By: Julian D. W. Phillips, Gold/Silver Forecaster - Global Watch - 17 July, 2009
Suddenly the pressure from China to change the world’s monetary order is pressing. At the G-8 China asked for the forum to debate proposals for a new global reserve currency! They were largely ignored! China’s rising presence in the global economy [$2 trillion reserves now] and the threatening weakness of the $ is prompting China to act in this way and with speed. Full Story
Gold started the summer doldrums looking strong and has retreated since, but what are its prospects for the rest of the year and beyond? That will largely be determined by the interplay between supply and demand; let’s take a look at the supply side. Full Story
By: The Gold Report and Michael Berry - 17 July, 2009
Unlike many of his colleagues in the world of investment analysis, Discovery Investing pioneer Dr. Michael Berry doesn't expect inflation to enter the economy for two or three years, after considerably more deleveraging takes place and real recovery begins. In this exclusive interview, he tells The Gold Report this is a great time for contrarians to do some bargain hunting. Full Story
By: Peter Schiff, Euro Pacific Capital, Inc. - 17 July, 2009
The health care bill unveiled this week by the House of Representatives (with the full support of the Obama administration) is one of the worst pieces of legislation ever drafted. If passed, it will reduce the quality and increase the cost of health care in America. But more importantly, it will severely undermine our already weak economy. Full Story
The HUI would have to rise nearly 50% to reach its all time high. Yet, today key input costs are lower and the price of Gold in most currencies is higher today than in March of last year. These positive developments bode very well for gold sector earnings over the next several quarters and for share prices of course. Full Story
By: Adam Hamilton, Zeal Intelligence LLC - 17 July, 2009
Commodities have had a rough go lately, especially before this week. You couldn’t open a financial newspaper or turn on CNBC without seeing endless bearish prognostications for raw materials’ prices. Ongoing global economic fears led to the widespread belief that commodities are doomed to grind lower. Full Story
By: Daniel Aaronson and Lee Markowitz - 17 July, 2009
The BRIC countries do not need to lend funds to the IMF to gain a greater voice within the global financial community – they already have everyone’s full attention. Instead, we are speculating that these nations, all large holders of Dollars and Treasuries, cannot possibly sell out of those positions and are becoming increasingly nervous about what they own. Full Story
The significance of the Assistant U.S. Attorney’s statement at the Bail Hearing for the former Goldman employee, Sergey Aleynikov, who was charged with stealing Goldman Sachs trading software, goes far beyond the issue of the alleged theft. Full Story
Very few these days have put their hope in the white metal. Far more have put hope in the yellow one. But most put their hope in what they believe the new administration will bring back—the American dream. Basically, their hope rides on a system that in times past has always failed, whether it was born in China, Germany, Argentina, or whatever nation state, it did not matter. Full Story
With the former Investment Banks being granted Commercial Banking status due to the unfolding financial crisis in late 2008 – it was widely reported in the mainstream financial press that this “change” would mean that these banks would be subject to more oversight and hence, more transparency would result regarding their derivatives activities. Ladies and gentlemen, nothing could be further from the truth. Full Story
China is a completely different world and the way of doing business there clashes with traditional Western practices. If the West’s great contribution to humanity was the rule of law then the East’s great contribution is bureaucracy. Full Story
Leverage, greed, fear and confusion are now the order of the day. Stock markets will be prone to panics and the volatility will be extreme for many years. The gold market will benefit from this but will also be very volatile. Full Story
“How can I make a lot of money in this market?” That’s the question I wake up to every day. Sometimes it’s a real thinker, especially in bear markets. Other times, when there’s a genuine bull market, it’s a lot easier. Right now, we don’t have either one. We have a flat market. And we will continue to have a relatively flat market. Full Story
By: The Energy Report and Art Smith - 17 July, 2009
The outlook for oil seems to be brightening amid scant new reserve discoveries and declining reserves at the world's large oil fields. "We believe we're in a fundamentally positive market for oil in the 21st century," says Art Smith, president of Triple Double Advisors, who anticipates oil moving back into the three-digit price range within three to five years. Full Story
My view in the published editions of the Goldsmiths is very similar to the wisdom of Bellinger. I am certain that the trouble is coming and I can’t perceive any way that the United States can avoid it. After all, the cause has involved US financial and monetary policies since the establishment of the Federal Reserve Bank in 1913. Full Story
By: Richard Daughty, The Mogambo Guru - 17 July, 2009
