Author Archives: USAGOLD

Today’s Fed Statement

9/20/2017

For the record. . . .

_____________

Information received since the Federal Open Market Committee met in July indicates that the labor market has continued to strengthen and that economic activity has been rising moderately so far this year. Job gains have remained solid in recent months, and the unemployment rate has stayed low. Household spending has been expanding at a moderate rate, and growth in business fixed investment has picked up in recent quarters. On a 12-month basis, overall inflation and the measure excluding food and energy prices have declined this year and are running below 2 percent. Market-based measures of inflation compensation remain low; survey-based measures of longer-term inflation expectations are little changed, on balance.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. Hurricanes Harvey, Irma, and Maria have devastated many communities, inflicting severe hardship. Storm-related disruptions and rebuilding will affect economic activity in the near term, but past experience suggests that the storms are unlikely to materially alter the course of the national economy over the medium term. Consequently, the Committee continues to expect that, with gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace, and labor market conditions will strengthen somewhat further. Higher prices for gasoline and some other items in the aftermath of the hurricanes will likely boost inflation temporarily; apart from that effect, inflation on a 12-month basis is expected to remain somewhat below 2 percent in the near term but to stabilize around the Committee’s 2 percent objective over the medium term. Near-term risks to the economic outlook appear roughly balanced, but the Committee is monitoring inflation developments closely.

In view of realized and expected labor market conditions and inflation, the Committee decided to maintain the target range for the federal funds rate at 1 to 1-1/4 percent. The stance of monetary policy remains accommodative, thereby supporting some further strengthening in labor market conditions and a sustained return to 2 percent inflation.

In determining the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to its objectives of maximum employment and 2 percent inflation. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments. The Committee will carefully monitor actual and expected inflation developments relative to its symmetric inflation goal. The Committee expects that economic conditions will evolve in a manner that will warrant gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run. However, the actual path of the federal funds rate will depend on the economic outlook as informed by incoming data.

In October, the Committee will initiate the balance sheet normalization program described in the June 2017 Addendum to the Committee’s Policy Normalization Principles and Plans.

Voting for the FOMC monetary policy action were: Janet L. Yellen, Chair; William C. Dudley, Vice Chairman; Lael Brainard; Charles L. Evans; Stanley Fischer; Patrick Harker; Robert S. Kaplan; Neel Kashkari; and Jerome H. Powell.


USAGOLD note:  In summation searching various sources, one more quarter point hike this year. Three next year possibly.  A gradual unwinding of the Fed’s $4.5 trillion balance sheet at $10 billion per month beginning next month and then gradually moving up quarterly $10 billion until it reaches $50 billion per month.  At that rate, it will be the mid-2020s before the balance sheet is “normalized” assuming of course life, politics and a bad economy do not intervene.

Could this be a message in a bottle delivered to Wall Street – a surreptitious exit of the party with the punch bowl when few are looking?

Upcoming problems break into two columns –  the psychological effects on the financial markets as this gets sorted out, and the knock-on effects no one foresees. No “been there, done that” to which we can all refer in this situation. . . . . .

It [the Fed’s balance sheet liquidation program] could be more disruptive than people think. . .That is a very different world you have to operate in, that’s a big change in the tide. All the main buyers of sovereign debt over the last 10 years – financial institutions, central banks, foreign exchange managers – will become net sellers now.” – Jamie Dimon, J.P. Morgan

“The faster growth never arrived despite Fed predictions for years that 3% annual GDP growth was right around the corner – in what has been the slowest expansion on record. But prices have risen in stocks, real estate, emerging market plays and other assets.  If the Fed calls that success on Mr. Bernanke’s terms, then shouldn’t the reverse happen as the Fed unwinds?” – Wall Street Journal editorial 9/19/2017

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Morning Snapshot: Gold moving sideways early

Gold continued to move quietly higher this morning with most of the markets waiting around to hear from the Fed.  Gold is trading in $1312 range up slightly from yesterday. Silver is trading flat at $17.32.  Gold reversed course late yesterday after President Trump’s latest salvo leveled at North Korea, coming off a low in the $1306 range yesterday.

The Fed will announce its policy decisions today noon MT and Chairwoman Janet Yellen will hold a news conference at 12:30 MT.  We may have more for you then . . .

No surprise to readers who follow the USAGOLD blog, but confirmation neverthesess:

“Speculative positioning in gold,” reports Economic Times, “has been on the rise since mid-August wherein hedge funds and money managers were net longs at 138,566 contracts, which has now increased to 249,588 net longs as on September 5, clearly defining the road map for rising price of the yellow metal.

As far as investment demand goes, inflows in the SPDR gold trust have grown by 22 tonnes since August and the current holdings as on September 14 stood at around 838.64 tonnes, reflecting the incremental demand arising out of geopolitical worries.”

USAGOLD note:  We are not sure we would go along with the “demand arising out of geopolitical worries” as the chief reason professional investors are gold – a rather simplistic view.  There is considerably more going on with respect to gold than the roller coaster ride imposed by the North Korean situation.  Geopolitical concerns are one of many in the list of gold investor concerns – an important one but still on a longer list of factors.

