Posted by Investment Rarities on December 5th 2013 in China, Federal Reserve, GATA, General Economy, Gold, India, Janet Yellen, JPMorgan, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!
In reporting on a keynote speech at London’s Mines & Money conference by John Hathaway, asset manager of the Tocqueville Gold Fund, Mineweb‘s Lawrence Williams writes that “Hathaway’s interpretation of gold’s decline, paints an exceptionally bullish long term picture….The same physical demand that has caused an apparent unwinding of trades in the paper market will therefore drive a ‘new leg in a secular bull market for gold’, with an eventual ‘implosion of credit structures’ in the gold futures markets of London and New York.” Williams has more coverage of the conference, in a separate article headlined, “Bull market or bear market – where does gold stand now?“
Jesse’s Café Américain: Comex deliverable gold still out on the tails of leverage at 57 to 1
Reuters: Gold drops 1.1% on uncertainty over Fed tapering; Silver also off 1.1%
Coin News: Gold gives back some gains; U.S. Mint gold bullion coins soar
Business Insider: People are buying a lot of silver & gold with their Bitcoins
Liberty Blitzkrieg: Gold smuggling increases 7x in India and surpasses illegal drug trade
GATA: Grant Williams: Today’s gold suppression will break just as London Gold Pool did; Williams – Twisted (By the Pool)
Zero Hedge: Jim Rogers cautions “Be prepared, be worried, and be careful… This is going to end badly
IB Times UK: Freedom Ship: $10 billion floating city for world’s super rich
Posted by Investment Rarities on December 4th 2013 in CFTC, Federal Reserve, General Economy, Gold, Janet Yellen, JPMorgan, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!
U.S. stocks fell for the fourth straight day on tapering fears after the ADP employment report showed that 215,000 new private sector jobs were created in November, topping expectations. But Comex gold and silver futures gained 2.2% and 4% as the prospect of tapering was overshadowed by a drop in the dollar and short covering. One trader told Bloomberg that “We saw gold take off as the dollar began its slide.” And, quoting a market strategist who said that “It almost seems too easy to get short gold right now,” Dow Jones reported that “on Wednesday, the widespread bets on lower gold prices backfired. An updraft on the back of a lackluster dollar swiftly escalated into a rally, which caused more traders to try to limit losses on bearish wagers.”
Posted by Investment Rarities on December 3rd 2013 in General Economy, Gold, Short Sellers, Silver, Wall Street | Be the first to comment!
With stocks seeing their first three-day losing streak since late September on Tuesday, Dan Norcini observed that “the VIX has scored a five week high today for some reason. I tend to watch this indicator in conjunction with the action in the equities as a way to gauge any potential shift in overall confidence. In my view, the only thing that can bring a firm bid into gold and reverse the current bear market in the metal is a heightening of fear/unrest/unease or better, a growing lack of confidence. Yesterday we had a move higher in the Dollar. Today that has been erased. With the Dollar weakening gold is getting a bit of a bid today. Also aiding the metal is the sharp, and I do mean ‘sharp’ rise in crude oil. It touched $96 ( basis WTI ) in today’s trade and is currently up over $2.00 barrel as I type these comments.”
See also: The next Black Swan – A dollar crisis
Posted by Investment Rarities on December 3rd 2013 in Federal Reserve, General Economy, Gold, Janet Yellen, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!
Wondering “Is it time for gold investors to admit defeat?,” Casey Research’s Jeff Clark answers that since “all the reasons gold rose from 2001 to 2011 are still in force, I am convinced gold’s current correction is the setup for a second big surge—and, ultimately, a true gold mania of historic proportions….Just because gold doesn’t seem to be reacting to Fed money-printing at the moment doesn’t mean it won’t. Sooner or later, reality trumps fantasy. Reason says that you can’t quintuple your balance sheet in five years and expect no repercussions. The Fed keeps hinting it will taper its money printing, but it still has not. We’ve had QE1, QE2, Operation Twist, and now QE3… none of them has worked, and the new Fed chair wants to print even more money. It’s pure fantasy to believe there will be no consequences to these actions—and the reality is that whatever else happens, gold will react positively.”
Posted by Investment Rarities on December 2nd 2013 in Federal Reserve, General Economy, Gold, Janet Yellen, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!
