][U]munKNEE"[/U] [/COLOR]via twitter & Facebook or Register to receive our daily Intelligence Report (Recipients restricted to only 1000 active subscribers)* When*the price of gold is mentioned as costing "x dollars per troy ounce"*do you fully appreciate the signifance of the term “troy”? When looking to buy gold jewellery do you fully understand what the difference is between an item that is 10 “karat” gold and another item stamped 18 “karat” gold (other than that it is much more expensive)? Let me explain. Words: 587 So*writes Lorimer Wilson, editor of www.munKNEE.com (Your Key to Making Money) and*www.FinancialArticleSummariesToday.com*(A site for sore eyes and inquisitive minds). Please note that this paragraph must be included in any article reposting with a link* to the article source to avoid copyright infringement. Wilson goes on to say: Definition of "Karat" The term “karat” (kt)*is used to describ... | ||||||||||||||||||||||||
| Peter Schiff 2013 – What is happening with Gold? – YouTube Posted: 18 Feb 2013 04:11 PM PST Check our website daily at... [[ This is a content summary only. Visit http://www.figanews.com for full Content ]]  | ||||||||||||||||||||||||
| Posted: 18 Feb 2013 03:42 PM PST Mining companies have lost the trust of investors, says David Baker, managing partner at Baker Steel. Baker sees the gold market as at a watershed point and the miners must change to stay afloat. In this interview with The Gold Report, Baker sets out his prescription for nursing the industry back to health. Will the restrictions his company and other investors are putting on gold companies increase reporting clarity, investor trust and money earned? | ||||||||||||||||||||||||
| Posted: 18 Feb 2013 03:24 PM PST Consolidated Goldfields Corp. ("Consolidated" or the "Company") (CDGF) announces that as of February 13, 2013, the Company has engaged Gold Seek LLC ("Gold Seek" or "GoldSeek.com") to provide corporate communications and development services to the Company. Gold Seek, located in Littleton, Colorado, will assist the Company in expanding its corporate communications in order to raise awareness among prospective investors and the investment community as a whole. | ||||||||||||||||||||||||
| Posted: 18 Feb 2013 02:33 PM PST
Paul Krugman (PK) and Joe Scarborough (JS) have been having an on-air feud of late. The issue is debt, spending and inflation . The two have been going at each other on their blogs: Here, Here, Here and Here. The bottom line is that PK thinks debt is no problem at all; nothing should be done with spending, and absolutely nothing should be done with America's entitlement programs. JS, sees it differently. He points to the country's $60T of unfunded liabilities, another decade of trillion dollar deficits and the very real chance that high inflation is the outcome.
Atlantic magazine (Egad!) has jumped into this fray with both feet (Link). The folks at Atlantic love PK, and they too see no problems at all. The Mag did its best to take JS down with his silly concerns.
In defense of its position, The Atlantic offered up the following chart on the 10-year TIPS implied forecast for inflation:
The Atlantic had this to say about the market's inflation outlook:
Yes, inflation expectations averaged 2.18%, but the only relevant question is - What are those expectations today?" The TIPS spread is now pricing in 2.56% inflation (15% above the ten-year average) The folks at Atlantic looked at the TIPS info and concluded:
I look at the TIPS chart and come away with a different take than the Atlantic. What I see isn't so "funny". We are approaching the highs for the past decade. The past few years have seen a steady increase in expectations. If you drew a trend line for the past two years, it would point you to an upside breakout for inflation expectations.
What is the main factor pushing up inflation expectations? It's the Fed, of course. The stated policy of Bernanke to increase inflation. The Fed is currently at Full Speed with money creation. There is no end in sight for QE and ZIRP. It's not just the US that is pushing the inflation button. Japan and England have an oar in this water. China is on a tear. I think the EU is not far away from its own QE experiment. Yet the Atlantic concludes the opposite.
