Gold World News Flash

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• Massive sell/buy orders create huge gold market instability
• Are Currency Controls Coming?
• Marine Le Pen: EU Will Collapse Like the Soviet Union
• Billionaire Sprott Says Gold & China To Dominate The World
• Gold as a FOREX Currency
• Billionaire Sprott Asks How Will People Survive What’s Coming?
• Gold market report: Gold breaks out of its short-term downtrend
• 9 Signs That China Is Making A Move Against The U.S. Dollar
• Paper gold will be dumped for real metal, Grant Williams tells KWN
• Silver and Gold Prices Rose 3.1 and 3.7 Percent Respectively this Week
• Silver and Gold Prices Rose 3.1 and 3.7 Percent Respectively this Week
• TF Metals Report: Bullion banks pillaging GLD for metal
• Mike Kosares: China's gold conduit from London, a financial coup d'etat
• Manipulated Markets Prospects: Gold, U.S. Dollar, Bonds, Equities & Interest Rates
• China’s London-Zurich-Hong Kong gold conduit — a major financial coup d’etat
• Vulgar Competition and Italian Gold
• All Hell Will Break Loose And It’s Going To Be “Pandemonium”
• The Daily Market Report
• In The News Today
• Alasdair Macleod: China and gold
• Jim’s Mailbox
• Gene Arensberg: Short-selling banks covering on gold?
• Gold Daily and Silver Weekly Charts - Big Moves In and Out of Comex Bullion Warehouses
• Gold Daily and Silver Weekly Charts - Big Moves In and Out of Comex Bullion Warehouses
• Maguire, Sprott interviewed at KWN
• Maguire Predicted Gold Surge – Now Says West Is Collapsing
• Theater Of The Absurd: Greenspan Writes Book On Economic Forecasting
• Western Credit-Rating Fraud Exposed -- Again
• Market Monitor – October 18th
• Gold-Mining Profits Fallacy
• Gold, Silver, Debt – Don’t Miss These Important Charts
• Billionaire Sprott Asks How Will People Survive What’s Coming?
• Attention Investors: The Blood is Now in the Streets
• The Budget/Debt Ceiling Bill Potentially Eliminates The Debt Ceiling Limit
• The Key Factor To Drive Gold and Silver Prices to Extreme Values
• Is the Rising Stock Market Bullish or Bearish News for Gold?
• Is Rising Stock Market Bullish or Bearish for Gold?
• Gold Is A Reserve Of Safety Says ECB President
• Gold only has one way to go, and that’s up – Hegarty
• Kyrgyz crowd attacks Australian gold miner’s office
• Gold shorts "wrongfooted" by US default swerve
• India’s Sept gold jewellery exports rise 16.5% – trade body
• Massive sell/buy orders create huge gold market instability
• Silver Prices and the Flow of Physical
• Maguire Predicted Gold Surge - Now Says West Is Collapsing
• What the Republican Civil War Means For Gold
• Why You Should Triple-Check the Ticker Before Buying That Stock
• Italy's Gold Sector: Decline & Fall
• Italy's Gold Sector: Decline & Fall
• Italy's Gold Sector: Decline & Fall

Massive sell/buy orders create huge gold market instability Posted: 18 Oct 2013 10:30 PM PDT by Lawrence Williams, MineWeb.com This month has seen a very strange series of gold trades on the futures markets, occurring almost daily, which has had the effect of imposing huge spikes, up and down, but mostly down, on the spot gold price. Reuters' Frank Tang has put together an illuminating graphic illustrating this, showing the numbers of contracts traded daily and the corresponding movement in the gold price. What is apparent from the graphic is that there seem to be massive, almost instantaneous trading volumes every day of over 5,000 contracts (5,000 contracts is half a million ounces) so far this month, all at about the same time and all seemingly designed to move the gold price up or down – with the real massive contract trades on October 1st, and 10th – both well over 20,000 contracts (well over 2 million ounces, or around $2.6 billion) traded – all in a matter of minutes (or less). Read More @ MineWeb.com

Are Currency Controls Coming? Posted: 18 Oct 2013 10:00 PM PDT by David Schectman, MilesFranklin.com: I started writing about the possibility in the late 1990s. And what's the big deal about currency controls? Currency controls will make it impossible to escape the devastation of hyperinflation. And according to John Williams, it will show up in late 2014. It is prudent to get some of your assets off shore now, while you still can, and that includes gold and silver. Who knows what's coming in the precious meals arena? Jim Sinclair has been telling you to Get Out of the System for many months. Bail-ins are coming. Increased taxes are a certainty. The groundwork has been laid for wealth confiscation. And currency controls are being discussed to sell. We can thank our spineless politicians for putting another nail in the dollar's coffin. Read More @ MilesFranklin.com

Marine Le Pen: EU Will Collapse Like the Soviet Union Posted: 18 Oct 2013 09:20 PM PDT by Martin Banks, Henry Samuel and Alex Spillius, The Telegraph: The leader of France's far-Right party has vowed that the European Union would "collapse like the Soviet Union" as she conspired to form what would be the most radical faction yet seen in the European parliament. Marine Le Pen, buoyed by a weekend by-election triumph in southern France, criticised the EU as a "global anomaly" and pledged to return the bloc to a "cooperation of sovereign states". She said Europe's population had "no control" over their economy or currency, nor over the movement of people in their territory. Read More @ Telegraph.co.uk

Billionaire Sprott Says Gold & China To Dominate The World Posted: 18 Oct 2013 09:02 PM PDT In the aftermath of another wild week of trading in which the US Dollar Index closed below the key psychological level of 80, today billionaire Eric Sprott told King World News that gold and China will dominate the world going forward. The Canadian billionaire also told KWN that investors would be wise to follow the Chinese in their investments. Below is what Sprott, who is Chairman of Sprott Asset Management, had to say in part II of this remarkably powerful interview series. This posting includes an audio/video/photo media file: Download Now

Gold as a FOREX Currency Posted: 18 Oct 2013 09:01 PM PDT Another gold writer emailed me the other day with a few questions about my take on the apparent disconnect between the gold price action this year and "physical gold's obvious fundamentals." I explained to him how the POG (price of gold) is thoroughly and utterly disconnected from the physical segment of the gold market today. I said that any increase in physical demand (due to physical gold's

Billionaire Sprott Asks How Will People Survive What’s Coming? Posted: 18 Oct 2013 08:20 PM PDT from KingWorldNews: In the aftermath of the dollar plunge and the gold surge this week, today in his King World News interview billionaire Eric Sprott asked the chilling question, with the collapse that is coming, "as human beings, how is everyone going to survive?" He then stated, "It's a scary prospect." Below is what Sprott, who is Chairman of Sprott Asset Management, had to say in part I of this remarkably powerful interview series. Eric Sprott: "The United States is already insolvent. They announced their own GAAP budget deficit, which was $6 trillion last year. $6 trillion! They (only) had revenues of $3 (trillion). And the combined debt and entitlements is now $60 – $70 trillion. Eric Sprott continues @ KingWorldNews.com

Gold market report: Gold breaks out of its short-term downtrend Posted: 18 Oct 2013 08:00 PM PDT by Alasdair Macleod, Gold Money: The news that dominated the week was the eleventh-hour decision by the Republican Party to back down from its game of chicken against the President over Obama-care, the budget and the debt ceiling. The debate now continues facilitated by the debt ceiling being temporarily abandoned until February, when presumably the game of chicken will be run for a second time if nothing has been agreed. Understandably gold, along with other markets, was victim to rumour and counter-rumour emanating from Washington with few traders prepared to commit themselves until Thursday morning. Read More @ GoldMoney.com

9 Signs That China Is Making A Move Against The U.S. Dollar Posted: 18 Oct 2013 05:09 PM PDT While 20-year highs for the CNY may be enough for many to question the USD's ongoing reserve status, it is clear that there are many other plans afoot that undermine the dominance of the greenback. Submitted by Michael Snyder of The Economic Collapse blog, On the global financial stage, China is playing chess while the U.S. is playing checkers, and the Chinese are now accelerating their long-term plan to dethrone the U.S. dollar.  You see, the truth is that China does not plan to allow the U.S. financial system to dominate the world indefinitely.  Right now, China is the number one exporter on the globe and China will have the largest economy on the planet at some point in the coming years.  The Chinese would like to see global currency usage reflect this shift in global economic power.  At the moment, most global trade is conducted in U.S. dollars and more than 60 percent of all global foreign exchange reserves are held in U.S. dollars.  This gives the United States an enormous built-in advantage, but thanks to decades of incredibly bad decisions this advantage is starting to erode.  And due to the recent political instability in Washington D.C., the Chinese sense vulnerability.  China has begun to publicly mock the level of U.S. debt, Chinese officials have publicly threatened to stop buying any more U.S. debt, the Chinese have started to aggressively make currency swap agreements with other major global powers, and China has been accumulating unprecedented amounts of gold.  All of these moves are setting up the moment in the future when China will completely pull the rug out from under the U.S. dollar. Today, the U.S. financial system is the core of the global financial system.  Because nearly everybody uses the U.S. dollar to buy oil and to trade with one another, this creates a tremendous demand for U.S. dollars around the planet.  So other nations are generally very happy to take our dollars in exchange for oil, cheap plastic gadgets and other things that U.S. consumers "need". Major exporting nations accumulate huge piles of our dollars, but instead of just letting all of that money sit there, they often invest large portions of their currency reserves into U.S. Treasury bonds which can easily be liquidated if needed. So if the U.S. financial system is the core of the global financial system, then U.S. debt is "the core of the core" as some people put it.  U.S. Treasury bonds fuel the print, borrow, spend cycle that the global economy depends upon. That is why a U.S. debt default would be such a big deal.  A default would cause interest rates to skyrocket and the entire global economic system to go haywire. Unfortunately for us, the U.S. debt spiral cannot go on indefinitely.  Our debt is growing far, far more rapidly than our GDP is, and therefore our debt is completely and totally unsustainable. The Chinese understand what is going on, and when the dust settles they plan to be the last ones standing.  In the aftermath of a U.S. collapse, China anticipates having the largest economy on the planet, more gold than anyone else, and a respected international currency that the rest of the globe will be able to use to conduct international trade. And China is not just going to sit back and wait for all of this to happen.  In fact, they are already doing lots of things to get the ball moving.  The following are 9 signs that China is making a move against the U.S. dollar... #1 Chinese credit rating agency Dagong has downgraded U.S. debt from A to A- and has indicated that further downgrades are possible. #2 China has just entered into a very large currency swap agreement with the eurozone that is considered a huge step toward establishing the yuan as a major world currency.  This agreement will result in a lot less U.S. dollars being used in trade between China and Europe... The swap deal will allow more trade and investment between the regions to be conducted in euros and yuan, without having to convert into another currency such as the U.S. dollar first, said Kathleen Brooks, a research director at FOREX.com. "It's a way of promoting European and Chinese trade, but not doing it with the U.S. dollar," said Brooks. "It's a bit like cutting out the middleman, all of a sudden there's potentially no U.S. dollar risk." #3 Back in June, China signed a major currency swap agreement with the United Kingdom.  This was another very important step toward internationalizing the yuan. #4 China currently owns about 1.3 trillion dollars of U.S. debt, and this enormous exposure to U.S. debt is starting to become a major political issue within China. #5 Mei Xinyu, Commerce Minister adviser to the Chinese government, warned this week that if the U.S. government ever does default that China may decide to completely stop buying U.S. Treasury bonds. #6 According to Yahoo News, China has already been looking for ways to diversify away from the U.S. dollar... There have been media reports this week that China's State Administration of Foreign Exchange, the body that handles the country's $3.66 trillion of foreign exchange reserve, is looking to diversify into real estate investments in Europe. #7 Xinhua, the official news agency of China, called for a "de-Americanized world" this week, and also made the following statement about the political turmoil in Washington: "The cyclical stagnation in Washington for a viable bipartisan solution over a federal budget and an approval for raising debt ceiling has again left many nations' tremendous dollar assets in jeopardy and the international community highly agonized." #8 Xinhua also said the following about the U.S. debt deal on Thursday: "[P]oliticians in Washington have done nothing substantial but postponing once again the final bankruptcy of global confidence in the U.S. financial system".  The commentary in the government-run publication also declared that the debt deal "was no more than prolonging the fuse of the U.S. debt bomb one inch longer." #9 China is the largest producer of gold in the world, and it has also been importing an absolutely massive amount of gold from other nations.  But instead of slowing down, the Chinese appear to be accelerating their gold buying.  In fact, money manager Stephen Leeb says that his sources are telling him that China plans to buy another 5,000 tons of gold.  There are many that are convinced that China eventually plans to back the yuan with gold and try to make it the number one alternative to the U.S. dollar. So exactly what would happen if the Chinese announced someday that they were going to back their currency with gold and would no longer be using the U.S. dollar in international trade? It would change the face of the global economy almost overnight.  In a previous article, I described some of the things that we could expect to see happen... If China does decide to back the yuan with gold and no longer use the U.S. dollar in international trade, it will have devastating effects on the U.S. economy.  Demand for the U.S. dollar and U.S. debt would drop like a rock, and prices on the things that we buy every day would soar.  At that point you could forget about cheap gasoline or cheap Chinese imports.  Our entire way of life depends on the U.S. dollar being the primary reserve currency of the world and being able to import things very inexpensively.  If the rest of the world (led by China) starts to reject the U.S. dollar, it would result in a massive tsunami of currency coming back to our shores and a very painful adjustment in our standard of living.  Today, most U.S. currency is actually used outside of the United States.  If someday that changes and we are no longer able to export our inflation that is going to mean big trouble for us. The fact that we get to print up giant mountains of money and virtually everyone around the world uses it has been a huge boon for the U.S. economy. When that changes, the word "catastrophic" is not going to be nearly strong enough to describe what is going to happen. According to a Rasmussen Reports survey that was released this week, only 13 percent of all Americans believe that the country is on the right track.  But the truth is that these are the good times.  The American people haven't seen anything yet. Someday people will look back and desperately wish that they could go back to the "good old days" of 2012 and 2013.  This is about as good as things are going to get, and it is only downhill from here.

