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Wednesday, October 16, 2013

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Confusion over mine permitting 'rejection' in Spain

Posted: 16 Oct 2013 07:26 PM PDT

Edgewater Resources was in damage control mode after headlines in Spain suggest its gold project had been rejected.

Gold prices jump 2.9% from 3-month lows

Posted: 16 Oct 2013 05:05 PM PDT

With gold rallying 2.9% at one point from yesterday's sudden 3-month low, world stock markets slipped.

Canada’s Northwest Territories seeks to raise debt ceiling

Posted: 16 Oct 2013 03:13 PM PDT

The territory says it needs more borrowing to fund a hydro-electric grid expansion to link remote diamond, gold and rare-earth mines.

This could be your only legitimate chance to turn a tiny $99 investment into life-changing money

Posted: 16 Oct 2013 01:22 PM PDT

From Jeff Clark in Growth Stock Wire:
 
In today's essay, I'm doing something I don't normally do...
 
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As a trader, research is everything. You're only as good as your ideas. And your ideas are only as good as the research that goes into them.
 
I spent more than 20 years in the stock brokerage industry. During that time, I subscribed to dozens of newsletters... I paid for some of the most expensive research on Wall Street. I'm telling you... the best stuff came from Stansberry & Associates.
 
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It might sound odd if you've never used this approach, but their fundamental stock research is some of the most useful option-trading material you can get anywhere, for any price.
 
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More from Stansberry Research:
 
 
 

More Federal Reserve Failure – Graphically!

Posted: 16 Oct 2013 01:00 PM PDT

Over the years, whenever I'm asked if the CFTC will crack down on gold and silver manipulation, my answer has unwaveringly been the same – NOT A CHANCE.  My reasoning is as simple as can be; that is, the government's steadfast goal of maintaining the status quo – no matter how many suffer as a result – will NEVER be ended by a self-inflicted gunshot.  After all, the CFTC is a government agency; and thus, why would anyone expect it to contradict government plans?

The same goes for the government at large; which care of a recently successful "policy" of MONEY PRINTING, MARKET MANIPULATION, and PROPAGANDA, actually believes it can "sustain the unsustainable" indefinitely.  In their eyes, if they can convince people a higher stock market signifies imminent "recovery," the masses will continue to listen to their lies; no matter how much they contradict REALITY.  Similar efforts have been attempted throughout history, and ALL have failed.  It will be no different this time around – no matter how many derivatives are utilized.

Using such tools, they create "straw men" to tear down; such as the meme that stocks are terrified of government shutdowns and debt ceiling impasses, whilst Precious Metals "love" them.  The fact the Dow Jones Propaganda Average sits just below its all-time high (not adjusted for inflation or survivor bias, of course), while gold and silver have already been torched, is immaterial when preaching to a population resigned to misery, which cares only when its next EBT card will be filled.  Not that they really care in the first place; as aside from those actually on furlough, few have any clue what the "government shutdown" or "debt ceiling" mean.

And sadly, the same goes for Europeans; who given their sorry, sordid history of war, corruption, and inflation, should know better.  Then again, they too are living a hopeless existence where "1%" owns everything, and the rest rely on them for survival.  That said, how ANYONE can believe rising European stocks are indicative of ANYTHING other than "intervention" is beyond me.  Spain's IBEX index, for instance, has nearly doubled in the past year; despite a PMI business activity index below 50 until this month, when it barely turned positive.  GDP remains negative, unemployment at an ALL-TIME HIGH; and per below, home prices and bank loans remain in FREEFALL.

Spain House Prices

Remember, when Spain's banking sector was bailed out with €100 billion of freshly printed ECB money last summer, it was the morbid housing sector that was its main cause.  Fast forward to today – when the housing market is in MUCH worse shape; yet, we're to believe a freely-traded stock market is nearly twice the price?  Even the ECB admits the banking sector is in trouble; and yet, such a catastrophe has been largely ignored by the MSM.  The same goes for Greece, which yet again is on the verge of another bailout; and, for that matter, the United States of Fraud – where yet another bank, in this case Bank of America – reported "earnings" so fraudulent, they're an utter embarrassment; i.e., another blaring signal for the rest of the world to SELL, SELL, SELL dollar-denominated assets.

Back to my point, the odds of the game ending with the U.S. government shutting itself down are practically ZERO, in my opinion.  And no, I'm not speaking of the past two weeks faux shutdown – in which roughly 90% of government jobs were unscathed, under the guise of being "essential" to national security; but instead, a real shutdown triggered by failure to raise the debt limit.  Not to mention, the associated default on U.S. Treasury bonds – which theoretically, is impossible given the Fed's unlimited printing press capability.  In other words, there is NO WAY a tiny group of 536 people – who rely on public confidence to keep their jobs – would allow a generational tragedy to occur due to procedural squabbling.  And not to mention, such an event would forever cast them as pariahs in global history books.

No, instead they'll most certainly come up with a "deal" similar to the "fiscal cliff deal" of last New Year's Eve, or subsequent debt ceiling delay that brought us to tomorrow's "deadline."  The new deal will simply create another "deadline" in January; and in the process, dramatically worsen America's financial condition and global standing.  However, TPTB will – as usual – attempt to manipulate markets to create the perception something positive has occurred.  Whether it will succeed or not is another matter entirely; but until such attempts fail, you can bet they will attempt EVERY fraudulent trick in the book.

To wit, we're told that yesterday, after being violently attacked up until late in the day, gold and silver "soared" because the latest Senate debt ceiling negotiations fell apart; while comically, the Dow's losses were stopped shy of the "PPT ultimate limit down" of minus 1.0%.  Yes, gold was $9/oz. on the day, or just 0.7%, and silver a whopping $0.07/oz.; in the process, capped by every suppressive algorithm imaginable.  And thus, we're supposed to believe the world has ended.  Conversely, today we are told Senate and House leaders are optimistic – not un-coincidentally, just after the New York Stock Exchange opened; and thus, gold declined by more than it gained yesterday, whilst the Dow – naturally – gained more than it lost.  No matter that worldwide PHYSICAL demand is off the charts – per the below quote from a Miles Franklin Blog reader; so long as the MSM prints "gold down $10/oz."

I drove into Bangkok on Monday to buy gold ingots. The shop was bursting at the seams with customers, and I stood outside 20 minutes before being allowed in.  Bear in mind, they have 12 assistants.  Finally, ticked off after waiting outside in the street, the reality was they had completely sold out all gold bars or small tablets. The guy said they would have more tomorrow, and I should come early.  You can see this frenzied feeding here cannot last that much longer.  All my gold shops locally withdrew all their small bars because of the price drop, hence my need to travel to Bangkok 150 miles away.

You can tell your readers that they the America public are going to see a bloody big movement when it comes.

As you can see, the 2:15 AM algorithm emerged for the 95th time in the last 107 trading days; followed by PAPER raids at EXACTLY the 7:00 AM EST open of the New York "pre-market" session and the 10:00 AM EST "PM Fix"; i.e., "KEY ATTACK TIME #1"…

24hr Gold 10-16-13 953

In other words, no different than any other day over the past six months, no matter what the day's "news"; which, by the way, consisted of the following, MASSIVELY PM-bullish, – items.  One, extremely weak retail sales, and two, an imploding NAHB Housing Index – you know, the one supposedly symbolizing the "recovery" we are expected to be so giddy about.  Yes, "tapering" is off the table for the foreseeable future; and with "uber-dover" Yellen taking the Fed's reins in February, it's entirely possible my forecast of QE5 will become a reality MUCH sooner than most could imagine.

NAHB

In other words, the current PAPER attacks are inconsequential to the long-term outlook for PM prices; which, with each passing day of suppression, become more bullish.  This is why I bought more PHYSICAL gold yesterday morning, and why I will continue to do so with every free penny I receive.  The fact remains that, aside from the deleterious effect on supply due to the Cartel's inadvertent destruction of the mining industry, the worldwide demand outlook grows brighter at an exponential pace.  The "debt ceiling deal," that will surely be signed before midnight will simply increase the balance on the government's blank checkbook, enabling it to further spend the nation – and world – into DEBT and INFLATION oblivion.

Furthermore, the diminishing returns on such spending have become so acute, there now exists a negative "return on equity."  In other words, the more they spend, the more real GDP plunges – notwithstanding increasingly fraudulent accounting methods.  I wrote of this failure last week; and thought I'd follow up on the topic today, given the need to refute the inevitable PROPAGANDA of how a "debt ceiling deal" is somehow a positive development.

Frankly, to do so, one only needs to present the two charts below – demonstrating just how futile TPTB's attempts to "reflate" the system have been, other than the stock market, that is.  The first depicts the amount of DEBT created since 2008's Global Meltdown I, creating an embarrassingly paltry amount of real GDP.  Of course, the debt increase doesn't include the assumption of $5 trillion of "off balance sheet" debt owed by Fannie Mae and Freddie Mac; tens of trillions of incremental "unfunded liabilities"; or, for that matter, "shadow banking" liabilities such as off-balance sheet "swaps" to undisclosed European banks.  Not to mention, if REAL inflation accounting were utilized, the level of real GDP would be negative…

Debt Increases Do not Increase

Last but not least, how about the below chart depicting how overall economic leverage has not budged since its 2008 all-time highs?  Yes, government and GSE (government-sponsored entities) leverage appear to have blipped lower; but only because the government fraudulently changed its GDP calculation earlier this year to make the economy appear larger.  Even so, the impact is barely perceptible on this graph; whilst corporate and household leverage have also barely changed.  And by the way, household leverage only appears slightly lower due to the manipulated increase in real estate prices; which as I wrote of above, are already rolling over due to the miniscule rate increases of the past four months.

Leverage still at record highs

To conclude, no matter what occurs by midnight tonight, it will be the "worst for America, but best for Precious Metals."  Any Congressional "deal" will simply mean more debt and inflation; and irrespective, the dramatically weakening economy MUST receive "QE to Infinity" lest it will instantaneously collapse.  Conversely, if heaven forbid these fools fail to avert the debt ceiling with such a deal, the last remaining shred of American credibility will be gone forever.  Frankly, I think it's already gone; but then again, even our creditors likely could not conceive America destroying itself with the aforementioned self-inflicted gunshot.

Use this, and ANY remaining opportunities to purchase subsidized REAL MONEY while you still can; as one day soon, there's a good chance you'll NEVER get another chance – at any price.  PHYSICAL gold and silver have been immemorially utilized as money, with good reason.  They are the only substances to possess all the requisite properties; and as of today, there are still no viable choices.  No fiat scrip has ever survived, but PMs remain after five millennia of human existence; in both the REAL world, and in fiction - per the below quote from Stephen King's Wind through the Keyhole…

Ironwood was ironwood, and ironwood always sold for a good price; one paid in shards of silver, rather than scrip.

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Japan Reflation Update

Posted: 16 Oct 2013 12:55 PM PDT

Last January I noted that "one of the biggest things happening on the margin is the decline of the Japanese yen." The Bank of Japan was effectively pressured into a serious relaxation of monetary policy. After being extremely tight for many years - as reflected in zero/negative inflation, a relentless appreciation of the yen against virtually all other currencies, a very weak stock market and a moribund economy - the Bank of Japan has completely reversed course. This has had predictable and impressive results.

