BLAME speculators, poor weather, global demand, or the Federal Reserve as you choose. Either way, sugar's up, wheat's up, and cotton's new record highs are starting to hurt Chinese textile makers. Full Story
It's official: the Federal Reserve announced on November 3rd that it will create approximately $600 billion of new money to fund US Treasury bond purchases, and will also utilize another $250-$300 billion of money that had been previously created (also out of the nothingness). The usual term in the media for these planned purchases is "QE2", as in the second round of quantitative easing. Full Story
By: John Browne, Senior Market Strategist, Euro Pacific Capital - 5 November, 2010
This week, desperation became palpable at the Fed. In both the formulaic statement that accompanied its FOMC policy decision and Chairman Ben Bernanke's unusual (and clumsy) Washington Post op-ed follow up, the guardians of our currency expressed grave disappointment at the slow pace of US economic recovery and emphasized the continued threat of deflation. The Fed is now pledging to defeat this recession using any monetary means necessary. Unfortunately, their embrace threatens to smother our economy. Full Story
By: Adam Hamilton, Zeal Intelligence LLC - 5 November, 2010
The highly-anticipated 2010 mid-term elections are finally over, a huge relief if you hate politics and government meddling in our lives as much as I do. Now that the American people have fired the arrogant politicians who refused to listen to the will of their tax-paying constituents, we can get back to focusing on the financial markets. So how do the stock markets tend to perform after mid-term elections? Full Story
Here is the glaring hole in the United States Federal Reserve’s approach to what it calls stimulus, and what history will one day categorize as fraud: You can’t use your own debt to purchase more debt when you can’t repay the original debt. The crime is compounded when you know you’re never going to repay the debt. It amounts to treason to intentionally destroy the integrity of the nation’s money. Full Story
Not since The Great Depression have there been such Formidable Challenges to those who wish to Profit and Protect their Wealth. If it was not clear before 2008, the Fall, 2008 Markets Crash, Credit Freeze, and Financial Institutions Collapse made it clear, that we have entered into an Entirely New High Risk Era in the Economy and Markets. Full Story
On November 3, 2010 the Federal Reserve Board announced another round of money printing (aka quantitative easing), and yesterday Chairman Bernanke defended the Fed’s actions in the Washington Post. It is unusual for Mr. Bernanke to use the op-ed format to impart the Fed’s thought process. This speaks to the fact that while so many are aware of the risks of QE2, so few see the potential benefits. Before some thoughts on QE2, first an overview of Bernanke’s commentary. Full Story
The first round of QE had already guaranteed that the dollar was going to be under severe duress by next spring. Bernanke just added insult to injury yesterday and virtually guaranteed we will have a major currency crisis by next spring. Full Story
It certainly looks as though once again insanity has prevailed over common sense. In what has become a recurring theme in our world, particularly from a policy standpoint, the Federal Reserve announced another round of government bond purchases, dubbing the effort ‘QE2’. I wonder if QE2 is any relation to R2D2 from the popular Star Wars series? Full Story
It’s very important to have a plan to follow – with a strategy you can articulate and tactics you know you can execute. Such clarity is a huge benefit to investors, especially that bold breed that’s willing to call themselves speculators. It’s the backbone that helps us stand firm as contrarians, and buy when everyone else is selling (low) and sell when everyone else is buying (high). Full Story
While investors sit idly by, waiting for any confirmation in direction of Fed policy-making, a much larger issue is being critically overlooked. That issue, of course, is negative real interest rates. Full Story
The past few months has seen some strange, volatile moves in the gold, silver and agricultural grain markets. All of their associated futures markets have been in an undeniable bull run. Yet, despite the power and strength of the bull, all of a sudden, out of the blue, these markets have had some unusually large down days for a day or so and then they will almost immediately bump back up with equally large, seemingly uncalled-for gains to offset the declines. There has to be some explanation for this strange reaction in the futures’ markets. This Goldsmiths will broach that theme now. Full Story
By: Richard Daughty, The Mogambo Guru - 5 November, 2010