Comex gold and silver futures ended down 2.3% and 3.7% respectively on Monday as unexpectedly strong ISM manufacturing data was seen increasing the likelihood that the Fed could announce tapering this month. But the CIO at a wealth management company told Reuters that “The ISM news should not trigger a selloff in gold like this. A lot of momentum-driven and institutional investors are piling on gold’s decline by short selling it.”
And pointing out that “The metals were pounded fairly steadily all day, in light trade,” a post at Jesse’s Café Américain also speculates that “we may see the ‘December effect’ in gold and silver, in which the metals are hit in the first part of the month, only to recover into the year end.” This as USA Gold reports “very strong interest from physical buyers on dips. Many of them specifically cite their worries about the stock market as the reason for their desire to add gold to their holdings. It’s never a bad idea to lock in some of your stock market profits and buy a non-correlated asset as a hedge. Gold fits that bill nicely.”
Reuters: Nobel prize economist Robert Shiller warns of U.S. stock market bubble
CNBC: Marc Faber – ‘We are in a massive speculative bubble’
John Hussman: An open letter to the FOMC: Recognizing the valuation bubble in equities
Doug Noland: Pertinent bubble insights from the Roaring Twenties
The Victory Report: Axel Merk – I sleep better with gold holdings than equities
Of Two Minds: Metallic money (gold/silver) vs. credit money: Know the difference
Posted by Investment Rarities on November 29th 2013 in China, Federal Reserve, Gold, India, Monetary Policy, Quants, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!
Following reports that China imported 131.9 tonnes of gold through Hong Kong in October, for a total of 967 tonnes this year, Mineweb’s Lawrence Williams, who believes even that figure is conservative, wonders: “When are investors in the West going to wake up to the fact that if China carries on buying at current rates – and there’s no sign of any slowdown – there soon won’t be any physical gold left to trade in the traditional markets – it will all be being swallowed up by China and the other eastern consumers. If anything points to a massive price squeeze ahead this has to be it!”
And in examining who benefits from golds “organized retrreat,” a USA Gold commentary points out that China’s annual imports, “according to some market watchers, are on the order of 2500 tonnes, nearly the equivalent of the annual global mine production.”
SilverSeek: Gold and silver gain almost 1% on the week
Bloomberg: Comex gold futures rise on signs of increasing demand in China
Seeking Alpha: Lawrence Williams – How high are China’s real gold imports?
Alasdair Macleod: Chinese gold demand and the World Gold Council’s estimates
Economic Times: Gold purchases – China to surpass India
SafeHaven: China gives thanks for cheap gold
Posted by Investment Rarities on November 27th 2013 in CFTC, Gold, Short Sellers, Silver, Wall Street | Be the first to comment!
“I consider the current price drop to be possibly the final opportunity to acquire physical metals at bargain prices,” writes Numismaster‘s Patrick Heller, looking at “two significant developments” that “hit the precious metals market last week. One was expected and one is a real eye-opener. The expected news was a new round of gold and silver major price suppression, which will likely continue unabated through the release of the U.S. non-farm payrolls report on Friday, Dec. 6. There are a number of events beginning last week through Dec. 6 which are either standard times when precious metals prices are ‘suddenly’ clobbered or are opportunistic times to manipulate prices during thin trading periods.”
He identifies the “surprise development” as one that occurred in the Comex gold options market: “Last Wednesday, the December 2015 gold options contract with a contract price of $3,000 per ounce was the most actively traded contract of any month and of any contract price level. About 7,250 call option contracts were purchased, signifying potential physical demand for 725,000 ounces.” Suggesting that this “may be unprecedented,” Heller concludes that “Obviously there are an unknown number of investors that anticipate a significant rise in the price of gold within the next two years. Time will tell whether today’s gold and silver prices indicate what prices may languish for the next 24 months or if the prices of both metals will explode upwards. Personally, I anticipate the latter will be nearer the mark.” …Read More >>>
Posted by Investment Rarities on November 26th 2013 in China, Federal Reserve, General Economy, Gold, India, Janet Yellen, JPMorgan, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!
