Gold World News Flash |
- What Blows Up First? Part 2: Japan
- Silver, Gold and S&P: Trend Change Due
- Gold funds hit 2008 level ahead of US Fed action
- Gold funds hit 2008 level ahead of US Fed action
- China Services PMI Crumbles To 2nd Worst Level On Record
- The Great Gold Robbery
- 2014-Crisis in Dollar Will Trigger Inflation-John Williams
- In The News Today
- Nearly TWO THIRDS of 2013 Government Waste, Fraud Came from HHS
- Join GATA at its reception following the Vancouver conference Jan. 20
- Weekend Report...Gold is Speaking Through its Chartology..Let's Listen In ...
- David Morgan's 2014 Silver Survival Guide
- China Services PMI Crumbles To 2nd Worst Level On Record
- What Blows Up First? Part 2: Japan
- Weekly Sentiment Report: It's Just a Number
- Brian Pretti: The World's Capital Is Now Dangerously Boxed In
- Precious Metals In 2014
- The Great Gold Robbery
- The Gold Bull Market is Not Dead...
- Comex Warehouses: Potential Claims On Deliverable Bullion at Historically High 80 to 1
- Comex Warehouses: Potential Claims On Deliverable Bullion at Historically High 80 to 1
- Gold Investors Weekly Review – January 3d
- In The News Today
| What Blows Up First? Part 2: Japan Posted: 06 Jan 2014 12:00 AM PST by John Rubino, Dollar Collapse:
Of all the crazy financial stories of the past year, Japan's might be the craziest. To recap: For two decades, successive Japanese governments have fought the deflationary effects of bursting real estate and stock bubbles with ever-larger public works programs. These prevented the collapse of the country's zombie banks and construction firms but didn't produce the kind of growth necessary to bring the zombies back to life. The sustained deficit spending did, however, produce a public debt that as a percentage of GDP dwarfs even those of the US and Europe. So in 2013 incoming Prime Minister Shinzo Abe demanded that the Bank of Japan inject enough credit into the banking system to produce at least 2% inflation. | |
| Silver, Gold and S&P: Trend Change Due Posted: 05 Jan 2014 11:05 PM PST Date written: January 2, 2014 Read the Latest News About: Gold Silver Economy Central Banking The year 2013 was a great year for... {This is a content summary only. Click on the blog title to continue reading this post, share your comments, browse the website, and more!} | |
| Gold funds hit 2008 level ahead of US Fed action Posted: 05 Jan 2014 10:00 PM PST Investors in gold brace for a cycle of monetary tightening by the Fed, typically a headwind for gold and commodities 
This posting includes an audio/video/photo media file: Download Now | |
| Gold funds hit 2008 level ahead of US Fed action Posted: 05 Jan 2014 10:00 PM PST Investors in gold brace for a cycle of monetary tightening by the Fed, typically a headwind for gold and commodities 
This posting includes an audio/video/photo media file: Download Now | |
| China Services PMI Crumbles To 2nd Worst Level On Record Posted: 05 Jan 2014 10:00 PM PST from ZeroHedge:
This is also the slowest ‘expansion’ of Services relative to Manufacturing since April 2011 | |
| Posted: 05 Jan 2014 09:36 PM PST from KingWorldNews:
My how things have NOT changed. We are going through the final chapters of what must now take the title as "The Greatest Gold Robbery". As with the first one, it required an inside job to accomplish, but the magnitude of the theft is breathtaking. As massive amounts of gold continue to flow from West to East, what little gold remains is rapidly being depleted by both legitimate and illegitimate means. | |
| 2014-Crisis in Dollar Will Trigger Inflation-John Williams Posted: 05 Jan 2014 08:42 PM PST By Greg Hunter's USAWatchdog.com (Early Sunday Release) Dear CIGAs, Economist John Williams thinks 2014 will mark the beginning of hyperinflation. Williams contends, "You are going to see, early on, a crisis in the dollar that will start to trigger the inflation . . . as the inflation picks up, that's going to savage the economy,... Read more » The post 2014-Crisis in Dollar Will Trigger Inflation-John Williams appeared first on Jim Sinclair's Mineset. | |
| Posted: 05 Jan 2014 08:40 PM PST Jim Sinclair's Commentary They have decided on a common currency now to be linked to the dollar, but easily switched to the yuan. Arab monarchies eye stronger ties with China Thursday, December 26, 2013 RIYADH: The six energy-rich Arab monarchies of the Gulf are seeking to strengthen ties with China, Gulf Cooperation... Read more » The post In The News Today appeared first on Jim Sinclair's Mineset. | |
| Nearly TWO THIRDS of 2013 Government Waste, Fraud Came from HHS Posted: 05 Jan 2014 08:20 PM PST [Ed. Note: ...Good thing these people now control 1/6th of the U.S. economy through Obamacare...] by Edwin Mora, Breitbart:
On Dec. 31, FederalTimes.com reported the estimated government-wide improper payments dollar figure for fiscal 2013, citing Frank Benenati, an OMB spokesman as the source. Benenati did not provide a breakdown of the 2013 payment errors by government program, saying that information would not be available for weeks, according to the FederalTimes.com article. | |
| Join GATA at its reception following the Vancouver conference Jan. 20 Posted: 05 Jan 2014 08:20 PM PST 11:20p ET Sunday, January 5, 2014 Dear Friend of GATA and Gold: At the close of the Vancouver Resource Investment Conference on Monday, January 20, GATA's delegation -- Chairman Bill Murphy, board member Ed Steer, and your secretary/treasurer -- once again will hold an informal reception starting at 5 p.m. at the Lions Pub, 888 West Cordova St., a short walk from the conference venue, the Vancouver Convention Centre West. All friends of GATA are invited. There will be a cash bar and, if the GATA delegation doesn't beat you to them, some free snacks. The Lions Pub is a warm and cozy place in the heart of downtown Vancouver -- http://www.tcclub.com/Lions-Pub.aspx -- and we hope to see many old and new friends there. The GATA delegation will be speaking at the conference as well, and admission there will be free for those who register in advance. To learn all about the conference and register for it, visit its Internet site here: http://www.cambridgehouse.com/event/vancouver-resource-investment-confer... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Jim Sinclair plans seminar in Austin on Feb. 8 Gold advocate and mining entrepreneur Jim Sinclair will hold his next market seminar at the Austin, Texas, Airport Hilton from 2 to 6 p.m. on Saturday, February 8. Advance registration is required. Details are posted at Sinclair's Internet site, JSMineSet, here: http://www.jsmineset.com/2014/01/02/austin-texas-qa-session-confirmed/ Join GATA here: Vancouver Resource Investment Conference http://www.cambridgehouse.com/event/vancouver-resource-investment-confer... Mines and Money Hong Kong http://www.minesandmoney.com/hongkong/ * * * Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006: http://www.goldrush21.com/order.html Or by purchasing a colorful GATA T-shirt: Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: ADVERTISEMENT How to profit with silver -- Future Money Trends is offering a special 16-page silver report with our forecast for 2013 that includes profiles of nine companies and technical analysis of their stock performance. Six of the companies have market capitalizations of less than $800 million and one company has a market cap of only $30 million. The most exciting of these companies will begin production in a few weeks and has a market cap of just $150 million. Half of all proceeds from the sale of this report will be donated to the Gold Anti-Trust Action Committee to support its efforts exposing manipulation and fraud in the gold and silver markets. To learn about this report, please visit: http://www.futuremoneytrends.com/index.php?option=com_content&id=376&tmp... | |
| Weekend Report...Gold is Speaking Through its Chartology..Let's Listen In ... Posted: 05 Jan 2014 08:06 PM PST In this Weekend Report I would like to take an indepth look at gold that is showing a potential small double bottom. There is also a larger double bottom or part of a bigger consolidation pattern that also needs to be looked at. Read More... | |
| David Morgan's 2014 Silver Survival Guide Posted: 05 Jan 2014 07:34 PM PST David Morgan is on the show today to tell you what to expect from the silver market in 2014. David gives us an excellent education in the world of silver for investment purposes as well as for... [[ This is a content summary only. Visit http://www.GoldSilverNewsBlog.com or http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]  | |
| China Services PMI Crumbles To 2nd Worst Level On Record Posted: 05 Jan 2014 06:52 PM PST Following the missed expectations of the Manufacturing PMIs in China, it appears 'reform' is having the exact slow-growth-inducing credit-creation-dampening effects many had worried about (but dismissed because - well the Fed has out back right?). HSBC's China Services PMI slumped by its most in 8 months to its lowest level since August 2011 (the 2nd worst level since the data began). New business expansion in particular dropped to its lowest level in 6 months and while labor market conditions improved marginally, HSBC - desperate to cling to some silver lining - noted the Composite PMI remains above 50 (phew) - adding "we expect the steady expansion of manufacturing sectors to lend support to service sector growth..." or not. Markets are disappointed...
