Pedal to the Metals

As American Silver Eagles have their second-best January since the coin was introduced in 1986, with 6,107,000 sold,  Patrick Heller, in a CoinWeek article, argues that the “Rush to buy physical gold and silver hasn’t started yet.” While providing an extensive list of reasons why the supply of gold and silver is constrained, he believes that the “largest impact on the prices of both will come from a surge in buying demand.  Even though there has been an increase in demand for the two metals for industrial and investment purposes, the market has not yet experienced a sustained rush to buy physical gold and silver.”

Related Links:  

Dow Jones:  U.S. jobs surprise dents gold

MarketWatch:  Gold futures fall 1.1%, log first drop in four sessions; silver down 1.3%

Wall Street Pit:  Gold and silver outperform in January; Is there more upside in 2012?

Kitco:  Gold prices could correct next week, but trend remains up

Telegraph:  Gold will rise against ‘heavily debased‘ currencies

Barratt’s Bulletin:  Silver the better bet

Beacon Equity:  Gold:Silver ratio screams buy silver

Citywire:  Silver needs ‘a new group of investors‘ to keep surging higher

Bill Bonner:  Buying gold in uncertain times

MarketWatch:  Short-term risk is now quite high in the gold arena

Zero Hedge:  Kyle Bass: “Don’t sell your gold“

Bullion Vault:  Gold capitalises on low interest rate environment

Bloomberg:  Payrolls jump casts doubt on Fed rate pledge

ABC News:  U.S. jobs report skepticism: As good as it gets?

Jesse’s Café Américain:  The non-farm payrolls report: Air brushing history

Mike Shedlock:  In January, those “Not in Labor Force” rose an amazing 1,177,000

Fiscal Times:  Why most U.S. manufacturing jobs are gone forever

MarketWatch‘s Brett Arends interviews gold standard advocate, Jim Grant, who’s having what NPR described as “A gold bug’s moment in the political sun.” Newt Gingrich named Grant to co-chair a potential gold standard commission, after Rep. Ron Paul said that if elected president, he would nominate Grant to be his Federal Reserve chairman.  “Unfortunately, I haven’t heard from Mr. Romney yet,” jokes Grant, but “I’m sitting by the phone, I’m ready.”

Asked what he would do as Fed chairman, Grant “said he’d begin by communicating to the public why the present system was so wrong, and needed to be changed. He’d make the case for the gold standard….In his ideal world, says Grant, he would lay out a three-year program to convert back to the gold standard, probably at around $2,500 per ounce of gold.” More from Grant, who calls gold “sort of the Muhammad Ali of monetary substances; the world over, you look at it, you know what it is.”

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Dow Jones/Beacon Equity:  Gold at 11-week high on Bernanke debt warning; silver gains 1.1%

Zero Hedge:  Bernanke is indeed a gold bug’s best friend

Wall St. Cheat Sheet:  Gold and silver continue to rally

Jesse’s Café Américain:  Gold & silver charts:   Clawing up the wall of worry one brick at a time

CNBC:  Golden rally

Bloomberg:  UBS:  Gold is getting new investors first time in 3 months

Arabian Money:  Precious metals trounce stocks in best January for decades

Commodity Online:  Silver: The dynamics of demand and supply

Market Oracle:  Silver and the shift to measuring wealth in ounces instead of dollars

Barron’s:  Metals, miners make waves; Time to buy equities and gold?

Trader Dan:  Euro gold comments

Reuters:  Italy top gold scrap buyer sees booming business

GoldSeek:  Iran’s currency war heats and the people rush to metals

Mineweb:  China’s gold output and demand could be far greater than ‘official’ data suggest

Spiegel:  The hard sell:  Merkel seeks euro zone investments from Beijing

New York Times:  U.S. Treasury ponders negative interest rates

In the above video, the Wall Street Journal’s Rhiannon Hoyle is interviewed about her report that “Investors are loading up on gold and silver coins in what some say could be an early sign of a rally in precious-metal prices. In this case, individual investors may be ahead of professionals.”

Sales of American Eagle gold bullion coins almost doubled from December to January, according to U.S. Mint figures, with 127,000 ounces sold in January compared to 65,500 ounces in December 2011.  And January sales of Silver Eagles reached 6,107,000, more that three times the 2,009,000 sold in December 2011.

