Gold World News Flash |
- Gold Daily and Silver Weekly Charts – Dead on Target
- Wholesale Savings Confiscation, Enforced Redistribution & The Decline Of The European Saver
- Gerald Celente -- Bankers Unexpectedly Dying
- California's New 'Dust Bowl': "It's Gonna Be a Slow, Painful, Agonizing Death" For Farmers
- Rick Rule to gold investors: You suffered the pain, so why not hang around for the gain?
- World Gold Council on gold price corrections and 2013
- Jim Sinclair plans seminars in Los Angeles on March 8 and San Diego on March 9
- Current Economic Collapse News Brief
- Felix Zulauf Warns Of "Another Deflationary Episode" As "The Mother Of All Bubbles" Pops
- The No Debt Ceiling, Middle East Shananigans and Gold’s Clarion Call.
- In The News Today
- Economic Collapse 2014 -- Americans Have Lost Hope As The Economic Collapse Accelerates
- Precious Metals breaks out : CELENTE, HOFFMAN & MARK S. MANN
- Gold Shorts To See A Massive Squeeze As They Fail To Deliver
- TF Metals Report's charts of gold, silver, and monetary metals mining shares
- Bankers Can [Will] Steal Your Cash But Cannot Touch Your Gold/Silver
- Economic Collapse 2014 -- Economy Dead. RIOTS in Every Major City!
- Bankers Can [Will] Steal Your Cash But Cannot Touch Your Gold and Silver
- The Collapse of The American Empire
- Silver and Gold - Positioning for the Long Side
- Fiat Money - A House Built On Sand
- Beware Of The "American Spring"
- $10,000 Gold, $50,000 Gold & The Coming Frightening Chaos
- The Gold Price Soared $18.60 to Close at $1,319.00
- The Gold Price Soared $18.60 to Close at $1,319.00
- The Gold Price Is Rising. What’s Gold’s Message?
- Silver Price Breaking Out And Moving To $26
- Gold Daily and Silver Weekly Charts - Dead on Target
- Gold Daily and Silver Weekly Charts - Dead on Target
- The Essentialist’s Glossary: Updated for the ‘Teens (A-F)
- Gold's Message To The Market
- Gold's Message To The Market
- Gold best defense against ruinous inflation and deflation, von Greyerz says
- Fractional reserve bullion banking and gold bank runs: bank run theory
- Blaming the Slowdown on the Snow
- Blaming the Slowdown on the Snow
- Blaming the Slowdown on the Snow
- Questor: How to profit from gold rally
- $10,000 Gold, $50,000 Gold & The Coming Frightening Chaos
- Eric Sprott on the upward reversals in gold and silver
- An Astonishing Consensus
- An Astonishing Consensus
- Erosion of Trust Will Drive Gold Price Higher
- A Blindford, a Dart, and a Winning Gold Miner Stock
- A Blindford, a Dart, and a Winning Gold Miner Stock
- Gold Stocks Breakout
- China's offtake is forcing gold cartel to retreat, Kaye tells KWN
- Jim’s Mailbox
- Stocks Final Parabolic Bubble Spike - Great Inflation Scenerio 2014
- Silver Confirms Gold’s Breakout
| Gold Daily and Silver Weekly Charts – Dead on Target Posted: 15 Feb 2014 11:00 PM PST from Jesse's Café Américain:
So needless to say it took out its 200 Daily Moving Average with some authority. Silver popped a buck and change, and settled for 21.50ish. The Comex bullion warehouses took in 2,199 ounces of gold into the delivery bins at Brink’s, but nothing seems to be going out, so far, even to those who have taken delivery. As a reminder the US markets will all be closed on Monday for President’s Day. Please attempt to carry on without their guidance. | |
| Wholesale Savings Confiscation, Enforced Redistribution & The Decline Of The European Saver Posted: 15 Feb 2014 08:00 PM PST by Jeff Berwick, Dollar Vigilante:
The savings of 500 million Europeans is in danger of being stolen by the European Union. Why? Because the financial crisis is not over, according to an EU document. In other words, what’s happened already in Cyprus – the stealing of savers’ money – will go continental, and eventually worldwide. Only more aggressively than in the Cyprus example. The logic is likely simple: there was hardly popular resistance to the confiscation of funds in Cyprus, so why not expand the program? As we’ve stated here at Dollar Vigilante over-and-over again, governments worldwide will persist with wholesale theft from savers. How do we know? Because governments keep telling their people this. We aren’t magic-8 ball readers. We simply read the news and make the proper connections. The IMF has blatantly stated financial repression is on the table, which we reported upon, and our readers have told us of increasing capital controls worldwide. | |
| Gerald Celente -- Bankers Unexpectedly Dying Posted: 15 Feb 2014 06:36 PM PST Gerald talks about gold demand, bankers unexpectedly dying, emerging markets are melting down, hyperinflation is taking root, Fukushima is out of control. The Martial Artist of Trend Forecasting —The purpose of trend forecasting is to provide insights and directions in anticipation of... [[ 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! ]]  | |
| California's New 'Dust Bowl': "It's Gonna Be a Slow, Painful, Agonizing Death" For Farmers Posted: 15 Feb 2014 05:26 PM PST "It's really a crisis situation," exclaims one California city manager, "and it's going to get worse in time if this drought doesn't alleviate."
For the state that produces one-third of the nation's fruits and vegetables, the driest spell in 500 years has prompted President Obama to make $100 million in livestock-disaster aid available within 60 days to help the state rebound from what he describes is " going to be a very challenging situation this year... and potentially some time to come."
As NBC reports, Governor Jerry Brown believes the "unprecedented emergency" could cost $2.8 billion in job income and $11 billion in state revenues - and as one farmer noted "we can't recapture that." Dismal recollections of the 1930's Dust Bowl are often discussed as workers (and employers) are "packing their bags and leaving town..." leaving regions to "run the risk of becoming desolate ghost towns as local governments and businesses collapse."
| |
| Rick Rule to gold investors: You suffered the pain, so why not hang around for the gain? Posted: 15 Feb 2014 04:11 PM PST 7:08p ET Saturday, February 15, 2014 Dear Friend of GATA and Gold: Sprott Asset Management's Rick Rule, interviewed by King World News, asks gold investors: "You've suffered through the pain, so why not hang around for the gain?" An excerpt from the interview is posted at the King World News blog here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/2/15_Go... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Buy metals at GoldMoney and enjoy international storage GoldMoney was established in 2001 by James and Geoff Turk and is safeguarding more than $1.7 billion in metals and currencies. Buy gold, silver, platinum, and palladium from GoldMoney over the Internet and store them in vaults in Canada, Hong Kong, Singapore, Switzerland, and the United Kingdom, taking advantage of GoldMoney's low storage rates, among the most competitive in the industry. GoldMoney also offers delivery of 100-gram and 1-kilogram gold bars and 1-kilogram silver bars. To learn more, please visit: http://www.goldmoney.com/?gmrefcode=gata Join GATA here: 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 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... | |
| World Gold Council on gold price corrections and 2013 Posted: 15 Feb 2014 04:00 PM PST The Real Asset Co | |
| Jim Sinclair plans seminars in Los Angeles on March 8 and San Diego on March 9 Posted: 15 Feb 2014 03:09 PM PST 6p ET Saturday, February 15, 2014 Dear Friend of GATA and Gold: Gold advocate Jim Sinclair's next market analysis seminars will be held in Los Angeles from 11 a.m. to 2 p.m. on Saturday, March 8, and in San Diego from 2 to 6 p.m. the following day, Sunday, March 9. Details, including registration information, are posted at Sinclair's Internet site, JSMinset.com, here: http://www.jsmineset.com/qa-session-tickets/ CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT A Personal Touch in Buying Precious Metals If you've not secured your allocation of precious metals and numismatic coins, 2014 may be the last year to get them at affordable and undervalued prices. With huge amounts of gold leaving the West for Asia, the future availability of precious metals is very much in doubt. All Pro Gold has competitive pricing on all bullion and numismatic products -- and offers prompt delivery too. Long-time GATA supporters Fred Goldstein and Tim Murphy are glad to answer any questions or concerns about acquiring the monetary metals. All Pro Gold has an extensive electronic library of articles from the world's top market analysts. Learn more at www.allprogold.com or write to Fred and Tim at info@allprogold.com or telephone them at 1-855-377-4653. Join GATA here: 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 Jim Sinclair holds seminars in Los Angeles and San Diego
http://www.jsmineset.com/qa-session-tickets/ | |
| Current Economic Collapse News Brief Posted: 15 Feb 2014 02:30 PM PST In this news brief we will discuss the latest news on the economic collapse. We look to see if things are really that different. The central bank will not stop at just confiscating your wealth they will want your life. They want to enslave the people. [[ 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! ]]  | |
| Felix Zulauf Warns Of "Another Deflationary Episode" As "The Mother Of All Bubbles" Pops Posted: 15 Feb 2014 02:01 PM PST "There is a valuation problem with most global equity markets - the most with the US," warns Felix Zulauf in the following brief clip, adding that sentiment "is extremely one-sided," but the classic bear-market-inducing recession, he notes, is not on the immediate horizon. Instead, he warns, other problems may be the catalyst for a correction in the US - specifically China's "mother of all bubbles", fragility in Asian banks, and balance of payments crises continuing in emerging markets. Zulauf suggests "you have to be short stocks, own US treasury bonds, and also buy gold as panic and risks go up."
Via WSJ,
Authored by Felix Zulauf (via Brazilian Bubble blog), The U.S. has run an ever increasing deficit in her trade and current account since the early 1980s. She has thereby provided tremendous stimulus to the rest of the world by allowing other countries to export to an increasing extent. Some have accepted this opportunity with pleasure and have built a powerful export industry due to their competitive labor costs. The U.S. policy of increasing monetary and often also fiscal stimulus has allowed countries like China to build up their economies and become large and competitive economic powers. The U.S. behavior really triggered the rise of the emerging economies to a very large degree. Like an oil supertanker that turns very slowly when changing direction, the U.S. is improving to smaller deficits in her trade and current account (Chart 1). The main reasons are a domestic energy production boom (and much cheaper energy prices than in other parts of the world), cheap and more competitive labor (due to a weak U.S. dollar over the last 15 years) and the end of a leverage-driven consumption boom. Smaller deficits by the largest economy have unpleasant implications for many other nations. Of course, foreign oil producers will earn less income, but foreign exporters selling to U.S. markets are also being hurt. Simply speaking, what once was ever-increasing economic stimulus provided to the world is now turning into restraining factors for the rest of the world.
For the U.S., it means she is now losing less growth to the rest of the world and keeping more for herself, which is growth positive. That is one of the reasons why the U.S. is performing relatively better than other economies, although still well below an average recovery. While I completely disagree with the consensus about the “normalization” of the world economy and the reacceleration thesis, if one economy can achieve the forecasts, it will be the U.S. Credit Booms Are Followed by Busts As Chart 1 shows, China’s surpluses are declining and therefore trade data for many other economies are deteriorating. At the same time, many of the EM economies have gone through a tremendous boom in recent years, driven by their previous success story and large capital inflows. As I outlined in the second quarter of last year in my piece “Butterfly Effect,” we have witnessed many years of a virtuous cycle. The inflow of capital (Chart 2) revalued those currencies, and while many central banks intervened to dampen the revaluation, the liquidity thereby created fueled a domestic investment and consumption boom. It was a great success story leading to a credit and real estate boom of large proportions virtually everywhere. In the last five years, Hong Kong real estate has doubled in price, Singapore’s has increased by 70% and China’s has more than doubled. It was felt throughout the whole Asian region and also in selected EM economies in other parts of the world. Of course, they and many Western commentators interpreted this as “normal” because they all believed clocks tick differently in those economies. While some may have better demographics and less government debt, they have created private sector credit bubbles of historic proportions (Chart 3). Most importantly, they are exposed to cycles as everybody else. And that is exactly the point.
