saveyourassetsfirst3 |
- Gold sector clean out expected in 2013 – Cook
- The Inflation – Deflation Reality in 2013
- Sprott and Biderman Sunday
- Sprucing Up Your Buy And Hold Portfolio
- New Freeport Still Worth A Look
- The economics of gold and silver in 2013
- One image that explains why Gold is the opposite of being in a bubble (in fact, the real bull market for Gold and Silver hasn't even started yet)
- Like Goldilocks, Gold May Surprise the Bears
- A one picture summary of what JP Morgan meant when he said, “Only Gold is money, everything else is credit.”
- Gold And Silver – Who (What) Do You Trust? You Have A Choice.
- Gold Rush: Faltering France hit by wave of jewelry robberies (good thing there's no inflation and Gold is ‘worthless' according to fiat money advocates)
- New York Times Article Tells Big Lies on Impact of Fiscal Cliff Deal on Rich v. Ordinary Americans
- Eric Zuesse: Understanding President Obama’s Strategy to Force Cutting Social Security, Medicare, and Medicaid
- If the Fed backpedals on QE it would instantly crash the bond market so this is not going to happen
- Futures Traders Erase Bets for Euro Drop Against U.S. Dollar
- The Principle Of Capitalization Of Incomes
- James Turk ups his $8,000 an ounce peak gold price forecast to $11,000
- THE TRILLION DOLLAR TUNA IDEA
- Silver Update: FED Follies
- Brent Cook: How to Turn Rock into Money
- Silver 2012: A Year In Review
- Why We’re Ungovernable, Part 6: Here Comes the Debt Ceiling
- Gold Price in January 2013
- How to turn a $30 Keiser Ethical Silver round into $406
- 2013 – The Year of the Gold Bull?
- Massive US Mint Gold & Silver Bullion Sales Are A Bullish Omen
- US Mint Bullion Coin Sales
- GoldCore: Gold in Manipulative Selloff? Nice New Year's Gift
- Q&A With The Doc: This Silverbug is Ready to Throw in the Towel As Silver Has Gone Nowhere in 2 Years
- Jobs report/155,000 added/Spain's pension funds run out of room to purchase Spanish bonds/ Huge sales in gold from USA Mint in January/
- US Mint Bullion-Coin Sales 3
- Confiscation of Gold – Then What? Part 4
| Gold sector clean out expected in 2013 – Cook Posted: 06 Jan 2013 11:07 AM PST Brent Cook, co-editor of the Exploration Insights newsletter believes much of the froth has now been washed out of the junior market. An interview with The Gold Report. |
| The Inflation – Deflation Reality in 2013 Posted: 06 Jan 2013 10:33 AM PST Submitted by Deepcaster: The five year chart of the CRB Index (a Broad Measure of Commodities Prices) shows three descending tops, which is suggestive of Deflation. But to conclude that Deflation is likely to be The Ruling Force in the Economy in 2013 would be a Dangerous Error. Indeed, it is critically important for Investors [...] |
| Posted: 06 Jan 2013 08:56 AM PST We found the KWN audio interview with Eric Sprott (Sprott Global) interesting and worthy of sharing.
More... We also found the video below from Charles Biderman (Trim Tabs) worthy of sharing.
https://www.youtube.com/watch?list=UU_FouojmbzN_jwBVkroDQBw&v=AaT8yMS9B7U&feature=player_detailpage Biderman sounds a similar theme in this next video from the day prior.
https://www.youtube.com/watch?v=JRwEKCMMw6s&feature=player_detailpage&list=UU_FouojmbzN_jwBVkroDQBw |
| Sprucing Up Your Buy And Hold Portfolio Posted: 06 Jan 2013 07:07 AM PST By Adam Aloisi: I've been forever miffed by the simplistic Wall Street investment vernacular of 'buy, sell, or hold." For those of us who've been around the block a while, we know that sell-side firms are skewed to a positive bias on security recommendations, and that "hold" is generally a veiled queue for clients to look for a better opportunity. A "buy" rating usually means the obvious, whereas "strong buy" seems to connote some unheralded urgency that "buy" alone cannot communicate. On the rare occasion a "sell" recommendation is slapped on a stock, it is usually a day late and a dollar short, normally issued following an earnings miss or other corporate disappointment, with no preemptive value. My point is whether we look at securities as a trade or a longer-term investment, nothing is usually as simple (or accurate) as buy, sell, or hold. Investors need to look past the simplistic nomenclature of Complete Story » |
| New Freeport Still Worth A Look Posted: 06 Jan 2013 06:17 AM PST By In early December, Freeport-McMoRan (FCX) announced it was buying two oil and exploration companies, McMoRan Exploration (MMR) and Plains Exploration and Production (PXP). The deal was received very negatively by the market; Freeport's stock fell roughly 20% in the two days after the deal was announced. The deal diversifies Freeport's revenues from a pure mining operation to include E&P activities. The deal also means that Freeport is no longer one of the purest ways to gain exposure to copper prices and risks alienating the investor base which use Freeport to gain exposure to copper. To compare pre and post-merger revenues, I compiled a table of revenues from the three companies and categorized them. I then took the percentage of revenues from each of the categories for Freeport as an independent company and all three components as a whole. The revenue values used are from each company's CY 2012 Q3 earnings Complete Story » |
| The economics of gold and silver in 2013 Posted: 06 Jan 2013 06:00 AM PST The New Year should see some major changes in how gold and silver are regarded in the West, if it becomes obvious that confidence in government-issued money as a medium of exchange might be misplaced. ...  |
| Posted: 06 Jan 2013 05:03 AM PST |
| Like Goldilocks, Gold May Surprise the Bears Posted: 06 Jan 2013 05:00 AM PST Submitted by Morris Hubbartt: Note how oversold gold is, compared to the euro. A strong buy signal for gold is now in play, and the last time one like this occurred, gold doubled in price, over the next three years. I don't want to be predicting pies in the sky, but any rational investor [...] |
| Posted: 06 Jan 2013 04:59 AM PST |
| Gold And Silver – Who (What) Do You Trust? You Have A Choice. Posted: 06 Jan 2013 04:57 AM PST If you collect the money, you disperse the people; If you disperse the money, you collect the people. -Chinese Proverb Nobody understood that better than the moneychangers, today known as central banks. It is the Rothschild creed that has worked for centuries. Remember the "other" Golden Rule: "He that owns the Gold, Rules." It is indisputable that for centuries, gold has always been considered a store of value. It preserves one's wealth against fiat currencies, and during times of fiat upheavals, it also creates wealth. With wealth, one has independence. With independence, one need not rely upon government. While governments can control people, the Rothschild clan chose to control governments, with control over people a handy by-product…a Cliff Notes version of the New World Order. When you take away the gold from anyone, you take away their independence. "I hereby declare, by Executive Order, that every US citizen turn in his gold or suffer fines up to $10,000, or be sentenced to 10 years in prison" Socialist-extraodinaire, Franklin Delano Roosevelt. What did all these people get in return for their gold? Paper currency, then and still issued by a private corporation called the Federal Reserve. That Congress had abdicated its Constitutional obligation to "coin money," [Article I, section 8], was no longer important, for the organic Constitution had been replaced by a corporate federal version, deceitfully designed to look like the original, but that is another story, and the moneychangers control the corporate form of government. [Let us leave it at the fact that this country was formed as a Republic, NOT a democracy. In a Republic, the Right of an individual is protected against the will of a majority. In a democracy, an individual, even small groups, have NO protection against the UNLIMITED power of the majority, now usually ruled by one, as in Executive Order. Google the difference between a Republic and a democracy and maybe learn something. The Founding Fathers EXPRESSLY CHOSE a Republican form of government over a democracy, for a reason.] What happened to the price of gold AFTER people turned it in? [People received $20.67 the ounce for their gold, by the way.] Roosevelt increased the official price to $35/oz! Did the value of the paper currency people were holding also increase by 70%? [Only one guess.] "All the perplexities, confusions and distresses in America arise not from defects in the Constitution or confederation, not from want of honor or virtue, as much as from downright IGNORANCE OF THE NATURE of coin, credit, and circulation." -John Adams Now, [with no gold, ergo no wealth] almost half the American population receives food stamps from the government, and the elderly are dependent upon Social Security, Medicare, etc, all largesse from the corporate federal government teat. Most all Americans are also drowning in debt, foisted upon them, as planned by the moneychangers, keeping them all credit-addicted and unable to accumulate any real wealth, aka independence. As Chuck Colson, Special Counsel henchman to "Tricky Dick" Nixon, heartlessly reiterated: "When you got them by the [financial]balls, their hearts and minds will follow." This brings us back to the second line of the Chinese proverb: "If you disperse the money, you collect the people." The corporate federal government is in the business of collecting people. Serfdom is alive and well in the USA. Yes, there is a point to this. What are the controlling influences for ANY market? Supply and demand. Who determines and controls the supply of fiat? The central banks. Who determines the demand side? You! A collective "You," to be sure, but the collective is composed of individuals, and you have a choice. What happens when demand wanes vs an ever-increasing supply? The "value" of the supply collapses. Of course, keep in mind fiat has NO VALUE! It is purely imaginary. Take a minute to absorb that thought. IT IS PURELY IMAGINARY. If you imagine something has value, it does, by virtue of your belief. A belief is NOT reality. It is merely a thought maintained ABOUT reality, but not necessarily the reality itself. Change the belief and you change the reality. Stop believing fiat has any value, and your reality about fiat changes, as well. "The Emperor is wearing no clothes!" Gold and silver are NOT going up in value. An ounce or gold or an ounce of silver is still the same ounce. It is the imaginary "value" of the fiat you hold that is being debased and is relentlessly dropping. It is a subtle, but necessary change in "belief" one must always recognize, [and there are many who do, just not enough]. Instead of 250 or 900 units of fiat, it now takes 1650 units of fiat to purchase the SAME ounce of gold, and 30 units of fiat, instead of 5 or 20 units to purchase the same ounce of silver. Make no mistake about it, it is the central bankers that are leading governments around by the nose, and by proxy, governments leading people around by the nose, and that "nose" is inhaling "lines" of fiat. Unless cured, all addictions end badly, and the only "cure" central bankers have for ever-increasing fiat is, ever-increasing it more. Despite the above circumstances, very few Americans actually own physical gold and silver. The numbers are greater through participation of paper holdings of gold and silver. A mantra everyone needs to learn, if you have not yet is, "If you do not hold it, you do not own it." Just ask Germany if it still "owns" all its gold held outside of its country, like in London and New York. Usually, there is some degree of loyalty among thieves…apparently not, when it comes to gold. Rich irony. Think MF Global… Peregrine… Where do you want your gold and silver to be when the elephants start stampeding? There is already a rumbling in the distance. You have a choice. Back to our last point. Not enough Americans own and hold the actual physical. The numbers are growing…a record 50,000 oz of gold Eagles were sold in January, but what are ounces when compared to tons? Remember the supply/demand factor. Do you want to make your "vote" count? Demand less of the valueless fiat, and keep, and grow your wealth by buying and accumulating real value: physical gold and silver. Anything less, and you are still dealing in the imaginary world that is failing. Let the fiat fall where it may, and it will fall, with or without you. Better that it falls without you. There will come a time, and we keep getting closer to that still unknown time when gold and silver will rise as many imagine possible, and most will not believe. You have a choice. [At least for now] For the first time, we are not going to include any charts for gold or silver. In the larger scheme of things, they do not seem as important. [There is no reason to be long futures, yet] We have said repeatedly, buy the physical NOW, while the buying is good. Back in 1933, by government decree, [central banker dictated], people turned in their gold at $20.67…a Gordon Brown moment. Today, gold is $1,650. Get thee to a dealer'ry; why wouldst thou be a breeder of fiat! Who [what] do you trust?