The Atlantic should know that it's foolish to Fight the Fed. The Fed is going to win; higher inflation is a sure thing. The TIPS market is the best indication of this. I think it's the Atlantic that could use a lesson on markets and the economy.
| ||||||||||||||||||||||||
| "Bloomberg" Gold Report Misses the Mark Posted: 18 Feb 2013 02:30 PM PST Synopsis: Why Bloomberg's assessment of central bank gold buying is off – and what it means to precious-metals investors. Dear Reader, We read political and economic news reports like any investors does, but we also look for source data ourselves on important subjects. It's fine to let reporters gather information for us, but what we do with that information, and what happens if we trust it blindly, is our own responsibility. There are risks. A case in point is the recent Bloomberg report that Russia has become the world's biggest gold buyer. That may be true according to current official numbers, but official numbers are not always accurate – and in China's case, they have not been updated since 2009. So, BIG GOLD Editor Jeff Clark did a little thinking and research of his own on the subject, coming to a strikingly different conclusion than Bloomberg reached. Now, we like the Bloomberg team, and think they do an above aver... | ||||||||||||||||||||||||
| HYPERINFLATION and SILVER CONFISCATION COMING? – BrotherJohnF & Chris Duane – PT 2 – YouTube Posted: 18 Feb 2013 02:13 PM PST Check our website daily at... [[ This is a content summary only. Visit http://www.figanews.com for full Content ]]  | ||||||||||||||||||||||||
| Robert Wenzel: Get ready for some major disinformation about America's gold Posted: 18 Feb 2013 02:07 PM PST 4p ET Monday, February 18, 2013 Dear Friend of GATA and Gold: Robert Wenzel, editor of Economic Policy Journal, today notes the phoniness and irrelevance of the audit supposedly undertaken recently of gold at the Federal Reserve Bank of New York, reported today by the Los Angeles Times: http://www.gata.org/node/12247 "This audit was designed to confuse," Wenzel writes. "Expect more stories about how the Treasury Department conducted an audit of U.S. gold. Not true. Gold at Fort Knox, where America's gold supposedly sits, is off-limits to all and has never been audited." Wenzel's commentary is headlined "Get Ready for Some Major Disinformation about America's Gold" and it's posted at Economic Policy Journal here: http://www.economicpolicyjournal.com/2013/02/get-ready-for-some-major-di... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT How to profit in the new year with silver -- Future Money Trends is offering a special 16-page silver report with our forecast for 2013 that includes profiles of nine companies and technical analysis of their stock performance. Six of the companies have market capitalizations of less than $800 million and one company has a market cap of only $30 million. The most exciting of these companies will begin production in a few weeks and has a market cap of just $150 million. Half of all proceeds from the sale of this report will be donated to the Gold Anti-Trust Action Committee to support its efforts exposing manipulation and fraud in the gold and silver markets. To learn about this report, please visit: http://www.futuremoneytrends.com/index.php?option=com_content&id=376&tmp... Join GATA here: California Resource Investment Conference * * * Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006: http://www.goldrush21.com/order.html Or by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT GoldMoney adds Singapore vaulting option In addition to its precious metals storage facilities in Hong Kong, Switzerland, Toronto, and the United Kingdom, now with GoldMoney you can store gold and silver in Singapore in a high-security vault operated by Brink's Singapore Pte Limited. To find out more about the new vault, please visit: http://www.goldmoney.com/singapore?gmrefcode=gata GoldMoney customers can take delivery of any number of gold, silver, platinum, and palladium bars from any GoldMoney vault, as well as personally collect their bars stored in the Hong Kong, Switzerland, and U.K. vaults. It's easy to open an account, add funds, and liquidate your investment. For more information, visit: http://www.goldmoney.com/?gmrefcode=gata | ||||||||||||||||||||||||
| Pollution Helping Palladium’s Run? Rohit Savant of CPM Group – YouTube Posted: 18 Feb 2013 02:01 PM PST Check our website daily at... [[ This is a content summary only. Visit http://www.figanews.com for full Content ]]  | ||||||||||||||||||||||||