I try not to think about silver, because when I do, my head ends up whirling around at the sheer compelling nature of the fundamentals, and I always come to the conclusions that whirling makes me dizzy and that I need to buy more silver right away because silver is going to start exploding in price over the next few years... Full Story
Just because there are a dozen great reasons to hate stocks right now doesn’t necessarily mean they can’t go much higher. Not only that, the bear rally could continue for quite a while – till 2011 and beyond, even – without distorting the bearish look of the long-term charts one bit. Take a look at the monthly chart below, which shows ten years’ worth of price action in the S&P 500 futures. Full Story
By: Bill Bonner, The Daily Reckoning - 16 July, 2009
The monsoons came to an end yesterday afternoon…more below… In the meantime, the Financial Times, on the final page of the first section, reports the big news: “China…is back in bubble land.” After the expansion comes the contraction. After the bubble comes the clean-up. After the storm comes the sun. Full Story
The globe is losing patience with leadership and management of the USGovt ship at sea. They simply refuse to offer a credible solution to the primary keynote crack in the hull, falling housing prices and cratered mortgages, each of which work their destructive magic to wreck the banks. Full Story
Before the House Oversight and Government Committee, Former Treasury Secretary Henry Paulson admitted pressuring Bank of America to go through with plans to buy Merrill Lynch. Highlights from the testimony are enclosed here. Full Story
Representative Jim Jordan had probably the best five minutes of allotted time with former U.S. Treasury Secretary Henry Paulson before a House of Representatives Oversight subcommittee this morning. Clips of the testimony are not yet available, but here is an interview with Susan Swain in which Jordan discusses the Oversight hearing and his thoughts on the Bank of America/Merrill Lynch deal. Full Story
Traders with long experience of bear market rallies inform me that it is usual to see a final spike at the end of a long rally like the one we have had since the lows of March. Is that what we are now seeing in US stocks? This is summertime and trading is very thin but the sudden upward moves in the S&P look like a last hurrah. Full Story
By: John Browne, Senior Market Strategist, Euro Pacific Capital - 16 July, 2009
Last week, major banks announced they would no longer offer cash for the IOU's written by the state of California. At the same time, China proposed that the U.S. dollar be replaced as the world's official reserve currency. Although seemingly unrelated, these two developments have at their root the same issue: uneasy creditors. Full Story
By: Doug Hornig, Editor, Casey Research - 16 July, 2009
It’s possible that no concept in history has ever come so far, so fast, and with so little substance behind it, as “global warming.” Or, to be precise, anthropogenic global warming (AGW) – the kind caused by us puny humans rather than by that fireball that keeps the planet habitable. Full Story
By: Peter Schiff, Euro Pacific Capital, Inc. - 16 July, 2009
As you may know, I am seriously considering seeking the Republican nomination for U.S. Senate in Connecticut, and I’ve launched www.SchiffForSenate.com to help me gauge support for my candidacy. Full Story
The Dow Industrials lurched 256 points higher yesterday, but a trader looking for action might have found himself bored to tears nonetheless. Indeed, anyone who failed to go home long the day before would have been left twiddling his thumbs Wednesday morning, since stocks bolted for the wild blue yonder on the opening bell. Full Story
From the Wall Street Journal's 2009 guide to the crisis starting two years ago...to new BBC drama, set "when the bubble was yet to burst"...it doesn't matter. Whatever you want to call this on-going crisis (and the Great Depression didn't get its name until perhaps 1934), it was plain to see ahead of Bear Stearns' collapse and the Lehman's failure. Full Story
By: Bill Bonner, The Daily Reckoning - 15 July, 2009
Our faith is weakening. That is, our faith that the government will be able to cause inflation, sooner or later. Let’s review our own narrative: deflation now, inflation later. Full Story
The most notable decline of the past week or so has been in the price of crude oil. As noted by us and most others, oil’s gain hadn’t been justified by supply-demand concerns. The gains have been a currency trade against the Dollar that ran out of steam with the passing of Q2. US regulators at the Commodities Futures Trading Commission are mulling over limitations on funds going into the energy sector. The CFTC is rarely heard from, and it seems only when prices are on upward trajectories. Full Story
By: Bob Chapman, The International Forecaster - 15 July, 2009
Last week the Dow fell 1.6%; S&P fell 1.9%; the Russell 2000 fell 3.3% and the Nasdaq slipped 1.8%; cyclicals fell 3.6%; transports 1.5%; consumers 1.6%; utilities 1.4%; banks 2.3% and broker/dealers 2.8%. High tech fell 1.8%; semis 1.8%; Internets 2.1% and biotechs 2.7%. Gold bullion fell $19.50 and the HUI gold index fell 8.4%. Full Story
If the second half of this year is only one-tenth as volatile as the first half of the year…buckle up! The way it’s shaping up the markets are in for a stressful trip on a windy road. This can be good or bad though. Full Story