Paper gold will be dumped for real metal, Grant Williams tells KWN Posted: 18 Oct 2013 04:40 PM PDT 10:37a AEST Saturday, October 19, 2013 Dear Friend of GATA and Gold: Singapore fund manager Grant Williams tells King World News that someday, maybe soon, paper gold is going to be dumped for the real thing: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/10/18_A... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT Buy metals at GoldMoney and enjoy international storage GoldMoney was established in 2001 by James and Geoff Turk and is safeguarding more than $1.7 billion in metals and currencies. Buy gold, silver, platinum, and palladium from GoldMoney over the Internet and store them in vaults in Canada, Hong Kong, Singapore, Switzerland, and the United Kingdom, ­taking advantage of GoldMoney's low storage rates, among the most competitive in the industry. GoldMoney also offers delivery of 100-gram and 1-kilogram gold bars and 1-kilogram silver bars. To learn more, please visit: http://www.goldmoney.com/?gmrefcode=gata Join GATA here: The Silver Summit Davenport Hotel, Spokane, Washington Thursday-Friday, October 24-25, 2013 http://www.cambridgehouse.com/event/silver-summit-2013 Mines and Money Australia Melbourne Conference and Exhibition Centre Tuesday, October 29-Friday, November 1, 2013 http://www.minesandmoney.com/ New Orleans Investment Conference Sunday-Wednesday, November 10-13, 2013 Hilton New Orleans Riverside Hotel New Orleans, Louisiana 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: http://gata.org/tshirts 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: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT How to profit with silver -- and which stocks to buy now Future Money Trends is offering a special 16-page silver report with our forecast for 2013 that includes profiles of nine companies and technical analysis of their stock performance. Six of the companies have market capitalizations of less than $800 million and one company has a market cap of only $30 million. The most exciting of these companies will begin production in a few weeks and has a market cap of just $150 million. Half of all proceeds from the sale of this report will be donated to the Gold Anti-Trust Action Committee to support its efforts exposing manipulation and fraud in the gold and silver markets. To learn about this report, please visit: http://www.futuremoneytrends.com/index.php?option=com_content&id=376&tmp...

Silver and Gold Prices Rose 3.1 and 3.7 Percent Respectively this Week Posted: 18 Oct 2013 04:35 PM PDT Gold Price Close Today : 1,314.40 Gold Price Close 11-Oct-13 : 1,268.00 Change : 46.40 or 3.7% Silver Price Close Today : 21.869 Silver Price Close 11-Oct-13 : 21.215 Change : 0.654 or 3.1% Gold Silver Ratio Today : 60.103 Gold Silver Ratio 11-Oct-13 : 59.769 Change : 0.33 or 0.6% Silver Gold Ratio : 0.01664 Silver Gold Ratio 11-Oct-13 : 0.01673 Change : -0.00009 or -0.6% Dow in Gold Dollars : $ 242.19 Dow in Gold Dollars 11-Oct-13 : $ 248.41 Change : -$6.21 or -2.5% Dow in Gold Ounces : 11.716 Dow in Gold Ounces 11-Oct-13 : 12.017 Change : -0.30 or -2.5% Dow in Silver Ounces : 704.18 Dow in Silver Ounces 11-Oct-13 : 718.22 Change : -14.05 or -2.0% Dow Industrial : 15,399.65 Dow Industrial 11-Oct-13 : 15,237.11 Change : 162.54 or 1.1% S&P 500 : 1,744.50 S&P 500 11-Oct-13 : 1,703.20 Change : 41.30 or 2.4% US Dollar Index : 79.634 US Dollar Index 11-Oct-13 : 80.426 Change : -0.792 or -1.0% Platinum Price Close Today : 1,434.80 Platinum Price Close 11-Oct-13 : 1,372.90 Change : 61.90 or 4.5% Palladium Price Close Today : 739.65 Palladium Price Close 11-Oct-13 : 713.05 Change : 26.60 or 3.7% The GOLD PRICE gave back $8.30 of yesterday's dramatic $40.70 gain and closed Comex at $1,314.40. Silver coughed up 3.4 cents of yesterday's 58.3 cent gain for a 2186.9c close. Still, yesterday's gains powerfully confirmed the Key Reversal on Tuesday and left both silver and GOLD PRICES above their 20 day moving averages, first tripwire of upward momentum. Behold, both silver and gold prices have also formed bullish falling wedge patterns, and yesterday's surge released them on their own recognizance ("broke them out") of that pattern. Unless contradicted by closes below 2090 and 1872, we have to assume that silver and gold prices are rallying. If they close below those points, both will revisit the June lows. Up above, for all its pep the SILVER PRICE has not been able to close above 2200c and stay there. Now silver must show its cards or fold, rising above 2200c and 2250c (50 DMA is at 2245c) in short order. Gold must confirm a rally by closing above $1,332 as the first step of an advance. 50 DMA awaits then at $1,343. Gold price rose 3.7% for the week, silver 3.1%. Respectable, but the weekly charts still show both below their 20 week moving averages. GOLD/SILVER RATIO is behaving by not rising, but I would like to see silver outpacing gold. Sure enough, when the cloud of the debt-ceiling kerfuffle passed over the market, stocks rose and the dollar fell. Surprising the Great and Mighty, silver and GOLD PRICES took that news quite well, thank you very much. By the way, the debt-ceiling deal changed nothing, reformed nothing, cured nothing. Federal government spending remains out of control, and federal debt has grown so large it will never be paid. Default is certain, only the date is uncertain. The yankee government will either repudiate the debt outright or inflate it away. Right now, they're inflating it away, and that will continue. If you think "This will never happen -- the dollar is the world's reserve currency!" or "America has the world's strongest economy," well, you just keep thinking that, and wait for reality to catch up with your error. Stocks indices argued yesterday but got in line today. Dow gained 28 (0.18%) for a 15,399.65 close. S&P500 rose 11.35 (0.65%) to 1,744.50. S&P500 gapped up and made another all -time high, punching barely through the overhead trend line. Dow remains 300 points below its overhead trendline. S&P500 could spurt further still, but odds are against much more rise here. It has formed a rising wedge from which it will most likely fall down. Right now it's going higher because -- its price is rising. In other words, it's a mania. I looked at Google today, which just rose above $1,000/share. It's price/earnings ratio is 29.15, another way of saying it would pay back your principle in 29.15 years. Or it pays a 0.25% return roughly. Whoa! That's not "dividend yield," because Google pays NO dividend. This is a greater fool market — "Buy because prices are rising." By the way, some folks believe that inflation will also help stocks. Constantino Bresciani-Turroni wrote The Economics of Inflation examining the German hyperinflation. He found that stocks did not keep pace with inflation. Dow in gold and Dow in silver both fell for the week, but rose a tiny bit today. Dow in silver ended the week at 704.18 oz, down 2% for the week. Dow in gold closed 11.716, down 2.5% this week. Both indicators are still locked in a downtrend, good news for silver and gold investors. Need to see them close below their 20 DMAs, now at 699.74 oz and 11.60. US dollar index is flirting with the 79.60-ish area that forms the lip of a cliff. Should it fall over that, it won't land before 73. Lost 0.7% today, 5.1 basis points, to 79.634. Euro rose slightly, 0.85 to $1.3687. Put yourself in the place of the European Nice Government Men, manipulating the euro. Would you really want your currency to rise against the dollar, pricing your goods out of markets around the world and opening the door to cheaper US goods? Maybe the deal's been struck with the US NGM to let the euro rise and dollar fall, but why? Sooner or later that tight shoe will begin to pinch. Yen rose 0.16 today to 102.32. Nipponese NGM doing their best to keep it steady, regardless what the dollar does. All this explains why I wouldn't buy any scrofulous fiat currencies even with y'all's money. Game is wholly rigged, and they're playing "competitive devaluation." I saw an internet dust-up today about JP Morgan Chase Bank informing its customers it would limit cash withdrawals to $50,000/month and limit overseas wires. Various voices found in this harbingers of exchange controls and other tyrannies. Might be, but I have to ask, Why would you leave your money in JPM anyway? Do you simply enjoy feeding your enemy? Why not put your money in a small bank you might be able to trust at least a little? And besides, why don't you have at least three months' cash needs in a safe place OUTside the banking system anyway? As Catherine Fitts says, "Come clean!" Stop leaving your money in the banks that are destroying you and your country. Y'all enjoy your weekend! Argentum et aurum comparenda sunt -- -- Gold and silver must be bought. - Franklin Sanders, The Moneychanger The-MoneyChanger.com © 2013, The Moneychanger. May not be republished in any form, including electronically, without our express permission. To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $3,130.00; silver's primary is up targeting 16:1 gold/silver ratio or $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold or 18 ounces of silver. or 18 ounces of silver. US $ and US$-denominated assets, primary trend down; real estate bubble has burst, primary trend down. WARNING AND DISCLAIMER. Be advised and warned: Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures. NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps. NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced. NOR do I recommend buying gold and silver on margin or with debt. What DO I recommend? Physical gold and silver coins and bars in your own hands. One final warning: NEVER insert a 747 Jumbo Jet up your nose.

