Monday, October 31, 2011

James Turk - Silver Formation Projects Spike to $60 - $75 Level

“Central banks everywhere are trying to debase their currencies and Japan is just the latest episode.  A few weeks ago it was the Swiss National Bank and we’ve seen continuous debasement by the Federal Reserve with it’s dollar money printing and artificially low interest rates.  This is exactly what happened in the Great Depression.  Back then they called it ‘Beggar thy neighbor.’
Each country was trying to seek a short-term solution to fundamental ills by manipulating their respective currencies.  Manipulation doesn’t solve underlying problems.  It doesn’t even offer a band-aid because it disrupts the market process.  The net result of this turmoil is hot money, which is constantly looking for a safe home.  The underlying chaos detracts from businessmen making sound investment decisions in plant and equipment which creates long-term growth, employment and wealth.
When all countries are aiming to debase their currency, the conclusion is quite obvious.  First, you will see money rushing from one currency to another, depending on what central banks are doing at that moment.  Second, and more importantly, all currencies are being debased against gold, so its price will rise.  The value of gold comes from the market and not from central banks.  Central banks can debase currencies, but they cannot debase gold.”

Europe Blowing Last Chance to End Crisis

I would amend the title to Europe never had a chance.

Dick Bove Goes For The Post-Lehman Twofer: MF Global Is Fine

Anybody who followed this clown Dick Bove's advice would have lost a fortune--3 times.  He fancies himself a banking analyst.

Full MF Global Bankruptcy Petition... In Which We Find That Corzine's Bankrupt Firm Owes CNBC $845,397?

In bankruptcy court filings, MF Global bank owes financial broadcaster CNBC almost $1 million.  I wonder how much Goldman Sachs owes CNBC?

John Williams of on GDP data
“. . .the widely-followed gross domestic product (GDP) nonetheless remains the most-heavily-biased, the most-heavily-guessed-at, the most-heavily politicized and the most-worthless major indicator of domestic business activity.  Today’s numbers out of the Bureau of Economic Analysis are outright nonsense.  Consider that latest numbers showed that the level of inflation-adjusted third-quarter 2011 GDP broke above the pre-recession high of fourth-quarter 2007: a full recovery.  That is absurd.  No other major economic indicator, including payrolls, real (inflation-adjusted) retail sales, industrial production, trade deficit or housing starts is showing that.”  - John Williams,, commenting on official 2011 Q3 GDP growth of 2.5%.

Buchanan: Credit-Default Swap Bomb Wired to Explode

Saturday, October 29, 2011

Europe at war 2018

And now, for some light weekend reading...

Norway’s Sovereign Wealth Fund Sold All U.S. Mortgage Bonds

There goes the Fed's plan to keep mortgage interest rates low.  As the Street floods the market with US Treasury and mortgage-backed paper, it will become increasingly difficult for the Fed to pin interest rates low.  Of course, they can extend the charade longer with more bouts of bond purchases, a.k.a., QE 3.0.

Friday, October 28, 2011

To fix the economy, fix the housing market
The central irony of financial crisis is that while it is caused by too much confidence, too much borrowing and lending and too much spending, it can only be resolved with more confidence, more borrowing and lending, and more spending.  
And people wonder why our economy is failing.  Lawrence Summers is acknowledged as an economics genius, serving as President Clinton's Treasury Secretary, head of President Obama's National Economic Council, and President of Harvard University.  Yet, this opening statement in this article clearly delineates why our global financial system is on the verge of collapse.  He aims to solve overconsumption and indebtedness with more consumption and piling on more debt.  Genius.

Eric Janszen: We Are Witnessing The Death of the Dollar

Carney: QE’s stealth effect is a weaker currency

Royal Canadian Mint Announces Offering of New Gold Investment Product

This Canadian ETF appears to carry less risk for two reasons:

1) the custodian is the Royal Canadian Mint
2) it is backed by physical gold.

See disclaimers in the side bar.

Disclosure:  I have no position in these ETR's.

Auguries — What’s Behind Door No. 3?

GATA Slays The Dragon

Want To Defeat The Banks? Stop Participating In The System!

What’s a young person supposed to do?

