HardAssetsInvestor: How would you characterize the gold market right now?
Joe Foster: I'd characterize it as it's forming a base. I think we've established the lows around $1,200 an ounce and it's in a bottoming process. We’ll spend most of the year in a range, but the likelihood is for prices to go higher, not lower.
HAI: Inflation hasn't been a notable factor for many years now. Do you see that changing any time in the not-too-distant future?
Foster: Possibly, yes. The unemployment rate is coming down. The main driver of inflation is labor and wages. As the economy continues to pick up and more people find work, there is a shortage of qualified people out there. We could see some wage inflation sometime in the next couple of years that may concern people.
HAI: Will that inflation drive gold higher?
Foster: Gold's driven by financial stress. The source of the stress doesn't matter. You could have bad levels of ...
Here's something you don't see very often: For a day and a half this week, the Japanese government's benchmark 10-year bonds attracted not a single successful private sector bid. At today's artificially-depressed yields ...
Today one of the legends in the business spoke with King World News about what the elites fear is going to crash the American economy and the global financial system. Keith Barron, who consults with major companies around the world and is responsible for one of the largest gold discoveries in the last quarter century, also discussed the massive demand for gold from China as well as what to expect from the gold market in the future.
Barron: “The flow of gold into China is massive and it hasn’t abated. If anything, it has picked up speed. If you look at the growth in Chinese gold demand over the past few years, it won’t be long before we see almost the entire annual gold production in the world going to China....
Today one of the legends in the business warned that for the first time banks are beginning to push what could be a staggering amount of reserves into the financial system. 50-year veteran Art Cashin, who is Director of Floor Operations at UBS ($650 billion under management), also warned the implications of this are “huge” because it will have a massive impact on major markets, Fed policy, inflation, and may possibly lead to hyperinflation.
By Art Cashin Director of Floor Operations at UBS
April 17 (King World News) - “On this day (+2) in 1536, there began one of those ventures that remind us cynics of the hope and promise that once was America. To hear today's citizens tell it, there's something in America that brings out a "dog eat dog", survival of the fittest attitude. When did all this happen??
Well, anyway back in 1536, America was new, pristine, an innocent wonderland. Columbus had found it just 44 years earlier. Cabot and Verrazano claimed to have seen wondrous shores teeming with lobster just a few years earlier. It would be nearly a century however until there were pilgrims, Henry Hudson, John Smith or Pocahontas.
But rumors of this new and glorious virgin land inspired curiosity - a kind of Jurassic Park of its day. And as Michael Eisner might say when folks are curious, or seek adventure and hope to see something new - there is money to be made. (Okay! Okay! Skip Euro Disney.)
So a man named Richard Hoar (or Hore) offered (for a fee) a fantastic cruise to this wondrous new land and back. He was an experienced sea-captain and also knew how to advertise. Soon, 25 well-to-do young men (and their servants) as well as a small group of the aspiring middle class signed on. Capt. Hoar rented two boats and with 120 adventurers sailed west. ...
I rather enjoyed this read. Click through for the full post and to see how the story ends.
So why does the government maintain such a transparently inaccurate and misleading metric? For three reasons.
That the official rate of inflation doesn't reflect reality is obvious to anyone paying college tuition and healthcare out of pocket. The debate over the accuracy of the official consumer price index (CPI) and personal consumption expenditures (PCE--the so-called core rate of inflation) has raged for years, with no resolution in sight.
The CPI calculates inflation based on the prices of a basket of goods and services that are adjusted by hedonics, i.e. improvements that are not reflected in the price of the goods. Housing costs are largely calculated on equivalent rent, i.e. what homeowners reckon they would pay if they were renting their house.
The CPI attempts to measure the relative weight of each component ...
Gold production in Peru, the world's sixth biggest exporter of the precious metal, will likely either plateau or dip slightly this year compared with 2013, mining companies, analysts and the government said. But the government hopes it can repeat the same level of production posted last year of 4.8 million ounces, deputy mines minister Guillermo Shinno said. "This is not going to be a year when we grow in gold production," Shinno said. Barrick Gold's Pierina mine wound down production in recent months and is in the process of closing.
