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- Geneva Talks Pressure Gold
- High frequency trading shakes out weaker gold positions - Phillips
- Economic Outlook Darkens
- Gold, Silver and Stalling Economies
- US Bull Overextended
- News quiz: Have you heard this?
- Euro has no future. Maxcoin and Bitcoin do!
- Gold Forecast: This is going to be exciting
- Economies stalling
- Economic Outlook Darkens
- Globalist Gangster’s Nevada Land Grab
- Copper is pathological and suffers from SAD, but it has value - Goldie
- Gold, Silver And The Mining Sector: Prepare For A Severe Fall
- Two More Victims Of The Retail Apocalypse: Family Dollar And Coldwater Creek
- Banking Bail-Ins: Destroy the Depositors
- The Doc: Gov’t Planning CYPRUS-Style BAIL-INS!
- Big Pictures: Stocks, Gold and the Miners
- GEAB N°84 is available! Europe dragged into a division of the world between debtors and creditors: the United States' desperate solutions for not sinking alone
- Guinea gold mine collapse kills at least six - official
- Japan & the US: Money Printing Does Not End Depressions!
- Paper gold falls in West but premium for real metal jumps in India
- Asia takes every ounce West unloads but gold will fall for two years, GFMS says
- New report says Obama is "cooking the books" on Obamacare
- It’s Time to Ditch the Consumer Price Index (CPI)
- Use of gold as collateral in China is actually positive for gold, Rule tells KWN
- Ukraine Currency Collapses Nearly 70% Against Gold In 4 Months
- Gold market looks for India to relax import restrictions
- This is the catalyst for an "Arab Spring" in China... and I'm doubling down...
- GOFO Rates Plunging- Are We On the Verge of Another Rally?
- Gold set for a weekly drop
- Jim Willie: Fed Has Lost Control, Systemic Failure Flashing Warning Signals Now!
- Ukraine Currency Collapses Nearly 70% Against Gold In 4 Months
- Links 4/17/14
- Gold trades below $1,300 an ounce Physical buying picks up
- Gold Import Curbs Seen Continuing in India to Help Currency
- Three King World News Blogs
- Scientists Verify World's Largest Single Crystal Piece of Gold
- How Marriage Is Keeping Gold’s Prospects Bright in China
- Gold Import Curbs Seen Continuing in India to Help Currency
- India’s Gold Demand Surges as Supply Declines
- India's Pain Is UAE's Gain - Indian Expats Buy Up Gold Jewellery
- Lawrence Williams: Jansen Sticks By China Gold Demand Figures
- 'I invested in gold three years ago and lost 70pc - should I sell?'
- General Mills Opens New Frontier in Denying Consumers Right to Sue: Just Use Its Products
- Gold hovers above support at $1295 (S1)
- How Silver is Making a Slow Recovery in 2014
- Fort Knox Looted of 7,000 Tons of Gold in 1973-1974 says 1981 Article!
- When Will Big Business Figure Out That the Education-Industrial Complex is Eating its Lunch?
- Silver at its cheapest compared to gold in five years
- Gold, Silver And The Mining Sector: Prepare For A Severe Fall
| Posted: 17 Apr 2014 01:16 PM PDT "She loves me; she loves me not", could be the expression best used to "time" one's entry into or out of the gold market lately. Just look at the headlines I have chosen to employ the last few trading days and you will get the idea. Back and forth they have gone as the mood of the market has been flipping from day to day. Most of gold's recent gains are related to the situation in Ukraine; take that away and the other fundamental factors remain bearish. Gold is therefore ultra sensitive to any sort of swing/change in what is taking place over there. Today, apparently talks in Geneva ( 6 hours worth ) between the US, Russia and the EU, yielded some fruit, at least in the mind of traders. A framework was agreed upon which it is hoped that tensions could be throttled back. We'll see how that goes but for today, it was negative for gold prices, especially with yields on US Treasuries rising and a stable to firm Dollar. The yield on the Ten Year jumped today to 2.721% as I type these comments from a low near 2.60% earlier this week. Again, at the risk of beating a dead horse, buying gold based on geopolitical tensions is always tenuous at best because as soon as those tensions are viewed as diminishing, gold is going to come under selling pressure not only from longs who are seeking to book any gains that they might have achieved before those are lost, but also from opportunistic shorts who are hoping for additional long liquidation to take the market down into sell stops that they have been eying. We got that today in the form of a breach below psychological chart support at the $1300 level. Once gold lost that "13" handle, the stops kicked in and took it down sharply. It did get some buying right above $1290 but the technical damage was done at that point. Looking at the daily chart, the market looks heavy heading into next week. Keep in mind that we have a long holiday weekend in the West with Easter coming up. That means a lot can happen between now and Sunday evening ( in the West) or Monday morning in Asia. If we do not see any flareups over in Ukraine over the weekend, gold could be in for some more selling come then. Everything is contingent on events meaning the market can go either way. Back to the chart however...The big move down on Tuesday this week has cast a bearish pall over the market. It did bounce from the support level near $1280 but that was due to events in Ukraine. Two things have happened as a result of this. First, is that the price fell BELOW the 50 day moving average on Tuesday; that is negative. Then today, it fell BELOW the 200 day moving average once again. It should be noted in a trendless market moving averages are notorious for producing whipsaws but nonetheless, technicians keep an eye on these things to try to gauge just who might have the upper hand, bulls or bears.  The support noted is not that far off meaning if tensions lighten up a bit over the weekend, we will more than likely see gold test that support level. If it holds, fine. If it does not, $1260 will be seen in short order followed by a trip to $1240 if that fails to stir up active buying. All of this to say one simple thing - $1280 is shaping up to be a most significant chart technical level. If the bears crash it, watch for them to really pour on new, fresh short positions. The ADX continues to move lower indicating the trendless feature of this market. The trading range, once between $1400 and so on the top and $1280 on the bottom has now constricted to near $1320 on the top with the bottom remaining the same. Bears are currently in control based on the directional movement lines. A big contributor to the lack of upside enthusiasm in gold continues to be the poor showing by the gold mining shares. As mentioned yesterday, the market does not like these bidding wars it is seeing among some of the larger firms and is punishing their stock prices as a result. By more importantly, look at the technical price chart of the HUI and you will see what the problem is:  The HUI ended last week on a horrible note and it has been bleeding lower for most of this week. As things now stand, it is precariously perched just on top of chart support near 216 closing in the lower half of today's trading range. If it loses that, there is not much in the way of help until the index would near 211- 210. If 210 were to go, all bets would be off for the gold shares as one could begin to make the case that the index is on course to surrender all of the gains of the year. Let us hope not for the long suffering bulls. Disgruntled Bulls - Please keep the hate emails and the nasty posts to yourself as I am just relating how things could shape up from a purely technical posture.  The overall commodity sector ( as a whole ) is working higher adding some support to gold but as far as any sort of upside trending move higher, the GSCI is not indicating one at the moment. Instead we see the index continuing to make a series of lower highs and relatively stable lows. Keep in mind something I wrote yesterday - this index is designed to key off of the most active or front months in the commodity futures markets. Currently a goodly number of these markets are showing markets in a backwardation structure. What is important to note about this is that the futures markets are anticipating a comedown in commodity prices as we move deeper into this year. Markets, being forward looking by nature, are discounting any serious threat of upward price pressures later this year. Of course, unforeseen events, especially weather, can always trigger reassessments of such things, but for now, the markets are signaling a break in upward price pressures in the commodity sector towards the third quarter of this year. Along this line, economic data coming out of China will be closely scrutinized. There are already rumblings of credit issues in that regards involving Chinese buyers of soybeans. That is not insignificant and will be closely watched due to its implications in the grain markets. Old crop beans seemed a bit nervous about this today although with the way the funds have been buying them, they did not break down all that much. Quite frankly, that soybean market makes me nervous. There remains a large number of farmers who are sitting with last year's beans in their storage bins who apparently will not let go of them. I have no idea what they are waiting for. If the function of the market is to ration demand, it is certainly doing that judging from the export numbers we got this morning. Maybe we need to see another week of poor numbers to convince some of these guys that prices are getting rather lofty. The thing is however, as long as the funds can push them higher without any serious hedge pressures from commercial entities, they are going to do just that. Standing in their path is a quick way to become a "former" commodity trader. With the markets being closed for Easter, it will be a nice break away from the madness. We Christians celebrate the Resurrection of the Lord Jesus Christ from the grave as the evidence that His sacrifice for our sins was accepted and that they are now atoned for. We also believe that the resurrection is proof that Jesus was who He said He was, namely the Son of God. For those who believe, it is a glorious message! "I am the resurrection and the life; he who believes in Me, shall live, even if he dies." ( John 11:25). Happy Easter! | ||
| High frequency trading shakes out weaker gold positions - Phillips Posted: 17 Apr 2014 12:41 PM PDT Julian Phillips discusses recent moves in the price of gold in context of high frequency trading. | ||
| Posted: 17 Apr 2014 12:30 PM PDT
 After six years of monetary and tax policies that could have not been better designed to destroy savings and the savings ethic, you’d think governments might have learned some sort of lesson. They are having none of it. Instead Japan is hell-bent on monetary kamikaze, and the ECB is now warming us up for negative [...] The post Economic Outlook Darkens appeared first on Silver Doctors. | ||
| Gold, Silver and Stalling Economies Posted: 17 Apr 2014 12:20 PM PDT marketoracle | ||
| Posted: 17 Apr 2014 12:19 PM PDT As the month of March posted its final closing print for the S&P (at over 1,880), the equity market participants celebrated five year bull market anniversary (from March '09 to March '14). Ironically, majority of them most likely missed the first few years and have been pilling into the trend as of late. How typical. Conversely, I feel that the opposite course of action might be prudent and here are just a few simple reasons why. Chart 1: This is the second longest bull market in the 80 year history!