 

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Gold reverses course after Trump speech

LATE REPORT

Gold reversed its downtrend late today after President Trump threatened North Korea with total destruction in a pivotal speech before the United Nations.  The threats pushed aside concerns about this week’s Fed policy meeting, at least momentarily.

Gold finished the day  up $3.53 at the $1311 mark  after tracking as low $1306 during daytime trading.  Silver followed gold’s lead finishing up 11¢ on day at $17.29. The reversal extended into Asian trading with gold tacking another $2 on the price as this is posted.  Silver is trading sideways.

Quote of the Day
“It would therefore take a huge leap of faith to say that crises won’t continue to be a regular feature of the current financial system that has been in place since the early 1970s. The near exponential growth of finance and its liberalisation since this point has encouraged this trend.” – James Read, Deutsche Bank strategist


Wondering what Deutsche Bank’s James Read is talking about?  Try this USAGOLD link. . . .Black Swans – A chronology of panics, mania, crashes and collapses from 400 BC to present.  The prudent are prepared.

Also, we invite you to sign-up for our monthly newsletter available free with appreciation to our current and prospective clientele. Immediate access. Therein, comments and concerns like Mr. Read’s are covered regularly.


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Sell-off pushes gold, silver lower

LATE REPORT

Gold traded down today on concerns about the upcoming Fed meeting – off $15.67 at $1307.40.  Silver took an even bigger hit on a percentage basis, down 36¢ on the day at $17.18.  In early Asia trading both are sideways at the $1309 and $17.20 levels respectively.

Gold’s sell-off started early in the day and did not encounter resistance until the price neared the $1300 level.  Ordinary profit taking should not be ruled out.  Reuters reports tonight that Friday’s “U.S. data showed hedge funds and other speculators had raised net long positions in the precious metal for nine straight weeks.”

Correction aside for a moment, gold is up for the year when measured in the major currencies.  Here is the scorecard through today’s trading:

British pound –> +4.8%
Euro –> +2.7%
Japanese yen –> +10.3%
Chinese yuan –> +10.6%
US dollar –> +13.6%

For more insights on today’s market activity, please scroll below. . . . . . .

Quote of the day
“A disgraceful milestone was reached this week when US government debt busted through the $20 trillion level and quickly went over $20.1 trillion. Can $21 trillion, or $25 trillion, be far ahead? Why not $40 trillion, so our grandkids and their grandkids can be even more indebted to the Chinese and other countries that buy our debt but aren’t very nice to us.” –– John Crudele, New York Post


“Few Americans know that, just after World War II, the United States owned most of the gold bullion on earth – about 22,000 metric tonnes.” So begins the September issue of News & Views under the headline When the United States Owned Most of the Gold on Earth.  What happened next laid the foundations for today’s massive federal government debt, a long-term secular bull market for gold and a long-term secular bear market for the dollar.  Herein lies the essential rationale for gold as a long-term portfolio asset, safe haven and friend to the concerned citizen.

For the full article and much more, we invite you to sign-up for our free newsletter available with appreciation to our current and prospective clientele. Immediate access.


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Gold, silver quiet in Asia to start the new week, Fed meeting on the agenda

LATE REPORT

Gold is down a tad in the overnight Asian market – off about $2 at $1318.60.  Silver is steady at $17.60.  A quiet night in the gold market thus far.

This week we have the Fed meeting – always a tricky, unpredictable event for the precious metals. Interest rates apparently are off the table.  The Fed, though, is expected to announce its plan to liquidate the $4.4 trillion in assets it acquired putting out the fires of the 2007-2008 debt crisis. Alan  Greenspan once referred to it as a “pile of tinder.” QE comes back to haunt the Fed and the financial markets – the ghost of crises past.

Quote of the day
“It [the Fed’s balance sheet liquidation program] could be more disruptive than people think. . .That is a very different world you have to operate in, that’s a big change in the tide. All the main buyers of sovereign debt over the last 10 years – financial institutions, central banks, foreign exchange managers – will become net sellers now.” – Jamie Dimon, JP Morgan


If you are a chart enthusiast, we have a couple pages at the USAGOLD website worth bookmarking.  These charts are presented in conjunction with the St. Louis Federal Reserve (FRED) and update automatically through the magic of the internet.  Both pages are  handy references used regularly to settle after-dinner disputes among family members and friends about the direction of the economy.

Gold trends and indicators in chart form

Monetary trends and indicators in chart form

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Seesaw week ends on a down note for gold, silver

LATE REPORT

A seesaw week for gold ended today on a down note. Gold was off $13 from yesterday’s closing number in $1320 range. It began the week at $1321.  Silver followed suit ending the week at $17.57 – down 19¢. It was down 25¢ on the day.  Lest we forget, both metals were coming off highs for the year achieved last week. Profit-taking and contrary positioning are bound to show up on such occasions.

