Central Banks boost gold holdings yet again
Latest figures from the IMF show that Central Banks have continued to increase their gold holdings significantly in April, after a big increase the previous month.
Author: Lawrence Williams
The latest official Central Bank gold holding figures from the IMF confirm that Central Banks around the world are continuing to buy gold - some in pretty large quantities which should be yet another stabilising factor for the gold price - and if the trend continues suggests that the CBs will buy even more this year than last - and that's only the ones which let the world know exactly what their gold reserves are!
The latest figures not only show some substantial gold buying in April, but also a big lift in gold purchases by The Philippines which actually date back to March, but were slow in being notified to the IMF.  The Phillipines' March gold purchases amounted to no less than 1.033 million ounces - 32 tonnes - of the yellow metal - the biggest volume since Mexico bought around 78 tonnes a little over a year ago - and increased tet country's gold reserves by almost 20%.



Wave of monetary accumulation will see gold continue upwards march
With the greenback merely "the best-looking horse on its way to the glue factory", the global economic imbroglio will lead to gold regaining its mojo and hitting new heights
Author: Jeffrey Nichols*
Gold's recent performance has certainly been a major disappointment to the many analysts and investors who have been anticipating another stellar year for the yellow metal.  But the year is hardly over . . . nor is gold's long-term bull market.
I believe we will see a reversal of gold's fortunes and new all-time highs, if not this year then certainly in 2013.  Moreover, the now decade-long advance in the metal's price could last another five-to-ten years given the global economic challenges that lie ahead.
For now, gold's short-term prospects remain uncertain.  So far this year, gold has traded at well beneath its all-time high of $1,924 recorded last September.  Its subsequent low near $1,520 an ounce registered in late December now, in recent days, again seems to be a vulnerable support level.  As we have previously cautioned, a fall back to $1,520 - or even lower - is certainly possible before gold resumes its long-term ascent.

Investing in Gold as World Economies Falter

By Eric J. Fry 
Are you a civilized individual or a Neanderthal? Berkshire Hathaway's Charlie Munger provides a simple litmus test... "Civilized people don't buy gold," says Munger.
There you have it. If you possess absolutely no gold, other than maybe a tooth filling, you are civilized. Congratulations!
If, however, you've stashed a few Krugerrands under your mattress, we've got some bad news for you. You are hopelessly uncivilized - a financial Neanderthal, deserving of pity from your civilized counterparts.
"I think gold is a great thing to sew into your garments if you're a Jewish family in Vienna in 1939," Munger remarked recently, "but I think civilized people don't buy gold. They invest in productive businesses."
Yes, that's right, Charlie. Civilized people invest in productive businesses...until an uncivilized government decides to steal it, or merely tax and regulate it into oblivion. Some Jews in Vienna in 1939 operated extremely productive businesses. Unfortunately, they could not stitch any of those into their garments.

Gave: “Shock and Awe” Money-Printing Ahead

5/24/2012

Look for JPMorgan & Euro Printing to Boost PMs
By Peter Cooper
The pessimism in the precious metals market just has to be at something of a high point. And yet there is an obvious point of release on the horizon. Greece runs out of cash in six weeks’ time and that will finally force the euro zone to do the necessary and print money again.
At the same time the long-standing enemy of bullion prices, JP Morgan is in serious trouble with its derivative gambles on the euro zone. Estimates of losses were originally $2 billion but we now have $5 billion suggested by rival Morgan Stanley.

Gold's fundamentals sound as politicians bumble on
While financial markets continue to crumble, G-8 leaders simply acknowledge the need for global growth and jobs, David Levenstein worries that is not enough
Author: David Levenstein
After its recent rebound, gold prices were trading slightly lower on Tuesday pressured by a firmer U.S. dollar and weaker crude oil prices. Although the price of gold still remains range bound while it consolidates, it needs to make a decisive break above $1600 an ounce to attract momentum traders.
During the last few weeks short-term traders have been shaken by gold's performance in light of the deepening crisis in the Eurozone. But, to put things into perspective, most of the selling has occurred on Comex due to a breach of some key support levels, and not due to any change in the fundamentals behind the gold price. The downward pressure on gold can be attributed to a speculative play on the part of the major bullion banks that have intervened in this market countless times. However, the price of gold needs to trade back above $1600 an ounce and a break above $1625 would indicate that the current uptrend has resumed and that this correction is now complete.

