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Wednesday, January 30, 2013

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Is gold the answer to Europe's worst case scenario?

Posted: 30 Jan 2013 05:46 PM PST

How long can unemployment rates for under 24s remain near 60%, as in Spain and Greece, without the powder keg igniting? – Gold may yet be the best insurance against riot induced economic collapse.

Gold equity, bullion correlation strengthening

Posted: 30 Jan 2013 05:45 PM PST

According to Investec Securities the correlation between gold miners and the metal they mine is strengthening but, sideways movement this year is expected.

Dubai gold dealers shun Turkish bars on fears of Iran link

Posted: 30 Jan 2013 02:53 PM PST

Trade in Turkish gold bars to Iran via Dubai is drying up as buyers refuse to buy the bullion to avoid the risks associated with Turkey's gold-for-gas trade with Iran.

Harmony Gold makes progress on restarting Kusasalethu

Posted: 30 Jan 2013 12:36 PM PST

The company said Tuesday it had made progress in talks with unions to reopen its Kusasalethu mine that has been closed due to labour violence.

AuRico Gold: This Miners-Metals Trade May Bring 30+% Returns In A Few Days

Posted: 30 Jan 2013 11:09 AM PST

BySYG Capital:

We are obsessed with gold and gold miners. As a whole, gold miners are in a strange place: they are adversely affected by gold price, but due to poor management performance across the industry metals prices have outperformed miners prices over the past few years.

Miners are slowly shutting down or selling higher-cost or non-performing mines, which would seem to be an improvement. Some miners, like Aurizon (AZK), have even seen buyout offers. But every once in a while a management firm does something so inexplicably idiotic that the firm becomes an obvious short.

Enter AuRico Gold (AUQ), which recently completed a significant buyback at $8.30/share and fell quite a bit (plot from Google Finance):

(click to enlarge)

Clearly traders were not happy with the results of the buyback (it was greatly oversubscribed), but the primary reason for such a heavy selloff is if traders think the fair price


Complete Story »

Silver jewellery demand surges during 2012 holiday season

Posted: 30 Jan 2013 10:14 AM PST

With continuing consumer demand for exciting new designs, designers are finding that silver offers them more freedom to create more elaborate pieces while keeping the price points at a reasonable level.

Euro Yen Cross Continues Streaking Higher

Posted: 30 Jan 2013 09:55 AM PST

Remember our old friend, the Euro-Yen cross from its hey day back prior to the credit crisis of 2008? We used this cross as a gauge of risk sentiment particularly during the massive Yen carry trade of that time frame. The cross came under tremendous pressure when that carry trade was unwound and the investing world was rushing into safe havens and out of speculative positions.

When the Euro was the subject of "the Euro is finished" talk during the height of the European sovereign debt crisis, this cross was hit particularly hard. However, once the ECB got into the act and the Europeans put together their bond buying program, the Euro began a steady recovery against the Yen. Thus far we are not hearing any significant chorus of monetary officials/political leaders out of the Euro Zone making noises about the strength of the Euro. That is why money keeps flowing into the Euro.

I think it is no insignificant matter than the recent rally in the US equity markets  which has seen the S&P move to a FIVE YEAR HIGH just so happens to parallel the rise in this cross. That cross has been and still remains one of the more accurate measures of risk sentiment that we have, along with the bond market of course.

Take a look at the recent action of the cross as it confirmed a bottom in November last year and the subsequent action in the S&P 500 which also rallied off a short term swing low that same month. With the exception of the selling pressure in the last few days of 2012 (based no doubt on tax related selling), the two have been moving in lockstep.

Clearly, speculative fever has been revived in regards to stocks based on this cross. The question now becomes, will the commodity sector be next? That is why as long as this cross continues higher, I am going to be very closely watching the price action of the Continuous Commodity Index or CCI. So far that index has not been following the cross higher as it actually went in the OPPOSITE direction of the cross during the month of November. However, it is beginning to show signs of paralleling the cross. If this connection, which was in exact lockstep leading up to the peak in commodities back in 2008 becomes re-established, watch for the precious metals, in particular, silver, to start more of a sustained trend higher. Let's pay close attention to this as well...