US fury as Karzai backs Pakistan


Wednesday, October 26, 2011

BlackRock Expects “Massive” Mining M&A

Raiffeisen Bank TV-Ad: Easy (sub-prime) loans in Hungary, 2007

I thought this video was a spoof, but I think it was a real ad from a bank offering subprime mortgage loans--back in 2007.

The Best Mistake You'll Ever Make

This conversation allegedly took place in 2006.
The Best Mistake You'll Ever Make
By Jeff Clark, BIG GOLD
The following conversation took place between a friend's son and I; he's a bright but relatively young investor. He had purchased some gold based on some things I'd told his father. Shortly afterward, the price dropped hard. As you'll see, he was not very happy with my advice and said so in an email to me. So I called him...
I: Sounds like you're upset.
Friend: Yeah, that's putting it mildly. What the hell am I supposed to do now?
I: Because the gold price has dropped?
Friend: Yes! It's down 15% in a month! I thought you said this was going to be a good investment.
I: It is. And it will be. You might even consider buying more here if you have the funds.
Friend: I have some other money, but why would I put it in gold? It's losing money.
I: Because it's on sale. Because it's cheaper now than when you bought it. And especially because none of the reasons for buying it have gone away.
Friend: That doesn't mean it's going to go back up.
I: As I told your dad, there are no guarantees, but I think it will have to go higher. Either way, it will hold its purchasing power over time. We're holding it as an alternate currency, a more sound form of money that can't be debased.
Friend: Yeah, well, my money just got debased, big time. It needs to go up 20% for me just to get back to even.
I: Five years from now your dollars will have lost at least 10% of their value, based just on current trends. There's a good chance it will lose more than that. And gold will probably rise more than 10% a year. At some point it''s likely to go into a bubble.
Friend: [silence.]
I: Look, I know you're upset, but I'd hate to see you bail. This is one of the best investments we can make this decade.
Friend [relenting a little bit]: You really believe that.
I: I can't promise you anything, but yes, I do.
Friend: And that's because you think inflation is coming.
I: It's for a lot of reasons, and that's one of them. Inflation is virtually baked in the cake; the dollar's long-term problems will be impractical to resolve; and the global economy is on high alert. This is exactly the kind of circumstances gold is for.
Friend: Then why is it falling?
I: Institutions need cash and liquidity, and gold offers a bid. Besides, nothing goes up in a straight line, and gold had just run up 35%. It was time for a break.
Friend: So this big drop really doesn't worry you.
I: It doesn't. I'm buying. In fact, I'll prove it to you - send me your gold and I'll buy it from you.
Friend: [Silence.]
I: I know it doesn't feel good right now, and it may take some time for it to make another new high, but gold is too important not to own here. It's a long-term trade, so plan on holding it for a while. In fact, if it helps, just forget about the fact that you own it - go do something fun and have a beer at the pub.
Friend: [a little chuckle].
I: I don't think you made a mistake buying at the price you did, in spite of it being lower now. Odds are high you'll be happy in a few years.
Friend: [pause] All right...
I'm glad my son's friend decided to hold on, because that conversation took place in June, 2006. He'd bought gold at around $700 and watched a month later as the price fell to as low as $567.
Gold ended up declining a total of 21% in just five weeks before bottoming, after a run-up of 35% (sound familiar?). And yes, it took over a year before it hit a new high.
Yet my son's friend - now older and wiser - wishes he could go back in time and make the same mistake again and buy gold at $700. His investment is sitting on more than a double, in spite of buying at a temporary peak.
I think that a few years from now we'll all wish we could go "back in time" and buy gold at $1,700. And I believe you'll still feel that way if gold falls to $1,500, as some writers are projecting.
I think this because circumstances now are worse - and hence more bullish for gold - than they were in 2006. Look at how much money we've printed (the monetary base now exceeds $2.6 trillion, a mind-boggling 200% increase since 2006). Look at the state of the global economy - highly vulnerable and propped up by governments. Consider the lingering and inescapable predicament of many European nations - scare tactics aside, how, exactly, will this be resolved in a healthy way? Ask yourself if the outlook for the US dollar is out of the woods (roughly 10% of federal revenue goes solely to debt payments, a figure that is projected to triple). Explain how the reckless path of deficit spending will shift without causing some kind of major impact on the economy (history shows abject deficit spending leads to economic downfall, virtually without exception). Tell me how we avoid massive inflation, an outcome that seems so certain at this point that about the only way to avoid it would be a massive global meltdown - and even then, the Fed would surely print to oblivion.

