Gold and What Moves it.
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Gold and What Moves it.
Tracking all things that relate to and affect the price of gold.
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Jaco Schipper: Zijlstra's legacy and the 21st-century renaissance of gold | Gold Anti-Trust Action Committee

Jaco Schipper: Zijlstra's legacy and the 21st-century renaissance of gold | Gold Anti-Trust Action Committee | Gold and What Moves it. | Scoop.it

Dutch economist Jaco Schipper, a student of the work of the late Netherlands central bank president Jelle Zijlstra, who was also president of the Bank for International Settlements, writes that Zijlstra saw trade imbalances as a threat to the international monetary system and gold as crucial to putting that system back in order.

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A Historic Inversion: Gold GOFO Rates Turn Negative For The First Time Since Lehman | Zero Hedge

A Historic Inversion: Gold GOFO Rates Turn Negative For The First Time Since Lehman | Zero Hedge | Gold and What Moves it. | Scoop.it
Today, something happened that has not happened since the Lehman collapse: the 1 Month Gold Forward Offered (GOFO) rate turned negative, from 0.015% to -0.065%, for the first time in nearly 5 years, or technically since just after the Lehman...
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PRECIOUS METAL: PROTECTION OR PROFIT? - The Prospector Blog

PRECIOUS METAL: PROTECTION OR PROFIT? - The Prospector Blog | Gold and What Moves it. | Scoop.it

I’m no DOW fan, but it’s undeniable that investors have profited greatly since the days of 2008 volatility. Is it possible these same brave investors realized that stock holdings within profitable companies should not have declined in such a waterfall fashion, as they did fall 2008? Smart stock investors realized that such a bargain was a closing window of discounted opportunity.

Today’s physical silver or gold opportunity reminds me of the discounted blue-chip stock offerings of late 2008. I won’t speculate when precious metal prices will rebound but I can guarantee one thing. An ounce of physical silver, or gold, is worth far more today than what a person can buy it for, just like a 2008 blue chip stock.

Profit or protection:

If you’re protection minded, PM speaking, then the latest PM price drop means little…… maybe even nothing. Your plan is all about long-term fiscal prudence all while realizing a currency built on overpopulation (printing) cannot sustain value or buying power forever. A temporary waterfall decline within your PM plan – although disheartening – means little when compared to your plan of preservation, self-reliance, and independence. ...

Hal's insight:

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Repeating history and gold bear market

Repeating history and gold bear market | Gold and What Moves it. | Scoop.it

TORONTO(BullionStreet): History has a knack of repeating itself and that factor alone could guide the metal towartds the green light at the end of the tunnel.

 

According to latest mining industry comment by Jennings Capital Inc, gold could be close to the end of the rout though continued price weakness is possible with an implied target gold price of about $1,080 an ounce.

 

The report said : We have examined this gold bear market compared to the previous ones during the past 40 years to have an understanding of how both the commodity and the equities could respond.

 

The weighted average historical duration of previous gold bear markets was 3.2 years with a weighted average price decline of 43%.

 

This suggests to us that we could be close to the end of the rout though continued price weakness is possible with an implied target gold price of about $1,080/oz (a further 11% decline).

 

We have also examined the widening gap between the commodity and equity valuations which ...

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Paulson puts peddle to the metal despite 65% plunge in his Gold fund

Paulson puts peddle to the metal despite 65% plunge in his Gold fund | Gold and What Moves it. | Scoop.it

John Paulson, the billionaire hedge-fund manager seeking to rebound from losses tied to bullion, posted a 23 percent decline in his PFR Gold Fund last month, Bloomberg reported.

The drop brings losses in the strategy, formerly known as the Paulson Gold Fund, to 65 percent since the start of the year, the firm said.

The fund, which consists mostly of Paulson's own money, is the smallest strategy of the $19 billion money manager and the only one to post losses this year.

The firm reiterated its commitment to investing in bullion and stocks of gold producers for protection against currency debasement as central banks pump money into the global economy. Gold dropped 12 percent in June, the most since October 2008, after Federal Reserve Chairman Ben S. Bernanke said he may start reducing bond purchases that have fueled gains in financial markets globally.

“Although the timing is uncertain, if you have a long-term view we believe the funds offer the potential for outsized returns,” the firm said. ...

