Gold World News Flash |
- Near the Debt Ceiling, No One Can Hear You Scream
- Big Thinkers: Orlov’s Book and Current Events – Part 1
- Gold: The Bull Within the Bear
- NAV Premiums of Certain Precious Metal Trusts and Funds - Claims Per Ounce of Gold at 55
- NAV Premiums of Certain Precious Metal Trusts and Funds - Claims Per Ounce of Gold at 55
- The Reality of Gold and the Nightmare of Paper
- Ted Butler: I Own Silver Because Of The Coming Silver Shortage
- Microsoft Finally Bought Nokia As I Suspected, Now Will They Do The Right Thing?
- Gold & Silver Pullback, Declining Comex Inventories & Syria
- Goldman's Vampire Mobster
- Goldman's Vampire Mobster
- Gold Mining "Doesn't Work" Below $1000
- Gold Mining "Doesn't Work" Below $1000
- South Africa’s gold wage talks sway platinum price
- 7 AMCU members attacked at strike-hit gold mine
- Unpacking India’s new gold import restrictions
- Gold and silver to rise on cheapening currencies
- Gold steady after previous session’s sharp drop
- Gold Price "Targets $1,000"
- Gold Price "Targets $1,000"
- GOLD & SILVER MANIA TO RIVAL HUGE 1980 ADVANCE & MORE
- Gold Slowly Getting Its Shine Back
- The Daily Market Report
- Despite heavy winds, Two Fish re-casts its line for Barrick split
- Gold, silver fall most in 2 months as Putin opposes Syria raid
- The Only Investing Rule That Matters
- Gold falls to new lows on the week as generally encouraging data heighten taper expectations for later this month.
- Gold imported by China from Hong Kong rose in July despite big premiums
- Poland starts expropriating private pension fund assets
- What Can We Infer From Copper and Palladium Charts?
- Gold Imports to China From Hong Kong Climb on Physical Demand
- Gold drops as upbeat U.S. data curbs safe-haven demand
- Gold miners near Chicken cry foul over 'heavy-handed' EPA raids
- Gold miners near Chicken cry foul over 'heavy-handed' EPA raids
- Gold By The Planeload! Precious Metals Update Part II
- Gold Bullion Imports to China Rise, Scrap Sales Surge in India as G20 Splits Over Syria & US Fed Tapering
- Gold better at 1398.00 (+4.51). Silver 23.53 (+0.05). Dollar steady. Euro higher. Stocks called mixed. US 10yr 2.95% (+5 bps).
- The gold graphs you need to see
- U.S. Dollar Clues for Trend Over Next Few Months
- Top 10 Reasons To Buy Gold and Silver
- BREAKING: Silver Miners Lose Half a Billion Dollars
| Near the Debt Ceiling, No One Can Hear You Scream Posted: 05 Sep 2013 11:05 AM PDT Let’s set the stage… Jacob Lew, the Treasury secretary, just whispered that the next market crash begins no later than mid-October. Of course, he didn't say those exact words. But he did report that the Treasury's "extraordinary measures" to avoid hitting the debt ceiling will be "exhausted in the middle of October." The debt ceiling is a legally imposed limit on federal debt. You may remember the 2011 debt ceiling talks and the drama around a government shutdown. This led Standard & Poor's to downgrade the U.S.' credit rating for the first time ever. The market fell more than 15% while all of this was going on from April to August. Well, we're looking at something like that all over again as the government's debt presses up against that ceiling. Even though Lew's whispering those words now, soon he'll begin screaming about it. The budget deficit crisis will likely be front-page news in the month of September as the brinkmanship over the debt ceiling ramps up again. I think we're in for a rough couple of months. It gets worse. There's a second clue that tells us more about the upcoming collapse. As John Williams at ShadowStats points out, the Federal Reserve has bought 110% of the net issuance of U.S. Treasury this year. Meaning the Federal Reserve Bank has bought every new dollar of debt issued and then some. As Williams says, this is "a pace suggestive of a Treasury that is unable to borrow otherwise." By mid-October, the Federal Reserve's purchases should be approaching 140%, by his calculations. This is clearly absurd and can't go on forever. (If for no other reason than the Fed will eventually own the entire federal debt market. As it stands now, it owns about a third of it!) When it ends, interest rates will likely rise. That could also bring the easy-money party to a close. Ironically, right before Labor Day weekend, the government issued its revised GDP numbers. It claims the economy grew at an annual rate of 2.5% for the second quarter. This was a 47% boost from the initial government estimate of 1.7%. Officially, the government is telling us that the economy has now completely recovered from the 2008 crisis. Economic activity is now higher than it was at the 2007 peak. What's most interesting is the contrasting picture of a glowing GDP report with everything else. "No other major economic series has shown a parallel pattern of full economic recovery," Williams points out. "Either the GDP reporting is wrong, or all other major economic series are wrong." There is a lot of nonsense in economic reporting, and GDP is the worst of all. (Williams himself admits that GDP "remains the most worthless and most heavily politicized" of the government series.) But let's look at something that's harder to fudge: median household income. See the chart below.
If you look at that, you don't see any recovery. And these are the government's official numbers. The point is there has been no full recovery. Let's put these clues together. We have another fiscal crisis imminent with a looming debt ceiling drama. We have a Federal Reserve that is already doing a huge and unsustainable amount of "stimulus" buying. And we have an economy far weaker than it's been in more than a decade despite the bluster over GDP. The bigger concern is that the market doesn't have any of this priced in at all. It's true that August was the worst month for stocks since May 2012. Yet the market fell just 3.1% and is only 4.5% off its all-time high. That's barely a scratch. What's odd is that the stock market has pushed higher this year — putting in a new all-time high on Aug. 2 — even though earnings growth has clearly slowed. Earnings growth for the S&P 500, a broad proxy for the market, was up just 2% for the second quarter. That was all due to the financials (banks, insurers). If you take them out, earnings actually fell 3%. Analysts have been adjusting their estimates. Earnings growth for the third quarter is now just 3.7%, versus 6.5% at the start of the quarter — a 43% correction! Slowing profit growth and rising market mean valuations have climbed. Bloomberg reports that "Valuations last climbed this fast in the final year of the 1990s technology bubble, just before the index began a 49% tumble." I don't think we have that big of a decline ahead of us, simply because we're starting at a much lower valuation. In 1999, the market went for 30 times earnings. Today, it goes 18 times earnings. That's still a high number, reflective of too much optimism about future growth. Most still see earnings and the economy growing briskly in the back half of the year. Barron's recently polled 10 of the most influential Wall Street seers. They project 8% earnings growth in the second half! When it becomes obvious that is a fairy tale, the market is going to be in for a shock. Keep your powder dry and your portfolio small. After reading the above, you might be tempted to sell everything and wait for the storm to blow over. I don't think you should. First off, we have to realize that all of the above analysis could prove way off. Maybe Congress raises the debt ceiling without a hitch, buying more time. Maybe the Fed pulls some new rabbit out of its hat, buying yet more time. Besides, guessing at what the market is going to do is just that — guessing. Humility before an unknowable future is the first step toward any sensible investing strategy. The only thing we can really do is to decide what risks to take. Second, while I think now is a time to be cautious — simply due to the relative scarcity of cheap stocks — I don't think you should let market worries put you off a solid long-term investment plan. As Marty Whitman once said, "You make more money sitting on your ass." In other words, you're often better off doing nothing and holding onto good companies growing their net asset values over time, rather than trying to play market timer. So we will continue to invest in what cheap plays we find. Regards, Chris Mayer P.S. That said, I do have a few cheap plays in mind. You might know them as part of the "Chaffee Royalty Program." Back in 2002, every $1 invested in this program was safely turned into $50. It was an investor’s dream come true. And in today’s Daily Reckoning email edition, I give readers a chance to get in on it. Not a Daily Reckoning subscriber? Sign up for free, right here. | ||||||||
| Big Thinkers: Orlov’s Book and Current Events – Part 1 Posted: 05 Sep 2013 11:00 AM PDT by California Lawyer, TF Metals Report:
The Sky is Falling! Or is it? Dmitry Orlov's 2013 book "The Five Stages of Collapse – Survivors' Toolkit" is required reading. I do not say that lightly. It is a must read; do not delay. It is here: and there are reviews posted for those inclined. I am not doing a book review. I am trying to pin down a realistic time-line, and the markers of same, in order that we all can prepare accordingly. Nothing I have read to date is as well analyzed, or presented, so for that, I am in awe. But, naturally, I have my own thoughts as to the reality that all five stages of collapse actually occur. So, this is Part I. Part II will be next Wednesday, as it all should make more sense as the Syrian situation unfolds. | ||||||||
| Gold: The Bull Within the Bear Posted: 05 Sep 2013 11:00 AM PDT This is a contribution from Hard Assets Alliance. They offer a special SmartMetals Action Kit for free. Gold investors will recall there was a surge in bullion buying when the price crashed in mid-April. We saw less of this with the June decline, though global investment demand has still been stronger than what was seen in 2012. What virtually every mainstream headline has been screaming about, though, is the huge outflows in GLD. This frustrates someone like me who knows the “paper” gold market comprises only a part of the total investment picture for gold. As the saying goes, they’re looking at only one part of the elephant. The reason it’s important to look at the entire picture of investment demand is because an investor might draw an erroneous conclusion if they read just the headlines. For example, China and other Asian nations represent well over half of all global investment demand, while North America is just 9%. Is this bigger source of demand experiencing a lot of selling, too? Let’s look at the bigger picture of investment demand for gold this year. In the following chart, we compare GLD outflows to Chinese imports through Hong Kong, as well as other sources of demand for physical metal. Here are the data through last month.