Like I told my son's friend, nothing is guaranteed. But until real interest rates are positive again, government leaders instigate honest solutions to our debts and deficits, the global economy becomes an engine of growth, the sovereign debt issues in Europe are genuinely resolved, and global currencies - especially the US dollar - are strong again, I'm buying gold.
Yes, there will be volatility. And yes, a short-term "solution" to what seems like certain default in Greece, for example, would cause some investors to sell gold. But like in the spring of 2006, these are temporary, short-term fixes only. For the tumult that is most likely ahead, there simply isn't any better currency protection than gold and silver.
Join me in calling your favorite bullion dealer and making the mistake of buying gold at $1,700.
[No one knows with any certainty the future's trajectory... but we at Casey Research know that contrarian investing will continue to be a profitable strategy as nations continue to meddle in markets.]

Chris Powell: Nine blows against the gold price suppression scheme

Paper currency has too much bull, not enough bullion

Self-Reported Gun Ownership in U.S. Is Highest Since 1993

Gold Breaks Out and Consolidates Above $1,700/oz – Financial Alchemy Risks Severe Inflation

Friday, October 21, 2011

Sean Corrigan: Value can't be calculated after governments wreck markets

Is there a shadowy plot behind gold?

Russia cbank says will raise gold share in reserves

Paul Brodsky: The Seeds of Our Destruction Were - And Still Are - Sown in the Bond Markets

Fed’s Yellen: QE3 May Be Warranted

Jim Rickards - Western Gold Policy Threat to National Security

Blame the Fed for the Financial Crisis

Guest Post: If The US Goes, Won't The Rest Of The World Be Even Worse?

France Likely to Lose Top Rating in Stressed Economic Scenario, S&P Says

US Money Supply Surges Surges 33% in 4 Months - Gold To Follow?

Why I Was Completely Wrong About Gold

Visualizing The True Cost Of The First Bank Bailout: $3.5 Trillion And Rising At Over $1 Trillion Every Year

What is immediately obvious is that US debt is currently $3.5 trillion higher than where it would be had America's banks not received a rescue.
The truth is that this is a proportional increase which if extrapolated into the future, means that every year the US will incur well over $1.2 trillion each and every year as a result of bailing out the banks. That is the true cost to Americans regardless of what Tim Geithner may claim. But note how we said First. Unfortunately, the Second Great Financial Crisis, that of bailing out insolvent sovereigns, is currently and process. And when all is said and done, the global cost in terms of new "trendline" debt will be many more trillions in incremental debt every year. And despite what economic voodoo theories say, near infinite debt always ends in near infinite pain. It will this time too. Guaranteed.

GAO Finds Serious Conflicts at the Fed

Conflicts of interest at the Fed?  Surely you jest...

Happy Days Are Here Again

Ummm...not really.

Fed's Tarullo backs more MBS purchases

A Fed governor clamors for more QE.

Thursday, October 20, 2011

London Trader - China Bought Massive Amount of Gold Today

The bullion banks are manipulating down the price of gold with their paper trading schemes, but this only aids buyers in Asia, as they buy the physical bullion at lower prices.  By scalping short-term profits, the bullion banks are just accelerating the depletion of physical inventory, auguring in an upside explosion in price later on.
“The price discount in gold is the most welcome thing to the entire Eastern Hemisphere.  The Chinese are buying very relentlessly because they know what is going to happen.  We had a major, major physical buy order today.  The Chinese bought a massive amount of physical today at the lows.
“They (the Asians) are aware of how tight physical supply is and they buy in London towards the fix because they know there is an 80% chance the commercials will take it down and they will get a better price.  The Asians sit there and say, ‘Bring it on because we’ve got some orders to fill.’  They just want out of their dollars.
Unbelievably this is part of a continued transfer of wealth from the West to the East.  While our central planners try to figure out how to keep the broken system functioning, the cost to the West is we keep emptying our vaults of gold and shipping it to the vaults in the East.