As gold and silver end slightly lower on Tuesday, Gold Scents asks if gold is in a “Brief pause, or final bottom?” And in an interview with The Gold Report, publisher and radio host Jay Taylor also weighs in: “The chances are better than 50/50 that we’ve seen the bottom and we’re just meandering around and building a base for the next major leg up. It’s not hard for me to imagine gold exploding off the launch pad to hit new highs. The question is: How much higher than $1,900/ounce will it go? I don’t have a strong opinion on that. It depends on how the economy goes and the psychology of the masses.”
Asked if he thinks silver will follow suit or chart its own course, Taylor predicts that “It will follow suit, to a great extent, because it will take on more of a monetary component; currently much of its demand is still from industry. Silver and gold nearly always move in the same direction, but because silver is more undervalued than gold, it could have a much bigger move in percentage terms.”
Zero Hedge-Bloomberg: How gold price is manipulated during the “London Fix”/Original article
Jesse’s Café Américain: Gold bullion ETF and fund drains in 2013 – Comex registered at 69 to 1
Got Gold Report: GoldCore’s Mark O’Byrne – China gold demand causing paradigm shift
Peter Schiff: Ben’s rocket to nowhere
Wall Street On Parade: New York Fed’s strange new role – Big bank equity analyst
Bloomberg: Speed traders meet Nightmare on Elm Street with Nanex
Posted by Investment Rarities on November 26th 2013 in General Economy, Gold, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!
Following an overnight hammering that led to gold’s 4th market halt in the past three months, and seen as “probably a pre-emptive effort to shake out a few more weak hands ahead of this afternoon’s option expiration for gold and silver,” they ended Monday up 0.5% and 0.7% respectively.
And while Monday’s initial selling pressure on gold and silver was also attributed to the Iran nuclear deal, which lifts some sanctions on precious metals, Bloomberg reports that according to Standard Bank and Societe General, it will probably have little impact on prices. The article quotes one analyst as saying that “you’re not going to see a significant investment or divestment” because of the lifting of sanctions.
Posted by Investment Rarities on November 24th 2013 in China, Federal Reserve, General Economy, Gold, Janet Yellen, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!
“It’s not only the Chinese aunties buying gold who are racking up retail sales of precious metals this year. Sales of silver eagle coins by the US Mint this year are already at a record high,” notes Arabian Money, following a week in which silver lost 4%:
“Silver and gold investors are taking out an insurance policy against a known risk that is guaranteed to reoccur at an unspecified future date. That’s why people continue to buy silver eagles when the price of silver is falling. They are buying their insurance policy at a discount with the disaster coming closer. The truth is that the Fed will not be able to stop printing money or by the time it does there will be so much money in the system that any economic recovery will be accompanied by horrendous inflation.”
Posted by Investment Rarities on November 24th 2013 in China, Gold, India, Silver | Be the first to comment!
“While paper gold is getting the cold shoulder in the West, the Love Trade buyers in the East are wrapping their arms around all the physical gold they can get their hands on. In the third quarter, gold jewelry demand was at the highest level since 2010,” reports U.S. Global Investors’ Frank Holmes, according to World Gold Council data. Holmes, in his chart-rich presentation, also points out that “so far in 2013, the East purchased 5 times more gold bars, coins and jewelry than the West. Together, Chindia purchased a whopping 1,500 tonnes in physical gold in nine months.”
Posted by Investment Rarities on November 22nd 2013 in CFTC, Federal Reserve, General Economy, Gold, Janet Yellen, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!
With Comex gold and silver futures down 3.4% and 4.2% respectively for the week, Dan Norcini, lamenting gold’s “meager bounce” on Friday, writes that “The number of bulls continues to fall as more and more investors/traders flee the precious metals sector in favor of high yields in equities. Once again the Dow is over 16,000 and the S&P 500 has now broken firmly above the 1800 level. With those kinds of gains, who needs gold is the new trading adage.
Until something happens which derails equities and sends shock waves of fear throughout the financial system (something which rattles CONFIDENCE) it is difficult for me to envision gold moving higher other than occasional bounces from short covering. Look at the VIX or Volatility Index. It is stuck at multi-year lows. The complacency in the system is nothing short of astonishing. There isn’t a care in the world in the minds of most investors/traders!”