German Politicians Face Questions about Gold
By Roman Baudzus
In recent weeks pressure has been building on the German Bundesbank after the tabloid newspaper Bild started a media campaign questioning the location of Germany’s gold reserves. The country’s Federal Court of Auditors has started investigating official data on the subject, and will soon present its findings to the Bundestag's Budget Committee.
At the start of last week the Bundesbank itself commented on this investigation – reconfirming that its official gold reserves are stored at the New York Federal Reserve, the Bank of England, and the Banque de France. It has been five years since the bank’s last gold audit, and Bild’s campaign is aimed at forcing greater transparency on this issue. Given the difficult situation currently facing the euro zone, the timing of the newspaper’s campaign is perhaps not surprising.
The German state owns just under 3,400 tonnes of gold according to the Bundesbank, worth approximately €135 billion at current market value. More and more people are however questioning whether the bank’s audit processes are reliable. Germans as well as other Europeans would perhaps also be well advised to heed the implicit warning in the old Anglo-Saxon saying: “possession is nine-tenths of the law”.

Richard Russell: We Are Entering Second Half of the Bear Market

 With tremendous volatility in global markets, the Godfather of newsletter writers, Richard Russell, warned his readers that “something BIG is heading our way,” and “I wonder how much longer the decline will continue to be orderly.”  Here is what Russell had to say:  “As of today's closing, Dow down 14 out of 16 sessions!  This is one you can tell your kids about.  And still no collapse in breadth, and still no crash.  The only thing I can make out of it is that a lot of people are standing their ground.”

5/22/2012

Doug Casey on Taxes and Freedom
By Doug Casey
The always-outspoken Doug Casey addresses a broader view of taxation and its costs to both individuals and society in general in this interview with Louis James.
Louis James: We get a lot of letters from readers who know about your international lifestyle and wonder about the tax advantages they assume it confers. Is this something you care to talk about?
Doug Casey: Yes; something wicked this way comes, indeed. But first, I have to say that as much as I can understand the guy who flew his airplane into an IRS building, as we once discussed, I do not encourage anyone to break the law. That’s not for ethical reasons — far from it — but strictly on practical grounds. The Taxman can and will come for you, no matter how great or small the amount of tax he expects to extract from you. The IRS can impound your assets, take your computers, freeze your accounts, and make life just about impossible for you, while you struggle to defend yourself against their claims and keep the rest of your life going. The number of IRS horror stories is beyond counting. As the state goes deeper into insolvency, its enforcement of tax laws will necessarily become more draconian. So you absolutely don’t want to become a target.

Silver Market Update 05/22/12
by Clive Maund

The patterns forming in gold and silver are remarkably similar, and much of what has been written in the parallel Gold Market update applies equally to silver, so it will not be repeated here. The big question is "has silver finally bottomed?" – that is the question that we are going to attempt to answer in this update.
The chief difference between gold and silver is that silver is much more volatile than gold and thus serves as a vehicle to obtain more leverage on moves in the Precious Metals sector, in either direction. This is demonstrated by the silver to gold ratio chart, which we will look at shortly, which shows that when the sector is depressed, silver falls more in percentage terms than gold does.

Brian Pretti: Three Major Macro Events in June
The Fed meeting, the Greek elections and the Supreme Court decision on ObamaCare.
Brian Pretti:  Three Major Macro Events in June−More QE On The Way?
Things feel better–but watch the leading economic indicators.
From Jim Puplava and Financial Sense:
Jim welcomes back Brian Pretti this week to discuss three major macro events that could move the markets in June. The Federal Reserve could announce the next round of QE, the Greek elections could change the political landscape in Europe and the Supreme Court decision on health care legislation could impact the elections in November.