The problem with credit booms is that they always end badly, although they usually go further and last longer than rational minds expect. The weakest links are breaking first, as always. Completely mismanaged economies like Argentina and Venezuela are already in deep crisis, but that was no surprise. Next follow the deep and chronic deficit countries like Turkey or South Africa, which have already seen their currencies declining sharply. Both have little foreign exchange reserves and virtually no tools to defend the currency except for raising interest rates, which will trigger a recession. Whatever these countries do, they will end in a recession because that is the way balance-of-payment crises are resolved. It is Ying and Yang, action and reaction; booms will be followed by busts, particularly when built on quicksand of phony money and credit creation. These are of course also the unintended consequences of many years of quantitative easing (QE) in the major economies spilling over to emerging economies. Now, markets have become aware of the problem and are attacking the imbalances. Research on private sector credit booms over the last 20 years show that whenever credit to the private sector expanded by 30% or more within a 10-year period, a banking crisis and recession resulted without any exception. The following countries are all far above that danger level today and candidates for a banking crisis: Hong Kong, China, Thailand, Brazil, Turkey and Singapore. And recently even Korea, Romania, Ukraine and even Russia have broken the danger level. This is quite a long list, and the big EM economies are all part of it except India that has other deficiencies. Now, these economies differ from each other, of course, but they share a common disease, namely a previous economic boom built on excessive credit. Most have chronic deficits in their external accounts that were unimportant as long as foreign capital flowed in at large. The response to current problems – which have been with us since the tapering was announced last summer – also differs as some simply cannot intervene in the currency market due to the lack of enough foreign exchange reserves (Turkey, South Africa) while others do intervene due to large reserves, like Brazil or Russia. Some are struggling due to the compounding effect of political trouble (Turkey) and some like Russia due to spending their foreign exchange reserves on weak political allies, in this case the Ukraine. All of them will end up with higher interest rates, a weaker economy and a weaker currency, eventually. The Mother of All Bubbles While some may understand the mechanism of a balance of payment that is seriously out of line and its ultimate adjustment process, most investors don’t. That’s why most voices one hears do not, in our view, address the problem properly and think it is an isolated case. While some may understand a case like Turkey, most disagree when it comes to China. While I am as impressed as others by China’s economic performance over the last 2-3 decades, we shouldn’t overlook the fact that, particularly since 2008, the economy enjoyed the most dramatic credit boom ever seen in modern history. China became the second largest economy in a very short period. In the last five years, China’s total credit outstanding more than doubled and grew more than the equivalent of the total U.S. commercial banking sector, namely the equivalent of $14 trillion. That is equivalent to 150% of their current GDP. Moreover, the balance sheet of the Chinese central bank showed the biggest balance sheet expansion since 2000 of all central banks, which is testimony of an ultra-easy monetary policy. Credit growth in the years leading to the bursting of previous bubbles has been 40%-50%, as was the case in the U.S. from 2002-2007, in South Korea in the mid-90s and in Japan in the late 80s. China’s credit growth has been by far higher than all of those. Now, we see all the signs one usually sees before the bubble bursts. For instance: – Large expansion and acceleration of credit not matched by GDP, as credit growth is still 2.5 times faster than GDP but slowing. – An aggressive expansion of a shadow banking system (wealth management products WMP) that has similarities to the U.S. subprime loans. – Massive investments in property leading to a bubble in many locations. Tier 3 and 4 cities already see real estate prices declining, while prices are still rising in tier 1 and 2 cities. – Weak risk management at financial institutions similar to U.S. and European banks before the Great Financial Crisis. There are recurring stories of banks in trouble in China and the government throwing money at them. Recently, some shadow banking institutions went bust and investors lost money. – Finally, a heavily state-directed financial and corporate sector, which in China is a given, primarily in banking. In the U.S. it was Freddy Mac and Fanny Mae. – Rising interest rates driven by competitive bidding for funding, not by central bank tightening. We saw this first in spring 2013, then in December of last year and now again. China is facing the ugly choice of either deflating the bubble, hopefully in a controlled way, or of re-inflating even more, leading to an even bigger debt crisis further down the road. Continuing on the current path and procrastinating would mean even more waste investment than has already occurred and would be rather stupid. Hence, I think the chances are better than 50:50 that China will try to deflate in a controlled way, although it would be a hesitant approach at the beginning. Whether it would remain controlled is another question as it would lead to bankruptcies, an economic crisis of some sort and big problems in the financial, real estate and construction sectors. It is clear that such an outcome in the second largest economy of the world wouldn’t remain a domestic affair but impact the rest of the world. At particular risk are those financial institutions exposed with large loan portfolios to China, including WMPs. Hong Kong is at extreme risk, with bank loans amounting to almost 150% of GDP. The U.S. will certainly be impacted the least, as I have outlined above. If the Chinese try to procrastinate by throwing more liquidity at the problem, capital would flow out and weaken the yuan despite capital controls. If China tried to support her currency, she would face a situation similar to Russia today. Supporting your own currency by intervention drains liquidity from your domestic credit system, and that’s why Russia is facing a banking crisis at present. Hence, if China chose this route, her currency would weaken and compound the structural problems due to capital outflow weakening the banking system’s deposit base. A weaker yuan could trigger the next problem as it would hurt Asian competitors in particular. Japan’s weakening of the yen was an important trigger to weaken many other Asian competitors, recently. If China would follow suit, it would simply be another deflationary hit for many others, probably the world as a whole. While the timing of this described process is open as is the way the Chinese will choose, we must expect it to begin at any time and last many quarters if not years. The message is that problems in emerging economies are not over, and weakness in currencies, bonds and equities are in general not an opportunity to buy, yet. What investors should be aware of is that the problems in Turkey, South Africa or Russia are only sideshows compared with what’s out there in China and its implications for the world, which in our view are still not understood and not priced in by markets. As we don’t live in an isolated world, there will be knock-on effects. Emerging markets ex China account for virtually 1/3 of total global imports, similar to the European Union, while the U.S. accounts for approximately 15% and China for only 10%. Arthur Budaghyan of BCA, Montreal, who does excellent work on emerging markets, recently published Chart 4, showing the high correlation and leading function of emerging equity markets’ relative performance to global industrial production. Moreover, Chart 5 illustrates so clearly how weakening currencies in emerging economies will eventually lead to sharp declines of imports. Those imports are of course someone else’s exports.
The mechanism, in simple terms, has been QE in the developed world leading to capital flows into emerging markets, triggering an investment and consumption boom built on cheap credit. The boom led to rising wages, reduced competitiveness, less household income after inflation, taxes and rent (which rose sharply due to the real estate boom). Now, domestic and external demand is weakening while inflation is high and external accounts are imbalanced. Hence, the world will see the next chapter of the unintended consequences of QE, namely many economies going through a balance-of-payment crisis leading to recessions and banking crises and hurting global economic growth. The U.S. will be hurt too, but is the least exposed. Fragile Euro Zone The big winner in equity markets in recent quarters has been the euro zone, the periphery in particular. Those yield-hungry investors who previously bought emerging market bonds have switched to buying peripherals driving the yield down to almost half the level of what prevailed in 2012, when many feared an immediate euro breakup. U.S. and Japanese investors were at the margin quite active due to the strengthening euro and the “normalization” of yields. The thesis has been sharply reduced risks due to stabilization and expected recovery. Indeed, some like Spain have made some progress but the fundamental problems of the monetary union have not been resolved. Part of the stabilization is due to less austerity leading to growing public sector deficits again. At present, nobody cares about it and believes the situation will heal over time. It won’t, in my view. Problems have a habit to stay and grow bigger and not right themselves without proper tackling. It is true, some indicators have improved, but most of them are sentiment-based, like PMIs. As long as short-term improvements are not supported by monetary aggregates – and they are definitely not, with total credit shrinking by more than 4% year over year in the euro zone – upticks are simply coincidental and no indication of a new trend. There is no change on the horizon, as the banking industry continues to shrink its balance sheet in view of the upcoming stress test. The ECB has recently decided not to sterilize its bond purchases any longer, which is a slight easing move. It was supported only by the Bundesbank to prevent other more aggressive steps, of course. While some may think this step will lead to a better European economy, I rather see it as too little, too late to make a change. Risk aversion will rise again, once investors find out the world has entered another deflationary episode, with many balance-of-payment crises that are only now beginning. Yes, it may look far away in the emerging world, but it will have knock-on effects and slow down the global economy much more than expected and hurt particularly multinationals’ revenues and profits. Nowadays, the emerging world is half of the world economy, and the world economy is more intertwined than ever before. Changing Market Character “As January goes, so goes the year” has an accuracy of 73% for the U.S. equity market, according to the Trader’s Almanac. I don’t rely on such statistics, but what is clearly visible is the changing character of the market. This correction so far is already the most vicious in many months. Importantly, sharp short-term sell-offs could not attract new buying, as was the case all of last year, but triggered renewed selling. Some important momentum and trend indicators are breaking down (Chart 6), and divergences built up over many months are now forcing the indices down. In Chart 7, we also witness fewer and fewer markets with rising 200-day moving averages (71%) and less and less trading above that moving average (59%). A break below 60% in the first in combination with a break below 50% in the second usually confirms a global bear market underway.
The well-performing markets in Europe and the U.S. didn’t see any new negative news, but they were so overheated and overbought that markets were selling off without. Markets had entered a highly speculative stage, with sentiment indicators hitting multi-year extremes. U.S. margin debt as a percentage of GDP has now hit 2.6%, the same extreme as in 2007 at the peak and close to the all-time high of 2.8% in 2000. In discussions with European investors in recent months, it was unbelievable how bullish they have become. Picking the right stock was all they cared about, since in their view it was a given that stock prices could only rise as long as central banks pursued easy money and low interest rate policies. Any word of caution was moved to the side. I spoke at a conference recently, before this sell-off really began, and was looked at like somebody from another planet, as all others were so indiscriminately bullish. They didn’t even care about asset allocation. Equities were simply the only game in town – no bonds, no cash, no gold, no real estate, just equities. Frothy markets by themselves may not make a top, but they indicate high vulnerability for corrections. The most important fundamental change at the margin is the “tapering” by the Fed. There have been intense internal discussions at the Fed, and the way I am reading the tea leaves, the Fed is tired of money printing and wants out. Hence, I am expecting their tapering to continue and to be complete later this year, provided no major accident happens in the financial markets in between. This is equivalent to raising interest rates from minus two percent to zero. And while zero is still low, it is in my view a step by step removal of stimulus and therefore a regime shift in monetary policy at the most important central bank of the world. This is a strong message. Unfortunately, we have no experience with “tapering” and therefore do not know when and how it impacts markets. However, such a change in combination with frothy markets has now triggered a serious correction that in our view has more to run. Since developments in the developed world will not lead to an immediate economic downturn, opportunity hunters will appear and buy the dip, perhaps several times. Hence, it could be a step by step correction during this quarter followed by another upside attempt, particularly in the U.S. and Europe. In our reading, the current weakness is led by | |
| The No Debt Ceiling, Middle East Shananigans and Gold’s Clarion Call. Posted: 15 Feb 2014 12:43 PM PST Dear CIGAs, Did you scratch your head just a little bit at how easy John Boehner rolled over and the debt ceiling got lifted by Congress? "Clarity" it was said, and the "uncertainty" of a debt limit was lifted so all should be OK for another year. No sequester, no cutting back, no nothing. That’s... Read more » The post The No Debt Ceiling, Middle East Shananigans and Gold’s Clarion Call. appeared first on Jim Sinclair's Mineset. | |
| Posted: 15 Feb 2014 12:40 PM PST Jim Sinclair’s Commentary The Great Gold Battle will be fought here. Jim Sinclair’s Commentary One day back from being wined and dined at the White House and Hollande says, thank you. Looks like we are headed back to "Freedom Fries." Merkel and Hollande to discuss European communication network avoiding U.S. BERLIN (Reuters) – German... Read more » The post In The News Today appeared first on Jim Sinclair's Mineset. | |
| Economic Collapse 2014 -- Americans Have Lost Hope As The Economic Collapse Accelerates Posted: 15 Feb 2014 11:30 AM PST Cyprus has now back tracked on the capital controls, they now have pushed the removal of capital controls to 2 weeks to 1 year. Europe's economy is not growing and is the worst since 2009. Industrial production crashed and the FED is blaming it on the weather. Foreclosures are up and financial... [[ 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! ]]  | |
| Precious Metals breaks out : CELENTE, HOFFMAN & MARK S. MANN Posted: 15 Feb 2014 10:30 AM PST Precious Metals & World Affairs UPDATE: CELENTE, HOFFMAN & MARK S. MANN Gold breaks out, Silver vaults over $21, Physical Gold demand is at least twice global annual production according to Eric Sprott, Bankers are unexpectedly dying, Emerging markets are melting down and... [[ 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! ]]  | |
| Gold Shorts To See A Massive Squeeze As They Fail To Deliver Posted: 15 Feb 2014 09:49 AM PST  Today one of the wealthiest people in the financial world told King World News "that the documented large (gold) short positions that exist in the paper market may get their long awaited religious experience." This is an incredibly important interview with Rick Rule, who is business partners with billionaire Eric Sprott, where he discusses what the implications are for investors and also what to expect in the future."This posting includes an audio/video/photo media file: Download Now | |