(click to enlarge)

The above chart shows just how impressive the increase in Japan's bank reserves has been. Reserves are up 137% in the year ending September.

(click to enlarge)

A genuine easing of monetary policy ought to result in a weaker currency, and that is exactly what has happened in Japan. The yen has gone from 78 to 99 vs. the dollar in the

Gold, Trust & Independence, Part 2

Posted: 16 Oct 2013 12:51 PM PDT

Buying gold was all the rage for central banks net-net during the crisis. But now...?
 
BUYING GOLD typically signals a lack of confidence in other people, writes Adrian Ash at BullionVault. (Read part 1 of this little series on the LBMA 2013 conference here...)
 
Yet even as governments everywhere give investors and central banks new reasons to lose trust, the trend is no longer for central banks to keep buying. Not according to analysis of the latest IMF gold data.
 
"Central bank activity in 2013 suggests the appetite for buying gold has been whetted," notes Blu Putnam, chief economist at CME Group, in his latest Markets Insights on Gold.
 
More than that, says the commodities team at French investment bank and bullion dealers Natixis, central bank gold buying – "which two years ago was the driving force behind the price of gold – has not only slowed but actually turned to net selling", albeit of 20 tonnes from this spring's 10-year record aggregate holdings of 31,940 tonnes.
 
And little wonder...
Rather than buying gold, as the CME's chart shows, central banks as a group were net sellers for two decades starting in the late 1980s. Asian and other emerging-market banks then raised their demand as prices rose (and the US Dollar fell). Former sellers in Western Europe then paused their divestment, as the global financial crisis bit hard.
 
Now, in contrast, "We don't feel comfortable with gold's volatility," said Juan Ignacio Basco, deputy general manager at the Central Bank of Argentina, at this month's London Bullion Market Association conference in Rome. "Even though it's only a small part of the [reserves] portfolio."
 
This year's volatility in prices has "definitely changed" attitudes, Basco went on, amongst central bankers towards buying gold. Argentina's experience makes a signal example.
 
Basco's central bank cut its gold bullion reserves as prices fell in the 1990s from 120 tonnes to pretty much zero. But as prices rose, Argentina then bought back some 62 tonnes. The last 8 tonnes were bought at gold's all-time highs in late summer 2011.
 
Since then? Buying gold at $1800 per ounce has resulted in a 30% loss over the last two years. Spring 2013's waterfall price drops represented "greater than two standard deviation" moves, said Basco. So "we're using options to smooth volatility," he went on. Because with gold so volatile, but falling instead of rising, "We have to do something."
 
This little titbit – plus a comment from Banque de France director Alexandre Gautier on the same panel – would seem to confirm a point which Natixis flagged 6 months ago, before gold's first sharp decline in April. Which was that, after buying gold to achieve their desired allocation whilst prices were rising, many smaller central banks "have become hedgers rather than accumulators, selling at higher gold prices and buying at lower prices in order to maintain gold holdings within their target benchmark ranges."
 
Such activity – known to financial wonks as "dynamic hedging" – involves options and other derivatives contracts. No metal is being added, even as prices fall. Because those falling prices, plus the achievement of target levels at the peak in 2011, have spooked emerging-market central banks from buying more gold bullion in 2013. Paper contracts will do nicely, thank you, for fine-tuning the portfolio's allocation to gold.
 
Hard times can make dynamic hedging less urgent, however. Because as IMF data gathered by the World Gold Council show, Argentina's official gold holdings have remained pretty constant as a proportion of its total foreign reserves. Sticking around 6.5% by value, gold has held steady even as prices fell thanks to the Latin American basket-case's latest economic crisis, which has seen it sell other currencies in a bid to buoy the Peso on the international currency markets.
 
Even so, the Banque de France – reputedly a big player in the gold sector's lending, hedging and forward selling of the late 1990s – is now "active [again] for other central banks and official institutions" the LBMA  conference learnt from M.Gautier. Certainly, European central banks are sitting tight on their hoards. So those government bodies now keeping the Banque busy, and whether buyers, sellers or hedgers, must be elsewhere.
 
The big issue, then? China. If only because it stood out by its absence. For the first LBMA conference in five, in fact, China's gold reserves weren't a hot topic of debate in Rome this month. Perhaps because everyone just assumes more gold buying by the People's Bank is par for the course.
 
China hasn't reported its official gold reserves to the world since 2009. That update added 450 tonnes to the 600 tonnes already declared. Within 6 months, near neighbor and arch-rival for Asian leadership India snapped up 200 tonnes, buying gold from the International Monetary Fund at what soon looked like a bargain price of $1050 per ounce. And while India's private gold demand has since helped tip its trade deficit into a tailspin – leading the government to put a ban on gold imports in all but name – China's demand has continued to surge.
 
The world's largest gold-mining producer, China's gold buying is likely to overtake India as the largest consumer in 2013 as well. Add up the numbers, and the gap between supply and private demand looks so huge, it's hard not to put the People's Bank right in the frame as the world's gold buyer of last resort today.
 
Why might that be? Freer to speak than the West European central bankers on the LBMA's panel in Rome, Argentina's Basco still agreed with the Bundesbank and Banque de France's key point. Even if a little less diplomatically. "Gold is a strategic matter, okay?" he told the conference. No doubt he meant from a portfolio view. But politically, gold is plainly highly strategic as well. 
 
Beijing knows it. So does the Indian government. Yet this year's key themes at the LBMA conference – of trust and confidence – were most yoked together by Indian households, weirdly absent from the discussion even as they presented the hottest topic for the 700-odd market professionals gathered in Rome.
 
Third and final part to come...

Philip Morris' Earnings Face Headwinds From Anti-Tobacco Measures, Strengthening U.S. Dollar

Posted: 16 Oct 2013 12:39 PM PDT

Philip Morris International (PM) is set to report its third quarter earnings on October 17. We expect the results to be negatively impacted by lower volumes from Philippines where a sharp hike in indirect taxes implemented earlier this year has disrupted an otherwise flourishing tobacco industry. We also expect Philip Morris' earnings from the European Union to continue to be under pressure from the growing illegal trade of cigarettes and increasing consumption of cheaper tobacco alternatives. The company's performance in Russia where the new anti-tobacco law came into effect this June will also be interesting to note. Furthermore, the strengthening U.S. dollar against international currencies is also expected to dent the company's financial performance.

Philip Morris International is a leading international tobacco company with its products sold in more than 180 countries worldwide. Until its spin-off in March 2008, Philip Morris International was an operating company of Altria Group (MO).

Jim Rickards – Why China is Buying Gold & Calling for a De-Amercanized World

Posted: 16 Oct 2013 12:30 PM PDT

Jim Rickards – Why China is Buying Gold & Calling for a De-Amercanized World

Tangent Capital Partners Senior Managing Director Jim Rickards was interviewed by Bloomberg’s Deirdre Bolton and discussed China and world reaction to the U.S. debt ceiling debacle. Rickards discussed this week’s op-ed in which China’s government newspaper openly called for the world to move away from the dollar: Nothing gets printed there that they are not [...]

The post Jim Rickards – Why China is Buying Gold & Calling for a De-Amercanized World appeared first on Silver Doctors.

Check out these similar articles:
  1. Jim Rickards: China Likely Has Accumulated 2,000-3,000 Tonnes of Gold Reserves!
  2. Jim Rickards: Entity Manipulating Gold May be China, Not the Fed!
  3. World Gold Council: China’s Investment Demand for Gold Likely to Top Record of 200 Tons in 2011

Gold to have another go at overhead resistance

Posted: 16 Oct 2013 11:53 AM PDT

The rest of the week should be tense and potentially explosive either way for the gold and silver prices, as many bet on a resolution in the US, says Julian Phillips.

GEAB N°78 is available! The de-Americanisation of the world has begun – emergence of solutions for a multipolar world by 2015

Posted: 16 Oct 2013 11:48 AM PDT

- Public announcement GEAB N°78 (October 16, 2013) -
GEAB N°78 is available! The de-Americanisation of the world has begun – emergence of solutions for a multipolar world by 2015
It's one of those times when history accelerates. Whatever the outcome of the negotiations on the shutdown and debt ceiling, October 2013 is one of them. It's the deadlock too far which has opened the eyes of those who still support the United States. A leader is followed when he is believed, not when he is ridiculous.

"Building a de-Americanised world": this statement would have raised a smile a few years ago. At most it would have passed for provocation by Hugo Chavez. But when we are seeing the United States' bankruptcy in real-time and it's an official Chinese press agency that says so (1), the impact isn't the same. In reality, it's describing out loud a process which is already well underway: simply, it's now allowed to speak about it in public. At least US government deadlock has the merit of loosening tongues (2). Let there be no mistake, this analysis hasn't appeared in the Chinese media by chance, and it reflects Beijing's hardening tone.

In fact, if the whole world is holding its breath before this pathetic game of the US elite; it's not out of compassion, it's to avoid being swept away in the fall of the world's first power. Everyone is trying to free itself from American influence and let go of a United States permanently discredited by recent events over Syria, tapering, shutdown and now the debt ceiling. The legendary US power is now no more than a nuisance and the world has understood that it's time to de-Americanise.

This perspective and speaking the unspeakable (3) is finally freeing-up a whole range of solutions which, until now, were simply signs, even still repressed by some. These solutions are speeding-up the construction of the world afterwards and opening on a multipolar world organised around major regional blocs. After a review of American setbacks, in this GEAB issue our team will analyse the forces which are shaping this changing world. In the "Telescope" section we also take a look at the actual state of US society which, behind the mirror of the stock market and finance, explains the collapse of the American way of life and take part in this look with hindsight at the US model. Finally, we update our annual country-risk assessment to complete the global picture and, of course, give our traditional recommendations and the GlobalEurometre.

Layout of the full article:
1. "No we can't"
2. A succession of crises
3. Shutdown: the laughing stock of the world, but a forced laugh
4. De-Americanisation at all levels
5. The petrodollar is dead, long live the petroyuan
6. China shows Euroland the way
7. Russia, South America: following de-westernisation

This public announcement contains sections 1, 2 and 3

"No we can't"
How times change. The whole world has forgotten the words freedom, hope and the famous saying "Yes we can" representative of US society in the eyes of previous generations to now only speak of taper, shutdown or ceiling. This isn't exactly the same dynamic and the positive image has become outright negative.

It's striking to see the extent to which the current US situation confirms the old adage that trouble never comes alone. In a six-week period, first of all humiliation by Russia over Syria, then its central bank which admits it's impossible to reduce quantitative easing (4); the inability to pass a budget which means federal government shutdown, a shutdown lasting well beyond what is reasonable (5). Negotiations on the debt ceiling at a standstill two days from the deadline; the United States ordered by the G20 to ratify the IMF reform which it has been blocking for the last three years, and by the World Bank and the IMF to put its finances in order (6). And now the Chinese shot across the bows.

A succession of crises
This succession of crises is quite worrying for the country and demonstrates unprecedented acceleration and an impending shock. There is some fatality in these crises. But there is also a dose of strategic recovery. Thus, the shutdown has been exploited by Obama to put pressure on the Republicans into voting for raising the debt ceiling, a much more important deadline for the United States. This is obviously only a partial success, but we can still expect a temporary raising, which postpones all the problems for a few weeks (7); however, it's still possible that the tragic path is chosen, because it's no more the domain of a rational decision and therefore cannot be forecast.

