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arco
27-06-2007, 01:40 PM
Hi All

Gold broke the uptrend line last night.
Based on the chart below it appears to have the
potential to head towards the blue box area where
there is a harmonic target and PRZ.


http://img.photobucket.com/albums/v54/arcoshares/062707BF.gif

regards - arco

arco
12-09-2007, 02:35 PM
The old 'Gold Main thread' seems to have dissapered off the ASX side, so I will post any thoughts and charts here now.

IMO there is the possiility of a reversal in the near term, with a sell off to 690-700 area before Gold can resume north bound flight.

Watching for a reversal pattern on the daily.

arco

peat
12-09-2007, 06:02 PM
yeh looking overbought on the CMO and is positioned at the 261 extension tho not giving a turn signal yet.

and if it retraces to the 161 then thats 685.42

arco
02-10-2007, 12:26 PM
Gold Gains, Extending Rally to 27-Year High, Amid Strike Threat

By Claudia Carpenter

Oct. 1 (Bloomberg) -- Gold gained in London, extending a rally to a 27-year high, on speculation a strike in Peru will disrupt supplies at a time of increased demand. Silver fell.

At least 38 mining unions decided to begin a national strike on Nov. 5, Mining Federation spokesman Cirilo Yarihuaman said Sept. 28. Newmont Mining Corp.'s Yanacocha mine in Peru was the biggest gold mine last year, according to London-based researcher GFMS Ltd. Gold has climbed 17 percent this year as investors sought an alternative to a declining dollar.

``The possibility of a strike in Peru is bullish news because Peru is a significant miner,'' said David Thurtell, an analyst at BNP Paribas SA in London. ``Mine production has been struggling for some years.''

Gold for immediate delivery gained 92 cents to $744.52 an ounce at 12:33 p.m. in London after earlier rising to $746.79, the highest since Jan. 21, 1980. Silver dropped 3.5 cents to $13.73 an ounce.

Gold has climbed for six consecutive weeks as the dollar dropped to a record against the euro. The dollar traded at $1.4211 at 12:49 p.m. in London after earlier falling to a record low of $1.4282.

To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net
Last Updated: October 1, 2007 07:54 EDT

peat
04-10-2007, 10:02 AM
From ABN Amro

Economic comment
Golden legacy
Tim Drayson
Robert and a few clients had a private dinner with Alan Greenspan shortly after he retired as Fed Chairman last year. To avoid a scene I was kept well away, but I was allowed to put
forward one question (through Robert) and I asked for his thoughts on gold. He responded
with words to the effect that it only takes a few fanatics to believe in financial Armageddon to drive the price higher. No surprise then that he didn't admit he has helped create the environment for a multi-year bull market. This week has seen gold hit a 28-year high. I first publicly expressed my optimism on gold in the Overnight Report, 'Goldfinger' 25 May 2005, when gold traded at $419 per ounce. I remain bullish even at current levels.
You don't have to believe in an impending financial crisis and the end of fiat money to expect the gold price to rise further (though it helps - Ed). Up to mid-2005, the gold price had tracked fluctuations in the dollar. Then there was a period of decoupling, but the main driver of gold price strength in future is likely to remain dollar weakness. The unwinding of the US current-account deficit has only just begun and a further significant drop in the dollar is required to smooth the adjustment. In addition, US policymakers seem comfortable to use the dollar as a tool to reflate the economy. Gold has reacted positively to the surprise 50bp Fed cut. Some commentators viewed this as the Fed losing their inflation-fighting credibility.
I think there is a danger of this in the future, but it hasn't happened yet. Long-term bond
yields have now reversed their move higher after the Sept 18 FOMC. There is still virtually
no inflation risk premium priced into bonds. When inflation worries return, this could give an
additional lift to gold.
Over the last decade gold has moved higher in tandem with other industrial metals and has
received support from increased investment flows into commodity funds. This makes it
potentially vulnerable to a correction. But there are signs that a decoupling for base metals
might be under-way. In contrast to industrial metals, which our commodities analyst Nick
Moore expects to experience increasing supply growth, gold supply contracted last year and
appears to be falling again in 2007. South Africa has been worst affected: gold mine supply
has slumped 36% since 2000 to its lowest level in 85 years according to the South African
Chamber of Mines. For years, central banks have depressed gold prices (I don't believe this
is a conspiracy), but this could now be changing. Central bank sales appear to running
below those of the central bank gold agreement and there is the possibility that the Asians,
particularly China, might seek to diversify some of their vast foreign exchange reserves into
gold.
Gold should do well under our central forecast for decent global growth and an orderly
decline of the dollar. But there is potential for spectacular gains if the Fed decides to react
more aggressively to falling house prices. This would be compounded if other central banks
resist the dollar's decline. This could lead to a general loss of confidence in central banks
and a desire to reduce holdings of paper currencies. Given the limited supply, gold could
develop into the next speculative mania. (Analyst disclosure: I own physical gold and gold
and silver stocks

Baa_Baa
13-10-2007, 07:29 PM
While USPOG bounds through long term resistance and bolts to $750, then wobbles sideways for a week or two, in the face of a bounced USD off new loooong term lows, some would call this 'consolidation'. I'd pick safety in USPOG unless it drops back through the breakout (now support) around $720. It's not out of the question for USD to climb right back to old support (now resistance), in which case, USPOG would probably heavily 'correct'. Anyway, that remains to be seen.

But what's the point of analysing USPOG if we buy the precious metals using our hard earned NZD's? Not much point really, except it's interesting and we stay in touch with the big picture. As far as picking the buy points for physical metal accumulation (or sells if you can stand unloading precious), the trick might be to use charts of Gold in NZD. That way you know for sure whether the price in local currency is actually tracking with or against the USPOG.

Fact is, with the NZD being on the end of the USD whipping hose, the NZPOG tends to have a life of it's own. Attached should be a snapshot of Gold in NZD. You'll see it has a similar look to USPOG, but it sure isn't exactly the same.

I hope this might help some of those people who tend to pay way over the odds on places like TradeMe, for miniscule amounts of physical metal and coin, when in fact they could simply call NZMint or AGRNZ and purchase bars of varying sizes at Spot in NZD, plus a modest fabrication and shipping; usually in my experience a much better proposition.

All the best
BAA

arco
17-10-2007, 01:44 PM
I read on another forum that in China, banks have put up banners in faraway small towns encouraging people to buy paper gold.

The Chinese are seemingly aware of their inflation.....unlike US which is no doubt masked by flawed statistics............................ Hence the rush to Gold is inevitable.

Therefore the current Gold level would still appear to provide good opportunities - buying on dips.

Craig3215
17-10-2007, 03:37 PM
The smartest man I've ever met, Martin Armstrong, told me recently that gold is going to 1500 by 2010. He's made a number of calls in the past, most recently I made a nice amount of cash on his feb 27 call. He also said that the dollar will continue to go down and the us markets will go up in unison with the decline in the dollar.

arco
17-10-2007, 04:03 PM
Craig

Is he out of prison now..........or was that a different Martin Armstrong?

rgds - arco

Craig3215
17-10-2007, 05:12 PM
Hi Arco,

He is unfortunately still in prison but is no longer being held indefinitely in contempt of court, so he at least knows when he's getting out now (4 1/2 more years on his 5 year sentence even though in total he's been in jail for 8 years). Anyway the whole thing is ridiculous, I'm very close with him and his family, and I visit him a couple of times a month so I still get some of his valuable insight on the markets.

trader10
09-12-2007, 09:35 PM
I'm wondering what gold will do in the next weeks ahead :)))) I've got physical gold.....and the only stock on hold with gold is AGS....

Russia 'test-fires ballistic missile'

December 9, 2007 - 7:14AM

Russia test-fired an inter-continental missile with new equipment able to pierce anti-missile shields, state news agency RIA said, underscoring Moscow's determination to assert its military might.

The RS-12M Topol ballistic missile, called the SS-25 Sickle by NATO, was successfully launched at 17:43 pm (0143 AEDT) from Kapustin Yar firing range in southern Russia, RIA said, citing a spokesman for rocket forces.

"The launch was carried out with the aim of confirming the stability of the fundamental flying and technical characteristics of this class of missile," Rocket Forces spokesman Alexander Vovk told RIA.

He said the test was part of a trial of unspecified new equipment that could pierce anti-missile shields. Russian generals say the country is working on weapons that would pierce any shield the United States could make.

The launch of the revamped missile comes amid US plans for a missile defence shield in Europe, which Russian President Vladimir Putin has said would threaten Russian interests.

Putin signed a law last week suspending Russia's participation in the Conventional Forces in Europe (CFE) Treaty in a step which could allow it to deploy more forces close to western Europe. The move comes into force on December 12-13.

As configured in 1985, the Topol has a maximum range of 10,000 km, and can carry one 550-kiloton nuclear warhead. The 20.5 metre long missile was designed in the 1970s and made its first flights in 1982.

The last launch of a Topol missile took place on October 18.

Buoyed by huge oil revenues, Russia under Putin has been boosting military spending while at the same time using diplomacy to broaden Moscow's influence.

This week, Russia said it would start the first major navy sortie into the Mediterranean since Soviet times. Eleven ships, including an aircraft carrier, will take part in the sortie and be backed up by 47 aircraft-including strategic bombers.

© 2007 Reuters

Craig3215
27-12-2007, 05:39 AM
looks like gold is breaking out of its symmetrical triangle on the daily chart should get up to around 875

ananda77
30-12-2007, 07:50 PM
...with the ongoing enormous increase in the amount of paper money in mind (and a pick up in inflation in just a few months time -A SURE BET-), a study by Peter Millar in 2006:

""The Relevance and Importance of Gold in the World Monetary System"

concluded that a 'Seven-fold increase in gold [is] needed to avert debt depression'

excerpts: "In the second half of the 20th century we saw a repeat of the first three phases of the same cycle:

"-- Phase 1: Stability from 1944 to 1968 under a gold standard.

"-- Phase 2: Inflation from 1968 to 1981, which caused and justified another buildup of debt.

"-- Phase 3: Disinflation from 1981 until the end of the 20th century, and maybe to the present.

"However, it appears that Phase 4 (instability and ultimately deflation due to excessive debt) may have started. If so, Phase 5 (revaluation of the gold price to raise the monetary value of the world monetary base and hence reduce the burden of debt) becomes likely or inevitable. The extent of that revaluation would need to be major according to our calculations, probably by a factor of at least seven times, possibly up to 20 times the current price of gold."

read the full study here: http://www.gata.org/node/4843

...and more "Comparison shows gold underpriced by US$ 400" here:

http://tinyurl.com/23tdgu


Kind Regards

JBmurc
08-01-2008, 08:43 PM
If you have interest in GOLD check out the latest price 872 it has just hit 2nd gear $900 soon might have to take my profits on me GOLD bull warrant soon 100% profits sounds good

brookvill
09-01-2008, 04:39 PM
Gold now trading at above A$1000 certainly great news for unhedged, or lightly hedged producers. this price action has the hallmarks of a very early speculative move in gold.
With the US heading into a recession gold will certainly be on the move up for some time. Interesting times ahead for us gold bugs
.

peat
25-01-2008, 10:03 AM
a big night for the metals both of them broaching the highs from earlier this month

peat
27-02-2008, 06:24 PM
Gold Fields, the fourth-largest gold producer in the world, has said it expects production at its South African facilities to drop between 15 percent and 20 percent as a result of the country’s ongoing electricity crisis. Two other leading South African gold producers are expected to announce production dips as well. While the situation exemplifies the importance of electricity supplies and infrastructure in developing countries, this might also be a move to control gold prices.


AngloGold Ashanti, the world’s third-largest producer, could project a loss of 400,000 ounces of gold at its South African operations, while Harmony Gold Mining Co. could project a loss of almost 26,000 ounces from its South African operations as a result of power outages in the country.
South Africa’s primary domestic energy producer, Eskom, saw its generating capacity reduced by a fifth because of repairs and maintenance ahead of an expected surge in demand during the upcoming South African winter season. Poor planning (including inadequate stockpiling of coal reserves) and a dearth of qualified engineers and technicians have contributed to the crisis, which has included load-shedding throughout the country that has disrupted not only mining operations but also supplies to all consumers, including residences and business offices.
The South African government is attempting to fix the electricity crisis; it has moved to reopen shuttered coal-fired power plants, and it has advertised tenders for the construction of new plants, including nuclear ones. The construction of new power plants likely will take at least a couple of decades, and in the meantime, all sectors of the South African economy — including its critical mining sector — likely will have to make due with an estimated 10 percent less electricity in the short term.
While the South African electricity crisis does threaten output in the country’s mining sector — a critical driver of the country’s economy — the move could be an attempt by gold producers or gold-producing countries to manipulate prices. Barrick Gold Corp., the world’s leading producer, reportedly said Feb. 21 that labor and other supply chain disruptions (such as heavy rains) in late 2007 at its mines in Tanzania reduced production in that country. Newmont Mining Corp., the second-largest gold producer, reportedly said Feb. 19 that output at its Peruvian mines fell 39 percent in 2007, and gold output overall in Peru — which ranks fifth in global production — fell 17 percent in 2007.
South Africa’s economy overall is likely to see its 2008 growth rates lowered because of the electricity crisis. However, reduced output and high demand have helped propel the price of gold to record highs — a circumstance not unfavorable to gold-producing companies and countries.

Craig3215
03-03-2008, 11:36 PM
Went short USD/Zar, expanding triangle on 3 hour and daily chart and currently looks overbought

Craig3215
10-04-2008, 05:16 PM
Long term trend line and two fib levels hopefully acting as resistance... good risk reward in my opinion stop at 942.15

http://i191.photobucket.com/albums/z122/Craigjhu32/gold4-10.jpg

peat
29-04-2008, 09:36 AM
'Urban miners' fleece cellphones for precious metals

http://www.nzherald.co.nz/section/story.cfm?c_id=5&objectid=10506650&pnum=0



Eco-System, established 20 years ago near Tokyo, typically produces about 200-300 kg of gold bars a month with a 99.99 per cent purity, worth about $5.9 million to $8.8 million.
That's about the same output as a small gold mine.

peat
21-05-2008, 03:40 PM
Could be relevant to gold and silver.....



The price of platinum could increase by 50% in 2008, according to a
poll of analysts by the Reuters news agency. Prices are pushed higher
by production problems in South Africa and a rise in demand for
catalytic converters using the metal to filter fumes. The poll sees the
median price of platinum at US$2,000 an ounce in 2008 and US$2,100
in 2009. It was US$1,304 in 2007. Anglo American, which produces
40% of world platinum output, has been hit by power cuts and strikes

peat
24-06-2008, 12:04 AM
Elliot Wave .com are kinda gloomy at times but when theres a free week on their website as there is now its a good time to read it....




So I sold gold to hedge my silver positions tonite....

JBmurc
24-06-2008, 08:43 AM
imho can't see gold fall down through 800 but hey anything can happen the USD has gained well against the EURO still USA #1 export is paper money mid to long term GOLD going alot higher

peat
25-06-2008, 03:10 AM
look at what greenspan wrote in 1967 !

http://www.cyclesman.com/greenspan1967.htm

peat
26-06-2008, 11:35 PM
a little while ago I unhedged
small profit on the gold trade... tho gold can go 930 without breaking ew interpretation...

peat
30-06-2008, 07:33 AM
Released over the weekend.



Gold has rallied nicely toward Inverse Head and Shoulders Neckline Resistance as expected (see Daily Chart below) & with Support now at $910/$905 looking for Gold to now complete this Inverse Head & Shoulders reversal pattern with another rally today, confirming the resumption of Gold’s Uptrend - toward new highs for the year !

arco
14-08-2008, 04:50 PM
Gold Weekly Chart

Perfect AB=CD, with support from Triangle consolidation
Oct-Nov 2007

................so this looks like a fairly good spot to
load up the wagon with low risk IMO

Target 1100-1200



arco

arco
27-08-2008, 12:49 PM
The most useful EMA indicator for trading gold over nearly 32 years was to buy gold when the U.S. dollar crosses below its 7-week EMA and to sell gold when the dollar crosses above its 7-week EMA. This inverse strategy would have gained more than 889% before trading costs and without any leverage. Nearly 52% of the 282 trades would have been profitable, which is pretty good for a trend-following strategy.
Gold moves directly with the trend of the Swiss franc (using a 5-week EMA crossover) and the trend of crude oil (using a 12-week EMA crossover). These make good intuitive sense: Gold should go up when the Swiss franc (a hard currency with gold backing) and crude oil (another inflation-sensitive commodity) are rising.
My testing found an inverse relationship with gold and 10-year T-note yields. This might be spurious, however, because it lacks logic and has been unprofitable since 2003, as 10-year interest rates and gold both rose together. I also doubt the validity of trading gold based on the DJIA or S&P 500. Stocks are not always a good hedge against inflation, and this indicator's Cumulative Equity Curve is too erratic to be reliable.
I conclude that the U.S. dollar (inverse trend), Swiss franc (direct trend), and crude oil (direct trend) are the best and most logical external relationship trend indicators for gold. ...........................


These indicators have been much more profitable than the trend of the gold price itself.
Robert W. Colby is an analyst/strategist for TradingEducation.com and a consultant to institutional and private investors and traders. A serious student of investing for nearly 40 years, Colby is the author of The Encyclopedia of Technical Market Indicators. (TradingEducation.com) (http://www.tradingeducation.com/) (robertwcolby.com) (http://www.robertwcolby.com/)

http://www.marketwatch.com/news/story/divining-golds-next-move/story.aspx?guid={5CABD9A0-0CAC-4439-88F0-1A3E23A9F412}

arco
28-08-2008, 08:36 AM
Gold and Silver: Looking More Precious,

In June, South Africa saw its gold production plummet 12.3% year over year as power cuts interrupted mining. The country has now fallen firmly behind China in global gold production.
Meanwhile, demand is still rising from both funds (a new gold fund recently opened in Hong Kong) and people who tuck gold away under the mattress.
Last week, the World Gold Council reported that demand for gold rose 7% to 736 metric tonnes in the second quarter, compared with the first quarter. And the pace of buying may be picking up — gold dealers in Singapore and Dubai have reported turning away customers looking for one-ounce coins, while the Times of India reports "a shortage of the yellow metal" at local bullion banks.
Money is also pouring into Barclay's iShares Silver Trust (SLV). It now holds 208 million ounces of silver — nearly 40% of annual global mine production — and the trust recently had to add more than 8.5 million ounces of silver in just three days!
In one of the more eyebrow-raising stories I've seen lately, the U.S. Mint briefly suspended sales of American Eagle bullion coins. Government officials say sales are about 50% more than in all of 2007.
"Due to the unprecedented demand for American Eagle gold one-ounce bullion coins, our inventories have been depleted. We are therefore temporarily suspending all sales of these coins," the U.S. Mint told authorized coin dealers. "We hope to resume sales shortly."
http://images.moneyandmarkets.com/1062/American-Eagle-Gold-Coins.jpg American Eagle gold coins are in short supply right now ... The Mint did resume sales, but on a limited basis — literally rationing American Eagles among its customers. Here's a clear-cut case of supply being unable to meet demand.
It seems to me that the price of gold in the futures market is too low, pushed down by the frantic selling of hedge funds that are leveraged to their eyeballs.
There's only one way to fix this disconnect — higher prices. And as hedge funds rush to cover, the snap-back could make your head spin.

Sean Brodrick (http://www.gliq.com/cgi-bin/click?weiss_mam+106202-4+MAM1062SPLIT2+arcotti2@actrix.co.nz)

peat
28-08-2008, 11:48 AM
its possible though, and I seem to recall reading it somewhere that there is no shortage of actual silver.... merely a shortage of pressed Eagles.... because the USA govt is obliged by law to provide these to people when they want them. I'm no conspiracy nut but it does seem odd that they wont provide Eagles even when the price has fallen so far and there must be the actual stuff available at these lower prices. so it does make one wonder what is going on... eg fuel for conspiracy theories.

I guess I find it hard to believe in a shortage when the price has plummetted so much recently. I still have 2/3rds of my accumulated holding (silver) but my stop lossed got triggered on the other. I'm still buying the occasional coin on TradeMe where I can acquire it at bullion value.

arco
01-09-2008, 08:16 AM
Matt Chambers | September 01, 2008


GOLD output in Australia sank to an 18-year low last financial year -- and not even a better fourth quarter could avert the poor result.
What the high metal price gave to producers, soaring energy costs took away.
The drop in output comes as a dramatic increase in costs in the past quarter threatens production at the nation's second-biggest mine, the Kalgoorlie Super Pit.
Added to that was the gold price starting the current quarter with its biggest nominal monthly drop in 25 years.
Australia produced 232 tonnes, or 7.46 million ounces, in the 12 months to June 30, down 7 per cent from the previous year, according to industry analyst Surbiton Associates.
Production in the June quarter remained in the doldrums -- up just 2 tonnes (3 per cent) from the 19-year low reached in the March quarter, to 55 tonnes, or 1.77 million ounces.
That is still 13 per cent lower than last year's June quarter.
Surbiton's Sandra Close said the Australian gold industry had suffered a 20 per cent increase in costs last quarter as oil and West Australian gas prices surged, marking a big acceleration in costs, which had already been moving higher for some time.
"Higher energy costs have contributed to the cost increase," Dr Close said. "You can't draw too many conclusions from one quarter's figures, but there is cause for concern."
That concern was voiced by Super Pit part-owner Newmont last month when it said it was reviewing operations at the iconic open pit, which mines the outback town's old Golden Mile.
Despite higher costs and gold prices dropping $US89 an ounce in August to $US835, production could have bottomed as Newmont's huge $2.4 billion Boddington mine in the south of Western Australia prepares to fire up. The mine is due for first production late this calendar year or early 2009.


http://www.theaustralian.news.com.au/story/0,25197,24271507-643,00.html

arco
08-09-2008, 07:50 PM
September 8, 2008

Japan's enormous high-tech rubbish dumps have become a natural resource for precious metals including gold, silver and indium

Leo Lewis, Asia Business Correspondent

Japan's high-tech rubbish dumps - the vast “urban mines” of landfill outside every big city - have grown so huge that the country now ranks among the biggest natural resource nations in the world.
Tens of millions of defunct mobile phones, discarded televisions, PCs and MP3 players conceal a “virtual lode” of hundreds of tonnes of precious metals. An even greater seam may be lurking forgotten - but not yet discarded - in Japan's attics and garages.
According to new calculations by the National Institute for Materials Science (NIMS) in Tsukuba, Japan has unwittingly accumulated three times as much gold, silver and indium than the entire world uses or buys in a year. In the case of platinum, Japan's urban mines may contain six times annual global consumption.
The institute's leading urban mine expert said that if these electronics-rich treasure troves were properly tapped, supposedly resource-poor Japan would suddenly join the likes of Australia, Canada and Brazil in the top five producers of some elements.
The mines have been accumulated because of the extraordinarily high speed at which Japanese consumers replace gadgets. Of these, the 20million mobile phones replaced by the Japanese each year are especially attractive “ores” for urban miners. Only 13 per cent, about 550 tonnes a year, are recycled, with the remainder thrown away or stored in drawers and cupboards.
The circuit boards of each phone contain a smorgasboard of precious metals: in minute quantities there are silver, lead, zinc, copper, tin, gold, palladium and titanium.
Although other developed countries - particularly the United States and Britain - are thought to have very substantial untapped urban mines of their own, Japan leads the world as an assessor of what its dumps and attics contain in the way of metal resources. Koumei Harada, the director of the institute's strategic use of elements division, has pioneered the calculation of Japan's potential urban mine resources.
By comparing the quantities of metals imported over the past 60 years with what has left Japan inside its electronics, cars and other exported goods, Professor Harada arrived at basic reserves. From this were subtracted theoretical quantities of metal that remain in use.
According to the professor, decades at the forefront of the global consumer electronics industry had left Japan with a tantalising legacy: it has invisibly accumulated stocks of some metals to rival proven worldwide reserves in the ground, but it knows where only about half of it is. Worse, that half is difficult to process.
Now the Ministry of Economy, Trade and Industry is pushing for nationwide collections of old electronics from homes and for ideas about how best to excavate the landfill. Companies such as Asahi Pretec already run urban mines at various plants in Japan. One of its plants retrieved about 15 tonnes of gold last year from a variety of industrial waste.
Professor Harada is part of a team working on establishing “artificial ore” factories at Japan's waste dumps and landfill sites. By his estimates, a tonne of ore from a real goldmine might produce only five grams of actual gold, while a tonne of artificial ore made from reduced mobile phones would yield about 150 grams.



http://business.timesonline.co.uk/tol/business/industry_sectors/natural_resources/article4698917.ece

Craig3215
12-09-2008, 01:17 PM
Martin Armstrong told me a couple of months ago that he could see gold moving down to around the 730 area before resuming its move up to 1500 I'm going to start to accumulate now and load up at 730

arco
12-09-2008, 02:30 PM
Hi Craig

Good to hear Martin is still following his passion.

The weekly chart is showing both a Gartley and a BF on old resistance, so
the turnaround should not be far away.

How do you trade your gold there - physical or what?

rgds - arco

Craig3215
12-09-2008, 11:51 PM
Hey arco,
I use gold etfs in particular dgp is double long and dzz is double short

arco
15-09-2008, 12:31 PM
Thanks Craig


_____________________

Sun Sep 14, 2008 8:51pm EDT


SINGAPORE, Sept 15 (Reuters) - Gold and silver gained more
than 2 percent on Monday buoyed growing concerns about
brokerage firm Lehman Brothers and the stability of U.S.
financial markets.

Gold <XAU=> rose 2.3 percent to $780.85 an ounce at 0043
GMT from Friday's nominal close in New York. Silver <XAG=>
gained 2.6 percent to $11.11. News that talks to rescue Lehman Brothers Holdings
faltered, fueled concerns about the stability of the U.S.
financial system and sparking talk of a possible rate cut
there, boosting gold's safe-haven appeal.

arco
15-09-2008, 06:19 PM
The Gold Report: In our last interview you said gold would unquestionably detach from the dollar. Ten months later, gold is still tethered.

John Embry: The downturn in both gold and silver was literally preposterous in magnitude relative to the rise in the dollar. This was a violent intervention by the paper players. Three U.S. banks on COMEX shorted something like 8,000 contracts in a very short time. That's more ounces than all the world's miners produce in a month.

TGR: Can they keep doing that forever?

JE: No, they can't. This is similar to what happens when you compress a spring. You hold it down but when it comes up, it springs back hard. We'll see a violent reaction in the gold price soon.

TGR: Will we have to wait six months or six weeks?

JE: If gold hasn't moved up by the end of this year, I would be very surprised. People don't realize how distressed the gold mining industry is. Even at $1,000, miners weren't doing very well. At $800, the entire industry is in crisis. Costs have risen so much, nobody's making any real money. In fact, some mines are starting to close.

TGR: Could mines reopen when gold reaches $850 or $900?

JE: Gold would have to be at least $1200 before mines reopen.

TGR: Is now the time for the majors to start acquiring?

JE: I don't understand why the majors aren't acquiring because I've never seen anything like the discrepancy in value between the big cap stocks and the small stuff. Many interesting smaller companies are trading for a song; whereas, Agnico-Eagle and Goldcorp and Kinross are aggressively valued.

TGR: Some of the juniors have lost 80%.

JE: If you had told me we'd see this kind of carnage in the juniors while the gold was still north of $800, I would have said impossible. One of the reasons is that investors are giving up and gold funds, ours included, are under redemption pressure. This creates forced selling with insufficient buying and that leads to the most depressed prices since this cycle began in 2000.

TGR: How long can this go on?

JE: I don't know but I've got some that actually are selling below the cash on their balance sheets.

TGR: Do you want to give us some names?

JE: Orvana Minerals Corp, has an extremely efficient mine and has generated a lot of cash from it—considerably more cash than the stock's trading for. There is $75 million in the bank with a $60 million market cap. Orvana has a very profitable mine plus another ore body that would be easily developed and they are both in the good part of Bolivia.

TGR: You said they couldn't even afford to mine with gold around $800?

JE: You can't get into production because it's hard to attract capital and the capital costs have risen so much, but an existing mine with a good orebody is fine. This credit problem will significantly impact gold production over the next three or four years. There's a bunch of mines coming off the table as they get depleted and the high-grade ores run out. Without new mines, production is going to fall regardless of the gold price. The supply-demand gap, which is already yawning, is growing wider and wider. Central banks will do what they can to fill the gap but if they can't, the price is going to explode.

TGR: You said Orvana has an efficient mine, and money in the bank that exceeds the market cap. Can they bring gold out of the ground profitably?

JE: They're making an extraordinary profit.

TGR: So they have cash flow.

JE: The problem is that it's a short-life mine with only a couple of years left. They do have other assets, although they're being valued at less than nothing.

TGR: Should investors wait for gold to go above $1,000 before investing in the juniors?

JE: Things have gone much farther down than I could have imagined in my worst nightmare. If you are confident that the gold price is going higher, this is an ideal time to be picking away and buying a diversified list of very good quality, cheap juniors. I've made the most money in my life buying things that are out of favor because there's no downside risk, certainly from a fundamental standpoint. When the worm turns, these things could double very quickly. When that happens it'll be hard to buy. Start picking away now, as long as you share my opinion that the gold will see a hefty price rise over the next 12 months.

TGR: How does an investor determine which juniors merit a closer look?

JE: It all revolves around the people and the asset. I look for companies with strong financial support, a legitimate project with a 43-101 resource and sound management. Using those criteria, you can make a reasonable evaluation of what the net asset value is. You can put in your own gold prices while knowing that they're not going to be cash-starved.

TGR: Do we have to work through this panicked selling before stocks will change?

JE: As long as people are abandoning the sector and taking money out of these funds, then there's a lot of irrational selling. The fund manager has no choice but to sell. This is creating a phenomenon where prices don't make much sense. The larger cap stocks are the ones being bid up; they trade because generalists buy them. There's a far bigger pool of capital prepared to buy them. That's why you've got this remarkable discrepancy in valuation between the little guys and the big guys.

TGR: Other people we've interviewed are concerned about a real crash in the overall markets.

JE: We've already had the crash in the junior gold shares. That brings up the naked short selling of these stocks. I think there are grounds for a suit. A lawyer has been phoning me on this subject. Someone is trying to bring a suit against the perpetrators. There has clearly been nefarious activity in these stocks because they get driven down to a level where they can't put their head up without getting pounded back down again.

TGR: If the market crashes, it'll pressure the gold funds.

JE: That assumes that the gold price doesn't explode. If the market crashes, the authorities are going to pour so much money into the system to try to avert economic disaster. Money has to go somewhere. Some of it will go to gold. If the gold price heads higher, you've got the cheapest gold stocks in history. Maybe they won't get dragged down in the crash. Maybe the big caps are going to crash.

TGR: Big caps gold stocks?

JE: Big caps period. Investors have already abandoned the illiquid stocks and huddled in the big caps.

TGR: A lot of people are saying that they see a slowdown in deflation. Do you agree?

JE: I think the problem is potential deflation because I am a great believer in Austrian economics and we've had the greatest credit abuses in history. There's an awful lot of debt and you're stuck creating more of it to keep the momentum going. The real issue here is, can you do it? There is a good argument for a deflationary spiral like the Great Depression. On the other hand, this time paper money isn't anchored. Everything's fiat and the government can create it with the stroke of a pen or the touch of a computer key. If you really want to pin me down, I'd say we're going to have a hyper inflationary depression. The value of money will be destroyed and economic activity will grind to a halt. It'll be the worst of all possible worlds— a South American meltdown. If that happens, the one thing I want to own is gold. I have been investing more in bullion recently than in stocks. I already own some stocks. But I do believe that if bullion performs as I expect it to, the stocks will do well. If you go back to the 1930s, the best performing things on earth were the gold stocks.