| TF Metals Report's charts of gold, silver, and monetary metals mining shares Posted: 15 Feb 2014 07:43 AM PST 10:40a ET Saturday, February 15, 2014 Dear Friend of GATA and Gold: If you think that technical analysis still might mean something in markets as heavily manipulated by central banks and their agents as gold and silver are, or that TA might start meaning more if that manipulation starts to ease off or to fail, you might want to check out the TF Metals Report's new series of price charts for gold, silver, and the monetary metals mining shares. The commentary is headlined "$1,320 by Valentine's Day" and it's posted here: http://www.tfmetalsreport.com/blog/5490/1320-valentines-day CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT A Personal Touch in Buying Precious Metals If you've not secured your allocation of precious metals and numismatic coins, 2014 may be the last year to get them at affordable and undervalued prices. With huge amounts of gold leaving the West for Asia, the future availability of precious metals is very much in doubt. All Pro Gold has competitive pricing on all bullion and numismatic products -- and offers prompt delivery too. Long-time GATA supporters Fred Goldstein and Tim Murphy are glad to answer any questions or concerns about acquiring the monetary metals. All Pro Gold has an extensive electronic library of articles from the world's top market analysts. Learn more at www.allprogold.com or write to Fred and Tim at info@allprogold.com or telephone them at 1-855-377-4653. Join GATA here: 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: | |
| Bankers Can [Will] Steal Your Cash But Cannot Touch Your Gold/Silver Posted: 15 Feb 2014 06:32 AM PST Bankers can and will steal your cash, but there is no way they can take your personally owned and personally held gold and silver. The ongoing plan for 2014 is to buy and hold even more gold and silver and reduce your exposure to cash held in any bank. Just keep enough to cover week by week expenses, and keep the rest of your cash at home, under the mattress, in a safe, buried in the backyard, anywhere but in a bank. ANYONE who keeps money in any banking system in the Western world is sending an RSVP to bankers to access your funds, and they will not disappoint. The confiscation of Cyprus banking accounts was bandied about as a template for other countries. "No, that would never happen," was a constant refrain. Well, it was just the beginning. If there is one thing about which you can be certain, concerning cash held on deposit, the government, [pick a country], has plans to steal it. The bankers new motto: "What's yours is ours." You think Cyprus was a single event? It was an elite trial balloon. The blowback from it? Not much, really. Financial shock and awe, to be sure, especially for Cypriots, but just like every other banker-created scam, there are no real consequences. The elites carefully monitored world response and learned one thing: more of the same, in some fashion or similar form will work, and we [the bankers] will get away with it. Another example: Read this excerpt from the IMF October publication "Taxing Times" which states on page 49: A One Off Capital Levy:
The cunning and planning goes on behind closed doors on an ongoing basis. Then there was this article from Reuters: EU Executive See Personal Savings Used To Plug Gap. "the savings of the European Union's 500 million citizens could be used to fund long-term investments to boost the economy and help plug the gap left by banks since the financial crisis, an EU document says. In other words, all of the trillions of $$$ used to prop up every single insolvent bank in the Western world has failed to boost any economy, and the reason why it has failed is because the bankers are keeping the money for themselves, not lending it out. Every economy is being starved of capital. The solution? "The Commission will ask the bloc's insurance watchdog in the second half of this year for advice on a possible draft law "to mobilize more personal pension savings for long-term financing", the document said." Doesn't that sound economically viable?! It is EU doublespeak: to mobilize more personal savings, in normal words means "confiscate," or more to the point, "steal." The central planners never stop planning, and your savings and deposits are in their crosshairs. The bankers are not stopping there, however. The ultimate goal? All pensions, IRAs, 401ks, whatever form your retirement funds are in will be switched, for your own good, of course, to the safety and guaranteed security of government bonds. You will be assured of a few percentage points of interest. What, 1, 2, 3 percent? With inflation running at 8 to 10 percent, minimum, at least in the real world? Such a deal. Obama has introduced the MyRA account, and just like Obamacare, it is for the "benefit" of the public good. It is the prelude for eventually taking over the country's entire pension programs, taking over all the accounts, [stealing your lifetime savings], and exchanging them for the US Treasury Bonds the Fed cannot sell to countries anymore. This is the only way the US government can cover its trillion $ [and growing] deficit spending. What is wrong with this picture? Who elected the bankers? Who elected the EU members that run Europe like their own ATM? They all are empowered by the elite shadow rulers. What is worse, people are not rebelling. Instead, all acquiesce to the whims of the central bankers. "All" is close but not quite accurate. There are the relatively few who own and hold silver and gold, immune, to that extent, from the theft of banking funds/pension funds/ mutual funds/corporate and government bonds, any form of paper thought to have value. Rest assured that those who impose [steal] "special situations" are exempt themselves. All of your hard-earned money and life savings are needed to prop up the insolvent banks, pay for all the banker bonuses and lavish lifestyles, because the bankers will never be held accountable to the financial problems they created, and you must now pay for their mistakes for no bankers are ever held accountable, just you and your neighbors. We are all free to make choices. From what we can determine, financially smart people own and personally hold, and continue to buy gold and silver, the most durable "wealth" preserver of all. The word "wealth" is used for lack of a better choice in the asset class of precious metals. There has been no wealth preservation owning gold and silver for the past few years, stated and acknowledged. However, that is a very short time frame from which to measure. The choice is simple: paper or hard assets? Owning gold or silver ETFs or futures are paper and not a claim on the physical. Accept no substitutes. For those who choose to remain within the banking system, the risks are known, and if accepted for what the central bankers are planning, made public by the way, there can be no complaining when funds are lost. The charts remain the most viable way of keeping a pulse on the price of gold and the gold price. Some make a distinction, but the effect has been of no consequence from a pragmatic point of view. Our weekly charts and assessment follow: As a reminder, the charts are in contradistinction to physical gold and silver. Everyone should be buying physical gold and silver as often as possible, and price is not the most important issue, owning it is. The charts reference the paper form of gold and silver, but they relate to the price of the physical, by extension, as a general guide. The past two weeks have been the best for gold in several months. We maintain the belief that extraordinarily higher prices for gold and silver are not going to happen, in the near term. Maybe sometime in 2014, it is too soon to tell. What is more important are the events like those discussed above that are setting the stage for eventual higher prices. What should be of primary concern for buyers of the physical is the availability. It may not always be readily available, as it is now, and that should be a driving motivation for their acquisition. For those who already own PMs, particularly at higher prices, do not fret. Their value will go back to levels paid, and much higher. Just be patient. It is short- sighted to measure one's holdings based on price as opposed to the reason for buying them in the first place. If you do not complain about paying for car or house insurance that does not get used, why complain about PM holdings from higher prices? Stay focused. Events are unfolding in an alarming manner, and people should be very worried about what is going to happen. Look at Cyprus, Greece, Venezuela, Ukraine to get an idea of how ugly things can, and will get. The weekly chart shows the current down trend weakening but not ending. As is pointed out in the weekly silver chart, one only need look at the rally that began in June, 2013. If anyone thought the breaking of a TL [Trend Line] meant the end of a bear market, look again. It takes time for a trend to change, and with the exception of a "V-Bottom," there are a few phases that mark trend changes. The Bearish Spacing still stands out for what could be formidable resistance, yet to be determined. As a reminder, bearish spacing exists when the last swing high, August 2013, fails to reach the lows of the last swing low, May 2012. It indicates sellers did not feel the need to see how the swing low would be retested. They aggressively embarked upon their selling campaign certain that lower prices were next. The August swing high will be defended by those who sold at that level, which will make it resistance. There is a relatively smaller resistance level, marked on the chart, at 1360.4, a smaller swing high. How the market responds to the known resistance levels will give an indication of the character of the existing trend.
The daily trend is up, as defined by a two higher highs with a higher low in between. Once price rallied above 1280, it formed a higher high and confirmed a change in trend on the daily. Once that was confirmed, it was then easier to put the previous market activity into a context that supported the change in trend. Sometimes, recognizing changes can only be determined in hindsight. The two wide range bars, with arrows under each, anchored the rally in gold. There was no way to know beforehand that gold would make higher daily lows for 10 days straight, and that left no [normal] reaction in which to buy. This is a decided change in market behavior, and if sustained, will continue building on the up trend just under way. The primary resistance at 1360 is the same on the daily and weekly, giving greater weight to the daily chart. A lesser, potential resistance level is also shown by the dashed line from a failed retest rally, marked on the chart. Money is not made buying potential resistance, which the 1280 area represented, and for that reason, we were not buyers and missed the last half of the rally. We did catch some of the earlier portion of it, however. What we know for certain is that every market will have a normal correction, and it is at that point one can take a position with a more clearly defined risk. For now, we remain on the sidelines in the paper futures.
Pointing out the importance of not jumping to any conclusion that last week's strong rally has change the trend, a look back at the first arrow shows an earlier strong rally that did not change the trend. Everything needs to be confirmed, and the rally from the first arrow was never confirmed as a change in trend. Patience is a virtue in the markets.
Friday's rally in silver was impressive, coming out of the protracted TR, [Trading Range]. When you measure from point "A" to point "B," that "stored energy" accumulated during the trading range reveals that the upside rally potential can carry silver to the 25 area, and even challenge the all important 26 resistance. Silver also has bearish spacing, shown on the weekly chart, but it is not as great as the gold bearish spacing. There is a good possibility that silver can outperform gold, on the next important rally. The "D/S" designated Demand overcoming Supply, and the sharp volume increase is very supportive of the rally. A great place to get long is on the retest of the breakout, and we will be watching how the next retest unfolds.
| |
| Economic Collapse 2014 -- Economy Dead. RIOTS in Every Major City! Posted: 15 Feb 2014 05:15 AM PST The hope is that by stimulating more borrowing and spending, lower interest rates can jumpstart the economy. The Fed will have to keep rates near zero "well past the time" that unemployment crosses below the 6.5 percent threshold [[ 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! ]]  | |
| Bankers Can [Will] Steal Your Cash But Cannot Touch Your Gold and Silver Posted: 15 Feb 2014 03:23 AM PST Bankers can and will steal your cash, but there is no way they can take your personally owned and personally held gold and silver. The ongoing plan for 2014 is to buy and hold even more gold and silver and reduce your exposure to cash held in any bank. Just keep enough to cover week by week expenses, and keep the rest of your cash at home, under the mattress, in a safe, buried in the backyard, anywhere but in a bank. ANYONE who keeps money in any banking system in the Western world is sending an RSVP to bankers to access your funds, and they will not disappoint. The confiscation of Cyprus banking accounts was bandied about as a template for other countries. "No, that would never happen," was a constant refrain. Well, it was just the beginning. | |
| The Collapse of The American Empire Posted: 15 Feb 2014 02:30 AM PST Alex continues with calls from listeners on the topics of false flags, Iran's recent threats of attacks on the US and the risks of impending Global War. People are at wits-end. If we don't see justice soon I'm afraid someone might jump the gun. To anyone that reads this: I plead to you:... [[ 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! ]]  | |
| Silver and Gold - Positioning for the Long Side Posted: 15 Feb 2014 12:53 AM PST Jeffrey Lewis | |
| Fiat Money - A House Built On Sand Posted: 14 Feb 2014 07:21 PM PST Warning, I'm not a licensed financial planner, a broker, an analyst, a geologist nor an economist. And I'm also not, as you so often tell me in your e-mails regarding my articles, an English professor. I'm also not a doom and gloomer nor am I a gold bug. I'm just an investor who believes precious metals are the only financial safety net worth owning and need to be the cornerstone of any generational wealth building program. Everyone should own gold and silver bullion in the form of coins and bars. | |
| Beware Of The "American Spring" Posted: 14 Feb 2014 06:30 PM PST There are only individual solutions to collectivist problems. The Powerful Elite love the fact Obama don't mind screwing things up. Keeps us focused on him rather the bigger picture like the debt everyone in the US owes to pay off this 17+ trillion dollar debt. At some point hyper inflation... [[ 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! ]]  | |
| $10,000 Gold, $50,000 Gold & The Coming Frightening Chaos Posted: 14 Feb 2014 05:07 PM PST Dear CIGAs, On the heels of another wild trading week, today a 42-year market veteran spoke with King World News about the coming frightening chaos that investors around the world need to be brace for, as well as $10,000 gold, $50,000 gold and much more. Below is the powerful interview with Egon von Greyerz, who... Read more » The post $10,000 Gold, $50,000 Gold & The Coming Frightening Chaos appeared first on Jim Sinclair's Mineset. | |