Student Loan Bubble To Exceed $1 Trillion: "It's Going To Create A Generation Of Wage Slavery" And Another Taxpayer Bailout
"The amount of student loans taken out last year crossed the $100 billion mark for the first time and total loans outstanding will exceed $1 trillion for the first time this year. Americans now owe more on student loans than on credit cards, reports the Federal Reserve Bank of New York. Students are borrowing twice what they did a decade ago after adjusting for inflation, the College Board reports. Total outstanding debt has doubled in the past five years — a sharp contrast to consumers reducing what's owed on home loans and credit cards."

Nassim Taleb on Wall Street Protest, Banking

The author who coined and penned "The Black Swan" gives a classic rant on bankers' salaries.

Libyan Oil Fully Liberated On News Gaddafi Dead

Thanks to Kitty for finding this gem.
All we can say is be careful who you shake hands with. Next up: burial at sea.
Click on image to enlarge.

Wednesday, October 19, 2011

European CDS Ban Sends 1 Year Greek Bond Yield To 188%

Steve Wynn Epic Anti-Obama Rant Part II - Full Audio And Transcript With Complete #OccupyWallStreet Thoughts

Houston, we've got a problem - Bevilacqua

In essence, the ruling upheld that those who had purchased foreclosure properties that had been illegally foreclosed upon (which is virtually all foreclosure sales in the last five years), did not in fact have title to those properties.
Given the fact that more than two-thirds of all real estate transactions in the last five years have also been foreclosed properties, this creates a small problem.
The Massachusetts SJC is one of the most respected high courts in the country, other supreme courts look to these decisions for guidance, and would find it difficult to rule any other way in their own states. It is a precedent. It's an important precedent.

Silver price manipulation: 'public deserves answers'

The Fraud At The Heart Of Student Lending Exposed - The One Sentence Everyone Should Read
"Vince Sampson, president, Education Finance Council, said during a panel at the IMN ABS East Conference in Miami Monday that lenders are no longer pushing loans to people who can’t afford them." Re-read the last sentence as many times as necessary for it to sink in. Yes: just like before lenders were "pushing loans to people who can't afford them" which became the reason for the subprime bubble which has since spread to prime, but was missing the actual confirmation from authorities of just this action, this time around we have actual confirmation that student loans are being actually peddled to people who can not afford them.

Citi Joins Goldman And JPMorgan In Settling Fraudulent And Misleading CDO Practices: Wristslap Costs $285 Million

How's This For Social Unrest?

Monday, October 17, 2011

Sprott makes a bet on a different kind of bank

Good for Eric Sprott, the Canadian billionaire who's been on the right side of the precious metals trade for more than a decade.  According to Gresham's Law, bad money drives out good money.  In other words, people will dump debased paper fiat currencies, and hoard sound currencies, with gold being the soundest.

In the past, the Swiss franc was the most stable of currencies, reflecting centuries of sound banking policies.  That situation reversed itself several weeks ago when the Swiss National Bank pegged the "Swissie" to the sinking Euro, in attempt to stimulate their exports and tourism industry.  Apparently, the USDollar and Euro had weakened too far, driving up the Swissie and price inflation (and rendering Swiss products non-competitive).

With all developed countries trashing their sovereign currencies in a race to the bottom, gold will be the last man standing among currencies.  And a currency 100% backed by gold will maintain its role as a store of value, in addition to being a medium of exchange.

Misery Index drives gold demand

David Einhorn: The Inevitable Ramifications Of Short-term Popularity Policies Over Solvency

A long, oldie but goodie analysis from David Einhorn.

Hong Kong Starts Trading Gold in Yuan to Tap ‘Triple Demand’

This is further evidence the USDollar is beginning to lose its status a the global reserve currency.  Do readers think I'm being hyperbolic?  What were your opinions when I declared US Treasury debt was not deserving of its AAA credit rating--2 years ago?

Ron Paul to propose $1T in specific budget cuts
The federal workforce would be reduced by 10 percent, and the president’s pay would be cut to $39,336 — a level that the Paul document notes is “approximately equal to the median personal income of the American worker.”

