All times are U.S. Mountain Time
(Yesterday's Discussion.)
Calidor (1/3/07; 23:55:38MT - usagold.com msg#: 150689)
Hopefully Nadler's "pictures of all the gold in Fort Knox" ....
.... don't have 007 fighting Odd Job in the foreground.
Best wishes to all for a healthy, happy, and prosperous New Year.
Calidor
Chris Powell (1/3/07; 22:46:54MT - usagold.com msg#: 150688)
Kitco's Nadler can only sneer at Blanchard report, not answer it
http://www.resourceinvestor.com/pebble.asp?relid=27735
12:35a ET Thursday, January 4, 2007
Dear Friend of GATA and Gold:
Resource Investor's Jon A. Nones has gotten a bit of a debate going between Blanchard & Co.'s research director, Neal R. Ryan, author of the recent critique of the secrecy of central bank gold lending, and Jon Nadler, an analyst for Kitco.com. Nadler has been doing a lot of sneering at the Blanchard report, which Ryan has considered unfair. So Resource Investor has given them a chance to elaborate.
Nadler seems to have backed off a bit from his declaration that the gold market couldn't possibly be manipulated by the central banks. He tells Resource Investor: "We are not saying we are right, but would naturally prefer to be proven wrong by hard facts, accurate figures, and solid proof."
This is a strange formulation. If you're not saying you're right, why make the assertion in the first place? And again Nadler gives no indication of having examined the facts and figures that often have been offered to him, including the several public-record CONFESSIONS of central bank manipulation of the gold market:
http://www.gata.org/node/4279
Instead Nadler now seems to be saying he has been convinced that there is no central bank scheme against gold because he has possession of "pictures of all the gold in Fort Knox." Nadler is not quoted as to where he got those pictures, when they were taken, how much gold they show, and whether the gold shown is encumbered in any way by gold leasing, swaps, or other agreements or understandings among central banks. But since Nadler is so persuaded by pictures, GATA would like to show him one of a piece of property we're selling cheap:
http://tinyurl.com/ya6nln
The Blanchard study of the secrecy around gold lending and its potential for market manipulation and private profit from the abuse of public resources raises compelling questions, and Resource Investor's new report signifies as much. You can find it here:
http://www.resourceinvestor.com/pebble.asp?relid=27735
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
USAGOLD Daily Market Report (1/3/07; 20:27:50MT - usagold.com msg#: 150687)
Page Update!
http://www.usagold.com/DailyQuotes.html
The Daily Gold Market Report has been updated.
If you are considering investments in gold we invite you to request our free introductory information packet detailing the products and services offered by USAGOLD ~ Centennial Precious Metals. We welcome your inquiry and look forward to working with you.
WEDNESDAY Market Excerpts
The February contract closed down $8.20 at $629.80 on the New York Mercantile Exchange, marking its lowest closing level since Dec. 26. The contract reached a high of $647.20 earlier in the session, the contract's strongest intraday level since Dec. 5.
On Tuesday, the contract gained in electronic trading. The Nymex remained closed following New Year's to observe a day of mourning for former president Gerald Ford.
There's a "feeding frenzy of fear in paper equities" that's "drawing traders away from gold and silver" Wednesday, said Ned Schmidt, editor of the Value View Gold Report. "Funds are simply totally afraid of not being fully invested in the first week of the new year."
But "gold beat U.S. paper equities by a significant margin last year, and 2007 will be no different" he said.
Gold futures scored a 23% gain over the course of 2006.
"Dollar movements will be closely watched in the coming sessions," said James Moore, an analyst at TheBullionDesk.com, in a note to clients.
He said gold remains vulnerable in the short term to selling after having moved up on limited volumes over the Christmas period.
---(see url for full news, 24-hr newswire)---
Sierra Madre (1/3/07; 19:41:22MT - usagold.com msg#: 150682)
MK: About bonuses in gold...
Back in the sixties, one Christmas I offered to pay the higher executives of my company their bonus in gold.
