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Category Archives: Barack Obama

Hey Buddy Got a Jack I can Use? – Fixaflat 2

23 Thursday Apr 2009

Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, agricultural commodities, ANV, Austrian school, AUY, Bailout News, banking crisis, banking crisis banks bear market bull central deflation depression economic trends economy financial futures gold inflation crash Markets precious metals price protection recession safety silver plati, banks, Barack Obama, bear market, Bear Trap, bilderbergers, Bollinger Bands Saudi Arabia, bonds, Brian Tang, bull market, capitalism, CDE, CEF, central banks, China, Comex, commodities, Contrarian, Copper, Council on Foreign Relations, crash, Currencies, currency, Currency and Currencies, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, Dow Industrials, economic, Economic Recovery, economic trends, economy, EGO, Fed Fund Rate, Federal Deficit, federal reserve, Finance, financial, follow the money, follow the news, Forex, FRG, Fundamental Analysis, futures, futures markets, G-20, gata, GDX, GG, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, GTU, hard assets, heating oil, HL, How To Invest, How To Make Money, hyper-inflation, IAU, IMF, India, inflation, investments, Jeffrey Nichols, Jim Rogers, John Embry, Jschulmansr, Keith Fitz-Gerald, Latest News, majors, Make Money Investing, Marc Faber, Market Bubble, market crash, Markets, Michael Zielinski, mid-tier, mining companies, mining stocks, monetization, Moving Averages, NAK, NASDQ, New World Order, NGC, NWO, NXG, oil, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, Short Bonds, silver, silver miners, Silver Price Manipulation, SLW, small caps, socialism, sovereign, spot, spot price, stagflation, Stimulus, stock market, Stocks, SWC, Technical Analysis, The Fed, TIPS, Today, U.S., U.S. Dollar, volatility, warrants, XAU

≈ Comments Off on Hey Buddy Got a Jack I can Use? – Fixaflat 2

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ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, bonds, Brian Tang, bull market, CDE, CEF, central banks, China, Comex, commodities, Copper, crash, Currencies, currency, Currency and Currencies, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, GTU, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, John Embry, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NAK, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, SWC, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

Hey Buddy, got a spare jack I can use? The fixaflat turned out to be nothing but hot air and evaporated! So now I need a jack to change the tire so I can get this economy back on the road.

Some very interesting conspiracy theories coming out about Goldman Sachs and Paulson, which leads one to question why did the AIG exec committ suicide? There have been stories on the net that he really was murdered even!

My question is what did he know about Freddy Mac’s books? How much of our taxpayer money was diverted elsewhere? Who are the people whose pockets got lined? Could this scandal be pointing back to Mr. Dodd and Mr. Frank? Mr. Cuomo here is something else you need to be investigating (if you’re not already). 

We are now hearing about Bank of America being forced into buying Merrill Lynch! The rats are Ratting! I will say it again the other shoe is getting ready to drop. They are busy juggling it like a seaming hot potato, but it will drop.

Well the Dow managed to eke out a little gain in spite of more bad news for the economy. For me, it was a great opportunity to buy more (SKF) at $58.89 and I decided to also buy some (DXD) at $56.23.

The DOW may make another try at 8000 but it will fail and (DXD) will do quite nicely thankyou.

For (SKF) I’m looking at a gap that needs to be filled around the $90 mark so that is my first target for now. 

For Gold it broke $900 and closed above that. Next target $928.00 then $950, then $980. If all of those are successfully broken (which I think they will), then look for new all time highs!

That’s it for now- Have a Great Evening! – Good Investing! – jschulmansr

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 ===================================================

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                                         – Trend Analysis Revealed –

 

Substantial moves like the ones that we have recently witnessed present opportunities to succeed or fail in the markets. Traders who stayed on the correct side of the trend were rewarded substantially.

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– Have we seen the Indexes bottom or top?
– Is a reversal in the near future?
– Is it too late to go short?

Stay on the correct side of the market. Let our Trade Triangle technology work for you. It’s free, It’s informative, It’s on the money.

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Bespoke’s Commodity Snapshot – Seeking Alpha

Source: Bespoke Investment Group

Below are our trading range charts for ten major commodities. The green shading represents 2 standard deviations above and below the commodity’s 50-day moving average. When the price moves above or below this green shading, the commodity is in extreme overbought or oversold territory.
As shown, after reaching overbought territory a few weeks ago, oil has pulled back to just above the middle of its trading range. Natural gas, on the other hand, can’t get out of the downtrend that it has been in since last June. After trending higher since last October, gold and silver have recently moved to the bottom of their trading ranges, but they bounced nicely off of oversold territory a couple days ago. Platinum has held up better than gold and silver and is closer to the top of its trading range than the bottom. Copper continues to trend higher, along with orange juice, while corn, wheat, and coffee are in a sideways trading pattern.

Oilnatgas423

Goldsilv423

Platcopp423

Cornwheat423

Ojcof423

 

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Exposed! Five Myths of the Gold Market and find out:

·        Who’s been driving this record bull-run in gold?

·        What Happens When Inflation Kicks In?

·        Why most investors are WRONG about gold…

·        When and How to buy gold — at low cost with no hassle!

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Even Jack Bauer couldn’t stop ‘The Goldman Conspiracy’

By: Paul Farrell of MarketWatch.com

 

ARROYO GRANDE, Calif. (MarketWatch) — Two mind-numbing fast-paced dramas. Two parallel worlds. One real, one fiction, both deadly. Jack Bauer, mythic hero of “24.” Dying from a deadly bio-pathogen leaked from weapons developed by Starkwood, a rogue mercenary army attacking the presidency, hell-bent on taking over America.

 

The other drama in play: “Hank the Hammer” Paulson, iconic Wall Street hero, a Trojan Horse placed inside Washington by Goldman Sachs as Treasury Secretary in control of America’s $15 trillion economy. Goldman, a modern dynasty with vast financial powers much like those once used by the de’ Medici, Rothschilds and Morgans to control nations.
Both dramas play high-stakes games with financial WMDs that have lethal consequences. Jack compresses thrills, kills and chills into 24 hours. Hank, Goldman and their army of Wall Street mercenaries move with equally blinding speed, heart-pounding action.
Drama? You bet.
Six short months ago Hank led an assault on Congress. The scene parallels one in “24:” Sangala War Lord Juma’s brazen attack inside the White House. But no AK-47s necessary.
The Hammer assaulted Congress with just a two-and-a-half page memo in hand. Like a crack special-ops warrior, he took down the enemy, demanding $750 billion, absolute control, total secrecy, no accountability and emergency powers to act immediately … warning that inaction was not an option, that collapse of America’s banking system was imminent, would bring down the global monetary system, pushing world’s economies into a “Great Depression II.”
Congress surrendered.
Here’s the whole plot:
Scene 1. American government is now run by the ‘Goldman Conspiracy’
Oh, you really think just I’m plotting a television series? Or just paranoid, exaggerating this power grab? You better read “The Usual Suspects,” Matthew Malone’s brilliant article in Portfolio magazine: He “exposed” the “Goldman Sachs ‘conspiracy’ to take over the U.S. financial system.” Read it in this context: America’s financial sector has exploded from 19% of corporate profits in 1986 to 41% today, becoming a magnet for every wannabe billionaire.
They know why Wall Street must control Washington.
Malone focuses on the incestuous “conspiracy” of Goldman alumni in Treasury, Bank of America, Merrill Lynch, AIG, Citigroup, Washington lobbyists and politicians.
Scene 2. Huge conflicts motivating Wall Street’s ‘Trojan Horse’
And just in case you think any emphasis on The Hammer’s conflict of interest was invented purely to increase drama, please remember that he worked at Goldman for three decades after serving under Nixon. He got $38 million his last year as CEO in 2006 before becoming Treasury Secretary.
Then during the market meltdown six months ago the $700 million personal fortune he built at Goldman was threatened by Goldman’s huge $20 billion derivatives exposure at AIG: Suddenly his responsibilities at Treasury merged with a strong self-interest in protecting his personal fortune. AIG was “saved.”
Scene 3. Wall Street’s ‘quiet coup’ also runs world’s banking system
There’s another equally disturbing expose in “The Quiet Coup,” Simon Johnson’s great article in Atlantic magazine. A former chief economist at the International Monetary Fund, Johnson also warns that America’s “financial industry has effectively captured our government” and is “blocking essential reform.”
Worse, he says that unless we break Wall Street’s stranglehold (unlikely in the new Washington) we will be unable “to prevent a true depression,” warning that “we’re running out of time,” echoing many of our predictions of the “Great Depression II” coming soon. See previous Paul B. Farrell.
Scene 4. Wall Street used the meltdown to take over America’s government
Matt Taibbi, author of “The Great Derangement,” captured this drama in a Rolling Stone piece, “The Big Takeover, how Wall Street insiders are using the bailout to stage a revolution.” A must-read:
“As complex as all the finances are, the politics aren’t hard to follow. By creating a crisis that can only be solved by those fluent in a language too complex for ordinary people to understand, the Wall Street crowd has turned the vast majority of Americans into non-participants in their own political future. … in the age of CDS and CBO, most of us are financial illiterates.”
Wall Street “used the crisis to effect a historic, revolutionary change in our political system — transforming a democracy into a two-tiered state, one with plugged-in financial bureaucrats above and clueless customers below.”
Scene 5. How Obama is keeping alive Bush’s ‘disaster capitalism’
Back in 2007 at the start of the meltdown, Hank was misleading us in Fortune: “This is far and away the strongest global economy I’ve seen in my business lifetime.” In the real world, Naomi Klein, author of “The Shock Doctrine: Rise of Disaster Capitalism,” was warning us that “during boom times it’s profitable to preach laissez faire, because an absentee government allows speculative bubbles.”
But “when those bubbles burst, the ideology becomes a hindrance and goes dormant while big government rides to the rescue.” Then, free-market “ideology will come roaring back when the bailouts are done.
The massive debts the public is accumulating to bail out the speculators will then become part of a global budget crisis.” TARP paybacks: Obama has a new “disaster capitalism.”
Scene 6. Wall Street’s CEOs rule like dictators in a banana republic
Seriously, here’s how bad Taibbi sees it: “Paulson and his cronies turned the federal government into one gigantic half-opaque holding company, one whose balance sheet includes the world’s most appallingly large and risky hedge fund, a controlling interest in a dying insurance giant, huge investments in a group of teetering megabanks, and shares here and there in various auto-finance companies, student loans, and other failing business.”
And let’s include $5.5 trillion in Fannie Mae and Freddie Mac. Wall Street’s greed and stupidity resembles the self-destructive reigns of banana republic dictators.
Scene 7. Wall Street makes an un-American bet on ‘disaster capitalism’
Today as you ponder buying some Goldman stock, remember, you’re really betting that “disaster capitalism” is back, strong, tightening its stranglehold on Washington and on the American taxpayers, who will guarantee all Wall Street’s future failures. Yes, this is un-American, but so what?
The “Goldman Conspiracy” is still probably a good short-term buy … if you’re interested in betting on America’s new “democracy of capitalists, by capitalists, and for capitalists,” with “The Conspiracy” leading the joint chiefs of this new mercenary army … and it only took six short months for their “Quiet Coup!”
Scene 8. Banks recycle TARP money, pump earnings, cheat America
Here’s how it worked: The Hammer conned a clueless Congress, then shelled out $350 billion of our taxpayer money (Helicopter Ben Bernanke helped by upping the ante with a couple trillion side-bet), buying toxic debt to save his ol’ Wall Street buddies. They stopped lending and used the dough to doctor their balance sheets.
So no surprise that Goldman, Wells Fargo and J.P. Morgan Chase are now reporting “blockbuster” first-quarter earnings, says the New York Times, while just months ago “many of the nation’s biggest banks were on life support.”
Get it? They screwed taxpayers and borrowers so they can repay TARP with (you guessed it) our recycled TARP money. Now it’s back to business-as-usual, with no restrictions on CEO pay and bonuses … no thank-yous … no admissions of guilt … while some even arrogantly deny that they ever needed TARP money.
Scene 9. Wall Street’s already set the stage for new disaster
Right after the election in November, at the peak of the banking crisis, when Hank, Goldman and the Wall Street mercenary armies were divvying up the $350 billion TARP money, we detailed 30 reasons for the “Great Depression II” likely coming around 2011.
We quoted John Whitehead, former Goldman Sachs chairman, former chairman of the New York Fed, former Reagan deputy secretary of state. He warned America’s problems will take years, burn trillions, result in massive deficits:
“This is a road to disaster,” he said. “I’ve always been a positive person and optimistic, but I don’t see a solution here.” He did see a depression at the end of that road, one you can call the “Great Depression II.”
Scene 10. Obama turned ‘The Goldman Conspiracy’ into a superpower
Do you see the parallels: Jack and Starkwood, Hank and Goldman? Jack’s a great mythic hero. We need to believe a hero will defend the little guy, stand between us and total annihilation. But Jack Bauer’s “dead.” Yes, dead. Jack’s not real. Never was “alive.” Jack’s a fiction, a figment of Main Street America’s vivid imagination, the symbol of “hope” for a populist revolution.
Hope that Jack, Barack or some other new hero will emerge, take power back from Wall Street and return it to the people.
Unfortunately that won’t happen, folks. Yes, on TV Jack will come back from near-death, again. But in real life, Hank, Goldman and Wall Street’s mercenaries are winning the war.
Read and weep Portfolio’s chilling finale: “Obama’s victory and Geithner’s appointment are the completion of Goldman’s meticulously crafted plan to become a superpower. The firm now has the clout to impose its will on the financial markets, and the world.”
GOP or Dems? Conservatives or liberals? It doesn’t matter. We’ll all controlled by “The Conspiracy.” So why not surrender, let them have the power? The truth is, through their lobbyists and surrogates in Washington, they already rule America. Surrender is a mere formality.
Accept reality. Hold them accountable later. After the next crisis.
After the next meltdown of disaster capitalism — if there’s anything left after the “Great Depression II” sweeps like a pandemic across the planet, consuming all economies, for a long time. But for now, Goldman and other banks may well be short-term buys. Just be ready to dump them in the near future … a scenario that will be here sooner than you think. End of Story

===================================================

Claim a gram of FREE GOLD today, plus a special 18-page PDF report;

Exposed! Five Myths of the Gold Market and find out:

·        Who’s been driving this record bull-run in gold?

·        What Happens When Inflation Kicks In?

·        Why most investors are WRONG about gold…

·        When and How to buy gold — at low cost with no hassle!

Get this in-depth report now, plus a gram of free gold, at BullionVault

====================================================

Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

 

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The Swan Dive- Next For Stocks?

14 Tuesday Apr 2009

Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, agricultural commodities, ANV, Austrian school, AUY, Bailout News, banking crisis, banks, Barack Obama, bear market, Bear Trap, bilderbergers, Bollinger Bands, Bollinger Bands Saudi Arabia, bonds, Brian Tang, bull market, CDE, CEF, central banks, China, Comex, commodities, Contrarian, Copper, crash, Credit Default, Currencies, currency, Currency and Currencies, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, Dow Industrials, economic, Economic Recovery, economic trends, economy, EGO, Fed Fund Rate, Federal Deficit, federal reserve, Finance, financial, follow the money, follow the news, Forex, FRG, Fundamental Analysis, futures, futures markets, G-20, gata, GDX, GG, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, GTU, hard assets, heating oil, HL, How To Invest, How To Make Money, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, John Embry, Jschulmansr, Junior Gold Miners, Keith Fitz-Gerald, Latest News, majors, Make Money Investing, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, mining stocks, monetization, Moving Averages, NAK, natural gas, NGC, NXG, oil, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, S&P 500, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, Stimulus, stock market, Stocks, SWC, TARP, Technical Analysis, The Fed, Tier 1, Tier 2, Tier 3, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

≈ Comments Off on The Swan Dive- Next For Stocks?

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ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, bonds, Brian Tang, bull market, CDE, CEF, central banks, China, Comex, commodities, Copper, crash, Currencies, currency, Currency and Currencies, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, GTU, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, John Embry, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NAK, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, SWC, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

Well Mr. Obama said the same old, same old today and didn’t help the market at all… ANY of them! Mr. Obama what do you have against the market? I mean like your whole cabinet are all Good Ole Wall Street Boys!?! The Dow failed to maintain above 8000 today and that is a very bad sign or good depending which side of market you are on. It appears now the the intermediate wave (Elliott) is finished and stocks have climbed to the top of the diving platform. 1st attemp at a swan dive- difficulty easy. So wil it be a perfect 10 or a belly flop? Either Way the Dow is going down! My first target 7200-7500 and then a test of the 6500 level lows, (Called The “Bottom” recently). Gold and Precious Metals continue to consolidate getting ready to launch for a new test of $920, then $980, then the all time high. I think the news is going to be that bad and that dramatic. The Middle East is about to explode, N. Korea just threw out the inspectors, even the pirates are snubbing their noses at you Mr. Obama. So now the question is are you a man or a mouse? Squeak up! Copper is quietly having a nice rally, China is buying up all of our soybeans, and oil is getting ready to explode to the upside. Keep accumulating Gold and Precious Metals in any form, buy producers with production, you should jump into (DGP) with a little risk money too! In currencies my pick is the Aussie dollar, accumulate on dips because as Gold goes so will the Aussie Dollar. Good Investing! – jschulmansr

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===================================================
Claim a gram of FREE GOLD today, plus a special 18-page PDF report;
Exposed! Five Myths of the Gold Market and find out:

·        Who’s been driving this record bull-run in gold?

·        What Happens When Inflation Kicks In?

·        Why most investors are WRONG about gold…

·        When and How to buy gold — at low cost with no hassle!

Get this in-depth report now, plus a gram of free gold, at BullionVault

 

 

 

===================================================

My Note: I use these tools and they are great and they work! – jschulmansr

Subject: Two trending markets revisited and analyzed for you

 

Last week I watched a video analysis of the S&P and Crude Oil markets. The technical analysis was right on at the time, but those markets have changed quite a bit in the last few days. The S&P had a huge rally and Crude seemed to steady out, so what’s the new analysis? Glad you asked!

Below are two free videos, one on Crude Oil and one on the S&P, that gives us an indepth technical look into these markets. Again the videos are free and very informatitive. Just Click on the Links Below…

          S&P Video Analysis:                                                    Crude Oil Projections:

Here’s your chance to analyze that stock you have been thinking about adding to your portfolio. Just enter the ticker of any company, name of a commodity, or forex pair and get your complimentary technical analysis. It cost you nothing and and no payment info will ever be requested.

Click Here To Enter Your Symbol/s

My Note: I use these tools and they are great and they work! – jschulmansr

 

 

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Pros Say: Sharp Market Pullback This Week – CNBC

Source: CNBC.com

Encouraging numbers from an investment banking giant dominated discussion among the pros, who tied them to massive government stimulus efforts — and doubted they would carry ahead to economic numbers, or even to results from other investment banks. 

Financials Show Surprising Strength; Consumers Still Look Weak

Scott Brown of Raymond James said there has been a real change in the attitudes and behavior of consumers, with fear now dominant. That is likely to be reflected in retail data this week, and there’s no likelihood that consumer spending will rebound any time soon.  (click to watch the video).

Stocks ended near their session lows Tuesday after a report showed retail sales unexpectedly dropped in March and as worries about banks simmered ahead of some key earnings.

The Dow Jones Industrial Average tumbled 137.63, or 1.7 percent, to close at 7,920.18. The S&P 500 lost 2 percent, while the Nasdaq skidded 1.7 percent.

 

Retail sales tumbled 1.1 percent

last month, a big disappointment as economists polled by Reuters had expected a 0.3-percent increase. Excluding the volatile auto component, sales fell 0.9 percent. The two prior months were revised upward, offering some consolation, but the unexpected sharp drop rattled the market.

“The inescapable fact is that the U.S. consumer is faced with daunting fundamentals: Wage and salary income growth has evaporated, credit is very tight, home prices continue to decline … [which] makes it very likely that the U.S. consumer will remain a drag on economic activity in coming quarters,” MFR economist Joshua Shapiro wrote in a note to clients. “Fiscal stimulus will help to blunt this, but is unlikely to turn the tide completely.”

Markets are Overbought; Retail Numbers = Long Way to Go

Disappointing retail sales numbers in March, after two stronger-than-expected months, show the consumer has not turned the corner after all, and may “go back in his cocoon,” according to Art Cashin of UBS.  The market is overbought and vulnerable to a pullback — perhaps even a sharp pullback over the next three days — with option expiration built in.  He is hopeful we have set the lows for the cycle, although those lows may be tested, and he foresees a lot of “sideways churning for maybe months.

My Note: Unfortunately if sideways churning includes testing those lows then I absolutely agree if those lows hold. Unfortunately, I don’t think they will, can you say DOW 4500? – jschulmansr

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Oil and Gold to Figure Large This Week – Seeking Alpha

By: Brad Zigler of Hard Assets Investor

Real-time Monetary Inflation (per annum): 7.9%

 

Easter Mondays leave Yanks more time to leisurely ponder the week’s trading prospects, as many global bourses are closed. We get to trade – and talk, as Linda Richman used to suggest – amongst ourselves.

Gold and oil naturally figure large in this week’s scenario. Particularly, oil over gold, if you’ve been listening to commodity maven Jim Rogers. Rogers thinks the International Monetary Fund [IMF] is a likely seller of some of its 3,200-ton metal stash, so he’s talking up black gold over yellow.

It’s not as if the world finds this surprising. Whether the IMF sales take place or not, the world’s been spoiling for a showdown between the two commodities.

Let’s look at oil first. The nearby crude contract gathered strength in its 50% retracement of the February-March rally, and is now poised to challenge the run-up’s $54.64 high.

Nearby NYMEX WTI Crude

Nearby NYMEX WTI Crude

True, near-term fundamentals still indicate oversupply. The re-growth in the contango tells you that. The quarterly carry trade was pinched to 80 cents a barrel a month ago; now it’s in the $4-5 range. If you’ve got a carrying charge market, you’ve got commodity enough to carry into future deliveries.

No, this has been a rally built more on expectations of improving economic prospects – hand-in-hand with the equity market rally – than on a supply retraction. Oil inventories at the Cushing, Okla., terminus may be down from their peak, but supplies in other regions have ballooned to more than compensate for the off-take.

Now, about gold …

Momentum and sentiment have turned sour for the yellow metal. But you probably suspected that, right? The recent 30,000-contract downdraft in COMEX open interest was led mostly by fund sellers. Net long positions held by large speculators tumbled more than 18% last week.

COMEX Nearby Gold

COMEX Nearby Gold

Technically, gold’s very vulnerable. Pushed to test its 100-day moving average on the downside and weighed down by overhead resistance at the $888 level – formerly support for the February-March topping action – the nearby market’s squeezed. Gold spreads (as mentioned in “Another ‘Make It Or Break It’ Hurdle For Gold“) indicate plenty of liquidity in the lease market. Supply’s not the issue for gold either. At least not yet.

Oil’s technical strength over gold is readily apparent in the gold/oil ratio. A rising ratio, meaning gold’s price is gaining on oil’s, is indicative of poorer economic conditions to come. A decline, not surprising, signals the market’s forecast of better prospects. The ratio’s been testing the 17-to-1 level over the past couple of weeks. An oil breakout could put this indicator on course to look for support at the 15-to-1 level.

Gold/Oil Ratio

Gold/Oil Ratio

It seems traders are essentially anticipating a reflation trade by making one of the primary engines of inflation, oil, their target rather than gold, inflation’s classic beneficiary.

This should be an interesting week.

===================================================

My Note: Brad you need to remember this time the Miner’s have started to begin the rally not the bullion market. When that happens Gold always rises. But with the producer’s/miner’s leading we will have a much stronger and deeper rally this time, I’m looking for $1200 – $1500 by year’s end! Have a Great Evening, don’t forget tomorrow is National Tea Party Day! – jschulmansr

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Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

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Emergency Broadcast- Wake Up! It is Almost Too Late!

04 Saturday Apr 2009

Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, ANV, Austrian school, AUY, Bailout News, banking crisis, banks, Barack, Barack Hussein Obama, Barack Obama, bear market, Bear Trap, Bildenberger's, Bollinger Bands Saudi Arabia, Brian Tang, bull market, capitalism, CDE, CEF, central banks, CFR, China, Comex, commodities, communism, Conservative, Conservative Resistance, Contrarian, Copper, Council on Foreign Relations, crash, Credit Default, Currencies, currency, Currency and Currencies, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, Dow Industrials, economic, Economic Recovery, economic trends, economy, EGO, Federal Deficit, federal reserve, Finance, financial, follow the money, follow the news, Forex, fraud, FRG, Fundamental Analysis, futures, futures markets, G-20, gata, GDX, GG, GLD, gold, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, GTU, hard assets, HL, How To Invest, How To Make Money, hyper-inflation, IAU, IMF, India, inflation, Investing, investments, Jeffrey Nichols, Jim Rogers, Jim Sinclair, John Embry, Jschulmansr, Julian D.W. Phillips, Keith Fitz-Gerald, majors, Make Money Investing, manipulation, Marc Faber, Market Bubble, market crash, Markets, Michael Zielinski, mid-tier, mining companies, mining stocks, monetization, Moving Averages, NAK, New World Order, NGC, NWO, NXG, obama, oil, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, S&P 500, safety, Sean Rakhimov, silver, silver miners, Silver Price Manipulation, SLW, small caps, socialism, sovereign, spot, spot price, stagflation, Stimulus, stock market, SWC, TARP, Technical Analysis, The Fed, TIPS, Today, U.S., U.S. Dollar, volatility, warrants, XAU

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ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, CDE, CEF, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, gold miners, GTU, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, John Embry, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NAK, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, SWC, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

We are watching history unfold before our very eyes while being skillfully manipulated, distracted, and kept in the dark. This special edition has video’s, articles, and proof that we are being played for suckers and fools. “They” think if the can keep us hypnotized and asleep that they will succeed. What is needed today is a new generation of Paul Revere’s to sound the alarm for Americans. We have been invaded and are losing the war without so much as a whimper! NOW right now is the time to stop being Democrats, Republicans, Libertarians, now is the time to UNITE AS AMERICANS! WE NEED TO KEEP AMERICA FREE AND WE NEED TO START NOW! IT IS ALREADY ALMOST TOO LATE!