GEAB N°78 is available! The de-Americanisation of the world has begun – emergence of solutions for a multipolar world by 2015
In fact, whilst observers are focusing on the Tea Party which, in the same way as minority shareholders are able to control a company through a holding, has managed to hijack the Republican Party and American society; it could be read another way. Many Americans see the reality in front of them: their country is bankrupt. Consequently, is it better to postpone the confrontation with reality, at the risk of amplifying the problems, or is it better to resolve them now? The majority of the population don't take a dim view of a payment default (8). Besides, what other solution is there ultimately? Is there no desire amongst Republicans to precipitate the crisis? It's the ideal situation because they can blame the Tea Party which has stated unequivocally that "no agreement is better than a bad agreement" (9). What we mean is that, this time, or probably on another occasion in the near future, they might well be tempted to cut the Gordian knot.

Likewise, a strategic recovery certainly took place when the Fed backtracked on reducing its quantitative easing. Why did it let everyone believe right up to the last minute that it would reduce QE3 without doing so in the end? It's the first time that it has taken investors by surprise, all 100% convinced of a tapering given in the forward guidance, a well-established principle. Is there no connection between the gross insider trading proved to have taken place at the time of the Fed's announcement (10), which had to be worth billions of dollars to the perpetrators? All this supports our theory of desperate US financial institutions which must be bailed out discreetly by such operations, at the risk of undermining the Fed's credibility. Again, short-term solutions which make the situation worse but which push back the fatal deadline a little further. We are no longer the only ones to ring the alarm bell on these American banks: the Bank of England is expecting major banks to fail which, according to it, have lost the status of "too big to fail" (11). We therefore repeat our warning on this subject.

Like a boxer, all these blows that the country has taken has made it groggy and it only lacks the last one to floor it. If it doesn't come from a US payment default in October, it will be another deadline which has been pushed back which, this time, won't yield.

Shutdown: the laughing stock of the world, but a forced laugh
When we wrote in the GEAB N° 77 on the budget vote: "no doubt a compromise will be found at the last minute or, more likely, a few hours or even a few days after the deadline", one cannot help but notice that we still underestimated the political differences in Washington since the "several days" which we had in mind have turned into weeks. The daily newspaper, Le Monde, had the headline on its website of "Washington's sorry spectacle" (12). But, in the end, this shutdown hasn't had a disproportionate impact on the financial markets (13), so it's all for the better which many Republicans seem to think who are adapting well to a federal government paralysis and the cuts in public spending which follow.

This isn't the opinion of countries with large holdings of US Treasury bonds , which feel held hostage by the United States (14). They are stunned by the US' indefensible casualness and by the irresponsible attitude of who, until recently, was "the boss". If the country defaults on its debt the shockwaves will certainly be terrible. However, this wouldn't be the end of the world because a possible default could simply take the form of delayed payment for the few days; moreover different parts of the world would be unequally affected according to the extent of their de-coupling from the US economy. No, the country that will suffer most from this solution (and any other for that matter) will really be the United States itself. For the record it holds two thirds of its own public debt.

GEAB N°78 is available! The de-Americanisation of the world has begun – emergence of solutions for a multipolar world by 2015
This is why the best governed countries have already begun this major de coupling, with China in the lead which knows from Sun Tzu that "when it thunders, it's too late to cover one's ears." (15)


---------
Notes:

(1) Sources : Xinhuanet (Chinese news agency, 13/10/2013), RFI (13/10/2013).

(2) Even the Financial Times gets involved (02/10/2013) : « Dollar-based system is inherently unstable ». An incredible statement from an Anglo-Saxon financial newspaper.

(3) The world feedback that the Chinese article mentioned above received shows the interest in this statement from the world's second power, and confirms that it breaks a taboo which will help implement solutions long awaited by a majority of countries. Read, for example, the excellent analysis in the Asia Times, 15/10/2013.

(4) Source : Bloomberg, 18/09/2013.

(5) Source : CNN, 14/10/2013.

(6) Source : for example PressAfrik, 12/10/2013.

(7) Source : New York Times, 15/10/2013.

(8) 58% of Americans would vote against raising the debt ceiling. Source : Fox News, 08/10/2013.

(9) Source : Le Monde, 15/10/2013.

(10) Source : USA Today, 24/09/2013.

(11) Source : The Telegraph, 12/10/2013.

(12) Le Monde, 14/10/2013.

(13) Obviously, since the Fed is continuing its unbridled quantitative easing.

(14) All the same they are willing hostages because they massively and voluntarily financed the country...

(15) Sun Tzu, The Art of War, 6th century BC.

Stock market appears ready for new high — what about gold?

Posted: 16 Oct 2013 11:43 AM PDT

The rally in stocks seems to have triggered a decline in the precious metals sector and the following stocks' moves could further contribute to metals' performance. Will the stock indices keep rallying?

Indian gold jewellery exports up to August collapsed 57.1% y/y

Posted: 16 Oct 2013 11:37 AM PDT

Gold exports from India declined sharply during the first five months of the current fiscal. According to trade data, the country's gold jewellery exports during the period from April to August this year plunged by 57.1% over the previous year.

T minus 1 for U.S. downgrade, gold jumps 2.9% from 3-month low

Posted: 16 Oct 2013 11:35 AM PDT

London gold moved in a $10 range Wednesday morning around $1,281 per ounce as both the U.S. House and Senate were due to meet in what headline writers called "a last ditch attempt" to resolve the government's debt-limit deadline, set for tomorrow.

Gold surged 17% in 15 trading days after last debt ceiling extension in 2011

Posted: 16 Oct 2013 11:26 AM PDT

It is interesting to note that in 2011, gold rose in the months prior to the debt ceiling agreement. Then in the immediate aftermath of the debt ceiling extension agreement on August 2nd 2011, gold surged another 17% in 15 trading days after the agreement was reached.

22 Reasons To Be Concerned About The U.S. Economy As We Head Into The Holiday Season

Posted: 16 Oct 2013 11:15 AM PDT

22 Reasons To Be Concerned About The U.S. Economy As We Head Into The Holiday Season

Are we on the verge of another major economic downturn?  In recent weeks, most of the focus has been on our politicians in Washington, but there are lots of other reasons to be deeply alarmed about the economy as well.  Economic confidence is down, retail sales figures are disappointing, job cuts are up, and American [...]

The post 22 Reasons To Be Concerned About The U.S. Economy As We Head Into The Holiday Season appeared first on Silver Doctors.

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Forget the short term – gold is for the long run

Posted: 16 Oct 2013 10:32 AM PDT

Gold's recent poor performance has somewhat dampened the outpourings of the out and out gold bulls, but as a long term wealth protector then its prospects remain undiminished.

Boehner Folds, Full Details of Debt “Deal”

Posted: 16 Oct 2013 10:28 AM PDT

Boehner Folds, Full Details of Debt "Deal"

Speaker John Boehner has reportedly folded, and will give in to essentially all of Obama’s demands according to reports. While the media reports that the deal is a 3-month can-kicking, the reality of the “deal” is far worse. Full details of the debt limit and gov’t re-opening “deal” are below: Silver Bullet Silver Shield Collection [...]

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First Majestic Produces a New Record of 3.37 million Ag-Eq Oz

Posted: 16 Oct 2013 10:03 AM PDT

First Majestic Silver Corp. (“First Majestic” or the “Company”) is pleased to announce that total production at its five operating silver mines in Mexico for the third quarter ending September 30, 2013, reached a new quarterly record of 3,370,457 equivalent ounces of silver, representing a 38% increase compared to the same quarter in 2012.

Total silver production for the quarter consisted of 2,689,237 ounces of silver, representing an increase of 22% compared to the same quarter in 2012. In addition, 8,543,551 pounds of lead and 2,232,881 pounds of zinc were produced representing an increase of 158% and 164%, respectively, compared to the same quarter of the previous year. Also, 2,942 ounces of gold were produced, representing an increase of 91% compared to the third quarter of 2012.

Keith Neumeyer, President & CEO of First Majestic, states, “While the third quarter was another volatile period for silver prices, we continue to make progress with our growth strategy in Mexico. The San Martin mill expansion, which is now complete, marks the third major project completed by First Majestic in 2013, following the recent production start-up of Phase 1 at the Del Toro Silver Mine and the completion of the mill expansion at the La Guitarra Silver Mine. Our operations team deserves to be recognized for a job well done.”

Production Details Table:

Consolidated Production Results Quarter Ended
September 30,
2013		 Quarter Ended
September 30,
2012		 % Change over
Prior Year’s Quarter
Ore processed/tonnes milled 641,345 666,688 -4%
Total production – ounces of silver equivalent 3,370,457 2,438,085 38%
Total silver ounces produced 2,689,237 2,205,237 22%
Silver Grade (g/t) 202 167 21%
Silver Recovery (%) 65% 62% 5%
Pounds of lead produced 8,543,551 3,307,944 158%
Equivalent ounces from lead 382,385 99,263 285%
Pounds of zinc produced 2,232,881 844,953 164%
Equivalent ounces from zinc 88,754 24,577 261%
Gold ounces produced 2,942 1,537 91%
Equivalent ounces from gold 182,891 91,690 99%
Tonnes of iron ore produced 5,203 4,673 11%
Equivalent ounces from iron 27,190 17,318 57%

Operational Review:

The total ore processed during the quarter at the Company’s five operating silver mines, La Encantada, La Parrilla, San Martin, La Guitarra and Del Toro, amounted to 641,345 tonnes milled, representing a slight decrease of 4% over the previous quarter primarily due to the continued optimization at the La Encantada mine in addition to the effects of two major hurricanes which hit Mexico in the month of September.

Silver grades in the quarter for the five mines remained relatively unchanged from the previous quarter at 202 g/t of silver. Combined silver recoveries averaged 65% in the quarter and remained in line with the second quarter average of 64%.

The Company’s underground development in the third quarter consisted of 10,923 metres, a 19% decrease compared to 13,479 metres completed in the previous quarter. This decrease is part of a planned reduction of capital expenditures aimed at reducing costs due to the lower metal price environment.

During the quarter, six diamond drill rigs were operating at the Company’s five operations. The Company completed 7,823 metres of diamond drilling in the quarter, compared to 25,469 metres in the prior quarter, representing a 69% decrease resulting from the previously announced exploration budget cuts.