Related Links:  

Dow Jones:  Dollar declines send gold near 2-month high

Marketwatch:  Gold closes 0.5% higher on positive market sentiment; silver gains 1.6%

Reuters:  Gold keeps up rally after best January in 32 years

SafeHaven:  The next 17 months for gold

Bullion Street:  Silver off to perfect start with 20% gain in January

David Morgan: Silver in the next decade

The Gold Report:  James Turk:  Great deals on gold and silver

Beacon Equity:  Hey silver bugs: Is James Turk off his rocker?

Zero Hedge:  PIMCO’s Bill Gross:  Why gold is becoming the default “store of value”

Benzinga:  Central bankers weaken their currencies, boost gold

Mineweb:  China enhances position as world No. 1 gold producer – but where’s it all going?

Daily Reckoning:  Gold in the face of Facebook

Bruce Krasting:  The CBO report – OMG!

Gary North:  Ben Bernanke: The official counterfeiter

Of Two Minds:  Our counterfeit economy

Although there is evidence that the silver supply is consistently overstated, with the price popping 19% in January,  Bloomberg reports that “Record industrial demand for silver and resurging investor interest is diminishing a supply surplus, driving the metal used in everything from solar panels to batteries into its best start to a year in almost three decades.”

That and a Financial Times‘ article on silver’s latest surge, prompts GoldCore to remind that “Silver supply shortages are something we and other analysts who are bullish on silver have been warning of for some time. This is because the silver market is small versus the gold market and tiny versus equity, bond, currency and derivative markets.  This is why we believe silver should rise to well over its nominal recent and 1980 high of $50/oz in the coming months.”

Related Links:

Dow Jones:  Gold ekes out $6 gain, silver down 26.5¢

MarketWatch:  Gold up 11% in January; silver gains 19% on month

SafeHaven:  What made gold break out?

Trader Dan:  Gold knocking on the door of resistance at $1750

KWN:  Bill Fleckenstein – Get ready, public to enter gold & silver markets

Wyatt Research:  Silver opportunity begins anew

Coin News:  January Silver Eagle sales top 6 million (scroll down)

SilverSeek:  Eric Sprott:  Mania. Manipulation. Meltdown.

Bullion Bulls Canada:  Exposing silver mythology

Mineweb:  Anti-German backlash could boost gold and silver

Mike Shedlock:  You ain’t seen nothing yet; Another trillion (or two) euro LTRO coming next month

Demonocracy:  Infographic:  The European super highway of debt

Jesse’s Café Américain:  Is the next phase to be commodity wars?

Frank Holmes:  Heart of China bull beats strong

Bloomberg:  Venezuela receives last shipment of repatriated gold bars

Asia Times:  Iran well-prepared for the worst

Steve St. Angelo, who recently wrote about 2011 being the first year in which silver coin sales will surpass domestic silver production in both the U.S. and Canada, argues for a “coming paradigm shift in silver” that will send silver to a triple-digit price, but “will not happen due to technical analysis, fundamentals, or supply & demand forces, but rather due to a change in mass psychology of investors.  Even though fundamentals and supply-demand forces will play a part in this shift, they will not be the ultimate cause.”

Related Links:  

Dow Jones:  Comex gold eases on euro caution

MarketWatch:  Gold closes $1 lower on higher greenback; silver falls 26¢

Kitco:  Speculators continue to build bullish positions in metals

SilverSeek:  Silver market update

SafeHaven:  Silver: Epic reversal

China Daily:  Spring festival sparks a ‘gold rush’ in China

Bullion Street:  China gold sales up 57.6% during first week of Dragon Year

Wall St. Cheat Sheet:  Is 2012 the year of the Golden Dragon?

Mineweb:  Gold the hottest currency - just ask the Chinese

MarketWatch:  Gold bull methodically takes profits

KWN:  Richard Russell – Gold threatening dollar’s reserve currency status

Gold Scents:  “A lot is riding on the dollar right now”

Tim Iacono:  Will Bernanke’s war on savers kick off the U.S. gold boom?

Alasdair Macleod:  FEDging the figures

Rep. Ron Paul:  Failed Fed policies prolong the agony   

Lewis Lehrman:  2012 is the year for a gold plank in GOP platform

USA Gold:  Survivalist George Soros

Cambridge House International has posted more than 50 videos from its Vancouver Resource Investment Conference held last weekend.  Among them is the above interview with David Morgan who discusses his presentation on the silver market, — including silver myths, particularly that “silver is not money” — and responds to investors’ concerns that they may have “missed the move” in silver.