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| Posted: 06 Jan 2013 04:19 AM PST Those who argue that in a financial collapse everything collapses including the price of Gold are ignoring 10,000 years of human history. Gold came before central banks and will be here after they collapse. As JP Morgan himself said, 'Only … Continue reading |
| New York Times Article Tells Big Lies on Impact of Fiscal Cliff Deal on Rich v. Ordinary Americans Posted: 06 Jan 2013 03:30 AM PST If the media was licensed, the New York Times story, "After Fiscal Cliff Deal, Tax Code May Be the Most Progressive Since 1979," would be grounds for disbarment. I flagged the piece as a Big Lie in comments yesterday, and figured that since anyone who was either old enough to have been paying taxes in the 1980s or had minimal Google skills could ascertain its claims were nonsense, that it would be debunked elsewhere. Instead, it was apparently tweeted actively by soi-disant liberals on Saturday. This piece is one of a series of changes over the last month of so of a ratcheting up in the propaganda war against what is left of middle class America. It appears that the effort to sell citizens the necessity of cutting Social Security and Medicare has led our fearless leaders to take us across an event horizon into a late Soviet "all propaganda all the time" footing. What is disconcerting now is the frequency with which articles that are thinly veiled media plants are run uncritically, and the intensity with which they are touted on Twitter and other social media. Post election, I've seen a big increase in newbie commentors running right wing talking points in an effort to re-educate the NC readership. The New York Times has moved decidedly to the right after the crisis, as has the Financial Times, and both have been trumpeting how the bad the debt problem is and why Something Must Be Done. "Something," of course, is goring your ox, a point that will be kept largely out of view until it is too late for the public to do anything about it. It's easier to demonstrate how much things have changed over longer time frames. Look at this section of a March 2010 post, "The Empire Continues to Strike Back: Team Obama Propaganda Campaign Reaches Fever Pitch." Notice how I have to set up the use of the "p" word because it would have been seen as screechy and histrionic to come flat out and say, as I did not much later, that Obama thinks the solution to every problem is better propaganda.
And that is precisely how things have played out, except I was not pessimistic enough. I thought the inevitable lousy economic outcomes would catch up with Obama, when the combination of yet more PR and an unbelievably weak Republican opponent has allowed his to continue beyond his sell-by date. Matt Taibbi's latest article, "Secret and Lies of the Bailout," provides this scathing summary:
Be sure to read the Taibbi piece in its entirety. The campaign to whip up hysteria over the phony fiscal cliff/debt ceiling is depressingly similar to the trumped-up Iraq WMD theatrics, the "bail out the banks or The Times article is remarkably lazy; it relies on an analysis made by the Tax Policy Center which claims that the top 1% will pay an "average federal tax rate" of 36% this year. The sneaky bit here is the use of "average federal tax rate." This term is not defined and is most decidedly not a standard, recognized term. The only thing you care about in analyzing tax burdens is the marginal tax rate (how much do you pay on each new dollar earned) and the effective tax rate (taxes paid/income). Everything else is bullshit. That 36% is most decidedly NOT an effective tax rate; the top marginal tax rate (on income in excess of $450,000 for couples filing jointly) will be 39.5%. And I cannot fathom how they claim the top 1% paid less in taxes in the early 1980s. I did my own taxes in 1982, I was not in the top 1%, and as a new MBA my top rate was in the top marginal tax bracket (50%). It's simply bollocks to claim this deal makes taxation all that progressive, much the less as progressive as it was in the 1980s. Did the Tax Policy Center forget that we ended welfare as we knew it, for instance? The mavens of income inequality, Thomas Pikkety and Edmund Saez, base their work on tax returns, and point out that they focus on the high end because they can't get the data to look at what happens to non-taxpayers, specifically, how much they benefit from transfers. Those have been strangled over the last three decades. The fiscal cliff fix is only a small reversion of the Bush-era big breaks to the rich. Dividends are still taxed at capital gains rates (they were taxed at ordinary income rates before); estate taxes are vastly lower than they were in the 1980s and 1990. And even on the Federal income tax front, this chart gives you an idea of how little the pact does to change the distribution of income across income groups, and actually leaves a big chunk of the affluent but not rich better off. From Richard Green: But the Times gave us a balanced view, by going to a tax expert from the right wing American Enterprise Institute, who says the taxes for low income people in the Carter era were really high! See! I'd like to have them unpack their analysis. The federal income tax rate on the marginal dollar of someone earning the minimum wage in 2012 is 15%. In 1982 it was just barely in the 17% bracket. But payroll taxes were 5.4% in 1982 versus 6.2% now, which is a major offset, since that is charged on every dollar of wages. This search for "balance" is merely a way to reinforce the message that we really do live in the best of all possible worlds. It just happens to be the best of all possible worlds for the 1% and its loyal minions. Both parties are in agreement on their plan to reduce the standard of living of the middle class; the big area of difference is how much they need to appear to take from the folks on the top of the food chain. The tax article illustrates is a change in tactics. We really do seem to have moved into Big Lie as the prevailing appproach. There isn't an effort to make a persuasive argument; we just have quotes from experts (and since all the big money is behind the deal, it's trivial to find experts who will say the interim pact was just grand) and some impressive looking but unsupported charts. In other words, the article presents a simple message with a thin sheen of expert holy water sprinkled on it so the amplifiers won't have reason to feel embarrassed. And let's face it, drowning out the opposition is much easier than allowing a real debate to occur.         |
| Posted: 06 Jan 2013 03:00 AM PST By Eric Zuesse, an investigative historian and the author, most recently, of They're Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010, and of CHRIST'S VENTRILOQUISTS: The Event that Created Christianity. In order to be able to understand the current debt-limit battle in Washington, here is the essential historical background: Although the U.S. Constitution's 14th Amendment states very clearly that "the validity of the public debt of the United States, authorized by law, … shall not be questioned," the so-called "debt limit," as it's currently known – which violates that Amendment boldly, by raising serious questions about "the validity of the public debt of the United States, authorized by law" – was instituted only in recent times. It was instituted in 1995, by the Republican-majority U.S. Congress, when Republican House Speaker Newt Gingrich tried to coerce President Bill Clinton to slash "entitlements": Social Security, Medicare, and Medicaid. He especially wanted to slash Medicare. The solid-Republican Congressional votes against increasing the debt-limit in order to pay "the public debt of the United States, authorized by law" did actually shut down the Federal Government, for the first time in history, starting on 14 November 1995 for five days, and then yet again on 16 December 1995 for 21 days. During those two periods, "non-essential" government services were suspended, while the "public debt of the United States, authorized by law" continued to be honored. The second federal shut-down ended on 6 January 1996, when the Republicans finally passed and the President signed "Public Law 104-94," a Joint Resolution to raise the debt-limit. This action – which until then had always been treated in Congress as routine – enabled the U.S. Government to resume and continue to function, and the federal debt to continue to be paid. Between that time and this, Congressional Republicans have insisted on their right to violate this provision of the 14th Amendment, and Democratic Presidents have not challenged that right. While Republicans have been determined to force cutting "entitlements," Democratic Presidents have been ambivalent about it. That is: Presidents Clinton and Obama have shown by their actions that they didn't/don't want to use the force of Constitutional law to counter Republicans' force of this new congressional precedent, of eliminating the previously routine nature of increasing the federal debt-limit. Clinton and Obama have accepted Republicans' option to violate the Constitution's provision that "the validity of the public debt of the United States, authorized by law, … shall not be questioned." During an early-December White House "Press Briefing by Press Secretary Jay Carney, 12/06/2012," the President's Press Secretary was asked "whether the President would invoke executive power and the 14th Amendment," and Mr. Carney responded: "This administration does not believe that the 14th Amendment gives the President the power to ignore the debt ceiling – period." In other words: Barack Obama was now officially on record as removing that weapon from the available arsenal in his negotiations with Congressional Republicans about the debt limit. They could now quote him as agreeing with them, that the change in Congressional custom that had taken place on this matter in 1995 was simply Congress's assumption of a power that Congresses had always had – nothing violating the Constitution at all. Barack Obama had previously caved to the Republicans without fighting, concerning his elimination of the public option from his "Obamacare," and more recently breaking his long-made promise never to compromise on increasing taxes on the top 2%, $250,000+, and he had also chosen not to hold Republicans' feet to the fire on the fiscal cliff; but now, the only thing that realistically remained in his arsenal of weaponry against Republicans' forcing slashes in Social Security, Medicare, Medicaid, regulatory enforcement, and many other vital government programs, was simply handed away by him, even well before the fiscal cliff came on January 1st. Clearly, therefore, Mr. Obama is determined to give Republicans much of what they want on these matters. He evidently wants to find a way to allow that to happen. He wants House Republicans to be able to block the Federal Government from paying its previously contracted debts, so as to force him to cut "entitlements." On all prior occasions in which Obama has caved on vital details before even negotiating with Republicans about them, he had the public on his side but caved by his own choice. Polls showed about a 2-to-1 support for the availability of a public option; polls showed about a 2-to-1 support for the $250,000 benchmark for increasing tax-rates. But Obama conceded on those matters because he had lied to Democrats – and even to many moderate Republicans – about those claimed goals of his, and his actions showed that he actually agreed more with the goals of congressional Republicans on these issues than he did with Democrats and others who, in poll-after-poll on them, showed that they agreed with his stated (and even promised) positions on them. Now he is repeating this same behavior, regarding cuts to "entitlements." Yet