SilverSeek: Why gold and silver are having a tough time
P. Radomski: Precious metals – The long-term perspective
Bloomberg: Gold option wagers on surge to $3000 was most-active Wednesday
Jim Wyckoff: Why tapering may be bullish for metals
SafeHaven: Hard to believe but gold remains in a bull market
USA Gold: Trust your instincts
Posted by Investment Rarities on November 21st 2013 in China, General Economy, Gold, India, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!
Spot gold and silver prices rebounded on Thursday, and the gold/silver ratio ended the day at just above 62. Numismaster‘s Patrick Heller argues that it’s headed lower over the next two years, and here’s why:
1. I anticipate substantially higher prices for both metals in the next year or two. With silver being more volatile in price, it should increase by a greater percentage than gold, which would knock down the ratio.
2. The amount of newly mined silver supplies is only about 10 times more than gold. Stated differently, there is not enough silver coming out of the ground to provide 50 or 60 ounces of physical silver for every ounce of gold needed for investor and industrial purposes.
3. The price of silver has acted counterintuitively in 2013. Through several changes in taxes and import restrictions, India’s government has severely restricted the ability of the citizenry to acquire gold. As a consequence, demand for physical silver in India has soared over the past few months.
Heller concludes that “silver will outperform gold over the next couple of years. To be conservative, I still think gold should make up one-third to 40 percent of one’s combined investment in gold and silver, but I am definitely favoring the prospects for silver.”
Posted by Investment Rarities on November 21st 2013 in China, Federal Reserve, General Economy, George Soros, Gold, Janet Yellen, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!
In a MarketWatch column offering up “4 reasons gold is poised for a comeback,” InvestorPlace.com editor, Jeff Reeves, suggests that “it’s possible that gold has found a floor and that now is a decent time to buy.” He concedes that “there are still some big challenges for the precious metal — especially in the last week or so when prices have been steadily rolling back again. But even if investors are a bit early as they turn to gold, fears of overbought domestic stocks may make even an uncertain bet in gold a preferable alternative to some right now.” The four reasons he cites are 1) global physical demand, 2) a slowing in the pace of ETF outflows, 3) Smart money likes gold, and 4) Tapering delayed, buy not denied. And about the latter he reminds that “gold rallied from a low of under $1,200 at the end of June to $1,400 in August on the expectation that tighter monetary policy was on the way.”
Posted by Investment Rarities on November 20th 2013 in China, Federal Reserve, General Economy, Gold, Goldman Sachs, Janet Yellen, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!
Gold and silver extended losses following Wednesday’s release of the FOMC’s October meeting minutes, which revealed discussion of tapering “in coming months” or “at one of its next few meetings.” And while the minutes were described as “bearishly construed” for gold and silver, with one precious metals telling Reuters that “Tapering is still definitely on the table,” Zero Hedge points out that “all it takes is for one algo to get the idea of pricing in the inevitable subsequent un-taper and to send the entire risk complex soaring.”
Sober Look: 5 years of QE and the distributional effects
Dan Norcini: ECB to move to negative interest rates
Reuters: Gold pours into China to meet record demand, bypasses Hong Kong
Mineweb: Financially strained Venezuela reportedly cuts gold deal with Goldman Sachs
Sprott Group: 19 ‘tough’ questions for Eric Sprott on gold and silver
Posted by Investment Rarities on November 19th 2013 in China, Federal Reserve, General Economy, Gold, Goldman Sachs, Janet Yellen, JPMorgan, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!
As Bloomberg reports that gold is “no slam-dunk sell in China as aunties buy bullion,” MarketWatch quotes the Midas Letter‘s James West as saying that “Gold and silver prices continue to be buffeted by demand for physical gold from Asian buyers versus negative investment sentiment in the western world expressed in sales of ‘paper’ gold…. Either the western world under appreciates the growing divergence between physical supply and demand, or an absence of regulation in terms of position sizes in paper derivatives of gold engenders mispricing. Either way the long-term price for precious metals is pressured upward with every new month of a quantitatively-eased increase in sovereign debt.”
Reuters: Fed’s Yellen maintains dovish message in lawmaker letters
Alasdair Macleod: Fiat money quantity hits new record
Economic Policy Journal: Treasury printing of $100 bills exploding
Mineweb: Analyst – China gold consumption running at over 2,000 tonnes this year
Zero Hedge: Gold manipulation probed by U.K. regulator
Posted by Investment Rarities on November 19th 2013 in China, Federal Reserve, General Economy, Gold, India, Janet Yellen, Monetary Policy, Silver, Wall Street | Be the first to comment!