Why Sooner or Later in Europe Someone Will Have to Pay
By Dan Denning •

Let the recriminations begin! And then the show trials!
This whole idea of moving money from the public to the insiders - and maintaining the public's enthusiasm for getting ripped off - is in trouble. It's not just Facebook, either. China has apparently had enough of Europe's family squabble about who will pay the bill for a decade of spending decadence. Today's Daily Reckoning will look at the complex picture and explain why it must end in catastrophe.
But first the comedy. Sort of. Lawyers are queuing up to ask Morgan Stanley what it knew and when it knew it. Specifically, media reports suggest that Morgan Stanley, one of the underwriters of the disastrous Facebook IPO, may have shared negative earnings forecasts for Facebook with investors just hours before the IPO.

5/21/2012

People power, gold and silver - huge rebound ahead.
Leonard Melman, veteran precious metals analyst, discusses the implications of the recent European elections on the prospects for the gold and silver markets and their likely huge rebound. Gold Report interview.
Author: Zig Lambo and JT Long
TGR: It seems that economists can plan and recommend, and politicians can negotiate and maneuver, and pundits can analyze and predict all they want, yet when the people don't want to play along, it can all mean nothing. Of course, we're talking about the elections in France and Greece. What's going on?
Leonard Melman: What's going on is that the monetary authorities in Europe have decided that austerity is the only way out of the financial dilemma, which I find kind of amusing, because it is their Keynesian activities that created those policies in the first place. Their decision now is that austerity, which is cutting back government programs, is the only thing that will work. The problem is that the public doesn't want their government benefits cut back. So, the message from the French people was that Nicolas Sarkozy, with his austerity, was no longer their friend and François Hollande, with his promise to end austerity, is now the new President. In Greece it's even more dramatic. Greece has been a funny culture for about 40 years living in a dreamland, thinking that nobody has to work and nobody has to pay taxes, which is sort of their national sport.

China expected to be top gold buyer in the world by the end of 2012
The World Gold Council has just released a statement indicating that China will be the largest net buyer of old in the world through the end of 2012. The country is growing quickly and demand for gold is growing rapidly as China is about to overtake India as the world's number one buyer of gold.
In the first quarter of 2012 alone, Forbes reported that China consumed a whopping 255.2 metric tons of gold.
For investors, news like this speaks of gold prices rising in the long term because both India and China are two world economies that are expected to grow massively in the coming decade. With demand in China rising by a full 10% so far this year, and the Asian country's noted distrust of the dollar, many believe that further intakes of gold are going to create a level of scarcity that will help prices of the precious metal to rise. Those buying gold to strengthen their portfolios today would be in a good position to profit from that type of rise in prices.

Greeks Run on Banks as Euro-Confidence Wanes

By Eric J. Fry
In Pamplona, Spaniards run with the bulls. In Athens, Greeks run on the banks. Yes, folks a good, old-fashioned bank run is underway in Greece.
During the last couple of years, anxious Greeks have yanked a net €72 billion from the banking system - or nearly a third of total short-term bank deposits. And according to the scuttlebutt, withdrawals have been accelerating in recent days, as the "unthinkable" possibility that Greece might withdraw from the euro bloc has become increasingly thinkable.
So who could blame the Greeks for grabbing their euros before they turn into zeros...or, at best, drachma? In fact, given the chaotic conditions now unfolding in Europe, who could blame anyone for grabbing their euros before they turn into zeros?
Anxious Spaniards are also queuing up to withdraw their euros from the banking system. And many bond investors are behaving similarly: they are dumping Spanish government bonds and/or buying insurance against a default by the Spanish government.



