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Richard Russell - Gold, Silver, Stocks & Collapsing Incomes

Richard Russell - Gold, Silver, Stocks & Collapsing Incomes | Gold and What Moves it. | Scoop.it

With key global markets at or near breakout levels, and continued, enormous volatility in the gold market, today the Godfather of newsletter writers, Richard Russell, covers collapsing incomes, gold, silver, stocks, the Fed and more.  Here is what Russell had to say in a note to subscribers: “From an investment standpoint, there's one major problem with this stock market.  What's the problem?  The problem is simply that it's not a good value.  Great investment markets are characterized by being great values.  The criterion of value is the return on the investment (the single exception to this rule is gold).”


“The dividend yield on both the Dow and the S&P Composite is currently below 3%.  Classically, it is well to remember that when the dividend yield on these two averages is in the 5-6% range, they are great values.  Because the return on the investment is now so low, investors have been forced to go to other asset classes. 

 

This has included junk bonds, option buying and selling, preferred stocks, diamonds, collectibles, commodities, agricultural lands, art, and a variety of unusual items ... My own opinion of buying or trading in such exotic products can be summed up in one sentence -- “Don't do it!”  The reason I say this is because you and I are amateurs pitting our wits against professionals.  In such exchanges, the professional almost always wins.  It's as simple as that.

 

OK Russell, then what are we to do in the face of today's over-valued stock ...


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Trader Dan's Market Views: As Ukraine Heats up so does Gold

Trader Dan's Market Views: As Ukraine Heats up so does Gold | Gold and What Moves it. | Scoop.it

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 ...

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Celente: Downplaying gold to keep the Ponzi scheme going.

Celente: Downplaying gold to keep the Ponzi scheme going. | Gold and What Moves it. | Scoop.it

Gerald Celente tells King World News:

 

"So they are downplaying gold to keep the Ponzi scheme going, and to keep the equity markets from collapsing."

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Paul Craig Roberts Warns U.S. Now Close To Total Collapse

Paul Craig Roberts Warns U.S. Now Close To Total Collapse | Gold and What Moves it. | Scoop.it

Today former US Treasury official, Dr. Paul Craig Roberts, warned King World News that the United States is now close to total collapse.  Dr. Roberts also accused Goldman Sachs and the Fed of being totally corrupt as they desperately maneuver to try to prevent the collapse of the SWIFT payment system, and he also blasted Goldman Sachs for reiterating its call for $1,050 gold.  Below is what Dr. Roberts had to say in this powerful interview.


Eric King:  “Dr. Roberts, we’ve seen Goldman Sachs reiterate their call for $1,050 gold, which has facilitated the smash on gold today.  This comes on the anniversary of last year’s $200 two-day smash in gold.  But Goldman is claiming gold will decline because the U.S. economy will accelerate in the second half of this year.”

 

Dr. Roberts:  “The American economy is not going to boom because real consumer incomes have been falling, not rising.  If there is no income growth then there is no credit growth either.  So the U.S. economy is definitely not going to accelerate....


Hal's insight:

I'm at the point where I'll believe it when I see it. I know it won't last but I'm amazed at how long they've been able to draw it out.

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India Govt raises import tariff value of Gold, Silver

India Govt raises import tariff value of Gold, Silver | Gold and What Moves it. | Scoop.it
India had raised the import duty on gold and silver in stages to 10% while it announces the import tariff value on gold and silver from time to time based on global price movements and to prevent under invoicing.
Hal's insight:

LOL That's too funny. 

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Chinese gold demand may rise 20% by 2017: industry body

Chinese gold demand may rise 20% by 2017: industry body | Gold and What Moves it. | Scoop.it
London (AFP) - China's annual demand for gold could jump around 20 percent by 2017 as more of its increasingly wealthy population seek new ways to make money, the World Gold Council predicted on Tuesday.
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When will the Money Creation End?

When will the Money Creation End? | Gold and What Moves it. | Scoop.it

That’s the big question, isn’t it after all?

 

“But there’s no inflation!” say those who accept official numbers, whose fund performance requires to look as good as possible and so on. “Au contraire!” say those who actually buy their food energy and don’t get paid to affect blindness, “It’s running at 5-10-15 (pick your percentage) !”

 

What can we do with this problem? ...