It seems JPY and US equities need Bernanke to start talking again very soon!!!
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| What Blows Up First? Part 2: Japan Posted: 05 Jan 2014 05:36 PM PST Of all the crazy financial stories of the past year, Japan's might be the craziest. To recap: For two decades, successive Japanese governments have fought the deflationary effects of bursting real estate and stock bubbles with ever-larger public works programs. These prevented the collapse of the country's zombie banks and construction firms but didn't produce the kind of growth necessary to bring the zombies back to life. The sustained deficit spending did, however, produce a public debt that as a percent of GDP dwarfed even those of the US and Europe. So in 2013 incoming Prime Minister Shinzo Abe demanded that the Bank of Japan inject enough credit into the banking system to produce at least 2% inflation. The bank acquiesced and in the space of less than a year more than doubled the size of its balance sheet by buying bonds on the open market with newly-created currency. Now here's where it gets strange. While this massive debt monetization program was ramping up, Abe and company began to worry about their ongoing deficits. So they raised the national sales tax to 10% in order to generate more revenue. But of course higher consumption taxes are deflationary, thus counteracting the Bank of Japan's inflationary debt monetization. So the government then decided to aggressively increase public works and military spending, which means it will henceforth take in more money and spend nearly all of it, leaving the country with unsustainably-high deficits and a bigger, more intrusive government. In other words, a lot of effort has been expended to no real purpose, while the debt keeps mounting and government officials keep saying ever-more-senseless things to obscure the above facts. See this, from late December:
Some thoughts "Revenue from bond sales will pay for 43 percent of next year's budget, down from 46.3 percent this year…" This means that, far from reigning in its excesses, the government will again borrow nearly half of its budget. This would be the equivalent of the US borrowing $1.5 trillion, something that would not be considered progress by most observers outside of the New York Times' editorial department. "Debt-servicing costs — including interest payments for outstanding bond issuance — will rise to 23.3 trillion yen from 22.2 trillion yen this year…" That comes to about a fourth of Japan’s federal budget, and is rising. The dilemma is clear: Japan has to keep spending to satisfy its growing population of retirees, offset the effects of higher taxes and counter China’s military build-up. And a big part of that spending has to be borrowed. But government debt of 220% of GDP and interest expense at 24% of the budget is already way too much, so the systemic implosion is just a matter of people figuring this out. And that could be triggered in 2014 by lots of things, including a slight uptick in interest rates that sends interest expense above 25% of the budget, a confrontation with China over the islands they both claim, or a slowdown in a major export market like Europe. The result: a sudden loss of confidence in yen that raises Japanese borrowing costs and forces the government to sell some its Treasury bonds, thus exporting its crisis to the US. | |
| Weekly Sentiment Report: It's Just a Number Posted: 05 Jan 2014 04:08 PM PST IntroductionI saw this headline (or something to the effect) somewhere: "Number of Bullish Newsletter Writers Highest Since 2007 Top". Ahhh....run for the hills! To see more proprietary market data, visit TacticalBeta; it is absolutely,100% FREE!! Go to TacticalBeta Now! The percentage of bullish newsletter writers in the Investors Intelligence sentiment poll now sits at 61.2. This is the highest value since October, 2007, which is exactly 1 week after the SP500 peaked and then went on to drop over 50% in the next 18 months. There must be some meaning to this number. Right? However, as I showed in the article, "Weekly Sentiment Report: A Noteworthy Extreme (This Is Not What You Think)", such extremes in the sentiment data are just that-- extremes in the data. So while greater than 60% bullish newsletter writers was seen at the 2007 top, this number was also seen throughout the history of the data series and the market did not fall apart or find itself in a bear market over the next year. See figure 1 of examples over the past 15 years. In fact, having lots of bulls, like having extremes in the number of bears, generally does not imply what you think. Certainly, I would not run for the hills based upon 1 number. Figure 1. % Bullish Newsletter Writers/ weekly
