Gold World News Flash

---

• Central Bankers: Inflation is God’s Work
• The Gold/Silver Ratio: Gold And Silver Are Going Higher
• The Gold/Silver Ratio: Gold And Silver Are Going Higher
• Is This The Moment The Fed Decided To Go All In?
• Silver Surges As Bonds, Stocks, And The USD End Week Unchanged
• April Gold settles 1323, up $5 for the week ended February 21
• Man Who Ran First QE Owns Gold & Warns Of Coming Inflation
• Silver Does Not Have Much Resistance Between $21 and $26
• 5 Things To Ponder: Sex, Money And The Carry Trade
• Bundesbank Changes Gold Repatriation Schedule
• Big Gold Stocks Buying Opportunity
• The Counter-Intuitive Gold Play
• Gold's rise to $1,300 doesn't slow Chinese buying, Maguire tells KWN
• Gold and Silver Extend Their Price Rallies Amid Escalating Chinese Demand
• All Currencies Are an Inverse Pyramid Based on The Dollar
• Currency Wars the Great Destabilizer
• Gold Daily and Silver Weekly Charts - Coiling Into Option Expiration
• Gold Daily and Silver Weekly Charts - Coiling Into Option Expiration
• Silver Surges As Bonds, Stocks, And The USD End Week Unchanged
• Janet Yellen Wins Gold In Olympic Stimulus Spewing
• Koos Jansen more reliable on China than World Gold Council, Sprott says
• More 'taper' risks equity market plunge, Fed's former 'quantitative easer' says
• Maguire - China’s Gold Buying “Enormous” Right Now
• Man Who Executed QE1 For Fed Says Stocks May Collapse 30%
• Economic Doom on Ice
• Natural Gas Leaves Oil in the Dust
• Alasdair Macleod: Currency bubble may be next to pop
• Peter Boehringer: More evasions from the Bundesbank on Germany's gold in the U.S.
• Gold Price "Technicals Dominate" on Rally Above 200-dma In Face of Rising Dollar, Stocks, Rates
• 5 Tips for Investing in This Dirt-Cheap Sector
• Extreme Cold Weather Boosting Natural Gas Profits
• Gold, Silver, Acceleration and Money Velocity
• The Probability That the Gold & Silver Miners Bear Market is Over is Now High
• Bundesbank Must Intervene To Reassure German Gold Will Come Back
• Gold Bugs Don’t Fear Strength, Plenty More Upside Ahead for Gold Stocks
• India Tightens 80:20 Gold Import Rules
• India Tightens 80:20 Gold Import Rules
• Nothing happens in any major market now without China's assent, GATA secretary says
• Why didn't Handelsblatt ask the Bundesbank the right questions about gold?
• Shocking Trip Down The Rabbit Hole Of U.S. Secrets & Gold
• Alleged Gold & Silver Scams Abound
• Silver and Gold Prices Have Bottomed, Period.
• Silver and Gold Prices Have Bottomed, Period.
• GERALD CELENTE - The GLOBAL COLLAPSE is in FULL FORCE. Its Time the SHEEPLE WAKE UP
• This Is What Happened The Last Time Silver Went Up 14 Days In A Row
• Gold Trader: “We’re [Now] Starting A Final Parabolic Bubble Phase In The Stock Market”
• China Must Be Very Concerned About The US Dollar
• U.S. Dollar: Still King of Fiat Currencies
• Silver Does Not Have Much Resistance Between $21 and $26
• Gold Daily and Silver Weekly Charts - The Reivers

Central Bankers: Inflation is God’s Work Posted: 21 Feb 2014 03:50 PM PST Submitted by Doug French via the Ludwig von Mises Institute of Canada, Inflation is always somebody else’s fault. Ludwig von Mises called out finger pointing central bankers and politicians decades ago in his book, Economic Policy. “The most important thing to remember is that inflation is not an act of God, that inflation is not a catastrophe of the elements or a disease that comes like the plague. Inflation is a policy.” In the fall of 2007, Gideon Gono blamed his country’s inflation rate of 4,500 percent on “the differences that Zimbabwe has had with its former colonial master, the UK,” and added, “we are busy laying the foundations for a serious deceleration programme.” Deceleration? A year later inflation was 231 million percent. Money printing didn’t have anything to do with it according to the central banker. Droughts began to be more frequent in the 2000’s and Gono believed  ”there is a positive correlation between the drought and inflation.” Dry weather, he told New African magazine, has, “got a serious bearing on our inflation level.” In Gono’s dilluded mind,inflation was about the weather, lack of support from other nations, and political sanctions. He had nothing to do with the hyperinflation in his country. “No other [central-bank] governor has had to deal with the kind of inflation levels that I deal with,” Gono told Newsweek. “[The people at] my bank [are] at the cutting edge of the country.” These days in Argentina its not the weather and political sanctions causing prices to rise, its businesses engaging in commerce. President Cristina Fernández de Kirchner is urging her people to work “elbow-to-elbow” with her government to stop companies from looting the people with high prices. Two weeks ago the government devalued the peso by 20 percent but it is private businesses that are stealing from working people with price increases. Posters of retail executives have been plastered around Buenos Aires. For instance, Wal-Mart Argentina’s president Horacio Barbeito has his mug on a poster with the caption, “Get to know them, these are the people who steal your salary.” Kirchner’s cabinet chief Jorge Capitanich calls economists who point to government policies as inflation’s culprit “undercover agents.”  He implies that these economists are the tools of business. “Argentines should know that independent, objective economists don’t exist,” Capitanich claims. “I want to say emphatically that when unscrupulous businessmen raise prices it has absolutely nothing to do with macroeconomic variables.” In 2012 the president of Argentina’s central bank, Yale-educated Mercedes Marcó del Pont, said in an interview, “it is totally false to say that printing more money generates inflation, price increases are generated by other phenomena like supply and external sector’s behaviour.” So while its central bank prints, the Kirchner government has enlisted the citizenry to work undercover in the fight against rising prices. A free smartphone application is encouraging Argentines to be citizen-cops while they shop. The app is a bigger hit than “Candy Crush” and “Instagram.” President Kirchner wants “people to feel empowered when they shop.” And, they do. “You can go checking the prices,” marveled Analia Becherini, who learned of the app on Twitter. “You don’t even have to make any phone calls. If you want to file a complaint, you can do it online, in real time.” “Argentina’s government blames escalating inflation on speculators and greedy businesses,” reports Paul Byrne for the Associated Press, “and has pressured leading supermarket chains to keep selling more than 80 key products at fixed prices.” However, businesses aren’t eager to lose money selling goods. Fernando Aguirre told Chris Martenson that with price inflation running rampant, “Lots of stores don’t want to be selling stuff until they get updated prices. Suppliers holding on, waiting to see how things go, which is something that we are familiar with because that happened back in 2001 when everything went down as we know it did.” In his Peak Prosperity podcast with Aguirre, Martenson makes the ironic point that when governments print excessive amounts of money, goods disappear from store shelves. In a hyper-inflation the demand for money drops to zero as people buy whatever they can get their hands on. Inflation destroys the calculus of profit and loss, destroying business, and undoing the division of labor. Aguirre reinforced Martenson’s point. Describing shelves as “halfway empty,” in Argentina he said,  “The government is always trying to muscle its way through these kind of problems, just trying to force companies to stock back products and such, but they just keep holding on. For example, gas has gone up 12% these last few days. And there is really nothing they can do about it. If they don’t increase prices, companies just are not willing to sell. It is a pretty tricky situation to be in.” Tricky indeed.  “It would be a serious blunder to neglect the fact that inflation also generates forces which tend toward capital consumption,” Mises wrote in Human Action. “One of its consequences is that it falsifies economic calculation and accounting. It produces the phenomenon of illusory or apparent profits.” Inflation is also rampant at the other end of South America.  Venezuela inflations is clocking in at 56 percent. Comparing the two countries, Leonardo Vera, a Caracas-based economist told the FT, “Argentina still has some ammunition to fight the current situation, while Venezuela is running out of bullets.” Fast money growth has also led to shortages such as “newsprint to car parts and ceremonial wine to celebrate mass,” reports the FT. Venezuelan president Nicolás Maduro is using the government’s heavy hand to introduce a law capping company profits at 30 percent. Heavy prison sentences await anyone found hoarding, overcharging, or “destabilising the economy.”  Hundreds of inspectors have been deployed to enforce the mandates. The results will be predictable. “With every new control, the parallel, or black market, dollar will keep going up, and so will the price and scarcity of milk, oil, and toilet paper,” says Humberto García, an economist with the Central University of Venezuela. Don’t expect the printing to stop any time soon. Central bankers believe they are doing God’s work. “To ensure that my people survive, I had to print money,” Gideon Gono told Newsweek. “I found myself doing extraordinary things that aren’t in the textbooks. Then the IMF asked the U.S. to please print money. The whole world is now practicing what they have been saying I should not. I decided that God had been on my side and had come to vindicate me.” It seems disasters wrought by inflationary policies must be experienced again and again, as “Inflation is the true opium of the people,” Mises explained, “administered to them by anticapitalist governments.” The practice of central banking is the same around the world. The only difference is in degree. Before he destroyed the Zimbabwean dollar Gono looked to America for inspiration. “Look at the bridges across the many rivers in New York and elsewhere,” Gono told New African, “and the other infrastructure in the country that were built with high budget deficits.” The Zimbabwe, Argentina, and Venezuela inflations may seem to be something that happens to somebody else. But Mr. Aguirre makes a point when asked about 2001, when banks in Argentina, after a bank holiday, converted dollar accounts into the same number of pesos. A massive theft. “Those banks that did that are the same banks that are found all over the world,” Aguirre says. “They are not like strange South American, Argentinean banks–they are the same banks. If they are willing to steal from people in one place, don’t be surprised if they are willing to do it in other places as well.”

The Gold/Silver Ratio: Gold And Silver Are Going Higher Posted: 21 Feb 2014 03:15 PM PST The price of gold and silver will both hit new highs in 2014. The price of gold goes north of $2,000, and silver will quickly go over $50. When it does, it will get a little crazy.  – Eric Sprott, Sprott Investment Management - SilverDoctors.com A reader the other day was inquiring about the gold/silver ratio (GSR). The GSR is an interesting metric that converts the price of gold and silver into the number of ounces of silver it would take to buy one ounce of gold.  Over the entire course of history, that I know of, the GSR has been as low as 8, which was the fixed ratio used by the Roman Empire for exchanging gold and silver. Interestingly – at least to me – if you look at the GSR over the last 350 years, it held steady at around 15 until the middle/late 1800′s.  At that point in time it rose steadily as the gold standard was slowly eroded by United States.  President Lincoln was actually the first President to disconnect gold and silver as  the Constitutionally mandated currency when he allowed someone to use Government-issued bonds to settle a debt obligation (the action was later upheld by the Supreme Court under President Grant). At any rate, to cut to the chase, since the Federal Reserve was founded, the GSR has ranged from 15 to 100.   The low-end of the range usually correlates with bull market tops in gold/silver and vice versa with the high-end. Currently the GSR is 60 and I believe the recent movement in the GSR is signalling the possibility of a big move ahead for gold and an even bigger move for silver.  I have compiled my analysis in this article published by Seeking Alpha today:   The Gold/Silver Ratio: Forecasting A Big Move Higher For Silver I don't know if the next big move higher that I believe is coming will be the final stage of the precious metals bull market, but I do think that based on the extraordinary supply/demand fundamentals for gold that the next move will be big for gold and spectacular for silver.

The Gold/Silver Ratio: Gold And Silver Are Going Higher Posted: 21 Feb 2014 03:15 PM PST The price of gold and silver will both hit new highs in 2014. The price of gold goes north of $2,000, and silver will quickly go over $50. When it does, it will get a little crazy.  – Eric Sprott, Sprott Investment Management - SilverDoctors.com A reader the other day was inquiring about the gold/silver ratio (GSR). The GSR is an interesting metric that converts the price of gold and silver into the number of ounces of silver it would take to buy one ounce of gold.  Over the entire course of history, that I know of, the GSR has been as low as 8, which was the fixed ratio used by the Roman Empire for exchanging gold and silver. Interestingly – at least to me – if you look at the GSR over the last 350 years, it held steady at around 15 until the middle/late 1800′s.  At that point in time it rose steadily as the gold standard was slowly eroded by United States.  President Lincoln was actually the first President to disconnect gold and silver as  the Constitutionally mandated currency when he allowed someone to use Government-issued bonds to settle a debt obligation (the action was later upheld by the Supreme Court under President Grant). At any rate, to cut to the chase, since the Federal Reserve was founded, the GSR has ranged from 15 to 100.   The low-end of the range usually correlates with bull market tops in gold/silver and vice versa with the high-end. Currently the GSR is 60 and I believe the recent movement in the GSR is signalling the possibility of a big move ahead for gold and an even bigger move for silver.  I have compiled my analysis in this article published by Seeking Alpha today:   The Gold/Silver Ratio: Forecasting A Big Move Higher For Silver I don't know if the next big move higher that I believe is coming will be the final stage of the precious metals bull market, but I do think that based on the extraordinary supply/demand fundamentals for gold that the next move will be big for gold and spectacular for silver.