| The Gold Price Soared $18.60 to Close at $1,319.00 Posted: 14 Feb 2014 03:18 PM PST Gold Price Close Today : 1,319.00 Gold Price Close 7-Feb-14 : 1,263.30 Change : 55.70 or 4.4% Silver Price Close Today : 21.411 Silver Price Close 7-Feb-14 : 19.92 Change : 1.491 or 7.5% Gold Silver Ratio Today : 61.604 Gold Silver Ratio 7-Feb-14 : 63.419 Change : -1.815 or -2.9% Silver Gold Ratio : 0.01623 Silver Gold Ratio 7-Feb-14 : 0.01577 Change : 0.00046 or 2.9% Dow in Gold Dollars : $ 253.18 Dow in Gold Dollars 7-Feb-14 : $ 258.44 Change : -5.27 or -2.0% Dow in Gold Ounces : 12.247 Dow in Gold Ounces 7-Feb-14 : 12.502 Change : -0.25 or -2.0% Dow in Silver Ounces : 754.49 Dow in Silver Ounces 7-Feb-14 : 792.88 Change : -38.39 or -4.8% Dow Industrial : 16,154.39 Dow Industrial 7-Feb-14 : 15,794.08 Change : 360.31 or 2.3% S&P 500 : 1,838.63 S&P 500 7-Feb-14 : 1,797.02 Change : 41.61 or 2.3% US Dollar Index : 80.180 US Dollar Index 7-Feb-14 : 80.740 Change : -0.56 or -0.7% Platinum Price Close Today : 1,428.50 Platinum Price Close 7-Feb-14 : 1,377.60 Change : 50.90 or 3.7% Palladium Price Close Today : 737.40 Palladium Price Close 7-Feb-14 : 708.60 Change : 28.80 or 4.1% This week was the week and today was the day for silver and GOLD PRICES. Gold broke through $1,300 yesterday and the shorts went skittering today as gold soared $18.6 (1.43%) to close at $1,319.00. Silver shocked even me, vaulting 102.6 cents (5.03%, yes!) to close Comex at 2141.1c. Where to start? First, parallel markets. Platinum and palladium have been trending up for nearly two weeks. Platinum closed on its 200 DMA today while palladium stands way above all moving averages, i.e., momentum is skyward. Gold/Bank Stock Index spread, which rises when faith in the financial system is falling and vice versa, is rising. XAU, GDX, and HUI precious metals mining stock indices have all broken out upward and crossed above their 200 DMAs this week. The GOLD PRICE very nearly broke upward through its since-August-2013 downtrend line this week, the chart shows a double bottom, other indicators are floating upward, and it has broken through its 20 week moving average. The gold price hath climbed straight up from an upside-down head and shoulders up through the neckline, broken through old resistance from $1,290 - $1,300, and today closed above its 200 DMA for the first time since February a year ago. Only problem with this picture is that it can leave us so giddy that we overlook that stochastic indicator that is flashing a warning. I don't think this rally has ended, but around $1,350 - $1,360 it will likely begin losing altitude. This rally has run since 31 December 2013. If gold sent the gold shorts skittering, the SILVER PRICE drove all the silver-shorts clean back into the woodwork and down in the basement. Yesterday I said I'd be surprised if silver didn't close above 2050c today, but I was not prepared for today's explosion. Silver was pressed and packed against that April downtrend line and the tope of the range at 2050c, and when it burst through it couldn't stop until it punched clean through its 200 DMA and almost 2150c. That implies that before this rally ends silver will reach 2300c, maybe higher. Silver's weekly close today took it above the since-April 2011 downtrend line on the weekly chart. Once more, be wary! Next week or two will likely be VERY heady in silver, but markets move up in waves, back and forth, pendulum-like. And once more, the possibility exists but daily grows dimmer, that silver and gold might yet make one leg down to lower lows. I don't believe that will happen, but the possibility remains. Meanwhile, I am buying. Since anything I say about my competition is bound to sound invidious, I seldom say anything. However, I warn y'all that not everybody can be trusted. Many, many times in my almost 34 years in this business I have seen the big "players" and "cheap sellers" evaporate overnight. The gold and silver industry works on very, very small margins, 3.5% to 1% commission, so there's a problem with "cheap prices": very little room to discount. Years ago Krugerrand Corporation in Florida (that location and California are a potential tip-off) figured out they could sell Krugerrands at a very cheap price if it didn't bother with actually buying them when it sold them to customers. Same business model as Bernie Madoff and Carlo Ponzi. Just today a customer called and told us about a friend who had sent a large sum to a "cheap-selling" California dealer but now cannot get delivery. Before you do business with ANY gold or silver dealer, take a few moments to check them out with the unbiased Better Business Bureau. Frankly, I have no ambitions to rank as "Cheapest Seller in the US" or "The WalMart of Silver and Gold." I know what it costs us to stay in business, and I know what sort of tailored, profitable, and professional guidance we give every customer, large and small. I figure "the workman is worthy of his hire," but if you don't, then go to the cheapest seller on the Internet and enter your order without ever talking to a human or getting any professional advice. And I hope you get delivery. Before I forget it, let me remind y'all that if you ever expect to swap gold for silver at spot ratios above 60:1, you had better do it quickly. I recommend swapping gold for silver now, targeting a swap back at 31:1 or better. WOW. What a week, and much of it happened today in metals! Stocks recovered this week, running toward their soon and ultimate top. US dollar index wilted. White metals also zoomed up. US Dollar Index melted, falling through the uptrend line that had caught it since last November. Since mid-September it has range-traded from 81.60 to 79.75, and now is drawing close to that lower boundary. It also is nearing the downtrend line from September, same line it broke through upward as December closed. A fall through that line, which stands about at the bottom of the trading range, about 80, would foretell much pain. Today the dollar index lost 18 more basis points (0.22%) to end at 80.18. Big gainer from the Dollar index's fall was the euro, which rose 0.15% to $1.3698, beating its head on the old uptrend line it fell through in January. I have it on my list to buy euros right after I have all my teeth pulled by an orangutan wielding wire pliers. I like to pile one killer pain atop another. Yen hardly budged today, up 0.385 to 98.22 cents/Y100. Momentum is up, NGM's determination is down -- which do y'all think will win? I note in passing that the 10 year US treasury note yield rose 0.37% today to 2.746%. It's skating above its 20 DMA, above its 200 dma, trading sideways. Better watch it. The Federal Reserve's house of cards begins trembling when it breaks above 3.1%. STOCKS spent the last week recovering from their gigantic January fall. Dow gained 126.8 (0.79%) to 16,154.39, S&P500 clumb 8.8 (0.48%) to 1,838.63. Mercy, y'all, this is a doomed effort. It can end sooner, or it can end later, but end it will by end-May. Oh, the weeping, wailing, and gnashing of profits! Please, protect yourselves. Whooo! That Dow in Silver put some HEAVY sinkers on its line today and sank, sank, sank. Ended down 4.04% (31.72 oz) at 754.14 oz, breathing hard down the neck of the 200 DMA at 738.95 oz. Crossing below that will turn momentum unarguably down. Dow in gold lost 0.62% to close at 12.25 oz (G$253.23 gold dollars). All indicators speak with one witness: DOWN. Y'all enjoy your weekend! Argentum et aurum comparenda sunt -- -- Gold and silver must be bought. - Franklin Sanders, The Moneychanger The-MoneyChanger.com © 2014, The Moneychanger. May not be republished in any form, including electronically, without our express permission. To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $3,130.00; silver's primary is up targeting 16:1 gold/silver ratio or $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold or 18 ounces of silver. or 18 ounces of silver. US $ and US$-denominated assets, primary trend down; real estate bubble has burst, primary trend down. WARNING AND DISCLAIMER. Be advised and warned: Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures. NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps. NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced. NOR do I recommend buying gold and silver on margin or with debt. What DO I recommend? Physical gold and silver coins and bars in your own hands. One final warning: NEVER insert a 747 Jumbo Jet up your nose. | |
| The Gold Price Soared $18.60 to Close at $1,319.00 Posted: 14 Feb 2014 03:18 PM PST Gold Price Close Today : 1,319.00 Gold Price Close 7-Feb-14 : 1,263.30 Change : 55.70 or 4.4% Silver Price Close Today : 21.411 Silver Price Close 7-Feb-14 : 19.92 Change : 1.491 or 7.5% Gold Silver Ratio Today : 61.604 Gold Silver Ratio 7-Feb-14 : 63.419 Change : -1.815 or -2.9% Silver Gold Ratio : 0.01623 Silver Gold Ratio 7-Feb-14 : 0.01577 Change : 0.00046 or 2.9% Dow in Gold Dollars : $ 253.18 Dow in Gold Dollars 7-Feb-14 : $ 258.44 Change : -5.27 or -2.0% Dow in Gold Ounces : 12.247 Dow in Gold Ounces 7-Feb-14 : 12.502 Change : -0.25 or -2.0% Dow in Silver Ounces : 754.49 Dow in Silver Ounces 7-Feb-14 : 792.88 Change : -38.39 or -4.8% Dow Industrial : 16,154.39 Dow Industrial 7-Feb-14 : 15,794.08 Change : 360.31 or 2.3% S&P 500 : 1,838.63 S&P 500 7-Feb-14 : 1,797.02 Change : 41.61 or 2.3% US Dollar Index : 80.180 US Dollar Index 7-Feb-14 : 80.740 Change : -0.56 or -0.7% Platinum Price Close Today : 1,428.50 Platinum Price Close 7-Feb-14 : 1,377.60 Change : 50.90 or 3.7% Palladium Price Close Today : 737.40 Palladium Price Close 7-Feb-14 : 708.60 Change : 28.80 or 4.1% This week was the week and today was the day for silver and GOLD PRICES. Gold broke through $1,300 yesterday and the shorts went skittering today as gold soared $18.6 (1.43%) to close at $1,319.00. Silver shocked even me, vaulting 102.6 cents (5.03%, yes!) to close Comex at 2141.1c. Where to start? First, parallel markets. Platinum and palladium have been trending up for nearly two weeks. Platinum closed on its 200 DMA today while palladium stands way above all moving averages, i.e., momentum is skyward. Gold/Bank Stock Index spread, which rises when faith in the financial system is falling and vice versa, is rising. XAU, GDX, and HUI precious metals mining stock indices have all broken out upward and crossed above their 200 DMAs this week. The GOLD PRICE very nearly broke upward through its since-August-2013 downtrend line this week, the chart shows a double bottom, other indicators are floating upward, and it has broken through its 20 week moving average. The gold price hath climbed straight up from an upside-down head and shoulders up through the neckline, broken through old resistance from $1,290 - $1,300, and today closed above its 200 DMA for the first time since February a year ago. Only problem with this picture is that it can leave us so giddy that we overlook that stochastic indicator that is flashing a warning. I don't think this rally has ended, but around $1,350 - $1,360 it will likely begin losing altitude. This rally has run since 31 December 2013. If gold sent the gold shorts skittering, the SILVER PRICE drove all the silver-shorts clean back into the woodwork and down in the basement. Yesterday I said I'd be surprised if silver didn't close above 2050c today, but I was not prepared for today's explosion. Silver was pressed and packed against that April downtrend line and the tope of the range at 2050c, and when it burst through it couldn't stop until it punched clean through its 200 DMA and almost 2150c. That implies that before this rally ends silver will reach 2300c, maybe higher. Silver's weekly close today took it above the since-April 2011 downtrend line on the weekly chart. Once more, be wary! Next week or two will likely be VERY heady in silver, but markets move up in waves, back and forth, pendulum-like. And once more, the possibility exists but daily grows dimmer, that silver and gold might yet make one leg down to lower lows. I don't believe that will happen, but the possibility remains. Meanwhile, I am buying. Since anything I say about my competition is bound to sound invidious, I seldom say anything. However, I warn y'all that not everybody can be trusted. Many, many times in my almost 34 years in this business I have seen the big "players" and "cheap sellers" evaporate overnight. The gold and silver industry works on very, very small margins, 3.5% to 1% commission, so there's a problem with "cheap prices": very little room to discount. Years ago Krugerrand Corporation in Florida (that location and California are a potential tip-off) figured out they could sell Krugerrands at a very cheap price if it didn't bother with actually buying them when it sold them to customers. Same business model as Bernie Madoff and Carlo Ponzi. Just today a customer called and told us about a friend who had sent a large sum to a "cheap-selling" California dealer but now cannot get delivery. Before you do business with ANY gold or silver dealer, take a few moments to check them out with the unbiased Better Business Bureau. Frankly, I have no ambitions to rank as "Cheapest Seller in the US" or "The WalMart of Silver and Gold." I know what it costs us to stay in business, and I know what sort of tailored, profitable, and professional guidance we give every customer, large and small. I figure "the workman is worthy of his hire," but if you don't, then go to the cheapest seller on the Internet and enter your order without ever talking to a human or getting any professional advice. And I hope you get delivery. Before I forget it, let me remind y'all that if you ever expect to swap gold for silver at spot ratios above 60:1, you had better do it quickly. I recommend swapping gold for silver now, targeting a swap back at 31:1 or better. WOW. What a week, and much of it happened today in metals! Stocks recovered this week, running toward their soon and ultimate top. US dollar index wilted. White metals also zoomed up. US Dollar Index melted, falling through the uptrend line that had caught it since last November. Since mid-September it has range-traded from 81.60 to 79.75, and now is drawing close to that lower boundary. It also is nearing the downtrend line from September, same line it broke through upward as December closed. A fall through that line, which stands about at the bottom of the trading range, about 80, would foretell much pain. Today the dollar index lost 18 more basis points (0.22%) to end at 80.18. Big gainer from the Dollar index's fall was the euro, which rose 0.15% to $1.3698, beating its head on the old uptrend line it fell through in January. I have it on my list to buy euros right after I have all my teeth pulled by an orangutan wielding wire pliers. I like to pile one killer pain atop another. Yen hardly budged today, up 0.385 to 98.22 cents/Y100. Momentum is up, NGM's determination is down -- which do y'all think will win? I note in passing that the 10 year US treasury note yield rose 0.37% today to 2.746%. It's skating above its 20 DMA, above its 200 dma, trading sideways. Better watch it. The Federal Reserve's house of cards begins trembling when it breaks above 3.1%. STOCKS spent the last week recovering from their gigantic January fall. Dow gained 126.8 (0.79%) to 16,154.39, S&P500 clumb 8.8 (0.48%) to 1,838.63. Mercy, y'all, this is a doomed effort. It can end sooner, or it can end later, but end it will by end-May. Oh, the weeping, wailing, and gnashing of profits! Please, protect yourselves. Whooo! That Dow in Silver put some HEAVY sinkers on its line today and sank, sank, sank. Ended down 4.04% (31.72 oz) at 754.14 oz, breathing hard down the neck of the 200 DMA at 738.95 oz. Crossing below that will turn momentum unarguably down. Dow in gold lost 0.62% to close at 12.25 oz (G$253.23 gold dollars). All indicators speak with one witness: DOWN. Y'all enjoy your weekend! Argentum et aurum comparenda sunt -- -- Gold and silver must be bought. - Franklin Sanders, The Moneychanger The-MoneyChanger.com © 2014, The Moneychanger. May not be republished in any form, including electronically, without our express permission. To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $3,130.00; silver's primary is up targeting 16:1 gold/silver ratio or $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold or 18 ounces of silver. or 18 ounces of silver. US $ and US$-denominated assets, primary trend down; real estate bubble has burst, primary trend down. WARNING AND DISCLAIMER. Be advised and warned: Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures. NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps. NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced. NOR do I recommend buying gold and silver on margin or with debt. What DO I recommend? Physical gold and silver coins and bars in your own hands. One final warning: NEVER insert a 747 Jumbo Jet up your nose. | |
| The Gold Price Is Rising. What’s Gold’s Message? Posted: 14 Feb 2014 02:59 PM PST This article is an excerpt from an excellent analysis by the main editor at acting-man.com (source). The idea is as follows: gold has a habit of discounting the future far in advance. This is why its price inter alia actually fell in an environment that should have been very bullish. With the Fed and the BoJ both engaging in ‘QE’ to a never before seen extent in 2013, many people thought that gold should rise rather than fall in price. However, the gold market seemed more focused on the fact that the various actions by central banks (including the ECB) had removed quite a bit of the previously extant risk premiums from the markets. ‘Safe haven’ currencies like the Swiss franc and the yen began to fall when it e.g. became clear that the euro area would not immediately blow up. Also, the gold market likely anticipated that there would be an increase in economic activity in the US (note: we regard ‘activity’ in this context not necessarily as a sign of genuine, sustainable economic growth) and that the federal budget deficit would as a result decline. This in turn made the eventual removal of the hyper-accommodative Fed policy more likely. Of course there was a long period of time when it seemed just as likely that ‘QE’ would be increased rather than reduced and we actually happen to think that the current ‘tapering’ phase will eventually be reversed. Alternatively, other major monetary pumping measures may eventually be taken. One reason to believe so is precisely the fact that the gold price is now rising in the face of ‘QE tapering’. It represents an early warning sign. Gold may be warning of a coming ‘unexpected’ reversal in economic activity as a result of the current sharp slowdown in money supply growth. There is also a possibility – more remote, but it cannot be dismissed out of hand – that there will be an unexpected increase in ‘inflation expectations’ not too far down the road. So far, the huge increase in the money supply since 2008 has only affected asset prices, but there is no guarantee that this will remain to be the case. Admittedly, we believe it at the moment more likely that the economy will weaken and that the central bank will in reaction to that embark on another round of monetary inflation. In recent years, a weakening of economic activity has generally been associated with sharp declines in inflation expectations and the growth rate of official ‘price level’ measures such as CPI. It is however also possible – this is something that was after all experienced in the 1970s – that weakening economic activity and rising inflation expectations will go hand in hand. What will precisely happen is a matter of contingent circumstances that cannot be foreseen with any degree of precision. What can be stated with a reasonably degree of certainty is only this: if money supply growth continues to falter, then a number of asset price bubbles as well as the economy will eventually falter as well. All the economic activities that depend on continuing or even accelerating monetary inflation will have to be abandoned. Since these activities consume rather than produce wealth, this is actually a good thing, but it will register as a recession in the official data and hence be regarded as ‘bad’. The Fed will undoubtedly swing into action if, or rather when, that happens.