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Gold is moving West to East...What is the World Trying to Tell Us?

Gold is moving West to East...What is the World Trying to Tell Us? | Gold and What Moves it. | Scoop.it

by Scott Carter:

 

Everyone knows that the sun rises in the East, moves across our skies, and sets in the West. Over the past few years, gold buying has also been rising in the East and moving in an extraordinary migration away from Western banks and out of the hands of Western investors. Central Banks in the Far East, the Middle East and Russia have been stockpiling physical gold … as the West has held onto stakes of paper ETF’s, futures contracts, and the unbacked dollar.

 

China seized its golden opportunity last year as its gold consumption increased 41%, surpassing an astonishing 1,000 tonnes for the first time ever. A rising Chinese middle class pushed demand for gold jewelry up 43% and gold bullion up 57%.Chinese consumption of gold has quadrupled in the last decade, toppling India to now take the top spot in global consumer demand.

 

India, now the second largest buyer of gold  ...

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oftwominds-Charles Hugh Smith: The Alienation of Work

oftwominds-Charles Hugh Smith: The Alienation of Work | Gold and What Moves it. | Scoop.it

The emerging economy is opening up new ways to reconnect workers to their work and the profits from their work.

One of the most striking blind spots in our collective angst over the lack of jobs is our apparent disinterest in the nature of work and how work creates value. This disinterest is reflected in a number of conventional assumptions.

One is the constant shedding of tears over the loss of mind-numbing manufacturing jobs. I doubt a single one of the innumerable pundits decrying the loss of "good manufacturing jobs" spent even one shift in an actual assembly line. There is a reason Henry Ford had to pay the then-astronomical salary of $5 per day to his assembly-line workers: the work was so physically demanding and boring that workers quit after a single shift. The only incentive that would keep people doing such hellish work day in, day out, was a big paycheck. ...

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#BRICS countries to set up their own #IMF :: Jim Sinclair's Mineset

#BRICS countries to set up their own #IMF :: Jim Sinclair's Mineset | Gold and What Moves it. | Scoop.it

Very soon, the IMF will cease to be the world’s only organization capable of rendering international financial assistance. The BRICS countries are setting up alternative institutions, including a currency reserve pool and a development bank.


The BRICS countries (Brazil, Russia, India, China and South Africa) have made significant progress in setting up structures that would serve as an alternative to the International Monetary Fund and the World Bank, which are dominated by the U.S. and the EU. A currency reserve pool, as a replacement for the IMF, and a BRICS development bank, as a replacement for the World Bank, will begin operating as soon as in 2015, Russian Ambassador at Large Vadim Lukov has said. ...

Hal's insight:

Isn't that intriguing? LOL

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Today’s Gold Price Take-down Operation Has The Smell Of Desperation | Investment Research Dynamics

Today’s Gold Price Take-down Operation Has The Smell Of Desperation | Investment Research Dynamics | Gold and What Moves it. | Scoop.it

I had a feeling that gold and silver were being put on the “down” elevator by the bullion banks when I checked prices late in the evening  last night and saw that gold had been hit for about $8 right at the open of trading in Australia.  A quick drive-by hit when Australia opens has become almost as common an occurrence as the near-daily price take-down at the opening of the Comex floor trading in New York.

Then Bloomberg, Reuters and the Wall Street Journal ...

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3 Reasons to Consider Buying #Gold on Recent Weakness

3 Reasons to Consider Buying #Gold on Recent Weakness | Gold and What Moves it. | Scoop.it
A number of factors both in the U.S. and abroad are making gold look like a sound investment.
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Weekly SGE Withdrawals Dropping, YTD 585 MT | In Gold We Trust

Weekly SGE Withdrawals Dropping, YTD 585 MT | In Gold We Trust | Gold and What Moves it. | Scoop.it

SGE withdrawals have been in a down trend for five weeks. In these weeks withdrawals have been lower than the year to date weekly average. This is not surprisingly after an unprecedented start of 2014. During four of the first seven weeks of this year SGE withdrawals, which equals Chinese demand, transcended global mining production.