Is This The Moment The Fed Decided To Go All In? Posted: 21 Feb 2014 03:09 PM PST In December 2008, two brief conversations from Ms Yellen and Mr Bullard appear to have set the scene for both the scale and focus of the Fed's actions over the ensuing years... ironically it was Janet Yellen's fear of a "rising" labor force participation rate and Jim Bullard's rapid realization that the US was "moving to a Japanese-style deflationary, zero nominal interest rate, situation at an alarming pace." Topics that now are quickly ushered away as nonsense by the mainstream economist crystal-ball gazers...     Yellen sees a rising labor force participation rate, fears a rising unemplyment rate, and lays out the 3 areas on which to focus to fix that... YELLEN: Turning just very briefly to the labor market, the Beveridge curve chart that Stephanie presented during her briefing suggests that we have seen an unusually large increase in the unemployment rate recently in comparison with the decline in job openings, at least in the JOLTS data. I think one interpretation might be that the unemployment rate has risen in part because we have had an unusual rise in labor force participation during this recession.   Labor force participation has been higher than would be expected, particularly for three demographic groups: young adults, married women, and older workers nearing retirement. Analysis by my staff estimates that this rise in participation could reflect behavioral responses to unusual credit constraints and wealth declines.   Specifically, young adults aged 20 to 24 years appear to be entering the labor force in unusual numbers, and that might reflect diminished access to student loans.   Similarly, more married women are entering the labor force, and that's a possible reflection of diminished access to home equity and credit card loans.   Finally, an unusually large number of older workers are in the labor market, and that may reflect the negative wealth shock associated with the collapse of housing values and the plummeting stock market.   All in all, I expect the anomalous increase in labor force participation to put continued upward pressure on the unemployment rate.   And what happened - the Fed/Govt juiced student loans, piled liquidity into car loans, and smashed home and stock prices up... and the labor force participation rate collapsed and so did jobs...   Then Bullard comes out all "shock-and-awe"... BULLARD: In sum, I think we are moving to a Japanese-style deflationary, zero nominal interest rate, situation at an alarming pace.   To stay in the game and control expectations, we need a Volcker-like transformation, something like—although the situation is different—the '79 announcement, which knocked private-sector priors off the idea that they should trigger all reactions to announcements on nominal interest rates.   You need a dramatic move that emphasizes this new reality. Continued focus on the federal funds rate at this point would not face that reality. Now, of course, the Labor force participation rate is collapsing, there are no jobs created by the energizing of those credit lines and the Fed is desperate to dismiss any perspective that we are turning Japanese.

Silver Surges As Bonds, Stocks, And The USD End Week Unchanged Posted: 21 Feb 2014 02:35 PM PST from ZeroHedge: While The Russell 2000 briefly regained positive territory for 2014 (up 1.5% on the week), the Dow, S&P, and Trannies ended the shortened and low volume week practically unchanged (and the Dow -2.6% YTD). Treasury yields oscillated as bad-news-good-news played out but ended the week practcically unchanged (10Y -1bps, 5Y +1bps). The USD drifted lower today to end the week very modestly positive (+0.1%) as EUR strangeth dominated JPY and CAD weakness). VIX went higher all week (admittedly OPEX-impacted) as underlying stocks remained bid. Credit markets ended the week wider than they opened on Tuesday (despite equity strength). Depsite the USD, commodities rose on the week with Silver and WTI crude up almost 2% and gold up 0.5%. For an options-expiration day, today’s volume was very weak. And 2014′s best performing S&P 500 sectors… Healthcare and Utilities. Read More @ ZeroHedge.com

April Gold settles 1323, up $5 for the week ended February 21 Posted: 21 Feb 2014 02:26 PM PST Gold futures snapped a two-day loss to end higher on Friday, as investors sought the safe haven appeal of the metal after some disappointing home sales data out of the U.S. and with the ongoing violence in Ukraine. For the week, gold gained about 0.4 percent. The continued violence and widespread protests against President Viktor Yanukovych has culminated in an unconditional peace pact to end the chaos in Kiev and other regions of Ukraine. With the frenzied nation almost on the verge of a civil war, President Yanukovych and opposition leaders agreed to a deal which could end the political crisis, with the likely release of former Prime Minister Yulia Tymoshenko from jail. In economic news, the National Association of Realtors on Friday showed existing home sales in January dropped more than expected, providing further evidence of weakness in the housing market. Home buyers were constrained by tight credit, limited inventory, higher prices and higher mortgage interest rates. Gold is up about 10 percent in 2014 because it is valued as a safe haven amid signs the global economy has hit a rough patch. Also physical buying has been strong especially out of China, as it was reported Thursday that China bought 85 tons of Gold this week which almost represented half of Switzerland's total Gold exports. It has been reported that China has taken over India as the world's top consumer of Gold. It is my view that despite a hawkish tone from Fed officials concerning future tapering, this market seems poised to edge higher. I wrote earlier in the week that investors should watch profit taking once gold hit the 10 percent threshold for the year at 1326.3. Well that is exactly what happened, with gold selling of $20.00. However Gold was able to hold and settle above some important moving averages particularly the 200 day moving average at 1308.0. A level worth keeping an eye on to the upside is up at 1351.4 basis April futures. That represents a 38 percent Fibonacci retracement from the double bottom down at 1182 made in late December 2013. The U.S. Economic calendar is light next week, and economists said the trend of the wintry weather possibly affecting data results will likely continue. New home sales data are slated for Wednesday with Durable Goods expected Thursday and the second estimate of fourth quarter GDP for a Friday release. Technical's for next week come in as follows for both April Gold and March Silver. For April Gold, support lies down at 1309.6 and below there at 1295.7. Resistance is up 1334.9 and above there at 1346.3. For March Silver, support is down at 21.40 and below there at 21.02. Resistance is up at 22.07 and 22.36. Daily Swing #s GCJ14 February 24th, 2014 Resistance#2- 1332.7 Resistance#1- 1328.1 Pivot# – 1322.0 Support#1- 1317.4 Support#2- 1311.3   Author: Sean Lusk | Director Commercial Hedging Division | Walsh Trading | www.walshtrading.com

Man Who Ran First QE Owns Gold & Warns Of Coming Inflation Posted: 21 Feb 2014 02:17 PM PST Today the man who ran the first QE program for the Fed told King World News that he owns gold and warned of coming inflation. This was the former Fed member who also set up the Fed's massive trading room, and who is the former Managing Director at Morgan Stanley, Andrew Huszar. Below is what Huszard had to say in Part II of this remarkable series of interviews. This posting includes an audio/video/photo media file: Download Now

Silver Does Not Have Much Resistance Between $21 and $26 Posted: 21 Feb 2014 02:10 PM PST from Gold Silver Worlds: In this week's online radio appearances, David Morgan explains his latest take on precious metals in 2014 and the very short term silver price. He touches on more fundamental questions like the dollar world reserve currency and the financial system. We highlighted several quotes in this article. David Morgan his 2014 outlook on precious metals: This year there has a lot of fresh buying in the precious metals and especially in the miners. Silver is up 10% while some miners are up 50% or even 100%. The precious metals sector is the highest flying one since the start of this year. This has caught several people by surprise, but not us (The Morgan Report) as we expected this would happen in 2014. Silver's near term price action Read More @ GoldSilverWorlds.com

5 Things To Ponder: Sex, Money And The Carry Trade Posted: 21 Feb 2014 02:09 PM PST Submitted by Lance Roberts of STA Wealth Management, In last week's newsletter, I discussed the return of "Bad News Is Good News" as the driver of the markets.  This week saw the continuation of that theme as one economic report after another came in far below expectations.  The question remains, and something I discussed this week on The Willis Report, is whether it is actually all just a function of the weather?  Of course, there is something inherently wrong with driving asset prices higher based on hopes that a weaker economy will keep the Fed's "liquidity fix" flowing to drug addicted Wall Street traders.  Under that theory, we should be rooting for an outright "depression" to double our portfolio values.  But, when put into that context, it suddenly doesn't make much sense.  Yet that is the world in which we live in...for now. Therefore, as we wind down the week on this "options expiry" Friday, here is a list of things to think about over the weekend.  1) The Economics Of Sex by The Austin Institute This first bit is really just something I found interesting.  The essential mission of the Austin Institute is the dissemination of both thought-provoking and rigorous academic research on family, sexuality, social structures and human relationships.  The "economics of sex" is interesting from the standpoint that the value of "sex" has fallen precipitously over the last few decades due to scientific advances and the decline of the "moral" fabric in society.  What would it take to cause that "price" to once again rise?   2) Hayek On Keynes:  "Economics Was A Sideline For Him" via Zero Hedge "Keynes will be remembered as "a man with a great many ideas that knew very little economics," Friedrich Hayek notes in this brief interview and when challenged on his 'parochial' knowledge of economic history he was "not sheepish in the least... he was much too self-assured." Hayek's perspective casts Keynes in a very different light than his fan's apostolic adoration might suggest, "he was utterly contemptuous of anything that had been done before." While Hayek describes Keynes as one of the most intelligent people he had known, he perhaps sums up the man's work in this brief phrase - "economics was just a side-line for him." As we note below, many describe Keynesian policy as 'dumb', however a more appropriate word would be 'foolish'."   3) Harry Dent's Big Buy Signal via Above The Market In the late 1980s, Dent forecast that the Japanese economy, then the darling of the world, would soon enter a slowdown that would last more than a decade. In the early 1990s, he predicted that the DOW would reach 10,000. Both of these predictions were met with much skepticism, and yet both eventually came to pass.  In late 2006, he estimated the Dow would reach 16,000 - 18,000 and the NASDAQ 3,000 - 4,000. In his 2011 book, he suggests that consumer spending will begin to plummet in 2012 with the Dow bottoming out somewhere between 3,000 and 5,600 in 2014.  After hitting bottom, stocks will experience a mini-rally in 2015-2017 before falling into a final bottom during the 2019-2023 period, when the 45-50 age group troughs because the U.S. birth rate reached its own low in 1973.  Robert Seawright takes Dent to task with a recent missive.   "Now marketing himself as a “rogue economist,” Harry Dent is forecasting “gold down to $750 an ounce, housing down 35%, oil down to $10 a barrel, the Dow down to 6,000, [and] a war between inflation and deflation” this year. The headline is indeed shocking:   If Only HALF of Harry’s Forecasts Come to Pass, the American Life We Know Will Disappear for Good!" However, as a long term investor, I think we need to set aside "predictions" for a moment.  The question we should be thinking about is whether Dent's work on demographics has merit...or not?   4) Understanding The Carry Trade By Joseph Stuber There is much debate over the Fed's ongoing "quantitative easing" programs and whether or not there is an actual effect on asset prices.  Joseph did a good job at explaining how the Fed's programs creates the "carry trade" that lifts asset prices.  This also explains why the markets are so fixated on the Fed's "tapering" commentary. "The reason it matters to investors is that stock and bond prices have benefited greatly from QE and deficit spending. Not only has QE expanded M2, but a large portion of that M2 has found its way directly into stocks, pushing equity valuations higher and higher. The reason QE hasn't produced significant economic growth is in part the fact that the money created on the front-end of this process has been invested in risk assets rather than flowing into the economy to stimulate GDP growth.   Here is a simple graphic that demonstrates this dynamic:"   5) QE Is Here To Stay via Pragmatic Capitalist I have discussed previously that the U.S. is likely now caught in a "liquidity trap."  Cullen's comments regarding "QE-4EVA" is suggestive of that view being correct. "Why do I think this?  Well, first of all, the Fed’s balance sheet is going to remain large for a long time because the Fed isn’t going to shrink its balance sheet by selling assets.  So the effects of QE are here to stay.  But more importantly, I think the economy is operating at a muddle through pace for reasons I’ve discussed previously and that means that the Fed will maintain an accommodative interest rate structure for some time.   The interesting thing about this potential world is that it means QE is the new policy tool of choice.  In other words, QE could potentially replace interest rate policy as the primary policy variable.   QE is probably here to stay in some form for the foreseeable future.  In fact, it could become THE policy tool of choice in future business cycles…" As always, I hope that you will have an enjoyable weekend.

Bundesbank Changes Gold Repatriation Schedule Posted: 21 Feb 2014 02:00 PM PST “Only labour can create wealth – gold is condensed labour” from In Gold We Trust: One of the initiators of the German public campaign "Repatriate our Gold" is Peter Boehringer of "German Precious Metal Society" (est 2006). After lengthy efforts together with partner the "European Taxpayers Association", the team finally, in January 2013, brought about Bundesbank´s decision to repatriate 300 tons of gold from the US and 374 tons from France  by end-2020. Because asking your gold back from the US being quite sensitive, the repatriation would be spread over an eight year period. This was the original allocation schedule for the German official gold holdings, 3390.6 tons, set up in January 2013: Read More @ InGoldWeTrust.com

Big Gold Stocks Buying Opportunity Posted: 21 Feb 2014 01:48 PM PST Gold stocks have been on fire this year, blasting higher to 2014’s pole position of best-performing sector.  And this powerful rally’s internals are looking as good as its headline gains.  The recent months’ gold-stock buying has been on big volume, with large capital inflows.  This is very bullish behavior revealing a sea change in sentiment and strong conviction among returning gold-stock investors and speculators.

The Counter-Intuitive Gold Play Posted: 21 Feb 2014 01:38 PM PST Gold has so far enjoyed a terrific start to the New Year, most recently closing at its highest level late October 2013. It has even succeeded in closing above its psychologically significant 200-day moving average for the first time in over a year. In summary, gold futures have risen over 12% through Feb. 18, reversing its biggest annual drop in over three decades. It also hit a three-month high on Tuesday. Holdings in ETFs backed by bullion increased by 3.2 metric tons last week - the greatest amount since December 2012 - after slumping 869.1 tons in 2013, when prices were down 28%.

