The gold market has been typically quiet this summer. Whether or not the typical autumn surge will follow, who can say? But hedge funds have trimmed their futures position, and London dealing volumes have shrunk, along with volatility. If the gold market were re-loading its gun, ahead of a fresh crisis of confidence in everything else, it would choose just those bullets. Full Story
Last week’s essay centered on the fact that America has borrowed nearly $12 trillion dollars yet achieved very little, if any real economic growth in the last half century. If that wasn’t alarming enough, this week’s effort should suffice to turn some heads. While last week we used the broadest monetary aggregate M3 to discount GDP, this week we’re going to take a look at velocity of circulation in the M2 aggregate and translate that into some logical conclusions. Full Story
By: Andrew Mickey, Q1 Publishing - 21 August, 2009
As we’ve discussed in the Prosperity Dispatch, there are a few rules, however, which can be used in any market. Below are 10 rules developed by Bob Farrell who rose to the chief market analyst spot at Merrill Lynch during his 25 year career. The rules, although developed years ago, seem tailored for the current market conditions (Pay close attention to #8 – describes what is happening right now perfectly). Full Story
The Fundamentals for Gold and Silver have rarely been more bullish. Peace has not “broken out” in many places in the world. The Economy and Markets are awash with Fiat Currencies and Debt. And the continuing increase in Money Supply (M3 still increasing at about 5% -- see below) and Debt shows no sign of abating. Full Story
By: Peter Schiff, Euro Pacific Capital, Inc. - 21 August, 2009
If these proposals seem ridiculous, it is because they are. But they are no less ridiculous than the "Cash for Clunkers" program that inspired them. All are examples of the "broken window" fallacy of economics, which argues that economic activity can be stimulated by the need to replace something that has been destroyed. Full Story
By: Adam Hamilton, Zeal Intelligence LLC - 21 August, 2009
Silver’s fundamentals offer plenty of reasons to be bullish in the coming years. Relentlessly growing global investment demand coupled with reduced production is a recipe for much higher prices. With something like 3/4ths of all the silver mined globally being merely a byproduct, primarily of base metals, supplies will remain constrained. Investors will have to compete in a tiny market for this scarce metal. Full Story
Are you worried about your investment portfolio because of last year’s poor returns and are you now wondering what to do going forward? If you are concerned, you are not alone. Investors are so terrified of the markets they are willing to put their money into bonds and receive next to no interest, just so they don’t continue to lose their investments principle. Full Story
By: David Morgan, Silver Investor - 21 August, 2009
Recently it was announced on a Chinese news service that silver bullion is now being offered to the Chinese public. Please note this is a very small operation and at this point none of us knows if this will really catch on with the Chinese investing public. Full Story
By: Bob Chapman, The International Forecaster - 21 August, 2009
Many things affect markets. Other markets, superfluous liquidity, fiscal and monetary policy, and public perception. Professionals are the first to react to changing conditions. We must not, of course, leave out the negatives, such as staggering climbing unemployment, foreclosures, bankruptcies and a general malaise, which temporarily is being offset by greatly loosened monetary conditions. Full Story
While LEAP may or may not be right on the dollar by the end of summer, it has to be significant that some of the most informed players in the world on the work of the Rothschild Cabal has stopped its daily purchases of dollars and possibly US bonds as well. This is a clue that the Bank of Israel may be getting some Rothschild insight on which way to move. Right now, the future doesn’t look good for the US dollar and bonds. This will translate to better days for gold, silver and commodities in general. Full Story
By: Richard Daughty, The Mogambo Guru - 21 August, 2009
The Economist magazine had the Buttonwood blog titled “Law of Easy Money”, which immediately gets your hopes up that there is such a thing as “easy money”, which actually exists (just ask Connecticut’s Senator Chris Dodd!), but unfortunately not for guys like you and me who don’t have the political power and grease to extort money and skim taxpayers... Full Story
Here’s economic ignorance at its most aggressive, blazoned atop the front page of Wednesday’s Wall Street Journal: “Reluctant Shoppers Hold Back Recovery”. So there you have it. If only we would all make a beeline for the mall and shop-till-we-drop, just like the good old days, then we would have the kind of recovery that warms economists’ hearts. Full Story