Silver and Gold Prices Rose 3.1 and 3.7 Percent Respectively this Week Posted: 18 Oct 2013 04:35 PM PDT Gold Price Close Today : 1,314.40 Gold Price Close 11-Oct-13 : 1,268.00 Change : 46.40 or 3.7% Silver Price Close Today : 21.869 Silver Price Close 11-Oct-13 : 21.215 Change : 0.654 or 3.1% Gold Silver Ratio Today : 60.103 Gold Silver Ratio 11-Oct-13 : 59.769 Change : 0.33 or 0.6% Silver Gold Ratio : 0.01664 Silver Gold Ratio 11-Oct-13 : 0.01673 Change : -0.00009 or -0.6% Dow in Gold Dollars : $ 242.19 Dow in Gold Dollars 11-Oct-13 : $ 248.41 Change : -$6.21 or -2.5% Dow in Gold Ounces : 11.716 Dow in Gold Ounces 11-Oct-13 : 12.017 Change : -0.30 or -2.5% Dow in Silver Ounces : 704.18 Dow in Silver Ounces 11-Oct-13 : 718.22 Change : -14.05 or -2.0% Dow Industrial : 15,399.65 Dow Industrial 11-Oct-13 : 15,237.11 Change : 162.54 or 1.1% S&P 500 : 1,744.50 S&P 500 11-Oct-13 : 1,703.20 Change : 41.30 or 2.4% US Dollar Index : 79.634 US Dollar Index 11-Oct-13 : 80.426 Change : -0.792 or -1.0% Platinum Price Close Today : 1,434.80 Platinum Price Close 11-Oct-13 : 1,372.90 Change : 61.90 or 4.5% Palladium Price Close Today : 739.65 Palladium Price Close 11-Oct-13 : 713.05 Change : 26.60 or 3.7% The GOLD PRICE gave back $8.30 of yesterday's dramatic $40.70 gain and closed Comex at $1,314.40. Silver coughed up 3.4 cents of yesterday's 58.3 cent gain for a 2186.9c close. Still, yesterday's gains powerfully confirmed the Key Reversal on Tuesday and left both silver and GOLD PRICES above their 20 day moving averages, first tripwire of upward momentum. Behold, both silver and gold prices have also formed bullish falling wedge patterns, and yesterday's surge released them on their own recognizance ("broke them out") of that pattern. Unless contradicted by closes below 2090 and 1872, we have to assume that silver and gold prices are rallying. If they close below those points, both will revisit the June lows. Up above, for all its pep the SILVER PRICE has not been able to close above 2200c and stay there. Now silver must show its cards or fold, rising above 2200c and 2250c (50 DMA is at 2245c) in short order. Gold must confirm a rally by closing above $1,332 as the first step of an advance. 50 DMA awaits then at $1,343. Gold price rose 3.7% for the week, silver 3.1%. Respectable, but the weekly charts still show both below their 20 week moving averages. GOLD/SILVER RATIO is behaving by not rising, but I would like to see silver outpacing gold. Sure enough, when the cloud of the debt-ceiling kerfuffle passed over the market, stocks rose and the dollar fell. Surprising the Great and Mighty, silver and GOLD PRICES took that news quite well, thank you very much. By the way, the debt-ceiling deal changed nothing, reformed nothing, cured nothing. Federal government spending remains out of control, and federal debt has grown so large it will never be paid. Default is certain, only the date is uncertain. The yankee government will either repudiate the debt outright or inflate it away. Right now, they're inflating it away, and that will continue. If you think "This will never happen -- the dollar is the world's reserve currency!" or "America has the world's strongest economy," well, you just keep thinking that, and wait for reality to catch up with your error. Stocks indices argued yesterday but got in line today. Dow gained 28 (0.18%) for a 15,399.65 close. S&P500 rose 11.35 (0.65%) to 1,744.50. S&P500 gapped up and made another all -time high, punching barely through the overhead trend line. Dow remains 300 points below its overhead trendline. S&P500 could spurt further still, but odds are against much more rise here. It has formed a rising wedge from which it will most likely fall down. Right now it's going higher because -- its price is rising. In other words, it's a mania. I looked at Google today, which just rose above $1,000/share. It's price/earnings ratio is 29.15, another way of saying it would pay back your principle in 29.15 years. Or it pays a 0.25% return roughly. Whoa! That's not "dividend yield," because Google pays NO dividend. This is a greater fool market — "Buy because prices are rising." By the way, some folks believe that inflation will also help stocks. Constantino Bresciani-Turroni wrote The Economics of Inflation examining the German hyperinflation. He found that stocks did not keep pace with inflation. Dow in gold and Dow in silver both fell for the week, but rose a tiny bit today. Dow in silver ended the week at 704.18 oz, down 2% for the week. Dow in gold closed 11.716, down 2.5% this week. Both indicators are still locked in a downtrend, good news for silver and gold investors. Need to see them close below their 20 DMAs, now at 699.74 oz and 11.60. US dollar index is flirting with the 79.60-ish area that forms the lip of a cliff. Should it fall over that, it won't land before 73. Lost 0.7% today, 5.1 basis points, to 79.634. Euro rose slightly, 0.85 to $1.3687. Put yourself in the place of the European Nice Government Men, manipulating the euro. Would you really want your currency to rise against the dollar, pricing your goods out of markets around the world and opening the door to cheaper US goods? Maybe the deal's been struck with the US NGM to let the euro rise and dollar fall, but why? Sooner or later that tight shoe will begin to pinch. Yen rose 0.16 today to 102.32. Nipponese NGM doing their best to keep it steady, regardless what the dollar does. All this explains why I wouldn't buy any scrofulous fiat currencies even with y'all's money. Game is wholly rigged, and they're playing "competitive devaluation." I saw an internet dust-up today about JP Morgan Chase Bank informing its customers it would limit cash withdrawals to $50,000/month and limit overseas wires. Various voices found in this harbingers of exchange controls and other tyrannies. Might be, but I have to ask, Why would you leave your money in JPM anyway? Do you simply enjoy feeding your enemy? Why not put your money in a small bank you might be able to trust at least a little? And besides, why don't you have at least three months' cash needs in a safe place OUTside the banking system anyway? As Catherine Fitts says, "Come clean!" Stop leaving your money in the banks that are destroying you and your country. Y'all enjoy your weekend! Argentum et aurum comparenda sunt -- -- Gold and silver must be bought. - Franklin Sanders, The Moneychanger The-MoneyChanger.com © 2013, The Moneychanger. May not be republished in any form, including electronically, without our express permission. To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $3,130.00; silver's primary is up targeting 16:1 gold/silver ratio or $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold or 18 ounces of silver. or 18 ounces of silver. US $ and US$-denominated assets, primary trend down; real estate bubble has burst, primary trend down. WARNING AND DISCLAIMER. Be advised and warned: Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures. NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps. NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced. NOR do I recommend buying gold and silver on margin or with debt. What DO I recommend? Physical gold and silver coins and bars in your own hands. One final warning: NEVER insert a 747 Jumbo Jet up your nose.

TF Metals Report: Bullion banks pillaging GLD for metal Posted: 18 Oct 2013 04:34 PM PDT 10:30a AEST Saturday, October 19, 2013 Dear Friend of GATA and Gold: The TF Metal Report's Turd Ferguson today reports more evidence that the gold exchange-trade fund GLD is being pillaged by the major bullion banks to cover short positions in gold elsewhere: http://www.tfmetalsreport.com/blog/5167/pillaging-gld CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT How to profit with silver -- and which stocks to buy now Future Money Trends is offering a special 16-page silver report with our forecast for 2013 that includes profiles of nine companies and technical analysis of their stock performance. Six of the companies have market capitalizations of less than $800 million and one company has a market cap of only $30 million. The most exciting of these companies will begin production in a few weeks and has a market cap of just $150 million. Half of all proceeds from the sale of this report will be donated to the Gold Anti-Trust Action Committee to support its efforts exposing manipulation and fraud in the gold and silver markets. To learn about this report, please visit: http://www.futuremoneytrends.com/index.php?option=com_content&id=376&tmp... Join GATA here: The Silver Summit Davenport Hotel, Spokane, Washington Thursday-Friday, October 24-25, 2013 http://www.cambridgehouse.com/event/silver-summit-2013 Mines and Money Australia Melbourne Conference and Exhibition Centre Tuesday, October 29-Friday, November 1, 2013 http://www.minesandmoney.com/ New Orleans Investment Conference Sunday-Wednesday, November 10-13, 2013 Hilton New Orleans Riverside Hotel New Orleans, Louisiana 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: http://gata.org/tshirts 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: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT Buy metals at GoldMoney and enjoy international storage GoldMoney was established in 2001 by James and Geoff Turk and is safeguarding more than $1.7 billion in metals and currencies. Buy gold, silver, platinum, and palladium from GoldMoney over the Internet and store them in vaults in Canada, Hong Kong, Singapore, Switzerland, and the United Kingdom, ­taking advantage of GoldMoney's low storage rates, among the most competitive in the industry. GoldMoney also offers delivery of 100-gram and 1-kilogram gold bars and 1-kilogram silver bars. To learn more, please visit: http://www.goldmoney.com/?gmrefcode=gata

Mike Kosares: China's gold conduit from London, a financial coup d'etat Posted: 18 Oct 2013 04:23 PM PDT 10:19a AEST Saturday, October 19, 2013 Dear Friend of GATA and Gold: Centennial Precious Metals proprietor Mike Kosares today reports documentation of huge gold flows from London through Switzerland to China. His commentary is headlined "China's London-Zurich-Hong Kong Gold Conduit -- A Major Financial Coup D'Etat" and it's posted at Centennial's Internet site, USAGold, here: http://www.usagold.com/cpmforum/2013/10/18/chinas-london-zurich-hong-kon... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT How to profit with silver -- and which stocks to buy now Future Money Trends is offering a special 16-page silver report with our forecast for 2013 that includes profiles of nine companies and technical analysis of their stock performance. Six of the companies have market capitalizations of less than $800 million and one company has a market cap of only $30 million. The most exciting of these companies will begin production in a few weeks and has a market cap of just $150 million. Half of all proceeds from the sale of this report will be donated to the Gold Anti-Trust Action Committee to support its efforts exposing manipulation and fraud in the gold and silver markets. To learn about this report, please visit: http://www.futuremoneytrends.com/index.php?option=com_content&id=376&tmp... * * * Join GATA here: The Silver Summit Davenport Hotel, Spokane, Washington Thursday-Friday, October 24-25, 2013 http://www.cambridgehouse.com/event/silver-summit-2013 Mines and Money Australia Melbourne Conference and Exhibition Centre Tuesday, October 29-Friday, November 1, 2013 http://www.minesandmoney.com/ New Orleans Investment Conference Sunday-Wednesday, November 10-13, 2013 Hilton New Orleans Riverside Hotel New Orleans, Louisiana 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: http://gata.org/tshirts 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: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT Buy metals at GoldMoney and enjoy international storage GoldMoney was established in 2001 by James and Geoff Turk and is safeguarding more than $1.7 billion in metals and currencies. Buy gold, silver, platinum, and palladium from GoldMoney over the Internet and store them in vaults in Canada, Hong Kong, Singapore, Switzerland, and the United Kingdom, ­taking advantage of GoldMoney's low storage rates, among the most competitive in the industry. GoldMoney also offers delivery of 100-gram and 1-kilogram gold bars and 1-kilogram silver bars. To learn more, please visit: http://www.goldmoney.com/?gmrefcode=gata

Manipulated Markets Prospects: Gold, U.S. Dollar, Bonds, Equities & Interest Rates Posted: 18 Oct 2013 03:02 PM PDT Deepcaster

China’s London-Zurich-Hong Kong gold conduit — a major financial coup d’etat Posted: 18 Oct 2013 02:57 PM PDT by Michael J. Kosares United Kingdom gold exports to Switzerland jumped from 85 tonnes to 1,016 tonnes in the first eight months of 2013 — a twelve times rise. Some bullion market watchers attribute the huge increase to withdrawals or sales from ETFs — an explanation that covers only half the story…….if that. Switzerland, according to the Koos Jansen website, has exported nearly 500 tonnes of gold to Hong Kong through July, 2013. Hong Kong, in turn, has exported over 1200 tonnes of gold to the China mainland over the same period. Now, with this report of ramped-up exports from the United Kingdom, another piece of the puzzle falls into place and we begin to get a fairly clear picture what these gold mobilizations entail. Switzerland and Hong Kong are acting as a conduit of western gold on its way to China — and Chinese central bank reserves. To what extent this gold mobilization is the result of some yet to be identified external pressure on London’s bullion banks, or simply business as usual, remains to be determined, but gold movements of this size usually do not occur in a vacuum. Hedge funds have been in the gold ETF liquidation mode since April, at the behest, it seems, of certain bullion banks that have isused generalized ETF sell recommendations to their clientele (which includes the funds). The ETF selling has been blamed repeatedly for the rapid drop in price. If all of this has been a ploy to drive down the price on paper and channel substantial amounts of physical gold to China, who is the winner in this game and who is the loser? The gold market is forever and always opaque (no matter how diligent or persistent the arguments that it isn’t or that it should not be), and that is probably why so many are intrigued by it. Yet, at the same time, those who innocently own gold for asset preservation purposes can rest assured that they will never become collateral damage in these affairs as long as they do not allow themselves to lose patience or forget the reasons why they purchased gold in the first place. Gold is never sought by those who think all is right with the world. It is sought by those who believe that things could go wrong, or indeed, that things have already gone very badly. That true believer might be someone of incredible private wealth, as it was Bernard Baruch in the 1930s, or it might be a great nation state like Germany or China today. When the sitting secretary of the Treasury asked Bernard Baruch why he was buying so much gold, the reply came quickly that he “was commencing to have doubts about the currency.” China and Germany, no doubt, are acting on doubts of their own. Up until today, we were unaware of the degree to which those doubts had manifested themselves in the hidden corridors of the world gold market. . . .Now we know. In the first eight months of 2013, China produced 270 tonnes of gold from its mines, and almost four times that amount through its London – Zurich – Hong Kong gold conduit — a major financial coup d’etat. Link to Reuters article “Gold exports to Switzerland surge as investors sell ETFs” Also see related: Euro, yuan swap deal comes in under the radar, but log it for the future ____________ If you are looking for a gold-based analysis of the financial markets and economy, we invite you to subscribe to our FREE newsletter – USAGOLD Review & Outlook, edited by Michael J. Kosares, the author of the preceding post, the founder of USAGOLD and the author of “The ABCs of Gold Investing: How To Protect And Build Your Wealth With Gold.” You can opt out any time and we won’t deluge you with junk e-mails.