Professional investors, on the other hand, appear to be treating the seesaw action as a buying opportunity.  The GLD-ETF, where funds and institutions tend to concentrate their purchases, is up 4 tonnes over the past few days.

Next week we have the FOMC meeting.  Things could get interesting. . . .

Quote of the Day
“Gold and silver are in the beginning of these two [bull market] phases known as ‘Relief & Optimism’ which lasts another 2-3 years as the market begins to hit higher highs with sustained gains for longer periods of time and with fewer and shorter term pullbacks as investors begin to gain confidence and more people start to jump in, most of whom are usually professional investors such as hedge funds and money managers while the general public continues to ignore it.” – Commodity Trade Mantra (Are you still worried if gold is in a bull market? Let me show you.)


Last Friday the national debt surpassed $20 trillion with a massive one day addition of $318 billion.  In the September issue of our newsletter, we  shed light on why the national debt matters – an often overlooked consequence to the now immense load of red ink. We invite you to sign-up for our free newsletter available with appreciation to our current and prospective clientele. Immediate access.


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Japan snapshot: Flight to safe havens – gold, dollar

Yen drops like a rock . . . .


(Quoted in number of yen purchased with one dollar.  Yen declining when trend line is rising.)

. . . . while gold in yen jumps higher

(Chart courtesy of GoldChartsRUs)

See GOLD TODAY! One stop LIVE prices, charts, news & opinion (includes currencies)


 

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Gold jumps late on latest North Korea provocation

LATE REPORT

Gold jumped higher late today in response to the latest North Korean missile launch over Japan. It was already in recovery mode earlier today on favorable interpretations of two key government reports – consumer prices and jobless claims. At this posting, gold is trading in the $1331 range and up about $8 from yesterday’s closing levels.  Silver is up 7¢ from yesterday’s levels at $17.84.

Gold’s been on the proverbial seesaw this week, but on balance showing persistent underlying strength.  Asian trading is surprisingly quiet so far this evening. . . . .

Quote of the Day
“Although we respect the Fed’s independence we are concerned about economic growth. We’re doing everything we can — whether it’s tax reform, whether it’s regulatory relief, whether it’s trade — to create economic growth. And we’re less concerned about inflation at the moment.” – Treasury Secretary Steven Mnuchin


If you are new to the USAGOLD website, we invite you to kick back and stay awhile. Do a little interest-driven browsing.  We launched this website in 1997 and it has dutifully been providing guidance and market information to investors ever since.  One of the most highly referenced and visited web portals in the gold business, this website goes deep.  People are often surprised just how deep it goes.  As a launchpad, we offer a quick website tour that hits the high points and suggests links, but it’s the depth, practicality and ease of use that will keep you coming back.  WELCOME!


 

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Gold off today on profit taking, silver following suit. All’s quiet in Asia.

LATE REPORT

Gold had another minor reversal today at the hands of speculators taking short term profits. Silver tracked back as well, but less so.  Gold as this is posted is trading in the $1320 range – down about $11 on the day.  Silver is down about 15¢.  There was not much in the way of news.  Asian gold and silver markets are quiet again tonight – trading sideways.

Scroll down for a more detailed look at today’s events.  The post by USAGOLD founder, Michael Kosares, on William White’s recent Bloomberg television interview is worth reading. White says the economy is facing “more dangers now than 2007.”


Here are a couple of overlay charts – one on the year thus far and the other since 1970 – for newcomers who would like to better understand the oft-referenced correlation between the US dollar and gold.  Note particularly the distinct downtrend in the dollar against the other major currencies in the index since 1970 and against gold. That’s the real story.

(Please see “Surprise gold advocates” for portfolio advice from a couple folks in the know.)

Chart note: Despite all the discussion about beggar-thy-neighbor currency policies carried out by America’s competitors, it is the dollar – not the other major currencies  – that has suffered the worst depreciation since 1970.  The one year chart shows a similar relationship only over the shorter term.  The long term chart includes trend lines from 2000.


If you would like to see our take on what’s pushing gold and silver these days, you might want to sign-up for our free newsletter, available with appreciation to our current and prospective clientele. Immediate access. Weeks ago, we took the emphasis off North Korea (though we didn’t eliminate it as a cause) and put it on five other more enduring factors.  Those are the factors covered in the newsletter.  It was interesting to see that Goldman Sachs took the same tack last week.  (This gold note is under the heading, What is behind the ‘quiet’ summer rally in gold and silver.)

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Gold, silver subdued in Asia tonight

LATE REPORT

Coming off lows early today at the $1320 level, gold is now trading $14 higher in the $1334 range.  Silver followed suit ranging from a $17.70 low to trade at $17.84 as this is posted. The sharp, quick reversal in gold and silver will raise an eyebrow or two. The overnight market, though, is subdued.  Nothing much to report except for the Japanese yen taking a major hit today contributing to gold’s reversal.  For a short time, it broke the psychologically important 110 per $ mark.