Every few months a chart comes along that needs almost no follow-on paragraphs to make the point of the issue. The chart provided by CIGA Eric covers several important types of US$-based bonds, their inflow and outflow, and the aggregate GrandNet. The financial data is publicly available from the USGovt TIC Reports. The messages are clear. Inflows of foreign funds are dwindling. In the case of USAgency Mortgage Bonds and USCorp Bonds, the nation is witnessing something unprecedented, the net outflow of funds. This is outright rejection. This chart exposes the isolation problem of the USDollar in the bond world, clearly the most important market beneath the currency market. The printing press is the last option. Full Story
Prices in August have run high enough to have taken out the high gold made in July. Unless July’s low of 904.8 is taken out, the seasonal chart formation above remains intact and favors an advance in gold later this year. Full Story
Here is a regulatory development update. Yesterday, the Commodity Futures Trading Commission issued a statement that it was pulling the exemption from position limits from two entities trading wheat, corn and soybean futures. The exemptions were previously granted back in 2006, via “no-action” letters. Full Story
Human history is the history of individuals. Individuals can form groups which can be later remembered by their group name, but individuals make up all groups. The history of humans can be examined from the point of view of the individual and more importantly by the condition of the individual measured by values broadly applicable to all individuals. Full Story
As we discussed in Tuesday’s MarketMinute, a symmetrical triangle has emerged in the spot gold market since the last probe above $1,000 back in February. As the apex of the triangle is approached, an eventual breakout becomes more and more imminent. Full Story
Our gold standard money didn’t fail us in 1913; it was murdered. Did it deserve to die? What was its crime? It had provided us with nothing less than relative peace and prosperity over a span of 136 years. It had not only retained one hundred percent of its value, it had gained eleven percent. That’s right. The dollar we started with in 1776 bought us eleven percent more after almost seven generations. Then, J.P. Morgan’s creatures picked a quiet 23rd of December in 1913 to suffocate our sound money system. Since that manslaughter, the purchasing power of a dollar has plummeted over 95%. We now pay twenty times more than J.P. Morgan did for any item. Full Story
Everyone is talking about gold shooting to the moon because of the massive reverse head & shoulders pattern forming, not to mention the economy isn’t as good as some of us would like it to beJ. I put together this quick report to show the bearish side of things for once. Full Story
You have got to be kidding me! Net buyers aren't counted as demand because traditionally they are sellers! That is just the most contrived reporting to come up with the negative gold news GFMS always wants to produce. This means that the change in demand from the central banks, going from selling a net 69 tonnes to buying 14 tonnes, is a positive difference of 83 tonnes. This means that global demand for gold increased by 2 percent, instead of declining 8.6 percent. Full Story
By: John Browne, Senior Market Strategist, Euro Pacific Capital - 20 August, 2009
Despite growing concerns about the growth in Federal spending, voiced this week by none other than Warren Buffett, Washington seems determined to keep its foot on the money pumping accelerator for as long as it can. But even though Washington continues to ignore the realities, alarm bells are beginning to ring at town halls across the country. Full Story
By: Andrew Mickey, Q1 Publishing - 20 August, 2009
The most powerful people in the financial world are doing anything they can to prevent it. Central bankers fear it. CEO’s hate it. Banks get destroyed by it. Don’t worry though, they have banded together to beat it…at any cost. And you can rest assured, they will beat it. As for the costs, well, that’s a problem for tomorrow. Full Story
By: Richard Daughty, The Mogambo Guru - 20 August, 2009
July’s 0.1% fall in sales at US retailers has been termed “unexpected” for some reason that I don’t understand since wages are not rising, unemployment is rising, consumer price inflation is rising, consumer debt is not rising and equity withdrawals are not increasing. So if retail sales had increased, where would the consumer have gotten the money? Full Story