SocGen Asia Strategist Has Near Fit On Bloomberg TV After Making It Clear That It's All The Blogosphere's Fault

Sunday, October 16, 2011

Steve Keen On Keynes And The Failings Of The Neoclassical School

Intraday average gold price movements

Look at the price takedowns coincident with the London AM and PM fixes.  Nah, the price of gold isn't manipulated in London and New York. /sarcasm.

Click on image to enlarge.

My interpretation:

1) Intraday swings on the price of gold will become more volatile going forward, so if you plan on buying on a particular day, it looks like 7 am and a little bit after 8:30 am are the best times to buy (Pacific Standard Time).

2) The 7 am time is due to the London 3 pm gold fix, when they engineer a huge take down on a consistent basis.

3) The 8:30 am time is probably due to certain coordinated bear attacks after the release of US economic data, perhaps housing or unemployment data (e.g. nonfarm payroll reports?).

4) Buying at New York's close is usually profitable as Asian buying overseas provides firm support for higher prices.  The daily cycle then repeats itself.

Remember:  this is a chart of daily intraday price swings, so the action is not guaranteed.  But because it is a chart of averages, and there are so many data points to draw from, there is no way the price swings are random.  They occur at eerily consistent points in time of the day.  Of course, buying physical bullion is a long-term play, so these intraday price swings should generally be considered noise.  However, for those desiring optimal entry points, this may be another useful guide in your arsenal.

See disclaimers in the side bar.

How to get to a true gold standard

Return to Gold Standard? Why Price Would Hit $10,000

Saturday, October 15, 2011

Jim Rogers Sees Devastating Stagflation, Would Quit If He Was A Bond Portfolio Manager

This illustrates why one can be correct--and still lose money.  Being early requires conviction.
Now that we already had one notorious bond bear in the house with a late afternoon appearance by Bill Gross, who in a very polite way, apologized and said that while he may have been wrong in the short-term, he will be proven correct eventually, it is now time for the second uber-bond bear to make himself heard. In a CNBC interview with Jim Rogers, the former Quantum Fund co-founder, who back in July said he was had shorted US Treasurys, exhibited absolutely no remorse, instead reiterated a 100% conviction in his "bond short" call: "Rogers said when there is a bubble, such as the one being experienced in U.S. Treasurys, prices could go up for long periods of time. Bill Gross of Pimco, who also had a bearish view on Treasurys, threw in the towel earlier this year. But Rogers is sticking to his opinion that Treasurys will eventually fall. "Bernanke is obviously backing the market again and the Federal Reserve has more money than most of us - so they can drive interest rates down again. As I say they are making the bubble worse." The reality is that while Bill Gross has to satisfy LPs with monthly and quarterly performance statements (preferably showing a + sign instead of a -), the retired and independently wealthy Rogers has the luxury of time. And hence the core paradox at the heart of modern capital market trading: most traders who trade with other people's money end up following the crowd no matter how wrong the crowd is, as any substantial deviation from the benchmark will lead to a loss of capital (see Michael Burry) even if in the longer-term the thesis is proven not only right, but massively right. Alas, this means most have ultra-short term horizons, which works perfectly to Bernanke's advantage as he keeps on making event horizons shorter and shorter, in the process killing off any bond bears which unlike Rogers can afford to wait, and wait, and wait.

Tuesday, October 11, 2011

China’s Pan Asia Gold Exchange: A New Playing Field for Speculators?

China Goes To TradeCon 2, Warns Currency Bill Will "Inevitably Lead To Serious Damage In China-US Trade Relations"

In the "no $hit" category, China retaliates against the US currency manipulation bill.

Military Counter-Coup In Egypt? Prime Minister Hands In Resignation Of Government

Reuters headline on Tuesday:
Egypt cabinet spokesman denies report that PM handed in resignation of whole government.
A day later, another headline:

How bankrupt governments will confiscate your gold

Peak Silver and Mining by a Falling EROI

Peak Silver Revisited: Impacts of a Global Depression, Declining Ore Grades & a Falling EROI

Monday, October 10, 2011

Former Fed Chairman Greenspan quote on gold

“Gold still represents the ultimate form of payment in the world . . . Germany in 1944 could buy materials during the war only with gold. Fiat money paper in extremis is accepted by nobody. Gold is always accepted.” - then-Fed Chairman Alan Greenspan, May 20, 1999.