Gold's rise to $1,300 doesn't slow Chinese buying, Maguire tells KWN Posted: 21 Feb 2014 01:26 PM PST 4:24p ET Friday, February 21, 2014 Dear Friend of GATA and Gold: London metals trader Andrew Maguire today tells King World News that Chinese gold buying has only increased as the gold price has broken back above $1,300: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/2/21_Ma... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT Buy metals at GoldMoney and enjoy international storage GoldMoney was established in 2001 by James and Geoff Turk and is safeguarding more than $1.7 billion in metals and currencies. Buy gold, silver, platinum, and palladium from GoldMoney over the Internet and store them in vaults in Canada, Hong Kong, Singapore, Switzerland, and the United Kingdom, ­taking advantage of GoldMoney's low storage rates, among the most competitive in the industry. GoldMoney also offers delivery of 100-gram and 1-kilogram gold bars and 1-kilogram silver bars. To learn more, please visit: http://www.goldmoney.com/?gmrefcode=gata Join GATA here: Mines and Money Hong Kong Hong Kong Convention and Exhibition Centre Monday-Friday, March 24-28, 2014 Hong Kong Special Administrative Region, China 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: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT How to profit with silver -- and which stocks to buy now Future Money Trends is offering a special 16-page silver report with 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...

Gold and Silver Extend Their Price Rallies Amid Escalating Chinese Demand Posted: 21 Feb 2014 01:26 PM PST This week has seen precious metals prices rise strongly, with the bears caught on the hop. The chart below shows gold which at the time of writing has been consolidating under overhead supply in the $1330-50 level.

All Currencies Are an Inverse Pyramid Based on The Dollar Posted: 21 Feb 2014 01:22 PM PST When US money supply measured by M2 stood at $11 trillion in December 2013, I calculate that total broad money of the next largest 50 countries ranked by GDP amounted to the equivalent of a further US$67 trillion at current exchange rates. And that's only on-balance sheet: we must add in global shadow banking, estimated by the Financial Stability Board to have been an extra $67 trillion in 2011, probably about $75 trillion today, given its recent rapid growth in China. So when we look at US broad money supply, we should be aware there is a further mountain of money thirteen times as big ultimately based on the dollar.

Currency Wars the Great Destabilizer Posted: 21 Feb 2014 01:20 PM PST              Dr. Karl Schiller, West Germany’s Economics Minister between 1966 and 1972, pithily pronounced that: “Stability is not everything, but without stability, everything is nothing.” I agree. In the economic sphere, instability is usually a “bad”, not a “good”.              The world’s great destabilizer is the United States. How could this be? In the post-World War II era, the world has been on a U.S. dollar standard. Accordingly, the U.S. Federal Reserve is the de facto central banker for the world.

Gold Daily and Silver Weekly Charts - Coiling Into Option Expiration Posted: 21 Feb 2014 01:18 PM PST

Gold Daily and Silver Weekly Charts - Coiling Into Option Expiration Posted: 21 Feb 2014 01:18 PM PST

Silver Surges As Bonds, Stocks, And The USD End Week Unchanged Posted: 21 Feb 2014 01:06 PM PST While The Russell 2000 briefly regained positive territory for 2014 (up 1.5% on the week), the Dow, S&P, and Trannies ended the shortened and low volume week practically unchanged (and the Dow -2.6% YTD). Treasury yields oscillated as bad-news-good-news played out but ended the week practcically unchanged (10Y -1bps, 5Y +1bps). The USD drifted lower today to end the week very modestly positive (+0.1%) as EUR strangeth dominated JPY and CAD weakness). VIX went higher all week (admittedly OPEX-impacted) as underlying stocks remained bid. Credit markets ended the week wider than they opened on Tuesday (despite equity strength). Depsite the USD, commodities rose on the week with Silver and WTI crude up almost 2% and gold up 0.5%. For an options-expiration day, today's volume was very weak. And 2014's best performing S&P 500 sectors... Healthcare and Utilities.   While the Nasdaq ands Russell high beta muppets got the attention, the "big" indices ended the week practically unchanged....   Despite the OPEX pinners desperate to ramp stocks into the open via USDJPY (which failed)...   Leaving the Russell and Nasdaq green in 2014 and the rest lagging notably...   With equities being led in 2014 by Healthcare and Utilities...!!!   VIX rose all week...   Credit ended wider than it opened...     The USD pulled back to almost unchanged on the week (with plenty of divergence on the week)...   And US Treasury yields also rallied back to unchanged on the week...not ethat bonds started rally almost perfectly at 830ET   But gold, silver, and WTI crude rallied notably on the week...     Charts: Bloomberg Bonus Chart: Of course, equity markets are all about discounting the fun-durr-mentals... (h/t @Not_Jim_Cramer)   Bonus Bonus Chart: GroupOff...-33% from AH Highs...

Janet Yellen Wins Gold In Olympic Stimulus Spewing Posted: 21 Feb 2014 12:59 PM PST I remember, because it is seared into my memory, every detail of the day when I watched, in total disbelief and screaming outrage, as Janet Yellen testified in front of Congress. She is, of course, the new head honcho at the evil Federal Reserve, taking over after the spectacular failure of her predecessor, the laughably benighted Ben Bernanke, and she said, frying precious neurons of my already-depleted brain ("zzzt!") the words, "Inflation remains below our longer-term objective," which, as it turns out, she means 2 percent inflation in prices!! If you do not understand the significance of the double exclamation points, then you are NOT a Junior Mogambo Ranger (JMR), and thus you are ignorant of the Austrian school of economics, and also thus you do not know that 2 percent inflation is something terrible, as the historical cutoff for inflation has always been 3 percent. Above 3 percent inflation rate, calamity awaits, which kind of rhymes, so you know it must be true, in case the entire historical record of the world is not enough to convince you that anybody deliberately pursuing the pernicious poison of price inflation is either evil or a moron, and being driven by the absolute desperation resulting from behaving like monetary idiots for the last half-century is no excuse. Of course, Janet Yellen has long been a proponent of inflation-targeting, and that is one of the reasons why I am so dismissive of her bizarre, mutant intelligence, which seems to be centered around spewing that whole Keynesian "stimulus spending" load of crapola, even though Keynes has been discredited so many times, for so long, that it seems impossible that anyone would still be a Keynesian economist. So, why is she like that? Being that the Winter Olympics are being held right now, perhaps that is why I thought of "stimulus spewing" as an Olympic sport, which brings up the question "How is stimulus spewing scored, and what are the rules of stimulus spewing?" …higher costs are not being offset with increases in income, as "median income has only risen 1% each year…" The question seems stupid, and it is, but, then again, why not? Merely have Olympic stimulus spewing scored by how much price inflation per 4-year Olympic cycle that the monetary inflation causes! Alas, Janet Yellen's apparent quest for an Olympic gold medal STILL doesn't explain why she is so deliberately, so shamelessly, so horrifically evil that she is willing to punish poor people and the middle class with higher and higher prices, year after year after year! Evil, I tells ya! Laughably, and perhaps ironically (although I am not sure what "ironically" means anymore, if I ever did), she actually said this "I want inflation because I hate you and your nasty children" venom almost literally at the same time as she was proudly reiterating the "missions" of the Federal Reserve, the first of which is, of course, "price stability," and is obviously defined as "when inflation in prices is zero." Now, you may not know it, but you are talking to a guy who happens to know for a fact — a fact! — that stability means "zero change," and I know it for a fact — a fact! In fact, the same fact!– because of a very embarrassing Quarterly Employee Review one time where my supervisor wrote that while my attendance and attitude had "Deteriorated markedly," she also noted that "Job performance, such as it is, is stable," which meant, as I subsequently learned in the course of the evaluation, was, "No change. You're still the worst employee I have." Leaving aside, for the moment, the crippling damage done to my fragile ego by such a hasty judgment by some boss whom I rarely even saw because I was usually goofing off somewhere else every time she came looking for me, probably to whine about some deadline I missed, or some stupid report I forgot about writing, or about some lowlife, deranged, lying piece of crap client complaining about something I did, or did not, do, but note that — ergo! — and for the record, "stability = zero change"! Ms. Yellen, seeking 2 percent inflation, is saying that she does not understand this concept, but compensates by hating your guts and your entire family. And if you watched any of her testimony, you could tell by the nervous way she acted that, if she could, she would gladly come over to your house and kill you and your whole family, including puppies and kittens and baby bunnies, and steal your house and assets outright, instead of having to go through the hassle of defending a disastrous monetary policy, although the Federal Reserve has been such a disastrous failure for the last half-century that (pausing for breath) We're Freaking Doomed (WFD) no matter WHAT she does. Instead, she is going to make sure that all your assets (including all your cash, your retirement plan, your house and all your investments), which are denominated in dollars, LOSE at least 2 percent of their buying power Every Freaking Year (EFY). Inflation in prices is already so high that the minimum wage is being increased again out of "necessity,", which will make the problem worse: Paying higher wages means the employers are going to raise prices to restore their profit margins, or replace workers with technology and robots, or both. So, at the end of the day, a few employees get more money, a few employees lose their jobs, but everybody pays higher prices. And it is not only insane monetary inflation that is causing price inflation, but the old supply/demand dynamic is being upset mightily, too! Michael Snyder at theecohomiccollapseblog.com asks, "Did you know that the U.S. state that produces the most vegetables is going through the worst drought it has ever experienced, and that the size of the total U.S. cattle herd is now the smallest that it has been since 1951?" Ever! Worst ever! Going back to the late 19th century! And there is a lot of evidence, such as in tree rings, that California has been extraordinarily wet for most of the 20th century, and that, statistically at least, it is possible that the California drought could continue for another 200 years! What is THAT going to do to prices? Hahaha! I'm surprised you asked! Already, CBSNews.com, reports that "While the government says prices are up 6.4 percent since 2011," which is where I insert that the government is a lying, cheating, manipulating piece of low-IQ crap and we can't believe anything they say. Having said that and feeling better for it, we continue where we left off, with "chicken is up 18.4 percent, ground beef is up 16.8 percent and bacon has skyrocketed up 22.8 percent," which jibes pretty well with shadowstat.com calculating that inflation in prices is, and has been, running about 8 or 9 percent. As reported by breitbart.com, higher costs are not being offset with increases in income, as "median income has only risen 1% each year, while the cost of college tuition has climbed 6% to 8% every year for at least forty years." Forty years! And remember Olympic stimulus spewing, the new sport so memorably introduced above? Well, another way to score stimulus spewing is the results of price inflation (particularly vis a vis stagnating incomes) causing the number of adults under the age of 35 that live at home, with his or her parents, instead of being out living on their own, throwing wild parties lasting the whole weekend until I finally puke and crash on their sofa. It's now 29 percent, so they say. Almost one in three! In other depressing news, rising prices reduces disposable income, and part of the effect is that it now takes as long for car dealers to sell a new car as it took in 2009, which was the year after 2008, which is when bubbly things went so badly from decades of Federal Reserve mismanagement that the Federal Reserve completely lost its mind and began quantitative easing on the scale of trillions of dollars per year, on the insane Keynesian theory that two wrongs (creating the original debt and the increase in the money supply to keep it afloat) make a right. And homebuilding permits and applications have collapsed. And total debt (government and private) are all at new record highs. And the idiocy of Obamacare continues destroying a sixth of GDP. In summary, if ever there was a Sign From The Mogambo (SFTM) to buy gold, silver and oil, the red-lining of my Mogambo Fear And Paranoid Meter (MFAPM) could very well be it. If everything collapses tomorrow, or even this year, then we'll know for sure. Otherwise it's a reliable leading indicator. So, obviously, with iron-clad, indisputable proof like this, you should be buying gold, silver and oil stocks in some desperate, clutching-at-straws, frightened, feral frenzy, a path so clearly indicated by the reference to the infallible MFAPM in the very preceding paragraph. And with that kind of proximity to the best advice you ever got, you can hardly say that you forgot, which kind of rhymes too, again proving it's all so, so true! Whee! And again I say "Whee!" And yet thrice do I say "Whee!" as in "Whee! This investing stuff is easy!" Regards, The Mogambo Guru for The Daily Reckoning Ed. Note: With every appearance The Mogambo Guru makes in the pages of The Daily Reckoning, in addition to his inimitable style, he stresses the importance of knowing what to do as government stupidity threatens to destroy your financial stability – not to mention the financial stability of the entire US economy. And since he refuses to keep quiet – no matter how much people tell him to “pipe down” - The Daily Reckoning will continue to feature him, in hopes that someone will hear his Mighty Mogambo Message (MMM) and use it as a sign to protect themselves from the economic collapse that threatens us all. Sign up for the FREE Daily Reckoning email edition, to read the Mogambo’s warnings before almost anyone else.