We popped up on the “wrong” side of the inflation/deflation argument here the other day with a hyperinflation scenario that seems to us not just possible but likely. Although we hold fast to a prediction that deflation is going to run its course, throwing tens of millions of Americans into bankruptcy, before relief comes to debtors, we are persuaded that at some point well down the road the U.S. will throw the switch to hyperinflate. Full Story
IT'S NOT OFTEN that Sweden gets to lead the world. Saab mimicked BMW. Ericsson improved on Motorola. Abba took The Carpenters and added a hi-hat. In monetary matters, however, Sweden remains an occasional trail-blazer. Full Story
Sweeping losses under the rug is nothing new on Wall St, but it’s getting worse. S&P 500 P/Es range from 16 – 134, depending on which earnings methodology you use. The first number is based on “operating earnings”, and the second is based on the real bottom line. Full Story
In America, a land of plenty, the economy is in the gutter, incontinent government spending is coupled with out of control budget deficits resulting in ballooning debt, bankrupt States, skyrocketing unemployment with benefits ending is compounded with manic-depressive politics while commercial real estate is imploding, earnings of publicly traded companies are cratering, the remaining liquidity in the financial markets is illusory from the likes of program trading via Goldman Sachs and there is a new weekly event called ‘bank failure Friday’ with the FDIC now bankrupt and would be insolvent but for its line of credit with the Treasury. Full Story
Ron Paul's new book, End the Fed (out next month) illuminates the real reasons behind America's recent stunning economic collapse. The Federal Reserve would just as soon you not read it, and instead believe the standard refrains from the standard economists (including those at the Fed): "No one saw it coming! How could anyone have predicted it?" Full Story
The deal between the IRS and UBS apparently requires the latter to hand over thousands of names of U.S. citizens. It’s a safe bet that hundreds of those are major donors to the campaigns of the politicians currently running the country -- and a few dozen are the politicians themselves -- which creates some amusing moral dilemmas for the enforcement folks and the media. Full Story
By: Richard Daughty, The Mogambo Guru - 19 August, 2009
Bloomberg had the story about how “The global financial crisis has blown a hole in the ‘efficient markets’ theory on which modern economics and modern finance have been based, said Richard Thaler, a professor of economics and behavioral science at the University of Chicago. Full Story
I thought I’d overdosed on the inflation vs. deflation debate, but that was before I started reading Adam Fergusson’s When Money Dies: The Nightmare of the Weimar Collapse. Fascinating stuff. Anyone who thinks it couldn’t happen here is right in one respect: It won’t take ten years to play out in the U.S., as it did in Germany. Full Story
By: Dr. Ron Paul, U.S. Congressman - 18 August, 2009
Since the bailouts last fall, lawmakers have been behaving as quasi-owners of the bailed-out banks and businesses, leading to calls for increased regulation of executive compensation and other wasteful expenditures. We have heard much about bonuses and executive pay packages that sound more like lottery winnings than an honest salary. Full Story
By: The Gold Report and Carmel Daniele - 18 August, 2009
In 2007, she claimed the current commodities super-cycle would last another 20 years. But given the economic implosion since that time, could it still be true? "Absolutely," says Carmel Daniele, founder, CEO and CIO of CD Capital. "The crisis that occurred last year after Lehman's collapse just interrupted the cycle," she explains, adding that it "is actually going to seal the next stage of the super-cycle. Full Story
By: Doug Casey of The Casey Report - 18 August, 2009
I recognize that I’ve antagonized many subscribers over the years with “Bush Bashing.” In January, just after OBAMA!’s election, I said I wouldn’t mention Bush again, his departure having made him irrelevant. I only feel bad that he and his minions will apparently get away scot-free with their crimes; better they had all been brought up before a tribunal and tried for crimes against humanity in general and the U.S. Constitution in particular. But that is objectively true of almost all presidents since at least Lincoln… Full Story
The biggest problem that most economists and analysts fail to comprehend when making forecasts and predictions on the US Dollar, Precious Metals, Financials or the whole Economy in general, is the ability to get to the Root of the Problem. Most of them are using information and methodologies that are either outdated, superficial or completely worthless. Those economists who are either Keynesians or Monetarists are living in a economic model that will have a life expectancy of less than a century. Indeed, a blip in the history of mankind and increasingly worthless going forward into the 21st century. Full Story