Source: Short Side of Long According to historical data, the current US equity bull market is the second longest in the last 80 years and third longest in a 100 year history (as the roaring 20s hold close similarities to the roaring 90s). As we can see in Chart 1, over the last several weeks, the current bull market has edged out the infamous 1982-87 and 2002-07 bull markets in terms of length. A keen student of historical market trends should be able to observe that each and every prolonged bull market (which builds financial and economic excesses) does not usually end with mild correction, but rather serious market re-pricings. In other words, just as majority of the retail investors are becoming confident with stock investing once more (slowly forgetting the lessons of 2008), history shows us that risk increases substantially as the trend ages. Consider the following:
I am not necessarily predicting another monster crash, but what I am trying to put forward is the notion that the longer the bull market goes on for, the higher the excesses become and the more painful the clean out could be on the other side. Chart 2: Annualised return over 5 years has been 3rd best in half century
Source: Short Side of Long As we focus away from the bull market length, and towards the gains achieved, we can see that the current bull market gains also hold very close similarities to previous long bull markets discussed in Chart 1 (to see the zoomed in version of the chart, click here). The chart above shows the 5 year rolling performance for the S&P 500, where gains have now spiked above 170% for only the third time since the 1960s. The first two were into 1987 and 2000 market peaks. The market has gifted investors one of the best 5 year return periods in half a century and history shows us that such periods do not last forever. In the recent article, Bloomberg has described the current bull gains through "annual compounded returns" over 5 years. The article states that S&P 500 has:
I find it ironic that in 2014, majority of Wall Street investment bank research notes state that the current bull market might replicate the gains seen during the late 90s tech bubble… all we have to do is keep buying stocks into the next few years. I guess anything is possible (yes, one day even pigs might fly), but the truth is that the market has already replicated the tech boom by gifting investors 25% annualised returns (including dividends) over the last 5 years. Chart 3: This fifth strongest 5 year performance in over 140 year history
Source: Short Side of Long Instead of just looking at the market from 1960s to present, I took the 5 year rolling performance concept in Chart 2 and applied it to the last 140 years with Robert Shiller's S&P data. The chart shows that gains in excess of 100% during the period of 5 years are 1.5 standard deviations above the historical mean. Interestingly, including the current bull market, there have only been eight events in 140 year history where markets have gifted investors returns in excess of 100% over 5 years. These include gains into the peak of 1882, 1901, 1929, 1937, 1956, 1987, 2000 and 2014 (all marked on the chart above). Out of these eight, seven have led to serious corrections or outright crashes, while one (in 1956) lead to only a mild pull back. In all respect, the bull market in 50s was coming out of a Great Depression and extremely depressed stock valuations (refer to Chart 4). Furthermore, we can see from the chart above, that it makes complete sense to buy equities when the rolling 5 year performance trends below 1 standard deviation away from the mean. Therefore, from the opposite perspective, it would also be outmost prudent to be cautious or even bearish during periods when the equity market trends 1.5 standard deviations above the 140 year historical mean. After all, according to my own analysis, the market has only ever traded at these overextended levels 8.6% of the time or 143 months in the last 140 years. Mind you, outright majority of that was during the late 1990s tech bubble. Finally, since I have already discussed various valuations before, I will not go into it again. However, it is worth stating that Chart 4 shows that this articles conclusion confirms overextended CAPE 10 and other valuation metrics. I believe the US equity market is in a dangerous spot right now. Chart 4: Market is at 3rd most expensive level, beaten by 1929 & 2000!
Source: dShort
The post US Bull Overextended appeared first on The Daily Gold. | ||
| News quiz: Have you heard this? Posted: 17 Apr 2014 12:10 PM PDT The mainstream media has completely ignored the most important stock story of this year... But if you've been reading my DailyWealth Trader service, you've not only heard this story... you've been making good money on it. And there's much more to come… What's the story? I'll tell you in a moment... First, let's review a story the mainstream press has been all over: Over the past 18 months, some of the world's most-watched stocks have skyrocketed... Online retailer Amazon climbed as much as 85%. That was nothing compared with 3D-printing pioneer 3D Systems, which soared 310%. And even 3D's move couldn't match the 657% gain in movie streamer Netflix. Social-media network Facebook climbed 280% since November 2012. Its cousin Twitter nearly tripled from its initial public offering (IPO) in November 2013. These stocks climbed to valuations beyond all reason. Amazon was trading at more than 600 times trailing 12-month earnings. 3D Systems hit 171 times earnings. Facebook at one point last January traded at 1,623 times earnings. And Twitter... Well, Twitter doesn't have positive earnings yet. It lost $645 million in 2013. But it peaked at 75 times annual sales... which is an outrageous number. When valuations are that high, it's hard to imagine a scenario where shareholders are going to make money... except by selling to a "greater fool." And it looks like greater fools are getting scarce... As you no doubt have heard, the "glamour" stocks are falling... hard. What you probably haven't heard about is the price strength in some of the world's greatest companies... You can see what I mean below. Soda- and snack-maker PepsiCo (PEP) is up 9% over the last two months. In DWT, we've traded Pepsi twice this year. We're averaging 3% per trade... 15.6% annualized. Meanwhile, Amazon is down 9%.
Tech-services giant IBM (IBM) is up 3% over the last two months. We've traded IBM three times this year. We're averaging 3.3% returns... 22.8% annualized. Meanwhile, Netflix is down 22%.
Beverage giant Coca-Cola (KO) is up 5% over the last two months. We've traded Coke three times this year. We're averaging 3.5% per trade... 20.4% annualized. Meanwhile, 3D Systems is down 35%.
Newspapers love to write about meteoric rises and gruesome collapses, like we're seeing in the glamour stocks. What they won't write about is a 3% gain in a big, safe, "boring" stock like IBM or Wal-Mart. But if you're looking to build wealth in the market over the long term, this is a much more important story. Stick with trades on stocks that have great brands... that bring in billions of dollars of cash earnings... that have decades-long track records of rewarding their shareholders. This isn't a "sexy" strategy, but it works. If you want cocktail-party conversation-starters, go ahead and buy IPOs at 75 times sales. You might get lucky. But if you want a lifetime of trading success, stick with a proven formula. That's the story I'm writing. Crux note: You can learn exactly what strategy we use to get regular, safe double-digit annual income from blue-chip stocks, right here.
More from Amber Lee Mason: Amber Lee Mason: The Three-Minute Trading Expert Amber Lee Mason: The answer to a BIG question you're probably asking about stocks Amber Lee Mason: A world-class way to profit from the next big rally in silver | ||
| Euro has no future. Maxcoin and Bitcoin do! Posted: 17 Apr 2014 12:04 PM PDT | ||
| Gold Forecast: This is going to be exciting Posted: 17 Apr 2014 11:53 AM PDT Gold market traders should understand that precious metals in general are still months away from breaking out to the upside. | ||
| Posted: 17 Apr 2014 11:23 AM PDT Precious metals Market report by Alasdair Macleod, GoldMoney, Head of Research
The Long Bond yield is leading the way downwards, having broken below the 3.5% level, and the 10-year bond seems set to follow its lead. Eurozone bond yields have also collapsed signalling either outright deflation or possibly, given its proximity to Ukraine, a flight from bank deposits. This week the Ukrainian situation escalated with Russia's Crimean strategy emerging in other eastern cities. Peace talks in Geneva today are not expected to improve things. Meanwhile Washington seems set to escalate financial tensions with Russia, potentially blacklisting businesses and even banks, as well as individual oligarchs. The financial consequences of any such action are bound to concern markets and could become destabilising, risking global economic prospects particularly with a Chinese slowdown. Opinion is divided over the effects on the gold price. In western capital markets there is a widely-held view that a deteriorating economic outlook will provoke a run from commodities into cash, so those who regard gold as only a commodity are bearish but have almost certainly already sold. The four billion Asians who own most of the world's gold take a different view having learned through experience that their currencies collapse instead. This sums up the opposing forces behind the gold price. In futures markets the bets are in favour of shorting, while the Asians continue to buy physical. And this is why yet again, the London gold forward rate (GOFO) went sharply into backwardation last Friday when futures markets forced prices lower. It is even more negative this morning, signalling market strains are still increasing. Prices for gold and silver sold off this week, with gold falling from a high of $1331 to a low of $1286 on Tuesday, and silver went as low as $19.22 at one point. The chart below shows how prices for gold and silver have progressed since the beginning of the year, and it can be seen that silver has been the outright loser. However, as discussed last week, silver's open interest on Comex has been building and is now close to all-time highs at over 164,000 contracts. When the tide turns, silver should be the star performer. Next week Monday. US: Leading Indicator. ends
The post Economies stalling appeared first on The Daily Gold. | ||
| Posted: 17 Apr 2014 11:21 AM PDT Economic Outlook Darkens ___________________________________________________________________
Ends NOTES TO EDITOR For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for retail and corporate customers. Customers can trade and store precious metal online easily and securely, 24 hours a day. GoldMoney has offices in London, Jersey and Hong Kong. It offers its customers storage facilities in Canada, Hong Kong, Singapore, Switzerland and the UK provided by the leading non-bank vault operators Brink’s, Via Mat, Malca-Amit, G4S and Rhenus Logistics. Historically gold has been an excellent way to preserve purchasing power over long periods of time. For example, today it takes almost the same amount of gold to buy a barrel of crude oil as it did 60 years ago which is in stark contrast to the price of oil in terms of national currencies such as the US dollar. GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey’s anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers’ assets with independent audit reporting every 3 months by two leading audit firms. Visit www.goldmoney.com. The post Economic Outlook Darkens appeared first on The Daily Gold. | ||
| Globalist Gangster’s Nevada Land Grab Posted: 17 Apr 2014 11:00 AM PDT
 "Harry Reid, who last week hosted the fifth annual National Clean Energy Summit at the Bellagio Hotel and Casino in Las Vegas, has been "pulling strings behind the scenes" for months on behalf of ENN Mojave Energy, a Nevada subsidiary of the Chinese-owned ENN Group. After more than two years of secret negotiations beginning in [...] The post Globalist Gangster’s Nevada Land Grab appeared first on Silver Doctors. | ||
| Copper is pathological and suffers from SAD, but it has value - Goldie Posted: 17 Apr 2014 10:53 AM PDT Dr. Copper may be in a supercycle, but there are serious problems. Raymond Goldie explains that the base metal acts pathologically and has a bad case of seasonal affective disorder. Gold Report interview. | ||
| Gold, Silver And The Mining Sector: Prepare For A Severe Fall Posted: 17 Apr 2014 10:10 AM PDT marketoracle | ||
| Two More Victims Of The Retail Apocalypse: Family Dollar And Coldwater Creek Posted: 17 Apr 2014 09:45 AM PDT
I was also surprised to learn that Coldwater Creek is closing all of their stores...
I remember browsing through a Coldwater Creek with my wife and mother-in-law just last year. At the time, my mother-in-law was excited about getting one of their catalogs. But now Coldwater Creek is going out of business, and all that will be left of that store is a big, ugly, empty space. Of course the fact that a couple of major retailers are closing stores is nothing new. This kind of thing happens year after year. But what we are witnessing right now is really quite startling. So many retailers are closing so many stores that it is being called a "retail apocalypse". In a previous article entitled "This Is What Employment In America Really Looks Like…", I detailed how major U.S. retailers have already announced the closing of thousands of stores so far this year. If the economy really was "getting better", this should not be happening. So why are so many stores closing? Well, the truth is that it is because the middle class is dying. With each passing day, more Americans lose their place in the middle class and fall into poverty. The following is an excerpt from the story of one man that this has happened to. His recent piece in the Huffington Post was entitled "Next Friday, I'll Be Living In My Car"...
There are millions upon millions of Americans that can identify with what that man is going through. Once upon a time, they were living comfortable middle class lifestyles, but now they will take any jobs that they can get. Just today I came across a statistic that shows the massive shift that is happening in this country. A decade ago, the number of women working outnumbered the number of women on food stamps by more than a 2 to 1 margin. But now the number of women on food stamps actually exceeds the number of women that have jobs. Wow. How could things have changed so rapidly over the course of just one decade? And sadly, things continue to go downhill. Every day in America, more good jobs are being sent out of the country or are being replaced by technology. I really like how James Altucher described this trend the other day...
There is so little loyalty in corporate America these days. If you work for a major corporation, you could literally lose your job at any moment. And you can be sure that there is someone above you that is trying to figure out a way to accomplish the tasks that you currently perform much more cheaply and much more efficiently. Most big corporations don't care if you are personally successful or if you are able to take care of your family. What they want is to get as much out of you as possible for as little money as possible. This is a big reason why 62 percent of all Americans make $20 or less an hour at this point. The quality of our jobs is going down, but the cost of living just keeps going up. Just look at what is happening to food prices. For a detailed examination of this, please see my previous article entitled "Why Meat Prices Are Going To Continue Soaring For The Foreseeable Future". As the middle class slowly dies, less people are able to afford to buy homes. Mortgage originations at major U.S. banks have fallen to a record low, and the percentage of Americans that live in "high-poverty neighborhoods" is rising rapidly...