From an Investopedia report today:

“When times get tough, even some of the most prominent investors turn to safe alternatives. Now, Bridgewater Associates founder Ray Dalio has urged investors to consider picking up gold in light of heightening tensions between the U.S. and North Korea. The billionaire feels that the financials markets are at risk considering increasing geopolitical tensions both domestically and abroad, particularly in Asia.”

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Gold level in Asian trading after today’s push to lower levels

LATE REPORT

Gold is level in overnight trading after today’s push to lower levels.  Gold is  presently trading down $12 on the day at $1325.60 in FOREX trading.  Silver is down 21¢ at $17.81.

For the most part, today’s market action appears to be a correction from the 2017 highs gold posted end of last week. Traders in futures markets are cashing in profitable positions.  We shall find out whether or not the trading over the past two sessions will develop into a real correction.  The jury is still out. . . .

In a rather odd development, China apparently signaled speculators permission to short the yuan, according to a Wall Street Journal report this morning. The yuan is down sharply overnight in FOREX trading.  File this one under be careful what you wish for. . . . . .

The Treasury Department’s announced late this afternoon that the national debt transcended the $20 trillion level with a whopping $318 billion one time addition.  It looks like the federal government did not waste any time taking advantage of the Congressional go ahead to raise the debt limit.

From the Treasury Department:

In the September issue of our newsletter, we briefly shed some light on why the national debt matters – an often overlooked consequence to the now $20 trillion load of red ink. We invite you to sign-up for our free newsletter available with appreciation to our current and prospective clientele. Immediate access.

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Gold off in overnight trading

Gold is trading down about $7.50 in the overnight markets as this is posted. Silver is down 7¢.  It looks like Irma’s reduced category ranking to a 2 and quiet on the Korean peninsula let a little air out of the gold and silver rallies – at least for now. Too, it could be no more complicated than a continuation of Friday’s sideways to lower trading.

In Japan, stocks are up a little over 1%. Despite that strength, the yen is taking another beating in the FOREX markets.

As pointed out here a few days ago, the weak yen has been a consistent contributor to higher gold prices in overnight Tokyo trading. That post includes a worthwhile chart, if you haven’t seen it. It will be interesting to see if yen weakness wins out as the evening progresses.

Nothing much going on elsewhere at this writing.  Will report back if anything develops. . . . . .


Interesting quote from Goldman Sachs chief commodity analyst, Jeff Currie –

“If buying gold, don’t buy futures or ETFs.  Buy the real thing. . .The lesson learned was that if gold liquidity dries up along with the broader market, so does your hedge, unless it’s physical gold in a vault, the true hedge of last resort.”

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Gold + silver: The numbers – today, the week, the year –> catch-up below

Gold and silver traded sideways to down today after a solid week.  Gold finished the week up 1.9% ($1,321.21 ––> $1,346.29, +$25.08); silver finished the week up 2.2% ($17.55 ––>$17.95. + 40¢).  Gold’s upside Asian strength was blunted first in European trading then in New York on a slow day in most financial markets.

On the year thus far, gold is up 17% ($1,150.90 ––> $1,346.29, +$195.39); silver is up 13% ($15.90 ––> $17.95, + $2.05)

As for the events pushing gold and silver prices Monday through Thursday, we think you will find plenty to chew on in the long and illuminating roster of posts immediately below.  You can develop you own list of protagonists.

One quick comment on gold and silver’s performances since the beginning of the year:

The fact that gold has outperformed silver points to an apparent safe-haven bias among investors which, in turn, suggests a disinflationary bias toward the economy and financial markets.  We think that bias is in keeping with reality.  However, silver could play catch-up when private investors finally catch-on that something is going on.  This rally is led by global professional investors who are matching their public warnings about an overvalued stock market with diversifications into primarily gold via various investment avenues, including physical metal.  Both gold and silver have outperformed the stock market thus far in 2017.

DJIA (19,762 ––> 21,797, + 10.2%) (Surprise!)


If you would like to see our take on what’s pushing gold and silver these days, you might want to sign-up for our free newsletter, available with appreciation to our current and prospective clientele. Immediate access. Weeks ago, we took the emphasis off North Korea (though we didn’t eliminate it as a cause) and put it on five other more enduring factors.  Those are the factors covered in the newsletter.  It was interesting to see that Goldman Sachs took the same tack this past week.  (This gold note is under the heading, What is behind the ‘quiet’ summer rally in gold and silver.)

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Tokyo gold market

Given the growing importance of the yen/gold trade in Japan and the influence it has in the overnight market for the United States, we have added the Tokyo Commodity Exchange (TOCOM) hours of operation and a Tokyo time clock to our Gold Trading Hours page.

Your visits to the page are welcome.  It is a handy reference that gets quite a bit of global traffic.

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Gold up overnight in Asia on yen strength

Gold showing overnight strength. Up about $4.00 as this is written, broke $1350 at $1353.  Silver trading over $18 at $18.18. Gold and silver both registered unusually strong performances today in New York trading.  Gold was up $14 and silver was up 30¢.