The chorus singing of the need to separate commodities from broader views of market movement appears to be growing again. It’s possible to separate this into “supply constraint” and “Asia rising camps”, but in general it is recognized that both come into play. Full Story
The time has come to take action. The frequency trading, front running, quasi-derivatives, insider trading and wanton naked short selling make a mockery of our markets. They make Mr. Madoff look like a Saint. Everyone knows it. Who will be left to trade at the end of this? Full Story
What Hamilton and most people overlook in analyzing central bank gold sales is that they are a farce that beats the best Monty Python sketches. The central banks have printing presses and now computers that can generate loads of fiat money. It is beyond side-splittingly funny that we should take central banks seriously that they need to sell gold in exchange for the stuff they manufacture for free. Full Story
Given the currently low level of the VIX, optimism among paper asset investors has been converted to outright enthusiasm. The world has been saved, according to many of these enthusiasts, and now unlimited and happy growth awaits us. Full Story
By: Richard Daughty, The Mogambo Guru - 18 August, 2009
I think that Paul Krugman is one of those absurd guys that has no idea what in the hell he is talking about and who owes his undeserved prominence to being a real butt-kissing sucker-upper to Alan Greenspan and his Federal Reserve, and now he’s doing the same thing to the laughable Ben Bernanke and his disastrous Federal Reserve, although I will admit that I don’t know why anybody listens to this guy. Full Story
If Gold quotes were to fall now by another $50, we’d still be unconcerned. Specifically, the December contract would have to plummet all the way to $809 to turn the daily chart even mildly bearish; it settled yesterday around $936. Similarly, although September Silver got hit hard, falling 72 cents, or five percent, it would have to drop a further 15 percent, to 11.826, to raise a red flag. Full Story
By: Gary Dorsch, Editor, Global Money Trends - 17 August, 2009
Bullish investors betting on a V-shaped recovery for the global stock markets are convinced the worst of the global economic crisis is over, and furthermore, expect the emerging economic giants, - Brazil, China, India, Russia, and Korea, (BRICK) to become the locomotives of global growth. With China and India leading the way, the notion of decoupling, - emerging markets advancing faster than developed markets, - and even pulling the G-7 economies out of recession, is making a comeback. Full Story
The Commodities Futures Trading Commission (CFTC) wrapped up its hearings on whether to install position limits on futures trading this week, and like other hot topics being tossed around Capitol Hill, misinformation seems to be running rampant. Full Story
By: Nassim Taleb, Nouriel Roubini, and the "Squawk Box" Crew - 17 August, 2009
Nassim Taleb, principal of Universa Investments and author of 'The Black Swan,' discusses, the markets, the economy and whether Fed Chairman Ben Bernanke should be reappointed. Full Story
Forced mutual, pension, and hedge fund related buying could push equity prices higher in coming days, however if our views on the dollar $ are correct, any such buying should be fleeting, possibly even ending today if overnight reversals in various key stock markets have any predictive value. Full Story
Gold's bulls and bears have fought each other to a standstill so that an eerie calm now exists in the gold market, rather like the period in Europe known as the Phony War which was an early stage of the 2nd World War, where despite having declared war on each other, the major powers did not engage in significant military operations. Just as this phase was the "calm before the storm" it is clear from an examination of the gold chart that this time of tranquillity is about to end - that much we can be fairly sure about. Full Story
This title should also read “and why gold equities will fly”. At GoldOz we have successfully predicted the Price of Gold (POG) movements on a fairly regular basis the past few years. This is a bold statement backed up by public record. The long consolidation patterns in the POG in between the strong up-legs have been quite regular since 2002. The extent of each price rise has been harder to predict however so we steer clear of this claim and prefer to follow the market until it “feels” and acts like a top. Full Story
THE BIG MONEY IS MADE IN THE BIG MOVE. This is true, dear gold bug. The big money is made in the big move. When Edward Land was putting Polaroid all over the charts back in the 1950s and ‘60s, traders watched it in awe. They didn’t buy, but they watched it in fascination. Full Story