again, polls show that the public rejects raising the retirement age, reducing the inflation-measure in calculating benefits, and the other Republican-pushed measures; but Obama is doing all he can to help Congressional Republicans get what they want on these issues. Barack Obama had, even earlier, driven Nancy Pelosi and Harry Reid to fits with his back-door efforts to gut such "entitlements," as when he had appointed the conservative Democrat Erskine Bowles to serve opposite the extremely conservative Republican Alan Simpson as being the two co-chairs on the White House's "bi-partisan" federal debt commission concerning entitlement "reform." (The Commission produced recommendations that Congressional Democrats roundly repudiated for slashing entitlements, and that Republicans condemned for increasing taxes.) Obama had set this Commission up to deal with the soaring federal deficits that had been caused by Bush's 2008 economic collapse, by their using those federal deficits as an excuse to slash entitlements and thus produce even more suffering for the poor, at the same time as Wall Street was being bailed out. (Bowles was supported by the very Wall Street banks that were being bailed out by taxpayers. Simpson was a born conservative who followed in his father's footsteps as Wyoming's Republican U.S. Senator. His father had been quite extreme: "one of six Republican senators who voted against the Civil Rights Act of 1964.") So, that was a wolf-in-charge-of-chicken-coop type of operation, which Congressional Democrats opposed. Republicans opposed it because it would have meant increasing taxes – it wasn't conservative enough for them. Thus, on the very same day, 28 March 2012, when Bowles-Simpson was finally dashed in the House, the House passed instead the Paul Ryan budget, which Mitt Romney ended up running on, against Obama. The 2012 "election" was thus between two conservatives, one of whom pretended not to be. Yet again, Pelosi and Reid are tearing their hair out about Obama's deceits and his preemptory caves on vital issues. On January 4th, Pelosi in her weekly press briefing was asked about using the 14th Amendment to annihilate the Republicans' threats to violate the 14th Amendment, and Pelosi said, "I've made my view very clear on that subject. But I'm not the president of the United States." On the same day, Ryan Grim at Huffington Post bannered "Harry Reid Would Back Obama If He Bucks GOP On Debt Ceiling: Source." Reid "has privately told other Democrats, including President Obama, that if the administration used its constitutional and executive authority to continue paying its debts in the face of House Republican opposition, he would support the approach." The way this would work is: Republicans would repeat the 1995 shut-down cliff-hanger, and President Obama would cite the 14th Amendment, and possibly also the trillion-dollar-coin tactic, to continue paying the U.S. Government's debts; and the matter would then go to the Supreme Court to be adjudicated. But Obama has already, through his Press spokesperson, said that he won't use the 14th Amendment. That will leave only the coin-tactic, which is less likely to succeed. He has already publicly trashed his biggest weapon. Democrats in Congress cannot publicly say that they despise a Democrat in the White House, but the signs indicate that they do. On the other hand, what will be their response if the President continues along this path? Pursuing this trajectory would be far worse than anything that happened during the Clinton years. There is no way of knowing, ahead of time, what would happen if he does that.     |
| If the Fed backpedals on QE it would instantly crash the bond market so this is not going to happen Posted: 06 Jan 2013 02:07 AM PST Gold and silver sold off sharply at the end of last week and stocks hesitated to resume their New Year rally on news that the Federal Reserve's top committee is divided over continuing QE. But whatever their reservations the Fed really has no alternative but to continue its bond buying program or the giant US T-bond market would crash. Perhaps this will be a pattern going forward this year: a few doubts from the Fed minutes to put the wind up markets and then some more dovish noises and actions puts humpty dumpty back together again. Who's buying bonds? Say the Fed was to stop buying 10-year US bonds. As the Fed is buying around 60 per cent of these bonds presently then demand would fall, interest rates go up and bond prices crash. It would be a huge blow to bondholders and interest rates would have to go still higher to attract buyers. The impact on economic activity would be appalling. Could the Fed just slowdown its bond buying program? Then you would get the same story only perhaps more slowly until the market really lost its nerve. No having gone down this particular road, kicking cans down it all the time, the Fed is stuck with no way out but more and more QE. Now and again the financial markets may have to remind the Fed just how much they need this stimulus. It would be surprising perhaps if some Fed committee members were not losing heart. The Fed balance sheet is expanding far faster than the miserable recovery in the US economy. No way to stop QE However, a policy that staves of the worst and offers some hope is probably better than one the results in instant depression and economic implosion. We are also far from sure that this strategy will eventually bring about a solid recovery in the US – fighting a debt bubble with more debt never looked that clever but it's more immediately palatable than the alternative. In the 1970s the world stumbled though a similar phase of low growth and high unemployment with the printing presses running flat out. Eventually in 1980 the Fed felt the economy was strong enough to withstand the shock of higher interest rates but we seem years away from being in that position, if indeed it can be achieved this time. Reality and past precedent will restrain the Fed from abandoning QE anytime soon whatever committee members may say in their discussions. |
| Futures Traders Erase Bets for Euro Drop Against U.S. Dollar Posted: 06 Jan 2013 01:32 AM PST Futures traders reversed bets that the euro will decline against the dollar, wagering for the first time since August 2011 that the shared currency will gain, figures from the Commodity Futures Trading Commission show... Read |
| The Principle Of Capitalization Of Incomes Posted: 05 Jan 2013 10:00 PM PST Gold University |
| James Turk ups his $8,000 an ounce peak gold price forecast to $11,000 Posted: 05 Jan 2013 08:18 PM PST Gold Money founder James Turk is still expecting a 1:1 ratio for the gold price to the Dow Jones Index between 2013-15 as he predicted years ago. But he has just upgraded his forecast of the peak gold price to $11,000. Mr. Turk is hardly an off-the-wall gold bug. He's a quiet and sane commentator who got gold right more than a decade ago and provides a great service with his Gold Money facility for buying and storing gold in a secure place… |
| Posted: 05 Jan 2013 08:05 PM PST BANZAI7 NEWS—Irashaimasen! This is really thrilling for PhD morons, fiscal deadbeats, connoisseurs of fine sashimi and tuna noodle casseroles . An arcane idea that started on sushi chef blogs in the summer of 2011– that Tim Geithner should catch a … Continue reading |
| Posted: 05 Jan 2013 07:01 PM PST BrotherJohnF's latest Silver Update: FED Follies Silver Bullet Silver Shield Slave Queen Medallion at SDBullion.com!! |
| Brent Cook: How to Turn Rock into Money Posted: 05 Jan 2013 04:11 PM PST TICKERS: AMM; AAU, ADM, BSX, CDM; CDE, FRES, GWY, CTG; DPF, KAM, LYD, MAG; MVG, MRZ, RPM; RPMGF Source: Brian Sylvester of The Gold Report (1/4/13)
Companies Mentioned : Almaden Minerals Ltd. : Andina Minerals Inc. : Belo Sun Mining Corp. : Coeur d'Alene Mines Corp. : Fresnillo Plc : Galway Resources Ltd. : Global Minerals Ltd. : Kaminak Gold Corp. : Lydian International Ltd. : MAG Silver Corp. : Mirasol Resources Ltd. : Rye Patch Gold Corp.
The Gold Report: Brent, 2012 was difficult for many gold investors, and you paint a pretty bleak picture for certain junior mining companies in 2013 as well. Brent Cook: We've actually had two pretty tough years on the TSX Venture Exchange. It is off about 30% from its peak in 2012 and around 20% for the year. That comes on top of a 35% decline in 2011. I do think much of the froth is washed out and we will see some opportunities in 2013.
During the most recent boom years, 2009 and 2010, roughly $11 billion ($11B) was raised on the Venture Exchange. Most of that has been spent without much success. Going by John Kaiser's database of about 1,800 Venture Exchange listed companies, there are around 600 that now have less than $200,000 in the bank and a full 62% of the 1,800 companies have a median working capital of only $1.1 million ($1.1M) or less. These companies are trading at less than $0.20/share, which means that unless things improve dramatically in the next year, many of these companies are going out of business or will push excessive dilution on current shareholders just to stay alive. The Venture Exchange will truly be the land of the walking dead. This coming year will be a cleaning-out process that in the long run is good for the sector. TGR: The Exploration Insights portfolio was not immune to what happened in 2012. It was up 4% from early January 2012 to late November. Are you convinced all of the companies in your portfolio should remain there? BC: We've got to go through a cleaning-out process as well. We've had some real disasters, where the investment thesis didn't pan out. We've also had a couple of big winners. The majority of the stocks that we own are undervalued, but they have held up well compared to the indexes. I just finished reviewing our 2012 performance and we have so far done surprisingly well on stocks we bought and sold in 2012, with an average gain of about 49%. Unfortunately, the stocks we have held for over a year didn't do as well, taking our year over year average gain down to about 13%. I'll have the final numbers out in our Jan. 6 issue. TGR: What are you telling your readers to give them hope? BC: The truth. Hope is the worst reason to own a stock. We're not going to see $3,000/ounce (oz) gold, and we are not going to see junior stocks go to the moon this next year. If an investment thesis doesn't pan out, we sell and take the loss. If, however, the thesis continues to work, we hold onto the stock or buy more. This is very speculative money in a very high-risk sector. Unless the risk trade comes back into favor this next year, and I don't think it will, it's going to be another tough one for the explorers and junior miners. That's all negative, right? But this is the smart time to pick up selective companies that have something of value. This is when investors can make money by buying intelligently and patiently. We may not be at the bottom, but it certainly isn't the top. TGR: What sort of trading range do you see for gold in 2013? BC: What's more important to me than gold's trading range, at least with regard to the junior explorers, is that the industry is not able to supply new deposits and discoveries to replace what is being mined. This is a serious issue that in the long run bodes well for this sector. Since about 1995, the number of ounces discovered has been trending straight down. According to the Metals Economic Group, in 2011 approximately 10 million ounces (Moz) were discovered, but 83 Moz were mined. That gap in production versus discovery is the opportunity, regardless of the gold price, which I think is flat to marginally higher in 2013. TGR: A lack of discoveries is hurting the industry? BC: It's getting tougher and more costly to find gold. That is the real issue. A company that raises $5M gets half as far as it did eight years ago.