| Bill Fleckenstein: They've been saying the gold bull is over for 12 years Posted: 18 Feb 2013 01:04 PM PST 3p ET Monday, February 18, 2013 Dear Friend of GATA and Gold: Interviewed today by King World News, fund manager Bill Fleckenstein mocks assertions that gold's bull market is over. ""Don't they say that every day, every week?," Fleckenstein asks rhetorically. "Haven't they said that for 12 years?" He acknowledges that sentiment in the gold sector now is about as terrible as it ever has been but he's betting that the short-term low is in or nearly so and the turnaround will be dramatic. An excerpt from the interview is posted at the King World News blog here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/2/18_Wh... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Fred Goldstein and Tim Murphy open All Pro Gold All-Pro Gold, run by long-time GATA supporters Fred Goldstein and Tim Murphy, offers its services to GATA supporters and anyone else interested in precious metals. The company brokers a full line of precious metals and numismatic coins. It aims to inform prospective clients about the importance of the monetary metals as part of a diversified financial portfolio and to keep prospective clients current with market trends. All-Pro Gold has competitive pricing and ships promptly to clients so they may have physical possession. Learn more by e-mailing Fred@allprogold.com or Tim@allprogold.com or telephone 1-855-377-4653 or visit www.allprogold.com. Join GATA here: California Resource Investment Conference * * * Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006: http://www.goldrush21.com/order.html Or by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Opinion Around the World Is Changing When Deutschebank calls gold "good money" and paper "bad money". ... http://www.gata.org/node/11765 When the president of the German central bank, the Bundesbank, pays tribute to gold as "a timeless classic". ... http://www.forbes.com/sites/ralphbenko/2012/09/24/signs-of-the-gold-stan... When a leading member of the policy committee of the People's Bank of China calls the gold standard "an excellent monetary system". ... http://www.forbes.com/sites/ralphbenko/2012/10/01/signs-of-the-gold-stan... When a CNN reporter writes in The China Post that the "gold commission" plank in the 2012 Republican platform will "reverberate around the world". ... http://www.thegoldstandardnow.org/key-blogs/1563-china-post-the-gop-gold... When the Subcommittee on Domestic Monetary Policy of the U.S. House of Representatives twice called on economist, historian, and gold standard advocate Lewis E. Lehrman to testify. ... World opinion is changing in favor of gold. How can you learn why and what it will mean to you? Read the newly updated and expanded edition of Lehrman's book, "The True Gold Standard." Financial journalist James Grant says of "The True Gold Standard": "If you have ever wondered how the world can get from here to there -- from the chaos of depreciating paper to a convertible currency worthy of our children and our grandchildren -- wonder no more. The answer, brilliantly expounded, is between these covers. America has long needed a modern Alexander Hamilton. In Lewis E. Lehrman she has finally found him." To buy a copy of "The True Gold Standard," please visit: http://www.thegoldstandardnow.com/publications/the-true-gold-standard | ||||||||||||||||||||||||
| Gold at N.Y. Fed is intact, some purer than thought, audit finds Posted: 18 Feb 2013 12:42 PM PST 18-Feb (LATimes) — The U.S. government's gold in New York is safe in a vault underneath Manhattan, and some of the precious metal there is purer than previously thought. That's according to a first-ever audit conducted last year by the Treasury Department of U.S. gold on deposit at Federal Reserve banks in New York and elsewhere. As part of the audit, the Treasury tested a sample of the government's 34,021 gold bars in the New York Fed's vault five stories below Manhattan's financial district, according to the inspector general's office. Auditors drilled tiny holes into the bars to remove samples that were tested for fineness in a process called assaying. In three of the 367 tests, the gold was more pure than Treasury records indicated, according to the Treasury's inspector general. As a result, the government notched up the value of its gold holdings by approximately 27 fine troy ounces – or about $43,500, based on gold's market value Monday. …"Our audit disclosed no material weaknesses and no instances of reportable noncompliance with laws and regulations," the Treasury's audit report said. [source] PG View: So the audit shows the gold is there and the Fed is in compliance, but this story doesn't seem to address whether that gold is encumbered in some way. | ||||||||||||||||||||||||
| What Does a “Troy” Ounce of Gold Mean? What Does 18 or 24 “Karat” Gold Mean? Posted: 18 Feb 2013 12:32 PM PST "Follow the munKNEE" via twitter & Facebook or Register to receive our daily Intelligence Report (Recipients restricted to only 1000 active subscribers) When the price of gold So writes Lorimer Wilson, editor of www.munKNEE.com (Your Key to Making Money) and www.FinancialArticleSummariesToday.com (A site for sore eyes and inquisitive minds). Please note that this paragraph must be included in any article reposting with a link* to the article source to avoid copyright infringement. Wilson goes on to say: Definition of "Karat" The term "karat" (kt) is used to describe the unit of measurement for the proportion of gold (i.e. % purity of the gold content) in a piece of jewellery, coin, ingot or bar as per the table below. Gold will often be mixed with "filler metals" such as silver, palladium, platinum, nickel and even copper to combat the softness of pure 24 karat.