If nothing is done about the long-term trends that are slowly strangling the middle class to death, all of this will just be the beginning. We will see millions more Americans lose their jobs, millions more Americans lose their homes and millions more Americans living in poverty. The United States is being fundamentally transformed, and very few people are doing much of anything to stand in the way of this transformation. Decades of incredibly foolish decisions are starting to catch up with us, and unless something dramatic is done right away, all of these problems will soon get much, much worse. | ||
| Banking Bail-Ins: Destroy the Depositors Posted: 17 Apr 2014 09:33 AM PDT Bail-ins are a very good thing. Burn the shareholders, and destroy the deposit savers... SO the MONEY LENDERS didn't get thrown out of the temple again this Easter Week, writes Adrian Ash at BullionVault... The Queen of England once more touched a few bag of silver coins...handing useless Maundy money to a small selection of her more aged subjects in an old ceremony... And another, less ancient tradition was upheld by the European Parliament too. Strasbourg's finest voted to confirm the €100,000 level of banking deposit insurance across the 18-nation Euro currency zone. But only that €100,000 limit. Above that, you're on your own. So why the fuss at at cut-and-paste schlock-horror news site ZeroHedge...?
Judging by some readers' comments, you'd think this was an evil plot by government to steal bank savers' money. Yet in truth, all bank accounts carry credit risk. Government meddling actually comes with the "deposit insurance" which the EU just confirmed. The name gives it away. A bail-in is different from a bail-out. As the article says, it means that...instead of taxpayer money being used to rescue failed banks like in 2008..."the bank's owners and creditors will be first in line to absorb losses banks will incur, before outside sources of finance may be called upon." Good. Excellent in fact. If a bank fails, burn the shareholders. Then destroy the creditors. It happens in every other field of business. It should happen to banks, too. For too long, senior bank executives have relied on the promise of taxpayer rescue. So have bank creditors. Meaning you, me and everyone else with cash on deposit. It has made us lazy, and blind to risk. When you put money into the bank, you are lending it. You don't own it anymore. So you are exposed to the bank failing. Or you should be. Yet if you hold up to €100,000 in a Eurozone bank, that money is guaranteed by government. US insurance is $250,000 and in the UK £85,000. Anything above that limit is not guaranteed. This is what the latest votes in Strasbourg confirm, as part of the much scarier "banking union" moves. Forget the phrase "bail in". It's a new buzzword, and a silly one at that, to suggest banking failure might hurt people who aren't involved. Boo-hoo. Creditors are very involved. Money in the bank is exposed to the bank. Fact is, you can either have price risk or credit risk. Yes, you can get one on top of the other (such as nominee brokerage accounts, structured investment products). But you can never escape them both. Make your choice, and know your risks. Physical bullion, owned outright, carries no credit risk. This is why Bullionvault was set up. That's why you don't need or get "depositor insurance" on your gold or silver. Because you are an owner, not a depositor. So yes, you do get price risk alone when you own bullion. But we are not a bank (nor wish to be). So we must use the banking system to receive and return the cash you use to buy. That money is on risk for the bank's solvency. The gold or silver you own isn't exposed to anyone. So if in doubt, buy bullion. Or withdraw excess funds back to your own bank account. Which you will of course have selected after thoroughly studying its risks. Please also be sure to read this Help Page about how Bullionvault cares for unspent client money. Because the risks you take with your money are yours to know and understand. Relying on government to protect you...come what may...is precisely what caused the banking bubble and crash. It is also what will destroy very many savers and investors in the next crash, too. Because governments are now formally, and rightly, telling creditors they are on risk. | ||
| The Doc: Gov’t Planning CYPRUS-Style BAIL-INS! Posted: 17 Apr 2014 09:30 AM PDT
 Over the past 18 months we’ve seen nearly all of the Western nations move to prepare for bail-ins for the next financial crisis. They’re not doing that for no reason- they’re preparing the legislation because they know its coming and they know that bail-outs are no longer an option, so their last ditch effort now [...] The post The Doc: Gov’t Planning CYPRUS-Style BAIL-INS! appeared first on Silver Doctors. | ||
| Big Pictures: Stocks, Gold and the Miners Posted: 17 Apr 2014 09:30 AM PDT Biwii | ||
| Posted: 17 Apr 2014 09:17 AM PDT - Public announcement GEAB N°84 (April 17, 2014) -  In the present confrontation between Russia and the West over the Ukrainian crisis, the image of the Cold War inevitably comes to mind and the media are obviously fond of it. However, contrary to what it gives us to understand, it's not Russia that seeks the return of an iron curtain but really the US. An iron curtain separating the old powers and emerging nations; the world before and the world afterwards; debtors and creditors. And this in the crazy hope of preserving the American way of life and the US' influence over "its" camp in the absence of being able to impose it on the whole world. In other words, go down with as many companions as possible to give the impression of not sinking. For the US, these are the current stakes in fact: drag along the whole Western camp with them to be able to continue dominating and trading with enough countries. So, we are witnessing a formidable operation of turning round opinion and leaders in Europe to ensure docile and understanding rulers vis-à-vis the American boss, supported by a blitzkrieg to link them permanently with the TTIP and to cut them off from what could be their lifeline, namely the BRICS, their huge markets, their vibrant future, their link with developing countries, etc. We are analyzing all these aspects in this GEAB issue, as well as the subtle use of the fear of deflation to convince Europeans to adopt US methods. In the light of the extreme danger of these methods used by the US, it goes without saying that leaving the US ship wouldn't be an act of betrayal by Europe, but really a major step forward for the world as we have already extensively analyzed in previous GEAB issues (1). Unfortunately, the most reasonable European leaders are completely paralyzed and the best strategy that they are still capable of currently putting into effect, in the best case scenario, seems to be simply to delay (2), certainly useful and welcome but hardly sufficient… Layout of the full article: 1. LOWER THE MASKS 2. QUICK A TTIP 3. AN ECONOMIC ABERRATION 4. INSTIL THE FEAR OF DEFLATION IN EUROPE, THE SECOND US WEAPON 5. DEBTORS VERSUS CREDITORS, THE WORLD CUT IN TWO This public announcement contains excerpt from sections 1 and 2. LOWER THE MASKS With the internet and "leak" type issues, keeping a secret has become difficult for secret agents and countries with dirty hands. Besides Snowden's or WikiLeaks disclosures, we have further learned recently that the US was behind a social network in Cuba targeting the destabilization of the government in power (3). We have been able to watch this video opportunely leaked on YouTube (4) showing the Americans at work behind the coup d'état in the Ukraine. Or again, it would seem that they are not innocent in Erdoğan's current destabilization in Turkey (5), a country whose situation we will go into in more detail in the next GEAB issue (6)… The masks are falling… certainly on the evidence, but that nobody can ignore. But the United States is no longer satisfied with developing countries or banana republics… In Europe, they are also managing to turn round the leaders one after the other, so that they obediently follow American interests. It's no longer "what's good for General Motors is good for America" as Charles Wilson (former GM CEO) said in 1953, but "what's good for the US is good for Europe". It already has Cameron, Rajoy, Barroso and Ashton's support… It has succeeded in getting Donald Tusk's Poland's whilst he was strongly resistant at the beginning of his term of office (7), Italy's thanks to Renzi's opportunist coup d'état (8), and France's Hollande/Valls thanks in particular to a ministerial reshuffle and a Prime Minister little suspected of anti-Americanism. Unlike the beginning of his term of office when he played the independence card on Mali or on other fronts, François Hollande seems to be completely submissive to the United States. What pressure has been put on him? As for Germany, it's still resisting somewhat but for how long (9)? We will expand on these remarks in the Telescope. Europe is thus dragged towards US interests that aren't its own, neither in terms of politics, geopolitics, or trade as we will see. Whilst the BRICS have chosen an opposite path and are seeking to withdraw from the henceforth profoundly negative influence of the US at any price, Europe is now being taken for a ride. Evidenced, for example, by Belgium's purchase of $130 billion worth of US Treasuries in three months from October 2013 to January 2040 (latest figures available (10)), being at an annual rate greater than its GDP (11)… It's certainly not Belgium itself which is responsible for this aberration, but Brussels of course, that's to say the EU as a little US soldier. Politically Europe is stifled by the US which can take heart in the absence of any leadership. And the way to permanently seal this American stranglehold over Europe is called the TTIP… QUICK A TTIP We have already amply documented it: unlike the triumphant discussions of "recovery" based on rising real estate prices and the stock exchange which is at its highest, the real US economy is in dire straits. Food shortages are higher than in Greece.  Shops, even good value ones, are closing through lack of customers (12). Demand for real estate loans are at their lowest, which bodes ill for what follows next and presages an imminent reversal, as we anticipated in the GEAB n°81. [...] But as we have already said, this isn't the most important thing. The TTIP's major stake is the Dollar' s preservation in trade and keeping Europe in the US' lap in order to avoid the constitution of a Euro-BRICS bloc able to counterbalance the US. Thus, the Ukrainian crisis, under the pretext of Russian aggression and gas supply, is a good way, in the panic, of imposing the US and the lobbies' agenda in the face of European leaders who are too weak to act. What wasn't expected is that the lobbies' interests are not necessarily going in the direction one thinks… [...] ---------- Notes : 1 And as China, in particular, asks Europe to do via its swap agreements, for instance. 2 Waiting especially for European elections. 3 Source : The Guardian, 03/04/2014. 4 Source : Reuters, 06/02/2014. 5 Following the US' use of social networks in Cuba as previously mentioned, it's not surprising that Erdoğan decided to cut off Twitter in Turkey. Moreover, Fethullah Gülen, founder of the Gülen movement opposed to the Erdoğan government, lives in… the US. Sources : Aljazeera (13/03/2014), Wikipédia. 6 A small digression: our team can't help thinking that if de Gaulle, so admired in France, were in power today, he himself would also be considered as an autocrat to overthrow, like Erdoğan or Putin… Effective leadership in the interest of one's country now seems to be considered incompatible with democracy in its current form, which must be weak… 7 Source : Wikipédia. Donald Tusk is now a fervent shale gas supporter in Poland and rising up against Russia. Sources : Wall Street Journal (11/03/2014), DnaIndia (05/04/2014). 8 Read also RT, 01/04/2014. 9 Source : EUObserver, 10/04/2014. 10 Source : US Treasury. 11 With its trade surplus of about 1% of GDP it will struggle to explain this purchasing power all by itself… 12 See, for example ABCNews, 10/04/2014. | ||
| Guinea gold mine collapse kills at least six - official Posted: 17 Apr 2014 08:31 AM PDT At least six people were killed when a small gold mine mineral-rich Siguiri province caved in on them, a local official said on Wednesday. | ||
| Japan & the US: Money Printing Does Not End Depressions! Posted: 17 Apr 2014 08:00 AM PDT
 After the adjustment of the data for inflation, it is clear that neither the US nor Japanese stock markets are out of their downtrend. They may have stopped falling in real inflation adjusted terms, but as stocks rise, the currency they are denominated in falls at the same time. So the benefit which remains is [...] The post Japan & the US: Money Printing Does Not End Depressions! appeared first on Silver Doctors. | ||