Neither the Fed Nor the ECB Can Stop What's Coming
Today, we are witnessing the investment world’s slow awakening to the fact that the monetary actions taken by the world’s Central Banks have not in fact solved the issues leading up to the 2008 Crisis.
 
In point of fact, the Central Banks’ actions have exacerbated pre-existing problems  (excessive leverage) while simultaneously creating new problems (inflation).This slow awakening has taken much longer than I would have expected, but with tens of thousands of careers on the line (financial professionals) as well as tens of trillions of dollars in portfolios at risk, the vast majority of professional market participants were highly incentivized not to realize these issues.

5/21/2012

Bill Murphy of GATA and LeMetropoleCafe, Rare Sunday Commentary "CFTC may be Forced to Do Something soon about the Silver Shorts."

Sprott sees great things for gold and silver

An expectedly upbeat presentation on gold and silver in New York from Eric Sprott pointed to a large number of factors supporting his premise that gold, and silver even more so, will revert back to their rising paths.
Author: Lawrence Williams
In his keynote presentation to last week's New York Hard Assets Investment Conference, Eric Sprott, as usual as a precious metals believer, gave an upbeat presentation on the long term prospects for gold and silver.
He opened his address by pointing to a big change in the markets since he presented at the same event a year earlier when, as he pointed out, the silver price was around $49.50 "until they bombed it" and gold was shortly to see $1900 plus.  But overall he pointed to the huge sea change in the precious metals markets over the past 12 years and that the 12 month correction we are currently seeing is a temporary phenomenon and that he reckons the physical market in gold and silver is actually still in great shape.

Missouri lawmakers debate U.S. gold, silver coins use as legal tender
Missouri may be the second state, after Utah, to authorize the use of gold and silver coins or special "sound-money depositories" to pay debts to state government.
Author: Dorothy Kosich
As the Missouri General Assembly pushes toward adjournment, a bill that originally aimed at exempting gold investors from capital gains taxes has now transformed into the Missouri Sound Money Act of 2012, which would make gold and silver legal tender within the state.
The legislation would also eliminate several state taxes on gold and silver, including capital gains and sales taxes.
House Bill 1637 would allow the establishment of sound-money depositories that would allow citizens to deposit precious metals and use debit cards to pay bills out of those accounts. The depositories would be regulated by Missouri's Secretary of State.

US House Stealthily Passes Extreme Pro-Israel Legislation
Philip Giraldi May 21, 2012 3
The House bill basically provides Israel with a blank check drawn on the U.S. taxpayer to maintain its “qualitative military edge” over all of its neighbors combined.
 
 
by Philip Giraldi
 
Go to Google and type in “H.R. 4133.” You will discover that, apart from a handful of blogs and alternative news sites, not a single mainstream medium has reported the story of a congressional bill that might well have major impact on the conduct of United States foreign policy.
H.R. 4133, the United States-Israel Enhanced Security Cooperation Act of 2012, was introduced into the House of Representatives of the 112th Congress on March 5 “to express the sense of Congress regarding the United States-Israel strategic relationship, to direct the president to submit to Congress reports on United States actions to enhance this relationship and to assist in the defense of Israel, and for other purposes.” The American Israel Public Affairs Committee (AIPAC) reportedly helped draft the bill, and its co-sponsors include Republicans Eric Cantor and Ileana Ros-Lehtinen and Democrats Howard Berman and Steny Hoyer. Hoyer is the Democratic whip in the House of Representatives, where Cantor is majority leader. Ros-Lehtinen heads the Foreign Affairs Committee.

5/20/1012

THIS is Why I’m Invested in Physical SILVER
Contrary to many other investors, I did not invest in physical silver out of fear of an economic collapse or inflation or hyperinflation. I invested in silver purely based on the anticipated future supply shortage. To demonstrate my point, here is a chart on the total remaining silver years of supply based on current production rates.
As seen in the green graph chart, in the next 10 years Canada, China and Mexico would be running out of silver. This will remove 9000 tons (289 MILLION ounces) of annual supply from the market. That’s a whopping 40% decrease from current mine supply! And the chart assumes NO INCREASE IN DEMAND over the next 10 years.