They DECLINED. They could not save their bonuses, they had too many pressing needs that required cash. The gold would have made a nice pile, at $35/oz.
But, they never forgot the remarkable gesture which impressed them to no end, especially as they saw how things turned out some years later. One of them still lives.
Once a goldbug, always a goldbug!
Want to become a legend in your lifetime? Buy gold!
SIERRA
Sierra Madre (1/3/07; 19:32:36MT - usagold.com msg#: 150681)
WHAT do the Gold Cartel and Walmart have in common?
They both have the same slogans:
"WE SELL FOR LESS" and "EVERY DAY LOW PRICES"
SIERRA
MK (1/3/07; 19:24:04MT - usagold.com msg#: 150680)
Anyone?
Does anyone remember a story about City of London bonuses being paid in French Napoleons? I remember reading but can't find the reference. Would be greatly appreciated.
Pal (1/3/07; 18:38:01MT - usagold.com msg#: 150679)
Int'l Forecaster Midweek Reading
http://news.goldseek.com/InternationalForecaster/1167850347.php
SNIP
"Had the Fed allowed the economy to be purged via recession in the early 1990s, we would have never had the stock market collapse of 2000 and 2001 and the real estate collapse of 2005-2009. Now we are also facing a credit collapse that should hit once the stock market heads down again. Once the demand for excessive credit ceases that will signal the bursting of a third bubble, all occurring within ten years. The segment to be hit hard during the coming credit collapse will be the financial and services industries. The Fed believes, or would have you believe, that deflation and depression can be avoided by continually increasing money and credit. Not in their wildest dreams. At some point the desire to borrow by business and financial sources will end or there will be some unexpected event, such as a derivatives failure or a hedge fund collapse and the ability to employ this credit will end. When that occurs you will have six months to a year to exit "all" investments except gold bullion coins. While all the foregoing is taking place inflation will rage and gold and silver will rise in spectacular fashion. The fed may be able to print endless supplies of money and credit, but people have to be induced to spend and borrow."
...
"The next two years will be absolutely giant for gold. You will make money you never dreamed of making. This is what betting parlance calls the lock – the-can't-lose bet. The two biggest recipients will be gold and silver shares and numismatic coins, following by silver numismatics, and gold and silver bullion and bullion coins. Share multiples will go ballistic - $850 and $25 will be broken in 2007 and we may well see $1,700 and $100."
"The big physical buyers will buy even more: India, China and the Middle East. All those under 50 years old will finally discover the significance gold and silver and their relevance to inflation and to the deflation flight to quality. Canada, the US and Europe will finally get involved in gold and silver related assets."
ENDSNIP
Bob Chapman gives a good summary of where we are economically and argues that we should seek physical gold and silver ownership.
-Pal
TownCrier (1/3/07; 16:53:47MT - usagold.com msg#: 150678)
US single biggest recipient of petrodollars -study
http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070103:MTFH56973_2007-01-03_22-20-10_N03436127&type=comktNews&rpc=44
NEW YORK, Jan 3 (Reuters) - The United States was the single biggest recipient of investments from oil exporters between 2003-2006, according to a Federal Reserve Bank of New York study released on Wednesday.
With oil revenues, or so-called petrodollars, expected to have reached about $968 billion in 2006 from around $300 billion in 2002, NY Fed analysts Matthew Higgins, Thomas Klitgaard, and Robert Lerman said investments by oil exporters in U.S. assets likely totaled about $314 billion between 2003-2006.
The $314 billion invested in the United States represented less than one-fourth of the more than $1.3 trillion oil exporters invested globally over the three-year period, the largest investment so far.
...The NY Fed study also indicated that most petrodollar investments found their way into the United States indirectly, as countries like Japan, which had received investments from oil exporters, funneled such inflows back to the United States through the purchase of U.S. securities.
On the trade side, oil exporters purchased more goods and services from the euro zone and China, which offset both regions' crude oil imports, the study said.
In the case of China, 60 cents of each $1 in oil purchases sent overseas returned to purchase Chinese goods.