TGR: They went down in the beginning.

JE: They did, but these have already gone down. That would make the case that we had the bear market in gold. I guess they could go down 90% from the peak prices, but still the risk/reward heavily favors the reward side. That is not true for large cap stocks, particularly those that make up the indices.

TGR: But if the price of gold doesn't turn around, don't a lot of juniors risk bankruptcy?

JE: If they're not in production and are fairly careful, they can gear back. The ones in production and losing money are at the greatest risk of bankruptcy. If gold doesn't turn soon, they won't be able to finance their operations. A lot of these guys lose money and just kept going out and raising more. They just keep losing money, so they close the mines. That's also very bullish for gold. We're going to have less and less gold in production.

TGR: What about the juniors that aren't in production?

JE: I'm not worried about the ones that have real ore bodies and have gotten pounded down to where they're trading at $10, $15, or $20 an ounce in the ground.

TGR: Because they'll be taken out?

JE: They'll be taken out or they've hit bottom and, as long as they have enough capital to move forward, they can gear down. Small, quality gold shares are proxies for a higher gold price. The problem is that the gold price is so severely suppressed vis a vis other commodities that the whole business has become uneconomical.

TGR: What percentage should an investor have in bullion and in what form?

JE: Central Fund of Canada Limited , and Central GoldTrust are really excellent vehicles in which to hold gold. I'm very leery of funds that have no allocated gold. Whereas, in Central Gold Trust, which I'm involved with, it's a sort of sister company of the Central Fund— so I know the Spicers that run it very well. I know for a fact that you can go look at gold in the vault. So they are perfect vehicles in this environment. If the worst happens and everything goes to hell in a handcart, you want bullion. So the core of your portfolio has to be bullion. Depending on how much money you've got, you can decide what percentage you want to wager on the upside. If the gold price goes where I think it's going soon—to $2,000—then some of these gold stocks will look pretty good. They're depressed enough that they will move faster than gold. They could go up three to five times when gold goes doubles.

TGR: So you recommend a core holding of bullion. Do you believe people should have coins?

JE: Absolutely. I'm a big believer in coins and actually have them in addition to physical gold as part of my position.

TGR: Would the balance be in producers and exploration companies?

JE: I can't pound the table for any of the large cap producers because they don't represent terrific relative value. However, when the gold price goes up, they're going to go up in price. My view is that some of the smaller ones will go up a lot more. It depends on what your goal is. If you only want to protect yourself, own nothing but bullion. But if you want some leverage and to make some money, then you should probably get some intermediate and smaller gold stocks that have been really taken to the wood shed and pounded.

TGR: Do you want to talk about a few of those?

JE: One that I've been a great fan of for quite a while is Wesdome It has performed horribly. It has two operating mines, one in Quebec and another in Ontario. The high Canadian dollar beat them up quite a bit and they were in the red, but now both mines are cash flowing positively. This stock trades around $.85, so it has a market cap of $85 million. If the gold price goes to $2,000, these two mines will spin money and I suspect the stock will go up fivefold. A stock like that at these prices is a gift. It's in production, so you don't have to spend any more money. Quebec is probably the best place on the planet to mine.

TGR: Where are their mines located?

JE: This one is located in Timmins in Ontario.

JE: Going a little further afield just got annihilated. They have four million ounces in the Central African Republic. It was at $1.40 and is now down to $.15. You're buying the people because they discovered the Geita Mine, now in production in Tanzania, which is one of the more successful mines in Africa. This is the best exploration team in Africa. They've got this project in the Central African Republic with a proven reserve and, then another one in Ghana and a third in the Sierra Leone, which they're moving forward. The stock has been blasted, but they've got Audax Petroleum, one of the big Swiss oil companies, which owns 50% of this company, to back stop to any extent required. There's no financing risk; they have assets; and the best mine-finding team in Africa. You get all this for $30 million.

TGR: And it just got clobbered.

JE: I don't understand why. I talked to the company and we went over everything. It's simple. There are more sellers than buyers.

TGR: People are panicking. They're selling anything and everything.

JE: You can come up with a zillion reasons why a stock is going to go lower, but at some point you've got to put the pin in and say, this is really a great value. I believe the gold price is going up a lot. If I buy something and with 10% or 15% on the downside worst case, and I can make five times on the upside, that represents a good investment.

TGR: That brings the buyers out. Everybody's hoping investors return from their summer vacations and start focusing on the values of some of these companies.

JE: It's going to take a fairly significant advance in the gold price. If there's a major stock market debacle and gold moves in the opposite direction that will shine more light on the gold shares and the money will go there.

TGR: You talked during our last interview about African Miners Do you have any comments on them?

JE: Gold Fields, for example, just reported 80 million ounces in reserve and another 246 million ounces in resources. Sure, South Africa is an issue but half of their production is outside of South Africa. I think Gold Fields, for a big cap stock, is literally a gift at these prices. The other ones like African Gold have gotten pounded, I'm not quite sure why – it's just a thin stock and when you get forced selling, it gets driven down. It's got legitimate projects in Ghana and Mali.

TGR: How much lower can they go?

JE: That's the big question. You do the metrics. Calculate how many ounces of resource. What're you paying for it? These stocks are so low I've seldom seen anything cheaper in my career. It's odd that the gold picture is so remarkably bullish, even with this price hit, which I don't think was necessarily a natural hit. I think it was assisted. If the bottom's not near, then my whole thesis on gold is wrong and I don't think it is.

TGR: Could the powers that be continue to drive gold down?

JE: They have a financial crisis of epic proportions and the last thing they want is for gold to become the go-to asset, so they've been throwing everything at it but the kitchen sink. That strategy has resulted in unprecedented shortages of physical gold. Half the bullion dealers and coin dealers in America can't get it.

The U.S. Mint suspended production of Gold Eagles. They claimed it was due to a shortage of blanks. I don't believe that. I think it's a physical shortage. COMEX has created an irrationally low price and people are coming out of the woodwork buying it.

TGR: And they can't replace it.

JE: The fact is that all this stuff at central banks has been leased and swapped and sold into the market. It's gone; it's not coming back. So we're running out. The question is when will it be completely gone—that's when the market will go nuts.

TGR: Are you forecasting that for January of 2009?

JE: That's when we'll have four-digit gold—maybe higher four digits. As this credit crisis unfolds, the gold market can come into its own again. Attempts to discourage people by pounding the gold will end. When everyone realizes what's going on, I think it'll have a salutary effect on the gold price.

TGR: What would be in the top ten holdings?

JE: Aurelian Resources (http://www.theaureport.com/cs/user/print/co/554?x-t=pub.view&id=%7Bid) is an interesting one—arguably the best find in the new century. It has a minimum of 10 to 13 million ounces. Because it's in Ecuador they're having all the problems with Correa's government. Kinross has put in a bid to take them out. The bid has given the stock a lift, but it's a remarkable asset and I hope this deal doesn't go through.

TGR: Another company we've been hearing a lot about recently, too, is Minera Andes Inc.

JE: Rob McEwen put a lot of money into Minera and they have a solid asset in South America. It remains a solid company.

TGR: John, as usual, we appreciate your time.

JE: It's always best to talk when things are at their worst because I think that's when the opportunity is the greatest. When we have another conversation six months from now, I think it'll be a much happier one.

John Embry is chief investment strategist at Sprott Asset Management. Embry, an industry expert in precious metals, has researched the gold sector for over 30 years and has accumulated industry experience as a portfolio management specialist since 1963. He joined SAM as Chief Investment Strategist in March 2003 with focus on the Sprott Gold and Precious Minerals Fund and the Sprott Strategic Offshore Gold Fund, Ltd. Prior to joining Sprott, Embry was Vice-President, Equities and Portfolio Manager at RBC Global Investment Management, a $33 billion organization where he oversaw $5 billion in assets, including the flagship $2.9 billion Royal Canadian Equity Fund and the $250 million Royal Precious Metals Fund.



http://www.tiscali.co.uk/news/newswire.php/news/reuters/2008/09/15/business/financial-havoc-wallops-us-dollar-and-stocks.html&template=/business/feeds/story-template-reuters.html

shasta
15-09-2008, 06:50 PM
The Gold Report: In our last interview you said gold would unquestionably detach from the dollar. Ten months later, gold is still tethered.

John Embry: The downturn in both gold and silver was literally preposterous in magnitude relative to the rise in the dollar. This was a violent intervention by the paper players. Three U.S. banks on COMEX shorted something like 8,000 contracts in a very short time. That's more ounces than all the world's miners produce in a month.

TGR: Can they keep doing that forever?

JE: No, they can't. This is similar to what happens when you compress a spring. You hold it down but when it comes up, it springs back hard. We'll see a violent reaction in the gold price soon.

TGR: Will we have to wait six months or six weeks?

JE: If gold hasn't moved up by the end of this year, I would be very surprised. People don't realize how distressed the gold mining industry is. Even at $1,000, miners weren't doing very well. At $800, the entire industry is in crisis. Costs have risen so much, nobody's making any real money. In fact, some mines are starting to close.

TGR: Could mines reopen when gold reaches $850 or $900?

JE: Gold would have to be at least $1200 before mines reopen.

TGR: Is now the time for the majors to start acquiring?

JE: I don't understand why the majors aren't acquiring because I've never seen anything like the discrepancy in value between the big cap stocks and the small stuff. Many interesting smaller companies are trading for a song; whereas, Agnico-Eagle and Goldcorp and Kinross are aggressively valued.

TGR: Some of the juniors have lost 80%.

JE: If you had told me we'd see this kind of carnage in the juniors while the gold was still north of $800, I would have said impossible. One of the reasons is that investors are giving up and gold funds, ours included, are under redemption pressure. This creates forced selling with insufficient buying and that leads to the most depressed prices since this cycle began in 2000.

TGR: How long can this go on?

JE: I don't know but I've got some that actually are selling below the cash on their balance sheets.

TGR: Do you want to give us some names?

JE: Orvana Minerals Corp, has an extremely efficient mine and has generated a lot of cash from it—considerably more cash than the stock's trading for. There is $75 million in the bank with a $60 million market cap. Orvana has a very profitable mine plus another ore body that would be easily developed and they are both in the good part of Bolivia.

TGR: You said they couldn't even afford to mine with gold around $800?

JE: You can't get into production because it's hard to attract capital and the capital costs have risen so much, but an existing mine with a good orebody is fine. This credit problem will significantly impact gold production over the next three or four years. There's a bunch of mines coming off the table as they get depleted and the high-grade ores run out. Without new mines, production is going to fall regardless of the gold price. The supply-demand gap, which is already yawning, is growing wider and wider. Central banks will do what they can to fill the gap but if they can't, the price is going to explode.

TGR: You said Orvana has an efficient mine, and money in the bank that exceeds the market cap. Can they bring gold out of the ground profitably?

JE: They're making an extraordinary profit.

TGR: So they have cash flow.

JE: The problem is that it's a short-life mine with only a couple of years left. They do have other assets, although they're being valued at less than nothing.

TGR: Should investors wait for gold to go above $1,000 before investing in the juniors?

JE: Things have gone much farther down than I could have imagined in my worst nightmare. If you are confident that the gold price is going higher, this is an ideal time to be picking away and buying a diversified list of very good quality, cheap juniors. I've made the most money in my life buying things that are out of favor because there's no downside risk, certainly from a fundamental standpoint. When the worm turns, these things could double very quickly. When that happens it'll be hard to buy. Start picking away now, as long as you share my opinion that the gold will see a hefty price rise over the next 12 months.

TGR: How does an investor determine which juniors merit a closer look?

JE: It all revolves around the people and the asset. I look for companies with strong financial support, a legitimate project with a 43-101 resource and sound management. Using those criteria, you can make a reasonable evaluation of what the net asset value is. You can put in your own gold prices while knowing that they're not going to be cash-starved.

TGR: Do we have to work through this panicked selling before stocks will change?

JE: As long as people are abandoning the sector and taking money out of these funds, then there's a lot of irrational selling. The fund manager has no choice but to sell. This is creating a phenomenon where prices don't make much sense. The larger cap stocks are the ones being bid up; they trade because generalists buy them. There's a far bigger pool of capital prepared to buy them. That's why you've got this remarkable discrepancy in valuation between the little guys and the big guys.

TGR: Other people we've interviewed are concerned about a real crash in the overall markets.

JE: We've already had the crash in the junior gold shares. That brings up the naked short selling of these stocks. I think there are grounds for a suit. A lawyer has been phoning me on this subject. Someone is trying to bring a suit against the perpetrators. There has clearly been nefarious activity in these stocks because they get driven down to a level where they can't put their head up without getting pounded back down again.

TGR: If the market crashes, it'll pressure the gold funds.

JE: That assumes that the gold price doesn't explode. If the market crashes, the authorities are going to pour so much money into the system to try to avert economic disaster. Money has to go somewhere. Some of it will go to gold. If the gold price heads higher, you've got the cheapest gold stocks in history. Maybe they won't get dragged down in the crash. Maybe the big caps are going to crash.

TGR: Big caps gold stocks?

JE: Big caps period. Investors have already abandoned the illiquid stocks and huddled in the big caps.

TGR: A lot of people are saying that they see a slowdown in deflation. Do you agree?

JE: I think the problem is potential deflation because I am a great believer in Austrian economics and we've had the greatest credit abuses in history. There's an awful lot of debt and you're stuck creating more of it to keep the momentum going. The real issue here is, can you do it? There is a good argument for a deflationary spiral like the Great Depression. On the other hand, this time paper money isn't anchored. Everything's fiat and the government can create it with the stroke of a pen or the touch of a computer key. If you really want to pin me down, I'd say we're going to have a hyper inflationary depression. The value of money will be destroyed and economic activity will grind to a halt. It'll be the worst of all possible worlds— a South American meltdown. If that happens, the one thing I want to own is gold. I have been investing more in bullion recently than in stocks. I already own some stocks. But I do believe that if bullion performs as I expect it to, the stocks will do well. If you go back to the 1930s, the best performing things on earth were the gold stocks.

TGR: They went down in the beginning.

JE: They did, but these have already gone down. That would make the case that we had the bear market in gold. I guess they could go down 90% from the peak prices, but still the risk/reward heavily favors the reward side. That is not true for large cap stocks, particularly those that make up the indices.

TGR: But if the price of gold doesn't turn around, don't a lot of juniors risk bankruptcy?

JE: If they're not in production and are fairly careful, they can gear back. The ones in production and losing money are at the greatest risk of bankruptcy. If gold doesn't turn soon, they won't be able to finance their operations. A lot of these guys lose money and just kept going out and raising more. They just keep losing money, so they close the mines. That's also very bullish for gold. We're going to have less and less gold in production.

TGR: What about the juniors that aren't in production?

JE: I'm not worried about the ones that have real ore bodies and have gotten pounded down to where they're trading at $10, $15, or $20 an ounce in the ground.

TGR: Because they'll be taken out?

JE: They'll be taken out or they've hit bottom and, as long as they have enough capital to move forward, they can gear down. Small, quality gold shares are proxies for a higher gold price. The problem is that the gold price is so severely suppressed vis a vis other commodities that the whole business has become uneconomical.

TGR: What percentage should an investor have in bullion and in what form?

JE: Central Fund of Canada Limited , and Central GoldTrust are really excellent vehicles in which to hold gold. I'm very leery of funds that have no allocated gold. Whereas, in Central Gold Trust, which I'm involved with, it's a sort of sister company of the Central Fund— so I know the Spicers that run it very well. I know for a fact that you can go look at gold in the vault. So they are perfect vehicles in this environment. If the worst happens and everything goes to hell in a handcart, you want bullion. So the core of your portfolio has to be bullion. Depending on how much money you've got, you can decide what percentage you want to wager on the upside. If the gold price goes where I think it's going soon—to $2,000—then some of these gold stocks will look pretty good. They're depressed enough that they will move faster than gold. They could go up three to five times when gold goes doubles.

TGR: So you recommend a core holding of bullion. Do you believe people should have coins?

JE: Absolutely. I'm a big believer in coins and actually have them in addition to physical gold as part of my position.

TGR: Would the balance be in producers and exploration companies?

JE: I can't pound the table for any of the large cap producers because they don't represent terrific relative value. However, when the gold price goes up, they're going to go up in price. My view is that some of the smaller ones will go up a lot more. It depends on what your goal is. If you only want to protect yourself, own nothing but bullion. But if you want some leverage and to make some money, then you should probably get some intermediate and smaller gold stocks that have been really taken to the wood shed and pounded.

TGR: Do you want to talk about a few of those?

JE: One that I've been a great fan of for quite a while is Wesdome It has performed horribly. It has two operating mines, one in Quebec and another in Ontario. The high Canadian dollar beat them up quite a bit and they were in the red, but now both mines are cash flowing positively. This stock trades around $.85, so it has a market cap of $85 million. If the gold price goes to $2,000, these two mines will spin money and I suspect the stock will go up fivefold. A stock like that at these prices is a gift. It's in production, so you don't have to spend any more money. Quebec is probably the best place on the planet to mine.

TGR: Where are their mines located?

JE: This one is located in Timmins in Ontario.

JE: Going a little further afield just got annihilated. They have four million ounces in the Central African Republic. It was at $1.40 and is now down to $.15. You're buying the people because they discovered the Geita Mine, now in production in Tanzania, which is one of the more successful mines in Africa. This is the best exploration team in Africa. They've got this project in the Central African Republic with a proven reserve and, then another one in Ghana and a third in the Sierra Leone, which they're moving forward. The stock has been blasted, but they've got Audax Petroleum, one of the big Swiss oil companies, which owns 50% of this company, to back stop to any extent required. There's no financing risk; they have assets; and the best mine-finding team in Africa. You get all this for $30 million.

TGR: And it just got clobbered.

JE: I don't understand why. I talked to the company and we went over everything. It's simple. There are more sellers than buyers.

TGR: People are panicking. They're selling anything and everything.

JE: You can come up with a zillion reasons why a stock is going to go lower, but at some point you've got to put the pin in and say, this is really a great value. I believe the gold price is going up a lot. If I buy something and with 10% or 15% on the downside worst case, and I can make five times on the upside, that represents a good investment.

TGR: That brings the buyers out. Everybody's hoping investors return from their summer vacations and start focusing on the values of some of these companies.

JE: It's going to take a fairly significant advance in the gold price. If there's a major stock market debacle and gold moves in the opposite direction that will shine more light on the gold shares and the money will go there.

TGR: You talked during our last interview about African Miners Do you have any comments on them?

JE: Gold Fields, for example, just reported 80 million ounces in reserve and another 246 million ounces in resources. Sure, South Africa is an issue but half of their production is outside of South Africa. I think Gold Fields, for a big cap stock, is literally a gift at these prices. The other ones like African Gold have gotten pounded, I'm not quite sure why – it's just a thin stock and when you get forced selling, it gets driven down. It's got legitimate projects in Ghana and Mali.

TGR: How much lower can they go?

JE: That's the big question. You do the metrics. Calculate how many ounces of resource. What're you paying for it? These stocks are so low I've seldom seen anything cheaper in my career. It's odd that the gold picture is so remarkably bullish, even with this price hit, which I don't think was necessarily a natural hit. I think it was assisted. If the bottom's not near, then my whole thesis on gold is wrong and I don't think it is.

TGR: Could the powers that be continue to drive gold down?

JE: They have a financial crisis of epic proportions and the last thing they want is for gold to become the go-to asset, so they've been throwing everything at it but the kitchen sink. That strategy has resulted in unprecedented shortages of physical gold. Half the bullion dealers and coin dealers in America can't get it.

The U.S. Mint suspended production of Gold Eagles. They claimed it was due to a shortage of blanks. I don't believe that. I think it's a physical shortage. COMEX has created an irrationally low price and people are coming out of the woodwork buying it.

TGR: And they can't replace it.

JE: The fact is that all this stuff at central banks has been leased and swapped and sold into the market. It's gone; it's not coming back. So we're running out. The question is when will it be completely gone—that's when the market will go nuts.

TGR: Are you forecasting that for January of 2009?

JE: That's when we'll have four-digit gold—maybe higher four digits. As this credit crisis unfolds, the gold market can come into its own again. Attempts to discourage people by pounding the gold will end. When everyone realizes what's going on, I think it'll have a salutary effect on the gold price.

TGR: What would be in the top ten holdings?

JE: Aurelian Resources (http://www.theaureport.com/cs/user/print/co/554?x-t=pub.view&id=%7Bid) is an interesting one—arguably the best find in the new century. It has a minimum of 10 to 13 million ounces. Because it's in Ecuador they're having all the problems with Correa's government. Kinross has put in a bid to take them out. The bid has given the stock a lift, but it's a remarkable asset and I hope this deal doesn't go through.

TGR: Another company we've been hearing a lot about recently, too, is Minera Andes Inc.

JE: Rob McEwen put a lot of money into Minera and they have a solid asset in South America. It remains a solid company.

TGR: John, as usual, we appreciate your time.

JE: It's always best to talk when things are at their worst because I think that's when the opportunity is the greatest. When we have another conversation six months from now, I think it'll be a much happier one.

John Embry is chief investment strategist at Sprott Asset Management. Embry, an industry expert in precious metals, has researched the gold sector for over 30 years and has accumulated industry experience as a portfolio management specialist since 1963. He joined SAM as Chief Investment Strategist in March 2003 with focus on the Sprott Gold and Precious Minerals Fund and the Sprott Strategic Offshore Gold Fund, Ltd. Prior to joining Sprott, Embry was Vice-President, Equities and Portfolio Manager at RBC Global Investment Management, a $33 billion organization where he oversaw $5 billion in assets, including the flagship $2.9 billion Royal Canadian Equity Fund and the $250 million Royal Precious Metals Fund.



http://www.tiscali.co.uk/news/newswire.php/news/reuters/2008/09/15/business/financial-havoc-wallops-us-dollar-and-stocks.html&template=/business/feeds/story-template-reuters.html


Interesting article, thanks Arco

I believe Silver will follow even stronger than Gold when it does start to move ;)

peat
18-09-2008, 06:06 AM
you've been posting about gold a bit lately arco. I presume you've been buying. I closed out this morning just now after holding some for a few days...

arco
18-09-2008, 07:24 AM
Yes Peat.....quite an explosive move. Nice when a plan comes together.

I had to re-buy a few that stopped out last week just near the bottom.....but its been looking pretty positive (and silver as well).

:)

arco
18-09-2008, 07:31 AM
.......................Gold also benefited from safe-haven buying, with bullion prices heading for their largest one-day gain for 20 years, leaping 11.2 per cent to a three-week high of $864.70 a troy ounce.

http://www.ft.com/cms/s/0/8058d308-84d3-11dd-b148-0000779fd18c.html

peat
06-10-2008, 06:02 PM
Heres a quote from Friday (I'm back home and catching up on the news a bit)



As the crisis on Wall Street deepens, retail investors, who can't afford the high cost of trading in the futures markets, have been increasing their holdings of gold coins as a safe haven. The U.S. Mint said last week it was temporarily suspending sales of American Buffalo gold 1-ounce bullion coins after soaring demand depleted inventories. The Mint had previously halted sales of American Eagle 1-ounce gold coin in August. Gold held by the SPDR Gold Trust, the largest gold ETF, surged 16% in September to 755.26 tons. That would rank the fund as the eighth-largest worldwide in gold holdings. The U.S. government, the biggest gold holder, has 8,134 tons in reserves as of September.

arco
06-10-2008, 06:25 PM
Hi Peat

Similar info and more here


http://www.moneyandmarkets.com/Issues.aspx?Your-Own-Golden-Parachute-2364

patsy
07-10-2008, 02:18 PM
Hi Craig


How do you trade your gold there - physical or what?

rgds - arco


Apart from GLD as an ETF in the NYSE, I suggest you look at GOLD in the ASX. I bought some bullion through NZ Mint but I think that GLD and GOLD are the way to go. Less hassles and more liquidity.

shasta
07-10-2008, 09:23 PM
Apart from GLD as an ETF in the NYSE, I suggest you look at GOLD in the ASX. I bought some bullion through NZ Mint but I think that GLD and GOLD are the way to go. Less hassles and more liquidity.

Golds on the move & looking promising...

Currently at $US877.90/oz & with the FX at .7165 = $A1,225/oz

Gold & Silver to rally hard thru the end of 2008 & into 2009 ;)

arco
22-10-2008, 06:53 PM
Just wonder if the next stop for Gold is the grey box in the lower RH corner.

.http://www.aussiestockforums.com/forums/attachment.php?attachmentid=25014&stc=1&d=1224658076

shasta
22-10-2008, 07:16 PM
Just wonder if the next stop for Gold is the grey box in the lower RH corner.

.http://www.aussiestockforums.com/forums/attachment.php?attachmentid=25014&stc=1&d=1224658076

Arco

Are you able to repost that chart, it's not showing up?

I'm wanting to see whether Gold will bounce off $US750/oz, i see that as an important support level (just need confirmation of it)

Thanks

arco
22-10-2008, 07:39 PM
Hi Shasta

Try this - let me know if its still not showing.

Size is a problem on ST ;)

rgds - arco

shasta
22-10-2008, 07:41 PM
Hi Shasta

Try this - let me know if its still not showing.

Size is a problem on ST ;)

rgds - arco

Thats great, thanks again Arco :)

airedale
22-10-2008, 08:17 PM
Hi Arco, pog was over US$ 900 a few short weeks ago. With this volatility the grey box in the bottom right corner is possible. But it is hard to predict. The US printing press must keep going, so where does that take gold.

Packersoldkidney
22-10-2008, 10:44 PM
Hi Arco, pog was over US$ 900 a few short weeks ago. With this volatility the grey box in the bottom right corner is possible. But it is hard to predict. The US printing press must keep going, so where does that take gold.

We will see much more deflation in the POG before we see inflation.....the money handed out already by the US Fed and US government barely scratches the surface of what has already been lost in the credit crunch.

lakedaemonian
23-10-2008, 07:30 AM
We will see much more deflation in the POG before we see inflation.....the money handed out already by the US Fed and US government barely scratches the surface of what has already been lost in the credit crunch.

I agree.....I'm still thinking deflationary/disinflationary for the time being.

But in my opinion, once the mass bailouts gain traction......hold on for a reinflationary ride on a rocket.

Gold now in the low 700's today.

How low will it go?

Not sure......but I'm definitely a buyer here....but a VERY cautious buyer...I'm still averaging UP.....but a couple more good sized purchases will have me averaging DOWN :)

Personally, I think it's inevitable that gold is going to sky since the entire world seems happy enough to choose inflation over deflation.

What I'm trying to focus on is finding leading indicators I'm comfortable with that signal the end of deflation/disinflation and the beginning of reinflation in order to consider bigger/bolder entry points....as well as getting a handle on how long the change from one to the other will take to truly kick in.....giving me the comfort level to exchange devaluing cash or cash-like for tangible "stuff".

If the deflation/disinflation changing to reinflation "big picture" doesn't change...I expect to be invested well over 50% in commodities within approx. 24 months roughly 1/3,1/3,1/3 in Ag, PM, and energy.

One thing I'm not sure is a help or a hindrance at times is the growing disparity between spot price and physical.

arco
23-10-2008, 07:36 AM
Gold was an overnight sensation for me...........+3500 atm...................and heading for the grey box as mentioned/shown in my post yesterdayGTA - arco

shasta
23-10-2008, 09:29 AM
Gold was an overnight sensation for me...........+3500 atm...................and heading for the grey box as mentioned/shown in my post yesterdayGTA - arco

Gold smashed thru $US750/oz like a bulldozer, in free fall mode now ouch

Copper is worse :confused:

ollie
23-10-2008, 10:24 AM
Out of my depth here but did read .IF gold falls thru $740 the next level is $560. ??

ollie
23-10-2008, 10:47 AM
Whats the best, easiest way to buy gold. There's no physical access in my City.I read about gold warrants from Perth mint etc. Is it better to own the real deal, coins etc. ?? I notice a 5% fee between buying and selling. Thanks.

airedale
23-10-2008, 12:28 PM
Hi Ollie, google NZ mint. I have no experience of buying the metal, but it may give you a starting point.

arco
23-10-2008, 01:30 PM
Buying physical is pretty expensive.....................

I checked last Tuesday at Auckland Bullion.

Buying price was then NZ$1455.56 .......Plus a $15 bar charge.
The purchase back price was $1279. So an immediate loss of $191 or about 13%.

You might be better off putting that amount with Oanda (who also pay 4% interest when the money is laying idle).

Remember storage as well. If you are buying a large number of bars a safety deposit box will be an additional cost.

arco

dumbass
24-10-2008, 05:41 AM
gold chart from all time high counts best as a corrective move lower.

it doesnt look like a new impulse wave lower but overlapping corrrective waves.

downward channel developing with possibilty of 680 coming into play which may be a good place to look for a reversal.

JBmurc
24-10-2008, 04:40 PM
In the October 22 session on the TOCOM Goldman Sachs COVERED 23 short contracts and BOUGHT 703 long contracts which brings their long position to 2,971 contracts and makes them now NET LONG 543 contracts. This is the LARGEST long position they have held in 30 months. In 30 months they have been net short every day except for two days. The only other day they were net long was on 9/29/08 and was only 28 contracts net long."

shasta
24-10-2008, 05:04 PM
In the October 22 session on the TOCOM Goldman Sachs COVERED 23 short contracts and BOUGHT 703 long contracts which brings their long position to 2,971 contracts and makes them now NET LONG 543 contracts. This is the LARGEST long position they have held in 30 months. In 30 months they have been net short every day except for two days. The only other day they were net long was on 9/29/08 and was only 28 contracts net long."

JBMurc

I always thought $US750/oz would be the bottom, before a spring back up past $US1000/oz again & beyond...

Gold smashed thru that barrier & down to a 12 month lows, so now im not so sure...:confused:

What i do believe is that Gold & in particular Silver will reach new highs sometime in 2009.

How long can the US keep printing money & putting a plaster on a shark bite?

shasta
24-10-2008, 10:06 PM
JBMurc

I always thought $US750/oz would be the bottom, before a spring back up past $US1000/oz again & beyond...

Gold smashed thru that barrier & down to a 12 month lows, so now im not so sure...:confused:

What i do believe is that Gold & in particular Silver will reach new highs sometime in 2009.

How long can the US keep printing money & putting a plaster on a shark bite?


Holly hell, Gold & silver have gone and sh*t themselves :eek:

arco
25-10-2008, 08:28 AM
If you check the Ichimoku thread I put up some gold charts yesterday.

JBmurc
25-10-2008, 01:11 PM
yeah I see GOLD falling like a stone of late very scary when I have a BULL WARRANT in GOLD 910 jan 25 exp. need GOLD to rally strong over NOV-DEC
Hoping the major shorts all start covering soon

GOLD up $13 atm

arco
25-10-2008, 01:36 PM
Keeping my fingers crossed for you JB.

FYI. I noticed this today from Colin Twiggs
Gold Pennant

By Colin Twiggs
October 21, 2008 5:00 a.m. ET (8:00 p.m. AET)
These extracts from my trading diary are for educational purposes and should not be interpreted as investment or trading advice. Full terms and conditions can be found at Terms of Use (http://www.incrediblecharts.com/legal_vizhon/terms_of_use.htm).
Gold (http://www.incrediblecharts.com/tradingdiary/2008-10-21_gold_forex.php#gold)

Since breaking through support at $820, spot gold has consolidated in a small pennant, signaling continuation. Expect a test of $740. Failure would offer a target of $560, calculated as 740 - ( 920 - 740 ). Respect of support is less likely because of the down-trend; and would signal another test of $920.

dumbass
26-10-2008, 08:13 AM
gold chart from all time high counts best as a corrective move lower.

it doesnt look like a new impulse wave lower but overlapping corrrective waves.

downward channel developing with possibilty of 680 coming into play which may be a good place to look for a reversal.