At the Del Toro Silver Mine:

  • Throughput in the new flotation mill averaged 1,061 tpd in the third quarter with head grades of 244 g/t silver, 4.3% lead and 2.8% zinc. Silver recoveries averaged 69% during the quarter compared to 72% from the previous quarter due to a variation in the ore feed from a transition zone between oxides and sulfides. Further testing is underway at the Company’s central lab with the objective of improving overall metallurgical recoveries, however, once the new cyanidation circuit is operational, some of these ores will be processed through this circuit.
  • Phase 2 construction, including the Merrill-Crowe area, the clarification circuit, and the installation of two precipitate filter presses and two induction furnaces is nearing completion. Phase 2 includes the addition of a 1,000 tpd cyanidation circuit allowing the facility to produce silver doré bars. Once completed, which is expected in November, the facility will have total capacity of 2,000 tpd.
  • During the quarter, the crushing circuit was expanded to allow for the capacity increase to 2,000 tpd. In addition, the installation of the 12′ by 14′ oxide ball mill, pumps, motors and other mechanisms for the cyanidation circuit were also completed.
  • During the quarter, tailings filter #3 was successfully installed and tested. Progress continues in regards to the installation of the final tailings filter #4, which is now 95% complete and undergoing initial testing. Filters #1 and #2 are currently in operation. These four tailing filters will be able to handle up to 4,000 tpd and will recycle approximately 80% of the water used throughout the milling process.
  • The construction of the 45 km, 115,000 kW power line from the state of Durango has experienced several delays due to its length and complexities. Originally scheduled for completion in July, then expected by November, the Company’s latest estimate for completion is prior to year end. In order to have sufficient power for Phase 2, the National power company, CFE, has arranged to increase the current power levels on the existing 34,000 kW power line by providing up to 6 MW for the interim period until the new power line is completed. This upgrade will allow the Company to commission the cyanidation circuit in November. Once connected to the larger 115,000 kW power line, cost savings are expected to be achieved resulting from the discontinued use of diesel powered generators which are currently working together with the 34,000 kW power line to supply the required power to the operation.
  • In order to conserve capital in 2014, and to better utilize the abundance of oxide ore being produced from the San Juan area, the Company is evaluating the earlier ramping up of the cyanidation circuit to 2,000 tpd and the delay of the construction of the 4,000 tpd shaft and postponing the installation of the second SAG Mill which would be for the purpose of reaching 2,000 tpd through the flotation circuit. The current evaluation underway is determining the capital savings of bringing on the 2,000 tpd cyanidation circuit in 2014 and delaying the expansion of production through the flotation circuit until 2015. It is currently not expected that this modification of the expansion plan at Del Toro will materially affect 2014 production guidance, however, once the evaluation is completed, the Company will release full guidance for the year as it does in normal course in January.
  • Total exploration metres drilled in the third quarter amounted to 2,856 metres, compared to 6,579 metres drilled in the previous quarter as a result of the reduction to the exploration budget. In addition, 1,817 metres of development were completed in the third quarter of 2013, compared to 3,194 metres of development in the previous quarter. During the quarter, one underground drill rig was active at Del Toro.

At the La Encantada Silver Mine:

  • The cyanidation mill averaged 2,959 tpd during the quarter consisting of 54% fresh mine ore and 46% of old tailings. Due to a breakdown that occurred in the gear and motor at ball mill #1, a complete upgrade of the motor foundation and gear system was required. The ball mill remained offline for a period of 6 weeks resulting in the reduction of fresh ore processing and the increase of old tailings sent to the plant. The reduction of fresh ore and the increase of tailings feed produced a combined head grade of 228 g/t of silver with a mill recovery of 49%. Ball mill #1 is now fully operational and silver grades and recoveries are back to normal levels.
  • Underground development continues to be focused on new areas within the mine defined by the latest exploration program. Currently, the primary areas of focus are the surrounding ore bodies of the Milagros and San Javier breccia pipes. Additionally, mine development and production continue from the San Francisco vein and the recently discovered “990″ and “990-2″ chimneys. At the newly discovered Regalo vein, a new area was prepared for long-hole drilling aimed at increasing the production of fresh ore to a rate of 2,000 tpd by the middle of next year.
  • A total of 2,928 metres of exploration drilling was completed in the third quarter, compared to 2,140 metres of drilling in the previous quarter, representing an increase of 37%. In addition, a total of 3,195 metres of underground development were completed in the third quarter, compared to 3,597 metres of development in the previous quarter, representing a decrease of 11%.
  • Three diamond drill rigs are active underground at La Encantada with the objective of defining Reserves and Resources in the newly discovered areas in addition to assisting in mining activities.
  • A substantial portion of the current drilling and develop is for the purpose of the planned release of an updated NI 43-101 Technical Report in the middle of 2014.

At the La Parrilla Silver Mine:

  • La Parrilla had excellent results during the quarter and continues to operate above budget. Silver production totaled 866,710 ounces during the quarter, representing a 22% increase from the previous quarter, due to improved silver grades and recoveries.
  • The construction of three new leaching tanks was completed during the quarter allowing for longer leaching times with the objective of further increasing recoveries.
  • Underground development completed in the quarter totaled 2,213 metres compared with 3,088 metres developed in the previous quarter.
  • As part of the planned reduction in exploration spending, a total of 177 metres were drilled in the third quarter compared to 4,065 in the previous quarter.

At the San Martin Silver Mine:

  • Due to a heavy rain fall season caused by hurricanes along the Pacific Coast, total silver production reached 339,099 ounces of silver in the quarter representing a decrease of 9% compared to the previous quarter. Silver grades averaged 165 g/t during the quarter and continue to show positive improvement as higher grade ore is processed from the new Rosarios area.
  • The mill expansion from 900 tpd to 1,300 tpd was completed on October 11, 2013 and increased production is already underway. The production ramp up will increase from 900 tpd to 1,200 tpd in the fourth quarter with immediate commercial production. Due to a decision to change out the older 8.5′ x 12′ ball mill for a new larger 9.5′ x 12′ ball mill, full capacity to 1,300 tpd is now expected to be reached in the first quarter of 2014. This change does not impact the expected annual operating results and should result in a more reliable operation in future years.
  • At full capacity of 1,300 tpd, San Martin’s annual silver production is anticipated to increase by over 50% to approximately 1.4 to 1.6 million ounces of silver in the form of doré bars plus potential upside resulting from higher silver grades and higher gold credits over the life of the mine.
  • Underground development completed in the third quarter totaled 2,267 metres, compared with 2,276 metres of development in the previous quarter. The mine development continues to be focused at the new Rosarios area where seven areas are now in production.
  • One underground drill rig was active within the San Martin property during the quarter. Total metres drilled in the third quarter amounted to 376 metres, compared to 6,133 metres of drilling in the previous quarter.

At the La Guitarra Silver Mine:

  • During the third quarter, the full production of silver-gold concentrates were sold under the previously announced new smelter agreement allowing the Company to discontinue concentrate shipments to the La Parrilla mine for further refining. As a result of this new agreement, the Company has achieved a significant reduction in treatment charges and transportation costs.
  • Mine development at the Joya Larga structure within the El Coloso area has now reached 112 metres along the vein. Development continues to advance towards the target production area located approximately 90 metres away from the current face. Initial production from this new area is expected to begin in November at an approximate rate of 100 tpd.
  • During the third quarter, production ore came from areas within the La Guitarra vein which contained higher gold grades in conjunction with lower silver grades. Looking ahead, the average silver grade is expected to improve in the fourth quarter once production commences at the new Joya Larga structure. This new area has indicated grades ranging between 200 g/t to 350 g/t silver.
  • A total of 1,431 metres of development were completed in the third quarter, compared to 1,324 metres of development in the previous quarter.
  • One underground drill rig was active in the third quarter within the La Guitarra property. Total metres drilled in the quarter amounted to 1,486 metres compared to 6,552 metres drilled in the previous quarter.
  • The La Guitarra exploration program continues to focus on defining Reserves and Resources to support an updated NI 43-101 Technical Report scheduled to be released by the middle of 2014.

Outlook:

With San Martin’s mill expansion to 1,300 tpd now complete and ramping up to 1,200 tpd immediately, and with the addition of the new 1,000 tpd cyanidation circuit at Del Toro, the Company expects silver production in the fourth quarter to be very robust. Furthermore, with year-to-date production totaling 9.4 million silver equivalent ounces, the Company expects to meet or exceed its 2013 guidance of producing 12.3 million to 13.0 million silver equivalent ounces. Silver production for the first nine months in 2013 has totaled 7.9 million ounces and remains in line with annual guidance of 11.1 to 11.7 million ounces of silver.

First Majestic is a mining company focused on silver production in México and is aggressively pursuing its business plan of becoming a senior silver producer through the development of its existing mineral property assets and the pursuit through acquisition of additional mineral assets which contribute to the Company achieving its aggressive corporate growth objectives.

FOR FURTHER INFORMATION contact info@firstmajestic.com, visit our website at www.firstmajestic.com or call our toll free number 1.866.529.2807.

FIRST MAJESTIC SILVER CORP.
“signed”
Keith Neumeyer, President & CEO

Cautionary Note Regarding Forward Looking Statements

Hold On a Second There

Posted: 16 Oct 2013 10:00 AM PDT

“Conspiracy theorists.”  They are all over the place.  They are nuts.  They are just a bunch of “disgruntled’s” because they either didn’t get their way or they are a bunch of idealists who think the world should fit their crazy theories.  But hold on there just a second, many of the past "theories" has already been proven as absolute fact.  In the words of Tyler Durden when describing the at market volume dumps in the gold market had this to say:

The good news is that as everyone knows, aside from equity, electricity, FX, Libor, aluminum, and credit derivative markets (in just the case of JPM) gold is never manipulated: Blythe Masters promised. So there’s that.

-Zero Hedge, October 15, 2013

Many of these “theories” were not even “out there” or even close to off the wall, many were just of the plain Occam’s razor common sense sort that was pretty obvious in retrospect. My point is that “conspiracies” do exist, many have been proven factual and few even take any stretch of the imagination to understand or believe.

The above leads me to another area currently in the news, the debt ceiling.  What in the world or how could anything to do with the debt ceiling have even a remote possibility of being “conspiratorial?”  Someone mailed me a second hand word of a “friend” who supposedly has worked in Washington DC for some 40 years and says that the current circus saga over the debt ceiling was “planned.”  He said it was planned 6-8 months ago.  Should we believe this?  Should we believe the second hand word of someone we don’t even know?  Who is this guy and how could he know this?  Does he have an agenda or is he just messin’ with us?  I must confess that subconsciously I thought the same thing but I didn’t really know why.  Just as with other “events” that I’ve watched with my own eyes that didn’t make sense initially, and then I figured out what was wrong eventually.  I think I’ve figured this one out.

Please stay with me; this is so simple that it’s stupid.  We are now living through a “government shutdown” where parks and memorials are shut down across the country.  This is kind of stupid because there really is no expense to keep a bike path, cemetery or open air memorial open.  In fact it takes even more expense to kick people out (and to give them tickets as penalty for law breaking).  But this is what is happening and has been happening since day 1.  So where is the “funny business?”  Signs!  Where did all of the signs come from?  The signs that say that the park is closed or the memorial or the walking trail (or “closing the ocean”)… where did they come from?  Who ordered them?  How long ago were they ordered?  Why were they ordered?  Were signs ever erected in past government shutdowns?  I’ll bet that never in the past when we had one of these Congressional pushing matches that parks etc. were not closed.  I don’t know this for a fact but I don’t ever remember it.

In any case, these signs (since they were ordered by Washington) were not ordered a day or 2 before the shutdown, Washington doesn’t work like that.  The graphics, wording, size and materials (not to mention the awarding of “non bid” contracts to printers) all had to be chosen ahead of time.  The signs had to be fabricated and shipped all over the country to arrive “in time.”  Is this a big deal?  Well, not really except for the fact that to me this whole government shutdown/debt ceiling debate seems “staged” or made for public consumption.  I smell a rat, what sort of rat I don’t know…but, at least we know that gold and silver are still free and fair markets?