By contrast, just 20 cents of each $1 imported by the United States came back for the purchase of American goods.
^---(from url)---^
The headline seems to paint an overly bright picture given the undelying reality.
And getting to that point about the leven of indirect investments, naturally, once created, a goodly share of those excess dollars sent abroad are going to keep swirling around the international scene as a transactional element until they finally land in New York in search of an interest bearing acknowledgement of our indebtedness (i.e., a bond).
This is hardly a hallmark of a sound financial and economic ordering of affairs.
In all of this can you foresee the new role for gold in the future leveling of the playing field? Take a walk on "The Gold Trail".
R.
USAGOLD - Centennial Precious Metals, Inc. (1/3/07; 15:32:43MT - usagold.com msg#: 150677)
Has the latest USAGOLD NewsGroup reached YOUR e-mail inbox?
http://www.usagold.com/amk/newsgroup-form.html
Do you know...
Who's likening the U.S. to a "banana republic", and more importantly, WHY? ? ?
How has the recent Paulson-Bernanke mission to China given added credibility to this view of a sea change in international fortunes?
Some would say the Fed has become immaterial in the support for and fate of the U.S. dollar. While lower interest rates may be the likely prescription to bolster the slowing sectors (such as housing) of the internal economy, externally, however, John Tamny rightly reminds readers that "if the underlying monetary policy is not credible, there exists no fed funds rate that will shore up the dollar's value. If high rates were somehow a cure, then Brazil, Venezuela, and Lebanon would consistently possess stronger currencies than the rest of the world."
Which brings us to Argentina and the fallout of "banana currency" policies...
Were you aware that a recent Supreme Court decision had savers protesting angrily outside with signs saying "Corrupt, thieves, give us back our savings" and "Remember: the banks robbed you and they'll do it again" ?
_________
You'll have already discovered these items (and more) if you've signed up for the USAGOLD NewsGroup -- the latest issue having been sent this morning.
---------------
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Our NewsGroup attempts to help sort through the the overburden for the few nuggets relevant to your golden portfolio!
It's absolutely free and it neatly bundles the news you can use as a gold owner.
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We invite you to join the others who have taken advantage of our free NewsGroup service by going to the sign-up page linked above.
This time around, we were especially surprised and pleased by the phone calls we've already received today with compliments on this morning's mailing. We certainly appreciate your expressions of gratitude as well as your continuing patronage!
mikal (1/3/07; 15:07:29MT - usagold.com msg#: 150676)
@Goldilox
http://investing.reuters.co.uk/news/articleinvesting.aspx?type=goldMktRpt&storyID=2007-01-03T211328Z_01_L03115045_RTRIDST_0_MARKETS-PRECIOUS-UPDATE-5.XML&pageNumber=0&imageid=&cap=&sz=13&WTModLoc=InvArt-C1-ArticlePage3
Not to worry. 'Tis easily explained! Energy and some other commodities down and volatile. Dollar and stocks up. "Liquidity" issues.
The power elite, er MEDIA are in unanimous agreement! ;)
UPDATE 5- Gold falls, erases early gains, as dollar rallies
Wed Jan 3, 2007 9:13 PM GMT
By Frank Tang and Atul Prakash
NEW YORK/LONDON, Jan 3 (Reuters) --Excerpts: "Gold erased early gains and was quoted lower on the first trading day of the year, as the dollar rallied after a survey showed the U.S. factory sector expanded in December and energy prices fell sharply on Wednesday...
The market's early gain could be attributed to gold buying by a European central bank last month, a period which saw selling of the metal by other central banks in the region under an agreement that limits gold sales.
The European Central Bank said in a statement last week that figures to the week ended Dec. 22 reflected the selling of gold by one European central bank and "a net purchase by another Eurosystem central bank." It gave no further details.
Looking forward, dealers said the market was expected to remain choppy in the coming days.