Gold strength in overnight Asia trading has shown a consistent pattern over the past few months with much of the strength coming from a strong Japanese yen.  For years, Asia has pretty much  followed the New York/London lead which flattened the overnight (Asia) price flow. Things have changed.  Some analysts have begun to refer to the yen as a “safe haven.”  That might seem counter-intuitive given the situation in which Japan finds itself next door to North Korea, but the market calls the tune.  Of course there’s no safe haven like gold, and that’s why investors are buying it. (Gold is up in yen over this period.)

Take a look at the overlay immediately below.  It tells an interesting story. Keep in mind that the yen is quoted in yen per dollar, so the yen overlay looks inverse. The chart downtrend (red line) is really an uptrend and vice versa. Note the direct relationship between the yen and the gold price. Tonight’s jump in gold neatly coincides with the yen’s improvement.


For the full picture on gold strong performance today, please scroll below. Pete Grant’s Daily Market Report is a must read today!


We’ll keep an eye on this chart and you can too here.  Play with the chart tools.  You’ll figure out how to draw it yourself.

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When the United States Owned Most of the Gold on Earth

Gold’s legacy told indelibly in one straightforward chart

by Michael J. Kosares
Author, The ABCs of Gold Investing: How To Protect and Build Your Wealth With Gold
Founder, USAGOLD

Few Americans know that, just after World War II, the United States owned most of the gold bullion on earth – about 22,000 metric tonnes. In fact by 1945, it owned over 80% of the gold held by nation-states and central banks – an impressive display of economic power. Now it owns just over 8000 metric tonnes, which represents about 42% of the total global reserve.

The lost 14,000 tonnes were expended in defense of the $35 per ounce gold benchmark price established under the 1944 Bretton Woods Agreement. In addition to the fixed price of gold, the U.S dollar came to represent a fixed weight of gold, i.e., 1/35th of a troy ounce, and the rest of the world’s currencies were then pegged to the dollar. The United States agreed under Bretton Woods to redeem gold from the other signatories at the rate of $35 per ounce should any of the participants determine that gold might be a better alternative for a portion of their reserves than U.S. dollars. “The dollar,” American policy makers were wont to say, “was as good as gold.”

Germany, France get the idea dollar not as good as gold

All proceeded in orderly fashion with little in the way of redemptions from the massive U.S. stockpile until the 1960s. Then a group of European nation-states, led by Germany and France, got the idea that U.S. inflationist economic policies had undermined the dollar, making gold a bargain at $35 per ounce. In other words, they came to the conclusion that the dollar was not as good as gold.  Steadily, over a decade long period, they exchanged dollars for gold at the U.S. Treasury’s gold window. By the early 1970s, 14,000 tonnes of gold – or 64% of the stockpile – had departed the U.S. Treasury for European shores never to return.

In 1971 President Richard Nixon finally decided enough was enough. He closed the so-called gold window, devalued the dollar against gold, and freed the greenback to trade at market prices against other currencies. Fully abrogating the Bretton Woods Agreement, Nixon declared, in one of the more famous quotes of his presidency, “we are all Keynsians now.” The era of global fiat money, with a fiat U.S. dollar as its centerpiece, had begun.

Had the United States refrained from its defense of the $35 benchmark, it would still own about 75% of the present 29,000 tonne global gold reserve. As it is, Nixon’s revocation of the Bretton Woods architecture set the stage for the modern gold market. You can see the result in the chart immediately below. From it, I can draw three conclusions:

–– First, we are now in the 46th year of a super-cycle, secular bull market in gold that began in 1971 – a bull market directly tied to the fate of the now fiat U.S. dollar.

–– Second, the very same conditions which created that bull market are still in place today – nothing has changed fundamentally.

–– Third, as long as the same cause and effect remain in place, we can assume gold will continue to make sense as a long-term portfolio hedge.

Some will agree with those conclusions. Some will not. Some are on the learning curve, and it is to that group this piece is largely addressed.

Chart courtesy of GoldChartsRUs/Nick Laird with thanks

In the end, it is the times that need to be hedged

Those who do not agree with those conclusions, it has been my experience, will continue to put their faith in the stock and bond markets and ignore the precious metals. There is no amount of persuasion that will convince them to do otherwise, and to try is pretty much a waste of time. Most importantly, whether they care to acknowledge it or not, they will put their faith ultimately in the federal government and the Federal Reserve.

Those who do agree will continue to hedge their portfolios with the precious metals, just in case the long history of economic breakdowns beginning with 1971 repeats itself yet again. To this group, the proper diversification is a small price to pay, a matter of practical financial planning that, in these times, provides some much-needed peace of mind. As for an end game to all this, they will keep in mind one of history’s immutable lessons – sometimes the problems become too large for the government and central bank to control.

For those on the learning curve, a post I made at the USAGOLD blog recently titled “Historical inevitability and gold and silver ownership – In the end it’s the times that need to be hedged” would be an informative follow-up to what you just read, another piece in the puzzle. It got significant play on the wider internet and speaks to the possibilities of an end game from the perspective of Strauss and Howe’s fourth turning.