| |
| Silver Price Breaking Out And Moving To $26 Posted: 14 Feb 2014 02:38 PM PST The advance on the daily Silver chart has completed an 11-week rectangle bottom. This is the first significant bullish signal in Silver since the advances in September 2010 and February 2011. The pattern target on the daily chart is 22.00 — a price already being approached. Further targets are possible, including the August 2013 high at 25.12 and the 2011 and 2012 lows at 26.15. These levels can be best seen on the weekly and monthly charts. I believe the supply at 26.15 could curtail the Silver market in the forseeable futures.
Author: Peter Brandt entered the commodity trading business in 1976 with ContiCommodity Services, a division of Continental Grain Company. Visit his website PeterLBrandt.com. | |
| Gold Daily and Silver Weekly Charts - Dead on Target Posted: 14 Feb 2014 01:52 PM PST | |
| Gold Daily and Silver Weekly Charts - Dead on Target Posted: 14 Feb 2014 01:52 PM PST | |
| The Essentialist’s Glossary: Updated for the ‘Teens (A-F) Posted: 14 Feb 2014 12:50 PM PST
Age of Ignorance
All of the Problems
Antifragile
Bear Market
Bed and Breakfast Stage
The Bernank
Bill Gates
Bitcoin
Black Swan
Broker
Crowdfunding
Cybersecurity
Cyberwarfare
Bull Market
The "C" Spot
Call Option
Cash Flow
Central Banking
Cisco
Creative Destruction
Day Trader
Dirigisme
Dollar
Erfahrung
Esperanto Money
Financial Planner
Forward Guidance Policy
Fracking Ed. Note: Perhaps you have your own definitions? Send 'em to us here: dr@dailyreckoning.com. After we receive them, we’ll screen them to make sure they pass the Presbyterian standard… then include them in the glossary. Soon we'll have a permanent section for them. In the meantime, sign up for the FREE Daily Reckoning email edition, to read them before anyone else. | |
| Posted: 14 Feb 2014 12:40 PM PST Let's put this into perspective. When did anyone in the mainstream media say gold was a great investment? What you are hearing is a huge bias not borne out by the facts. - Robert Wiedemer, "100% Fake Recovery" LINK Gold has been the best performing asset since the Fed tapering began on December 18th, 2013. Most analysts were, and many still are, calling for gold to hit $875 this year. How they arrived at that conclusion is beyond rational comprehension, given that if gold stayed below $1200 for any length of time most gold mines would be shuttered. Moreover, almost every bearish Wall Street analyst never even considers the enormous amount of gold being accumulated by China. I don't understand how these people can call themselves professionals when they are ignoring two obviously fundamental variables affecting the price of gold. As we know, belief without evidence is nothing but faith. It would seem to me that Wall Street is exercising bad faith in their assessment of the gold market. At any rate, the fact and evidence stands that gold has been outperforming everything since mid-December. One reason for this is that the Fed and the bullion banks have been forced by the sheer size of the demand from Asia to "retreat" from the unprecedented manipulation of the price of gold over the last 2 years. The reason for the "retreat" is to let the price of gold rise in an attempt to slow down the massive demand for physical gold. But there are several fundamental reasons that investors now perceive gold to be undervalued, especially relative to the U.S. stock market. First, there's no question now that the U.S. economy is rapidly slowing down. Auto, retail and home sales are declining and it's becoming clear that the cold weather/dog ate my homework excuse is not cutting it. Again, when you look at data available that Wall Street and CNBC conveniently overlook, it's pretty obvious that the majority of Americans are cash strapped, have piled on new debt and are living from hand to mouth. I doubt 99%'ers are going to be rushing out this to buy a new Lennar home and a shiny BMW for the driveway this year. Because of this, it is probable that Janet Yellen will have to reverse the taper and start printing even more money than the $65 billion/month being printed after the first two tapers. Let's not forget, taper or not, the Fed is still printing at a rate of $780 billion per year. In addition, assuming Stanley Fisher is confirmed as Yellen's partner in crime, we can expect to see them implement a negative Fed funds rate policy. Most people are unaware of this, but Fisher is a huge academic proponent of negative interest rates as a means to try and stimulate economic growth (Israeli-born, he was an economics professor at the University of Chicago and at MIT before going on to try and destroy the world with his ideas). Furthermore, Janet Yellen launched her bid to replace Bernanke with a speech in early 2012 advocating negative rates to stimulate employment. For the record, negative interest rates are gold's rocket fuel. Finally, I find it curious that very little attention has been paid to the fact that the Government is now operating until March 15, 2015 without any debt ceiling limit. Quite frankly, there should be outrage from both the media and the public. No one seemed to even notice. But letting the Government go for a year without ANY spending restraints is the equivalent of letting a multi-convicted pedophile operate a daycare center that has a sleepover option for parents who travel a lot. In my view, unlike most mainstream investors, the smart money buying gold did happen to take notice of the unlimited credit card that Congress just gave the Obama Government. It actually became obvious last Friday to those few of us who do follow the news that affects our system that Boehner's House would pass a "clean" debt issuance extension. Since last Friday gold is up $57, or 4.5%. The GDXJ junior mining stock index is up 14%. In comparison, the S&P 500 is up 2.6%. Things are going to start to really unravel in our economic and political system this year. As the underlying conditions deteriorate expect the Orwellian "things are getting better" lies to intensify. Try to enjoy what you can, while can because life will likely become a lot more difficult for most of us this year. | |
| Posted: 14 Feb 2014 12:40 PM PST Let's put this into perspective. When did anyone in the mainstream media say gold was a great investment? What you are hearing is a huge bias not borne out by the facts. - Robert Wiedemer, "100% Fake Recovery" LINK Gold has been the best performing asset since the Fed tapering began on December 18th, 2013. Most analysts were, and many still are, calling for gold to hit $875 this year. How they arrived at that conclusion is beyond rational comprehension, given that if gold stayed below $1200 for any length of time most gold mines would be shuttered. Moreover, almost every bearish Wall Street analyst never even considers the enormous amount of gold being accumulated by China. I don't understand how these people can call themselves professionals when they are ignoring two obviously fundamental variables affecting the price of gold. As we know, belief without evidence is nothing but faith. It would seem to me that Wall Street is exercising bad faith in their assessment of the gold market. At any rate, the fact and evidence stands that gold has been outperforming everything since mid-December. One reason for this is that the Fed and the bullion banks have been forced by the sheer size of the demand from Asia to "retreat" from the unprecedented manipulation of the price of gold over the last 2 years. The reason for the "retreat" is to let the price of gold rise in an attempt to slow down the massive demand for physical gold. But there are several fundamental reasons that investors now perceive gold to be undervalued, especially relative to the U.S. stock market. First, there's no question now that the U.S. economy is rapidly slowing down. Auto, retail and home sales are declining and it's becoming clear that the cold weather/dog ate my homework excuse is not cutting it. Again, when you look at data available that Wall Street and CNBC conveniently overlook, it's pretty obvious that the majority of Americans are cash strapped, have piled on new debt and are living from hand to mouth. I doubt 99%'ers are going to be rushing out this to buy a new Lennar home and a shiny BMW for the driveway this year. Because of this, it is probable that Janet Yellen will have to reverse the taper and start printing even more money than the $65 billion/month being printed after the first two tapers. Let's not forget, taper or not, the Fed is still printing at a rate of $780 billion per year. In addition, assuming Stanley Fisher is confirmed as Yellen's partner in crime, we can expect to see them implement a negative Fed funds rate policy. Most people are unaware of this, but Fisher is a huge academic proponent of negative interest rates as a means to try and stimulate economic growth (Israeli-born, he was an economics professor at the University of Chicago and at MIT before going on to try and destroy the world with his ideas). Furthermore, Janet Yellen launched her bid to replace Bernanke with a speech in early 2012 advocating negative rates to stimulate employment. For the record, negative interest rates are gold's rocket fuel. Finally, I find it curious that very little attention has been paid to the fact that the Government is now operating until March 15, 2015 without any debt ceiling limit. Quite frankly, there should be outrage from both the media and the public. No one seemed to even notice. But letting the Government go for a year without ANY spending restraints is the equivalent of letting a multi-convicted pedophile operate a daycare center that has a sleepover option for parents who travel a lot. In my view, unlike most mainstream investors, the smart money buying gold did happen to take notice of the unlimited credit card that Congress just gave the Obama Government. It actually became obvious last Friday to those few of us who do follow the news that affects our system that Boehner's House would pass a "clean" debt issuance extension. Since last Friday gold is up $57, or 4.5%. The GDXJ junior mining stock index is up 14%. In comparison, the S&P 500 is up 2.6%. Things are going to start to really unravel in our economic and political system this year. As the underlying conditions deteriorate expect the Orwellian "things are getting better" lies to intensify. Try to enjoy what you can, while can because life will likely become a lot more difficult for most of us this year. | |
| Gold best defense against ruinous inflation and deflation, von Greyerz says Posted: 14 Feb 2014 11:44 AM PST 10:36a ET Friday, February 14, 2014 Dear Friend of GATA and Gold: Swiss gold fund manager Egon von Greyerz tells King World News today about the ruinous inflationary and deflationary pressures in the world financial system, against which gold is the best defense: CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT A Personal Touch in Buying Precious Metals If you've not secured your allocation of precious metals and numismatic coins, 2014 may be the last year to get them at affordable and undervalued prices. With huge amounts of gold leaving the West for Asia, the future availability of precious metals is very much in doubt. All Pro Gold has competitive pricing on all bullion and numismatic products -- and offers prompt delivery too. Long-time GATA supporters Fred Goldstein and Tim Murphy are glad to answer any questions or concerns about acquiring the monetary metals. All Pro Gold has an extensive electronic library of articles from the world's top market analysts. Learn more at www.allprogold.com or write to Fred and Tim at info@allprogold.com or telephone them at 1-855-377-4653. Join GATA here: 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 Jim Sinclair plans seminar in Austin Gold advocate and mining entrepreneur Jim Sinclair will hold his next market seminar from 2 to 6 p.m. Saturday, February 8, at the Austin, Texas, Airport Hilton. Advance registration is required. Details for the Austin seminar are posted at JSMineSet.com here: http://www.jsmineset.com/2014/01/02/austin-texas-qa-session-confirmed/ | |
| Fractional reserve bullion banking and gold bank runs: bank run theory Posted: 14 Feb 2014 11:33 AM PST Perth Mint | |
| Blaming the Slowdown on the Snow Posted: 14 Feb 2014 10:32 AM PST Bad weather makes a good excuse for the marked turnaround in US economic data... SO I have been shoveling snow all winter, writes Miguel Perez-Santalla at BullionVault. So has everyone else where I live on the US East Coast. I have bought plenty of chemical salts for melting ice. People in my neighborhood bought new snow blowers, too. I see young people out clearing snow with small plows and shovels. Burning gasoline is definitely one uptick for the economy. The snow seems to create plenty of other side jobs as well. Landscapers have work plowing, removing fallen trees and branches. In times of severe weather manual labor is up. Then these laborers spend on consumables at home. Internet shopping is up, and all sorts of media consumption rises as well. Video games, movies and Netflix are booming. Retail sales of goods and services will show spikes as people get set for another storm. But the recent numbers...? Lower than expected retail sales, down 0.4% when expected flat. Lower than expected employment numbers too. Net additions to Non-Farm Payrolls were reported at 113,000 for January, when expectations were for 185,000. Yet then the government reports the Unemployment Rate down to 6.6%? I am not writing about politics here. I am writing about interpretation of the numbers. For months the Federal Reserve, government politicians and the US major media have been touting a growing US economy basis the positive GDP and falling unemployment numbers. However, the problem lies in the interpretation and not in the real figures presented. The unemployment number in the US represents those unemployed people who are seeking work. Those that have given up on finding work, at a reasonable pay, are no longer counted. This is called attrition of the workforce. It means we have fewer people in this country looking for work, as a percentage of the working-age population, than any time since 1978. This number, the Participation Rate, was last reported at 62.8%. But still, the GDP at last release was reported at a 3.2% growth rate. Which sounds strong. But again, while this number gives the appearance of healthy positive growth, when you delve into the report it becomes apparent that something is amiss. Personal Inventories for instance were high, meaning that goods were produced and not sold yet. Discounting this statistic brings GDP growth down to an adjusted 2.8%, which is less to brag about. Away from the headline data, then, the US economy is not improving as strongly as we might be led to believe. Indeed, I fear it has flat lined. There are fewer people, as a proportion of the population, now working. And they have to support those family members that do not have gainful employment. The media claim it is "baby boomers" leaving the workforce, but they still need to work. Additionally, the newer generation nicknamed the "millennials" are also having difficulty finding employment. If they do find jobs, they are not at reasonable pay scales. Especially not considering their expenditures for a college education, and are often without health benefits. This explains other, recent poor statistics. Because those that have employment have higher expenses and more dependents. So people often have to live beyond their means, as indicated by the increase in unsecured Consumer Credit. This means there are fewer discretionary dollars available for the purchase of goods and services. Sure, maybe the recent good news of continued growth in China may spur more growth in the US economy. But again, the headline data obscure the true picture there. It's become clear that China's credit and investment bubble is ready to burst. There is no doubt that many institutional investors have taken note of these same points. Big-money investors have taken advantage of last year's rout in the gold price, and are beginning to rebalance their portfolios by adding bullion back onto their books. Foreign central banks also look sure to continue adding to their physical reserves as well. In fact, many other experts believe the People's Bank has been quietly buying gold for China's reserves while underreporting those holdings to the rest of the world. Whatever the case, gold is in position to resume its place in the market as the only reliable alternative currency. The recent emerging markets turmoil has sent a strong signal about the fragile nature of currency markets. South Africa, India and Turkey were recent darlings but now are a pariah. After 43 years of our floating and fiat currency experiment, it remains to be seen whether the more recent monetary experiments by the Federal Reserve and the European Central Bank, with their continued machinations and tweaking, will be successful. Meanwhile, as the east coast of the United States is bombarded yet again by Old Man Winter, the talking heads in the mainstream media continue to blame the weakness of the economy on the weather. The underlying truth tells another story. I think this explains the recent and well-built rally in the gold price. | |