***PLEASE*** Do your own research and find out for yourself… Google Search the terms”New World Order”, “TriLateral Commission”, “Council on Foreign Relations”, and “Bildenberger’s” find out how many highly respected people are finally starting to warn you about this sinister and outright grab for world domination! After you finish this post, please pass/send the link to this post onto as many people as you can… before it is too late! -jschulmansr

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This was sent to me by Peter Grandich

Peter Grandich was the founder and managing member of Grandich Publications which published The Grandich Letter since 1984. His commentary on the mining and metals markets have been read by tens of thousands of subscribers and relied upon by major financial media around the world.

Here is his Latest Blog Post

Grandich Opens The Closet Door Again – Agoracom

By: Peter Grandich

When I came out of the closet, I made it known I would do more than just comment about markets here. I knew some would not like it then and I know some will not like it now.

From time to time during my 25 years in and around the financial industry, I would come across an individual or group who would preach about “A New World Order” or something to that effect. I found most of these people either “out in left field” or had an agenda to sell products and services to go along with their “views”. However in recent times, I’ve come across some very intelligent people and groups who have demonstrated to me they were neither kooks nor salesmen. Their thoughts and opinions were both logical and reasonable.

After watching and listening to what has unfolded at the G-20 this past week and what’s been evolving in Washington and throughout the United States, I no longer wonder is something along the lines of a “New World Order” possible, but rather how far long are we to one?

This is not a kook’s only video.

As an American, I’m extremely concern we’re losing (or already lost) what made this country once great. I believe our President and me see things much differently. I find what this gentleman portrayed in this video to be of keen interest to me and what I believe this country must do before it’s too late.

Finally, I’ve had more discussions with various people about what we can do if we’re truly entering a tribulation or a way of life totally different then our past generations. I tell them I worry too but then I try to remember this and to realize the battle may be near but the outcome has already been determined.

“Jesus said, I have told you these things so that in me you may have peace. In this world you will have trouble. But take heart! I have overcome the world.”    John 16:33

Have a most blessed Holy Week!

Here is the Video…

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Next Comes From Alex Jones of Prison Planet.com

The Obama Deception HQ Full length version- You Tube

Source: You Tube

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This is From Bloomberg Financial News:

G-20 To Shapes New World Order With Lesser Role For U.S., Markets – Bloomberg.com

By Rich Miller and Simon Kennedy

April 3 (Bloomberg) — Global leaders took their biggest steps yet toward a new world order that’s less U.S.-centric with a more heavily regulated financial industry and a greater role for international institutions and emerging markets.

At the end of a summit in London, policy makers from the Group of 20 yesterday delivered a regulatory blueprint that French President Nicholas Sarkozy said turned the page on the Anglo-Saxon model of free markets by placing stricter limits on hedge funds and other financiers. The leaders also pledged to triple the resources of the International Monetary Fund and to hand China and other developing economies a greater say in the management of the world economy.

“It’s the passing of an era,” said Robert Hormats, vice chairman of Goldman Sachs International, who helped prepare summits for presidents Gerald R. Ford, Jimmy Carter and Ronald Reagan. “The U.S. is becoming less dominant while other nations are gaining influence.”

A lot was at stake. If the leaders had failed to forge a consensus — Sarkozy this week threatened to quit the talks if they didn’t back much tighter regulation — it might have set back the world’s economy and markets just as they’re showing signs of shaking off the worst financial crisis in six decades.

That’s what happened in 1933, when President Franklin D. Roosevelt torpedoed a similar conference in London by rejecting its plan to stabilize currency rates and in the process scotched international efforts to lift the world out of a depression.

More Conciliation

Seeking to avoid a repeat of that historic flop, President Barack Obama junked the at-times go-it-alone approach of his predecessor, George W. Bush, and adopted a more conciliatory stance toward his fellow leaders.

“In a world that is as complex as it is, it is very important for us to be able to forge partnerships as opposed to simply dictating solutions,” Obama told a press conference at the conclusion of the summit.

Stock markets rose in response to the steps taken by the G-20 leaders. The Standard & Poor’s 500 Index climbed 2.9 percent to 834.38. The Dow Jones Industrial Average added 216.48 points, or 2.8 percent, to 7,978.08. Both closed at their highest levels since the second week of February.

In an effort to promote harmony, Obama soft-pedaled earlier U.S. demands that the summit agree on a specific target for fiscal stimulus in the face of opposition from France and Germany. Instead, he settled for a vague pledge that the leaders would do whatever it takes to revive the global economy.

Repudiation of Past

The president also signed on to a communiqué that Nobel Laureate Joseph Stiglitz said repudiated the previous U.S.-led push to free capitalism from the constraints of governments.(See My Post From Yesterday For Actual Article)

“This is a major step forward and a reversal of the ideology of the 1990s, and at a very official level, a rejection of the ideas pushed by the U.S. and others,” said Stiglitz, an economics professor at Columbia University. “It’s a historic moment when the world came together and said we were wrong to push deregulation.”

In bowing to that view, the leaders conceded in a statement that “major failures” in regulation had been “fundamental causes” of the market turmoil they are trying to tackle. To make amends and to try to avoid a repeat of the crisis, they pledged to impose stronger restraints on hedge funds, credit rating companies, risk-taking and executive pay.

“Countries that used to defend deregulation at any cost are recognizing that there needs to be a larger state presence so this crisis never happens again,” said Argentine President Cristina Fernandez de Kirchner.

Financial Stability Board

A new Financial Stability Board will be established to unite regulators and join the IMF in providing early warnings of potential threats. Once the economy recovers, work will begin on new rules aimed at avoiding excessive leverage and forcing banks to put more money aside during good times.

German Chancellor Angela Merkel, who had unsuccessfully sought to convince the U.S. and Britain to sign on to similar steps before the crisis began in mid-2007, hailed the communiqué as a “victory for common sense.”

The U.S. did, though, take the lead in getting the summit to agree on an increase in IMF rescue funds to $750 billion from $250 billion now. Japan, the European Union and China will provide the first $250 billion of the increase, with the balance to come from as yet unidentified countries.

“This will provide the IMF with enough resources to meet the needs of East European nations and also provide back-up funding to a broader set of countries,” said Brad Setser, a former U.S. Treasury official who’s now at the Council on Foreign Relations in New York.

IMF Allocation

The G-20 also agreed to an allocation of $250 billion in Special Drawing Rights, the artificial currency that the IMF uses to settle accounts among its member nations. The move is akin to a central bank such as the Federal Reserve effectively creating money out of thin air, except it’s on a global scale.

The increase in Special Drawing Rights will allow countries to tap IMF money without having to accept changes to economic policies often demanded as a condition of aid. The cash is disbursed in proportion to the money each member-nation pays into the fund. Rich nations will be allowed to divert their allocations to countries in greater need.

The G-20 said they would couple the financing moves with steps to give emerging economic powerhouses such as China, India and Brazil a greater say in how the IMF is run.

Emerging Markets Benefit

Citigroup Inc. economists Don Hanna and Jurgen Michels called the summit agreement “a boon to emerging markets” in a note to clients yesterday.

Mexico said Wednesday it will seek $47 billion from the IMF under the Washington-based lender’s new Flexible Credit Line, which allows some countries to borrow money with no conditions.

Emerging-market stocks, bonds and currencies rallied yesterday on speculation other developing nations will follow Mexico’s lead. Gains in Polish, Czech and Brazilian stocks helped push the MSCI Emerging Markets Index up 5.6 percent to 613.07, the highest since Oct. 15.

In a bid to avoid another mistake of the depression era, G-20 leaders repeated an earlier pledge to avoid trade protectionism and beggar-thy-neighbor policies that could aggravate the decline in the global economy.

The Paris-based Organization for Economic Cooperation and Development predicted this week that global trade will shrink 13 percent this year as loss-ridden banks cut back on credit to exporters and importers.

Trade Finance

To help combat that, the G-20 said they will make at least $250 billion available in the next two years to support the finance of trade through export credit agencies and development banks such as the World Bank.

The summit took place amid speculation among investors that the deepest global recession in six decades may be abating. Data released yesterday showed orders placed with U.S. factories rose in February for the first time in seven months, U.K. house prices unexpectedly gained in March and Chinese manufacturing increased. Still, a report today is forecast to show U.S. unemployment at its highest in a quarter-century.

“If the economy turns more favorable, this meeting will probably be viewed as a milestone,” said C. Fred Bergsten, a former U.S. official and director of the Peterson Institute for International Economics in Washington.

The G-20 members are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, South Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the U.S., the U.K. and the European Union. Officials from Spain and the Netherlands were also present.

To contact the reporters on this story: Rich Miller in Washington rmiller28@bloomberg.net; Simon Kennedy in Paris at Skennedy4@bloomberg.net

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G20 ushers in a ‘new world order’- Globe and Mail

BOLD STEPS 8 Leaders shift from U.S. model of freewheeling finance, forming historic accord to regulate risk UNITED FRONT 8 Countries pledge $1-trillion in aid for struggling nations, but economists blast lack of new stimulus

ERIC REGULY AND BRIAN LAGHI

April 3, 2009

LONDON — The leaders of the Group-of-20 countries put on a show of unity yesterday to fight the global recession with pledges of more than $1-trillion (U.S.) in aid to help struggling countries and revive trade.

But their failure to unveil new stimulus spending was criticized as a “disappointment” by economists, who fear the global downturn will only deepen unless governments everywhere open the stimulus spigots even further.

The G20 countries also agreed to rein in the world’s financial system through the creation of international accounting standards, the regulation of debt-ratings agencies and hedge funds, a clampdown on tax havens and controls on executive pay. But the lack of details on these proposals suggests they will not become effective any time soon.

U.S. President Barack Obama, who had been calling for more stimulus spending, nonetheless welcomed the communiqué.

“The steps that have been taken are critical to preventing us sliding into a depression,” Mr. Obama told reporters after the close of the G20 gathering. “They are bolder and more rapid than any international response that we’ve seen to a financial crisis in memory.”

Characterizing the agreement as historic, British Prime Minister Gordon Brown, the summit’s host, said the agreement ushered in a new period of international co-operation while ending the era of the Washington consensus, a term from the late 1980s that has come to be equated with market fundamentalism.

“Today we have reached a new consensus that we take global action together to deal with problems that we face, that we will do what is necessary to restore growth,” he said.

Prime Minister Stephen Harper joined fellow leaders in the praise, saying new regulations will help the market work better. “The declaration is very clear that globalization, that open markets, that liberalized trade remain the essential base of our economic system and will be the basis of any recovery and future economic growth,” he said.

The agreement was the object of last-minute negotiations, and overcame the initial objections of German Chancellor Angela Merkel and French President Nicolas Sarkozy, who at one point threatened to leave the meeting if it did not agree with his position on stricter regulation of the financial world.

Ms. Merkel said she was pleased the group came to a broad agreement after such a short period of time. “We now have been able to rally around a message of unity,” she told a news conference.

Mr. Sarkozy said his alliance with Ms. Merkel worked well.

“We would never have hoped to get so much,” he said.

Yesterday’s agreement calls for the creation of a Financial Stability Board, which is designed to work with the International Monetary Fund to provide early warning of financial risks and the actions needed to reduce them. The agreement says the countries will take action against tax havens by slapping sanctions against offending nations. “The era of banking secrecy is over,” the communiqué said.

The $1-trillion-plus in emergency aid is anchored by a commitment to add $500-billion to the resources of the IMF, taking it to $750-billion, a level that should give it enough firepower to extend bailout loans to the hardest-hit countries. Of this amount, $100-billion will come from the European Union, $100-billion from Japan and $40-billion from China.

Another $250-billion will be given to the IMF to support special drawing rights, the organization’s own “basket” currency that can be used to boost global liquidity. Trade finance will be supported with $250-billion channelled through the World Bank and export agencies, though almost none of that amount has been committed yet. The IMF has also agreed to sell gold reserves to provide as much as $50-billion in aid to the poorest countries.

The G20’s IMF measures were more aggressive than expected and helped lift the world’s markets. Commodities such as oil and metals rose as traders evidently took the view that global growth would revive more quickly than they had expected. News of possible U.S. accounting changes of the mark-to-market rules, used to value assets, helped to trigger a bank rally.

“What is most encouraging for the G20 leaders summit in London today is the building evidence that the Lehman-related collapse in global demand seems to be coming to an end,” Derek Halpenny, the head of currency research at Bank of Tokyo-Mitsubishi UFJ in London said in a report yesterday.

The communiqué also called on countries to resist protectionist measures.

The regulatory changes agreed by the G20 countries are sweeping, but lacked detail about their scope and implementation, whether or not they could be enforced globally or nationally.

Mr. Brown said that hedge funds, whose failure can trigger a domino effect in the financial-services industry, would be subject to greater regulation and oversight. Pay and bonuses will have to adhere to “sustainable” compensation schemes.

“There will be no more rewards for failure,” Mr. Brown said.

The leaders, emboldened by the recent progress in prying open tax havens, said sanctions will be slapped on any sponsor country that refuses to sign international agreements to exchange tax information.

Mr. Brown said another G20 summit will take place late this year – city to be determined – to review the measures unveiled yesterday and at previous summits

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Finally From Jim Sinclair

More of The Exact Same- JSMinset.com

My Dear Friends,

All that has changed is more of what caused this problem in the first place. You are being lied to yet again.

1. Gold is your lifeline, nothing else. I assure you of this.

2. When reality hits, as it will, it will be too late to seek a lifeline.

3. If you let go of your lifeline you have put more into harm’s way than just an investment or a portfolio item.

4. In the final analysis gold and the dollar are inverse to each other.

5. The dollar is only considered a lifeline when viewed from the intoxicants of spin.

6. Gold is a currency.

7. Gold currency is the monetary unit of last resort. Reality is that we all will require a last resort.

8. The G20 was not an intervention that can stop a downward spiral because it produced more of the stuff that caused the disaster in the first place, monetary inflation. 9. Monetary inflation is what the downward spiral is made of.

10. Be logical.

11. Stop being emotional.

12. Anything you can stare down, you can overcome. Stare down your foolish emotions and adhere to reason.

The following is hot air and fabrication. There is no new world. All that has occurred is the plan to create USD $1 Trillion in new monetary inflation. The G20 was all PR that produced more of what has caused the disaster in the first place, another one trillion in monetary inflation that has no means of being withdrawn ever from the international system.

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My Note: Protect Yourself, Help Claim America Back. Do your research on what is really going on try these searches in Google NWO- New World Order, CFR- Council On Foreign Relations, Bildenberger’s. Judge for yourself especially in light of what you watched in the videos. Buy Gold, and then take action to save our country! -jschulmansr

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Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

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The Birthers’ Are Back – And At The Supreme Court!

25 Wednesday Mar 2009

Posted by jschulmansr in 2008 Election, Barack, Barack Dunham, Barack Hussein Obama, Barack Obama, Barry Dunham, Barry Soetoro, capitalism, Chicago Tribune, Columbia University, Credit Default, Currencies, currency, Currency and Currencies, D.c. press club, dollar denominated, dollar denominated investments, economic, Economic Recovery, economic trends, economy, Electoral College, Electors, Fed Fund Rate, Federal Deficit, federal reserve, Finance, financial, fraud, Free Speech, gold, Harvard Law School, hawaii, hyper-inflation, id theft, IMF, Indonesia, Indonesian Citizenship, inflation, Investing, investments, Joe Biden, John McCain, Latest News, legal documents, Markets, name change, natural born citizen, Oath of Allegiance of the President of the United State, obama, Occidental College, Phillip Berg, Politics, poser, Presidential Election, Sarah Palin, socialism, stagflation, Stimulus, Stocks, The Fed, Today, treason, U.S., u.s. constitution, U.S. Dollar, voter fraud, we the people foundation

≈ Comments Off on The Birthers’ Are Back – And At The Supreme Court!

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2008 Election, Barack Dunham, Barack Hussein Obama, Barack Obama, Barry Dunham, Barry Soetoro, capitalism, Chicago Tribune, Columbia University, Currency and Currencies, D.c. press club, Electoral College, Electors, Finance, fraud, Free Speech, gold, Harvard Law School, hawaii, id theft, Indonesia, Indonesian Citizenship, Investing, investments, Joe Biden, John McCain, Latest News, legal documents, Markets, name change, natural born citizen, Oath of Allegiance of the President of the United State, Occidental College, Phillip Berg, Politics, poser, Presidential Election, Sarah Palin, socialism, Stocks, Today, treason, u.s. constitution, U.S. Dollar, voter fraud, we the people foundation

I am not a “birther” unless- my asking Mr. Obama to provide his Birth Certificate for everyone to see- qualifies me as one. The idea that Mr. Obama refuses to do so borders on unbelievable! Now he is facing “criminal” charges because he hasn’t. Please don’t tell me he already has, he hasn’t. The certificate of live birth is not the same as a Birth Certificate, and even that was proven to be a forgery! Next why is he refusing to let anyone see anything about his personal past history, like school records,and anything where then he had to show some kind of identification to be registered and be enrolled. Mr. Obama, what are you hiding? Could it actually be that you really aren’t qualified and eligible to be the President? I have some real concerns and now the rest of America is starting to share those concerns! Could your meeting with the Supreme Court Justice’s was really about that very issue? Something like, hey guys I’m not actually eligible to be President, so if you ‘hear any of the “eligibility” cases’ and this is found out (not eligible to be President)- it will cause widespread rioting and destruction; along with a complete loss of trust by the American people. Is that what really transpired? Mr. Obama prove your eligibility! Another concern I have is what you are doing to this country. You say you inherited this mess from President Bush and a 1 Trillion Deficit mess. Yet your cure is to spend 10 Trillion of American money (to supposedly fix the problem), more money total, than every President from Washington to Bush Jr. combined! Our own allies are even imploring you to stop this disastrous course. China is warning you that they are going to buy less, if any at all of our new debt you are having issued, and are afraid they are going lose big time on their investments in our debt because of it. Your policies are destroying the American dollar or is that part of your plan? You continue to have your agents in the Fed and treasury illegaly try to artificially supress precious metals prices, especially Gold and Silver prices by leasing out or outright selling of America’s Gold at a negative basis. Why is their no transparency and accounting of where and how America’s gold is being used. China and Russia are calling for a new reserve currency run by the IMF and where the U.S. Dollar would only represent 40% of the value of the currency basket. One minute you are against that along with Geitner and the next you are both saying that that might be a good idea? Real time inflation. not the conjured, manipulated reports (like yesterday’s durable goods); currently the inflation rate is at 8.5% up another point in just the last month! China and Russia are aware of this and are buying up and increasing their Gold Reserves to protect themselves from Inflation and a falling Dollar. Next you are mortgaging my kids, grandchildren. and great grandchildren’s futures under an onerous, outrageous levels of debt. . So I ask based on these facts alone – Mr. Obama where is your Birth Certificate? If you don’t have anything to hide then why not, just order the State of Hawaii to provide (unseal) the Birth Certificate? What are you afraid of? Mr. Obama prove your eligibility to be the President of the United States…

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Justice, Supremes confirm getting Eligibility Challenge- World Net Faily

By: Bob Unruh of World Net Daily

© 2009 WorldNetDaily

The U.S. Supreme Court and the U.S. Justice Department today confirmed that documentation

challenging Barack Obama’s eligibility to be president has arrived and soon will be evaluated.

Confirmation came from Defend Our Freedoms, the foundation through which California attorney

Orly Taitz has been working on a number of cases that raise questions over Obama’s qualification to be president under the Constitution’s demand that the office be occupied only by a “natural born” citizen.

Taitz was informed by Karen Thornton of the Department of Justice that all of the case documents and filings have arrived and have been forwarded to the Office of Solicitor General Elena Kagan, including three dossiers and the Quo Warranto case.

“Coincidently, after Dr. Taitz called me with that update, she received another call from Officer Giaccino at the Supreme Court,” the website posting said. “Officer Giaccino stated both pleadings have been received and [are] being analyzed now.”

The report from the Supreme Court said the documents that Taitz hand-delivered to Chief Justice John Roberts at his appearance at the University of Idaho a little over a week ago also were at the Supreme Court.

WND has reported on dozens of legal challenges to Obama’s status as a “natural born citizen.” The Constitution, Article 2, Section 1, states, “No Person except a natural born Citizen, or a Citizen of the United States, at the time of the Adoption of this Constitution, shall be eligible to the Office of President.”

Where’s the proof Barack Obama was born in the U.S. or that he fulfills the “natural-born American” clause in the Constitution? If you still want to see it, join more than 340,000 others and sign up now!

Some of the legal challenges question whether he was actually born in Hawaii, as he insists. If he was born out of the country, Obama’s American mother, the suits contend, was too young at the time of his birth to confer American citizenship to her son under the law at the time.

Other challenges have focused on Obama’s citizenship through his father, a Kenyan subject to the jurisdiction of the United Kingdom at the time of his birth, thus making him a dual citizen. The cases contend the framers of the Constitution excluded dual citizens from qualifying as natural born.

Further, others question his citizenship by virtue of his attendance in Indonesian schools during his childhood and question on what passport did he travel to Pakistan three decades ago.

Adding fuel to the fire is Obama’s persistent refusal to release documents that could provide answers. While his supporters cite an online version of a “Certification of Live Birth” from Hawaii, critics point out such documents actually were issued for children not born in the state.

WND reported earlier on a proposal by U.S. Rep. Bill Posey, R-Fla., and the criticism he’s taking for suggesting that the issue be avoided in the future by having presidential candidates supply their birth certificate.

“What you should do is stop embarrassing yourself and take the Reynolds Wrap off your head,” MSNBC commentator Keith Olbermann suggested to Posey.

U.S. Rep. Neil Abercrombie, D-Hawaii, has asserted Posey’s judgment is skewed.

“The citizenship of someone who has reached the point of running for president of the United States is not really an issue,” Abercrombie said.

Posey said he made the suggestion because he’s seeking the truth, and “the more and more I get called names by leftwing activists, partisan hacks and political operatives for doing it, the more and more I think I did the right thing.”

Hawaiian officials have confirmed they have a birth certificate on file for Obama, but it cannot be released without his permission, and they have not revealed the information it contains.

John Eidsmoe, an expert on the U.S. Constitution working with the Foundation on Moral Law, told WND a demand for verification of Obama’s eligibility appears to be legitimate.

Eidsmoe said it’s clear that Obama has something in the documentation of his history, including his birth certificate, college records and other documents that “he does not want the public to know.”

Officials for the Obama campaign repeatedly have refused to comment on the questions, relenting only once to call the concerns “garbage.”

Other members of Congress have been reading from what appears to be a prepared script in response to queries about Obama’s eligibility:

Among the statements from members of Congress:

  • Sen. Jon Kyl, R-Ariz.: “Thank you for your recent e-mail. Senator Obama meets the constitutional requirements for presidential office. Rumors pertaining to his citizenship status have been circulating on the Internet, and this information has been debunked by Snopes.com, which investigates the truth behind Internet rumors.”
  • Sen. Mel Martinez, R-Fla.: “Presidential candidates are vetted by voters at least twice – first in the primary elections and again in the general election. President-Elect Obama won the Democratic Party’s nomination after one of the most fiercely contested presidential primaries in American history. And, he has now been duly elected by the majority of voters in the United States. Throughout both the primary and general election, concerns about Mr. Obama’s birthplace were raised. The voters have made clear their view that Mr. Obama meets the qualifications to hold the office of president.”
  • Sen. Sherrod Brown, D-Ohio: “President Obama has provided several news organizations with a copy of his birth certificate, showing he was born in Honolulu, Hawaii on August 4, 1961. Hawaii became a state in 1959, and all individuals born in Hawaii after its admission are considered natural-born United States citizens. In addition, the Hawaii State Health Department recently issued a public statement verifying the authenticity of President Obama’s birth certificate.”
  • U.S. Rep. Rush Holt, D-N.J.: “The claim that President Obama was born outside of the United States, thus rendering him ineligible for the presidency, is part of a larger number of pernicious and factually baseless claims that were circulated about then-Senator Obama during his presidential campaign. President Obama was born in Hawaii.” The response provided no documentation.

Taitz had approached Justice Antonin Scalia during his appearance in Los Angeles before meeting with Roberts at his Idaho appearance. She’s suggested that there was misbehavior at the Supreme Court because some of her earlier papers were not filed properly, nor were they returned to her.

Hers was just one of the issues reportedly presented to the Supreme Court justices in conference for an evaluation on whether a hearing should be held. No hearing ever has been held at that level on the evidence involved. Her Quo Warranto case is pending at the Justice Department. It essentially raises a demand for proof by what authority Obama has assumed the powers of president.