But this should not imply a green light or an "all clear" signal either. From our perspective, I would rather be a buyer (as the data supports) when investors are bearish, and I would rather be a seller when they are bullish. At this point in the price cycle, the trend of prices should begin to flatten out. Rather than being a seller at some extreme point, we typically wait until investor sentiment unwinds. More specifically, we will sell our equity positions 1 week after the "dumb money" indicator crosses below the upper trading band. See figure 4 (below) for details. The extremes in bullish sentiment that we are currently seeing really suggest that we are late in the current price move. Furthermore, I can certainly state that there are issues under the surface. One issue is the willingness of investors to buy the dip on shorter and shorter time frames. In essence, a market that doesn't periodically clear itself of the weak hands (i.e., a big, nasty sell off) is a market built on a weak foundation. A second issue is the negative divergence that we are seeing between the $VIX and the SP500. As prices go higher, we should expect the $VIX to move lower, but the $VIX has been unable to break below a level of 12 over the past 12 months despite the near 30% gain in the SP500. As figure 2 below shows, selling has occurred when the $VIX tags the 12 level, but from a big picture perspective, the $VIX has failed to confirm the price move in the SP500. Furthermore, a weekly close above 14.64 on the $VIX would highly suggest a deeper and prolonged sell off in prices. I discussed the implications of support and resistance in the $VIX in this video back in September, 2013. Figure 2. $VIX/ weekly
Our equity model, which is built around the "dumb money" indicator (see figure 4 below), remains bullish, and will likely remain so for another 2 weeks or more. This current trade has gone on for 17 weeks now when we became bullish during a period of extreme investor bearishness, and it is our expectation that this trade should last on average 15 weeks. The best, most accelerated gains typically occur in the beginning of the trade. Just when investors typically get the all clear, the trend will flatten out. Our plan is to become sellers of equities when investor sentiment unwinds, but we are not at that point. As a reminder, we have moved our stop loss up to SP500 1706.92. In the final analysis, there are reasons for concern as investors have become and remain extremely bullish. Would I run for the hills? Not yet, but with every passing week, we are getting closer to that point. That's the conundrum investors must face if they want in to this market now. The Sentimeter | |
| Brian Pretti: The World's Capital Is Now Dangerously Boxed In Posted: 05 Jan 2014 03:35 PM PST Submitted by Adam Taggart via Peak Prosperity,
This week Chris speaks with Brian Pretti, managing editor of ContraryInvestor.com, a financial commentary site published by institutional buy-side portfolio managers. In their discussion, they focus on the global movement of capital since quantitative easing (QE) became the policy of the world's major central banks. The ensuing excellent discussion is wide ranging, but the key takeaway is that capital is being herded into fewer and fewer asset classes. With such huge volumes of money at play, very crowded trades in assets like stocks and housing have resulted -- bringing us back to familiar bubble territory in record time. The key for the individual, Pretti emphasizes, is risk management. The safety many investors believe they are buying in today's markets is not real. The Housing Market Is a One-Sided Investment Cycle
The Box Global Capital Is Now In
Click the play button below to listen to Chris' interview with Brian Pretti (101m:31s): Click here to read the full transcript | |
| Posted: 05 Jan 2014 01:18 PM PST Submitted by Alasdair Macleod via GoldMoney.com, It's that time of year again; when we must turn our thoughts to the dangers and opportunities of the coming year. They are considerable and multi-faceted, but instead of being drawn into the futility of making forecasts I will only offer readers the barest of basics and focus on the corruption of currencies. My conclusion is the overwhelming danger is of currency destruction and that gold is central to their downfall. As we enter 2014 mainstream economists relying on inaccurate statistics, many of which are not even relevant to a true understanding of our economic condition, seem convinced that the crises of recent years are now laid to rest. They swallow the line that unemployment is dropping to six or seven per cent, and that price inflation is subdued; but a deeper examination, unsubtly exposed by the work of John Williams of Shadowstats.com, shows these statistics to be false. If we objectively assess the state of the labour markets in most welfare-driven economies the truth conforms to a continuing slump; and if we take a realistic view of price increases, including capital assets, price inflation may even be in double figures. The corruption of price inflation statistics in turn makes a mockery of GDP numbers, which realistically adjusted for price inflation are contracting. This gloomy conclusion should come as no surprise to thoughtful souls in any era. These conditions are the logical outcome of the corruption of currencies. I have no doubt that if in 1920-23 the Weimar Republic used today's statistical methodology government economists would be peddling the same conclusions as those of today. The error is to believe that expansion of money quantities is a cure-all for economic ills, and ignore the fact that it is actually a tax on the vast majority of people reducing both their earnings and savings. This is the effect of unsound money, and with this in mind I devised a new monetary statistic in 2013 to quantify the drift away from sound money towards an increasing possibility of monetary collapse. The Fiat Money Quantity (FMQ) is constructed by taking account of all the steps by which gold, as proxy for sound money, has been absorbed over the last 170 years from private ownership by commercial banks and then subsequently by central banks, all rights of gold ownership being replaced by currency notes and deposits. The result for the US dollar, which as the world's reserve currency is today's gold's substitute, is shown in Chart 1.