680 hit and reversed

theres quite a bit of evidence to suggest gold may be ready to run to the upside

ananda77
26-10-2008, 01:36 PM
680 hit and reversed

theres quite a bit of evidence to suggest gold may be ready to run to the upside

...agree wholeheartedly with that sentiment, although I DO NOT CARE ONE BIT whether or not bullion makes Trash Cash in the short term;

...it does look like as if the US$-run, impressive as it was, is coming to an end;

...am still wondering whether or not the bullion shortage was 'by Design' or a 'real' as a result of just not enough prefabricated stock; personal sentiment leans toward 'real';

...anyway, think the only reason bullion got viciously hammered as it did during the acute crisis and the US$ became the preferred safety joice of investors worldwide is, because the physical bullion market was simply unable to play it's safety role by supplying enough bars and coins;

...no matter what, this is the time now to look forward to physical bullion as much as you can afford as part of your portfolio, as the foundations for the next, even more vicious crisis are now being laid with unerring precision...and in the meantime till the next one hits even harder, the buying power of trash cash will be steadily eroded day after day...

Kind Regards

shasta
26-10-2008, 02:51 PM
...agree wholeheartedly with that sentiment, although I DO NOT CARE ONE BIT whether or not bullion makes Trash Cash in the short term;

...it does look like as if the US$-run, impressive as it was, is coming to an end;

...am still wondering whether or not the bullion shortage was 'by Design' or a 'real' as a result of just not enough prefabricated stock; personal sentiment leans toward 'real';

...anyway, think the only reason bullion got viciously hammered as it did during the acute crisis and the US$ became the preferred safety joice of investors worldwide is, because the physical bullion market was simply unable to play it's safety role by supplying enough bars and coins;

...no matter what, this is the time now to look forward to physical bullion as much as you can afford as part of your portfolio, as the foundations for the next, even more vicious crisis are now being laid with unerring precision...and in the meantime till the next one hits even harder, the buying power of trash cash will be steadily eroded day after day...

Kind Regards

It’s gold rush, even at premium

NAGPUR: The global slowdown brought a Dhanteras bonanza for Indian consumers. Gold prices crashed right amidst the festive season and consumers rushed to make Dhanteras purchases. So heavy has been the demand that in Nagpur gold (http://timesofindia.indiatimes.com/Cities/Its_gold_rush_even_at_premium/rssarticleshow/3641561.cms#) was being quoted at a premium of Rs 400 against its basic market rate of Rs 12,000 per tola (10 grams) on Saturday. Traders say the situation will continue on Sunday too. World Gold Council claimed that 50 tonnes of gold was sold in the last 20 days in the country.

Gold is weak in the international market for a host of factors. Firstly, financial institutions in the West are resorting to selling off their gold holdings to tide over the liquidity crisis. “This has proved a boon for Indian consumer as the yellow metal has become cheaper at home,” said Ashok Minawala president of All India Gems and Jewellery Federation. Many harried speculators in the US had squared off their trades, pulling down the rates too, add traders.

Gold rates fell to $699 per ounce on Friday before settling at $732. This was a god-sent for Indian consumers, who are eager to buy gold on Dhanteras. Just before the auspicious day, prices dwindled to Rs 12,000 per tola (10 grams) as compared to an all-time high of Rs 14,000. Even traders who were expecting a dull Dhanteras had their cash registers ringing.

In fact, jewellers are now faced with a supply crunch and wholesalers are charging a premium over and above the base price, which is calculated by adding the local taxes (http://timesofindia.indiatimes.com/Cities/Its_gold_rush_even_at_premium/rssarticleshow/3641561.cms#) to the dollar rates.

Nilesh Rathi of SMS Bhav, an online rate information agency, said that against the wholesale price of Rs 12,100 in Mumbai which is the centre, in Nagpur it is being quoted at Rs 12,400, while at some counters it is as high as Rs 12,600. There is a bank holiday on Sunday, so are bullion traders closed for Diwali, which has put tremendous pressure on the supply side leading to the premium. The rates in bigger centres like Mumbai, Delhi or Ahmedabad are between Rs 12,100 to 12,150 due to the proximity of supply points. Even many of the couriers who ferry gold to smaller centres are on a vacation which has added to the supply shortage.

It is the middle class buyer who is driving the market. The sixth pay commission arrears has brought a huge funds in the market. So did several employees in the private sector get bonus. “A windfall gain coupled with low rates has buoyed the buying,” said Ajay Shah of Shreeji Jewellers.

Kumudini Kadhao, a housewife had no plans to buy gold this year, had the rates not fallen. “I feel the rates are comfortable for me to purchase. It has been a tradition in our house to buy gold on Dhanteras and the low prices have surely helped.”

Sudhanshu Mishra, an executive in a private firm said, says he could buy one more ornament for his wife due to the low prices. Otherwise, he had plans to buy just for namesake this Dhanteras. So were Ravindra and Pratima Dewtale, happy over the fall in prices. “It has been a Dhanteras gift for us,” said the couple.

arco
27-10-2008, 08:07 PM
Good evening day trading gold.

All positions closed

+3200

.

peat
29-10-2008, 09:36 PM
is this an a-b-c with c forming a diagonal triangle
looking for a downside breakout , maybe already starting...

guess not then ....

dumbass
31-10-2008, 05:34 AM
gold chart from all time high counts best as a corrective move lower.

it doesnt look like a new impulse wave lower but overlapping corrrective waves.

downward channel developing with possibilty of 680 coming into play which may be a good place to look for a reversal.

i reckon it could be a bottom in, and a leading diagonal in wave 1 position

wave 2 in progress which should provide a safe entry for a long.

maybe 700 with a stop at 670

arco
31-10-2008, 08:38 AM
Hi DB.
Short at the moment, currently +1195

......................looking for the target area.


Heres a picture link if the chart doesn't show up well enough.

http://www.aussiestockforums.com/forums/attachment.php?attachmentid=25308&stc=1&thumb=1&d=1225395093

dumbass
31-10-2008, 10:02 AM
hey arco, what is your target area cant see it on chart

arco
31-10-2008, 12:02 PM
Hi DB

Action has slowed up a bit, but 50% of the up move
is 729.90

Currently +1470

rgds - arco

dumbass
31-10-2008, 12:46 PM
im hoping for a nice abc zigzag maybe printing a gartley if the gods are kind.

waiting for a test of 61.8 for a long

arco
31-10-2008, 12:49 PM
Hi DB

I've just closed that one off.....gotta be happy with +2100

rgds - arco


better picture here if you want it

http://www.aussiestockforums.com/forums/attachment.php?attachmentid=25316&stc=1&thumb=1&d=1225413871

arco
04-11-2008, 11:32 AM
.
Nice start ........................

First trade of a new week on the rejection off bearish Kumo

+1000 just taken

GTA - arco

Or better pic here.
http://www.aussiestockforums.com/forums/attachment.php?attachmentid=25435&stc=1&thumb=1&d=1225740607

arco
05-11-2008, 08:50 AM
There was no Ichi signal on Gold before I closed up the office last night, but Silver gave a signal on the 15M.

I left the order without a TP but being in the Land of Nod I missed the opportunity to grab a decent profit circa +600 near the high of 10.532 (entry 9.892). Anyway current profit +325

SL is above entry, so I be monitoring closely to see how it performs.

GTA - arco

improved chart here
http://www.aussiestockforums.com/forums/attachment.php?attachmentid=25465&stc=1&thumb=1&d=1225829165

peat
05-11-2008, 09:21 AM
i noticed this morning that silver seemed to have retraced a lot more than gold.... seems to be the poor ugly sister these days....

arco
05-11-2008, 10:41 AM
.

Yeah...a bit slow now Peat - I took +323

arco
13-11-2008, 07:25 AM
Placed the order before I shut up the office.
(Took the pic shortly after placing the trade)

Amazed to see its already hit the TP (719.15)

+1200

Didnt quite expect such a large o/n fall.

rgds - arco

arco
20-11-2008, 09:04 AM
Someone somewhere needs a big load................

Hi,

I have person who is interested in buying physical gold 1 tonne from bank to bank transfer.
Anybody has such offers mail me at air2885@yahoo.co.in

Thanks & Best Regards,
Ravi

peat
20-11-2008, 09:48 AM
32000 oz's !!!
23 Mill USD approx

need a big bed to hide that under :rolleyes:

arco
20-11-2008, 12:57 PM
From Sean Broderick

Our oil-rich friends in the Middle East are scared. How do I know?
Because they are buying gold like crazy!
First, we got the news that Saudi investors spent $3.47 BILLION on gold in a recent two-week period. On a ratio-to-GDP basis, that’s like investors in the U.S. spending $131 BILLION.
Why are they doing this? The only explanation I’ve heard is that the Saudis are turning to gold as a safe haven in the midst of the global financial crisis. And since the financial crisis kicked into high gear in August … something must be scaring them quite a bit more right now.
Second, Reuters reports that Iran is converting some of its foreign currency reserves to gold. Iran has $120 billion in foreign currency reserves … there’s no details on just how much was shoveled into the yellow metal.

Third, gold dealers in Dubai reported running low on gold during the recent Indian holiday, the Festival of Lights, a traditional time for Indians to buy gold. More than 50% of the population of Dubai originally comes from India. And about 20% of the world’s gold is traded in Dubai.
The world is in the grip of economic hard times — over 40 countries are officially in a recession. Japan just joined that unhappy club. And the euro-zone nations are already there. We also know that the forces moving the market now seem to be deflationary, not inflationary. That means the value of the U.S. dollar is going up, and the price of gold is trending lower.
But could our friends in the Middle East be thinking beyond the current deflationary spiral? Gold is traditionally a hedge against calamity. So I ask again, what are the oil sheiks afraid of?


While gold prices are going lower in the short-term as deflationary forces tighten their grip, there are also longer-term forces that are quite bullish for gold …


Chinese investors’ demand for gold is rising. Investment demand hit 38.4 metric tonnes in the first nine months of this year against 24 tonnes for the whole of 2007.
Demand for gold jewelry in China reached 241.6 tonnes in the first nine months of 2008, compared with 302 tonnes for all of 2007, when gold jewelry demand grew by 26%. China is the world’s second-largest gold consumer.
Sources in the Indian market and preliminary data on Indian imports point to a strong revival in Indian jewelry demand during this year’s third quarter.
In South Africa, gold mining output plunged 17.7% in September compared to a year earlier.
Global mine production of gold declined by 4% year-on-year in the second quarter to 590 tonnes, bringing output in the first half the year to 1,133 tonnes, 6% below the same period a year earlier.

Still, this long-term good news is cold comfort when prices are trending lower in the short-term. So it must be other things driving the Saudis and Iranians into gold. For example …
http://images.moneyandmarkets.com/1158/shipping-costs.gif The Collapse of the
Global Cargo Trade
The Baltic Dry Index sounds like a weather report, but what it really does is track the price of shipping bulk cargo — such as coal, iron ore, cotton and grain. And recently, the Baltic Dry Index has fallen through the floor.
In real dollar terms, at the peak of the market, a 170,000-tonne Capesize bulk carrier cost $234,000 to rent. Recently, it was $5,600 — that’s a crash of over 90%.
Why is this happening?
Two reasons …


The falling demand for products like cars. Auto sales are falling in the U.S., Germany, France, Japan and more. The pace of car sales growth is also slowing down in China.
International shipping works on “letter of credit.” These financial guarantees are issued to buyers of bulk cargo by their banks. This system has greased the wheels of global trade for the last 400 years. With the collapse of the credit market — and banks now sitting on their hands, refusing to lend — the wheels of global shipping are grinding to a halt.

How bad is this?
Peter Kerr-Dineen, chairman of Howe Robinson shipbrokers, didn’t mince words when he described the crisis to the British press:

“This is a nuclear bomb in the freight market and in world trade. Liquidity has to return because if there is insufficient money to provide standard finance, world trade will be sharply cut back and economic growth will implode.”
Or as the London Banker blog put it:

“If cargo trade stops, a whole lot of supply chain disruption starts. If the ore doesn’t go to the refinery, there is no plate steel. If the plate steel doesn’t get shipped, there is nothing to fabricate into components. If there are no components, there is nothing to assemble in the factory. If the factory closes the assembly line, there are no finished goods. If there are no finished goods, there is nothing to restock the shelves of the shops. If there is nothing in the shops, the consumers don’t buy. If the consumers don’t buy, there is no Christmas.”
http://images.moneyandmarkets.com/1158/cargo-trade.jpg World trade has collapsed because the demand for goods has plummeted and available credit has dried up. In my view … and perhaps the view of the Saudis who are buying gold … there is an even worse risk.
If bulk shippers can’t buy cargoes, then a lot of U.S. grain could end up rotting in warehouses while big portions of the world go hungry.
The Saudis, by the way, are the biggest importer of food in the Middle East. They probably have the money to pay cash for their food shipments.
But for the approximately 2.7 billion people in the world who spend 80% of their income on food, a disruption in the global shipping trade could mean the difference between quiet poverty and all-out rioting.
In addition, the Saudis are also worried about …
The Collapse of
U.S. Oil Imports
The oil producers are used to a world where U.S. oil imports always go up. But that world has been turned on its head. In September, crude oil imports dropped to 8.4 million barrels per day, down a whopping 16.5% from the average of 10.1 million barrels registered a year earlier.
http://images.moneyandmarkets.com/1158/crude-oil.gif This is helping the U.S. trade deficit, but for all the wrong reasons. I’ve often said the way to get lower oil prices is through conservation. Now though, Americans are being forced to conserve by economic hardship.
And since the U.S. uses one-fourth of the world’s oil, our falling imports are a major driver of cratering oil prices …
There is strong support for oil at $50. But you know that the Saudis, Iranians, Venezuelans and other OPEC heavyweights made their budget plans based on much higher prices. And cheap oil means the only way they can make up revenue is by pumping more oil … which should weigh on prices even more.
Looking forward, it gets worse for the oil producers …
http://images.moneyandmarkets.com/1158/crude-oil-uptrend.gif Just last week, the Energy Information Agency projected that OPEC could earn $595 billion in 2009. That’s way, way down from projections of $979 billion of net oil export revenues in 2008, and even lower than the $671 billion it earned in 2007.
Saudi Arabia earns 29% of OPEC’s total revenues. If their revenues go back to 2006 levels, what will that do to the political situation in a country that is already sitting on a fundamentalist Islamic powder keg?
Yeah, that might be a really good reason for the Saudi fat-cats to buy gold!
These are just two of the world-class problems that may be scaring Middle East investors into gold.
I could go on. There are plenty of good reasons people might want to buy gold. Sure, deflation is putting downward pressure on gold … on paper. But just try buying physical gold anywhere near the paper price.
Pricing in a
Government Default?
While gold is traditionally a haven of safety, that’s not how it played out over the past couple months. Instead, we saw risk-adverse investors dump gold along with other asset classes and flee to the safety of cash.
Maybe the mighty dollar has more upside. But remember that the U.S. dollar is backed by “the full faith and credit of the U.S. government.”
Do you have a lot of faith in the U.S. government? I’d say the faith of the world has been shaken by recent events.
And apparently I’m not the only one who thinks that. Take a look at my next chart, which shows the 10-year credit default swap spread on U.S. Treasuries — a form of insurance contract against issuer default.
http://images.moneyandmarkets.com/1158/cds-spread.gif The cost of insuring against a U.S. government default is soaring. And similar trends exist in the bond markets of Germany and Britain.
I think this is because investors are pricing in the massive bailouts that central banks are throwing at their markets. For instance, the U.S. bailouts will add enormously to our country’s already staggering national debt. According to CNBC data, the cost of all the bailouts that have been going on for months has now hit a total of $4.2 TRILLION!
In fact, Morgan Stanley recently estimated that the 2009 fiscal deficit in the U.S. would reach 12.5%. That’s more than twice the previous record of 6% set in 1983.
As a percentage of GDP, the U.S. national debt should pass 70% next year. That’s lower than the 122% at the end of World War II. Yet we aren’t fighting World War II, are we? That ended rather abruptly — this crisis won’t. And the odds are our fiscal picture will get worse, not better.
Under the circumstances, maybe investors in Saudi Arabia and Dubai may just be ahead of the curve. Maybe having some gold — the ultimate safe haven against troubled times — is the right thing to do.
I’m not saying the U.S. government is going to default … I’m saying the possibility of that happening could be priced in more ways than one. And that’s the kind of environment where gold could really shine.
Consider Buying Gold on Dips …
And Hold for a Wild Ride
Physical gold is always nice. But exchange-traded funds have made gold buying a lot easier.
I’m talking about the SPDR Gold Shares ETF (GLD) and the Barclays iShares Comex Gold Trust (IAU). They are fixed at 1/10th the price of gold, minus a small amount to account for fees.
That means if gold is trading at $730 an ounce, you can buy the GLD or the IAU for about $73. And they are backed up by gold bullion in a vault.
There are scary forces on the march in the global economy. A little golden insurance may help you sleep a whole lot better.
All the best,
Sean




http://www.moneyandmarkets.com/are-oil-rich-sheiks-being-scared-into-gold-6-28144

airedale
20-11-2008, 01:37 PM
Hi Arco, and still the POG has not risen.Either: There is massive manipulation going on, or this is the mother of all buying opportunities.

arco
20-11-2008, 03:07 PM
.

Yep, I wonder if Sean has put his money where his mouth is.

http://www.aussiestockforums.com/forums/images/smilies/deadhorse2.gif

ananda77
20-11-2008, 05:33 PM
Arco:

...since you are reading 'moneyandmarkets', have you come across this one:

The G-20s secret debt solution
http://www.moneyandmarkets.com/the-g-20s-secret-debt-solution-27996

...no one really knows if it is going to happen, but it definitely pays to be hedged for such an event.
I mean, how else can the immense worldwide debts be purged short of running into a full blown depression more severe than anything the world has seen before.
Monetizing the debts seems the logical way to do it.

Kind Regards

arco
20-11-2008, 06:26 PM
Arco:

...since you are reading 'moneyandmarkets', have you come across this one:

The G-20s secret debt solution
http://www.moneyandmarkets.com/the-g-20s-secret-debt-solution-27996

...no one really knows if it is going to happen, but it definitely pays to be hedged for such an event.
I mean, how else can the immense worldwide debts be purged short of running into a full blown depression more severe than anything the world has seen before.
Monetizing the debts seems the logical way to do it.

Kind Regards

Yes I did read that, but it seems unlikely IMO.......although never say never

ananda77
22-11-2008, 01:51 AM
arco:

....Tarp2? Tarp3? sometime in 2009 as trillions of due CDO contractual obligations will 'officially' reveal their real market value...

...rating agencies downgrading US government debt in 2009 as a result of further bail outs

...makes perfect sense, physical gold holdings around the globe -already soaring-

Kind Regards

shasta
22-11-2008, 11:13 AM
arco:

....Tarp2? Tarp3? sometime in 2009 as trillions of due CDO contractual obligations will 'officially' reveal their real market value...

...rating agencies downgrading US government debt in 2009 as a result of further bail outs

...makes perfect sense, physical gold holdings around the globe -already soaring-

Kind Regards

Is this the start of the Gold/Silver precious metals run?

http://www.kitco.com/images/live/gold.gif (javascript:NewWindow('/glossary/markets.html','AU','top=50,left=200,width=500,heig ht=350,scrollbars=yes'))

George
22-11-2008, 03:10 PM
Check out NCM - each time the gold price moved 50c the sp moved up or down about 4.00, a $100 move equalled an 8.00 move and a $190+ move equalled 10-12.00 difference in the SP.
While the price jumped over $2 on Friday, so did many others and this was before the 50c move up in gold. Therefore, could be a move to 25-26.00 on Monday - will be looking to go long if it opens much lower than this to add to my small position at 20.06. If it opens high enough, what do you do? Hold for a possible further rise in gold or take profits. Nice position to be in though.
George

George
24-11-2008, 12:56 PM
Opened at 2250, straight up to 2310 sold at 2330 but bought back in at 2315 for a possible target of 25-2600. Strength there while many others are retreating. Gold price holding up.

George
24-11-2008, 02:16 PM
Gold slipping from 808 to 793, sold out at 24 and watching. NCM seems to be holding fairly well in a tight range between 2390 and 2410, could go either way. Perhaps a $4 move has been factored in from the 19-20.00 area!!

George
25-11-2008, 06:49 AM
Sold out of NCM yesterday now gold up overnight - tough. Possible rise to around
25.00 for NCM today with gold about 820. Possible resistance at about 870-880,
with NCM at about 26.00 - what are others' thoughts?
George

ananda77
07-12-2008, 07:10 PM
RED ALERT: GOLD BACKWARDATION!!!
Antal E. Fekete
Gold Standard University Live
http://www.professorfekete.com/articles%5CAEFRedAlert.pdf

Kind Regards

peat
08-12-2008, 07:25 PM
interesting. hadnt heard of the term backwardation before.

this is relevant

http://www.hardassetsinvestor.com/features-and-interviews/1/1307-gold-in-backwardation-not-so-fast-.html

airedale
08-12-2008, 08:55 PM
Spot gold at $774 right now. Looks like it may be trying to breach $800 again.

Aussie
08-12-2008, 09:34 PM
Spot gold at $774 right now. Looks like it may be trying to breach $800 again.

There's been strong defense of the $780 area the last few sessions . . . hopefully gold can convincingly break that level. Hard to say yet, but maybe USD has peaked. Fundamentals must come back to the fore eventually.

1083

arco
09-12-2008, 10:56 AM
Looks possibly short term bearish on 4H+ TFs.

We've just seen a Bearish Engulf off the Kumo on the 4H , although there could still be a test through that narrow Kumo overhead. Daily is also struggling under the Kumo (Shorter TFs down from 1H are through Kumo).

airedale
09-12-2008, 01:08 PM
Hi arco, I clicked on your gold chart.....it said "click for larger image". But I only got a smaller image. I clicked on that and the image got smaller again.:confused: I stopped then, in case it all disappeared:o.
On reflection last night I should have said that POG will " test" $800, rather than breach $800.

arco
09-12-2008, 02:27 PM
Hi Airedale

Yes, its annoying.....I've PM'd Vince to ask if he can rectify that problem. On the same forum 'shell' (other forums) it enlarges OK when you 'click to enlarge' - so it should just be a matter of tweaking the software.

rgds - arco

Aussie
09-12-2008, 08:37 PM
"Resource Investor's Gene Arensberg discloses tonight that the commercial short positions in gold and silver have gotten even more concentrated in the last reporting period. Three banks or less are responsible for 67 percent of the commercial short position in gold, while one or two banks are responsible for 99 percent of the commercial short position in silver. This data is from the U.S. Commodity Futures Trading Commission itself -- the agency that recently wrote to gold and silver investors, asking them to produce any evidence of market manipulation. As silver market analyst Ted Butler and others have remarked, all the CFTC has to do in regard to market manipulation is explain its own data."

http://www.resourceinvestor.com/pebble.asp?relid=48524

shasta
09-12-2008, 08:43 PM
Hi arco, I clicked on your gold chart.....it said "click for larger image". But I only got a smaller image. I clicked on that and the image got smaller again.:confused: I stopped then, in case it all disappeared:o.
On reflection last night I should have said that POG will " test" $800, rather than breach $800.

Another bounce off the $US750.oz levels coming up? :confused:

Aussie
09-12-2008, 09:00 PM
It's the best question CNN has asked in a while . . .

The $7 trillion question
Do expansive federal bailout plans doom Americans to an inflationary future?

By Colin Barr, senior writer
DECEMBER 8, 2008: 12:45 PM ET

NEW YORK (Fortune) -- A billion dollars here, $7 trillion there: How long till Uncle Sam has to cry "uncle?"

For now, frightened investors worldwide continue to gobble up U.S. Treasury bonds, and they aren't much concerned about the impact of all the obligations the U.S. government is taking on to try and head off economic catastrophe.

But the government printing money, lending money to shaky corporations and guaranteeing debt that may never be repaid all could have troubling consequences in the not-too-distant future.

The No. 1 concern: Even if actions taken by the Federal Reserve and the U.S. Treasury succeeds at stabilizing the global financial system, and an economic recovery takes hold, a brutal inflationary spike will be right around the corner.

"Inflation is the 8,000-pound gorilla in the room," said Gary Hager, president of Integrated Wealth Management in New Jersey. "We're sitting in the room with the coffee cups vibrating."

In that environment, long-term interest rates would soar, the value of the U.S. dollar would plummet, policy makers would face a whole new set of challenges.

"Everyone is going to lose something," said Will Hepburn, president and chief investment officer of Hepburn Capital Management in Prescott, Ariz. "The winners will be those who end up losing the least."

Focus on deflation
Even those who have backed the blizzard of emergency spending on the grounds that it's necessary to prevent an economic catastrophe are worried about the size of the tab that will be left to taxpayers.

Hepburn gives federal officials "bonus points" for concocting innovative responses to the credit crunch. The ongoing collapse of U.S. stock market and real estate values, he said, has slashed U.S. household wealth by at least $10 trillion - and those paper losses could go much higher before the swoon ends.

So far, given the eye-popping sums being offered up by government officials, the markets have responded with surprising nonchalance. Yields on Treasury securities have tumbled to historic lows as investors fly to the safety and liquidity of U.S. government bond markets. The dollar has benefited from the move away from risky assets as well, trading at levels last seen earlier this decade.

Hepburn thinks the process of financial institutions and major investors unwinding massive bets may be further along than people believe. But while that could mean less volatility in the markets and a reduced risk of financial calamity, it could also whipsaw people who have moved their money out of stocks and into low-yielding assets like Treasury bonds.

"The capital preservation strategy will work till the recovery sets in," Hepburn said. "But we don't have the resources to pay off all these obligations - so the government's going to have to try to inflate it away."

An inflationary spike may seem unlikely, given that governments around the world are currently doing their best to head off the opposite threat - deflation, with falling price levels that would hamper economic growth by increasing real interest rates. The Bank of England and the European Central Bank slashed interest rates Thursday morning in a bid to bolster economic activity and prevent inflation from turning sharply negative in coming months.

Fast-changing climate
But Hager notes that it was only four months ago that oil cost $100 a barrel more than its recent $47, which shows how quickly market dynamics can change.

What's more, he said, while people are still struggling to figure out the costs tied to starting up and overseeing the government bailouts, no one seems to have put much thought to an equally important endeavor - how the government withdraws the massive support it has offered the markets in the event its efforts start to bear fruit.

While efforts to thaw the credit markets are taking effect slowly, Tom Sowanick, chief investment officer at Clearbrook Financial, sees a risk that they could suddenly become much more effective, leading to a jump in prices and a selloff in the dollar.

"The economy's in a bit of a slingshot," said Sowanick. "We are looking at a high probability of inflation issues ahead."

http://money.cnn.com/2008/12/07/news/economy/bailout.question.fortune/index.htm?postversion=2008120812

Aussie
09-12-2008, 09:54 PM
Nice article. Quite factual for CNN.

http://money.cnn.com/2008/12/08/magazines/fortune/benner_gold.fortune/index.htm

arco
09-12-2008, 10:33 PM
Thanks for the articles Aussie

Good to see you on over on the 'wild' side.

rgds - arco

Mick100
10-12-2008, 07:33 PM
http://streetfire.net/video/GIGA-dump-180-turn_198967.htm (http://streetfire.net/video/GIGA-dump-180-turn_198967.htm)

Aussie
10-12-2008, 07:51 PM
http://streetfire.net/video/GIGA-dump-180-turn_198967.htm (http://streetfire.net/video/GIGA-dump-180-turn_198967.htm)

Wow Mick, that was cool! I was trying to figure whether that was on ice or just dirt?

Mick100
10-12-2008, 08:26 PM
Wow Mick, that was cool! I was trying to figure whether that was on ice or just dirt?

I would say that's on ice aussie - probably somewhere in Canada

Mick100
12-12-2008, 01:48 PM
Why Gold Should Recover Significantly In 2009
http://www.gold-eagle.com/images/clear.gif
Christopher Laird
http://www.gold-eagle.com/images/clear.gif
Here we discuss why gold will recover in 2009, and why gold is resisting the massive deleveraging in all markets better than most anything. Even though gold and the gold stocks especially have taken a hit, we expect them to recover significantly in 09. Here is why.