He was responding to then-UK Finance Minister Gordon Brown's decision to sell the Bank of England's gold reserves when gold was priced near its lows, now referred to as "Brown's bottom."

Celente - We are Looking at a Total Global Financial Collapse

Madoff: 'Whole government is a Ponzi scheme'

Missteps to Mayhem

Saturday, October 8, 2011

Harry Markopolis - Bernie Madoff and bank fraud whistleblower

Global Demand for Gold & Silver at Unprecedented Levels

Dutch Secretary of the Treasury answers questions about whereabouts of the Central Banks gold
What is in your opinion the present function of the gold stock? 

DNB’s physical gold holdings function as the ultimate reserve and anchor of trust in times of financial crisis. Further, gold is being held for diversification reasons.
I guess the Dutch Secretary of Treasury doesn't agree with Fed Chairman Bernanke's opinion that gold is merely a "tradition."

Major U.S. Banks At Risk If European Debt Crisis Spreads

Friday, October 7, 2011

Waistreet pro--I'm back

NOT SAFE FOR WORK video.  Please playback only in your mother's basement.

World facing worst financial crisis in history, Bank of England Governor says

Jim Rickards - Who’s the Sucker at the Global Gold Poker Table?

The language in this op-ed from James Rickards may sound familiar to some of you since I correspond with him a bit.  I've often used the poker metaphor.  I just purchased his yet-to-be released book "Currency Wars."  He has a very interesting background, having worked both government and in the private sector capital markets.

Hiding Gold in All the Unusual Places

Euro Plunges On Fitch Double Tap, Comments From Merkel

In another theater of the absurd example, there are analysts out there who are actually claiming they didn't see this coming:  the downgrading of Spanish and Italian sovereign debt by the credit ratings agencies.  Really?

Epic, Grotesquely Surreal Friday Humor

Pretext:  Tier 1 Capital is a measure of a bank's financial strength.  Dexia, rated "best under adverse scenario" in this so-called stress test, just collapsed earlier this week.  You can't make this $hit up.

Note the additional irony that Bank of America organized this event.  Yes, that same bastion of American banking stability.  /sarcasm

Thursday, October 6, 2011

Louise Yamada: Gold, Silver & US Dollar

The Chinese Mean To Control The Global Gold Market

I've been blogging about PAGE for a while.  Here's another article.

IMF advisor says we face a Worldwide Banking Meltdown

Gold’s Still A Great Investment, Says Frank Holmes–The Price Will Double

Brad Meltzer's Decoded: Fort Knox

Madoff Whistleblower Tells KWN Banks Stealing From Pensions

This is what happens when you put the dumbest guys in the same room (e.g. pension fund managers) as the biggest sharks in the room (e.g. investment bankers).  The sharks have used the opacity of markets to surreptitiously steal from the retirement funds.  The concept of "free" markets on Wall Street is fictitious.

Bank of England restarts QE

And the United Kingdom follows suit with QE as well.

Trichet Ends ECB Reign With More QE

If you want more jobs, look to Steve Jobs

Wednesday, October 5, 2011

Announced U.S. Job Cuts Rise 212% From Year Ago, Challenger Says

More bad employment news--just enough to get the Plunge Protection Team to gin up the SP500 futures.  And more reason for Blackhawk Ben to implement QE 3.0.

All half-kidding aside, the blogosphere has rejected the economic cheerleading from the status quo for several years.  Now that the financial elite and complicit media have submitted to the dark truth, rest assured they will put to good use the ongoing financial crisis.

LBMA campaigns for gold to be Tier 1 asset for banks under Basel III

Tuesday, October 4, 2011

Silver, Gorillas, Madoff and Financial Regulators –Will they ever learn?

Not only are markets rigged, but the regulators who are mandated to monitor and enforce laws are not only looking the other way, they are enabling illegal price manipulation.  The markets are completely distorted due to the corruption, and everybody will pay when the COMEX defaults, whether it's the farmer who wishes to hedge his crops, the airline which wants to lock in fuel prices, or the consumer who puts food on the table and drives to work.  And market experts will declare "no one saw it coming."  Bull$hit.

Extreme Increase in Demand for Physical Gold & Silver Globally

Strong hands are buying the dips.  Weak hands are getting shaken out.