The latest news to depress me is that incomes were reported down 0.1%, and the latest news about spending is that spending is up 0.2%. The reason that it was extraordinarily depressing for me is that I was trying, in vain, to explain to the drooling half-witted pinhead idiot seated next to me at the bar that I think that “spending” is actually waaAAAaaay down... Full Story
Historically, an election following the election of an “anti-business” president has proven to be a negative for metals, but a positive for stocks. As the numbers come in and are tabulated, investors bet on a changing mood from government, one towards fiscal responsibility, lower taxes and regulation, and general pro-growth policies. Of course, the effect is only temporary. Full Story
A love affair with silver is so natural. The fundamentals are astoundingly positive and bullish in price prospects. My basic argument has been repeated many times. Industry has countless uses for silver, significant demand. But industry has only miniscule isolated uses for gold, in trivial demand. So silver wins on the Demand side of the equation. Central banks own a huge amount of gold. They frequently sell it, even through their slippery surrogate the Intl Monetary Fund. Central banks own zero silver. So silver wins on the Supply side of the equation. My motto is that gold fights the major political and financial war, but silver will ride in on a shiny white horse and take much larger spoils. Full Story
By: Ira Epstein, The Linn Group - 4 November, 2010
I believe that today’s rally in gold marks the end of the October selling correction. I now expect to see general upside momentum going into year end. Yes, there will be price breaks and somewhere along the way I expect consolidation to take place. But I don’t expect to see the most recent low of 1315.6, made on October 22nd, to be penetrated in the near future. If it is, I will have to rethink my price objectives. Full Story
The big smart money has already taken positions in precious metals and the corresponding shares. They know that today’s results won’t change the bullish prognosis. Unlike the financial punditry of today, these folks are thinking five years down the road. They see default coming in the western world in one way or another. They know that precious metals offer safety and potentially, huge profits. Full Story
By: The Energy Report and Marin Katusa - 4 November, 2010
Casey Energy Opportunities Senior Editor Marin Katusa shares his perspectives and predictions on the direction in which the energy sector is headed—from popular green alternatives like geothermal, run-of-river hydro and natural gas to the oil sector all the way to the less-popular, but very viable, uranium sector. The Energy Report caught up with Marin at the New Orleans Investment Conference for this exclusive interview. Full Story
The only major economy to hit deflation since before the Second World War, Japan thus offers our only template for what a modern deflation might look and smell like. Hence its obsessive hold on central-bank chiefs and would-be policy-makers (Ben Bernanke at the Fed, Adam Posen at the Bank of England, Paul Krugman everywhere). Hence BullionVault's quick survey of Japan's investment landscape since 1998. Because it looks remarkably like the ground opening up before US and UK investors tonight. Full Story
By: Richard Daughty, The Mogambo Guru - 4 November, 2010
Bill Bonner here at The Daily Reckoning writes, “In England, the government of David Cameron has announced the biggest cutbacks since WWII. He’s going to lighten the UK government expense load by 81 billion pounds over the next 5 years. Nearly half a million government employees are to be given the heave-ho.” Full Story
By: Rick Ackerman, Rick's Picks - 4 November, 2010
Putting the day’s political Sturm und Drang aside, there was still the not-so-small matter of the $900 billion stimulus. The marquee number was actually $600 billion – just a tad above the $500 billion rumor that had been floated as a lowball estimate. But there was more, in the form of $35 billion each month, for eight months, to purchase an additional dollop of Treasurys with proceeds from mortgage bonds the Fed plans to retire. We have ceased to be dumbfounded that the news media buy into this shell-game whenever it is run. Full Story
Assume for the sake of argument that all banks in the whole wide world succumb to the sudden death syndrome simultaneously. What does this mean in terms of the production and distribution of consumer goods? Would we have to go back and start from scratch to save in order to replenish society’s circulating capital? Saving is a time-consuming process and people have to get fed, clad, shod, and sheltered in the meantime. We could not restore circulating capital through saving for the simple reason that before we could we would die of starvation. Full Story
