By: Julian D. W. Phillips, Gold/Silver Forecaster - Global Watch - 30 December, 2011
Many of the leading fund managers in the U.S. and elsewhere are expecting that governments will confiscate their citizen’s gold. This will not be for the same reasons used in 1933. It will be to facilitate loans, swaps lower interest rates, and shore up international confidence in the turbulent, stressed paper-currency world in which we live. Each nation issues paper as money, dependent on the trust that nation can engender at home and abroad. But is this going to be sufficient, moving into an ever more turbulent 2012? Full Story
2011 certainly was a difficult year for gold bugs. Gold barely held onto its gains for the year while Silver went parabolic and eventually fell to negative on the year. Mining stocks? Don’t ask. The large caps (gdx) are currently down 17% on the year while the mid-tiers (gdxj) are down 41% and the explorers (gldx) are down 44%. In our last commentary we discussed the equities with respect to investing and speculating. By now, you should know that most mining stocks are speculations and do not perform consistently, even in a raging bull market. Full Story
By: Frank Holmes and Gordon Chang - 30 December, 2011
China has become the $5.88 trillion question in the world financial equation for 2012. In an attempt to gauge the direction of this economic elephant, Cambridge House International is asking two China experts to debate the health of the second-largest economy at the Vancouver Resource Investment Conference January 22. We called the two speakers for a preview of the tactics they will take in this epic debate. Full Story
By: Scott Wright, Zeal Intelligence - 30 December, 2011
As 2011 comes to a close, investors will reflect on one of the most tumultuous years in market history. Though the stock markets were essentially flat on the year, those who’ve had skin in the game probably feel like they just stepped out of a barrel that went over Niagara Falls. In assessing what worked in 2011, investors can yet again take solace in “old reliable”. For the eleventh consecutive year gold will have returned positive gains. Not only has gold’s secular bull delivered consistency, it has delivered robust returns that have greatly rewarded investors. Since its low of $256 in 2001, gold has soared 640% to its high earlier this year. And with only a couple days remaining, gold is looking to close out 2011 with a 9%+ gain despite its recent selloff. Full Story
We are on the cusp of a new year, and this is the time that we take a look at those brave (or foolhardy) financial analysts who take out their crystal ball and predict where precious metal prices will go in 2012. But first let’s see how last year’s prognosticators (including Sunshine Profits) fared. We are talking about predictions for the very chaotic 2011. Full Story
The Federal Reserve was conceived and given birth by an unholy alliance of American and British bankers. The FED buys U.S. debt with money printed from nothing, then charges U.S. taxpayers interest. The US government pushed through the federal income tax amendment, restarted an income tax on Americans to pay the interest to the FED and reorganized the IRS to collect the monies – the interest - “owed” to the FED from its citizens. Since the Fed’s creation in 1913 the dollar has lost more than 96% of its value. Undoubtedly the greatest achievement of the FED has been to transform America from being the world’s foremost creditor nation to the world’s largest debtor nation. Full Story
By: Chris Powell, Secretary/Treasurer, GATA - 30 December, 2011
As a practical matter, this assumption of mainstream financial journalism is probably correct. But the world might begin to change, however slowly, if journalists tried putting the questions to central bankers in public settings anyway and reported their evasions or refusals to answer. Eventually investors and even the public might come to understand that great power, the power to control the prices of all capital, labor, goods, and services in the world -- that is, the power to control the price of everything, absolute power -- was being exercised in secret so that the world more easily might be expropriated, that democracy had been crushed, and that, as a mere high school graduate remarked a few years ago, "There are no markets anymore, only interventions." Full Story
By: Rick Ackerman, Rick's Picks - 30 December, 2011
As promised, here are my predictions for 2012. So many things could go horribly wrong that it’s probably best that we simply try to live our lives to the fullest and not worry too much about the headlines. Before I start listing away, let me wish you all a happy New Year. Whatever the news brings in 2012, may you and yours enjoy good health, happiness and inner peace. Full Story
Just as the January edition of the ArabianMoney investment newsletter came out tipping silver and gold for the year ahead with actionable investment advice for subscribers that is not given on this free website, the precious metals staged their biggest price retreat since 2009. Silver plunged below $27 and gold dived towards the $1,550 mark. At first sight this looks like year-end profit taking by hedge funds who have been big investors in precious metals this year, and largely responsible for the wild price swings. Full Story