"Typically market liquidity only properly returns in the second week of January, and a new trading year brings fresh budgets for investors to act on underlying convictions," said Robin Bhar, analyst at UBS Investment Bank.""
mikal (1/3/07; 14:15:53MT - usagold.com msg#: 150675)
Can Democrats make a difference?
http://www.theaustralian.news.com.au/story/0,20867,21009439-1702,00.html
Bush Seeks Backing for US Budget, Iraq
By Steve Holland in Washington | Reuters | January 04, 2007
Excerpt: "WITH Democrats poised to take over Congress, President George W. Bush today used a Rose Garden ceremony and a newspaper opinion piece to try to salvage his domestic agenda and win support for an Iraq policy he has yet to announce.
Speaking at a ceremony after a Cabinet meeting, Mr Bush used the White House stage to draw attention to his domestic agenda by announcing a plan to balance the US budget by 2012. He also wrote a rare opinion article in The Wall Street Journal promoting his new strategy for Iraq.
Mr Bush called upon Democrats to set aside politics, but Democrats, who are preparing to flex their muscle with a legislative push when they take command of Congress tomorrow, responded cautiously. "We hope that when the president says compromise, it means more than 'do it my way,' which is what he's meant in the past," said New York Democratic Senator Charles Schumer."
Mikal-- Politics make strange bedfellows. That is as true in the days when Schumer was just another Congressman as it is now in his leadership position on the floor. Though today Bush announced he will present next month a 5 yr plan for balancing the budget, can anyone take this seriously?
The Democrats could relent in opposition to Bush and the republicans, as they are scarcely a majority in the outset of several rigged midterm elections and have been "bedfellows" as long as there's been Democrats.
But circumstances will be such that both parties wishes will likely be superseded and minimized due to necessity and global orderings.
Goldilox (1/3/07; 14:12:59MT - usagold.com msg#: 150674)
Today's attack
@ mikal,
Of course, if JS' timing is not too far off, one can hardly expect it to come off without a pre-launch attack from the short community, can one?
Federal_Reserves (1/3/07; 14:11:54MT - usagold.com msg#: 150673)
$5 Million Nickel Doesn't Fetch A Cent
http://www.wgal.com/news/10660306/detail.html
ORLANDO, Fla. -- The $5 million nickel isn't worth one red cent. At least not at auction.
A rare 1913 Liberty Head nickel was put on the block at New York-based Stack's Rare Coin Galleries. The nickel was struck secretly at the Philadelphia mint after its design was retired.
Pre-auction estimates pegged the nickel about $5 million. But when bidding started a $4.5 million there were no takers.
mikal (1/3/07; 13:23:39MT - usagold.com msg#: 150672)
Rapid world change
http://www.indiadaily.com/editorial/14996.asp
Just posted by J. Sinclair at his site, this short article is actually a must read IMO for saavy gold investors keying in to geopolitics and energy:
Crude Oil and Natural Gas reserves divided between two superpower blocks - third world war over underwater reserves? | Balaji Reddy | India Daily | January 2, 2007
Excerpt: "It is interesting to note that US reliance on Opec highest in the last twenty years. America imports close to 40% of OPEC production. The strategic interests of America lies in protecting these energy reserves.
At the same time India, China and Bazil have quadrupled energy consumption. These economies are growing very fast. Interestingly, only 10% of OPEC output is consumed by these rapidly growing developing countries."
mikal (1/3/07; 13:05:21MT - usagold.com msg#: 150671)
@Flatliner
Thank you for the links and comments on MiFID yesterday and today. It appears part of the rules go into effect this month and part by Nov 1, 2007.
It applies only to equity exchanges in Europe such as Euronext(#1 European equity exchange in transactions and turnover), London Stock Exchange, Deutsche Borse, Borsa Italiana, OMX, BME, and the remainder.
Still it is fascinating the implications, yes?
