Now it’s official! The yellow metal has gotten the golden seal of approval. This week none other than the President of the World Bank said leading economies should consider readopting a modified global gold standard to guide currency movements. Writing in the Financial Times, Robert Zoellick, the bank’s president since 2007, says we need a successor to what he calls the “Bretton Woods II” system of floating currencies. Full Story
By: Daniel Aaronson and Lee Markowitz - 12 November, 2010
Recently, many commodity prices have undergone parabolic increases leading market participants to conclude that high inflation is on the horizon. However, history suggests otherwise as parabolic price increases have always led to parabolic price declines. Full Story
By: Adam Hamilton, Zeal Intelligence LLC - 12 November, 2010
Since emerging out of the usual summer doldrums, silver’s performance has been dazzling. Buyers are returning to this hyper-speculative metal en masse, driving some fast-and-furious gains. And the Fed poured rocket fuel on silver’s hot rally last week when it announced its newest inflationary campaign. Full Story
By: John Browne, Senior Market Strategist, Euro Pacific Capital - 12 November, 2010
With our economy sagging and our international clout waning, one of the few assets upon which the United States can rely is the confidence that the rest of the world has traditionally showered upon us. That confidence is the reason why the US dollar was elevated to global reserve status more than 65 years ago. Full Story
By: Louis James and Doug Casey - 12 November, 2010
Good evening Doug. The Fed's new $600 billion liquidity injection pushed gold to new records, at least in current dollars, topping our $1400 target for this year. Our gold stocks are up even more. Even the World Bank is suggesting that a return to some sort of gold standard might be worth considering. Does the market feel "toppy" to you? What do you make of the latest numbers? Full Story
By: Llewellyn H. Rockwell, Jr. - 12 November, 2010
But guess what? Gold actually hasn’t gone anywhere. It is still the hedge of choice, the thing that every investor embraces in time of trouble. It remains the most liquid, most stable, most fungible, most marketable, and most reliable store of wealth on the planet. It has a more dependable buy-sell spread than any other commodity in existence, given its value per unit of weight. Full Story
By: Ira Epstein, The Linn Group - 12 November, 2010
It’s all systems go as the QE2 program kicks in. The Fed is set to purchase the first round of treasuries using some of their newly acquired QE2 funds over the next 30-days. $105 billion is earmarked for this first round the purchase. According to the NY Fed, the purchased of treasuries will go in terms of date from 2012 to 2040, which means to some degree all parts of the yield curve will be impacted. Full Story
It is becoming ever more widely understood, correctly in our view, that the National Debt of the USA (and that of certain other Major Nations as well) can never be repaid without further dramatic Debasement of the Purchasing Power of the U.S. Dollar (and those other Fiat Currencies). Full Story
The news wires were ablaze with reports of the recent Fed FOMC meeting of Nov 2-3 and the Fed decision to buy some $600 billion in US debt in the next 8 months to supposedly reduce interest rates. But knowing the capacity of Bernanke to lie and deceive the suckers, maybe we should open our closed eyes and brains and ask if something else could be afoot. Full Story
By: Richard Daughty, The Mogambo Guru - 12 November, 2010
There is a lot of wailing and gnashing of teeth from Moron Keynesian Trash (MKT) about the brave Robert Zoellick, president of the World Bank, saying that what the world needs is a modified gold standard for currencies, which it does, in spades. Full Story
By: Rick Ackerman and Wayne Razzi - 12 November, 2010
Today’s commentary, on the pernicious influence of the mainstream media, is from Wayne Razzi — aka “Red Will” in the Rick’s Picks forum. We only think we are changing this world for the better when we throw the rascals out on election day, says Wayne. In reality…well, there may be no reality for those who see the world through the eyes of TV news, pop magazines and newspapers. If we are to escape from the illusion that has imprisoned us like a maze, says Wayne, we’re going to simply have to free our minds from the illusion itself and walk away from it. Full Story
By now you have plenty of reason to congratulate yourself for having boarded the gold bandwagon. The early tickets are the cheap ones, and you’ve already had quite a ride. The best of the ride, I believe, is yet to come, and it should be very good indeed. It should be so much fun that your wallet may start to feel a bit giddy – which can be dangerous. So it would be wise to consider, now, how things will be and how they will feel when the current bull market in gold reaches its “end of days.” Because it will end. Full Story
By: Gary Dorsch, Editor, Global Money Trends - 11 November, 2010
“Imagination is more important than knowledge,” the brilliant Albert Einstein used to say. Imagine for just a moment that the Dow Jones Industrials has become a key instrument of national economic policy, and that by “actively managing” its direction, the Federal Reserve could impact the wealth of tens of millions of US households, and by extension, influence consumer confidence and spending. By ramping up the money supply, and slashing interest rates to zero percent, in order to inflate stock market bubbles, the Fed could in theory, fuel an economic rebound. Full Story