Gold and quantitative easing: Inflation all over again?

Posted: 30 Jan 2013 09:43 AM PST

Perhaps you have heard that the Fed is printing money to get out of the crisis and that such actions cannot possibly end other than in even more money being printed and in the dollar losing its ability to buy you tangible assets.

OFT finds that the government is the cause of high petrol prices – when measured in gold petrol has never been cheaper

Posted: 30 Jan 2013 09:25 AM PST

The government's ability to spend money to state the bleeding obvious knows no bounds, and the latest report by the government funded OFT into petrol prices is no exception. First off the...

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How Goes It on the Inflation Front?

Posted: 30 Jan 2013 09:10 AM PST

READ THE FULL NEWSLETTER

If you ask John Williams, he will reply…

Lately, the big question affecting the price of gold is will the Fed continue QE or will they cut back, fearful of inflation?  Inflation, by their definition is running around 2%.  But, as you can see in the graph above, inflation is really running over 9%.  Which inflation number are they afraid of?  Since the beginning of the financial market turmoil in August 2007, the Federal Reserve's balance sheet has grown in size and has changed in composition. Total assets of the Federal Reserve have increased significantly from $869 billion on August 8, 2007, to well over $2 trillion, much of it being near-worthless mortgage bonds.  That is the engine of inflation and it is increasing to the tune of around $80 billion per month, as they continue to create new money, with the stroke of a keyboard, to purchase toxic mortgage bonds from the too-big-to-fail banks, and Treasuries on the open market.

If they aren't afraid of inflation they should be.  Jim Sinclair and John Williams say they cannot and will not cut back.  They "jawbone," but don't act.  How can they stop?  If they abandon the Treasury market, interest rates WILL rise – actually they are already starting to rise.  Remember, for every 1% rise in the interest rates, we add $160 billion in new interest to the annual deficit and the debt.  And, rising interest rates are toxic to the stock market and deadly to the already sickly real estate market.

Simply put, we can't afford to let interest rates rise and that is what QE is all about, plus clearing worthless assets off the banks' balance sheets.  Why would the Fed do such a thing?  Because the Fed (which is not Federal) is owned by the banks and is in business to protect the banks, not the people.  We will be thrown under the buss to help the big banks stay solvent.

If you side with the "they can't stop QE" or, as Jim Sinclair says, "QE to infinity" view, then off your dollar holdings while they still have buying power and take advantage of the current low prices of gold and silver.

Funny how I call $1,650 gold and $31 silver LOW.  I have been touting gold since it was $275 and silver since it was under $5.  But we can't roll back the clock and today's prices are cheap if the Fed continues to print, print, print.  And I believe they will.

The following video, We Are Going To Kill The Dollar, courtesy of our friend Bob U.

We Are Going To Kill The Dollar

In 1986 I had several phone conversations with John Exter.  He was a real gentleman and I would ask his advice on the economy and the dollar.  I was very familiar with his inverse pyramid and have invested accordingly, for the last two plus decades.  Exter wasn't just another pseudo economist or newsletter writer – he was the real deal and came from the bowls of the Federal Reserve.  He was one of the few Fed bigwigs who dared to speak the truth. And I listened.  And now, so should you. – be sure and read his The Central Banker Who Made A Fortune In Gold, written by Darryl Robert Schoon.Similar Posts:

Gasoline Prices on the Rise

Posted: 30 Jan 2013 08:57 AM PST

A mere two months ago, consumers were enjoying some of the lowest gasoline prices seen since early last summer. Call me a conspiracy nut but I no longer believe in coincidences seeing that these lower gasoline prices just so happened to strangely correspond to the lead up into the past election day.