From the euronext site, these ideals speak for themselves, and like the concise info at your links, pretty straightforward:
"Markets in Financial Instruments Directive (MiFID), which will be implemented by November 2007, opens competition by introducing a level playing-field between all execution venues in the European Union and reconfigures the trading value chain across intermediaries, brokers, data vendors and investors...
main objective is to create a single market in financial services within the European Union and to provide the marketplace and investors with a higher and more consistent level of transparency whilst ensuring a high quality of execution... Our model has allowed us to build the most liquid marketplace in Europe enabling investors to further develop their domestic as well as their cross-border business in a highly cost-efficient way and ensuring very high market quality, benefiting both issuers and investors."
Flatliner (1/3/07; 12:04:45MT - usagold.com msg#: 150670)
Future stories
http://www.londonstockexchange.com/en-gb/products/membershiptrading/MiFID/
We've all heard the stories where some big trader buys a truck load of metal on the futures markets and then shows up on delivery day only to find that he's turned away because the gold has be loaned out. Thus, to the big trader, the futures markets are a scam and even if they already hold the commodity in question, it doesn't reflect the true supply and demand fundamentals that would exist if it were known that the metal could not be delivered.
My question is, will the Best Execution and Transparency Laws allow big trader legal recourse with regards to this failure to deliver issue? If so, this market would allow big traders a playground in which to fetch metals.
It is clear to me that the systems built around the US Dollar have escape clauses that allow settlement in dollars rather than the actual commodity. This, in my opinion, allows for abuse in the system where big traders can take a loss in one market and offset it with a gain in another – both measured in dollars rather than the commodity itself.
mikal (1/3/07; 11:52:23MT - usagold.com msg#: 150669)
@Goldilox
Good to see you back. Re: "The hammer" and "$650 seems to be the line in the sand"
Your guess is as good as mine but I am in shock and awe today ;).
J.Sinclair thinks we will see
exceptional POG action starting Jan. 15 and frequently hedges that by saying it could occur sooner, or it could start between 1/15 and 1/30- his latest. Repeated often
enough to make me cringe, like other predictions that were less than accurate unfortunately.
I see the Japanese are still on holiday and thin trading and light volumes are not expected to return to normal until next week or the week after. This is important but many other factors apply. MK thinks Chinese buying and world central bank policies will work in our favor. Various signals have been sent regarding the dollar, gold and interest rates as well that he and others discussed.
Geopolitics too, and the situation in oil could easily boomerang(intentionally or accidentally) to provide an excuse for price inflation that comes mainly from competitive currency devaluation/"reflation" injections, teetering as we are on full hyperinflationary recognition and then economic crisis. No intermediate "recession" or "stagflation" this time. The situation today is so disordered that the market action shows desperation and extreme fragility. Anything could happen at any time, and I will not go into the Homeland Security predictions of an inevitable attack or similar ones by other countries including Saudi Arabia.
Flatliner (1/3/07; 11:17:12MT - usagold.com msg#: 150668)
Principles based regulation?
This is a little follow up from my posting yesterday (#150646). After looking a little more into that Transparency Directive, I started following "MiFID". Unfortunately, the documents that are spewed all over the net are less than useful, but the pod cast here: http://mifidpodcast.com/index.php?paged=2, gives a pretty good overview. Unfortunately it's 33 minutes long.
The most interesting part here is that the "Principles Based Regulation" that they talk about seems to hint towards what some key figures in the US talked about no to long ago. I wonder if they are related in any way?
The weird take away from the "MP001 - Introduction to MiFID" podcast is that there is much yet To Be Determined yet the law takes effect this month.
Does this relate to gold or market manipulation? I do wonder. There is a Know Your Client provision in the rules and you must prove Best Execution. Thus, I would guess that if these rules carry over into the commodities markets, much more information will be exposed with regards to WHO trades in the commodities markets. Or, better yet, the information will be traceable for legal research.
I would think that GATA would be all over this!
Goldilox (1/3/07; 10:41:22MT - usagold.com msg#: 150667)
The Hammer!
Obviously, someone felt the $640+ was a little high for comfort, as the Comix 11:00-Noon onslaught has demonstrated!
A number have analysts have remarked that $650 seems to be a "line in the sand", and I don't doubt it. When we bust $650, it's quite possible that we'll be off and running to last May's 700+ figure rather quickly!