This report delves into the key factors contributing towards the probability of high inflation, by providing a historical and present overview of the global monetary system; exploring historical empirical studies of crisis sequencing; examining the current inflationary forces, showing the key differences between now and the Great Depression; and evaluating the current economic and financial position, and performing a brief stress test displaying the limited ability for the Western World to fight inflation from a financial, economic and political standpoint. Full Story
Since 1999 resp. 2001, the USD-goldprice is in a superior upward-trend, whereas the (green) trend-channel dominates the upmove – rising relatively strongly after breaking the (red) consolidation-resistances. As the (violet) trend-channel was broken recently, a buy-signal was issued that was changed to a sell-signal with reaching the upper (green) resistance at approx. 1420. Full Story
As a mortgage broker during the manic years of the housing boom, I witnessed reckless financial practices on a wide scale. As a result, I was not surprised by the "robo-signing" mess that now threatens the mortgage sector. Unfortunately, the scandal is only a small tip of the iceberg that threatens to take down the entire US banking system. Full Story
November 5 marked the beginning of Diwali festival in India and the next stage in gold’s seasonal patterns. The five day “Festival of Lights” is a major Hindu holiday and involves the lighting of small clay lamps (diyas) filled with oil to signify the triumph of good over evil. During Diwali, lights illuminate every corner of India and fireworks light up the skies. Full Story
The Federal Reserve’s (Fed’s) strategy of firing up its printing press may have the debasement of the U.S. dollar as its goal, but it’s important to note that the Fed does not act in a vacuum. In our humble opinion, Fed Chair Bernanke is wrong both on substance and politics – a potentially explosive mix. Full Story
Is today similar to the 2006 peak or is it something more dangerous, like the peak of 2008? I will say neither, because the T-bill yield (and thus Fed funds) had been rising into the 2006 top, and declining relentlessly into the 2008 top. Today, we have a Fed managing bottomed out T-bill yields and getting ‘creative’ in their use of additional inflation mechanisms. Full Story
There is no doubt whatsoever that calling tops and bottoms is a fools game, but in reality any significant pullback of more than 5% should be bought. And the odd time we do get a 10% pullback in this raging precious metals bull market, well, back up the truck...and borrow your neighbours, your cousins, you in-laws, and your bosses trucks too. Full Story
DID GOLD's first foray over $1,400 mean we're going back to a Gold Standard? Nope. Not in the West, nor anytime soon anywhere, and for three simple reasons. First, gold prices aren't high enough. Second, modern governments don't hold enough of the stuff – not for their tastes, at least. And third, the pace of physical monetization, out of jewelry and mined ore into coin and large-bar form, just isn't great enough. Yet. Full Story
The largest beneficiaries of rampant quantitative easing and destructive monetary policy are those who can borrow at the most wholesale level of the financial system. Those who have access to the discount windows and emergency windows are doing quite fine, borrowing money and dumping it on the markets to benefit from record low rates and quickly growing inflation levels. Full Story
By: Richard Daughty, The Mogambo Guru - 11 November, 2010
The thing that has sent me into Mogambo Panic Mode (MPM) over the terrifying inflationary implications is the latest outrage from the Federal Reserve, reported at Bloomberg.com as, “The Federal Reserve will buy an additional $600 billion of Treasuries through June, expanding record stimulus and risking its credibility in a bid to reduce unemployment and avert deflation.” Full Story
Today’s guest commentary is from our friend V.R., a management consultant who incidentally was a student of ours before the term “Hidden Pivot” had been coined. Some may find his essay heavy going at times, but the reward for bearing with it, as your editor has found, is that you will have a better understanding of why complex systems, most particularly political and economic, fail. Not all of them do, for sure, and V. elucidates the factors that can make the difference. Full Story
By: The Gold Report and John Embry - 10 November, 2010
Regardless of who's controlling the U.S. Congress, Sprott Asset Management Chief Investment Strategist John Embry holds out little hope for economic happiness in the short run. As he tells The Gold Report in this exclusive interview, "It's consequence time" and "any opportunity to have a pleasant outcome. . .in the relatively near term is long gone." Full Story
By: Jeff Berwick – The Dollar Vigilante - 10 November, 2010
On November 9th the Chicago Mercantile Exchange said it will raise its silver futures trading margins by 30 percent to $6,500 an ounce from $5,000 an ounce effective November 10th setting off a rapid sell-off in the metal. No other margin requirement on any other metals was changed. According to Reuters, "Exchanges often raise margins to mitigate risks as price volatility increases." But, where is the supposed volatility in Silver? The chart below shows an incredibly orderly upward rise in silver. Full Story