The graphic similarities with expansions of currency quantities in the past that have ultimately resulted in monetary and financial destruction are striking. Since the Lehman crisis the US authorities have embarked on their monetary cure-all to an extraordinary degree. We are being encouraged to think that the Fed saved the world in 2008 by quantitative easing, when the crisis has only been concealed by currency hyper-inflation. Are we likely to collectively recognise this error and reverse it before it is too late? So long as the primary function of central banks is to preserve the current financial system the answer has to be no. An attempt to reduce the growth rate in the FMQ by minimal tapering has already raised bond market yields considerably, threatening to derail monetary policy objectives. The effect of rising bond yields and term interest rates on the enormous sums of government and private sector debt is bound to increase the risk of bankruptcies at lower rates compared with past credit cycles, starting in the countries where the debt problem is most acute. With banks naturally reluctant to take on more lending-risk in this environment, rising interest rates and bond yields can be expected to lead to contracting bank credit. Does the Fed stand aside and let nature take its course? Again the answer has to be no. It must accelerate its injections of raw money and grow deposits on its own balance sheet to compensate. The underlying condition that is not generally understood is actually as follows: The assumption that the Fed is feeding excess money into the economy to stimulate it is incorrect. I have laid down the theoretical reasons why this is so by showing that welfare-driven economies, fully encumbered by debt, through false employment and price-inflation statistics are concealing a depressive slump. An unbiased and informed analysis of nearly all currency collapses shows that far from being the product of deliberate government policy, they are the result of loss of control over events, or currency inflation beyond their control. I expect this to become more obvious to markets in the coming months. Gold's important role Gold has become undervalued relative to fiat currencies such as the US dollar, as shown in the chart below, which rebases gold at 100 adjusted for both the increase in above-ground gold stocks and US dollar FMQ since the month before the Lehman Crisis.
Given the continuation of the statistically-concealed economic slump, plus the increased quantity of dollar-denominated debt, and therefore since the Lehman Crisis a growing probability of a currency collapse, there is a growing case to suggest that gold should be significantly higher in corrected terms today. Instead it stands at a discount of 36%. This undervaluation is likely to lead to two important consequences. Firstly, when the tide for gold turns it should do so very strongly, with potentially catastrophic results for uncovered paper markets. The last time this happened to my knowledge was in September 1999, when central banks led by the Bank of England and the Fed rescued the London gold market, presumably by making bullion available to distressed banks. The scale of gold's current undervaluation and the degree to which available monetary gold has been depleted suggests that a similar rescue of the gold market cannot be mounted today. The second consequence is to my knowledge not yet being considered at all. The speed with which fiat currencies could lose their purchasing power might be considerably more rapid than, say, the collapse of the German mark in 1920-23. The reason this may be so is that once the slide in confidence commences, there is little to slow its pace. In his treatise "Stabilisation of the Monetary Unit – From the Viewpoint of Monetary Theory" written in January 1923, Ludwig von Mises made clear that "speculators actually provide the strongest support for the position of notes (marks) as money". He argued that considerable quantities of marks were acquired abroad in the post-war years "precisely because a future rally in the mark's exchange rate was expected. If these sums had not been attracted abroad they would have necessarily led to an even steeper rise in prices on the domestic market". At that time other currencies, particularly the US dollar, were freely exchangeable with gold, so foreign speculators were effectively selling gold to buy marks they believed to be undervalued. Today the situation is radically different, because Western speculators have sold nearly all the gold they own, and if you include the liquidation of gold paper unbacked by physical metal, in a crisis they will be net buyers of gold and sellers of currencies. Therefore it stands to reason that gold is central to a future currency crisis and that when it happens it is likely to be considerably more rapid than the Weimar experience. I therefore come to two conclusions for 2014: that we are heading towards a second and unexpected financial and currency crisis which can happen at any time, and that the lack of gold ownership in welfare-driven economies is set to accelerate the rate at which a collapse in purchasing power may occur.