| Paper gold falls in West but premium for real metal jumps in India Posted: 17 Apr 2014 07:31 AM PDT GATA | ||
| Asia takes every ounce West unloads but gold will fall for two years, GFMS says Posted: 17 Apr 2014 07:31 AM PDT GATA | ||
| New report says Obama is "cooking the books" on Obamacare Posted: 17 Apr 2014 07:21 AM PDT From Bloomberg: For several months now, whenever the topic of enrollment in the Affordable Care Act came up, I've been saying that it was too soon to tell its ultimate effects. We don't know how many people have paid for their new insurance policies, or how many of those who bought policies were previously uninsured. For that, I said, we will have to wait for Census Bureau data, which offer the best assessment of the insurance status of the whole population. Other surveys are available, but the samples are smaller, so they're not as good; the census is the gold standard. Unfortunately, as I invariably noted, these data won't be available until 2015. I stand corrected: These data won't be available at all. Ever. No, I'm not kidding. I wish I was. The New York Times reports that the Barack Obama administration has changed the survey so that we cannot directly compare the numbers on the uninsured over time. The changes are intended to improve the accuracy of the survey, being conducted this month in interviews with tens of thousands of households around the country. But the new questions are so different that the findings will not be comparable, the officials said. An internal Census Bureau document said that the new questionnaire included a "total revision to health insurance questions" and, in a test last year, produced lower estimates of the uninsured. Thus, officials said, it will be difficult to say how much of any change is attributable to the Affordable Care Act and how much to the use of a new survey instrument. "We are expecting much lower numbers just because of the questions and how they are asked," said Brett J. O'Hara, chief of the health statistics branch at the Census Bureau. I'm speechless. Shocked. Stunned. Horrified. Befuddled. Aghast, appalled, thunderstruck, perplexed, baffled, bewildered, and dumbfounded. It's not that I am opposed to the changes: Everyone understands that the census reports probably overstate the true number of the uninsured, because the number they report is supposed to be "people who lacked insurance for the entire previous year," but people tend to answer with their insurance status right now. But why, dear God, oh, why, would you change it in the one year in the entire history of the republic that it is most important for policy makers, researchers, and voters to be able to compare the number of uninsured to those in prior years? The answers would seem to range from "total incompetence on the part of every level of this administration" to something worse. Yes, that's right, I said "every level." Because guess who was involved in this decision, besides the wonks at Census? The White House is always looking for evidence to show the benefits of the health law, which is an issue in many of this year's midterm elections. The Department of Health and Human Services and the White House Council of Economic Advisers requested several of the new questions, and the White House Office of Management and Budget approved the new questionnaire. But the decision to make fundamental changes in the survey was driven by technical experts at the Census Bureau, and members of Congress have not focused on it or suggested political motives. Sarah Kliff of Vox says we shouldn't freak out, because these are the numbers that the census collects for 2013, so the change is actually giving us a good baseline. But I'm afraid I'm not so sanguine. As Aaron Carroll says: "It's actually helpful to have a trend to measure, not a pre-post 2013/2014. This still sucks." The new numbers will suffer, to some extent, from the same bias that the old questions suffered from: People are better at remembering recent events than later ones. Quick: On what day did you last get your oil changed? What month was the wedding you attended last summer? If it was in the last few months, you probably know. If it was someone you're not that close to … well, the summer months kind of blend into each other now that you're a grownup, don't they? And what has been happening in the most recent months? A whole lot of change! Policies were canceled, benefits changed, people shifted around their coverage in anticipation of the new law. That doesn't make for a very good baseline. It will be a very good measure of who has insurance right now, in 2014, but it's not where I'd want to start my 2013 baseline for our new law. That's why they should have done this for 2012 – or waited until 2016 – to give us actual comparable data for the transition period. So by your leave, I think I'll continue to freak out for a bit. I find it completely and totally impossible to believe that this problem didn't occur to anyone at Census, or in the White House. It would be like arguing that the George W. Bush administration might have inadvertently overlooked the possibility that when the U.S. invaded Iraq, there would be shooting. This is the biggest policy debate of the last 10 years, and these data are at the heart of that debate. It is implausible that everyone involved somehow failed to notice that they were making it much harder to know the effect of this law on the population it was supposed to serve. Especially because the administration seems to have had a ready excuse as soon as people reacted to the news. Even if the administration genuinely believes this is defensible, why would they give anyone reason to believe that it is cooking the books? Because those charges are being made, and they're a lot harder to dismiss than the complaints about birth certificates or dark intimations that the administration has simply made up its enrollment figures out of whole cloth. I just don't get it. I mean, I can certainly think of explanations, but I can't quite bring myself to believe the worst of them. Which leaves me with the only slightly-less-utterly-appalling conclusion: At some point, very early on in the process, folks noticed that asking the new questions would make it difficult to compare Obamacare's implementation year to prior years, and decided that assessing the effects of the transition wasn't nearly as important as making urgent changes to … questions we've been asking basically the same way for a decade and a half. No, wait, that doesn't make any sense, either. Let's go back to inexplicable, shall we? If the administration is really serious about transparency and data-driven policy, as I've been told for a year now, then it will immediately rectify this appalling mistake and put the old questions back into circulation double-quick. But we're more likely going to hear the most transparent and data-driven administration in history citing these data – without an asterisk – to tout the amazing impact of its policies. To contact the writer of this article: at mmcardle3@bloomberg.net. To contact the editor responsible for this article: James Gibney at jgibney5@bloomberg.net.
More on Obamacare: Meet the doctor who is single-handedly taking down Obamacare. Learn where he can treat you. "Real life" example shows what Obamacare really does to small businesses Doc Eifrig: Finally, a little bit of good news from the Obamacare debacle | ||
| It’s Time to Ditch the Consumer Price Index (CPI) Posted: 17 Apr 2014 07:19 AM PDT So why does the government maintain such a transparently inaccurate and misleading metric? For three reasons. That the official rate of inflation doesn’t reflect reality is obvious to anyone paying college tuition and healthcare out of pocket. The debate over the accuracy of the official consumer price index (CPI) and personal consumption expenditures (PCE–the so-called core rate of inflation) has raged for years, with no resolution in sight.
The CPI calculates inflation based on the prices of a basket of goods and services that are adjusted by hedonics, i.e. improvements that are not reflected in the price of the goods. Housing costs are largely calculated on equivalent rent, i.e. what homeowners reckon they would pay if they were renting their house. The CPI attempts to measure the relative weight of each component:
Many argue that these weightings skew the CPI lower, as do hedonic adjustments. The motivation for this skew is transparent: since the government increases Social Security benefits and Federal employees’ pay annually to keep up with inflation (the cost of living allowance or COLA), a low rate of inflation keeps these increases modest. Over time, an artificially low CPI/COLA lowers government expenditures (and deficits, provided tax revenues rise at rates above official inflation). Those claiming the weighting is accurate face a blizzard of legitimate questions. For example, if healthcare is 18% of the U.S. GDP, i.e. 18 cents of every dollar goes to healthcare, then how can a mere 7% wedge of the CPI devoted to healthcare be remotely accurate? In my analysis, the debate over inflation is intrinsically flawed. What really matters is not the overall rate of inflation, which can be endlessly debated, but the purchasing power of earned income, i.e. wages and the exposure to real-world costs. In other words, those households with zero exposure to college tuition and the full costs of daycare, medical care and healthcare insurance may well experience low inflation, while the household paying the full costs of daycare, college tuition and healthcare insurance will experience soaring inflation. Here’s one example of how CPI fails to capture real-world inflation/loss of purchasing power. Let’s say an employee works for a company or agency that pays his/her healthcare insurance. The monthly cost has risen from $1,000/month to $1,500/month. The employee’s wage has remained stagnant but the total compensation costs paid by the employer have gone up by $500/month. Now the employer shifts that $500/month to the employee as their share of the healthcare insurance cost. Since the average full-time worker earns around $40,000 a year, and pays around 18% in taxes, their take-home pay is around $33,000 annually. The employee’s co-pay of $6,000 a year ($500/month) represents 18% of their take-home wage. This is an 18% reduction in earnings, or the equivalent of 18% inflation (i.e. a reduction in purchasing power). This shifting of the skyrocketing burden of healthcare costs acts the same as 20% inflation, yet it doesn’t even register in the current CPI. The geography of inflation doesn’t register, either. Soaring rents in Brooklyn, NY and the San Francisco Bay Area have a profound effect on those exposed to these rapidly rising costs, yet these impacts are massaged to zero by national CPI calculations. So once again we have a bifurcated society: those protected by the state from rising costs and those exposed to real-world reductions in purchasing power.Households that receive government subsidies and direct payments have little exposure to real-world healthcare costs, since they are covered by Medicaid, and modest exposure to housing if they receive Section 8 benefits (Section 8 recipients pay 30% of their income for rent, regardless of the market price of the rental). Retirees on Medicare also have limited exposure to the real-world costs of their care paid by the government. If we analyze inflation by these two metrics, we find the middle class is increasingly exposed to skyrocketing real-world prices. Pundits in the top 5% have the luxury of pontificating on the accuracy of the CPI while those protected by government subsidies and coverage have the luxury of wondering what all the fuss is about. Only those 100% exposed to the real costs experience the full fury of actual inflation. So why does the government maintain such a transparently inaccurate and misleading metric? For three reasons: 1) it is useful propaganda; 2) it suppresses the state’s cost-of-living increases and 3) it lowers the government’s cost of borrowing. The benefits of reducing COLA adjustments are self-evident, as is the benefit of borrowing money at low rates of interest, but the propaganda benefits are more subtle. The key to enabling the endless printing of money that enriches the banks and the top .1% is low inflation. Asset bubbles can be inflated, ballooning the wealth of the owners of the assets, as long as inflation is near-zero. Indeed, the Federal Reserve claims it must print money to counter low inflation. Meanwhile, in the real economy, those exposed to the real costs of college tuition, healthcare, childcare, etc. are