To many in the banking and investing community, precious metals were the red headed stepchild. While they were easily accessible and extraordinarily undervalued, no one seemed to pay either gold or silver much attention. Until recently, when both have forged new highs, the opinions on each grow distant. The polarization from such “authorities” on the markets is overwhelming. Full Story
By: Bob Chapman, The International Forecaster - 10 November, 2010
The cult of Keynesianism is about to come upon very hard times. The quantitative easing plan, known as QE1, did not produce a recovery in the American economy. Now one of its staunchest advocates, Fed Chairman Ben Bernanke, has embarked officially on QE2. It is our belief that QE2 will be no more successful than QE1 and it may well be followed by QE3. You might ask why are not other policies being used the answer is the followers of Lord Keynes don’t know what else to do, and they know what they are doing does not work. Full Story
In a gold backed currency system, there are violent de-leveraging crises as the credit system is brought back into line with the inflexible monetary base. But savers are protected through these crises as the value of their gold savings go up, creating the spending power that quickly brings the economy back to life. Over the long run, as productivity increases, the benefit accrues to savers and producers. This increasing wealth is the "deflation" that we have been taught to fear. In fact, it is a great thing for people who work and save. Full Story
A great quote from William Osler typifies the evolution of our current monetary system. He said: “The philosophies of one age have become the absurdities of the next, and the foolishness of yesterday has become the wisdom of tomorrow.” Full Story
China is the world’s largest consumer of copper, zinc and nickel and also among the leading consumers of other base metals. The country has one of the fastest growing auto sector (which has overtaken the US in size) and has plans for rapid expansion of railroads and other infrastructure segments. Not surprisingly, China’s demand growth is expected to be the single most important factor in determining the direction of metal prices. Full Story
By: Richard Daughty, The Mogambo Guru - 10 November, 2010
I have to admit that I am getting so jaded by the horrific monetary and fiscal insanities of the Federal Reserve and the Congress that new horrific fiscal and monetary insanities seem to now sort of “bounce off” my numbed senses. Full Story
Are we now entering the hyperinflationary stage? It is estimated that in 2011 alone, the TOP 15 developed countries (US, Japan, UK, Spain, Greece, etc) will need to raise some $10,200,000,000,000 ($10.2 trillion!) to finance their growing debts. That is 27% of their combined economic output. Not 2.7% but 27%! The consequences will be felt through further monetary devaluations. In essence a big part of the overhanging debt burden is being paid off through an inflation tax for paper currency holders. How much longer will $ or € holders go without having real monetary insurance and protection against this inflation?
Plus:
Gold Resource Corp. – Ultra Low Cost Producer, Soon to be the highest dividend paying gold stock?
By: Julian D. W. Phillips, Gold/Silver Forecaster - Global Watch - 9 November, 2010
Before the Gold Forecaster came into being, it had become clear that gold was headed back into the monetary system. Why, you may well ask? It was because of the “Washington Agreement”. This agreement changed the tone of central banker’s approach to gold. This Agreement inspired the start of Gold Forecaster. Since then the newsletter has forecast the very events that are now taking place and has been right on each of gold’s moves in price and in re-acceptance over this last decade. Full Story
Gold and especially silver have had a great run since August as the US Dollar gets talked down more – especially by its own regulators in the form of the Federal Reserve. Obviously nothing goes straight up and the precious metals will take a breather in this final leg of the multiyear bull market. Full Story
The Gold Magician. He waves his magic wand, and the gold community….awakens. All you thought was going to happen in 2006 an 2008, is happening now. Gold bullion pricing over $1200 is the rocket fuel. Full Story
By: Peter Schiff, Euro Pacific Capital, Inc. - 9 November, 2010
While it's true that history repeats itself, the patterns should always be separated by a generation or two to keep things respectable. Unfortunately, in today's economic world, it seems the cycle can be counted in months. Full Story
Policy makers seem to be out of touch with the realities of the marketplace. The idea of unregulated markets for whom an infinite supply of money and credit is made available is failing before our very eyes, yet the U.S. administration can conceive of no better remedy than to continue flooding the market with a product for which there is no further demand. Full Story
By: Steven Saville, Speculative Investor - 9 November, 2010
Ramping up government spending will make the economy less productive, so it should be no surprise to logical economists that the "Keynesian" response to economic downturns has a very poor record. It should, however, be a big surprise to Keynesian economists, and yet they never seem to be surprised by evidence that their policy prescriptions didn't work as advertised. Instead, they usually claim that the prescriptions would have worked had they been applied more aggressively. Full Story