As is clearly visible, Chinese gold imports alone are much greater than what GLD holders have sold. It’s not even a fair comparison, because Hong Kong import data are currently available only through May, while GLD sales are through June. And when combining imports with the country’s production—remember, China doesn’t export any metal—it’s roughly double GLD outflows. This is just the Chinese market… adding in central bank purchases and the numbers from the US and Perth Mints, along with Japanese imports, pushes the total over 150% higher than GLD liquidations. But the difference is more dramatic than this. The data also exclude…
To be fair, the chart also excludes ounces sold by other gold-backed ETFs (they have not reported their Q2 data as of this writing), though their holdings are a small fraction of GLD. I’ll also point out that CPM Group, a metals consultancy, cautions that some of the Chinese import data may not relate to investment or fabrication demand, and that some metal likely ends up in Thailand, Philippines, Malaysia, and other regional countries, though in that case it’s still part of demand. Even if we subtract a portion of those ounces, though, the net result is the same: the global demand for physical metal wildly exceeds GLD sales. This more complete view of investment demand sends a clear message to investors: the gold bull market is not over. Here’s why: A bullish response to the correction. Stampeding to buy an asset that’s crashing in price is not the kind of behavior associated with a trend that is over—just the opposite, in fact. Clearly, most bullion investors around the world see the corrections in gold as a sale, including China and other Asian nations. Long-term buyers vs. short-term sellers. Someone who buys a paper form of gold typically has a short-term time horizon in mind. What have many of them been doing? Selling. The investor who buys actual physical metal, meanwhile, tends to have a longer-term time frame. And what are they doing? Buying. Lack of physical selling. It’s not just the tremendous amount of buying that’s taking place; it’s still very difficult to find any significant amount of selling by holders of physical metal. This adds strength to what we’re seeing from long-term investors. Don’t be fooled by what happened in the futures market. The retreat in the gold price is a buying opportunity for physical metal. And those who do so will be in strong company. The bottom line for me can be summed up by Zhang Bingnan, secretary-general of the China Gold Association: “The dumping recently of holdings in gold exchange-traded products by overseas investors may not prove to be a wise move.” Indeed. Let’s follow the bull within the bear and take advantage of the current sale.
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| NAV Premiums of Certain Precious Metal Trusts and Funds - Claims Per Ounce of Gold at 55 Posted: 05 Sep 2013 10:49 AM PDT | ||||||||
| NAV Premiums of Certain Precious Metal Trusts and Funds - Claims Per Ounce of Gold at 55 Posted: 05 Sep 2013 10:49 AM PDT | ||||||||
| The Reality of Gold and the Nightmare of Paper Posted: 05 Sep 2013 09:53 AM PDT from Deviant Investor:
Since Nixon "temporarily closed the gold window" in 1971 all currencies have been created as debt, not as asset backed real money, like a gold Double Eagle.
The value of the debt backed paper is supposedly based on the face value, yield, duration, and the probability of repayment. Examples: If I lend my (hypothetical) broke, unemployed, and irresponsible friend $1,000 on an unsecured note, and he is unlikely to repay the loan, then the loan has a value of approximately zero. | ||||||||
| Ted Butler: I Own Silver Because Of The Coming Silver Shortage Posted: 05 Sep 2013 09:45 AM PDT By Ted Butler, Gold Silver Worlds:
While I can understand these reasons and don't have any real dispute that they may prove to provide the protection desired; all are far removed from the reason I hold and continue to buy silver. I own silver because I feel it will perform better than any other investment I am aware of, including gold. | ||||||||
| Microsoft Finally Bought Nokia As I Suspected, Now Will They Do The Right Thing? Posted: 05 Sep 2013 09:44 AM PDT On Tuesday, 15 February 2011 I penned The Nokia/Microsoft Alliance & Android's Commoditization Of The Mobile Computing Platform... In said missive, I apparently foretold the future, to wit: The Nokia/Microsoft Marriage via Force of Android team up is definitely a plus for Nokia despite the appearance that Microsoft ex-management is moving heavily into company. Nokia probably makes some of the best hardware around, but there OS game has been lacking for some time. The only real unaddressed issue is that Elop never addressed the real reason why he didn't adopt Android, and the MSFT alliance doesn't address it either. Reference this quote from Endgadget: Nokia did talk with Google about adopting Android but decided that it "would have difficulty differentiating within that ecosystem" and the "commoditization risk was very high -- prices, profits, everything being pushed down, value being moved out to Google which was concerning to us." Microsoft presented the best option for Nokia to resume the fight in the high end smarpthone segment." Elop goes further, recognizing what I have been saying for about a year now, and that isGoogle/Android is at the forefront of the mobile computing wars - Nokia: 'Our first priority is beating Android. Again, I query, how is Elop going to do that if he is afraid to commoditize the platform though. Android is commoditizing the whole smartphone space, not just the low end. If anything, the pressure on the high end is heavier. Look at the Evo and Samsung Galaxy series phones and how they are so much more capable than the iPhone for the same price. Then you have the next gen of phones available next month, ex. the Atrix and LG 1080p, 3D, dual core and quad core phones. If you haven't seen this tech, I strongly suggest you read Apple Gears Up To Combat The Margin Compression That Apparently Only It, Google & Reggie Middleton Sees Coming, it's impressive. This tech is moving lightning fast and the price points aren't budging, although the margins are collapsing in this fast moving space.
As you can see, it was easy to see HTC margins collapsing 3 years ago while it was actually in its heyday. HTC is not the only one either. Samsung and Apple are suffering the same fate, simply reference Have We Reached "Peak Premium Smartphone"? How is Elop going to address this by using Windows OS? He has to do more than just charge more, he has to produce better product at competitive prices, which keep getting lower. Elop will have to license the Widows OS, which is an expense, one that he would bear to nearly the same extent if he used Android. I feel he mistakenly looks at this as Google commoditizing the Android platform, in lieu of the more reasonable perspective of Google commoditizing the entire portable computer space. They can do this because they benefit regardless, as long as the masses are moved to the cloud. See
Long story short, the only company that is positioned to come out on top of this hardware battle is Google, at least thus far. But that begs the question, what if one of the other big boys catches on? On Thursday, 25 October 2012 I penned Microsoft Is Doing What The "Has Been Giants Of Yesteryear" Were Afraid To Do, Make A Radical Change BEFORE ITS TOO LATE!, to wit:
You see, although Microsoft doesn't get much mobile respect these days (and for good reason), their Windows mobile platform is quite capable. After securing the full purchase of Nokia's handset business and licensing of its patents, MSFT is actually well positioned to do some damage in the space if it truly has the balls to do what it takes. Before I go on, let's take a look at the weapon of choice that I would use... Review: Stellar camera makes Nokia Lumia 1020 first Windows phone worth lovingIn less than a month, the Lumia 1020 has become this reviewer's go-to smartphone for taking shots of everything from family to friends to practices.BY EBENEZER SAMUEL / NEW YORK DAILY NEWS | ||||||||
| Posted: 05 Sep 2013 09:29 AM PDT Yes, the squid is a gangster too. Just look at the insurance job on AIG in 2008... YOU KNOW the routine, writes Chris Mayer in The Daily Reckoning. Mobsters shake down, say, a restaurant owner. They drink all the booze and eat all they want and pay nothing. They rob the cash register. They even go out and borrow money against the place and spend it. When they've finally bled the thing dry and the business is about to collapse, they burn the place down and collect the insurance money. That's pretty much what Goldman Sachs did to AIG. The taxpayer footed the bill. We are fast approaching the fifth anniversary of the day the US government stepped in to bail out AIG, the insurance giant. It happened over the weekend of September 14, 2008. And even though I feel like I know the story, I keep learning new wrinkles about the whole debacle. It really was a mob job on the US taxpayer - and just one of many during that whole crisis. I'll explain and show how this is still going on... I was in Pompano Beach, Fla., this week with the family, visiting my 91-year-old grandmother. And I picked up a copy of Matt Taibbi's Griftopia: A Story of Bankers, Politicians and the Most Audacious Power Grab in American History. It's great beach reading. Taibbi is a Rolling Stone correspondent and wrote the now immortal description of Goldman Sachs as a "vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money." Hunter S.Thompson, probably the greatest writer ever to write for Rolling Stone, would be proud. Taibbi is a worthy heir. The book, published in 2010, is mostly a collection of pieces that appeared in Rolling Stone from 2008-2010 reworked and updated with new material. Taibbi has style, and I like his prose. He has a gift with metaphor and simile. Taibbi calls the crazy tactics of one hedge fund "the financial equivalent of performing open-heart surgery with unwashed hands, using a Super 8 motel bedspread as an operating table." Taibbi says Bernanke's claim that a weak Dollar only really affects Americans going abroad "is a bit like saying a forest fire only really sucks if you're a woodpecker." Some people are turned off by his style, which involves occasional profanity. (His chapter on former Fed chief Alan Greenspan is titled 'The Biggest Asshole in the Universe'.) But I like it because it has the effect of unmasking these criminals so we can see them for what they really are. Most of the government officials and corporate bigwigs under analysis are just high-class thieves. Besides that, Taibbi does a lot of terrific investigative reporting. He's more than a stylist. And I think his perspective is spot on. He fully appreciates that what we live in is an economy that is fast becoming a Kafkaesque nightmare. Here is Taibbi:
For most people, a run-in with government officialdom is something to be avoided. It means you are in for a costly experience, if not outright financial ruin – even when you've done nothing wrong. But then there is what Taibbi calls the grifter class. These people use the government as a way of making money. This is a large and sweeping cast that includes people at the top of the financial/power pyramid - such as the senators, representatives and upper-level officialdom and the sharks at gangster firms like Goldman Sachs, Morgan Stanley, JP Morgan and the like. But it also includes lowlife crooks snookering everyday folks, bribing people, falsifying appraisals and generally acting like scum. More from Taibbi:
If you can play the game, you can make a lot of money and take almost no risk. The taxpayer will pick up the tab. One example Taibbi spends a good bit of time on is the whole housing bubble. I enjoyed reading some of the craziness of that era. The home in Fort Myers, Fla., that sold for $399,600 on Dec. 29, 2005, sold again the next day for $589,900 and was in foreclosure a month later. Or the $615,000 house sold to a glasscutter where the mortgage was 96% of his take-home pay. And then the Wall Street magic that turned this huge pile of mortgage garbage into AAA-rated securities. Taibbi details the inner workings of it all in an accessible and fascinating way. He describes it as a "financial sewage system designed to stick us all with the raw waste and pump clean water back to Wall Street." The amount of fraud and greed and thievery involved by all parties is still breathtaking to read about, even though I lived through it. And this brings us to AIG. The chapter on this episode is called 'Hot Potato'. In a sense, AIG was the firm that got stuck with the hot potato. It is a riveting story, actually, and I can't do justice to it here. But it encapsulates the mafia-style economy we find ourselves in. Essentially, at the end of the tale, AIG owed Goldman Sachs tens of billions of Dollars. AIG couldn't pay it. So...well, here's Taibbi describing the showdown:
And they got it. Now, you might claim the taxpayer made money on the deal, as was widely been reported late last year. The idea is ridiculous, because AIG was clearly a heist in which AIG had no choice and the price offered was a fire sale price. (Not that we should feel sorry for AIG, which was a gangster firm with its own crooks.) Besides, where is the check for the taxpayer? I never got it. The truth is the government used our money for free and taxpayers will never see it. The whole perspective this book offers is important. Because if you think of the economy as this vast thing where success or failure is a matter of serving customers well, then you are deceiving yourself. (I've written about this before, about how America's largest companies are basically products of state privilege.) This perspective is good too because the reality of the thing shatters many illusions. Think Obamacare is a socialist redistribution scheme? Take another look. What it really amounts to is the largest corporate giveaway and pork-filled legislation in the history of the country. Taibbi's book also pops a lot of inflated reputations, like Warren Buffett's. My view of Warren Buffett as a person has basically plummeted in the last half-decade or so. Buffett and his firm Berkshire Hathaway benefited immensely from government bailout money. Wells Fargo, of which Buffett is a major shareholder, got $50 billion in bailout money. In fact, many Berkshire holdings were direct beneficiaries of bailout money. And Buffett himself used his influence to make sweetheart deals with the government. It makes you want to throw up, then, when Buffett's vice chairman, Charlie Munger, said of struggling Americans during the housing bust that they should "suck it in and cope." Yeah. Buffett lobbied hard for taxpayer bailouts. He is, today, just another grifter – like Goldman Sachs – using taxpayer money and his influence over those in power to enrich himself and his corrupt firm. (As an aside, the hero worship around Buffett is sickening and sophomoric and really should end. Buffett was a great investor, perhaps the greatest that ever lived. But that doesn't make him a good person, or a wise person, or even a great investor today. I know he's giving his money to charity. Maybe he should start by giving it back to the people he stole it from.) Honore de Balzac, the French novelist, once said that behind every great fortune there is a crime. Sadly, in the US, this is more and more often the case. By the way, Taibbi's latest Rolling Stone piece is called 'Ripping off Young America: The College Loan Scandal'. It shows again the same grifter dynamics at work. Anyway, Griftopia is a great book. I enjoyed it immensely and recommend it to anyone who wants to get a better understanding about how things work. | ||||||||
| Posted: 05 Sep 2013 09:29 AM PDT Yes, the squid is a gangster too. Just look at the insurance job on AIG in 2008... YOU KNOW the routine, writes Chris Mayer in The Daily Reckoning. Mobsters shake down, say, a restaurant owner. They drink all the booze and eat all they want and pay nothing. They rob the cash register. They even go out and borrow money against the place and spend it. When they've finally bled the thing dry and the business is about to collapse, they burn the place down and collect the insurance money. That's pretty much what Goldman Sachs did to AIG. The taxpayer footed the bill. We are fast approaching the fifth anniversary of the day the US government stepped in to bail out AIG, the insurance giant. It happened over the weekend of September 14, 2008. And even though I feel like I know the story, I keep learning new wrinkles about the whole debacle. It really was a mob job on the US taxpayer - and just one of many during that whole crisis. I'll explain and show how this is still going on... I was in Pompano Beach, Fla., this week with the family, visiting my 91-year-old grandmother. And I picked up a copy of Matt Taibbi's Griftopia: A Story of Bankers, Politicians and the Most Audacious Power Grab in American History. It's great beach reading. Taibbi is a Rolling Stone correspondent and wrote the now immortal description of Goldman Sachs as a "vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money." Hunter S.Thompson, probably the greatest writer ever to write for Rolling Stone, would be proud. Taibbi is a worthy heir. The book, published in 2010, is mostly a collection of pieces that appeared in Rolling Stone from 2008-2010 reworked and updated with new material. Taibbi has style, and I like his prose. He has a gift with metaphor and simile. Taibbi calls the crazy tactics of one hedge fund "the financial equivalent of performing open-heart surgery with unwashed hands, using a Super 8 motel bedspread as an operating table." Taibbi says Bernanke's claim that a weak Dollar only really affects Americans going abroad "is a bit like saying a forest fire only really sucks if you're a woodpecker." Some people are turned off by his style, which involves occasional profanity. (His chapter on former Fed chief Alan Greenspan is titled 'The Biggest Asshole in the Universe'.) But I like it because it has the effect of unmasking these criminals so we can see them for what they really are. Most of the government officials and corporate bigwigs under analysis are just high-class thieves. Besides that, Taibbi does a lot of terrific investigative reporting. He's more than a stylist. And I think his perspective is spot on. He fully appreciates that what we live in is an economy that is fast becoming a Kafkaesque nightmare. Here is Taibbi:
For most people, a run-in with government officialdom is something to be avoided. It means you are in for a costly experience, if not outright financial ruin – even when you've done nothing wrong. But then there is what Taibbi calls the grifter class. These people use the government as a way of making money. This is a large and sweeping cast that includes people at the top of the financial/power pyramid - such as the senators, representatives and upper-level officialdom and the sharks at gangster firms like Goldman Sachs, Morgan Stanley, JP Morgan and the like. But it also includes lowlife crooks snookering everyday folks, bribing people, falsifying appraisals and generally acting like scum. More from Taibbi:
If you can play the game, you can make a lot of money and take almost no risk. The taxpayer will pick up the tab. One example Taibbi spends a good bit of time on is the whole housing bubble. I enjoyed reading some of the craziness of that era. The home in Fort Myers, Fla., that sold for $399,600 on Dec. 29, 2005, sold again the next day for $589,900 and was in foreclosure a month later. Or the $615,000 house sold to a glasscutter where the mortgage was 96% of his take-home pay. And then the Wall Street magic that turned this huge pile of mortgage garbage into AAA-rated securities. Taibbi details the inner workings of it all in an accessible and fascinating way. He describes it as a "financial sewage system designed to stick us all with the raw waste and pump clean water back to Wall Street." The amount of fraud and greed and thievery involved by all parties is still breathtaking to read about, even though I lived through it. And this brings us to AIG. The chapter on this episode is called 'Hot Potato'. In a sense, AIG was the firm that got stuck with the hot potato. It is a riveting story, actually, and I can't do justice to it here. But it encapsulates the mafia-style economy we find ourselves in. Essentially, at the end of the tale, AIG owed Goldman Sachs tens of billions of Dollars. AIG couldn't pay it. So...well, here's Taibbi describing the showdown:
And they got it. Now, you might claim the taxpayer made money on the deal, as was widely been reported late last year. The idea is ridiculous, because AIG was clearly a heist in which AIG had no choice and the price offered was a fire sale price. (Not that we should feel sorry for AIG, which was a gangster firm with its own crooks.) Besides, where is the check for the taxpayer? I never got it. The truth is the government used our money for free and taxpayers will never see it. The whole perspective this book offers is important. Because if you think of the economy as this vast thing where success or failure is a matter of serving customers well, then you are deceiving yourself. (I've written about this before, about how America's largest companies are basically products of state privilege.) This perspective is good too because the reality of the thing shatters many illusions. Think Obamacare is a socialist redistribution scheme? Take another look. What it really amounts to is the largest corporate giveaway and pork-filled legislation in the history of the country. Taibbi's book also pops a lot of inflated reputations, like Warren Buffett's. My view of Warren Buffett as a person has basically plummeted in the last half-decade or so. Buffett and his firm Berkshire Hathaway benefited immensely from government bailout money. Wells Fargo, of which Buffett is a major shareholder, got $50 billion in bailout money. In fact, many Berkshire holdings were direct beneficiaries of bailout money. And Buffett himself used his influence to make sweetheart deals with the government. It makes you want to throw up, then, when Buffett's vice chairman, Charlie Munger, said of struggling Americans during the housing bust that they should "suck it in and cope." Yeah. Buffett lobbied hard for taxpayer bailouts. He is, today, just another grifter – like Goldman Sachs – using taxpayer money and his influence over those in power to enrich himself and his corrupt firm. (As an aside, the hero worship around Buffett is sickening and sophomoric and really should end. Buffett was a great investor, perhaps the greatest that ever lived. But that doesn't make him a good person, or a wise person, or even a great investor today. I know he's giving his money to charity. Maybe he should start by giving it back to the people he stole it from.) Honore de Balzac, the French novelist, once said that behind every great fortune there is a crime. Sadly, in the US, this is more and more often the case. By the way, Taibbi's latest Rolling Stone piece is called 'Ripping off Young America: The College Loan Scandal'. It shows again the same grifter dynamics at work. Anyway, Griftopia is a great book. I enjoyed it immensely and recommend it to anyone who wants to get a better understanding about how things work. | ||||||||