Silver, however, has barely made it halfway back to its prior nominal high of $49.45 an ounce, achieved on January 21, 1980. In order to break into new territory in inflation-adjusted dollars (using the same CPI calculation methodology used in 1980), silver would have to rise to over $250 an ounce – more than ten times where it is today. Full Story
It seems the current Chairman of the Federal Reserve is of the belief that diluting the dollar is the cure for everything from a recession to male pattern baldness. And like other snake-oil salesmen before him, Mr. Bernanke is heavy on promises and light on results. Here are five prescriptions that money printing can't fulfill: Full Story
By: Bob Chapman, The International Forecaster - 3 November, 2010
The UK, Europe, the US and Canada are different degrees of welfare states. By way of regulation, government controls via taxation. The states and their inhabitants send taxes to Washington, which takes its cut and sends funds back to the states with strings attached. You either do what we want you to do, or we cut off your funds. The states and the people are subject to extortion with government using their funds to do so. By using regulations, welfare and extortion, the federal government creates dependency. Full Story
By: The Energy Report and Luc Mageau - 3 November, 2010
Raymond James Oil and Gas Analyst Luc Mageau believes that with relative near-term stability in oil and gas prices, making money in the exploration and production (E&P) space is all about choosing wisely. Naturally, location is a big part of the equation. In this exclusive interview with The Energy Report, learn why Luc recommends investors invade Canada's Viking Formation. Full Story
By: Richard Daughty, The Mogambo Guru - 3 November, 2010
When I got back to the office, the place was abuzz, all stemming from how my boss wanted to “see me” as soon as I got back from wherever the hell I was. I knew what it was about. It was about old man Sanderson and the stupid Sanderson account. Full Story
By: Rick Ackerman, Rick's Picks - 3 November, 2010
The polls don’t close for another three hours, but we’ll go out on a limb with a prediction that the Dow will rally at least 175 points when stocks open on Wednesday morning. The exuberant reaction will be a variation on Barack Obama’s Hope and Change-inspired landslide in the 2008 election. Now as then, revelers will be so worked up about the very prospect of change, any kind of change, that they won’t much care about the details. Full Story
By: Julian D. W. Phillips, Gold/Silver Forecaster - Global Watch - 2 November, 2010
The I.M.F. announced that 32 tonnes of gold was sold by them in September. This included the 10 tonnes to Bangladesh. This leaves around 71 tonnes left to go and we have passed October now. If they sold a similar amount in October then we are down to just below 40 tonnes remaining for sale by the I.M.F. If they continue this pace of selling they will only be left with less than 10 tonnes to sell in December and will complete their sales before the end of this year. Full Story
I’m not selling any core bullion, and I added to my core bullion into the lows of $1156. I urged you to do the same, documented in writing in my newsletter and across a myriad of gold websites, with an average delivery price of $1180 for myself. I believe new monies placement is best skewed towards increasing your Gold stocks to bullion assets ratio, to provide the best possible upside reward and downside risk management for you. Full Story
Whereas the apparent robust performance of major indices around the world suggests the world is returning to something approaching normal, what we’re really seeing is a long line of traps being set to snag a fresh round of suckers who fall for the mainstream smokescreen. With another US$1 Trillion on the way from the Fed to further devalue the dollar, and with other nations thereby comforted sufficiently to follow suit, gold and silver prices can do naught but rise. Full Story
The collapse of the international gold standard was the direct consequence of this malicious and vindictive decision. The gold standard could not survive the destruction of its clearing house: the bill market — its most vital organ. Full Story
Since World War II, most economists have been apologists for government growth.[1] Now the "experts" who never see a crisis coming tell us that we must once again abandon free-market principles to save the free-market system. But there's always the possibility that people not seated at the government's table will finally wise up. Who or what could help them understand what's going on? Full Story