With all the mining issues, it's a good thing that we have paper gold to keep that market happy ;-)
If any nation is happy about India' gold import curbs it is the UAE, where bullion traders are registering brisk sales given the restrictions on the import of the precious metal in India.
The curbs on gold in India have raised demand for gold and diamond studded gold jewellery among expatriate Indians and visitors from India to the UAE.
"The UAE’s gold trade has become the de facto beneficiary of the Indian government’s tough stance on domestic consumption. There is almost a 16% difference on a per gram basis, in buying gold ornaments in the UAE as compared to buying gold in India," said an official at a store in Dubai's gold souk. ...
I'm not surprised by this in the least. And I'm certain a portion is being smuggled back to India.
A massive dump of gold futures contracts immediately ahead of U.S. market opening is seen as responsible for much of yesterday’s gold price plunge.
Author: Lawrence Williams
Posted: Wednesday , 16 Apr 2014
LONDON (MINEWEB) -
Yesterday’s gold price plunge which saw the yellow metal fall from the $1,320s down as low as the $1,280s at one time, before making a small recovery, is seen by some as yet another instance of gold price manipulation in support of U.S. Fed policies and the large fall in the US dollar which had taken it down to below the 80 dollar index mark – considered by some as a key level.
According to U.S. website, ZeroHedge, at precisely 8:27 am eastern Standard Time, COMEX saw a massive gold futures contract sell order. “This morning, shortly before 8:27 a.m. ET, someone decided that it was the perfect time to dump thousands of gold futures contracts worth over half a billion dollars notional. This smashed gold futures down over $12 instantaneously, breaking below the 200-day moving averaged and triggering the futures exchange to halt trading in the precious metal for 10 seconds.” ...
Cyprus Foreign Minister Ioannis Kasoulides told a German newspaper Wednesday that economic sanctions against Russia by Europe would destroy the Cypriot economy, adding that every EU state should decide separately whether they want to cut ties with Moscow.
“There are very strong economic ties between Cyprus and Russia. If sanctions are really necessary, then every member state should decide for itself whether to take part. However the measures look, we must not harm ourselves,” Kasoulides told Die Welt.
Kasoulides, speaking during deliberations at a meeting of the Foreign Affairs Council of the EU in Luxemburg, said the upcoming meeting in Geneva between the US, Russia, Ukraine, and the High Representative of the EU is an important “weapon” for establishing de-escalation in Ukraine. ...
The essence of crony-capitalism is the merger of state and corporate power--the definition of fascism.
When it comes to the real world, the difference between fascism, communism and crony-capitalism is semantic. Let's start with everyone's favorite hot-word, fascism, which Italian dictator Benito Mussolini defined as "the merger of state and corporate power." In other words, the state and corporate cartels are one system.
Real-world communism, for example as practiced in the People's Republic of China, boils down to protecting a thoroughly corrupt elite and state-owned enterprises (SOEs). The state prohibits anything that threatens the profits (and bribes) of SOEs--for example, taxi-apps that enable consumers to bypass the SOE cab companies. ...
In the U.S., the March Advance Retail Sales jumped more than expected by 1.1% compared to 0.3% in February. The CPI and the core inflation, led by food and rent, rose more than anticipated by 0.2% in March.
They won't realize the geopolitical winds which are now blowing. Off in their own lala land, the average American will be focused on sports, celebrities, what the right amount of stealing (taxes) in society is, gay rights, which foreign countries "we" should bomb next, the first woman president, and so on and so forth, while their livelihoods are sacrificed in the name of the US government.
They will wake up one morning, and their prospects will be gloomier than they are now. Don't think such a thing happens? This exact thing just happened in the Ukraine. Devastation. People wake up one morning and all the sudden everything they had worked so hard for is gone. "Oh, but that's Ukraine!" you might say. "Not here in the US."