| Gold Mining "Doesn't Work" Below $1000 Posted: 05 Sep 2013 09:26 AM PDT Which miners thrive and which die if the gold price falls again...? BARRY ALLAN has worked in the mining sector for over 30 years, serving as a gold and precious metals mining analyst with Gordon Capital, BZW and Prudential Bache, joining Mackie Research's investment banking department in 1998 as a mining specialist and transferring to the research department as a mining analyst in 2001. Holding a Bachelor of Science degree in geology and a Master of Business Administration from Dalhousie University, Barry Allan recently crunched the data to stress test which junior gold miners would thrive, survive or die at $1000 per ounce gold. His team did the same for junior silver miners with the metal priced at $18 per ounce. And here, in this interview with The Gold Report, Barry Allan – now director and vice chairman of Mackie's mining group – offers hope that the gold and silver miner sector, instead of going to hell in a handbasket, actually is rebounding... The Gold Report: We last talked in April 2012. What has happened in the junior gold and silver mining market since then and where is it headed? Barry Allan: Defining junior mining as single-mine producers and exploration companies, the sector has been decimated over the last 12 to 18 months. We're still in a period of skepticism and suppressed valuations. That will continue for the balance of 2013 and perhaps into 2014. However, in spite of this general malaise, the entire sector isn't going to hell in a handbasket. Good companies can still conduct business, raise money and advance their projects. We suspect that in 2014 the market will be a bit more palatable, but not offer a dramatic shift. TGR: In 1999, you watched the gold price hit a low of $252.80 per ounce and until 2004, struggle to rise above $300 per ounce. How is today's market for precious metals equities different? Barry Allan: The protracted bear market that led to the bottom of the gold price was a steady grind down from the end of 1997. That is not the case now. We remain in a bear market, but the price drop has been rather moderate. That is not a very bad gold price environment compared to where we were back then. There's more optimism, in that gold – the amount of bullion held in exchange-traded funds (ETFs) – remains at a very good level. Bullion has reasserted itself as a legitimate asset class. TGR: The Federal Open Market Committee meeting showed strong support for tapering quantitative easing due to an improving US economy. Can a steadily growing US economy and a rising gold price coexist? Barry Allan: It should be entirely possible. One of the big concerns about the future of the bullion price has been what happens in the event of sharply higher interest rates in the US We expect bullion to show better resilience in this environment because of the emergence of other world economies – China being the primary example, but also India – that have stated the importance of bullion to their currency holdings. I anticipate that while a higher US interest rate and a stronger Dollar will have an impact, it won't be of the magnitude that it would have been 10 years ago. TGR: What will be the key price drivers for gold over the next 12 months? Barry Allan: In North America, real interest rates and the performance of the Dollar will be the drivers. But the caveat is how the China sovereign entities respond. Their stated goal is to diversify out of currencies and into bullion. If we see this transition of money out of gold ETFs, it is likely to move into the hands of the world's sovereign funds to diversify their currency risks. As a result, we anticipate a more balanced market overall. TGR: And silver? Barry Allan: When you correlate silver with gold, you get an R-square of 0.94 over the very long term. Short term, the only thing you can say about silver is that it sometimes lags or overreacts to the gold price. Fundamentally, if you're positive on gold, you should be positive on silver in the short term. By short term, I mean up to six or nine months. TGR: Will silver's run carry into the fall? Barry Allan: Most probably, yes. If history repeats itself, as it often does, silver will lag and then overreact. Silver is like a sign-wave around the long-term gold price, but overall the two are very closely aligned. I fully anticipate silver will overreact, then come into line. TGR: Intierra Raw Metals Group reported that only $2.28 billion in mining finance was received in Q2/13 compared with $6.12bn in Q2/12. Another $5.16bn was raised in Q1/13. How is Q3/13 shaping up? Barry Allan: The gold price has shown some life; the equities have shown more life than commodities. We fully anticipate that Q4/13 will be better than Q3/13. The current quarter will be consistent with Q2/13. Getting into Q1/14, we anticipate another uptick. TGR: If you weren't optimistic about the fall and 2014, would you be doing this interview at all? Barry Allan: Probably not. We've done our analysis and we see some light in bullion. The gold industry doesn't work at a $1000 per ounce gold price. In 2000, the industry didn't work in a below-$275 per ounce gold price environment. In the shorter term, this is a period of seasonal strength, and the gold price is following a very consistent, seasonal pattern. Through to Q1/14 we have at least a short-term trade in a market that has been otherwise negative. In the longer term, we are pretty comfortable that we will not be in a sub-$1000 per ounce gold price environment. TGR: Yet you and your team at Mackie have published a no-nonsense report, evaluating precious metals companies using $1000 per ounce gold and $18 per ounce silver. The report put companies into three categories: Thrive, Survive and Die. What sort of response has the report generated? Barry Allan: We did the report as a direct response to the investment community. Everyone was concerned about which companies could survive a sharp downturn in the bullion price. We wanted to be succinct, hence the rather dramatic categories and the title, "Thrive, Survive or Die." We've heard from a number of third-party information distributors, such as Bloomberg, that the report had the highest readership for the week in which it was released. Our own website shows that to be the case. From the investment side, it was well received. People on the company side were very mindful of what we were saying. We received direct responses from each company in the Survive and the Die categories, recognizing our comments and addressing the issues, explaining what they are doing in response to the questions that the report posed. The companies were reasonably open in recognizing that they have issues and are addressing them. TGR: It must be nice to be relevant in the conversation. Barry Allan: No doubt about it. The renewed interest in the investment community compared to 12 months ago is gratifying. Average investors are severely underweight in gold stocks. They're very sensitive about it; they recognize that gold equities have come off a bottom, and they're concerned about being underweight. TGR: Let's get to some of those companies starting with the Thrivers. It's a short list. Barry Allan: It is a short list, and the macro point to be taken from its brevity is that the industry can't stay intact at $1000 per ounce gold and $18 per ounce silver. The industry will need to restructure to be functional in the longer term. The companies categorized as Thrives will stay intact. Their balance sheets are comparatively strong. They have mines that work at lower commodity prices. They can generate positive free cash flow even after capital expenditures, which means they won't have to shut down mines or defer development expenditures. TGR: What characterizes a company in your Survivor category? Barry Allan: The Survivors are companies that will need to make material changes to endure at a $1000 per ounce gold price. That means some hard choices: restructuring the balance sheet, deferring or cancelling development projects and/or closing existing mines that contribute to the production profile. TGR: Aside from Thrivers, Survivors and the Dead, do you have any wisdom for gold investors looking for a few rays of hope? Barry Allan: The rays of hope are already evident in the marketplace. While it feels like a bear market in gold and gold equities, it's not. It is has been a fairly aggressive correction, but it's not the doom-and-gloom type of bear market of the past. The market has accepted physical bullion as a legitimate asset class. While there are some "challenging" gold equities, others have conducted their business well and are in good shape. Longer term, we will need to see bullion show a positive investment environment in a higher interest rate environment and a higher Dollar environment, but that's a fight we'll take on late next year. For now, we are happy to enjoy seasonal strength. TGR: Barry, thanks for your time and your insights. | ||||||||
| Gold Mining "Doesn't Work" Below $1000 Posted: 05 Sep 2013 09:26 AM PDT Which miners thrive and which die if the gold price falls again...? BARRY ALLAN has worked in the mining sector for over 30 years, serving as a gold and precious metals mining analyst with Gordon Capital, BZW and Prudential Bache, joining Mackie Research's investment banking department in 1998 as a mining specialist and transferring to the research department as a mining analyst in 2001. Holding a Bachelor of Science degree in geology and a Master of Business Administration from Dalhousie University, Barry Allan recently crunched the data to stress test which junior gold miners would thrive, survive or die at $1000 per ounce gold. His team did the same for junior silver miners with the metal priced at $18 per ounce. And here, in this interview with The Gold Report, Barry Allan – now director and vice chairman of Mackie's mining group – offers hope that the gold and silver miner sector, instead of going to hell in a handbasket, actually is rebounding... The Gold Report: We last talked in April 2012. What has happened in the junior gold and silver mining market since then and where is it headed? Barry Allan: Defining junior mining as single-mine producers and exploration companies, the sector has been decimated over the last 12 to 18 months. We're still in a period of skepticism and suppressed valuations. That will continue for the balance of 2013 and perhaps into 2014. However, in spite of this general malaise, the entire sector isn't going to hell in a handbasket. Good companies can still conduct business, raise money and advance their projects. We suspect that in 2014 the market will be a bit more palatable, but not offer a dramatic shift. TGR: In 1999, you watched the gold price hit a low of $252.80 per ounce and until 2004, struggle to rise above $300 per ounce. How is today's market for precious metals equities different? Barry Allan: The protracted bear market that led to the bottom of the gold price was a steady grind down from the end of 1997. That is not the case now. We remain in a bear market, but the price drop has been rather moderate. That is not a very bad gold price environment compared to where we were back then. There's more optimism, in that gold – the amount of bullion held in exchange-traded funds (ETFs) – remains at a very good level. Bullion has reasserted itself as a legitimate asset class. TGR: The Federal Open Market Committee meeting showed strong support for tapering quantitative easing due to an improving US economy. Can a steadily growing US economy and a rising gold price coexist? Barry Allan: It should be entirely possible. One of the big concerns about the future of the bullion price has been what happens in the event of sharply higher interest rates in the US We expect bullion to show better resilience in this environment because of the emergence of other world economies – China being the primary example, but also India – that have stated the importance of bullion to their currency holdings. I anticipate that while a higher US interest rate and a stronger Dollar will have an impact, it won't be of the magnitude that it would have been 10 years ago. TGR: What will be the key price drivers for gold over the next 12 months? Barry Allan: In North America, real interest rates and the performance of the Dollar will be the drivers. But the caveat is how the China sovereign entities respond. Their stated goal is to diversify out of currencies and into bullion. If we see this transition of money out of gold ETFs, it is likely to move into the hands of the world's sovereign funds to diversify their currency risks. As a result, we anticipate a more balanced market overall. TGR: And silver? Barry Allan: When you correlate silver with gold, you get an R-square of 0.94 over the very long term. Short term, the only thing you can say about silver is that it sometimes lags or overreacts to the gold price. Fundamentally, if you're positive on gold, you should be positive on silver in the short term. By short term, I mean up to six or nine months. TGR: Will silver's run carry into the fall? Barry Allan: Most probably, yes. If history repeats itself, as it often does, silver will lag and then overreact. Silver is like a sign-wave around the long-term gold price, but overall the two are very closely aligned. I fully anticipate silver will overreact, then come into line. TGR: Intierra Raw Metals Group reported that only $2.28 billion in mining finance was received in Q2/13 compared with $6.12bn in Q2/12. Another $5.16bn was raised in Q1/13. How is Q3/13 shaping up? Barry Allan: The gold price has shown some life; the equities have shown more life than commodities. We fully anticipate that Q4/13 will be better than Q3/13. The current quarter will be consistent with Q2/13. Getting into Q1/14, we anticipate another uptick. TGR: If you weren't optimistic about the fall and 2014, would you be doing this interview at all? Barry Allan: Probably not. We've done our analysis and we see some light in bullion. The gold industry doesn't work at a $1000 per ounce gold price. In 2000, the industry didn't work in a below-$275 per ounce gold price environment. In the shorter term, this is a period of seasonal strength, and the gold