Koos Jansen more reliable on China than World Gold Council, Sprott says Posted: 21 Feb 2014 12:32 PM PST 3:30p ET Friday, February 21, 2014 Dear Friend of GATA and Gold: Gold researcher and GATA consultant Koos Jansen's estimates of Chinese gold demand, posted at his Internet site, In Gold We Trust (http://www.ingoldwetrust.ch/), are far more accurate than the World Gold Council's, which miss a lot of gold going into China, Sprott Asset Management CEO Eric Sprott says today. Sprott adds that some investment bank recommendations against gold don't match what the banks are doing for their own accounts. Sprott's comments come in the weekly gold market review at Sprott Money News, an eight-minute interview that can be heard here: http://www.sprottmoney.com/sprott-money-weekly-wrap-up CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT How to profit with silver -- and which stocks to buy now Future Money Trends is offering a special 16-page silver report with profiles of nine companies and technical analysis of their stock performance. Six of the companies have market capitalizations of less than $800 million and one company has a market cap of only $30 million. The most exciting of these companies will begin production in a few weeks and has a market cap of just $150 million. Half of all proceeds from the sale of this report will be donated to the Gold Anti-Trust Action Committee to support its efforts exposing manipulation and fraud in the gold and silver markets. To learn about this report, please visit: http://www.futuremoneytrends.com/index.php?option=com_content&id=376&tmp... Join GATA here: Mines and Money Hong Kong Hong Kong Convention and Exhibition Centre Monday-Friday, March 24-28, 2014 Hong Kong Special Administrative Region, China 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: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT Buy metals at GoldMoney and enjoy international storage GoldMoney was established in 2001 by James and Geoff Turk and is safeguarding more than $1.7 billion in metals and currencies. Buy gold, silver, platinum, and palladium from GoldMoney over the Internet and store them in vaults in Canada, Hong Kong, Singapore, Switzerland, and the United Kingdom, ­taking advantage of GoldMoney's low storage rates, among the most competitive in the industry. GoldMoney also offers delivery of 100-gram and 1-kilogram gold bars and 1-kilogram silver bars. To learn more, please visit: http://www.goldmoney.com/?gmrefcode=gata

More 'taper' risks equity market plunge, Fed's former 'quantitative easer' says Posted: 21 Feb 2014 12:22 PM PST 3:22p ET Friday, February 21, 2014 Dear Friend of GATA and Gold: More reductions in bond purchases by the U.S. Federal Reserve and other central banks risk big declines in world equity markets, King World News is told today by Andrew Huszar, former mortgage security purchase manager for the Federal Reserve Bank of New York, who calls himself a regretful "quantitative easer." (See http://www.gata.org/node/13229.) An excerpt from the interview is posted at the King World News blog here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/2/21_Ma... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. 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 Hong Kong Convention and Exhibition Centre Monday-Friday, March 24-28, 2014 Hong Kong Special Administrative Region, China 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: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT Jim Sinclair plans seminars in Los Angeles and San Diego 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/

Maguire - China’s Gold Buying “Enormous” Right Now Posted: 21 Feb 2014 12:03 PM PST With gold getting a weekly close above the important $1,320 level, today London metals trader Andrew Maguire told King World News that despite rumors to the contrary, China's gold buying is "enormous" right now. Below is what Maguire had to say in Part I of a timely and powerful series of interviews that will be released today. This posting includes an audio/video/photo media file: Download Now

Man Who Executed QE1 For Fed Says Stocks May Collapse 30% Posted: 21 Feb 2014 10:00 AM PST In the aftermath of the recent chaos and market turmoil in emerging markets, today King World News spoke with the man the Fed called on to execute QE1 and who also set up the Fed's massive trading room, former Fed member and former Managing Director at Morgan Stanley, Andrew Huszar. What he had to say will stun KWN readers around the world. He warned stocks may collapse 30% or more in a matter of months if the Fed continues on the current course, and he also said that the Fed is now running the largest hedge fund in the world and it may end in disaster. Below is what Huszard had to say in Part I of this remarkable interview. This posting includes an audio/video/photo media file: Download Now

Economic Doom on Ice Posted: 21 Feb 2014 09:25 AM PST The financial world is plodding along like a drunken sailor avoiding debt collectors by keeping no cash in his wallet. It’s not the kind of calm that’s going to last or end well. But the storm will have to wait until after the Olympics. What a game! We’ve never watched ice hockey closely before. But watching Russia and the U.S. play a contact sport is bound to be fun. Just before the end of the third period, the Russian team scored to take the lead 3-2. But the goal was disallowed because the pin holding the goal had stretched, leaving the net imperfectly square. It had no impact on the quality of the shot, but the refs didn’t seem to care. The game went to penalty shootout. The Americans scored the first shot, but missed the next two. The Russians missed their first two and then scored the third. So it went to sudden death penalties. (By this point we were late for an appointment, but couldn’t leave the clueless British commentator to it.) T. J. Oshie from St Louis was designated to take all the Americans’ sudden death penalties. We think all this digital warfare is overhyped. Globalization has the upper hand. About ten minutes later, Oshie and the crème of the Russian team were still matching each other shot by shot. Each time the Russian scored, Oshie scored. Each time the Russian missed, Oshie missed. And so it went on for about eight penalties. Eventually Oshie got one up and the game was over. The crowd didn’t like it. Russian President Vladimir Putin didn’t look happy. The referee who disallowed the Russian’s goal is unlikely to make it out of Russia alive. The good news is that NSA leaker Edward Snowden received an extension to his Russian visa. At least we suspect he will shortly. Snowden’s files continue to bring up embarrassing surprises. The German media is reporting that their intelligence community, banks and government were all subject to a digital attack out of China. But what is China doing attacking the Germans? And isn’t it odd that we find out about it from leaked U.S. intelligence files? Of course, economic attacks are an age old strategy. But the digital age makes things far more interesting. America managed to get Iranian nuclear equipment to go haywire using a computer virus. That’s much cooler than the medieval technique of lobbing a dead cow over the city walls to try and get disease to spread and the city to surrender. We think all this digital warfare is overhyped. Globalization has the upper hand. And in the end a serious digital attack is an act of war. The Cold War stayed cold for a reason. Not that this means we’re off the hook. Governments are much better at screwing up their own economies than other countries’. The American virus which messed with Iran’s nuclear production also ended up infecting the networks of western oil producing companies. But these aren’t the kind of shenanigans that will cause serious global problems. The next big crisis is going to be far more original. The French multinational banking and financial services company, Societe Generale, staged an economic wargame which modeled an economic slowdown in China. The conclusion was that the U.S. dollar would rise, world economic growth would stumble and commodity producing nations would be hit hard. Strangely enough, SocGen isn’t worried about the Chinese banking system and its systemic risk. Foreigners only have a small exposure to China. Just as the subprime housing crisis in the U.S. was just a small problem. Daily Reckoning Australia editor Greg Canavan is worried about the Chinese banking system in particular. It’s out of control and fraying at the edges. The shadow banks are defaulting and struggling already. But why does debt play such an important role in economic crises? The answer is that it’s the government’s number one economic tool. They see debt as a way of managing economic growth. By fiddling with the price of debt — interest rates — economists can manipulate GDP. And apparently they can do it without fear or consequence. Over at the IMF, researchers have come up with an absolutely priceless piece of research proving it. We have to quote the abstract because it’s so beautifully ignorant of any sense of reality. “Using a novel empirical approach and an extensive dataset developed by the Fiscal Affairs Department of the IMF, we find no evidence of any particular debt threshold above which medium-term growth prospects are dramatically compromised. Furthermore, we find the debt trajectory can be as important as the debt level in understanding future growth prospects, since countries with high but declining debt appear to grow equally as fast as countries with lower debt. Notwithstanding this, we find some evidence that higher debt is associated with a higher degree of output volatility.” In other words, debt doesn’t matter. Borrow and binge away. Nothing will go wrong. So back to the Olympics…for now. Regards, Nick Hubble for The Daily Reckoning Ed. Note: This article originally appeared here on the Daily Reckoning Australia site. Article posted on Laissez Faire Today

Natural Gas Leaves Oil in the Dust Posted: 21 Feb 2014 08:13 AM PST The polar vortex isn’t just wrenching your back from shoveling all that snow — it’s also decimating your heating bill. The cold, crappy weather throughout much of the country has helped natural gas break out of a five-year slump that has seen prices fall from close to $14 to a low of $1.90 in 2012. But back in the fall, traders flipped the switch to “buy”. The result? Natty is up more than 64% over the past three months alone… But what about oil? Turns out, black gold is looking downright sluggish. Oil’s up more than 4% year-to-date. That easily bests the broad market — yet falls way short of the natural gas rally. “While natural gas prices have been rallying, the move in crude oil has been much more muted,” explain the folks over at Bespoke Investment Group. “As a result of the wide gap in the performance of the two commodities, the ratio of crude oil prices to natural gas has narrowed considerably this year to a current level of around 16.5, which is the lowest level since July 2010. While the ratio is down considerably from the beginning of the year when it was at 23, and well off its record high of just under 54 from the Spring of 2012, as you can see in the chart, the last few years have been more of an anomaly than the norm. For example, from 1990 through early 2010 the ratio only broke above 20 once.” The million dollar question is whether we are truly seeing a return to a “normal” oil to natural gas ratio like we saw during the previous two decades. It’s tough to tell this early. It’s possible that natural gas maintains its recent breakout. Even so, I do think natty is due for a pullback phase to consolidate and digest its recent gains. Regards, Greg Guenthner for The Daily Reckoning P.S. As the US begins to thaw, a retreat in natural gas prices could help set up more than a few profitable trades. In this morning’s Rude Awakening email edition, I gave readers a chance to discover my favorite play in this sector – one that’s been on a tear recently. If you didn’t get it, don’t worry. I’ll be back every single trading day, right around the opening bell, to give you a quick rundown of what I’m seeing in the markets, and at least 3 chances to discover real profit opportunities in every issue. Sign up for The Rude Awakening, for FREE, right here, to get started.

Alasdair Macleod: Currency bubble may be next to pop Posted: 21 Feb 2014 07:34 AM PST 10:33a ET Friday, February 21, 2014 Dear Friend of GATA and Gold: GoldMoney's research director, Alasdair Macleod, writes today that all currencies are derivatives of the world reserve currency, the U.S. dollar, and when dollar supply growth slows, they all risk crashing. "We are looking at a potential popping of a full-blown global currency bubble, which was generated as the solution to the last crisis," Macleod writes. His commentary is headlined "All Currencies Are an Inverse Pyramid Based on the Dollar" and it's posted at GoldMoney's Internet site here: http://www.goldmoney.com/research/analysis/all-currencies-are-an-inverse... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT Jim Sinclair plans seminars in Los Angeles and San Diego 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/ Join GATA here: Mines and Money Hong Kong Hong Kong Convention and Exhibition Centre Monday-Friday, March 24-28, 2014 Hong Kong Special Administrative Region, China 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: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT 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.

Peter Boehringer: More evasions from the Bundesbank on Germany's gold in the U.S. Posted: 21 Feb 2014 07:02 AM PST 10:03a ET Friday, February 21, 2014 Dear Friend of GATA and Gold: Peter Boehringer of the German Precious Metals Society, a leader of Germany's "Repatriate Our Gold" campaign, today elaborates on the evasions in the Bundesbank's latest statement about its attempt to recover its gold from the Federal Reserve Bank of New York. (See http://www.bundesbank.de/Redaktion/EN/Interviews/2014_02_19_thiele_hande....) Boehringer's commentary, headlined "Bundesbank Attempts to Subdue Concerns on Gold Repatriation," is posted at the Internet site of gold researcher and GATA consultant Koos Jansen, In Gold We Trust, here: http://www.ingoldwetrust.ch/bundesbank-attempts-to-subdue-concerns-gold-... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT Buy metals at GoldMoney and enjoy international storage GoldMoney was established in 2001 by James and Geoff Turk and is safeguarding more than $1.7 billion in metals and currencies. Buy gold, silver, platinum, and palladium from GoldMoney over the Internet and store them in vaults in Canada, Hong Kong, Singapore, Switzerland, and the United Kingdom, ­taking advantage of GoldMoney's low storage rates, among the most competitive in the industry. GoldMoney also offers delivery of 100-gram and 1-kilogram gold bars and 1-kilogram silver bars. To learn more, please visit: http://www.goldmoney.com/?gmrefcode=gata Join GATA here: Mines and Money Hong Kong Hong Kong Convention and Exhibition Centre Monday-Friday, March 24-28, 2014 Hong Kong Special Administrative Region, China 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: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT How to profit with silver -- and which stocks to buy now Future Money Trends is offering a special 16-page silver report with 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...

Gold Price "Technicals Dominate" on Rally Above 200-dma In Face of Rising Dollar, Stocks, Rates Posted: 21 Feb 2014 06:01 AM PST GOLD PRICE losses of 0.9% from yesterday were reversed Friday morning in London, taking the metal to $1323 per ounce, some $5 above last week's close.   World stock markets rose, and emerging-market bonds rose in price, after Ukrainian president Viktor Yanukovych offered protesters an early election to end this week's bloodshed, in a deal witnessed by Russian and Eurozone ministers.   The US Dollar ticked higher vs. the Euro. Treasury bond prices slipped, nudging 10-year US interest rates above 1-week highs at 2.75%.   Strong trading volume on the Shanghai Gold Exchange saw Chinese premiums above world gold prices edge higher to $3 per ounce from Thursday's 3-month lows.   "More of the same," says a note from Standard Bank's trading desk in London.   "Buying in US, leading to selling overnight in Asia, keeping it a 'buy on dips' market."   Fundamental factors should be weighing against gold prices, the note adds, pointing to the rise in equities, bond yields and the US Dollar.   But for now, says Standard Bank, and with open interest rising in the US gold futures market, "momentum still upwards – technicals will dominate."   Having breached the down-sloping channel in force since August, says technical analysis from Societe General, the gold price early this week "breached the rising channel [from New Year] and should pause."   "The 200-day moving average looks to be holding for gold," adds another bullion trading desk.   Thursday's London PM Gold Fix was set above its average of the previous 200 days for the fifth day in succession, the longest such run since January 2013.   Prior to last year, the gold price traded above its 200-day moving average 84% of the time since Jan. 2001.   Flat between April 2012 and April 2013 at $1660-1690, the gold price's 200-dma now sits at $1301.   "The overall action appears to be a bullish wedge," says technical analysis of the gold price from London market-maker Scotia Mocatta's New York desk.   "Risk is for another run to the topside, with a break of $1332 targeting last major high seen October 28th at $1361."   A daily close in the gold price "above 1337.83 would be the next bullish development," says another market-maker's note, also pointing to the resistance above that as $1361.