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Lower prices lures China,emerging market Central Banks to Gold

Lower prices lures China,emerging market Central Banks to Gold | Gold and What Moves it. | Scoop.it

LONDON (Bullion Street): Lower prices have lured emerging market Central banks to gold and this is evident from the data reported by International Monetary Fund. In April and May, 24 tonnes of gold were bought by central banks, ETF Securities Ltd said in a weekly report. Chinese consumers are also seeing lower prices as a buying opportunity. ...

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Gold climbs past $1250 in Asia

Gold climbs past $1250 in Asia | Gold and What Moves it. | Scoop.it

SINGAPORE(BullionStreet): Gold climbed past $1250 in Asian trade Tuesday, supported by a positive Chinese inflation data.

 

Spot gold was seen trading at $1250.91 an ounce at 12.00 noon Singapore time while US gold was seen at $1249.42 an ounce on the comex division of nymex.

 

Analysts said the precious yellow metal is likely to extend gains during the day on continued bargain hunting and also on a strong dollar. ...

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101M Get Food Aid from Federal Gov’t; Outnumber Full-Time Private Sector Workers | CNS News

101M Get Food Aid from Federal Gov’t; Outnumber Full-Time Private Sector Workers | CNS News | Gold and What Moves it. | Scoop.it

By Elizabeth Harrington


(CNSNews.com) – The number of Americans receiving subsidized food assistance from the federal government has risen to 101 million, representing roughly a third of the U.S. population.

 

The U.S. Department of Agriculture estimates that a total of 101,000,000 people currently participate in at least one of the 15 food programs offered by the agency, at a cost of $114 billion in fiscal year 2012.

That means the number of Americans receiving food assistance has surpassed the number of full-time private sector workers in the U.S.


- See more at: http://cnsnews.com/news/article/101m-get-food-aid-federal-gov-t-outnumber-full-time-private-sector-workers#sthash.oqHD38LI.dpuf

Hal's insight:

Excuse me? Is this how you spell recovery?

 

hat tip to www.drudgereport.com 

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The Great Gold Shakeout of 2013 | The Daily Gold

The Great Gold Shakeout of 2013 | The Daily Gold | Gold and What Moves it. | Scoop.it

Gold means lots of things to lots of people. To some, it is a store of value, to others; it is a barbarous relic from a long-ago era of archaic finance. To some, it is a day-trading product, to others; it is meant for jewelry and little else. The issue with gold is that it has lots of personalities. Those personalities are the embodiment of those that are buying and selling it on any given day. Sometimes, those personalities are in balance, sometimes one of them takes precedence. At the same time, unlike many investments, gold has no intrinsic value—no earnings, no book value, nothing to place a price upon. It is just a trading price and little more. The price is just a composite of the investing world’s mood.

 

I like to think of gold in terms of production cost, at least that lets you ground your thinking in something empirical. The problem is that in the short-term, commodities can and often do trade below the marginal cost of producing them—like gold currently does. So, in the end, gold is not tethered to any real value. It floats based on emotions and margin calls. ...

Hal's insight:

click through for the rest and all the charts.

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Deutsche Bank: No 1980 redux, gold rout mostly over

Deutsche Bank: No 1980 redux, gold rout mostly over | Gold and What Moves it. | Scoop.it
30 years ago US short term interest rates were at 20% making gold much less attractive than today.

 

by Frik Els:

 

The spot gold price made a nice move higher early Monday as traders capitalize on improved sentiment and a major bullion bank said the gold rout may have run its course.

 

In early morning trade the yellow metal was trading not far off its highs at $1,232 after gaining as much $20 or 1.65% in the first couple of hours of regular trading in New York.

 

The gold price is down 26% this year and trading near 3-year lows after dramatic falls in April saw the gold price drop $200 over a matter of days, but at least one investment bank believes the worst is over for gold bugs.

MarketWatch quotes a research note from Deutsche Bank out ...

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Notes From Underground: Is It Possible To Win BEN STEIN'S Money? (BEN Bernanke + Jeremy STEIN)

I have continuously opined that GOLD is not an INFLATIONARY BAROMETER but rather a store of value in a time when investors fear the onset of a deflationary spiral and how a central bank willREACT. The Japanese did not move to liquefy and debase so theYEN and BOJ maintained credibility. The initial fears in the world were that the U.S. Treasury and FED would not be able to right the economy through their UNCONVENTIONAL POLICIES, but for the last 18 months the fear of spiralling deflation and possible currency debasement has subsided in the U.S. Japan has entered the fray with their recent efforts at quantitative easing, though now it appears to be the Europeans’ problem, hence President Draghi’s turn at the July 4 media inquisition.