As gold, silver and many commodities continue higher the shares of the penny stocks traded on the Toronto Venture Exchange are starting to explode. Many investors have some of these penny stocks in their portfolio and some have probably been held for a long time and some have not recovered from the meltdown in 2008. We like to say the boat is starting to float and even the dogs and cats are beginning to rise. Full Story
By: Chris Mack with Lorimer Wilson - 9 November, 2010
Many investors are struggling to understand the ramifications of the recently announced quantitative easing (QE) plan. The bottom line is that QE2 has major future implications for inflation and the price of gold and silver. Full Story
Today the president of the World Bank, Robert Zoellick, wrote an article for the Financial Times suggesting that the leading Central Banks of the world should adopt a "modified global gold standard to guide currency movements". Full Story
By: Nu Yu Ph.D. with Lorimer Wilson - 9 November, 2010
Where should one invest these days for the greatest projected returns? I do weekly analyses of both the American and Chinese stock markets and have identified specific developments that point the way short- and mid-term and suggest a future scenario for one of them. Let me explain: Full Story
By: Peter Schiff, CEO of Euro Pacific Precious Metals - 9 November, 2010
As the world awaits another $600 billion flood from Bernanke's printing press, central bank governors from Brasília to Tokyo are preparing to respond in kind. This is the monetary equivalent of a nuclear war, except instead of radiation, bombs of inflation threaten to make the world economy uninhabitable for saving and productive enterprise. Full Story
Here at Casey Research, we have been rather negative about the economy for many moons. To be otherwise in the face of the decades-long trend toward ever more government – along with its increasingly destructive and expensive meddling in the free markets – would have been foolish. And, so far, we have been right. Full Story
It seems the Fed has given up on the idea that the country can build a viable and stable economy through the conventional means. Instead, our central bank has resorted to once again growing GDP and increasing employment by the creation of asset bubbles. This is a dangerous game that no one, least of all the Fed, knows how to play. Full Story
By: Richard Daughty, The Mogambo Guru - 9 November, 2010
Ted Butler, famous silver analyst and the guy who kept up the pressure about the corruption in the silver futures market for the last 15 years, is in the InvestmentRarities.com newsletter recently talking about silver, and notes dryly that “world silver inventories are at their lowest point in 200 years.” Full Story
By: Rick Ackerman, Rick's Picks - 9 November, 2010
In today’s guest commentary, Rick’s Picks forum regular Doug Graham sounds a note of deep despair over the political economy. There are too many incentives, he says, for our corrupt and deeply dysfunctional system to stay just the way it is. And even if we possessed the fortitude and resolve to put things back on track, the looming inflation of the dollar to the point of worthlessness will render any such efforts moot. Full Story
Since the gold bull market began in 2001 – 2002, gold has outperformed the bond sector and the trend is now beginning to pick up steam. Price is in fact turning exponential, and the RSI and MCD are suggesting the trend has room to move higher. The 50WMA is in positive alignment to the 200WMA (green oval), and both are rising. Full Story
By: The Gold Report and David Goguen - 8 November, 2010
PI Financial's David Goguen is vice president of Institutional Mining Sales, specializing in the mining sector. As part of his service to Canadian and U.S. resource-focused institutional investors, David evaluates and screens junior gold companies by initially dividing their enterprise values by total ounces. Full Story
Gold is overbought from a conventional technical perspective; of this there is little doubt. So the question then arises, if this is to be so, as fundamentals for rising gold and silver prices become stronger by the day (see below), what will cause the prices of precious metals to rise further from here, or after a mild correction? Answer: A widespread (think currency wars) and accelerated currency debasement. Full Story
How is it possible to improve the nation’s economy by counterfeiting money? Members of the paper aristocracy measure the nation’s economy by a statistic called Gross Domestic Product. Gross Domestic Product was invented in the 1930s by a Russian national who worked his way into the New Deal and devised the formula for GDP. He presented this without proof that it actually worked and measured the real economy. Hardly any American can pronounce his name. Full Story
I believe that gold has traded in a repetitive ABCD pattern since the inception of its secular bull market in late 2001. The C wave of the pattern has characteristically concluded with a parabolic, near vertical ascent of price. We are currently in a C wave and I expect that our immediate future will witness a truly exciting and hair raising parabolic advance that will likely take gold to $1,600. Full Story