Now that this is behind us, gasoline has been on a tear higher, along with crude oil I might add. You no doubt have noticed the increase at the pump already. Rising energy prices are something that cannot be long overlooked by those scanning the horizon for signs of inflationary pressures. I mentioned yesterday that heretofore, gold has ignored the strength in crude and the rise in distillates. That may be getting harder for it to do if this strength continues.

Remember, at some point, because of the pervasive impact of higher fuel/energy costs on nearly all segments of our economy, the price of transported goods must rise to reflect the higher costs for producers/manufacturers/distributors. When it does, the impact on the CPI should be seen. What is lagging right now is FOOD costs. You will recall that we have seen episodes in the recent past where both FOOD and ENERGY prices were rising in tandem. That occurence cannot be ignored.

For now, energy is taking the lead. We'll keep a close eye on this to see if unleaded gasoline can run as high as the $3.20 level or not.

Perhaps the stubborn refusal of energy prices to break lower is one of the factors contributing to the continued weakness in the bond markets...

Gold and silver jump on weak US data

Posted: 30 Jan 2013 08:38 AM PST

Gold and silver jumped to four-session highs above $1,674 and $31.65 per ounce respectively Wednesday lunchtime in London, gaining as new data showed the U.S. economy unexpectedly shrinking in late 2012.

Swiss Banks Encourage Allocated Gold over Unallocated

Posted: 30 Jan 2013 08:37 AM PST

Our friends at Stephen Flood's and Mark O'Byrne's GoldCore.com write this morning:   

"Reuters reports that "huge quantities" of silver bullion coins were being bought by investors, including entire monster boxes full with 500 1 oz bullion coins sealed by the US Mint.

Swiss banks, UBS and Credit Suisse, have moved to offer allocated gold and silver accounts to their clients – including high net worth individuals, hedge funds, other banks and institutions.


Gold in U.S. Dollars, Monthly – (Bloomberg)

The move allows these entities to take direct ownership of their bullion in allocated accounts.

(More...)

According to the Financial Times, the banks say that they are making the move in order to reduce exposure and risks on balance sheets and in an effort to be more transparent.

"Under more common "unallocated" gold accounts, depositors' bullion appears on the banks' balance sheets, forcing them to increase their capital reserves. Like their global peers, UBS and Credit Suisse are under pressure from regulators to reduce capital-intensive activities ahead of the introduction of new Basel III global banking rules."

It is more likely that the banks made the move to allocated storage due to an increased preference from their investors who are weary of continuing systemic risk.

We have spoken and written about this trend for some time.

In recent months there has been a definite change by our clients and by bullion owners internationally from owning gold and silver in unallocated accounts, to owning bullion coins and bars in allocated and segregated accounts.

Investors who were unwilling before to pay annual storage fees on allocated accounts are now willing to pay the extra cost. This is due to increased awareness and concern about systemic risk and a preference for owning gold directly and eliminating counter party risk.

Indeeed, we and other bullion dealers who offer allocated storage outside the banking and financial system have seen flows out of bullion banks unallocated gold account offerings and into allocated accounts such as with the Perth Mint and Via Mat.


XAU/JPY Gold in Japanese Yen, Monthly – (Bloomberg)

Smart money internationally is moving towards allocated storage and away from more risky unallocated storage and this trend is set to continue.

With unallocated storage one is an unsecured creditor of the provider or bank whereas with allocated storage the client directly owns the gold and the gold cannot become encumbered.

Allocated and segregated storage costs more money as more space is required in vaults and there is a higher insurance cost. Banks have realised that there is a preference to own allocated gold and are moving to offer that. They may also be able to make a small margin on the annual storage fee, in and above, the cost of storage to them.

The move by the Swiss banks is a reactive one in order to prevent the loss of clients who are concerned about systemic risk and want to own bullion in the safest way possible."

