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Iceland's President: Why Are the Banks Considered the Holy Churches of the Economy? Let Them Fail!
Rick Rule About Junior & Exploration Miners: The Sector Is A Disaster
Official US Gold Audit – 12 Days Left To Sign The Petition
Gold And Silver Truth-Seeking: Fundamentals & Opinions Are Useless
It's Getting Hard To Be A Gold Bull These Days
Massive Head & Shoulders Top Maturing in the Dollar: Breakdown Will Launch Gold Through $1800
Bank of England gold – the doubts remain
The Real Currency, Gold and Energy War in Mali
Gold Carpet Treatment Promised For Miners In The Dominican Republic: Alexander Medina
Official US Gold Audit – 12 Days Left To Sign The Petition
The Legend of Chief Namekagons Lost Silver Mine
Jim Sinclair: Gold is the ultimate battle between good and evil
GGR COT Subscriber Update Posted
James Turk: Central Banks are Losing the War to Suppress Gold & Silver Prices
Silver ; Gold ; Palladium – Technical Analysis
Bill Murphy & Chris Powell's Full Presentation on Gold Manipulation at 2013 VRIC
Reinstatement Sought for Silver Market Rigging Class-Action Lawsuit
Jim Sinclair: This is the Big One!

Iceland's President: Why Are the Banks Considered the Holy Churches of the Economy? Let Them Fail!

Posted: 27 Jan 2013 11:33 AM PST

Iceland's President Olafur Ragnar Grimsson was interviewed over the weekend at the World Economic Forum in Davos on why Iceland has enjoyed such a strong recovery after it's complete financial collapse in 2008, while the rest of the Western world struggles with a recovery that has no clothes. Grimsson gave an EPIC reply to the [...]

Rick Rule About Junior & Exploration Miners: The Sector Is A Disaster

Posted: 27 Jan 2013 09:53 AM PST

Among the most successful resource investors is undoubtedly Rick Rule. During an interview, earlier this week, he talked with Resource Investing News about the prospects of the junior and exploration resource market. He believes that the bottom has not been reached yet. If you would merge all junior mining companies into one company (Junior Explore Company), you would lose $2 billion per year, explained Rick Rule. "The sector as a whole is a disaster," is his current view.

What makes the sector work is the top ten percent of the companies in the sector. If you are not doing the work to segregate the wheat from the chaf then get out of the sector. People wanted to be in the sector in 2010 at the market top, and they don't want to be in the sector 3 years later with the prices 70% off. It is like someone walked in the street and ignored every store that a "for sale" sign and went to the only store that had the "full price, no discounts ever" sign. Now is the time to time to buy as we are in a bear market. We sell high in a bull market; we buy low in a bear market.

This view is not very promising, especially in a time when the gold and silver miners struggle to keep their stock valuations. After the spectacular run-up between 2002 and 2006, and a significant rally after the financial crash of 2008, the gold shares have been clueless. Looking at the junior miners, the following chart shows how the GDXJ stands even lower than three years ago in spite of a gold price that stands some 60% higher.

Given the difficult state of the sector, especially the junior and exploration miners, it is interesting to know that Rick Rule his research framework to find the winners is based on the "Prospect Generator Model." The model is based on the fact that the exploration business is at its core high-tech, high-IQ research and development oriented. The companies are not asset-intensive but rather intellectual capital businesses. For investors, this all boils down to risk management, as explained in a brilliant way by Rick Rule with the following quote.

Preserving your interest in a property where you have a one in 2,000 chance of success and sacrificing through dilution your interest in the knowledge base in the company is stupid. Using your company's knowledge base to secure third-party funding for exploration risk gives you the highest probability of success in exploration. Most speculators fail because in high-risk, high-reward businesses they're reward chasers. If you manage your risk, the reward will take care of itself. In prospect generation, you sell the risk while keeping part of the reward for yourself. It's all about probabilities and it's all about managing risk.

The tip for investors is to look for exploration and junior companies that do a lot of joint ventures. Companies that rely on other juniors or major mining companies to do their prospect generation run a lower risk than the ones that are funding their own exploration.

The mid-tier and senior segments are currently not performing slightly better than the juniors, but the disconnect with the gold price is comparable. Casey Research just released their view on that disconnect. They point to the disbelief by the institutional world in permanently higher gold prices and expectations of rising input costs (for instance oil).