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| Posted: 05 Jan 2014 01:04 PM PST  On the heels of unprecedented actions being taken across the globe, today 40-year veteran Robert Fitzwilson warns KWN readers about the "Great Gold Robbery" that is taking place in the West. He also discusses how this is beginning to impact major markets. Fitzwilson, who is founder of The Portola Group, put together the following tremendous piece below exclusively for King World News.This posting includes an audio/video/photo media file: Download Now | |
| The Gold Bull Market is Not Dead... Posted: 05 Jan 2014 12:40 PM PST Many analysts today claim that Gold is dead as an investment due to its having fallen from a record high of $1900 per ounce to roughly $1200 per ounce today (a 36% drop).
However, this price movement, while dramatic, is quite inline with how commodities trade. Gold has already posted one drop of 28% (in 2008) during its bull market, before more than doubling in price. This latest drop is not much larger.
Moreover, a 36% drop in prices is nothing in comparison to what happened during that last great bull market in Gold back in the 1970s. At that time, Gold staged a collapse of nearly 50%. But after this collapse, it began its next leg up, exploding 750% higher from August ’76 to January 1980.
With that in mind, I believe the next leg up in Gold could very well be the BIG one. Indeed, based on the US Federal Reserve’s money printing alone Gold should be at $1800 per ounce today.
Since the Crash hit in 2008, the price of Gold has been very closely correlated to the Fed’s balance sheet expansion. Put another way, the more money the Fed printed, the higher the price of Gold went.
Gold did become overextended relative to the Fed’s balance sheet in 2011 when it entered a bubble with Silver. However, with the Fed now printing some $85 billion per month, the precious metal is now significantly undervalued relative to the Fed’s balance sheet.
Indeed, for Gold to even realign based on the Fed’s actions, it would need to be north of $1,800. That’s a full 30% higher than where it trades today (see below).
Make no mistake, gold is not dead. Not by any means. The day is coming when its price will soar again.
For a FREE Special Report on a uniquely profitable inflation hedge, swing by…. http://phoenixcapitalmarketing.com/goldmountain.html
Best Regards Graham Summers
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| Comex Warehouses: Potential Claims On Deliverable Bullion at Historically High 80 to 1 Posted: 05 Jan 2014 09:05 AM PST | |
| Comex Warehouses: Potential Claims On Deliverable Bullion at Historically High 80 to 1 Posted: 05 Jan 2014 09:05 AM PST | |
| Gold Investors Weekly Review – January 3d Posted: 05 Jan 2014 02:31 AM PST In his weekly market review, Frank Holmes of the USFunds.com nicely summarizes for gold investors this week's strengths, weaknesses, opportunities and threats in the gold market. The price of the yellow metal went lower after two consecutive weeks of gains. Gold closed the week at $1,236.90, up $23.55 per ounce (1.94%). The NYSE Arca Gold Miners Index went 3.17% higher on the week. This was the gold investors review of past week. Gold Market StrengthsDespite net Chinese gold imports through Hong Kong falling below the 100-ton level in November, Chinese net gold imports remain on track to reach well over 1,100 tonnes in 2013. That is almost double the amount imported in 2012. According to figures by the Shanghai Gold Exchange, total gold imports through Hong Kong and throughout other routes may be in excess of 2,000 tonnes. Domestic and international demand has been strong for both gold and silver. The U.S. Mint started 2014 with strong sales of gold coins, extending last year's sales strength and representing a 14 percent increase year-over-year. On January 2, there were 37,500 ounces of gold coins sold, which is equal to 25 percent of all sales during January 2013. Gold sales from Australia climbed 41 percent last year with gold coins and minted bars climbing to 754,635 ounces in 2013, up from 533,000 ounces a year earlier. Turkey's gold imports increased 64 percent in December to 31.6 tonnes. Russian lenders purchased 181.4 tonnes of Russian-produced gold in 2013, representing an 8.3 percent increase year-over-year and 90 percent of the country's production. The sale of silver coins in the U.S. rose to a record of 42.675 million ounces in 2013 from 33.743 million ounces in 2012. Australia's silver coins sales surged by 33 percent in 2013. In Turkey, imports of silver rose to 41.6 metric tonnes last month, 36 percent more than in November. For the full year, Turkey imported 227.8 tonnes of silver, 60 percent more than in 2012. Gold Market WeaknessesThe Macquarie Gold Team noted that cost-cutting will still be the focus for the gold producers in the recent fourth-quarter preview of earnings. Macquarie also suggests that investors avoid companies that could see heightened survival risk at lower