To view the entire blog post follow this link:

Source:  GoldCore.com

 http://www.goldcore.com/goldcore_blog/swiss-banks-offer-allocated-accounts-move-allocated-internationally

 

SLA Takes Out $32

Posted: 30 Jan 2013 08:27 AM PST

“I love my Keiser Ethical Silver.”

The Punch Bowl Runneth Over

Posted: 30 Jan 2013 08:27 AM PST

Fear not ye despairing lads and lassies. Surely thou wert fearful that said supply of spirits to enliven yonder punch bowl wert in peril of being dried up. Hark - the sum of all economic activity in the realm didst verily sink a fortnight plus ago. This turn of events must surely bring forth the purveyors of joy and bliss to aid thee.

Okay - I got a bit carried away - the big news, and I do mean "BIG" news this morning that has gotten the commodity sector excited and is in the process of pushing the US Dollar lower, is the fact that 4th quarter 2012 GDP actually managed to SHRINK! Yes, you got that right - it shrank! As a matter of fact, the reading was the worst since Q2 2009! Remember that we were back in an official recession during that time frame.

Ironically, and this to me is a big deal, government spending decreased and that is perhaps one of the biggest reasons for the reduction in growth. I have mentioned previously on this site that government spending was a large factor behind recent improvements in the rate of growth in this nation and that were it subtraced from the numbers, we would be showing very little in the way of actual growth. Lo and behold, I did not expect the growth rate to actually shrink were it removed from the equation.

Here is the ironic part - the US MUST REDUCE SPENDING as it is headed down a road that will certainly lead to economic ruin. When government debt is 100% of GDP it is unsustainable. Any who doubt need merely look across the Atlantic Ocean to Greece, Spain, Italy, Portugal, etc. Heck, even one of the French officials made the slip of the tongue in admitting the obvious, namely that France was bankrupt! While the US DEbt/GDP ratio is not yet at levels seen in the PIGS, it is most surely headed in that direction.

So guess what, if the US government attemps to rein in spending, economic growth will contract because this deficit spending by government is contributing to a large portion of the "growth" in this economy. But keep in mind, that government does not actually create wealth - it merely takes it from one sector of the economy with one hand and redistributes it to another sector with the other hand. To the extent that it adds "growth" to an economy, it is BORROWING FUTURE GROWTH INTO THE PRESENT when it deficit spends. Borrowed money must eventually be paid back and when it is in a debt-based economy. growth shrinks.


That brings us squarely back to the Fed - before this morning's GDP number was released, the world of investors were waiting with bated breath for the oracles to come forth from Delphi and issue their prophetic insight into the state of the US economy. Another duller way of saying this is that the conclusion of the FOMC meeting is today and the market was waiting for what statements would come out of that. Prior to today's GDP report, there were genuine fears of a curtailment in the QE4 program coming sooner rather than later. Today's GDP number should put those fears to rest.

This is what has gotten both gold and silver in such a tizzy this AM. Hedge fund shorts in silver in particular, that were put on below $31 are now being forced out. Same goes for gold shorts by hedge funds that were put on below $1660, those too are being covered. The reason? Traders are now revising their views of any premature end to QE4; based on today's contraction, it ain't gonna happen anytime soon.

I am going to wait until later in the day to see how the pit session closes and in particular, how the S&P 500 REACTS  before doing any charrting as I want to see those before making any conclusions as to near term technicals.

One thing I do want to point out however is that in spite of the pitiful GDP numbers, the bond market is FALLING. This is to me, perhaps, the most important price action of today's session. One would have expected slowing growth to rev up bond buying; it is not. The opposite is what is happening. The yield on the Ten Year note is now OVER 2.0% as I type these comments. We will have to monitor this extremely closely. Something big might just be afoot!

Gold price spikes higher as US heads back into recession

Posted: 30 Jan 2013 07:56 AM PST

Finally some semblance of reality looks to be heading back into the US economy as it prints a 'shock' negative number for Q4 GDP – the market was expecting a positive print of 1.1% –...