You have just read the lead article for the September edition of News & Views – USAGOLD’s monthly newsletter.  To gain immediate, FREE  access to the rest of the newsletter, we invite you to  to sign-up here.   In this month’s chart rich edition, we cover the ‘quiet’ summer rally in gold and silver; the dramatic shift in central banks’ role in the gold market since the 2008 financial crisis; the relevance of the upcoming Shanghai Exchange oil futures contract convertible to gold. . . .and more.  All from the perspective of the gold owner.


One more chart for those who want the complete picture:

Chart courtesy of GoldChartsRUs/Nick Laird with thanks

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Gold continues uptrend today, up almost 18% on the year

Decent day today. Gold continued its uptrend improving by $8.74 at $1341.57 and showing carryover strength, at this writing, in the aftermarket.  Gold, as shown in the chart below, is trading at 2017 highs and up almost 18% on the year. Asia opens momentarily. It will be interesting to see if we get carryover from U.S. trading.

Stay tuned. . . .We’ll update if anything interesting develops.

There are a number of other factors at work in the gold market. Scroll below for full details.

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Gold, silver up in Asia trading

North Korea announces successful H-bomb test.

Gold is up $10.80 at $1335 this posting.  Silver is up 17¢ at $17.89.  Dollar trading lower against yen, euro . . . . .DJIA futures  down 75.

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Gold gets strong bounce off $1300 level today, silver in tandem

Good day today. Gold up $14 at $1321 per ounce.  Silver up 18¢ at $17.55 per ounce. Gold mounted a defense of the $1300 level in overseas trading that carried over to day time trading in the United States. (first chart below)  Silver traded in concert with gold.

The metals also closed out a strong month coming out of the annual summer doldrums with a solid move to the upside (second chart below.)  For the month of August, gold is up 4% (+$53.00) and silver is up 5% (+87¢).

For more detailed information, please scroll below. 


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Strike gold on your smartphone

USAGOLD’s mobile market monitor

Our mobile pages are one of the hidden gems at the USAGOLD website.  Principally designed as a service to our busy clientele, Google picked up on several pages ranking them one to three under mobile searches. Those search listings refer a steady stream of new visitors daily. It is very user friendly and delivers up-to-the minute prices, news and opinion  on the gold market.

We welcome your visit to our mobile hub page. From there you can navigate to the pages that interest you when you are on the go. . . . .

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Gold rally gathers pace in overseas trading

Gold is up about $7 in overseas trading at $1325.  Silver is up another 12¢ at $17.63 as metals’ strong performance yesterday carried over to trading in Asia and Europe.  At this posting, DJIA futures are off 135 and the euro is trading at the $1.20 mark.  Scroll for more. . . .

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After hours gap-up in gold price

Gold gapped up in after hours trading driven by North Korea’s ballistic missile launch over Japan.  Gold is up $26 at $1317 on the day.  Silver is up 45¢ at $17.49.  Gold had already registered a strong performance today on factors covered below.


If you are new to USAGOLD, our Gold Today! page is a good place to follow the gold price action in real-time.  The page includes a constantly updating news feed with lots of news and opinion from solid sources in the U.S. and overseas.

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Where to buy gold

A quick guideline for choosing the right gold company

by Michael J. Kosares
Author, The ABCs of Gold Investing: How To Protect and Build Your Wealth With Gold, and founder of USAGOLD

Updated Q3-2017

It is surprising how many prospective investors simply dive into gold and silver investing without much in the way of a consumer inquiry. That lack of simple due diligence has ended up costing a good many investors thousands of dollars, and sometimes even hundreds of thousands, before the damage is detected. Below you will find some brief but valuable guidelines to help you choose the right gold and silver company. It might be the most important decision you will make on the road to becoming a gold and silver owner.

Choose a company that has a solid track record

Ten years in the business is good; fifteen years or more is even better. Avoid the newcomers, the flashy discounters and the complicated online coin shops. These outlets are designed more for collectors and dabblers – or buyers out to make a quick, online purchase – than serious investors looking to hedge their portfolios.

Choose a company with a solid track record and longevity. It is the mark of a well-run business committed to its clientele.

Choose a company with strong credentials and a reputable history

A simple background check can go a long way in helping you circumvent a company with a history of problems and poor customer service. A quick visit to the Better Business Bureau’s online website can do wonders and save you a major headache down the road.

The BBB provides consumers with a company’s basic rating, verified online reviews and a list of complaints. (If a company does not have a BBB rating, treat it as a red flag.) Pay special attention to the complaints and how they were handled even if the company has managed to maintain a high rating.

A good many precious metals’ businesses that have gone bankrupt, or found themselves in legal difficulties in recent years, showed signs of something being wrong long before-hand in their rating and complaint record. Oftentimes, the BBB will post a warning about such businesses.

BBB reviews are another good source of consumer information. Make sure that the reviews are verified and noted as such by the BBB itself. Too often businesses stack their review section with reviews that have not been vetted officially by the BBB.