For many, the strength of the Japanese yen is a conundrum. How can the currency of a country with such a weak economy, such a high level of debt, weak leadership, poor demographics, combined with an ever deteriorating economic outlook be so strong? Many market participants did not anticipate that the yen would demonstrate such strength 24 months ago. Now, many commentators focus on Japan’s “safe haven” status as a key reason why the currency has appreciated. Full Story
Fire River Gold Corp. is a near term production company with an experienced technical team focused on bringing its flagship project, the Nixon Fork Gold Mine, back into production within the next 12 months. The Nixon Fork Gold Mine is a fully permitted and bonded mine with past production values averaging 39 g/t (1.14 opt). Facilities at the Nixon Fork Gold Mine include a 200 tpd flotation plant with a gravity gold separation circuit and a sulphide flotation circuit. Full Story
By: Steven Saville, Speculative Investor - 2 November, 2010
We agree that gold is a faith-based metal, although we don't like the term "faith-based". It is more appropriate to say that gold's value is not primarily determined by how much of it gets consumed in industrial, commercial or digestive processes. Gold is not "mostly used for nothing more useful than jewelry", as Grantham claims. It is mostly used as a store of purchasing power. Full Story
The gold price recently made a new high amid widespread concern over weakness in the U.S. dollar. The gold rally has been driven by strong global demand among investors seeking a safe haven. Demand has been driven mainly by uncertainty over the economic outlook, as investors continue to recover from the fallout of the financial crisis two years ago. Full Story
By: Richard Daughty, The Mogambo Guru - 2 November, 2010
A lot of the “news” lately is about the upcoming election and how the absurd, childish Democrats are expected to be ousted by the voters, replaced by the evil, adult Republicans. As a disclaimer, I, with great relief, now happily identify with the Tea Party, although I seem to be one of the few whose Screaming Tea Party Outrage (STPO) is directed at the politicians... Full Story
By: Rick Ackerman, Rick's Picks - 2 November, 2010
Stocks took a nasty reversal off yesterday’s fleeting high after falling an inch shy of a benchmark where we’d warned that bears would have to start worrying. Specifically, we’d said that if the E-Mini S&P futures exceeded 1196.50, that would set them up for an even more vicious short-squeeze that could last for weeks if not months. In the actual event, the E-Mini topped Monday at 1192.75, four points beneath our bullish trigger threshold, after rallying the equivalent of 100 Dow points Sunday night on near-zero volume. Full Story
That’s right folks, it’s all about the dollar ($) in the financial markets these days, and the $ is all about its accelerating debasement at the hands of the Fed. This of course must be rubber stamped by the politicians to be considered ‘legal’, however it should be understood there’s nothing legal about this as the destruction of the $ via fiat declaration is fundamentally unconstitutional. Full Story
By: The Daily Bell and David Morgan - 1 November, 2010
"The major monetary metal in history is silver, not gold." – Nobel Laureate Milton Friedman in an interview with James Blanchard at the New Orleans Investment Conference. November 7, 1993. The above quote is fact of monetary history but few in the West study or know silver's history. Yes, gold is money but silver has been used as money more often, in more places, by more people than gold ever has. Full Story
There is a general sense among gold bugs that gold and silver move together. This is true in the very long term, but it is perhaps more accurate to say that they take turns. When the mood of the precious metals community is conservative, they favor gold, and gold outperforms silver. But when the mood becomes more speculative, they favor silver, and it outperforms gold. Full Story
The financial crisis is finally coming into focus. Banks don’t have a right to foreclose. It’s a simple concept. The public understands and has a great deal at stake. The bankerment duopoly can’t fix this with the usual techniques. Continuing the illegal foreclosure comedy will lead to revolution. The only way to keep the financial system alive is to print money. Full Story
By: Rick Ackerman, Rick's Picks - 1 November, 2010
Solving the world’s debt problem dominated the discussion in the Rick’s Picks forum over the weekend, with the final word going to “Jill,” who congratulated the group for “putting on their thinking caps and devising some kind of solution rather than just abandoning all hope.” From where we’re sitting, however, it is only those who have abandoned hope who truly understand the problem. Full Story