Here is a partial listing and status update for some of the cases over Obama’s eligibility:

  • New Jersey attorney Mario Apuzzo has filed a case on behalf of Charles Kerchner and others alleging Congress didn’t properly ascertain that Obama is qualified to hold the office of president.
  • Pennsylvania Democrat Philip Berg has three cases pending, including Berg vs. Obama in the 3rd U.S. Circuit Court of Appeals, a separate Berg vs. Obama which is under seal at the U.S. District Court level and Hollister vs. Soetoro a/k/a Obama, (now dismissed) brought on behalf of a retired military member who could be facing recall to active duty by Obama.
  • Leo Donofrio of New Jersey filed a lawsuit claiming Obama’s dual citizenship disqualified him from serving as president. His case was considered in conference by the U.S. Supreme Court but denied a full hearing.
  • Cort Wrotnowski filed suit against Connecticut’s secretary of state, making a similar argument to Donofrio. His case was considered in conference by the U.S. Supreme Court, but was denied a full hearing.
  • Former presidential candidate Alan Keyes headlines a list of people filing a suit in California, in a case handled by the United States Justice Foundation, that asks the secretary of state to refuse to allow the state’s 55 Electoral College votes to be cast in the 2008 presidential election until Obama verifies his eligibility to hold the office. The case is pending, and lawyers are seeking the public’s support.
  • Chicago attorney Andy Martin sought legal action requiring Hawaii Gov. Linda Lingle to release Obama’s vital statistics record. The case was dismissed by Hawaii Circuit Court Judge Bert Ayabe.
  • Lt. Col. Donald Sullivan sought a temporary restraining order to stop the Electoral College vote in North Carolina until Barack Obama’s eligibility could be confirmed, alleging doubt about Obama’s citizenship. His case was denied.
  • In Ohio, David M. Neal sued to force the secretary of state to request documents from the Federal Elections Commission, the Democratic National Committee, the Ohio Democratic Party and Obama to show the presidential candidate was born in Hawaii. The case was denied.
  • Also in Ohio, there was the Greenberg v. Brunner case which ended when the judge threatened to assess all case costs against the plaintiff.
  • In Washington state, Steven Marquis sued the secretary of state seeking a determination on Obama’s citizenship. The case was denied.
  • In Georgia, Rev. Tom Terry asked the state Supreme Court to authenticate Obama’s birth certificate. His request for an injunction against Georgia’s secretary of state was denied by Georgia Superior Court Judge Jerry W. Baxter.
  • California attorney Orly Taitz has brought a case, Lightfoot vs. Bowen, on behalf of Gail Lightfoot, the vice presidential candidate on the ballot with Ron Paul, four electors and two registered voters.

In addition, other cases cited on the RightSideofLife blog as raising questions about Obama’s eligibility include:

  • In Texas, Darrel Hunter vs. Obama later was dismissed.
  • In Ohio, Gordon Stamper vs. U.S. later was dismissed.
  • In Texas, Brockhausen vs. Andrade.
  • In Washington, L. Charles Cohen vs. Obama.
  • In Hawaii, Keyes vs. Lingle, dismissed.

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Federal Criminal Complaint contends Obama Ineligible – WND

By Bob Unruh
© 2009 WorldNetDaily

An ex-military officer has raised the stakes in the ongoing dispute over Barack Obama’s eligibility to be president, filing a criminal complaint against the “imposter” with the U.S. attorney’s office for the Eastern District of Tennessee.

Retired U.S. Navy officer Walter Francis Fitzpatrick III, who has run a campaign for two decades to uncover and try to correct what he believes are criminal activities within the military, accused the president of “treason.”

In his complaint addressed to Obama via U.S Attorney Russell Dedrick and Assistant U.S. Attorney Edward Schmutzer, Eastern District, Tennessee, Fitzpatrick wrote: “I have observed and extensively recorded invidious attacks by military-political aristocrats against the Constitution for twenty years.

“Now you have broken in and entered the White House by force of contrivance, concealment, conceit, dissembling, and deceit. Posing as an impostor president and commander in chief you have stripped civilian command and control over the military establishment.”

He cited the deployment of “U.S. Army active duty combat troops into the small civilian community of Samson, Ala.,” and said, “We come now to this reckoning. I accuse you and your military-political criminal assistants of TREASON. I name you and your military criminal associates as traitors. Your criminal ascension manifests a clear and present danger. You fundamentally changed our form of government. The Constitution no longer works.

“I identify you as a foreign born domestic enemy,” he wrote.

The 1975 graduate of the U.S. Naval Academy in Annapolis told WND that a short time after his complaint was filed he was visited by two U.S. Secret Service agents, but they left after telling him they perceived no threat to the president in the document.

Where’s the proof Barack Obama was born in the U.S. or that he fulfills the “natural-born American” clause in the Constitution? If you still want to see it, join some 350,000 others and sign up now!

Officials with the Knoxville office of the Secret Service told WND the only person who could release information to the media was on vacation and they would not comment on the issue.

Likewise, officials with the U.S. attorney’s office declined to respond to a WND request for a comment.

Fitzpatrick told WND the U.S. Justice Department needs to look into the issue.

WND reported this week that officials at the Justice Department, along with those at the Supreme Court, confirmed that documentation in a case challenging Obama’s eligibility had arrived and was scheduled for an evaluation.

That case is being handled by California attorney Orly Taitz, who is working through her Defend Our Freedoms Foundation to handle several cases raising questions over Obama’s qualification to be president under the Constitution’s demand that the office be occupied only by a “natural born” citizen.

Taitz was informed by Karen Thornton of the Department of Justice that all of the case documents and filings have arrived and have been forwarded to the Office of Solicitor General Elena Kagan, including three dossiers.

Fitzpatrick said he has devoted his career fulltime to investigating issues in military justice and defending wrongly accused soldiers, sailors and Marines. His own career was torpedoed by a court-martial more than 20 years ago over his authorization of the use of a ship’s fund to sent an officer to the funeral for his brother, who had been killed by terrorists.

Fitzpatrick’s situation has been described not only on his own website but forum pages on other websites that deal with military issues.

He alleges his case was fabricated and even his signature was forged by officials connected to his case. He points to the fact that he ultimately retired and was awarded a military pension as support for his allegations.

But he says the new complaint against Obama should define the issue of the president’s eligibility.

“They either have to come and get me or get Mr. Obama’s eligibility proved. He has an officer in his military saying he is guilty of trespass on the Constitution,” Fitzpatrick told WND.

“They can recall me against my will to active duty,” he said. “I would refuse. It’s an illegal order by a man who is not by commander in chief.”

WND has reported on dozens of civil case legal challenges to Obama’s status as a “natural born citizen.” The Constitution, Article 2, Section 1, states, “No Person except a natural born Citizen, or a Citizen of the United States, at the time of the Adoption of this Constitution, shall be eligible to the Office of President.”

Some of the legal challenges question whether he was actually born in Hawaii, as he insists. If he was born out of the country, Obama’s American mother, the suits contend, was too young at the time of his birth to confer American citizenship to her son under the law at the time.

Other challenges have focused on Obama’s citizenship through his father, a Kenyan subject to the jurisdiction of the United Kingdom at the time of his birth, thus making him a dual citizen. The cases contend the framers of the Constitution excluded dual citizens from qualifying as natural born.

Further, others question his citizenship by virtue of his attendance in Indonesian schools during his childhood and question on what passport did he travel to Pakistan three decades ago.

Adding fuel to the fire is Obama’s persistent refusal to release documents that could provide answers. While his supporters cite an online version of a “Certification of Live Birth” from Hawaii, critics point out such documents actually were issued for children not born in the state.

Hawaiian officials have confirmed they have a birth certificate on file for Obama, but it cannot be released without his permission, and they have not revealed the information it contains.

John Eidsmoe, an expert on the U.S. Constitution working with the Foundation on Moral Law, has told WND a demand for verification of Obama’s eligibility appears to be legitimate.

Eidsmoe said it’s clear that Obama has something in the documentation of his history, including his birth certificate, college records and other documents that “he does not want the public to know.”

Officials for the Obama campaign repeatedly have refused to comment on the questions, relenting only once to call the concerns “garbage.”

==================================================

My Note: Mr Obama, show us you are eligible, where is your birth certificate? – jschulmansr

Follow Me on Twitter and be notified whenever I make a new post!

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Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. – jschulmansr

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And the Winner Is…

13 Friday Mar 2009

Posted by jschulmansr in 10 year Treasuries, agricultural commodities, alternate energy, Bailout News, banking crisis, banks, Barack, Barack Hussein Obama, Barack Obama, bear market, bull market, capitalism, CDE, CEF, central banks, China, Comex, Contrarian, Copper, Currencies, currency, Currency and Currencies, deflation, depression, DGP, dollar denominated, dollar denominated investments, economic, Economic Recovery, economic trends, economy, Fed Fund Rate, Federal Deficit, Finance, financial, follow the news, Forex, Fundamental Analysis, futures, futures markets, gata, GDX, GLD, gold, Gold Bullion, Gold Investments, gold miners, GTU, hard assets, How To Invest, How To Make Money, hyper-inflation, IAU, IMF, India, inflation, Investing, investments, John Embry, Jschulmansr, Latest News, majors, Make Money Investing, market crash, Markets, mid-tier, mining companies, mining stocks, NAK, oil, palladium, physical gold, platinum, platinum miners, precious metals, price, prices, producers, production, rare earth metals, recession, risk, safety, Saudi Arabia, silver, silver miners, Silver Price Manipulation, spot, spot price, stagflation, Stimulus, Stocks, TARP, Technical Analysis, The Fed, Tier 1, Tier 2, Tier 3, TIPS, Today, U.S. Dollar, uranium, Uranium Miners, XAU

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Wow! again what a week in all of the markets. Gold is continuing to slowly build into a major rally, look for $1050 to go down this time! We have seen the retracement in the stocks (normal retracement) in a very bear marketas I also mentioned earlier. I still have my 720 Sp 500 puts and look for a nice pop before next weeks expiration. Continue to accumulate more mining stocks and I hope you got in to DGP when I did and let you know via twitter on Monday. The winner if you haven’t guessed is Gold! We have a new player entering into the melee. Crude Oil has finally flashed it’s first buy signal in 18 months. Look for strong resistance at the $50 mark. If it clears then we’re back to $80 minimum, probably $100 in the first leg. I would play this one slowly as there still is a huge pool sitting out there in tankers to be used up first before we can get into a serious rally in Crude Oil and distillates. One thing to mention is our President Obama, at least he waited until the close of markets before speaking yesterday, it almost seems he is determined to drive the stock markets down. If the Dow doesn’t hold here then the 5000 range for the Dow is not out of the question in fact a very real possibility; a full 70% retracement would actually take us down to the 4500 level. Protect yourself and Buy Gold any form and BUY it NOW! Good Investing! jschulmansr

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Can the U.S. survive $80 crude oil?- INO.COM
 

Source: INO.com

For the first time since September of 2007, the crude oil (NYME_CL) market has flashed a positive signal that it is headed higher. This is the first buy signal that we have seen in over 18 months in the energy markets. 

 

The big question is, if crude oil is headed higher, how much of a price increase can the US economy afford and withstand?

Here is a raw commodity that is used by everyone and the US has no control over. This key commodity to commerce just happens to be in areas that are normally hostile to the US. If we see a hiccup in the supply chain that changes this market dynamic, even for a short time period, we could see oil move back to the $80/barrel range in a heart beat.

So how will this affect the US equity markets? If crude oil heads back to the $75-$80 range, I expect that the major indices will head south. I call it the 551 syndrome. 5000 on the Dow, 500 on the S&P 500, and finally 1000 on the NASDAQ.

In this short video I will share with you the potential target zones we could see in the next 6 to 12 months in crude oil.

So with the trend in crude oil in a positive trajectory and the trend in the US equity markets in a negative trajectory, I think the two will feed off themselves. Look for traders and hedge funds to move aggressively in both these areas with abandon.

Lastly with no reinstatement of the up-tick rule, expect stocks to once again get pummeled to oblivion.

Enjoy the video and all the best in trading,

Adam Hewison
President, INO.com
Co-founder, MarketClub

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Sell the Swiss Franc, Buy Gold- Seeking Alpha 

Source: FP Trading Desk

“Forceful relaxation” – it brings to mind a trader at a Mexican beach resort, not Swiss monetary policy, but that is exactly what the Swiss National Bank (SNB) announced in its Monetary Policy Assessment Wednesday, joining a growing chorus of central banks engaging in quantitative easing. Sell the franc and buy gold.

The SNB cut its target range for three-month Libor by 25 basis points to a range of 0–0.75% and announced plans to purchase domestic bonds from the private sector and sell francs in the open market. The resulting biggest ever one-day drop in the franc versus the euro and dollar is likely to be followed by franc depreciation over the next year.

Swiss lending to foreigners brings new meaning to Lord Polonius’s advice to Laertes to “neither a borrower nor a lender be.” The Swiss risk losing more than the friendship of the Hungarians who borrowed extensively in Swiss Franc between 2006 and 2008. They also risk losing their money as Eastern Europe struggles under a mountain of debt. All told, Swiss banks claims on foreigners rose from five times Swiss GDP in 2000 to roughly eight times GDP in mid-2007, according to the Bank for International Settlements (BIS).

The majority of these claims are denominated in US dollars, and that factor will continue to put pressure on the franc versus the dollar over the next year. Swiss banks’ net US dollar books approached $300 billion by mid-2007, according to the BIS.

Now that the SNB is actively trying to push the franc down to raise inflation expectations in Switzerland, watch out. This policy raises the prospects for franc depreciation and increases the case for owning gold versus all reserve currencies.

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Related: This is one of a multitude of reasons to Buy Gold-see next article below – jschulmansr

Swiss Action sparks talk of ‘Currency War’ – Financial Times

Source: Financial Times

By Peter Garnham in London

Published: March 12 2009 20:14 | Last updated: March 12 2009 20:14

The Swiss National Bank moved to weaken the Swiss franc on Thursday, the first time a big central bank has intervened in the foreign exchange markets since Japan sought to weaken the yen in 2004.

The bank’s move, which sparked fears that other countries could follow suit, comes as the value of the Swiss franc has soared as investors seek a haven from the recent market turmoil. In October, after the collapse of Lehman Brothers, it rose to a record high of about SFr1.43 against the euro, a level it has come close to again in recent weeks.

 

But it fell to its lowest level this year on Thursday after the SNB said the currency’s strength represented an “inappropriate tightening of monetary conditions” as it battled against a slowdown in the Swiss economy.

“In view of this development, the SNB has decided to purchase foreign currency on the foreign exchange market to prevent any further appreciation of the Swiss franc against the euro,” the central bank said.

The Swiss franc dropped 2.6 per cent to SFr1.5192 against the euro and dropped 3.2 per cent to $1.1894 against the dollar.

Analysts said the move was likely to increase talk that countries were set to engage in a bout of competitive devaluation.

“Let the currency wars begin,” said Chris Turner at ING Financial Markets.

Countries around the world faced with the constraint of zero interest rate levels might feel it was acceptable to intervene to weaken their currencies in order to ease monetary conditions, he said, adding that other export-dependent economies such as Japan would “probably be at the head of the queue”.

Michael Woolfolk at Bank of New York Mellon agreed.

“Market intervention by a major central bank such as the SNB opens up the door for other central banks, namely the Bank of Japan, to follow suit,” he said. “The yen is widely perceived in Japan to be overvalued.”

The SNB also cut its interest rates by 25 basis points, taking its three-month Libor target range down to zero to 0.75 per cent, and announced plans to adopt a quantitative easing approach to monetary policy.

Analysts said the move towards quantitative easing was sparked by a drastic revision to the central bank’s forecast for growth, which is now expected to fall between 2.5 and 3 per cent in 2009, much worse than its previous forecast of a drop of between 0.5 and 1 per cent.

The SNB said economic conditions had deteriorated sharply since its last policy meeting in December and that there was a risk of deflation over the next three years.

“Decisive action is thus called for, to forcefully relax monetary conditions,” the central bank said.

Additional reporting by Haig Simonian in Zurich

Copyright The Financial Times Limited 2009

====================================================

John Embry: Gold and Silver Are the Ultimate Insurance Policy- Seeking Alpha

By: Andrew Mickey of Q1 Publishing

John Embry: Exclusive Interview with Canada’s Foremost Gold Investor

Is gold the next “hot” investment? Or will it never break through the $1,000 threshold?

Some of the world’s leading investors are currently placing their bets.

For instance, hedge fund manager David Einhorn recently bet big on gold. Einhorn manages $6 billion at Greenlight Capital and has averaged a 20% annualized return by booking only one losing year since 1996 (last year). His fund recently bought more than $200 million of SPDR Gold Trust ETF (NYSE:GLD) and more than $75 million worth of Market Vectors Gold Miner ETF (NYSE:GDX).

On top of that, the big money managers have already pumped billions of dollars directly into gold mining companies to fund takeovers and new mines and expansion.

It’s looking like a lot of smart and big money is betting on gold. And as the financial markets, economy, and future outlook worsen, gold is holding up as a last bastion of hope for many investors.

How can you get in on it? Is it just gold? What about silver? Where are the real values to be had? What about other hard assets – water, agriculture, etc.?

It’s best to start getting prepared now.

Most recently, Q1 Publishing’s own Andrew Mickey, editor of the Prosperity Dispatch, had a private one-on-one conversation with John Embry, one of the leading gold investors in the world.

Embry has been following the gold sector for 35 years (that’s since the early 1970’s) and is one of the leading authorities on gold. Embry is currently the Chief Investment Strategist for Sprott Asset Management – a legendary name to long-time gold investors.

Prior to joining Sprott, Embry oversaw more than $5 billion in assets including the Royal Precious Metal Fund as VP, Equities and Portfolio Manager for RBC, a top-tier Canadian bank. Under his watch, the Royal Precious Metals Fund returned 153% in 2002 and was ranked #1 across all funds in Canada (remember 2002 was a horrible year for stocks as tech stocks continued to fall).

Andrew Mickey: Precious metals have been getting a lot of attention lately. But it seems like there has been a divergence between gold and silver. We’ve been watching the gold to silver ratio (the number of ounces of silver which can be bought for an ounce of gold) get wider and wider. Gold to platinum too. Do you see the divergence tied to the industrial aspect of metals like platinum and silver, gold is the supreme precious metal, or is there something else going on behind the scenes?

John Embry: No – it’s a very strong manipulative aspect at work. If you go to the COMEX and look at the trading patterns and the short positions and such, clearly the prices are being messed around with.

Silver is a smaller market and can be messed around with more easily. I think silver probably has a bit more upside potential because the price is so far behind where it should be.

Andrew Mickey: So do you see silver as one of the bright spots?

John Embry: Oh yeah, it’s an extreme bright spot. I could easily see it three times where it is now in the not-that-distant future.

Andrew Mickey: As far as gold supply, there is one period in the world gold supply where gold production kind of crested around 2007 or 2008. Are we facing a “Peak Gold” kind of situation?

John Embry: Yeah, we have most assuredly crested in terms of mine supply without question.

Andrew Mickey: So, when you look at five, ten years out…let’s say in a world where gold is $2000 or $3000 or higher, how much more gold can realistically be produced in a year?

John Embry: Zero, I think. In fact, I think you probably need a lot more lead time – maybe five to ten years.

Just look at what happened in the ‘70s. The gold price went from $35 to $800 and, believe it or not, gold production was at a lower level worldwide after that 10-year period.

Now, the big question is what will happen this time? Number one, a lot of the existing mines are being depleted quite rapidly. Number two, when the gold price goes up a lot, mines generally tend to sort of drop the grade they mine because they can make a lot of money with lower grade and they can keep the good stuff for the bad times.

So by definition, they will be mining in the same number of tons but they will be taking the gold grade out of it, so collectively they will be mining less gold. They will make more money because the price is up but they will be mining less.

The other problem is that so many of the new interesting deposits that may or may not be developed in the future are located in these God-awful third world countries. They are having a real battle now with the governments, getting permitting, deciding who makes the money out of the mine, environmental issues etc. The gold deposits are all over the place and the governments are going to delay projects.

Say you find an ore body today. It would probably take a minimum of five years before the gold hits the market with all the attendant problems there are getting it into production. So all that’s already baked in the cake. The gold price could be doing anything it wanted for the next four or five years…gold production isn’t going to increase much – if any – at all.

Andrew Mickey: Amazing, gold production declining in the last great bull market for gold. So what does this mean for gold stocks, from your perspective? Where should we focus our investments across the whole range – from explorers all the way up to the majors?

John Embry: Right now, I think the majors are reasonably priced compared to the overall list. People have sort of focused on liquidity so they have gone after the majors and they bid them up aggressively and left a lot of the more illiquid situations behind.

That will all change. As gold becomes more popular and the price rises, at that point, money will filter down the food chain from the larger companies and they will go looking for the good quality smaller ones.

I particularly like some of the smaller producers now for a lot of reasons.

For one, they are going to make a ton of money in the current environment, particularly if they are producing outside the United States. Like some of the ones that are producing in Canada. The gold price yesterday was I believe $1,230 Canadian.

Another reason is because all of the costs of gold mining are dropping right now. Energy costs, steel prices, and all the things that went up so much and really hurt gold miners’ profitability. They are all going the other way now and at the same time the price of gold is going up. So I think that people are going to be pleasantly surprised going forward by the profitability of some of these mines, which have struggled up until recently.

So I am pretty bullish on small producers and anybody who has got a legitimate ore body that can be exploited sometime within the foreseeable future. I think they are going to be viewed positively too.

But the key thing to focus on is when their production will begin. If they don’t have to worry about getting through the environmental hurdles and getting the finance and et cetera, et cetera, they are going to make a lot of money.

Andrew Mickey: What do you see as the potential risks of politics and environmental concerns preventing anyone from starting production?

John Embry: They are not necessarily preventing a company from going into production, but they are certainly delaying it.

My favorite example is that probably the best ore body that’s been discovered in the last 10 years is Aurelian’s in Ecuador; which was subsequently acquired by Kinross (KGC). But the fact is, as long as the current government in Ecuador stays in power…I just don’t see the thing entering production.

So that’s what I am talking about. It’s such a fabulous mine if it were in a good geopolitical environment. It would be being built as we speak, but there is no progress towards building it at this point.

Andrew Mickey: The gold ETF (like the GLD) has been the number one recommended way to invest in gold in the U.S.

It’s a hot subject of debate by those who are new to gold and those which have been following it for while. The new people to gold always recommend the GLD. What are your thoughts?

John Embry: Well, they are just plain wrong in my opinion.

I think gold and silver are the ultimate insurance policy. When things got really bad in the system you want to make sure the vehicle you own has the gold and silver that it allegedly is supposed to have.

Now, I may buy gold and have it in my own possession. I know I have it. And then there are other gold and silver vehicles like Central Fund of Canada (NYSE:CEF) or Central Gold-Trust (NYSE:GTU), to cite a couple, where the gold is allocated. It’s in a vault and there are regular audits to prove everything that’s behind the vehicle is in fact there. So you are getting what you pay for.

Now, in the case of the ETF I am not totally sure. I mean if you read their prospectuses closely enough you’ll see there is some wiggle room. What they are trying to do is just track the gold price so you don’t necessarily need the physical gold. They could be using paper derivative types of products to back the stock.

What really made me kind of uncomfortable recently, was there was this dramatic ramp up in the amount of money going into the GLD ETF in particular. I looked around and I am going like, where is gold coming from?

As you know, the gold market is acknowledged by virtually everybody to be tight. I know mine supply is falling, I know that – I didn’t see any appreciable change in any of the inventory levels or any of the recognized exchanges like COMEX etc., and there was no particular acceleration in the Central Bank dispositions. So my question is, if suddenly all this new buying appeared because of the ETF having to sort of stock up, where did the gold come from?

I am not sure it bought any gold. I think they might have gone to COMEX and just bought a paper contract.

I don’t know. I just think there are better vehicles than ETFs.

Andrew Mickey: Switching gears a little bit here, let’s talk about the big picture. Everyone wants to know what’s going on.

It’s a crazy time. What’s your take? What going on in the general markets and where are we headed?

John Embry: I think we are probably headed for the worst economic debacle since the Depression – if not worse than that.

And the response for that by governments around the world is going to be, I think, a blizzard of paper money creation. They will run massive deficits, trying to prop up these economies.

So I think the major development is going to be ongoing issues of currency debasement. The value of paper money against real tangible assets is going to fall considerably. Right now, we are going through this deflationary scare. It won’t last. It will change into a hyperinflationary environment in the not too distant future.

Andrew Mickey: A kind of stagflationary situation like we saw in the 1970’s?

John Embry: No, worse than that. I think the inflation would be more intense. The decline in economic activity will probably be worse.

Andrew Mickey: What are the kinds of conditions that bring us to that state? Is it avoidable?

John Embry: Basically, we have already put the conditions in place. We ran economies with constantly too much leverage and debt.

Eventually, you reach a certain point where you can’t really add any more debt because the capacity for the system to handle it has been exhausted. Once it reverses, it’s very hard to change. They are going to try to change it by simply debasing the money.

Andrew Mickey: You seem to focus on the debasement of currencies as a government “solution” – for lack of a better term – to the problem. What are some of the best ways to protect ourselves from this situation? Which are you employing?

John Embry: Our strategy is pretty simple. What we really like is the monetary precious metals gold and silver. We don’t like anything in the financial sphere at this time. The companies that we like are the more solid companies providing basic services and what have you. We like the ones which don’t have overly leveraged balance sheets.

Andrew Mickey: What about other real asset classes. There are other sectors I know you follow outside of precious metals like agriculture. That’s the one thing that I’ve been completely excited about for years, but had to turn and run from over the summer. What’s your take on it now? Is it time to wade back in?

John Embry: Well, I am with you on agriculture. It’s a necessity that we must eat.

I guess one of the positive aspects of global growth is that the third world became a bit more affluent. Improvement in their diets put more demand into the world for basic food stuffs. Now that’s slowed down a bit.

I think the real arbiter in the short run might be the climate. I see a lot of industry people bringing this up, changing sunspots. These changes in the sunspots suggest that we may be facing drought conditions in a lot of the world all at the same time.

If that’s the case, I think you are going to see massive food shortages which would underrate a considerable price appreciation in the food because there will be a real fight for it.

Andrew Mickey: So, I don’t want to get too technical with this subject, I assume that you’re referring to increasing activity in sunspots?

John Embry: Yes, there is increasing activity in sunspots; which apparently, sort of cools the world out. It’s really interesting because there has always been, as you know, there is debate about global warming.

I do believe that all this carbon release is creating global warming, but at the same time, we have this mass of long cycles in nature which sort of move from the ice age then back to a period where it gets too hot. In that cycle, we are headed towards cooling again and the sunspot is just one aspect of it.

Andrew Mickey: Can the sunspots cause some of the farming areas to change?

John Embry: Yes, they do. They have a role – for whatever reason – they have a major impact on increasing odds of getting hit by a drought. We have a lot of droughts going on in the world currently. There are droughts in Australia, South America, Northern China and Africa. But Africa has always had a drought.

There is a lot of food supply interruption. If a drought were to strike North America then that would really create a problem. I have seen some work suggesting that we are due for a drought based on certain cycle work.