5 Tips for Investing in This Dirt-Cheap Sector Posted: 21 Feb 2014 05:48 AM PST Dear Reader, I hate big boats, so I try to avoid them. The feeling of the floor shifting beneath my feet makes me sick. I have never been on a cruise and intend to keep it that way. While traveling a few months ago, I had no choice but to suck it up and take a three-hour ferry voyage between the north and south islands of New Zealand. It was the only way for my wife and me to get to Picton, the small fishing village that was our next destination. As soon as I stepped onto the boat, I sought out a room with no windows. I thought maybe if I couldn't see outside, my inner ear—or whatever part of my body malfunctions at sea—wouldn't realize we had left land, and I could avoid that awful nauseated feeling. I tucked into a small booth, popped in my earbuds, and turned up the volume. About half an hour later, when the podcast I was listening to ended, I realized with great delight that I had forgotten I was even on a boat. The voyage was so smooth that I didn't feel the slightest bit queasy. I was overjoyed—my plan had worked! I removed my earbuds, pulled out my iPad, and started to read, content in knowing I had found a solution for my lifelong seasickness problem. In the back of my mind, I was already planning the Caribbean cruise for our next Christmas vacation. Then the intercom blared: "We apologize for the delay; we'll be departing shortly." Crap. When the ferry finally did pull away from port, it quickly not only became clear that my clever plan hadn't worked, but that locking yourself in a room with no windows makes seasickness worse, not better. Who knew? I ran up to the sundeck to find my wife, who also suffers from seasickness, but had smartly opted for the fresh-air approach. Thankfully, she had some anti-nausea pills, which I had previously refused to take. The distinct feeling that I was about to lose my breakfast overpowered my apprehension of taking medication, so I downed the pills. They saved the day. As much as I have suffered aboard ships in my lifetime, though, that's nothing compared to the agony people investing in ships—specifically, dry-bulk shippers—have endured in the last five years. Dry-Bulk Shippers—a Dismal Performance 2008 to early 2009 was a bad time for stocks in general—but shipping stocks really took it on the chin. One large, publicly traded shipper lost 98.7% of its value from peak to trough, and the others didn't do much better. Since then, most stocks in the S&P 500 have recovered in unison, thanks to the Fed's unprecedented money-printing. But dry-bulk shippers didn't recover at all; in fact, they sank to new lows into 2013. They've been terrible laggards in the economic recovery. Dry-bulk shippers, if you're not familiar, are the companies that own the ships that move goods across oceans. They carry iron ore, coal, wheat, and many other commodities from one country to another. It's a cyclical business, heavily dependent on the health of the economy. The problem was that shipping charter rates fell off a cliff in late 2008 and never recovered, so shippers couldn't make any money. Like any price, charter rates are a function of supply and demand—demand being the amount of stuff that needs to be moved across the ocean, and supply being the amount of ships available to do the job. As you would expect, demand plummeted during the financial crisis, but also recovered pretty quickly. Supply problems, on the other hand, persisted. The crux of the issue is that ships are huge and take two years minimum to build. There is no Amazon Prime for ships: if you order one now, you'll be lucky to get it before the next summer Olympics. For that reason, a lot can change from the time a ship is ordered to when it's ready for use. Shippers learned that lesson the hard way when they ordered a record number of ships in 2007 and 2008, in response to rising charter rates. Then the bust happened. Two years later, when demand was recovering, those previously ordered ships were finally starting to come online… at exactly the wrong time. The glut of ships kept shipping rates depressed, and many shippers struggled to survive. Charter Rates Are Finally Turning Up Now The new uptrend is also a result of supply and demand. After five disastrous years, the oversupply of ships is finally dissipating. And because ships take so long to build, the glut isn't coming back anytime soon. New ship deliveries are dropping sharply and will continue to fall through 2015. With charter rates finally turning back up after five long years of decline, the dry-bulk shipping industry is ripe for investment. Here are five tips on how to choose the best dry shipper. 1. Fixed vs. variable rates Some shippers contract their ships over long time frames, charging a fixed rate per day and locking in that rate for two to five years at a time. Others contract each ship on a per-trip basis, constantly adjusting prices to reflect the spot rate. Most shipping companies use a combination of both. If you're a conservative investor like me, your kneejerk reaction is probably to go with the fixed-rate shippers. Their revenues are more predictable, and thus they're more financially stable. But under today's market conditions, that would be a mistake. Because shipping rates are rising and should continue to rise, you want to own a shipper that contracts most of its ships at spot. Those companies will benefit first, and their stock prices will rise the most. In short, shippers that contract on spot have much more upside than their fixed-rate counterparts. 2. Don't invest in a shipper that might go bankrupt OK, this isn't exactly a profound tip. I might as well tell you not to use antifreeze as mouthwash. But it's a very important point when investing in shippers, because many of them are tiptoeing a little too close to the edge of bankruptcy for our liking. Why are so many shippers in critical financial condition? Keep in mind that their primary assets are gigantic, expensive boats. To acquire those boats, shipping companies often take on a lot of debt, leaving them more vulnerable to economic downswings than your average industry. Add to that the fact that the shipping industry has been a disaster for the last five years, and it's no wonder a sizable chunk of the industry is near financial distress. Before picking a shipper, make sure it can handle its interest payments and other fixed operating costs. Otherwise, it might not be around long enough to reap the benefits of rising charter rates. 3. Don't diversify You won't hear this advice very often, but it's key in this space. Here's why: as I mentioned above, thanks to years of dismal business conditions, most shippers are not the picture of financial health. In fact, six of the ten shipping candidates our analysts examined in this month's Casey Report actually have negative Altman Z-scores (a common metric that estimates the probability of a company going bankrupt). If you diversify among several companies, you'll surely end up with a few of those debt-laden deadbeats in your basket, dragging down your overall returns. It's much better to pick the best of the best, rather than allow mediocre companies to invade your portfolio in the name of diversity. 4. Use stop-losses… because shippers are volatile Of course, eschewing diversity and focusing your dollars on just one company adds a bit of risk. Dry-bulk shippers are volatile and can react strongly to macroeconomic news. For example, if Chinese factory workers stage a major strike, you'll know it by looking at dry-bulk shippers' stock prices that day. So you want to use stop losses to make sure that if things go bad, you only lose a little bit. The nice thing about the dry-bulk industry is that it's been beaten down so badly that share prices are still quite low, so the downside is limited. We've seen opportunities to buy a stock with 50% upside, where we can place a stop loss just 20% below its current price, making for an attractive 2.5:1 reward/risk ratio. 5. Use seasonality to your advantage Charter rates are seasonal. Typically, they decline in the first quarter of the year, which we're smack-dab in the middle of right now. There are a few reasons for that. One is that weather in Brazil and Australia—two important commodity producers—is generally bad this time of year, which slows down production. Another is that the Chinese New Year, China's most important holiday, falls in late January or February. Much like the week between Christmas and New Year's in the US, Chinese people take it easy during their most important holiday, so commodity demand softens. Given that we're pretty much right in the middle of the seasonal weak period, now's the perfect window to invest in shippers, before demand picks up again. As a shameless plug, if you'd like some assistance navigating the choppy waters of dry-bulk shippers, take The Casey Report for a risk-free test drive. In the current edition that was published just last week, our analysts identify the very best dry-bulk shipping stock. It's still very close to our buy range today. Moving on, I'll now pass the baton to Doug French, who dug into some interesting recent changes in finance mogul George Soros' portfolio. After that, globetrotting analyst and correspondent Jayant Bhandari will share his boots-on-the-ground insight about how to invest in the booming Asian high-end sector. Soros Buys a Golden Bottom Doug French, Contributing Editor George Soros has made billions in the market. He broke the Bank of England in 1992 with a monster bet against the British pound. These days the Hungarian octogenarian is best known for funding left-wing nuttiness. But no matter what you think of his politics, we've all had fantasies about bringing a central bank to its knees, just like him (well, maybe just some of us). While Soros continues his winning ways, studies show that on average, individual investors consistently underperform the stock market. It only makes sense. How is a person supposed to juggle work and family obligations, keep their Facebook pages updated, and still compete with the Soroses of the world? For most, nothing brings on slumber faster than perusing an annual report or SEC filing. The required legalese in company literature makes the eyes glaze over. One shortcut to avoid that boredom is to instead keep an eye on what big players like Soros are doing and follow along. When these whales make significant investments, the government requires disclosure in what's called a 13F filing with the Securities and Exchange Commission (SEC). These reports come public 45 days after the end of a quarter. Though we can't know what big investors are doing in real time, these filings give us an idea. Soros has been investing for a long time, beginning as an arbitrage trader in 1956. During his early years on Wall Street, he developed the theory of reflexivity, taking inspiration from the ideas of philosopher Karl Popper. Reflexivity states that valuations in any market produce procyclical "virtuous or vicious" cycles. In other words, prices tend to swing to much further extremes than fundamentals would suggest. The billionaire made news with his 13F last Friday. His "Soros Put"—a short position on the S&P 500—increased by 154% from last quarter to $1.3 billion. That's a big bet that the S&P 500 is going lower. And while it might be a hedge, it's the largest position in his portfolio at 11.1%. The folks at Zero Hedge point out that the puts amounted to 13.5% of Soros' assets under management at 6/30/13. But clearly, the famed investor sees less than smooth sailing, if not trouble, on the horizon. Scooping Up Barrick Perhaps more interesting to readers of this missive are a handful of other investments Soros made. First, understand that Soros is no gold bug. Not long ago, he called gold "the ultimate bubble." Yet in the fourth quarter, he seems to have warmed up to the yellow metal and companies that mine it. He purchased 6.3 million shares in Barrick Gold Corporation (ABX). Barrick was once considered best of breed in the mining space, but the company stock, which traded for near $50 a share two years ago, now goes for less than $20. The company lost over $10 billion last year due to project write-downs. A dividend cut and secondary offering also pummeled the share price late last year. In December, the company shook up its board of directors and appointed a new chief operating officer. The company's founder, Peter Munk, will be leaving this spring, along with longtime directors Howard Beck and Brian Mulroney. Despite those sizable setbacks, the company still had adjusted operating cash flow of over $4 billion last year. This year, Barrick estimates it will produce 6 to 6.5 million ounces of gold, down from over 7 million in 2013. The company says, "Lower production in 2014 reflects the company's strategy to maximize free cash flow and returns over ounces …" The average 2014 earnings estimate for Barrick among 27 analysts is $1.31 per share. At today's price of $20.81, that equals a P/E of 16. The S&P 500's PE is over 19. If the company were to hit its high earnings estimate of $3.00, its PE would be less than 7. There's an old saying, "When you're going to the dump, take a full load." Team Soros likely believes Barrick has dumped its baggage and found religion. Betting on the Miners Another brand-new position in Soros' portfolio is 1.2 million calls on GDX, an ETF that holds a cross section of large gold miners. He also increased his bet on the junior miners with a 90% increase in his ownership of GDXJ. So what does Soros—a gold agnostic at best and hater at worst—see in the mining shares? Soros' investment in the miners is being reported in the same breath as Paulson and Company's continued 10.2 million share position in the gold ETF GLD. However, John Paulson is a gold bull, and his is not a new position. Most importantly, Paulson's bet is a buy-and-hold strategy on the price of the metal only. Soros', on the other hand, is a riskier position that he presumably purchased because he expects the metals to increase in value soon. Soros is not using gold as a hedge; he sees the shares as a value play. And he should: GDX is down 60% from its highs; and GDXJ is down 75%. In his investing life, Soros has not been wrong very often. He has said, "I'm only rich because I know when I'm wrong … I basically have survived by recognizing my mistakes." Individual investors should heed Soros' advice and follow his lead. Cashing In on Asian Materialism By Jayant Bhandari A few months back, a young Chinese acquaintance of mine, who earns perhaps $500 a month, wrote to me about the loss of his iPhone. As someone who still uses a 10-year-old cellphone, I immediately wrote back asking why he owned an iPhone in the first place, as I'm sure it cost a year or more of his savings. In his current state of affairs, my friend must walk in the biting cold of the Chinese northeast to stand in line to collect hot water. So it's safe to say he had better uses for that money, like moving to a place with a bathroom or hot water. Alas, I just heard from him again. And guess what? He bought another iPhone, this one the newest, best model. That anecdote is representative of my observations of Chinese consumer culture. Whenever I visit China, I'm always shocked to see that people leave a lot of food on their tables uneaten. And as I walk the streets there, I always find myself wondering why there are so many expensive cars parked outside rather decrepit buildings. It took me a few visits to learn that in China, people with luxury goods aren't necessarily rich. Many women, for example, carry expensive name-brand purses. By outward appearances, they're doing well. But after getting to know them, I've realized that many Chinese people own a few expensive gadgets or garments, but are otherwise quite poor. The common narrative is that China's success over the past few decades has been driven by Chinese citizens embracing their Confucian ideals of working hard and being thrifty. Even economic and business textbooks attribute China's success to those factors. Chinese people do seem to be hard workers, so I can't argue with that. But in my personal experience, they're not thrifty. Far from it: by and large, as soon as they get a little money, they can't wait to spend it. I think that the touting of Confucian thriftiness is mostly a myth perpetuated among certain China bulls, as well as a retroactive rationalization for China's successes of the last three decades. Michael Pettis, a Beijing-based economist, explains that a mere couple of decades ago, Confucianism was associated with being spendthrift and lazy. He says that the reason China's savings rate is so high is not because the Chinese are astute savers, but because household earnings are a small—and shrinking—part of GDP. In other words, Chinese households lack access to cash. I'm a China bull myself. But I also believe we should look at the facts as objectively as possible. In this case, the facts do not support the mainstream view. The Path Forward To an investor, the million-dollar question is: how will today's poor to middle-income societies like China react to economic success? Will they save and invest to compound their wealth quickly? Or will they spend money as soon as they earn it? Which answer you choose will lead to drastically different conclusions about how these countries will evolve economically, and how (and if) you should invest in them. Personally, I'm betting Asians' high time preference (their desire to spend money now, rather than later) will win out. I visit malls in Asia often, and they're booming. I'm convinced that the growth of luxury goods and high-end services will continue and perhaps accelerate. It's pretty clear that as soon as Asian people have enough to eat, their brand consciousness kicks in, and they spend a disproportionate amount of money on status goods. I think that kind of consumption should not come until these countries' economies are more mature and can better support it. But who am I to tell people how to live? Regardless, here's a quick glimpse into the strength and financial prowess of the high-end sector in Asia: A nightclub operator, Magnum Entertainment Group Holdings Ltd. (HK:2080), recently IPOed in Hong Kong. Its share price increased approximately 100% shortly after the IPO. Prada's (HK:1913) brand value increased 30% in 2013. Sands China Ltd. (HK:1928) has a market capitalization of US$60 billion. Wynn Macau (HK:1128) has a market capitalization of US$22 billion. Macau, mind you, was a backwater colony of Portugal, dotted with a couple casinos, just 14 years ago. Now it's bigger than Vegas. For now, my eyes are on Louis XIII Holdings Ltd. (HK:0577; HK$8.95). It's building a casino in Macau that, when it becomes operational in 2016, will have minimum gaming bets of HK$5,000, and rooms starting at HK$10,000. In

Extreme Cold Weather Boosting Natural Gas Profits Posted: 21 Feb 2014 05:43 AM PST Mohammad Zulfiqar writes: Just like any other commodity, natural gas prices are affected by supply and demand metrics. If demand increases and supply remains the same (or declines), you have a perfect recipe for higher prices. Since the beginning of the year, this commodity’s prices are up more than 40%! Before you start judging where the prices will go next, you have to see what kind of factors can affect the demand or supply. Consider gold prices, for example. If the demand for gold increases and, at the same time, there’s a discovery of a major mine—the prices may not move as much as anticipated if the mine wasn’t discovered. The reason behind this is simple: there’s supply to meet the demand.