By: Julian D. W. Phillips, Gold/Silver Forecaster - Global Watch - 29 December, 2011
In 2011 investors saw gold perform outstandingly in the quiet season in July, August. $2,000 looked a certainty before the end of the year, but then unusual forces pummelled the gold price and all other global financial markets. Shades of the credit crunch hit the markets under the title of the Eurozone debt crisis. This had been going on for the last two years, but it entered a very dangerous stage in the final quarter of 2011. Full Story
Ron Paul published Gold, Peace, and Prosperity in 1981. What makes his pamphlet especially attractive today is the speed with which it can be consumed. A reader could get through his robust prose during an hour lunch break. Full Story
Yes, indeed, Equities Markets Internals are weakening. And QE is burgeoning with the Massive EQE having just been launched. Considered together these two developments Provide a Road Map for Key Markets’ 2012 Performance, and Opportunities for Profit. Jim Rogers has it about right and his advice is consistent with our Agricultural Commodities Recommendation a couple of weeks ago. Full Story
Currently, the Gold/XAU ratio is trading more than 2 standard deviations away from the mean, making them at least 50% undervalued in the aggregate. The fundamental drivers of gold have only improved as the year has progressed yet XAU index has remained severely depressed. While the overall equity market are overvalued, the Gold/XAU ratio illustrates the exact opposite occurrence in the gold mining stocks and presents an extremely lucrative buying opportunity. Full Story
With the move below $1535 this morning gold has confirmed that it is still moving down into a D-Wave bottom. There has been some question as to whether or not the D-Wave had bottomed in September. The penetration of that intermediate low this morning confirms that the D-Wave did not end during the overnight selloff on September 26. Full Story
Throughout the West, unemployment remains stubbornly high. Unemployment in these European nations ranges from 8.5% in Italy to over 20% in Spain. For Europe as a whole, the figure is 10.3%. What is revealing is this: ever since 1995, it has been above 9% most of the time. Only in February 2008 did it fall to 7.3%. For workers under age 25, the figures are much worse. A generation of educated college graduates has become a lost generation. Yet as the chart reveals, a few countries are doing far better. Netherlands, Austria, and Germany have rates from about 4.5% to 6.5%. These are nations noted for their comparative frugality. Full Story
Gold is consolidating below $1600 as we enter the last week of the year. The last London gold fix of 2010 was $1405, so barring any dramatic price changes in the last week of the year, the yellow metal is on-track for yet another double-digit gain of about 14%. Full Story
By: John Browne, Senior Market Strategist at Euro Pacific Capital - 28 December, 2011
As the year draws to a close, understandable confusion reigns in the minds of many investors. While short-term indicators, such as consumer confidence, appear to beckon recovery, the longer-term strategic issues remain shrouded in the smoke and mirrors of central bank monetary manipulation. From the perspective of someone who has keenly observed global economics for more than a half century, I see little reason to believe that our economic morass will soon improve. Indeed, I do not believe we will see meaningful change until the Bretton Woods era of U.S. dollar dominated paper money finally comes to an end. In other words, our current experiment in unlimited monetary expansion will continue until it explodes. Full Story
By: The Gold Report and James West - 28 December, 2011
James West isn't interested in timing the precious metals market—that's a good way to end up butchering perfectly good investments. As the editor of The Midas Letter and portfolio advisor of the Midas Letter Opportunity Fund, West doesn't even check the daily trading of the stocks he's following. In this exclusive Gold Report interview, he says he's more interested in making sure companies meet their long-term goals so he and his investors can cash out in the black. Full Story
By: Bob Chapman, The International Forecaster - 28 December, 2011
The game goes on, as German leadership tells us the euro is stable, even as it hits yearly lows. We are told the problem is a crisis in several member states. That may be true, but they all are inseparable. The reassurance from politicians and bankers to calm the market place is beginning to fall on deaf ears. No matter what the cause of the debt crisis it exists and leadership as yet cannot find a solution. Even short-term solutions, such as the use of the EFSF are not going to work. All they will do is gain time. Full Story