Celente - The “Golden” Days Are Just Ahead & A New Cycle
Today top trends forecaster Gerald Celente discussed gold at length, as well as other important trends with King World News.  Celente is the founder of Trends Research, and the man many consider to be the top trends forecaster in the world.  Celente also discussed the difference between the current cycle and the 1970s.  Here is what Celente had to say:  “A lot of people are saying that, ‘The Gold bubble has burst,’ and I’m not one that believes that.  I’m a trends forecaster and my forecast is gold will continue to rise.  It may go down short-term, but long-term I’m bullish.  And I don’t speculate in gold, I buy gold.”

Throwing BRICS into the fire of precious metal investment demand
By Dr Jeffrey Lewis
Despite ongoing pressure from the United States for China to join its sanctions against Iran due to concerns over the Islamic country’s nuclear program, an Iranian diplomat recently revealed that new energy trades between Iran and China will be settled in China’s official currency the yuan.China has recently been promoting the yuan as an international currency to compete with the U.S. Dollar. Estimates indicate that this latest move by China will effectively remove 2.4 million barrels of oil produced by Iran that would normally be traded in petrodollars, thereby removing considerable oil based trade support from the U.S. Dollar.

BBC Interview with Nassim Taleb on JPMorgan


"It is one of the serious evils of our present system of banking that it enables one class of society, and that by no means a numerous one, by its control over the currency to act injuriously upon the interests of all the others and to exercise more than its just proportion of influence in political affairs."

Andrew Jackson, Farewell Address

Rational people keep struggling with the 'why' of all this. I think the struggle is because they start with some wrong assumptions about morally rational behaviour and motives. As Rick Santelli likes to say, traders are not moral when they are trading.I keep coming back to William K. Black's explanation for this enormous attraction to multi-trillion dollar bets at JPM"Financial institutions such as JPMorgan love to buy derivatives because they are opaque, create fictional income that leads to real bonuses and when (not if) they suffer losses so large that they would cause the bank to fail, they will be bailed out."

Facebook Banker Morgan Stanley Bought A Humongous Amount Of Stock To Try Support To Price
May 19 (Bloomberg) -- Morgan Stanley, the lead underwriter in Facebook Inc.’s initial public offering, stands to take a hit from a stock market debut that stoked disappointment among investors in the largest social network.The bank stepped in to prop up the stock from dipping below its $38 IPO price yesterday, said people with knowledge of the matter, who asked not to be identified because the purchases were private. Morgan Stanley, based in New York, was the only underwriter among Facebook’s 33 banks with the responsibility to support the shares, the people said.



5/19/2012

The Truth Gets Out Eventually"
Some look at today's FaceBook IPO flop, the ongoing market rout, and the situation in Europe with disenchantment and disappointment. We, on the other hand, view it with hope: because more than anything, the events of the past few days show that the truth is getting out - the truth that capital markets simply can not exist under the authoritarian rule of central planners, the truth that the stock market is a casino in which the best one can hope for a quick flip, and finally the truth that our entire socio-economic regime, whose existence has been predicated by borrowing from the uncreated wealth of the future, and where accumulated debt could be wiped out at the flip of a switch if things go wrong in the process obliterating the welfare of billions (of less than 1%ers), is one big lie.