| Blaming the Slowdown on the Snow Posted: 14 Feb 2014 10:32 AM PST Bad weather makes a good excuse for the marked turnaround in US economic data... SO I have been shoveling snow all winter, writes Miguel Perez-Santalla at BullionVault. So has everyone else where I live on the US East Coast. I have bought plenty of chemical salts for melting ice. People in my neighborhood bought new snow blowers, too. I see young people out clearing snow with small plows and shovels. Burning gasoline is definitely one uptick for the economy. The snow seems to create plenty of other side jobs as well. Landscapers have work plowing, removing fallen trees and branches. In times of severe weather manual labor is up. Then these laborers spend on consumables at home. Internet shopping is up, and all sorts of media consumption rises as well. Video games, movies and Netflix are booming. Retail sales of goods and services will show spikes as people get set for another storm. But the recent numbers...? Lower than expected retail sales, down 0.4% when expected flat. Lower than expected employment numbers too. Net additions to Non-Farm Payrolls were reported at 113,000 for January, when expectations were for 185,000. Yet then the government reports the Unemployment Rate down to 6.6%? I am not writing about politics here. I am writing about interpretation of the numbers. For months the Federal Reserve, government politicians and the US major media have been touting a growing US economy basis the positive GDP and falling unemployment numbers. However, the problem lies in the interpretation and not in the real figures presented. The unemployment number in the US represents those unemployed people who are seeking work. Those that have given up on finding work, at a reasonable pay, are no longer counted. This is called attrition of the workforce. It means we have fewer people in this country looking for work, as a percentage of the working-age population, than any time since 1978. This number, the Participation Rate, was last reported at 62.8%. But still, the GDP at last release was reported at a 3.2% growth rate. Which sounds strong. But again, while this number gives the appearance of healthy positive growth, when you delve into the report it becomes apparent that something is amiss. Personal Inventories for instance were high, meaning that goods were produced and not sold yet. Discounting this statistic brings GDP growth down to an adjusted 2.8%, which is less to brag about. Away from the headline data, then, the US economy is not improving as strongly as we might be led to believe. Indeed, I fear it has flat lined. There are fewer people, as a proportion of the population, now working. And they have to support those family members that do not have gainful employment. The media claim it is "baby boomers" leaving the workforce, but they still need to work. Additionally, the newer generation nicknamed the "millennials" are also having difficulty finding employment. If they do find jobs, they are not at reasonable pay scales. Especially not considering their expenditures for a college education, and are often without health benefits. This explains other, recent poor statistics. Because those that have employment have higher expenses and more dependents. So people often have to live beyond their means, as indicated by the increase in unsecured Consumer Credit. This means there are fewer discretionary dollars available for the purchase of goods and services. Sure, maybe the recent good news of continued growth in China may spur more growth in the US economy. But again, the headline data obscure the true picture there. It's become clear that China's credit and investment bubble is ready to burst. There is no doubt that many institutional investors have taken note of these same points. Big-money investors have taken advantage of last year's rout in the gold price, and are beginning to rebalance their portfolios by adding bullion back onto their books. Foreign central banks also look sure to continue adding to their physical reserves as well. In fact, many other experts believe the People's Bank has been quietly buying gold for China's reserves while underreporting those holdings to the rest of the world. Whatever the case, gold is in position to resume its place in the market as the only reliable alternative currency. The recent emerging markets turmoil has sent a strong signal about the fragile nature of currency markets. South Africa, India and Turkey were recent darlings but now are a pariah. After 43 years of our floating and fiat currency experiment, it remains to be seen whether the more recent monetary experiments by the Federal Reserve and the European Central Bank, with their continued machinations and tweaking, will be successful. Meanwhile, as the east coast of the United States is bombarded yet again by Old Man Winter, the talking heads in the mainstream media continue to blame the weakness of the economy on the weather. The underlying truth tells another story. I think this explains the recent and well-built rally in the gold price. | |
| Blaming the Slowdown on the Snow Posted: 14 Feb 2014 10:32 AM PST Bad weather makes a good excuse for the marked turnaround in US economic data... SO I have been shoveling snow all winter, writes Miguel Perez-Santalla at BullionVault. So has everyone else where I live on the US East Coast. I have bought plenty of chemical salts for melting ice. People in my neighborhood bought new snow blowers, too. I see young people out clearing snow with small plows and shovels. Burning gasoline is definitely one uptick for the economy. The snow seems to create plenty of other side jobs as well. Landscapers have work plowing, removing fallen trees and branches. In times of severe weather manual labor is up. Then these laborers spend on consumables at home. Internet shopping is up, and all sorts of media consumption rises as well. Video games, movies and Netflix are booming. Retail sales of goods and services will show spikes as people get set for another storm. But the recent numbers...? Lower than expected retail sales, down 0.4% when expected flat. Lower than expected employment numbers too. Net additions to Non-Farm Payrolls were reported at 113,000 for January, when expectations were for 185,000. Yet then the government reports the Unemployment Rate down to 6.6%? I am not writing about politics here. I am writing about interpretation of the numbers. For months the Federal Reserve, government politicians and the US major media have been touting a growing US economy basis the positive GDP and falling unemployment numbers. However, the problem lies in the interpretation and not in the real figures presented. The unemployment number in the US represents those unemployed people who are seeking work. Those that have given up on finding work, at a reasonable pay, are no longer counted. This is called attrition of the workforce. It means we have fewer people in this country looking for work, as a percentage of the working-age population, than any time since 1978. This number, the Participation Rate, was last reported at 62.8%. But still, the GDP at last release was reported at a 3.2% growth rate. Which sounds strong. But again, while this number gives the appearance of healthy positive growth, when you delve into the report it becomes apparent that something is amiss. Personal Inventories for instance were high, meaning that goods were produced and not sold yet. Discounting this statistic brings GDP growth down to an adjusted 2.8%, which is less to brag about. Away from the headline data, then, the US economy is not improving as strongly as we might be led to believe. Indeed, I fear it has flat lined. There are fewer people, as a proportion of the population, now working. And they have to support those family members that do not have gainful employment. The media claim it is "baby boomers" leaving the workforce, but they still need to work. Additionally, the newer generation nicknamed the "millennials" are also having difficulty finding employment. If they do find jobs, they are not at reasonable pay scales. Especially not considering their expenditures for a college education, and are often without health benefits. This explains other, recent poor statistics. Because those that have employment have higher expenses and more dependents. So people often have to live beyond their means, as indicated by the increase in unsecured Consumer Credit. This means there are fewer discretionary dollars available for the purchase of goods and services. Sure, maybe the recent good news of continued growth in China may spur more growth in the US economy. But again, the headline data obscure the true picture there. It's become clear that China's credit and investment bubble is ready to burst. There is no doubt that many institutional investors have taken note of these same points. Big-money investors have taken advantage of last year's rout in the gold price, and are beginning to rebalance their portfolios by adding bullion back onto their books. Foreign central banks also look sure to continue adding to their physical reserves as well. In fact, many other experts believe the People's Bank has been quietly buying gold for China's reserves while underreporting those holdings to the rest of the world. Whatever the case, gold is in position to resume its place in the market as the only reliable alternative currency. The recent emerging markets turmoil has sent a strong signal about the fragile nature of currency markets. South Africa, India and Turkey were recent darlings but now are a pariah. After 43 years of our floating and fiat currency experiment, it remains to be seen whether the more recent monetary experiments by the Federal Reserve and the European Central Bank, with their continued machinations and tweaking, will be successful. Meanwhile, as the east coast of the United States is bombarded yet again by Old Man Winter, the talking heads in the mainstream media continue to blame the weakness of the economy on the weather. The underlying truth tells another story. I think this explains the recent and well-built rally in the gold price. | |
| Questor: How to profit from gold rally Posted: 14 Feb 2014 10:31 AM PST John Ficenec says the gold price is up 10pc this year. So how can you take advantage of any other increases this year? 
| |
| $10,000 Gold, $50,000 Gold & The Coming Frightening Chaos Posted: 14 Feb 2014 10:18 AM PST  On the heels of another wild trading week, today a 42-year market veteran spoke with King World News about the coming frightening chaos that investors around the world need to be brace for, as well as $10,000 gold, $50,000 gold and much more. Below is the powerful interview with Egon von Greyerz, who is founder of Matterhorn Asset Management out of Switzerland.This posting includes an audio/video/photo media file: Download Now | |
| Eric Sprott on the upward reversals in gold and silver Posted: 14 Feb 2014 10:05 AM PST 1p ET Friday, February 14, 2014 Dear Friend of GATA and Gold: Sprott Asset Management CEO Eric Sprott comments today on the upward reversal of gold and silver prices, his expectation of a spectacular year for the shares of monetary metals mining companies, and the hastening devaluations of currencies around the world. The interview is not quite nine minutes long and can be heard at Sprott Money News here: http://www.sprottmoney.com/sprott-money-weekly-wrap-up CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Buy metals at GoldMoney and enjoy international storage GoldMoney was established in 2001 by James and Geoff Turk and is safeguarding more than $1.7 billion in metals and currencies. Buy gold, silver, platinum, and palladium from GoldMoney over the Internet and store them in vaults in Canada, Hong Kong, Singapore, Switzerland, and the United Kingdom, taking advantage of GoldMoney's low storage rates, among the most competitive in the industry. GoldMoney also offers delivery of 100-gram and 1-kilogram gold bars and 1-kilogram silver bars. To learn more, please visit: http://www.goldmoney.com/?gmrefcode=gata Join GATA here: 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 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... | |
| Posted: 14 Feb 2014 09:50 AM PST "The Fed insists on saving us from 'everyday low prices'. They call it deflation" - James Grant CONSIDER the following table, says Tim Price on his PriceOfEverything blog, republished at the Cobden Centre. It comes by way of iShares by Blackrock (not a fragrance), via Barry Ritholtz and Absolute Return Partners. It shows the recommended positioning of Wall Street's finest with regard to bond markets (fixed income, or FI) and equities. This exercise may well show that when everyone is thinking the same, nobody is really thinking at all...  As far as the sell side was concerned, brash individualism and bold contrarianism died some time during 2013. By the start of 2014, all that remained on Wall Street was the hive mind of the Borg – a rather bland consensus that bonds were bad and equities were good. Astonishing that stockbrokers might possibly nurse such bias. So January's primary trends (bonds rallying, and equities tanking), if sustained, may serve to remind us all that unsolicited sell side research, being to all intents and purposes free, is worth precisely what folk pay for it. If the last investor is already loaded up to the gills on stocks, where is the greater fool to whom those stocks can then be sold? January may have given us an answer. Pimco's Bill Gross comes to a similar conclusion in his latest investment outlook, from which the following is taken:
Astonishing, too, that the world's largest bond manager might possibly nurse such bias in favour of "high quality bonds". Especially when they're not (high quality, that is) – there just happen to be oodles of them. But the fact remains that investors seem to have been spooked by the final arrival of Fed tapering, and those in emerging markets doubly so. But since we're all trapped in what James Grant calls that valuation 'hall of mirrors', courtesy of central banks endlessly tinkering with asset prices via the most aggressive monetary stimulus in world history, it's not remotely easy trying to foresee the outlook for either bonds, or stocks, or anything else. Rather than just abandon the field and sit disgruntled on the sidelines in cash, our response is to seek solace in the most compelling examples of deep value we can find, both in the credit market and in stocks. Tim Lee of Pi Economics also sees evidence of a growing deflation shock. His chart below shows that a proxy for global broad money growth (a simple weighted average of money growth rates for the US, the Eurozone, the UK and Japan) peaked in 2011 and now appears to be rolling over.  Tim now expects major equity markets to continue to decline as the crisis in the 'Fragile Five' economies accelerates.