And interviewed by Hard Assets Investor, Morgan is asked, “Where do you think silver is headed in terms of price this year?”  He replies that “I’m on record saying $60 by the end of the year. The key is to get through that $50 psychological barrier. It’s probably going to take a couple of tries…. Once it does that, you could see silver go up from $50 to $60 in a matter of two weeks. That’s the kind of move silver is capable of making.”  He also discusses the implications of silver being “in tightly held hands,” and explains why he prefers coins over bullion.

You can sign up for SilverSeek‘s free online presentation of Morgan’s “Silver in the next decade.”

Related Links: 

Dow Jones:  Gold climbs for third day, ends at 7-week high

MarketWatch:  Weekly gains for gold reach 4.1%; silver gains 6.7% on week

Silver Investing News:  Silver price surpasses $33 on Fed statements

Bloomberg:  Gold bulls ascendant on biggest rally since ’80

Kitco:  Gold’s rally expected to continue next week

Reuters:  Analysts Survey:  Gold seen rising in 2012, 12th year of rally

Independent:  Going for gold

Seeking Alpha:  Expanded horizon of negative interest rates should boost gold and silver prices

P. Radomski:  Stock Market and dollar sustain bullish environment for precious metals

KWN:  Jim Rickards – Gold may super spike as we see the end of the dollar

MarketWatch:  China’s yuan set for more international role

321 Gold:  Funeral for a bond

Zero Hedge:  Tim Geithner added to list of gold bugs’ best friends

Wall St. Cheat Sheet:  With friends like these does gold need an official QE3?

Bloomberg/GoldCore:  Roubini’s bearish forecast is bullish for gold

Peter Schiff:  Waist deep in the big muddy

Gold and silver topped Bloomberg‘s list of the best returns of all commodities in the past five years when adjusted for volatility.  Leading the Bloomberg Riskless Return Ranking was gold, which produced a 6.5 percent risk-adjusted return, followed by silver at 3.1 percent.  The total-return index for all raw materials was 0.2 percent.

The article quotes UniCredit SpA analyst Jochen Hitzfeld, described as “the most accurate precious-metals forecaster tracked by Bloomberg in the past two years,” as saying that “People are still very under-invested in gold, and so there is a huge scope of that increasing.”  Last week Bloomberg reported Hitzfeld’s prediction that “Gold will average $1,800 an ounce this year, and rise even more next year on investor and central bank demand.”

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Kitco:  Comex gold hits 7-week high on follow-through strength, bullish technical momentum

MarketWatch:  Gold adds 1.6% on post-Fed rally; silver up 1.9%

Trader Dan:  The party continues

GoldMoney:  Bernanke lights a fire under gold and silver prices

KWN:  Stephen Leeb – Fed game changer sparks 2nd leg of gold & silver bulls

Zero Hedge:  Has Bernanke become a gold bug’s best friend?

GoldSeek:  How long can the Fed pump up the US bond bubble? Time to shift into hard assets?

Gold Scents:  Broken dollar

Mineweb:  Sprott’s John Embry:  Fiat currency system meltdown has huge implications for gold and silver

Barron’s:  Hedge fund guru sees gold price soaring

Jesse’s Café Américain:  A closer look at the gold chart for a break and run possibility

J.S. Kim:  Identifying severe undervaluation points in gold & silver beats trying to perfectly time bottoms

Times of India:  Gold for Iran oil? Indian govt declines any comment

Silver Investing News:  Buying support boosts India silver price

NYT:  Stored for decades, Hitler’s silver is to go on display

Reviewing the London Bullion Market Association’s 2012 silver forecast, — by 25 professional analysts, including commentary from each — Mineweb‘s Lawrence Williams writes that “they anticipate an average silver price over the year of $33.98 and a high of $44.49, but even this, which some might consider a conservative prediction, still represents a substantial 39% increase over the current $32 price for the metal.  And taken in conjunction with the gold price forecast, suggests that the gold/silver ratio may come back a bit from the current 52 to around 46 – well above the low point achieved last year and hugely above the so-called historic ratio of 16:1 so beloved of the principal silver bulls.”