seeing their purchasing power evaporate like a puddle of water in Death Valley. The Fed needs low inflation to justify its continuing enrichment of the financial elite, and the Federal government needs low inflation to keep its COLAs and borrowing costs low. There are two ways to mask real-world reductions of purchasing power: 1) skew the CPI by distorting the component percentages, hedonics and how costs are measured, and 2) protect enough of the populace from real-world increases so they no longer care. Seniors, who famously vote in droves, have no idea what their Medicare benefits actually cost. As a result, they have no experience of healthcare inflation /reduction of purchasing power. This works in all sorts of industries. As I have often mentioned here, the F-35 Lightning fighter aircraft costs in excess of $200 million each, roughly four times the cost of the F-18F it replaces. This extraordinary inflation is not experienced directly by the taxpayer who is paying for the boondoggle, as the Federal government borrows trillions of dollars to pay for such boondoggles, effectively passing the inflated costs on to future generations. These costs are hidden by the low cost of borrowing trillions to pay for boondoggles. If real-world inflation is (say) 5%, then interest rates would typically adjust to a few points above that rate, to compensate capital for the erosion of purchasing power. If the Treasury had to pay 7% to borrow money, the interest cost would soon cripple Federal spending. People would be forced to focus on how all those trillions of dollars are being spent, and to whose benefit. But with borrowing costs so low, nobody cares. The solution? One, abolish the Fed and let the market discover interest rates, and two, abandon the simplistic notion that one number of inflation has any meaning in a complex economy with numerous subsets of exposure to market costs and the loss or gain of purchasing power. Will we muster the will to look past failed models and metrics? Sadly, the answer is no. Why? As I noted yesterday in What’s the Difference Between Fascism, Communism and Crony-Capitalism? Nothing, a system set up to enrich political and financial elites is incapable of reform. the only way the CPI will ever be replaced is when the Status Quo collapses in a heap of lies and insolvency. Until then, propaganda and gaming the system to protect vested interests will rule. | ||
| Use of gold as collateral in China is actually positive for gold, Rule tells KWN Posted: 17 Apr 2014 06:31 AM PDT GATA | ||
| Ukraine Currency Collapses Nearly 70% Against Gold In 4 Months Posted: 17 Apr 2014 06:31 AM PDT gold.ie | ||
| Gold market looks for India to relax import restrictions Posted: 17 Apr 2014 06:06 AM PDT Gold market looks for India to relax import restrictions. | ||
| This is the catalyst for an "Arab Spring" in China... and I'm doubling down... Posted: 17 Apr 2014 06:00 AM PDT From Dan Ferris, editor, Extreme Value: Perhaps you saw the 60 Minutes report last year on newly built "ghost towns" full of homes and office buildings without a single resident. Perhaps you've heard about case after case of corruption and fraud among Chinese public companies. Go to Google and type in "Chinese accounting fraud." You'll get an eyeful. I'm not denying that. In many cases, China has built way too many apartments and other buildings. There are several widely touted failed real estate projects. One of them is the South China Mall in Dongguan, west of Shenzhen. It's the biggest mall in the world, with 7.1 million leasable square feet and room for more than 2,300 stores. But it's still 99% vacant. Another is Thames Town, a town modeled after an English village. It's complete with Chinese guards dressed in red British "Beefeater" uniforms... but no residents or businesses. But keep in mind… the same few empty ghost-town projects are cited in every news story on the topic. It is a problem, just not as big of one as the bears would have you believe. The biggest and most reasonable fear is that a bursting China-wide property bubble will cause social unrest. It's illegal for Chinese citizens to invest outside the country. So they buy apartments. Some middle-class people own five or 10 as investments. I read one news article that suggested if the bubble bursts, China could suffer massive social unrest – much like the "Arab Spring" the Middle East experienced a few years ago. I can hardly believe I'm about to express confidence in any government – let alone a communist, command-and-control government like China's – but it seems the Chinese government is working to avoid such an outcome. It knows there's only one tool powerful enough to conquer the property bubble problem… The country must open up its economy to the outside world much more and much faster. Two recent events tell me that process is already well underway. First, China created a new special economic zone in Shanghai last fall and 12 more in January. Second, one of the largest remaining state-owned companies in China is about to become an investor-owned, publicly traded business… The latest copy of the South China Morning Post dropped in front of my hotel room door in the wee hours of the morning last Thursday. Jet lagged, I heard it hit the floor and immediately retrieved it. The business section headline read: "Citic Pacific to take over assets of parent." Citic Pacific is a publicly traded conglomerate holding company that owns many businesses, from steelmaking to property management. The article said it will acquire its parent company, Citic Ltd, for a combination of cash and shares totaling about $36.2 billion. Citic Ltd was established in 1979 by former Chinese leader Deng Xiaoping to invest outside China in the early days of the country's economic reforms. Today, it's ranked No. 172 on Forbes' list of the world's 500 largest companies. Citic is a sprawling empire. It includes financial businesses like banking, stock brokerage, insurance, asset management, private equity, and equipment leasing. Non-financial operations include property development, infrastructure, construction engineering, natural resources and energy, manufacturing, telecom, and TV broadcasting. This is a watershed acquisition. One of the last big state-owned companies in the country will now be part of a publicly traded company, subject to the laws and reporting requirements in Hong Kong. This is part of a plan to open China's businesses up to more widely accepted standards of financial reporting… hopefully helping to fix the widespread accounting fraud in the country. China is serious about opening itself up faster. It's serious about becoming a freer, wealthier nation. Don't get me wrong here. I don't have blinders on. There are a LOT of bad real estate loans in China. You can't build a bunch of empty buildings without winding up with bad debts. There's even an empty replica of several European cities. It's bizarre. All that emptiness represents seriously flawed, failed investments. The banks who loaned that money will not get it back. But in five to 10 years, I'm willing to bet these problems will be a distant memory and China's new special economic zones – like Qianhai and Shenzhen – will have attracted great wealth and become more prosperous. When everybody hates an asset that will likely be worth much more someday, you could be looking at a major investment home run in three to seven years. Crux note: Dan is always uncovering undervalued companies poised to soar. In fact, he recently discovered a little-known resource company ready to finalize a very lucrative deal. Dan says this transaction could help you "make the safest 400% of your lifetime." To get immediate access to this time-sensitive material, click here now.
More on China: Why China holds the key to gold and copper prices this year This could be the greatest leap to a free market in China since 1978. Unprecedented. We know China wants to displace the U.S. dollar. But now we know how. | ||
| GOFO Rates Plunging- Are We On the Verge of Another Rally? Posted: 17 Apr 2014 06:00 AM PDT
 As expected, London gold forward rates are plunging again during the New York Comex delivery month. In the recent past, this signal of tight physical supplies has correlated with higher prices. So, are we on the verge of another rally? Submitted by T. Ferguson, TFMetals Report: Longtime readers will recall that we first identified this [...] The post GOFO Rates Plunging- Are We On the Verge of Another Rally? appeared first on Silver Doctors. | ||
| Posted: 17 Apr 2014 05:30 AM PDT Ukraine currency collapses nearly 70 percent against gold In four months. | ||
| Jim Willie: Fed Has Lost Control, Systemic Failure Flashing Warning Signals Now! Posted: 17 Apr 2014 05:12 AM PDT
 The US Federal Reserve has been printing money since 2011 to cover USGovt debt securities in a frenetic manner. They have lost control. They call it stimulus, when it is actually the opposite. It does assist the speculators with nearly zero cost money to borrow, but one must be a club member to win loan [...] The post Jim Willie: Fed Has Lost Control, Systemic Failure Flashing Warning Signals Now! appeared first on Silver Doctors. | ||
| Ukraine Currency Collapses Nearly 70% Against Gold In 4 Months Posted: 17 Apr 2014 05:11 AM PDT The charts below gives an indication as to the terrifying magnitude and speed of the recent decline in the value of the currency. Year to date, Ukraine's national currency has collapsed by 69% against gold in less than four months. This has resulted in the cost of food, fuel and basic staples surging for ordinary people in Ukraine. Today's AM fix was USD 1,299.25 EUR 937.48 & GBP 771.89 per ounce. Gold rose $0.20 or 0.015% yesterday, closing at $1,303.10/oz. Silver gained $0.05 or 0.25% yesterday to $19.67/oz.
Gold traded near $1,300 an ounce, set for a weekly drop, as investors weighed tentative signals of a U.S. recovery against the risk of conflict in Ukraine and geopolitical tension. Silver, platinum and palladium are all marginally lower. Prices reversed losses after Ukraine accused Russia of fueling terrorism in its eastern provinces. The metal is 1.3% lower this week and may snap a two-week advance. However, shorts will be nervous heading into a long holiday weekend with the potential for headline risk. Gold bullion should be higher as the dollar is under pressure after Federal Reserve chief Janet Yellen yesterday reiterated that ultra-accommodative monetary policies will continue. This will manifest in interest rates staying near zero percent and continuing currency debasement. Gold consolidated yesterday around the 200-day simple moving average and found some support around $1,297/oz, the 61.8% retracement of gold’s rise in April. Assets in the largest gold-backed exchange-traded product sank the most this year. New York’s SPDR Gold Shares, reported outflows of 8.39 tonnes on Wednesday, the largest one day decline in its holdings since December 23. That has erased almost its entire inflow for the year, with its holdings currently at 798.4 tonnes, against 798.22 on December 31. Gold in euros continues to consolidate around the €1,000/oz mark and looks set to rise in the coming months. The euro's strength is not merited given the appalling fundamentals of Italy, Spain, Portugal and Greece. As soon as the Eurozone debt crisis rears its ugly head again, and it will, gold will again protect against euro weakness.
The euro, the dollar and the pound have been three of the stronger currencies in the world in recent months which has curtailed gains in precious metals in these currencies. This has not been the case for emerging market currencies many of which have fallen sharply and gold has risen correspondingly in value. Thus, gold has again acted as a safe haven for millions of investors and savers around the world and protected them from the declining value of fiat currencies. GOLD IN UKRAINE CURRENCY SURGES ANOTHER 7% THIS WEEK – COLLAPSE CONTINUES This is particularly evident in Ukraine where the economy is nearing collapse and the currency is in free fall. The Hryvnia has been the world's worst performing currency in 2014. The charts below gives an indication as to the terrifying magnitude and speed of the recent decline in the value of the currency. This week alone the currency has fallen by 7% against gold or gold per ounce has risen from 15,669 hryvnia per ounce at open on Monday to 16,880 hryvnia per ounce today.
Year to date, gold in hryvnia has surged by 69% from 9,992 per ounce to 16,880 per ounce or to put it more correctly, Ukraine's national currency has collapsed by 69% against gold in less than four months. This has resulted in the cost of food, fuel and basic staples surging for ordinary people in Ukraine. People are buying gold, silver, other hard tangible and income generating assets.