price is following a very consistent, seasonal pattern. Through to Q1/14 we have at least a short-term trade in a market that has been otherwise negative. In the longer term, we are pretty comfortable that we will not be in a sub-$1000 per ounce gold price environment. TGR: Yet you and your team at Mackie have published a no-nonsense report, evaluating precious metals companies using $1000 per ounce gold and $18 per ounce silver. The report put companies into three categories: Thrive, Survive and Die. What sort of response has the report generated? Barry Allan: We did the report as a direct response to the investment community. Everyone was concerned about which companies could survive a sharp downturn in the bullion price. We wanted to be succinct, hence the rather dramatic categories and the title, "Thrive, Survive or Die." We've heard from a number of third-party information distributors, such as Bloomberg, that the report had the highest readership for the week in which it was released. Our own website shows that to be the case. From the investment side, it was well received. People on the company side were very mindful of what we were saying. We received direct responses from each company in the Survive and the Die categories, recognizing our comments and addressing the issues, explaining what they are doing in response to the questions that the report posed. The companies were reasonably open in recognizing that they have issues and are addressing them. TGR: It must be nice to be relevant in the conversation. Barry Allan: No doubt about it. The renewed interest in the investment community compared to 12 months ago is gratifying. Average investors are severely underweight in gold stocks. They're very sensitive about it; they recognize that gold equities have come off a bottom, and they're concerned about being underweight. TGR: Let's get to some of those companies starting with the Thrivers. It's a short list. Barry Allan: It is a short list, and the macro point to be taken from its brevity is that the industry can't stay intact at $1000 per ounce gold and $18 per ounce silver. The industry will need to restructure to be functional in the longer term. The companies categorized as Thrives will stay intact. Their balance sheets are comparatively strong. They have mines that work at lower commodity prices. They can generate positive free cash flow even after capital expenditures, which means they won't have to shut down mines or defer development expenditures. TGR: What characterizes a company in your Survivor category? Barry Allan: The Survivors are companies that will need to make material changes to endure at a $1000 per ounce gold price. That means some hard choices: restructuring the balance sheet, deferring or cancelling development projects and/or closing existing mines that contribute to the production profile. TGR: Aside from Thrivers, Survivors and the Dead, do you have any wisdom for gold investors looking for a few rays of hope? Barry Allan: The rays of hope are already evident in the marketplace. While it feels like a bear market in gold and gold equities, it's not. It is has been a fairly aggressive correction, but it's not the doom-and-gloom type of bear market of the past. The market has accepted physical bullion as a legitimate asset class. While there are some "challenging" gold equities, others have conducted their business well and are in good shape. Longer term, we will need to see bullion show a positive investment environment in a higher interest rate environment and a higher Dollar environment, but that's a fight we'll take on late next year. For now, we are happy to enjoy seasonal strength. TGR: Barry, thanks for your time and your insights. | ||||||||
| South Africa’s gold wage talks sway platinum price Posted: 05 Sep 2013 09:24 AM PDT If, however, the bullion strike ends sooner than expected, the platinum celebration may be short-lived. | ||||||||
| 7 AMCU members attacked at strike-hit gold mine Posted: 05 Sep 2013 09:24 AM PDT The union says seven of its members were attacked at strike-hit Beatrix gold mine owned by Sibanye Gold. | ||||||||
| Unpacking India’s new gold import restrictions Posted: 05 Sep 2013 09:24 AM PDT The last few months have seen a litany of new gold import restrictions introduced by the Indian government in a bid to slow imports, UBS takes a shot at unpacking the main points. | ||||||||
| Gold and silver to rise on cheapening currencies Posted: 05 Sep 2013 09:24 AM PDT Julian Phillips thinks, with the currencies cheapening in the emerging world, the price of gold and silver in these countries will rise in local currency terms. | ||||||||
| Gold steady after previous session’s sharp drop Posted: 05 Sep 2013 09:24 AM PDT The gold price steadied Thursday ahead of central bank meetings and US jobs data likely to provide clues on the outlook for US monetary policy. | ||||||||
| Posted: 05 Sep 2013 09:16 AM PDT Unless the gold price breaks higher, says this chart analyst, expect an ultimate slump to $1000... IF YOU HAVE been following the gold price's bumpy ride this year, two simple charts will tell you everything you need to know about the yellow metal's prospects, writes Greg Guenther in the Rude Awakening from Addison Wiggin's Agora Financial. Gold futures are sinking this morning [Weds 4 Sept]. The gold price has dropped about $18 from yesterday's highs, putting gold just below $1395. Gold has slowly trended lower over the last 5 sessions. Its price is consolidating just below $1425. So if you're a fan of the rally off its July lows, you should be encouraged by this action. Right now, gold is approaching an important trading zone. If it successfully penetrates $1425, all of the damage it has endured since mid-May will be repaired.  This chart's zone between $1425 and $1475 won't be easy to leave behind. Remember, this is same area that contained the meat of gold's major drawdown back in April. If long-term bullish buyers really are in control, they will need to make their presence felt if the gold price charts have any chance at all at $1475. However, if you want to truly understand how important this trading zone has become for gold, you have to view gold's entire bull market over the past decade.  Gold lost the mammoth uptrend that guided it to gains since 2002. Now, the gold price is approaching a point where it could attempt to challenge its underlying moving average. If it fails again near $1450, I expect the metal to continue its downtrend, ultimately landing somewhere between $1100-$1000. That would allow a complete retracement of 2010-2011 push toward $2000. I've spent a lot of time talking about the stock market's potential make-or-break moments lately. But gold is now getting to the point where a couple of trading weeks in either direction could ultimately decide its fate. If the gold price fails here, expect another leg lower toward my ultimate price target. | ||||||||
| Posted: 05 Sep 2013 09:16 AM PDT Unless the gold price breaks higher, says this chart analyst, expect an ultimate slump to $1000... IF YOU HAVE been following the gold price's bumpy ride this year, two simple charts will tell you everything you need to know about the yellow metal's prospects, writes Greg Guenther in the Rude Awakening from Addison Wiggin's Agora Financial. Gold futures are sinking this morning [Weds 4 Sept]. The gold price has dropped about $18 from yesterday's highs, putting gold just below $1395. Gold has slowly trended lower over the last 5 sessions. Its price is consolidating just below $1425. So if you're a fan of the rally off its July lows, you should be encouraged by this action. Right now, gold is approaching an important trading zone. If it successfully penetrates $1425, all of the damage it has endured since mid-May will be repaired. This chart's zone between $1425 and $1475 won't be easy to leave behind. Remember, this is same area that contained the meat of gold's major drawdown back in April. If long-term bullish buyers really are in control, they will need to make their presence felt if the gold price charts have any chance at all at $1475. However, if you want to truly understand how important this trading zone has become for gold, you have to view gold's entire bull market over the past decade. Gold lost the mammoth uptrend that guided it to gains since 2002. Now, the gold price is approaching a point where it could attempt to challenge its underlying moving average. If it fails again near $1450, I expect the metal to continue its downtrend, ultimately landing somewhere between $1100-$1000. That would allow a complete retracement of 2010-2011 push toward $2000. I've spent a lot of time talking about the stock market's potential make-or-break moments lately. But gold is now getting to the point where a couple of trading weeks in either direction could ultimately decide its fate. If the gold price fails here, expect another leg lower toward my ultimate price target. | ||||||||
| GOLD & SILVER MANIA TO RIVAL HUGE 1980 ADVANCE & MORE Posted: 05 Sep 2013 09:00 AM PDT from KingWorldNews:
At the end of the summer the French government announced that they were going to fix the pension system. Well, they didn't touch the government employees' pension system, which is half of the problem, because that's too dangerous. It would explode into the streets. So they didn't touch that or fix it, but it's broke. | ||||||||
| Gold Slowly Getting Its Shine Back Posted: 05 Sep 2013 09:00 AM PDT GoldBroker | ||||||||
| Posted: 05 Sep 2013 08:18 AM PDT Gold Falls to New Lows on the Week
The yellow metal tumbled through support marked by Monday’s low at 1379.20, as data released this morning beat expectations for the most part. Of particular note was the significant upward revision to Q2 productivity and ISM-NMI beat. Better than expected initial jobless claims, where tempered by a small miss on the ADP employment survey. While tomorrow’s U.S. nonfarm payrolls report for August is still seen as a key determinant for Fed tapering, the market seems less inclined to be positioned for the status quo on QE. The dollar jumped and yields continued to rise. The yield on U.S. 10-year notes hit 2.96%. That’s up 7 bps on the day, +31 bps over the past month and +135 bps over past year. A push above 3% could cause the recent bond rout to gain momentum and exacerbate the impending debate in Washington over the budget and debt ceiling. As yields continue to rise, so to do the servicing costs of the massive U.S. debt. BoE held the repo rate steady at 0.5% and QE target unchanged at £375 bln, in line with expectations. The ECB left refi rate unchanged at 0.5%, also in line with expectations. During the press conference ECB President Draghi reaffirms the central bank’s easing bias, but said it remained contingent on the inflation outlook. | ||||||||
| Despite heavy winds, Two Fish re-casts its line for Barrick split Posted: 05 Sep 2013 08:16 AM PDT "…This is the world's largest gold mining concern and it doesn't have a geologist or an engineer on its board," Mike Morris, principal, Two Fish Management. | ||||||||
| Gold, silver fall most in 2 months as Putin opposes Syria raid Posted: 05 Sep 2013 08:15 AM PDT Gold and silver futures fell the most in two months as the US faced opposition from Russia on a military strike against Syria. | ||||||||
| The Only Investing Rule That Matters Posted: 05 Sep 2013 08:13 AM PDT Forget everything you've ever learned about the markets. There's only one investing rule you need to know right now—and it has nothing to do with what stocks to buy. More on this idea in just a second… First, I know you buy stocks for a variety of reasons. You'll buy shares because you think a company is cheap relative to its earnings. You buy a stock because the company is about to release a revolutionary new product. Or maybe you think it's a great buyout candidate. Or your neighbor raves about its products. I could go on and on… You're using up all of your energy trying to figure out what to buy. And once you have the shares you want, you just sit there with a blank look on your face. You have no idea what to do next. When it comes to actually selling and booking a profit, you're clueless. You leave it up to rumors, guesses, and knee-jerk economic prognostications. As a quick exercise, let's take a look at how that's worked out over the past five years: In 2009, the market was going to zero because of the banks. They were going to go bankrupt because they did not have enough reserves. Or maybe it was because commercial real estate prices were about to collapse, causing the banks to fail… In 2010, it was Greece and the Euro that were supposed to do us in… In 2011, it was Europe again. Finally, the debt ceiling crisis actually yanked the market lower (but it didn't stick). Toward the end of 2012, we had the Fiscal Cliff and tax increases that were going to cause a recession. Now we're more than halfway through 2013. We had the Cyprus bank debacle ($10 says you had completely forgotten about Cyprus until just now). Today, Syria and the Taper are supposed to do us in. Now, you and I know that one day this bull market will end. But you also know that nearly everyone that is trying to predict the end of this bull market is going to fail. That brings us to our rule… The rule you need to follow while everyone is predicting Armageddon is this: Only price can tell you when to sell. Price is king. Your reasons for buying don't matter. You could be a fundamental investor or a dart-thrower. I really don't care. If you're selling before you receive price signals that the bull run is over, you're never going to maximize your gains. Period. Regards, Greg Guenthner | ||||||||