If this comes to pass, Wall Street will have managed to get its asset allocation advice for 2014 precisely wrong on both counts. Developed equities will fall, while fixed income (notably US Treasuries) will rally further. Macro hypothesizing is all very well, but it at least partly assumes that the hypothesizer is benchmarked and in our case, we're not. We don't currently have significant exposure to developed world equities since we see much more compelling value (in classic Graham & Dodd terms) in certain pockets of the Asian markets. And we currently have no exposure to US Treasuries because we can access higher real yields with objectively superior credit quality elsewhere. That is, of course, a raging anomaly, but we never said markets were entirely or even necessarily remotely rational. We always thought that markets (in both the debt and equity spheres) were overly complacent about the risks associated with Fed tapering. Last year, for example, the Fed printed and bought $500 billion-worth of US Treasuries – and the Treasury market still went down. The idea that the Treasury market would shrug off the determined departure of its biggest buyer in 2014 always seemed nonsensical. Now, however, there is increasing reason to fear deflationary forces at work throughout most of the developed markets other than Japan, so the price dynamic for Treasuries has changed markedly. Similarly for developed world equities, where the gyrations of January indicate – to us – a market that is coming to the slow realisation that it has already stepped over the cliff edge. Unfortunately many investors, with central banks having slashed deposit rates to de minimis levels, have gone 'all-in' with regard to risk assets in the desperate pursuit of yield. Be careful what you wish for. It is quite clear that central banks will do literally anything within their power to attempt to avert deflation – to ensure that "it cannot happen here". That does not mean they will succeed – but they may end up destroying fiat currencies in the process (one of the reasons we have consistently held gold). Tim Lee believes it is "quite obvious" what the Fed will ultimately do:
The problem is that this would be a very big step; a further violation of the 'rules' of central banking. And we have a new Fed chairman, who has only just taken office. It is likely that things will have to get very bad before that very big step can be taken. Six years into this crisis, and in the words of Lily Tomlin, things are going to get a lot worse before they get worse. From our perspective as asset managers, it comes down to a simple mantra: continually question precisely what you own, and why you own it. | |
| Posted: 14 Feb 2014 09:50 AM PST "The Fed insists on saving us from 'everyday low prices'. They call it deflation" - James Grant CONSIDER the following table, says Tim Price on his PriceOfEverything blog, republished at the Cobden Centre. It comes by way of iShares by Blackrock (not a fragrance), via Barry Ritholtz and Absolute Return Partners. It shows the recommended positioning of Wall Street's finest with regard to bond markets (fixed income, or FI) and equities. This exercise may well show that when everyone is thinking the same, nobody is really thinking at all... As far as the sell side was concerned, brash individualism and bold contrarianism died some time during 2013. By the start of 2014, all that remained on Wall Street was the hive mind of the Borg – a rather bland consensus that bonds were bad and equities were good. Astonishing that stockbrokers might possibly nurse such bias. So January's primary trends (bonds rallying, and equities tanking), if sustained, may serve to remind us all that unsolicited sell side research, being to all intents and purposes free, is worth precisely what folk pay for it. If the last investor is already loaded up to the gills on stocks, where is the greater fool to whom those stocks can then be sold? January may have given us an answer. Pimco's Bill Gross comes to a similar conclusion in his latest investment outlook, from which the following is taken:
Astonishing, too, that the world's largest bond manager might possibly nurse such bias in favour of "high quality bonds". Especially when they're not (high quality, that is) – there just happen to be oodles of them. But the fact remains that investors seem to have been spooked by the final arrival of Fed tapering, and those in emerging markets doubly so. But since we're all trapped in what James Grant calls that valuation 'hall of mirrors', courtesy of central banks endlessly tinkering with asset prices via the most aggressive monetary stimulus in world history, it's not remotely easy trying to foresee the outlook for either bonds, or stocks, or anything else. Rather than just abandon the field and sit disgruntled on the sidelines in cash, our response is to seek solace in the most compelling examples of deep value we can find, both in the credit market and in stocks. Tim Lee of Pi Economics also sees evidence of a growing deflation shock. His chart below shows that a proxy for global broad money growth (a simple weighted average of money growth rates for the US, the Eurozone, the UK and Japan) peaked in 2011 and now appears to be rolling over. Tim now expects major equity markets to continue to decline as the crisis in the 'Fragile Five' economies accelerates.
If this comes to pass, Wall Street will have managed to get its asset allocation advice for 2014 precisely wrong on both counts. Developed equities will fall, while fixed income (notably US Treasuries) will rally further. Macro hypothesizing is all very well, but it at least partly assumes that the hypothesizer is benchmarked and in our case, we're not. We don't currently have significant exposure to developed world equities since we see much more compelling value (in classic Graham & Dodd terms) in certain pockets of the Asian markets. And we currently have no exposure to US Treasuries because we can access higher real yields with objectively superior credit quality elsewhere. That is, of course, a raging anomaly, but we never said markets were entirely or even necessarily remotely rational. We always thought that markets (in both the debt and equity spheres) were overly complacent about the risks associated with Fed tapering. Last year, for example, the Fed printed and bought $500 billion-worth of US Treasuries – and the Treasury market still went down. The idea that the Treasury market would shrug off the determined departure of its biggest buyer in 2014 always seemed nonsensical. Now, however, there is increasing reason to fear deflationary forces at work throughout most of the developed markets other than Japan, so the price dynamic for Treasuries has changed markedly. Similarly for developed world equities, where the gyrations of January indicate – to us – a market that is coming to the slow realisation that it has already stepped over the cliff edge. Unfortunately many investors, with central banks having slashed deposit rates to de minimis levels, have gone 'all-in' with regard to risk assets in the desperate pursuit of yield. Be careful what you wish for. It is quite clear that central banks will do literally anything within their power to attempt to avert deflation – to ensure that "it cannot happen here". That does not mean they will succeed – but they may end up destroying fiat currencies in the process (one of the reasons we have consistently held gold). Tim Lee believes it is "quite obvious" what the Fed will ultimately do:
The problem is that this would be a very big step; a further violation of the 'rules' of central banking. And we have a new Fed chairman, who has only just taken office. It is likely that things will have to get very bad before that very big step can be taken. Six years into this crisis, and in the words of Lily Tomlin, things are going to get a lot worse before they get worse. From our perspective as asset managers, it comes down to a simple mantra: continually question precisely what you own, and why you own it. | |
| Erosion of Trust Will Drive Gold Price Higher Posted: 14 Feb 2014 09:42 AM PST Q&A with Casey Research James Turk, founder of precious metals accumulation pioneer GoldMoney, has over 40 years' experience in international banking, finance, and investments. He began his career at the Chase Manhattan Bank and in 1983 was appointed manager of the commodity department of the Abu Dhabi Investment Authority. In his new book The Money Bubble: What to Do Before It Pops, James and coauthor John Rubino warn that history is about to repeat. Instead of addressing the causes of the 2008 financial crisis, the world's governments have continued along the same path. Anotherâ€"even biggerâ€"crisis is coming, and this one, say the authors, will change everything. | |
| A Blindford, a Dart, and a Winning Gold Miner Stock Posted: 14 Feb 2014 09:42 AM PST Really it's that simple after the December sell-off, says Bob Moriarty... BOB and BARB Moriarty brought 321gold.com to the internet more than 10 years ago, later adding 321energy.com to cover oil, natural gas, gasoline, coal, solar, wind and nuclear energy. Both sites feature articles, editorial opinions, pricing figures and updates on current events affecting both sectors. And according to Bob Moriarty – previously a Marine F-4B and O-1 pilot with more than 820 missions in Vietnam and holding 14 international aviation records – "fact that everyone hated gold in December is a good reason for rational people to love it now." Indeed, as he tells The Gold Report here, many good gold mining stocks now sell for "peanuts". All you need to pick a winner is a blindfold and a dart... The Gold Report: Bob, in the last few weeks, Argentina and Venezuela have devalued their currencies and the central banks in Turkey and South Africa hiked interest rates. The US Federal Reserve cut its monthly bond buying by another $10 billion. What do you make of all this happening in such a short timeframe? Bob Moriarty: In a way, I will take credit for having predicted it. The world is bankrupt, and not one government is talking about reducing expenses. They talk about austerity, but austerity means living within one's means. Governments refuse to do that. The Fed has three options: It can continue to taper, maintain the status quo or increase its bond buying. I think there's a good chance it will take that third option. We need a big crash first. TGR: What message does that send to the general market? Bob Moriarty: It says we've run out of bullets, head for your bunker. TGR: That can't be the message the Fed wants to send. Bob Moriarty: The message it intends to send is one thing; the message it actually sends is something else. Events in 2008 were only the opening act. The financial instability and the pressures in the markets are far worse today than they were in 2008. We had the chance to fix things back then, but Ben Bernanke, Alan Greenspan and Tim Geithner panicked and made the situation far worse. TGR: You sent me an article by James Gruber titled, "Welcome to Phase Three of the Global Financial Crisis". In it, he writes, "The system broke down in 2008 and again in Europe in 2011 and now in the emerging markets in 2013 and 2014. The market reaction to the latest events has been abrupt and violent, particularly in the currency world. In my experience, markets generally cope well when there is one crisis but when there are multiple spot fires like last week, most markets don't cope well." Is there more to come? Bob Moriarty: Of course things will keep getting worse until somebody understands that the real issue is debt. There are $694 trillion in derivatives. That is financial debt that can never be paid off. The world has been a giant casino for the last 20 years, and it's all coming to a head. TGR: How does devaluing their currencies help Argentina and Venezuela? Bob Moriarty: It doesn't. Every government in the world is spending money it doesn't have. The only solution is to stop spending money. Everyone refuses to do that because governments gain power by spending money. They will spend money until they've bankrupted all of their citizens. TGR: In Greece and in Spain, the European Union has implemented mandatory austerity programs to pay off their bonds. Shouldn't Greece and Spain be seeing economic improvement now that they've implemented those severe austerity programs? Bob Moriarty: There is no economic improvement. It's all smoke and mirrors. It's similar to climbing to the top of a 50-storey building and jumping off. Once you've jumped, it doesn't matter what you do on the drop down. You're going to hit the ground. They need to crash so they can rebuild on a solid foundation. Calling it austerity is using semantics to play with the citizenry. If one honest politician stood up and said, "We're spending more money than we have. We need to stop," that would put us on the way to curing the problem. But the politicians keep pretending there are other solutions. President Obama's charade in the State of the Union message was interesting. He was a Constitutional law professor before going into politics, yet in his speech he said the president of the US can unilaterally change the minimum wage. Did he ever read the Constitution? TGR: Apparently, he does have the ability to change it, but only in upcoming, new federal contracts. Bob Moriarty: There are three separate branches in the American political system: the executive, the legislative and the judicial. The president of the US does not make laws; he enforces them. His ability to do something is not the same thing as it being legal. All federal financial bills have to start in Congress. The president of the US simply cannot change the minimum wage. It's not part of his job. TGR: Wages earned by low-wage workers aren't increasing at the same rate as inflation. As a result, the minimum wage today doesn't give the same amount of purchasing power as it did when it was first implemented. Should the minimum wage be hitched to inflation or should it just be abolished? Bob Moriarty: If you make the minimum wage $10.10/hour, people who are gainfully employed at $8.50 have lost their jobs. All minimum wage laws do is eliminate jobs. If minimum wage laws worked and helped people, we should pay everybody $100/hour. But as soon as you say $100/hour, everybody says, nobody can afford that, which is true. There are people who cannot afford $10.10/hour. There are workers not worth $10/hour. In the EU, seven countries do not have minimum wage laws, 20 do. In the seven countries without minimum wage laws, the unemployment rate is just over 8%. In the 20 countries with minimum wage laws, the rate is over 11%. Minimum wage laws, no matter how well intentioned, cost an economy jobs. The economic stability of any country is based on the number of people in its middle class. There are rich and poor people in every society. That is as true as it is meaningless. The key to economic and political stability is the size of the middle class. The policies of George Bush, which have been compounded by Barack Obama, have destroyed the middle class. TGR: How have they done that? Bob Moriarty: First, people can't save money. If you save money at 0.25%, you're insane; inflation robs you of your real wealth. Second, taxes have increased. There are something like 48 separate taxes in Obamacare that have nothing to do with healthcare. The Affordable Care Act, Obamacare, is the nail in the coffin of the middle class. It is a giant payoff to the insurance companies. The insurance companies are protected under law. They are allowed to collude and do things no other industry can. As a result, the US has one of the least effective healthcare systems in the world and the most expensive. We need to burn the healthcare system down and start all over again. The insurance companies have the American public's throats in a death grip and they're killing us. TGR: Following on the general topic of insurance, you've talked about using precious metals as an insurance policy in a crisis. Do you mean the metal, the equities or a combination of both? Bob Moriarty: I see the physical metal as an insurance policy. Once investors have that policy in place, the equities are what they do with their investments. There are some wonderful companies selling for peanuts now that will do well no matter what happens – inflation or deflation. TGR: How much of a portfolio needs to be in precious metals to have a good underlying insurance policy? Bob Moriarty: That depends on the person and the amount of money available. Everybody has a different level. If my total worldly assets were $1000, I would put all of it into silver or gold coins. If I had $100,000, I'd probably put half of it into silver and gold. If I had $1 million, the percentage would be 5-10%. I was recommending metals even when gold was $268 per ounce and silver was $4 per ounce. All investments go up and down, and investors have to be prepared for that, but that doesn't change the fact that metals are the best insurance policy. TGR: I have my insurance policy; I have my gold and silver coins. Where should I look for gold mining and precious metals stocks? Bob Moriarty: You need two things: a blindfold and a dart. TGR: But you just said there were some really special companies selling for peanuts. Bob Moriarty: Yes, but the way to pick them is with a blindfold and a dart. TGR: Are some opportunities better than others, or do you believe the entire sector will improve? After all, some analysts say that part of the sector needs to go bankrupt. Bob Moriarty: I can name five or six people who said, in the last three weeks, that we're at a bottom and it's safe to buy. My questions to them are:
Bottoming processes last a long time. Silver and gold were at a bottom from the middle of 2000 until the end of 2011. Any one date in that 18-month period was a bottom. I have a bunch of stocks that are up 50% since 1st December 2013. I think it's clear that we've had a major bottom. This is an incredible opportunity, and the longer people whine about how gold could go lower, the better it is. It's called climbing the wall of worry. TGR: You also are excited about copper. Why is that? Bob Moriarty: A lot of people think the copper price will go down with the rest of the base metals. I disagree. I've seen some incredible copper projects in the last six months – very high-grade projects that are reasonably priced to go into production. There are 10 or 20 companies that had projects of low-grade that were going to cost a lot of money. At least 6 to 10 are in the Middle Cauca belt in Colombia, which has enormous resources that, unfortunately, will always be uneconomic. TGR: Copper is the canary in the coal mine. If we're going to have a deflationary environment and economies are contracting, it would seem more logical for the price of copper to go down. What makes these particular copper projects good investments? Bob Moriarty: If copper goes down, they'll be more valuable. Because these are all high-grade projects, a lower copper price is good for them, because a lower price will drive the marginal producers out of business. The ideal situation is a company that will make money no matter what the cost of copper is. TGR: Bob, thanks for your time and your insights. | |
| A Blindford, a Dart, and a Winning Gold Miner Stock Posted: 14 Feb 2014 09:42 AM PST Really it's that simple after the December sell-off, says Bob Moriarty... BOB and BARB Moriarty brought 321gold.com to the internet more than 10 years ago, later adding 321energy.com to cover oil, natural gas, gasoline, coal, solar, wind and nuclear energy. Both sites feature articles, editorial opinions, pricing figures and updates on current events affecting both sectors. And according to Bob Moriarty – previously a Marine F-4B and O-1 pilot with more than 820 missions in Vietnam and holding 14 international aviation records – "fact that everyone hated gold in December is a good reason for rational people to love it now." Indeed, as he tells The Gold Report here, many good gold mining stocks now sell for "peanuts". All you need to pick a winner is a blindfold and a dart... The Gold Report: Bob, in the last few weeks, Argentina and Venezuela have devalued their currencies and the central banks in Turkey and South Africa hiked interest rates. The US Federal Reserve cut its monthly bond buying by another $10 billion. What do you make of all this happening in such a short timeframe? Bob Moriarty: In a way, I will take credit for having predicted it. The world is bankrupt, and not one government is talking about reducing expenses. They talk about austerity, but austerity means living within one's means. Governments refuse to do that. The Fed has three options: It can continue to taper, maintain the status quo or increase its bond buying. I think there's a good chance it will take that third option. We need a big crash first. TGR: What message does that send to the general market? Bob Moriarty: It says we've run out of bullets, head for your bunker. TGR: That can't be the message the Fed wants to send. Bob Moriarty: The message it intends to send is one thing; the message it actually sends is something else. Events in 2008 were only the opening act. The financial instability and the pressures in the markets are far worse today than they were in 2008. We had the chance to fix things back then, but Ben Bernanke, Alan Greenspan and Tim Geithner panicked and made the situation far worse. TGR: You sent me an article by James Gruber titled, "Welcome to Phase Three of the Global Financial Crisis". In it, he writes, "The system broke down in 2008 and again in Europe in 2011 and now in the emerging markets in 2013 and 2014. The market reaction to the latest events has been abrupt and violent, particularly in the currency world. In my experience, markets generally cope well when there is one crisis but when there are multiple spot fires like last week, most markets don't cope well." Is there more to come? Bob Moriarty: Of course things will keep getting worse until somebody understands that the real issue is debt. There are $694 trillion in derivatives. That is financial debt that can never be paid off. The world has been a giant casino for the last 20 years, and it's all coming to a head. TGR: How does devaluing their currencies help Argentina and Venezuela? Bob Moriarty: It doesn't. Every government in the world is spending money it doesn't have. The only solution is to stop spending money. Everyone refuses to do that because governments gain power by spending money. They will spend money until they've bankrupted all of their citizens. TGR: In Greece and in Spain, the European Union has implemented mandatory austerity programs to pay off their bonds. Shouldn't Greece and Spain be seeing economic improvement now that they've implemented those severe austerity programs? Bob Moriarty: There is no economic improvement. It's all smoke and mirrors. It's similar to climbing to the top of a 50-storey building and jumping off. Once you've jumped, it doesn't matter what you do on the drop down. You're going to hit the ground. They need to crash so they can rebuild on a solid foundation. Calling it austerity is using semantics to play with the citizenry. If one honest politician stood up and said, "We're spending more money than we have. We need to stop," that would put us on the way to curing the problem. But the politicians keep pretending there are other solutions. President Obama's charade in the State of the Union message was interesting. He was a Constitutional law professor before going into politics, yet in his speech he said the president of the US can unilaterally change the minimum wage. Did he ever read the Constitution? TGR: Apparently, he does have the ability to change it, but only in upcoming, new federal contracts. Bob Moriarty: There are three separate branches in the American political system: the executive, the legislative and the judicial. The president of the US does not make laws; he enforces them. His ability to do something is not the same thing as it being legal. All federal financial bills have to start in Congress. The president of the US simply cannot change the minimum wage. It's not part of his job. TGR: Wages earned by low-wage workers aren't increasing at the same rate as inflation. As a result, the minimum wage today doesn't give the same amount of purchasing power as it did when it was first implemented. Should the minimum wage be hitched to inflation or should it just be abolished? Bob Moriarty: If you make the minimum wage $10.10/hour, people who are gainfully employed at $8.50 have lost their jobs. All minimum wage laws do is eliminate jobs. If minimum wage laws worked and helped people, we should pay everybody $100/hour. But as soon as you say $100/hour, everybody says, nobody can afford that, which is true. There are people who cannot afford $10.10/hour. There are workers not worth $10/hour. In the EU, seven countries do not have minimum wage laws, 20 do. In the seven countries without minimum wage laws, the unemployment rate is just over 8%. In the 20 countries with minimum wage laws, the rate is over 11%. Minimum wage laws, no matter how well intentioned, cost an economy jobs. The economic stability of any country is based on the number of people in its middle class. There are rich and poor people in every society. That is as true as it is meaningless. The key to economic and political stability is the size of the middle class. The policies of George Bush, which have been compounded by Barack Obama, have destroyed the middle class. TGR: How have they done that? Bob Moriarty: First, people can't save money. If you save money at 0.25%, you're insane; inflation robs you of your real wealth. Second, taxes have increased. There are something like 48 separate taxes in Obamacare that have nothing to do with healthcare. The Affordable Care Act, Obamacare, is the nail in the coffin of the middle class. It is a giant payoff to the insurance companies. The insurance companies are protected under law. They are allowed to collude and do things no other industry can. As a result, the US has one of the least effective healthcare systems in the world and the most expensive. We need to burn the healthcare system down and start all over again. The insurance companies have the American public's throats in a death grip and they're killing us. TGR: Following on the general topic of insurance, you've talked about using precious metals as an insurance policy in a crisis. Do you mean the metal, the equities or a combination of both? Bob Moriarty: I see the physical metal as an insurance policy. Once investors have that policy in place, the equities are what they do with their investments. There are some wonderful companies selling for peanuts now that will do well no matter what happens – inflation or deflation. TGR: How much of a portfolio needs to be in precious metals to have a good underlying insurance policy? Bob Moriarty: That depends on the person and the amount of money available. Everybody has a different level. If my total worldly assets were $1000, I would put all of it into silver or gold coins. If I had $100,000, I'd probably put half of it into silver and gold. If I had $1 million, the percentage would be 5-10%. I was recommending metals even when gold was $268 per ounce and silver was $4 per ounce. All investments go up and down, and investors have to be prepared for that, but that doesn't change the fact that metals are the best insurance policy. TGR: I have my insurance policy; I have my gold and silver coins. Where should I look for gold mining and precious metals stocks? Bob Moriarty: You need two things: a blindfold and a dart. TGR: But you just said there were some really special companies selling for peanuts. Bob Moriarty: Yes, but the way to pick them is with a blindfold and a dart. TGR: Are some opportunities better than others, or do you believe the entire sector will improve? After all, some analysts say that part of the sector needs to go bankrupt. Bob Moriarty: I can name five or six people who said, in the last three weeks, that we're at a bottom and it's safe to buy. My questions to them are:
Bottoming processes last a long time. Silver and gold were at a bottom from the middle of 2000 until the end of 2011. Any one date in that 18-month period was a bottom. I have a bunch of stocks that are up 50% since 1st December 2013. I think it's clear that we've had a major bottom. This is an incredible opportunity, and the longer people whine about how gold could go lower, the better it is. It's called climbing the wall of worry. TGR: You also are excited about copper. Why is that? Bob Moriarty: A lot of people think the copper price will go down with the rest of the base metals. I disagree. I've seen some incredible copper projects in the last six months – very high-grade projects that are reasonably priced to go into production. There are 10 or 20 companies that had projects of low-grade that were going to cost a lot of money. At least 6 to 10 are in the Middle Cauca belt in Colombia, which has enormous resources that, unfortunately, will always be uneconomic. TGR: Copper is the canary in the coal mine. If we're going to have a deflationary environment and economies are contracting, it would seem more logical for the price of copper to go down. What makes these particular copper projects good investments? Bob Moriarty: If copper goes down, they'll be more valuable. Because these are all high-grade projects, a lower copper price is good for them, because a lower price will drive the marginal producers out of business. The ideal situation is a company that will make money no matter what the cost of copper is. TGR: Bob, thanks for your time and your insights. | |
| Posted: 14 Feb 2014 09:39 AM PST Gold stocks just surged to a major technical breakout, a very bullish omen. Investors are actually starting to redeploy capital in this battered sector, catapulting gold stocks into the early lead as 2014’s best performers! This year is shaping up to be the polar opposite of last year’s epic carnage, with gold stocks mean reverting back up to fundamentally-reasonable levels. The vast majority of the buying is still yet to come. Exiting last year, gold stocks were inarguably the most hated sector in all the stock markets. And it is easy to understand why. In a stupendous year when the benchmark S&P 500 stock index blasted 29.6% higher, the flagship HUI gold-stock index collapsed 55.5% lower! It is hard to imagine a greater performance gap, which led investors to flee as gold stocks were crushed with gold. It was a total disaster. | |
| China's offtake is forcing gold cartel to retreat, Kaye tells KWN Posted: 14 Feb 2014 09:37 AM PST 12:35p ET Friday, February 14, 2014 Dear Friend of GATA and Gold: The Western gold cartel is easing up a bit on price suppression because offtake of real metal into China has become too massive, Hong Kong-based fund manager William Kaye today tells King World News: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/2/14_Th... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT A Personal Touch in Buying Precious Metals If you've not secured your allocation of precious metals and numismatic coins, 2014 may be the last year to get them at affordable and undervalued prices. With huge amounts of gold leaving the West for Asia, the future availability of precious metals is very much in doubt. All Pro Gold has competitive pricing on all bullion and numismatic products -- and offers prompt delivery too. Long-time GATA supporters Fred Goldstein and Tim Murphy are glad to answer any questions or concerns about acquiring the monetary metals. All Pro Gold has an extensive electronic library of articles from the world's top market analysts. Learn more at www.allprogold.com or write to Fred and Tim at info@allprogold.com or telephone them at 1-855-377-4653. Join GATA here: 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: | |
| Posted: 14 Feb 2014 09:22 AM PST Dear RC, Jim advises that whilst he thinks the depletion of the Comex warehouse inventory will see the settlement move from physical gold to cash, there will be no default. In regards to physical gold storage, Jim advocates only fully allocated storage as pooled accounts are problematic. We are in the midst of what Jim... Read more » The post Jim’s Mailbox appeared first on Jim Sinclair's Mineset. | |
| Stocks Final Parabolic Bubble Spike - Great Inflation Scenerio 2014 Posted: 14 Feb 2014 09:18 AM PST Today another piece fell into place in my Great Inflation scenario that I'm expecting for 2014. Before I begin let me recap. My overarching driver for the Great Inflation scenario is that the dollar would have some kind of crisis, or semi-crisis late this year as it drops down into its major three year cycle low. All other stock and commodity movements will be driven by this impending currency crisis. | |
| Silver Confirms Gold’s Breakout Posted: 14 Feb 2014 08:49 AM PST As of yesterday, gold had advanced roughly $100 in 2014 for a gain of 8.3%. Silver was up $1.00 in the same time period for a smaller gain of around 5%. It is rare to see silver underperform gold, as it usually offers leverage in either direction to the movement of the gold price. |
Gold ran right up to the chart’s first ‘red resistance’ line today at 1320 and stuck to it, with the usual wobbling back and forth.
| You are subscribed to email updates from Save Your ASSets First To stop receiving these emails, you may unsubscribe now. | Email delivery powered by Google |
| Google Inc., 20 West Kinzie, Chicago IL USA 60610 | |
No comments:
Post a Comment