Andrew Mickey: Okay, this is more or less an agricultural cycle that you are referring to I imagine. How long is this kind of agriculture cycle? Is it like an 80-year almost Dust Bowl scenario type?

John Embry: Well, yes…I hesitate to go there because…it’s like Murphy’s Law, “everything goes wrong at the same time.” And with the financial world right now in a mess the last thing we need is a sort of replay of the ‘30s in the agricultural space.

The pessimists among us think that there is a good probability that drought conditions could strike North America, and that would be the last thing I want to see.

Andrew Mickey: What about farmland then? It’s an asset class which has had extremely consistent returns over the past 50 to 60 years. But, we’ve been waiting for a time like this.

John Embry: Farmland prices have fallen off a cliff. I just saw a guy in Minneapolis; again, he was saying that farmland is on offer everywhere right now.

This is a great thing. I am now in favor of buying farmland at the right price and that price is probably – as we are cleaning this whole mess up – the right price is going to be reached.

Andrew Mickey: The same is true for all kinds of natural resources. Oil, natural gas, copper, iron ore, uranium, etc. They’re all over the world and the government s which control them are in position to really inhibit or assist private companies who want to exploit them.

Recent US policy changes favor certain alternative energies. The one that really concerns me is uranium. In your opinion, when we look at uranium, should we look at it as declining uranium supply from current mines and or how new power plants can come on line if they can’t get it? Which is the real problem? Or is it both?

John Embry: Excellent question. I do think there is a problem. The Cigar Lake up in Northern Saskatchewan has gone through all sorts of problems. Another major problem area is with the Olympic Dam mine in Australia. It has been having problems too.

So again, there’s an issue with existing production.

In that light, I think that’s going to make new discoveries. Quality discoveries in uranium which are really worthwhile and the problem, again, is how long it’s going to take to exploit them. There just aren’t too many good deposits. We had that huge run in uranium a couple of years ago, but a lot of the deposits were really junky.

The great advantage in uranium is that the true cost of producing the power, is in building the reactor. So, there’s a lot of flexibility there. They don’t care about what they have to pay for uranium just as long as they can get it.

So I think that’s one of the aspects I like about uranium. The price is sort of inelastic in that sense. Just because the price goes up doesn’t mean it’s going to start to reduce demand.

Andrew Mickey: With respect to potash, nitrogen and phosphate, where do you see opportunities there? Most people are familiar with potash, the high capital costs to build a mine and the like. Are there any opportunities in nitrogen and phosphate because it’s too easy, how do you guys kind of look at those

John Embry: Well, we actually – we meaning our Sprott Resource Corp – have been looking around for interesting opportunities in phosphate and what have you. We believe that as this whole agricultural thing unfolds that it will be a good business.

But right now, farmers are having trouble getting money like everybody else is. So really, there is a bit of a low in the fertilizer business. Looking for longer term opportunities, the short term is going to be a little problematic.

Andrew Mickey: Are there any other things that you think individual investors should keep in mind as this is the first time in a long time that any of us had to go through a downturn like this?

John Embry: Well, it’s downright ugly out there. I was born in United States and I am a huge admirer of the U.S. I think what’s happened is tragic. Consequently, people are looking to protect themselves and I really do think that precious metals in particular and solid commodity opportunities are going to be one way that’s going to pay off in the end.

Andrew Mickey: What’s your take on all the stimulus packages and infrastructure building and everything that’s going on there?

We have been really bearish on infrastructure companies. How can the government support these businesses which are mostly private?

John Embry: I think that you are right. Typically, the market overacts to these things and obviously the infrastructure spending is partly implied; because, it’s been neglected to such a great extent in North America.

We have the same problem in Canada. Our roads are falling apart. Really, they could spend a ton of money in the sector. Problem is, they don’t have the money. They are going to have to create it out of thin air.

Andrew Mickey: One last thing. Are you currently looking at or investing in water? If so, would you be looking into water rights or a pipe manufacturer for example?

John Embry: We haven’t done as much as we should have. I think water is going to be a major issue going forward.

As for ways to invest in water, I’m more interested in water rights. The good thing about Canada is, there is lots of water up here. The problem is going to be down in the U.S., particularly in Southwest and other areas. I just look at that and I shake my head.

Andrew Mickey: Well, thanks very much for spending some time with us. Is there anything else that you would like to add?

John Embry: Just that I think that it’s important that your readers know all this. The world is a lot different than it was 10 years ago.

Andrew Mickey: And probably it will be a lot different in another 10 years.

John Embry: Well, it would be a lot different looking back from five years from now too, you bet, but I think we will be stood in good stead, certainly being in precious metals and end products, I think those are the two that I like the best.

Andrew Mickey: Well, thanks for your time, I appreciate it.

John Embry: My pleasure. Anytime.

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It’s Still Not Over- Part 2 Obama Where Is Your Birth Certificate?

03 Tuesday Mar 2009

Posted by jschulmansr in 2008 Election, Barack, Barack Dunham, Barack Hussein Obama, Barack Obama, Barry Dunham, Barry Soetoro, capitalism, Chicago Tribune, Columbia University, Currency and Currencies, D.c. press club, Electoral College, Electors, Finance, fraud, Free Speech, gold, Harvard Law School, hawaii, id theft, Indonesia, Indonesian Citizenship, Investing, investments, Joe Biden, John McCain, Latest News, legal documents, Markets, name change, natural born citizen, Oath of Allegiance of the President of the United State, obama, Occidental College, Phillip Berg, Politics, poser, Presidential Election, Sarah Palin, socialism, Stocks, Today, treason, u.s. constitution, U.S. Dollar, voter fraud, we the people foundation

≈ Comments Off on It’s Still Not Over- Part 2 Obama Where Is Your Birth Certificate?

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Wow! What a firestorm I raised when I posted Part 1 yesterday! I was called various names, accused of being an Indnesian secret agent, and more. Everyone went back and pointed out that the “Certificate of Live Birth” posted was the the proof and how stupid was I to keep bringing this up, or that I had “sour grapes”. So let me answer…This “proof” was proven by forensic experts to be a forgery with an edge border around the certificate from a different year than then year when Barak Obama was born.

Yet no one could post an answer to my next statement if I go to get my passport they U.S. Government will not accept that certificate as proof of citizenship; I must go get and provide my actual long form original certified copy of my Birth Certificate. They also could not provide an answer as to why Barak Obama will not produce his. Is he magically somehow above the rest of us as citizens? According to the constitution he is not!  

So I am still very concerned about Barak Obama’s eligibility to be my President. If he is really a legal citizen of the United States then why can’t he just provide his Birth Certificate?  Why is he hiring so may lawyers and legal defense teams to prevent people from seeing his information and keeping it sealed up? What does that information contain that he is afraid of? What does he have to hide?

Could the reason we have this problem is because Howard Dean and the Democrats never vetted their candidate? Just like Obama has not properly vetted his cabinet appointments. This is basic. If they can’t even do that right, how would you expect them to manage your health care? This is the reason we are now faced with this Constitutional dilemma. It is a major issue for anyone who must follow orders from the ‘Commander-in-Chief’, especially all our men in uniform. It can’t be that hard to find out if Obama is really a natural born American. This issue must be resolved, there is no question about it. Let’s get with it folks.    

This all seems surreal. Nothing like this fraud has ever been attempted before in the history of this Country. Who else knows what information are in those sealed documents and aided and abetted Obama in this fraud? Who were the people who was suppose to have vetted Obama? 

Here is this Man is taking up residence in the White House and being in control of everything including our nuclear weapons and no one has seen any documented proof of who this person really is or where he came from. He has also embarked on the largest spending program ever seen in this country which most financial experts agree will provide very little actual stimulus to you or me, the average American citizen. 

I don’t believe that the Attorney General will appoint a special Prosecutor to investigate these charges.

What is the next legal step?

The Supreme Court refuses to hear any of the cases that have been brought against Obama. It seems that may be why Obama had that closed meeting with the Court. He probably told the Justices something along the lines of “I’m not eligible, but if you take a case and rule against me there will be rioting in the streets. At which time I will be forced to call for Martial Law and that will probably lead to Revolution. If you leave well enough alone, they will eventually give up or I will have them shut up”. Either one of these scenarios will surely destroy us, So what happens now?

I will re-iterate this, I hope he can and will just show us bona-fide proof that he is an American citizen. Because as I just stated we will have either revolution or at least rioting in every major city of this country. If he does prove his eligibility I will be one of the first to shout this out from the rooftops! I will immediately publish both an apology and retraction of any and all articles which I have published doubting his American Citizenship. But at the rate Barak is trying to hide his personal information, the amount of money he is spending to keep it hidden is enough to cause ANY sane and prudent man to question what he is doing.

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More Military Officers Demand Eligibility Proof — World Net Daily

By Bob Unruh of World Net Daily

Plaintiff: ‘In the worst case … it’s going to be revolution in the streets’

Military officers from the U.S. Army, Navy, Air Force and Marines are working with California attorney Orly Taitz and her Defend Our Freedoms Foundation, citing a legal right established in British common law nearly 800 years ago and recognized by the U.S. Founding Fathers to demand documentation that may prove – or disprove – Barack Obama’s eligibility to be president.

Taitz told WND today she has mailed to U.S. Attorney General Eric Holder a request that he “relate Quo Warranto on Barack Hussein Obama II to test his title to president before the Supreme Court.”

The lengthy legal phrase essentially means an explanation is being demanded for what authority Obama is using to act as president. An online constitutional resource says Quo Warranto “affords the only judicial remedy for violations of the Constitution by public officials and agents.”

Requesting the action are Maj. Gen. Carroll Childers; Lt. Col. Dr. David Earl-Graef; police officer Clinton Grimes, formerly of the U.S. Navy; Lt. Scott Easterling, now serving on active duty in Iraq; New Hampshire State Rep. Timothy Comerford; Tennessee State Rep. Frank Nicely and others.  

“As president-elect, Respondent Obama failed to submit prima facie evidence of his qualifications before January 20, 2009. Election officers failed to challenge, validate or evaluate his qualifications. Relators submit that as president elect, Respondent Obama failed [tO] qualify per U.S. CONST. Amend. XX [paragraph] 3,” the document said.

John Eidsmoe, an expert on the U.S. Constitution now working with the Foundation on Moral Law, an organization founded by former Alabama Supreme Court Chief Justice Roy Moore after he was removed from office for formally recognizing the Ten Commandments’ influence in the U.S., said the demand is a legitimate course of action.

“She basically is asking, ‘By what authority’ is Obama president,” he told WND. “In other words, ‘I want you to tell me by what authority. I don’t really think you should hold the office.’

“She probably has some very good arguments to make,” Eidsmoe said.

The letter, dispatched to Holder today, is the latest development in the quest by a multitude of lawyers and plaintiffs nationwide for documentation that Obama qualifies to be president under the requirements of the U.S. Constitution.

WND has reported on dozens of legal challenges to Obama’s status as a “natural born citizen.” The Constitution, Article 2, Section 1, states, “No Person except a natural born Citizen, or a Citizen of the United States, at the time of the Adoption of this Constitution, shall be eligible to the Office of President.”

Some of the lawsuits question whether he was actually born in Hawaii, as he insists. If he was born out of the country, Obama’s American mother, the suits contend, was too young at the time of his birth to confer American citizenship to her son under the law at the time.

Other challenges have focused on Obama’s citizenship through his father, a Kenyan subject to the jurisdiction of the United Kingdom at the time of his birth, thus making him a dual citizen. The cases contend the framers of the Constitution excluded dual citizens from qualifying as natural born.

Where’s the proof Barack Obama was born in the U.S. or that he fulfills the “natural-born American” clause in the Constitution? If you still want to see it, join more than 300,000 others and sign up now!

Several of the cases have involved emergency appeals to the U.S. Supreme Court in which justices have declined even to hear arguments. Among the cases turned down without a hearing at the high court have been petitions by Philip Berg, Cort Wrotnowski, Leo Donofrio and Taitz.

Taitz’ plaintiffs, some of whom potentially face life-or-death situations in defense of the U.S. Constitution on a daily basis, note that information on Quo Warranto against a federal officer normally is related to the attorney general. But since Holder is an Obama friend and appointee, they are asking for the appointment of a special prosecutor to help in presenting documentation to the Supreme Court.

“This information on Quo Warranto includes action between the United States ex rel. and the State of Hawaii over original birth records of Barack H. Obama II being withheld per Hawaii’s privacy laws. Hawaii’s action obstructs the constitutional duties of election officers to validate or evaluate President Elect Obama qualifications to become President under U.S. CONST. art. II § 1, and amend. XX § 3,” the document said.

Eidsmoe said it’s clear that Obama has something in the documentation of his history, including his birth certificate, college records and other documents, “he does not want the public to know.

” What else could be the reason for his hiring law firms across the nation to fight any request for information as basic as his Occidental College records from the early 1980s, he asked. A separate lawsuit has sought the documents to find out whether they indicate Obama, possibly under the name Barry Soetero, attended the college on aid for foreign students.

Obama’s critics warn of the impending constitutional crisis should it be discovered Obama is ineligible and the resulting chaos of trying to figure out what, if any, of his executive branch orders, should be valid.

According to the online Constitution.org resource: “The common law writ of quo warranto has been suppressed at the federal level in the United States, and deprecated at the state level, but remains a right under the Ninth Amendment which was understood and presumed by the Founders, and which affords the only judicial remedy for violations of the Constitution by public officials and agents.”

Taitz told WND the “relators” include members of the Army, Air Force, Marines and Army and feature recipients of some of the highest honors the nation awards, including the Purple Heart.

One is Harry Riley, a veteran military officer who spent part of his career in the Pentagon. Riley said the issue is basically over whether Americans will allow “the trashing” of their Constitution.

“Myself, along with hundreds of thousands of other warriors, have fought for the U.S. Constitution. The whole issue is one of constitutional crisis, in my judgment. How can an individual become the commander-in-chief, or the president of the U.S., with questions regarding his constitutional qualifications?” he asked.

“The whole idea is that America cannot allow an individual to serve as president who isn’t qualified. It destroys our Constitution. It’s the bedrock of our nation,” he said.

“In the worst case, in the long run, if he continues [to fight revealing his documentation,] it’s going to be revolution in the streets,” he warned.

“It’s simply a matter of producing a $12 birth certificate,” Riley said.

“It’s just mindboggling to think an individual who’s been sworn in as the president of the United States would be so small and be such a hypocrite who would be unwilling to simply show a birth certificate,” Riley said.

Taitz told WND she has assembled a list of about 100 names of people – so far – who are willing to be plaintiffs in such a demand.

Childers told WND he’d be perfectly happy if Obama is legitimate, but the truth still matters.

“I personally admire many things about him,” he said. “But if he’s not legitimate, if he’s allowed to violate the Constitution, what else are they going to violate? Take my guns, and my television, telephone? What’s the limit?”

Taitz told WND she’s asking for the appointment of a special prosecutor, such as the role Archibald Cox played in investigating Watergate.

According to author Chester Antieau in his “The Practice of Extraordinary Remedies,” Quo Warranto is one of the oldest rights in common law.

“The earliest case on record appears in the 9th year of Richard I, 1198,” he wrote. “The statute of 9 Anne c. 20 in 1710 authorized a proper officer of a court, with leave of the court, to exhibit an information in the nature of quo warranto, at the ‘relation’ of any person desiring to prosecute the same – to be called the relator. Early American statutes were modeled after the Statute of Anne and, indeed, the statute has often been ruled to be part of the common law we inherited from England.”

Antieau noted the Pennsylvania Supreme Court has ruled, “Quo warranto is addressed to preventing a continued exercise of authority unlawfully asserted, rather than to correct what has already been done. …”

ts first recognize purpose, he said, is “to determine the title of persons claiming possession of public offices and to oust them if they are found to be usurpers.”

Among those who are subject to its demands, under court precedent, are chief executives in other U.S. governmental positions, including governors and sheriffs.

 As WND has reported on several occasions, none of the so-called “evidence” of Obama’s constitutional eligibility produced thus far is beyond reasonable doubt nor as iron-clad as simply producing an authentic birth certificate, something Americans are required to do regularly but the president still refuses to do.

As Jerome Corsi, WND senior staff writer, explained, “The main reason doubts persist regarding Obama’s birth certificate is this question: If an original Hawaii-doctor-generated and Hawaii-hospital-released Obama birth certificate exists, why wouldn’t the senator and his campaign simply order the document released and end the controversy?

“That Obama has not ordered Hawaii officials to release the document,” Corsi writes, “leaves doubts as to whether an authentic Hawaii birth certificate exists for Obama.”

Although Obama officials have told WND all such allegations are “garbage,” here is a partial listing and status update for some of the cases over Obama’s eligibility:

  • New Jersey attorney Mario Apuzzo has filed a case on behalf of Charles Kerchner and others alleging Congress didn’t properly ascertain that Obama is qualified to hold the office of president.
  • Pennsylvania Democrat Philip Berg has three cases pending, including Berg vs. Obama in the 3rd U.S. Circuit Court of Appeals, a separate Berg vs. Obama which is under seal at the U.S. District Court level and Hollister vs. Soetoro a/k/a Obama, brought on behalf of a retired military member who could be facing recall to active duty by Obama.
  • Leo Donofrio of New Jersey filed a lawsuit claiming Obama’s dual citizenship disqualified him from serving as president. His case was considered in conference by the U.S. Supreme Court but denied a full hearing.
  • Cort Wrotnowski filed suit against Connecticut’s secretary of state, making a similar argument to Donofrio. His case was considered in conference by the U.S. Supreme Court, but was denied a full hearing.
  • Former presidential candidate Alan Keyes headlines a list of people filing a suit in California, in a case handled by the United States Justice Foundation, that asks the secretary of state to refuse to allow the state’s 55 Electoral College votes to be cast in the 2008 presidential election until Obama verifies his eligibility to hold the office. The case is pending, and lawyers are seeking the public’s support.
  • Chicago Attorney Andy Martin sought legal action requiring Hawaii Gov. Linda Lingle to release Obama’s vital statistics record. The case was dismissed by Hawaii Circuit Court Judge Bert Ayabe.
  • Lt. Col. Donald Sullivan sought a temporary restraining order to stop the Electoral College vote in North Carolina until Barack Obama’s eligibility could be confirmed, alleging doubt about Obama’s citizenship. His case was denied.
  • In Ohio, David M. Neal sued to force the secretary of state to request documents from the Federal Elections Commission, the Democratic National Committee, the Ohio Democratic Party and Obama to show the presidential candidate was born in Hawaii. The case was denied.
  • Also in Ohio, there was the Greenberg v. Brunner case which ended when the judge threatened to assess all case costs against the plaintiff.
  • In Washington state, Steven Marquis sued the secretary of state seeking a determination on Obama’s citizenship. The case was denied.
  • In Georgia, Rev. Tom Terry asked the state Supreme Court to authenticate Obama’s birth certificate. His request for an injunction against Georgia’s secretary of state was denied by Georgia Superior Court Judge Jerry W. Baxter.
  • California attorney Orly Taitz has brought a case, Lightfoot vs. Bowen, on behalf of Gail Lightfoot, the vice presidential candidate on the ballot with Ron Paul, four electors and two registered voters.

In addition, other cases cited on the RightSideofLife blog as raising questions about Obama’s eligibility include:

  • In Texas, Darrel Hunter vs. Obama later was dismissed.
  • In Ohio, Gordon Stamper vs. U.S. later was dismissed.
  • In Texas, Brockhausen vs. Andrade.
  • In Washington, L. Charles Cohen vs. Obama.
  • In Hawaii, Keyes vs. Lingle, dismissed.

Corsi had gone to both Kenya and Hawaii prior to the election to investigate issues surrounding Obama’s birth. But his research and discoveries only raised more questions, the biggest being why, if there exists documentation of Obama’s eligibility, hasn’t it been released to quell the rumors.

Instead, a series of law firms have been hired on Obama’s behalf around the nation to prevent any public access to his birth certificate, passport records, college records and other documents.

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My Note: Mr. Obama, “Why Can’t You Just Provide Us With Your Birth Certificate?” – jschulmansr

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Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

 

 

 

 
 
 
 

 

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It’s Not Over Yet!- Obama Where Is Your Birth Certificate?

02 Monday Mar 2009

Posted by jschulmansr in 2008 Election, Bailout News, banking crisis, banks, Barack Obama, China, communism, Conservative, Conservative Resistance, Contrarian, depression, Economic Recovery, economic trends, economy, Electoral College, financial, follow the news, Free Speech, Fundamental Analysis, gold, Gold Bullion, Gold Investments, id theft, Joe Biden, Jschulmansr, Latest News, manipulation, market crash, Markets, physical gold, precious metals, Presidential Election, price, price manipulation, Saudi Arabia, silver, socialism, stagflation, Stimulus, The Fed, Today, U.S., u.s. constitution, U.S. Dollar

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It’s not over yet. Obama where is your birth certificate. I mostly blog about Precious Metals Investing, yet even I have some questions for Mr. Obama. No, while I am a conservative I am not a “radical fringe looney conservative” or even a “sore” loser. I have some legitimate concerns. First we have a new President who has never established eligibility to hold his office, this same man is now embarking on the largest spending spree this country has ever seen!

This is supposed to rescue our economy and set things straight with the American Economy. I have several concerns over this such as how now  Obama is ignoring the “earmarks” in the latest bill, this after a campaign promise “no more earmarks”. Next the way we are going to finance this is thru higher taxes, less tax breaks, and a whole lot more debt which America can sorely afford. Are we not selling off our future to the Chinese and Middle Eastern buyers of our governmental debt? I could go a lot more into these economic matters which we have all heard “ad nauseum” over how bad this is for us and especially for the future generations coming up behind us. One fact remains it is under the direction and orders of Mr. Obama.

My next real concern is the fact that almost unannounced and certainly without the press fanfare or opposition, even the vilification the Mr. Bush for his war in Iraq, notably from even Mr. Obama himself! Mr. Obama is sending even more troops into Afghanistan. Oh I forgot, he is going to announce the timetable of withdrawal from Iraq, so at least we will only be fighting on one front; but is this “withdrawal” actually going to turn into a reassignment for the American troops. Also, these troops will be even more cut off from lines of supply than in Iraq. So realistically how much more will this war cost us? Also, do we even have a plan on how we are going to win? Are we going to take over part of Pakistan too? Don’t get me wrong, I want to see Bin Laden and Al Queda destroyed, but all of this is happening under the command of the Commander in Chief, our President Mr. Obama who has yet to even prove eligibility by providing his Birth Certificate. What is up with That?

I f I have to show my Birth Certificate, I gladly do so, not to mention I am legally bound to do so. Why isn’t our president required as the leader and example of our country. If you or I do not show our Birth Certificates when asked face heavy potential liabilities and punishments. How does Mr. Obama get away with this?

FInally, as a Pecious metals analyst, this is great for the long term prospects of Gold and for my investments. Yet I would rather lose all or have losses with my investments than have my country destroyed by a man who can’t even prove he is a bona fide U.S. citizen!

I will have an update later today on Precious metals, if fact Gold retested support early today and then came back to close about $2.50 down to $940 (April Contact). Below in todays articles: It’s not over yet! Good Investing! -jschulmansr

Here is where I buy my Bullion, get one free gram of Gold just for opening an account! Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

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============================================== 

 The Birther’s Obama Conspiracy Theory – AOL News

Source: AOL NEWS

‘The Birthers’ Continue to Hound Obama

AOL
posted: 14 HOURS 18 MINUTES AGO
comments: 11534
filed under: Political News, The Obama Presidency
(March 1) – Ever since Barack Obama became a prominent political fixture in the country, he has encountered a large number of rumors and smears concerning him and his family.
There was the one rumor about him being a secret Muslim (he is a practicing Christian). And there was the one allegation his wife, Michelle, was caught on videotape using the word “whitey” (no such clip has ever surfaced).
Most of the charges were, for the most part, put to rest by vigorous responses from the Obama team during the campaign.
But one conspiracy theory lives on — despite overwhelming evidence debunking it.
Politico.com reports that the Birthers — a persistent group of conservatives who believe Obama is ineligible to be president because of alleged questions surrounding his birth status — continue to operate and thrive on the fringe.
“Some individuals and groups who are opposed to Obama’s presidency want an ‘acceptable’ reason to cite to convince other individuals and groups who might be on the fence to join in their way of thinking,” said Patricia Turner, who studies rumors at the University of California, Davis.
For the record, officials in Hawaii declared last October that there was no doubt Obama was born in the state. Officials verified that the health department holds the commander in chief’s original birth certificate.
But others are still undeterred.
A lawsuit filed in California by a group called the United States Justice Foundation seeks records from Occidental College, where Obama attended school for a period, in order to verify his nationality — and thus his presidential eligibility, WorldNetDaily reports.
Get the full story about the Birthers at Politico.com to find out about the group’s possible impact on the White House and weigh in, below, on the controversy.
Go to this site to add your vote in the polls about Obama’s Eligibility
==============================
Obama Eligiblility tops AOL NEWS – World Net Dailey

By Drew Zahn
© 2009 WorldNetDaily

 

Internet giant America Online headlined its daily news coverage today with a story and polls covering the “Birthers,” a group of people it describes as “fringe conservatives convinced that Barack Obama is ineligible to be president because of supposed questions surrounding his birth status.” 

 

The AOL coverage quotes an extensive Politico article and cites WorldNetDaily as the source for news on the United States Justice Foundation’s most recent attempt to demand Obama give legal evidence of his constitutional eligibility to serve as president.
 

Politico’s coverage of the questions that still linger over Obama’s birth, however, is far from kind. 

 

 

“Viewed as irrelevant by the White House , and as embarrassing by much of the Republican Party,” writes Politico blogger Ben Smith, “the subculture still thrives from the conservative website WorldNetDaily, which claims that some 300,000 people have signed a petition demanding more information on Obama’s birth.” 