| Posted: 05 Sep 2013 07:38 AM PDT | ||||||||
| Gold imported by China from Hong Kong rose in July despite big premiums Posted: 05 Sep 2013 07:36 AM PDT Gold Imports to China From Hong Kong Climb on Physical Demand By Feiwen Rong BEIJING -- Gold shipments to China from Hong Kong increased in July as importers took advantage of local prices that were an average 2.1 percent higher than global markets and as mainland investors bought jewelry and coins. Net imports, after deducting flows from China into Hong Kong, were 113 metric tons, from 101 tons a month earlier, according to calculations by Bloomberg. Mainland buyers purchased 129 tons in July, including scrap, compared with 113 tons in June, data from the Hong Kong government showed today. Gold prices that advanced 18 percent from a 34-month low in June are attracting buyers in China, which is on track to overtake India as the world's top bullion consumer this year. Premiums paid by jewelers on top of spot prices on the Shanghai Gold Exchange to take physical delivery of the metal were an average $27 an ounce in China during July, according to calculations by Bloomberg. For the full story: http://www.bloomberg.com/news/2013-09-05/gold-imports-to-china-from-hong... ADVERTISEMENT You Don't Have to Wait for Your Monetary Metal: Many investors lately report having to wait weeks and even months for delivery of their precious metal orders. All Pro Gold works with the largest wholesalers that have inventory "live" -- ready to go. All Pro Gold can ship these "live" gold and silver products as soon as payment funds clear. All Pro Gold can provide immediate delivery of 100-ounce Johnson Matthey silver bars, bags of 90 percent junk silver coins, and 1-ounce silver Austrian Philharmonics. All Pro Gold can deliver silver Canadian maple leafs with a two-day delay and 1-ounce U.S. silver eagles with a 15-day delay. Traditional 1-ounce gold bullion coins and mint-state generic gold double eagles are also available for immediate delivery. All Pro Gold has competitive pricing, and its proprietors, longtime GATA supporters Fred Goldstein and Tim Murphy, are glad to answer any questions or concerns of buyers about the acquisition of precious metals and numismatic coins. Learn more at www.allprogold.com or email info@allprogold.com or telephone All Pro Gold toll-free at 1-855-377-4653. Join GATA here: Gold Investment Symposium 2013 Mines and Money Australia New Orleans Investment Conference https://jeffersoncompanies.com/landing/speakers?IDPromotion=613011610080... * * * 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: | ||||||||
| Poland starts expropriating private pension fund assets Posted: 05 Sep 2013 07:26 AM PDT Poland to Cancel Bonds in Pension Funds By Piotr Skolimowski and Marta Waldoch WARSAW -- Poland will take over and cancel government bonds held by its privately managed pension funds, stopping short of fully "nationalizing" the system as it seeks to curb public debt, Prime Minister Donald Tusk said. Pension funds will keep current assets that they invested in stocks and future contributions to the system by Poles will be "voluntary," Tusk told reporters today. For the full story: http://www.bloomberg.com/news/2013-09-04/poland-to-take-over-bonds-from-... * * * Poland Reduces Public Debt through Pension Funds Overhaul By Dagmara Leszkowicz and Chris Borowski WARSAW -- Poland said on Wednesday it will transfer to the state many of the assets held by private pension funds, slashing public debt but putting in doubt the future of the multi-billion-euro funds, many of them foreign-owned. The changes went deeper than many in the market expected and could fuel investor concerns that the government is ditching some business-friendly policies to try to improve its flagging popularity with voters. The Polish pension funds' organisation said the changes may be unconstitutional because the government is taking private assets away from them without offering any compensation. For the full story: http://www.reuters.com/article/2013/09/04/poland-pensions-idUSL6N0H02UV2... ADVERTISEMENT Don't Let Cyprus Happen to You Depositors at the Bank of Cyprus lost 47.5 percent of their savings. So to preserve your wealth, get some of it outside the banking system into physical gold and silver. Worldwide Precious Metals (Canada) Ltd., established in 2001, specializes in physical gold, silver, platinum, and palladium. We offer delivery or secure and fully insured storage outside the banking system in Brinks vaults. We have access to gold and silver from trusted worldwide refineries and suppliers. And when you have an account with us you have immediate access to it for buying and selling your stored bullion. For information on owning physical precious metals in your portfolio, visit us at: www.wwpmc.com. Join GATA here: Gold Investment Symposium 2013 Mines and Money Australia New Orleans Investment Conference https://jeffersoncompanies.com/landing/speakers?IDPromotion=613011610080... * * * 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: | ||||||||
| What Can We Infer From Copper and Palladium Charts? Posted: 05 Sep 2013 06:34 AM PDT Speaking of Fed... markets are awaiting jobs data on Friday for clues on when the U.S. Federal Reserve will dial back its commodities-friendly stimulus measures that have helped push gold to record highs. However, the Fed meeting ... Read More... | ||||||||
| Gold Imports to China From Hong Kong Climb on Physical Demand Posted: 05 Sep 2013 06:25 AM PDT
Net imports, after deducting flows from China into Hong Kong, were 113 metric tons, from 101 tons a month earlier, according to calculations by Bloomberg. Mainland buyers purchased 129 tons in July, including scrap, compared with 113 tons in June, data from the Hong Kong government showed today. Gold prices that advanced 18 percent from a 34-month low in June are attracting buyers in China, which is on track to overtake India as the world's top bullion consumer this year. Premiums paid by jewelers on top of spot prices on the Shanghai Gold Exchange to take physical delivery of the metal were an average $27 an ounce in China during July, according to calculations by Bloomberg. "China's seeing robust gold sales this year," said Duan Shihua, a partner at commodities fund Shanghai Leading Investment Management Ltd. "The high prices in China's domestic market in July encouraged importers." [source] | ||||||||
| Gold drops as upbeat U.S. data curbs safe-haven demand Posted: 05 Sep 2013 06:10 AM PDT 05-Sep (Reuters) — Gold gave up early gains to fall more than half a percent on Thursday, hurt by a firmer dollar and as upbeat economic data dented its safe-haven appeal. Robust U.S. auto sales numbers also reinforced expectations the U.S. Federal Reserve would start to curb its stimulus later this month. The central bank’s three quantitative easing schemes have buoyed prices for bullion, which is often bought as a hedge against inflation. [source] | ||||||||
| Gold miners near Chicken cry foul over 'heavy-handed' EPA raids Posted: 05 Sep 2013 06:05 AM PDT When agents with the Alaska Environmental Crimes Task Force surged out of the wilderness around the remote community of Chicken wearing body armor and jackets emblazoned with POLICE in big, bold letters, local placer miners didn't quite know what to think. Did it really take eight armed men and a squad-size display of paramilitary force to check for dirty water? Some of the miners, who run small businesses, say they felt intimidated. Others wonder if the actions of the agents put everyone at risk. When your family business involves collecting gold far from nowhere, unusual behavior can be taken as a sign someone might be trying to stage a robbery. How is a remote placer miner to know the people in the jackets saying POLICE really are police? Miners suggest it might have been better all around if officials had just shown up at the door -- as they used to do -- and said they wanted to check the water. Lots of Federal land in Alaska Alaska's vast Interior, which sprawls to the Canadian border, has been the site of federal-local distrust in the past. It was near this area, 130 miles northwest of Chicken, that National Park Service rangers pointed shotguns at, then tackled and arrested a septuagenarian, for not stopping his boat in midstream of the Yukon River in the fall of 2010. Jim Wilde, 70 years old at the time, had been ordered to prepare to be boarded for a safety inspection. Wilde didn't much like that demand. He swore at park rangers and then headed for shore and a meeting on terra firma. Wilde was arrested and taken to the jail in Fairbanks, more than 100 miles away. He was later tried and found guilty by a federal magistrate for failing to comply with a lawful order from federal agents. The state of Alaska, as a whole, can be a place of deeply-rooted mistrust between locals and the agents who try to enforce federal rules. Alaska has more federally owned and managed land than any other U.S. state. More than 65 percent of its land is under some sort of federal control. A multitude of federal parks, preserves and wilderness areas are patrolled by agents from more than a dozen U.S. agencies. Many of the people in rural parts of the state, which are either under federal control or border federally-managed areas, have more contact with federal officers than they do with representatives from the state. Surprised by armed group of officers Miners from the Chicken area -- a gold mining town of just 17 full-time residents and dozens of seasonal miners off the Taylor Highway, between Tok and the Canadian border -- said that during the third week of August they were surprised by groups of four to eight armed officers, who swarmed onto their mining claims with little or no warning. The officers were armed and wearing body armor. They were part of the Alaska Environmental Crimes Task Force and were there to check for violations of section 404 of the Clean Water Act, according to several miners who were contacted by the group. Section 404 governs water discharges into rivers, streams, lakes and oceans. The task force's methods are now being questioned by the miners as well as the Alaska congressional delegation. "Imagine coming up to your diggings, only to see agents swarming over it like ants, wearing full body armor, with jackets that say POLICE emblazoned on them, and all packing side arms," said C.R. "Dick" Hammond, aChicken gold miner who got a visit from the task force. "How would you have felt?" Hammond asked. "You would be wondering, 'My God, what have I done now?'" Hammond and other Chicken area miners aren't alone in wondering what they have done now. Both Alaska U.S. Sens. Lisa Murkowski and Mark Begich have inquired into the task force's actions. Congressman Don Young is also looking into it. They have been having a difficult time getting straight answers from the EPA. Rampant drug and human trafficking? The EPA has refused to publicly explain why it used armed officers as part of what it called a "multi-jurisdictional" investigation of possible Clean Water Act violations in the area. A conference call was held last week to address the investigation. On the line were members of the Alaska Congressional delegation, their staff, state officers, and the EPA. According to one Senate staffer, the federal agency said it decided to send in the task force armed and wearing body armor because of information it received from the Alaska State Troopers about "rampant drug and human trafficking going on in the area." The miners contacted by the task force were working in the area of the Fortymile National Wild and Scenic River. The federal designation, made in 1980 as part of the Alaska National Interest Lands Conservation Act, protects 32 miles between Chicken and Eagle, Alaska. It is a remote area, close to the Canadian border and the town of Boundary. The nearest city of any real size is Fairbanks, 140 miles to the northwest. It was unknown to everyone in the area that there is a rampant problem with drug and human traffickers. This also came as news to the Alaska State Troopers, whom the EPA said supplied the information about drugs and human trafficking, and at least one U.S. senator. "Their explanation -- that there are concerns within the area of rampant drug trafficking and human trafficking going on -- sounds wholly concocted to me," said Murkowski, R-Alaska. "The Alaska State Troopers did not advise the EPA that there was dangerous drug activity. We do not have evidence to suggest that is occurring," said Trooper spokesperson Megan Peters. The Alaska Department of Law said it knew of the task force's investigation but that it did not advise the group about any ongoing problems or dangers in the Fortymile River area. 