I wrote the above late yesterday and since then have seen where the USDA has told states not to forward their Nov. issuance files and to delay transmission of “electronic benefit transfers” EBT (food stamps) …until further notice.  I read this at Zero Hedge and have not found it yet anywhere else.  If this turns out to be true and no debt deal is arrived then I guess we will have the answer (the rat that I smell?) to another one of those crazy conspiracy theories.  You know, those “crazies” who have said that the only reason that over 2 billion rounds of hollow point ammunition have been delivered to domestic government agencies…is to… use them.  50 million hungry, angry and eventually rioting people might be a reason?  As I have said all along, silver will spend when nothing else will.Similar Posts:

ECB Head Mario Draghi On Gold & Banking; Admits “Central Bankers Are Powerful—They Are Also Not Elected”

Posted: 16 Oct 2013 10:00 AM PDT


When asked by Tekoa da Silva his thoughts on gold as a reserve asset, the European Central Bank’s Mario Draghi responded: "Well you're asking this to the former Governor of the Bank of Italy, and the Bank of Italy is the fourth largest owner of gold reserves in the world, which is out of all [...]

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Argonaut Gold Announces Q3 Gold Production of 26,690 Oz

Posted: 16 Oct 2013 09:59 AM PDT

Toronto, Ontario – (October 16, 2013) Argonaut Gold Inc. ("Argonaut", "Argonaut Gold" or the "Company"; TSX: AR), announced today that the Company had gold production of 26,690 ounces during the 3rd quarter ended September 30, 2013. This included 22,756 ounces at its 100% owned El Castillo Mine ("El Castillo") located in Durango, Mexico and 4,234 ounces of gold at its 100% owned La Colorada Mine ("La Colorada") located in Hermosillo, Mexico.

Argonaut Gold is also pleased to announce that it has entered into a surface and mining rights exchange agreement with Richmont Mines Inc. (“Richmont”; TSX:RIC). Pursuant to this agreement, Argonaut Gold will expand land access associated with its Magino Gold Project by obtaining both surface rights and mining rights up to 400 meters in depth on certain Richmont claims surrounding the project. Argonaut Gold will transfer its interest in certain claims to Richmont, to enable it to expand its exploration potential at its Island Gold Deep project. The terms of this agreement provide a $2 million payment from Argonaut to Richmont.

THIRD QUARTER 2013 HIGHLIGHTS:

El Castillo

  • Production of 22,756 gold ounces.
  • 39,120 gold ounces loaded on the pad.
  • West Side Pad 8 construction is ongoing.
  • West Side crusher and overland conveyor project was completed and is operational.
  • Permits were received for the new south waste dump.

La Colorada

  • Production of 4,234 gold ounces.
  • Production of 31,717 silver ounces.
  • 5,571 gold ounces and 76,692 silver ounces loaded on the pad.
  • La Colorada pit continues to be opened.
  • New crushing circuit installation was completed and is operational.

Magino

  • Mineral rights and land allows expansion of pit limits and further project development.

THIRD QUARTER 2013 El CASTILLO OPERATING STATISTICS

3 Months Ended September 30
 
9 Months Ended September 30
 
2013
2012
% Change
 
2013
2012
% Change
Mining (Tonnes 000's)
 
 
 
 
 
 
 
Total tonnes mined
6,542
6,355
↑3%
19,424
17,358
↑12%
Total ore mined
3,406
3,083
↑11%
9,857
8,640
↑14%
Heap Leach Pad (Tonnes 000's)
 
 
 
 
 
 
Tonnes ore direct to leach pad
1,868
1,811
↑3%
5,307
5,528
↓4%
Tonnes crushed
1,539
1,270
↑21%
4,535
3,273
↑39%
Production
 
 
 
 
 
 
 
Gold grade (g/t)
0.36
0.42
↓15%
0.36
0.40
↓8%
Gold loaded to leach pad (oz)
39,120
41,630
↓6%
115,312
112,133
↑3%
Gold produced (oz)
22,756
24,575
↓7%
73,957
61,907
↑20%
Gold ounces sold
25,840
33,839
↓24%
72,054
66,286
↑9%
1 ”g/t” is grams per tonne
2 ”oz” means troy ounce

Richard Rhoades, Chief Operating Officer of Argonaut Gold, said "Q3 gold production at El Castillo was impacted by the seasonal monsoon rainfall, while this impacted quarterly results full year production will meet our guidance. Permits were received at El Castillo for construction of the new overburden deposit areas, which will provide a shorter haulage of overburden at the south end of the pit. Also, the new west side crushing and overland conveying system was completed in August and is now fully operational. Argonaut anticipates El Castillo will continue to produce 100,000 ounces a year.

At La Colorada, we continue to open the Gran Central/La Colorada pit and are now mining ore grade material. The mining contractor is in the process of a planned expansion of the fleet which will increase tonnage. This should allow for 60,000 tonnes per day to be mined, which will lead to future production growth. By year end, La Colorada will be operating at approximately a 50-60,000 ounce run rate.

THIRD QUARTER 2013 LA COLORADA OPERATING STATISTICS

3 Months Ended September 30
 
9 Months Ended September 30
 
2013
2012
% Change
 
2013
2012
% Change
Mining (Tonnes 000's)
 
 
 
 
 
 
 
Total tonnes mined
3,300
2,708
↑22%
11,798
4,228
↑179%
Total ore mined
415
924
↓55%
1,313
2,410
↓46%
Heap Leach Pad (Tonnes 000's)
 
 
 
 
 
 
Crushed ore tonnes to pad
535
848
↓37%
1,250
2,272
↓45%
Production
 
 
 
 
 
 
 
Gold grade (g/t)
0.33
0.43
↓23%
0.31
0.43
↓29%
Gold loaded to leach pad (oz)
5,571
12,276
↓53%
12,130
31,335
↓61%
Gold produced (oz)
4,234
6,499
↓35%
15,527
14,174
↑10%
Silver produced (oz)
31,717
41,937
↓24%
121,914
84,915
↑44%
Gold ounces sold
4,952
8,695
↓43%
15,935
13,993
↑14%
Silver ounces sold
50,881
52,861
↓4%
132,951
62,609
↑112%
1 ”g/t” is grams per tonne
2 ”oz” means troy ounce

Pete Dougherty, President and CEO said, "Despite some operational challenges we remain on target to produce 100,000 ounces at El Castillo and 24,000 ounces at La Colorada, which will meet our 2013 guidance of 120,000 – 140,000 ounces of gold. The capital expansion programs at both sites should pay dividends in Q4 and set the standard for 2014 production."

In referencing the recent land acquisition agreement with Richmont, Mr. Dougherty added "It now allows for future pit expansion and provides additional exploration upside for the project. Our teams are now looking at the potential changes the land expansion may have on the project."

Argonaut Gold Q3 Financial Results Conference Call and Webcast:
The Q3 financial results call is scheduled to take place on November 12, 2013 at 8:30 am ET. Details for the call in participation are:

Q3 Conference Call Information:

Toll Free (North America): 1-866-223-7781
International: 1-416-340-8018
Webcast: www.argonautgold.com

Q3 Conference Call Replay:

Toll Free Replay Call (North America): 1-905-694-9451
International Replay Call: 1-800-408-3053
Passcode: 7979249

The conference call replay will be available from 10:30 a.m.

Virtual Currencies: Gold Rush or Fools’ Gold, The Rise of Bitcoin in a Digital Economy

Posted: 16 Oct 2013 09:56 AM PDT

Stacy Summary: There are many ways to look at virtual currencies! This is a long discussion looking at bitcoin and other digital currencies from many different angles.

Alasdair Macleod: Valuing Gold

Posted: 16 Oct 2013 09:00 AM PDT

Alasdair Macleod: Valuing Gold

Before Lehman collapsed, there was a general lack of awareness of the risk that the whole financial system was in danger. In this context, a gold price of less than $918 was perhaps justifiable. After the event, while the Fed struggled to stabilise the banking system, the gold price initially fell to $656, or to [...]

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Gold premiums jump 150% in a week – hit a new record high in India

Posted: 16 Oct 2013 08:01 AM PDT

With the paper price of gold being smacked each way to sunday, it's worth remembering that if you tried to pick up and ounce of physical for anywhere near spot you'd be doing very, very, well. Just...

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Shanghai Gold Exchange VS. Obamacare: FREE MARKET VS. TYRANNY

Posted: 16 Oct 2013 08:00 AM PDT

Shanghai Gold Exchange VS. Obamacare: FREE MARKET VS. TYRANNY

Koos Jansen and Jan Skoyles, writer and researcher for TheRealAssetCo join the SGTReport to compare the REAL DEMAND for PHYSICAL GOLD at the Shanghai Gold Exchange VS. the manufactured (or non-existent) demand for paper gold on the COMEX, and for the fascist monstrosity known as 'Obamacare' — the REAL reason behind the current US Federal [...]

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Guest Post: Gold Market Sunk to Keep Bond Market Afloat

Posted: 16 Oct 2013 07:00 AM PDT

Guest Post: Gold Market Sunk to Keep Bond Market Afloat

Gold and silver prices are being deliberately and criminally destroyed by bankers hoping to keep the financial system alive a little longer as the wealth of the economy is transferred to bankers in the form of interest payments.  Keeping the financial system functioning while manipulating gold and silver prices (and other schemes, such as  interest [...]

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Gold Will Be the Bedrock of the New Currency

Posted: 16 Oct 2013 06:45 AM PDT

We have been in Florida for two weeks.  When we arrived, our Comcast system was down – no TV, no phones and no Internet.   The problem was in the wiring, not the Comcast signal, and it could not be fixed.  We immediately placed an order for Uverse, an AT&T service that was wireless to replace Comcast.  It was installed today and I am just beginning to navigate my way around it.

I will start to write my column again in a day or two.  I am comfortable with the quality of information that we have been sending out from Andy Hoffman and Bill Holter.  They are two of the top writers in our industry.  They have kept you up to date in my absence.

One thing I do want to call your attention to today is a commentary by Peter Mickelberg on Jim Sinclair's website.  Peter answers most of Jim's Emails for him.

He wrote the following:

We must act in accordance with the Jim's GOTS strategy to the fullest extent possible, according to our personal circumstances. The future for the currency system is, as Jim has previously advised, a new virtual reserve currency made up of the US$, the Euro, the Yen, the Renminbi and gold which will be the keystone of what Jim has called the Great Reset. The inclusion of gold in that process is inevitable and is the main reason why a prudent investor should continue to have substantial exposure to gold and gold related items. Whilst gold is currently the subject of a successful manipulation in price you should ask yourself why China purchased more than 270 tons of gold in August this year and is on course to purchase more than 1000 tons for the year. These purchases are not a trade or a speculation; they are made in the knowledge that gold is going to assume a position of preeminence as the currency of choice. You and your clients would be best served to ask why they own gold and along with an understanding of the Great Reset they could rest easily knowing that in the long term they have bought insurance and an opportunity to profit greatly when gold becomes a part of the new reserve currency.