Vulgar Competition and Italian Gold Posted: 18 Oct 2013 02:30 PM PDT "Italy accused of protectionism!" is hardly news. Wanting free competition in the airline market, IAG - the group formed from the UK's privatized British Airways and Spain's privatized Iberia in 2012 - has urged the European Commission ... Read More...

All Hell Will Break Loose And It’s Going To Be “Pandemonium” Posted: 18 Oct 2013 02:06 PM PDT Today one of the most highly respected fund managers in Singapore warned King World News that investors around the world need to be prepared because the West is nearing that point where "all hell is going to break loose." Grant Williams, who is portfolio manager of the Vulpes Precious Metals Fund, also warned that as the real financial chaos begins "it's going to look like pandemonium." Williams also spoke about what all of this will mean for investors in key markets such as gold and silver in his powerful interview below. This posting includes an audio/video/photo media file: Download Now

The Daily Market Report Posted: 18 Oct 2013 02:00 PM PDT Gold Remains Firm After U.S. Can Kick 18-Oct (USAGOLD) — Gold remained well bid, but narrowly confined on Friday. The sharp gains recorded on Thursday, after the deal to reopen the government and suspend the debt ceiling was passed, were sustained. Mission accomplished. Can kicked. Crisis averted. At least for another several months… As we discussed in Thursday’s DMR, the market realizes that the debt ceiling is more a target than any real attempt to limit the amount of debt accumulated. Gold rallied smartly back in 2011 when that debt ceiling deal was struck as well. At this point we don’t even know what the new debt ceiling might be, the ceiling has simply been suspended until February 7. Treasury can borrow whatever it needs — unhindered for the time being by a pesky ceiling — putting us ever-deeper in debt and moving inexorably toward that as yet to be determined new debt “target”. The Fed of course has been the buyer of the majority of Treasury’s new debt issuance in recent years, and they will likely continue to step up to the plate. The prospects for tapering have dimmed even further. The day after the 2011 deal, our debt exploded by $238 bln. It was the largest one-day increase in the history of the United States, which took our debt/GDP ratio beyond 100% for the first time since World War II. S&P downgraded the U.S. a couple days after that. Although the threat of imminent default has been averted, China’s Danong ratings agency quickly downgraded U.S. sovereign debt to A- from A. In a press release Danong said: "The [U.S.] government is still approaching the verge of a default crisis, a situation that cannot be substantially alleviated in the foreseeable future." This move came days after China Daily ran an op-ed calling for China to “gradually reduce its current dollar holdings as a matter of financial prudence and steadily work with others toward a new global financial architecture.” In short, China would very much like to see an alternative to the dollar as the global reserve currency. The financial press is indeed rife with stories these days about the decline of dollar supremacy. Our mounting debt burden, our propensity to try and paper over our problems by printing ever-more dollars, along with persistent political intransigence are all to blame. Jim Grant of Grant’s Interest Rate Observer, summed it up on BloombergTV yesterday by saying “The U.S. government is persistently, chronically and abidingly cash flow negative. We can’t get along without more debt.” Indeed, the U.S. debt is expected to reach $23 trillion in the next five-years and if the economy takes another turn for the worse, I fear it could be much worse than that. There’s a requirement in the deal that calls on Congress to hammer out longer-term tax and spending policies for the next decade and report by December 13. We need look back no further than the so-called “super-committee” that begot the sequester to deduce the likely success of that endeavor. So, sometime early next year, this whole nonsense will begin all over again, further diminishing our already eroded standing as the global economic superpower and keeper of the world’s reserve currency. I’m not surprised in the least that the dollar has tumbled to a new eight-month low and gold is up nearly 3% today. In the aforementioned Bloomberg interview, Jim Grant said he still believes in gold “fundamentally and over the long-term as the legacy and final monetary asset.” It would seem I share more than a last name with Mr. Grant…

In The News Today Posted: 18 Oct 2013 01:58 PM PDT Jim Sinclair’s Commentary This drama is far from over. As U.S. averts default, Japan and China brace for next dollar drama By Wayne Arnold and Leika Kihara HONG KONG/TOKYO (Reuters) – Deal or no deal, the U.S. Congress’ dance with default impressed policymakers and investors in China and Japan with just how vulnerable their own... Read more » The post In The News Today appeared first on Jim Sinclair's Mineset.

Alasdair Macleod: China and gold Posted: 18 Oct 2013 01:22 PM PDT 7:17a AEST Saturday, October 19, 2013 Dear Friend of GATA and Gold: Frantically selling gold, the West is forfeiting economic power to China and other Eastern nations that appear to be buying more metal than annual mine production, GoldMoney research director Alasdair Macleod writes today. His commentary is headlined "China and Gold" and it's posted at GoldMoney's Internet site here: http://www.goldmoney.com/en-gb/news-and-analysis/news-and-analysis-archi... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT You Don't Have to Wait for Your Monetary Metal: All Pro Gold Has Product for Immediate Delivery 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: The Silver Summit Davenport Hotel, Spokane, Washington Thursday-Friday, October 24-25, 2013 http://www.cambridgehouse.com/event/silver-summit-2013 Mines and Money Australia Melbourne Conference and Exhibition Centre Tuesday, October 29-Friday, November 1, 2013 http://www.minesandmoney.com/ New Orleans Investment Conference Sunday-Wednesday, November 10-13, 2013 Hilton New Orleans Riverside Hotel New Orleans, Louisiana 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: http://gata.org/tshirts 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: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16

Jim’s Mailbox Posted: 18 Oct 2013 01:22 PM PDT Jim, Four things come to mind: 1) JPM in desperate need of cash. A red flag. 2) China seeking alternatives to Treasuries for its USD holdings. 3) JPM deal with China regarding its inability to deliver gold. 4)  Global turmoil on the horizon.  Best to diversify locations. CIGA Name Withheld China’s Largest Conglomerate Buys The... Read more » The post Jim’s Mailbox appeared first on Jim Sinclair's Mineset.

Gene Arensberg: Short-selling banks covering on gold? Posted: 18 Oct 2013 01:10 PM PDT 7:07a AEST Saturday, October 19, 2013 Dear Friend of GATA and Gold: Trading limits go out the window when somebody big wants to send a message in the gold market, the Got Gold Report's Gene Arensberg writes today. His commentary is headlined "Short-Selling Banks Covering on Gold?" and it's posted at the GGR here: http://www.gotgoldreport.com/2013/10/short-selling-banks-covering-on-gol... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. 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: The Silver Summit Davenport Hotel, Spokane, Washington Thursday-Friday, October 24-25, 2013 http://www.cambridgehouse.com/event/silver-summit-2013 Mines and Money Australia Melbourne Conference and Exhibition Centre Tuesday, October 29-Friday, November 1, 2013 http://www.minesandmoney.com/ New Orleans Investment Conference Sunday-Wednesday, November 10-13, 2013 Hilton New Orleans Riverside Hotel New Orleans, Louisiana 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: http://gata.org/tshirts 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: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16

Gold Daily and Silver Weekly Charts - Big Moves In and Out of Comex Bullion Warehouses Posted: 18 Oct 2013 01:10 PM PDT

Gold Daily and Silver Weekly Charts - Big Moves In and Out of Comex Bullion Warehouses Posted: 18 Oct 2013 01:10 PM PDT

Maguire, Sprott interviewed at KWN Posted: 18 Oct 2013 01:01 PM PDT 7a AEST Saturday, October 19, 2013 Dear Friend of GATA and Gold: At King World News, London metals trader Andrew Maguire describes the Federal Reserve's desperate intervention in the gold market to defend the U.S. dollar and China's steady acquisition of discounted metal: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/10/18_M... And Sprott Asset Management CEO Eric Sprott remarks on the catastrophic imbalance in the United States between production and consumption: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/10/18_B... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT Buy metals at GoldMoney and enjoy international storage GoldMoney was established in 2001 by James and Geoff Turk and is safeguarding more than $1.7 billion in metals and currencies. Buy gold, silver, platinum, and palladium from GoldMoney over the Internet and store them in vaults in Canada, Hong Kong, Singapore, Switzerland, and the United Kingdom, ­taking advantage of GoldMoney's low storage rates, among the most competitive in the industry. GoldMoney also offers delivery of 100-gram and 1-kilogram gold bars and 1-kilogram silver bars. To learn more, please visit: http://www.goldmoney.com/?gmrefcode=gata Join GATA here: The Silver Summit Davenport Hotel, Spokane, Washington Thursday-Friday, October 24-25, 2013 http://www.cambridgehouse.com/event/silver-summit-2013 Mines and Money Australia Melbourne Conference and Exhibition Centre Tuesday, October 29-Friday, November 1, 2013 http://www.minesandmoney.com/ New Orleans Investment Conference Sunday-Wednesday, November 10-13, 2013 Hilton New Orleans Riverside Hotel New Orleans, Louisiana 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: http://gata.org/tshirts 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: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT How to profit with silver -- and which stocks to buy now Future Money Trends is offering a special 16-page silver report with our forecast for 2013 that includes profiles of nine companies and technical analysis of their stock performance. Six of the companies have market capitalizations of less than $800 million and one company has a market cap of only $30 million. The most exciting of these companies will begin production in a few weeks and has a market cap of just $150 million. Half of all proceeds from the sale of this report will be donated to the Gold Anti-Trust Action Committee to support its efforts exposing manipulation and fraud in the gold and silver markets. To learn about this report, please visit: http://www.futuremoneytrends.com/index.php?option=com_content&id=376&tmp...

Maguire Predicted Gold Surge – Now Says West Is Collapsing Posted: 18 Oct 2013 12:59 PM PDT Dear CIGAs, On the heels of an explosive mid-week surge in the price of gold and continued weakness in the US dollar, today the man who predicted the massive spike mid-week spike in gold ahead of time warned King World News that the West is now collapsing.  London metals trader Andrew Maguire also spoke with... Read more » The post Maguire Predicted Gold Surge – Now Says West Is Collapsing appeared first on Jim Sinclair's Mineset.

Theater Of The Absurd: Greenspan Writes Book On Economic Forecasting Posted: 18 Oct 2013 12:34 PM PDT Given his track record, Alan Greenspan's publication of a guide to economic forecasting will likely prove as successful as Lance Armstrong's guide to drug-free cycling. As Bloomberg reports, Greenspan's new book "The Map and the Territory" is about as credible as art history by Mr. Magoo; as it pretends to tackle the subject of forecasting while saying next to nothing about the author's historic failure to reduce the risks leading to the crisis, which he calls "almost universally unanticipated." Bloomberg's Daniel Akst sums it up best with his concluding sentence: "'The Map and the Territory' is an infuriating book, one that will leave readers wondering how its author could have come all this way and yet remain so hopelessly lost." Indeed... Via Bloomberg, ...   As Fed chairman until 2006, practically the eve of the financial crisis, Greenspan couldn't see the storm on the horizon.   Despite his mastery of the techniques described at somewhat numbing length in his book, he failed to draw any useful conclusions from a host of indicators that were pointing to trouble.   Omens were plentiful: the bubble in housing prices, the gross inadequacy of banking capital, the systemic risks of money-market funds, the explosive dangers of complex derivatives, the rise of an enormous and poorly regulated shadow banking system, the transparent pandering of the bond-rating companies, the collapse in mortgage-lending standards and the massive overleveraging of U.S. consumers.   ...   "The Map and the Territory" pretends to tackle the subject of forecasting while saying next to nothing about the author's historic failure to reduce the risks leading to the crisis, which he calls "almost universally unanticipated."   ...   Greenspan's plodding text oscillates maddeningly between equivocation and chutzpah. He implies that it was a mistake to bail out the big banks in 2008, yet doesn't say what he would have done instead, leaving us to wonder if, in Ben Bernanke's shoes, he would have let the global financial system go up in flames.   ...   But this is an odd concern from the man whose actions as Fed chief gave rise to faith in the "Greenspan put," the notion that, while he was in office, the central bank would rush to float sinking markets with lower interest rates whenever they faltered.   "The Map and the Territory" is an infuriating book, one that will leave readers wondering how its author could have come all this way and yet remain so hopelessly lost.