Related Links:

Gold Alert/Forexpros:  Fed: No QE3 but low rates through 2014, USD drops, gold rebounds

Kitco/Jesse’s Café Américain:  Comex gold soars to 6-week high in wake of “dovish” FOMC statement

MarketWatch:  Silver leads gains in metals, ends at highest since mid-November

SafeHaven:  Fed to markets:  Buy gold and silver

Trader Dan:  FOMC to markets:  “Welcome to the party“

Reuters:  Bernanke says Fed pondering further stimulus

Zero Hedge:  And the winner is…gold

KWN:  Jim Sinclair – Mainstream entities will now enter gold market; Eric Sprott – Aggressive Chinese buying will spike gold price

Globe & Mail:  Sprott takes a new path toward less volatility

Seeking Alpha:  Silver: Historical upside potential

Arabian Money:  Talk of Dubai Gold Souk: silver to double in six months

Commodity Online:  US gold production gains 2.6%, silver declines 8.7% in 2011  

SilverSeek:  Bullish technical signals support silver and gold prices

P. Radomski:  Dollar’s influence on gold

Murray Pollitt:  Gold is the uninvited guest

Telegraph/NYT:  Davos keynote: Merkel defiant as IMF leads attack on Germany; pleads for patience to let Europe solve its problems/Video (at 24 min.)

Following what is expected to be a record year for central bank gold purchases in 2011, according to a World Gold Council report, Reuters quotes a 2012 forecast by HSBC analyst James Steel, who writes that “The outlook for central bank gold purchases remains positive for this year, based on the likelihood that emerging markets central banks will continue to diversify away from the U.S. dollar. Since U.S. dollar foreign exchange holdings are already at record levels in many countries, we believe these nations will seek to increase gold reserves, in a bid to diversify their USD-laden reserves. While we do not expect official sector activity to move the market near term, we regard central bank purchases as a bulwark of the long-run gold rally.”

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Kitco:  Gold ends weaker on profit-taking, corrective technical pullback; silver down 29¢

Global Macro Monitor:  Is gold about to get a monetary blast (off)?

CNN Money:  The new new gold rush

KWN:  Richard Russell – Comex gold & silver shorts in do-or-die battle

MoneyWeek:  Look what’s happening to silver

Wall St. Cheat Sheet:  Currency wars are driving gold and silver higher

Bloomberg:  Iran said to seek yen oil payments from India amid sanctions

Forex Crunch:  Report:  Gold for oil – India and Iran ditch dollar

GoldSeek/Asia Times:  Sovereigns declare war on U.S. dollar; Sheikhs fall in love with renminbi

Sharps Pixley:  Chinese gold sales in the year of the water dragon

GoldCore:  Japan gold buying on Tocom again supports

Washington Post/Zero Hedge:  IMF report: Global economy looks grim for 2012; Former IMF chief economist on Europe’s last stand

Bloomberg/Reuters: Pariahs no nore, U.S. bankers ascend at Davos; Top Justice officials linked to mortgage banks

Wall St. Cheat Sheet:  Is this the secret Wall Street fraternity that rules the world?

Economic Policy Journal:  Mitt Romney loves Goldman Sachs

Forbes:  Gingrich, the gold standard, and the Florida primary

As gold and silver hit fresh six-week highs, with prices for both said to be “regaining altitude on stimulus rumours,” Trader Dan Norcini sees the above chart revealing “all you need to know about whether or not silver is going to perform. If risk is in and hedge fund money flows are coming into the commodity complex in general, it will move higher. When it does, silver goes right along with it. When risk is out and money flows OUT of the commodity complex, silver sinks like a lead brick.”

On Saturday’s King World News‘ “Weekly Metals Wrap,” Norcini said that “what I’ve noticed over the last 3-4 weeks now is that the hedge funds that had been shorting silver are beginning to cover … because it looked like, based on the technicals, that silver was finding a pretty good bottom down there below $30…. Now we’re at a point in silver where we have a very low long-side exposure, with the market turning bullish as far as the technical indicators go, and the price being above the important moving averages, and what it’s going to do now is to start attracting some of this money that’s been on the sidelines, as long as this environment persists.”

Related Links:  

Kitco:  Comex Gold ends higher on bullish “outside markets,” positive technicals

Tim Iacono:  The remarkable rise in the price of silver

Arabian Money:  $58-60 silver price by September says Dubai silver trader

The Golden Truth:  Got silver? An overlooked factor that will affect supply this year

MarketWatch/Barron’s :  Silver outperforming gold; Sprott impacting silver?

Got Gold Report:  Sprott Silver Trust (PSLV) premium collapse costly  

Mineweb:  In gold, inflation we trust – Sprott’s Franklin argues

Financial Sense:  Inflation: The only tool left

GoldSeek:  More QE on the way

Peter Brimelow:  Gold’s happy new year

Russia Today:  Gold may remain a very attractive asset in 2012

Zero Hedge:  Nomura:  A longer-term perspective on gold

GoldCore:  Currency wars – Iran banned from trading gold and silver

Fox News:  David Morgan:  How does China play in the bigger commodities picture?