The Facebook IPO: The Last Great Wall Street Party

The Facebook IPO is kind of like a graduation party - everybody comes together for one huge blowout to celebrate the end of an era before going their separate ways.  Unfortunately, most people on Wall Street do not understand how bittersweet this moment really is.  A tremendous amount of pain is ahead for Wall Street in the next few years, and we will probably never see anything like the Facebook IPO ever again. But the Facebook IPO sure has been fun to watch.  Facebook is one of the largest companies to ever go public in the United States.  According to CNN, 247 million shares of Facebook exchanged hands in the first 45 minutes of trading.  The Facebook IPO was nearly ten times larger than any other Internet IPO in history, and the amount of money being made by some people on this deal is absolutely amazing.  For example, it is being reported that Bono will make more money on the Facebook IPO than he has from being part of the band U2 for the past 30 years.  Sadly, this euphoria is not going to last for long.  The next wave of the global financial collapse is rapidly approaching, and once it strikes there will not be much for anyone on Wall Street to be smiling about at all.

Eric Sprott - Governments Frightened of Panic Liquidation Event

 
Today billionaire Eric Sprott told King World News that governments are desperately trying to avoid a “Liquidation Event.”  Sprott, who is Chairman of Sprott Asset Management, also warned the the market is liquidating, “irrespective of whether the powers that be want it or not.”  Here is what Sprott had to say about the unfolding crisis:  “Something has to be done because it’s totally out of control these days.  I mean you can’t have bank runs (like we’re seeing).  The one thing the powers that be, the central banks and the governments, have tried to do is to avoid what I call a ‘Liquidation Event.’”



5/18/2012

Paper gold & silver Ponzi exposed - Technical analysis
Anyone watching the gold and silver market understands that something is not right. An objective look at the fundamentals suggests that there seems to be no substance behind the recent downwards move.
Author: Brett Heath
There has been a constant debate over the years on what drives the price of gold and silver. Obviously we have the fundamentals that have put the metals in a bull market for the last 10 years. The powers that be have total control over money, as they set the price for capital via manipulating the interest rates. So it is not a stretch that they would be concerned with a rising gold price because gold is a threat to how the current fiat regime functions on a day-to-day basis.Without Mr. Bernanke able to step in and buy US treasury bills, where would interest rates be? How would we fund our deficits?
These are just some of the reasons why it is important for the elites to pay attention to the price of gold and silver. Knowing this, the powers that be have instructed their banking arms JPMorgan, HSBC, Goldman Sachs and the like, to create paper derivatives to help manage the price.

Fears of ’08 Credit Meltdown Impacting Markets

 
With fears building concerning another ‘08 credit meltdown, today King World News interviewed the #1 oil analyst in the world, Mike Rothman, to get his take on what is happening.  Rothman is the Founder of Cornerstone Analytics and he has been rated #1 for Independent Energy Research by Institutional Magazine since 2006.  Rothman consults directly with governments and has attended every OPEC Meeting since 1986.  Here is what Rothman had to say about the current situation:  “Essentially, with all of the concerns about the world either falling into recession or being in a recession, you still have Brent oil at triple digit levels.  That’s a testimony that oil balances are actually quite tight.  There’s a problem getting supply.”

The Physical Gold Market – From the Weak to the Strong

By Greg Canavan
We left off yesterday wondering why the market had turned on gold recently - the supposed "safe haven" metal. But we woke up this morning and saw things had turned again...gold surged 2% overnight as the US markets sank around 1.5%.
No doubt this type of price action will confound many investors...especially those who sold in a panic in the last few weeks. The recent sell-off amongst the gold stocks is up there with 2008 for severity.
In a clear example of how the emotional decisions of investors send price diverging from value, gold stocks have plummeted while the Aussie dollar gold price, which, along with production, determines revenue, is only slightly lower.
The gold price certainly does move in mysterious ways. Today our task is to try and work out why. To do so, we need to look into the mysterious world of the London gold market

Forbes: A Return to Gold and Capitalism

5/17/2012

How The U.S. Dollar Will Be Replaced
Brandon Smith

After being immersed in the world of alternative economic analysis for several years, it sometimes becomes easy to forget that most people do not track forex markets, or debt to GDP ratio, or true unemployment, or hunch over IMF white-papers highlighting subsections which expose the trappings of the globalist ideology. Sometimes, you just assume the average person knows what the heck you are talking about. This is, of course, a mistake. However, it is a mistake that is borne from the inadequacy of our age and our culture, and is not necessarily a product of weak character, either of the analyst, or the casual reader.