Choose a company with strong BBB credentials. Now more than ever, reputation matters.

Choose a company willing to spend time with you and answer your questions

The company that is abrupt at the outset is the company likely to give you short shrift in the future when you have a question or concern that needs to be addressed. Be especially wary of companies that use aggressive sales tactics. Seek out and develop a relationship with a company that handles your inquiry in a friendly, professional manner.

Choose a company willing to work with you. It will provide helpful guidance now and peace of mind in the future.

Choose a company willing to accomodate your timing

Even if you think that you might want to make a purchase at some point in the future, but for whatever reason are not ready now, it would be best to vet candidates ahead of time. By doing the spadework, you will know where to call when the time comes. It is also advisable to do some advance planning with respect to the specific items you might want to add to your portfolio.

Choose a company willing to be patient with your timing needs. It will be there for you when you need it. Hurried decisions made in the heat of a media-driven gold and silver frenzy can lead to mistakes. (Of course, the ideal is to follow the old rule: The best time to buy gold and silver is when everything is quiet.)

Choose a client-oriented company geared to helping investors

Many online companies are happy to take your order (no matter what it is) and then It’s good luck trying to make contact and get information when you need it – particularly when it comes time to sell or track a late delivery. Mostly interested in quick turnover, customer-oriented companies are order-takers rather than experienced, professional advisors. Client-oriented companies, and there are still a few around, tend to take more of an interest in developing a relationship that will serve both parties over the medium to long run.

Choose a company that takes an interest in you as a long-term client rather than a one-time customer. There is a great deal of difference between the two particularly if your goal is to become a successful gold and silver owner.

Choose a company that will not divert you from your objectives

Most investors come into the gold and silver market looking for a way to preserve their assets from potential financial or economic threats. Not every gold company, however, has asset preservation as its top priority.

Some tout leveraged accounts or high-end numismatics, for example, or graded and over-priced contemporary bullion coins, off brand bullion bars and jewelry items (to name a few of the wrong turns often taken by first-time investors), none of which serve the safe-haven aspirations of most gold and silver owners.

Choose a company that thinks like you do. Keep it simple. Buy well-known and established physical coins and bullion with a broad international market. Stick with highly liquid items and take delivery. It will enhance your chances at success.

Choose a company whose website you have explored

Before you even contact a gold company, it would serve your best interest to determine the real nature of its business. You can learn much by browsing a website and determining whether or not the company might be a good fit.

Choose a company with a well-run, agreeable website but don’t forget the rest of the due diligence outlined above.

Final Word

Choose the right company and it will help you stay the course on protecting your assets from economic uncertainties. Choose the wrong company and you can suddenly find yourself with more than you bargained for. Don’t jump in. Choose wisely. Choose carefully.

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Gold Week in Review (video), August 08, 2017

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Gold Week in Review (video), July 28, 2017

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In gold we trust – 2017

by Ronald-Peter Stoferle and Mark J. Valek, Incrementum

“The highly normal is becoming abnormal.”
Claudio Borio, Bank for International Settlements

“We believe that the monetary tsunami created in the past years, consisting of a flood of central bank money and new debt, has created a dangerous illusion: the illusion of a carefree present at the expense of a fragile future. The frivolity displayed by many investors is for example reflected by record-low volatility in equities, which have acquired the nimbus of being without alternative, and is also highlighted by the minimal spreads on corporate and government bonds. Almost a decade of zero and negative interest rates has atomized any form of risk aversion.”

With that Stoferle and Valek set the stage for their widely anticipated annual review of the international gold market. We invite you to explore their analysis, prospects and conclusions at the link below:

In gold we trust 2017


* Incrementum offers a complimentary subscription for upcoming gold reports, as well as gold-chartbooks at:  https://ingoldwetrust.report/en/

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June 2017 Special Offer

Update (6/7/17, 5:10 pm MT):  U.S. $5 Liberties over half sold out.  Strong response.


U.S. $5 Liberties
Time to buy. Premiums have fallen to all-time lows. Limited availability. 

“In recent weeks, the premium on pre-1933 $5 Liberty gold coins in AU/Uncirculated condition has fallen to an all-time low, prompting us to recommend them for bulk purchase for the first time in over a decade. . . .  (MORE)


Gold American Eagles (1 oz)

Discounted $7 per one ounce coin.  200 available.  Free shipping at 10 or more ounces purchased. . . . . (MORE)


Please call the ORDER DESK to reserve your order.
First-come, first-served.

1-800-869-5115
Extension #100

You also pay by credit card by going to either of the two links posted above.

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The story behind continuing strong bullion coin demand

2016 was a very good year for both gold and silver in aggregate global mint sales

by Michael J. Kosares

I have always considered sales of modern gold and silver bullion coins a bellwether on the general health of the global precious metals market. In reality, though, bullion coin sales comprise only a very small portion of the physical gold and silver markets. According to the World Gold Council, modern gold coins make up only about 13% of investment demand and a little less than 5% of overall demand.* Yet, as is often the case in statistical inquiry, it is the small and often unobserved, sometimes even ignored, that can accurately tell the larger story – particularly when it reflects the net effect of human action within the greater economy and financial markets.