-jsmineset.com, October 14, 2013

The Great Reset, as Sinclair calls it, spells the end of the US dollar as the world's reserve currency.  That is THE reason you own physical gold, never sell it unless you are out of other assets to dispose of, and pay no attention to the day-to-day price.  It doesn't matter.  All that matters is if you have it or you don't when the Great Reset takes place.

The bottom line is, either you believe this is where we are headed or you don't.  If you don't, then reading this newsletter is not of much value to you.  If you do, then what we write about, Bill Andy and I is priceless.

So many people are influenced by the "price" of gold and silver.  When the price falls, as is the case now, then gold and silver become bad "investments."  If you want to "invest," try the ETFs or mining shares and take your chances.  If you understand that gold will be the bedrock of the new currency that is launched in the Great Reset. 

I think the following graph speaks volumes about whether it is worth buying and holding gold now.  One thing you can say about the Chinese; they are probably the world's shrewdest investors.  Here is what they think about gold…

Chart Of The Day: China Imports Over 2,000 Tons Of Gold In Last Two Years Submitted by Tyler Durden on 10/13/2013 11:15 -0400

China has just one thing to say to all those who engage in the now daily slamdowns of gold just around the time of the London fixing, after 8 am Eastern, which lately have gotten so vicious they have resulted in “stop logic” market halts not on one but at least two occasions, keeping the price of gold delightfully low for all those who instead of selling, are looking to buy: “thanks.”

As the chart below shows, in the past two years since September 2011 (ironically the same month we wrote “Wikileaks Discloses The Reason(s) Behind China's Shadow Gold Buying Spree” namely that the PBOC was quietly seeking to make the renminbi the new gold-backed reserve currency) the mainland has imported an unprecedented 2,116 gross tons of gold from Hong Kong (in addition to the hundreds of tons produced domestically), for the first time crossing the 2k gross ton import barrier in a two year period!

Read More…

Here is the latest from Richard Russell on King World News…  Russell has a wonderful "feel" for gold.  I have followed his writing for the last 30 years and he understands gold better than most people.  He understands the Federal Reserve and what they have done and are doing to our currency.  Make sure you have a golden parachute.

Richard Russell – The 60-Year Shocker, Silver Shorts & Gold

January 7, 2013

Richard Russell:  "Bear market?  Sure, back in the year 2000, for only 273 dollars you could buy one ounce of gold.  But by 2012, you needed over 1600 dollars to buy the same one-ounce of gold.  The eternal value of gold doesn’t change.  It’s the purchasing power of the Federal Reserve note that has changed.

What is even more remarkable is the fact that most Americans have totally ignored (even despised) this remarkable bull market.  Let a stock rise seven or eight years in a row, and it will be the talk of Wall Street and the talk of every social gathering in the nation.

Read More…

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SDB’s Lowest Price EVER on Silver Rounds!

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The Myth of China’s Financial Time Bomb

Posted: 16 Oct 2013 05:45 AM PDT

The role of China's "shadow banking" sector in financing extravagant local development projects has led financial pundits to warn of a Chinese financial meltdown with global repercussions. Research Fellow Takashi Sekiyama puts the issue into perspective, even while sounding a more measured warning regarding the need to control moral hazard...

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Gold Surged 17% In 15 Trading Days After Last Debt Ceiling Extension In 2011

Posted: 16 Oct 2013 05:02 AM PDT

gold.ie

Embry scoffs at Lassondes claim that central bankers ignore gold

Posted: 16 Oct 2013 05:02 AM PDT

GATA

Gold Surged 17% In 15 Trading Days After Last Debt Ceiling Extension In 2011

Posted: 16 Oct 2013 04:22 AM PDT

It is interesting to note that in 2011, gold rose in the months prior to the debt ceiling agreement. Then in the immediate aftermath of the debt ceiling extension agreement on August 2nd, 2011, gold surged another 17% in 15 trading days after the agreement was reached. Then from August 1st to August 22nd, gold rose from $1,619/oz to over $1,900/oz.

Today's AM fix was USD 1,278.25, EUR 944.75 and GBP 797.71 per ounce.
Yesterday's AM fix was USD 1,255.50, EUR 929.59 and GBP 787.79 per ounce.

Gold climbed $8.60 or 0.68% yesterday, closing at $1,281.30/oz. Silver rose $0.07 or 0.33% closing at $21.33. Platinum climbed $2.99 or 0.2% to $1,380.49/oz, while palladium fell $7.78 or 1.1% to $704.72/oz.


Gold in USD and Debt Ceiling 2011  – (Bloomberg)

Gold came under pressure in early Asian trading prior to turning around and rising to $1,290/oz. Gold was capped at these levels and then gave up those gains to trade flat in European trading despite Fitch placing the United States triple A rating on credit watch.

U.S. lawmakers are scrambling to come up with an agreement to increase the federal debt ceiling before tomorrow's deadline. Gold has not priced in a U.S. default – which could result from failure to raise the borrowing limit – on expectations that Congress will reach a deal at the last minute.

A default remains unlikely but should it happen it would roil global markets, hamper economic recovery and lead to another wave of safe haven gold buying.

More likely, is that politicians once again raise the debt limit to over $17 trillion – thereby eliminating the short term crisis but increasing the likelihood of a far bigger crisis in the coming months and years.

Physical buying remains robust particularly in China and India where premiums are rising again as gold is snapped up by canny Asian value buyers.

Gold premiums in India, the world’s biggest buyer of gold along with China, hit a record $100 an ounce due to a shortage of bullion to meet festival demand. In China, premiums in the Shanghai Gold Exchange climbed to over $20 an ounce from about $7 two weeks ago.

Gold has fallen about 4% since the government shutdown began on October 1, leading many to believe that if there is no debt deal, the price could shoot up, particularly should we get a significant bout of "risk off" in markets.


Gold In USD, 3 Days – (Bloomberg)

It is interesting to note that in 2011, gold rose in the months prior to the debt ceiling agreement. Then in the immediate aftermath of the debt ceiling extension agreement on August 2nd 2011, gold surged another 17% in 15 trading days after the agreement was reached. From August 1st to August 22nd, gold rose from $1,619/oz to over $1,900/oz.

The United States lost its important AAA credit rating from Standard & Poor’s late on Friday August 5th, 2011, in a dramatic vote of no confidence for the world’s largest economy and the U.S. dollar.

This was a catalyst for the surge to the record nominal high of $1,920/oz two weeks later.


Gold In USD, 10 Days – (Bloomberg)

How Fitch has not downgraded the U.S. already is a mystery to analysts looking at the U.S. fiscal position and the lack of political will to tackle it. It seems likely that significant political pressure is being put on credit ratings agencies regarding their credit rating of the U.S.

The very poor fiscal position of the U.S. will gradually erode confidence in the dollar which will see it continue to lose value against gold. The continuing depreciation of the dollar and the further downgrading of the U.S. credit rating from AAA will contribute to higher prices again.

The question is when, rather than if.

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Is Sugar Once Again Signaling the Next Big Move in Gold & Silver?

Posted: 16 Oct 2013 04:00 AM PDT

Is Sugar Once Again Signaling the Next Big Move in Gold & Silver?

The financial condition of the government of Japan is much worse than most other governments. That means that money printing, in the form of QE, can get out of control much more easily than in other nations.  If the current volume of Japanese QE continues for another year or two, or even accelerates, I expect [...]

The post Is Sugar Once Again Signaling the Next Big Move in Gold & Silver? appeared first on Silver Doctors.

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Sprott's Thoughts: Is Gold Still a Safe Haven?

Posted: 16 Oct 2013 02:28 AM PDT

Sprott's Thoughts: Is Gold Still a Safe Haven?

With the deadline for a U.S. default looming this Thursday night, hopes were high Monday evening that the legislative impasse could be breached. What is more puzzling than elected officials ‘playing with fire’ over a potential US debt default is the performance of gold during the recent period of uncertainty. This would seem to be a crisis custom made for gold, but the price action of late is telling a different story – since the government shutdown on October 1st, the gold spot price has fallen $50. So while the US government has closed down and the potential for a historic default exists, gold has delivered a negative return to investors. Owning an asset that is no-one’s obligation and has no ties to the financial system would seem to be prudent at a time like this, so why hasn’t gold performed better?

This commentary by David Franklin was posted on the sprottgroup.com Internet site yesterday afternoon...and it falls into the must read category.

Jim Rickards predicts how gold price suppression will end

Posted: 16 Oct 2013 02:28 AM PDT

Jim Rickards predicts how gold price suppression will end

Interviewed by Fabrice Drouin Ristori for the Goldbroker Internet site, fund manager and geopolitical strategist James G. Rickards predicts how the Western central bank gold price suppression scheme will end and what signs likely will precede it.

This short interview with Jim was posted on the goldbroker.com Internet site on Monday...and its definitely a must read.  I found the story in a GATA release that Chris Powell filed from Sydney, Australia late Wednesday afternoon local time.

Jim Rickards Predicts How Gold Price Suppression Will End

Posted: 16 Oct 2013 02:28 AM PDT

"Prices were set lower to trigger technical fund sell stops on their long positions"

¤ Yesterday In Gold & Silver

All was calm in the gold market in Far East trading on their Tuesday, but as I commented at length on in The Wrap yesterday, that all ended just before 9 a.m. BST in London.

At that point the high-frequency traders put in an appearance, and by the time the engineered price decline was done for the day, gold was down over twenty bucks from its Monday close in New York.

The low came at the noon silver fix in London.  From there it chopped higher into the afternoon gold fix, which came at 10 a.m. EDT.  After that, the gold price chopped sideways into the 1:30 p.m. Comex close.

About 30 minutes later, a new rally erupted in electronic trading, and it was obvious from the choppy price action that this rally ran into resistance as well.  The high of the day was set at this point, and then the gold price got sold down about five bucks into the 5:15 p.m. close.

According to the CME, gold's high tick in the December contract was $1,287.70, and the low tick was posted as $1,251.00.

Gold closed the Tuesday session at $1,281.00 spot, which was up $7.70 from Monday's close. Volume, net of October and November, was a very large 214,000 contracts.

The chart for silver was almost identical to gold's chart, except the price was more "volatile," which means that the high-frequency traders kicked the living snot out of the price, which allowed JPMorgan et al to more buy longs and/or cover short positions.

The CME recorded the low and high of the day as $20.495 and $21.525 in the December contract.

Silver closed at $21.30 spot, up three whole cents from Monday's close, after an intraday move of a hair over 5%.  Volume, net of October and November, was a very chunky 65,000 contracts.

Platinum's price moves followed gold and silver's moves closely.  The HFT boys tried to break palladium below the $700 spot price mark, but couldn't.  Here are the charts.

The dollar index closed late on Monday afternoon in New York at 80.34, but didn't do much until 9:30 a.m. BST in London when it took off to the upside.  The high of the day [80.68] came two hours later, and the index chopped sideways before heading south at 2 p.m. in New York, about the time that gold and silver began rallying in electronic trading.

But the decline didn't amount to much, as the 'low' of 80.41 came around 4:45 p.m. EDT before rallying a handful of basis points into the close.  The index finished at 80.42, which was up a stunning 8 basis points from Monday's close.