Overview of credit crisis and efforts to combat it
Well, Now that it's been a year and a half since Bear had its initial problems with those two hedge funds back around June 2007, its time to take stock and look at what happened. It's also time to ask what is happening, and what is going to happen in a year.
I think it's pretty clear, looking at the state of the credit markets that even after the US Fed has pledged up to $8 plus trillion fighting it, and the ECB maybe $5T, and all the other central banks are nationalizing their banks to stem bank runs, that things are definitely not working out. You can either look at the total absence of credit for businesses and individuals, the high credit spreads, zero interbank lending, or how about 533,000 US jobs lost in November alone?
I mean, pretty much every economy in the world is hosed. Or consider the Baltic Dry shipping index, which was at 11,000 only a couple of months ago, and now is like 7 hundred something. Meaning that world shipping is literally at a standstill. Without listing 50 pages in bullet form, of every collapsing economic sector, we pause here and ask what is going on overall?
Central banks trying everything but are failing
First of all, it's clear that the central banks have done practically everything they can think up to stem the collapsing economies and get lending going. and it is not happening. Pretty much every nation fears a world depression now, and they are doing anything possible to stop that from happening, and that is not working either. There are going to be millions of jobs lost in every major economy in 09, and this has already started in later 08. The fiscal deficits in every major economy are going to be huge in 09
Since the central banks and world treasuries are trying to stop the markets from deflating, and it's not working, then why are they all keeping up that effort? Surely they know that they will not succeed and are not succeeding. All that is happening is that they are massively increasing their public debts. They are using taxpayer money to bail out everything they can. It's a disaster, and rapidly doubling the national debts of the US, and others including the EU nations.
In fact, I was pondering the US debt increases alone. If you only look at the treasury and like bond indebtedness of the US, starting around July of 07 it was around $9 trillion. Now, in a mere year and a half, the US has added another $8 plus trillion to it with all the various bailout mechanisms. These numbers are added up in an LA Times article last week.
So, the US accumulates $9 trillion of national debt in 240 years, and in a mere year and a half, adds another $ 8 trillion? And for what? The credit markets are still frozen solid.
So, since the Fed and ECB and other central banks cannot be blind, why are they continuing to do more bailouts? All that is happening is they are rapidly heading their treasuries to bankruptcy….if they keep going, which appears to be the case.
Credit Crisis III
And, why are they doing this? In not a long time, the currencies themselves are going to start to be threatened, not just devalued. I suppose if they permit a world cascade of competitive devaluations, they can keep the money flooding out for another year before everything explodes into Credit Crisis III, which would be currency crises after the financial/bank crises.
And, since they seem to be going headlong into that path, saying they have no alternative, then what's next for currencies in 09?
First, if you look overall at what has happened, it's massive world deleveraging and debt deflation driving it. As we mentioned before, over $1000 trillion of leveraged markets are unwinding, and if you add up all the central bank efforts to loosen credit markets and do bank bailouts, it adds up to roughly 15 to 20 $trillion.
Well, $20 trillion is not near enough to stop $1000 trillion of markets deleveraging. So, the efforts are doomed to fail.
Currencies next
Once markets realize this, speculators are going to start attacking currencies. They already are in some cases, such as the Ruble, Won, etc. Even the Swiss Franc is under pressure, as the Swiss don't have quite a lot of foreign reserves, and the UBS debacle alone is wiping out their reserves with the bailouts, for example.
Korea and Russia both have problems coming due this month. Both of them have to roll over hundreds of $billions worth of short term corporate credit. And the trouble is, that market is collapsing too. So, the only solution so far has been using mainly their foreign reserves, and both their currencies are getting killed.
Lenders of last resort for -everything?
So, to get the overall picture, the world central banks are finding themselves to be lenders of last resort - for everything. And, fundamentally, that cannot work. The central banks cannot replace the economy. The economy has to function, or else all that happens is that CB money just gets thrown into a black hole. Just look at the still frozen credit markets for proof. And that proves that the central banks cannot replace the economy. After a year and a half of this bailout and lender of last resort stuff, corporate and private borrowing is still frozen, and the world economy is rapidly coming to a standstill.
US Treasury market nearing its limits
As we said, things are so bad that the currencies themselves are starting to feel it. What I am wondering is when the USD will really start to reflect this. Other major currencies are having problems, take the British pound for example, the Ruble, the Won and others. When the USD starts to reflect this failing bailout reality, it will start to drop. And the only weapon the US Fed seems to have is to offer more debt, to borrow more, and try to keep infusing $500 billion at a pop. This seems to happen every two weeks or so. And Obama is planning on up to another $1 trillion in fiscal stimulus in early 09. How much can the US Treasury market stand?
At some point, the bond markets will balk at buying the new US debt. Then the USD will suffer tremendously. I think we might see the beginnings of this in 2009.
'If you can get it'
A few years ago, we said that at some point gold and silver would not be available at any price. Basically, if the USD was falling drastically, people would not sell their gold or silver for any price. They would hold onto it. This situation has appeared earlier than I thought.
The USD has not collapsed yet, but if you try to get gold or silver, you can't. If you order it online you are told it's a 2 month wait. And you have to pay upfront. If you go to coin stores they are out and say it's a 2 month wait. Financial writers are saying buy gold, 'if you can get it'.
I think the simple answer for this is that gold and silver are already anticipating the currency crises coming in 09. Nominally, the USD is holding up compared to other currencies, and even strengthening. But, as we said, at some point the bond markets are going to do a thumbs down on new US treasury issuance, and when that starts to happen the USD will severely devalue in a couple of months.
I suspect gold and silver are already anticipating this risk, even though the USD is holding up at the moment because there is such a demand for cash in general (year end settlements, cash hoarding, etc.)
The disconnect between paper gold and bullion gold
The paper gold market is much larger than the usual gold bullion sales yearly. I would estimate the paper metal markets well over 100 times the size of the actual physical market. That is all the futures contracts and the many derivatives between banks and financial institutions compared to the actual bullion sales.
Since everything is deleveraging, the paper markets easily dominate the physical gold market. That explains the low spot prices, which are too low to encourage people sell their physical gold coins or whatever. Same for silver.
As long as deleveraging continues, paper gold prices can remain subdued.
But, interestingly, if you compared the gold price and the general commodity and energy complex, both considered inflation havens, gold has done much better in the last months since June 08. This is likely because gold and silver are the havens in currency crises. Here is a chart comparing the CRB commodity basket index and gold:


http://www.gold-eagle.com/editorials_08/images/laird121108a.gif

Since the world stocks have crashed in the last year, the CRB crashed too, and also oil (The CRB commodity basket index is heavily oil weighted). Gold has not crashed nearly as much, why is that? Basically every market is deleveraging.
Again, the answer is that gold is a central bank reserve asset and is money. Since most currencies are going to have trouble in 09, gold is anticipating that. It has even resisted the massive deleveraging forces in the paper gold market. No other market has resisted deleveraging.
In fact, the US Treasury bond market being so high is an example of deleveraging too, because there is flight to safety in US T bonds and such. In fact, the US just issued something like $30 billion of 4 week Ts at Zero this last week! Talk about a measure of the state of the world economy!
The US 3 month Ts are yielding practically zero too. They show the state of flight to financial safety:


http://www.gold-eagle.com/editorials_08/images/laird121108b.gif

Flight to safety will end up eventually in gold
When/if the confidence in the US treasuries starts to fail, flight to safety money will leave Treasuries and gold will skyrocket as the only remaining haven. At that point the US Treasury bond yields will begin rising with a vengeance.
Other currencies are not alternative havens
The other currencies are all going to weaken along with the USD with every central bank in the world desperately trying to stop deleveraging as all world markets collapse. This rules them out as alternative havens to the USD. This has already started in earnest in Oct 08 (actual economic collapse after credit collapse for a year and a half since Oct 07). The next question is when does the USD finally turn south, and T bond yields reverse falling. Again, if the other currencies are ruled out as havens, the only haven left is precious metals. People don't trust banks, US T bonds and maybe German Bunds are havens now but won't be later.
Energy and general commodities
It's doubtful that energy will be a haven like gold. Opec for example is having trouble keeping production limited, and falling oil prices encourage cheating. Russia too needs oil revenue, and energy generates something like 2/3 of their foreign exchange. So Russia will also resist production cuts and oil will stay lower in 09 because of that. A rapidly slowing world economy and layoffs are not going to help oil either.
World economy is hammering commodities
In case you doubt that oil will stay down, consider what this chart of the Baltic Dry shipping index shows about the world economy now:


http://www.gold-eagle.com/editorials_08/images/laird121108c.gif

In case you think oil is going to recover a lot in 2009, maybe you better consider what the BDI is saying-- meaning demand for shipping containers collapsed in the second half of 2008, which means the world economy is falling apart rapidly now. That will definitely put ongoing pressure on oil and commodity prices in 2009.
Gold stocks
Of course in all the deleveraging in stock markets, gold stocks took a big hit. But, as the prices of gold recover in 09, gold stocks should also recover, or even exceed their previous highs in 08. I know it's hard to take the gold stock volatility.
I am not saying this because I'm a blind gold bug. I say gold and gold stocks will recover in 2009 because the world is entering a phase of serious and widespread currency instability. That is going to be the next big story in 09. And, since other markets are not likely havens, such as energy or basic commodities, gold is the only remaining haven. After the US T bond market starts to fall (being a major haven now) then gold will skyrocket. Where else can one find a liquid haven except gold? And remember, gold is a Central bank reserve asset worldwide.
I would also like to point out that we warned subscribers of a general commodity sell off in April 08, because we called a USD bottom then. That has sure borne out as we anticipated. We expect the USD to start to turn in 09, probably by one year or so after it began its upturn. Gold and gold stocks will benefit immensely.
The Prudent Squirrel newsletter is our financial and gold commentary. Subscribers get 44 newsletters a year on Sundays, and also mid week email alerts as needed. The alerts include quick notification of important financial news developments by email. Subscribers tell us that the alerts alone are worth subscribing for.
I had one potential subscriber ask me if the newsletter has much more content than these public articles, ie, if it was worth subscribing. The answer is that the public articles have less than 10% of our research and conclusions that subscribers see, not to mention the subscriber email alerts of important breaking financial news. We have anticipated many significant market moves in the last year, such as imminent drops in world stock markets within days of them happening, and big swings in the gold markets within days of them occurring. We have also made a number of good calls on big currency swings, such as with the USD, the Euro and the Yen.
We invite you to stop by and have a look.


December 11, 2008
Copyright 2008
Christopher Laird
Editor in Chief
www.PrudentSquirrel.com (http://www.prudentsquirrel.com/)
Disclaimer: Chris Laird is not an investment advisor/professional. This article, and the PrudentSquirrel newsletter and alerts, are general market commentary only. They are not intended as specific advice. You should talk to your own investment professionals for specific advice. Information here is deemed reliable but should be verified by you if you think it's important.

AMR
12-12-2008, 03:18 PM
The US dollar index is forming an all too familiar pattern. This is certainly a result of wreckless monetary policy turning deflation in to a potential stagflationary situation. At this point we recommend purchasing commodities (DYY is a good ETF because it is 2x leveraged and well diversified) and other currencies while there are reasonably priced opportunities. We like the Euro (http://finance.yahoo.com/q/bc?s=EURUSD=X) and Yen (http://finance.yahoo.com/q/bc?s=FXY) for this trade.

http://mootrades.com/wp-content/uploads/2008/12/usd.png

US dollar index shows head and shoulders pattern


The courageous may consider purchasing commodities stocks as they will likely participate, but the future of the equities market is not necessarily certain as the recession is deepening. Today’s unemployment claims were higher than the expected 525k at 573k. That is a very bad sign that the worst is far from over in terms of how many layoffs we can expect.

Dr_Who
14-12-2008, 04:48 PM
Mick, great article... thanks.

Aussie
15-12-2008, 10:45 PM
Gold This Week.
December 12th, 2008
The Privateer

For no discernible (or announced) reason, the US Federal Reserve recently announced that the last meeting of their Federal Open Market Committee (FOMC) would be streched from a scheduled one-day to a two-day meeting. Originally scheduled for December 16, the meeting is now to take place over December 15-16 with the decision on interest rates to be given on December 16.

Of course, this is the FOMC meeting at which the Fed is universally expected to announce the lowest target Federal Funds Rate in their 95-year history. The current rate is 1.00 percent. For over a month, the Fed has been expected to cut that rate in half to 0.50 percent on December 16. More recently, as the data on the real US economy has steadily worsened, a slowly growing chorus has begun for an even bigger cut. On December 11, futures contracts on the Chicago Board of Trade showed an 84 percent chance that the Fed will actually lower by 0.75 percent to a target Fed Funds Rate of 0.25 percent at the December 15-16 meeting.

Whatever the rate cut, be it 0.50 percent or 0.75 percent, it is clear that the last FOMC meeting of 2008 will also be the Fed's last chance to produce a "headline" rate cut. In 2009, there will no longer be any room for any more big Fed cuts. There is certainly no room for interest rates to fall at the shorter end of the US Treasury's yield curve. This week, rates on three-month Treasury paper actually dipped into NEGATIVE territory. On top of that, the Treasury sold $US 27 Billion in three-month bills this week at a discount rate of 0.005 percent. That is the lowest rate since the US Treasury began debt auctions in 1929. "Investors" are, in effect, paying the US Treasury to retreat into the "safety" of its debt paper.

This situation cannot last for long, and the grotesqueness of it is starting to have effects. The US Dollar dived this week as the trade weighted USDX index fell sharply. As recently as November 21, the USDX closed on a spot future basis at 88.41. This was the highest such close on the index since mid April 2006. Two trading days later, the USDX had slumped to 85.06. Then came the recovery, with the USDX spot future close climbing back to 87.16 by December 3. But this week, the USDX has tumbled again. The major damage was done on December 11 when the yield on three-month Treasury paper went "negative" for the first time ever. By December 12, the USDX had fallen to 83.63, its lowest level since October 20.

1095

Much more important, the USDX has now traced out a series of lower highs and lower lows since its 88.41 peak three weeks ago. This is a STRONG indication that the huge US Dollar rally which began back in July, fuelled by US capital repatriation and even more by global debt deleveraging, is over.

The current issue of The Privateer (Number 618 - Published on December 7) includes in the "chart files" a point and figure chart of the USDX up to the close of trading on Friday, December 5. Here is that chart.

Here is the same chart a week later to the close of trading on December 12. Please note that the trading range we laid out on the December 5 chart has now been decisively penetrated - to the DOWNSIDE!

Combine record lows on Treasury debt yields across the curve - the short end now actually having dipped into NEGATIVE territory - with a SERIOUS fall on the US Dollar trade-weighted index. What you have is an exceedingly dangerous situation which could collapse very quickly. In this context, a "collapse" would mean a rapidly falling US Dollar and rapidly RISING US Treasury debt yields. In the current financial and monetary situation, no more potentially "toxic" mixture exists.

Gold has reflected this situation. Last week (December 1 - 5), the $US Gold price fell $US 64.00. This week, (December 8-12), Gold has risen $US 68.30 - and that is after a fall of $US 6.10 on the spot futures market on December 12. More on this in the commentary accompanying the $US 5 x 5 Gold chart below.

Consider the fact that the only thing which "saved" US (and world) stock markets this week was the US Treasury stepping into the breach to temporarily fund the "big three" US auto makers after the Senate baulked at the $US 34 Billion bailout package they were expected to grant. Consider further that despite the crash dive in US consumer spending, the November US trade deficit actually ROSE month on month. Consider in particular the third quarter 2008 borrowing figures for the various sectors in the US economy released on December 11. US mortgage borrowing fell at a 2.4 percent pace after having fallen by 0.1 percent rate in the previous quarter. Total US household borrowing fell by 0.8 percent after having risen by 0.6 percent in the second quarter. State and local government borrowing rose by 2.9 percent.

But US FEDERAL government borrowing surged at a 39 percent pace in the third quarter of 2008 - SIX times its rate for the previous three months! That is totally unsustainable. Even to maintain that level of borrowing in coming "quarters" is all but impossible. To increase it at the pace at which federal government borrowing rose in the third quarter would quickly lead to a "Weimar" or "Zimbabwe" episode of hyperinflation with certain currency distruction at the end of it.

Next week, the Fed will make the last of their significant rate cuts, leaving no more room below. US Treasury yields are at the lowest point in their history while at the same time US federal government borrowing is accelerating at a pace never before approached. The US Dollar has fallen below the bottom of its recent trading range. In US Dollar terms, Gold has risen by 9.1 percent this week.

What happens after December 16? The monetary "authorities" at the US Fed and the Treasury will have to resort to "alternative measures", not only to continue their attempt to "unfreeze" the credit markets, but to merely continue to fund the US government itself. Any move in this direction will put added pressure on the US Dollar. It will also make the present non-existent US Treasury yield curve look transparently absurd and almost guarantee a HUGE jump in yields. The only question is when.

The potential for a HUGE jump in Gold given this situation is obvious. Does "safety" reside in the world's reserve currency (the US Dollar) or in the debt paper of the government which issues that reserve currency? Clearly not. That being the case, it must reside in the alternative to ALL paper moneys based upon debt. And that's Gold. Always has been, probably always will be.

Permission hereby given to
quote short excerpts - provided
full attribution is given:
© 2008 - The Privateer
http://www.the-privateer.com
capt@the-privateer.com
(reproduced with permission)

Aussie
17-12-2008, 08:49 AM
USD on the way down again . . . gold up US$25 over night.


1098

srowe
17-12-2008, 12:23 PM
Its very interesting to see that although gold has surghed in us$,it has actually gone down in Kiwi dollars from 1530 to 1478$kiwi oz. Its a complicated game for us kiwis
Gold could go to 1500oz but if the us$ drops enough we could end up getting less kiwi $ if and when we sell!

peat
17-12-2008, 01:54 PM
although gold has surghed in us$,it has actually gone down in Kiwi dollars

yes I noticed this for silver as well.

JBmurc
17-12-2008, 02:16 PM
Comex concentration hints that shorts are all government now
Submitted by cpowell on Wed, 2008-12-17 00:17. Section: Daily Dispatches
7:14p ET Tuesday, December 16, 2008

Dear Friend of GATA and Gold:

Fear of deflation lately has been convulsing world markets, causing liquidation of most assets into dollar cash and government bonds. Unchecked, that sort of thing must lead to the cessation of all industrial and agricultural production, and everybody freezes and starves.

Having triggered the deflationary collapse by stomping on the commodity markets a little too hard a few months ago, central banks now have desperately reversed their policies and are striving to revive prices by devaluing their currencies and inflating debt away with the "helicopter money" Federal Reserve Chairman Ben Bernanke long had promised to unleash.

Central banks have used gold in currency devaluation to avert deflation before, and the growing concentration -- near monopolization -- of the commercial short positions in gold and silver on the New York Commodities Exchange may be a clue that such a scheme is under way again. This growing concentration hints that the gold carry trade is over and that the gold and silver short positions are now almost completely in the hands of the U.S. government through its agent, JPMorganChase, and that the cost of the gold price manipulation -- what appears to be a controlled retreat with gold -- now can be borne entirely by the government with some of the magic money being contrived into existence.

The higher the gold price goes, the less real metal the government will have to produce on the Comex and the more the gold side of the reflationary policy can be sustained with magic money -- and, perhaps, the more suspicions of market manipulation will subside. But not, of course, with any help from GATA.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

Aussie
17-12-2008, 09:11 PM
Its very interesting to see that although gold has surghed in us$,it has actually gone down in Kiwi dollars from 1530 to 1478$kiwi oz. Its a complicated game for us kiwis
Gold could go to 1500oz but if the us$ drops enough we could end up getting less kiwi $ if and when we sell!

srowe, that may well be true over the immediate short term but I very much doubt it over the long term. Gold is not something you trade. It's something you hold as the core position in your portfolio. At all times and in all situations for last 5,000 years it IS and has ALWAYS been money.

Gold had been rising in all currencies except YEN and USD. However, soon enough in my opinion, it will be rising in ALL currencies as all central banks are drastically lowering interest rates, expanding their money supplies and inflating their economies in race to the bottom of the interest rate scale.

Debt created money CANNOT replace real capital created from savings.

I can guarantee you that central banks can create as much paper money as they want and as we have seen all over the world today - they can even guarantee the saving of depositors; however what they cannot guarantee is the future value of that money and what it will be worth and what it will buy in the future.

Edit: Physical gold (and silver) is almost impossible to acquire in 1 oz coin form at the moment. More than a month ago, the Perth Mint stopped taking orders until the new year . . . physical prices for gold and silver are far about the Comex price. Look on Trade Me and E-Bay. Expect to pay a huge premium IF you can find it. IMVHO, gold (and silver) over the next three to four years will be moving to a price that people today would simply not believe.

ananda77
18-12-2008, 07:22 AM
Its very interesting to see that although gold has surghed in us$,it has actually gone down in Kiwi dollars from 1530 to 1478$kiwi oz. Its a complicated game for us kiwis
Gold could go to 1500oz but if the us$ drops enough we could end up getting less kiwi $ if and when we sell!

...that is correct for now; therefore, it was a prudent move to buy gold in $US when the US/NZ exchange rate was ~82; then you would not have the problem you have now...

...however, in the current climate of 'US nuclear monetary policy options', it is most likely that we will see a worldwide debasement of paper trash taking a ride to the dumb along with the US$

Kind Regards

Aussie
18-12-2008, 07:49 PM
Richard Russell last night:

Now as the Bernanke-Paulson team open the monetary flood-gates in their desperate effort to halt deflation and bring back inflation. Our creditors (i.e. China) must be getting nervous, and they're beginning to let us know about it. The problem for our creditors -- the dollar is now fading rapidly. There's one obvious way to make the dollar more attractive -- higher interest rates. The choice now -- rising rates or a declining dollar. What I'm most worried about is the US dollar losing reserve status. This would mean that our creditors would refuse to take in more fiat Federal Reserve notes, "money" that we can print as we want.

Gold -- I believe that big money, institutional money, is finally beginning to "get it" about gold. Bonds are in trouble, muni bonds are getting hit, the dollar is in trouble, real estate is getting killed, the world is swimming in debt, and we're facing a monster "margin call" on all debt. Where can you find wealth that is not anchored in debt? Only one place -- gold.

Many people, and not just wealthy people, are thinking in terms of survival. How do you survive in a world that won't lend, in a world where nobody trusts anyone else, in a world, where every asset class is in danger? Only one place -- eternal wealth -- gold. This is the concept that has alluded the public and the wealthy as well. It took a situation (as now) where ALL asset classes are in danger before the smartest people on the planet finally "got it." The "last man standing is gold." When the world's asset classes are crumbling, only gold is left.

You can see it in gold's action. While almost all other assets are sinking, gold on a year-over year basis is up 5.6%. So far, this year, gold is up .01%. Nothing else can match gold's performance. Talk about superior relative strength, you're seeing it in gold.

Gold stocks are common stocks. Up to now, gold shares have acted like typical common stocks -- they've been declining with the Dow and the S&P. I've been saying that once bullion starts moving higher on a steady basis, the beaten down gold shares will start acting like entities that produce gold, rather than ordinary mining stocks that sink with the general stock market.

ananda77
19-12-2008, 10:46 PM
-Backwardation in gold causes, and is caused by, the cascading contraction of world trade. It is preposterous to suggest that no special event triggered the backwardation in gold last November. The special event was the onset of Great Depression II, just as sabotaging the gold standard by Britain on September 1, 1931, heralded the onset of Great Depression I.

Backward Thinking on Backwardation

Posted Thursday, 18 December 2008 GoldSeek.com
Copyright © 2008
http://news.goldseek.com/GoldSeek/1229620000.php

by Antal E. Fekete

Kind Regards

Aussie
20-12-2008, 04:01 PM
Great article ananda77. Keep posting 'em. :D

This is another . . . I think it was Henry Ford in the 1930's who once famously said "If the American people knew how their banking system really worked, there would be revolution before dawn . . . ".

Once you read this hard hitting article by Jim Willie you will see the old man's wisdom. Even back then he knew that Wall St., the Fed and the US Treasury were to become a criminal nexus that was all about serving themselves, not the people who's trust they have been given.

A must read . . .

http://www.financialsense.com/fsu/editorials/willie/2008/1216.html

Also, if you want to know what's going to happen in 2009 . . . think about what happened in 2008 and multiply it. This US 60 Minutes story on the coming next stage of the mortgage meltdown will shock you.

http://www.youtube.com/watch?v=iUuROWEMjm0

ananda77
22-12-2008, 06:14 PM
...after 'Backward Thinking On Backwardation', now this:

-What we are witnessing is a transition that deprives gold of its monetary qualities. Gold in hiding cannot and will not act as money. More to the point, absent gold, nothing else can or will. The disappearance of money, that can be trusted, fatally undermines the legal system, the sanctity of contracts, habeas corpus, any and all provisions of law and order that we take for granted. Under these conditions nobody can operate a gold mine, nobody can run a gold refinery, nobody can guarantee segregated gold deposits, and nobody can prevent the institutionalized theft of ETF holdings. Welcome to the Madoff economy! (See References below: Paul Krugman's column in The New York Times). Jail one Madoff, two others will jump into his shoes.

As a consequence of the permanent backwardation in gold, we shall have a world gone Madoff.-


FORWARD THINKING ON BACKWARDATION
Antal E. Fekete
Gold Standard University Live
http://www.gold-eagle.com/gold_digest_08/fekete122008.html

...Aussie, you may have to re-think your bullishness on gold stocks...

Kind Regards

Aussie
23-12-2008, 06:20 PM
...Aussie, you may have to re-think your bullishness on gold stocks...

We'll see . . . in my opinion there is no question that gold is clearly reasserting itself as money - rather than being "just a another commodity".

Gold is likely to be the ONLY asset class that has made ANY gains this year. Personally, I think it will EXPLODE across '09, '10 and '11. If it was just another commodity as many financial "advisors" seem to think, it would be down 40%-50% like copper, aluminum, zinc etc. In USD dollar terms it has held it's ground remarkably. In AUD and NZD terms it's gains have been spectacular . . . or more accurately, the devaluation of our paper currencies has been spectacular.

The way I see it, the investment world is just one step away from the tip of the inverted apex on the debt pyramid. Every other asset class has been compromised by counter party risk including US TREASURY BONDS and the USD because the US Government is broke and there is NOTHING standing behind it. The financial world will soon come to that collective understanding.

1105

I'm trying to think of another share-market sector that could be making big profits and paying dividends hand over fist in the near future other than PM stocks . . . and I can't.

If it gets to a total breakdown of law and order, worrying about my share portfolio will take a back seat to survival. Physical gold and silver have been money for over 5,000 years, I don't see that changing anytime soon.

In the meantime here's a more likely scenario that is IMMEDIATELY ahead of us. Bill Holter writes for Le Metropole Cafe and I see that other main stream commentators such as Australia's - "The Privateer" aka: Bill Buckler concur.


Mission Impossible

The Fed and Treasury have now entered the zone of impossibility, by this I am saying that anyone with second grade math or enough sense to look both ways before crossing the street knows that what is, can't be. The Fed has lowered rates to zero while the Treasury is in the process of borrowing every last cent, peso, and crumb of capital left on earth. The global marketplace so far has gone along with this farce. Think about it, the Fed says rates are zero % so the Treasury can borrow for free.

Digging a little deeper it gets even more hilarious, you see, the Treasury has already announced plans to borrow $ trillions and they will pay you back with the same Dollars that you lent them, only they will be worth much less or probably even be worthless.. Well, actually not the same Dollars because between now and when the debt comes due the Fed will have created many $ trillions more of new Dollars so you'll surely get new Dollars with fresh ink. The point is this, if you run scared with the herd into Treasuries for their perceived safety, you are actually moving into the riskiest asset on the planet. I am amazed at how many "smart, veteran, Ivy League degreed" boneheads are all buying into this "safety trade" hook, line, and sinker. They have gotten hooked on a fallacy and are standing in line for Treasuries like they actually have a scarcity value, and SINK they will.

So the "safety trade" is this, you buy Treasuries because you are afraid, and 3 months, a year, or 30 years from now you just want to make sure you get your original Dollars back, you don't care about getting interest or more Dollars because they are so valuable to you today. What about tomorrow? The Fed is exploding their balance sheet and goosing money supply like never before, they have told us that they will use "quantitative easing" to get inflation bubbling again, and what, investors don't believe them? I for one have always been skeptical of government announcements but I think that this time they are surely telling the truth. If they say they are intent on creating inflation and destroying the Dollar, BELIEVE THEM because at this point no matter what anyone does, the Dollar is toast.

We are where we are now because 6 months ago it was decided by the Fed and the Treasury that they "needed more time for a miracle". They knew back in the second quarter where all this was going, they new that they would need to borrow unheard of quantities of capital, so they leaned on commodities, probably bought Dollar futures with freshly printed or newly borrowed Dollars and got the "deflation trade" started. Don't get me wrong, we absolutely have deflation because of the amount of imploding and disappearing debt, BUT with a fiat currency that has no backing whatsoever, NEVER in a bazillion years could that currency become more valuable under any circumstances. It was all an illusion, nothing more, nothing less. All they had to do was get the story started in the pits and by the media, use a small amount of capital and leverage it up through the futures market and PRESTO, commodity crash, Dollar rally, and guess what,..... ZERO PERCENT interest rates as declared by the Fed and unbelievably confirmed and highly sought after by institutions.

When history looks back at the current travesty, no one, and I mean NO ONE, will believe that this 0% interest rate scenario could have actually happened. There are probably less than 10 people on earth that could be convinced individually that the worlds' worst credit could be allowed to pay the worlds' lowest interest rates for virtually unlimited quantities, but, spread the lie and make the rounds and pretty soon almost everyone loses their mind. People will be shocked very shortly when this deflation trade blows up, they certainly shouldn't be, but they will. We are now exiting the biggest mania, biggest bubble, the biggest fraud the world has ever seen. It will end with the bankruptcy of the US Treasury!

The world is lending gobs and gobs of capital at 0% to "guarantee principal repayment" in a currency that has been in a confirmed bear market for 6-7 years now. This will not stand, very shortly you will begin to see hiccups in the Treasury market, it will start slowly at first and then gain speed as more and more foreigners begin to repatriate their capital. This will lead to weak and then weaker auctions until one day the Treasury has a failed auction.

They may not publish it as a failed auction and may even falsify "bids", it won't matter because the big money will know who was present and who wasn't. This is the when the moment of truth occurs, the Treasury will have only one buyer remaining for their debt, the Fed. The entire fiat experiment on a global basis will be over, they tried to accomplish "mission impossible" and took the global capital markets down with them.

When investors take 10 seconds to think this through they will all end up with the same conclusion. If they are so scared that they will accept 0 % interest for a year, or 5 years, or whatever, just to preserve their capital, they will now all strive for "the best currency".

This next event will be the biggest bubble in history, far bigger than the current US Treasury farce. The next bubble will be petrified global capital with nowhere to go and no place to hide, except into the Gold market. "There is not enough Gold in the world for people to buy" is the argument against Gold as a reserve currency. I say, yes you are right at today's current prices, imagine trying to fit Niagara Falls through a garden hose? It can't be done right? Well, it depends on the size of the hose. The only way this would be possible is to increase the size of the hose 1000's of times. The only way the Gold market will be able to accommodate the capital coming its way will be to "revalue", this revaluation will occur alongside the default of the US Treasury and Federal Reserve. In fact, the coming revaluation will be awe inspiring as the Dollar approaches "0", real assets will mathematically approach infinity.

Let me leave you with this thought, if investors are so scared that they "won't get their money back" and are willing to invest in Dollars at 0 %, why not invest in eating utensils, pencils, or even gravel? Spoons, knives, and forks have an actual use, they require more labor and capital to produce than Dollars, and they won't shrink. Dollars are guaranteed to shrink, the gov't has told us as much, and this time I for one am inclined to believe them.

Regards, Bill H….

peat
26-12-2008, 07:22 PM
theres quite a perfect Gartley on the daily on Gold
X= 932 early Oct
D (Sell) = 873
Current price 850.
IPO (Target) = 777

Aussie
27-12-2008, 10:08 AM
"I'm less concerned about the return ON my investment than the return OF my investment"

MARK TWAIN

Good advice in times like this . . .

Gold up $25 this morning to $870. . . that "barbarous relic" looks like it will likely finish the year with yet another positive another gain over 2007 - that's nine years in a row. And I'm pretty sure it will be the only asset class to show a $US gain and a big gain in AUD and NZD. People who are concerned about gold's lack of income really don't get it.

Anyone in the US who held gold this year will have protected their wealth and achieved a small gain.

Anyone in Australia or NZ who held gold would have protected their wealth against a big currency devaluation.

1111

Note the USD nominal high back in Mar equated to about AU$1,080, yet as the AUD was crushed in Oct, the price in AUD hit about $1,370.00 - the gain would be similar in NZD.

In 2009, as the global financial crisis really deepens, I believe the authorities who are "governing" it's paper price on the COMEX will lose control and gold will begin rising in all currencies.

Anyone who doubts that the gold price is manipulated needs to open their eyes and do some research. The manipulation of the gold market by the US Fed and Treasury through their surrogate banks JP Morgan and Goldman Sachs is one of the principal reasons for the global mess. This long-term manipulation has allowed US interest rates to stay far lower and the dollar to stay far higher, far longer (decades) than they otherwise would have in a free market.

http://www.gata.org/node/wallstreetjournal

This has been good for an overspending US government and economy but has created an enormous surplus of dollars - aka as "hot money" which in turn creates economic bubbles and distortions throughout the global economy because the USD is universally held and traded as the world's "Reserve Currency". It will not be able to maintain this status for too much longer.

In addition, the price manipulation has intentionally broken the economic thermometer which has always been gold . . . so that investors now see gold as more risky than dead investments like US Treasuries.

Boy, is there a future shock coming for anyone who thinks that the debt of the US Government is a safe place to be.

arco
27-12-2008, 11:20 AM
theres quite a perfect Gartley on the daily on Gold
X= 932 early Oct
D (Sell) = 873
Current price 850.
IPO (Target) = 777

Nicely spotted Peat and there is also a not so perfect mini Gartley shape on the 4 hour. All this is occurring at the resistance of the current downtrend line.

So if these patterns play out, (gold being unable break the DT line), the price could certainly ease back and possible form a bullish Gartley/bat/BF with X at 5/12 or 12/12.

Aussie
01-01-2009, 12:48 PM
Marc Faber on CNBC . . . buy GOLD for 2009!

http://www.cnbc.com/id/28418476

arco
02-01-2009, 10:40 AM
Heres the chart showing potential downside in the near term as mentioned recently

Weekly chart appears interesting with Kumo looking resistant, and Chikou
finding it hard to penetrate the prior PA.

Clearer chart here
http://www.aussiestockforums.com/forums/attachment.php?attachmentid=26840&d=1230849201

rgds - arco

Aussie
02-01-2009, 10:43 AM
Interesting chart . . .

1128

arco
02-01-2009, 10:47 AM
Scaled down to 1Hour

(http://www.aussiestockforums.com/forums/attachment.php?attachmentid=26841&d=1230849807)

arco
02-01-2009, 10:50 AM
Interesting chart . . .

1128

Aussie

Have you converted that to NZD to see if theres much difference?

peat
02-01-2009, 12:14 PM
arco
I think those charts only show if someone has (and logs onto) a login to the aussie stock forums.... they are showing for me only now that I went there and logged in.