Once again, the lucky few who own physical gold are being protected from the currency collapse. They are in a position to buy food, water, property, land, businesses and other income generating and life sustaining essentials. Thereby, once again showing the lack of knowledge and sometimes simple bias of those who claim that gold is not a safe haven and discourage investors from owning even a small allocation to gold. Gold is protecting people and companies in Ukraine today and will do the same for people and families in other countries in the coming months and years. Singapore is now one of the safest places in the world to store gold - Essential Guide To Storing Gold In Singapore | ||
| Posted: 17 Apr 2014 03:55 AM PDT Monetary Policy and the Economic Recovery Chair Janet L. Yellen At the Economic Club of New York, New York, New York
Out of Ammo? The Eroding Power of Central Banks Der Spiegel Income Inequality Institute Will Pay Paul Krugman $25,000 Per Month [!] Gawker (nycTerrierist). Make up your own jokes! Michael Bloomberg: ‘I Have Earned My Place in Heaven’ National Journal Jack Halprin: As a Google Attorney, I Need the Homes of 7 Teachers, and Here’s Why SF Weekly NY attorney-general subpoenas high-frequency traders FT. Dems fake left for the midterms. Amid budget shortfall, University of Maine System administrator received $40,000 raise this year Bangor Daily News. Ahem. U.S. States Revive Debtors' Prisons FDL Bank of America’s mortgage crisis costs become a recurring problem Reuters Bitcoin exchange Mt. Gox says ‘no prospects’ for restart of business LA Times GM Move to Freeze Lawsuits May Cut Customer Payouts by Billions Bloomberg Google shares dip as earnings disappoint FT IBM Sales Fall Again, Pressuring Rometty's Profit Goal Bloomberg BlackBerry’s meltdown sparks start-up boom in Canada’s Silicon Valley Reuters Ukraine
ObamaCare
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Phatra Securities analysis of the political situation Asian Correspondent Chinese Mistress's 'Confession' Kicks Off Internet Furor Asia Sentinel Finland celebrates homoerotic art with mustachioed stamps The Verge Unfinished Business Complicates Hillary Clinton's Diplomatic Legacy Times When Did Men’s Income Peak? Demo Memo The eastern United States: A lonely cold pocket on a feverish planet WaPo The World According to Modern Monetary Theory The New Inquiry Karl Polanyi Explains It All The American Prospect Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens Perspectives on Politics, Fall 2014 (forthcoming)
Antidote du jour:
See yesterday’s Links and Antidote du Jour here. | ||
| Gold trades below $1,300 an ounce Physical buying picks up Posted: 17 Apr 2014 03:35 AM PDT Lower gold prices have caught the attention of participants in physical markets, but buyers seem tentative to participate in size for now despite recent dips below $1,300 an ounce, said Swiss bank UBS. | ||
| Gold Import Curbs Seen Continuing in India to Help Currency Posted: 17 Apr 2014 02:21 AM PDT "What they do, are instructed to, will determine prices going forward" ¤ Yesterday In Gold & SilverThe gold price sold off $5 or so during early Far East trading, but had gained it all back by shortly after 9 a.m. in London---and after that the price didn't do a thing until the Comex open. The rally that began at that point got dealt with in the usual manner less than 15 minutes later---and that was it for the remainder of the Wednesday trading session. The lows and highs aren't worth the effort of looking up. Gold closed in New York at $1,302.20 spot, down 20 cents from Tuesday's close. Volume, net of May, was around 127,000 contracts. Naturally enough, the silver price got manhandled the most of all four precious metals. The silver price hit its low of the day about 30 minutes before the London open---and the rally that began shortly before the Comex open got dealt with in the usual manner as well---and at the exact same time as the tiny rally in gold got put in its place. After that, the silver price traded pretty flat. The CME Group reported the low and high ticks as $19.325 and $19.805 in the May contract, an intraday move of well over 2%. Silver closed yesterday at $19.63 spot, up 7 cents from Tuesday. Volume, net of roll-overs, was 30,500 contracts. Platinum didn't do much yesterday---and palladium closed up a bit over a percent. Here are the charts. The dollar index closed late on Tuesday afternoon in New York at 79.79---and after flopping around a bit on either side of unchanged on Wednesday, finished the day at 79.83. Nothing to see here. The gold stocks opened up a bit, but there was someone there to happily sell them down---and they never saw positive territory again, although they finished off their lows, as the HUI closed down "only" 1.00%. I spoke with John Embry yesterday---and we're both of the opinion [and have always been] that the precious metal equities are almost as managed as the metal prices themselves. And despite the fact that the silver price did much better, that didn't help the silver equities one bit, as Nick Laird's Intraday Silver Sentiment index closed down another 1.47%. Over at the Comex-approved depositories they reported that 76 gold and one silver contracts were posted for delivery on Friday within the Comex-approved depositories. The largest of the short/issuers was Jefferies once again---and the two biggest long/stoppers were the two usual suspects, JPMorgan and Canada's Scotiabank. Between them, they stood for delivery on 65 contracts. The link to yesterday's Issuers and Stoppers Report is here. The GLD ETF had a monster withdrawal yesterday, as 269,731 troy ounces were removed. What the bullion banks giveth, they can also taketh away---and they did. GLD is now back at the same level it was at the beginning of 2014. And as of 9:27 a.m. EDT, there were no reported changes in SLV. Over at Switzerland's Zürcher Kantonalbank for the period ending 14 April, they reported a smallish increase in their gold ETF of 6,211 troy ounces. That's the first increase since February 7. Their silver ETF went in the other direction, as 64,752 were removed. The U.S. Mint had another sales report yesterday. They sold 2,500 troy ounces of gold eagles---1,500 one-ounce 24K gold buffaloes---200 platinum eagles---and 50,000 silver eagles. There wasn't a lot of activity at the Comex-approved depositories on Tuesday. Once again, there were no reported in/out movements in gold---and in silver, a smallish 170,873 troy ounces were removed. The link to the silver activity is here. I don't have a large number of stories for you today, but some of them are definitely worth reading. ¤ Critical Reads Path to Extinction: Only Three US Companies Still Have AAA Credit Ratings Their numbers have been dwindling for years, and now only three U.S. companies have the coveted AAA credit rating from Standard & Poor's.  Yellen: Fed Stimulus Still Needed for Job MarketFederal Reserve Chair Janet Yellen said Wednesday that the U.S. job market still needs help from the Fed and that the central bank must remain intent on adjusting its policy to respond to unforeseen challenges. In her first major speech on Fed policy, Yellen sought to explain the Fed's shifting guidance on its interest-rate policy, which at times has confused or jarred investors. She said the Fed's policies "must respond to significant unexpected twist and turns the economy may make." "Thus far in the recovery and to this day, there is little question that the economy has remained far from maximum employment," Yellen told an audience at the Economic Club of New York. She said the Fed's forecast for moderate growth has changed little since last fall despite the severe winter. Fed officials still see only a gradual return to full employment over the next two to three years, Yellen said. This AP news item was picked up ABC News yesterday---and it's the second offering in a row from Elliot Simon.  Spain ETF Grows as Rajoy Attracts Record US InvestmentsThe iShares MSCI Spain Capped ETF attracted almost $238 million in the period ended April 11, the most for any country, according to data compiled by Bloomberg going back to 2002. Traders have poured money into the exchange-traded fund every week in 2014. The $1.9-billion ETF tracking companies from Banco Santander (SAN) SA to Telefonica SA has gained 5.3% this year, compared with declines in the Standard & Poor’s 500 Index and the Stoxx Europe 600 Index. Confidence is growing that Prime Minister Mariano Rajoy will make good on his pledge to complete an overhaul of Spain’s economy as the nation that sought a bank bailout in 2012 returns to growth. A manufacturing report this month pointed to the fastest expansion since at least April 2011, and lenders from Santander to Banco Popular Espanol SA (POP) are benefiting from European Central Bank President Mario Draghi’s policy to keep interest rates at a record low. This longish Bloomberg article, filed from London, was posted on their Internet site late yesterday morning MDT---and that makes it three in a row from Elliot Simon.  Regional Unemployment Highest in SpainOver two dozen regions throughout the Union have an unemployment rate twice the EU average. The data, published on Wednesday (16 April), by the EU’s statistical office Eurostat, says the jobless rate in 27 regions in 2013 was higher than 21.6%. Thirteen are found in Spain, 10 in Greece, three in the French Overseas Departments, and one in Italy. Five of the worst affected are found in Spain alone. This story, filed from Brussels, showed up on the euobserver.com Internet site yesterday morning---and it's the first offering of the day from Roy Stephens. Eurozone Inflation Stuck in "Danger Zone," Keeps Pressure on the ECB A shock drop in March eurozone inflation to its lowest level since November 2009 was confirmed on Wednesday, keeping pressure on the European Central Bank to intervene should prices not rebound.  Out of Ammo? The Eroding Power of Central Banks Since the financial crisis, central banks have slashed interest rates, purchased vast quantities of sovereign bonds, and bailed out banks. Now, though, their influence appears to be on the wane with measures producing paltry results. Do they still have control? EU Countries to Boost Defence Budgets in Light of UkraineMilitary chiefs have said the Ukraine crisis is a “wake-up call” for E.U. countries’ defence spending, as the US backed Ukraine’s use of force in eastern regions. Speaking to press after a regular meeting of E.U. defence ministers in Luxembourg on Tuesday (15 April), the deputy chief of the EU’s external action service, Maciej Popowski, said: “We’ve had 70 years of peace now [in Europe], but we see that power politics is back with a vengeance, so it’s a wake-up call and now we need to get serious about defence.” He noted that “this was the feeling around the table” at the Luxembourg event. He added that E.U. foreign relations chief Catherine Ashton told the ministers: “If Ukraine is not a trigger to get serious about spending, about pooling and sharing, about smart defence, then what more do we need to get real?” Blah, blah, blah. I'll be amazed if this amounts to anything more than talk. This "news" item was posted on the euobserver.com Internet site yesterday morning Europe time---and I thank Roy Stephens once again for sending it our way. Six Ukraine/Russia-Related Stories 1. Practice for a Russian Invasion: Ukrainian Civilians Take Up Arms: Spiegel Online 2. Ukraine crisis---Military column "seized" in Kramatorsk: BBC 3. Dozens of Ukrainian troops surrender APCs in Slavyansk, refuse to "shoot at own people": Russia Today 4. Kiev wants to spark war between NATO and Russia: Russia Today op-ed 5. E.U. spy chief rules out Russian military presence in Ukraine: Russia Today 6. Kiev military op in eastern Ukraine LIVE UPDATES: Russia Today  Three King World News Blogs 1. Grant Williams: "Remarkable Road Map From $5,000 to $20,000 Gold" 2. Eric Sprott: "Crisis, Gold---and an Incredible Opportunity No One is Looking At" 3. David P: "One of the Greatest Opportunities in More Than a Decade"  Scientists Verify World's Largest Single Crystal Piece of GoldScientists at Los Alamos National Laboratory in the U.S. have confirmed a 7.68 oz (217.78 g) piece of gold is in fact a single crystal, increasing its value from around US$10,000 to an estimated $1.5 million. The specimen, the largest single crystal piece of gold in the world, was discovered in Venezuela decades ago, but it is only by using advanced probing instruments that experts can now verify its authenticity. Gold found in the ground will generally have a polycrystalline structure, meaning it is made up of many crystallites, varying in shape and size. Gold of a mono-crystalline structure, where the material is unbroken, are rarer and of significantly higher value. The US-based owner provided geologist John Rakovon with four gold specimens, hoping to determine whether they were of a polycrystalline or mono-crystalline structure. This very interesting news item, complete with an embedded video, showed up on the gizmag.com Internet yesterday---and my thanks go out to Saskatoon, Saskatchewan reader Marvin Weiler for bringing it to my attention---and now to yo | ||
| Posted: 17 Apr 2014 02:21 AM PDT Three King World News Blogs 1. Grant Williams: "Remarkable Road Map From $5,000 to $20,000 Gold" 2. Eric Sprott: "Crisis, Gold---and an Incredible Opportunity No One is Looking At" 3. David P: "One of the Greatest Opportunities in More Than a Decade" | ||
| Scientists Verify World's Largest Single Crystal Piece of Gold Posted: 17 Apr 2014 02:21 AM PDT Scientists Verify World's Largest Single Crystal Piece of Gold Scientists at Los Alamos National Laboratory in the U.S. have confirmed a 7.68 oz (217.78 g) piece of gold is in fact a single crystal, increasing its value from around US$10,000 to an estimated $1.5 million. The specimen, the largest single crystal piece of gold in the world, was discovered in Venezuela decades ago, but it is only by using advanced probing instruments that experts can now verify its authenticity. Gold found in the ground will generally have a polycrystalline structure, meaning it is made up of many crystallites, varying in shape and size. Gold of a mono-crystalline structure, where the material is unbroken, are rarer and of significantly higher value. The US-based owner provided geologist John Rakovon with four gold specimens, hoping to determine whether they were of a polycrystalline or mono-crystalline structure. This very interesting news item, complete with an embedded video, showed up on the gizmag.com Internet yesterday---and my thanks go out to Saskatoon, Saskatchewan reader Marvin Weiler for bringing it to my attention---and now to yours. If you don't read the article, you should at least look at the picture. | ||