In a move to boost a “disappointingly slow” economic recovery, the Fed has finally announced that it will buy $600 billion of US government months over an eight month period to lower interest rates and encourage more borrowing. In addition to this announcement, the Federal Reserve also made it clear that it is ready to do more if growth isn’t achieved in the months ahead. Full Story
The problem with our system is that privileged entities can create dollars at no cost and with enormous profit. Therefore, it is in the interest of these privileged entities to confuse and manipulate the store of value system and the credit system to obscure and enable their illegal activities. Full Story
By: Rick Ackerman and Tom Waldenfels - 8 November, 2010
This week, Rick’s Picks will be featuring commentary from some forum regulars who for the most part are mad as hell and not going to take it any more. Today’s commentary is from Tom Waldenfels, a former broker and semi-retired management consultant who goes by the handle “fallingman” in the forum. Tom is skeptical, to put it mildly, that the recent election is going to change things. If the voters want real change, he says, it can only begin with changes in the way they conduct their own lives. RA Full Story
1st Hour: Headline news & the Market Weatherman Report. Spotlight Stock Picks. Host Chris Waltzek & Bob Chapman, The International Forecaster discussion and answer listener's questions. 2nd Hour: Kal Gronvall, Gold & Silver Exchange Robert Gignac, Rich Is A State of Mind Full Story
By: Julian D. W. Phillips, Gold/Silver Forecaster - Global Watch - 7 November, 2010
As we write, the gold price is about to assault the $1,400 level having been $1,332 on Wednesday of this week, a day ahead of the Fed announcement. Against the pound sterling, the yen the Swiss franc and most other currencies the dollar has weakened too. Full Story
The Fed crossed the Rubicon last week with its announcement of another massive tranche of QE (Quantitative Easing or in common parlance money printing), known as QE2. It is thus clear that what is now known as QE1, which was portrayed at the time as "one off rescue of the financial system" was nothing of the kind, but represented instead the bursting of a dam that can never be put back together again. Full Story
By: Bob Chapman, The International Forecaster - 7 November, 2010
This week in gold and silver has certainly been spectacular in spite of continued US government manipulation. The professionals and big hitters just lie in wait for the cartel to push prices down, so they can take them back up again. After almost 20 years of price suppression the government, Fed and other central banks are getting another taste of their own medicine. Full Story
By: John Mauldin, Millennium Wave Advisors - 7 November, 2010
I am going to beg off from personally writing a letter this week, but will give you something even better. Dr. Lacy Hunt offers us a few cogent thoughts on the unemployment numbers. The headline establishment survey came in much better than expected, but the household survey was much weaker. In addition, Dr. John Hussman wrote a piece last week that I thought was one of his best, on liquidity traps and quantitative easing, and that's included here, too. We are embarking on a course through uncharted waters. No one (including the Fed) has any idea what the unintended consequences will be. Full Story
Summing up, at first glance, the gold’s recent move appears very bullish. A second look and further use of analysis tools provides much less optimism. A decisive move above the upper border of the long-term trading channel seen in our very long-term chart is needed. At the same time we should see the gold price moving above the short-term trading channel. Until such a breakout is seen, the gold simply does not look nearly as bullish as at the first glance. Full Story
What master do you serve? Not the president, not even the tax collector or the bill collector. You serve the dollar. You work for it and you do the government's bidding for it. It gives you food, shelter, security, and your station in life. The dollar is a promise that when you work, you will be rewarded, that when you commit mortgage fraud, you will be rewarded, that when you vote for the right politician, you will be rewarded. Full Story
There was a time when gold and silver coins filled all three roles, and at that time it would have been accurate to describe gold as money. Human nature put an end to that. (Technology would have inevitably intervened at some stage too, but human nature got there first.) Full Story
The legend and romance surrounding the famed stock plunger Jessie Livermore has long held a fascination among traders. Livermore has become somewhat of a cult in recent years and there are several books that purport to reveal his secrets for making a fortune in the stock market. None of them can hold a candle to the book which Livermore himself commissioned (written by journalist Edwin LeFevre) entitled Reminiscences of a Stock Operator. Full Story
By: Richard Daughty, The Mogambo Guru - 7 November, 2010
I was casually eating a burrito while having lunch at my desk, and was surprised to see some guy, writing on a “Feedback” blog of TheDailyBell.com, taking exception to David Morgan of The Morgan Report saying that “On a longer term basis silver and gold are going far higher in paper terms in any currency you wish to name.” Full Story
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