 

Smith then states unequivocally that there is no basis for questioning Obama’s eligibility, that Obama “was in fact born in Honolulu in 1961” and that “long-settled law” resolves his dual citizenship at birth, another fount of legal questions surrounding the sitting president’s eligibility to serve in the Oval Office. Smith cites Hawaii officials who have testified that there do exist records – though unreleased to the public or the courts – verifying Obama’s American birth.

To add fuel to his argument, Smith then quotes from several sources, including radio host Michael Medved, to compile a list of descriptions for those he brands as conspiracy theorists, including the following: embarrassing, destructive, crazy, nutburger, demagogue, money-hungry, exploitative, irresponsible, filthy conservative imposters, the worst enemy of the conservative movement, weird, demented, sick, troubled and not suitable for civilized company.

Politico quotes David Emery, an urban legends writer for About.com, who suggests those that want to see proof of Obama’s eligibility are fueled by revulsion and rage.

“Thanks to the relentless agitation of the conspiracy theorists and the sheer quantity of hypothetical scenarios and legal arguments floating around,” Emery states, “they’ve clearly succeeded in planting unreasonable doubts in reasonable people’s minds.”

As WND has reported on several occasions, however, none of the so-called “evidence” of Obama’s constitutional eligibility produced thus far is beyond reasonable doubt nor as iron-clad as simply producing an authentic birth certificate, something everyday Americans are required to do regularly, but the president still refuses to do.

As Jerome Corsi, WND senior staff writer, explained, “The main reason doubts persist regarding Obama’s birth certificate is this question: If an original Hawaii-doctor-generated and Hawaii-hospital-released Obama birth certificate exists, why wouldn’t the senator and his campaign simply order the document released and end the controversy?

“That Obama has not ordered Hawaii officials to release the document,” Corsi writes, “leaves doubts as to whether an authentic Hawaii birth certificate exists for Obama.”

In its poll, AOL is asking readers: “Do you have any doubt about Obama’s eligibility to be president because of his birth status?”

With more than 250,000 responses, results were nearly split with 47 percent saying yes, and 53 percent saying no.

Readers were also asked, “How damaging is this conspiracy theory to Obama?”

With more than 178,00 responses, 52 percent said “Not at all,” 28 percent said “Somewhat,” and 20 percent said “Very.”

WND has reported on dozens of legal challenges to Obama’s status as a “natural born citizen.” The Constitution, Article 2, Section 1, states, “No Person except a natural born Citizen, or a Citizen of the United States, at the time of the Adoption of this Constitution, shall be eligible to the Office of President.”

Some of the lawsuits question whether he was actually born in Hawaii, as he insists. If he was born out of the country, Obama’s American mother, the suits contend, was too young at the time of his birth to confer American citizenship to her son under the law at the time.

Other challenges have focused on Obama’s citizenship through his father, a Kenyan subject to the jurisdiction of the United Kingdom at the time of his birth, thus making him a dual citizen. The cases contend the framers of the Constitution excluded dual citizens from qualifying as natural born.

Where’s the proof Barack Obama was born in the U.S. or that he fulfills the “natural-born American” clause in the Constitution? If you still want to see it, join more than 300,000 others and sign up now!

Several of the cases have involved emergency appeals to the U.S. Supreme Court in which justices have declined even to hear arguments. Among the cases turned down without a hearing at the high court have been petitions by Philip Berg, Cort Wrotnowski, Leo Donofrio and Orly Taitz.

The USJF case mentioned in the AOL article was filed on behalf of presidential candidate Ambassador Alan Keyes and others.

As part of the case, a subpoena was served on Occidental College for its records. School officials immediately contacted lawyers for Obama and said the demand would have to be answered unless they intervened.

Obama’s lawyers then submitted a demand to the court arguing the case was moot because the election was over and the correct place to resolve such concerns was in Congress. The lawyers also alleged a variety of procedural errors.

In his response, Kreep pointed out that Obama’s lawyers failed for 27 days to notify the USJF of alleged procedural errors. He said the housing and academic records are of prime importance.

“From those records, statements as to whether MR. OBAMA is, indeed, a ‘natural born citizen’ may be found,” he said.

At the end of February, at least two active-duty soldiers serving in Iraq as well as a retired major general offered to be plaintiffs in a lawsuit challenging Obama’s eligibility.

WND reported earlier when 1st Lt. Scott Easterling confirmed to Orly Taitz that he wanted to be a plaintiff in the legal action she is preparing on behalf of members of the U.S. military, both active and retired. A second soldier who asked that his name be withheld for now became part of the action a day later.

Then retired Maj. Gen. Carroll D. Childers submitted a statement to Taitz and her DefendOurFreedoms.us website, agreeing to be a plaintiff in her pending action.

Taitz explained the issue isn’t resolved as many Obama supporters claim.

The “Certification of Live Birth” posted on the Internet actually doesn’t confirm a birth location, she said.

“[Hawaii] statute 138 allows foreign born children of HI residents to get HI [Certificates of Live Birth] and get them based on a statement of one relative only,” she said.

She also said Hawaiian officials, while they confirmed a birth certificate exists, did not exclude the possibility it was “one obtained for a foreign born child.”

She also cited Obama’s immigration to Indonesia at age 5, when he was considered an Indonesian citizen.

Although Obama officials have told WND all such allegations are “garbage,” here is a partial listing and status update for some of the cases over Obama’s eligibility:

  • New Jersey attorney Mario Apuzzo has filed a case on behalf of Charles Kerchner and others alleging Congress didn’t properly ascertain that Obama is qualified to hold the office of president.
  • Pennsylvania Democrat Philip Berg has three cases pending, including Berg vs. Obama in the 3rd U.S. Circuit Court of Appeals, a separate Berg vs. Obama which is under seal at the U.S. District Court level and Hollister vs. Soetoro a/k/a Obama, brought on behalf of a retired military member who could be facing recall to active duty by Obama.
  • Leo Donofrio of New Jersey filed a lawsuit claiming Obama’s dual citizenship disqualified him from serving as president. His case was considered in conference by the U.S. Supreme Court but denied a full hearing.
  • Cort Wrotnowski filed suit against Connecticut’s secretary of state, making a similar argument to Donofrio. His case was considered in conference by the U.S. Supreme Court, but was denied a full hearing.
  • Former presidential candidate Alan Keyes headlines a list of people filing a suit in California, in a case handled by the United States Justice Foundation, that asks the secretary of state to refuse to allow the state’s 55 Electoral College votes to be cast in the 2008 presidential election until Obama verifies his eligibility to hold the office. The case is pending, and lawyers are seeking the public’s support.
  • Chicago attorney Andy Martin sought legal action requiring Hawaii Gov. Linda Lingle to release Obama’s vital statistics record. The case was dismissed by Hawaii Circuit Court Judge Bert Ayabe.
  • Lt. Col. Donald Sullivan sought a temporary restraining order to stop the Electoral College vote in North Carolina until Barack Obama’s eligibility could be confirmed, alleging doubt about Obama’s citizenship. His case was denied.
  • In Ohio, David M. Neal sued to force the secretary of state to request documents from the Federal Elections Commission, the Democratic National Committee, the Ohio Democratic Party and Obama to show the presidential candidate was born in Hawaii. The case was denied.
  • In Washington state, Steven Marquis sued the secretary of state seeking a determination on Obama’s citizenship. The case was denied.
  • In Georgia, Rev. Tom Terry asked the state Supreme Court to authenticate Obama’s birth certificate. His request for an injunction against Georgia’s secretary of state was denied by Georgia Superior Court Judge Jerry W. Baxter.
  • California attorney Orly Taitz has brought a case, Lightfoot vs. Bowen, on behalf of Gail Lightfoot, the vice presidential candidate on the ballot with Ron Paul, four electors and two registered voters.

In addition, other cases cited on the RightSideofLife blog as raising questions about Obama’s eligibility include:

  • In Texas, Darrel Hunter vs. Obama later was dismissed.
  • In Ohio, Gordon Stamper vs. U.S. later was dismissed.
  • In Texas, Brockhausen vs. Andrade.
  • In Washington, L. Charles Cohen vs. Obama.
  • In Hawaii, Keyes vs. Lingle, dismissed.

WND senior reporter Jerome Corsi had gone to both Kenya and Hawaii prior to the election to investigate issues surrounding Obama’s birth. But his research and discoveries only raised more questions, the biggest being why, if there exists documentation of Obama’s eligibility, hasn’t it been released to quell the rumors.

Instead, a series of law firms have been hired on Obama’s behalf around the nation to prevent any public access to his birth certificate, passport records, college records and other documents.

If you’d like to sound off on this issue, please take part in the WorldNetDaily poll.

Sign the petition

==============================

Watch for Post later today after Markets are closed- My One Question is simply Mr. Obama why won’t you show us your Birth Certificate?- Good Investing! – jschulmansrHere is where I buy my Bullion, get one free gram of Gold just for opening an account! Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

Follow Me on Twitter and be notified whenever I make a new post!

==================================

Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

 

 

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A Challenge! What is Gold going To Do?

27 Friday Feb 2009

Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, Bailout News, banking crisis, banks, Barack Obama, Brad Zigler, bull market, capitalism, China, Comex, commodities, Contrarian, Copper, Credit Default, Currencies, currency, Currency and Currencies, depression, DGP, DGZ, economic, Economic Recovery, economic trends, economy, Fed Fund Rate, Federal Deficit, federal reserve, Finance, financial, Forex, Fundamental Analysis, futures, futures markets, gata, GDX, GLD, gold, Gold Bubble, Gold Bullion, Gold Investments, gold miners, Gold Price Manipulation, hard assets, How To Invest, How To Make Money, hyper-inflation, IAU, IMF, India, inflation, Investing, investments, Junior Gold Miners, Latest News, majors, Make Money Investing, manipulation, Market Bubble, market crash, Markets, mid-tier, mining companies, mining stocks, monetization, oil, palladium, physical gold, platinum, platinum miners, precious, precious metals, price, price manipulation, prices, producers, production, recession, risk, run on banks, silver, silver miners, Silver Price Manipulation, small caps, spot, spot price, stagflation, Stimulus, Stocks, TARP, Technical Analysis, The Fed, Tier 1, Tier 2, Tier 3, Today, U.S., U.S. Dollar, warrants, XAU

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ANV, Austrian school, AUY, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, CDE, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, DGP, DGZ, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, EGO, Federal Deficit, financial, Forex, FRG, futures, futures markets, gata, GDX, GG, GLD, gold, gold miners, hard assets, HL, hyper-inflation, IAU, India, inflation, investments, Jeffrey Nichols, Jim Rogers, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, NGC, NXG, PAL, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, SLW, small caps, sovereign, spot, spot price, stagflation, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

This morning  I posted a challenge to Brad Zigler of Hard Assets Investor, I asked him point blank, “Pontificating aside, where do you stand in relation to Gold? Both short term and long term? No charts or arguments just a simple statement I believe Gold will…”. This was in relation to the 1st article below and comments (included); our answers back and forth (highlighted).

Today Gold is trading currently up $4.40 at $947 (April Contract). It has been as high as $17 up and as low as $946 currently trading at the lower end. We have strong support at the $930 level and if we close above $950 today then I believe next week we’ll see a return to test the $1000 level again.

The 2nd article is from GATA and government intervention/supression of Gold prices. Read my comment after Brad’s article for my short to long term call for Gold. I am getting ready to re-enter my DGP trade again and will be watching the market closely. If we do break resistance here then I will actually go short (buy DGZ) on the Gold market for a very short term trade as I think (if the resistance is broken) then we will go back and test support at $925 and then $880-$890 level. If we close above the $955 level then I will go long for the test of the $1000 level then the next test at $1033 all time high.

Disclosure: I am long in a couple of Precious Metals Mutual Funds, long Gold and Silver Bullion, and many of the Tier 1, 2, and junior mining stocks. Otherwise,as you can see I use DGP or DGZ for the short term moves in gold. 

Follow Me on Twitter and be notified whenever I make a new post!

 

Here is where I buy my Bullion, get one free gram of Gold just for opening an account! Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.comNow the article by Brad…

 

 

 

===================================

 

Gold’s Devilish Advocate – Seeking Alpha

By: Brad Zigler of Hard Assets Investor.com

In certain circles I’m known as a curmudgeon. Yeah, that’s right. Crusty, irascible and cantankerous. Hard to believe, isn’t it?
The funny thing is that people on both sides of the hard assets spectrum share that point of view. To so-called gold bugs, my under-exuberance for wildly optimist gold forecasts is anathema. Monetarists, on the other hand, grouse about my metering of the dollar’s value against bullion.
No matter what side you line up on, you can’t have ignored the $300 rally in gold prices since late October. For the February COMEX contract, that amounts to a 46% increase; pretty much a replay of the run-up that ended last March. That should prompt you to wonder about the odds of gold topping out again.
No doubt, the answer to that depends upon your gold Weltanschauung. But let’s play devil’s advocate for the moment. What factors argue for a gold sell-off? Or, at least, for keeping a lid on the metal’s ascendance?
The Dollar/Gold Dyad
This year, the dollar’s provided as much refuge for worried investors as gold. Ordinarily, there’s an inverse relationship between gold and the dollar. In the current global disinflationary environment, though, the greenback is proving to be the best nonmetallic haven for global capital. Rising dollar interest rates will enhance the buck’s attractiveness. At least until a cyclical reflation of the currency. Yes, there will be a lot of dollars out there. But right now, there are a lot of representations of the dollar-bills, notes and bonds-awaiting redemption.
The dollar’s prior inflationary pace was braked well before the price of gold peaked last March. We’ve yet to see the leading edge of reflation.

U.S. Monetary Inflation And Gold

U.S. Monetary Inflation And Gold

Dollar interest rates bottomed just before the Obama inauguration and have steadily gained ground since then. Rising rates are like lipstick: A judicious dose can enhance the beauty of a currency; too much, and it looks tawdry. There’s nothing tawdry, though, about the 18-point rise in the dollar LIBOR over the last month. It’s sustainable and makes the buck even more attractive.

Dollar Interest And Gold Lease Rates

Dollar Interest And Gold Lease Rates

Gold Liquidity

The gold lease market belies the shortage scenario played up by many market pundits. Gold lease rates have been falling precipitously as the contango reflected in forward rates has been rising. Contango exists when supplies are plentiful. The current oil market provides testimony of that. The gold market – at least the commercial gold market – gives every indication of being well-supplied.

Overbought Market

Relative strength in gold futures crossed into overbought territory when the spot contract topped $1,000 last week. The peak, if not exceeded, would represent an interim double top and confirmation that the March 2008 high is likely to hold.

COMEX Futures Open Interest

COMEX Futures Open Interest

Speculative Aggressiveness

Commercial hedgers are still driving gold futures pricing. Aggressiveness on the part of large speculative buyers has actually waned as prices moved higher. Over the past month, net long speculative positions rose 34% while commercial net shorts picked up 40%.

Essential Question

Think back to the events surrounding gold’s March 2008 peak and ask yourself this: “Have economic conditions improved or worsened since then?” I think it’s fair to say our financial troubles have deepened. If that’s true, and if gold is a safe haven, why hasn’t the metal made new highs?

This is by no means an exhaustive analysis, but it does raise essential questions that gold bulls should be prepared to address when making their case for higher prices.

Don’t expect to hear the answers in the late-night infomercials hawking gold, though.

================================

Comments:

 

 JudeJin

 

 

 

    • Comments
    • one cannot decipher a puzzle without having all the pieces.i think you lack a lot of other data to put together a whole picture of where gold stands.there are quite a few people in the world who have collected the all pieces of the puzzle and deciphered the truth behind gold! you are obviously not one of them.i think either you purposely hand-pick the set of charts with very limited time frame to drive your point home or ……    

       

       

    Feb 27 06:10 AM
     
    • Brad Zigler
    • 60 Comments
    • Website
    Look at the article’s premise: to play devil’s advocate against a widely held bullish sentiment.
    Feb 27 07:13 AM |Report abuse| Link | Reply
    +30

    You’re offering a complaint, not a refutation. What, specifically, is wrong with the arguments advanced?

    On Feb 27 06:10 AM JudeJin wrote:

    > one cannot decipher a puzzle without having all the pieces.
    >
    > i think you lack a lot of other data to put together a whole picture
    > of where gold stands.
    >
    > there are quite a few people in the world who have collected the
    > all pieces of the puzzle and deciphered the truth behind gold! you
    > are obviously not one of them.
    >
    > i think either you purposely hand-pick the set of charts with very
    > limited time frame to drive your point home or ……

  •  
    • doubleguns
    • 123 Comments
    JudeJin—– I would be interested (very interested) to hear all of the pieces if you would please. If you are one of those people please enlighten us.
  •  
    • huangjin
    • 310 Comments
    I would add the deflation/economic contraction argument. People have less money to spend and they will spend less on everything, including gold.
  •  
    • manya05
    • 11 Comments
    I do not have all the pieces of the puzzle, and I am no expert either, but a few things catch my eye and beg an explanation (or maybe they are the explanation). I see all fiat currencies devaluing, all at the same time more or less, and all for different reasons. For instance, the dollar and euro are devaluing as governments print money like there is no tomorrow, while the yuan and yen devalue to keep the economies from drowning as exports shut down. So everyone is sinking to the bottom. You would expect in that scenario that “something” would retain value. I see why gold bugs may think it is gold (finite amount in existence, finite production, and no use whatsoever other than financial instrument). And that is the clincher, why would something with no other use keep value? how about things that are useful and very much needed? shouldn’t those be appreciating? water, food, energy…why are they not? Sometimes I feel we are all watching the wrong movie and trying to interpret what is happening through the wrong lens…I think this is a systemic readjustment as the value/remuneration among nations in a globalized economy takes its course…but that is the subject for another post…..
  •  
    • craigdude
    • 6 Comments
    Brad- your article really opens my eyes- but I am not clear on a few things and I hope you will school me- you say at the Gold top a few days ago that there were signs the price would drop after the high- you said gold futures were in overbought territory- how did u know this and how do people know to sell at this high? I certainly want to learn how to sell my gold before it turns down? What do you mean the peak if not exceeded- double top etc? does it mean that gold will hold at this high? Please explain how a person can know gold will drop after reaching the $1000 price. Also I have noticed that gold has not dropped enough for me to buy back in if I sell at today’s price- I have to sell at $950 to be at least even and then I have to believe gold will go higher in order for me to buy back in. Where do you think gold will go in the next 6 months as Obama’s money plan reveals itself to be a failure-? If Jim Rogers thinks gold will continue higher because of fundamentals- what do you think of the fundamentals in a 1 or 2 year time frame?
  •  
    • craigdude
    • 6 Comments
    Brad- could gold be controlled by governments leasing gold and selling to keep lid on prices?–please explain double top and overbought
  •  
    • scotty1560
    • 155 Comments
    Brad.. listen gold has held up better than any commodity like oil or
    and any equity or real estate investment.

    It could drop.. I’m not that smart to predict.
    IMO the drop is after the economy recovers and that could take years at
    this point. It’s a safe haven and a trade against the dow.. I see the dow
    much lower.. so gold should at minimum hold it’s ground and perhaps
    rise towards 1500-2000, based on historical trends.
    In troubled times we humans tend to get religion and go back to
    ancient methods of survival.. gold fits that scenario.

    • Alex Filonov
    • 397 Comments
    • Website
    Couple more data points:

    1. NYMEX open interest for April exceeds open interest for all other months. ETF effect?

    2. India is not importing gold anymore. Regular buyer of 30% physical gold is out of the market.

  •  
    • jschulmansr
    • 7 Comments
    • Website
    Brad; Pontificating aside, where do you stand in relation to Gold? Both short term and long term? No charts or arguments just a simple statement I believe Gold will…

    Thanks!

    Jeff Schulman Sr aka jschulmansr

  •  
    • Brad Zigler
    • 60 Comments
    • Website
    No one, of course, “knows” gold will drop or rise from any particular price level. T

    here are, however, technical indicators such as the Relative Strength Index and stochastics which identify certain market levels as overbought or oversold.

    A double top is a price level reached a couple of times by a market as it attempts to rally higher but can’t be hurdled. The failure sets up a decline.

    About gold leases. Often, nefarious intente is ascribed to central bank swap activity. But leasing can be simply a way to garner a return on an otherwise sterile asset as well as a way to stimulate lending and investment activity.

    Outright borrows of bullion by bank customers tend to increase when bearish sentiments prevail. In essence, the borrower doesn’t want to face the prospect of buying back gold at a higher price to close out the loan.

    With that in mind, the market may already favor shorts BEFORE leasing.

    On Feb 27 09:25 AM craigdude wrote:

    > Brad- could gold be controlled by governments leasing gold and selling
    > to keep lid on prices?–please explain double top and overbought

  •  
    • jschulmansr
    • 7 Comments
    • Website
    Brad;
    Ps- I guess I should have added I think your articles are very well written and thought provoking. I make mention of and use your stuff on my blog quite often, but recently I have not heard your outlook for Gold. I do agree we are at a crossroads here, we may see more retracement. I think we are about to see Gold go and test it’s all time highs. Failure there I think will mean a retracement potentially as low to $880 to $890. If we clear due to manipulaton and where the short interest got in at there will be sttrong pressure to bring down prices at the $1050 level. If that hurdle is cleared I think that the banks who are short will give up and cause a very violent spike upwards “shortcovering rally”. After all they can afford to give in now as they figure they can get their money back thru Government stimulus, TARP, and bailout funds. Long term however, I do feel with inflation runnng a tad higher than what you are currently stating,and the fact that the monetary printing presses are running full steam round the clock; that longer term we will see inflation even hypr and/or stagfaltion. In other words get your wheelbarrow to haul your money around to go shopping for a “loaf” of bread. I truly think that prices of $2000 to $3500 oz are not unrealistic given the aforementioned scenario. What is your opinion in regards to this? Maybe even a special article?- Thanks Again- Jeff Schulman Sr aka jschulmansr
    Feb 27 11:29 AM |Report abuse| Link | Reply
    +10
  •  
    • Brad Zigler
    • 60 Comments
    • Website
    Don’t read too much into the large open interest in April futures. There are certain delivery months for gold that are traditionally more active than others. April is one of them (February, June, August, October and December are the others).
    Feb 27 11:31 AM |Report abuse| Link | Reply
    +10

    As February’s expiry approached, open interest rolled to the next active month in the cycle–April. Yes, some of that is ETF interest (namely, DBG, the PowerShares DB Gold ETF). It doesn’t, however, include the SPDR Gold Shares (GLD) or the iShares COMEX Gold Trust (IAU). These trusts hold physical metal, not futures.

    On Feb 27 10:31 AM Alex Filonov wrote:

    > Couple more data points:
    >
    > 1. NYMEX open interest for April exceeds open interest for all other
    > months. ETF effect?
    >
    > 2. India is not importing gold anymore. Regular buyer of 30% physical
    > gold is out of the market.

  •  
    • TexasER
    • 21 Comments
    Speculating on the price of gold has always been risky, never more so than now. If you’re in this trade to turn a quick profit, you have more guts or brains than me.
    Feb 27 11:48 AM |Report abuse| Link | Reply
    +10

    But as “melt-down” insurance, gold has performed exactly as advertised. I see no indication that it will somehow stop acting this way. If the markets fall off another cliff, obviously gold will do well.

    Diversification has always been a prudent strategy. That hasn’t changed, but gold’s importance to a diversified portfolio has changed. Some investors have recognized this out of prudence, not panic, and acted accordingly.

    I’m long, but if gold goes to $500 from here, you won’t hear me whining about it.

  •  
    • jschulmansr
    • 7 Comments
    • Website
    Brad; Thanks for your answer, I am sure you are aware of GATA, that is really were one of my main concern lies. The continued manipulation of prices by both governmental and banks. It will be very interesting to see what the CFTC and Comex are going to do with their investigations in both the Silver and Gold markets. Also long term I think we have a couple of big plays coming up with Silver and Oil. That’s what I love about the markets, sheer boredom puncuated by moments of either sheer elation or sheer terror! Thanks again! – Jeff Schulman Sr aka jschulmansr
    Feb 27 12:03 PM |Report abuse| Link | Reply
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  • ========================================
    Now to “Market Price Manipulation…
    Ex-Treasury official Confirms Gold Suppression Scheme – Gata
    Source: Gold Anti-Trust Action Committee (Gata)
    Home » Daily Dispatches

    Ex-Treasury official confirms gold

    suppression scheme

    Submitted by cpowell on Tue, 2009-02-24 22:13. Section: Daily Dispatches

    5p ET Tuesday, February 24, 2009

    Dear Friend of GATA and Gold:

    In an essay published today at Counterpunch.org, former Assistant Treasury Secretary Paul Craig Roberts confirms that the U.S. government has been leasing gold to suppress its price and support the dollar. The admission is made in the last paragraph of the essay, which is appended.

    CHRIS POWELL, Secretary/Treasurer
    Gold Anti-Trust Action Committee Inc.

    * * *

    Doomed by the Myths of Free Trade: How the Economy Was Lost

    By Paul Craig Roberts
    Tuesday, February 24, 2009

    http://www.counterpunch.org/roberts02242009.html

    The American economy has gone away. It is not coming back until free trade myths are buried 6 feet under.

    America’s 20th century economic success was based on two things. Free trade was not one of them. America’s economic success was based on protectionism, which was ensured by the union victory in the Civil War, and on British indebtedness, which destroyed the British pound as world reserve currency. Following World War II, the US dollar took the role as reserve currency, a privilege that allows the US to pay its international bills in its own currency.

    World War II and socialism together ensured that the US economy dominated the world at the mid-20th century. The economies of the rest of the world had been destroyed by war or were stifled by socialism [in terms of the priorities of the capitalist growth model: Editors.]

    The ascendant position of the US economy caused the US government to be relaxed about giving away American industries, such as textiles, as bribes to other countries for cooperating with America’s cold war and foreign policies. For example, Turkey’s US textile quotas were increased in exchange for overflight rights in the Gulf War, making lost US textile jobs an off-budget war expense.

    In contrast, countries such as Japan and Germany used industrial policy to plot their comebacks. By the late 1970s, Japanese auto makers had the once dominant American auto industry on the ropes. The first economic act of the “free market” Reagan administration in 1981 was to put quotas on the import of Japanese cars in order to protect Detroit and the United Auto Workers.