During the past six years, the major gold-mining companies have spent the equivalent of 40% of market capitalization developing new deposits. It is projected that they would spend another 60% of their capitalization developing the new mines they have on the books just to keep production even. Moving reserves to production comes at a big cost. I've posted an article on my website that goes into a lot more detail regarding the dismal state of both the gold miners and explorers that should help readers understand the depth of the problem and opportunity. TGR: Let's get into your process. One phrase you use a lot is: "How much is it going to take to turn this rock into money?" What calculations do you use to help determine that? BC: There aren't any easy numbers I can throw out there. Every deposit presents different challenges and companies spend tens to hundreds of millions of dollars figuring out how much it is going to cost to turn the rock into money. Actually, one rule of thumb is the cutoff grade used in estimating the tonnes and grade of a deposit. In theory, that cutoff grade should be what a company or resource estimator projects is the break-even point between making money and losing money. If the cutoff grade is, say, 0.5 grams per tonne (g/t), then I like to see an average grade that is at least twice that, say, over 1 g/t, because above that is where you really make the money, if the cutoff assumption is close. Then you've got to look at metallurgy. This is probably the most important aspect of any deposit once it has been found. For instance, an oxide deposit sitting on the surface in Nevada with a cutoff grade 0.2 g/t can still make money, whereas another deposit in Nevada at 5 g/t cutoff won't. It is highly variable. All that the retail investor can do is guestimate if the grade and tonnes are sufficient to cover the probable capital and mining costs. TGR: It's pretty easy for the average retail investor to get lost in a feasibility study. They are quite technical. I'm certainly guilty of this: It's easy to look at the internal rate of return (IRR) and judge a deposit based on that. Is there a way to determine whether the IRR number is realistic? BC: IRR is a good metric to look at, especially if it is after taxes. TGR: Is there a minimum threshold? BC: I think 20% after tax, although it depends on where the project is located and on the exploration upside. That upside is the intangible that often decides if a deposit gets bought or not. TGR: What are some practical ways a retail investor can do due diligence? BC: Talk to management. Get comfortable with the team. There are a lot of good people in this industry and they are not hard to recognize once you start talking to them.
Go to the company's website. How accessible it is? How much information does it give in news releases? Does it back up the data? Almaden Minerals Ltd. (AMM:TSX; AAU:NYSE) and Mirasol Resources Ltd. (MRZ:TSX.V) include details, details, details. Be wary of a company that puts out a news release with no maps, no sections and no data. Watch for news releases that report high grades smeared over long intervals, and always search for historical data from the property being promoted. Most properties have a history that gives you some insight into possible tonnes and grade. TGR: Almaden recently announced assays from four drill holes testing the eastern limits of the main zone at its Ixtaca gold-silver discovery in Mexico. The company has discovered gold-silver mineralization hosted in volcanic rocks versus limestone, and shale host rock in the rest of the deposit. What do you make of that? BC: I went down to Almaden's Ixtaca project two and a half years ago and bought the company then. This is a very big hydrothermal system and, potentially, precious metal deposit. The drilling to date has almost exclusively found gold and silver mineralization in sediments. My take is it's just touching the edges of the mineral system and the most recent drill holes are pretty encouraging. We'll see if Almaden can extend it 50 meters to the southwest or not. TGR: You don't believe that the company has found the heart of the deposit, but is Almaden any closer to the promised land? BC: The next drill hole will be either great or a bust, but is not the deciding factor for this deposit. The important aspect to me is that this is a big system, and big systems make big deposits. TGR: Some pundits have suggested that the success Almaden is having at Ixtaca has caused it to largely forgo the prospect generator model and focus on this deposit. Do you agree? BC: The company still has a number of projects ventured out, but you're right, it is drilling Ixtaca and will be drilling El Cobre. With the prospect generator model, a company generates ideas and vends them out when they get to be too high risk and costly. Therefore, the company doesn't dilute the shareholders to drill every low probability target it turns up. Most prospect generator companies are run by geologists who are good enough to recognize something above average when they stumble across it at which time they have the money and tight share structure that benefits long-time shareholders. It takes a long time to work through projects and find something worthwhile and this model addresses that problem. A number of companies have morphed out of that business model to the benefit of shareholders, including Almaden, Mirasol and Kaminak Gold Corp. (KAM:TSX.V). TGR: Have any other companies recently published important results? BC: Belo Sun Mining Corp. (BSX:TSX.V) just came out with 4.1 Moz Measured and Indicated and 2.8 Moz Inferred, or nearly 7 Moz at 1.7 g/t at its Volta Grande project in Brazil. That's a really strong resource number. These are broad coherent zones of mineralization. It'll be easy to mine. Yet, the stock's gone nowhere on the news. We can buy this company at the same price we could before the announcement, but it's got 2M more quality ounces. TGR: Is it a lack of faith or did the news get lost in a mass of information? BC: The sector has been so hammered that a lot of trading is now among a small circle of friends and enemies who are basically picking each other's pockets. That doesn't bode well for this next year. I don't know what it will take to bring new money in. We've got nearly $1,700/oz gold, but nobody cares. Without new money entering the sector we will struggle. TGR: Would a company like Belo Sun, given its board and the merchant bank that is behind it, have any trouble raising cash? BC: It's got plenty of cash. And its deposit will likely get bought down the road by a larger mining company. TGR: It also has an exceptional board that has turned over a number of companies. Can you mention another company? BC: Lydian International Ltd. (LYD:TSX) has a 3 Moz deposit in Armenia. It's an oxidized deposit that will have low processing and production costs. Capital expenditures are relatively low. A recent feasibility study shows a net present value at 5% with gold at $1,500/oz of just over $1B. That's a $1B valuation at $1,500/oz for a market cap of $250M. TGR: Is it falsely being priced as if Armenia were a risky country? BC: Perhaps. Based on my visit to Armenia, I don't consider it a risky country. Maybe it's such a new location that many investors are leery. TGR: Lydian recently announced that it was going to modify its crusher design and try to reduce the footprint of its Amulsar deposit. Is that a good plan? BC: It is. It will increase production, make it a simpler operation and make Amulsar more valuable. TGR: Does Lydian have the money to build it? BC: It has the money to move forward this year and will begin site development. It is my understanding that the International Finance Corp. (IFC) and European Development Bank want to put money into it. TGR: What are some other companies that you find interesting right now? BC: MAG Silver Corp.'s (MAG:TSX; MVG:NYSE) Juanicipio project in Zacatecas, Mexico, is probably the best or second-best undeveloped silver deposit in the world. MAG discovered the deposit with Fresnillo Plc (FRES:LSE). Fresnillo is going to put it into production. Because the deposit is part of its namesake silver district, and there are without a doubt more veins to be discovered, it would make sense for Fresnillo to buy MAG Silver's 44% stake, eventually. TGR: MAG also has silver at the Cinco de Mayo project. Will Fresnillo buy its interest in Juanicipio or do an outright takeover? BC: I don't know. Fresnillo is a rather secretive Mexican company and it is hard to know what it actually thinks. Cinco de Mayo is a polymetallic deposit. It's got silver, lead, zinc and copper. I'm not sure if that interests Fresnillo. My bet is that Fresnillo will take Juanicipio and MAG Silver will spin out Cinco and the rest of its projects into a separate company. I just don't know when. TGR: Rye Patch Gold Corp. (RPM:TSX.V; RPMGF:OTCQX) is in a legal battle with Coeur d'Alene Mines Corp. (CDM:TSX; CDE:NYSE) in Nevada. Is there any update on that dispute? BC: Rye Patch is making a bet that the mining law of 1872 holds up. I think it will, but it's going to be a long legal battle. Coeur d'Alene has a plan of operation with the Bureau of Land Management that it believes gives it priority over claims that it failed to keep current. However, if a company does not keep its claims up to date in the U.S., those claims are open to staking. It is clear to me what the end results should be but we are dealing with a David and Goliath scenario. TGR: Global Minerals Ltd. (CTG:TSX.V; DPF:FSE) hasn't done so well since you put it in the portfolio in March 2011, yet you still own it. Why? BC: Global Minerals has a good, easy-to-mine silver deposit in a Slovakian mining town. The infrastructure is more or less there. The underground silver and copper mineralization is there. I can show on paper that this project is considerably undervalued for its silver resource, and that doesn't even account for the exploration potential on trend. It is, however, a development story and these take time. TGR: Kaminak Gold Corp. published the first resource estimate on its Coffee gold project in the Yukon. It's 64 million tonnes at 1.56 g/t, which equates to roughly 3.2 Moz at a 0.5 g/t cutoff for the oxide and transitional material and 1 g/t cutoff for the sulfide material. What are your thoughts? BC: I was impressed. Kaminak came out with more ounces than I expected. The grade is pretty good. The oxide material is positive from a processing perspective. I was more surprised at how the market reacted, which was basically flat. Kaminak is the market darling in Canada. Good guys, new all Canadian discovery; everybody loves it. But it publishes a 3 Moz resource and the stock goes nowhere. TGR: If it were 2007 and Kaminak had the same deposit and the same resource, what do you think it would be valued at? BC: It would be at least double what it is now. Back in 2007, everybody was happy and smart. We were all making money. The hedge funds were pumping money into the exploration sector. Now it's just about the opposite. TGR: Maybe we never return to those days, but when will the market properly value these types of deposits again? BC: It may be properly valuing many of them now. TGR: Oh my. BC: There are a few deposits—Belo Sun, Lydian and a few others—that are definitely undervalued. But when it comes to the resource and exploration stages, the odds of making an economic gold discovery are about 1 in 1,000. How do you properly value that? Andina Minerals Inc. (ADM:TSX.V) was bought by Hochschild Mining Plc (HOC:LSE). It had about 7M low-grade, tough ounces up in the high Andes in Chile. It got about $10/oz and it may have overpaid. That's what it agreed to be paid, so we have to assume that that is a proper valuation for those ounces. TGR: Does a mine need to come into production and be successful before valuations go up in areas like Colombia, where there's a lot of exploration but not much coming up yet? BC: I was looking at the share prices of a number of companies that jumped into Colombia and put out initial results that many considered good. They excited investors with spectacular surface samples, and even some drill results. The results took many of the companies straight up and subsequently straight back down. Reality has set in. A lot of those discoveries turned out to be small plugs or narrow, high-grade veins that don't offer much size potential. For the most part, it was pretty obvious what was being promoted but people wanted to believe. Now they don't seem to believe anything. We only own one Colombian company: Galway Resources Ltd. (GWY:TSX.V), which was acquired and will be spinning out two new companies. TGR: Is there a company that could have a good 2013? BC: Mirasol. I've spent a lot of time with this group of geologists. They find deposits. They're good at it. They've made several discoveries in Argentina. Mirasol just sold 49% of one discovery to Coeur for $60M in cash and stock. It has another discovery it will be putting out a resource report on, and another it might release some good drill holes on. It has moved into Chile. You're paying $30M enterprise value for all of that and I'm willing to bet that the company makes another discovery in the next year or two. TGR: Is there a parting thought you'd like to leave us with? A crumb or two of hope? BC: This coming year is going to be a fantastic time to buy undervalued, high-margin deposits that the rest of the market doesn't recognize. The long-term prospects for the exploration sector look real good to me, but you better know what you are buying and why. I am afraid most of the fools have been washed out of the market. TGR: Thanks for that, Brent. BC: My pleasure. Brent Cook brings more than 30 years of experience to his role as a geologist, consultant and investment adviser. His knowledge spans all areas of the mining business, from the conceptual stage through detailed technical and financial modeling related to mine development and production. Brent's weekly Exploration Insights newsletter focuses on early-discovery, high-reward opportunities, primarily among junior mining and exploration companies. Cook will be speaking at the Cambridge House Vancouver Resource Investment Conference Jan. 20-21. Want to read more Gold Report interviews like this? 