We see the potential in gold equities, as we believe the price of gold is going higher, but big investors with billions of dollars to pour into a market don't. Their money, for the most part, is still on the sidelines.

This phenomenon leads us to predict that someday these institutional investors will enter this sector en masse. Once the facts sink in and the institutional world becomes convinced gold and silver prices will maintain a sustainable uptrend, they'll be much more attracted to the equities – and just as stubborn about changing their minds once they're on board.

Casey Research expects much higher prices in the future especially for producing miners. For now, as the institutional world does not see higher gold prices, no official role of gold in the monetary system, bonds as a safe place for money, controlled inflation, their interest in the sector seems very fragmented and not a catalyst.

Official US Gold Audit – 12 Days Left To Sign The Petition

Posted: 27 Jan 2013 09:34 AM PST

As reported earlier on this site, an official petition was launched on the website of the White House to have the US vaults audited. If there is one thing kept secret, then it is the amount of gold held by the US central bank. The presence of central bank gold became a very in the past couple of months and seemed to create a chain reaction after Germany announced to repatriate part of their gold back to Germany. It remains unknown to everyone how much gold really is present in the vaults. The US vaults host a lot of gold of many countries worldwide.

25,000 signatures are needed by February 08, 2013 to validate the petition. The number of signatures currently is 6,600. With 12 days to go, more than 1,000 signatures per day are needed to achieve the target set, which seems almost impossible (given there have been some 300 signatures per day on average).

We still encourage readers to sign the petition (an account needs to be created first).

SIGN THE PETITION NOW

US gold petition 12 days left gold silver general

Gold And Silver Truth-Seeking: Fundamentals & Opinions Are Useless

Posted: 27 Jan 2013 09:14 AM PST

Michael Noonan Articles: Gold Silver Prices

All general statements are untrue, [including the one above and this one]. There are exceptions to every general rule, so they cannot always be true.

There is truth to the consideration that all fundamentals and opinions are useless in the markets, as they pertain to timing, and timing plays a huge role when investing/trading. What fundamentals/opinions do is put one's belief system into a context with regard to the market[s]. If one wants to profit from any belief, he/she is then pitted against the forces of the marketplace in their exercise.

If you know about the fundamentals, to whatever degree you believe, and/or if you have an opinion, from whatever source and however reliable or not, the question then becomes, "What are you going to do about it?" Our premise topic, fundamentals and opinions are useless, goes back to what we have stated before:

It does not matter what others say about the market.
What matters is what the market says about others.

People are drawn to articles/information that reinforces their beliefs. Markets force people to put aside their bias and deal with what is, or else deal with the consequences if the bias/belief is in conflict. The market is, and always will be, the final arbiter of all "facts" and "opinions."

The market is composed of all the known [and not so well-known] facts that affect supply and demand. "The gold held in New York and London is/may be gone." Fact or fiction? The Fed and London ain't telling, or what they are telling is that "belief" is untrue. Fiat currencies are being created at unprecedented levels. We all know that is a fact, and many believe gold and silver will/should recognize that fact and be priced accordingly, [but are not]. The fundamentals for silver supply and demand are incredibly bullish. Few can deny that, the few being the Fed and JPM, et al.

The market knows all of this! Yet, the price of both gold and silver are languishing in protracted trading ranges. So how valuable are the fundamentals or opinions about gold going to $5,000, or silver to $400, [pick your own number, as most undoubtedly have one]?

For right now, and for the pat 18 months or so, the best information in the world, the strongest opinions held have been "useless." The charts, [the market translated into a visual format], reflect the trading ranges, and current prices are just about dead center within them. The middle of a trading range is where the level of knowledge is at its lowest. It is a coin toss. Price can rally to the top of the range and still fail, or it can decline to the bottom of the range and fail to go lower. Flip a coin!

Whatever your opinion of where the price of gold and/or silver should be, this is what the market is saying about your "belief/opinion:"

[Monthly charts are not included as the month ends next week, and those charts will be included next week. The discussion for gold is more general, and a little more detail is given in the silver charts, as both are similar.]

The market is showing price to be in the middle of a lengthy trading range, [TR], and until the TR is broken, up or down, one is spinning wheels in between. Last week, we showed how the clustering of closes could signify support and a rally, or a pause before continuing lower. The gold "rally" fizzled and has retraced back to the clustering. Will it continue to act as support, or fail?