| How Marriage Is Keeping Gold’s Prospects Bright in China Posted: 17 Apr 2014 02:21 AM PDT  How Marriage Is Keeping Gold's Prospects Bright in China Last year was a big one for gold in China. As Chinese middle-class families, particularly aunties, bought up gold bars and jewelry for their use as accessories as well as investments, China became both the number-one producer and consumer of the precious metal—surpassing even India where yearly bullion demand had long been the world’s highest. This year, with prices up of gold up, a government campaign against conspicuous spending by officials, and financial reforms designed to increase the availability of other investment opportunities, a new report from the World Gold Council predicts that demand for the metal won’t be as strong as last year. But there’s one segment of the market that has and should continue to underpin China’s appetite for gold—newlyweds and the people who want to wish them well. This short, but rather interesting gold-related article showed up on the qz.com Internet site on Tuesday---I found it posted over at the Sharps Pixley website---and here's another article on the same subject from the mining.com Internet site. | ||
| Gold Import Curbs Seen Continuing in India to Help Currency Posted: 17 Apr 2014 02:21 AM PDT Gold Import Curbs Seen Continuing in India to Help Currency India, the world’s second-largest gold consumer, will probably keep restrictions on imports to control the current account deficit and defend the rupee, said the managing director of the country’s biggest refiner. The limits would result in shipments of 650 metric tons to 700 tons in the 12 months started April 1 from 650 tons a year earlier, according to Rajesh Khosla at MMTC-PAMP India Pvt. Purchases were 845 tons in 2012-2013, the finance ministry says. While the form of restrictions may change, the government will continue to restrain buying, he said in an interview. India represented about 25% of global demand in 2013, the World Gold Council says. Prime Minister Manmohan Singh requires importers to supply 20% of purchases to jewelers for export and sell 80% on the local market. Singh also raised import taxes and only allows banks and government-nominated entities to ship in gold. The new finance minister may review the rules after elections in progress now. This news item, filed from New Delhi, was posted on the Bloomberg website just before midnight last night Denver time---and it's another story that I "borrowed" from the Sharps Pixley Web site. | ||
| India’s Gold Demand Surges as Supply Declines Posted: 17 Apr 2014 02:21 AM PDT India's Gold Demand Surges as Supply Declines Amidst high import duties, the gold demand in India likely to stay high in this year. Last year, India consumed 975 tons and it expects to be between 900 and 1,000 metric tons in 2014. According to the World Council, last year China overtook India as the biggest consumer of gold in the world and both countries seem to want more gold for further days. As per the report, India’s current account deficit was narrowed by the stringent import restrictions over the last year whereas the gold smuggling increased, approximately 200 tons of gold. The customs department seized less than 1% of smuggled gold in the last year. This very short gold-related news item, filed from Mumbai, showed up on the metal.com Internet site in the wee hours of the morning British Summer Time [BST]. It's another story I found over at the sharpspixley.com Internet site just after midnight Denver time [BST-7]. | ||
| India's Pain Is UAE's Gain - Indian Expats Buy Up Gold Jewellery Posted: 17 Apr 2014 02:21 AM PDT  India's Pain Is UAE's Gain - Indian Expats Buy Up Gold Jewellery If any nation is happy about India's gold import curbs it is the UAE, where bullion traders are registering brisk sales given the restrictions on the import of the precious metal in India. The curbs on gold in India have raised demand for gold and diamond-studded gold jewellery among expatriate Indians and visitors from India to the UAE. "The UAE’s gold trade has become the de facto beneficiary of the Indian government’s tough stance on domestic consumption. There is almost a 16% difference on a per gram basis, in buying gold ornaments in the UAE as compared to buying gold in India," said an official at a store in Dubai's gold souk. This interesting, but not surprising story, was posted on the mineweb.com Internet site yesterday---and it's worth reading. | ||
| Lawrence Williams: Jansen Sticks By China Gold Demand Figures Posted: 17 Apr 2014 02:21 AM PDT Lawrence Williams: Jansen Sticks By China Gold Demand Figures There has been a considerable amount of disagreement over China’s real gold demand figures – with some of the differences being accounted for by what is actually being included in the varying estimates, with different analysts coming up with figures between around 1,100 tonnes from organisations like GFMS to over 4,000 tonnes from Alasdair Macleod of Gold Money. While the 1,100 tonne estimates seem on the face of things to be unaccountably low given some of the published statistics on known Chinese imports, the Macleod figures seem unaccountably high. Somewhere in the middle comes the detailed analyses from China gold watcher Koos Jansen as published on his In Gold we Trust website, and he has now put out a detailed response confirming his own figures and commenting that Macleod’s high figures include unintentional double counting – and given that Chinese sources for this information can be confusing and contradictory, this is not too surprising! This commentary by Lawrie is definitely worth reading---and it was posted on the mineweb.com Internet site sometime yesterday. | ||
| 'I invested in gold three years ago and lost 70pc - should I sell?' Posted: 17 Apr 2014 02:20 AM PDT Both the bullion price and gold mining shares have suffered significant losses since 2011. Time to sell?  This posting includes an audio/video/photo media file: Download Now | ||
| General Mills Opens New Frontier in Denying Consumers Right to Sue: Just Use Its Products Posted: 17 Apr 2014 01:47 AM PDT We have just moved beyond an event horizon as far as the corporate version of neo-feudalism is concerned. Remember that one of the salient qualities of feudalism was that the nobility had far more rights than the peasants. By contrast, one of the hoary old notions of jurisprudence is equality before the law. That doesn’t serve our corporate-overlords-in-the-making too well. Subverting jurisprudence over time via inculcating pro-business thinkings through the law and economics movement apparently isn’t good enough for them; they want even higher odds of favorable outcomes. One of them is sneakily getting customers to relinquish their right to sue via getting them to agree to be subject to binding arbitration. This requirement has long been in place as a condition of getting a securities brokerage account. Although it is difficult to prove, many securities brokerage customers feel that they don’t get the restitution which they deserve through this process (and one might cynically observe that that is a feature, not a bug). Some arbitration forums have been so clearly biased as to lead attorneys general to sue. For instance, as described by Martin & Jones:
In other words, arbitration forums can all too easily become privatized kangaroo courts. And even when generally well-run arbitration panels have serious shortcomings in process, challenging the results of arbitration due to arbitrator bias rarely succeeds. Heretofore, binding arbitration clauses have been limited to cases where a consumer enters into a contract with a service provider, such as a credit card issuer or a cell phone company. But General Mills is trying to prohibit consumers from suing based on penny-ante benefits and even mere contact. From the New York Times:
Yves here. Since when is liking a product a benefit to the consumer??? It’s a benefit to the merchant. That alone gives you an idea of what an overreach this is. Back to the article:
And it turns out that the reason General Mills is so keen to shield itself from litigation is that it has repeatedly engaged in deliberately dishonest product labeling, and apparently intends to keep up this profitable form of consumer fraud:
So here’s a simple answer. Don’t buy anything made by General Mills. And encourage everyone you know to do the same. This is a list of their brands:
Please circulate this post widely. Thanks! | ||
| Gold hovers above support at $1295 (S1) Posted: 17 Apr 2014 01:20 AM PDT invezz | ||
| How Silver is Making a Slow Recovery in 2014 Posted: 17 Apr 2014 01:17 AM PDT This article is submitted by Emma Thomson. After 2013's volatile year for silver and gold prices, investors are watching the price per ounce of the two metals carefully. Much has been made of gold's crashing prices, but silver also dropped more than a third (36%) in 2013 from $30 per ounce to less than $20. At the start of this year, analysts were divided over silver's prospects for 2014. A quarter of the year in and silver has yet to really pick up, still hovering around the $20 mark, while gold has recovered from the end of 2013 and is up nearly 17%. So why is silver lagging behind, and can it make a full recovery this year? US inflation rocks the boatInflation in the US has boosted the price of gold in an upwards trend that is likely to continue for the rest of the year. However, uncertainty in the US economy as a whole is having a positive impact on the price of both gold and silver. This nervousness has been sparked by a number of factors influenced by the US government. Firstly the US Federal Reserve has announced that it will reduce its quantitative easing program; although this is a response to the growing economy this action is likely to have a negative impact in the short term on the stock market as uncertainty increases. It is likely that investors will ward off this uncertainty by buying gold and silver, pushing the price of these investments up this year. Secondly, the US Labor Department has announced that jobless claims have dropped to their lowest point in seven years, pointing to increased recovery in the US employment market and the economy. Again this led to stock markets tumbling on April 10, and in response silver prices rose 2% before closing at $20.14 an ounce. In addition to these factors, as the US economy grows, industrial demand for silver could also pick up meaning more investors will turn to the metal as a safe place for their money. European tensionsIt's not just the US economy which impacts silver prices. Tensions between Russia and Ukraine over the last few months have affected both gold and silver prices. Uncertainty in the area has led to investors putting their trust in traditionally solid buys such as silver and gold, in search of better protection should war break out. It seems unlikely that the conflict will develop any further at the moment, but investors are seeking out safe places just in case an international incident breaks out. Demand from emerging marketsStrong emerging markets such as China and India will always have an impact on gold and silver. Asian markets, with their cultural appreciation of gold, will always boost the growth of gold prices regardless of the situation in the rest of the world. Perhaps more surprisingly, both China and India are also increasing the amount of silver they are importing, with Indian demand for silver increasing to such an extent last year that market analysts expect prices to rise if demand from emerging markets continues on the same scale. Supply issuesThe dip in gold and silver prices in 2013 was in part attributed to the lack of supply in gold which caused uncertainty in the traditionally solid buy. While shipments from Africa and China have meant that investors are confident there will be enough gold bullion for trading this year, silver is less in demand. Silver mining costs in 2013 just about equaled the price per ounce, making it unprofitable for mine owners. If the price stays below the cost of production, it's likely that supply will soon fail to keep up with demand. As the amount of available silver drops, this in turn will push up the prices towards the end of the year. Is 2014 a good time to invest in silver?With silver prices looking to recover somewhat in 2014, led by the buoyant US economy, European uncertainty and steady demand from emerging markets, investors would be wise to consider silver in the next 12 months. There are a number of ways to invest in silver, with one of the most popular ways to access the market through Exchange Traded Funds (ETF). This is suitable for investors who want exposure to the market but don't want to have silver in their possession, either because of convenience or security concerns. By taking financial advice from a specialist broker, investors can trade in the same way as equities and buy shares in a silver bullion trust. Alternatively, buying silver remains popular as 2013 saw the largest increase in demand for jewelry in 16 years. If possessing the physical metal is part of the attraction of silver, then silver bullion is widely available, although it must obviously be securely stored and insured, and it will need to be converted back into cash when sold. Another option is to buy shares in silver mining stock. Some knowledge of markets could be valuable in this situation but this will often yield the greatest capital returns. Add silver to your portfolioWhichever option you choose, following the gold and silver price per ounce is an easy way to monitor your investment. With both precious metals looking to make a recovery this year, 2014 could be a great time to add silver to your portfolio.