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| Posted: 05 Jan 2013 01:57 PM PST The Silver Liberation Army certainly looks forward to a 2013 in which the fundamentals do look stronger for silver. If silver's performance in 2012 could be summarized in one period, then 12/18-12/20 is it. After months of coordinated attacks on … Continue reading |
| Why We’re Ungovernable, Part 6: Here Comes the Debt Ceiling Posted: 05 Jan 2013 01:21 PM PST The fiscal cliff was always going to end with a whimper because that was the obvious path of least resistance. In the end, simply avoiding big tax increases and spending cuts while adding a few more trillion to the coming decade's deficit was rewarded by the markets with a huge rally. Everybody went home happy, or at least still in possession of their political office. Now we move on to the debt ceiling, which on the surface looks just like the fiscal cliff: A self-imposed set of penalties that can be finessed with the stroke of a pen. But it's likely to be far messier, for a couple of reasons. First, the republicans got rolled in the fiscal cliff deal because they couldn't stomach middle class tax increases and defense cuts. They were forced to raise taxes on their main contributors without cutting spending on the democrat base. This was a massive defeat for the supposed party of small government that cannot be repeated short of intra-party civil war. The other reason is that simply raising the debt limit (for the umpteenth time) might actually have some political downside this time around because it requires admitting that Washington's debt will rise by another $2 trillion in the next year or two, to around $18 trillion. The human mind doesn't grasp "trillion" very easily, but it does get round numbers like 20, which is now rapidly approaching. Put that new handle in front of something incomprehensible but ominous like trillion – and then note that a decade ago it was below 10 — and you have, as they say within the Beltway, an optics problem. The republicans can exploit this to demand spending cuts. The democrats will refuse on principal and counter with tax increases, and both sides will see a reasonable chance of blaming the other if the thing goes sour. So nothing will get done until checks actually stop being sent out. Here is the Wall Street Journal's Kimberley Strassel on the republicans' situation:
Some thoughts As a result both sides, left and right, see the other as having won. The left sees rapacious banks and corporations (the 1%) devastating broad sections of society while vacuuming up an ever-larger share of national wealth. The right sees ever-expanding entitlements and public sector unions crowding out wealth creators and turning the US into a socialist dictatorship (read France). Thanks to the magic of the printing press, they're both right. So here we are. Each side is so disgusted with the other that bipartisan compromise – which requires a degree of respect – is impossible. And even if it suddenly became possible, the imbalances are so huge that actually fixing the system by gutting both the military empire and the welfare state could never be sold to voters. Fiscal policy, in short, is on auto pilot and the "off" button is disabled. Defense spending growth can be slowed a bit, but only a bit since the right still views the US as the world's hyperpower and is willing to borrow whatever it takes to maintain this illusion. Entitlement spending can't even be slowed, given the fact that baby boomers are retiring and have the political clout to guarantee free health care and nice monthly social security payments for the next three decades. No one, left or right, is brave enough to explain to my generation that its demands will bankrupt their grandkids. Add it all up, and US federal spending will rise by 8% a year until the market, not the voters, decides otherwise. This puts all the pressure on monetary policy, the last relatively-pain free disaster-management tool. So here's a prediction for the near future: After a few weeks of entertaining political theater, the debt ceiling will rise enough to get through the next congressional election. The Fed will continue to buy up most newly-issued Treasury paper but at some point will begin making noises about ending QE. The markets will recoil (stocks will fall, revealing the massive underfunding of state and local pensions, among other things), and politicians will threaten the Fed's independence. Ben Bernanke or his successor will see no choice but to oblige with more QE. See Japan in late 2012 for a template.
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| Posted: 05 Jan 2013 01:12 PM PST
Based on the January 4th, 2013 Premium Update. Visit our archives for more gold & silver analysis. This week we've seen a decent rally in gold, silver and other precious metals and precious metals mining stocks, sparked off probably by the fiscal cliff deal. We have mentioned such a course of events many times and it turned out to be true. As is the case with any strong rally, there always comes a correction (or at least a consolidation) afterwards. The one that took place on Thursday was indeed of significant size but did not – in most cases – invalidate the rally. There were even cases that did not experience any correction at all, such as platinum that held remarkably well. Gold stopped at 200-day moving average, correcting around 72% of the rally. There was some turmoil in today's pre-market phase – gold and silver plunged dramatically, probably over the surprising information coming from the Fed about the possibility of ending the monetary stimulus. We doubt that this will really be the case, but it seems that this piece of information will manage to make those less convinced about the gold story to sell their holdings and this is what we've seen today before the market opened. But it seems that this was taken as a good opportunity to either enter the market or add to their positions by gold and silver investors – in the pre-market phase gold went below $1,630 and silver declined below $29.30 and at the moment of writing these words they are both significantly higher – at around $1,648 and $29.8, respectively – lower than yesterday's close but much higher than they were just a couple of hours ago. This only confirms the bullish outlook and could be viewed as a sign that the market doesn't believe that the Fed will actually stop pumping money into the economy. There is one more interesting thing that should be taken into consideration when analyzing such universal commodities as precious metals, traded on many exchanges and in many currencies, namely their price and behavior from other perspectives than the U.S. dollar's. This is why in today's essay we will try to address the title and figure out what the price of gold in the upcoming weeks will be, accommodating all the information we can get from the charts of gold priced not only in USD but in other important currencies. We'll see that the picture can change significantly with the change of the currency. Let us then jump straight into the technical part – we'll start with the long-term chart of gold priced in U.S. dollars and then move on to other currencies (charts courtesy by http://stockcharts.com.) In gold's very long-term chart, we do not see bullish implications this week. Gold's price is no longer above the 60-week or 300-day moving average, so the situation has deteriorated this week. The situation remains bullish for the medium term, however, in spite of these developments. This is based on similarities with 2009 and late 2006-early 2007. Gold consolidated after breaking out above triangle patterns in both cases. Let us now see how the recent developments looked like from the British Pound perspective. Thursday's declines did not change a thing as far as critical support lines are concerned (based on Thursday's closing prices). Breakdowns were invalidated in all cases and key support lines were not reached. In today's chart of gold from the perspective of the British pound, the previous statements hold true as they do for many other currencies this week. Gold's price here is exactly where it was one week ago. Let us now move on to the Canadian Dollar perspective. In this chart, the statements made in the previous section hold true as well here (again, based on Thursday's closing prices). Gold priced in Canadian dollars declined by less than 1% (twelve cents) in the past week and the recent breakdown was invalidated. Now, we'll move on to the Japanese Yen perspective, where the situation is even more interesting. The situation is definitely not the same here. Gold rallied nearly to the level of its 2011 high. This was about 2.5 % above last Thursday's close and gold priced in yen is now about 1.5% higher than a week ago. To finish off, let's have a glance at a chart that synthesizes the "non-USD" perspective, as it features gold price relative to an index of many foreign currencies. Here we see that the breakout above the medium-term declining resistance line has been confirmed and the breakdown invalidated. The medium-term trend remains bullish. More importantly, we see that this important ratio has some space before it moves to the declining support line, so perhaps it will not move below it today and the overall non-USD picture will remain bullish. Summing up, the situation has deteriorated a bit for gold from the USD perspective on Thursday, and the situation became mixed based on Friday's pre-market price moves. Even though the most part of these declines has been invalidated, the market is still lower than where it closed yesterday. The situation seen from the non-USD perspective remains favorable and this, plus the reversal seen just before markets opened today, makes the overall medium-term picture bullish. Use the following link to sign up for a free, no-obligation trial of our Premium Service and read the complete version of this study that is over 10 times bigger. You'll also receive Market Alerts on a daily basis and when the trial expires, you'll start receiving our free newsletter. Additionally, you will also receive 12 gold best practice emails. Thank you for reading. Have a great and profitable week! Przemyslaw Radomski, CFA * * * * * About Sunshine Profits Sunshine Profits enables anyone to forecast market changes with a level of accuracy that was once only available to closed-door institutions. It provides free trial access to its best investment tools (including lists of best gold stocks and best silver stocks), proprietary gold & silver indicators, buy & sell signals, weekly newsletter, and more. Seeing is believing. Disclaimer All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.  |
| How to turn a $30 Keiser Ethical Silver round into $406 Posted: 05 Jan 2013 12:59 PM PST People didn't believe me when I said Silver would reach $500. Here's the latest… I have just talked to a shop owner here in London who is so excited by the prospects of crushing the banksters and driving Silver prices … Continue reading |
| 2013 – The Year of the Gold Bull? Posted: 05 Jan 2013 12:22 PM PST