Not only is gold in the middle of the TR, it is also in the middle of a down channel. It is anyone's guess for now.

Let us add that the fundamentals are incredibly bullish, and within that context, we continue to advocate buying the physical at any price, and buy consistently. Our analysis pertains to trading/buying the futures. Regardless of the bullish context of the fundamentals, the market is saying, "Not right now." Until price rallies above $1,800, it is not going reach whatever future expectation one may have, which is all we are saying. For timing, any/all fundamental considerations are useless. For positioning one's self in the physical, now is the time. When gold/silver take off, [even we have a bias], it will be fast and furious [opinion], with no looking back, but that can be months, Quarters, possibly year[s] away.

The daily chart comments pretty much speak for themselves.

Last week, we noted a long position on the strength of the wide range, strong close bar, 6th bar from the end. The recommendation did not lead to much profit, but profits were taken prior to the decline, based on developing market activity at the time.

While silver is weaker, relatively to gold, it is behaving relatively stronger of late. Note how the weekly close is higher/above the clustering of closes, where gold is right at the clustering location, [both still in the middle!].

As with gold, now is the time to continue accumulating [stacking, as it were] silver at any price. Sales of the American Eagle are going through the roof and were recently halted until 28 January. Why the government continues to sell them at all is beyond us in comprehension, given it is part of the forces [of evil] endeavoring to suppress the market's alternative to the insidious issue of fiat.

For as much as an argument can be made that price is holding reasonably well within the ongoing TR, the "fact" that silver failed to reach the upper channel line is a sign of weakness. Yet, unlike gold, the decline in silver held above the wide range, strong close bar where a long position was recommended. You can see the small range high at 32.50, 3rd bar from the end. It was the market's message telling us that demand was weak. The long position was liquidated profitably, before the decline set in. Love those messages!

Where will the decline stop? We have no clue, nor do we [or you] need to guess. Instead, simply wait for developing market activity to indicate demand is overcoming supply. Why guess when the best source of information will make some kind of factual declaration?!

Maybe price will hold potential support at the clustering of closes, maybe not. What is more important is that the existing TR is telling everyone to wait, for those inclined to heed the market's message. Even on a shorter time frame, within the TR, the market is STILL saying, price is not strong. Buy the physical, but not the futures.

Fundamental context matters for what side one chooses. The message from the market matters the most for timing and implementing one's belief. That is a fact that has never changed and one that never will. Count on it!

[Just don't take it to the bank. Banks cannot be trusted.]

It's Getting Hard To Be A Gold Bull These Days

Posted: 27 Jan 2013 08:34 AM PST

By Tim Iacono:
Driven higher over the last month due largely to the prospect of increasing central bank money printing, gold and silver challenged important price levels early last week but failed to hold them, spurring technical selling that led to their sharpest weekly declines since mid-December.
A short-term resolution to U.S. budget deficit troubles and yet another gold import tax hike in India were negative developments for precious metals, while central bank actions and strong demand for physical silver were positives, however, traders were clearly more influenced by the former than the latter.
It's getting hard to be a gold bull these days and even more difficult to be optimistic about mining stocks as noted in this article last week.
For the week, the gold price fell 1.5 percent, from $1,684.70 an ounce to $1,659.30, and silver dropped 2.2 percent, from $31.89 an ounce to $31.18. Gold is now down 0.9

Complete Story »

Massive Head & Shoulders Top Maturing in the Dollar: Breakdown Will Launch Gold Through $1800

Posted: 27 Jan 2013 08:17 AM PST

Submited by Morris Hubbartt: The dollar's huge head and shoulders top formation is maturing. The target is 72. It will be activated when the dollar closes under 78, for two consecutive days. A breakdown under 78 should be accompanied by gold breaking above $1800. Over time, markets oscillate from undervaluation to overvaluation. The chart below [...]

Bank of England gold – the doubts remain

Posted: 27 Jan 2013 06:00 AM PST

Last week I wrote about the mess the Bundesbank has found itself in over its gold bullion. But they are not alone: the Dutch, Austrian, Mexican and now even the Swedish central banks are also coming ...