I am bullish on gold. I am certainly not telling readers to be bearish on it. I am simply asking you to be aware of the potentials for its price, both to the upside and the downside and of the timeframes that are likely. It is a good bet that when gold finally does launch for real, it will do so without some of its most would-be ardent believers aboard. It will launch amid fear and agony. That's the way this market works. Full Story
I keep coming back to this theme because the non-Keynesian, hard-money deflationists keep pitching the same old deliberately deceptive statement: "Gold's price rose in the Great Depression." They tell their readers to buy gold. Full Story
The idea that we’ll wake up one day to discover that the international monetary system has been “reset” and that our dollar/euro/yen savings have taken a huge hit (while the local currency value of our gold and silver soar) reminds me of an exchange in The Virgin’s Lover, by Philippa Gregory (yes, I like historical romances). Full Story
By: Richard Daughty, The Mogambo Guru - 15 July, 2009
To show you the kind of idiocy that passes for economics, The Wall Street Journal, in a story about the imminent rise in the minimum wage from $6.55 to $7.25 an hour, notes that the Economic Policy Institute “estimates that the minimum-wage increase will add $5.5 billion to the economy” which makes me laugh – Hahaha! – in a mocking-yet-scornful way as my humble way of saying, “These guys are idiots!” Full Story
By: The Gold Report and Peter Grandich - 14 July, 2009
Agoracom market analyst Peter Grandich, who isn't among those who expect the world at large to emerge from "this absolutely horrific downturn" by year-end, instead sees good opportunities on the horizon for investors who want to "buy things on the cheap" because prices will fall in the equity markets. Full Story
A few weeks ago I drew your attention to the ‘golden cross-overs’ that have been showing up in so many charts. These cross-overs (where the 50DMA move into positive alignment with the 200DMA), are still intact, and continue to progress. Full Story
By: Bill Bonner, The Daily Reckoning - 14 July, 2009
“America is beginning to consider a new stimulus program,” said Irish television last night. It was a rainy day in the Emerald Isle yesterday. The wind was blowing. Rain was coming down. By 7pm, it was time for a pub and a drink. The Irish know what to do in the evening… Full Story
Every once in a great while, something big comes along to upset the status quo. Sometimes the change is long overdue and welcome. I think we may soon witness such a game-changer in silver. As I briefly referenced last week, the new chairman of the CFTC, Gary Gensler, issued a statement on July 7, that I felt was very important. Upon further reflection and subsequent additional statements from Commissioner Bart Chilton, I am convinced that great change may be on the way. Full Story
As the table below depicts, commodity related stocks and their associated warrants are wasting little time recouping the major losses they incurred in 2008 and are already up 30% and 74%, respectively, YTD, even though they are currently suffering from the summer doldrums. Full Story
Some might be reminded of the Abbott and Costello routine of ‘Who’s On First’ with this line of thought, but this is not the intention. The intention behind this line of thinking is to explain why stocks can go higher from here despite negative fundamental and technical underpinnings supporting them at present. Full Story
Gold is the primary tangible monetary asset because of the large above ground stockpiles. It is primarily produced to be hoarded not consumed. The other quasi-monetary commodities are silver, platinum, palladium and copper. The role of the precious metals will be markedly different in the Information Age than during the Industrial Age. Full Story
US Treasury Secretary Timothy Geithner arrives in the Persian Gulf this week to reassure Arab states that their dollar assets are safe. Yet he will find himself largely preaching to the converted. Arab central bankers are pragmatic folk, and the first question they ask about abandoning the dollar is what is the alternative. It is a fair point. Full Story
Let’s be honest, these are very challenging times to be an investor. Regardless of all of the positive spin from CNBC and from many newsletter writers and analysts this has not been the best of times to be ‘in the game’. Full Story
Interview with Adrian Douglas, propriateor of marketforceanalysis.com. A complete discussion on the Gold and Silver market, with some mention of a few other markets towards the end. Visit marketforceanalysis.com Full Story
July 24, 1998, was an epic day for the global financial system. In "The Money Matrix - Bring Light to Dark Derivatives! (PART 11/15)," we reviewed the consequences of FED Chairman Alan Greenspan's decision to allow negotiation of OTC derivative contracts without the use of an exchange to make transactions transparent and reduce counterparty risk. Full Story
Is your portfolio prepared for the “new normal” economy? In May, Mohammed El-Erian issued a fairly gloomy forecast for the world economy. The CEO and Co-CIO of PIMCO, a firm which manages $700 billion in assets, said the world economy has entered a “new normal” state. Full Story
By: Richard Daughty, The Mogambo Guru - 14 July, 2009
California has so degraded itself into a laughably Leftist socialist/commie-think nightmare that they have, as all socialist/commie-think countries always do, finally bankrupted itself. As Margaret Thatcher, erstwhile prime minister of England, once said, “The problem with socialism is that you eventually run out of other people’s money.” Hahaha! Exactly! Full Story