Gold Tells The Truth

John Maynard Keynes, Charlie Munger and Warren Buffett all said or implied that gold was a barbarous relic. But what’s the barbarous relic? The precious metal that shows prices without a veneer of manipulation, or the paper currency that smudges the true state of supply and demand through money printing, thus misleading markets and society? Charlie Munger says gold is not for civilised people, but in reality gold may be the most civilised currency of all — because it allows civilised people to purchase insurance against the risk of civilisation failing.


Why The Next Inflation Surge Is Closer Than You Might Think

Larry Edelson:  Right now, I remain bearish most commodity markets. The reason being, they have simply not fulfilled a short-term cyclical test of support. So, more downside is possible in gold (NYSEARCA:GLD), silver (NYSEARCA:SLV), oil (NYSEARCA:USO) and an assortment of other commodities.
But there’s also no doubt in my mind that another inflationary surge is right around the corner. One that may be coming even sooner than I had expected.
For one thing, nearly $4 trillion of printed money is sloshing around the global banking system. Money printed by the U.S. Federal Reserve … by the European Central Bank … by the Bank of Japan … and by the Bank of England.
That money is mainly still in commercial banks’ coffers. It was designed to bail them out. And that it did.
But because loan demand is still soft, the banks aren’t lending. They soon will, and that money — $4 trillion worth — is likely to run rampant through the global economy.
I know. The Federal Reserve and the other central banks are largely following Ben Bernanke’s lead — and they all believe that when the time comes, they can reel that excess liquidity back in, and prevent it from running rampant through the global economy. Thereby snuffing out the next inflation surge.

Fear & Panic are the Banking Cartel’s Weapons V. the Gold & Silver Bull. Patience and Logic are the Best Defense.

Currently, there is massive negativity surrounding gold and silver and in particular, gold and silver mining stocks. At times like this, when gold and silver have taken a fairly brutal hit in a condensed period of time thanks to low daily trading volumes both in PM futures and PM stock markets that make it very easy for the banking cartel to manipulate them, it can be difficult not to sell out of everything and run for the hills if one allows emotions to dictate one’s decisions (always a bad move). Especially at a time when fundamentals mean virtually nothing and speculators like JP Morgan and Goldman Sachs are constantly rigging markets and gaming the system through their High Frequency Trading (HFT) programs, it is difficult not to become emotional with your investment decisions. Thus it is important to take a step back from the here and now, and to look at the big picture to re-gain a better grasp of where asset prices will be heading in the future and to re-establish the proper perspective with which to evaluate your decisions. At various times this year, based upon global risk factors and fundamentals, when gold and silver should have been rising, both of these precious metals were falling, and sometimes dramatically. Other times, when risk factors of global banks were elevated and financial stocks should have been falling, they instead, were rising in price.

5/16/2012

Put Your Money Where Your Mouth Is
By Peter Grandich

When we last visited this price area on gold in December 2011, I challenged the loud-mouthed gold bears to wager $1 million dollars on gold hitting $2,000 before $1,000. I offered the world’s worst gold forecaster and the “Tokyo Rose” of the gold market to double that bet, but instead he/she did his/her usual “duck and cover” dribble (Jon, the public knows how bad your track record is no matter how much a few in the media make you think your past forecasts were forgotten).
Since then, an avalanche of bearish forecasters have hit the gold market (including one that comes and goes with his gold is only worth $800 or usually half the going price) and many former bulls have gone into hiding and/or are hedging their forecasts so not to look like they are ardent bulls anymore.