gold prices, such as Allied Nevada, Elgin Mining, and Lachlan Star. Gold Market OpportunitiesShepherd and Cooke further note that the structural issues that led to the 12-year rise in gold prices remain firmly in place. Unprecedented monetary policy in most of the world's leading economies surely must impact the intrinsic value of fiat currencies leading to debasement and inflation, unless "the laws of gravity" are to be defied. They strongly believe that gold may be close to a cycle bottom now. We believe it is significant that in September of this year China will hold its first state-supported gold conference in Beijing. The China Gold Conference and Exposition is being organized by the China Gold Association with support from the World Gold Council, the Shanghai Gold Exchange, and the Shanghai Futures Exchange. This could be a timely opportunity and a nice venue for China to make new announcements about Chinese gold reserves and/or policy. A substantial increase in China gold reserves could have a dramatic effect on the gold price. Steven Shepherd and Allan Cooke of JP Morgan see substantial value in South Africa and they expect Harmony Gold to deliver handsome rewards for investors in 2014. The rand has been hit hard in 2013, and South African gold miners have a dollar revenue stream and largely rand-based costs, so despite the weak dollar price of gold, its value denominated in rand remains at a robust level for all but the most marginal mines. South African stocks are oversold and they appear to present a significant opportunity for buyers. Gold Market ThreatsHedging of gold production has been back in the headlines, such as Barrick Gold's board saying it would be discussed. Some speculate that the motive behind the bullion banks' push to require hedging more stridently in the future is due to COMEX warehouse stocks of physical gold running at very low levels. Hence, the bullion banks, which may be short gold, need to replenish their supplies to return the leased gold to the central banks. Perhaps this is why Germany is finding it so difficult to repatriate its gold stored in the U.S. and U.K. bank vaults. Unfortunately for the miners, hedging gold at around $1,200 could mean producing at a loss. Chile's lower house members have submitted a draft bill aimed to make the use of desalinated water in mining processes mandatory, an effort to deal with the decreasing supply of water. The problem is that the cost of desalination in the country has escalated in recent years to the point that it is now twice as expensive as in the Unites States. This brought the mining industry's energy operating costs in Chile as high as 14 percent of total production costs. The mining industry, which uses significant quantities of water, is one of the main pillars of the Chilean economy, with copper exports accounting for one-third of government revenue. | |
| Posted: 04 Jan 2014 04:11 PM PST Jim Sinclair's Commentary There is an attractive opinion in the market that the drop in Chinese purchases of physical gold last month reflects a drying up of the physical market for gold at these price levels. Jim Sinclair's Commentary GEAB in their Public Announcement says it perfectly. They are right and worthy of your subscription.... Read more » The post In The News Today appeared first on Jim Sinclair's Mineset. |
Following the missed expectations of the Manufacturing PMIs in China, it appears ‘reform’ is having the exact slow-growth-inducing credit-creation-dampening effects many had worried about (but dismissed because – well the Fed has out back right?). HSBC’s China Services PMI slumped by its most in 8 months to its lowest level since August 2011 (the 2nd worst level since the data began). New business expansion in particular dropped to its lowest level in 6 months and while labor market conditions improved marginally, HSBC – desperate to cling to some silver lining – noted the Composite PMI remains above 50 (phew) – adding “we expect the steady expansion of manufacturing sectors to lend support to service sector growth…” or not. Markets are disappointed…
The last time we saw a "Great Gold Robbery" was in 1855. The equivalent of about $4 million in gold was stolen from a train moving between London and Boulogne, France. The gold was packed into three boxes and secured with iron bars. Those boxes were then placed into iron safes, loaded on the train, and then sent to France accompanied by an armed guard. When the boxes arrived in France, most of the gold had been replaced with lead shot. How did the criminals breach the various levels of security, particularly opening the safe with keys? The obvious answer is an "inside job"….
The estimated amount of taxpayer-funded payments that the federal government doled out through fraud, waste, and errors slightly decreased in 2013 to $106 billion from $108 billion the previous year, according to the White House Office of Management and Budget (OMB). 
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