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This Is What A Bondpocalypse And Currency Collapse Looks Like

Posted: 30 Jan 2013 07:52 AM PST

Why Did You Purchase Gold in the First Place?

Posted: 30 Jan 2013 07:39 AM PST

I received quite a few comments on my piece from over the weekend and wanted to expand on it a little bit.  THE most important question to ask yourself right now is "Why did I purchase Gold in the first place?"  Many will come back with answers such as "Because I was afraid of inflation."  Yes, inflation.  Not what the government tells you inflation is, not the bogus rate that they release each month.  No; inflation.  Inflation as in what your own eyes and pocketbook tell you.  Inflation as in the central bank (of whatever country or zone you reside) printing too much money.  Inflation as in your Treasury department needing to borrow more than what the marketplace is willing to lend so the central banks steps up with newly minted cash to buy whatever is necessary.  Just good ole' plain inflation.

Or maybe you are a fiscal conservative and started buying Gold because you were afraid that your government would go broke?  Or that your "King" was spending too much or borrowing too much.  Or maybe he (or she) was "messing" with the money and clipping corners?  Maybe in an effort to keep the "natives" from becoming too restless your "governor" made promises?  Lots and lots of promises… you know, the types that can never be kept!

Or maybe you were afraid that the banking system was going to come down.  Maybe you are (were) some sort of financial skeptic (terrorist) who saw what the banks were doing and figured out that it could lead to no go good.  Maybe you didn't trust the banks to hold your money?  Maybe you stuck money under your mattress?  Maybe you came to distrust the "money" itself?

There are a myriad of reasons why YOU may have purchased gold and silver a couple of years ago.  A myriad as to why you did the same 10 or even 15 years ago.  Yet, now you are questioning yourself.  You are questioning yourself because Gold didn't "go up" 20% last year and you're thinking "O my God, should I sell it while it's still worth something?"  Don't laugh, many people over the last couple of weeks have become almost suicidal in their fears that "Oh no, what if gold goes 'down' further?"

Let me put this in perspective for you.  ALL of the reasons that you may have originally made your purchases of gold and silver… are just NOW coming true!  Well, not just "now" but they are certainly "coming to a head" now.  Believe it or not, the common sense that you employed originally… was correct.  Yes, you figured it out!  And the best part is that you figured it out early!  …before the rest of the crowd!  But, now, you are questioning yourselves because everything that you thought was going to happen has happened yet the banks haven't closed, your Dollars, Euros and Yen still spend and SNAP cards and Obamaphones are still working and online… so… you must have been wrong???

Wrong?  Not at all, you were right.  Really right and right for all of the right reasons!  (scary huh?)  But, because of the current production of "Wag the Dog," you are missing the reality of the situation.  ALL of what you expected to happen IS happening and is going to continue to happen… faster and harder as time goes by.  I have to ask each one of you this question.  Back in the early 2000′s did you think that Jim Sinclair was crazy talking about $1,650 Gold?  Yes?  No?  Did you think that if we ever had $1,650 Gold you would be rich beyond your dreams?  Did you think that you'd be "scared" out of your wits like you are now or did you even think that the system would still be working  and functioning as it still seems to be today?

Would you like the reality of the situation?  The entire sovereign world is broke!  The banking system is broke!  The currency mechanism and currencies themselves are worth ZERO!  The derivatives market has been hypothecated and rehypothecated 10 times or 100 times over.  NOTHING can perform as it promises.  Gold on the other hand will perform.  It IS money and will have value and can be used when… drum-roll please … NOTHING ELSE can or will which is exactly why you purchased it and now own it in the first place.

So, please relax.  Please understand that you were correct and correct for the right reasons and are only now becoming fodder for misinformation trying to separate you from your gold.  YOU are not a fool right?  You know what they say about fools and their money?  If you were a fool?  You wouldn't already own gold and be the target of those who have already run the system into bankruptcy.  End of story!Similar Posts:

Why Isn’t Gold Higher?