Knallgold (1/3/07; 10:01:58MT - usagold.com msg#: 150666)
paper POG
You've got to wonder now if the bearish theory about "pulled support of the $ paper Gold market" by FOA has any sudden truth to it,I mean a possibly bullish story (an ECB bank buying Gold)yields a fat drop in POG.I think we can pull the "possibly" from bullish,it was said its "only a technical" in nature-they're painting somehow confirms me the oppsite,its indeed something relevant,a "first strike" as Sierra Madre suggested.I wouldn't hold any Gold contracts right now,thats for sure...
If they can't bring us past the old high 850 and the often mentioned 1000$/oz target,I think the paper Gold market is toast.
USAGOLD / Centennial Precious Metals, Inc. (1/3/07; 09:25:40MT - usagold.com msg#: 150665)
Make a New Year's Resolution -- LEARN more about gold and DIVERSIFY your portfolio!
http://www.abcs-of-gold-investing.com
Kilo (1/3/07; 08:44:00MT - usagold.com msg#: 150664)
Mr. Ski
I certainly agree with your contention that the 1980 era silver spike was a fluke, an anomaly which may or (more probably) may never be repeated on the same scale. Unfortunately, that same "spike" is used far too often in a marketing sense on those who do not understand or appreciate the (in)significance of "one-time" price spikes.
Still, all things are relative, and "timing is everything" when investing. Similar investments in gold or silver can result in very different returns or losses depending on entry and exit timing as you are aware. Personally, I started buying Mexican 50 Peso AU coins around 1968 as they were one of the readily available "legal" bullion coins at that time and could be had in quantity for a little over $50 per coin. Ah, the "good old days"..... Similarly, I also started buying silver about the same time, then at an average price of about $1.95 per ounce.
Leaving the spikes and dips aside since that time, and looking at the more "orderly" price advance from then to now, we still see gold "up" approximately 1542% in dollr terms while silver continues to lag at approximately 667% over the same time period. Keep in mind, these are my personal figures if you will, and may vary depending on those entry points.
But respective of silver, it has always shown more price volitility than gold for the most part, rising faster in up markets and falling faster on the dips on a percentage basis. THIS VOLITILITY is just what makes silver the better "trade play" and gold the better "buy and hold" in my opinion, though a good case can be made for either at different times and under different market conditions as we both know.
But these figures still fail to take into consideration such matters as inflation, taxes, storage costs, dealer spreads, opportunity costs in the way of lost "cash" interest, and so on. When all is said and done, there is much more to any investment than just "what it cost" vs. "what it's worth" at present. I think too many "investors" fail to take these additional matters into consideration and understand fully why the "buy and hold" is not always the most profitable over time.
Cometose (1/3/07; 07:45:33MT - usagold.com msg#: 150663)
smackdown
given that this is the first trading day of the year and in light of the late smackdown .........
this post smackdown lift is probably an ominous sign....
of the amount of money pouring into this metals bull now
this is a mark in time...
The Chinese New year hasn't begun yet.......
Cometose (1/3/07; 07:34:42MT - usagold.com msg#: 150662)
Raid
Nice push down this morning .......
It would appear that the move prior to this was not bluff and that there are a lot of buy orders backed up in the bottleneck .......
Whoever went into the market first this morning seems to have been able to buy themselves a lower price entry point.
Knallgold (1/3/07; 00:12:20MT - usagold.com msg#: 150661)
On the ECB bought Gold story
"Nikos Kavalis, an analyst at GFMS, said it was too early to tell if the purchase was significant. "We would be cautious about this. These banks have a duty to uphold monetary stability: they're not hedge funds," he said."
What does he mean with that?Monetary stability,I think he meant $ stability/support,did he?Then he better had kept his mouth shot.Now he signified that the ECB probably has pulled $ support and gives a rat about "$ stability".
No,they're not hedge funds,thats why they are going back to Physical Gold.Long live the new stability!
ViewYesterday's Discussion.