Aussie
02-01-2009, 12:17 PM
arco , here's my rough calculation based on buying 1oz of gold at the start of 2008.

Jan 1, 2008.

NZD = .7740 - Gold price is USD $838 or NZ$1,083.

Jan 1, 2009.

NZD = .5826 - Gold price is USD $882 or NZ$1,514.

That equates to a 40% gain in the NZD price of gold. Obviously the big factor here is the devaluation of the NZD. So it would be fair to say that gold has done a mighty job in preserving a kiwi's purchasing power.

Is there ANY asset class in New Zealand that has performed as well? i think not.

However, one may also argue that if the USD was to devalue and the NZD to strengthen again, then in NZD - gold may actually lose some value. But I actually believe that this is unlikely as the YEN carry trade is dead, interest rates are falling globally and broadly speaking, all currencies will devalue together against gold. Just my opinion though.

shasta
02-01-2009, 12:34 PM
[quote=Aussie;238437]arco , here's my rough calculation based on buying 1oz of gold at the start of 2008.

Jan 1, 2008.

NZD = .7740 - Gold price is USD $838 or NZ$1,083.

Jan 1, 2009.

NZD = .5826 - Gold price is USD $882 or NZ$1,514.

That equates to a 40% gain in the NZD price of gold. Obviously the big factor here is the devaluation of the NZD. So it would be fair to say that gold has done a mighty job in preserving a kiwi's purchasing power.

Is there ANY asset class in New Zealand that has performed as well? i think not.

However, one may also argue that if the USD was to devalue and the NZD to strengthen again, then in NZD - gold may actually lose some value. But I actually believe that this is unlikely as the YEN carry trade is dead, interest rates are falling globally and broadly speaking, all currencies will devalue together against gold. Just my opinion though.

~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~* ~*~*

The US economy & dollar won't recover whilst the Feds continue to print money ah la Zimbabwe, they will need some "hard" currency to offset any inflationary effects.

Gold is the one saving grace they have available IMO.

PS, Try buying gold & silver bullion at the moment, not as easy as it was (& btw, Gold/Silver ETF's are buying!).

You'd almost think someone is trying to corner the market...

arco
02-01-2009, 01:55 PM
arco
I think those charts only show if someone has (and logs onto) a login to the aussie stock forums.... they are showing for me only now that I went there and logged in.

Thanks Peat
I hope I have rectified that problem now.

Aussie
02-01-2009, 01:57 PM
. . . Try buying gold & silver bullion at the moment, not as easy as it was (& btw, Gold/Silver ETF's are buying!).

You'd almost think someone is trying to corner the market...

I don't think so. There is a genuine scarcity of supply. People all over the world are scrambling for the physical metal. Small quantities are hard to find and premiums are often US$100+. I haven't checked with the NZ Mint lately but last time I did there was a wait of a few months, same with the Perth Mint. Dealers like Jaggard's in Sydney are very keen to buy as they have customers on wait lists.

In this environment with mine production declining year over year, central banks sales stalled and central banks rapidly increasing the money supply, it's going to take dramatically higher prices to coax gold from private investors onto the market in exchange for de-valuing paper.

Aussie
02-01-2009, 02:36 PM
The US economy & dollar won't recover whilst the Feds continue to print money ah la Zimbabwe, they will need some "hard" currency to offset any inflationary effects.

Gold is the one saving grace they have available IMO.

shasta , maybe not. The US gold reserves have not been audited since the Eisenhower administration in the 1950's.

Have you heard of GATA - The Gold Anti-Trust Action Committee?

http://www.gata.org

This is an ad that GATA ran in the Wall Street Journal on January 31st, 2008 at a cost of US$264,000. This is very serious stuff and GATA is not a lightweight organization. GATA has recently acted as a consultant organization to the Chinese government, the Saudi government and their attendant sovereign wealth funds. GATA has also recently met with the new boss of the US CFTC (Commodities and Futures Trading Commission) in Washington and had the opportunity to present their case directly regarding the obvious gold and silver manipulation on the COMEX exchange. The information was very positively received by the new leadership team.

Over the past decade they have gathered an overwhelming body of evidence that points to gold market manipulation by the US Treasury, the Fed and other central banks in order to manipulate currencies and interest rates by suppressing the gold price.

There is very strong evidence that maybe 1/2 of the US gold reserves have been mobilized into the market over the past 15-20 years to prop up the USD and keep US interest rates artificially low. The US government has consistently refused to have ANY auditing on these reserves, even though they are supposedly a public asset. The practice really gained momentum during the Clinton Administration under the financial leadership of Larry Summers and Sec Robert Rubin - who incidentally (earlier in his career) used to run the London gold desk for Goldman Sachs - so he knows the financial side of gold business backwards.

This makes a lot of sense especially when you consider the massive interest rate derivative positions ($10'sTillions) held by JP Morgan. They were able to write these derivatives with the knowledge that rates were "controlled". If however, the US has trouble attracting the $2 Trillion in borrowings that it will need this year then look for US rates to start rising dramatically and JP Morgan's derivative book to explode! When you start to look at all the pieces individually, you can begin to maybe see how they all fit together . . .

GATA has a couple of lawsuits under way to try and find the truth. If things are as they say and 50% or more of the US gold has been leased to bullion banks like JP Morgan and Goldman Sachs who have in turn sold it into the spot market to finance other trades. . . the chances of it being returned now at current prices are slim to none. It's gone!

If this were to be exposed it would be the biggest scam in financial history.

http://www.gata.org/node/wallstreetjournal

1132

Aussie
03-01-2009, 10:00 AM
Gold Climbs Again - Eight Years in a Row

The numbers for 2008 are in. Gold has done it again. Gold is up for the eighth year in a row against the US dollar. Here are gold's rates of appreciation in terms of several major currencies.

1138

The appreciation gold has achieved over the past eight years is remarkable. Without any doubt, gold's 16.3% average annual change against the US dollar has made it one of the world's best performing asset classes this decade, but oddly, gold continues to be ignored by many. I expect this inattention to change in the year ahead.

The outlook for the US dollar continues to worsen as the Federal Reserve balloons its balance sheet. What's more, the Fed's zero interest rate policy removes any incentive to hold dollars in an environment where counterparty risk remains an intractable problem and where rapid money growth portends a surge in inflation in the weeks and months ahead.

M3, which measures the total quantity of dollars in circulation, grew by about 10% in 2008, near record highs. Two of its components, M2 and M1, increased over the past year by about 10% and 17% respectively. These rates of growth in the quantity of dollar currency are highly inflationary.

Credit continues to contract, and as a consequence is destroying a large amount of wealth as overvalued assets that were buoyed by easy credit are now being marked down in price to realistic levels that more accurately reflects their actual worth. It is important to note, however, that we are measuring the price decline in these overvalued assets with a currency that is being ever-inflated. Though the Consumer Price Index has dropped a little over the past couple of months principally because of the lower crude oil price, the CPI continues to rise on an annualized basis, even by the federal government's own calculations, which understate the true rate of dollar debasement.

More inflation and more dollar debasement can be expected. The Federal Reserve has thrown away the rule book. It is ignoring three hundred years of central bank practices and putting the dollar on an untried path in an attempt to avoid the consequences of the inevitable bust that always follows the boom created by easy credit. The Federal Reserve's grandiose experiment will I expect eventually destroy the dollar, and I don't hold out much hope for any other national currency. To explain why, take a close look again at the above table.

We can see that gold is rising against every national currency. The reason for this phenomenon is that the dollar is the world's reserve currency, and because of this role, it is held as a reserve by central banks around the world. The dollar provides part of the base upon which other currencies are created. Therefore, as the dollar is debased, other national currencies are also being debased along with it. In other words, the US dollar is now going down a 'black-hole', and its gravitational pull is dragging every other currency down with it as evidenced by the rising gold price this decade in all currencies.

There is one other unique aspect apparent in the above table. The average annual rates of appreciation that gold has achieved against the nine currencies in this table is remarkably consistent. Gold appreciated 13.3% to 13.6% on average for eight years in terms of four of the currencies. Gold gained from 10.6% and 10.8% against the two best currencies, the euro and Swiss franc. The euro and the Swiss franc are the 'best' in the sense that less of their purchasing power has been inflated away compared to the other seven currencies. Against the three worst currencies that have lost the most purchasing power from inflation, the US dollar, Indian rupee and British pound, gold appreciated from 16.3% to 17.1%. Then contrast this consistency in gold's average annual rates of change to gold's annual change against these currencies in any year.

Gold's worst annual performance was the -14.9% it lost this past year against the Japanese yen. It's best annual performance was also achieved this year with gold's 44.3% appreciation in terms of the British pound. Here's my point.

Gold shows remarkable consistency when viewed over the long-term. Thus, it is national currencies that are volatile, not gold. Annual changes in gold are a result of currency fluctuations, not anything inherent to gold itself, and this point is proven by the consistency of gold's average annual appreciation this decade, which smoothes out the annual volatility.

We are in a world of freely floating exchange rates where currencies bob up and down relative to one another. But in reality these currencies are not 'floating'. They are actually sinking when compared to gold. The purchasing power of every national currency is being eroded, but this erosion is sometimes difficult to see when currencies are viewed only against each other. But the true picture clearly emerges when all of the world's currencies are compared to gold.

In an environment where the purchasing power of national currencies is being constantly eroded by bad central bank policies, which has been the case throughout this decade, own gold. Importantly, ignore the month-to-month and even the year-to-year fluctuations in the gold price. These fluctuations are not important from a long-term point of view, and in any case occur from factors that cannot be predicted.

For example, who forecast a year ago the extraordinary strength in the yen this year from the unwinding of the carry trade? It nevertheless happened, and consequently, gold declined -14.9% in terms of yen this year even while gold soared against the British pound. But for the past eight years, gold remarkably is up 13.6% on average in yen and 17.3% in British pounds, which is the important point.

Therefore, continue to follow the same strategy that I have been recommending this entire decade. Continue to accumulate gold using a dollar-cost averaging plan. Some months and even some years you will be accumulating gold at a higher price, and at other times a lower price. But over the long-term your consistent accumulation of gold will be averaged in at a good price.

When you accumulate gold this way, you are saving sound money, which is the prudent thing to do in a world where the purchasing power of all national currencies is being eroded by bad central bank policy. The same conclusion is also true for silver, if you are inclined to take the additional risk that comes with silver because it is more volatile than gold.

The following table presents silver's annual rates of appreciation for the same nine major currencies

1137

Silver too has appreciated in terms of each of the above currencies, but its annual changes show much greater volatility than gold. These changes range from -38.8% to 49.3%.

To conclude, gold and silver will probably appreciate in 2009. There is no reason to think otherwise, given the path chosen by central banks in general and the Federal Reserve in particular. After all, who wants to own any national currency when the interest income one can receive is less than the inflation rate? Who wants to own any national currency when counterparty risk makes repayment uncertain? In short, the interest income available today on any national currency does not fully compensate for the risks one takes when holding that currency.

So why lose sleep from worrying about holding national currency and what the Federal Reserve or some other central bank will do to that currency? Own the precious metals instead. But as I repeatedly emphasize, own physical gold and physical silver. Own the real thing, and do not accept paper substitutes.

Published by GoldMoney
Copyright © 2009. All rights reserved.
Edited by James Turk, alert@goldmoney.com

arco
03-01-2009, 02:05 PM
Short term trending/trading possibilities H4 chart

The current move could be an A,B,C correction.

Therefore, we could prepare for a potential reversal pattern in the grey box
which may then form a bullish Gartley, or alternatively keep watching for
a break above current resistance.

newbietrader
05-01-2009, 11:23 AM
Hi all,

Im new in this gold/silver bullion.. and I would like to keep a few physical gold and silver bullion. Where can I get them? Is it cheaper to get from overseas or locally?

From other forum, people recommend http://www.silvertrading.net/.

Thanks
Andrew

peat
05-01-2009, 01:24 PM
newbie trader

check out nzsilver.co.nz - Alec will provide you with silver rounds. I recently got a Austrian Philharmonic 1 oz coin from him

or search for silver or bullion on trademe - not only will you find individuals selling but you will find businesses listing there as well . theres certainly a lot less for sale than there used to be but there is still some.

Acquiring physical metal is a lot more expensive than quoted spot prices so it isnt that suitable for actual trading (as your nick suggests) more appropriate for long term holding.

arco
05-01-2009, 02:04 PM
.


Have I done my calcs correct - those Silver Eagles @ NZ $36.50 are currently nearly double the price of spot (presently 11.58 and falling) :(

I wonder what the buy back price is ?.....makes it expensive both ways, or am I missing something.

Aussie
05-01-2009, 02:06 PM
Hi all,

Im new in this gold/silver bullion.. and I would like to keep a few physical gold and silver bullion. Where can I get them? Is it cheaper to get from overseas or locally?

From other forum, people recommend http://www.silvertrading.net/.

Thanks
Andrew

I have bought several times from Larry LaBorde at Silver Trading in Louisiana. He is highly reputable, will ship overseas and organizes insurance. There is no GST in NZ on gold and silver as long as it is .999 purity.

You can try The New Zealand Mint. Nice people to deal with - only sell Gold Kiwi's - nice coins though.

http://www.newzealandmint.com/

I've also bought from Jaggard's in Sydney. Again, very reputable but they only source Australian Kangaroos from the Perth Mint.

http://www.jaggards.com.au/

If you buy physical metal you must ask yourself "what am I buying it for".

It is not a vehicle to make you rich, gold is most used to preserve your wealth against inflation and currency devaluations as it would have this year when the Kiwi nosedived. It should be the core position of your portfolio and one of the last assets you are likely to sell, unless the global situation changes dramatically for the better - not likely for some time.

Most financial advisors in the past have recommended no more than about a 5% exposure although right now many are saying 20%, with some of the more conservative types saying 50%.

I would beware of ETF's or pooled accounts since they are mere proxies and if TSHTF and you want to take delivery, you likely will not be able to. The real beauty of gold is that it never carries a liability and is always money - just keep it safe.

If you want to trade the gold market - I would not, and certainly NEVER with margin. The COMEX is so manipulated by the big banks that it's almost impossible to trade unless you trade with them, and they have very deep pockets.

If you want to buy gold stocks they are doing very well right now having jumped up 100% or more off their recent lows and many expect them to outperform in '09 and beyond. But nothing is a sure bet.

Cheers and good luck

Aussie
05-01-2009, 02:13 PM
.Have I done my calcs correct - those Silver Eagles @ NZ $36.50 are currently nearly double the price of spot (presently 11.58 and falling) :(

I wonder what the buy back price is ?.....makes it expensive both ways, or am I missing something.

A good baseline is APMEX in the US.

http://www.apmex.com/Category/160/Silver_American_Eagles_Uncirculated_2009__Prior.as px

SAE's are selling for US$3.99 over spot a little cheaper if you buy more. So by my calculations they work out about NZ$27 per coin unshipped.

E-Bay buy now prices are US $17.50 each or about NZ$30.00.

peat
05-01-2009, 03:47 PM
A good baseline is APMEX in the US.

http://www.apmex.com/Category/160/Silver_American_Eagles_Uncirculated_2009__Prior.as px

SAE's are selling for US$3.99 over spot a little cheaper if you buy more. So by my calculations they work out about NZ$27 per coin unshipped.

E-Bay buy now prices are US $17.50 each or about NZ$30.00.


yeh I think by the time you include the original cost and shipping (and probably insurance) you're never going to get much under NZ30 which is what I paid for the Austrian oz. Silver is now almost $20 per oz spot based on Oanda Silver and USD/NZD rates. The kiwi Silver Fern coins sometimes go for under $30 on trademe but not always and not too often.
eg these two are at $28/oz but not closed yet
http://www.trademe.co.nz/Antiques-collectables/Coins/Other/auction-195591700.htm

http://www.trademe.co.nz/Antiques-collectables/Coins/New-Zealand-Decimal/Silver/auction-195682842.htm


heres a nice 10 oz block for similar
http://www.trademe.co.nz/Antiques-collectables/Coins/New-Zealand-Decimal/Other/auction-195873500.htm

newbietrader
05-01-2009, 05:33 PM
Thanks for your points. I will go long for this one.
cheers

arco
05-01-2009, 09:06 PM
Follow up on post #140

Action has reached the Kumo........and contemplating its next move.

Currently +825

.

JBmurc
06-01-2009, 08:55 AM
One thing one must remember when you buy silver/gold bullion is the fact you are converting your NZ dollars(which is one of the worlds smallest most unknown of currency's)
for the world premium longest lasting strongest most respected hard currency's in the world personal I don't mind paying a small premium for the fact.

currently holding 25kilo's of silver bullion average cost $26NZD(have alot in 1oz rounds)

plan on buying at least a kilo/32oz per month going forward as the wages allow

you can currently buy 1kilo bar's off the NZ mint for between $22oz-$24oz which is very good buying at the mo prob one of the best in the world

arco
06-01-2009, 09:20 AM
Follow up on post #140

Action has reached the Kumo........and contemplating its next move.

Currently +825

.

Kumo was pierced and I managed to get +1040 on half
and +2000 on the balance as I slept peacefully unaware.

Watching for the next potential entry off a test of the Kumo (former S=R?)

Dr_Who
06-01-2009, 09:26 AM
Do you guys buy the physical stock or futures?

Whats the best way to get exposure?

lakedaemonian
06-01-2009, 10:29 AM
Do you guys buy the physical stock or futures?

Whats the best way to get exposure?


For me it's a mix between the two.

Physical and paper

I'm a fan of bullionvault.com as I'm not often much of a speculator

peat
06-01-2009, 10:48 AM
Dr Who
I use Oanda for gold or silver trades , and I buy small amounts of physical silver regularly for the long haul.

arco
06-01-2009, 11:40 AM
Do you guys buy the physical stock or futures?

Whats the best way to get exposure?

My stance is similar to that of Peat

Other than Oanda most Metatrader brokers also make a
market in Gold (XAU) and Silver (XAG).

You may also find a few of the more obscure MT brokers have
other metals available to trade. (Plat, Zinc, Copper, etc).

Dr_Who
06-01-2009, 11:55 AM
Whats CMC markets like compare to Oranda and the others?

peat
06-01-2009, 12:45 PM
you can trade gold and silver (and just about everything including two flies walking up a wall :+) ) with CMC but the platform MarketMaker is a pig to use on the computer.... its workable but you need a pretty good computer (which any trader should have anyway) and even then it puts a lot of stress on the machine. I think they reduced their minimum lots on the gold trades a little while back. theres a thread on Market Maker here in the forex forum.

arco
06-01-2009, 12:53 PM
Whats CMC markets like compare to Oranda and the others?

Same as Peat, I found their platform very slow.

Check some reviews here.

http://www.goforex.net/reviews/cmc.htm

or Google for more reviews

JBmurc
06-01-2009, 06:31 PM
GOOD GRIEF, yet another late bombshell in from Dave in Denver...

Subject: Bill, I can't believe this

We accumulated 3 emini contracts on Comex for December delivery and we had been given serial numbers and weights last week for the 3 bars. Today we are informed that Comex, which is now a division of NYSE Liffe, is invoking a rule in which they can deny delivery of individual mini bars (roughly 33 ounces) and issue you only a Warehouse Delivery Receipt (WDR) against your mini-contract unless you have 3 WDR's, and then they'll issue you a 100 oz. bar. Otherwise, if you have only 1 or 2 mini-contracts, you only own a WDR, which you sell by shorting a mini against it. If you own a WDR for a 100 oz., the WDR issuance encourages you to safekeep the gold at the Comex.

CLEARLY, the Comex has run out of the bars that were being delivered to holders of emini contracts. Our back-office guy at RJ O'Brien told us that he's been doing Comex deliveries for 30 years and he's never seen anything like this, and he's never heard of this NYSE Liffe rule on the mini contract. Fortunately we have 3 WDR's and we will be getting delivery of a 100 oz. Comex gold bar.

But this whole episode brings into the question the validity of the Comex gold inventory. Clearly they had so many people taking delivery of mini-bars this year that they ran out of them. Otherwise, there would be no reason to do this. The other point is that, out of nowhere, some obscure rule is invoked and is used to override the terms and conditions of the emini contracts that we purchased over a month ago and fully funded for delivery. More importantly, the Comex is now going to issue WDR's, which are paper claims to gold to those taking delivery of mini-contracts, rather than delivery of physical metal. How long will it be before this happens with the big bars? We have witnessed delivery notices issued for close to 50% of the gold supposedly held in the registered category on the Comex during the month of December, and yet the reported Comex inventory of gold as of 1/2/09 shows almost no physical gold leaving the registered category at the Comex. What is going on? It would appear that they are slowly trying to morph the Comex into a pure paper exchange. Are they becoming a "fractional" reserve depository, where they can issue several WDR's against the same bar of gold/silver, knowing that some of those people will opt to keep storage on Comex? And never require actual physical delivery?

If we had the resources and time, we would absolutely hire a good attorney to look into this and litigate the matter....

we are fortunate to have 3 WDR's - we almost bought a couple mini silvers instead of the 3rd gold. the point is that LAST WEEK we were GIVEN actual serial numbers and weights of the actual bars that were supposed to be delivered to us starting today and now they are not delivering any of them. We will be getting a 100 oz bar, but why would they be doing this unless they are out of mini bars - and what happened to the bars we were told - via the Comex warehouse - that were going to be delivered? So, yes they are refusing delivery in a way. And the other point of highlight is that they may be issuing multiple WDR's against the same bar, expecting that everyone with a WDR will leave the bar at the Comex. I suspect that may have happened here....

It looks like the warehouse delivery receipt is only used for the mini-contracts. However, going over the rules of the NYSE-LIFFE, it looks like a "vault receipt" is issued for delivery against the 100 oz contract. However, if you take delivery of a 100 oz contract and have the Comex safekeep it, what's to prevent the Comex from issuing multiple vault receipts against the same bar? Comex would never run into a delivery problem unless people take actual delivery FROM the Comex.

I am also just informed that our RJ O'Brien guy told us that they had been processing delivery of a lot mini-contract bars until today with our situation. Now Comex is not delivery mini bars. Hmmmm....

Anyone who has gold being safe-kept at the Comex is an idiot. Based on this experience, I would suggest everyone needs to take delivery of their gold FROM the Comex. The best place to keep it if you don't want to hold it at home is First State Depository in Delaware, which is where we have our metal delivered and kept....

Clearly Comex has delivered so many mini bars in the past few months that they no longer have the mini bars to deliver. So in effect, they have defaulted on mini bars, even though there is a NYSE LIFFE rule that let's them out of the default.

Default on the big bars is next.

shasta
06-01-2009, 06:38 PM
GOOD GRIEF, yet another late bombshell in from Dave in Denver...

Subject: Bill, I can't believe this

We accumulated 3 emini contracts on Comex for December delivery and we had been given serial numbers and weights last week for the 3 bars. Today we are informed that Comex, which is now a division of NYSE Liffe, is invoking a rule in which they can deny delivery of individual mini bars (roughly 33 ounces) and issue you only a Warehouse Delivery Receipt (WDR) against your mini-contract unless you have 3 WDR's, and then they'll issue you a 100 oz. bar. Otherwise, if you have only 1 or 2 mini-contracts, you only own a WDR, which you sell by shorting a mini against it. If you own a WDR for a 100 oz., the WDR issuance encourages you to safekeep the gold at the Comex.

CLEARLY, the Comex has run out of the bars that were being delivered to holders of emini contracts. Our back-office guy at RJ O'Brien told us that he's been doing Comex deliveries for 30 years and he's never seen anything like this, and he's never heard of this NYSE Liffe rule on the mini contract. Fortunately we have 3 WDR's and we will be getting delivery of a 100 oz. Comex gold bar.

But this whole episode brings into the question the validity of the Comex gold inventory. Clearly they had so many people taking delivery of mini-bars this year that they ran out of them. Otherwise, there would be no reason to do this. The other point is that, out of nowhere, some obscure rule is invoked and is used to override the terms and conditions of the emini contracts that we purchased over a month ago and fully funded for delivery. More importantly, the Comex is now going to issue WDR's, which are paper claims to gold to those taking delivery of mini-contracts, rather than delivery of physical metal. How long will it be before this happens with the big bars? We have witnessed delivery notices issued for close to 50% of the gold supposedly held in the registered category on the Comex during the month of December, and yet the reported Comex inventory of gold as of 1/2/09 shows almost no physical gold leaving the registered category at the Comex. What is going on? It would appear that they are slowly trying to morph the Comex into a pure paper exchange. Are they becoming a "fractional" reserve depository, where they can issue several WDR's against the same bar of gold/silver, knowing that some of those people will opt to keep storage on Comex? And never require actual physical delivery?

If we had the resources and time, we would absolutely hire a good attorney to look into this and litigate the matter....

we are fortunate to have 3 WDR's - we almost bought a couple mini silvers instead of the 3rd gold. the point is that LAST WEEK we were GIVEN actual serial numbers and weights of the actual bars that were supposed to be delivered to us starting today and now they are not delivering any of them. We will be getting a 100 oz bar, but why would they be doing this unless they are out of mini bars - and what happened to the bars we were told - via the Comex warehouse - that were going to be delivered? So, yes they are refusing delivery in a way. And the other point of highlight is that they may be issuing multiple WDR's against the same bar, expecting that everyone with a WDR will leave the bar at the Comex. I suspect that may have happened here....

It looks like the warehouse delivery receipt is only used for the mini-contracts. However, going over the rules of the NYSE-LIFFE, it looks like a "vault receipt" is issued for delivery against the 100 oz contract. However, if you take delivery of a 100 oz contract and have the Comex safekeep it, what's to prevent the Comex from issuing multiple vault receipts against the same bar? Comex would never run into a delivery problem unless people take actual delivery FROM the Comex.

I am also just informed that our RJ O'Brien guy told us that they had been processing delivery of a lot mini-contract bars until today with our situation. Now Comex is not delivery mini bars. Hmmmm....

Anyone who has gold being safe-kept at the Comex is an idiot. Based on this experience, I would suggest everyone needs to take delivery of their gold FROM the Comex. The best place to keep it if you don't want to hold it at home is First State Depository in Delaware, which is where we have our metal delivered and kept....

Clearly Comex has delivered so many mini bars in the past few months that they no longer have the mini bars to deliver. So in effect, they have defaulted on mini bars, even though there is a NYSE LIFFE rule that let's them out of the default.

Default on the big bars is next.

Check the the shorts from "Industry/Commercial Hedgers" for Silver & Gold

http://www.kitco.com/reports/technicalindicators_oct022008.html

http://www.technicalindicators.com/gold.htm

Dr_Who
06-01-2009, 06:38 PM
Does owning a 18ct gold rolex valued at over $60k count for being long on gold? :D

On a serious note.... all these rumours about central banks and dealers running out of the physical gold holdings is interesting. Is it a matter of just rumours or are there substance behind those rumours?

disc: i do have a small collection of watches

JBmurc
06-01-2009, 06:47 PM
On a serious note.... all these rumours about central banks and dealers running out of the physical gold holdings is interesting. Is it a matter of just rumours or are there substance behind those rumours?


Well I don't think we'll going have to wait to long before the rumours become hard facts

If you still don't understand whats happening with the USD/Gold it worth first looking at the history here's a doco on utube
-http://www.youtube.com/watch?v=3bTq6gFeIvU

Aussie
07-01-2009, 07:56 PM
Does owning a 18ct gold rolex valued at over $60k count for being long on gold?

It was interesting to note that Rolex's were very valuable and hot items for trading in Iceland recently as their economy imploded . . . I have a Stainless GMT II that I wear everyday . . . hopefully things won't get that bad in NZ that I'll have to hock it.

Back to gold, I have a mix of physical and mostly Canadian miners.

Craig3215
09-01-2009, 02:33 AM
I thought this was interesting

Have you noticed over the past couple of days that Crude Oil has firmed up off its lows? At the same time, Gold has faltered. What is important to note about this is the fact that the major commodity indexes are due to rebalance their weightings within their respective indexes, as they do annually. This will equate to notable buying and selling of individual commodities, of which is expected to start this week. We came across an article on the web that outlines work done by JP Morgan on the topic. (Source: ft.com/alphaville)
This becomes all the more noteworthy given that these indexes underly different commodity ETF's and ETN's that are now quite popular for asset allocation decisions. JP Morgan estimates that the DJ-AIG Commodity Index [DJAIG] has $25 billion in related funds tracking it, while the S&P Goldman Sachs Commodity Index [GNX/Y] has roughly $50 billion tied to it. The new weightings will take effect during the roll period in January, staring on the 8th and 9th, depending on the index. For example, Crude Oil's market weight in the DJAIG will rise from 9.6% to 13.8%, while Gold's will be dropped from 10.8% to 7.9%. This follows the rebalancing concept of selling what was strong, and buying what was the weakest. The 2008 returns bear this out: Crude Oil fell -55.5%, Gold rose +5.3%.

JP Morgan (and ftalphaville.ft.com) went on to say the following: "In financial terms, we expect the rebalancing to have the greatest impact in gold, COMEX copper, crude oil, and live cattle. We estimate that the rebalancing of the two indices is expected to result in $877 million of selling in gold, $699 million of buying in COMEX copper, $528 million of selling in live cattle, and $523 million of buying in crude oil."

arco
09-01-2009, 08:27 AM
Happy New Year Craig - Nice to see you posting again.

For day traders, there may be a bear Gartley forming on the H1 chart.

rgds -arco

arco
09-01-2009, 09:04 AM
A good baseline is APMEX in the US.

http://www.apmex.com/Category/160/Silver_American_Eagles_Uncirculated_2009__Prior.as px

SAE's are selling for US$3.99 over spot a little cheaper if you buy more. So by my calculations they work out about NZ$27 per coin unshipped.

E-Bay buy now prices are US $17.50 each or about NZ$30.00.

I checked to see if they would ship overseas. Here's their reply


Thank you for your recent inquiry. At this time, due to insurance restrictions, we are unable to ship internationally. We are currently working with different carriers to determine the best fit for our needs. If we are able to find a carrier that fits our needs, notification will be sent out to all account holders. I do apologize for any inconvenience this may cause.

Should you have any questions, or require any further information, please do not hesitate to let me know.
Respectfully
Brandon Stewart
American Precious Metals Exchange
www.APMEX.com

lakedaemonian
09-01-2009, 11:08 AM
I checked to see if they would ship overseas. Here's their reply


Thank you for your recent inquiry. At this time, due to insurance restrictions, we are unable to ship internationally. We are currently working with different carriers to determine the best fit for our needs. If we are able to find a carrier that fits our needs, notification will be sent out to all account holders. I do apologize for any inconvenience this may cause.

Should you have any questions, or require any further information, please do not hesitate to let me know.
Respectfully
Brandon Stewart
American Precious Metals Exchange
www.APMEX.com

I have found it EXTREMELY difficult to purchase physical from the United States. But I have had success with smaller sellers.

Tulving seems to have extremely competitive pricing and when I've inquired in the past about international sales I was told a firm "no".

Then they recently started doing this:

http://www.tulving.com/New%20Pages/overseas_customers.htm

But I'm relucatant to do so for a number of reasons.

I'm finding the purchase of bullion within New Zealand to be more cost competitive against imported bullion than previously....negating much of my rationale for previously doing so.

So physical and bulliondirect for me.....with the odd trade on Oanda.

I just wish bulliondirect would add silver to their lineup...I presume it's part of their longterm plan......but no dice for the time being according to the person who answered my query.....

JBmurc
09-01-2009, 11:53 AM
I rang the NZmint yesterday gold 1oz in stock No silver till at least mid feb

Silver is 77 times cheaper than gold many factors show it shouldn't be more than 10
times

Harder to get without having to pay-up 10%-20% more

I like Gold but for me Silver #1 once investor start to see the facts profits in silver will be large.