It would take a real stretch of any person's imagination to fit the precious metal price action into what the dollar index was doing yesterday.

The gold stocks traded in a tight range either side of unchanged until about 1:30 p.m. EDT. Then a rally developed in conjunction with the tiny rally in the metal itself in electronic trading, and the HUI managed to finish on its high tick of the day, up a healthy 3.03%.

The trading pattern in the silver stocks was similar, except for the fact that the rally started sooner, and then got sold off a bit during the last hour of trading.  Nick Laird's Intraday Silver Sentiment Index closed up only 1.09%.

The CME Daily Delivery Report was a non-event, as only one gold and six silver contracts were posted for delivery on Thursday.  There's very little October open interest left in either gold or silver, so unless a surprise buyer shows up wanting immediate delivery of huge amount of either metal, the remainder of the delivery month should be very uneventful.  Yesterday's delivery action was certainly a precursor to that.

There were no reported changes in GLD yesterday, but an authorized participant withdrew another big chunk of silver from SLV.  This time it was 1,734,441 troy ounces.  About 7.5 million ounces of silver have been withdrawn from SLV since the beginning of October.

The reason the U.S. Mint didn't have a sales report on Monday was because of the Columbus Day holiday, and they made amends for that yesterday.  They sold 10,000 troy ounces of gold eagles; 5,000 one-ounce 24K gold buffaloes; and 749,500 silver eagles.

The U.S. Mint has already sold 70% more ounce of gold eagles in October than they did in all of September, and gold buffalo sales in October are already equal to all of gold buffalo sales in September.  Silver eagles sales continue to sail along at record high levels.  I sure hope you're getting your share, dear reader.

It was another nothing day for gold over at the Comex-approved depositories on Monday.  They reported receiving 289 troy ounces, and shipped 577 troy ounces out the door.  It was hardly worth their while showing up for work for that amount.  Here's the link if you wish to check it out yourself.

It was a little more active in silver, but one of the slower days as well.  They didn't report receiving any, and shipped 306,089 troy ounces of the stuff out the door for parts unknown.  Here's the link to that action, such as it was.

I have the usual number of stories for a mid-week column, and the final edit is yours.

¤ Critical Reads

U.S. AAA Rating Put on Negative Watch by Fitch on Delayed Budget

“The political brinkmanship and reduced financing flexibility could increase the risk of a U.S. default,” Fitch, which is a jointly owned subsidiary of Paris-based Fimalac SA and New York-based Hearst Corp., said today in a statement. Fitch reiterated that it expects the debt ceiling to be raised.

Treasury Secretary Jacob J. Lew has told Congress the extraordinary measures being used to avoid breaching the debt ceiling “will be exhausted no later than Oct. 17” and the department will have about $30 billion to pay obligations. Fitch said it expects to resolve its rating watch negative outlook on the U.S. by the first quarter of 2014.

“The announcement reflects the urgency with which Congress should act to remove the threat of default hanging over the economy,” according to a Treasury statement.

Triple A???  How about Triple Junk?  That's what all government debt is...U.S. debt included.  It will never be repaid...and if it is, the purchasing power of the units used to repay that debt will only be a tiny fraction of what it is today.  This Bloomberg story was posted on their website yesterday afternoon MDT...and I thank Ken Hurt for today's first story.

U.S. Consumers Curb Spending Amid Government Shutdown

Two out of five consumers said they were limiting their spending "as a result of the direct or indirect effects" of the partial federal government shutdown that began Oct. 1, said the International Council of Shopping Centers and Wall Street bank Goldman Sachs.

Of those who were curbing spending, the majority said the scale back was "a little" while the remainder indicated it was "considerable."

The weaker spending casts a cloud over retailers as they gear up for the crucial year-end holiday shopping season that accounts for a significant part of their earnings.

This news item was posted on the moneynews.com Internet site yesterday at noon EDT...and it's the first offering of the day from West Virginia reader Elliot Simon.

Just how ugly would a default be for the dollar? Very.

In an article in Project Syndicate, University of California economist Barry Eichengreen lays out the implications of a default on the world's reserve currency. The result would be a sharp drop in the dollar combined with huge losses for financial institutions.

"Even if the Treasury paid bondholders first -- choosing to stiff, say, contractors or Social Security recipients -- the idea that the U.S. government always pays its bills would no longer be taken for granted," says Eichengreen, who writes frequently about the demise of the dollar. "Holders of U.S. Treasury bonds would begin to think twice."

There would be a serious shortage of cash circulating the economy, as the electronic network operated by the U.S. Federal Reserve to transfer funds between financial institutions isn't set up to settle transactions in defaulted securities. The repo market, loans offered against Treasury bonds, would freeze up.

And mutual funds prohibited by covenant from holding defaulted securities would have to dump their Treasuries in a fire sale. And all this could threaten the health of commercial banks and undermine confidence in the Federal Deposit Insurance Corporation, which insures deposits. "Beyond the immediate financial costs, the dollar's global safe-haven status would be lost," Eichengreen writes.

This short commentary showed up on the fortune.cnn.com Internet site yesterday morning EDT...and I thank Elliot Simon for his second contribution in a row to today's column.

Central Banks Begin Gaming Out U.S. Default Before Deadline

Central banks have begun making contingency plans on how they would keep financial markets working if the U.S. defaults on the world’s benchmark debt.

Policy makers discussed possible responses when they met at the International Monetary Fund’s annual meetings in Washington over the weekend, said officials who spoke on condition of anonymity because the talks were confidential. The discussions continued as policy makers headed home.

“Because in the past it’s always been sorted out is absolutely not a reason to fail to do the contingency planning,” Jon Cunliffe, who joins the Bank of England as deputy governor for financial stability next month, told U.K. lawmakers. “I would expect the Bank of England to be planning for it. I’d expect private-sector actors to be doing that, and in other countries as well.”

This story was posted on the moneynews.com Internet site early yesterday morning EDT...and it's another offering from Elliot Simon.

Doug Casey: Lack of confidence -- U.S. government and the American dollar

This 23-minute audio interview with Doug was posted on the talkdigitalnetwork.com Internet site last Saturday...and it's certainly worth listening to.

Wal-Mart, Xerox blame each other for Louisiana food stamp shopping gone wild

Wal-Mart Stores Inc and Xerox Corp blamed each other on Monday after Louisiana food stamp recipients stripped bare the shelves of some Walmart stores when a computer glitch left their debit cards with no limits.

Managers of Wal-Mart stores in the small, north Louisiana towns of Springhill and Mansfield alerted police on Saturday night that throngs of shoppers had flooded into the stores and were buying groceries using electronic benefit cards that contained no credit limits.

When word got out Saturday that the EBT cards were showing no limits, card holders rushed to area Walmarts to take advantage.

"Some people had eight or 10 shopping carts full of groceries," Springhill Police Chief Will Lynd said on Monday.

This interesting Reuters story arrived in my in-box just after midnight on Tuesday, but didn't make the cut for yesterday's column, so here it is today.  I thank 'Tom in Thailand' for sending it our way.

JPMorgan Expected to Admit Fault in 'London Whale' Trading Loss

For JPMorgan Chase, fines totaling billions of dollars are no longer sufficient to placate the government. Now the bank's regulators want something stiffer: a mea culpa.

A month after JPMorgan acknowledged that "severe breakdowns" had allowed a group of traders in London to run up $6 billion in losses, the bank has preliminarily reached a rare agreement to admit that the trading blowup itself represented reckless behavior, according to people briefed on the negotiations.

The bank could settle with the Commodity Futures Trading Commission as soon as this week, according to the people briefed on the negotiations, who were not authorized to discuss the private settlement talks. Aside from admitting some wrongdoing, the bank is expected to pay about $100 million to resolve the case, a trading debacle last year that has come to be known as the London Whale episode.

$100 million is coffee money for JPMorgan, but one can only hope that this conviction will lead to others, as once they plead guilty, they leave themselves open to legal action.  The JPMorgan-led gold and silver price suppression scheme obviously comes to mind, if it ever comes to that.  This news item was posted on The New York Times Internet site very early yesterday evening...and I plucked it from a GATA release that Chris Powell filed from Sydney, Australia earlier today local time.  However, the first reader through the door with the story was Scott Pluschau.

U.S. to Become the World's Top Oil Producer in 2013, PIRA Says

The U.S. is expected to overtake Saudi Arabia as the world's biggest total supplier of oil this year when natural gas liquids and biofuels are added to crude, PIRA Energy Group said.

The U.S. is projected to produce an average of 12.1 million barrels a day of liquids in 2013, 300,000 barrels a day higher than Saudi Arabia and 1.6 million more than Russia, according to data presented at PIRA’s Retainer Client Seminar Oct. 10 and Oct. 11 in New York.

The U.S. position has improved because of surging “shale oil” output, the New York-based energy consultant said. The combination of horizontal drilling and hydraulic fracturing, or fracking, has unlocked supplies in shale formations in the central part of the country. Shale liquids output has climbed 3.2 million barrels a day in the last four years, the biggest gain since Saudi Arabia raised production between 1970 and 1974.

This interesting news item showed up on the moneynews.com Internet site yesterday afternoon EDT...and it's another offering from Elliot Simon.

NSA collects millions of e-mail address books globally

The National Security Agency is harvesting hundreds of millions of contact lists from personal e-mail and instant messaging accounts around the world, many of them belonging to Americans, according to senior intelligence officials and top-secret documents provided by former NSA contractor Edward Snowden.

The collection program, which has not been disclosed before, intercepts e-mail address books and “buddy lists” from instant messaging services as they move across global data links. Online services often transmit those contacts when a user logs on, composes a message, or synchronizes a computer or mobile device with information stored on remote servers.

During a single day last year, the NSA’s Special Source Operations branch collected 444,743 e-mail address books from Yahoo, 105,068 from Hotmail, 82,857 from Facebook, 33,697 from Gmail and 22,881 from unspecified other providers, according to an internal NSA PowerPoint presentation. Those figures, described as a typical daily intake in the document, correspond to a rate of more than 250 million a year.

There's no date or time on this 3-page essay in The Washington Post, but it's from either Monday or Tuesday...and I thank Roy Stephens for sending it.

Watch what China does with U.S. debt, not what it says

So much for the hot rhetoric from Beijing questioning the creditworthiness of US debt and consigning the US dollar to the dustbin of history.

The latest data shows that China's foreign reserves soared by $163bn in the third quarter to $3.66 trillion, one of the biggest jumps ever.

Mark Williams and Qinwei Wang from Capital Economic called the rise "astonishing". They estimate that China's central bank must have bought $70bn of foreign bonds last month in a frantic bid to hold down the currency.

We won't know for a while where the money went, but a big chunk must have gone into US Treasuries. So bear that in mind when you read the Xinhua claims that the US debt ceiling fight "has again left many nations' tremendous dollar assets in jeopardy and the international community highly agonised."

This must read commentary from Ambrose Evans-Pritchard was posted on the telegraph.co.uk Internet site yesterday...and I thank Manitoba reader Ulrike Marx for her first contribution to today's column.