Well, when you realize that a lot of the policies now being instituted in Ukraine were supported by the US government and the International Monetary Fund, which is largely funded by the US government, then maybe, just maybe you will start to see things differently. If not, I understand. Public schools are not kind institutions to reason. If that's not reason enough just consider the growing police state. ...
Critics of price charting charge that charts only show for certain where a market has been. I completely agree. These charges are valid. Yet, understanding where market has been can provide historical context — and this historical context can be useful in anticipating the future.
Thank God for the manipulation. Could be collateral stress? We get to buy at lower prices. I just wish they manipulated the price of food, clothing and shelter lower as well. – Comment from a reader
There’s no question about it – the Fed and the Government’s taxpayer-funded Exchange Stabilization Fund have all of the markets under “lock-down” control right now. The real economic data plus the geopolitical risk becomes worse by the day. And yet, just when it looks like the stock market is going to drop off a cliff, out of nowhere the S&P 500 futures take off straight up as if launched from an anti-aircraft missile launcher. Similary, every time the precious metals start to make a serious move higher, HFT-driven mini-flash crashes start to occur repetitively during the least active periods of overnight trading and always after the Shanghai Gold Exchange closes. ...
"Today’s news and yesterday’s news, with gold declining, is very interesting. The most important reason put out by the bullion banks and the mainstream media had to do with the study released by the World Gold Council that suggested that not all of the gold that’s been imported into China has been used for central bank reserves or has gone into retail safekeeping.
“They suggested that a substantial amount of gold was imported into China to be used as security for lending transactions. And the supposition of the study, of course, is that this is somehow other than a good thing for the gold market.
I would point out that what that means is that a whole class ...
Click over for the full interview. It is the kind of news that makes you scratch your head.
Did you know that Family Dollar is closing 370 stores? When I learned of this, I was quite stunned. I knew that retailers that serve the middle class were really struggling right now, but I had no idea that things had gotten so bad for low end stores like Family Dollar. In the post-2008 era, dollar stores had generally been one of the few bright spots in ...
This is a shocker. I'm confused. I thought the economy was rebounding? :-/
Lower gold prices have caught the attention of participants in physical markets, but buyers seem tentative to participate in size for now despite recent dips below $1,300 an ounce, said Swiss bank UBS.
It always does. One of these days the paper and the physical will be unchained.
Higher gold production costs and inflation will probably be the main catalysts for gold's rise over the long term.
Despite recent weakness, gold remains significantly above the long-term (solid black) trendline. This means the long-term gold bull market is still intact.In a bull market, it is normal for prices to accelerate from the long-term trendline. You can see this in the dashed and dotted trendlines.In the rose-colored area, prices accelerated and entered a correction below the accelerated trendline. Gold stayed above the long-term trendline during the correction, leaving the long-term bull market intact.
Prices consolidated in a trading range from about $700 to $1,000 for almost two years. This is normal for commodities. ...
In many of my conversations with legendary speculator Doug Casey since the crash of 2008, Doug has talked about a coming super-bubble.
Everything Doug has studied about human nature, history, and economics-from Roman times right up to the present-has him absolutely convinced that the global economy is headed for high inflation, with a very real potential for hyperinflation in the US.
Ben Bernanke's panicked deployment of squadrons of cash-laden choppers has been emulated around the world. The Bank of International Settlements estimates that global debt markets now exceed $100 trillion. ...
Gold is being batted back and forth between two opposing forces at the moment. The negative force continues to be the slowing Chinese economy with traders fearing a slackening of demand from that key consumer. The positive is escalating tensions in the eastern part of Ukraine.
Separatists, or pro-Russian citizens, are continuing to clash with pro-Western citizens with the Ukranian military getting more involved, although there have been reports of defections over to the Russian side from some Ukranian military units.
This is supporting gold, as is the weakness in the US Dollar.
Much is being made in certain gold perma-bull websites about rising meat prices as evidence that inflation is here to stay. Such stories are meant to justify claims that gold should be moving significantly higher in anticipation of even further upward price pressures but such stories are ...