Below is a table outlining the karat designations at various gold purity levels plus the extent of "fineness" as is used in some countries such as Italy.
In some countries "karat" and "carat" are used interchangeably although, strictly speaking, the word's correct meaning is as defined above. All jewellery is required by law to be stamped so consumers will know the quality of gold used. Jewellery (Canadian and British spelling) made in North America is typically marked with the karat grade (10K, 14K, etc.), and jewelry (U.S. spelling) made in Italy is typically marked with the "fineness" such as (417, 583, etc.). Most retail gold items have a karat rating in the range of 9 to 18. In the U.S. the minumum karat value for an item to be sold as gold jewelry is 10. In the UK 9 karat is more common. The number 24 may have originally been chosen to represent pure gold because it divides evenly by 2,3,4,6 8 and 12 and, therefore, it is easy to talk about a gold item being half pure (i.e.12 kt), two-thirds pure (i.e. 16kt) etc. Nine karat would thus be three-eighths gold, 18 karat would be six-eighths (i.e. three quarters). Definition of a "Troy" Ounce The term troy ounce (ozt) is a unit of imperial measure most commonly used to gauge the weight, and therefore the price, of precious metals. One troy ounce is equivalent to 1.09714 avoirdupois (our conventional every day measurement) ounces i.e. a troy ounce is 9.714% greater in weight than the regular measure and 1 kg. consists of 32.1507466 ozt. 100% pure gold is defined as having a purity of 24 karats so if something is 24 karat gold then it's made of gold and nothing else – regardless of size. Gold is a relatively soft metal and high-karat gold tends to be easily damaged and, as such, a 24 karat item is usually reserved for display or ceremonial use as the picture of me with "my" 100kg. Canadian Maple Leaf 99.99999% pure gold coin which is now worth in excess of $5,144,000 USD! (100kg. x 32.1507466 troy oz. x $1,600/ozt. USD)
Conclusion Please keep the distinction between ounces and troy ounces in mind when buying small quantities of gold and/or silver and number of karats when buying gold jewellery.