 

The movement in U.S. rates in response to the removal of “tapering” language has not only caused instability in European and emerging debt markets, but is sending the U.S. yield curve to a quick steepening. The short-end of the curve, the TWO YEAR, is held in place by continued FED rhetoric that “tapering is not tightening” and if QE ends it doesn’t mean that the FED will raise the FUNDS RATE. The problem in the massive steepening that has taken place is that it leads to higher mortgage rates, which will dampen housing demand as fewer potential buyers will pay higher home prices and higher interest rates. Some pundits are suggesting that potential buyers take out ADJUSTABLE RATE MORTGAGESbut in a new regulatory environment ARMS are going to be a much more difficult proposal. Credit standards are elevated and the ability for the big WALL STREET BANKS to package the garbage into new types of ASSET-BACKED SECURITIES (ABS) is not going to be easy to sell to an investment crowd still in pain from the previous credit crisis. ...

Hal's insight:

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15 Signs That The Quality Of Jobs In America Is Going Downhill Really Fast

15 Signs That The Quality Of Jobs In America Is Going Downhill Really Fast | Gold and What Moves it. | Scoop.it

Trying to find a job in America today can be an incredibly frustrating experience.  Most of the jobs that are available seem to pay very little, and there is intense competition for just about any job that is open.  But it wasn't always like this.  When I was in high school, I was immediately hired when I applied for a job at McDonalds because they were so desperate for workers that they would hire just about anyone that could flip a burger.  But in this economic environment, a single nationwide hiring event conducted by McDonalds resulted in a million job applications, and only a small percentage of those applicants were actually hired.  Our economy simply does not produce enough jobs for everyone anymore, and the percentage of "good jobs" continues to decline.  That means that it is getting really hard to find a job that will enable you to support a family, and a lot of people end up doing jobs that they are massively overqualified for.  But when times are tough, people are going to do what they have to do in order to survive. ...

Hal's insight:

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India's GJF to target 25,000 tons of idle Gold

India's GJF to target 25,000 tons of idle Gold | Gold and What Moves it. | Scoop.it
All India Gems & Jewellery Trade Federation said they will soon come up with a plan to utilise at least 5 percent of country's 25,000 tons of idle gold in the country.

 

NEW DELHI(BullionStreet): All India Gems & Jewellery Trade Federation said they will soon come up with a plan to utilise at least 5 percent of country's 25,000 tons of idle gold in the country.

 

GJF chairman Haresh Soni said they have listed number of ways that will help the government to curb imports.

 

Our representation includes gold deposit scheme that will encourage people to deposit gold lying with them, with the government, in lieu of some interest, for a few years. This gold then can be used for jewellery purpose by the industry and can later be given back to the source," Soni added. ...

Hal's insight:

Amazing how this government wants to get gold out of the hands of it's citizens.

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Telegraphing the Turnaround in Gold | Casey Research

Telegraphing the Turnaround in Gold | Casey Research | Gold and What Moves it. | Scoop.it
eff Clark, Senior Precious Metals Analyst

 

As of last Friday, gold has now fallen as much 35.4% (based on London PM fix prices) over 96 weeks. But if you're like us, you still recognize that the core reasons for investing in gold haven't changed. People who sold their gold recently made a shortsighted decision. Before too long precious metals will rebound—and probably in a big way.

 

But when? Does history have any clues about how long we'll have to wait for that rebound?

 

Perhaps the most constructive way to forecast a turnaround in gold is to look at how its price behaved in prior big corrections. ...

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Monetary Base Skyrocketing As Unemployment Hits 23.4%

Monetary Base Skyrocketing As Unemployment Hits 23.4% | Gold and What Moves it. | Scoop.it

With tremendous volatility continuing in global markets this summer, John Williams, of Shadowstats, warned that unemployment just hit a shocking new high of 23.4%, even as the monetary base continues to go parabolic.  Below is a key portion of this tremendous report and KWN wanted to pass it along to our global readers: 


Here is the ominous warning from John Williams of Shadowstats:  


Banking-System Stress.  With Fed monetization of U.S. Treasury debt at 90.5%, and with June monetary base annual growth soaring above 20%, the lack of meaningful movement in June M3 annual growth is suggestive of an intensifying liquidity crisis in the bank system, as discussed in the Hyperinflation Watch.