 

SGE withdrawals are still 23 % up compared to the same period last year. This will most certainly change in the period after April 15, which was the date in 2013 the gold price tumbled more than $100 and Chinese demand for physical gold exploded. The result was that in week 16 (April 15 – 10, 2013) 65 metric tonneswere withdrawn from the SGE vaults and in week 17 (April 22 - 26, 2013) 117 metric tonnes were withdrawn. The following screen shot is from the SGE report of week 17 2013, the second number from the left (blue – 本周交割量) is weekly gold withdrawn from the vaults in Kg. ...

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Dovish Fed and Stock Valuations Help Gold

Dovish Fed and Stock Valuations Help Gold | Gold and What Moves it. | Scoop.it

The U.S. Comex gold futures jumped 1.12% to $1,320.50 on Thursday after falling 0.24% the day before. Week-to-date, the gold futures have risen 1.30% while the S&P 500 Index and the Euro Stoxx 50 Index have plunged 1.67% and 2.29% respectively. The Dollar Index has also tumbled for five consecutive days by 1.36% to 79.383 on Thursday while the U.S. ten-year government bond yield has rallied 7bp this week to a low of 2.6474%, back to the level at the end of February. ...

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oftwominds-Charles Hugh Smith: What's the Difference Between Fascism, Communism and Crony-Capitalism? Nothing

oftwominds-Charles Hugh Smith: What's the Difference Between Fascism, Communism and Crony-Capitalism? Nothing | Gold and What Moves it. | Scoop.it

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. ...

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US, China data leads the Gold sell-off: Sharps Pixley

US, China data leads the Gold sell-off: Sharps Pixley | Gold and What Moves it. | Scoop.it
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.
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SGE Withdrawals Equal Chinese Gold Demand, Part 3 | In Gold We Trust

SGE Withdrawals Equal Chinese Gold Demand, Part 3 | In Gold We Trust | Gold and What Moves it. | Scoop.it
Another in-depth analysis on the Chinese gold market. SGE withdrawals at the heart.

 

On April 4, 2014 Alasdair Macleod published an extensive analysis on the Chinese gold market. I felt obligated to respond to it by sharing my point of view and explain where I disagree with his analysis. I think his estimates are largely overstated because he double counts certain demand categories. He states Chinese gold demand in 2013 was 4843 metric tonnes, according to me it was 2197 metric tonnes (my estimate excludes some hidden demand and PBOC purchases on which I have no hard numbers). Setting out our differences was incidentally a good occasion for me to write another in-depth analysis on the Chinese gold market. ...

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Year to the day of $200 shocker, another strange gold price plunge

Year to the day of $200 shocker, another strange gold price plunge | Gold and What Moves it. | Scoop.it
15 April last year the price of gold plunged $130 in a single session and over $200 in just two days. Today, another inexplicable gold price flash crash.
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A must read.

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The Global Banking Game Is Rigged, and the FDIC Is Suing

The Global Banking Game Is Rigged, and the FDIC Is Suing | Gold and What Moves it. | Scoop.it

Taxpayers are paying billions of dollars for a swindle pulled off by the world’s biggest banks, using a form of derivative called interest-rate swaps; and the Federal Deposit Insurance Corporation has now joined a chorus of litigants suing over it. According to an SEIU report:

Derivatives . . . have turned into a windfall for banks and a nightmare for taxpayers. . . . While banks are still collecting fixed rates of 3 to 6 percent, they are now regularly paying public entities as little as a tenth of one percent on the outstanding bonds, with rates expected to remain low in the future. Over the life of the deals, banks are now projected to collect billions more than they pay state and local governments – an outcome which amounts to a second bailout for banks, this one paid directly out of state and local budgets.

It is not just that local governments, universities and pension funds made a bad bet on these swaps. The game itself was rigged, as explained below. The FDIC is now suing in civil court for damages and punitive damages, a lead that other injured local governments and agencies would be well-advised to follow. But they need to hurry, because time on the statute of limitations is running out.

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There are shenanigans in #silver’s futures price for the Comex front month - Turk

There are shenanigans in #silver’s futures price for the Comex front month - Turk | Gold and What Moves it. | Scoop.it

James Turk tells King World News:


There are shenanigans in silver’s futures price for the Comex front month.  The price looks totally fictitious when compared to the spot price of physical metal, but most individual traders of Comex futures are unaware of what is happening in the spot market.  The reason for this is because relatively little physical metal actually trades in New York.  Consequently most futures traders are unaware of the real relationship between spot, where physical is traded, and front-month futures, which of course is the paper market. 