| ||||||||||||||||||||||||
| Posted: 18 Feb 2013 12:26 PM PST The Gold Report: The major gold producers have ceded market share to gold exchange-traded funds and royalty companies and are vastly underperforming those investment vehicles. If you were running a major gold producer, how would you go about restoring the appeal of your company's shares? David Baker: Mining companies need to restore trust and give more clarity. They are confusing investors because on the one hand they tell us they have so many ounces of gold in reserves and are producing so many ounces of gold, and then they confuse us by benchmarking all this to dollars—a depreciating asset. We believe the mining companies should be consistent and report in gold; this would then give investors a clearer picture on how much gold it is costing to mine the resource and how many ounces of gold are added to the shareholder vault. [INDENT]"Holding gold instead of dollars will also preserve the purchasing power of the company."[/INDENT]There are a number of challenges out there; first is ... | ||||||||||||||||||||||||
| What Will ‘Debt Jubilee’ Look Like? Posted: 18 Feb 2013 12:20 PM PST The economies of the West (with few exceptions) are all hopelessly insolvent. Globally, debt-levels have reached such an extreme, bloated magnitude that outside of the banksters' derivatives casino this is our new "biggest bubble." For reasons which will be made clear shortly; many readers are unaware of the severity of this global debt-crisis. Let's review the facts. Virtually all Western nations are sitting with their highest debt-loads in history, meaning their debt-to-GDP levels are their highest ever – and most are well past the level which constitutes an official "debt crisis." Worse still, all of these debtors have debts which are increasing at a much, much faster rate than economic growth (and this gap continues to increase). In other words, those nations which are already insolvent have no rational hope of ever becoming solvent again; while those nations which are merely "nearly insolvent" have no rational hope of avoiding insolvency. Yet we have this collection of debtors assuring us again and again and again that they are "bailing out" each other. How is this possible? It's not. As an elementary premise of arithmetic/logic; it is impossible for one debtor to ever "bail out" another – directly. In fact there are only two ways in which one debtor may attempt/claim/pretend to be "bailing out" another debtor: a) Borrowing more money one's self, and then giving (i.e. gifting) it to the other debtor b) 'Kiting' a cheque, and then giving that (illusory) "money" to the debtor However, our governments have never claimed/admitted doing either one of those things. Here is what our governments are telling us. They claim to have "bailed out" these insolvent debtors (starting with Greece) by lending them more money. Again, as an elementary premise of arithmetic/logic it is impossible to "bail out" an insolvent debtor by lending that debtor more money. Not only does it make the insolvent debtor even more insolvent; it instantly turns that debt-market into an open Ponzi-scheme. Only ever-increasing quantities of new loans can delay implosion, and the longer the Ponzi-scheme is perpetuated the more damaging/devastating the ultimate collapse must become. The original rebuttal of our governments (and bankers and the media) to such obvious criticism was simple: none of these debtors "would ever default"; such as when Greece's banker – EU "monetary chief" Olli Rehn – told reporters over and over (in 2010) that there was "no possibility" of a Greek default. Obviously these "leaders" were forced to stop making this inane assertion after Greece defaulted on its massive debt. | ||||||||||||||||||||||||
| Audit of gold at New York Fed fails to cover leases and swaps Posted: 18 Feb 2013 12:09 PM PST Multiple claims to the same metal are far more important than any possible imperfections in particular bars. * * * Gold at New York Fed is Intact, Some Purer than Thought, Audit Finds By Andrew Tangel http://www.latimes.com/business/money/la-fi-mo-gold-new-york-fed-audit-p... NEW YORK -- The U.S. government's gold in New York is safe in a vault underneath Manhattan, and some of the precious metal there is purer than previously thought. That's according to a first-ever audit conducted last year by the Treasury Department of U.S. gold on deposit at Federal Reserve banks in New York and elsewhere. As part of the audit, the Treasury tested a sample of the government's 34,021 gold bars in the New York Fed's vault five stories below Manhattan's financial district, according to the inspector general's office. Auditors drilled tiny holes into the bars to remove samples that were tested for fineness in a process called assaying. ... Dispatch continues below ... ADVERTISEMENT Opinion Around the World Is Changing When Deutschebank calls gold "good money" and paper "bad money". ... http://www.gata.org/node/11765 When the president of the German central bank, the Bundesbank, pays