By: Dr. Ron Paul, U.S. Congressman - 13 July, 2009
Last week I was very pleased that hearings were held on the independence of the Federal Reserve system. My bill HR 1207, known as the Federal Reserve Transparency Act, was discussed at length, as well as the general question of whether or not the Federal Reserve should continue to operate independently. Full Story
“I think we're going to have some of the worst inflation, with all the printing presses around the world running 24/7.” That’s what leading contrarian investor David Dreman said in an interview two weeks ago. Now, I know what you’re thinking, classic inflation hedges have fallen out of favor. Precious metals stocks have taken a beating over the past few weeks. And deflation, not inflation, is the fear du jour. Full Story
The Summer* doldrums are upon us with many investors more interested in the weather forecast than the markets. Although the Summer vacation period is often a time of drift in the markets for obvious reasons, there are exceptions like August 07, when the sub-prime crisis erupted, forcing many brokers to put down their champagne glasses and make a hasty retreat from the beach - and the lighter trading volumes at this time of year make it even easier for big money to steamroller the little guy. Full Story
The FRN$ illusion is under increasing pressure. In The Age Of Turbulence Alan Greenspan wrote on page 483, “But the dysfunctional state of American politics does not give me great confidence in the short run. We could instead see a return of populist, anti-Fed rhetoric, which has lain dormant’. Despite receiving no significant coverage in the evaporating government managed press Ron Paul’s bill to audit the Federal Reserve, H.R. 1207, has attracted 260 cosponsors. Full Story
Gold bugs went to the wall on Wednesday as the price of gold dropped just shy of 20 points. What to do? Is this the tail end of a decline (and a time to buy)? Or is it the start of a bigger decline (and a time to sell)? A great deal rides on the answer to this question, and this is the question I address in the One-handed Economist of July 10, 2009. Full Story
By: Bob Chapman, The International Forecaster - 13 July, 2009
The world is looking aghast at the dollar as the Treasury runs short of money to fund its deficit beyond revenues of $1 to $3 trillion and as the Fed monetizes trillions of dollars. What would you think if you had 64.5% of your foreign exchange in US dollars? That is almost $1.8 trillion. Some of these buyers have ceased buying and if that continues interest rates will head higher and the cost of carrying such debt will increase. As a result the dollar, of course, would move lower. Full Story
After 18 months of the GFC, repeats of repeats of Two and a Half Men there is a welcome change occurring in the junior mining companies on the ASX. Finally we are seeing recognition on the scoreboard for exploration hits but there is also just a hint of near-ology starting to appear. Full Story
By: John Mauldin, Millennium Wave Advisors - 13 July, 2009
There is no doubt that the US is in financial trouble. Those talking of a strong recovery are just not dealing with reality. But the US is in better shape than a lot of countries. This week, we begin by looking at Japan. I have written for years about how large their debt-to-GDP ratio is, yet they keep on issuing more debt and seemingly getting away with it. Full Story
For several months, there have been news reports of announcements by bureaucrats in China and politicians in Russia about the need for a new reserve currency to replace the U.S. dollar. One suggestion: substitute the non-currency known as the SDR (special drawing rights) of the non-governmental, non-central bank IMF (International Monetary Fund). Full Story
By: Richard Daughty, The Mogambo Guru - 13 July, 2009
Total Fed Credit went down by $9.6 billion last week, which is, in comparison to their wild excesses of late, not that much, and certainly nothing to get excited about. Sort of like how my boss is unimpressed that she only got one letter last week, instead of the usual five, from disgruntled customers complaining about how I called them “morons” because they were not buying gold and silver in response to the government acting like monetary and fiscal idiots. Full Story
(Following is the third installment in a series of articles by Chuck Cohen, a seasoned and highly successful investment consultant from New York City. We will be featuring Chuck’s thoughts regularly at Rick’s Picks in order to expand our coverage, in particular, of junior mining shares, a core area of his expertise. In the coming weeks, Chuck will take up the topics of gold as a core investment, and gold as a speculative vehicle. Today he discusses gold’s usefulness as insurance against financial calamity. RA) Full Story
In the recent two Premium Updates I briefly discussed inflation and its effect on gold prices. I showed a chart indicating the massive increase in the amount of money that had been recently pumped into the system. I’ve looked deeper this past week into the issue of inflation researching what some of the smartest people have to say on the subject. Full Story
Gold only fell 1.78% for the week, however the shares were absolutely hammered in comparison to the miniscule gold correction. I am nearly fully invested now, waiting for the imminent gold move up. Something big is coming soon and the danger of being out is greater than being in. Full Story
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