Western Credit-Rating Fraud Exposed -- Again Posted: 18 Oct 2013 12:09 PM PDT The "good news" is that the latest Act of "The U.S. Debt-Ceiling Farce" has mercifully ended, and the curtain has come down on this puppet-theater. The bad news is that it ended (absurdly) with a mere three-month reprieve – before we get literally an instant replay of this contrived posturing and puffery. Apart from the outrageous irresponsibility of the U.S.'s elected representatives staging these contrived "crises" (instead of doing their jobs); these quasi "shutdowns" of the U.S. government do serious short-term harm to the already-crippled U.S. economy – meaning medium- and long-term economic consequences from this staged theater. Yet as the dust settles from the latest Act; we see essentially zero reaction in the international financial community (with one, small exception). The world's largest economy, sitting with the largest debts and largest deficits in the History of the World openly "debates" whether or not to continue paying its bills, it ends up (supposedly) only hours away from official debt-default, and there is no reaction? Having regularly used words such as "drones" and "parrots" to characterize the ever-vigilant minions of the Western, Corporate Media; this one event alone provides absolute vindication. During the worst days of the "Euro Debt-Crisis" (so far); European governments received regular downgrades to their sovereign debt on only the flimsiest of pretexts, sometimes due to nothing more than the (fraudulent) manipulation of credit-default swap rates on that debt (i.e. the multi-trillion dollar bets made that these governments will default on that debt). The "insurance market" (credit default swaps) for the debt of many European debtors is greater than the actual debts themselves. The Tail does "wag the Dog" in our crime-ridden financial markets. And by fraudulently manipulating credit-default swap rates; Western banksters can (and do) manufacture downgrades on Euro economies (or vice versa) – and by doing so, they can drive interest rates to literally any number they desire…but they don't do this in the USA. With the U.S. government a mere hours away from debt-default, and sitting with (in actual fact) more than $200 trillion in debts/obligations; the U.S.'s Teflon, "AAA" credit rating remains intact. An economy which the Chairman of the Federal Reserve has now acknowledged is a Ponzi-scheme, retains a carved-in-stone "AAA" credit rating. The obvious question is: would/will the U.S. economy be "downgraded" at all after it defaults on its astronomical debts and liabilities? For those comatose members of the general public who still snicker whenever they see/hear the word "conspiracy"; spend just two minutes observing the Ultimate Accomplices of financial crime: the Western credit-rating agencies. Right up until (literally) the day after the made-in-Wall-Street U.S. housing bubble imploded; these credit rating Accomplices were rubber-stamping virtually all of the Bankster's "securitized" mortgage-fraud products "AAA". This was ratings fraud: ratings agencies selling these (bogus) "AAA" ratings to Wall Street – which those Banksters then used to lure-in chumps for $trillions in securities fraud. And there wasn't even any attempt made to hide the fraud. The ratings agencies openly acknowledged that they allowed their "clients" (the Wall Street Banksters) to tell them how to rate their fraud-products. Not only did these (so-called) "credit rating" agencies not even employ enough staff to thoroughly/properly examine all the "products" on which they issued ratings; they openly acknowledged that they didn't even understand some of the more convoluted Wall Street scams – and so they simply accepted the Bankster's own explanations, essentially allowing them to "rate" their own fraud-products.

Market Monitor – October 18th Posted: 18 Oct 2013 11:58 AM PDT Top Market Stories For October 18th, 2013: The Biggest Scam In The History Of Mankind - Hidden Secrets of Money Episode 4 - Mike Maloney Historical Perspective: The Crisis Last Time - Jesse's Cafe What the Republican Civil War Means For Gold - John Rubino Make A Commitment To Your Finances - Money Talks Federal Reserve Policy Failures Are

Gold-Mining Profits Fallacy Posted: 18 Oct 2013 11:30 AM PDT Gold miners' stocks have been brutalized this year, leaving them bleeding in the gutter as the most hated sector in all the markets. Plunging prices always lead to fear and excessive bearishness, unsustainable anomalous extremes ... Read More...

Gold, Silver, Debt – Don’t Miss These Important Charts Posted: 18 Oct 2013 11:30 AM PDT In this article, contributor Peter De Graaf shows in five charts the long and short term corrections of the gold and silver price. Precious metals remain within their rising trendline, despite the negative sentiment among investors and trader. Moreover, the seriousness of the debt situation and the impact on the dollar “paper currency” is shown in four charts. The debt ceiling in the US being pushed upward for the 79th  time since 1960. Right after the last raise in 2011, the price of gold rose +17% between August 1st ($1620), and August 22nd ($1898) – that was +17% in just three weeks!   A similar reaction by gold at this time could result in price rising quickly from $1281 to $1498. Gold Price Corrections The current correction in gold started in August 2011 and has now gone on for 112 weeks – (it most likely bottomed on June 28th). This has been the longest correction since the current bull market started in 2002. The correction of 2006 lasted 71 weeks before a new high was reached.  There followed then a 50% price rise, (+85% from bottom to the next top). The correction of 2008 took 77 weeks before a new high was reached.  The gold price then advanced by 80%, (+325% from bottom to next top). The expectation is for gold to advance by more than 50% as in 2006-2008, and more than 80% as in 2008-2011 during this next 'leg up', because of the depth of the current pullback.  Because of blatant manipulation of the gold price by large traders dumping oversized lumps of futures contracts during hours when trading is usually sparse; the price of gold is starting this next rally below its normal starting point.   This is likely to cause the price to act in slingshot fashion, and may very well surprise a lot of people. Here is the gold chart that records the beginning of the current bull market, along with three upside breakouts and the expectation for the next breakout, marked by arrows.  (Charts courtesy www.stockcharts.com unless indicated). The RSI (at top of chart) is ready to rise, the CCI (at upper bottom) is rising from oversold conditions, and the A/C line at the lower bottom is still in uptrend after merely leveling out. This chart courtesy Incrementum.li shows us that the current correction in the gold price is not unusual, if we accept the principle that the higher the price, the larger the pullback. Featured is the daily gold chart.  Price is carving out a rising channel that is anchored by two upside reversals (June 28th and Oct 15th).  On Oct. 17th price broke out from beneath three months of resistance, with a target at the 200DMA.  The three supporting indicators have all turned positive, including the Accumulation/Distribution line.  The Gold Direction Indicator (for details www.pdegraaf.com), turned bullish at 55%, compared to 44% on Wednesday. Debt Ceiling, Debt Per Capita, Dollar Inflation This chart courtesy Sharelynx.com shows a gap that has opened up between the US debt limit and the price of gold.  Unless we expect the debt limit to be lowered, (how likely is that), we better prepare our portfolio for a rise in the price of gold, as the rubber band effect takes hold. This chart courtesy BMGBullion.com shows the US Federal Debt on a per capita basis.  This debt cannot be paid off – it will be inflated away.  Gold and silver will be sought as protection against this inflation. This chart courtesy Mark J. Lundeen shows the number of US dollar bills in circulation, compared to the number of ounces of gold supposedly stored at Fort Knox.  (These gold ounces have not been audited since 1953). Silver Price and Silver Corrections Here is the long-term chart for silver, along with the breakout points after a correction takes place, marked with arrows, including the expectation for the next breakout.  The three supporting indicators are beginning to rise up from support levels. Featured is the index that compares silver to gold.  Since the second leg in the double bottoms of 2003 and 2008, the trend has favored silver over gold.  The two supporting indicators are turning positive.  The target for the current bounce is at the top of the blue channel. Featured is the daily bar chart for TIP the bond fund that is indexed for inflation.  Price dropped sharply in May and June when it was thought that the FED might reduce its bond purchases (TIPs are bonds after all).  Recently however the people who buy TIPs are sniffing the first whiffs of price inflation, and the arrows point to breakouts while the supporting indicators are positive.  Price inflation is the delayed result of monetary inflation and a source of energy for gold and silver to rise. Peter Degraaf is an online stocks and bullion trader, with over 50 years of investing experience.  He produces a daily report for his many subscribers, in 17 different countries.  For a sample copy of a recent report contact him at itiswell@cogeco.net or visit his website www.pdegraaf.com. Please do your own due diligence.  Peter Degraaf is not responsible for your trading decisions.

Billionaire Sprott Asks How Will People Survive What’s Coming? Posted: 18 Oct 2013 11:14 AM PDT In the aftermath of the dollar plunge and the gold surge this week, today in his King World News interview billionaire Eric Sprott asked the chilling question, with the collapse that is coming, "as human beings, how is everyone going to survive?" He then stated, "It's a scary prospect." Below is what Sprott, who is Chairman of Sprott Asset Management, had to say in part I of this remarkably powerful interview series. This posting includes an audio/video/photo media file: Download Now

Attention Investors: The Blood is Now in the Streets Posted: 18 Oct 2013 10:11 AM PDT This moment of financial uncertainty, like all those before it, is a golden opportunity for investors with vision to buy emerging disruptive technologies at truly bargain prices. I'm constantly amazed by the sort of sentiment I read in mainstream financial publications. When stocks are down, people decide they're going to sell off and look elsewhere for profits. The market "stinks," they say. Seriously, am I the only person who finds this sort of short-term thinking addled and absurd? After all, we've seen financial cycles since… forever. We know they happen. We know that the best time to buy is when markets are depressed. So why are so many people acting as if the markets are broken? Oh, wait. I know that one. It's because most people are driven more by herd psychology than higher-order thought processes. I've been reminded why I like the Austrian economist Joseph Schumpeter so much. One reason is that he considered big business cycles the inevitable consequence of innovation, as well as the resistance to innovative change that always exists within the old order. If you are waiting for policymakers to solve the market's problems, you're going to be waiting a long time. This view, that cycles cannot be eliminated due to the biological imperative of human nature, sets Schumpeter apart from other economists, even of his own Austrian School. In fact, many of my friends of the Austrian persuasion who adhere more strictly to the banking theories of Mises and Hayek tend to irritate me. They're. So. Whiny. They complain and complain about the stupid things that governments do and the fact that stupid people enable those stupid things… stupidly. So what? If you can't change it, accept it. And profit from it. By this point in history, given that we've suffered through far more serious injuries to our economic system, and more than recovered every time, it should be obvious that human nature is not "repairable." There's not ever going to be some sort of global — or even societal — awakening, in which the vast majority of people suddenly realize that government is basically incapable of improving on free markets to any significant degree. Societies do, however, respond to the pain caused by government-induced failures, just as B.F. Skinner's pigeons learned complex behaviors without ever understanding them. We are, in fact, well on the road to recovery, though I admit that more people are going to have to suffer negative reinforcement (pain) before we are ready to make up for lost time. But we will. I'm sure you know the Chinese curse, "May you live in interesting times." We do, in fact, live in very interesting times. More importantly, we are in a period of historic opportunity, which we may never see again. Stop listening to the whiners. The time to invest is when there's blood in the streets. When your stocks have been doing well for a while and every moron decides that it's time to buy equities, you'll be in positions to "sell high." You can't really do that, however, if you neglect to buy low because you got caught up in the pessimism and lost faith in human ingenuity. This is the same thing John Templeton did it back in 1939. Templeton started his investing career in 1939 by borrowing about $10,000, which was real money in those days. With war escalating in Europe and most investors in panicked despair, he didn't buy gold, nor did he put all his money in Treasuries or other "safe havens." He bought 100 shares in each of the 104 companies priced under a dollar on the New York and American stock exchanges. Almost all were innovative startups, and 34 were in bankruptcy. He then ignored his portfolio for four years. At that point, only four of the 104 were worthless, and he had quadrupled his money. It wasn't luck. Templeton was one of the few who understood portfolio mathematics. It is axiomatic that a diversified portfolio of truly innovative companies held for the long run will pay off big. This is based on the simple assumption that human progress will continue and things will get better. Most people forget that during the Great Depression, there was considerable growth in technological innovation. Necessity created a number of innovations that made our lives better and easier — the laundromat, copy machines, the car radio, the electric shaver and even the cotton tampon all came out of the 1930s. The first nylon material was introduced by DuPont. Improvements in existing technologies like the automobile and airplanes were constantly happening, even as the stock market flat-lined. So at a time when the mainstream was too busy running scared from markets and hiding their money (to the detriment of the rest of the economy), innovative investors like John Templeton were quietly investing in emerging technologies and, over time, making a fortune. Templeton didn't wait for the government or central banks to somehow stimulate us into success like most people then and now. If you are waiting for policymakers to solve the market's problems, you're going to be waiting a long time. There are two kinds of people the world should really be looking to for solutions — scientists and the investors who fund their innovations. Scientists might toil away for years, and investors might sit and wait patiently, but inevitably, as progress is made, there is a payoff — and that payoff can, in some cases, lead to revolutions in entire industries. Schumpeter is the most important economist to investors: He coined a term "creative destruction." If you really want to make money, look not for that which strikes at the margins and outputs of existing firms, but at their very foundations. We are looking for investments that leave ruins behind. Capitalism is the very perennial gale of creative destruction. So if we want to seek out and profit from the real innovations in society, we have to look for technologies that aren't just changing some things, but changing everything. Regards, Patrick Cox for The Daily Reckoning Ed. Note: The kind of investments Patrick refers to aren’t easy to identify. But they’re not impossible. And that’s where people like Patrick come in. They spend their lives poring over research and data trying to find just one gem out of thousands. And a few of these diligent investors are willing to share what they know, so that you can take a shortcut to amazing profits. That’s the kind of news we publish in The Daily Reckoning. That’s the kind of insight readers are provided. And that’s the reason over half a million people check it out every single day. You owe it to yourself to be one of them. Sign up for FREE, right here, and start getting all the info your missing.