Dr_Who
09-01-2009, 12:19 PM
Why is it so hard to get the physical gold?

shasta
09-01-2009, 07:17 PM
Why is it so hard to get the physical gold?

Dr

I posted some links that showed ETF's/commercial hedge funds & the like have stocked up, to cover there shorts in Silver/Gold...

If you cant find tham PM me & i'll send you the links

Like JBMurc i've looked into Silver, in particular 1kg bars & they are hard to get, not to mention pricey...

Means one thing to my mind, silver is due to spike & hard, sometime soon

JBmurc
09-01-2009, 09:26 PM
Why is it so hard to get the physical gold?

well currently you can buy small amounts of GOLD BULLION off the NZmint think the price he quoted was 1oz fern $1550+freight straight away so no worries there different story for Silver atm which IMHO will really get out of control later this year like when Paper bullion holders decide they want to convert to the real deal..then It's going be.. I'm sorry but your going to have to wait for along time we've sold 10x more paper than real silver we have in the stock vaults and because the investment world will be paying more an more like they are right now Mr paper bullion will be the first to miss out ......

Aussie
09-01-2009, 10:38 PM
I checked to see if they would ship overseas. Here's their reply


Thank you for your recent inquiry. At this time, due to insurance restrictions, we are unable to ship internationally. We are currently working with different carriers to determine the best fit for our needs. If we are able to find a carrier that fits our needs, notification will be sent out to all account holders. I do apologize for any inconvenience this may cause.

Should you have any questions, or require any further information, please do not hesitate to let me know.
Respectfully
Brandon Stewart
American Precious Metals Exchange
www.APMEX.com

Sorry Arco, that wasn't meant to be a suggestion for a purchase. I have been down that road as well . . .

I have ordered several times over the past two years from Larry LaBorde at www.silvertrading.net (http://www.silvertrading.net) - he's a class act and sent me my delivery insured via FedEx. I had no issues with GST or NZ Customs, it was very easy.

Another good US source that ships down-under is Gainsville Coins in Florida.

http://www.gainesvillecoins.com

Aussie
09-01-2009, 10:43 PM
Why is it so hard to get the physical gold?

Merrill Lynch says rich turning to gold bars for safety

1160

By Ambrose Evans-Pritchard
The Telegraph, London
Thursday, January 8, 2009

Merrill Lynch has revealed that some of its richest clients are so alarmed by the state of the financial system and signs of political instability around the world that they are now insisting on the purchase of gold bars, shunning derivatives or "paper" proxies.

Gary Dugan, the chief investment officer for the US bank, said there has been a remarkable change in sentiment. "People are genuinely worried about what the world is going to look like in 2009. It is amazing how many clients want physical gold, not ETFs," he said, referring to exchange trade funds listed in London, New York, and other bourses.

"They are so worried they want a portable asset in their house. I never thought I would be getting calls from clients saying they want a box of krugerrands," he said.

Merrill predicted that gold would soon blast through its all time-high of $1,030 an ounce, and would hit $1,150 by June.

The metal should do well whatever happens. If deflation sets in and rocks the economic system it will serve as a safe-haven, but if massive monetary stimulus gains traction and sets off inflation once again it will also come into its own as a store of value. "It's win-win either way," said Mr Dugan.

He added that deflation may prove the greater risk in coming months. "It's very difficult to get the deflation psychology out of the human brain once prices start falling. People stop buying things because they think it will be cheaper if they wait."

Merrill expects global inflation to hover near zero, with rates of minus 1pc in the industrial economies. This means that yields on AAA sovereign bonds now at 3pc will offer a real return of 4pc a year, which is stellar in this grim climate. "Don't start selling your government bonds," Mr Dugan said, dismissing talk of a bond bubble as misguided.

He warned that the eurozone was likely to come under strain this year as slump deepens. "There is going to be friction as governments in the south start talking politically about coming out of the euro.

I don't see the tensions in Greece as a one-off. It is a sign of social strain in countries that have lost competitiveness."

http://www.telegraph.co.uk/finance/financetopics/financialcrisis/4177766/Merrill-Lynch-says-rich-turning-to-gold-bars-for-safety.html

shasta
09-01-2009, 10:57 PM
Merrill Lynch says rich turning to gold bars for safety

1160

By Ambrose Evans-Pritchard
The Telegraph, London
Thursday, January 8, 2009

Merrill Lynch has revealed that some of its richest clients are so alarmed by the state of the financial system and signs of political instability around the world that they are now insisting on the purchase of gold bars, shunning derivatives or "paper" proxies.

Gary Dugan, the chief investment officer for the US bank, said there has been a remarkable change in sentiment. "People are genuinely worried about what the world is going to look like in 2009. It is amazing how many clients want physical gold, not ETFs," he said, referring to exchange trade funds listed in London, New York, and other bourses.

"They are so worried they want a portable asset in their house. I never thought I would be getting calls from clients saying they want a box of krugerrands," he said.

Merrill predicted that gold would soon blast through its all time-high of $1,030 an ounce, and would hit $1,150 by June.

The metal should do well whatever happens. If deflation sets in and rocks the economic system it will serve as a safe-haven, but if massive monetary stimulus gains traction and sets off inflation once again it will also come into its own as a store of value. "It's win-win either way," said Mr Dugan.

He added that deflation may prove the greater risk in coming months. "It's very difficult to get the deflation psychology out of the human brain once prices start falling. People stop buying things because they think it will be cheaper if they wait."

Merrill expects global inflation to hover near zero, with rates of minus 1pc in the industrial economies. This means that yields on AAA sovereign bonds now at 3pc will offer a real return of 4pc a year, which is stellar in this grim climate. "Don't start selling your government bonds," Mr Dugan said, dismissing talk of a bond bubble as misguided.

He warned that the eurozone was likely to come under strain this year as slump deepens. "There is going to be friction as governments in the south start talking politically about coming out of the euro.

I don't see the tensions in Greece as a one-off. It is a sign of social strain in countries that have lost competitiveness."

http://www.telegraph.co.uk/finance/financetopics/financialcrisis/4177766/Merrill-Lynch-says-rich-turning-to-gold-bars-for-safety.html

When i said Gold would be over $US1,000/oz by end of 2009, you can see how it will unfold now surely?

Try buying the physical bullion (Gold/Silver) & tell me the price of them isn't heading north...:rolleyes:

Aussie
09-01-2009, 11:53 PM
I thought this was interesting

Have you noticed over the past couple of days that Crude Oil has firmed up off its lows? At the same time, Gold has faltered. What is important to note about this is the fact that the major commodity indexes are due to rebalance their weightings within their respective indexes, as they do annually.

I wouldn't trust anything that JP Morgan or Goldman says . . . they are the two major banks of the criminal cartel that has controlled the markets for decades.

Together they act as proxies for the US Treasury and Fed in daily market interventions in all major markets. They are also the banks that hold massive, seemingly permanent short positions in gold and silver on the CRIMEX yet amazingly never seem to attract the attention of the CFTC. The US markets have been rigged by these big banks from top to bottom and side to side.

shasta
10-01-2009, 12:42 AM
I wouldn't trust anything that JP Morgan or Goldman says . . . they are the two major banks of the criminal cartel that has controlled the markets for decades.

Together they act as proxies for the US Treasury and Fed in daily market interventions in all major markets. They are also the banks that hold massive, seemingly permanent short positions in gold and silver on the CRIMEX yet amazingly never seem to attract the attention of the CFTC. The US markets have been rigged by these big banks from top to bottom and side to side.

...and what happens when they have to cover there shorts :eek:

JBmurc
10-01-2009, 08:00 AM
...and what happens when they have to cover there shorts :eek:

They'll prob try sell some paper Gold to cover their asses as there's no-way they have the physical,remember these guys have the backing of the Bush US goverment an now -Obama- which was massively supported by the big banks
What I'm hoping is the demand of physical from outside the US will put so much pressure on the fake short selling they'll have to let the price rise

Aussie
10-01-2009, 12:35 PM
...and what happens when they have to cover there shorts :eek:

shasta, from all the info I have gathered, this is the way that I understand it . . .

I don't think they can cover because they are massively naked - they don't really have the gold! Since these short positions are so enormous and held by just two or three banks, you would think any diligent regulatory authority would be vigilant to make sure such positions are real and being managed properly and are not being held for manipulative purposes - which they clearly are.

The easy way for it to be resolved would be for the CFTC to ask the banks for independent audit details or have an inspection of their holdings, but the COMEX is so crooked and the system so bankrupt that it will never happen. It's a self supporting, self reinforcing web of lies and corruption. It cannot be resolved without these major banks losing $100's of billions as the price of gold rises and we know they will not allow that to happen without a huge fight.

The gold suppression scheme is actually one of the root causes of the crisis we face today as it has been (through the early nineties to now) the cornerstone of the US "strong dollar policy", which is to say that it is a policy based on market manipulation and fraud not fundament worth. We can thank Larry Summers and Robert Rubin for this during the Clinton Administration. They have allowed the world's reserve currency to be so horribly mismanaged for the benefit of the policy makers and insiders and to the detriment of the American people, foreign investors and bond holders and now Summers is back in the Obama administration as a "senior advisor", Geithner from the NY fed is running Treasury, Rubin has this morning quit Citi - you know he's going to turn up in the gov't mix somewhere. . . it's all the same players playing the same game. This is compelling evidence that Obama is simply the "new face" of the status quo and ultimately they are ALL working for the same masters of the financial universe . . . who allow them and their "inside" supporters to collectively rort the system and get fabulously rich.

If gold had not been suppressed, interest rates and the money supply in the US would NEVER have been able to reach bubble status and the banks would not have made their $Trillions in the dot com bubble and the real estate bubble with their derivatives and structured "products". In fact, the entire fake financial services industry that is now collapsing would never had grown to such a dangerous size.

By mobilizing the gold reserves of the American people into the market (without their knowledge) and coercing other central banks into 1999's "Washington Accord", they have effectively disconnected the world's financial alarm system by capping gold while making enormous fortunes that have disappeared God knows where and we are now all paying the price - even here in little 'ol NZ.

Now they (the bullion banks) are in real trouble because they cannot re-acquire and return the massive amounts of central bank gold that has been leased to them over the years without driving the price far higher and losing $billions in the process. So the only thing they can do is keep digging that short hole deeper hoping that something will happen to allow them to escape their desperate situation.

The US gold reserves have not been officially audited since the mid 1950's - why is that? If the world was to ever find out that maybe 1/2 of the US's 8,133 tonnes of gold is gone - forever - sold into the market over a period of decades to support an-otherwise insupportable USD, what do you think would happen to the dollar, the credibility of the USA and the entire dollar based financial system? What do you think the American people would do? I shudder to think. Like I've said before, this is as serious as serious gets.

Huge problems are now brewing in the bond market as the US prepares to try and sell an unfathomable amount of debt to a world that is already saturated with American debt and has lost faith in the global dollar system. Think about the arrogance of a government that is not asking, but expecting the world to literally GIVE it money at interest rates that essentially mean FREE, without which (according to them) economic recovery in America will be impossible.

Do we really think the Europeans, Russians, Saudis and Chinese are happy with the way things are at the moment? Do we think they aren't making their own plans right now? Plans that will drastically reduce or eliminate their future financial dependence on America and it's once mighty dollar. This has the potential to produce a very, very dangerous future geo-political situation by a financially cornered USA. Losing it's AAA rating or reserve currency status would be hugely de-stabilizing.

Anyone who invests in longer term US Treasury bonds from now on is virtually flushing their money away. At the very least they will get their principal back in heavily devalued currency receiving a 30 or 40 percent loss for their generosity - at worst they face total loss.

Watch the spreads on the Treasury bond credit default swaps. They are already rising and are higher than those on lot of corporate debt and will likely explode prior to a US default or currency collapse. What a stupid waste of money this is. Are these idiot financial managers really expecting to be made whole by insolvent institutions like AIG for the losses on their "safe" government investment when this event occurs. They will lose twice.

The global interest in gold as an alternative to US gov't debt in a zero interest environment is just starting to gather steam. The gold problem they created is now beginning to really cook them. Once interest rates start rising, as they will have to in order to continue to attract waning capital, the enormous interest rate derivative positions held "off balance sheet" by JP Morgan, Citi and Goldman will explode them all from the inside out. They thought they had interest rates under control, they thought the game was permanently rigged. But it is not. There is much more pain to be endured in the coming 12-36 months. This is why even the herculean reflation efforts of the Fed and Treasury will be seen as miniscule once the $10's and $100's of Trillion in derivatives start to fall.

All I can say is that anyone who has not seriously considered acquiring at least SOME physical gold as part of their portfolio is risking much. Get some while you still can, because (in my opinion) in the not too distant future a loss of confidence in US government debt will create a historic stampede into precious metals that will be so huge that (for the average person) physical gold will simply be . . . unavailable.

arco
10-01-2009, 01:46 PM
World official gold holdings (September 2008) Table

If these facts are still correct US hold 27.3%- worth approximately $241 billion (July 2008)

The IMF gold reserves refers to 3,217 tonnes of gold also held by the International Monetary Fund (http://en.wikipedia.org/wiki/International_Monetary_Fund). It is currently priced at $42 a troy ounce ($1,370/kg) for accounting purposes.

Full table.....................
http://en.wikipedia.org/wiki/Official_gold_reserves

Aussie
10-01-2009, 02:13 PM
World official gold holdings (September 2008) Table

If these facts are still correct US hold 27.3%- worth approximately $241 billion (July 2008)

The IMF gold reserves refers to 3,217 tonnes of gold also held by the International Monetary Fund (http://en.wikipedia.org/wiki/International_Monetary_Fund). It is currently priced at $42 a troy ounce ($1,370/kg) for accounting purposes.

Full table.....................
http://en.wikipedia.org/wiki/Official_gold_reserves

Arco, It's my understanding that the figure for the IMF is subject to some dispute. GATA thinks that gold is being double counted since the IMF's gold may in fact only be a "claim" against the actual gold reserves of it's member nations. This is supported by the fact that IMF gold sales have to be approved by the governments of member nations and the US Congress.

It's interesting to ponder how much debt could be erased from the books of world governments by a large re-valuation of gold. Makes you wonder . . .

ScrappyO
10-01-2009, 03:43 PM
Ive been watching gold over the past 2yrs and have noticed a pattern that whenever trading starts on the New York Nymex that the price of gold rockets up or down...

Example the last few days..
http://www.kitco.com/charts/livegold.html

Aussie
10-01-2009, 05:30 PM
Ive been watching gold over the past 2yrs and have noticed a pattern that whenever trading starts on the New York Nymex that the price of gold rockets up or down...

Example the last few days..
http://www.kitco.com/charts/livegold.html

You're onto it ScrappyO. Sometimes they use the London physical market - whatever it takes to get the job done. visit www.gata.org

airedale
10-01-2009, 07:05 PM
World official gold holdings (September 2008) Table

If these facts are still correct US hold 27.3%- worth approximately $241 billion (July 2008)

The IMF gold reserves refers to 3,217 tonnes of gold also held by the International Monetary Fund (http://en.wikipedia.org/wiki/International_Monetary_Fund). It is currently priced at $42 a troy ounce ($1,370/kg) for accounting purposes.

Full table.....................
http://en.wikipedia.org/wiki/Official_gold_reserves

$US 42 per troy ounce....what a rort...unbelievable!

Aussie
10-01-2009, 11:30 PM
Huge problems are now brewing in the bond market as the US prepares to try and sell an unfathomable amount of debt to a world that is already saturated with American debt and has lost faith in the global dollar system. Think about the arrogance of a government that is not asking, but expecting the world to literally GIVE it money at interest rates that essentially mean FREE, without which (according to them) economic recovery in America will be impossible . . .

http://www.youtube.com/watch?v=oGbuAIuQm84

Dr_Who
11-01-2009, 08:38 AM
If the theory is correct that there is a massive short outstanding position in gold, the question begged to be asked is... who has been buying up and storing all the gold that has been shorted?

Do you guys recommend buying gold stocks to take advantage of this possible gold rise?

dumbass
11-01-2009, 11:51 AM
gold chart from all time high counts best as a corrective move lower.

it doesnt look like a new impulse wave lower but overlapping corrrective waves.

downward channel developing with possibilty of 680 coming into play which may be a good place to look for a reversal.

update from # 58

gold has had a pretty good run up from 680 but im turning neutral now.

has attempted a bear channel breakout and test of 200 ma and failed to breakout

some support around 830 region and if that fails could be a short to lower channel boundary.

ananda77
11-01-2009, 12:57 PM
... the question begged to be asked is... who has been buying up and storing all the gold that has been shorted?

Do you guys recommend buying gold stocks to take advantage of this possible gold rise?

Merrill Lynch says rich turning to gold bars for safety
Merrill Lynch has revealed that some of its richest clients are so alarmed by the state of the financial system and signs of political instability around the world that they are now insisting on the purchase of gold bars, shunning derivatives or "paper" proxies.
http://www.telegraph.co.uk/finance/financetopics/financialcrisis/4177766/Merrill-Lynch-says-rich-turning-to-gold-bars-for-safety.html

...and those TECH people, they just do not get the story until it will be too late...

Kind Regards

Aussie
11-01-2009, 01:48 PM
If the theory is correct that there is a massive short outstanding position in gold, the question begged to be asked is... who has been buying up and storing all the gold that has been shorted?

Do you guys recommend buying gold stocks to take advantage of this possible gold rise?

Dr. respectfully, I think you may have missed the point. What I said in my previous post and what JBmurc also has hinted at, is these banks which are heavily short (principally JP Morgan and Goldman Sachs) don't actually have the gold they say they do. So they are trading short with gold they don't have. This is what is known as "naked short selling" - or a "failure to deliver". It happens all the time with stocks and it is used by all the big banks and brokers to artificially drive down the price of a company so they can then load up on it at a price that is more to their liking. In effect, they create counterfeit stock positions to sell. I know it sound unbelievable.

http://en.wikipedia.org/wiki/Naked_short_selling

It is a horrible practice that under most all circumstances is illegal but the regulatory authorities do nothing about it. This is where you see the corrupt cogs of government through the SEC and the CFTC, intermeshing with the banks at the expense of the shareholders. The goal of this exercise is to exert market making control over the markets to enrich the banks at the expense of ordinary investors and shareholders.

And this is why there is no transparency in the marketplace. There have been no audits of these banks, no audits of the COMEX because they do not want to be exposed. If people only knew how manipulated the US and Canadian markets were they would be revolt.

Anyone who reads this post and is still scratching their head, I highly recommend you download listen to both of Jim Puplavas absolutely incredible interviews with a man named Bud Burrell. They are entitled "The Greatest Crime In History" and "What's Wrong With This Picture".

http://www.financialsense.com/Experts/2008/Burrell.html

It is both a fascinating and frighting look behind the Wall St. curtain with a man who has spent his life as a trader across 40 years and is now actively engaged in helping fight the corruption. After you listen to this, you will understand naked short selling and why corruption in the financial markets is such a huge problem.

As far as gold stocks are concerned, speaking personally first I made sure that I had a solid, core position of physical metal in my possession. I am also invested in several gold mining companies because I believe gold will rise in value, it follows (hopefully) that the mining companies will provide significant leverage to the price of gold because by buying shares in a mining company, you are purchasing a share in their reserves usually at a heavily discounted price. The risk you take is will they be able to bring that gold to market? And believe me, that is not as easy as one might think.

My principal investments are in Canadian miners such as Goldcorp, Agnico-Eagle, Kinross and Yamana. I also have a smaller spread of Jr miners that I believe will do pretty well.

The thing you have to understand about miners is that they are viewed as being pretty risky - but what in the market today is not? Believe me, an iron stomach and emotional strength combined with a reasonable timeline and strong convictions are required to see the rewards in this sector, but I firmly believe those rewards will be spectacular or I would not be taking the risk.

A lot of people have seen some pretty steep losses in the miners since the commodity rout began last July. However the gold miners are starting to come back very strongly, many with gains of 90% to 165% off their recent lows, and they are still screaming buys in my opinion.

But make sure you do you own due diligence and if you decide to invest, I would advise you to stick with the larger producing companies that have good accelerating growth profiles, low production costs, that are located in countries that are politically stable and have a strong financial position. If all these attributes are present then that is a very good signal that it is also well a managed company.

Cheers & Good luck.

shasta
11-01-2009, 02:11 PM
Dr. respectfully, I think you may have missed the point. What I said in my previous post and what JBmurc also has hinted at, is these banks which are heavily short (principally JP Morgan and Goldman Sachs) don't actually have the gold they say they do. So they are trading short with gold they don't have. This is what is known as "naked short selling" - or a "failure to deliver". It happens all the time with stocks and it is used by all the big banks and brokers to artificially drive down the price of a company so they can then load up on it at a price that is more to their liking. In effect, they create counterfeit stock positions to sell. I know it sound unbelievable.

http://en.wikipedia.org/wiki/Naked_short_selling

It is a horrible practice that under most all circumstances is illegal but the regulatory authorities do nothing about it. This is where you see the corrupt cogs of government through the SEC and the CFTC, intermeshing with the banks at the expense of the shareholders. The goal of this exercise is to exert market making control over the markets to enrich the banks at the expense of ordinary investors and shareholders.

And this is why there is no transparency in the marketplace. There have been no audits of these banks, no audits of the COMEX because they do not want to be exposed. If people only knew how manipulated the US and Canadian markets were they would be revolt.

Anyone who reads this post and is still scratching their head, I highly recommend you download listen to both of Jim Puplavas absolutely incredible interviews with a man named Bud Burrell. They are entitled "The Greatest Crime In History" and "What's Wrong With This Picture".

http://www.financialsense.com/Experts/2008/Burrell.html

It is both a fascinating and frighting look behind the Wall St. curtain with a man who has spent his life as a trader across 40 years and is now actively engaged in helping fight the corruption. After you listen to this, you will understand naked short selling and why corruption in the financial markets is such a huge problem.

As far as gold stocks are concerned, speaking personally first I made sure that I had a solid, core position of physical metal in my possession. I am also invested in several gold mining companies because I believe gold will rise in value, it follows (hopefully) that the mining companies will provide significant leverage to the price of gold because by buying shares in a mining company, you are purchasing a share in their reserves usually at a heavily discounted price. The risk you take is will they be able to bring that gold to market? And believe me, that is not as easy as one might think.

My principal investments are in Canadian miners such as Goldcorp, Agnico-Eagle, Kinross and Yamana. I also have a smaller spread of Jr miners that I believe will do pretty well.

The thing you have to understand about miners is that they are viewed as being pretty risky - but what in the market today is not? Believe me, an iron stomach and emotional strength combined with a reasonable timeline and strong convictions are required to see the rewards in this sector, but I firmly believe those rewards will be spectacular or I would not be taking the risk.

A lot of people have seen some pretty steep losses in the miners since the commodity rout began last July. However the gold miners are starting to come back very strongly, many with gains of 90% to 165% off their recent lows, and they are still screaming buys in my opinion.

But make sure you do you own due diligence and if you decide to invest, I would advise you to stick with the larger producing companies that have good accelerating growth profiles, low production costs, that are located in countries that are politically stable and have a strong financial position. If all these attributes are present then that is a very good signal that it is also well a managed company.

Cheers & Good luck.

I'm looking to position myself for the upswing in NEM, a 5m+/oz per year producer & unhedged!


Gold price tipped to soar


Economists around the world are tipping the gold price to soar this year, with the most bullish market-watchers predicting the yellow metal could hit more than $2000 an ounce.

ANZ head of commodities research Mark Pervan says the $2000 price forecast is based on speculation of a collapsing US dollar stemming from a "massive injection of US dollars into the system. People will buy gold as an alternative."

Gold is used as a safe haven in times of weak equity markets, bought as a hedge against inflation and currency markets.

It's one of the few investments that has historically produced strong returns in periods of mounting inflation and interest rates, market turbulence and economic uncertainty as exchange trade funds, listed stocks, managed funds and resource companies plummet in value as inventors or speculators dump holdings.

From a base of US$550 an ounce at the start of 2006, the gold price almost doubled to US$1000 in March last year and is hovering at US$845.

The New Zealand price in the corresponding period went from $950 an ounce to reach a high of $1670 in the last week of last year and is now at $1450 and climbing.

During the past five years, gold has risen more than 210 per cent in value, says Robert Jamieson, general manager of Goldsilverbullion.com.au, an Australian website that allows consumers to buy bullion online. This equates to an average return of 42 per cent per year.

Global demand for physical gold has surged 300 per cent since the banking crisis last September, says the New Zealand Mint's head bullion trader Michael O'Kane.

In the US alone, it climbed 900 per cent on the back of the Bear Stearns collapse.

But a supply shortage is developing as production gets "hammered", O'Kane says.

Less gold is being produced as high oil prices drive escalating mining costs, says Pervan, and no one is releasing gold from central banks.

"Supply is incredibly tight. Consumers just can't get the gold - there's just no physical material for them to buy."

The Perth Mint suspended orders in November amid a heavy run on the precious metal. The Royal Canadian Mint, South African Mint and US Mint also took breaks.
A lot of work goes into making bullion and the timeframe for delivery is getting longer,

O'Kane says. "Two years ago, I took two weeks off during January trading. This year, I have had Christmas and New Year's Day off - it's nuts, and has been since Bear Stearns went sideways."

Dr_Who
12-01-2009, 12:44 PM
This is all very interesting. I will do more research into. I have exposure to Gold with my holding in IRN which has 15 million ounce of gold reserve.

I do understand naked shorts. Even if you naked short, you still have to have a buyer willing to take it. I am interested to see who has been buying up all the gold that the investment banks have been shorting.

Aussie
12-01-2009, 01:03 PM
Even if you naked short, you still have to have a buyer willing to take it. I am interested to see who has been buying up all the gold that the investment banks have been shorting.

Listen to the Bud Burrell interview . . . he explains how the crooked brokers "bounce" and "borrow" these counterfeit shares between each other so they appear to acquiring them legally but they are not - because they don't exist. Also, if you have a margin account, brokers can illegally "borrow" and promise YOUR shares without your knowledge.

Aussie
12-01-2009, 01:05 PM
I posted this is the "if the USD collapses" thread but thought it worth posting here as well for those who may be interested. Bill Buckler is one smart guy and sees things in a uniquely clear and insightful way . . . things are way more out of control than anyone in Washington or Wellington would dare let on . . . and the consequences for our local currency are very uncertain since I don't think the RBNZ has much gold and if the value of US Treasuries goes way south, what is underpinning out local Kiwi currency? Nothing else of value other than our future labour and taxes I guess.


A Future U-Turn In A One Way Street

The Federal Reserve has boxed itself into a corner. With official US rates at (effectively) zero, they have only one way to go in future - UP! As a direct consequence of this, US Treasuries are standing on a trap door. The mad stampede over the past two months into Treasuries for “safety” simply means that these holders of US official debt now stand on that trap door. US Treasuries are the main assets held by the rest of the world’s central banks as reserves behind their own national currencies. US yields are certain to climb as the US Treasury tries to borrow more than $US 2 TRILLION this year. When yields climb, bonds - ALL bonds including US Treasury bonds - fall in value.

US Treasuries are the last bubble, following after stocks, real estate and commodities which have already deflated. When the US Treasury bubble bursts, the carnage on the global bond markets will be awesome.

A Now Invalid US Benchmark

In the staircase of ascending risk, government debt paper - bonds, notes etc. - have long been deemed the safest. Only after government debt comes the debt issued by the private civil economy. It is deemed more risky because this debt is exposed to commercial risks which government debts are not. The problem is that government debt is exposed to political risks.

Today, the climbing political risk of US Treasuries is radiating all around the world. Most of the rest of the world’s other central banks hold in their vaults US Treasury and Agency paper “valued” at $US TRILLIONS. When US Treasuries start their fall, this will contract the valuation of the “reserves” of every global central bank. That will in turn contract their reserves, forcing all their own interest rates upwards. Were the US Dollar fall along with Treasuries (an almost certain event), then many foreign central banks would face a double jeopardy situation. As their holdings if US Treasuries fell in market value because of climbing US interest rates, a falling US Dollar would tear their holdings of official reserves apart. These foreign central banks would have to take desperate measures to replenish their reserves. They would have to do so in public in order to “reassure” the public. Any foreign central bank which failed to do this would risk losing their standing as the backstop for their commercial banking sector. At that point, the US political risk would spike up to a global crisis level since, clearly, US Treasures, Agencies or even the US Dollar itself could no longer be valid reserves. In outline, these are the already built-in monetary and financial features of the global situation which is arriving.

The Looming US Debt Default

As things stand economically, the Obama “stimulus” package is woefully too little and too late. It amounts to throwing money into a US deflationary hurricane. But that same “stimulus” package opens the door politically for the later claim that since the rest of the world refused to lend the money to save the US economy, we will no longer service our external debts to the world. From that comes debt default. But even that is only the start because it then becomes critically necessary to stop an immense outflow of foreign funds presently invested in the US. That means US currency controls. Under such controls, an American who wants to make payments offshore will have to justify their action. Foreigners will have to justify why they should be allowed to take some of the US Dollars they own out of the US. Foreigners outside the US who are today holders of US Dollars will have to explain why they want to send some of their US Dollars back inside the US and what they intend to buy there.

Historically, there is not an item in this which has not been done in the many instances of debt default.

The Likely US Triggers

The most likely global trigger event will be when a US Treasury debt issue is under-subscribed (i.e. an issue is left on the counter because it faces a global buyers’ strike) or when US interest rates start their climb, the US Treasury is forced to offer a higher rate because of international fears of a US debt default. An under-subscription or a higher US Treasury offer rate required to sell new US debt paper are really two sides of the same economic coin. Either or both will signal that the US Treasury has reached its global credit limit and can borrow no more. At that point, the Treasury will stand in the same position as any person receiving a letter in the mail that says their credit card has been totally maxed out.


Permission hereby given to quote short excerpts - provided full attribution is given:
© 2009 - The Privateer
http://www.the-privateer.com (http://www.the-privateer.com)
capt@the-privateer.com
(reproduced with permission)

Aussie
13-01-2009, 01:33 AM
Classic orchestrated move on the gold price right at the NY CRIMEX open . . .

1168

arco
13-01-2009, 08:52 AM
For day traders, there may be a bear Gartley forming on the H1 chart.

rgds -arco

Bear Gartley reached its target - reaching potential area for a turn as
there is an uptrend line just below.

Dr_Who
13-01-2009, 09:24 AM
Bear Gartley reached its target - reaching potential area for a turn as
there is an uptrend line just below.

Please explain what you mean. I am not a chartist, so dont understand the lingo.

I am thinking of buying some gold futures for a trade.

peat
13-01-2009, 10:36 AM
Dr This is what a gartley looks like - see investopedia.com


http://i.investopedia.com/inv/dictionary/terms/AT-AdvancedFib.gif


I identified a bearish one occuring recently on the daily
see post #125
http://www.sharetrader.co.nz/showpost.php?p=237980&postcount=125

targets are not defined in that picture but supposedly if you sell (or buy depending on bullish or bearish version) at the D point then target is approx back to C point
we have a thread here in this forum called Gartley/Butterfly (which is a bit difficult to follow ) probably best just to go to investopedia and read. They do require an understanding of fibonacci levels ie percentage retracements.


In further news ABNAmro today report :


Gold trading enjoyed a bumper year in 2008 as investors
sought a safer place to put their cash as the credit crunch
hit home. The value of gold trading rose 58% to a record
US$20.2 trillion, according to trade body International
Financial Services London. The growth in turnover was
partly due to the rise in gold prices in the early part of the
year. Investors have also been attracted by its appeal as a
relatively safe asset. Gold hit an all-time high of $1,011 per
ounce in March before falling back to end the year at $870.
Silver also fared well as investors warmed to other precious
metals. Trading increased 39% to a record $2.6 trillion

Aussie
13-01-2009, 11:30 AM
Fearing the "Ghost of Gold".