The Real Currency, Gold and Energy War in Mali

Posted: 27 Jan 2013 03:53 AM PST

Pepe Escobar, the "roving eye" correspondent of Asia Times, tells you about the real currency, gold and energy war that is now raging in Mali, as the overall Global War on Terror needs new battlefields to perpetuate itself as "The … Continue reading →

Gold Carpet Treatment Promised For Miners In The Dominican Republic: Alexander Medina

Posted: 27 Jan 2013 03:48 AM PST

By The Gold Report:

The Gold Report caught up with Alexander Medina, the newly appointed director of mining for the Dominican Republic. With gold discoveries popping up all over Hispaniola - the country shares the metal-rich island with Haiti - Medina is a very busy government minister. But he was happy to spare a little time to talk to The Gold Report about what his office is doing to ensure that mining companies get the gold carpet treatment under the new administration.

The Gold Report: What is the main job of the director of mining management?

Alexander Medina: I oversee all the mining policies of the Dominican Republic. And I am in charge of granting mining permits and licenses to explore for precious and base metals and minerals.

TGR: What experience do you bring to this job?

AM: I have worked in mining operations, mineral processing and management

Complete Story »

Official US Gold Audit – 12 Days Left To Sign The Petition

Posted: 27 Jan 2013 03:32 AM PST

We still encourage readers to sign the petition (an account needs to be created first).

SIGN THE PETITION NOW

US gold petition 12 days left gold silver general

The Legend of Chief Namekagons Lost Silver Mine

Posted: 26 Jan 2013 10:30 PM PST

Atthecreation

Jim Sinclair: Gold is the ultimate battle between good and evil

Posted: 26 Jan 2013 09:00 PM PST

GATA

GGR COT Subscriber Update Posted

Posted: 26 Jan 2013 08:02 PM PST

HOUSTON – Vultures (Got Gold Report Subscribers) please log in and navigate to the Got Gold Reports Section of the Subscriber Welcome Page to view a presentation we intend to give in an upcoming conference. This presentation focuses on the current conditions in the Commodity Futures Trading Commission (CFTC) commitments of traders (COT) reports and presents our "read" of those conditions as of the most recent COT report released Friday, January 25.

Importantly, we need to note significant changes since our most recent video update in this presentation. To subscribe to Got Gold Report click on the "Subscribe to GGR" button at right under the GGR Login button.

James Turk: Central Banks are Losing the War to Suppress Gold & Silver Prices

Posted: 26 Jan 2013 01:16 PM PST

"My guess is that 2013 and 2014 are going to be big up year for the precious metals, but we still have to contend with the central planners and the various government policies, which have been actively trying to keep the gold and silver prices from reaching fair value. The central planners are losing the war. They may win an occasional battle or two, but they're losing the war, and eventually gold and silver are going to go higher."

So predicts James Turk, founder and Chairman of GoldMoney.com.

From James' perspective, gold is not an investment. It's a sterile asset, meaning it does not generate income. What it is, is money. Its function is to store wealth.

But money, like investments, can be overvalued or undervalued. And what we're witnessing on the world stage is a gross mispricing of money as central banks engage in depreciation of their fiat currencies via inflation (i.e. money printing).

The process causes a transfer of wealth from those holding overvalued money to those who hold undervalued money. That's what's been going on for the past decade as the price of gold has steadily marched upwards versus fiat currencies.

But this process is not efficient. Mass awareness of this wealth transfer is low, so confidence in paper currencies is still high, supporting their perceived value. Market intervention by central banks and other parties conspires to keep the prices of precious metals artificially low and suspect.

This maintains an arbitrage for individuals to buy gold and silver at a discount to true value, which James believes will be slowly realized in full over the next several years as the bull market in precious metals approaches its third and final phase.

A factor in this rise will be the increasing fragmentation of coordination among the central banks. Increasingly, central banks outside the influence of the US' Federal Reserve are treating the precious metals as true money, and becoming net buyers of bullion for their reserves.

Ultimately, Turk predicts the price of gold will move to somewhere between $8,000-10,000/oz, and that we'll see even higher price appreciation in silver.

Silver ; Gold ; Palladium – Technical Analysis

Posted: 26 Jan 2013 01:14 PM PST

Bill Murphy & Chris Powell's Full Presentation on Gold Manipulation at 2013 VRIC

Posted: 26 Jan 2013 12:08 PM PST

For those unable to attend the 2013 Vancouver Resource Investors Conference last weekend, Cambridge House has released Bill Murphy and Chris Powell's full presentation on the state of GATA's efforts to bring the attention of the cartel's gold and silver manipulation into the public domain. Powell discusses GATA's recent findings demonstrating manipulation of the gold [...]