Gold, Silver, Acceleration and Money Velocity Posted: 21 Feb 2014 05:26 AM PST The wall of fiat money created over the last five years is staggering, offset only by the stasis that pervades its exchange. Money velocity is the key variable that will signal the character of confidence and the next wave of inflation.

The Probability That the Gold & Silver Miners Bear Market is Over is Now High Posted: 21 Feb 2014 05:22 AM PST It’s been a tough bear market for the gold and silver miners. The Philadelphia Gold & Silver Miners Index (XAU) reached a weekly high in April 2011 (225.79) and declined some 64% peak to trough by December 2013 (weekly low 80.43). After an 11-year bull market in the gold price from 2001 to 2013, which took it from $255 a troy ounce to a peak of $1,900 an ounce and back to $1,300 currently, the gold miners are not just back to 2001 levels, but also the mid-1980s levels. In other words, the gold and silver miners have not added value for investors over the long-term, and even a quadrupling in the gold price in the 2000s did not see them deliver higher and sustainable earnings, cash flows and dividends for investors.

Bundesbank Must Intervene To Reassure German Gold Will Come Back Posted: 21 Feb 2014 04:18 AM PST Has the German gold gone, at least the part vaulted by the US Fed? What is the reason that Germany’s gold repatriation goes ten times slower than initially planned (after one year), see here? Why was a new repatriation planning set up (after one year)? These questions have intrigued many gold observers, to the extent that the interest was sparked even outside the precious metals community. Recently, the German newspaper Handelsblatt released an article in which they openly express their doubts if Germany’s gold is still available. That speculation came after a new release that Germany’s first year of repatriation brought back much less gold than initially intended. Yesterday, the German Central Bank (Bundesbank) released an interview with Carl-Ludwig Thiele, Member of the Executive Board of the Deutsche Bundesbank. This is remarkable because it was conducted by journalists from the same newspaper (Handelsblatt). The article appeared in German in Handelsblatt on 19 February 2014 and on the site of the Bundesbank. The interview is copied below. The underlying dynamic can’t be more obvious. The Bundesbank was obviously not pleased by the questions that Handelsblatt brought up. The interview gives the impression that all is good with Germany’s gold. It is very likely that the Bundesbank asked the newspaper to make up on their previous article. Readers are invited to draw their own conclusions, based on the facts. As a sidenote, it would have been great if the journalists would have asked questions like “how comes tightness in the physical gold market has been that high since Germany announced its repatriation” or “did you check the serial numbers on the gold bars that the auditors were shown” or lots more as suggested by Jesse here and here Obviously, those questions would have gone too far for the Executive Board member. Bundesbank President Jens Weidmann described the partial transfer of German gold from New York as a trust-building measure in Germany.You are the one responsible for organising this major logistical undertaking. Indeed, we are inspiring trust by storing half of the 3,400 tonnes of gold in Frankfurt by 2020. Building trust also means being transparent. We were the first central bank to publish details of our storage facilities, including the respective quantities of gold stored there. Is there a scenario in which gold could begin to be used in monetary policy? A highly theoretical scenario would involve extreme turmoil on the foreign exchange markets. Germany safeguards its solvency through reserve assets. In addition to foreign currency, our reserve assets include gold reserves. This gold could be pledged or exchanged directly for foreign currency. That is also why we have left the other half of our gold reserves in New York and London. Although we thankfully do not envisage such a crisis scenario, central banks are designed for the long term. In October 2012, you promised the German Bundestag that you would transfer a total of 150 tonnes of gold from New York to Frankfurt by 2015.In January 2013, you extended the time frame to 2020 and increased the amount to 300 tonnes. What time frame are you looking at now? The plans are not contradictory. We specified our initial target in October 2012. In January 2013, we then presented a new gold storage plan and specified a new target that is considerably higher than the first. Instead of only 150 tonnes, we are now transferring 300 tonnes of gold from New York to Germany. So both targets still apply? We now consider ourselves bound to the new gold storage plan. But the three years have not yet passed. We shall wait and see. We are on the right track in any case. But the members of the German Bundestag have acted on the assumption of the initial promise.The second has got a more long-term oriented time frame. Was your initial promise overly ambitious? In the first year, you only returned five tonnes from the USA. It is not a question of "returning". The gold is being transferred to Germany for the first time. Until 1998, only 2% of our gold, or thereabouts, was stored in Germany. In the first year, we transported five tonnes from New York. This year, we will transfer 30 to 50 tonnes, or perhaps even more, from New York to Frankfurt. And there is still next year to come. Does that mean that the target of 150 tonnes is still attainable? Since we are in the midst of an ongoing process, I would like you to ask me the question again in two years' time. In any case, we will store half of the German gold reserves in Germany by 2020 at the latest. Why are you content with such a low target for this year?Is the programme still experiencing teething problems in its second year? No, it is not. We have planned the timing of the transfers in such a way as to ensure that 300 tonnes are transferred from New York to Germany by 2020 at the latest. There are these rumours that either the gold in New York is no longer there or you do not have unrestricted access to it.Why have you not called in auditors or other externals to oversee the transfers in response to such rumours? It astounds me that Handelsblatt pays any attention to such absurd rumours. I was in New York myself in June 2012 with the colleagues responsible for managing the gold reserves and saw for myself how our money is stored in the vault there. The Americans have never stonewalled or hindered us in any way. On the contrary, their cooperation has been most constructive in every respect. Our internal audit team was present last year during the on-site removal of gold bars and closely monitored everything. The smelting process is also being monitored by independent experts. Does this also apply to opportunities to inspect the stocks?You said a year ago that discussions on the matter with the Federal Reserve Bank of New York were making good progress. That is correct. We have enjoyed an excellent relationship of trust with the New York Fed for many decades. As regards the details of the contracts, however, we are bound by confidentiality which we cannot unilaterally break. From my visit to New York, I can tell you that a number of bars selected by us were removed, inspected and reweighed even while I was there. The inspections conducted by our internal audit team, during which an external auditor was also present, were also completed to our utmost satisfaction. Was an external auditor present during your visit to the New York Fed gold storage facility in June 2012? No, not during my visit. However, an external auditor was present for part of the time during the internal audit team's inspection of stocks. Did the gold from New York have to be melted down immediately? The gold was removed from the vault in the presence of the internal audit team and transported to Europe. Only once the gold had arrived in Europe was it melted down and brought to the current bar standard. Some of the bars in our stocks in New York were produced before the Second World War. It was confirmed after the melting process, as anticipated, that these bars were absolutely fine. The Federal Court of Auditors (FCA) sparked the debate by calling for an inspection of Germany's gold holdings abroad.When you announced in October 2012 that part of the holdings were to be transferred to Germany, the FCA responded that this was a first step, but not a comprehensive procedure. Is the FCA now satisfied? The FCA never demanded that the Bundesbank transfer gold to Germany. It was more concerned with extending its rights with regard to inspecting gold reserves abroad. The Bundesbank's internal audit department now has rights it never used to have. The Budget Committee has acknowledged the FCA's report, which concludes this discussion. Incidentally, the FCA examined the Bundesbank's annual accounts for 2012 and found no irregularities. The FCA claims it has no knowledge of newly agreed audit rights. The FCA has access to all information at all times. I am sure the President of the FCA will be able to confirm this for you. If the intention was to build trust, would it not have been better to postpone the smelting processso that you would have been able to present sceptics with the original bars? Prior to transportation, the original gold bars were handed over to us in New York. Our internal audit team checked the numbers of the bars there and then against its own lists. The very same gold arrived at the European gold smelters that we had commissioned. This ought to demonstrate to everyone that such conspiracy theories are completely unfounded. Calling in external auditors or critics was not an option? The Bundesbank's internal audit department is involved in the process from start to finish. Independent experts were present during the smelting process. Are there any advantages for the Americans in storing gold for other nations?After all, they are protecting our reserves free of charge. To answer this question, you need to look at the historical context. As you may know, gold reserves were established during the Bretton Woods fixed exchange rate system. Given the threat from the East at the time, it seemed the safest option was to store German gold as far west as possible. The gold was therefore stored in New York from the outset. So the Americans are taking on high storage costs for nothing in return? No, why high storage costs? The gold has been stored there for decades. The storage rooms already exist. Security guards cost money… It is not just our gold that they protect, but also that of other central banks. But that is a matter for the New York Fed. Just over a year ago, you were asked whether storing gold with the victors of the Second World War was not perhaps an echo of the old Bonn Republic when Germany was not yet a fully sovereign state.Back then, your answer was rather vague. What is your answer today? To my knowledge, gold was stored in New York, London and Paris mainly for security policy reasons. We transferred 930 tonnes of gold from London more than ten years ago without experiencing any difficulties with the Bank of England or upsetting German-British relations.  The same applies to the Banque de France and the New York Fed.

Gold Bugs Don’t Fear Strength, Plenty More Upside Ahead for Gold Stocks Posted: 21 Feb 2014 03:53 AM PST Major bottoms in any market or sector usually produce big rebounds and big gains for those who are correctly positioned. For some, the initial strong gains create trepidation that the market will experience a big correction or revert back to the previous bear market (which created the foundation for the big rebound). I've noticed this trepidation over the past few days from subscribers and other advisors preaching caution or hedging their recent gains. This is all well and fine but the evidence as well as history suggest not to worry because the gains will continue unabated over the intermediate term.

India Tightens 80:20 Gold Import Rules Posted: 21 Feb 2014 01:28 AM PST Defies analysts, industry and politicians by making gold imports harder ahead of elections...   GOLD IMPORT rules in India, the world's No.1 consumer nation overtaken in 2013 by China, have been tightened by the central bank.   The move defies widespread expectations of easier rules, by limiting new import licenses under the so-called 80:20 rule to the lower level of an importer's two most recent deals.   Launched in August 2013, and imposed ahead of last year's key gold-buying festival of Diwali, the rule states that 20% of any shipment must be re-exported before the rest can be released for domestic use.   Confusion over the exact meaning effectively closed India, which has no domestic mine output, to new gold imports, forcing internal prices as high as $150 per ounce above world benchmarks.   With importers granted 3 lots by their licenses, "Import of gold in the third lot onwards will [now] be the lesser of the [previous] two," said the Reserve Bank last week. Meaning the maximum third-lot imports will be "five times the export for which proof has been submitted or quantity of gold permitted to a nominated agency in the first or second lot."   Both of India's main political parties have this month backed some loosening of gold import rules ahead of May's national elections. Prime ministerial front-runner Narendra Modi of the opposition BJP made it part of his platform as long ago as September.   This week unnamed sources cited by the Reuters news agency said the current Congress Party government was considering a reduction in gold import duty from its historic record 10% to perhaps 8% or 6%.   The Gems & Jewellery Export Promotion Council (GJEPC) then urged the administration to cut gold import duty as low as 2%.   "We were looking forward to some relaxation on the 80:20 rule," specialist site Mineweb quotes one gold and silver dealer in Mumbai's famous Zaveri Bazaar, symbolic heart of India's huge bullion industry.   "We were promised this was in the works by government officials...[to] cut down on the surge in smuggling. These new norms are more stifling."

India Tightens 80:20 Gold Import Rules Posted: 21 Feb 2014 01:28 AM PST Defies analysts, industry and politicians by making gold imports harder ahead of elections...   GOLD IMPORT rules in India, the world's No.1 consumer nation overtaken in 2013 by China, have been tightened by the central bank.   The move defies widespread expectations of easier rules, by limiting new import licenses under the so-called 80:20 rule to the lower level of an importer's two most recent deals.   Launched in August 2013, and imposed ahead of last year's key gold-buying festival of Diwali, the rule states that 20% of any shipment must be re-exported before the rest can be released for domestic use.   Confusion over the exact meaning effectively closed India, which has no domestic mine output, to new gold imports, forcing internal prices as high as $150 per ounce above world benchmarks.   With importers granted 3 lots by their licenses, "Import of gold in the third lot onwards will [now] be the lesser of the [previous] two," said the Reserve Bank last week. Meaning the maximum third-lot imports will be "five times the export for which proof has been submitted or quantity of gold permitted to a nominated agency in the first or second lot."   Both of India's main political parties have this month backed some loosening of gold import rules ahead of May's national elections. Prime ministerial front-runner Narendra Modi of the opposition BJP made it part of his platform as long ago as September.   This week unnamed sources cited by the Reuters news agency said the current Congress Party government was considering a reduction in gold import duty from its historic record 10% to perhaps 8% or 6%.   The Gems & Jewellery Export Promotion Council (GJEPC) then urged the administration to cut gold import duty as low as 2%.   "We were looking forward to some relaxation on the 80:20 rule," specialist site Mineweb quotes one gold and silver dealer in Mumbai's famous Zaveri Bazaar, symbolic heart of India's huge bullion industry.   "We were promised this was in the works by government officials...[to] cut down on the surge in smuggling. These new norms are more stifling."