The Budget/Debt Ceiling Bill Potentially Eliminates The Debt Ceiling Limit Posted: 18 Oct 2013 09:54 AM PDT Paper money eventually returns to its intrinsic value – zero.  (Voltaire, 1694-1778) Often rather quickly, I might add to that nugget of wisdom.   Unbeknown to most people in this country - and certainly not reported in the mainstream media - is a Provision buried within the Continuing Appropriations Act of 2014 that - in effect - gives the President the ability to unilaterally waive the debt ceiling limit.  Although Congress can override the President's move to get lift the debt ceiling entirely, it would take a 2/3 majority in both Houses of Congress to block the action.  That just would not be possible for all practical purposes. It looks to me, based on reading the Bill, that Harry Reid and Lisa Murkowski, who is on the Appropriations Committee, slipped the Provision into the legislation at a late stage in the game, when they realized that Boehner had caved in and the world was begging the Government to avoid default.  I would bet a lot of money that probably 90% of the Congressmen who voted "yes" on the Bill didn't even know that the Provision was in there.  I can guarantee that as fact. In essence, while most people feel a sense of relief over the passage of the Bill enabling to Government to pile on even more debt, the cold reality is that the legislation is a ticking time bomb for the U.S. dollar and it sets up the next stage of systemic collapse.  I wrote an article for Seeking Alpha which lays out my analysis, which you can read here:  LINK. The truth is, the U.S. political and economic system is now akin to a runaway freight train in which the brakes have failed and it's headed toward a gorge where the bridge has collapsed.

The Key Factor To Drive Gold and Silver Prices to Extreme Values Posted: 18 Oct 2013 09:50 AM PDT The precious metal investors are actually sitting on gold mine, and they don't even know the real reason why this is true.  Many analysts are focusing on the huge amount of debt and fiat money in the system to be invested in gold and silver, but the fundamental root cause continues to go unnoticed. While the massive amount of debt, derivatives and fiat money are indeed excellent reasons to own the precious metals, they are the mere symptoms and not the disease itself.  The advanced societies of the world were built on an economic system that can only survive if it continues to grow.  Without growth, the $100's of trillions in derivatives and debts would implode -- along with it the Suburban Retail-Commercial-Housing economy.

Is the Rising Stock Market Bullish or Bearish News for Gold? Posted: 18 Oct 2013 09:47 AM PDT On Thursday, the S&P 500 closed at a new high and its intraday record of 1733.45 broke the all-time high set Sept. 19. Over 80 percent of stocks traded on the New York Stock Exchange rose. According to FactSet, companies in the ... Read More...

Is Rising Stock Market Bullish or Bearish for Gold? Posted: 18 Oct 2013 09:34 AM PDT On Thursday, the S&P 500 closed at a new high and its intraday record of 1733.45 broke the all-time high set Sept. 19. Over 80 percent of stocks traded on the New York Stock Exchange rose. According to FactSet, companies in the S&P 500 index are on track for third-quarter earnings growth of 1.1% from last year. Excluding J.P. Morgan Chase's loss, they would be on pace for 3.6% growth. Please note that at the beginning of earnings season, analysts expected earnings growth of 3%.

Gold Is A Reserve Of Safety Says ECB President Posted: 18 Oct 2013 09:20 AM PDT Today’s AM fix was USD 1,317.00, EUR 962.09 and GBP 813.16 per ounce. Yesterday’s AM fix was USD 1,308.50, EUR 959.87 and GBP 813.09 per ounce. Gold climbed $40.20 or 3.14% yesterday, closing at $1,319.70/oz. Silver rose $0.53 or 2.49% closing at $21.80. Platinum jumped $44.84 or 3.2% to $1,432.74/oz, while palladium soared $23.50 or 3.3% to $737.50 /oz.

Gold only has one way to go, and that’s up – Hegarty Posted: 18 Oct 2013 09:06 AM PDT Former Rio Tinto executive Owen Hegarty says there is only one way it will go and that is a "north easterly direction over time". Read more….

Kyrgyz crowd attacks Australian gold miner’s office Posted: 18 Oct 2013 09:06 AM PDT A crowd of about 200 people attacked Z-Explorer's local office on Friday, in what appeared to be another violent conflict over the privatisation of the country’s resources. Read more….

Gold shorts "wrongfooted" by US default swerve Posted: 18 Oct 2013 09:05 AM PDT “Gold shorts” who were positioned to profit if gold fell had to close their bets fast as the metal jumped this week, says Societe Generale's Robin Bhar. Read more….

India’s Sept gold jewellery exports rise 16.5% – trade body Posted: 18 Oct 2013 09:05 AM PDT Exports of gold jewellery from India rose 16.5% in value terms to $653.90 million in September, an industry body said Friday. Read more….

Massive sell/buy orders create huge gold market instability Posted: 18 Oct 2013 09:05 AM PDT Massive daily paper gold trades are responsible for moving the gold market upwards or downwards (mostly the latter) virtually every day now creating major instability in the gold markets. Read more….

Silver Prices and the Flow of Physical Posted: 18 Oct 2013 08:43 AM PDT The ultimate lynch pin for the silver market is the flow of physical metal to support ongoing price suppression. The flow of physical metal is mostly an illusion nearly equal to (and in some ways parallel with) the perceived strength of the paper currencies used to measure its value. Actual or threat of default in physical silver delivery to the COMEX could very likely lead to default across the asset spectrum.

Maguire Predicted Gold Surge - Now Says West Is Collapsing Posted: 18 Oct 2013 08:41 AM PDT On the heels of an explosive mid-week surge in the price of gold and continued weakness in the US dollar, today the man who predicted the massive spike mid-week spike in gold ahead of time warned King World News the West is now collapsing. London metals trader Andrew Maguire also spoke with KWN about what people should expect to see next in the gold market. Below is what Maguire had to say in this tremendous and timely interview. This posting includes an audio/video/photo media file: Download Now

What the Republican Civil War Means For Gold Posted: 18 Oct 2013 08:22 AM PDT In one sense, the past couple of weeks' debt ceiling debate was just one more in a long line of annoying-but-otherwise-pointless pieces of bad political theater. But in another sense it was a turning point, one that may have put ... Read More...