Reinstatement Sought for Silver Market Rigging Class-Action Lawsuit

Posted: 26 Jan 2013 05:37 AM PST

¤ Yesterday in Gold and Silver

The gold price traded pretty flat all through Far East trading...and only began to head south around 11:00 a.m. in London. It hit its low tick at 10:00 a.m. Eastern time...the 3:00 p.m. GMT London gold fix.

The smallish rally that followed died within a few hours...and gold traded flat into the close from 12:30 p.m. Eastern time onward. The high tick [about $1,672 spot] was around 3:00 p.m. Hong Kong time...and the low tick at the p.m. gold fix was $1,654.90 spot.

Gold closed on Friday at $1,6529.30 spot...down $8.10 on the day. Net volume wasn't overly heavy at 111,000 contracts.

It was pretty much the same chart pattern for silver...and the big difference between the two was that the low tick for silver was nowhere near the London p.m. gold fix. Instead, it came in electronic trading shortly after the Comex close. Like gold, silver traded virtually sideways from 12:30 p.m. onwards...except for the spike low.

The high tick [around $31.75 spot] came shortly after 3:00 p.m. in Hong Kong...and the low [$31.04 spot] was printed around 1:50 p.m. in New York.

Silver closed at $31.18 spot...down 44 cents from Thursday. Volume was 'average'...around 39,000 contracts.

It was a far different story in both platinum and palladium, as both finished in positive territory. Palladium was on fire...up 2.07%. Platinum was up 0.71%. Gold finished down 0.49%...and silver closed down 1.39%.

Never have I seen such a dichotomy in chart patterns...and I'm not sure what to make of it.

The dollar index opened at 79.99...and climbed a hair to around 80.06 by noon in Hong Kong...and then dropped off a 20 basis point cliff shortly before 3:00 p.m. Hong Kong time. After that, the index chopped its way slowly lower....with its nadir [79.68] coming just minutes before 11:00 a.m. in New York. It closed at 79.74...down 25 basis points from Thursday's close.

If you can fit the dollar index action to any of the precious metal charts above, I'd like to see how you did it.

Like Wednesday and Thursday action, the gold stocks opened down...and headed lower almost immediately. The low tick came at 11:00 a.m...and the stocks tried valiantly to recover some lost ground...but got sold off again in the last few minutes of the trading day. The HUI closed down 2.68%...and slightly below the 400 mark at 399.04.

Here's the HUI for the last five business days...and it ain't pretty. There was no chart on January 21...because it was Martin Luther King Day in the U.S...and the markets were closed.

The silver stocks finished down as well, but there was the odd green arrow in the list of stocks I track. Nick Laird's Intraday Silver Sentiment Index closed down 2.50%.

(Click on image to enlarge)

Here's the long-term Silver Sentiment Index that shows how these silver stocks have behaved over about five years.

(Click on image to enlarge)

The CME's Daily Delivery Report showed no activity in either gold or silver. Almost all the deliveries on Tuesday were in copper...and a couple of contracts in platinum.

There was more withdrawal activity from both GLD and SLV yesterday. The withdrawal from GLD was 58,087 troy ounces...and from SLV it was 918,796 ounces.

Silver ETF Bar Guru, Joshua Gibbons updated his webpage with all the data from the big deposit of 18.3 million ounces into SLV last Thursday...and you can read all about it here. If you're new to the site...and most readers are...it's worth a few minutes of your time to poke around a bit.

Over at Switzerland's Zürcher Kantonalbank for the period ending January 24th...they reported that 22,639 troy ounces of gold were withdrawn from that particular ETF...but their silver ETF reported adding 423,554 troy ounces.

There was a tiny sales report from the U.S. Mint...500 ounces of gold eagles...and 500 one-ounce 24K gold buffaloes. Month-to-date the mint has sold 132,000 ounces of gold eagles...67,000 one-ounce 24K gold buffaloes...and 6,007,000 silver eagles. That gives a silver/gold sales ratio of 30 to 1. No doubt it would have been larger than that if there had been more silver eagles available to sell.