ReferencesWhere are silver prices headed in 2014 after dreadful 2013 Accessed April 13, 2014 | ||
| Fort Knox Looted of 7,000 Tons of Gold in 1973-1974 says 1981 Article! Posted: 17 Apr 2014 12:53 AM PDT Charleston Voice | ||
| When Will Big Business Figure Out That the Education-Industrial Complex is Eating its Lunch? Posted: 16 Apr 2014 11:21 PM PDT Yves here. This post points out how parochial Corporate America has become in its looting. Look at how some not-very-large changes in approach would leave those fat cats much better off! And they wouldn’t be so terrible for the rest of us either. By J. D. Alt, author of The Architect Who Couldn't Sing, available at Amazon.com or iBooks. Originally posted at New Economic Perspectives. The Washington Post recently reported that Day Care now costs more—in 31 U.S. states—than a college education. In a fit of logic rarely exhibited in today's journalism, the article explains that since it takes the average family eighteen years to save enough for a child's college education, that same child now needs to start saving for his or her own children's Day Care beginning at age eight. The article didn't mention—I suppose because they thought it was obvious—that this necessity is against America's child labor laws. And, of course, Little League Baseball would be devastated. Please consider for a moment the existential dilemma posed by this logical absurdity—and what it says about the American free-enterprise system we're so genuinely proud of. What's great about America is that everyone has the chance to earn a good life for themselves. All that's needed is to get a good job to earn the money to pay for the things that make a good life. Once you get that job you can start earning your good life. America's Catch 22, however, is that you've got to earn that good job before you can start earning your good life. The education required to get a good job—beginning with the pre-school day care that prepares you to succeed in public school so you can then qualify to pay for college or culinary or auto-mechanic school—that education package is the first "commodity" your good life requires you to buy. As already noted, the American free-enterprise system gives this "education commodity" a price tag that takes the average family about eighteen years of earnings to set aside for. If you're lucky enough to have a functional family that can earn and save for you, by the time you're eighteen you should have enough to meet college tuition payments. Except now we realize there's a good chance you might not have graduated from high school because your mom couldn't afford the pre-school day care that might have taught you the early reading and learning skills that would have gotten you off to a running start in second and third grade, but without which you struggled, fell behind, and finally decided that school itself was for the birds because you couldn't learn anything no matter how hard you tried, and it was easier just to be cool, although that, in itself, was a challenge that seemed to require buying things, which you couldn't do since you couldn't earn because you had no hope, really, of getting a job—so you might have been forced to take up shoplifting or petty burglary or worse, just to be cool, because if you couldn't get an education and therefore a job so you could earn money to buy things to create a good life, the only thing left to strive for was just to be cool. And meanwhile, the rest of us are having to pay good tax dollars to catch you, prosecute you, and incarcerate you, which simply transforms you irrevocably into an angry human being whose chance at earning a good life has been utterly destroyed and wasted. Even luckier, your mom decides to stay home during your formative cognitive years so she can read you storybooks on the sofa, and help you play alphabet building blocks on the carpet. Except, in that case, she hasn't been able to earn anything in the free-enterprise system enabling her to put aside for your college tuition, and so—even though you really excelled in public school and are all excited about going on to university—there's no money to buy the tuition with, in which case you become a customer of one of the more lucrative operations in the American free-enterprise system (the student loan business) and borrow the dollars for your college tuition, which means that when you finally graduate and get that good first job and start earning, a substantial portion of what you earn will have to go towards paying off your $29,000 student debt instead of buying the things for your good life. If you happen to marry someone in the same boat, your young, starting out family now has a combined debt of nearly $60,000—and you haven't even bought anything yet! Which you won't be doing anytime soon, either, because not only do you have pay back the $60,000 (plus interest and penalties) you have to start saving immediately for the day care expenses for your future toddlers (what else did you get married for?) which you'll be forced to incur because staying home to read them storybooks is not an option since it's going to take all of two incomes to pay off your college debt while at the same time saving for your kid's future college tuition. And what if you're not even lucky enough to have a functional family? The point could be made that it's surreally illogical that a nation whose free-enterprise system is based entirely upon its citizens being able to earn Dollars would so intentionally hinder and hamper their ability ever to do so. If the free-enterprise system were viewed as a business itself, and it had one of those "old time" CEOs—the ones who genuinely wanted to guide their business toward a path of sustainable profits instead of short-term, bonus-generating revenues—it would seem self-evident that the VERY FIRST thing that CEO would insist upon is that every citizen, as soon as they are issued a birth-certificate, is enrolled in a very focused, comprehensive and absolutely FREE educational process (beginning with pre-school, early-learning day care, and continuing all the way through college or trade-school) the goal of which (obviously) is to generate as many citizen-earners as possible. The business motto would be "Every lost citizen-earner is a lost free-enterprise customer!" And the very first act of the new FREE education process would be the immediate pay-off all existing student debt. No doubt there would be some board members of Free-Enterprise Inc. (FEI) who would raise the following objections:
To which the CEO might reply:
It would take a full generation for the CEO's business strategy to produce the substantial results he (or she?) is envisioning. But much sooner than that—almost immediately, in fact—the lives of young American families would be dramatically improved: No longer burdened with the task of paying off their $60,000 student loans, they could start buying cars and refrigerators. They could even go ahead and start having children, secure in the fact that FREE early childhood learning and day care services would provide the option of continuing their young careers virtually uninterrupted. Best of all though: Our eight-year old little-leaguers will no longer have to start saving for the Day Care expenses of their future children. They can just focus on learning to catch fly balls. | ||
| Silver at its cheapest compared to gold in five years Posted: 16 Apr 2014 11:21 PM PDT It takes sixty-six ounces of silver to buy one ounce of gold, and that makes gold the cheapest it has been in terms of silver in five years. Traders say silver is cheap and gold looking a bit rich. Bloomberg’s Olivia Sterns and John Brady of RJ O'Brien & Associates put gold futures in focus in ‘On The Markets” on Bloomberg Television’s ‘In The Loop’… | ||
| Gold, Silver And The Mining Sector: Prepare For A Severe Fall Posted: 16 Apr 2014 11:10 PM PDT This is a distressing time for gold and silver bulls like me who are constantly on the lookout for a turnaround in the precious metals sector. I'm confident that it will come but not just yet, as a final capitulation has not taken place. On 18th November we wrote the following: This sector is to some extent in the hands of Janet Yellen and The Federal Reserve. If the economy takes a turn for the worse and she behaves as dovishly as she is portrayed then we could see an increase in QE. However, if the employment figures continue to show slow but steady progress, then there will be no increase in QE and then the outlook for these metals will look less attractive. Should tapering be introduced the US dollar will appreciate and gold, having an inverse relationship with the dollar will suffer. The Fed appear to be satisfied that the economy is making steady, if slow progress and is on the road to recovery, hence the introduction of tapering. This programme of reducing QE possibly to zero looks set to continue and be completed towards the end of this year, barring any sudden reversal in the employment/inflation data for the US. The perma-bulls among us are confident that the lows formed in June 2013 for gold prices represent the bottom for gold and their enthusiasm for higher prices is indeed infectious. However, we view this stance with some trepidation as we are still of the opinion that this gold bull market remains in a bear phase for now. The bears won't always have the upper hand, but until this bear phase exhausts itself completely there is little chance of a sustainable rally in this tiny sector. To maximise our profits we need to time our entry and exit points to the best of our ability. We all know that finding the exact bottom or top of a market is almost impossible to do, but this does not preclude us from trying to get as close as possible to these major directional changes, in this case from the bear phase to the resumption of the bull market. As we write Gold is trading around $120/oz above the June lows, silver is about $1.50/oz above its low point and the mining sector as evidenced by the Gold Bugs Index, the HUI, is sitting about 20 points higher. This is not the picture of a runaway success story, on the contrary it depicts a sector struggling to gain any traction and lacking in conviction. Retail investors and fund managers a-like need to have a clear view of the big picture before committing hard earned cash to any investment opportunity, failure to do so will render success as elusive as the Scarlet Pimpernel. Gold and Silver The sparkling days when gold hit $1900/oz are now a distant memory as gold has fallen back, rallied and fallen back again. A number of head fakes and false dawns have placed gold prices in the precarious position of approaching the summer doldrums in a state of weakness. Gold is unloved and to some extent forgotten as its current bear phase has dominated for close on 3 years now, driving the weaker hands out of the market and putting a dent in the portfolios of those brave enough to stick it out. Silver prices have enjoyed a brief flirtation with the $22.00/oz level but failed to hold onto those gains. It is now trading at $19.58/oz which puts it back to where it was in December 2013, in a sideways trading channel. The HUI The performance of the precious metals mining sector is predicated on the performance of the underlying asset, along with the ability to produce the metal at a price lower than the selling price. Mining costs have accelerated over recent years with some costs now standing at $1200/oz, which has to be achieved before we can talk about profits. However, when these costs have been covered every dollar earned above these levels goes straight to the bottom line. This then becomes an exciting time to be invested in the mining sector as stocks can rise, in percentage terms, 2 and 3 times more than the metal itself. Taking a quick look at a chart of the HUI we can see just what a difficult time the miners are experiencing. A re-test of the June lows looks to be on the cards and should that support level fail to hold then we could see a re-test of the old '150' level which was formed in 2008.
A certain amount of euphoria was generated in the first quarter of 2014 when the miners came out all guns blazing. This rally was short lived and as of today the overall gain for this year is about 10%. When we take into consideration that these stocks had their values halved in 2013, then we can see that this move upwards is hardly a cause for celebration. Conclusion Among the many factors that we can point to as being influential for precious metals the following are just a few;
As logical and sensible as these arguments are the fact remains that gold and silver are not heading to the moon just yet. There could be one or a combination of reasons for this lack of progress, but the two that get our attention are the lack of a final capitulation in gold and silver prices and the reduction of QE via the Fed's tapering programme. Gold's progress was characterized by a sudden steepening of the curve leading to a final blow off when the price had gotten ahead of itself. We now need to see a similar occurrence take place during a sell off. However, this sell off, as torrid as it has been lacks that final spike down which occurs when even the most ardent bulls have had a guts full and finally throw the towel in. Gold and silver's inability to sustain a decent rally suggests that it could re-visit and test its old June lows. Should this support fail to hold we could then experience a rather disorderly sell off taking gold back to the $1000/oz level. The 'sell in May and go away' strategy may be adopted in the coming weeks which may add additional selling pressure to the mining stocks. Also take note of the Federal Reserve Meeting planned for April 29/30th for any changes to monetary policy regarding tapering/QE/Rate changes, etc. Finally we need to see more in the way of all around strength in this sector before we can implement an aggressive acquisitions strategy, and so we have the lion’s share of our portfolio in cash. Got a comment, fire it in, the more opinions that we have, the more we share, the more enlightened we become and hopefully our 'well informed' trades will generate some decent profits. From the small team here we wish you and yours a very Happy Easter.
Bob Kirtley | bob@gold-prices.biz | www.gold-prices.biz |
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