 

No Economic Recovery Here.  The June 2013 report on labor conditions, published July 5th by the Bureau of Labor Statistics (BLS) included some harsh indications of economic deterioration in the broader unemployment detail (ShadowStats measure hit a record high for the series), along with heavy seasonal-factor distortions in the headline payroll data. ...


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Trader Dan's Market Views: Gold pops higher in Asia

Trader Dan's Market Views: Gold pops higher in Asia | Gold and What Moves it. | Scoop.it

Gold jumped in overnight trading during the early Asian session when China released its version of the CPI. June CPI came in at +2.7% on the year where the market was looking for +2.5%. Apparently there was a rush to grab gold when the data hit the wire. Prior to that gold was relatively quiet with a slight bias to the upside.

As you can see on the chart, volume is miniscule however. The big test will be what the metal does when it enters European trading but more importantly, New York trading.

The weakness in the gold shares today (Monday) is generally a bearish sign when the metal and the shares go their own separate way so call me a skeptic until proven otherwise. Asia still loves gold while the West seems to despise it; until the West comes around to falling back in love with the metal, it will be up to Asian buying to do the heavy lifting in the metal. 

I have noted an overhead chart resistance zone which basically extends from last week's high at $1267 - $1269. Bears will be ...

Hal's insight:

Click through for the full anaylsis and chart by Trader Dan.

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Turk - Something Shocking Has Occurred In The Gold Market

Turk - Something Shocking Has Occurred In The Gold Market | Gold and What Moves it. | Scoop.it

James Turk tells King World News:


Gold backwardation is occurring because the big bullion dealers, hedge funds and arbitragers, do not want to take this risk.  This phenomenon highlights the difference between physical metal and all of its paper substitutes.  When backwardation in the metals occurs, it means two things:  First, people want physical metal and not paper promises to deliver metal in the future.  


Second, it means that the physical market is starting to drive the price of the metal, rather than what we have seen the past several months where paper selling drove gold and silver prices to abnormally low levels.  The bottom line, Eric, is that in a year or two when we look back at today, we will marvel at how cheap the prices of physical gold and physical silver plummeted to.”

Hal's insight:

Be sure to click through to read about his thoughts on interest rates and QE.

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The Sky Is (not) Falling: a “Little More Chicken” Tale

The Sky Is (not) Falling: a “Little More Chicken” Tale | Gold and What Moves it. | Scoop.it
Lately John Michael Greer has been popping up in the blogosphere with well-thought and well-researched insights about the Arc of Empires throughout history. He proposes that like Spengler and others have proposed, Empire rises in a certain recognizable fashion, peaks in a certain fashion, but most importantly falls in a predictable fashion.
Any cursory look at history will tell you this is true, but is likewise easily understood from systems analysis: an Empire, by definition, is the process of extracting wealth from the periphery to the core. What happens once the colonies, frontier, the developing world is already paying all possible tribute?

The only remaining expansion is to both expand the periphery by colonizing ones own citizens, and to shrink the Core to ever-fewer insiders, both of which we see now. Ultimately, the core becomes an oligarchy of a few dozen while the colonized people become everyone else in the system--a 99.9999% vs the 0.0001%, an unstable situation that predictably collapses.

Greer has two returning points with this: one is that this never leads to the end of the world, and the implied point I remarked on in my previous essay: that these things unfold in their own time over the expanse of many years. ...
Hal's insight:

Click through to read the rest. It's an interesting read.

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An Amazing CoT and BPR for Gold

An Amazing CoT and BPR for Gold | Gold and What Moves it. | Scoop.it

On the all-important flip side, The Gold Cartel added another 21,427 new longs last week through the Tuesday cutoff. Because they also added 8,995 new shorts, their net short position only declined by over 12,000 contracts. However...and here comes the amazing part...their new net short position is just 22,776 contracts, roughly 70 metric tonnes of paper gold, and their updated net short ratio is also preposterously low at 1.12:1.

 

Remember, this entire "event" from the announcement of QE∞ last fall to today, has been staged in order to give The Bullion Banks the time and the ability to cover their massive paper short position. When QE∞ was announced in September of last year, the total Cartel net short position was 737 metric tonnes of paper gold. As of last Tuesday, they are now net short just 70 metric tonnes. That's an incredible and amazing drop of over 90%. ...