Nothing happens in any major market now without China's assent, GATA secretary says Posted: 20 Feb 2014 09:53 PM PST 12:50a ET Friday, February 21, 2014 Dear Friend of GATA and Gold: China's foreign exchange surplus is so large, your secretary/treasurer told King World News yesterday, that nothing happens in any major market -- bonds, gold, oil, and other commodities -- without China's complicity or assent and that China was almost certainly a participant in last April's desperate international central bank intervention against gold. The interview is excerpted at the King World News blog here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/2/21_Sh... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT How to profit with silver -- and which stocks to buy now Future Money Trends is offering a special 16-page silver report with profiles of nine companies and technical analysis of their stock performance. Six of the companies have market capitalizations of less than $800 million and one company has a market cap of only $30 million. The most exciting of these companies will begin production in a few weeks and has a market cap of just $150 million. Half of all proceeds from the sale of this report will be donated to the Gold Anti-Trust Action Committee to support its efforts exposing manipulation and fraud in the gold and silver markets. To learn about this report, please visit: http://www.futuremoneytrends.com/index.php?option=com_content&id=376&tmp... Join GATA here: Mines and Money Hong Kong Hong Kong Convention and Exhibition Centre Monday-Friday, March 24-28, 2014 Hong Kong Special Administrative Region, China 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: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT Buy metals at GoldMoney and enjoy international storage GoldMoney was established in 2001 by James and Geoff Turk and is safeguarding more than $1.7 billion in metals and currencies. Buy gold, silver, platinum, and palladium from GoldMoney over the Internet and store them in vaults in Canada, Hong Kong, Singapore, Switzerland, and the United Kingdom, ­taking advantage of GoldMoney's low storage rates, among the most competitive in the industry. GoldMoney also offers delivery of 100-gram and 1-kilogram gold bars and 1-kilogram silver bars. To learn more, please visit: http://www.goldmoney.com/?gmrefcode=gata

Why didn't Handelsblatt ask the Bundesbank the right questions about gold? Posted: 20 Feb 2014 09:09 PM PST 12:25a ET Friday, February 21, 2014 Dear Friend of GATA and Gold: Germany's Bundesbank has posted an English translation of an interview published Wednesday by the German business newspaper Handelsblatt with Bundesbank Executive Board member Carl-Ludwig Thiele, an interview that unfortunately concentrates on the logistics of repatriating some of Germany's gold from the Federal Reserve Bank of New York rather than on what might have been done with that gold: http://www.bundesbank.de/Redaktion/EN/Interviews/2014_02_19_thiele_hande... (Thanks to gold researcher and GATA consultant Koos Jansen for calling attention to the interview.) As if by calculation, Handelsblatt asks Thiele no questions aimed at the gold market policies of the Bundesbank, the Federal Reserve, and allied central banks, including: 1) In the last 20 years has the Bundesbank engaged in gold swaps or leases with other central banks, including the Federal Reserve and U.S. Treasury Department, or with other financial institutions? If so, what were the purposes of those swaps and leases? ... Dispatch continues below ... 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. 2) In the last 20 years has the Bundesbank traded in gold or gold-related financial instruments, directly or through the Bank for International Settlements or other intermediaries? If so, what was the purpose of such trading? Does the Bundesbank have gold accounts at the BIS or other central banks or financial institutions now? Will the Bundesbank disclose the records of such trades and accounts? 3) Is the Bundesbank aware of any central bank interventions in the gold market in the last 20 years? Will the Bundesbank disclose such interventions? 4) Will the Bundesbank disclose any and all correspondence it has had involving gold with other central banks and financial institutions in the last 20 years? 5) In the last 20 years has the Bundesbank participated in any meetings of the G-10 Gold and Foreign Exchange Committee or similar international committees involving the gold market? Does the Bundesbank have any records of such meetings and, if so, will the Bundesbank disclose them? 6) Over the last 20 years what has been the Bundesbank's policy, if any, toward the gold market? How, if at all, is the Bundesbank still involved in that market? Does the Bundesbank provide or has the Bundesbank provided support in any way to the Western fractional-reserve gold banking system? Of course it's easy to understand why the Bundesbank and other central banks might not want to answer such questions. Answers might disclose market rigging and deception. But why won't Handelsblatt ask such questions? Indeed, why won't any Western financial journalists put such questions to any Western central bank? Are market rigging and deception by government perfectly acceptable to financial journalism? CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. * * * Join GATA here: Mines and Money Hong Kong Hong Kong Convention and Exhibition Centre Monday-Friday, March 24-28, 2014 Hong Kong Special Administrative Region, China 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: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT Jim Sinclair plans seminars in Los Angeles and San Diego 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/

Shocking Trip Down The Rabbit Hole Of U.S. Secrets & Gold Posted: 20 Feb 2014 09:01 PM PST With so much chaos taking place around the world, today King World News spoke to the man who has been focused on uncovering sensitive government and market information for over 15 years. What he had to say will shock KWN readers around the world. Chris Powell covered everything from secret US government deals to China's insatiable desire to accumulate gold, and the trip down the rabbit hole involves former US Secretary of State Henry Kissinger, former US Treasury Secretary Henry 'Hank' Paulson, and the incoming Chinese President Xi Jinping. Below is what Powell had to say in this remarkable interview. This posting includes an audio/video/photo media file: Download Now

Alleged Gold & Silver Scams Abound Posted: 20 Feb 2014 09:00 PM PST Goldsilver

Silver and Gold Prices Have Bottomed, Period. Posted: 20 Feb 2014 04:20 PM PST Gold Price Close Today : 1317.10 Change : -3.50 or -0.27% Silver Price Close Today : 21.678 Change : -0.166 or -0.76% Gold Silver Ratio Today : 60.757 Change : 0.301 or 0.50% Silver Gold Ratio Today : 0.01646 Change : -0.000082 or -0.50% Platinum Price Close Today : 1410.90 Change : -12.00 or -0.84% Palladium Price Close Today : 736.90 Change : 0.90 or 0.12% S&P 500 : 1,839.78 Change : 11.03 or 0.60% Dow In GOLD$ : $253.21 Change : $ 2.12 or 0.84% Dow in GOLD oz : 12.249 Change : 0.103 or 0.84% Dow in SILVER oz : 744.22 Change : 9.90 or 1.35% Dow Industrial : 16,133.23 Change : 92.67 or 0.58% US Dollar Index : 80.320 Change : 0.100 or 0.12% Silver and GOLD PRICES kept on relaxing today. Although they closed lower on the Comex (lovely shade of tape painting), at end of day they were higher. At Comex close the GOLD PRICE had lost $3.50 (0.3%) to $1,317.10 and silver gave up 16.6 cents (0.8%) to 2167.8c. Looking at both charts, SILVER and gold are forming flags or pennants. These formations form after a sudden high rise as the market trades sideways digesting the quick gains. Rule of thumb says "flags always fly at half staff," i.e., the flag marks the half way point of the move. I wore my eyes out doing another study of indicators today -- too complicated to explain, but it says very loudly and with very small chance of error that silver and gold prices have bottomed, period. Do y'all ever get tired of the Self-Appointed Righteous pontificating in their nasal voices over the airwaves about how "we" (they always carry a mouse around in their pockets) "must" (always imperative) correct some wrong or other in the world, whether its keeping children in Hong Kong from getting too many spankings or putting pants on poor naked cats all over the world? Mercy, I am plumb wore out with it. It's like having to live with Hillary Clinton or Eleanor Roosevelt, or like waking up in a nightmare being married to both of 'em. Listen, I am too busy trying to mind my own business and straighten my own self out to run around the country or the globe messing in other people's business. But this same meddlin' mentality has seized control of US foreign policy so that every time "we" (there's that mouse again) don't fancy what somebody else does, we launch an invasion and go kill 'em to save 'em. It's called the "Janet Reno Waco Option." Latest crisis is what will Colorado do with the $100 million in sales tax it's collecting on marijuana sales. Colorado's governor with the improbable and ironic name Hickenlooper wants to spend $50 million of it on programs to keep kids from smoking dope. Now, this leaves me scratching my head. Maybe y'all can make sense out of this. I can't. Let's look at markets. Maybe they'll make sense. Stocks recovered somewhat today. Dow added 92.67 (0.58%) to 16,133.23 while the S&P500 managed about the same gain with 11.03 points or 0.6%. There's an eye-catching divergence between these two stock indices. On this latest rally the S&P500 made an intraday high yesterday at 1,847.50, nearly the same as its January new all time high at 1,850.84. This makes a screaming megaphone or broadening top formation since last November with higher or flat highs and lower lows. Compare that to the Dow, the "senior" index. Since the Dow's intraday all time high at 16,588.25 at end-December, the Dow has only fallen and fallen. And the February reaction has only taken it as high as 16,225.72 yesterday. WHY do these two indices look so different? Why does the Dow look so much weaker than the S&P500? Meanwhile the Dow measured in metals continues to slide. After a little bounce up yesterday the Dow in Silver dropped 0.74% to 739.55 oz, dancing around its 200 DMA (now 740.70). Dow in gold is not falling nearly as fast, down today 0.33% to 12.20 oz (G$252.20 gold dollars). US Dollar Index rose a measly ten basis points today (0.12%) to 80.32. Dollar still gives no unequivocal hint which way the Nice Government Men intend to take it. The schizo-euro today flaked and dropped back below that old uptrend line, apparently forced back by the longer-term downtrend line. Closed $1.3719, down 0.13%. Yen went sideways and the Japanese Nice Government Men went home for a well-earned cup of hot sake. On 20 February 1811 Austria declared bankruptcy. The more things change, the more thay remain the same. 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.

Silver and Gold Prices Have Bottomed, Period. Posted: 20 Feb 2014 04:20 PM PST Gold Price Close Today : 1317.10 Change : -3.50 or -0.27% Silver Price Close Today : 21.678 Change : -0.166 or -0.76% Gold Silver Ratio Today : 60.757 Change : 0.301 or 0.50% Silver Gold Ratio Today : 0.01646 Change : -0.000082 or -0.50% Platinum Price Close Today : 1410.90 Change : -12.00 or -0.84% Palladium Price Close Today : 736.90 Change : 0.90 or 0.12% S&P 500 : 1,839.78 Change : 11.03 or 0.60% Dow In GOLD$ : $253.21 Change : $ 2.12 or 0.84% Dow in GOLD oz : 12.249 Change : 0.103 or 0.84% Dow in SILVER oz : 744.22 Change : 9.90 or 1.35% Dow Industrial : 16,133.23 Change : 92.67 or 0.58% US Dollar Index : 80.320 Change : 0.100 or 0.12% Silver and GOLD PRICES kept on relaxing today. Although they closed lower on the Comex (lovely shade of tape painting), at end of day they were higher. At Comex close the GOLD PRICE had lost $3.50 (0.3%) to $1,317.10 and silver gave up 16.6 cents (0.8%) to 2167.8c. Looking at both charts, SILVER and gold are forming flags or pennants. These formations form after a sudden high rise as the market trades sideways digesting the quick gains. Rule of thumb says "flags always fly at half staff," i.e., the flag marks the half way point of the move. I wore my eyes out doing another study of indicators today -- too complicated to explain, but it says very loudly and with very small chance of error that silver and gold prices have bottomed, period. Do y'all ever get tired of the Self-Appointed Righteous pontificating in their nasal voices over the airwaves about how "we" (they always carry a mouse around in their pockets) "must" (always imperative) correct some wrong or other in the world, whether its keeping children in Hong Kong from getting too many spankings or putting pants on poor naked cats all over the world? Mercy, I am plumb wore out with it. It's like having to live with Hillary Clinton or Eleanor Roosevelt, or like waking up in a nightmare being married to both of 'em. Listen, I am too busy trying to mind my own business and straighten my own self out to run around the country or the globe messing in other people's business. But this same meddlin' mentality has seized control of US foreign policy so that every time "we" (there's that mouse again) don't fancy what somebody else does, we launch an invasion and go kill 'em to save 'em. It's called the "Janet Reno Waco Option." Latest crisis is what will Colorado do with the $100 million in sales tax it's collecting on marijuana sales. Colorado's governor with the improbable and ironic name Hickenlooper wants to spend $50 million of it on programs to keep kids from smoking dope. Now, this leaves me scratching my head. Maybe y'all can make sense out of this. I can't. Let's look at markets. Maybe they'll make sense. Stocks recovered somewhat today. Dow added 92.67 (0.58%) to 16,133.23 while the S&P500 managed about the same gain with 11.03 points or 0.6%. There's an eye-catching divergence between these two stock indices. On this latest rally the S&P500 made an intraday high yesterday at 1,847.50, nearly the same as its January new all time high at 1,850.84. This makes a screaming megaphone or broadening top formation since last November with higher or flat highs and lower lows. Compare that to the Dow, the "senior" index. Since the Dow's intraday all time high at 16,588.25 at end-December, the Dow has only fallen and fallen. And the February reaction has only taken it as high as 16,225.72 yesterday. WHY do these two indices look so different? Why does the Dow look so much weaker than the S&P500? Meanwhile the Dow measured in metals continues to slide. After a little bounce up yesterday the Dow in Silver dropped 0.74% to 739.55 oz, dancing around its 200 DMA (now 740.70). Dow in gold is not falling nearly as fast, down today 0.33% to 12.20 oz (G$252.20 gold dollars). US Dollar Index rose a measly ten basis points today (0.12%) to 80.32. Dollar still gives no unequivocal hint which way the Nice Government Men intend to take it. The schizo-euro today flaked and dropped back below that old uptrend line, apparently forced back by the longer-term downtrend line. Closed $1.3719, down 0.13%. Yen went sideways and the Japanese Nice Government Men went home for a well-earned cup of hot sake. On 20 February 1811 Austria declared bankruptcy. The more things change, the more thay remain the same. 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.