Posted: 30 Jan 2013 07:35 AM PST

Hint: Because it's the Credit Default Swap of the Next Financial Crisis Credit default swaps were the insurance—the hedge—against exactly what happened in 2008: Bonds threatened to default, during the Global Financial Crisis. So the CDS's insuring those bonds rose … Continue reading

Swiss banks to offer allocated gold and silver accounts

Posted: 30 Jan 2013 07:35 AM PST

Swiss banks UBS and Credit Suisse, have moved to offer allocated gold and silver accounts to their clients — including high net worth individuals, hedge funds, other banks and institutions.

Gonzalo Lira: Why Isn’t Gold Higher?

Posted: 30 Jan 2013 07:30 AM PST

Hint: Because it's the Credit Default Swap of the Next Financial Crisis Submitted by Gonzalo Lira Credit default swaps were the insurance—the hedge—against exactly what happened in 2008: Bonds threatened to default, during the Global Financial Crisis. So the CDS's insuring those bonds rose in value—until suddenly, they didn't: CDS's stopped rising in value just [...]

Finally MP’s get told that money printing (QE) is a ‘monstrous mistake’

Posted: 30 Jan 2013 07:28 AM PST

Finally someone with guts has sat in front of MPs and told a very uncomfortable truth, something that we've been banging on about on these pages for the past couple of years,  namely that the money...

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Swiss Banks Begin Offering Allocated Gold & Silver Accounts

Posted: 30 Jan 2013 07:00 AM PST

Swiss banks, UBS and Credit Suisse, have moved to offer allocated gold and silver accounts to their clients – including high net worth, hedge funds, other banks and institutions.  The move allows these entities to take direct ownership of their bullion in allocated accounts. According to the Financial Times, the banks say that they are [...]

Gold finds central bank support as ETFs dump holdings

Posted: 30 Jan 2013 06:56 AM PST

The gold-backed ETP holdings fell 22 metric tons from the Dec. 20 peak to 2,610.272 metric tons on Jan. 27. As the economy recovers, investors' appetite for gold may have decreased.

BioTime (AMEX:BTX): The scientific term for those cells is “immortal,” because they don’t age.

Posted: 30 Jan 2013 06:43 AM PST

Virtual Immortality “I’m gonna live forever. That’s why I love Keiser Ethical Silver.”

Gold & Silver Go Vertical on COMEX Open

Posted: 30 Jan 2013 06:10 AM PST

After consolidating around $31.40 and $1665 throughout the overnight Asian and London sessions, both gold and silver have just made significant vertical moves to the upside on the COMEX open, ahead of this afternoon's Fed announcement at 2:15pm EST. Silver has made an .80 vertical move to the upside to $31.98, and gold added $20 [...]

Germans want Gold reserves returned

Posted: 30 Jan 2013 05:37 AM PST

Germany has been facing mounting pressure to audit its national gold holdings from various political groups. Some leaders also want all of the nation’s gold brought back home, so Germany’s Bundesbank last week publicly revealed its plans to repatriate half of its gold.

Swiss Banks Offer Allocated Accounts As Move To Allocated Internationally

Posted: 30 Jan 2013 05:12 AM PST

Allocated Vs Unallocated? Unallocated storage leaves the investor an unsecured creditor of the provider, while with allocated storage the customer owns the gold directly and  it cannot become encumbered.  Today's AM fix was USD 1,666.25, EUR 1,230.70, and GBP 1,057.20 … Continue reading

Euro passes $1.35 for first time since 2011, @maxkeiser and @JamesGRickards were right!