It was another active day in silver over at the Comex-approved depositories on Thursday. They reported receiving 1,354,601 troy ounces of the stuff..and shipped only 37,301 troy ounces out the door. The link to that activity is here.

I forgot all about yesterday's Commitment of Traders Report when it came out at 3:30 p.m. Eastern time yesterday afternoon...and it only came to mind as I began writing today's column yesterday evening. You'll just get the Reader's Digest version today, as I have lots of stories to post.

Because of rising prices in silver and gold, I was expecting an increase in the Commercial net short position in both metals...as "da boyz" were obviously going short against all comers...and that's precisely what the report showed.

Silver's net short position jumped a huge 5,366 contracts, or 26.8 million troy ounces of paper silver, so it was obvious that JPMorgan et al had to aggressively sell this market short to prevent the price from blowing out to the upside during the reporting week.

Gold's Commercial net short position increased by 10,837 contracts, or 1.08 million paper troy ounces.

But all this data was as of the Tuesday cut-off for this report...and is now "yesterday's news" as Ted Butler is wont to say. The big engineered price declines in both gold and silver that began after the Tuesday cut-off have reversed all of the above data...and then some.

We have two more days left [Monday and Tuesday] in the reporting week for next Friday's COT report..and we'll have to wait impatiently for time to pass.

Here's Nick Laird's weekly "Days of World Production to Cover Short Positions" chart updated with Tuesday's COT data. The 'Big 8' have added seven days of world silver production to their short positions since last week's update. The link to the long-term interactive COT charts for both silver and gold are here...and here.

I have lots of stories for your weekend reading 'pleasure'...and I hope you can find the time to read the ones that interest you the most.

Well...are JPMorgan et al done to the downside yet? That's the first question that needs an answer.

If China likes silver, maybe we should too. Visualizing Platinum & Palladium's Place In The World. Suspicion about Bundesbank's gold dealings with Fed is getting respectable. Timmins Gold CEO notes the paper gold fraud.

¤ Critical Reads

Bank of America issues `bond crash' alert on Fed tightening fears

The US lender said investors face a treacherous moment as central banks start fretting about inflation and shift gears, threatening a surge in bond yields.

Bank of America said the "Great Rotation" under way from bonds into equities closely tracks the pattern of 1994, with bank stocks leading the way.

Over the past seven years US investors have pulled $600bn from US equity funds and poured $800bn instead into bond funds. This process is going into reverse. Equity funds have drawn $35bn over the last 13 trading days alone, creating the risk of an unstable "melt-up" in stocks over coming months.

The Bank for International Settlements has issued an alert on the high-yield `junk' bonds and mortgage debt, currently trading at record lows. The Swiss-based watchdog said parts of the credit market credit are "highly valued in a historical context relative to indicators of their riskiness."

This Ambrose Evans-Pritchard offering from early Thursday evening GMT is courtesy of Roy Stephens...and I thank him for today's first story. The link is here.

View full GSD edition

Choice of Mary Jo White to Head SEC Puts Fox In Charge of Hen House

I was shocked when I heard that Mary Jo White, a former U.S. Attorney and a partner for the white-shoe Wall Street defense firm Debevoise and Plimpton, had been named the new head of the SEC.

I thought to myself: Couldn't they have found someone who wasn't a key figure in one of the most notorious scandals to hit the SEC in the past two decades? And couldn't they have found someone who isn't a perfect symbol of the revolving-door culture under which regulators go soft on suspected Wall Street criminals, knowing they have million-dollar jobs waiting for them at hotshot defense firms as long as they play nice with the banks while still in office?

Matt Taibbi is on another rant once again...and I must admit that I'm not surprised. This commentary showed up on the Rolling Stone magazine website early yesterday morning...and I thank Roy Stephens for sending it. The link is here.

View full GSD edition

Tina Turner becoming Swiss citizen; hometown mayor 'surprised'

What Gerard Depardieu is to France, Tina Turner may be to the United States.

The Nutbush, Tenn. native is giving up her US passport, in favor of a Swiss one.

"I'm very happy in Switzerland and I feel at home here. ... I cannot imagine a better place to live," Turner told the German newspaper Blick.

Turner has lived in the Zurich suburb of Kuesnacht since the mid-1990s. The local Zuerichsee-Zeitung newspaper said on its website the local council announced its decision to grant the 73-year-old Turner citizenship in an official notice published in Friday's edition.