GERALD CELENTE - The GLOBAL COLLAPSE is in FULL FORCE. Its Time the SHEEPLE WAKE UP Posted: 20 Feb 2014 03:00 PM PST If there's one thing that should be clear, it's that nothing the government or their banking partners have done to solve the economic crisis has been for your benefit. They've enriched themselves, yet again, on the backs of the American people.All the while, they've told us that everything is... [[ 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! ]]

This Is What Happened The Last Time Silver Went Up 14 Days In A Row Posted: 20 Feb 2014 02:38 PM PST Silver and gold had a minor down day yesterday which came after an incredible advance. In particular, silver went up for 13 days in a row, an event rarely seen before. As Zerohedge notes: “Silver is now up 13 days in a row… this is the longest winning streak since at least 1968. Both gold and silver have broken through their 200-day moving averages (and the often-watched 150-day).” While it is interesting to know that silver experienced an exceptional surge, it is far more interesting to see how it played out in previous instances. The following chart (courtesy: Sharelynx) shows there was one comparable event, in particular in 1979, when silver advanced for 14 days in a row. The chart clearly shows that it marked the start of silver’s mega run. This is not to say that it will happen again, right here right now. The key take-away is that silver (and gold) has shown powerful strength at the start of 2014. We can be sure that’s no overstatement. The other message could be that a long term bottom is in.

Gold Trader: “We’re [Now] Starting A Final Parabolic Bubble Phase In The Stock Market” Posted: 20 Feb 2014 02:29 PM PST Following a recent surge in precious metal and mining equity prices, Gary Savage, technical gold trader and publisher of the Smart Money Tracker was kind enough to share a few comments. Here is his full interview with Tekoa Da Silva: TD: Gary, you published a piece last Friday, February 14th entitled "Another Piece of the Puzzle Falls into Place," in which you laid out some pretty big market expectations for the stock market, commodities, gold and for the dollar as well. I'm wondering if you can talk to us a little bit about that. GS: Sure Tekoa. My overarching theme for 2014, and what is going to drive all other markets, is that

China Must Be Very Concerned About The US Dollar Posted: 20 Feb 2014 02:19 PM PST The dollar’s downward spiral may not be visible to most, it certainly is there. The US dollar index has been in a wide trading range in the last 12 to 15 months, between roughly 78 and 85 points. Today, Bloomberg reported that China, who is the largest foreign creditor of the US, reduced its US Treasury holdings in December by the most in two years. That comes after the Federal Reserve announced its plans to slow asset purchases. The nation pared its position in U.S. government bonds by $47.8 billion, or 3.6 percent, to $1.27 trillion, the largest decline since December 2011, according to U.S. Treasury Department data released yesterday. At the same time, international investors increased holdings by 1.4 percent, or by $78 billion, in December, pushing foreign holdings to a record $5.79 trillion. A less nuanced chart was released by Zerohedge in which it appears that the December decrease of US Treasuries by China was the second largest in history. This evolution brings up two questions: What are the Chinese up to? Is China pushing to replace the dollar by their own currency? Two questions which seem easy to answer on the surface. However, the answer could be more complex than most would think. That’s why the view of a currency specialist is really required. Jim Rickards, author of the book Currency Wars, explains that China’s aim is to replace the dollar by SDR’s [Special Drawing Right, a type of money for governments]. It is issued by the IMF, and China is simultaneously lobbying for more votes in the IMF. (source) China is trying to use its willingness to lend money to the IMF to purchase SDR notes from the IMF to give the IMF money to bail out Europe. It's trying to use that as a lever to get more votes. If it has more votes, it would be comfortable using the SDR as a reserve currency, because its use would be regulated by the membership and that would make China the second largest member after the United States. The United States is opposing it, but Christine Lagarde, is pushing very hard to increase the Chinese role. It's a complicated global game. If you said to me, does China want to get rid of the dollar as the global reserve currency, the answer is yes. But most people think it's that they want the yuan. They don't. It's the SDR. Is China aiming to have their yuan become the world reserve currency? The spontaneous answer would be “yes”, but here again, Jim Rickards has a different opinion. He thinks that the yuan will not become the reserve currency for two reasons: A: They don't want to open their capital account. B: The yuan can't possibly be a global reserve currency. It is expanding in use as a trade currency, but most people don't understand the difference between a trade currency and a reserve currency. The trade currency is just a way of keeping score in the balance of payments mechanism. Rickards distinguishes a reserve currency and a trade currency. For instance, in trading agreements between Brazil and China, it could be true that Brazil agrees to take yuan for Brazilian goods, and China agrees to take reals in exchange for Chinese goods. The countries settle up every now and then. That's a trade currency. “But to be a reserve currency means that countries that have reserves have to invest it in something, so you need a deep liquid pool of investable assets. China does not have that. There is no Chinese bond market. There are a few Dim-Sum bonds and a few other things, but there is no Chinese government bond market to speak of, and it would take 10 to 15 years to develop one.” But it's not just about issuing debt. China doesn't have to borrow because they have too many reserves. If they don't borrow then there are no bonds, and if there are no bonds there can't be a reserve currency because there is nothing to invest in. Even if they did, there is no rule of law in China, so why would you trust the Chinese not to steal your money? So putting all that together, they are not even close to being a reserve currency. Taken all this together, it seems that things are more complicated as they seem. There is no easy solution to replace the dollar would it collapse under its own debt burden. SDR’s could become an alternative. So the question is why China is buying huge amounts of gold? This is what Rickards has to say about it: All we have to do is inflate our currency and pay them back in cheaper dollars and that reflects a wealth transfer from China to the United States. So China is completely vulnerable to that, which is why they are buying gold to create a hedge. If we inflate, then gold will go up. So what they lose on the paper, they make on the gold. China is buying gold to hedge against the dollar’s loss of value, they are not necessarily buying gold to introduce a new gold standard and impose it as a world reserve currency. From that perspective, the Chinese must be very concerned about the dollar.

U.S. Dollar: Still King of Fiat Currencies Posted: 20 Feb 2014 01:49 PM PST Adam Smith was a great 18th-century thinker and pioneer in economics. He had an idea about how to predict when a financial crisis was imminent. In his magisterial work, The Wealth of Nations, he wrote: "Follow the flows, baby. Follow the flows." Well, if he didn't write it, he should have. The fact is modern economies float on a sea of money. When you drain that money away, some of the ships start to run aground. The U.S. current account is one way to measure the water level for the global economy. Right now, it's giving off a major warning signal… You can think of the U.S. current account balance as reflecting the flow of dollars to and from foreigners. A negative U.S. current account balance means foreigners are adding to their dollar holdings as dollars are flowing out of the U.S. When an American buys an imported good, the current account balance reflects that transaction as a negative number. Dollars flow out and the good flows in. Much of the time, the U.S. has had a negative current account balance. But when it hasn't, or when the size of the deficit shrinks, bad things tend to happen to markets abroad. I borrow the nearby chart from Charles Gave, a 40-year veteran of markets and co-founder of the research firm GaveKal. In a note he put out on Feb. 7, Gave writes: "During my career, all international financial crises have occurred against the backdrop of an improving U.S. current account deficit as evidenced by the first chart." In the chart above, a widening U.S. current account deficit is above the zero line. (The chart's flipped.) When the current account slips below the zero line, the deficit is shrinking. The U.S., in a sense, is shipping out fewer dollars. As Gave says, it is "adding less liquidity." You can see that when the shaded red part is below the zero line, some kind of crisis occurs. And look where we are now. Yes, below the zero line. When the current account balance shrinks, there are fewer dollars going overseas, which creates a problem for other countries. As Gave writes: "The problem is that the rest of the world must find dollars to buy energy, conduct trade settlement and service dollar debts." The U.S. dollar is (still) the king of currencies. It is the reserve currency. This means other countries rely on it and use it. They don't settle up in Chinese yuan or euros or yen. (Not on any great scale.) They use dollars. So think back to old Econ 101. Less supply and strong demand means the price goes up. So a whole raft of foreign currencies has fallen against the U.S. dollar in the last year. But there are other interesting correlations at work here, too. Global bear markets tend to happen when U.S. current account improves, as Gave points out. That's not a surprise. Think about what those depreciating currencies mean for the economies involved. It means it is becoming more expensive to buy things from abroad. The Wall Street Journal ran an interesting article about the effect of this in South Africa. Sheffield makes auto parts and cutlery in South Africa, where the rand has lost nearly 25% of it value against the dollar in the last year. Sheffield must now pay more for nickel and chrome imports. It can't pass these costs on, so its profit margins get squeezed. The weak rand also squeezes consumers. Workers have gone on strike for wage increases. It gets messy quickly. To some extent, all of these countries have to go through some adjustments as their currencies fall. These won't be painless. It can make it hard on some businesses in these countries. And no surprise, the stocks tend to underperform. The flip side is that U.S. stocks tend to outperform. Again, not surprising. Gave distills it down to the essence: "If the world outside of the U.S. faces a shortage of dollars, then one should be invested in the place with a concentration of enterprises that hold positive cash flows in dollars." That place is, of course, the U.S. Since 1970, U.S. stocks have tended to beat out global markets when the U.S. current account improves. The U.S. cut the dollar's remaining ties to gold in 1971. Ever since, it's floated and been nonconvertible into anything but itself. So any analysis before that date is not applicable. Take a look at the nearby chart. This doesn't mean U.S. stocks have to go up. U.S. stocks could simply go down less than foreign stocks. (Note the EAFE index in the above stands for Europe, Australasia and the Far East. It's the oldest international stock index, dating back to 1969. I suppose that's why Gave chose it.) Besides, the usual caveats apply. There is no guarantee that markets will conform to past patterns. And everything above is essentially backward looking. It explains what has already happened. Trends can change quickly. The U.S. current account deficit can turn around and widen again. Some foreign markets may well prove excellent buys here. (I have my favorites.) The main point here is to recognize the pressure the shrinking U.S. current account puts on the rest of the world. You ignore these macroeconomic credit conditions at your peril. As Jim Grant put it in a recent interview when asked about investors fancying themselves macroeconomists: "Let me tell you first about the ones who refused to fancy themselves macroeconomists. Investors who turned a blind eye to credit — to monetary policy, to the Federal Reserve — didn't notice the stupendous buildup of bad debt through 2007. They tended to own a lot of optically cheap financial stocks that got cheaper and cheaper until they weren't there anymore." In the pages of my newsletter, Capital & Crisis we have always been attentive to the credit cycle. Maybe it's the former banker in me. The current credit cycle is one of tightening global liquidity in U.S. dollars abroad. Yet I continue to hear and read about how "emerging markets are cheap." Some of them may well be. But maybe they are cheap for a good reason. They can just get cheaper. And cheaper still. "We can't know the future," Grant added, "but we can observe the present." I agree. What the present shows is that the risk of a global bear market is high. It also shows how dependent much of the rest of the world is on U.S. dollars. The U.S. dollar is still — still! — the king of fiat currencies. Regards, Chris Mayer for The Daily Reckoning Ed. Note: In today’s issue of The Daily Reckoning, readers were given a chance to discover a more in-depth view of Chris’ incredible research – which could have led to some pretty significant profit potential for their portfolios. It’s just one small benefit of being a reader of The Daily Reckoning email edition. Make sure you don’t miss out on any other great opportunities like this. Sign up for the FREE Daily Reckoning email edition, right here.

Silver Does Not Have Much Resistance Between $21 and $26 Posted: 20 Feb 2014 01:42 PM PST In this week’s online radio appearances, David Morgan explains his latest take on precious metals in 2014 and the very short term silver price. He touches on more fundamental questions like the dollar world reserve currency and the financial system. We highlighted several quotes in this article. David Morgan his 2014 outlook on precious metals: This year there has a lot of fresh buying in the precious metals and especially in the miners. Silver is up 10% while some miners are up 50% or even 100%. The precious metals sector is the highest flying one since the start of this year. This has caught several people by surprise, but not us (The Morgan Report) as we expected this would happen in 2014. Silver’s near term price action Silver does not have a lot of resistance between $21 and $26. The $26 level was a break down on a huge volume so that level will be defended. As silver will go back to those levels, it will back down probably. Expect some resistance there and two or three retests before it breaks through it. Once through it, this level will act as support. It will take some time though, I expect to see this action over the course of this year. Silver could be to the 30 level before the end of the year, but not before the summer. However, because of the high number of geopolitical tensions across the globe, things could evolve much more rapidly however. The dollar reserve currency hegemony breakdown: The dollar remains the global reserve currency. The petrodollar status is waning. There is lots of conversions to oil with China in particular and other nations that are not settling in dollars, which is expected to continue. Once that trend continues and accelerates, the standard of living of lots of Americans will decrease for the ones that did not prepare themselves for a financial reset. If you own gold, you will have deflation in terms of the gold you hold but inflation in terms of the paper money you hold. The instability of the financial system The instability of the system is speeding up. This is typical of the end of Empire, near the end it accelerates. There is only a small minority of people who realize what is going on and prepare appropriately. It is the 100th monkey effect, a certain tipping point when the wakeup call accelerates. That is when the system accelerates to the downside. The Radio shows are here and here. David Morgan is the editor of the highly respected The Morgan Report which offers 16 specialized reports for free for new subscribers, as well as a free trial of one month (more info here).

Gold Daily and Silver Weekly Charts - The Reivers Posted: 20 Feb 2014 01:28 PM PST

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