2012 wasn't a fun year for most Gold bulls. Seeing the S&P 500 outperform Gold and seeing Gold stocks get decimated through the 1st half of the year was enough to create suicidal sentiment that is now only marginally improved after another prolonged correction in the precious metals (PM) sector to end the year. But as the many calls for an end of the PM bull market by several of the same people who have been wrong / missed out the whole way up get louder, the risk in the PM sector gets lower and lower. The bigger picture hasn't changed and isn't going to for some time: a major private sector secular economic contraction in the West being fought with manufactured money/credit units by governments and central bankstaz. This is not a period to favor paper, as reflected by common stocks, over Gold. My trade of the year for 2013 is the same as my favored trade back in August: go long the "Gold to Dow" ratio (or short the "Dow to Gold" ratio). The secular chart of the S&P 500 (a broader index) to Gold ratio shows that time has run out for the paperbugs on this correction:  Of course, such a ratio chart doesn't tell us anything about nominal prices of either of these items. But it does tell us that a shiny piece of metal with no dividends or growth prospects should continue to trounce the wizards of Wall Street over the next several years. This is the forest one does not want to lose sight of the next time Warren Buffett talks about how perplexed he is by Gold. Perhaps Warren should have listened to his father, Howard (a congressman), a little more:
Now, I am not interested in politics, as I fully expect politicians to play their role and do the exact opposite of the right thing regardless of which party or platform they claim to represent. I also don't believe that a Gold standard can fix the world's problems, as governments controlling money is the problem, not the form of monetary system governments foist upon the masses. In most countries in the world currently, one is free to save in Gold rather than paper currency, which is the important thing for pragmatists like myself. But if one uses history as a guide, I think Howard Buffett was closer to the mark than his son Warren. In any case, Gold will win over Warren and his paperbug minions this cycle because it is simply the time for this to occur. Cycles in markets exist much like cycles in nature, as financial markets are but a manifestation of the thoughts and emotions of one of nature's more curious species. We are in a secular fear and uncertainty cycle for conventional financial assets, which benefits Gold. Moving from the philosophical to the tactical, now is the time to be bullish on Gold and its derivatives, not bearish. The intermediate term correction from the fall 2012 highs in the PM sector was much longer and deeper than I thought it would be, but we are where we are now. And keeping a healthy perspective on the intermediate term, the current set up is much more likely to lead to a bullish outcome than a bearish one. Here's a 12 year weekly chart of Gold thru Friday's close to show you what I mean:  And the beleaguered Gold stock sector is also oversold and significantly undervalued for the 3rd time in the past year. An interesting phenomenon occurred to end last week, however, in the small cap Gold mining sector. Using the GLDX ETF as a proxy for the explorer/small cap Gold mining sector, here is the weekly price action over the past few years thru Friday's close:  I remain wildly bullish on the whole PM sector. If you would like some assistance navigating the PM sector with an orientation towards trading the intermediate-term swings, I publish a low cost subscription trading service that is only $15/month. Otherwise, keep the faith and hold onto your PM sector items tight. Don't let the short and intermediate-term noise distract you from what still promises to be a secular bull market for the history books. The Dow to Gold ratio will hit 2 (and we may well go below 1 this cycle).  |
| Massive US Mint Gold & Silver Bullion Sales Are A Bullish Omen Posted: 05 Jan 2013 10:15 AM PST Submitted by Adam Hamilton: The US Mint's bullion coins are called American Eagles. The "bullion" distinction means their value is based solely on the spot prices of gold and silver, with no special premium for rarity. So they offer investors far more physical metal per dollar spent than expensive collectible coins. I've always believed maximizing [...] |
| Posted: 05 Jan 2013 06:36 AM PST Gold and silver come in multiple forms, each with their own unique yet interrelated supply-and-demand profiles. Among the most popular in the US physical market are the bullion coins produced by the US Mint. Investor demand for these beautiful coins has been robust in recent months despite all the unrelated fund selling weighing on gold. US Mint bullion-coin sales offer great insights into physical demand. The US Mint's bullion coins are called American Eagles. The "bullion" distinction means their value is based solely on the spot prices of gold and silver, with no special premium for rarity. So they offer investors far more physical metal per dollar spent than expensive collectible coins. I've always believed maximizing one's total gold and silver holdings is far more prudent than playing the scarcity game. The American Eagles were born in the Gold Bullion Coin Act of 1985, which Ronald Reagan signed into law. Back in the early 1980s, foreign bullion coins like the famous South African Krugerrand were soaring in popularity. The US Congress wanted the US to compete in this prestigious national market, so it directed the US Mint to start producing gold coins exclusively with gold mined in the US within the past year. This program has proved wildly successful, although not without controversy. My last essay in this series discussed an episode where the US Mint couldn't meet soaring demand and was forced to temporarily suspend sales. Conspiracy theorists went apoplectic, enraged because the Gold Bullion Coin Act legally obligated the US Mint to "mint and issue the gold coins … in quantities sufficient to meet public demand". But overall, the American Eagles have been a huge success. They are a fantastic way to get into physical gold and silver investing. They are beautiful, portable, and easy to buy and sell since they are instantly recognized globally. They are also easy to hide at home, where no bank shutdown can threaten access to them and no government can confiscate them. I started amassing my own hoard in 1998. Besides promoting the obvious virtues of owning physical gold and silver held in your own immediate physical control, American Eagles offer unique insights into physical bullion supply-and-demand trends. The US Mint has been very transparent about publishing detailed sales data, which is very interesting to take a look at from time to time. It reflects grassroots physical precious-metals sentiment like nothing else can. There are some caveats though. First, the US Mint bullion-coin sales are only of new coins. But Eagles are never destroyed. So there is a large supply out there of past years' coins trading hands that dwarfs the annual new supply. If you go into a typical coin shop, they will almost always try to sell you past years' coins they have bought back from other investors. So new-sales data is only the tip of the coin iceberg. Second, there are plenty of other forms of physical gold and silver for individual investors to buy. These include foreign national coins, bars, privately-minted coins, rare coins, old currency, etc. And some of these other forms offer considerably lower premiums over spot prices than Eagles, particularly on the silver side. So realize the US Mint's sales data is merely a small sample of the total physical market. Still, the US Mint's production is based on real-world demand from coin dealers. When these guys have enough inventory from existing investors selling, they don't need to order new Eagles from the Mint. So the Mint ramping up production is always a response to rising coin-dealer demand, which is in turn the result of rising investor demand for physical gold and silver. Thus the Mint's sales data is valuable. It is made available on a monthly basis for both gold and silver Eagles. The charts in this essay superimpose these coin sales over the daily gold and silver price action over the course of their entire secular bulls. Despite the perception of 2012 being a weak year for the precious metals, new physical demand from investors for American Eagles is actually robust to strong. This is certainly a bullish omen. The red line here is the gold price, the blue line is the monthly US Mint gold Eagle sales in ounces, and the yellow lines are the annual averages of these monthly sales. Back in the early years of gold's secular bull, this metal remained a hardcore contrarian play. Not many investors would touch it, so I'm proud that we started recommending 1-ounce gold bullion coins to our newsletter subscribers at $264 in May 2001. Average monthly volumes of new gold Eagle production ranged between about 22k to 45k ozs from 2001 to 2006. The supply was much lower than recent years because widespread investor demand simply hadn't materialized yet. After an odd lull in late 2006 and 2007, the stock panic proved to be the catalyst that awakened investors. That once-in-a-lifetime fear superstorm, despite hitting gold too, sparked big physical demand. 2008's average monthly sales of 72k ozs of gold Eagles dwarfed anything that came before it, and 2009's staggering 120k was far better still. 2009 was a great year for gold, it surged 24%. It also happened to be the first year of the Obama Administration, which frightened many conservative investors who believe in limited Constitutional federal government. Whatever the reasons, gold Eagle demand was massive. But ever since then it has tapered off. 2010's average monthly sales of new Eagles were 101k ozs, 2011's 83k ozs, and 2012's slumped to 63k ozs. Though new investment demand in terms of gold ounces has been cut in half since 2009, it still remains double average pre-panic levels of 30k ozs. And of course gold is worth far more now than it was back in 2009, so this ounces comparison is understated. Back at the 2009 peak year for sales of freshly-minted gold Eagles, the average gold price was $974. Multiply this by the 119.5k average of monthly sales, and the actual capital volume ran around $116m per month (or $1.4b per year). Meanwhile in 2012 the average gold price was $1669, 71% higher. So the average capital volume last year was $104m per month ($1.3b per year). Real demand remains healthy. Instead of being cut in half as the ounces sold indicates, in terms of money investors are plowing into physical gold Eagles demand in 2012 was only down around 10% from its peak in 2009! So gold investment demand remains robust despite this metal's high consolidation in 2012 and odd fund selling last month. And remember that the supply of Eagles is cumulative, all older ones remain in existence. So either the great majority of earlier investors aren't selling their gold Eagles back to dealers, or there is so much new demand from existing and new investors that dealers can't get enough inventory from buying back earlier years' coins. Dealers are seeing big investor demand they can't meet through trading, so they continue to consistently order large quantities of new American Eagles directly from their source. Interestingly monthly sales indicate physical demand has improved dramatically since early 2012, from 21k ozs in February to 137k in November. November 2012 happened to be the strongest November for new gold Eagle sales in 14 years, since 1998! And back then the gold price only averaged $294, a far cry from the $1722 in November 2012. So this latest November's gold demand in dollars was just staggering. Why? Obama winning reelection. After talking with countless gold investors over the last dozen years, I have a pretty good understanding of our demographic. We tend to be hardworking conservatives, living within our means so we can save surplus income to invest. We believe government must live within its means just like we do. And we love freedom and generally distrust government and its paper money. So half of the Americans who bothered voting rewarding Obama for his disastrous first term was dumbfounding. He ran the biggest deficits in US history, driving the biggest debt growth in US history. His spending and deficits as a percentage of GDP were staggering, truly Greece-like. He presided over the worst employment record since the Great Depression, and poverty surged to record levels under him. So Obama's win really scared the