By: Julian D. W. Phillips, Gold/Silver Forecaster - Global Watch - 31 October, 2010
Since we received reports from the CFTC that market players have made "repeated" and "fraudulent efforts to persuade and deviously control" silver prices, we have heard that HSBC Holdings Plc and JPMorgan Chase & Co. are facing an investor’s lawsuit of placing “spoof” trading orders to manipulate silver futures and options prices in violation of U.S. antitrust law. Full Story
Gold and silver at last staged the expected correction necessary to unwind the extremely overbought condition that had persisted for weeks. Once the correction started we had figured it would take gold down to about $1300, probably with a 3-wave movement, and although it did drop to about $1316 at its lowest point intraday, the bullish action late last week makes a return to the $1300 area much less likely. Full Story
Robert Parker is a well known investment expert, Senior Advisor at Credit Suisse and a frequent television commentator. So when we had a chance to hear him give a presentation to an exclusive group of the bank’s heavy weight clients in an invitation-only event, we were interested to hear what he had to say. Or more to the point, we wanted to know what the bank’s wealthiest clients are hearing. Full Story
The stock market has always been a dynamic affair but until the turn of the century 10 years ago, there were always a few tried-and-true relationships you could always count on. For instance, in the 20th century it was almost always true that if the broad market as reflected by the Dow or the S&P was rallying and the gold and oil stocks were also rallying, the rise in the broad market was viewed as suspect and in most cases would soon reverse. It was said that “What’s good for gold/oil is bad for stocks.” Then along came the bull market of 2003-2007, which completely blew that relationship out of the water Full Story
Gold and silver forge on to new highs and all is looking well for the next up leg in this multi-year bull market. Yet all was not looking so sure some months back when the crash of the credit crunch was still echoing in people’s ears, talk of a double dip recession was rife and the tower of bail-out debt threatened to tumble down on many a government. Full Story
By: Bob Chapman, The International Forecaster - 31 October, 2010
The recognition of currency war, which has been going on for years, reflects the failure of international cooperation and the failure the G-20 to find a solution of the beggar-thy-neighbor policies of almost every nation. The result has been growing geopolitical dislocation, which G-20 has yet to find a solution for. Full Story
By: John Mauldin, Millennium Wave Advisors - 31 October, 2010
This week we turn our attention to the elections and their aftermath. Long-time readers know I am a Republican, but I offer some sobering advice to my friends on my side of the aisle: Be careful what you wish for. It's one thing to get a few votes. It's quite another to live up to promises that simply can't be kept. We will start our analysis by looking at the GDP numbers that came out today, and we will end by pointing out that there will be no easy choices. And then we can turn our attention where it should be, to the World Series here in Texas. Full Story
Government is not the solution; rather, it is causing the problems. The below slides (view at Scribd) highlight the economic situation, updated from August and May presentation. I’ve written about the solutions to the unemployment problem, the deficit, Social Security, and the high costs of health care which are linked below. Thanks to Lee Trembley for providing some of the research and slides. Full Story
By: Richard Daughty, The Mogambo Guru - 31 October, 2010
In my long life, I have learned many things. Important things. One Important Mogambo Lesson (IML) is that “responsibility is a cruel taskmaster,” and that one should accept as little responsibility as possible, especially if it concerns taking responsibility for a wife and family, who not only seem to exist for the sole purpose of bankrupting me and driving me absolutely insane with their silly Earthling antics, but are also so stupid that they cannot be made to understand the Vital Freaking Importance (VFI) of investing every dime into gold, silver and oil when the Federal Reserve is creating so much money that it causes inflation in prices to rise above zero. Full Story
What a fantastic week for those in the camp who’ve known that all was not as it seemed in the Silver market. I delve a bit more into it later, but there are a few widely quoted “personalities” who have so much egg on their face now that it will take weeks or months to get every last crack clean. Full Story
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