Financial Times:  Year of Dragon lifts China gold demand

CBS MoneyWatch:  Gold prices driven by Asia, not inflation

In asking “When Will Silver Make a New High?,” a Casey Research analysis reviews the biggest corrections in the current bull market.  The most recent one is the longest of the three, but it’s close to the average drop of 42.1%.  And while “Counting from the previous peak of April 28, 2011 we wouldn’t break the $48.70 high until May 26, 2013 … an exact date is pure conjecture, of course, and ignores fundamental factors that directly influence the price. 2011 is not 2008.”

One example cited is “an interesting shift in investment activity in both gold and silver markets. The Silver Institute pointed out in a recent market report that ‘investor activity’ was the biggest contributing factor to both last April’s rally as well as September’s selloff. Meanwhile, [investor] demand for physical metal has not only held firm but was projected by GFMS to reach a new record high in 2011.

Investment demand is rooted in the metal’s monetary characteristics. It’s not a stretch to say that we expect silver to regain its currency appeal soon, given the amount of worldwide fiat currency destruction. This will be perhaps the strongest catalyst for prices going forward. We wouldn’t want to be without any silver.”

Related Links:  

MarketWatch:  Gold up with eye on Greece; silver rallies 3.8%

Dow Jones:  Comex silver hits 6-week high on demand hopes

Kitco:  Uncertain outlook for gold prices next week; Fed mtg could influence direction

Seeking Alpha:  Buying gold on more QE

Money Morning:  QE3, $2,200 gold, and the trillion dollar bazooka

TG Metals Report:  The significance of $1665

Equities.com:  Is gold/silver ready for bounce back after 2011 correction?

Silver Investing News:  Silver forecasts mixed on uncertain economic outlook

Arabian Money:  Gold and silver price forecasts for 2012 probably too pessimistic

Wall St. Cheat Sheet:  Inflation concerns remain as gold and silver climb higher

KWN:  Shadowstats’ John Williams – Gold, silver, economy & inflation

GoldSeek:  Suppressing unemployment to win the election

Sober Look:  Divergence of gold price and sovereign CDS spreads

Gary North:  Auditing the FED’s gold

GATA:  Bullion banking system ‘not fully backed,’ Naylor-Leyland tells CNBC Europe

As the Wall Street Journal reports that “The Chinese have been loading up like never before on gold ahead of the Lunar New Year, which falls on Jan. 23 this year,” a Reuters analysis looks at how Chinese banks are encouraging gold buying.  Headlined “China’s banks lure man on the street to gold,” it cites one bank that has signed up more than 2 million customers under a program with the World Gold Council that was launched in 2010. Investors “buy as little as a gram a month through the accounts, a tiny quantity but one that adds up when the middle class of the world’s most populous country is involved.”  The article also notes that “China has one of the world’s highest saving rates, and the public faces few investment options. A volatile stock market and a property market under government crackdown are driving investors to seek alternative investment choices.”

Related Links:

Kitco:  Gold ends modestly lower on mild profit-taking from recent gains

MarketWatch:  Gold ends 0.3% lower after two-session climb; silver down 3¢

Barron’s:  Eric Sprott:  Gold to still top $2k an ounce, silver seen rallying in 2012

Contrarian Investor:  Is rising demand for physical silver signaling a rally?

Coin News:  U.S. Mint sales:  Bullion coins (scroll down)

KWN:  Stephen Leeb – Why gold & silver are about to soar

The Gold informant:  Where to be if/when the metals markets explode – Part 1 and 2

CNBC:  Is bullion back? ‘Gold is still in a super bull market’

Peter Brimelow:  James Dines’ gold call and his new theory on “murmuration”

Bullion Vault:  Real risks to the gold price

New York Times:  Will India’s higher import duties dampen demand for gold?

Bloomberg:  Gold, currencies and commodities: Axel Merk’s outlook

Mineweb/New York Sun:  Newt Gingrich calls for U.S. Gold Commission; Gingrich goes for the gold

Janet Tavakoli:  Gold and silver market manipulation, look for motive

Reuters:  JPMorgan again at center of a financial failure

Courthouse News Service:  JPMorgan Chase accused of brazen bankruptcy fraud