Why You Should Triple-Check the Ticker Before Buying That Stock Posted: 18 Oct 2013 07:49 AM PDT Dear Reader, A simple misplaced letter can make a world of difference. Two weeks ago, on an otherwise quiet Friday, voracious investors piled into the most anticipated tech IPO since Facebook. Buyers bought over 14 million shares of social media giant Twitter, sending its price soaring over 1,000%. Or so they thought. Twitter's shares aren't public. The company doesn't IPO until November. Instead of buying shares in Twitter, these twits were unknowingly throwing money at penny-stock Tweeter, which trades under the symbol TWTRQ. Similar to Twitter's proposed ticker of TWTR, but not the same. That "Q" changes everything. Tweeter, if you're wondering, is a bankrupt Boston-based electronics retail chain. There's a decent chance your house is worth more than the entire company, about $600,000. Twitter, of course, is a social media powerhouse sporting 218 million users and a valuation of $15 billion. How investors could confuse the two is a mystery. To me, the only possible explanation is that a human brain was not part of the equation. I don't know about you, but I never buy a stock without triple-checking that I have the right one. This incident has "algorithm" written all over it. It seems the culprit was a computer program designed to speed-read the news and then trade based on its findings. The day before the incident, Twitter filed its IPO paperwork, a prerequisite to executing its IPO. An algorithm must have read a news article, observed "Twitter" and "IPO" in the same sentence, and gone on a misdirected shopping spree. This one episode is enough for a chuckle, but it happened again a few days later. This time, TW Telecom, which trades under the ticker TWTC, soared from $30 to $300 in a matter of seconds, apparently for the same reason. Nasdaq cancelled the trades, saying the transactions were "clearly erroneous." Social Media Frenzy Investors sure are antsy to start trading Twitter stock. No wonder: social media is red hot. I just got a marketing email this morning touting the track record of "the only Social Media ETF," ticker: SOCL. Apparently, it has outperformed the S&P 500 threefold in 2013. That's quite an accomplishment given that the S&P 500 has risen a handsome 20% itself in 2013. And take a look at a few of the individual social media companies. Facebook, having fully recovered from its disastrous IPO in the spring of 2012, has doubled in the past three months and is trading at its all-time high. LinkedIn is just a hair below its all-time high. Groupon, the comparative laggard, is "only" near its 16-month high. What's the driver here? It sure as heck isn't fundamentals. Facebook sports a P/E ratio of 211x, and LinkedIn 646x. Groupon's is infinity, because it's losing money. Yet it's worth about $8 billion. Those nosebleed valuations would make the dot-com era darlings jealous. Now, all three of these companies are in the earlier stages of learning how to monetize their massive user bases. I'm sure their potential is breathtaking if they can execute. But that's a big if. Remember what happened the last time investors ascribed triple-digit P/E ratios based on potential alone? Every company with "e" in front of its name (eToys) or ".com" behind (pets.com) soared, only to leave investors broke when the dot-com bubble popped. Even the survivors of that era that eventually transformed into tech powerhouses struggled. Amazon, an amazing company that seems to offer the best price on every legal product known to man, lost 93% of its value during the dot-com bubble. It eventually recovered to surpass its old all-time highs, but it took a decade to get there. Recently, it's been delighting shareholders with strong performance (including BIG TECH subscribers, who cashed out of Amazon with a cool 49% gain earlier this year). But the road to success was neither easy nor short. Amazon's success tells us that meeting sky-high expectations is possible. I don't doubt that one or two of the very best social media companies will realize their eye-popping potential. Eventually. But it's a long journey to that point, full of unpredictable obstacles. Just like Amazon's stock chart, the path to success won't be a straight line. That being the case, if you want to jump on the social media bandwagon, do your bank account a favor and bide your time until sober reality sets in. Wait until the bandwagon has broken down on the side of the road, with two flat tires and dejected passengers lamenting, "Darn it, it happened again. I was SURE this time was different." You'll know it's that time when P/E ratios are in the low teens. That's when you want to invest in these companies. Not when they're riding high on dreams of the future. And if you want help in that endeavor, consider a subscription to BIG TECH or Casey Extraordinary Technology. Our Tech analyst team pride themselves on separating hype from results, and only invest in companies that are poised to deliver big returns to subscribers now, not in five years. Their track record is nothing short of astonishing, with a 42.9% average gain per investment. In other words, they don't just beat the market, they crush it. Click here for a 100% risk-free trial to Casey Extraordinary Technology, and you'll also get a subscription to large-cap-focused BIG TECH absolutely free. Speaking of beating the market, one of the three fellows who just won the Nobel Prize in economics, Eugene Fama, built his work on the notion that beating the market on a consistent basis is impossible. Not that a Nobel Prize of any sort means much anymore. Ever since Obama won the Nobel Peace Prize, it's become sort of a punch line. As far as I can tell, his qualifications for winning began and ended with the fact that he was not President Bush. Also, I'd like to think that if I were the giver of the Nobel Peace Prize, I would've rescinded it after the man I bestowed it upon began sending miniature unmanned aircrafts of death to rain hellfire upon innocent foreigners… which seems like a decidedly un-peaceful activity. Anyway, I'll now step aside and let Doug French take the stage to explain said Nobel winner's worldview, and how it stands up to centuries of evidence. (Hint: it doesn't). Nobel Prize Winner: Bubbles Don’t Exist Doug French, No wonder investors don't take economists seriously. Or if they do, they shouldn't. Since Richard Nixon interrupted Hoss and Little Joe on a Sunday night in August 1971, it's been one boom and bust after another. But don't tell that to the latest Nobel Prize co-winner, Eugene Fama, the founder of the efficient-market hypothesis. The efficient-market hypothesis asserts that financial markets are "informationally efficient," claiming one cannot consistently achieve returns in excess of average market returns on a risk-adjusted basis. "Fama's research at the end of the 1960s and the beginning of the 1970s showed how incredibly difficult it is to beat the market, and how incredibly difficult it is to predict how share prices will develop in a day's or a week's time," said Peter Englund, secretary of the committee that awards the Nobel Prize in Economic Sciences. "That shows that there is no point for the common person to get involved in share analysis. It's much better to invest in a broadly composed portfolio of shares." Fama is not just a Nobel laureate. He also co-authored the textbook, The Theory of Finance, with another Nobel winner, Merton H. Miller. He won the 2005 Deutsche Bank Prize in Financial Economics as well as the 2008 Morgan Stanley-American Finance Association Award. He is seriously a big deal in the economics world. So if Fama has it right, investors should just throw in the towel, shove their money into index funds, and blissfully wait until they need the money. Before you do that, read what Fama had to say about the 2008 financial crisis. The New Yorker's John Cassidy asked Fama how he thought the efficient-market hypothesis had held up during the recent financial crisis. The new Nobel laureate responded: "I think it did quite well in this episode. Prices started to decline in advance of when people recognized that it was a recession and then continued to decline. There was nothing unusual about that. That was exactly what you would expect if markets were efficient." When Cassidy mentioned the credit bubble that led to the housing bubble and ultimate bust, the famed professor said: "I don't even know what that means. People who get credit have to get it from somewhere. Does a credit bubble mean that people save too much during that period? I don't know what a credit bubble means. I don't even know what a bubble means. These words have become popular. I don't think they have any meaning." No matter the facts, Fama has his story and he's sticking to it. "I think most bubbles are 20/20 hindsight," Fama told Cassidy. When asked to clarify whether he thought bubbles could exist, Fama answered, "They have to be predictable phenomena." The rest of us, who lived through the tech and real estate booms while Fama was locked in his ivory tower, know that in a boom people go crazy. There's a reason the other term for bubble is mania. According to Webster's, "mania" is defined in an individual as an "excitement of psychotic proportions manifested by mental and physical hyperactivity, disorganization of behavior, and elevation of mood." Financial bubbles have occurred for centuries. In January 1637, the price of the common Witte Croonen tulip bulb rose 26 times, only to crash to 1/20th of its peak price a week later. Eighty years later in France, John Law flooded the French economy with paper money and shares of the Mississippi Company. The public went wild for stock in a company that had no real assets. The shares rose twentyfold in a year, only to crash. Law, a hero in the boom, was run out of France in disgrace. At the same time across the channel, the British public bid up South Sea Company shares from ₤300 to ₤1,000 in a matter of weeks. Even the brilliant Sir Isaac Newton was caught up in the frenzy. He got in early and sold early. But he then jumped back in near the top and went broke in the crash. In the modern era, booms and busts are too numerous to count: Japanese stocks and property, real estate (multiple times), stocks, commodities, stocks again, farmland (multiple times), and art are just a few. Yet the newest co-Nobelist denies the existence of booms and busts and advises you to put your money in index funds and hope for the best. However, investor returns have not been the best. The last complete calendar decade for stocks ending in 2009 was the worst in history. The Wall Street Journal reported, "Since the end of 1999, stocks traded on the New York Stock Exchange have lost an average of 0.5% a year thanks to the twin bear markets this decade." When you adjust that for inflation, the results were even worse, with the S&P 500 losing an average of 3.3% per year. This decade, stocks have been on a tear—as have bonds, farmland, and art. At first glance, it's nonsensical that the price of virtually everything is rising. But when you remember that the Federal Reserve's cheap money has flooded Wall Street but hasn't come close to Main Street, it becomes clear. The money has to go somewhere. If Fama were correct, there would be no legendary investors like Doug Casey or Rick Rule. There would be no opportunities for ten-baggers and twenty-baggers in resource stocks. Fama is like the economist in the old joke who sees a hundred-dollar bill on the ground but doesn't pick it up. "Why didn't you pick it up?" a friend asks. The economist replies, "It's impossible—a hundred-dollar bill would have already been picked up by now." Of course subscribers to publications like The Casey Report know there are hundred-dollar bills to be picked up in the market. With tax-selling season upon us, now is the time to be shopping for bargains. Doug's friend Rick Rule often says, "You can either be a contrarian or a victim." Taking Fama's advice will make you a victim. The path to wealth is to run against the herd, not with it. Dan again. I've got one more article for you today, this one by Aaron Bedrick, our energy-trading correspondent and technical analyst for The Casey Report. He explains what strange movements in the price of oil tell us about oil and gasoline's probable course for the remainder of this year. This Week at the NYMEX By Aaron Bedrick "Want to know the easiest trade on the board? Sell Dec 13 versus Dec 14 over $4.00. I banked $10K on it last month. Always makes money." I overheard this statement at the NYMEX near the beginning of 2013, followed by self-satisfied slaps on the back all around. Everyone knew this trade was a slam dunk. The idea behind the trade is simple: usually, buyers are willing to pay more for a commodity in the future than at present, because by delaying delivery, they can pay less in storage costs. Thus December 2014 crude should cost the same or more than December 2013 crude. When the spread inverts, traders pounce on what they perceive to be easy money. Whoops. Unfortunately, turmoil in the Middle East spurred large traders to hedge themselves by buying the most liquid contract on the board, December 2013 crude. This caused the spread to explode in the wrong direction, to over $14.00. This chart illustrates the spread: lower is good, higher is bad. Those positions were slaughtered. Each contract lost $10,000, and I know some traders who had more than 20 contracts each. That's $200,000 down the drain, bad enough to end a few of my colleagues' careers. Though the damage is already done, the spread topped out in September and is reverting back to normal. Traders, with their notoriously short attention spans, have already forgotten about Middle East supply concerns and have turned their attention to a new story: lackadaisical demand in the domestic market. If the chatter I'm hearing is correct, look for subdued US demand to keep a lid on both oil and gasoline prices for the remainder of 2013. Unless we get a seriously disruptive event, neither has much upside potential for the rest of this year. Friday Funnies A fellow walked into a bank in New York City asking for a loan of $4,000. "Well, before we lend you the money, we are going to need some kind of security," the bank teller said. "No problem," the man responded. "Here are the keys to my car. You'll see it, it's a black Porsche parked in the back of the parking lot." A few weeks later the man returned to pay off his loan. While he was paying it up, along with the interest of $11, the manager came over, "Sir, we are very happy to have your business, but if you don't mind me asking, after you left we looked into your background and found out that you are a millionaire. Why would you need to borrow $4,000?" "Well," the fellow responded, "it's quite simple; where else can I park my car for three weeks in New York for $11?" -- An old man went to the doctor complaining of a terrible pain in his leg. "I am afraid it's just old age," replied the doctor, "there is nothing we can do about it." "That can't be," fumed the old man, "you don't know what you're doing." "How can you possibly know I am wrong?" countered the doctor. "Well, it's quite obvious," the old man replied. "My other leg is fine, and it's the exact same age!" -- Larry was a photographer for the New York Times, and was scheduled to meet a plane on the runway to take him on a job. "Hit it," said Larry climbing into the first plane he saw on the runway. The pilot took off and was soon in the air. "OK," said Larry, "fly low over the trees over there, I want to take a few pictures." "What do you mean?" asked the pilot. Larry looked at the pilot and answered a little annoyed, "I need to take some pictures for the New York Times, so please…" There was a long pause, before the pilot asked in a shaky voice, "You mean you're not my pilot instructor?" That's It for This Week As I sign off, I note that gold had a fantastic Thursday, soaring $37 on news that the government shutdown is over and the debt ceiling will be suspended. Furloughed government employees also had a fantastic day, as they were informed that they'll receive full back pay for the two weeks of work they didn't do. Who doesn't love a spontaneous paid vacation? Judging from the early news reports, we can look forward to round 3 of the debt ceiling circus in four short months. The compromise that Congress struck does not lift the debt ceiling, it only suspends it until February 7. If Congress can't make some "tough decisions" to cut spending before then, we're headed for another shutdown. Maybe they should start with the $3.3 billion of pork spending they shoved into the bill at the last minute. With that, I'll leave you to enjoy your weekend. Thanks for being a Casey Research subscriber! Dan Steinhart Managing Editor of The Casey Report

Italy's Gold Sector: Decline & Fall Posted: 18 Oct 2013 07:45 AM PDT Once-dominant gold jewelry exports point to Italy's deeper malaise...   "ITALY accused of protectionism!" is hardly news, writes Alessandra Pilloni at Bullionvault Italia.   Wanting free competition in the airline market, IAG – the group formed from the UK's privatized British Airways and Spain's privatized Iberia in 2012 – has urged the European Commission to investigate and block the possible rescue of Italy's bankrupt Alitalia by the state-owned Italian Post Office. This tells a story all too familiar in Italy – the lack of a reality check, or any market discipline, for companies who are struggling to remain competitive in today's global economy.   Competitiveness? It's unknown, a taboo word in Italy, as the Wall Street Journal notes. Prime minister Enrico Letta, meeting the country's "political and business elites" on the shores of Lake Como after defeating Silvio Berlusconi at the start of this month, shocked nobody by not daring to utter the forbidden word once.   Competitiveness? How vulgar!   The crisis in Italy's gold industry is emblematic in this regard. After peaking in the late 1990s, the jewelry industry entered a deep crisis. This crisis may have bottomed out during 2012, but this year's slight improvement still needs to be borne out by the data.   Yes, the gold jewelry sector is Italy's sixth largest provider of positive trade flows. As much as 70% of its output is destined for international markets, according to data from gold industry federation, Confindustria Federorafi. So it remains a crucial area.   But the gold sector in Italy has shrunk dramatically over the last 15 years, as a report presented earlier this month in Rome at the 14th Conference of the London Bullion Market Association showed. Produced by MetalsFocus and Metallis Consulting, two independent consulting agencies based in London, the report highlights how Italy's annual gold manufacturing declined 80% by weight between 1998 and 2012.   How could an industry so integral to Italy's self-image get beaten up so badly?   At the end of the 1990s, Italy was among the largest manufacturers of gold jewelry in the world, and the largest in Europe. Meeting 10% of global demand, Italy's goldsmiths worked metal weighing more than 500 tonnes per year.   The year 1998 marked the peak for finished gold exports from Italy. Production reached 540 tonnes, of which 420 were for export, mainly to Europe and North America. That same year, domestic demand reached above 112 tonnes, a level considered to be stable after the peak achieved in 1992. In 2012, in contrast, a mere 62 tonnes were produced for export according to MetalsFocus and Metallis, less than 15% of the volumes reported 15 years before. At home, Italy's domestic market for gold jewelry is estimated to have shrunk by three quarters.   Now, it must be said that this decline in Italy's own jewelry demand is consistent with other Western countries, meaning the rest of Europe and the United States. These two areas were also the favored destinations for exports of gold products from Italy. In combination they constituted two-thirds of Italy's total gold exports. And as the MetalsFocus/Metallis report explains, the decline in demand was caused by several structural changes in the market, including the rising gold price (up six-fold in Dollar, Sterling and Euro terms), competition from other consumer goods (especially hi-tech gadgets), and of course the economic crisis starting in 2007.   The global financial crisis has caused a bifurcation in gold jewelry demand worldwide. At one end consumption has become concentrated amongst the luxury-loving uber-rich on the highest quality items (and hence the highest mark-ups for workmanship). At the other, lower-income consumers now favor lower-cost items, with strong substitution of steel, leather and ceramics for gold and other precious metals.   In total, as a result, annual gold jewelry demand in Western countries was 600 tonnes lower in 2012 than in 1998. So Italy's once-booming gold sector already faced problems. But so did everyone else. And faced with this major decline in Western demand, Italy proved itself uniquely inadequate in terms of competitiveness, losing much of its share in those declining markets.   In 2000 Italy met 40% of Western gold jewelry consumption. By 2012 it met only 10%. As shown in the graph below, Italian gold imports constituted a third of the US market at the turn of the century. That share has shrunk by more than 60%, replaced mostly by products from China, Hong Kong and India.  One mitigating factor: Italy was penalized in trade with the United States by import duties of 6% on gold jewelry. That handicap does not exist for its key competitors. This September, Stefano De Pascale, director of Federorafi, said at the Vicenza Fair that he's calling for a bilateral agreement with the US. "If the trade barriers were removed, our exports would immediately jump 20 percent," he said to Reuters.   So the export industry is starting to fight back. But is it too late? Staying competitive over the last 15 years would now mean gold sector exports of 100-120 tonnes per year, the new report estimates. That would equal nearly 200% against the 62 tonnes exported in 2012, according to BullionVault calculations.   What's more, the causes of Italy's declining gold sector may not entirely be in its hands. Note that the beginning of the end came with the turn of the new millennium, which also marked the change of currency from the Lira to the Euro. Deprived of the systematic help given by a weak currency, Italy's gold exports aren't alone in plunging as the single currency union took hold. Competitive devaluation was a classic economic strategy for Italian governments. It has been closed since 2000.   Let me be clear – it is not my intention to talk down the gold sector in Italy, which has done and continues to do much for the Italian economy. But the fact that this sector of excellence has not been able to keep pace with the evolution of the global market it once led proves how much work there is to do in reviving the Italian economy.   The global market is a tough place. But remaining blind to its challenges will not provide a solution. Shackled by the Euro, Italy's export sectors needed to adapt more quickly, embracing the healthy climate of competitiveness which the single market imposed. Once again however, Italy seems genetically incapable of responding as shown by the Alitalia affair.