We read today that Robert Rubin, the famous architect of the "strong dollar policy" under Clinton, the self-same billionaire from Goldman Sachs and latterly CitiGroup, has decided to join the new President’s Administration. Now that his fortune (thanks to the U.S. taxpayers, read "the system") is safely tucked away, and now that the realization has hit him that he has been exposed and "found out", he is suddenly contrite saying "My great regret is that I and so many of us who have been involved in this industry for so long did not recognize the serious possibility of the extreme circumstances that the financial system faces today". This man, who has been instrumental in the organized US led Fed/Central Bank/Treasury suppression and fraudulent manipulation of gold and silver for well over ten years, along with a cast of powerful and familiar characters such as Greenspan, Summers, Clinton, Bushes, Bernanke, and Wall St. Brokers, hedge Funds, media, major gold producers, and many others, rest my Lord, is suddenly contrite. The genie has been out of the bottle for too long and the guilty are circling the wagons. But what if "the people" discover they have no gold? That the Gov. vaults, ETFs, COMEX, Treasury, Fed., Banks and other depositories are mostly depleted of gold (the gold that belonged to US populace) due to criminal activities against the taxpayers; against the constitution of the USA?

Robert Rubin has suddenly found "religion" and has seen the errors of his ways. You don’t suppose he smells the fear of retribution in the air do you? Perhaps he has become paranoid and has nightmares of lynch mobs running wild through the halls of power. Does this admission of guilt pardon him suddenly of his myriad sins? Will he be protected behind the veil of the Presidency yet again? I guess there’s nothing like a good offence. Is Obama recognizing Rubin’s culpability and attempting to offer a pardon as an olive branch to the powerful Cartel culprits in order to "bring them onside"? After all, most of the "new gang" aren’t new at all. (Obama has some tough choices to make and he is in a position of serious compromise.) If so, Zebras will soon be changing/painting over their stripes. The people who have ruined the entire economy of the once great USA, to the extent of threatening the total global economy are being offered a chance to save the day. This is beyond bizarre.

The "ghost" of the gold standard is howling louder every day, threatening to destroy the criminals with whipping blue integrity. It threatens to righteously return the power back to the people. It threatens to make the banks honest again. It threatens to protect the savings of individuals from confiscation by way of currency debasement and inflation. It threatens to make banks and governments honest, restore economic health, protection of property rights, and bring balance to capitalism and freedom to mankind. The roars of the golden "ghost" can no longer be denied as they echo into and from every corner of the earth. They reverberate from the street vendors of Mumbai to the Chinese factory worker, from the mini miners in Africa to the artisans of Asia, from the hushed cocktail parties of the wealthy to the surreptitious operations of money launderers, from the hidden crevices of bureaucracy to the highest office in the land, from palaces of the Mid East to the mandarins of the markets, from the paper printers to the conjurers of derivatives, but always and initially from the silence of the deceitful to the honesty of the protagonists (GATA, LeMetropole Cafe). There will be no denial. Indexes can be "rebalanced", derivatives/leverage can stretched, spin can be spun, Gold Bugs can be anointed with more tinfoil hats, naked shorting can be extended, margins can be raised, some miners can continue complicity, and so on. It is all wearing very thin. Gold can not be printed and the purported death of the law of supply has indeed been highly exaggerated. As the spot price of gold becomes higher than the futures price, mints are overwhelmed, Swiss vaults are full to capacity, coin dealers are depleted and public pronouncements of gold buying blast in to the mainstream media….and even the reluctant, gold bug/GATA nemesis Dennis Gartman increases gold holdings in his portfolio, the dye is cast.

With the newly appointed mastermind of dollar hegemony, Robert Rubin, what will be the plan of the old cadre of crooks? Do they dare to step it up a notch and attempt to continue to hide their sins, grabbing ultimate power by the total subjugation of the electorate? Are they desperate and arrogant enough to attempt to win "at all costs" by "whatever it takes"? Will they ignore the ominous warnings of the howling ghost of gold? Or will they save themselves and all of us by giving rebirth to a new global, gold backed currency system? If not, can gold confiscation be far away, along with hyperinflation, protectionism, depression, homeland militia, marshal law, travel restrictions, food rationing and civil unrest?

Only time will tell. We have no way of knowing the inner thoughts of the above self proclaimed, nefarious masters of the dollar universe, especially since the President Obama has just pronounced that torture will no longer be tolerated the by United States of America.

Regards,
Dennis Oliver

Dr_Who
16-01-2009, 02:28 PM
Any chartist on Gold?

Is it time to go long for a trade?

arco
16-01-2009, 03:13 PM
Gold is still in a Broadening Wedge formation

You can read more about that pattern here
http://www.thepatternsite.com/dbw.html

I'd be waiting for a break and test of the DT line.

rgds - arco



..

Aussie
16-01-2009, 04:04 PM
Thanks Arco, some nice upward price action in Asian trading this arvo . . . US dollar down almost a full point on the USDX today, EURO up almost 1% , Kiwi up almost 2%. Tonight's session will be important.

airedale
16-01-2009, 07:19 PM
Right, Aussie, will be interesting to see if the Nymex can stifle POG when it opens in about 6 hours.

Aussie
16-01-2009, 07:33 PM
Right, Aussie, will be interesting to see if the Nymex can stifle POG when it opens in about 6 hours.

You mean the CRIMEX - like they usually do . . . :mad:

A few bullish signs today USDX is down below 84 - I'm hopeful for some positive action. :D

shasta
16-01-2009, 11:34 PM
You mean the CRIMEX - like they usually do . . . :mad:

A few bullish signs today USDX is down below 84 - I'm hopeful for some positive action. :D

Gold, Silver & Copper all up on early trading ;)

Dr_Who
17-01-2009, 07:23 AM
Gold, Silver & Copper all up on early trading ;)

I nearly went long on gold futures yesterday $810, but didnt have the guts. Gold trading at $840 this morning. :confused:

Thanks to all the posters for the info, esp Aussie and ARco. :) Keep the info coming guys. :)

Aussie
17-01-2009, 10:34 AM
. . . Gold trading at $840 this morning . . .

A stellar performance last night Dr. It was an important session, I would not want to see gold move back below $800 lest that stall the next push through $1k.

Hourly Action In Gold From Trader Dan
Posted: Jan 16 2009 By: Dan Norcini Post Edited: January 16, 2009 at 4:00 pm

Gold was the recipient of “reflation” flows as money flowed back into the commodity sector today on news that the remaining $350 billion in the TARP was going to be released. That served to undercut safe haven flows into the dollar and definitely into the bonds, with commodities as a sector generally benefiting. As I wrote the other day, if you don’t like the current investor sentiment, stick around a day or so, it will flip 180 degrees and then do that same thing again a few days after that. Perhaps next week we go back to deflation paranoia. Who knows and who really cares at this point since all that matters in these markets is money flows – nothing else.

From a technical perspective gold bounced exactly where it needed to bounce in order to keep the technical charts from deteriorating. It did however run exactly into overhead resistance in today’s rally where it was summarily capped by the usual crowd. The bulls have dodged a bullet and deserve credit for their performance and grit but they need to force the shorts out of their defense line at $840 to give them a shot at $860. They are attempting to do that even as I write this commentary. Hats off to those fund managers who actually bought into the weakness in gold for a change instead of selling downward momentum.

1177

While it is a bit difficult to see on the 12 hour chart, gold has actually been forming a reverse head and shoulders chart with one shoulder near $750 in early September 2008 and the head near the $700 level in late October and early November. The last shoulder and this is ONLY A POTENTIAL shoulder is the low made yesterday. To confirm this, gold would need to break out above the $880 level in a convincing fashion. That once again serves to underscore the significance of that pesky $880 level. For now, resistance stands at today’s high near $840 followed by stronger resistance between $855- $860. Support remains just above the $800 level.

The mining shares as indicated by the HUI and the XAU bounced off the 50 day moving averages and are now running into resistance near their down-trending 10 day moving averages. The HUI is attempting to climb back above broken support near the 266 level but is encountering difficulty with the broader equity markets sinking back into negative territory. The XAU’s chart is actually better looking than that of the HUI as it managed to climb back above broken support near the 107 level but it too has run into selling in the zone between the falling 10 and 20 day moving averages at today’s session high.

Grains are all strongly higher today with Argentina’s drought news putting a firm bid under the soybean market which is effectively pulling wheat and corn along for the ride. That move in the grains has my attention as they have been tracking closely with gold’s overall performance.

Crude oil is lower today after violating support yesterday near the $35 level which makes the rally in some of the other commodities all the more noteworthy. I do hope that we are reaching the point where these various markets begin to trade on their own set of fundamentals rather than the mindless idiocy we have had to sit through watching index funds and hedge funds spit them all out en masse or buy them all up en masse. Crude needs to get above $40 in the February to have a shot at a bottom being formed.
Bonds had collapsed at one point today when the stock market was moving higher and safe haven flows abruptly reversed but as the equity markets faded and crude moved lower, the bonds began moving well off their lows. Judging from last evening’s Federal Reserve Custodial Accounts data, foreign Central Banks continue to GORGE themselves on US Treasury paper while continuing their exodus from US agency debt. As long as this FCB bank buying of Treasuries continues in such size, it is difficult to see the collapse of the bond market bubble occurring anytime soon. It will collapse however and when it does, the sound will be heard around the world as it will occur very quickly.

The dollar was stymied up between the 86 – 85 level which is the former support region from October and November of last year. Technically it looks like a failure to climb back above the 86 level quickly and the Dollar is headed back to 82 with a possible test of 80 occurring.

Click the link below to enlarge today’s hourly action in Gold in PDF format with commentary from Trader Dan Norcini

http://www.jsmineset.com/wp-content/uploads/2009/01/January1609Gold1230pmcdt.pdf

Aussie
17-01-2009, 10:45 AM
Not even a dead cat bounce for the banks. Yesterday the Dow rallied back some 200 points and the banks could only make the sound of a thud. Citi is breaking up [as if two bankrupts are better than one], Bank [owned by] America needs $20 billion not the $10 they were talking about yesterday and JP Morgan, Wells Fargo and GE are all plumbing new lows. We are at the breaking point and something needs to be done very soon.

I believe the solution will involve a market closure and bank holiday.

Along with these closures will be the famed "force majeur" for the metals markets, this will be mandatory because of JP Morgan's short exposure. I have made the "musical chair" analogy many times in the past, I think we are now VERY close. When the light switch is flipped you will have what you have and movement will be frozen. After however long it takes to "reopen", the worlds' "values" will not be recognizable, huge gaps will have happened while no one could make portfolio changes. The current portfolio manager wisdom is "I will sell or hedge 5 minutes before the bomb hits the ground", I don't think so Tim.

Both the U.S. and Britain are no longer publishing money supply numbers so no one can see how egregious they are with printing more paper. The whole mess stinks from head to toe, the world has turned into one gigantic ENRON! All currencies are fraudulent which makes everything we do and touch also fraudulent by association. Government economic numbers have been bogus, income and asset reporting by corporations has been fraudulent, Ponzi schemes have popped up everywhere, and of course all the way down to individuals, we have seen lying to receive loans. Even the Roman Gods must be blushing at what we are being fed on a daily basis.

When all is said and done, the rush into metals as wealth protection will be unlike any panic ever seen in history. I have become more and more sure of this as each fraudulent event larger than the last has surfaced. The panic into metals will be caused by the "what can I trust mentality". This event is very close, as I believe that when it comes to anything finance, YOU CAN NO LONGER TRUST ANYTHING! I know this sounds a bit paranoid but given everything we have been told and fed for the last 18 months [actually much longer], everything has turned out to be 180 degrees off. When history is written about the current episode, fraud will probably be the most commonly used word. Physical Gold is no fraud, it never has been and is an honest island in middle of the current cesspool. The masses will seek haven!

Regards, Bill Holter
via Le Metropole

arco
19-01-2009, 05:05 PM
Looks like a H&S with the action testing the neckline now.

Now, if it cant break through, the first target could be
somewhere in that circle. The line through the circle is
a possible area of support from old consolidation and
resistances.

......which in turn could create a bull Gartley meaning the action
could then head back to test the bear flag lower line......

Theres another possible H&S, but you might be able to
figure that one out on the lower flag line

.........crystal ball games :)

.

Aussie
19-01-2009, 09:46 PM
Looks like a H&S with the action testing the neckline now . . .

Thanks for the TA Arco.

The Latest US Banking Crisis

"We cannot remember the start of any year since the US Dollar and Gold were divorced in 1971 when more people were more "bullish" on the prospect for Gold over the year to come. It is disquieting, to say the least."

Sure enough. By Thursday, January 15, the spot future price of Gold in New York was down to $US 807.70 - nearly $US 80 below the $US 884.30 level where it had started the year less that two weeks before. Then came the BIG upward bounce on January 16. We have yet to see an instance where an upsurge in publically "bullish" sentiment by mainstream financial analysts towards Gold has not led very quickly to a drop in the Gold price. This one has been no different. What we do not yet know is if Gold has "finished" its correction yet. Sure, the spot future price jumped $US 32.60 on January 16, but don't forget that it began the week with a fall of $US 34.00.

It would seem that as "volatility" calms down to some extent in the paper markets in the lead up to the "changing of the guard" at the White House next week, Gold becomes more volatile.

Next Tuesday, January 20, Mr Obama becomes the President of the United States. This weekend, and it is a long weekend in the US with Monday, January 19 being the Martin Luther King Holiday, the US Treasury is working around the clock once again trying to shore up a banking system which is once again coming apart at the seams.

Meanwhile, financial headlines in the US are becoming more "surreal" by the day. Here's a sample of one, taken at random, reporting on the stock market action on Wall Street on January 16 - Wall Street Rebounds After Banks Report Big Losses.

If your memory stretches back that far, you will remember the halcyon days of the "dot com" bubble at the end of the 1990s when the bigger the loss reported, the higher the stock price went. The difference back then was that none of the "dot coms" were too big to fail, so they all did. If you doubt it, get hold of a ten-year NASDAQ chart and take a look at it. The banks, on the other hand, clearly ARE too big to fail. Hence the "Wall Street rebound". The reasoning goes like this: "Since the banks are too big to fail, the government will continue to bail them out. Since the government will continue to bail them out, they are 'safe'. Government bailouts always work, they HAVE to work, the banks are too big to fail."

What is lost in this little circle of reasoning is a rather important point. The banks in question have ALREADY failed. The proof of this resides in the hundreds of $US Billions which has already been injected into them, in the eradication of official interest rates by the Fed, and in the current frantic activity of the Treasury to set up a "bad bank" which will take over the "illiquid" (read worthless) "assets" from the books of these same banks.

The reason why the commercial banking system in the US and in every other "developed" nation is essential (too big to fail) to the government is the essential services they provide in perpetuating the fiat money system. In any system based on full "faith and credit" - AND NOTHING ELSE - the credit will flow just as long as the faith is maintained. Banks can happily go about their business stockpiling government IOUs as "reserves" and creating new money out of thin air in ever increasing quantities by "crediting" it to their customers' accounts. Mr Bernanke and Mr Paulson are of one mind and one voice in proclaiming at every opportunity that (to qoute Mr Bernanke this week) - "our economic system is critically dependent on the free flow of credit."

This is quite literally true. Mr Bernanke's (and Mr Obama's when he takes office next week) economic system IS critically dependent on the free flow of credit. The days when money was brought into existence by crude coin "clipping" or printing are long gone. Modern money creation methods are almost totally dependent on inducing people to borrow and spend, and the banks are the vital middlemen in this process. The problem for the government is acute when their banking system can no longer perform this vital function. As such a situation worsens, the "responsibility" for borrowing new money into existence falls more and more directly on the government. Hence Mr Bernanke's lowering of official US rates to ZERO last month. Hence the just announced US government budget deficit of $US 485.2 Billion for the first THREE MONTHS of fiscal 2009. Hence the widely rumoured plans that the Fed will start to directly buy US Treasury debt paper (thereby monetising it) as early as next week.

What financial and monetary officials in the US (and almost everywhere else) are in the process of doing is acting to destroy the viability of their "money" in an attempt to rescue their banks - the conduit for getting their "money" into circulation without having to actually "print" it. The end result of their actions will be a destruction of the money as a viable medium of exchange and there is, as yet, nothing on the horizon to suggest they are going to stop.

In such circumstances, those who foresee a "good year for Gold" are certainly doing so on very good grounds indeed. The gyrations in the Gold price this week is just one more indication that the ultimate choice about what to use as money is getting closer. So are the desperate measures now being publically discussed by Treasurers and central bankers everywhere. And next Tuesday, it all lands on Mr Obama's desk.

dumbass
21-01-2009, 09:27 PM
gold shaping up for a short

risk defined at 890 , possibly close to printing wave 2 before wave 3 takes gold much lower.

Aussie
21-01-2009, 10:51 PM
Hourly Action In Gold From Trader Dan
Posted: Jan 20 2009 By: Dan Norcini Post Edited: January 20, 2009 at 6:54 pm

Several noteworthy events occurred today which impacted gold trading in the US. First and most importantly were developments along the currency front. The British Pound was utterly mauled as news came out that the Royal Bank of Scotland had incurred the largest loss in British corporate history. If that was not bad enough, shares of Lloyds Banking Group fell by nearly 50% at one point in today’s trading as the market greeted the Bank of England’s rescue plan for the banks and the economy with a resounding THUD. The fear is that interest rates are falling to near zero and that the British economy is in horrific shape. Investors are also looking at the details of the rescue plan and are voicing concerns as to how this massive increase in debt is ever going to be repaid. Sound familiar?

News of continued downgrades in sovereign nation debt in and around the Eurozone sent the Euro into the toilet as it dropped to its lowest level since early December last year.

Now those of us who have been accustomed to watching the action of gold on a daily basis would have generally expected gold to drop alongside of the Euro especially as the Dollar went on another of its rip-roaring short squeezes amid panic buying. However, something happened related to this currency movement that caused a complete reversal of the norm. Gold in Sterling terms shot to a brand new all time high at the London PM Fix coming in at 612.307 while Gold priced in Euro terms came in at 661.383 coming in just shy of its all time high PM Fix of 663.352 made back in October of last year. Gold traders in New York looked over at that and decided that they needed to get out if they were short or get in if they were out! In other words, what looks to be a genuine flight to the safety of gold has begun in Europe. And why not? With US Treasuries paying next to nothing and several European nation government bonds being downgraded, where else can those who are fearful of what is occurring go with their life’s savings? If I were a bond holder and looked ahead at the plethora of new debt being issued, supply of such magnitude that the numbers send the mind reeling, I would seriously doubt that demand would be able to keep up with it.

What we are seeing is gold trading as a currency – something that has repeatedly been echoed at this site now for years especially in the face of repeated deflationist claims that gold would sink alongside of the rest of the commodity world. Keep this important fact in mind. Gold is a currency; it is only a commodity when there is general trust in paper money. Any fears or concerns about the stability or trustworthiness of any fiat currency will send money scurrying into gold. It is now evident that is occurring in Europe. It WILL OCCUR here in the US at some point in the not too distant future.

The second noteworthy item affecting gold was the price action in the expiring February crude oil contract. After dropping to a new yearly low, it rebounded sharply taking out the previous day’s highs as shorts began covering and bottom pickers began moving in. One day does not a trend make but I am keeping a very close eye on this market as crude oil, whether we like it or not, has become a sort of barometer for the rest of the commodity complex as a whole. Higher crude prices would only serve to bring in additional buying support into the gold market.

Technically gold blasted through two overhead resistance areas with seemingly little to no opposition. The first one at $840 was gone without gold breaking a sweat; the latter zone near $860 also was breached as buy stop momentum carried prices through it sending the shorts reeling before bullion bank selling came in and managed to suck up all the bids and drop it back below this level. The inability of gold to close strongly above the $860 level reinforces it as a significant barrier with $880 still lurking above that as the opposition to a move to the $1000 level. Support lies now at $840 and then below that near the $820 level.

The mining shares, as indicated by the HUI and the XAU, showed a very strong disconnect from the broader US equity markets which went one way (down) while they went the other (up). Both indices have recaptured the 10 and 20 day moving averages after a perfect bounce off of the 50 day moving average last week. This is quite bullish action with the next barrier to both indices their former double tops make back in late December and early January of this year. Expect to see shorts try to hold the line there for if they fail, a trending action will be highly likely.

It is difficult for me to see where the buying came from that pushed the Dollar higher seeing that Treasuries were hit hard while equities were also taken down sharply. If anyone was busy running into the US Dollar as a safe haven play, I sure did not see it.

Bonds are weaker today after getting hit hard overnight but seem to be holding above the session low with continuing weakness in equities supportive.

Click link below to enlarge today’s hourly action in Gold in PDF format with commentary from Trader Dan Norcini.

http://www.jsmineset.com/wp-content/uploads/2009/01/January2009Gold1230pmcdt.pdf

Aussie
21-01-2009, 10:59 PM
gold shaping up for a short risk defined at 890 , possibly close to printing wave 2 before wave 3 takes gold much lower.

I dunno dumbass. You can count all the waves you want but I think people (especially in the UK right now) are losing faith in the banking system, that means they are wanting to hold REAL MONEY . . . have you seen the results for the big banks during the first 20 days of 2009? Looks like the banks are taking their final dying breath. How long before the rush to the exits starts in the US?

Bank of America -77%
Wells Fargo Bank -60%
Citigroup -39%
JP Morgan -58%
Barclays -42%
Deutsche Bank -52%

This is on top of last years MASSIVE loss of market cap.

We are getting closer to a total collapse of the financial system.

Got gold?

peat
22-01-2009, 07:01 AM
the bearish gartley that i identified some time ago isnt performing as I might expect - but the fat lady hasnt finished the song yet either....


Gold hits NZ$ record prices reported in the Herald today

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10552951

dumbass
22-01-2009, 05:49 PM
I dunno dumbass. You can count all the waves you want but I think people (especially in the UK right now) are losing faith in the banking system, that means they are wanting to hold REAL MONEY . . . have you seen the results for the big banks during the first 20 days of 2009? Looks like the banks are taking their final dying breath. How long before the rush to the exits starts in the US?

Bank of America -77%
Wells Fargo Bank -60%
Citigroup -39%
JP Morgan -58%
Barclays -42%
Deutsche Bank -52%

This is on top of last years MASSIVE loss of market cap.

We are getting closer to a total collapse of the financial system.

Got gold?

i think our time frames may be some what different , im only interested in technical set ups for a trade maybe running a few weeks ,rather than your bigger picture fundemental observations.

i still feel if the banking system can hang on for another few weeks i may make some money on a short with a clearly defined risk.

but there's always an alternative count !

Aussie
22-01-2009, 07:14 PM
i think our time frames may be some what different , im only interested in technical set ups for a trade maybe running a few weeks ,rather than your bigger picture fundemental observations.

i still feel if the banking system can hang on for another few weeks i may make some money on a short with a clearly defined risk.

but there's always an alternative count !

I hear you dumbass, you are a brave man. Good luck with the trading :D

Aussie
22-01-2009, 07:20 PM
Am I wrong here? Seems like a sustained pop above $860 or a spike above $880 would signal a definite breakout . . .

Tonight's London session should be very, very interesting :)

1195

Aussie
22-01-2009, 08:43 PM
$859.50 . . . . Ping!

1197

Almost predictable . . .

shasta
22-01-2009, 08:48 PM
$859.50 . . . . Ping!

1197

Almost predictable . . .

Approx $A1,300/oz wow :eek:

Aussie
22-01-2009, 09:01 PM
$859.25 . . . Peeooow!

1198

Do we think there are people in London and NY right now who are intent on making gold "Behave" . . . I think YES!

Hopefully gold can overcome their pricing "boom". This is a case study in gold cartel manipulation.

shasta
22-01-2009, 09:06 PM
$859.25 . . . Peeooow!

1198

Do we think there are people in London and NY right now who are intent on making gold "Behave" . . . I think YES!

Hopefully gold can overcome their pricing "boom". This is a case study in gold cartel manipulation.

Bit earlier to say that just yet, Gold has had a few attempts on breaking out without doing do...

Question is, for how much longer?

Aussie
22-01-2009, 10:46 PM
shasta, seems to me that gold started selling off sharply a good hour before the dollar started to turn up and the Euro started to turn down. Classic signs of a gold price attack by the bullion banks. It'll be interesting to see the final results of the session but I believe that from a banking and confidence perspective, gold needs to be controlled - tonight! Look for the CRIMEX to up the ante when it opens in a couple of hours.

I'd be very happy to be wrong here, but these counter intuitive moves have become so obvious.

airedale
23-01-2009, 10:28 AM
[quote=Aussie;240762]Am I wrong here? Seems like a sustained pop above $860 or a spike above $880 would signal a definite breakout . . .

Tonight's London session should be very, very interesting :)

Hi Aus, a close above $880 would be a strong signal, or may even be the breakout that we are waiting for.

Aussie
23-01-2009, 10:29 AM
Quite a battle last night. Look at that 860 line. 3 days in a row of relentless defense. Gold clearly wants to move higher but is being deliberately capped. Anyone who does not believe that the gold price is "managed" needs to open their eyes and do some investigating. 860 is a deep line in the sand for the gold cartel. Every rally was met with selling action. This tells me that gold is at a critical juncture. A pop above and it should be propelled into the 900's, a breakdown from here will slow things down . . . there is a lot of positive price pressure if the bulls can push it through. Let's hope.

1200

Aussie
23-01-2009, 11:20 AM
Hourly Action In Gold From Trader Dan
Posted: Jan 22 2009 By: Dan Norcini Post Edited: January 22, 2009 at 3:41 pm

The British Pound continues its horrid decline falling to a 23 year low against the US Dollar as events in Britain are rapidly spiraling out of control. The monetary authorities’ plan to rescue the banks there has been met with skepticism by investors while a genuine, and I might add, well-founded, fear of just who it is that is supposedly going to buy all this debt that the government is issuing which is blowing the fiscal budget deficit to kingdom come. We have a combination of a government spending itself into the drink while its stagnating economy produces fewer tax receipts. This point has not been lost on gold which once again today made yet another all time record high in terms of sterling.

One has to look at what is happening to the Pound with a great deal of sadness. Consider the once mighty British Pound, also called Sterling because it was at one time as good as silver, was the global reserve currency when Britannia ruled the seas. Its decline, which is completely due to its feckless political leaders who like ours here cannot seem to restrain spending their citizenry’s money and that of those not yet even born, is a frightening harbinger of what greets the US Dollar should we continue on our current course. From what I can see regarding the new Administration’s policies, coupled with a Congress completely taken over by those who are salivating at spending upwards of another $1 trillion, the US Dollar is doomed to follow the same course of Sterling. To say that it was inevitable is to allow those responsible to escape the blame. All of it was completely avoidable but it would have required statesmen who had the long term interests of the nation’s monetary future in mind rather than gutless politicians who lacked the courage to do what was right for the LONG TERM, even if it cost them their seats in the halls of power because of the hardship that it would inflict in the SHORT TERM.

“I will make mere lads their princes and capricious children will rule over them”. (Isaiah 3:4)

There is increasing chatter coming out of the Forex arena of intervention possibilities by both the Swiss monetary authorities and those of Japan. Both the Swissie and the Yen have been the beneficiaries of carry trade unwinding made possible because of ultra low interest rates in those respective nations. As hedge funds shed risk due to the deteriorating global economic news, these trades are being reversed or unwound with the result that players have been forced to buy Swiss Francs and Japanese Yen to repay the loans that were borrowed in terms of those currencies which were then used to purchase securities denominated in other currencies that paid a higher yield. It was a money making ATM machine while it lasted. The result has been to push both of these currencies strongly higher at the very same time that monetary authorities all around the globe are wanting to see their currencies weaken in an effort to maintain their export-related business. I am not sure how much damage the Swiss could inflict on the specs in regards to the Franc but I am under no illusions whatsoever when I say that the Bank of Japan is not to be trifled with should they decide to come from their lairs and punish the spec longs in the Yen. “Been there, done that,” is my motto and that has come from getting taken out to the woodshed by these guys once too often. So far, it is just rumors but only a fool would ignore it.

The Euro is struggling with those sovereign debt downgrades of Greece, Spain and now Portugal. That continues to feed the move to gold which is occurring in Europe as today the gold price in Euro terms hit a new all time record at the London PM Fix coming in at €663.376.

The Dollar is going to have its own issues to deal with as investors who were stuffing themselves full of US Treasuries recently are now disgorging them at an alarming rate. Today’s catalyst for the bond sell off was comments by the Obama Administration’s Treasury Secretary designee, Timothy Geithner, who accused the Chinese of manipulating their currency. Note to Geithner – you do not accuse your biggest creditor of doing the things that your own government has been doing and expect them to continue using their savings to buy your too-numerous-to-number debt issuances.

IF you have not taken a look at the long bond chart, do yourself a favor and see what happens when supply overwhelms demand. Bonds have now broken down below their 50 day moving average and appear headed down to the 100 day unless they can reverse course very quickly. The weekly chart shows a solid topping formation in place with the next level of support near 125^12. The bonds have been very tricky to call because anyone with a lick of sense knows that they were in a bubble but gauging when exactly a bubble has popped is sometimes a bit more difficult than it would seem mainly because it is easy to underestimate the effect produced by fear on a market. Markets are anything but rational – do not ever forget that.
I should also point out that the Gold/Bond ratio, a measure of investor’s preference for a safe haven choice, has been decidedly in favor of gold over the last couple of weeks. I will attempt to get an updated chart up later today for your reference. No doubt serious-minded investors are looking at the Treasury International Capital Flows data as well as the coming US government spending orgy alongside of these Euro zone debt downgrades and are saying to themselves, “the Hell with paper”.

Meanwhile, Russia appears to be burning through its share of reserves with the speed of a wildfire as they attempt to put a floor beneath the disappearing ruble. I will get a Gold in ruble terms chart up today later on – it too is amazing.

This brings me to another point – I see one way only for those nations which are cranking up the printing presses to warp speed to avoid complete and utter insolvency – they will have to devalue their currencies against gold and inflate the debt away. I am not a statistician or a mathematician, but I cannot wrap my mind around the amount of debt being created by so many nations and envision any other scenario in which any of it has a snowball’s chance in hell of ever getting repaid. Either that or the current monetary system collapses and a new Bretton Woods type accord replaces it. When we talk about a soaring gold price we are in effect talking about the devaluation of paper currencies – it is one and the same thing for all practical purposes.

All of this is serving to put a strong floor of support beneath the gold market which’s resiliency is beginning to resemble that of a cork’s. It keeps bobbing up to the surface after getting pushed down by bullion bank selling at the Comex.

The wedge formation which is revealed on the daily gold chart that begins with the July 2008 high and the mid-October 2008 low appears to be attempting to resolve itself in favor of the upside with the top of that line coming in near the $880 region. That level is taking on more and more significance as a technical barrier and should gold be able to punch through the selling that the bullion banks are throwing into its path here near the $860 level, they will be pushed back to that line as a defense. If they can be pushed off of that hill, gold will have broken out in US Dollar terms into a trending move. Expect a battle at that level therefore by the gold haters. Momentum indicators on the daily gold chart are all positive with the price above all of the major moving averages. The only bit of a fly in the ointment is that the 10 day moving average remains below the 20 day but it has turned higher which is a plus. The last reaction in gold a few trading sessions ago took it down into the confluence of the 50 day and 100 day moving average from which is sharply bounced, a very strong technical signal.