Rick Rule - Many Black Swans that Could Hit This Market
“If there is a bid for gold and a hedge fund is having trouble meeting redemptions, they will sell their gold.  How long can this go on?  I don’t know.  Remember this, Eric, in the midst of the biggest gold bull market of all-time, the 1970 to 1980 bull market, when gold went from $35 to $850 an ounce, in the middle of that decade, in 1975, the gold price fell by half....
“Could that happen now?  I don’t think so.  The set of circumstances that caused that market to fall by half was an increase in real US interest rates and a consequent increase in the value of the US dollar.  I don’t see that occurring.
Remember also, in 1975 when the gold price fell from $200 to $100 an ounce, certainly an unnerving event for people who were long gold, in the five years after that gold ran from $100 an ounce to $850 an ounce.  So someone who got shaken out of the gold market, in a cyclical decline, deprived themselves of an 850% escalation over the next five years.

U.S. "close to faltering," Fed ready to act: Bernanke

Hong Kong - Still The Cheapest Place To Buy Gold Coins

Bank Of America Site Down For Third Day In A Row

Does anybody find this slightly disturbing, especially in light of the fact that Bank of America shares are correspondingly tanking to the $5 handle?

Gold? Sure, We’ll Take More of That, Says CME

This further legitimizes gold as a currency, valuable enough to be used as collateral. 
The step is the latest in a string of moves by exchanges and other financial services firms to increase the use of gold as collateral, which essentially places the precious metal in the top tier of asset classes.

"Gold is money.  Everything else is credit." - JP Morgan, testifying before Congress in 1912

"Gold and silver is the only money the elite rely on." - Lindsey Williams

Why Europe Is Right and Obama Is Wrong,1518,789624,00.html

Monday, October 3, 2011

China Fires Back At US Senate Which May Have Just Started The Sino-US Currency Wars

It didn't take long for China to respond to the US Senate passing an anti-currency manipulation bill.

Is The CME's 150% Hike In Gold Collateral Just A Ploy To Increase Amount Of Legally Confiscatable Gold?

James Turk - This Collapse is Bigger than Governments or CB’s

Battered gold bugs still defying bear raid

All that's gold doesn't glitter

Gold bugs 1 - Fareed Zakaria 0.

In order to present the "balanced" perspective, I have included Zakaria's misguided op-ed on the price of gold.  God help him.

I will gladly exchange my can of beans for his gold coins.  The sad part is millions of Americans will listen to this "expert" and subsequently witness their savings get completely annihilated.

KWN Exclusive: Martin Armstrong - Gold’s Next Move

Bank Of America Locks Out Its Online Clients For Second Day In A Row

Is this a mini- bank holiday?

Four Biggest Banks in America have Huge Leverage

Banking crisis set to trigger new credit crunch

Nomura Explains Why Gold Went Down, And Why It Is Going Back Up
We have seen that gold’s recent fall has been accompanied by heavy deprecation in Asian hours. This contrasts with relatively robust Asian price action during earlier periods of gold weakness in May and August. We think that a reversal of this trend back to gold appreciation in Asian hours is the key to a short term reversal and we have begun to see this in recent days. We also find that the correlation between risky assets and gold has been higher than usual in recent weeks. Hence, we suggest that heavily extended speculative net long gold positions have unwound to free up cash for other losses in risky assets, like equities. With short-term speculative positioning net longs at relatively low levels, it is likely that fundamentals, as opposed to positioning, are likely to drive the price of gold again.

We continue to view long-term fundamentals, such as low real rates and the relative cheapness of gold when viewed from an Asian perspective, as bullish for gold. At the same time, gold’s attractiveness as a tail-risk hedge against the continued uncertainty in Europe is likely to be another factor that should support the price of gold in the short term.

Qatari wealth fund plans $10bn gold buying spree

Saturday, October 1, 2011

Gold price suppression is 'conspiracy theory' only to those who won't look at facts

California breaks from 50-state probe into mortgage lenders

Good for Attorney General Harris for standing up for Californians.  However, it won't matter, because if banks collapse, nobody wins in the short-term.  Long-term perhaps, but the immediate effects will be extremely painful, even if necessary.