Government fiscal policy and central bank monetary policy have the specific goal of stamping out the business cycle. Governments have been intervening in the economy and financial markets with fiscal policies for thousands of years. Central banking, at least its current form of the last one-hundred years or so, offers more sophisticated and less transparent methods of intervention including interest rates, quantitative easing (QE), reserve requirements, currency swap lines, bank loans, etc. Use of these tools has risen sharply in recent decades, but they have never really worked. It is time to realize that business cycles and their accompanying market cycles are natural forces that are here to stay. Full Story
Held captive by the low volume holiday week, gold sector investors look as if they will get dunked again upon the US market open today. There are a few different potential scenarios in play with regard to the gold stocks, but gold itself has been pretty clear since the momentum-fueled 'channel buster up' last summer. Full Story
It takes time to steal a wise man’s freedom. He can’t be talked out of it. But he can be made to give it up for something higher. What’s higher? Why, his country, of course. What is his country? He doesn’t know exactly. Whatever it means it can’t omit the government. The government, he learns in government schools, is a vital part of the better things in life. Full Story
By: Julian D. W. Phillips, Gold/Silver Forecaster - Global Watch - 27 December, 2011
Japan and China will promote direct trading of yen and yuan without using dollars and will encourage the development of a market for companies involved in the exchanges, the Japanese government said over the holiday weekend. Japan will also apply to buy Chinese bonds next year, allowing the investment of Yuan that leaves China to Japan to remain in China, the Japanese government said. Encouraging direct yen- yuan settlement should reduce currency risks and trading costs. Full Story
How long can the European media keep the EU credit implosion a secret? The disgraced former IMF Director, Demonic Strauss Kahn said on Tuesday December 12th, 2011 that No 'Firewall' Exists and Europe Has 'Only Weeks'. Of course within minutes of this Financial Times news release which detailed his vent on EU leadership and the perilous situation in Europe, the article disappeared. Full Story
If there is a flow of capital that portrays the current mindset of the average global investor perfectly, it is likely the incredible demand for so-called “risk-free” investments. “If the last two weeks are any indication of how next year will start, there’s near-insatiable demand….We have a significantly shrinking supply of risk-free assets in the world and U.S. Treasuries are one of the few left.” - Ira Jersey, interest-rate strategist at Credit Suisse Group AG, in an interview with Bloomberg News, Dec 21, 2011. Ira is referring to the incredible demand for US Treasuries and T-Bills. Amongst hedge funds and the public, the European crisis has ignited a surge in dollar bullishness and euro bearishness. Full Story
At this time, it seems that the odds favor a rally in the Euro Index. The situation has improved in Europe and although it is still not good, it is better. The outlook for the euro therefore has improved, and the very negative publicity which has been handed out by the popular media outlets is no longer current. Full Story
As should come as news to no one, over the past ten years precious metals have been in a secular bull market, one which still has strong fundamentals going forward. Most secular bull markets last around twenty years and this bull market in commodities will be no different. What makes gold different than most other commodities is that gold is money, a store of value, a financial safe haven and the currency of last resort. History has shown us over and over again that gold will shine its brightest when monetary policies fail and fiat currencies become devalued. This time will be no different. Full Story
By: John Mauldin, Millennium Wave Advisors - 27 December, 2011
It’s Christmas Eve and that time of year when we start thinking about what we did in the past year and what we want to do in the next. Why do we make the mistakes we make (over and over and over?) and how do we avoid them in the future? If it seems to be part of our basic human condition, that’s because it is. Recently I have been having a running conversation with Barry Ritholtz on the psychology of investing (something we both enjoy discussing and writing about). Since I am busily researching my annual forecast issue (and taking the day off), I asked Barry to share a few of his thoughts on why we do the things we do. He gives us even more, exploring the three main opponents we face when we enter the arena of investing. Full Story
For a country with no official gold reserves the UAE is still a major force in the global gold trade. State news agency WAM yesterday reported that security officials have foiled a money laundering operation that involved the smuggling of 94 kilograms of gold from Africa into the oil-rich state. Full Story
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