In short, it is the height of idiocy to take a 5-month snap-shot of market activity and contend that big new bull market is born, especially when the 5-year snapshot noted in the first paragraph turned out to be little more than an unsustainable cyclical bull fueled by unprecedented asset/credit bubbles. Given the potentially transient and/or unsustainable forces uniting to stabilize the U.S. economy, common sense leads to one conclusion: today’s rally is a cyclical bull inside of a secular bear. Full Story
Economic cycles of expansion and contraction are the inevitable result of central bank credit flows. So, too, are deflationary depressions and hyperinflations. Though far less frequent, the destruction caused by deflationary depressions and hyperinflations more than make up for their infrequency; and, today, after perhaps the longest absence of each in recent history, we are now about to experience both—perhaps this time in tandem. Full Story
Switching some of one's savings into physical (not paper) Gold now, while it can still be readily found, provides insurance against what is now an almost unavoidable future currency debasement event. Only the timing is still unclear in my mind, but you can bet that such an event won't be announced in advance and you won't be able to find physical Gold as a retail investor when it happens. Full Story
I hope everyone had a great weekend and is now ready for another week of trading. I have put together a few simple charts to show you what we could see with prices in the near term. While I do not predict future price movements (because it is impossible to always be correct), I do like to know what could happen and be ready to take action when something significant occurs. Full Story
The technical situation in the gold and silver markets is still positive. However, two key drivers of PM prices are now vulnerable to a strong move in either direction. The odds favor the continuation of the previous down trend in the U.S. Dollar, but this is not a sure thing. Full Story
Although we had vowed to let the by-now tiresome inflation vs. deflation debate simmer for a while, it came to an unexpected boil last week after some provocative comments were posted by “Senor Cuidado” in the Rick’s Picks forum. Like us, the Senor finds it difficult to imagine how all of those printing-press dollars the banks are currently sitting on will find their way into the consumer economy. Full Story
1st Hour: Headline news & The Market Weatherman Forecast. Spotlight Stock Picks. Host, Chris Waltzek & The International Forecaster discuss Superstar Investors & answer listener's questions. 2nd Hour: -Gerald Celente, Trends Research Institute Full Story
By: Julian D. W. Phillips, Gold/Silver Forecaster - Global Watch - 16 August, 2009
In this the second part of this series we look at the big global picture when President Roosevelt’s Administration confiscated the gold of U.S. citizens. Based on this part, in the next part we contemplate whether it can happen again. Full Story
The Deflation Scare of 2008 was very much like the Y2K bug hoax, and what I have termed the Y2K+8 hoax! It had enough substance for the uniformed to believe it was a terrifying threat. But it was never a real threat, which is borne out by the fact that one year later it doesn’t even merit mentioning by the only person that counts when it comes to monetary policy, the Chairman of the Federal Reserve! Full Story
By: John Mauldin, Millennium Wave Advisors - 16 August, 2009
A few weeks ago I first used the term "statistical recovery" to describe the nature of today's economic environment. Today we are going to further explore that concept, as it is important to have a real understanding of what is happening. Full Story
Marking time. Moving sideways. Nothing to see here. Gold is getting really boring. It continues to move sideways inside that megaphone pattern. A break-out is inevitable, but when? Full Story
While I remain short a couple markets and have thus far called ‘no bull’ until our monthly chart (also shown later in the report) confirms, consider that a person who coldly called for a ‘technical reset of human emotion’ would be a tough one to turn. I have been wrangling with the issue lately, and if the bull does indeed turn me – well, don’t say you were not warned. ;-) Full Story
The commodity market is bubbling. Whether it be sugar reaching a three year high, copper and other base metals reaching almost one year highs, or oil and gold rising further. The markets are looking good. Full Story
By: Richard Daughty, The Mogambo Guru - 16 August, 2009
Thanks to Junior Mogambo Ranger (JMR) Marc H., who sent the clip from CourtHouseNews.com with the perfect illustration of both the worth of the IOUs that the state of California created and used to pay its bills, and the general worth of fiat money (like the US dollar) in general. Full Story
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