'Heavy-handed, heavy-armor approach' "This seems to have been a heavy-handed, and heavy-armor approach," said Murkowski. "Why was it so confrontational? The EPA really didn't have any good answers for this." According to the Alaska Department of Environmental Conservation, one of its compliance officers went along with the task force, but only to look for potential state violations at the mine sites. The DEC officer was armed. The task force is made up of members of the EPA, the FBI, Coast Guard, Department of Defense, the Alaska Department of Public Safety and the DEC. The chief investigator, Matt Goers, said he could not discuss the details of the recent Fortymile River investigations. So far, no charges, state or federal, have resulted from the group's work last month. Miners in the area are not waiting for the results of the investigation. They have met in Chicken and are demanding a Sept. 14 meeting with the EPA, the state, and the members of the Alaska federal delegation to discuss the task force's tactics. "Compliance exams are a normal thing for miners. Usually (Bureau of Land Management) or DEC points out a problem and you correct it. This (the task force's action) was way over the top and uncalled for. It was a massive show of intimidation," said David Likins, a gold miner in the Fortymile Mining District. Most of the mines in the area are small, family-run placer operations. They are like the mines seen on on the Reality TV show "Gold Rush: Alaska." They search for gold by digging up ground and running it through a sluice box, using water to wash away the rocks and leave the valuable gold behind. The water they use must be allowed to settle in ponds before it's discharged back into streams or creeks, so that mud and rocks don't pollute clean, nearby waterways. Water turned turbid (cloudy or muddy) can kill fish. Likins said the task force may have found one possible clean water violation at a mine near Boundary, very close to the Canadian border. Likins said he believes the aggressive actions of the task force made their investigation much more dangerous for everyone, including the miners and the agents. "If it were my mine, and I was sitting on some gold, and people came storming out of the woods, I would probably meet them on the porch, with my shotgun," he said. Contact Sean Doogan at sean(at)alaskadispatch.com September 3, 2013 (Source: Alaska Dispatch) http://www.alaskadispatch.com/article/20130903/gold-miners-near-chicken-cry-foul-over-heavy-handed-epa-raids | ||||||||
| Gold miners near Chicken cry foul over 'heavy-handed' EPA raids Posted: 05 Sep 2013 06:05 AM PDT When agents with the Alaska Environmental Crimes Task Force surged out of the wilderness around the remote community of Chicken wearing body armor and jackets emblazoned with POLICE in big, bold letters, local placer miners didn't quite know what to think. Did it really take eight armed men and a squad-size display of paramilitary force to check for dirty water? Some of the miners, who run small businesses, say they felt intimidated. Others wonder if the actions of the agents put everyone at risk. When your family business involves collecting gold far from nowhere, unusual behavior can be taken as a sign someone might be trying to stage a robbery. How is a remote placer miner to know the people in the jackets saying POLICE really are police? Miners suggest it might have been better all around if officials had just shown up at the door -- as they used to do -- and said they wanted to check the water. Lots of Federal land in Alaska Alaska's vast Interior, which sprawls to the Canadian border, has been the site of federal-local distrust in the past. It was near this area, 130 miles northwest of Chicken, that National Park Service rangers pointed shotguns at, then tackled and arrested a septuagenarian, for not stopping his boat in midstream of the Yukon River in the fall of 2010. Jim Wilde, 70 years old at the time, had been ordered to prepare to be boarded for a safety inspection. Wilde didn't much like that demand. He swore at park rangers and then headed for shore and a meeting on terra firma. Wilde was arrested and taken to the jail in Fairbanks, more than 100 miles away. He was later tried and found guilty by a federal magistrate for failing to comply with a lawful order from federal agents. The state of Alaska, as a whole, can be a place of deeply-rooted mistrust between locals and the agents who try to enforce federal rules. Alaska has more federally owned and managed land than any other U.S. state. More than 65 percent of its land is under some sort of federal control. A multitude of federal parks, preserves and wilderness areas are patrolled by agents from more than a dozen U.S. agencies. Many of the people in rural parts of the state, which are either under federal control or border federally-managed areas, have more contact with federal officers than they do with representatives from the state. Surprised by armed group of officers Miners from the Chicken area -- a gold mining town of just 17 full-time residents and dozens of seasonal miners off the Taylor Highway, between Tok and the Canadian border -- said that during the third week of August they were surprised by groups of four to eight armed officers, who swarmed onto their mining claims with little or no warning. The officers were armed and wearing body armor. They were part of the Alaska Environmental Crimes Task Force and were there to check for violations of section 404 of the Clean Water Act, according to several miners who were contacted by the group. Section 404 governs water discharges into rivers, streams, lakes and oceans. The task force's methods are now being questioned by the miners as well as the Alaska congressional delegation. "Imagine coming up to your diggings, only to see agents swarming over it like ants, wearing full body armor, with jackets that say POLICE emblazoned on them, and all packing side arms," said C.R. "Dick" Hammond, aChicken gold miner who got a visit from the task force. "How would you have felt?" Hammond asked. "You would be wondering, 'My God, what have I done now?'" Hammond and other Chicken area miners aren't alone in wondering what they have done now. Both Alaska U.S. Sens. Lisa Murkowski and Mark Begich have inquired into the task force's actions. Congressman Don Young is also looking into it. They have been having a difficult time getting straight answers from the EPA. Rampant drug and human trafficking? The EPA has refused to publicly explain why it used armed officers as part of what it called a "multi-jurisdictional" investigation of possible Clean Water Act violations in the area. A conference call was held last week to address the investigation. On the line were members of the Alaska Congressional delegation, their staff, state officers, and the EPA. According to one Senate staffer, the federal agency said it decided to send in the task force armed and wearing body armor because of information it received from the Alaska State Troopers about "rampant drug and human trafficking going on in the area." The miners contacted by the task force were working in the area of the Fortymile National Wild and Scenic River. The federal designation, made in 1980 as part of the Alaska National Interest Lands Conservation Act, protects 32 miles between Chicken and Eagle, Alaska. It is a remote area, close to the Canadian border and the town of Boundary. The nearest city of any real size is Fairbanks, 140 miles to the northwest. It was unknown to everyone in the area that there is a rampant problem with drug and human traffickers. This also came as news to the Alaska State Troopers, whom the EPA said supplied the information about drugs and human trafficking, and at least one U.S. senator. "Their explanation -- that there are concerns within the area of rampant drug trafficking and human trafficking going on -- sounds wholly concocted to me," said Murkowski, R-Alaska. "The Alaska State Troopers did not advise the EPA that there was dangerous drug activity. We do not have evidence to suggest that is occurring," said Trooper spokesperson Megan Peters. The Alaska Department of Law said it knew of the task force's investigation but that it did not advise the group about any ongoing problems or dangers in the Fortymile River area. 'Heavy-handed, heavy-armor approach' "This seems to have been a heavy-handed, and heavy-armor approach," said Murkowski. "Why was it so confrontational? The EPA really didn't have any good answers for this." According to the Alaska Department of Environmental Conservation, one of its compliance officers went along with the task force, but only to look for potential state violations at the mine sites. The DEC officer was armed. The task force is made up of members of the EPA, the FBI, Coast Guard, Department of Defense, the Alaska Department of Public Safety and the DEC. The chief investigator, Matt Goers, said he could not discuss the details of the recent Fortymile River investigations. So far, no charges, state or federal, have resulted from the group's work last month. Miners in the area are not waiting for the results of the investigation. They have met in Chicken and are demanding a Sept. 14 meeting with the EPA, the state, and the members of the Alaska federal delegation to discuss the task force's tactics. "Compliance exams are a normal thing for miners. Usually (Bureau of Land Management) or DEC points out a problem and you correct it. This (the task force's action) was way over the top and uncalled for. It was a massive show of intimidation," said David Likins, a gold miner in the Fortymile Mining District. Most of the mines in the area are small, family-run placer operations. They are like the mines seen on on the Reality TV show "Gold Rush: Alaska." They search for gold by digging up ground and running it through a sluice box, using water to wash away the rocks and leave the valuable gold behind. The water they use must be allowed to settle in ponds before it's discharged back into streams or creeks, so that mud and rocks don't pollute clean, nearby waterways. Water turned turbid (cloudy or muddy) can kill fish. Likins said the task force may have found one possible clean water violation at a mine near Boundary, very close to the Canadian border. Likins said he believes the aggressive actions of the task force made their investigation much more dangerous for everyone, including the miners and the agents. "If it were my mine, and I was sitting on some gold, and people came storming out of the woods, I would probably meet them on the porch, with my shotgun," he said. Contact Sean Doogan at sean(at)alaskadispatch.com September 3, 2013 (Source: Alaska Dispatch) http://www.alaskadispatch.com/article/20130903/gold-miners-near-chicken-cry-foul-over-heavy-handed-epa-raids | ||||||||