Four King World News Blogs

1. William Kaye [#1]: "There is No Question That We Are Now in the End Game".   2. John Embry [#1]: "There is No Rule of Law in

Just how ugly would a default be for the dollar? Very.

Posted: 16 Oct 2013 02:28 AM PDT

Just how ugly would a default be for the dollar? Very.

In an article in Project Syndicate, University of California economist Barry Eichengreen lays out the implications of a default on the world's reserve currency. The result would be a sharp drop in the dollar combined with huge losses for financial institutions.

"Even if the Treasury paid bondholders first -- choosing to stiff, say, contractors or Social Security recipients -- the idea that the U.S. government always pays its bills would no longer be taken for granted," says Eichengreen, who writes frequently about the demise of the dollar. "Holders of U.S. Treasury bonds would begin to think twice."

There would be a serious shortage of cash circulating the economy, as the electronic network operated by the U.S. Federal Reserve to transfer funds between financial institutions isn't set up to settle transactions in defaulted securities. The repo market, loans offered against Treasury bonds, would freeze up.

And mutual funds prohibited by covenant from holding defaulted securities would have to dump their Treasuries in a fire sale. And all this could threaten the health of commercial banks and undermine confidence in the Federal Deposit Insurance Corporation, which insures deposits. "Beyond the immediate financial costs, the dollar's global safe-haven status would be lost," Eichengreen writes.

This short commentary showed up on the fortune.cnn.com Internet site yesterday morning EDT...and I thank Elliot Simon for his second contribution in a row to today's column.

Doug Casey: Lack of confidence -- U.S. government and the American dollar

Posted: 16 Oct 2013 02:28 AM PDT

Doug Casey: Lack of confidence -- U.S. government and the American dollar

This 23-minute audio interview with Doug was posted on the talkdigitalnetwork.com Internet site last Saturday...and it's certainly worth listening to.

JPMorgan Expected to Admit Fault in 'London Whale' Trading Loss

Posted: 16 Oct 2013 02:28 AM PDT

JPMorgan Expected to Admit Fault in 'London Whale' Trading Loss

For JPMorgan Chase, fines totaling billions of dollars are no longer sufficient to placate the government. Now the bank's regulators want something stiffer: a mea culpa.

A month after JPMorgan acknowledged that "severe breakdowns" had allowed a group of traders in London to run up $6 billion in losses, the bank has preliminarily reached a rare agreement to admit that the trading blowup itself represented reckless behavior, according to people briefed on the negotiations.

The bank could settle with the Commodity Futures Trading Commission as soon as this week, according to the people briefed on the negotiations, who were not authorized to discuss the private settlement talks. Aside from admitting some wrongdoing, the bank is expected to pay about $100 million to resolve the case, a trading debacle last year that has come to be known as the London Whale episode.

$100 million is coffee money for JPMorgan, but one can only hope that this conviction will lead to others, as once they plead guilty, they leave themselves open to legal action.  The JPMorgan-led gold and silver price suppression scheme obviously comes to mind, if it ever comes to that.  This news item was posted on The New York Times Internet site very early yesterday evening...and I plucked it from a GATA release that Chris Powell filed from Sydney, Australia earlier today local time.  However, the first reader through the door with the story was Scott Pluschau.

Watch what China does with U.S. debt, not what it says

Posted: 16 Oct 2013 02:28 AM PDT

Watch what China does with U.S. debt, not what it says

So much for the hot rhetoric from Beijing questioning the creditworthiness of US debt and consigning the US dollar to the dustbin of history.

The latest data shows that China's foreign reserves soared by $163bn in the third quarter to $3.66 trillion, one of the biggest jumps ever.

Mark Williams and Qinwei Wang from Capital Economic called the rise "astonishing". They estimate that China's central bank must have bought $70bn of foreign bonds last month in a frantic bid to hold down the currency.

We won't know for a while where the money went, but a big chunk must have gone into US Treasuries. So bear that in mind when you read the Xinhua claims that the US debt ceiling fight "has again left many nations' tremendous dollar assets in jeopardy and the international community highly agonised."

This must read commentary from Ambrose Evans-Pritchard was posted on the telegraph.co.uk Internet site yesterday...and I thank Manitoba reader Ulrike Marx for her first contribution to today's column.

Peter Grandich: The gold mining industry is pretty useless, Grandich laments

Posted: 16 Oct 2013 02:28 AM PDT

Peter Grandich: The gold mining industry is pretty useless, Grandich laments

While my heart would like to say much more than “go fly a kite” to the absolute idiots who say gold isn’t manipulated (yet another market receives charges of manipulation but we’re to believe somehow the manipulation stops at the Comex/Crimex doors), the bottom line is there are forces at work in the paper gold market who effectively have a nuclear arsenal while the good people at GATA (thanks to a gold industry who has cut their nose to spite their faces by neglecting the one group who could do more for them than all their horrible management has done for themselves up to now) have had to counter with pea-shooters (and I’m sorry I haven’t done more for them).

His feeling about the precious metal mining companies echo mine exactly.  This short commentary by Peter was posted on his website yesterday...and I found it in a GATA release.

Alasdair Macleod: Valuing gold

Posted: 16 Oct 2013 02:28 AM PDT

Alasdair Macleod: Valuing gold

Using his measure of fiat money quantity, GoldMoney research director Alasdair Macleod argues that gold is grossly underpriced in the face of the increasing likelihood of monetary hyperinflation.

Macleod's commentary, complete with chart, is headlined "Valuing Gold" and it's posted at GoldMoney's Internet site.

Mysterious Gold Seller Is Back With Periodic High Volume Slams, Fails To Break Market

Posted: 16 Oct 2013 02:28 AM PDT

Mysterious Gold Seller Is Back With Periodic High Volume Slams, Fails To Break Market

Unlike on the two prior occasions when the "mysterious" (coughBIScough) gold seller sold so much gold he briefly broke the gold market not once but twice, this morning's concerted gold selling episodes, which briefly took gold to a three month low, were unable to obliterate the entire bid stack (at least for now) and crush enough liquidity to force the CME to announce another "stop logic" 10-20 second trading halt.

However, there were some other peculiarities surrounding today's now recurring morning gold battering (which as we noted in a market where the CME no longer supervises any and all manipulation, were and are certain to continue). Specifically, what is curious is that starting at 3:48 am Eastern Time, Nanex found "six instances (there may be more) of 1 second periods in Gold futures with a high number of trades (700 or more)." As those who have been covering our coverage of HFT manipulation will note, these are precisely the kinds of momentum ignition, and not rational price discovery, events that seek to manipulate prevailing prices lower (or higher).

I commented on this in more general terms in The Wrap in yesterday's column, but the commentary and charts from Nanex really drill down into the obvious conclusion that the price decline that occurred in London yesterday morning was man-made.  This Zero Hedge piece, with some excellent [time] charts is a must read...and it's the second offering of the day from Ulrike Marx.

Gold premiums hit record in India

Posted: 16 Oct 2013 02:28 AM PDT

Gold premiums hit record in India

Gold premiums in India, the world's biggest buyer of the precious metal, hit a record $100 an ounce, about 8 percent over London prices, on a shortage of supplies to meet festival demand, traders said on Tuesday.

Banks, the primary dealers of bullion, are currently importing the yellow metal chiefly for exporters, as under the so-called 80/20 principle, jewellery exporters get priority for supplies over domestic manufacturers.

The principle, part of a package of measures announced in July aimed at cutting India's current account deficit by reducing gold imports, states that 20 percent of all gold imported into India must be re-exported.

This news item was posted on India's Business Standard website early yesterday evening IST...and it's another contribution from Ulrike Marx.  It's worth the read.

India needs a national gold policy

Posted: 16 Oct 2013 02:28 AM PDT

India needs a national gold policy

In what is good news for the Indian economy, gold imports have declined significantly in the first half of this fiscal. The decline may have been a blessing in disguise, but challenges remain in containing gold imports in rest of the year. For example, historical trends suggest that close to 40% of the imports take place in the period from October to January. These facts suggest that a national policy on gold is a more appropriate approach to find a long-term solution instead of ad hoc fiscal measures such as raising import duty on gold. This is not a new idea as comprehensive policy on gold had taken seed at the start of the financial sector reforms in 1991-92 when the import of gold was liberalized.

Gold is a surrogate for foreign exchange and is a hybrid between a commodity and a financial asset. Thus in a liberalized regime, comprehensive policy on gold is also linked to capital account convertibility (CAC). The Tarapore committee report had also recommended among other things a comprehensive policy on gold as a precondition to CAC. The stress was on the need to develop gold-related financial products. Another crucial element in respect to gold policy is how such a policy should be integrated with financial sector reforms and CAC.

This is such b.s. "Gold is money, and nothing else" said J.P. Morgan the man over a hundred years ago, and nothing has changed since.  This commentary was written by the chief economic adviser to the State Bank of India, so you know that this scheme in the best interests of the Indian people.  So read it with that in mind, if you decide to read it at all, that is. It was posted on the livemint.com Internet site early yesterday evening India Standard Time.  My thank go out to Ulrike Marx once again.

Indian sage dreams of gold to save economy, government starts digging

Posted: 16 Oct 2013 02:28 AM PDT

Indian sage dreams of gold to save economy, government starts digging

The Indian government is digging for treasure after a civic-minded Hindu village sage dreamt that 1,000 tons of gold was buried under a ruined palace, and wrote to tell the central bank about it.

The state Archaeological Survey of India has sent a team of archaeologists to the village of Daundia Khera in the northern state of Uttar Pradesh. They are due to start digging on Friday, Praveen Kumar Mishra, the head archaeologist in the state, told Reuters.

Yogi Swami Shobhan Sarkar says the gold he dreamt of belonged to a nineteenth-century ruler, Rao Ram Bux Singh. He says he wants it in government hands to help India recover from an economic crisis.

"I cried the day I realized that India is going to collapse economically," the seer told the Mail Today newspaper. The dead ruler's spirit has been roaming the palace and asking for the gold to be dug up, he added.

You couldn't make this stuff up!  Ulrike Marx suggested that I post this under "The Funnies" section of today's column.  I would have, except it has no cute picture.  This Reuters piece was posted on their website early Tuesday morning IST.

Chinese gold output to August up 8% year on year

Posted: 16 Oct 2013 02:28 AM PDT

Chinese gold output to August up 8% year on year

Output from the world's largest gold producer, China has advanced sharply, up 8.18% year on year to 270.167 tonnes from January to August 2013, according to data released by the China Gold Association. In August 2013, the country produced 37.978 tonnes of gold.

Bullion consumption too has jumped, rising 54% in the first six months of 2013, from a year ago period. Last year, China’s gold consumption rose 9.35% to 832.18 metric tonnes and the country is slated to overtake India to become the biggest gold consumer this year.

The Association said some 220.77 tonnes of gold was mined, 6.03% more than last year, with 39.367 tonnes of gold produced in the month of July alone.

This story, filed from Mumbai, was posted on the mineweb.com Internet site in the wee hours of this morning...and I thank Ulrike Marx for her final offering in today's column.

Silver Forecast October 16, 2013, Technical Analysis

Posted: 16 Oct 2013 01:50 AM PDT

fxempire

Gold Prices October 16, 2013, Technical Analysis

Posted: 16 Oct 2013 01:35 AM PDT

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