Equities are falling apart with news from Microsoft about job layoffs hitting stocks hard. After all, if the darling Tech Sector cannot even escape the carnage, what can? Quick answer – check out the mining sector which again is putting in a valiant effort to divorce itself from the broader equity market action. The HUI and the XAU are both in positive territory as I write this. Whether they can hold onto their slim gains is unclear at this point in the session but the fact that they are remaining afloat even with a lead anchor tied to their feet is at least somewhat encouraging. I might add that should the HUI be able to clear the 288 level, it has a good shot at 305-310. The XAU has short term resistance near the 120 level and if it can best that should go on to test 125-127. Momentum indicators on the daily charts of both indices look positive but if we get a move higher, I would want to see the RSI get above the 75 level.

Gold deliveries in the expiring January contract reached 161,700 ounces with today’s assignments while registered warehouse stocks have actually shown a decline below the 2.8 million ounce mark (Someone needs to the call the Comex guys and have them reign in that fellow who reported the drawdown – what was he possibly thinking?).

After bouncing yesterday, crude oil bounced back down today. To a certain extent, its welfare is tied to that of the equity markets where as a general rule, lower stock prices have been sucking it lower while higher prices have been encouraging bottom pickers. Anytime we see weakness in crude oil, many of the other commodity markets do tend to soften as this plays into the deflationist camp’s views which still have a wide following out there. For the sake of clarity, I do not agree with the view of those in that camp who predict gold getting pulled lower as a result of deflation. My reason is that their view fails to see gold as a currency and not a commodity. That is the reason I continue to send charts up from time to time detailing the price of gold measured in other currencies besides the US Dollar. The deflationists are narrow-minded in their view of gold considering it only in US Dollar terms. How one can say that the price of gold is going to weaken because of a deflationary environment while at the exact same time the yellow metal is soaring into new all time high in terms of the British Pound, the Ruble, the Euro, the Australian Dollar, the Canadian Dollar and so on? It seems to me many of the proponents of this view have some serious “splaining” to do. Hint – gold is a currency guys – stop looking at it like it was a commodity.
Lastly – trading volume and open interest in the February 2009 contract will be waning as April will take on most active month status.

http://jsmineset.com/index.php/2009/01/22/hourly-action-in-gold-from-trader-dan-51/

arco
23-01-2009, 01:30 PM
By TINA LAW - The Press | Friday, 23 January 2009International investors keen to get their hands on New Zealand gold are helping push the price of the precious metal to record highs.
The price of gold sold in New Zealand reached NZ$1745 an ounce on Wednesday, which was also influenced by a drop in the New Zealand dollar. Gold fell slightly yesterday and was trading around $1735 an ounce.


http://www.stuff.co.nz/4826904a13.html

Aussie
23-01-2009, 04:31 PM
Looks like gold is setting up for a re-match tonight. Looks like it'll be another late night . . . :D

1203

peat
23-01-2009, 05:25 PM
whats your trading strategy aussie?

Aussie
23-01-2009, 09:36 PM
whats your trading strategy aussie?

Peat, I'm not a trader. I don't trade gold and I don't do futures. I have very strong convictions about the fundamentals, so I'm heavily invested for the long term. To me, the market is too manipulated and too volatile to trade safely. I would not want to be caught out of the market when weekly moves like this start happening . . .

1204

I have simply accumulated a nice physical position which I intend to hold until such time as I feel comfortable selling . . . and I will sell it and move into other assets at the right time - gold is not forever.

I also hold gold and silver mining shares. Some of which I trade.

shasta
23-01-2009, 09:46 PM
Peat, I'm not a trader. I don't trade gold and I don't do futures. I have very strong convictions about the fundamentals, so I'm heavily invested for the long term. To me, the market is too manipulated and too volatile to trade safely. I would not want to be caught out of the market when weekly moves like this start happening . . .

1204

I have simply accumulated a nice physical position which I intend to hold until such time as I feel comfortable selling . . . and I will sell it and move into other assets at the right time - gold is not forever.

I also hold gold and silver mining shares. Some of which I trade.

The DOW sh*tting it's pants is good for gold, up $5 in early trading ($US861.40, or $A1,335/oz)

Aussie
23-01-2009, 09:53 PM
The DOW sh*tting it's pants is good for gold, up $5 in early trading ($US861.40, or $A1,335/oz)

It's up more than $5 . . . don't look now but it's just gone vertical skewering $860!

1205

shasta
23-01-2009, 10:07 PM
It's up more than $5 . . . don't look now but it's just gone vertical skewering $860!

I find it amusing that NEM gets virtually no coverage, & i had to dust it off the archives to find the thread & bring it back to life.

A 5m/oz per year unhedged operation with cash costs ~$US425/oz :eek:

Look at Gold go, go you good thing!

Aussie
24-01-2009, 11:19 AM
A picture tells a thousand words . . . what a week, what a battle, what a result. Gold battled 860 all week and needed to break convincingly above 880 to continue rising . . . and rise it did - even in the face of a still relatively strong USD which makes the move all the more solid and remarkable.

Gold is ratcheting itself tighter and tighter preparing for an absolute explosion when the USDX starts to break down. Read my earlier post from Bill Holter at Le Metropole to see around the corner at what's coming - and fast.

http://www.sharetrader.co.nz/showpost.php?p=240958&postcount=80

London has been in a real panic this week. Seems to me that a lot of well heeled Brits have been watching their wealth slip away as the £ is getting flushed. Last night that panic spread to NY as the cartel banks were caught short and had to cover. If things continue to devolve, as they must since the world's politicians have pushed their financial positions past the point of no return, then there is ONLY one safe refuge, and that is that barbarous relic - Gold.

1210

I'll leave you with this thought to illustrate the concept of just how little gold is available for purchase today and how incredibly cheap it still is . . .

One percent of America’s population holds 90% of its wealth. Imagine those 3 million people try to buy a mere $100,000 of gold at $900oz - a tiny amount for the richest people in America. This is about 12,000 tonnes, which is probably ALL the remaining central bank gold in existence today. Now, imagine these people want to invest more than that - much more. Now multiply this for all of the richest people in the entire world!

This is why I believe that in the near future when the real panic sets in, gold will rise to prices that people today would laugh at and find totally unbelievable. So as far as the average punter is concerned, the wealthy will make gold simply unavailable. Period.

Even in Weimar Germany in the 1920's, those smart enough to see what was happening were able to exchange their marks for gold backed Dutch guilders or even British pounds.

The situation we face today IS FAR MORE GRAVE than the 1920's because ALL currencies today are 100% fiat and yet very few people have any concept of what this means. People are trusting governments to manage their wealth when in my opinion, such trust in completely unwarranted .

In a global currency collapse which will likely be precipitated by a USD/Treasury meltdown, there will be no safe "go to" currency. Gold and silver will be the ONLY refuge.

Aussie
24-01-2009, 11:53 PM
To all; the coming next few weeks should be very telling. The action witnessed last week in my opinion was the market beginning its dicounting process of the future hyperinflation to come. Because of the size and scope of current "malinvestments" globally, we could watch "paper values" literally disintegrate over a very short time frame. For those that have not done the math, when a currency implodes and approaches zero a cup of coffee approaches infinity in that destroyed currency.

The way I see Bonds, the Dollar, and Gold both fundamentally and technically is that paper is gasping its last breath by trying to stay ahead of the financial tsunami while Gold has spent 9-10 months in a coiling phase. If the system holds together, I can envision the famed $1,650 number coming into play on this run. If the system fails, you might as well pick a number. If the Dollar is headed to oblivion and a cup of coffee is approaching infinity then what kind of number do you suppose an ounce of Gold will sport?

Last summer everyone was "short the Dollar", I believe that the short speculators have been blown away and now we will witness the most gigantic and over owned long in history go to the slaughter house. This Dollar long position took years and years to create and the Fed is doing it's damnedest to continue "spreading the wealth" [ha ha]. Now we will get to see what happens to a market when there is only ONE BUYER. In the Treasury market this one buyer is none other than The Federal Reserve. The Fed will have the job of buying gobs and gobs of Treasuries, the only problem will be that the Fed must actually "print" [digitally create] the Dollars for these purchases. This monetization will occur at the same time that the rest of the world is also selling Treasuries. We will witness humongous new supply along with secondary supply as the world regurgitates their current "safe haven" holdings. But what to do with your "safe capital" once you have exited Treasuries? Jump to another frying pan made of paper?

I see no other mathematical possibility other than a mass inflow of capital into Gold as petrified capital scurries for cover. The current setup for the greatest transfer of wealth in all of history could not be more obvious now, yet before every major market move in history the obvious was ignored. I guess it was ignored until it became "too" obvious. For those who are looking, WE ARE THERE!

The current market capitalization of the global mining industry cannot be much more than $250 billion, this is chump change when you consider how much has already been spent and how much more has been pledged by governments across the globe. The fact that this industry is so small will create massive dislocations in price when large players want to enter the arena. I can envision $20 stocks moving a point or more on less than 1,000 shares changing hands. I say this because the weak hands have already been washed of their shares, all that remains are the strong hands and firm minds. The moves witnessed in early '06 by the mining shares will pale in comparison to the phase I believe we are now entering.

If it weren't for the social and economic chaos that I believe is right around the corner, I would suggest that owning metals and the miners will be more fun than imaginable. It will probably turn out to be a matter of survival!

Regards, Bill H.

Aussie
28-01-2009, 03:14 PM
"When Treasury yields start to rise, the jig is all but UP."
(Gold This Week - January 16, 2009)

Since you are reading this you will almost certainly know that Gold's upward trajectory steepened dramatically on January 23, the spot future price climbing above $US 900 in intraday trading in New York and closing for the day up $US 37.00 at 895.80. Over this shortened trading week (January 19 was the Martin Luther King Jr holiday in the US), Gold rose almost $US 56 and climbed back into the "black" for the year in $US terms. On top of that, trading volume and open interest both increased markedly (especially on January 23) on US markets.

With January still having a week left to go, Gold has now been through an almost $US 100 trading range on the month, sliding fairly dramatically over the first two weeks only to recoup all those losses and more since January 15 when it closed at $US 807.30. Of course, the global financial system has once again worsened since then with the growing crisis in financial stocks and banks all over the world. But something else has worsened, and this one is far more potentially damaging than any crash, however severe, in the stock prices of the world's major banks.

On December 18, 2008, two days after the US Fed in effect eliminated its "Fed Funds" rate by cutting it to a target range between ZERO and 0.25 percent - US Treasury 30-year bond yields hit an all time low of 2.54 percent. By the beginning of 2009, the yield had risen to 2.79 percent. On January 15 as Gold hit its January low, the 30-year bond yield was creeping higher, closing at 2.87 percent on the day. By the end of last week, the yield had not moved, it closed at 2.87 percent on January 16.

But THIS week (January 19 - 23) the yield on the US Treasury's 30-year debt paper has SOARED - rising from 2.87 percent to 3.31 percent! That has led to the biggest plunge (don't forget with debt paper, yields and prices on the secondary markets go in opposite directions) in the 30-year bond since 1982! Yields at the short end of the Treasury yield curve where the Fed has more control have not (yet) moved up. The same is NOT the case in the longer-term debt paper.

Remember, especially in times of fiscal and/or financial strife, Gold and the yields on debt paper - especially longer-term debt paper - go in the SAME direction. This week has provided a stellar example of this principle. On the week, $US Gold prices are up 6.66 percent, the price of the US Treasury's 10-year bond is down 5.09 percent and the thirty-year paper has fared even worse than that.

What most followers of Gold know is that the stellar decade for the metal in US Dollar terms was the 1970s. What some of them forget is that the 1970s was also known as the (all but) "fatal decade" for US Treasury debt paper. Yields rose throughout the decade as higher and higher rates were demanded by domestic and international investors alike to compensate for the "profigate" (for the time) spending policies of the US government and the downward pressure put on the US Dollar as a result.

Last week, Fed Chairman Bernanke was quoted as saying that "our economic system is critically dependent on the free flow of credit." Of course it is, "our economic system" is a CREDIT MONEY system, its underpinnings are debt, the flip side of credit. Confidence in the money stands or falls on confidence in the debt which "supports" it and that, in turn, stands or falls on the perceived ability of the debtor to service and eventually repay the debt. Consider the amount of debt that the US Treasury is expected to "sell" this year to fund the US government AND the US banking and financial system. Consider the perceived capacity of the US economy to service this debt. We'll leave aside the question of repayment, the last time that US Treasury debt actually FELL year on year was 1969. In 1969, the TOTAL of funded US Treasury debt was about ONE THIRD of the $US 825 Billion "stimulus package" Mr Obama is promising his nation.

Every new US Dollar created by whatever means lessens the value of every existing US Dollar. Worse, as the amounts of new Dollars issued grows, they erode the facility of the US Dollar as a medium of exchange, a MONEY. The principle is the same for any credit-based money - and there is no other kind of money in circulation anywhere in the world.

The spike in US long-term Treasury interest rates this week is ominous in the EXTREME! It is literally not possible for the rest of the world to "buy" the quantity of new debt proposed by the Treasury even if ALL global savings were marshalled for the task. The quantity of such savings would not buy more than 30 percent of it. This points with deadly accuracy towards a situation in which the Treasury, in order to sell the debt, is going to have to offer a higher rate of interest to potential buyers to offset the rapidly growing risk of holding the paper. The same thing happened in the 1970s, but the fiscal, financial and economic situation of the US in 2009 is VASTLY worse than it was in those days.

As the amount of Mr Obama's "stimulus package" is revealed and as more and ever more bailouts are deemed "required" by those so desperate to keep the financial system and debt-based monetary system standing upright, the pressure on interest rates in the US and everywhere else will grow. As the HUGE spike in Treasury yields at the longer-end this week make perfectly plain, the process has already begun.

Gold has simply done what it always does in times of growing doubt and fear over the future purchasing power of what is issued by governments as "money". It has risen in terms of that same "money". In $US terms, Gold rose sharply this week. In terms of the Euro, the Aussie and Kiwi Dollars, the British Pound, the Russian Rouble and MANY other global currencies, Gold hit new all time highs on January 23.

dumbass
28-01-2009, 09:37 PM
stopped out on last trade having another nibble on the short side

downtrend line hit

divegent rsi

61.8 fib level hit , 892 sl 930 target 800

Aussie
29-01-2009, 01:17 PM
1221

It is not normal corrections which grates many of us in the GATA camp. It is that The Gold Cartel makes their moves at the same times, in the same places, for the same reasons. As a result, gold is training at $1,000+ per ounce less than where it would have been had they not been around.

As happens so often of late, gold was hit in the Access Market yesterday, but came back to go above $900 when London opened. Enter The Gold Cartel at their usual time, with the dollar lower, and aided by rumors of potential German central bank selling, the same rumor which surfaces on a yearly basis whenever gold has put in a big run . . .

. . . I was trading this morning in London when a rumor suddenly appeared that the German Bundesbank was selling Gold. The timing was of course perfect, and hit 30 mins after London came out buying. The rumor hit at exactly 8.30 am London time and caused gold to drop from 901.38 to 883.04 in a matter of 50 mins. Its amazing how these rumors come out when the boyz are under pressure.

Still waiting for that old treasure of a rumor of IMF phantom gold to get wheeled out! Its uncanny how they come out at rollover time LOL! Then of course the news breaks.. 'Bundesbank spokeswoman Madleen Petschmann said market rumors were unfounded that the Bundesbank had increased its activity in the gold market'.So it turns out they are buyers!

What I love about those dirty tricks is that it shows they are scraping the bottom of the barrel. Not too smart showing your hand like that.

However The black boxes don't understand rumors as the boyz well know so the funds mindlessly get milked yet again.

After plummeting to $881.40, gold recovered to $895.25 for the PM Fix due to strong demand for physical market gold. As Plan A hadn’t worked out like they planned, The Gold Cartel reverted to their standard Plan B, which is to nail the price following the PM Fix, which is just what they did … despite a continued lower dollar at the time. Treasury Secretary Geithner has not skipped a beat conducting his cabal orchestra, just like Paulson ... no surprise here, as he has been perfectly groomed with his Goldman Sachs/Treasury background.

arco
30-01-2009, 11:09 AM
For balance.

It may be a while before gold makes a BIG move higher. The problem is that gold jewelry demand (the biggest source of demand for gold) is falling even as investment demand rises. The SPDR Gold Trust, the largest exchange-traded fund backed by bullion, just expanded its holdings to a record 832.88 metric tonnes. Gold holdings at SPDR are now more than 50 tons higher than a month ago. This battle of forces could slow gold's rise for some time.
Sean Broderick 28th Jan 09

____________________________


From a commodity adviser sent today to me (30/1) by e-mail
THERE IS A GOOD RUMOR IN THE WORLD MARKET THAT GERMANY IS GOING TO SELL OFF IT'S GOLD RESERVES. SO SELL GOLD IF BREAK $870 WITH SL $ 920 TARGET $ 820 - $800

Mysterybox
30-01-2009, 08:08 PM
stopped out on last trade having another nibble on the short side

downtrend line hit

divegent rsi

61.8 fib level hit , 892 sl 930 target 800

Got stopped out on the same move, oh well

Aussie
30-01-2009, 08:50 PM
Hey Arco, a couple of thoughts . . .

1) The jewelry industry is a large consumer of gold but from what I understand it also it also sources a lot of it's material from the scrap market. In many Asian and Middle Eastern countries jewelry and investment gold demand are the same thing - that's why people buy it over there. We buy coins and ingots, in their culture they buy chains necklaces, pendents etc. It serves the same purpose. Western demand for investment gold as well as central bank demand (China) will skyrocket in the months and years ahead - all against a backdrop of declining gold production.

2) The German rumor was a beat up, nothing more.

"THE PRICE OF WHOLESALE SPOT BULLION bounced from an early 2% drop in London on Wednesday, picking up to $889 per ounce after the German Bundesbank denied rumors it was selling bullion to help fund the federal government's new €50 billion economic stimulus package . . . "

http://www.fxstreet.com/fundamental/analysis-reports/london-gold-market-report/2009-01-28.html

3) As far as The SPDR Gold Trust is concerned, HSBC is it's custodian and investors of GLD have plenty to be worried about . . . here's a review of their prospectus from a contributer to Le Metropole Cafe.


_______________________________

HSBC is the custodian of GLD. (I am using the S1 prospectus filed with the SEC on 11/16/04). If it is the case that GLD is leasing out the gold in GLD, and if HSBC were to go bust, the GLD Prospectus clearly states on page 13 that "gold held in the Trust's unallocated gold account and any Authorized Participant's unallocated gold will not be segregated from the Custodian's assets. If the Custodian becomes insolvent, its assets may not be adequate to satisfy a claim by the Trust or any Authorized Participant.

In addition, in the event of the Custodian's insolvency, there may be a delay and costs in incurred indentifying the bullion held in the Trust's allocated gold account. The unallocated gold accounts are the accounts used to hold gold being deposited into the Trust, or being redeemed from the Trust. That is not "segregated" from the Custodian's assets means that bars of gold are not specifically identified as gold that belongs to the Trust vs. assets that belong to HSBC.

The prospectus further states that in the event of insolvency by HSBC, the Trust becomes an unsecured creditor of HSBC with respect to unallocated gold. Leased gold would either be held in unallocated accounts moving in and out of the Trust, or the physical gold might not even be in the Trust, as subcustodians as described below, could lease out the gold and no one would know or would have the legal ability to find out.

As for the "allocated" gold - that which has been specifically identified as property of the Trust and held in a segregate account - in the case of HSBC going insolvent, the Trust can claim ownership of the properly allocated gold, but will be subject to the liquidator freezing access to ALL gold in ALL accounts held by the Custodian, including gold held in the Trust Allocated Account.

It gets worse. HSBC has the ability to appoint subcustodians to hold gold for the trust, and the subcustodians can appoint further subcustodians (page 12-13). From page 12:

Because neither the Trustee nor the Custodian oversees or monitors the activities of subcustodians who may hold the Trust's gold, failure by the subcustodians to exercise due care in the safekeeping of the Trust's gold could result in a loss to the Trust.

Worse yet, the Prospectus states that there will be no written contractual agreements between subcustodians and the Custodian or the Trustee (page 11-12). AND the Trustee has no right to visit the premises of the subcustodian to inspect the gold or examine the subcustodians records.

Essentially, what all this says is that in the event of insolvency by HSBC, the shareholders of the Trust may in fact have no ability to capture ANY part of their investment in GLD shares. I have further work and analysis to do, but given what I have researched so far, I am quite stunned that anyone would invest money into GLD, as there are absolutely NO shareholder protections against the gold in GLD not being there, or for the shareholders to assert specific claims of ownership. Given that HSBC may be on the brink of insolvency as per Jessel's source, anyone who buys GLD thinking they are buying gold is risking losing everything - that is, being "Madoffed."

peat
30-01-2009, 10:54 PM
Got stopped out on the same move, oh well

has it actually hit 930?

shasta
30-01-2009, 11:25 PM
has it actually hit 930?

Nope not yet....

http://www.kitco.com/images/live/t24_au_en_usoz_home.gif?random=0.74957275390625 (javascript:NewWindow('/charts/popup/au24hr3day.html','Au30Days','top=50,left=200,width =670,height=560');)

dumbass
31-01-2009, 07:01 AM
Where's the Gold Cartel, when you really need them to manipulate that gold price lower?

stopped out for nada.

anyone fancy going to auckland sharetrader meeting , we havent caught up for a while , Peat Arco anyone ?

arco
31-01-2009, 08:30 AM
anyone fancy going to auckland sharetrader meeting , we havent caught up for a while , Peat Arco anyone ?

Might be able to depending on date? Has that been decided yet (and venue).

arco

Dr_Who
31-01-2009, 08:30 AM
WOW... looks like gold maybe heading for $1000 mark again.

dumbass
31-01-2009, 03:58 PM
Might be able to depending on date? Has that been decided yet (and venue).

arco

i think the votes are still being counted

JBmurc
31-01-2009, 06:37 PM
wow nearly $1500ozAUD wasn't long ago gold bugs though $1000aud was a great achivement now add it the fact Gold producers costs are reducing going be some nice gains in some of the ASX jnrs
DIO producing 90k oz ,IRN sitting on share of a massive copper/gold deposit,neither hegded
HGD,OGC also worth buying in the dips

Aussie
01-02-2009, 10:18 AM
Hourly Action In Gold From Trader Dan
Posted: Jan 30 2009 By: Dan Norcini Post Edited: January 30, 2009 at 3:47 pm

Dear CIGAs,
Gold buying accelerated as Europe opened for trading in the overnight hours here in the States with the currency crisis the main factor propelling European based gold prices sharply higher. Paper is definitely OUT in Europe and metal is in. I suppose what is so revealing about this is that is marks an abrupt reversal from a pattern that has been seen for most of the better part of the entire near-9 year bull market in gold. Asian buying would take the metal higher whereupon the return of Europe based traders to their desks, it would be summarily derailed around the 2:00 AM CST period. What is happening now is that the price is accelerating higher near or about this hour. It has become obvious that a sea-change in sentiment towards the yellow metal has occurred in Europe and particularly in Britain. With no where to put money for a safe haven as bonds become suspect, gold is seeing significant hedge fund activity which is beating back the incessant selling by the bullion banks. That buying drove Gold priced in Euro terms to another brand new, all-time high for the London PM Fix at €715.620. Euro gold has taken out €700, quite a significant feat! So much for the deflationists’ arguments…

Once trade moved into New York, the bullion banks resurfaced in force and attempt to stem the tide. Today they initially showed their hand near and above the $920 level. Their footprint is more than obvious for those who can read price charts. However, in what must have been quite a stunner to these bullies of the sand box, they were beaten back out of their castle as the bulls pushed right through their picket lines. They have been feverishly attempting to stem the rise near $920 as failure means the highs made back in September-October last year around the $940 level would then be in play. If those give way, $1000 is a given and they know it.

The fly in the gold ointment however is once again, the mining shares which were whacked well off their session highs in a near perfect copy of Monday’s performance. The battle for 310 in the HUI and 127 in the XAU is quite fierce as the trapped shorts seem to be literally mounting a life or death defense of those levels. So far the bulls simply cannot dislodge them from their lairs but the day is not done yet and the longs are also showing some mettle for a change as they push the indices back up off the session lows. A strong closing breach of those levels, especially coming at the end of the week and thus painting a very strong showing on the weekly price charts, is something that the shorts are desperately trying to prevent. They know that a technical breakout will bring even more money into the gold shares which will overwhelm them and that is the reason we are seeing such fierce opposition coming in near those levels. I am sure that they are quite concerned about the reported record inflows in the largest gold ETF – GLD. That is why observing this kind of fierce and determined selling in the face of what is evidently a significant move into all things gold is so noteworthy. Just who sells like this and does so in such huge size when the path of least resistance is up?

Technically gold has CONFIRMED yesterday’s bounce off of the top of the triangular consolidation formation – the downsloping trendline which it broke out above earlier this week and then came back down and touched before ricocheting sharply upward off of that same line. The price action in this market is textbook and its behavior is more like I have come to observe in a normal, freely-traded market, bullion bank capping efforts notwithstanding. The fact that it has been performing so well-behaved tells me that serious buying has come into this market, buying which makes itself known on any price dips. Simply put – the safe haven flow into bonds has completely dried up and gold has now become the go-to vehicle. (I will show this on the Gold/Bond ratio chart which I will send up later this afternoon or evening). If the funds will stick to their guns, there is no reason that they cannot dislodge the bullion banks out of their defensive lines since the fundamentals are on the side of the longs. Keep in mind that the gold universe is still rather small in size and that it does not take all that much money to push it around.

I will be switching to the April gold contract for analysis purposes last week as the February has gone into its delivery period. Speaking of that, delivery notices for the first day of the period were strong, not as strong as December’s which stunned many observers as it came in at 8,600. By contrast, February’s first day were a mere 1,644 or 164,400 ounces. While I am glad to see the bulls shoving the perma gold shorts around for a change, the way to drive a final nail in the coffin and put these vampires to rest for good is to continue taking delivery of the gold and physically removing it from the Comex warehouses. Without the backing of physical gold in the warehouses, the shorts haven’t a leg to stand on and can be easily defeated.
Open interest is still a miniscule 348,000 contracts, far, far off from the peak made back when gold took out $1,000 where it peaked above 593,000. Can you see why this market is in such a bullish posture with the open interest readings at such a low level and gold less than $80 away from the $1,000 level? The funds could add another 150,000 new longs and the open interest would still be almost 100, 000 off the peak! That is simply astonishing to this long-time trader. It is difficult trying to maintain a modicum of objectivity and not let one’s emotions cloud their judgment when analyzing this market simply because even contemplating another 100,000 new longs along, much less 150,000 or even 200,000 and $1500 gold would be a given. The bullion banks are going to have to absorb a tremendous amount of buying to merely keep gold from charging to $1000.
Resistance for gold is near the $938-$940 level and above that at $950. Support remains first near the $900 level and then at yesterday’s lows around the $880 level.

Equities continue swooning as further details of the government’s “stimulus” bill become known and the thing is seen for what it really is – a gigantic pork-ladened spending orgy which will do little in the way of creating any lasting jobs in the bill’s current form. Bonds still do not like it because they continue to remain focused on the enormous supply of debt coming down the road that is going to be created as a result of this boondoggle.

Click link to enlarge today’s hourly action in Gold in PDF format with commentary from Trader Dan Norcini

http://www.jsmineset.com/wp-content/uploads/2009/01/January3009Gold1230pmcdt.pdf

ananda77
01-02-2009, 05:45 PM
...there was a news item on TV3 tonight, sorry just saw 1oz Kiwi gold coins and a guy talking about the start of an extremely golden bull run for the next 20 years...

Kind Regards

Financially dependant
02-02-2009, 10:37 AM
An interesting article by Clive Maund I stole of HC...

http://www.clivemaund.com/article.php?art_id=68

shasta
05-02-2009, 09:33 AM
An interesting article by Clive Maund I stole of HC...

http://www.clivemaund.com/article.php?art_id=68

UBS raises 2009 gold forecast to $1,000/oz, ups silver, platinum

London (Platts)--4Feb2009UBS has raised its average gold price forecast to $1,000/oz for 2009, andexpects the strength in gold to pull prices for silver and platinum up alongwith it, the investment bank said Wednesday. "Purchases of physical gold have jumped over the past six months asinvestors' fears about the current financial crisis and the possible outcomesfrom government efforts to support banks and economies have intensified," UBSsaid. "We believe that a doubling in investment demand (compared to 2007) is areasonable assumption considering the recent inflows into the gold ETFs, wherethe past six months of purchases has totalled 8.65 million oz, slightly morethan the full-year inflow of 8.1 million oz into these products in 2007," thecompany said. This figure is also consistent with the reports of physical investmentflows into bars and coins over the past six months and estimates by a UK-basedconsultancy GFMS of bar hoarding in the second half of 2008, UBS suggested. "Based on simple regression modelling we estimate that this will drivegold to an average $1,000/oz in 2009, from $700/oz previously," UBS said. "For2010 we have assumed that investment demand will fall back to the already highlevels seen in 2008, which generates a gold price of approximately $900/oz,and we see the gold price falling back further to $800/oz in 2011." RAISES 20089 SILVER FORECAST TO $14.75/OZ The company has also raised its silver price forecast for the period,noting that "compared to gold, silver does not have as wide an appeal as asafe-haven investment, the metal is not without its adherents: as gold moveshigher, silver tends to follow." UBS now sees silver averaging $14.75/oz in 2009 and $12.80/oz in 2010,from its previous forecasts of $8.40/oz and $8.95/oz, respectively. "The metal's greater proportion of industrial applications has seensilver underperform gold over the past year ... but a rising price environmentfor gold should see silver reverse some of this underperformance," UBS said. In addition, there are indications from the recent performance of silverthat the metal has been able to lose some of its industrial tarnish, the banksaid, adding that correlations with the copper price - which increased in2008 as silver fell sharply - have recently declined, while silver'scorrelation with gold has increased back toward historical norms. "Consequently we have made greater upgrades to the silver price comparedto gold," UBS said. "But despite this, silver's historically highervolatility, especially to the downside during times of correction, makes it ariskier investment than gold." PLATINUM 2009 FORECAST UP, PALLADIUM UNCHANGED UBS has raised its average platinum forecast for 2009 to $1,050/oz from$900/oz, and left its 2010 forecast unchanged at $1,100/oz. "Platinum very rarely trades at a discount to gold and when it does, thediscounts are short-lived," the bank noted. The market is seeing somesafe-haven buying, jewelry demand remains relatively buoyant compared to otherprecious metals, and the destocking by automotive companies which hit pricesin 2008 is unlikely to be repeated, UBS suggested. The bank left its forecast for palladium unchanged at $190/oz in 2009 and$233/oz in 2010. "We have made no changes to our forecasts for palladium, where theinterplay between limited safe-haven demand, ample above-ground stocks andpoor industrial demand has left the palladium market steady around our priorforecast levels," UBS said.Similar stories appear in Platts Metals Week.See more information at http://plattsmetals.platts.com (http://plattsmetals.platts.com/)


Instead of merely posting a link, i'll nominate the 3 stocks i think represent best value for the article above.

Gold - NEM: A 5m/oz+ Gold producer, no hedging, pays dividends

Silver - CXC: FY09 ramp up is for 23m/oz Silver & 140k/oz Gold

PGM's - PLA: A Platinum producer (+ other precious metals)

arco
05-02-2009, 01:07 PM
Instead of merely posting a link, i'll nominate the 3 stocks i think represent best value for the article above.

Gold - NEM: A 5m/oz+ Gold producer, no hedging, pays dividends

Silver - CXC: FY09 ramp up is for 23m/oz Silver & 140k/oz Gold

PGM's - PLA: A Platinum producer (+ other precious metals)

Very helpful information for consideration Shasta - thanks

arco

Aussie
07-02-2009, 12:28 AM
"My guess is the panic into precious metals is going to begin in earnest when the sovereign states start to default . . . Populations are only then going to realise the true implications of a broken banking system when the ability of their own government to keep the dream alive disappears."