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Richard Russell - The Cheapest Thing On The Planet Is Silver

Richard Russell - The Cheapest Thing On The Planet Is Silver | Gold and What Moves it. | Scoop.it

With continued turmoil and uncertainty in global markets, today KWN is publishing another important piece that was written by a 60-year market veteran.  The Godfather of newsletter writers, Richard Russell, says that he is buying physical silver because it’s “dirt cheap.” Russell also warned that the gold/silver ratio may plunge from 66/1 down to 16/1.  This means the price of silver would more than triple the upside surge he expects for gold.


Russell: “Big debt is deflationary because it takes a lot of needed cash to carry big debt.  The US has doubled its total debt over the last seven years, and this in the face of almost zero interest rates.  The US is now borrowing just to pay the interest on its debt.  We're compounding ourselves into national bankruptcy.

 

Make no mistake about it -- what we're now experiencing is not a gathering stock market correction.  This is the resumption and continuation of the primary bear market that the Fed interrupted at the 2009 low.  Once a primary trend gets underway, it will always carry to conclusion.  Primary bear markets ...


Hal's insight:

Click through for the rest. The only caveat I would add and not to disrespect Mr. Russell (frankly, he might agree), is that Silver isn't the cheapest thing on the planet. Given the governments around the globe and other things going on, I would hazard to say the cheapest thing is life. Silver probably comes in at a close second ;-)

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Gold & Silver Smashed As Incredible Events Unfold In Europe

Gold & Silver Smashed As Incredible Events Unfold In Europe | Gold and What Moves it. | Scoop.it

On the heels of continued uncertainty around the globe, today an acclaimed money manager spoke with King World News about the gold and silver smash, China’s continued massive accumulation of gold, and the incredible events unfolding in Europe.  Below is what Stephen Leeb had to say in this fascinating interview.


Leeb: “Eric, overnight there was some data that was disappointing from China.  Gold and silver have been hit, but strangely enough, oil has been firm.  The key thing the markets are failing to realize is that the Chinese are getting the job done.  They are not going to slow their economy to the point where they have high unemployment and riots in the streets....

Hal's insight:

You should click through for the full interview.

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Jesse's Café Américain: Why Gold? 85% of Pension Funds Will Go Bust in 30 Years

Jesse's Café Américain: Why Gold? 85% of Pension Funds Will Go Bust in 30 Years | Gold and What Moves it. | Scoop.it

I have not seen the scenarios run by Bridgewater Associates, but I do have respect for their name and their work.  I would like to know their assumptions.

In an inflation, stocks may do quite well, as their inflated valuations keep pace with inflation. Bonds are likely to get obliterated. In a stagflation not so much.  The Fed and the Treasury would like a modest inflation to provide a controllable dilution of debts without opening the door to a debt jubilee for the hoi polloi.  The Fed serves the Banks, and therefore the creditor class.  But a parasite must also preserve the relationship with their hosts.

The system is broken and the oligarchs do not wish to fix it, because they like things just the way that they are.    They have bought the politicians and are running the regulators.  What could go wrong? ...

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6 Facts About China's Love Affair With Gold

6 Facts About China's Love Affair With Gold | Gold and What Moves it. | Scoop.it
Consumer sentiment toward gold is unwavering – although 40% of jewellery
consumption relates to weddings, the appetite for gold in China goes beyond occasions and gift giving. 80% of consumers surveyed for this report planned to maintain or increase their spending on 24-carat gold jewellery over the next 12 months believing that gold will hold its long-term value and because they expect to have a higher level of disposable income.
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Peru Gold output drops 3.14% to 11097 kg in Feb

Peru Gold output drops 3.14% to 11097 kg in Feb | Gold and What Moves it. | Scoop.it
The country produced 19442 kg of silver in February, declined by 7.14% from 20938 kg in February 2013.
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The Gold Market's Big First Quarter Surprise

The Gold Market's Big First Quarter Surprise | Gold and What Moves it. | Scoop.it
While western investors remain cool toward gold in 2014, the long-term trends remain solid. Today, Frank Holmes returns from the Asia Mining Club meeting in Hong Kong to give an inside look at China's ongoing "Love Trad" in gold, as well as Fed Chairman Janet Yellen's most likely policy change in the year ahead. Read on...
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