Italy's Gold Sector: Decline & Fall Posted: 18 Oct 2013 07:45 AM PDT Once-dominant gold jewelry exports point to Italy's deeper malaise...   "ITALY accused of protectionism!" is hardly news, writes Alessandra Pilloni at Bullionvault Italia.   Wanting free competition in the airline market, IAG – the group formed from the UK's privatized British Airways and Spain's privatized Iberia in 2012 – has urged the European Commission to investigate and block the possible rescue of Italy's bankrupt Alitalia by the state-owned Italian Post Office. This tells a story all too familiar in Italy – the lack of a reality check, or any market discipline, for companies who are struggling to remain competitive in today's global economy.   Competitiveness? It's unknown, a taboo word in Italy, as the Wall Street Journal notes. Prime minister Enrico Letta, meeting the country's "political and business elites" on the shores of Lake Como after defeating Silvio Berlusconi at the start of this month, shocked nobody by not daring to utter the forbidden word once.   Competitiveness? How vulgar!   The crisis in Italy's gold industry is emblematic in this regard. After peaking in the late 1990s, the jewelry industry entered a deep crisis. This crisis may have bottomed out during 2012, but this year's slight improvement still needs to be borne out by the data.   Yes, the gold jewelry sector is Italy's sixth largest provider of positive trade flows. As much as 70% of its output is destined for international markets, according to data from gold industry federation, Confindustria Federorafi. So it remains a crucial area.   But the gold sector in Italy has shrunk dramatically over the last 15 years, as a report presented earlier this month in Rome at the 14th Conference of the London Bullion Market Association showed. Produced by MetalsFocus and Metallis Consulting, two independent consulting agencies based in London, the report highlights how Italy's annual gold manufacturing declined 80% by weight between 1998 and 2012.   How could an industry so integral to Italy's self-image get beaten up so badly?   At the end of the 1990s, Italy was among the largest manufacturers of gold jewelry in the world, and the largest in Europe. Meeting 10% of global demand, Italy's goldsmiths worked metal weighing more than 500 tonnes per year.   The year 1998 marked the peak for finished gold exports from Italy. Production reached 540 tonnes, of which 420 were for export, mainly to Europe and North America. That same year, domestic demand reached above 112 tonnes, a level considered to be stable after the peak achieved in 1992. In 2012, in contrast, a mere 62 tonnes were produced for export according to MetalsFocus and Metallis, less than 15% of the volumes reported 15 years before. At home, Italy's domestic market for gold jewelry is estimated to have shrunk by three quarters.   Now, it must be said that this decline in Italy's own jewelry demand is consistent with other Western countries, meaning the rest of Europe and the United States. These two areas were also the favored destinations for exports of gold products from Italy. In combination they constituted two-thirds of Italy's total gold exports. And as the MetalsFocus/Metallis report explains, the decline in demand was caused by several structural changes in the market, including the rising gold price (up six-fold in Dollar, Sterling and Euro terms), competition from other consumer goods (especially hi-tech gadgets), and of course the economic crisis starting in 2007.   The global financial crisis has caused a bifurcation in gold jewelry demand worldwide. At one end consumption has become concentrated amongst the luxury-loving uber-rich on the highest quality items (and hence the highest mark-ups for workmanship). At the other, lower-income consumers now favor lower-cost items, with strong substitution of steel, leather and ceramics for gold and other precious metals.   In total, as a result, annual gold jewelry demand in Western countries was 600 tonnes lower in 2012 than in 1998. So Italy's once-booming gold sector already faced problems. But so did everyone else. And faced with this major decline in Western demand, Italy proved itself uniquely inadequate in terms of competitiveness, losing much of its share in those declining markets.   In 2000 Italy met 40% of Western gold jewelry consumption. By 2012 it met only 10%. As shown in the graph below, Italian gold imports constituted a third of the US market at the turn of the century. That share has shrunk by more than 60%, replaced mostly by products from China, Hong Kong and India.  One mitigating factor: Italy was penalized in trade with the United States by import duties of 6% on gold jewelry. That handicap does not exist for its key competitors. This September, Stefano De Pascale, director of Federorafi, said at the Vicenza Fair that he's calling for a bilateral agreement with the US. "If the trade barriers were removed, our exports would immediately jump 20 percent," he said to Reuters.   So the export industry is starting to fight back. But is it too late? Staying competitive over the last 15 years would now mean gold sector exports of 100-120 tonnes per year, the new report estimates. That would equal nearly 200% against the 62 tonnes exported in 2012, according to BullionVault calculations.   What's more, the causes of Italy's declining gold sector may not entirely be in its hands. Note that the beginning of the end came with the turn of the new millennium, which also marked the change of currency from the Lira to the Euro. Deprived of the systematic help given by a weak currency, Italy's gold exports aren't alone in plunging as the single currency union took hold. Competitive devaluation was a classic economic strategy for Italian governments. It has been closed since 2000.   Let me be clear – it is not my intention to talk down the gold sector in Italy, which has done and continues to do much for the Italian economy. But the fact that this sector of excellence has not been able to keep pace with the evolution of the global market it once led proves how much work there is to do in reviving the Italian economy.   The global market is a tough place. But remaining blind to its challenges will not provide a solution. Shackled by the Euro, Italy's export sectors needed to adapt more quickly, embracing the healthy climate of competitiveness which the single market imposed. Once again however, Italy seems genetically incapable of responding as shown by the Alitalia affair.

Italy's Gold Sector: Decline & Fall Posted: 18 Oct 2013 07:45 AM PDT Once-dominant gold jewelry exports point to Italy's deeper malaise...   "ITALY accused of protectionism!" is hardly news, writes Alessandra Pilloni at Bullionvault Italia.   Wanting free competition in the airline market, IAG – the group formed from the UK's privatized British Airways and Spain's privatized Iberia in 2012 – has urged the European Commission to investigate and block the possible rescue of Italy's bankrupt Alitalia by the state-owned Italian Post Office. This tells a story all too familiar in Italy – the lack of a reality check, or any market discipline, for companies who are struggling to remain competitive in today's global economy.   Competitiveness? It's unknown, a taboo word in Italy, as the Wall Street Journal notes. Prime minister Enrico Letta, meeting the country's "political and business elites" on the shores of Lake Como after defeating Silvio Berlusconi at the start of this month, shocked nobody by not daring to utter the forbidden word once.   Competitiveness? How vulgar!   The crisis in Italy's gold industry is emblematic in this regard. After peaking in the late 1990s, the jewelry industry entered a deep crisis. This crisis may have bottomed out during 2012, but this year's slight improvement still needs to be borne out by the data.   Yes, the gold jewelry sector is Italy's sixth largest provider of positive trade flows. As much as 70% of its output is destined for international markets, according to data from gold industry federation, Confindustria Federorafi. So it remains a crucial area.   But the gold sector in Italy has shrunk dramatically over the last 15 years, as a report presented earlier this month in Rome at the 14th Conference of the London Bullion Market Association showed. Produced by MetalsFocus and Metallis Consulting, two independent consulting agencies based in London, the report highlights how Italy's annual gold manufacturing declined 80% by weight between 1998 and 2012.   How could an industry so integral to Italy's self-image get beaten up so badly?   At the end of the 1990s, Italy was among the largest manufacturers of gold jewelry in the world, and the largest in Europe. Meeting 10% of global demand, Italy's goldsmiths worked metal weighing more than 500 tonnes per year.   The year 1998 marked the peak for finished gold exports from Italy. Production reached 540 tonnes, of which 420 were for export, mainly to Europe and North America. That same year, domestic demand reached above 112 tonnes, a level considered to be stable after the peak achieved in 1992. In 2012, in contrast, a mere 62 tonnes were produced for export according to MetalsFocus and Metallis, less than 15% of the volumes reported 15 years before. At home, Italy's domestic market for gold jewelry is estimated to have shrunk by three quarters.   Now, it must be said that this decline in Italy's own jewelry demand is consistent with other Western countries, meaning the rest of Europe and the United States. These two areas were also the favored destinations for exports of gold products from Italy. In combination they constituted two-thirds of Italy's total gold exports. And as the MetalsFocus/Metallis report explains, the decline in demand was caused by several structural changes in the market, including the rising gold price (up six-fold in Dollar, Sterling and Euro terms), competition from other consumer goods (especially hi-tech gadgets), and of course the economic crisis starting in 2007.   The global financial crisis has caused a bifurcation in gold jewelry demand worldwide. At one end consumption has become concentrated amongst the luxury-loving uber-rich on the highest quality items (and hence the highest mark-ups for workmanship). At the other, lower-income consumers now favor lower-cost items, with strong substitution of steel, leather and ceramics for gold and other precious metals.   In total, as a result, annual gold jewelry demand in Western countries was 600 tonnes lower in 2012 than in 1998. So Italy's once-booming gold sector already faced problems. But so did everyone else. And faced with this major decline in Western demand, Italy proved itself uniquely inadequate in terms of competitiveness, losing much of its share in those declining markets.   In 2000 Italy met 40% of Western gold jewelry consumption. By 2012 it met only 10%. As shown in the graph below, Italian gold imports constituted a third of the US market at the turn of the century. That share has shrunk by more than 60%, replaced mostly by products from China, Hong Kong and India.  One mitigating factor: Italy was penalized in trade with the United States by import duties of 6% on gold jewelry. That handicap does not exist for its key competitors. This September, Stefano De Pascale, director of Federorafi, said at the Vicenza Fair that he's calling for a bilateral agreement with the US. "If the trade barriers were removed, our exports would immediately jump 20 percent," he said to Reuters.   So the export industry is starting to fight back. But is it too late? Staying competitive over the last 15 years would now mean gold sector exports of 100-120 tonnes per year, the new report estimates. That would equal nearly 200% against the 62 tonnes exported in 2012, according to BullionVault calculations.   What's more, the causes of Italy's declining gold sector may not entirely be in its hands. Note that the beginning of the end came with the turn of the new millennium, which also marked the change of currency from the Lira to the Euro. Deprived of the systematic help given by a weak currency, Italy's gold exports aren't alone in plunging as the single currency union took hold. Competitive devaluation was a classic economic strategy for Italian governments. It has been closed since 2000.   Let me be clear – it is not my intention to talk down the gold sector in Italy, which has done and continues to do much for the Italian economy. But the fact that this sector of excellence has not been able to keep pace with the evolution of the global market it once led proves how much work there is to do in reviving the Italian economy.   The global market is a tough place. But remaining blind to its challenges will not provide a solution. Shackled by the Euro, Italy's export sectors needed to adapt more quickly, embracing the healthy climate of competitiveness which the single market imposed. Once again however, Italy seems genetically incapable of responding as shown by the Alitalia affair.

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