Seventy-three years old? Wow...that really dates me. This story showed up on the foxnews.com Internet site yesterday...and it's courtesy of reader "Nick G"...and the link is here.

View full GSD edition

Eric Sprott & Etienne Bordeleau: Ignoring the Obvious

Not a day goes by without hearing about the fiscal cliff, the debt ceiling or another political deadlock. We would not disagree that some of these are important issues that need resolving but, in the grand scheme of things, they are relatively superficial.

As we all know, central banks around the world have been frantically expanding their balance sheets. While exceptional times might warrant exceptional measures, Figure 1 below paints a rather troubling picture. The monetary base, the amount of money in circulation in the economy, has expanded at an incredible pace. Since the mid-80s, the U.S. monetary base had been very stable at around 5-6% of GDP. Through fractional reserve banking, this amount was sufficient to maintain annual inflation around 2-3%. With the banking system collapsing in 2008-2009, it was necessary for the Fed to increase the monetary base. However, banks are now in much better shape than they were in that period and the benefits of monetary expansion seem to be waning.

The Fed is not the solution to every economic and social woe and trying to hide real problems (e.g.. structurally high unemployment and rampant poverty, unsustainable income inequality and exploding government liabilities) with money printing achieves nothing constructive.

This is the January edition of Sprott Asset Management's Market at a Glance feature commentary...and it's definitely worth reading. The link is here.

View full GSD edition

Doug Noland: Liquidity Bubble

Ray Dalio is one of the foremost economic thinkers and investors of this era. His hedge fund empire now manages $130bn. He has taken on a higher public profile of late, including notable interviews and speaking engagements this week at Davos (43rd World Economic Forum Annual Meeting). In previous CBBs, I highlighted Mr. Dalio's "beautiful deleveraging" thesis. His comments Thursday and Friday from Davos raised some eyebrows – and are certainly worthy of analytical focus.

I'm ok with "liquidity Bubble" terminology - and I'd be ok with "money Bubble." The key to the analysis is to recognize it remains an unprecedented monetary Bubble – an integral facet to sustaining a global Credit Bubble. I agree with Dalio that a flight out of this "money" holds the potential for an extraordinary 2013. I wish I could be as sanguine. I worry about what this "money" might do. But my greater fear is that global policymakers have impaired the creditworthiness of "money" – the foundation of global finance. They fell for the same monetary inflation trap that has cursed humanity throughout history.

Unprecedented "money printing" has continued for too many years. The debits and Credit add to the Trillions. Along the way, the Fed has tried to assure that they do indeed have an exit strategy. I have all along the way argued there would be No Exit. The Fed has theorized how they would withdraw liquidity before it could fuel higher inflation. From a global Bubble perspective, I've seen the greater risks in asset inflation and rejuvenated market Bubbles.

The Fed would be well served to go immediately back its drawing board and try to figure out how to stop all this liquidity from turning inflated and highly speculative global risk markets into an out of control mania. I'm not holding my breath.

Doug Noland is at the top of his game in his Friday Credit Bubble Bulletin posted over at the prudentbear.com Internet site. It's definitely worth reading...and the link is here.

View full GSD edition

Venezuela is Struggling With a Historic Food Shortage

In December, the Central Bank said its scarcity index, which tracks the percentage of consumer goods missing from grocery store shelves, rose to a four-year high of 16.3 percent in December.

In light of the situation, some supermarkets and bakeries are restricting the amount people can buy. Some Caracas restaurants are even cutting back on their menu offerings.

"January is always a tricky month because distributors go on vacation in December but by mid-month inventories are usually restocked," said Edgar Parra, manager of a sparsely stocked grocery store in Caracas where customers scrounged for items. "Not this time around."

This AFP story was picked up by the businessinsider.com Internet site late yesterday afternoon Eastern time...and it's also courtesy of Roy Stephens. The link is

Jim Sinclair: This is the Big One!

Posted: 25 Jan 2013 08:45 PM PST

Legendary gold trader Jim Sinclair has sent another email alert to subscribers today, warning that the current reaction in gold is the big one, and the last play by the bullion banks to denude gold and silver investors of their positions. Sinclair states that fundamentally, we are approaching the period where gold and silver will [...]

Save Your ASSets First

Sunday, January 27, 2013