conservative backbone of American investors. After all the vast damage done by this man's horrendous philosophies and policies in his first four years, what would America look like after four more years? And Obama was stepping up his Marxist class-warfare rhetoric, attacking successful Americans who worked hard and made wise decisions. So investors flocked to physical gold. I fully expect this trend to continue. The only reason Obama can run his mind-boggling record deficits is because the US Federal Reserve is directly monetizing half of them going forward. Its December expansion of QE3 is wildly bullish for gold and silver in 2013. We've never seen such a gigantic surge of pure inflation, so it should absolutely ignite huge investment demand for all forms of gold and silver. If all this is true, you may be wondering why the US Mint's new gold Eagle sales plunged from 137k ozs in November to just 76k in December. Odds are this has nothing to do with investor demand. In early December, the US Mint winds down current-year coin production so it can start up the following year's which are released in January. The new year's date stamp is highly prized, often driving large demand spikes. So this month's sales data ought to prove very interesting once released. Will the US Mint have the production bandwidth "to meet public demand" for 2013 gold Eagles? We have QE3X's new Treasury monetizations spinning up, a terrible fiscal-cliff deal with no spending cuts, more brazen attacks on our Constitutional freedoms coming from the Obama Administration, and festering market uncertainty. Gold bullion-coin demand is already robust in capital-volume terms, and has been rising dramatically in ounces terms since Obama's odds of winning the 2012 election started growing. Investors want to own physical gold held in their own immediate physical custody, which is the ultimate insurance policy for every conceivable market, political, or personal hardship or calamity. This trend should only accelerate. And boy, if gold Eagle demand is looking robust then silver Eagle demand is astounding! Silver Eagles occupy a strange niche. Though they are universally loved and highly-prized for their beauty, they are far from the cheapest way to buy silver bullion. That prize falls to junk coins (old everyday-use currency like quarters that had some silver content), generic "rounds" (privately-minted silver coins), and bulk bars. So most experienced silver investors don't bother with silver Eagles unless they are going to be used for gifts. This implies that the massive silver Eagle demand in recent years is from newer investors. They are also probably smaller too, implying silver investing is starting to catch on with the masses. The fact that silver bullion-coin demand is dwarfing gold bullion-coin demand also supports this smaller thesis. Like the gold Eagles, silver Eagles' demand was remarkably consistent early in this secular bull before 2008's epic stock panic. That year silver Eagle demand doubled, and it has continued rising every year since until last year. But with average monthly demand of 2.8m ozs of silver Eagles in 2012, that was still the third-best year of this bull and very high in absolute terms. Much of this was from a colossal January spike. When investors want silver Eagles, they often prefer the current year's date for their coins to commemorate their investment. So in January 2012, coin dealers purchased an astounding 6.1m ozs of silver Eagles! Given the still-strong demand for the rest of last year, generally well above panic levels, odds are January 2013 will prove similar. So we may really see some blowout silver demand with everything going on. And once again, last year's silver bullion-coin demand is far more impressive when considered in capital-volume terms. Back in 2010 when monthly demand averaged 2.9m ozs of silver Eagles, the silver price averaged just $20.24. This implies monthly capital volume of $58m, or $699m per year. But in 2012 when a similar monthly average of 2.8m ozs of new silver Eagles were sold, silver averaged $31.19. This works out to a much larger average monthly dollar value of $88m in silver Eagles being purchased, or $1.1b per year. So investor demand for physical silver as represented by new silver Eagle sales remains incredibly strong. I imagine it will skyrocket again once silver's young upleg regains steam soon. Silver demand in 2011 was incredible after its last massive upleg ignited by the Fed's QE2 peaked. So despite the headline weakness in gold and silver in recent months, grassroots physical investment demand remains robust to strong. Buying gold and silver bullion coins takes a high level of commitment and motivation. Investors have to find a coin dealer, go there or order the coins, and take delivery. This is far more time-consuming than spending a few seconds adding the GLD or SLV ETFs to one's portfolio. And investors buy physical coins for great reasons, usually as the ultimate insurance policy for the unexpected. Physical coins can't be frozen like a bank account, can't be stolen or confiscated if hidden well enough (and kept secret), and are the ultimate portable and liquid form of storing wealth. For a dozen years now, I've zealously recommended every investor have a physical-coin portfolio foundation. These should be hidden on your own property, not stored with some third party. The only gold coins confiscated in the infamous 1933 seizure by Democratic President Franklin Roosevelt were ones stored in bank safe-deposit boxes. The government never bothered going door-to-door, a politically-risky, dangerous, and expensive strategy. It's sad, as earlier in this bull I thought a new gold confiscation was all but impossible. But the Obama Administration is now making lots of noise about going after our guns, taking away our Constitutional right to defend our families from criminals and the government with effective firearms. Obama already stole our right to choose whether or not we want medical insurance, a private product. So under this power-drunk profligate autocrat, I'm no longer so certain that private gold won't be targeted again someday. So if you've never bought gold and silver bullion coins, now is a great time to get started and stockpiling. It's easy, just find a reputable local coin dealer who has been in business a long time and stop by to chat with him. He'll help you understand what coins are available, what kinds of premiums over spot they command, and how to make your purchase. Then take your coins home, hide them, and forget about them. At Zeal we've long since laid in physical bullion-coin foundations for our portfolios, so we are looking for higher returns for new capital. Thus we remain really excited about the beaten-down gold and silver stocks today, which are incredibly undervalued relative to prevailing gold and silver prices. As the precious metals continue higher in their young uplegs, the stocks of their miners are overdue to soar dramatically. We recently finished a new deep-research project digging into the universe of silver juniors trading in the US and Canada. We spent several months researching nearly 100, gradually whittling them down to our dozen fundamental favorites. Each is profiled in depth in a fascinating new 23-page report. One was already bought out at an epic 72% premium! Buy your silver-juniors report today and get deployed soon! We also publish acclaimed weekly and monthly subscription newsletters loved by speculators and investors worldwide. In them I apply our vast experience, knowledge, wisdom, and ongoing research to explain what is going on in the markets, why, and how to trade it with specific high-potential stocks as opportunities arise. We are now recommending plenty of amazing gold and silver stocks that remain cheap. Subscribe today! The bottom line is grassroots physical gold and silver investment demand remains robust to strong. This is despite the recent months' atypical weakness in the precious metals. The US Mint continues to sell lots of gold and silver Eagles to coin dealers, who would only be ordering them if they had demand from investors. Actual coin volumes look fine, but the capital being poured in at today's prices is quite impressive. And as the recent surge in gold Eagle demand indicates, the political environment can be a big driver of investment demand. We are now stuck with four more years of out-of-control federal spending and the resulting ruinous deficits. The Fed is aggressively monetizing this new debt, which is highly inflationary. As gold and silver start powering higher again, investment demand is only going to continue growing. |
| GoldCore: Gold in Manipulative Selloff? Nice New Year's Gift Posted: 05 Jan 2013 05:51 AM PST ¤ Yesterday in Gold and SilverThe engineered price decline in gold came to a halt less than half an hour before the noon London silver fix during their Friday morning...and the subsequent rally came to an end at the London p.m. gold fix...which was 10:00 a.m. Eastern time. From there, the gold price got sold down a bit until about 11:35 a.m. in New York before resuming the rally...albeit at a much slower rate. Shortly after 3:00 p.m. the gold price jumped up a few more bucks, before trading sideways into the 5:15 p.m. electronic close. Gold's low price tick of the day in London was around $1,625 spot...and the high tick of the day [$1,659.80 spot] came late in electronic trading in New York. Gold finished the Friday session at $1,646.80 spot...down $7.00 from Thursday's close. Net volume was immense...around 230,000 contracts. Of course it's always silver that JPMorgan et al are after...and they nailed it pretty good for the second day in a row. The actual low price tick [around 29.20 spot] came around 10:30 a.m. in London...the time of the a.m. gold fix. From there the silver price pattern pretty much followed the gold price pattern into the close of trading. And, like gold, silver's high print of the day [$30.38 spot] occurred in electronic trading just before the market closed. Silver actually finished in the green at $30.18 spot...up 8 cents from Thursday's close. Volume was very heavy at around 72,000 contracts. The dollar index opened at 80.50 on Thursday evening...and by 11:30 a.m. in London on their Friday morning, it had reached its high of the day, which was around 80.85. It hung in there at that value until just before 8:30 a.m. Eastern time...and then gave up all of those gains during the New York trading session that followed. The index closed almost where it started the day...at 80.49...down an eyelash from Thursday. Not surprisingly, the gold stocks gapped down at the open...and spent most of the trading day down at least a percent. But the sharp rally in gold [and silver] shortly after 3:00 p.m. Eastern caused an equally impressive pop in the gold shares as well...and the HUI actually finished in positive territory...up 0.14%. Not a lot, to be sure, but better than the alternative. With the odd exception, all the silver stocks finished in the green yesterday...but Nick Laird's Intraday Silver Sentiment Index only closed up the same amount as the HUI...0.14%...which I thought was rather strange. (Click on image to enlarge) The CME's Daily Delivery Report showed that 129 gold and zero silver contracts were posted for delivery on Tuesday from within the Comex-approved depositories. Merrill was the only short/issuer...and the lion's share [116 contracts] were stopped by the Bank of Nova Scotia and JPMorgan Chase. The link to yesterday's Issuers and Stoppers Report is here. After the big withdrawal on Thursday, the GLD ETF showed that an authorized participant added 58,100 troy ounces of gold yesterday. Over at SLV, an authorized participant withdrew 628,824 ounces of silver. The U.S. Mint had a sales report for the third day running. They sold 8,500 ounces of gold eagles...and another 1,500 one-ounce 24K gold buffaloes. For the first three days of the year, the mint has sold 65,000 ounce of gold eagles, along with 14,500 one-ounce 24K gold buffaloes. In January of 2012 the mint sold 127,000 ounce of gold eagles...and 13,500 one-ounce 24K gold buffaloes. Based on mint sales to date, the January 2012 sales number should be beaten by quite a bit...and they already have in buffaloes. But it's still my opinion that most of these sales happened in December, but were shoved into January. And if I were an American citizen, I'd be buying 2013 silver eagles with both hands the moment they became available. There was big activity over at the Comex-approved depositories on Thursday. They reported receiving 2,163,705 troy ounces of silver...and shipped 600,440 ounce of the stuff out the door. The link to all that activity