In an interview with the Birch Gold Group, Jim Rogers covers the waterfront on currency wars, the likely difficulties the Fed will face in tapering, and of course, precious metals. He declares that “I’ve never sold any gold and if gold comes down and I expect it to go down, doesn’t mean it will, I’ll buy more. I’m certainly not going to sell.” And asked if he prefers silver or gold, he points out that “silver is historically down 60% from its all-time highs, so yes, I would prefer silver at the moment because gold is down only what, 30 or 40% from its all-time highs.” And in an interview with Bull Market Thinking‘s Tekoa Da Silva, Rogers discusses what he sees as the “artificial” highs in the U.S. stock market, and explains why he’s not buying gold yet.
Posted by Investment Rarities on November 18th 2013 in Federal Reserve, General Economy, Gold, Janet Yellen, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!
Comex gold and silver futures fell 1.2% and 1.8% respectively on Monday, reports Bloomberg, which quoted one trader as saying that “Money is running toward equities. Also, people want more information about what the other Fed officials are thinking about tapering.”
Two of those officials weighed in on Monday, and their comments were seen as “adding more weight to the notion that the central bank is getting close to reducing the pace of its monthly asset purchases.” According to an analysis published at Got Gold Report, a more hawkish Fed could ultimately benefit gold and silver, by reversing the up-trend in the equity markets.
As gold was being “monkey-hammered lower” on Monday by “status quo support” for stocks, U.S. stock markets were hitting new highs, before, as USA Today reports, “Wall Street finally suffered a bout of acrophobia.” And USA Gold points out that “If investors start viewing the stock market as ‘frothy,’ equities could correct dramatically even with the tacit promise of continued central bank accommodations.”
And with bitcoin surging as high as $675 on the Tokyo-based Mt. Gox exchange, in advance of Monday’s Senate hearing, Gold Silver Worlds quotes Peter Schiff, who said on CNBC: “I don’t see bitcoins as an alternative to gold. It is not a modern day gold standard. If anything, they are modern-day alchemists but you can not make gold digitally. It is no better than a fiat currency.”
Posted by Investment Rarities on November 15th 2013 in CFTC, China, Gold, India, JPMorgan, Short Sellers, Silver, Ted Butler, Wall Street | Be the first to comment!
Despite gaining almost 1.5% on Thursday and Friday, Comex silver futures fell 2.8% for the week, reports MarketWatch, “But analysts and bullion dealers touted strength in physical demand for silver.” The article cites sales of 2013 American Silver Eagles topping 40 million this week to set an annual record, and, MarketWatch‘s latest “Commodities Corner” column, headlined “Silver coin supplies buckle on fever-pitch retail buys.” It quotes BullionVault’s Adrian Ash as saying that “Private investor demand for physical silver in 2013 has been staggering,” and, “Refiners can’t mint enough product and they’re seeing none of it come back for melt.”
Bloomberg: U.S. Mint’s silver coin sales reach annual record
Wall Street Journal: Investors flock to silver coins
Silver Investing News: Silver trades down as Thomson Reuters GFMS predicts higher demand in 2013
Steve St. Angelo: Silver Bears: You have been warned
SilverSeek: Eric Sprott – Silver, silver stocks will go much higher
Posted by Investment Rarities on November 15th 2013 in China, General Economy, Gold, IMF, India, Monetary Policy, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!
Following up on its report that “China could match U.S. gold reserves inside 10 years – or earlier,” Mineweb deploys the above graph to illustrate “gold’s inexorable move east.” It shows the percentage change in investment demand between the first three quarters of 2012 and 2013, and comes from the World Gold Council’s Q3 Demand Trends that was released on Thursday. And in another article based on the WGC’s release, Reuters reports that “China is this year set to usurp India as the world’s biggest gold consumer by a convincing margin as strict import rules introduced by New Delhi bite.”
And detailing the boom in Asian vaults, the Sprott Group’s David Franklin writes that the new facilities “further reflect the enormous increase in the physical precious metals trade and a requirement for secure storage. With these new vaults located in Asia (or now owned by Asians) it would appear the massive amounts of gold being shipped East will not see the inside of a London or Swiss vault ever again.”