| Gold By The Planeload! Precious Metals Update Part II Posted: 05 Sep 2013 06:00 AM PDT If you believe that gold and silver prices are due to recover, like I do, then you should look for plays that can surf the wave. In particular, you want companies unburdened by debt and not locked into large, complex, expensive projects. Does that ring any bells? Let’s consider royalty companies… Royalty companies own interests in mine production without taking on operational risks and costs. That is, royalty guys “loan” money upfront to capitalize the mine developers, usually at an early stage. In return, the royalty company lays claim to an ongoing income stream generated in the future by the mining project. It’s a well-understood form of project finance, in many instances. The precious metal royalty company that I follow is a well-managed player named Silver Wheaton Corp. (SLW). Shares trade in the $26 range, which is above the company’s 3-year low around $17. Dividend yield is 1.5%. Silver Wheaton is the largest “silver streaming” royalty company in the world. Its profit margin is near 66%, with operating margins north of 70%. Meanwhile, the company is cash-rich — it’s got seven times more cash on hand than debt. Right now, in this very distressed market, Silver Wheaton management is reviewing a long list of sweet deal offers from mining plays that desperately (!) need some of that cash to keep the doors open. And then? As longtime readers know, silver streaming is NOT mining. It means that the royalty owner (here SLW) agrees with the miner to purchase part of future silver production at a fixed, preset price. Thus, a silver streamer need not “invest” in exploration, development, operations and production. In other words, a silver streamer’s fate is tied almost entirely to the price of silver. In that sense, there’s significant share price leverage to the underlying price of the metal. If silver prices rise, shares in SLW rise too, usually by a higher percentage. Don’t Forget to Own the REAL Metal So are we due for a quick turnaround in the prices of gold and silver and the related fortunes of the metal miners? Or is there another leg down for gold and silver until prices find a lower landing pad? It would be great to have a vision of omniscient, sparkling clarity on this, but that’s not a luxury we enjoy. Are there any clues in what the big-guy mining companies are doing? In general, good management teams make assumptions about the future prices for gold and silver. That’s how they capitalize, build and run projects. Some companies assume high prices far into the future and then go deep into debt — see Barrick, from yesterday’s discussion. Also from yesterday, other companies tend to restrain their enthusiasm — Agnico or Goldcorp. But whatever the fundamental assumptions, when metal prices fall significantly, companies and managers go back to the drawing board and figure out which projects make financial sense and which do not. Looking ahead, the pricing environment is sketchy. Gold and silver have trended bearish for far longer than many (certainly I!) expected. This has altered market psychology to the point where many market makers expect more of the same. So we must let the wheel turn for precious metals. Fortunately it appears that precious metals have caught a bid lately. Indeed, some of the same folks expecting prices to continue lower are now singing a different tune. To be sure, markets will do what they do, and it’ll take time for prices and project investments to clarify. Thus, my final precious metal “idea” is to make sure you have exposure to physical metal. Buy metal and TAKE DELIVERY! There are plenty of options when it comes to holding physical metal. You can head down to your local coin dealer and pick up some ingots or look for an online retailer that can insure and ship metal right to your door. Regardless of which method you choose, shop around to get the best deal on the lowest markups and good service. And take! Delivery! (If you don’t have it in your possession, it’s NOT yours!) Right now the nominal prices for precious metals are relatively low, while physical demand in Asia is skyrocketing. I’ve seen video of people rioting in China for the chance to get into a store to buy gold coins and such. Riots in China? Where they send in the army and lock you up in prison for things like that? Overseas, people want gold, and they want it bad. What do they know? In a sense, the West is selling its paper gold down via financialized reflections of reality like the SPDR Gold Trust ETF (GLD) — indeed, as easy as it is to buy this ETF it’s just as easy to sell. Meanwhile, in the East, people are buying and taking physical delivery of gold and silver by the planeload. Yes… By. The. Planeload. (I have seen this phenomenon — gold to China — with my own eyeballs!) It’s not just China, either. For example, the government of India has tightly restricted imports of gold to conserve the value of the national currency. Yet gold smuggling into India is rife. I heard a great story about one innovative crew that actually fabricated fake television sets out of gold and then “imported” the TVs under false manifests. All to beat the government restrictions. Clever. Desperate. The Breaking Bad of gold! So what do these other people and cultures know that we’re not getting here in the U.S. from our government or mainstream media? (That’s a rhetorical question. I hope I don’t have to explain that point to you.) Basically, if you have not bulked up your precious metals holdings, now is the time to get into that play. Buy and… Take! Delivery! Gold and silver prices have been beaten down hard from their recent highs. Lately, though, prices appear to have found a floor. Yes, things could go lower, but in my view, the downside is limited. The upside is… well… When market sentiments turn back to precious metals, we’re in for a major squeeze that should send prices up into the stratosphere. It’s a question of time. It’s a question of when, not if. That’s all for now. Thanks for reading. Byron King | ||||||||
| Posted: 05 Sep 2013 05:31 AM PDT GOLD BULLION prices for London delivery rose back to last week's closing level of $1395 per ounce Thursday morning, reversing an overnight drop of 1.0% as Asian stock markets rose but Europe stocks held flat. The central banks of Japan, the UK and the Eurozone all kept their monetary policy unchanged at today's monthly meetings. US Treasury bonds fell ahead of private US jobs data – expected to show a slight fall in new hiring, before Friday's official Non-Farms Payrolls release. Silver prices meantime joined gold bullion in rising back to last week's finish, unwinding last night's 1.5% drop to trade back above $23.50 per ounce. "China's seeing robust gold sales this year," said Duan Shihua at Shanghai Leading Investment Management, commenting today to Bloomberg after official data showed gold bullion imports to the world's second-largest economy rising again. "The high prices in China's domestic market in July encouraged importers." Gold bullion premiums in China, over and above the benchmark London settlement price, averaged some 2.1% in July, according to Bloomberg. Gold that month began a 20% rise from 3-year lows, while net imports of gold bullion to mainland China through Hong Kong rising to 113.2 tonnes – the highest since March – from 101 in June. Physical gold contracts on the Shanghai Gold Exchange ended today 0.8% above London spot. Premiums on gold bullion in India meantime – the world's No.1 consumer nation – today fell hard, Singapore's Business Times reports, as wholesalers reacted to Wednesday's relaxation of the summer import ban by the Reserve Bank. Even though Indian gold bullion imports could be limited to just 300 tonnes over the next 12 months, according to the Gem & Jewellery Export Promotion Council's Pankaj Parekh, down from almost 900 tonnes in 2012, premiums in Mumbai today fell $5 per ounce. "Due to yesterday's circular, people are expecting consignments will start soon," the paper quotes Haresh Soni, chairman of All India Gems & Jewellery Trade Federation. Tight supplies and high gold bullion premiums also mean "Scrap [supply] is increasing every day," says Soni, because "people are reselling jewellery" as well as gold bars and coins. "Investors are selling gold all across the country," agrees Prithviraj Kothari, director of the Bombay Bullion Association and managing director of leading dealer Riddhisiddhi Bullions Ltd "There is a liquidity crisis and people are selling and putting the money in the bank. There is a huge amount of scrap supply coming into the market." Indian gold bullion premiums fell Thursday to $25-30 per ounce, down from as high as $40 earlier this week. Commenting on the US Federal Reserve's apparent plans to start tapering its $85 billion per month QE program in September, "The G20 Summit is an important forum to seek an international climate that is beneficial for all countries," said Indian prime minister Manmohan Singh ahead of joining the meeting of top 20 economy leaders in St.Petersburg today. Faced with a current account crisis which has driven the Rupee to record lows on the currency markets, down 17% for 2013 to date, "India has emphasised [to the US] there has to be a predictability about the withdrawal," adds secretary for economic affairs Arvind Mayaram, "as it has a spill-over impact on the emerging markets." The Mumbai stock market meantime jumped 2.1% on Thursday, led by the fastest surge in banking shares for more than two years, after new central bank governor Raghuram Rajan announced a "swap line" for foreign currencies worth some $10 billion, plus fresh deregulation of the sector. "It's all about restoring confidence and that Rajan has definitely done," says Sunil Singhania at the $15bn Reliance Capital Asset Management Ltd. Dominating the G20 summit, however, will likely be arguments between Russia and the US over Syria's apparent chemical weapons attack on unarmed civilians two weeks ago. Backing the Kremlin's stance, "Military action would have a negative impact on the global economy," said China's vice finance minister Zhu Guangyao at a press briefing today, "especially on the oil price – it will cause a hike." Crude oil ticked half-a-per cent higher on Thursday morning, taking Brent back above $115 per barrel. "The United States – the main currency issuing country – must consider the spill-over effect of its monetary policy," Zhu also said, "especially the opportunity and rhythm of its exit from the ultra-loose monetary policy." | ||||||||
| Posted: 05 Sep 2013 05:26 AM PDT | ||||||||
| The gold graphs you need to see Posted: 05 Sep 2013 03:00 AM PDT The Real Asset Co | ||||||||
| U.S. Dollar Clues for Trend Over Next Few Months Posted: 04 Sep 2013 10:25 PM PDT Tonight I would like to show you some charts on the US dollar that is finally showing a little action after a month or so of chopping around towards the lows. I have many different looks that might give us a clue or two on what to expect over the next month or so. The first chart is a 6 month daily chart that shows a potential double inverse H&S bottoming formation. As you can see the smaller inverse H&S #1 had a nice long bar on the breakout followed by a backtest the next day. That completed the smaller inverse H&S bottom. The rally only lasted one day which gave us a point to drawn in the 2nd Neckline. The price action is now getting ready to backtest NL #1 again that would create the right shoulder for the bigger inverse H&S #2. So this is a critical backtest taking place in the next day or two to the 81.90 area. If neckline #1 can hold support the price objective of the bigger H&S bottom would be up to the 84.85 area which would be back at the previous high made in July. | ||||||||
| Top 10 Reasons To Buy Gold and Silver Posted: 04 Sep 2013 10:12 PM PDT Mike Maloney writes: As I have said many times before, the economic crisis of 2008 was only a speed bump on the way to the main event. I believe that before the end of this decade there will be an economic crisis so historic that it will eclipse the crash of 29 and the subsequent great depression. I also believe it is both unavoidable and inevitable, because it is merely the free market releasing the stored up energy from decades of economic manipulation. Yes… bad things are going to happen, but it could be the best thing that ever happened to you. | ||||||||
| BREAKING: Silver Miners Lose Half a Billion Dollars Posted: 04 Sep 2013 05:00 PM PDT In an amazing change of events, the top primary silver miners went from making money in the first quarter of 2013, to losing over half a billion dollars in second quarter. The majority of losses came from huge impairment charges due to much lower silver spot prices during the period. |
So, Spain, which is a wonderful country, every other store is shut. And when you talk to people, they are leaving the country. They are going to Africa, to New Zealand, Australia, or whatever, because there are no jobs. It's the same (way) in Portugal.
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