    Eamonn Fingleton, Pat Choate, and others have described how negligence in Washington aided and abetted the erosion of America’s economic position. What we didn’t give away, the United States let be taken away while preaching a “free trade” doctrine at which the rest of the world scoffed.

    Fortunately, the U.S.’s adversaries at the time, the Soviet Union and China, had unworkable economic systems that posed no threat to America’s diminishing economic prowess.

    This furlough from reality ended when Soviet, Chinese, and Indian socialism surrendered around 1990, to be followed shortly thereafter by the rise of the high speed Internet. Suddenly American and other First World corporations discovered that a massive supply of foreign labor was available at practically free wages.

    To get Wall Street analysts and shareholder advocacy groups off their backs, and to boost shareholder returns and management bonuses, American corporations began moving their production for American markets offshore. Products that were made in Peoria are now made in China.

    As offshoring spread, American cities and states lost tax base, and families and communities lost jobs. The replacement jobs, such as selling the offshored products at Wal-Mart, brought home less pay.

    “Free market economists” covered up the damage done to the US economy by preaching a New Economy based on services and innovation. But it wasn’t long before corporations discovered that the high speed Internet let them offshore a wide range of professional service jobs. In America, the hardest hit have been software engineers and information technology (IT) workers.

    The American corporations quickly learned that by declaring “shortages” of skilled Americans, they could get from Congress H-1b work visas for lower paid foreigners with whom to replace their American work force. Many US corporations are known for forcing their US employees to train their foreign replacements in exchange for severance pay.

    Chasing after shareholder return and “performance bonuses,” US corporations deserted their American workforce. The consequences can be seen everywhere. The loss of tax base has threatened the municipal bonds of cities and states and reduced the wealth of individuals who purchased the bonds. The lost jobs with good pay resulted in the expansion of consumer debt in order to maintain consumption. As the offshored goods and services are brought back to America to sell, the US trade deficit has exploded to unimaginable heights, calling into question the US dollar as reserve currency and America’s ability to finance its trade deficit.

    As the American economy eroded away bit by bit, “free market” ideologues produced endless reassurances that America had pulled a fast one on China, sending China dirty and grimy manufacturing jobs. Free of these “old economy” jobs, Americans were lulled with promises of riches. In place of dirty fingernails, American efforts would flow into innovation and entrepreneurship. In the meantime, the “service economy” of software and communications would provide a leg up for the work force.

    Education was the answer to all challenges. This appeased the academics, and they produced no studies that would contradict the propaganda and, thus, curtail the flow of federal government and corporate grants.

    The “free market” economists, who provided the propaganda and disinformation to hide the act of destroying the US economy, were well paid. And as Business Week noted, “outsourcing’s inner circle has deep roots in GE (General Electric) and McKinsey,” a consulting firm. Indeed, one of McKinsey’s main apologists for offshoring of US jobs, Diana Farrell, is now a member of Obama’s White House National Economic Council.

    The pressure of jobs offshoring, together with vast imports, has destroyed the economic prospects for all Americans, except the CEOs who receive “performance” bonuses for moving American jobs offshore or giving them to H-1b work visa holders. Lowly paid offshored employees, together with H-1b visas, have curtailed employment for older and more experienced American workers. Older workers traditionally receive higher pay. However, when the determining factor is minimizing labor costs for the sake of shareholder returns and management bonuses, older workers are unaffordable. Doing a good job, providing a good service, is no longer the corporation’s function. Instead, the goal is to minimize labor costs at all cost.

    Thus “free trade” has also destroyed the employment prospects of older workers. Forced out of their careers, they seek employment as shelf stockers for Wal-Mart.

    I have read endless tributes to Wal-Mart from “libertarian economists,” who sing Wal-Mart’s praises for bringing low price goods, 70 per cent of which are made in China, to the American consumer. What these “economists” do not factor into their analysis is the diminution of American family incomes and government tax base from the loss of the goods producing jobs to China. Ladders of upward mobility are being dismantled by offshoring, while California issues IOUs to pay its bills. The shift of production offshore reduces US GDP. When the goods and services are brought back to America to be sold, they increase the trade deficit. As the trade deficit is financed by foreigners acquiring ownership of US assets, this means that profits, dividends, capital gains, interest, rents, and tolls leave American pockets for foreign ones.

    The demise of America’s productive economy left the US economy dependent on finance, in which the US remained dominant because the dollar is the reserve currency. With the departure of factories, finance went in new directions. Mortgages, which were once held in the portfolios of the issuer, were securitized. Individual mortgage debts were combined into a “security.” The next step was to strip out the interest payments to the mortgages and sell them as derivatives, thus creating a third debt instrument based on the original mortgages.

    In pursuit of ever more profits, financial institutions began betting on the success and failure of various debt instruments and by implication on firms. They bought and sold collateral debt swaps. A buyer pays a premium to a seller for a swap to guarantee an asset’s value. If an asset “insured” by a swap falls in value, the seller of the swap is supposed to make the owner of the swap whole. The purchaser of a swap is not required to own the asset in order to contract for a guarantee of its value. Therefore, as many people could purchase as many swaps as they wished on the same asset. Thus, the total value of the swaps greatly exceeds the value of the assets.* [See footnote.)

    The next step is for holders of the swaps to short the asset in order to drive down its value and collect the guarantee. As the issuers of swaps were not required to reserve against them, and as there is no limit to the number of swaps, the payouts could easily exceed the net worth of the issuer.

    This was the most shameful and most mindless form of speculation. Gamblers were betting hands that they could not cover. The US regulators fled their posts. The American financial institutions abandoned all integrity. As a consequence, American financial institutions and rating agencies are trusted nowhere on earth.

    The US government should never have used billions of taxpayers’ dollars to pay off swap bets as it did when it bailed out the insurance company AIG. This was a stunning waste of a vast sum of money. The federal government should declare all swap agreements to be fraudulent contracts, except for a single swap held by the owner of the asset. Simply wiping out these fraudulent contracts would remove the bulk of the vast overhang of “troubled” assets that threaten financial markets.

    The billions of taxpayers’ dollars spent buying up subprime derivatives were also wasted. The government did not need to spend one dime. All government needed to do was to suspend the mark-to-market rule. This simple act would have removed the solvency threat to financial institutions by allowing them to keep the derivatives at book value until financial institutions could ascertain their true values and write them down over time.

    Taxpayers, equity owners, and the credit standing of the US government are being ruined by financial shysters who are manipulating to their own advantage the government’s commitment to mark-to-market and to the “sanctity of contracts.” Multi-trillion dollar “bailouts” and bank nationalization are the result of the government’s inability to respond intelligently.

    Two more simple acts would have completed the rescue without costing the taxpayers one dollar: an announcement from the Federal Reserve that it will be lender of last resort to all depository institutions including money market funds, and an announcement reinstating the uptick rule.

    The uptick rule was suspended or repealed a couple of years ago in order to permit hedge funds and shyster speculators to ripoff American equity owners. The rule prevented short-selling any stock that did not move up in price during the previous day. In other words, speculators could not make money at others’ expense by ganging up on a stock and short-selling it day after day.

    As a former Treasury official, I am amazed that the US government, in the midst of the worst financial crises ever, is content for short-selling to drive down the asset prices that the government is trying to support. No bailout or stimulus plan has any hope until the uptick rule is reinstated.

    The bald fact is that the combination of ignorance, negligence, and ideology that permitted the crisis to happen still prevails and is blocking any remedy. Either the people in power in Washington and the financial community are total dimwits or they are manipulating an opportunity to redistribute wealth from taxpayers, equity owners and pension funds to the financial sector.

    The Bush and Obama plans total 1.6 trillion dollars, every one of which will have to be borrowed, and no one knows from where. This huge sum will compromise the value of the US dollar, its role as reserve currency, the ability of the US government to service its debt, and the price level. These staggering costs are pointless and are to no avail, as not one step has been taken that would alleviate the crisis.

    If we add to my simple menu of remedies a ban, punishable by instant death, for short selling any national currency, the world can be rescued from the current crisis without years of suffering, violent upheavals and, perhaps, wars.

    According to its hopeful but economically ignorant proponents, globalism was supposed to balance risks across national economies and to offset downturns in one part of the world with upturns in other parts. A global portfolio was a protection against loss, claimed globalism’s purveyors. In fact, globalism has concentrated the risks, resulting in Wall Street’s greed endangering all the economies of the world. The greed of Wall Street and the negligence of the US government have wrecked the prospects of many nations. Street riots are already occurring in parts of the world. On Sunday February 22, the right-wing TV station, Fox “News,” presented a program that predicted riots and disarray in the United States by 2014.

    How long will Americans permit “their” government to rip them off for the sake of the financial interests that caused the problem? Obama’s cabinet and National Economic Council are filled with representatives of the interest groups that caused the problem. The Obama administration is not a government capable of preventing a catastrophe.

    If truth be known, the “banking problem” is the least of our worries. Our economy faces two much more serious problems. One is that offshoring and H-1b visas have stopped the growth of family incomes, except, of course, for the super rich. To keep the economy going, consumers have gone deeper into debt, maxing out their credit cards and refinancing their homes and spending the equity. Consumers are now so indebted that they cannot increase their spending by taking on more debt. Thus, whether or not the banks resume lending is beside the point.

    The other serious problem is the status of the US dollar as reserve currency. This status has allowed the US, now a country heavily dependent on imports just like a third world or lesser-developed country, to pay its international bills in its own currency. We are able to import $800 billion annually more than we produce, because the foreign countries from whom we import are willing to accept paper for their goods and services.

    If the dollar loses its reserve currency role, foreigners will not accept dollars in exchange for real things. This event would be immensely disruptive to an economy dependent on imports for its energy, its clothes, its shoes, its manufactured products, and its advanced technology products.

    If incompetence in Washington, the type of incompetence that produced the current economic crisis, destroys the dollar as reserve currency, the “unipower” will overnight become a third world country, unable to pay for its imports or to sustain its standard of living.

    How long can the US government protect the dollar’s value by leasing its gold to bullion dealers who sell it, thereby holding down the gold price? Given the incompetence in Washington and on Wall Street, our best hope is that the rest of the world is even less competent and even in deeper trouble. In this event, the US dollar might survive as the least valueless of the world’s fiat currencies.

    *(An excellent explanation of swaps can be found here.)

    —–

    Paul Craig Roberts was assistant secretary of the treasury in the Reagan administration. He is coauthor of “The Tyranny of Good Intentions.” He can be reached at PaulCraigRoberts@yahoo.com.

    * * *

    Help keep GATA going

    GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at http://www.gata.org/.

    ====================================

    Have a Great Weekend! Keep your eyes open for a special weekend post. Good Investing! jschulmansr

    Follow Me on Twitter and be notified whenever I make a new post!

    Catch the New Bull! – Buy Gold Online – Get 1 gram free just for opening account– just click here and then again on the Gold Bar!, no minimums – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    ========================================

    Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor/s, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investing decisions and/or investments. –  jschulmansr

     

     

     

     

     

     

     

     

     

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    It’s Starting Again!

    17 Tuesday Feb 2009

    Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, banking crisis, banks, Barack Obama, bear market, bull market, capitalism, central banks, China, commodities, Contrarian, Copper, Credit Default, Currencies, currency, Currency and Currencies, DGP, dollar denominated, dollar denominated investments, economic, Economic Recovery, economic trends, Fed Fund Rate, Federal Deficit, federal reserve, Finance, financial, Forex, Fundamental Analysis, futures, futures markets, gata, GDX, GLD, gold, Gold Bullion, Gold Investments, gold miners, hard assets, How To Invest, How To Make Money, hyper-inflation, IAU, IMF, India, inflation, Investing, investments, Junior Gold Miners, Latest News, Long Bonds, Make Money Investing, market crash, Markets, mid-tier, mining companies, mining stocks, monetization, Moving Averages, palladium, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, rare earth metals, run on banks, silver, silver miners, sovereign, spot price, stagflation, Stimulus, Stocks, TARP, Technical Analysis, TIPS, Today, U.S., U.S. Dollar, XAU

    ≈ Comments Off on It’s Starting Again!

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    Austrian school, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, bull market, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, dollar denominated, dollar denominated investments, economic, economic trends, economy, Federal Deficit, financial, Forex, futures, futures markets, gata, GDX, GLD, gold, gold miners, hard assets, hyper-inflation, India, inflation, investments, Jim Rogers, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, mid-tier, mining companies, monetization, Moving Averages, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, small caps, sovereign, spot, spot price, stagflation, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

    It’s starting again, time to get aboard now, next stop $1000 to $1500! Gold cleared the $950 price mark today with a vengeance. During trading today Gold was up over $970 oz and closing at $967.50 up $25.30. Today’s main headline on MarketWatch was “Bears test November lows- Technical support levels in peril; Investors pile into Gold, Treasuries”. As I have mentioned in a recent post about Gold if we successfully clear and close above the $950 – $960 level the Gold will zoom up and have a retest of the all time highs! To answer my question I posted here… Gold has passed it’s first test with an A++. If you haven’t already invested in gold and precious metals you definitely need to do so now! Some of the following articles explain why… – Good Investing – jschulmansr

    ===========================

    Here is where I buy my bullion:

    Catch the New Bull! – Buy Gold Online –Get 1 Gram Free! Just for Opening and Account, No minimums, Buy Safely, quickly, and at low prices, guaranteed! Bullion Vault.com

    ================================

    Don’t Kick Yourself Later for Not Buying Gold and Silver Now – Seeking Alpha

    By: Peter Cooper of Arabian Money.net

    Gold is powering up towards $1,000 an ounce, and while the odd hesitation along the way is possible it will shortly cross this boundary, hit a new all-time high and then head upwards again.

    A trend is your friend, especially if you take advantage of it. For gold the question is how best to leverage the up trend.

    Gold and silver stocks are the answer. Conveniently precious metal stocks got really thrashed last autumn – along with gold and silver and every other asset class except bonds. So they are dirt cheap.

    Rising prices

    But will gold and silver equities not fall again if global stock markets tank, as they surely must with profit forecasts for the non-financials still ludicrously optimistic (face facts, for many major companies there will be losses and not profits in 2009)?

    No they will not if precious metal prices are rising – and not falling as they did last autumn. And why will gold and silver prices keep on rising this time?

    Well, investors are now very worried about bonds and currency rates, and that leaves gold and silver as the last safe haven in the investment universe. If there is only one investment class left to buy that ought to simplify things for investors.

    Rising profits

    Gold and silver producers are also big beneficiaries of falling energy prices this year, as up to a quarter of production costs go on energy. In addition, most mines are in non-dollar economies, so manufacturers have costs in depreciated currencies and income in the strong dollar.

    That means that even if precious metal prices stagnate – and that looks highly unlikely – gold and silver producers are among the only commodity producers that will see profits jump in 2009.

    My blog contains many articles on gold and silver which can point you towards some of the better, and riskier equity investments in this sector, and taking a risk in a rising market usually pays off handsomely.

    The people who will be kicking themselves later in the year will be those who do not buy gold and silver stocks now.

    This reminds me of my warning to those who did not buy Dubai property when they first had the chance, and even after a 50 per cent fall in house prices they are still 300 per cent up on their original investment!

    ========================

    My Note: If you have been following my Blog “Dare Something Worthy Today Too!”, for any length of time this is exactly what I have been saying – many gold and silver stocks with production are still selling at or near book values! -jschulmansr

    Catch the New Bull! – Buy Gold Online –Get 1 Gram Free! Just for Opening and Account, No minimums, Buy Safely, quickly, and at low prices, guaranteed! Bullion Vault.com

    ========================

    Gold Strikes Record Levels in Most Currencies – Seeking Alpha

    By: Toni Straka of The Prudent Investor

    With all equities markets deep in the red, MSM and bloggers have missed out on this easy scoop for several weeks: Gold currently strikes new all-time highs in most currencies. This sensational news, omitted in all those media that are normally quick to recommend this or that paper ‘asset’, which in the end is always only somebody else’s obligation, can be revealed at this blog exclusively, a Google news search shows. 😉

    Gold traded for more than €771 and GBP 682 for the first time in history. The strong rise in the price of gold to new historic records in most countries except the USA is a logical reaction to the credit and solvency crisis that engulfs the globe as investors, nervous about a total market fallout, flee all paper promises and seek a truly safe haven.

    Gold has never lost its value in more than 3,500 years, whereas no fiat currency survived longer than a human’s lifespan so far. Check out its resistance against inflation here.

    click to enlarge

    GRAPH: Gold priced in Euro has been on a tear since late November. It also outpaced all other asset classes. Chart courtesy of Stockcharts.com

    I have been recommending investments in gold and mining shares since 2005. Licking my wounds from last year’s biggest and longest decline in this equity sector in 80 years, I will at least have a story to tell to my grandchildren.

    But the fundamental outlook has only worsened in the past 4 years. Having correctly called for a sharp economic downturn in the USA since 2005, I nevertheless failed to recognize the dramatic situation in the Eurozone and the recent hard landing of China. This worsening global situation only underscores the value of holding the only asset that is not someone else’s obligation. The Euro is as doomed as are Federal Reserve Notes and nobody outside the UK cares about Sterling anymore.

    We are about to witness the era of busted major fiat currencies that will go out the same way as did all unbacked fiat curencies in the past 1,000 years.

    The Chinese tried it in the 11th century and it ended in a revolt. The same happened in France in the 18th century where it gave birth to the Republic. The decline of the Austro-Hungarian empire in WWI came on the heels of hyper-inflation and Germany’s fate could have taken another turn in the 1920s, if it were not for the hyper-inflation that paved the way for Adolf Hitler.

    Unfortunately, we could very well end up as happened in past crises, with everyone a millionaire beggar.

    ========================

    Bullish Long Term Outlook for Gold – Seeking Alpha

    By: Peter Degraaf of pdegraaf.com

    The long-term outlook for gold is very bullish, for to paraphrase Sir Winston Churchill’s famous remark, “never before in history have so many dollars chased so few ounces of gold (and silver)”.* The mountains of currency are rising, while the number of ounces of gold produced by gold mines is dropping.

    The passing of the Stimulus Bill, referred to by some as the Porkulus Bill, will add billions of dollars to an already ballooning deficit. Instead of allowing the excesses in the credit markets to work themselves out by letting healthy institutions prosper, while allowing unhealthy institutions to fail, the new administration, aided by Congress, is throwing gasoline at the fire by rewarding shoddy business practices. People like Barney Frank and Christopher Dodd, who strong-armed the banking industry to make questionable mortgage loans, are now helping to shape the decisions that will prolong the problems. The foxes are still in the henhouse.

    In the 1960’s it was James U. Blanchard III who pointed to the growing US deficits as the trigger that would cause gold prices to rise. In those days the deficits were still counted in millions of dollars. One wonders what Jim would say about deficits that are now counted in trillions of dollars. His advice would surely be: “Buy Gold”.

    It was my pleasure to meet Jim Blanchard at one of his hard money conferences in New Orleans. Jim founded the National Committee to legalize the ownership of gold in the USA. In 1973, during the inauguration of President Nixon, Jim hired a small plane that flew near the inauguration site towing a banner that read: “Legalize Gold”.

    Jim did everything with style and ingenuity. During one of his conferences he needed to move about one thousand of us from the convention hotel to a nearby convention center. He hired a marching band, and while police controlled several intersections the marching band led us to the center.

    Let’s now look at some charts.

    Featured is the chart (courtesy www.stockcharts.com that compares the price of gold to the XAU index (top), and compares this picture to the HUI index (bottom). The blue vertical lines draw your attention to a ‘link’ when the Gold/XAU rises above 5 and the HUI index begins a multi-month rise from a bottom. The red vertical line points to the only exception to this trend, since 2002. In that last seven years this early warning signal has worked 7 out of 8 times.

    The last link is the ‘mother of all signals’, as the index rose to a record high of 11.5, while the Huey put in a four year bottom.

    According to research done by John Hussman, in the past, when the gold/XAU ratio reached a point above 5, while the ISM purchasing managers index registers a reading below 50 (indicating the US manufacturing sector is decreasing), gold shares advanced at an annual rate of 125%. The current reading for the PMI is 35.6%, while the gold/XAU is at 7.2.

    Featured is the ‘real interest rate’ chart, as reported by the Federal Reserve Bank of St. Louis. The bank shows the real rate at zero percent, having risen up from -3%. If we use the figures supplied by John Williams (see next chart), we arrive at a negative ‘real interest rate’ of -3.5%. Unless and until real rates turn positive by at least 2%, and for at least 6 months, we can depend on gold continuing its bull market rise.

    This chart courtesy www.shadowstats.com compares the official CPI rate in orange to the John Williams interpretation in blue. With the Williams CPI-U at 3.5% and short-term bills at 0% interest, the ‘real interest rates’ are negative by 3.5%.

    Featured is a chart (courtesy www.stockcharts.com) that compares the HUI index to the US dollar for the year 2005. For those who feel that gold stocks cannot rise unless the US dollar falls, this chart tells us that both gold stocks and the US dollar ended the year higher than at the start of the year.

    As long as other currencies, such as the Euro, Yen, Pound and Canadian dollar are having problems of their own (caused by monetary inflation), the US dollar does not need fall, and gold and gold stocks can still rise.

    Featured is the weekly gold chart (courtesy www.stockcharts.com). The blue arrows point to bottoms in the 7 – 8 week gold cycle. The last 3 cycles were short, thus the expectation is that we are due for a longer one, perhaps 9 or 10 weeks. The black arrow points to the upside breakout that occurred last week. This breakout came from beneath resistance that went back all the way to March 2008 AD. The green arrow points to the target for this breakout. The supporting indicators (RSI & MACD) are positive, with room on the upside.

    The Gold Direction Indicator moved up from a reading of + 20% on Feb. 9th, when gold bullion was 895.00, to the current reading of +60% with gold bullion at 941.00.

    Featured is the weekly silver chart (courtesy www.stockcharts.com) . Price has risen four weeks in a row and is expected to meet resistance at the purple arrow. Once this resistance is overcome, the target is at the green arrow. The supporting indicators, (RSI & MACD), are positive with room to rise.

    Featured is the price progression for silver during the past five years (annual average – data supplied by the Silver Institute).

    Summary: Last week’s breakout by the gold price confirms that the Christmas rally that started in November is ongoing. In the short-term we can expect a lot of volatility, as commercial traders and bullion banks that are ‘short’ gold will do their utmost to suppress the price. They will do this by testing the current breakout. They will use the threat of ‘asset deflation’ (which has nothing to do with the effects of monetary inflation, which always leads to price inflation), and they will use the threat of IMF gold sales to try to cap the gold price rallies.

    In the longer term the huge increases in currency (both paper and digital), on a worldwide basis, tell us that the gold bull still has a lot of running room left.

    *(“Never in the field of human conflict was so much owed by so many to so few” – Sir Winston Churchill referring to the Battle of Britain).

    DISCLAIMER: Please do your own due diligence. I am NOT responsible for your trading decisions.- P. Degraaf

    ========================

    Catch the New Bull! – Buy Gold Online –Get 1 Gram Free! Just for Opening and Account, No minimums, Buy Safely, quickly, and at low prices, guaranteed! Bullion Vault.com

    ===============================

    Upwrds momentum builds as gold breaches $950 – MineWeb

    Source: MineWeb.com

    EXPLOSIVE INCREASE AHEAD?

    Upwards momentum builds as

    gold breaches $950

    The gold price this morning moved quickly through the psychological $950 an ounce level and predictions of $1000 gold being seen sooner rather than later seem far from far-fetched.

    Author: Lawrence Williams
    Posted:  Tuesday , 17 Feb 2009

    LONDON –

    In what has been a relatively steady climb over the past few weeks, gold moved back well above the psychological $950 an ounce mark in this morning’s trading (over $960 at the time of writing) – the first time in seven months it has achieved this level – while silver was approaching $14 an ounce, being pulled upwards by the gold price.  Platinum and palladium were also better as platinum maintained its differential price advantage over gold.

    Indeed gold looked poised to move higher still with ETF inflows continuing and a glimmer of renewed demand interest in India as sentiment may be moving towards a growing feeling that the price is poised to increase further.  Previously India, the world’s largest area of consumption,  has seen gold sales and imports at their lowest level for some time with traders anticipating lower prices.  Today, though, the gold price in rupees hit a new record at over 15,000 rupees per 10 grams and there has been wide expectation of the price moving to 16,000 rupees in the short term with open interest in metal for April increasing a little.

    In the Far East in general there appears to be a movement into gold developing strongly as the stock market continues to drift downwards.  The market has seen the dollar price gold consolidating above $930 of late and there has been a strong feeling that the metal is poised to move higher which is now turning into real purchases and becoming reality.

    Bloomberg reports that there is also talk of Central Banks buying gold rather than selling .  The newswire quotes Steven Zhu of Shanghai Tonglian Futures Co. as saying “There’s been a lot of talk about central banks buying but they are quiet about it because they don’t want to disrupt the market, so the market tends to react when there’s some fresh news.”   There is also a report today that Russia’s Central Bank has raised gold’s share of its reserves and plans to continue doing so.

    To an extent $950 an ounce is seen by some as an important trigger point towards the movement to $1,000 gold and it certainly seems that the momentum is with the yellow metal at the moment.  Stock markets remain weak, and in reality there seems to be little but gloomy news ahead.  Economies are very definitely in recession and confidence in the dollar is not strong.  Gold is increasingly being seen by many as the best way of protecting wealth in the current environment.

    The only weakness has been the fall-off in demand from the traditionally strong Eastern markets, and if the realization that gold is more likely to move higher than fall back takes serious hold there then, coupled with the continuing movement by western investors into gold, the price increase could accelerate.  $1,000 gold may be with us again sooner than expected and this time there is a growing feeling that it could stay there for an extended period.  Virtually no-one seems to be betting against this occurring in the very short term – indeed as momentum builds, which it appears to be doing, there could be an explosive price increase ahead in the months ahead.