tribute to gold as "a timeless classic". ... http://www.forbes.com/sites/ralphbenko/2012/09/24/signs-of-the-gold-stan... When a leading member of the policy committee of the People's Bank of China calls the gold standard "an excellent monetary system". ... http://www.forbes.com/sites/ralphbenko/2012/10/01/signs-of-the-gold-stan... When a CNN reporter writes in The China Post that the "gold commission" plank in the 2012 Republican platform will "reverberate around the world". ... http://www.thegoldstandardnow.org/key-blogs/1563-china-post-the-gop-gold... When the Subcommittee on Domestic Monetary Policy of the U.S. House of Representatives twice called on economist, historian, and gold standard advocate Lewis E. Lehrman to testify. ... World opinion is changing in favor of gold. How can you learn why and what it will mean to you? Read the newly updated and expanded edition of Lehrman's book, "The True Gold Standard." Financial journalist James Grant says of "The True Gold Standard": "If you have ever wondered how the world can get from here to there -- from the chaos of depreciating paper to a convertible currency worthy of our children and our grandchildren -- wonder no more. The answer, brilliantly expounded, is between these covers. America has long needed a modern Alexander Hamilton. In Lewis E. Lehrman she has finally found him." To buy a copy of "The True Gold Standard," please visit: http://www.thegoldstandardnow.com/publications/the-true-gold-standard In three of the 367 tests, the gold was more pure than Treasury records indicated, according to the Treasury's inspector general. As a result, the government notched up the value of its gold holdings by approximately 27 fine troy ounces -- or about $43,500, based on gold's market value Monday. The audit of the Fed gold came after 2012 presidential contender and former U.S. Rep. Ron Paul, R-Texas, questioned the central bank's gold holdings. While he was in Congress, Paul questioned whether the New York Fed had loaned or otherwise encumbered U.S. gold in financial arrangements, and he advanced a bill that would have required a full assay and audit of the country's gold reserves. The assaying process consumed 10 ounces of gold, and the remaining 69 ounces removed for sampling were returned to the Treasury, according to the inspector general's office. The U.S. gold at the New York Fed has been placed under so-called Official Joint Seals, attesting to the results of the audit. "At this point, we do plan to conduct this audit annually," the inspector general's office said in e-mailed responses to questions. "However, since the gold is now under Official Joint Seal, we would not anticipate weighing, counting, and assaying unless the seal shows signs of tampering." Results of the audit were released in January. The audit also examined internal controls, security, and operations at the New York Fed. "Our audit disclosed no material weaknesses and no instances of reportable noncompliance with laws and regulations," the Treasury's audit report said. The New York Fed holds 99.98 percent of the U.S.-owned gold bars and coins in the custody of the Federal Reserve. The rest of the gold is on display at Fed banks in cities such as Richmond, Kansas City, and San Francisco. As of Sept. 30, when the market price of gold was $1,776 an ounce, the Fed banks held $23.9 billion in U.S. gold. (Gold has since declined in value, and on Monday the precious metal was hovering around $1,610 an ounce.) The vast majority of the country's gold reserves is held elsewhere, in Fort Knox, West Point, and Denver. Join GATA here: California Resource Investment Conference * * * Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006: http://www.goldrush21.com/order.html Or by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT Get the real story about the precious metals Now you don't have to travel to attend a financial conference to hear Sprott Asset Management's precious metals experts -- Eric Sprott, Rick Rule, and John Embry. They'll be holding a round-table discussion via the Internet at 2 p.m. ET Tuesday, February 12, and you can be part of it. Among their topics: -- Why are precious metals such a compelling investment opportunity? -- Why are non-G7 central banks buying gold? Do Western central banks have any left? -- Why are investors buying as much silver as gold in dollar terms? What does this mean for the price of silver? -- Is the growing supply deficit of platinum and palladium going to push their prices higher? To register for this Internet conference and participate from the comfort of your own home or office, please visit: http://w.on24.com/r.htm?e=579230&s=1&k=70B829852A33CD255CC2A43ED63D18D0 |
The Treasury Department has released the results of a gold audit on the Treasury's gold holdings stored at the NY Fed which began in 2010. Not surprisingly, the Treasury report claims that the audit found no issues with the quality of the gold held at the NY Fed, or in any policies or procedures by the NY Fed.
| 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