Why We Are Going To See Bank Runs Happening All Over Europe

Michael Snyder: The bank runs that we are watching right now in Greece (NYSEARCA:GREK) are shocking, but they are only just the beginning.  Since May 6th, nearly one billion dollars has been withdrawn from Greek banks.  For a small nation like Greece, that is an absolutely catastrophic number.  At this point, the entire Greek banking system is in danger of collapsing.  If you had money in a Greek bank, why wouldn’t you pull it out?  If Greece leaves the euro, all euros in Greek banks will likely be converted to drachmas, and the value of those drachmas will almost certainly decline dramatically.  In fact, it has been estimated that Greek citizens could see the value of their bank accounts decline by up to 50 percent if Greece leaves the euro.  So if you had money in a Greek bank, it would only make sense to withdraw it and move it to another country as quickly as possible.  And as the eurozone begins to unravel, this is a scenario that we are going to see play out in country after country.

Why Greece Can’t Afford to Stay in the Euro

Sometime in the next few weeks we're going to find out if Greece can afford to stay in the euro. We're also going to find out if Spain and Italy can afford to leave the euro. Access to credit markets is the key issue. The stigma of default will lock a country out of capital markets. If you don't have a plan to replace your currency and then devalue it, you're doomed. We'll return to this subject at the end of today's Daily Reckoning.
But first, the crisis in Greece didn't come to a head over night but it can't be far away. Rival political parties have been unable to form a government. New elections are scheduled for the second week in June. The financial has definitely become political. The people have run out of patience with unsound money and the world built on it.
All that said, the Greeks managed to make a €430 million payment to hold-out creditors last night. Nearly 97% of Greek creditors agreed to the restructuring of the country's debt in March. That wiped off over €100 billion in Greek debt and resulted in 70% losses for some of the bondholders who accepted the deal. Not all of them did.


A Greek exit's impact on gold
For David Levenstein, even though gold's long-term trend remains intact, the short-term damage so far inflicted suggests gold may trade to between $1525/oz to $1500/oz before prices rebound.
Author: David Levenstein
Unless I misunderstood the various speeches of most of the Eurozone financial leaders a few months ago, I am sure that they were absolutely emphatic that Greece would not exit from the euro. Now, it looks almost certain that Greece will exit the single currency. But, hang on a second, there are now talks that Greece should not depart from the euro and should abide by the latest austerity plans. Yes, the circus is back in town. Once again, EU finance ministers are meeting.  As these star performers continue to debate the Greek crisis in a saga that has now gone on for more than two years, the fact remains that the European monetary union in its current form is filled with problems and practically everything these politicians tell the public is a lie. Greece is doomed and according to the newspaper Imerisia citing "reliable information," the level of funds in Greece's state coffers has fallen below 1.5 billion euros ($1.9 billion). If the state doesn't receive predicted revenue for the rest of this month, it will find it difficult to pay for social services, pensions and public-sector wages, the newspaper said.

Is the resource boom over? A resounding No!
Speaking at the New York Hard Assets Investment Conference this week, respected analyst Adrian Day gave the reasons for his belief that the recent resource boom is still far from over.
Author: Lawrence Williams
Not surprisingly - given metal price performance at the time - the audience at the New York Hard Assets Investment Conference was a little depressed. With gold heading down to the low $1500s - the lowest for several months and, of course, junior mining stocks, which is the sector most of the audience would be there to hear about, having been particularly hard hit.
What the audience really wanted advice on was addressed in one of the earlier keynote presentations by Adrian Day.  Is the resource boom over? was the title of his talk and he prefaced it with an immediate No!    In particular he made some very salient points about global copper production and the copper market itself.  He pointed out that the shortest full copper price cycle in recent history was 17 years, while the current copper cycle only started in 2001 - so if this is the end of the current resource boom this would be the shortest such cycle in over 200 years by a very long margin - which he did not see as likely.


Central Banks may buy 700 tons of gold bullion in 2012: Michael Lombardi

NEW YORK(Commodity Online): The central banks of the world is expected to purchase 700 tons of gold bullion in 2012, if the current rate of buying