    =============================

    Catch the New Bull! – Buy Gold Online –Get 1 Gram Free! Just for Opening and Account, No minimums, Buy Safely, quickly, and at low prices, guaranteed! Bullion Vault.com

    ===================================

    Remember: Don’t Forget about Silver too!

    Listed Gold and Silver Stocks Soar – Mineweb

    Source: Mineweb.com

    SILVER BEST PERFORMING

    Listed gold (and silver) stocks soar

    Gold bullion, and listed gold stocks, decouple from a strange and troubled world.

    Author: Barry Sergeant
    Posted:  Tuesday , 17 Feb 2009

    JOHANNESBURG –

    Precious metal prices moved strongly higher on Tuesday, led by gold bullion, which hopped more than USD 30 an ounce to above USD 970 at one stage, prompting yet another sparkling performance by listed gold equities. Gold bullion is currently trading around seven month highs, and just 6% below the record level it set in March 2008.

    At just over USD 14 an ounce, silver is around 34% off its record highs, while platinum at USD 1,085 an ounce is 52% off, and palladium at USD 219 an ounce, a significant 63% off.  Demand for platinum group metals has been deeply damaged by reduced demand from the auto sector, which uses the metals in auto catalysts.

    Silver stocks, which command a combined global market value (capitalisation) of USD 13bn, currently rank as the best performing equity sub-sector in the world, led by stellar performances from  Silver Standard, Fresnillo, and First Majestic. The global grouping of primary silver producers is relatively small, given that the majority of silver is produced as a byproduct at bigger mines; BHP Billiton, the world’s biggest diversified resources stock, ranks as the world’s biggest silver miner.

    There are, however, hundreds of listed stocks that rank as primary gold producers. This global grouping currently carries a combined market value of just over USD 230bn, dominated by Tier I stocks; Barrick, the world’s biggest gold name by production and value, currently holds a market value of just below USD 34bn. This ranks Barrick as the world’s No 5 overall mining stock, after BHP Billiton, Vale, Shenhua, and Rio Tinto. Two other Tier I gold producers, Goldcorp and Newmont, now also rank as members of the world’s top 10 mining groups.

    While silver stocks, as the small cousin of precious metals, may rank as top equity performers, on a relative basis, the Tier II gold grouping, seen alone, ranks as the world’s leading equity subsector. Some of the top performances in this grouping have been produced by recovery stocks such as Centerra, while JSC Polymetal represents the recovery Russian stock, from a jurisdiction where stock prices were savaged to an extent rarely seen elsewhere.

    It is also of interest that some stocks in the global Tier II gold grouping are currently trading close to 12-month highs – a factor virtually unthinkable in any other sector – as seen in the cases of Iamgold, Eldorado, Red Back, and also Franco-Nevada, a royalty, rather than operating, company. It is of further interest that investors have at long last started to move back into Chinese gold stocks in the past few weeks, benefiting the likes of Zijin (Tier I), Zhongjin, and Shandong (Tier II), and Hunan Chenzhou and Lingbao (Tier III).

    The SPDR Gold Shares exchange traded fund (ETF), which holds gold bullion on behalf of investors, rather than mining the stuff, is close to trading at all time record levels. The fund currently holds physical gold bullion worth just under USD 31bn; if it were an operating entity, it would rank second only to Barrick. However, if other gold ETFs around the world are also taken into account, the amount of bullion currently held on behalf of investors is worth well above USD 40bn. Silver ETFs, which are trading in price terms in line with silver bullion’s 34% discount from its record high, currently hold close to USD 4bn worth of physical metal.

    In terms of individual performances by gold stocks, the top overall Tier I performance award is probably deserved by Kinross; the Tier II award is most difficult, but would likely go to Iamgold, while Novagold appears to be a clear winner among the Tier III grouping. Among developers and explorers, spectacular performances have been put in by La Mancha Resources, Azteca Gold, and San Anton Resource; Central Sun Mining has also shown radical price moves, possibly assisted by corporate action.

    Global tier I gold stocks      
      Stock From From Value  
      price high* low* USD bn  
    Goldcorp USD 32.66 -38.0% 136.0% 23.829  
    Polyus USD 32.00 -60.0% 128.6% 6.100  
    Harmony USD 11.96 -17.9% 118.6% 5.005  
    Lihir AUD 3.47 -21.0% 128.3% 4.840  
    AngloGold Ashanti USD 31.10 -20.5% 132.6% 10.995  
    Zijin CNY 8.28 -62.4% 120.2% 12.475  
    Barrick USD 38.71 -29.3% 124.1% 33.773  
    Newcrest AUD 34.28 -15.4% 107.1% 10.502  
    Gold Fields USD 11.47 -31.9% 147.2% 7.495  
    Kinross USD 19.36 -29.3% 182.6% 12.875  
    Newmont USD 42.60 -22.8% 101.2% 20.152  
    Buenaventura USD 21.75 -49.3% 141.7% 5.979  
    Freeport-McMoRan USD 27.89 -78.1% 77.6% 11.469  
    [[SPDR Gold Shares ETF]] USD 95.28 -5.1% 44.4% 30.709  
    Tier I averages/total -36.6% 126.6% 165.489  
    Weighted averages -43.4% 122.9%    
             
    TIER II Stock From From Value  
      price high* low* USD bn  
    Zhongjin CNY 50.48 -58.8% 121.4% 2.594  
    Iamgold USD 8.24 -4.8% 271.3% 2.437  
    Simmer & Jack ZAR 3.24 -48.7% 120.4% 0.335  
    Yamana USD 9.42 -52.7% 184.6% 6.903  
    High River CAD 0.13 -96.4% 212.5% 0.058  
    Eldorado USD 8.68 -7.1% 264.7% 3.197  
    Agnico-Eagle USD 55.42 -33.6% 165.5% 8.577  
    Centerra CAD 5.23 -66.2% 481.1% 0.895  
    Randgold Resources USD 48.49 -13.8% 117.6% 3.709  
    Shandong CNY 66.94 -43.5% 153.6% 3.406  
    Peter Hambro GBP 5.66 -63.3% 262.8% 0.785  
    Hecla Mining USD 1.77 -86.5% 78.9% 0.385  
    Golden Star USD 1.69 -60.9% 322.5% 0.315  
    Franco-Nevada CAD 27.20 -0.1% 134.1% 2.158  
    Fresnillo GBP 4.00 -30.4% 330.1% 4.094  
    JSC Polymetal USD 5.30 -46.2% 430.0% 1.670  
    Red Back CAD 8.50 -8.1% 197.2% 1.533  
    New Gold CAD 2.93 -69.9% 211.7% 0.493  
    Northgate CAD 1.74 -50.1% 159.7% 0.352  
    Tier II averages/total -44.3% 222.1% 43.897  
    Weighted averages -42.3% 188.1%    
               
    TIER III Stock From From Value  
      price high* low* USD bn  
    Western Goldfields CAD 2.35 -40.8% 370.0% 0.254  
    Great Basin CAD 2.10 -45.2% 130.8% 0.357  
    Sino Gold AUD 5.59 -26.6% 135.9% 1.040  
    Alamos CAD 8.25 -9.7% 135.7% 0.687  
    Highland GBP 0.60 -72.0% 185.7% 0.278  
    PanAust AUD 0.17 -86.8% 101.2% 0.167  
    Kingsgate AUD 4.20 -33.3% 90.9% 0.249  
    Int’l Minerals CAD 3.28 -50.7% 180.3% 0.243  
    Allied Gold AUD 0.41 -50.3% 121.6% 0.107  
    First Uranium CAD 5.15 -45.4% 404.9% 0.617  
    Novagold CAD 4.75 -59.4% 900.0% 0.680  
    Gold Wheaton CAD 0.29 -84.6% 1325.0% 0.213  
    Oxus Gold GBP 0.08 -74.3% 113.9% 0.042  
    Pan African GBP 0.04 -47.5% 113.3% 0.063  
    Citigold AUD 0.23 -49.4% 50.0% 0.106  
    Jaguar CAD 7.15 -47.7% 199.2% 0.362  
    Pamodzi Gold ZAR 1.40 -88.3% 185.7% 0.013  
    Oceanagold AUD 0.58 -81.9% 286.7% 0.060  
    DRDGold ZAR 9.25 -9.8% 223.4% 0.340  
    Dominion Mining AUD 4.82 -1.2% 152.4% 0.316  
    Avoca Resources AUD 1.92 -34.2% 118.9% 0.338  
    Integra Mining AUD 0.23 -67.6% 142.1% 0.057  
    Royal Gold USD 43.33 -13.0% 90.5% 1.474  
    Hunan Chenzhou CNY 12.84 -62.0% 115.8% 1.005  
    Aurizon CAD 4.59 -15.5% 279.3% 0.538  
    Kazakh Gold USD 6.80 -74.8% 209.1% 0.285  
    Gammon Gold CAD 8.74 -22.0% 226.1% 0.829  
    Crew Gold CAD 0.11 -94.6% 110.0% 0.071  
    Lingbao HKD 2.42 -56.0% 202.5% 0.093  
    Zhao Jin HKD 8.57 -54.7% 360.8% 0.483  
    Rusoro Mining CAD 0.70 -63.7% 197.9% 0.216  
    Minefinders CAD 6.59 -51.2% 97.9% 0.308  
    Andina Minerals CAD 1.98 -57.3% 280.8% 0.125  
    Crystallex CAD 0.36 -87.6% 260.0% 0.084  
    Ramelius Resources AUD 0.57 -54.0% 52.0% 0.067  
    Tanzanian Royalty CAD 4.96 -21.5% 149.2% 0.349  
    Minera Andes CAD 0.64 -66.7% 100.0% 0.096  
    Semafo CAD 2.07 -1.4% 176.0% 0.381  
    Tier III averages/total -50.1% 225.7% 12.991  
    Weighted averages -51.9% 170.0%    
                     

    ====================

    In my opinion you need to move now and move quickly and get on this great Bull Market in Gold and ALL Precious Metals -jschulmansr

    My Disclosure: Long Many of the Tier’s 1, 2, 3 mining stocks, Precious Metals Bullion, Long DGP,GDX, CES, ROY. You might say I am a Gold Bug and Proud of it! Good Investing! – jschulmansr

    Catch the New Bull! – Buy Gold Online –Get 1 Gram Free! Just for Opening and Account, No minimums, Buy Safely, quickly, and at low prices, guaranteed! Bullion Vault.com

    ============================

    Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments, it is presented for informational purposes only. As a good investor, consult your Investment Advisor, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investments. – jschulmansr

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    Wake Up Call!

    16 Monday Feb 2009

    Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, Bailout News, banks, Barack Obama, bear market, bull market, capitalism, central banks, China, Comex, commodities, Copper, Currencies, currency, Currency and Currencies, depression, dollar denominated, dollar denominated investments, economic, Economic Recovery, economic trends, economy, Federal Deficit, federal reserve, Finance, financial, Forex, Fundamental Analysis, futures markets, GDX, GLD, gold, Gold Bullion, Gold Investments, gold miners, hard assets, How To Invest, How To Make Money, hyper-inflation, inflation, Investing, investments, Japan, Jschulmansr, Junior Gold Miners, Latest News, majors, Make Money Investing, market crash, Markets, mid-tier, mining companies, mining stocks, monetization, palladium, Peter Brimelow, physical gold, platinum, platinum miners, precious metals, price, prices, producers, production, rare earth metals, recession, resistance, risk, run on banks, safety, Saudi Arabia, silver, silver miners, small caps, spot, spot price, stagflation, Stimulus, Stocks, The Fed, TIPS, Today, U.S. Dollar, uranium

    ≈ 1 Comment

    Tags

    Austrian school, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, dollar denominated, dollar denominated investments, Doug Casey, economic, economic trends, economy, Federal Deficit, financial, Forex, futures, futures markets, gata, GDX, GLD, gold, gold miners, hard assets, hyper-inflation, India, inflation, investments, Jeffrey Nichols, Jim Rogers, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, small caps, sovereign, spot, spot price, stagflation, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

    The U.S. Markets are closed today yet something very interesting is starting to happen. Can you sense it? The shift from deflation to inflation. The “smart money” big investors are sensing it and starting to jump into Gold in a big way! Gold Prices are holding steady overseas above the $935 support level. Todays articles show the why and how of this move by big money into Gold, read on… and Good Investing! – jschulmansr

    ==============================

     Something still stirring in precious-metals pond – Market Watch

    By: Peter Brimelow of Market Watch

    With some wild swings, gold gained about 3% on the week, closing Friday at $941. The Phx Gold Silver Index (XAU:

    Technicians were impressed. Long-term chartist Martin Pring is deflationary-minded at present. Two weeks ago, he remarked that if certain trend lines were broken, “I would be dragged kicking and screaming into the bullish camp”. But now he simply says in his recent weekly Intermarket Review: “Not much to add to my recent bullish comments. Both the metals and shares recently broke out of giant patterns … With our Global Gold Index at a new all-time high – enjoy the ride!”
    Pring also flags a powerful conceptual reason for the gold move. Discussing a chart of the inflation proofed Treasuries, and using the iShares:Lehm TIPS TIPT as a proxy, Pring says: “Here we see the inflation protected bonds, or TIPs. Who needs these in a deflation? But look, the price just broke to the upside … and volume is expanding! When we look at the longer term we see it’s still in a primary bear market … However this week’s breakout suggests a turn is likely.”
    In other words, the bond market is getting seriously concerned about inflation. See Website
    The Privateer, being Australian, is even more direct in its weekly remarks: “Why is gold going up? It is certainly not in spite of the global mania for bailout programs now sweeping the world. It is because of these programs. The more ‘liquid’ the global financial powers that be make their money — by creating it in ever larger swathes — the more they run the risk that the world starts to look elsewhere for a viable and trustworthy way to exchange goods and services.”
    The Privateer’s invaluable $US 5X3 point and figure chart has now broken above its last downtrend, although its proprietor would like more progress: “This week the chart got up to and just above the second of the two downtrends. The ‘poke’ above the line which came with Gold’s close above $U.S. 945 on Feb. 12 is not yet decisive, a close above $U.S. 960 would be.” See Website
    Silver, which I reported last week was exciting the gold bugs by showing unusual leadership characteristics, persisted — rising 3.5% on the week, including on Friday despite gold’s fall, and pushing the Gold/Silver ratio to 68.9 from last week’s 69.5.
    But the star of the week was the reported bullion holdings of Spdr Gold Trust. (GLD:
    GLD is regarded with deep suspicion by the radical gold bugs who think the metal’s price is manipulated. But at the least it has to been seen as a measure of the Western Hemisphere investment appetite for gold.
    In contrast, Le Metropole Cafe monitors Indian gold imports and reports that, unusual in the past few years, the world’s largest gold consumer is standing aside for now. See Website
    Interestingly, two sentiment indicators did not react much this past week. Mark Hulbert’s HGNSI on Friday stood unchanged at 60.90%. MarketVane’s Bullish Consensus actually lost a point on Friday to 78%, gaining only 3 points on the week. See Website
    In serious gold moves, MarketVane excursions into the 90s are reportedly common.
    ===================================

    Here is where I buy my Bullion, get one free gram of Gold just for opening an account! Catch the New Bull! – Buy Gold Online – Get 1 gram free! – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    ===================================
    Major Investors Piling into Gold – Seeking Alpha
    By: James West of Midas Letter

    Endeavour Financial Corp (TSX:EDV) closed a $100 million equity offering last week, and several other “bought deal” financings point to a strengthening trend: major investors are piling into gold.

    The Offering was underwritten by a syndicate co-led by GMP Securities L.P. and Canaccord Capital Corporation (the “Underwriters”). Endeavour will use the funds to support its investment activity in the mining sector with an emphasis in the short term on precious metals.

    The first quarter of 2009 has seen well over $1 billion flow into near term and existing mining companies, which is a reflection of the strong gold price amid safe haven demand. With estimates of U.S. government spending reaching as high as $2 trillion, large value investors are increasingly deterred by U.S. Treasury related securities in favour of precious metals.

    • Newmont Mining (NYSE:NEM), one of the world’s largest gold mining companies, raised US$1.7 billion in a combined common share/convertible debt deal which it will use primarily to fund the acquisition of the remaining 33.33% interest in the Boddington project in Western Australia that it does not already own and the additional capital expenditures that will result from its increased ownership in the Boddington project, as well as for general corporate purposes. Citigroup Global Markets and J.P. Morgan Securities led the placement.
    • Freeport McMoran Copper and Gold (NYSE:FCX) raised US$740 million through the issuance of 26.8 million common shares at $28 per share;
    • Kinross Gold Corporation (KGC) announced a “bought deal” financing for US$360 through the issuance of 24,035,000 million common shares US$17.25 per common share. The underwriters were led by UBS Securities Canada Inc.;
    • Osisko Mining Corporation (OSKFF.PK) entered into another “bought deal” led by Thomas Weisel Partners and BMO Capital Markets. The offering of 77 million units at $CA4.55 a share will gross CA$350.4 million. Osisko is developing the 6.28 million ounce Canadian Malartic Project Quebec.

    Smaller deals are becoming more common for junior emerging gold companies as well. Among the recent actions:

    • Centamin Egypt (CELTF.PK) raised $CA69 million through the issuance of 106.2 million shares at CA$0.65 per share for development and construction of the Sukari Project in Egypt. This financing was led by Thomas Weisel Partners and Cormark Securities.
    • Romarco Minerals Inc. (TSX.V:R) announced a bought deal Friday worth $20 million for the development of the Haile Gold Mine in South Carolina. Romarco issued 54 million units at $0.38 each. The financing was led by a syndicate of underwriters led by Macquarie Capital Markets Canada Ltd. and including Paradigm Capital Inc. and GMP Securities L.P.
    • International Tower Hill Mines (THM) sold 2 million common shares at $2.50 per share for gross proceeds of CA$5 million, which will be directed towards further development of its projects in Alaska and Nevada. The placement was a “bought deal” led by a syndicate of underwriters led by Canaccord Capital Corporation and including Genuity Capital Markets and GMP Securities L.P.
    • Exeter Resource Corporation (AMEX:XRA) raised CA$25.2 million at $2.40 a share for development of its assets in Argentina and Chile.

    And it isn’t just gold that is attracting big financing. On February 10th, Uranium One (SXRZF.PK) announced a $270 million investment by a Japanese Consortium comprised of Tokyo Electric Power Company, Incorporated (TKECF.PK), Toshiba Corporation (TOSBF.PK), and The Japan Bank for International Cooperation.

    Concurrently with the execution of the subscription agreement, Uranium One has also entered into a long-term off-take agreement and a strategic relationship agreement with the Japanese consortium, both of which will become effective upon closing of the private placement.

    The off-take agreement provides the consortium with an option to purchase, on industry-standard terms, up to 20% of Uranium One’s available production from assets in respect of which Uranium One has the marketing rights.

    Junior Uranium company First Uranium Corp. (FURAF.PK) was also the beneficiary of a bought deal financing led by Macquarie Capital Markets this week, which saw First Uranium place 20.5 million units of its shares at $3.00 per unit for gross proceeds of $61.5 million. First Uranium will direct the funds towards the development of the Ezulwini Mine in South Africa.

    Endeavour Financial is followed by many analysts and newsletter writers for its robust project pipeline.

    Brien Lundin, who publishes the Gold Newsletter, says one of the main reasons he follows Endeavour Financials is because of management – especially Mr. Frank Giustra. He says this team now senses a market bottom, as they are raising capital to go after assets that now cost a fraction of what they did last year, or even six months ago. He intimates strongly that his subscribers should do the same, using Endeavour as their proxy. A mix of entrepreneurial expertise and value investing, he outlines what the smart money is doing now.

    =============================

    Here is where I buy my Bullion, get one free gram of Gold just for opening an account! Catch the New Bull! – Buy Gold Online – Get 1 gram free! – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    ====================================

    Gold: Now Demonstrating Trust in Obama – Seeking Alpha

    By: Boris Sobolev of Resource Stock Guide

    Gold is Starting to Believe the Obama Administration

    Despite making loud headlines about stimulating the economy, the US government has been unable to raise the level of optimism among the general public, while the stock market seemed to drop into a deep state of apathy.  

     

    Last week we received the long-awaited economic stimulus packet as well as the so-called plan for the rescue of the US financial system. We have already voiced our skepticism regarding the structure of the stimulus and its potential effect on the economy in a prior article.

     

    As far as the size of the $787 billion package, it is clear that it is too small and too spread out into 2010 and beyond to be called a stimulus. $787 billion is just 5.6% of the GDP and when spread over two years will account for just 2.8% at a time when many industrial economies around the world are contracting by 5-10% per year. It can only be called a life support package, not a stimulus.

    Japan, which got into a deflationary spiral as a result of a real estate bust, spent much more than 100% of its GDP since 1991 just to see its economy stagnate. Construction related investment alone ate up $6.3 trillion of public funds over the 17 years since 1991. Infrastructure spending accounted for $350 billion to $400 billion per year for the first half of the 1990s for an economy half the size of the United States.

    The results of the Japanese fiscal stimulus were unimpressive, although it could be argued that without this stimulus, it could have been much worse.

    With the United States facing similar post bubble dynamics as Japan did twenty years ago, how can we expect greater effectiveness of the Obama stimulus plan when it is insufficient and much of is clearly misdirected?

    In reality, this economic stimulus package has to be viewed as only the first one of many yet to come. By having the US dollar as a world reserve currency, the US government can be much more effective than its Japanese counterpart in printing its own currency.

    We will soon be quantifying the size of the government stimulus plans in trillions rather than in billions. Within the next 3 to 4 years, government spending can easily reach $10 trillion, doubling the size of the US government debt.

    One of the main problems with this crisis is that the majority of the debt bubble is related to residential real estate, which does not produce cash flow, but only seems to eat it up. As home prices decline and unemployment rises, debt serviceability is worsening dramatically.

    In order to avoid social unrest and to maintain popularity, the Democratic majority will face two realistic options which could begin to address the economic disaster:

    1. Forgive portions of mortgage debt which cannot be serviced. But who will pay for the losses – clearly not the weak banks. Uncle Sam would pick up the tab by printing more currency.
    2. Print new dollars to increase the nominal income of the indebted population through tax cuts, job creation, jobless benefits and various social spending.

    There is no other politically possible way out of this mess other than to run the printing press. The way of the free market via bankruptcies is not popular so there is no sense to even discuss it.

    Within hours President Obama will sign the stimulus into law, but we are sure that this is just the beginning of the government spending campaign.

    As far as the US banks, the new US Treasury Secretary seems to be mimicking his predecessor, Hank Paulson. The essence of the announced “plan” is as follows: “We are absolutely sure that we will save our banking system, but are yet unsure of how we will do so. We will find out very soon, however. Stay tuned”.

    While not knowing what to do with the banking system, the government is trying to temporarily act as one. The only specific point in Geithner’s announcement is the plan to increase the Term Asset-Backed Securities Loan Facility (TALF) facility from $200 billion to $1 trillion. This joint initiative with the Federal Reserve expands the resources of the previously announced, but not yet implemented TALF.

    In essence, TALF will support the purchase of loans by providing the financing to private investors. In theory, this should help unfreeze and lower interest rates for auto, small business, credit card and other consumer and business credit. Treasury will use $100 billion to leverage $1 trillion of lending from the Federal Reserve. The TALF, which will potentially have greater effect than the stimulus plan, passed in a blink of an eye without any debate.

    The markets around the world have deteriorated in deep state of indifference to the first round of actions of the new US government. Only gold is starting to demonstrate its trust in the Democratic majority. Since the inauguration, investors poured $6 billion into gold purchases through GLD alone. This is an increase of 210 tonnes in gold holdings or 24% in less than a month.

    click to enlarge

    Huge investment demand around the world has put an end to a steep gold correction of the second half of 2008. Most intermediate and long term technical indicators for gold have turned decisively bullish. A test of new highs by gold is very probable this spring.

    In sum, gold investors are starting to believe that the Obama Administration sees one way out of economic problems which will for sure resurrect inflation.

    ================================

    My Note: Did you catch that? They’re believing alright, not that Obama will get the situation fixed, just that he will cause inflation; yes even hyper-inflation , maybe even stagflation! Jump into Gold now before it’s too late… -jschulmansr

     

    Here is where I buy my Bullion, get one free gram of Gold just for opening an account! Catch the New Bull! – Buy Gold Online – Get 1 gram free! – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    ====================================

    Moody’s, S&P Dole Out Global Downgrades – Time to Go Gold? – Seeking Alpha

    By: Mark O’Byrne of Gold and Silver Investments

     Gold rose again on Thursday, briefly rising above $950/oz and was up 0.6% on the day. Determined selling on the open in Asia saw gold fall and profit taking has seen gold fall in Asia and in early trading in London. This is to be expected as gold had risen by more than 15% in less than a month.

     

     

    US, UK Credit Ratings Look Set to Be Downgraded

    The credit rating agency Moody’s has said that the UK and US credit ratings were being “tested”. In a novel and somewhat bizarre departure, Moody’s has split various “AAA” sovereign countries into three categories based on their strength in weathering the economic storm, denoting Ireland and Spain as the weakest, with the UK and US somewhere in the middle and Germany, France, Canada and the Scandinavian nations at the top.

    This will in time be seen as gimmickry. Standard and Poor’s have already downgraded Spain to AA+ and did not create sub grades within the credit rating system.

    Some have criticized Moody’s for being “unfair” to Ireland, Spain, the UK and US and have argued that these agencies previously gave almost everybody good ratings, and underestimated risks, but were now going to the other extreme.

    This is errant nonsense and the unfortunate fact is that Moody’s, the other credit rating agencies and the vested interests in the financial services industry continue to underestimate risks, as they have done for months and years.

    Given the massive deterioration in the public finances and economies of these nations, by right they should be downgraded and unfortunately in the coming months they will inevitably be downgraded.

    But Moody’s and all the rating agencies realize that this would compound an already disastrous financial and economic crisis. Many pension funds internationally have mandates or investment guidelines to only invest in “AAA” rated government bonds and if these countries bonds were downgraded, they would be forced to sell those bonds en masse. This would likely see a crash in the already very overvalued government bond markets and see long term interest rates rise quickly and sharply.