is here. The new Commitment of Trader Report came out yesterday at the usual time...and there were no surprises...and no big news. All the 'juice' will be in the next COT Report...as the engineered price decline began on Wednesday, the day after the cut-off for yesterday's report. As any long-term reader of this daily rant already knows, this is standard operating procedure for JPMorgan et al if they wish to hide their tracks for as long as possible. In silver, the Commercial net short position declined by 1,372 contracts, or about 6.9 million ounces. Ted Butler says that it was pretty much all raptor buying during the reporting week...and that the 'Big 4' didn't change their positions by much. The Commercial net short position is now down to 226.7 million ounces. The 'Big 4' bullion banks are short 239.8 million ounces of silver...which is 13.1 million ounces more than the entire Commercial net short position shown in the paragraph above. On a 'net' basis, these four traders are short 49.0% of the entire Comex futures market in silver...but the truth of the matter is that it's only two traders in the 'Big 4' bullion bank category that really matter...and they are JPMorgan Chase and the Bank of Nova Scotia. It's my guess that they are short about 45% of the entire Comex silver market all by themselves. The '5 through 8' largest traders are short an additional 55.2 million ounces of silver...and on a 'net' basis are short an additional 11.3 percentage points of the entire Comex futures market in silver. Adding up the numbers, the 'Big 8' bullion banks are short a bit over 60% of the entire Comex silver market. In gold, the Commercial net short position actually increased by 995 contracts, or 99,500 troy ounces...and now sits at 18.86 million ounces. The 'Big 4' bullion banks are short 11.81 million ounces of gold, which represents 33.3% of the entire Comex futures market on a 'net' basis. The '5 through 8' bullion banks are short an additional 5.01 million ounces. This represents 14.1% of the entire Comex gold market on a 'net' basis. The total for the 'Big 8' comes to 16.82 million ounces of gold...and 47.4% of the entire Comex gold market. Here's Nick's most excellent "Days of World Production to Cover Short Positions" chart that shows 'all of the above' in graphic form...and the links to the historic [and interactive] COT Reports are here for silver...and here for gold. They take a while to load if you have an older browser. (Click on image to enlarge) Of course, this is all 'yesterday's news' as Ted Butler is wont to say...as the price action since the Tuesday Comex close has mostly relegated this last COT Report to the trash bin. I would love to have seen what a new COT report would have looked like if the cut-off was at the Comex close yesterday. I'm sure that with the big new low in silver...and the new low in gold...there were huge declines in the Commercial net short position in both metals, as the tech funds puked up their longs...and the Commercial traders covered short positions...and/or went long themselves. I'll have more on this in 'The Wrap' section further down. Since it's the weekend, I have more than the usual number of stories for your reading 'pleasure' today...and I hope you can find the time over what's left of your weekend to read the ones that interest you. I'd just love to see what the COT structure looked like after Friday's trading day was done. Turkish gold exports rise 800 percent on demand from Iran. Jim Sinclair: Campaign to discredit gold indicates worst desperation yet. Gartman: The Gold Bug Thesis is Officially in Tatters. A $1 Trillion platinum coin??? ¤ Critical ReadsSubscribeJPMorgan to BofA Get Delay on Rule Isolating DerivativesJPMorgan Chase & Co., Goldman Sachs Group Inc. and Bank of America Corp. won a delay of Dodd-Frank Act requirements that they wall off some derivatives trades from bank units backed by federal deposit insurance. Commercial banks including the Wall Street firms may get as long as an additional two years -- until July 2015 -- to comply with the rules, the Office of the Comptroller of the Currency said in a notice yesterday. The so-called push-out provision was included in the 2010 financial-regulation law as a way to limit taxpayer support for risky derivatives trades. The Commodity Futures Trading Commission and other regulators need to complete swap rules to allow "federal depository institutions to make well-informed determinations concerning business restructurings that may be necessary," the OCC said in the notice. Dodd-Frank requires that equity, some commodity and non-cleared credit derivatives be moved into separate affiliates without federal assistance. Regulators including Federal Reserve Chairman Ben S. Bernanke had opposed the provision, saying it would drive derivatives to less-regulated entities. In February, the House Financial Services Committee approved with bipartisan support legislation that would let banks keep commodity and equity derivatives in insured units by removing part of the rule. Well, dear reader, it's a good bet that if all of those listed above were opposed to it, it was probably in the best interests of the investing public. This story showed up on the Bloomberg website early yesterday afternoon...and I thank Manitoba reader Ulrike Marx for our first story of the day. The link is here.  Liesman: "The Fed Gets to Print Dollars"; Bullard: "Indeed We Do"Fed mouthpieces Bullard and Lacker are out in force [yesterday] morning talking the market back from the edge of yesterday's FOMC Minutes and reassuring us that the economy is going to be weak enough for a lot longer to justify the Fed's actions. However, right at the end of Jim Bullard's interview with CNBC's Steve Liesman, we got a glimpse of the reality behind the curtain as the St. Louis Fed president threw Bernanke under the Following a discussion of fiscal policy uncertainty and the need to carefully spend what money we have, Liesman jokingly commented to Bullard that it is "Easy for you to say, you have a lot of dollars to spend; you get to print them!" To which the now foot-in-mouth Bullard replied, "Aaahh; indeed we do." This short piece, along with an embedded CNBC video clip, was posted on the Zero Hedge website yesterday...and I thank Matthew Nel for bringing it to our attention. The link is here.  Gore Went to Bat for Al Jazeera...and HimselfAl Gore's Current TV was never popular with viewers, but it was a hit where it counted: with cable and satellite providers. When he co-founded the channel in 2005, Mr. Gore managed to get the channel piped into tens of millions of households — a huge number for an untested network — through a combination of personal lobbying and arm-twisting of industry giants. He called on those skills again after deciding in December to sell Current TV to Al Jazeera for $500 million. To preserve the deal — and the estimated $100 million he would personally receive — he went to some of those same distributors, who were looking for an excuse to drop the low-rated channel, and reminded them that their contracts with Current TV called it a news channel. Were the distributors going to say that an American version of Al Jazeera didn't qualify, possibly invoking ugly stereotypes of the Middle Eastern news giant? "The lawyers for the carriers couldn't find their way around it," said a person briefed on the negotiations who described them on condition of anonymity...and on Wednesday night, a deal was announced that will bring the Al Jazeera brand into at least 40 million homes in the United States. It will also make Mr. Gore, who is already estimated to be worth more than $100 million, an even richer man. Gordon Gecko was probably right..."Greed is Good"...at least for the rich and well connected. This story was posted on The New York Times on Thursday...and it's Roy Stephens first offering of many in today's column. The link is here.  White House wins fight to keep drone killings of Americans secretA federal judge issued a 75-page ruling on Wednesday that declares that the US Justice Department does not have a legal obligation to explain the rationale behind killing Americans with targeted drone strikes. Siding with the defendants in what can easily be considered as cloaked in skepticism, Judge McMahon writes that the Obama White House has been correct in refusing the FOIA requests filed by the plaintiffs. "There are indeed legitimate reasons, historical and legal, to question the legality of killings unilaterally authorized by the Executive that take place otherwise than on a 'hot' field of battle," McMahon writes in her ruling. Because her decision must only weigh whether or not the Obama administration has been right in rejecting the FOIA requests, though, her ruling cannot take into consideration what sort of questions — be it historical, legal, ethical or moral — are raised by the ongoing practice of using remote-controlled drones to kill insurgents and, in these instances, US citizens. "The Alice-in-Wonderland nature of this pronouncement is not lost on me; but after careful consideration, I find myself stuck in a paradoxical situation in which I cannot solve a problem because of contradictory constraints and rules — a veritable Catch-22," she writes. "I can find no way around the thicket of laws and precedents that effectively allow the Executive Branch of our Government to proclaim as perfectly lawful certain actions that seem on their face incompatible with our Constitution and laws, while keeping the reason for their conclusion a secret." This article showed up on the Russia Today website early Thursday morning Moscow time...and is an absolute must read. I thank Roy Stephens for sending it...and the link is here.  Americans...never give up your gunsThese days, there are few things to admire about the socialist, bankrupt and culturally degenerating USA, but at least so far, one thing remains: the right to bear arms and use deadly force to defend one's self and possessions. This will probably come as a total shock to most of my Western readers, but at one point, Russia was one of the most heavily armed societies on earth. This was, of course, when we were free under the Tsar. Weapons, from swords and spears to pistols, rifles and shotguns were everywhere, common items. People carried them concealed, they carried them holstered. Fighting knives were a prominent part of many traditional attires and those little tubes criss-crossing on the costumes of Cossacks and various Caucasian peoples? Well those are bullet holders for rifles. Various armies, such as the Poles, during the Смута (Times of Troubles), or Napoleon, or the Germans even as the Tsarist state collapsed under the weight of WW1 and Wall Street monies, found that holding Russian lands was much, much harder than taking them and taking was no easy walk in the park but a blood bath all its own. In holding, one faced an extremely well armed and aggressive population Hell bent on exterminating or driving out the aggressor. This well armed population was what allowed the various White factions to rise up, no matter how disorganized politically and militarily they were in 1918 and wage a savage civil war against the Reds. It should be noted that many of these armies were armed peasants, villagers, farmers and merchants, protecting their own. If it had not been for Washington's clandestine support of and for the Reds, history would have gone quite differently. [Emphasis mine. - Ed] This is a must read for all Americans in general...and all students of the "New Great Game". Washington's support for the Communists during the revolution is covered in G. Edward Griffin's classic tome..."The Creature From Jekyll Island". It was posted on the pravda.ru Internet site on December 28th...and I thank reader U.D. for bringing it to our attention. The link is here. |
| Posted: 05 Jan 2013 05:11 AM PST SD reader Cleburne writes: Hey Doc, I just wanted to share a few thoughts with you, to see if you've felt the same things I've been feeling. I guess it's brought about by the dual Federal Judge dropping the JPM lawsuit (expected, but not one bit less tragic and disappointing despite, is this what Chilton [...] |
| Posted: 05 Jan 2013 04:54 AM PST |
| Posted: 05 Jan 2013 12:16 AM PST Zealllc |
| Confiscation of Gold – Then What? Part 4 Posted: 05 Jan 2013 12:06 AM PST Gold Forecaster |
What if the shockingly low valuations of some junior mining companies are really all they're worth? As the market shakes off years of exuberance, Brent Cook, co-editor of the Exploration Insights newsletter, searches for the truly undervalued—finds as rare as gold itself. In this interview with 
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