Hal's insight:

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Gold Update_July 2013

Ned Naylor-Leyland's gold update for July 2013

 

In light of the deep sell-off in the Gold price, I present 3 charts to clarify what has (and hasn’t) happened. Chart 1 is a chart of Spot Gold, thesecond an illustration of what makes up the daily ‘Gold’ market, the third shows the enormous flow of physical metal from West to East in thecontext of Global mine supply. There is an ongoing clash between the forces of paper supply and physical demand – paper supply has wonthe latest round, but its objective of satisfying and slaking demand for the real metal has failed entirely. ...

Hal's insight:

Hat tip to www.tfmetals.com 

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Recovery woes: America's second-largest employer is a temp agency | WashingtonExaminer.com

Recovery woes: America's second-largest employer is a temp agency | WashingtonExaminer.com | Gold and What Moves it. | Scoop.it
Behind Wal-Mart, the second-largest employer in America is Kelly Services, a temporary work provider.
Friday's disappointing jobs report showed that part-time jobs are at an all-time high, with 28 million Americans now working part-time.
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Investment group sues US Treasury over Fannie Mae & Freddie Mac bailouts

Investment group sues US Treasury over Fannie Mae & Freddie Mac bailouts | Gold and What Moves it. | Scoop.it

Hedge fund Perry Capital LLC are suing the US Treasury in federal court, claiming the state’s move in seizing all profits from the two government-owned mortgage companies has devastated stock shares.

 

Filed in the US District Court in Washington on Sunday, the lawsuit alleges that the Treasury’s new amendment of the bailout plan, which enforces a preferred stock purchase agreement, is in violation of a 2008 conservatorship law meant to keep the company afloat with government aid. 

“This blatant overreach by the federal government to seize all of the companies’ profits at the expense of the companies and all of their private investors is unlawful and must be stopped,” the official statement claim made by Perry Capital said. ...

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China Radio: "The U.S. And Europe Have Always Suppressed The Rising Price Of Gold" | Zero Hedge

China Radio: "The U.S. And Europe Have Always Suppressed The Rising Price Of Gold" | Zero Hedge | Gold and What Moves it. | Scoop.it
"The China Radio International sponsored newspaper World News Journal (Shijie Xinwenbao)(04/28): "According to China's National Foreign Exchanges Administration China's gold reserves have recently increased.
Hal's insight:

Hat tip to www.grandich.com 

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Charles Hugh Smith: About That Supposed Correlation of the U.S. Dollar and Gold....

Charles Hugh Smith: About That Supposed Correlation of the U.S. Dollar and Gold.... | Gold and What Moves it. | Scoop.it

The supposed correlation of the U.S. dollar and gold is not visible in the 5-year charts.


One of the most widely accepted truisms in what passes for our financial media is that the dollar and gold are correlated: when the dollar weakens, gold rises, and when gold rises, the dollar declines. Nice, except this vaunted correlation isn't remotely visible in the charts. Let's have a look. Here is the 5-year chart of the DXY Dollar Index, the most widely quoted measure of the U.S. Dollar: ...
Hal's insight:

Click through for the full article and charts. A great read.

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Did Germany disrupt the global Gold market?

Did Germany disrupt the global Gold market? | Gold and What Moves it. | Scoop.it
The BRICs, whose economic power is ascendant, are seeking to establish a new currency for global trade that is owned by no single central bank or entangled in the domestic policies of no single country.

 

How remarkable is it that Germany, at the urging of their citizens and despite the objections of their central banks, has requested the return of its sovereign gold from its custodial storage in New York? And that the Feds said, no. You can’t have it, but we will be in position to return your own property in seven years time.

What was up with that? Venezuela had recently requested its gold to be returned, and that helped to push the price of gold up to its all time high, because the request had obviously been floated before it became public knowledge.

So why couldn’t Germany have the return of its own property for seven years?

Think about this. And perhaps what is happening now will become more clear. It is all a part of the credibility trap, wherein past actions of officials must be hidden in order to protect careers and ensure the orderly functioning of the status quo, even to its own eventual detriment.

Oh this is wrong? This is some weird theory? Well I admit that part of the problem is that we are left to guess what the central banks and ...

Hal's insight:

Good read. Click through.

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