So how is it that such a small aspect of the global gold market in terms of the overall volume can at the same time be so important?

In a nutshell, it is because the demand among ordinary private investors is telling us something very important: The level of confidence people have in the economy and the plan being carried out by the central planners in charge. Twentieth-century economist Joseph Schumpeter (1883-1950), most famous for his theory of creative destruction in capitalist economies, said it best: “The modern mind dislikes gold because it blurts out unpleasant truths.” I am quite certain that the “modern mind” to which Schumpeter referred was a collective term for the social and economic planners responsible to this day for the construction and maintenance of the fiat money economy.**

With that for initial spade work, let’s take a look at the demand for modern gold and silver bullion coins to see what they might be “blurting out” at this juncture in economic history. First and foremost, the numbers tell us that though Washington and the mainstream media may have recovered psychologically from the 2007-2008 crisis, the investing public has not. In fact, by implication the numbers tell us that concerns about a repeat, or better put, an extension, of that crisis still run high among investors.

The charts depict two different eras for gold and silver bullion coins – the one before the crisis and the one after. The strong consumption in 2016, in that respect, is decidedly a continuation of a well-established trend that began in 2008. For gold, 2016 was the fifth best year on record in terms of sales and in a virtual dead heat with 2015. For silver, 2016 was the fifth best year on record coming after last year’s record sales. Since 2016 was a relatively calm year in financial markets, the question arises how high demand might go if another crisis were to suddenly ignite.

Another lesson in these charts, and one that should not be overlooked, is that the record performances in both precious metals since 2008 did not occur in an inflationary environment, but in a distinctly disinflationary one. The strong and continuing post-crisis demand, running consistently at five to nine times pre-2007 levels, belies the mainstream media’s unremitting mantra that the precious metals are an inflation hedge and inflation hedge only. In that regard, silver is the big surprise. Prior to the current period, silver was generally viewed as an industrial metal with some investment potential and rarely a safe-haven or crisis hedge. Now investors give silver nearly the same credence they do gold for asset preservation purposes.


FREE SUBSCRIPTION and access to this month’s edition of News & Views.  This month we explore the big issues in Washington and how they are likely to affect gold in the months ahead; the mechanics of how algo-trading might create a stock market panic and much more.   Several timely charts are included. We invite your free subscription at no obligation.


* These totals include only current year bullion coins and does not include the large volume in previous mintages traded in the secondary market globally. There is no accurate accounting available for the secondary market, but it would add significantly to the annual turnover demand if it were tracked.
** Complete quote: “In the first place, the ‘classic’ writers, without neglecting other cases, reasoned primarily in terms of an unfettered international gold standard. There were several reasons for this but one of them merits our attention in particular. An unfettered international gold standard will keep (normally) foreign-exchange rates within specie points and impose an ‘automatic’ link between national price levels and interest rates. The modern mind dislikes the this automatism, as much for political as for economic reasons: it dislikes the fetters this automatism clasps on government management of the economic process – dislikes gold, the naughty boy who blurts out unpleasant truths. But most of the economists of the period under survey liked it for precisely the same reasons. Though they compromised in practice as in theory and though they admitted central-bank management, the automatism – a phrase beloved by Lord Overstone [Samuel Jones Loyd, 1st Baron Overstone] – was for them, who are neither nationalists nor etatistes, a moral as well as an economic ideal.” –– Joseph Schumpeter, History of Economic Analysis (1954) Published posthumously
Charts compiled and designed by USAGOLD’s Jen Dentry with the assistance of the mints surveyed.
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Gold prices rebound as U.S. dollar weakens

NASDAQ Daily Forex/Walker England/5-25-2017, 8:55 AM EDT

“Gold prices are rebounding and trading to new weekly highs today, as the US Dollar continues to decline. Technically gold prices may now be seen as trending higher in both the short and long term. Yesterday’s bullish breakout saw gold closing back above both the 200 day MVA (simple moving average) and the 10 day EMA (exponential moving average). Currently the 10 day EMA is found at $1,235.74, and should be referenced as a value of support if prices continue to advance.”

USAGOLD comment:  Something else might be going on.  We will keep an ear to the rail.  G-7 meetings in Europe have been less than positive and that might be weighing on markets.

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News & Views – Forecasts, Commentary & Analysis on the Economy and Precious Metals

May, 2017 Edition – Weekend Sneak Peak

If you are looking for some engaging weekend reading, you might want to try the May edition of our newsletter.  We think you will find this month’s lead article revealing.  It explores gold’s historic undervaluation at current prices. (You might be surprised at just how undervalued it is in an  historical context.) We cover a lot of ground in our GoldNotes section.  Your interest is welcome. . . . . . Seems to be good reason to feature this  Ed Stein cartoon in our May issue ––

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