Posted: 30 Jan 2013 05:09 AM PST

Stacy Summary: The only three prominent financial commentators who were from the beginning more bullish on the euro than the dollar or pound were Max Keiser, Jim Rickards and Jim Rogers. They were discussing this two and three years ago; … Continue reading

Gold outlook bearish in short term as Fed meeting looms

Posted: 30 Jan 2013 05:04 AM PST

Indian exports of gems and jewelry are expected to rise by 15% this year to more than $44 billion, with silver exports seen jumping 30%.

US Mint Sells Another 300k Silver Eagles, Extends Monthly Sales Record to 7.42 Million!

Posted: 30 Jan 2013 05:00 AM PST

With allocated/rationed silver eagle sales beginning again on Monday 1/28, the US Mint reported another 300,000 silver eagles sold Tuesday, nearly 1.5 million since production was restarted Monday, and increased January's all-time monthly sales record to an astonishing 7.42 million silver eagles, 53 times the volume of gold purchased from the US Mint in January! [...]

Australia's Bass Metals finally sells Tasmania Gold mine

Posted: 30 Jan 2013 04:48 AM PST

Analysts said the Hellyer mine sale will allow the Perth based Bass Metals to clear its debts and begin new exploration projects.

This Artificial World Will Lead To Gold's Revaluation

Posted: 30 Jan 2013 04:28 AM PST

A few months ago, we published "Invisible Experiments With Money and Gold" which was the result of Q&A with the authors of the book "The Silver Bomb" (available on Amazon.com and highly recommended reading). The article went truly viral. With so many positive comments from readers, we are following up with a new Q&A. In it, we look at the fundamental functioning of our society. The authors believe that the inevitable unmasking of today's (artificial) world will lead to increased transparency on a large scale and an appreciation of gold.

The authors Michael MacDonald and Christopher Whitestone have a fundamentals based view and put human behavior at the epicenter of the world. They fully agree with Jim Grant who once pointed out that "we are playing in a rigged casino," pointing to the figures that are communicated by officials which are artificial and manipulated.

Chart analysis was useful as a historical record of events. Charts allow us to look back and see the effect of actions in the market. Hence, it allows us to anticipate to some degree. Christopher Whitestone confesses the following:

"I doubt if anticipating the future based upon charts is effective anymore. The real things that affect the market are not chartable. They have to do with decisions at the top, in a world where the markets are in a complete reaction to central bank delivery of never ending money base expansion. Technical charting cannot take into account the actions of power structures. It's not about whether the supply is up, demand is down, or another fundamental economics formula. The point is now whether the fake supply is up or fake demand is down."

The world in which definitions are completely destroyed

Things are not what they appear to be. The media has become a mouth piece of those that literally own it. They have created their view of the world. We live in a time where the mission of the media as the social watchdog to keep the rest of us informed has completely changed. It has therefore become a propaganda broadcasting system.

In this world, the definitions of things are completely destroyed. What the creditor calls debt, the borrower calls money. We have now this debt based system which is already a perversion of the concept of money. Money is created when debt has incurred and not the other way around. Money in existence was once obtained through trade with equivalent goods or services and could also be advanced in the form of a loan, which is a positive currency. That is the opposite of what we have today, a debt based currency, which is a negative currency.

The trillion dollar coin story was the most recent public "farce" that proves this point. As the central bank keeps track with the mood of the people, they see as well that the metals are growing in popularity while at the same time they ignore that metals are money. The forces that appreciate the metals are simply too strong. The Official Monetary And Financial Institutions Forum confirmed this very recently (source).

The old problem/reaction/solution idea is at the epicenter of our world. Whenever there is a needed outcome, the fastest way to achieve it is to create a problem for which that outcome is the desired solution. It is easily demonstrable that most wars (if not all of them) and major economic shifts have begun by an event (or series of events) with historically dubious origins.  Some of them, later, were fully revealed to have been lies. Think about the US – Vietnam conflict as a well-known example. The escalation of the war in the Gulf at the time of the Tonkin incident was used to get the US populist behind an escalation of the war. It turned out 40 years later fully admitted to have never happened.

More recently, a bombing attempt on the NY Fed building was executed by a 21 year old Bangladeshi cyber security student. This turns out to be just like so many other stories; it has been the subject of a sting operation. This is exactly the story that we were told about the first WTC bombing where the go-between handlers were asking harmless powder while the FBI was giving them real explosives.  A couple of days ago, citizen journalists reported a dubious role of the US President in Benghazi-gate.

Quote from book The Silver Bomb: "The era of debt-based economy, which is dependent upon the creation of debt, which is leveraged with still more debt will draw to an end. The free-fall will come to a sudden stop and a hard reset of the respective values of all commodities and currencies will occur. The banks are already preparing for the paradigm shift."

Gold 's revaluation

The above discussed trend is the trigger for gold's revaluation, which will come into play as soon as a large scale awareness hits. The authors believe that the present gold bull run is in its infancy. There are early signs of a second stage, like the most recent huge increased metal accumulation by the SLV and the exploding premiums for silver and gold coins in the East, among many other events. GATA is pushing for transparency with, resulting in the publication of a secret IMF report in which the gold price suppression has been documented. It is still a very small percentage, but clearly growing number of people who become aware and take action to position themselves in advance of a coming real movement. If markets are anything, they attempt to anticipate the future effect of present situations. Markets are currently reacting to the artificial change in what constitutes the markets, which is monetary stimulus. The monetary stimulus has created an understanding of the diminishment of the value of the existing currency, which makes alternative currencies (including precious metals), to look more stable and attractive.

The authors do believe that gold's revaluation is going to hit quite sudden. Hemingway said about bankruptcy that it happens slowly at first and then all of a sudden. It will be similar in gold, which reflects the bankruptcy of faith based currencies. We will probably see some trigger points like the recent announcement from the OMFIF proposing the re-monetization of gold, Japan's devaluation which brings currency wars center stage, central banks' gold repatriation, etc.

The central bank precious metal repatriation efforts are concurrent with a vigorous game of hide-and-seek, as physical delivery of precious metal commodities exchange warrants and specific lot certificate s gets more and more dicey. Moreover, questions about whether allocated holdings of gold have been re-leased, re-hypothecated, or simply removed are highlighted by events like the tidbit described in the following Wholesale Gold Group news item: CME Declares Force Majeure and blames Sandy for "Operational Limits."

Speaking of central banks, it has now become pretty evident that there is a global central bank effort to hedge their bets. We see the grab for gold by the central banks. It could indicate that "the powers that be" are preparing for a fractional backing of currency with precious metals. The talks about backing our currency again with gold became visible last year in the Senate's proposed legislation "2012 sound money act." It's an attempt to compel the Fed to at least evaluate the gold market with respect to the interest rates positioning and setting the value of the dollar. There is action at the state level as well. Illinois, for instance, could become the first US state to prepare new rules in precious metals buying and owning while Utah is striving for the opposite. This, as well, is helping to bring the precious metals center stage.

The book "The Silver Bomb" is recommended literature, available on Amazon.com. Furthermore, the authors of the book offer physical bullion at beneficial conditions via Wholesale Gold Group, a trusted service.

India's top Gold sector body releases pre budget expectations

Posted: 30 Jan 2013 04:16 AM PST

With 28 days to go for the Union Budget, the Gem and Jewellery Export Promotion Council (GJEPC) has announced its expectations for the Indian Gem & Jewellery sector.

PUNT THE BERNANK!

Posted: 30 Jan 2013 04:00 AM PST

Just because QE5 is not expected today when the January FOMC statement will be released at 12:30 EST, that doesn't mean that SD readers don't need a good dose of PUNT THE BERNANK!   Freedom Girl Now Available From the Silver Bullet Silver Shield Collection at SDBullion.com!!   Make a game | Punt TheBernank | [...]

Kitco Corrects Their Gold Lease Rates Error

Posted: 30 Jan 2013 03:53 AM PST

Le Café Américain

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