    The creditors of the US in Russia and China have rightly criticized the ratings agencies for their highly irresponsible practices in recent years and are increasingly nervous about their US denominated assets.

    Ratings agency Standard and Poor’s in January downgraded Spain’s sovereign debt rating to “AA+” from “AAA” in January, citing insufficient means to deal with weak growth and a ballooning budget deficit. As they did the sovereign rating of New Zealand. The fiscal position in the UK and US is arguably much worse than in these two countries (Martin Wolf of the Financial Times recently said that major US banks, with their humongous Wall Street liabilities, are insolvent) and thus it seems inevitable that the UK and US will be downgraded in the coming months.

    If the US is downgraded, then in effect the reserve currency of the world is being downgraded and this has huge implications for the international monetary system. Not surprisingly there have been op-ed pieces in the Financial Times and the Wall Street Journal calling for a return to some form of gold standard.

    The governments of the world are nationalizing and socializing the meltdown in the shadow banking system and the international system with potentially disastrous consequences for us all.

    Conditions are set to get markedly worse before they get better and the experience of Argentina and other previously wealthy South American countries may be instructive. The IMF is called in and there are structural adjustments, social services are affected or discontinued, banks nationalized, savings inaccessible, food and energy insecurity rise.

    This is a potential reality for large western economies, especially if governments keep trying to inflate their way out of the current crisis. This is leading to massive currency debasement and will potentially lead to very significant stagflation and maybe even what could be called hyper stagflation.

    Now more than ever, it is essential that individual savers and investors, companies, pension funds and sovereign wealth funds have an allocation to and directly own actual physical gold bullion. Paper exchange traded funds with all the attendant counter party, custodian, sub custodian, auditing and indemnification risk are speculative trading vehicles and not physical gold.

    In these unprecedented economic times, it is irresponsible and extremely high risk not to have an allocation to gold bullion in an investment portfolio.

    Disclosure: no positions

    ==========================================

    My Note: No Positions??? Mr. O’Byrne I think you need to follow your own advice above! Here is where I buy my Bullion, get one free gram of Gold just for opening an account! Catch the New Bull! – Buy Gold Online – Get 1 gram free! – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

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    Is Gold the only salvation from this Financial Armageddon? – MineWeb

    Source: MineWeb

    Indications are that the global financial situation could yet get far worse before it starts getting better – particularly in Europe – and gold may again prove to be the only real way of protecting wealth in a continuing global financial meltdown.

    Author: Lawrence Williams
    Posted:  Monday , 16 Feb 2009
    LONDON – 
     

     

    “It ain’t over ’til its over” is one of the best known quotations from baseball catcher and coach Yogi Berra and as the global financial crisis unwinds it is very apposite yet again.  We ain’t anywhere near the end yet and possibly the worst is yet to come as far as European banks in particular are concerned.  Markets have breathed sighs of relief as various banks have been bailed out and stimulation packages are being approved if not already implemented. 

     

    But, one gets the feeling that any relief is premature.  The debt situation in a huge number of debtor nations – virtually the whole of Eastern Europe falls into this category – is dire and has not really yet fallen into the sights of the investment world – but bankers must be quaking in their shoes as surely they are aware of the potential financial Armageddon that still lies ahead. 

    And this time it is the already shaky Western European banking sector that is most at risk.  US Banks, accused of starting this all, maybe far less vulnerable to the times ahead.  True the US financial sector may have got us into this mess, but European bankers followed suit and, in the event, may be shown to have behaved far more recklessly than their American counterparts.  It would seem that some of the potential shortfalls being faced would be beyond the financial ability of Central Banks, Governments and transnational agencies like the IMF to sort out.  The system is like a house of cards.  One major failure could bring the whole house tumbling down. 

    This is the kind of situation that leads to global nightmares – wars even.  Radical extremists get elected to positions of power – as with the rise of National Socialism in Germany after the crash of the Weimar Republic with its hyperinflation.  We could be in for a very sticky time ahead as the real implications, and depth, of the financial meltdown catch up with us. 

    The problems ahead may not be beyond the wit of man to devise a solution which can ‘save the world’, but that is unlikely to come from UK Prime Minister Gordon Brown who appears to have laid claim to this cachet in a freudian moment of rhetorical madness.  Don’t forget this is the same Gordon Brown who decimated the UK’s gold reserves by selling half of them off (395 tonnes) at gold’s low points from 1999-2002 – amounting to some $12bn at today’s prices – a sum the UK treasury would give its eye teeth for in the current financial crisis, although this is small beer relative to the sums squandered by the UK banks.  But it is an indicator of Gordon Brown’s acumen, or lack of it, in dealing with global financial trends. 

    Indeed Gordon Brown’s thinking is probably echoed by many others in the European and perhaps the US financial hierarchy which doesn’t bode well for any rescue package that will actually work to stem the flow of toxic debt which has built up all around the world and may almost certainly amount in total to a greater sum than all the world’s financial reserves combined,  But then that is the nature of banking.  It only takes a run on almost any bank to bring the whole institution crashing down, and to allow any country to fail – and there are signs that the European Central Bankers may let some Eastern European states go under, thus triggering a domino effect of defaults worldwide, to bring the world banking system to its knees – or worse.  There are even fears that past high flyers like the Irish Republic could be forced to default on its debts, and undoubtedly the situation for, say, the Baltic states is far worse still. 

    What solution is there out there.  Printing money on an unprecedented scale will expose the world to huge inflationary pressures for years to come, but this may be the only way forward using more conventional solutions.  Perhaps a huge revaluation in the price of gold could help bolster some treasuries and bring some confidence back into the system.  And, as with any bank run it is confidence which is needed to stem the tide, not necessarily actual money! 

    But where does all this leave the investor?  Not in a happy position.  The logic of further financial collapses and bank failures would be to knock the markets down and down, which in turn takes wealth out of the system and decimates pensions upon which an increasingly aging society is dependent. 

    Buy gold may be an answer to protect oneself, but as we saw last year, gold too can be vulnerable as in times  of reduced liquidity funds and individuals have to sell any liquid assets to cover their positions.  But then gold is probably not as vulnerable as other assets – again as we have seen over the past year.  Those who were invested in gold at the beginning of 2008, for example, and did not sell during the year, at least maintained the value of their holdings while virtually all other investment options crashed, although this was not true of most gold stocks. 

    Now we are seeing professional and institutional investors moving into gold in a big way just to try and protect their, and their clients’  wealth.  As we have pointed out here frequently, gold ETFs are seeing an unprecedented inflow of funds, although there are those out there who would say it is better to hold physical gold than any form of paper gold because of a growing distrust of financial institutions and paper solutions. 

    And perhaps rather gold than other precious metals – notably silver.  Silver would be sure to be dragged up on gold’s coattails, but perhaps not as much  this time – even though history tells us that silver’s volatility leads it to perform better than gold in percentage terms on the upside and worse on the downside.  We are in a different situation with silver not really a monetary metal any longer.  Industrial demand pressures on silver may well mitigate any price rises here. 

    Gold’s performance, though, is perhaps also dependent on investment demand outstripping a fall off in the jewellery market and an increase in liquidation of such holdings into the scrap sector.  If the big Asian economies like India and China, where mark-ups on gold jewellery are minuscule compared with the West, falter significantly then reduced demand and increased supply from this sector will need to be soaked up by the investment sector.  At the moment this seems to be capable of doing this hence the recent gold price strength, but unless sentiment changes in India in particular, where buyers seem to be waiting for lower prices, the fall in gold purchases there may limit global gold price growth.  If liquidity becomes a problem in the North American markets again, this could also dent upward movement. 

    But overall, physical gold, gold ETFs and selected gold stocks would seem to be the best wealth protectors out there.  As commentators have pointed out, prices may remain relatively volatile, but currently the overall price trend tends to be upwards movement, followed by stabilisation, before the next upwards resistance levels are tested.  Gold does look to be steadily climbing back towards the psychological $1,000 an ounce level but it has had trouble sustaining increases beyond this level in the past.  Perhaps it will be third time lucky for the gold bulls.

    =================================

    My Note: Prudence dictates at least 10% of your portfolio should be in Gold. Personally, I have that and also a lot of my discretionary funds invested in precious metals Stocks, ETF’s, Bullion…jschulmansr

    Here is where I buy my Bullion, get one free gram of Gold just for opening an account! Catch the New Bull! – Buy Gold Online – Get 1 gram free! – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    =======================================

    Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investments. –  jschulmansr

     

     

     

    GLD

    GLD, , ) GLD . These rocketed a startling 13.7% to 985 tonnes, setting records each day.

    XAU

    Delayed quote dataHUI, , ) added 1.36% to 311.16. The stock market, in case you missed it, lost ground.

    Commentary: Gold’s gains for week catch bugs’ interest

    By Peter Brimelow, MarketWatch
    NEW YORK (MarketWatch) — Something was indeed stirring in the precious metals pond, as I reported a week ago. Key investment letters say it still is. See Feb. 8 column

     

    Here is where I buy my Bullion, get one free gram of Gold just for opening an account! Catch the New Bull! – Buy Gold Online – Get 1 gram free! – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

     

    ==================================

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    Shock and Awe! – Doug Casey

    12 Thursday Feb 2009

    Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, Bailout News, banking crisis, banks, Barack Obama, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, capitalism, central banks, China, Comex, commodities, Contrarian, Copper, Credit Default, Currencies, currency, Currency and Currencies, Dennis Gartman, depression, DGP, dollar denominated, dollar denominated investments, Doug Casey, economic, Economic Recovery, economic trends, economy, Fed Fund Rate, Federal Deficit, federal reserve, Finance, financial, Forex, Fundamental Analysis, futures, futures markets, gata, GDX, GLD, gold, Gold Bullion, Gold Investments, gold miners, hard assets, how to change, How To Invest, How To Make Money, hyper-inflation, IMF, India, inflation, Investing, investments, Jeffrey Nichols, Jim Rogers, Jschulmansr, Keith Fitz-Gerald, Latest News, Long Bonds, majors, Make Money Investing, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, mining stocks, monetization, Moving Averages, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious, precious metals, price, price manipulation, prices, producers, production, protection, rare earth metals, recession, resistance, risk, run on banks, safety, Sean Rakhimov, SEO, Short Bonds, silver, silver miners, small caps, sovereign, spot, spot price, stagflation, Stimulus, Stocks, TARP, Technical Analysis, The Fed, TIPS, U.S., U.S. Dollar, uranium, volatility, warrants, XAU

    ≈ Comments Off on Shock and Awe! – Doug Casey

    Tags

    Bailout News, Bollinger Bands Saudi Arabia, Brian Tang, China, Comex, commodities, Copper, Currencies, currency, Dennis Gartman, dollar denominated, dollar denominated investments, Doug Casey, Federal Deficit, Forex, futures, futures markets, gata, GDX, GLD, gold miners, hard assets, hyper-inflation, India, investments, Jeffrey Nichols, Jim Rogers, Keith Fitz-Gerald, majors, Marc Faber, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, small caps, sovereign, spot, spot price, stagflation, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

    Late Breaking: I came across this from the Contrarian Master Himself- Mr. Doug Casey. Here is his take for 2009 a must read for investors- especially Gold Bugs! Enjoy and Good Investing! – jschulmansr

    ================================

    Catch the New Bull! – Buy Gold Online – Get 1 gram free! – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    ====================================

    2009: Another Year of Shock and Awe – Seeking Alpha

    By: Jeff Clark of Casey Research

     

    In their annual forecast edition, the editors of BIG GOLD asked Casey Research Chairman and contrarian investor Doug Casey to provide his predictions and thoughts on issues everyone’s thinking about these days. Read what he has to say on the economy, deficits, inflation, and gold…

     

     

    The $1.1 Trillion Budget Deficit


    My reaction is that the people in the government are totally out of control. A poker player would say the government is “on tilt,” placing wild, desperate bets in the hope of getting rescued by good luck.

     

     

    The things they’re doing are not only unproductive, they’re the exact opposite of what should be done. The country got into this mess by living beyond its means for more than a generation. That’s the message from the debt that’s burdening so many individuals; debt is proof that you’re living above your means. The solution is for people to significantly reduce their standard of living for a while and start building capital. That’s what saving is about, producing more than you consume. The government creating funny money – money out of nothing – doesn’t fix anything. All it does is prolong the problem and make it worse by destroying the currency.

    Over several generations, huge distortions and misallocations of capital have been cranked into the economy, inviting levels of consumption that are unsustainable. In fact, Americans refer to themselves as consumers. That’s degrading and ridiculous. You should be first and foremost a producer, and a consumer only as a consequence.

    In any event, the government is going to destroy the currency, which will be a mega-disaster. And they’re making the depression worse by holding interest rates at artificially low levels, which discourages savings – the exact opposite of what’s needed. They’re trying to prop up a bankrupt system. And, at this point, it’s not just economically bankrupt, but morally and intellectually bankrupt. What they should be doing is recognize that they’re bankrupt and then start rebuilding. But they’re not, so it’s going to be a disaster.

    The U.S. Economy in 2009

    My patented answer, when asked what it will be like, is that this is going to be so bad, it will be worse than even I think it’s going to be. I think all the surprises are going to be on the downside; don’t expect friendly aliens to land on the roof of the White House and present the government with a magic solution. We’re still very early in this thing. It’s not going to just blow away like other post-war recessions. One reason that it’s going to get worse is that the biggest shoe has yet to drop… interest rates are now at all-time lows, and the bond market is much, much bigger than the stock market. What’s inevitable is much higher interest rates. And when they go up, that will be the final nail in the coffins of the stock and real estate markets, and it will wipe out a huge amount of capital in the bond market. And higher interest rates will bring on more bankruptcies.

    The bankruptcies will be painful, but a good thing, incidentally. We can’t hope to see the bottom until interest rates go high enough to encourage people to save. The way you become wealthy is by producing more than you consume, not consuming more than you produce.

    Deflation vs. Inflation

    First of all, deflation is a good thing. Its bad reputation is just one of the serious misunderstandings that most people have. In deflation, your money becomes worth more every year. It’s a good thing because it encourages people to save, it encourages thrift. I’m all for deflation. The current episode of necessary and beneficial deflation will, however, be cut short because Bernanke, as he’s so eloquently pointed out, has a printing press and will use it to create as many dollars as needed.

    So at this point I would start preparing for inflation, and I wouldn’t worry too much about deflation. The only question is the timing.

    It’s too early to buy real estate right now, although a fixed-rate mortgage could go a long way toward offsetting bad timing. It would let you make your money on the depreciation of the mortgage, as opposed to the appreciation of the asset. Still, I wouldn’t touch housing with a 10-foot pole – there’s been immense overbuilding, immense inventory. And people forget: a house isn’t an investment, it’s a consumer good. It’s like a toothbrush, suit of clothes, or a car; it just lasts a little bit longer. An investment – say, a factory – can create new wealth. Houses are strictly expense items. Forget about buying the things for the unpaid mortgage; before this is over, you’ll buy them for back taxes. But then you’ll have to figure out how to pay the utilities and maintenance. The housing bear market has a long way to run.

    The U.S. Dollar and the Day of Reckoning

    It’s very hard to predict the timing on these things. The financial markets and the economy itself are going up and down like an elevator with a lunatic at the controls. My feeling is that the fate of the dollar is sealed. People forget that there are 6 or 8 trillion dollars – who knows how many – outside of the United States, and they’re hot potatoes. Foreigners are going to recognize that the dollar is an unbacked smiley-face token of a bankrupt government. My advice is to get out of dollars. In fact, take advantage of the ultra-low interest rates; borrow as many dollars as you can long-term and at a fixed rate and put the money into something tangible, because the dollar is going to reach its intrinsic value.

    The Recession

    This isn’t a recession, it’s a depression. A depression is a period when most people’s standard of living falls significantly. It can also be defined as a time when distortions and misallocations of capital are liquidated, as well as a time when the business cycle climaxes. We don’t have time here, unfortunately, to explore all that in detail. But this is the real thing. And it’s going to drag on much longer than most people think. It will be called the Greater Depression, and it’s likely the most serious thing to happen to the country since its founding. And not just from an economic point of view, but political, sociological, and military.

    For a number of reasons, wars usually occur in tough economic times. Governments always like to find foreigners to blame for their problems, and that includes other countries blaming the U.S. In the end, I wouldn’t be surprised to see violence, tax revolt, or even parts of the country trying to secede. I don’t think I can adequately emphasize how serious this thing is likely to get. Nothing is certain, but it seems to me the odds are very, very high for an absolutely world-class disaster.

    Gold’s Performance in 2008

    The big surprise to me is how low gold is right now. It’s well known that even if we use the government’s statistics, gold would have to reach $2,500 an ounce to match its 1980 high. I don’t necessarily buy the theories that the government and some bullion banks are suppressing the price of gold. Of course, with everything else going on, the last thing the powers-that-be want is a stampede into gold. That would be the equivalent of shooting a gun in a crowded theater; it could set off a real panic. But at the same time, I don’t see how they can effectively suppress the price. Either way, the good news is that gold is about the cheapest thing out there. Remember, it’s the only financial asset that’s not simultaneously someone else’s liability. So I would take advantage of today’s price and buy more gold. I know I’m doing just that.

    Gold Volatility

    Gold will remain volatile but trend upward. I don’t pay attention to daily fluctuations, which can be caused by any number of trivial things. Gold is going to the moon in the next couple of years.

    Gold Stocks

    Last year, it seemed to me that we were still climbing the Wall of Worry and that the next stage would be the Mania. But what I failed to read was the public’s indirect involvement through the $2 trillion in hedge funds. On top of that, while the prices of gold stocks weren’t that high, the number of shares out and the number of companies were increasing dramatically. Finally, the costs of mining and exploration rose immensely, which limited their profitability.

    The good news is that relative to the price of gold, gold stocks are at their cheapest level in history. I still have my gold stocks and the fact is, I’m buying more. I’m not selling, because I think we’re starting another bull market. And this one is going to be much steeper and much quicker than the last one. I’m not a perma-bull on any asset class, but in this case I’m forced to go into the gold stocks. They’re the cheapest asset class out there, and the one with the highest potential.
    =========================================

     

    Catch the New Bull! – Buy Gold Online – Get 1 gram free! – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

     

     

    =========================================

    Enjoy and Good Investing – jschulmansr

     

    Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investments. –  jschulmansr

     

     

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    Gold’s Big Test – Will it Pass?

    12 Thursday Feb 2009

    Posted by jschulmansr in 10 year Treasuries, 20 yr Treasuries, Bailout News, banking crisis, banks, Barack Obama, bull market, capitalism, central banks, China, Comex, commodities, Credit Default, Currencies, currency, Currency and Currencies, DGP, dollar denominated, dollar denominated investments, economic, Economic Recovery, economic trends, economy, futures markets, GDX, GLD, gold, Gold Bullion, Gold Investments, gold miners, hard assets, How To Invest, How To Make Money, hyper-inflation, IMF, inflation, Investing, investments, Jschulmansr, Junior Gold Miners, Latest News, Make Money Investing, market crash, Markets, mining companies, mining stocks, palladium, physical gold, platinum, platinum miners, precious metals, price, prices, producers, production, rare earth metals, recession, silver, silver miners, small caps, spot, spot price, stagflation, Stimulus, Stocks, TARP, The Fed, Today, U.S. Dollar, uranium

    ≈ 1 Comment

    Sorry for the late post today, as I am writing gold closed today at $949.20 up another $4.70 oz. We are now at Gold’s big test, if it can successfully clear and close over $950 -$960 oz. then ther is nothing stopping it to go for a new test of the all time highs. Today’s action was a feint like a boxer about to deliver the knockout punch! However a word of caution if Gold fails after 2-3 attempts at clearing the $950 level then a retracement back to the $875-$890 level will occur. It will consolidate and then come back up to retest the $950 level. Personally however, in my opinion I think this is it the 2nd successful close over $940, I think we are getting ready to see Gold go back and test all time highs. If you hurry you can still get aboard! – Good Investing! – jschulmansr

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    Catch the New Bull! – Buy Gold Online – Get 1 gram free! – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    ======================================

    Stocks Are Doomed, Only Cash or Precious Metals May Survive – Seeking Alpha

    By: Doctor O of Sell The Rally

     

    President Obama, his administration, and the Democratically controlled Congress are working as quickly as possible to spend as much money as possible on their constituent base, to consolidate their stranglehold on power. There is still no bank rescue plan, nothing in the “stimulus” bill to create or even slow job losses, and seemingly no understanding about the enormous amount of bad debt that is rapidly losing value and destroying the financial system from the inside out.

     

     

     

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    Catch the New Bull! – Buy Gold Online – Get 1 gram free! – Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

    =================================

    Will Gold Hit $1,000 – Seeking Alpha

     

    Gold prices broke out Wednesday and traded above $940/ounce. This is a new 6-month high! In my article last week, on 2/4/09, I said:

     

     

     

    Catch the New Bull! – Buy Gold Online – Get 1 gram free! – Just open an Account, Buy Safely, quickly, and at low prices, guaranteed! – Bullion Vault.com

     

     

    In the three months ending January 31, SLV led its benchmark index by nearly 25%, trumping PowerShares’ DB Silver offering, DBS, by a narrow 1.25%. If analyst predictions play out, the demand for silver could continue to grow in upcoming weeks, even as a dismal holiday season for jewelry persists well into the new year. In a recent report, UBS upped forecasts for both silver and gold, citing expectations of speculation and investor interest, as uncertainty still reigns in U.S. markets.

    Supporting the hypothesis that the flight to precious metals still results from investor uncertainty is UBS strategist John Reade, who noted that “purchases of physical gold have jumped over the past six months as investors’ fears about the current financial crisis and the possible outcomes from government efforts to support banks and economies have intensified.” UBS also estimates that investor interest in precious metals such as gold will double in 2009, compared with 2007. If this prediction plays out, gold could reach an average of $1,000 before interest wanes.

    Shares of SLV track the spot prices of silver and are backed by physical silver reserves. On February 3, New York–based SLV announced that the bullion holdings for the fund rose 77 tons, approximately 1%. This increase puts the fund at a record 7,530.2 tons of bullion, up 11% since January 2. While other factors come into play during the intraday trading of SLV shares, increasing stocks of bullion underscore the growing interest that SLV is seeing in 2009.

    Futures, currency and commodity prices are extremely volatile and unpredictable, so understanding the reasons behind silver’s recent spike is an important step in avoiding the swell and vacuum of SLV’s swings. As currency concerns continue to plague investors worldwide, an increasing number of people have turned to silver as a “why-not” alternative to investing in unpredictable notes. India, whose citizens seize silver as a tangible alternative to currency, imports an average of 3,000 tons of silver per year. The Economic Times recently reported that banks may not be able to import regular amounts of silver in the future, a factor that could drive silver prices there drastically higher in black market arenas.

    So what makes SLV stand apart from the ever-expanding sea of commodity ETF choices? Its track record, size, and liquidity are all comforting factors for investors looking to jump into the silver fray. With 245 million shares outstanding and an average of 6 million shares traded per day over the last three months, SLV simply dwarfs peers such as DBS. Launched in January 2007, DBS has a three-month average daily trading volume of nearly 200,000—a factor that makes SLV a more liquid choice in white-knuckle times.

    Investors should also be wary because while SLV tracks the spot price of silver, other important factors come into play during the intraday trading of the ETF. In addition to reflecting the price of physical silver, SLV also takes into account counterparty risk and the ever-changing emotions of investors in the open marketplace. While the silver is likely “there,” the ratings on even the most venerable of banks—like SLV keeper Barclays—could come into question in perilous economic conditions. Success in the fund is also contingent on the increasing price of silver. Placing funds in SLV is not the same as under the mattress—management fees and “iShares Silver Trust expenses” are exacted by the issuer on a regular basis, slowly eroding the value of one’s investment over time, if the price of silver does not continue to rise.

    The longer the economic stimulus plan is stripped and scrubbed across the floor of the Senate, the more investors could continue to pile into a tangible investment like SLV until the storm passes. When the outcome becomes clearer, one-tune investments like SLV may become a more proportionate segment of portfolios and lose steam as the attention that has prompted their rise refocuses on other sectors.

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    Will Gold Reach $5000 an Ounce? – Seeking Alpha

    By: Mark O’Byrne of Gold and Silver Investments

     

     

    Gold surged a further 3.3% yesterday to $942.45 (as did silver) as worries about the US and global financial system and economy continue to grow and governments print money on an unprecedented scale to combat the economic crisis. Asian and European stock markets are again under pressure this morning.

    The strong close above $930/oz yesterday should see us once again challenge the record highs of $1,003/oz seen last March (March 17th) when Bear Stearns collapsed.

    We have since had a long period (nearly 12 months) of correction and consolidation and thus a solid foundation has been built from which the next leg of the bull market will likely be launched. Our forecast at the beginning of the year for gold to rise as high as $1,250/oz looks increasingly conservative.

    Gold Surges to New Records in Euros and Sterling as Crisis Deepens

    Gold continues to surge to record highs in other major currencies (the London AM Fix this morning was at $944.00 USD, £666.33 GBP and €737.04 EUR. Worries about the health of the financial system and economy in the UK and EU are leading to weakness in the euro and sterling that has seen them fall in value versus gold. Gold has surged to €737/oz and over £666.33/oz (see charts below).

    Gold to Reach $5000/oz According to Respected Goldcorp Founder

    The respected founder of Goldcorp (GG), Rob McEwen told Bloomberg how he sees gold rising to as high as $5,000/oz in the next four years. Goldcorp is the second largest gold mining company in the world by market capitalization.

    As governments increase the money supply to combat recession, bullion will more than double to $2,000 an ounce by the end of next year. “Politicians around the world are listening to cries from their electorates and they’re giving money to all callers,” McEwen said yesterday.

    McEwen has more than $100 million in gold investments and said he also has a “big, big” holding in bullion. McEwen said he started buying bullion in August 2007, at the beginning of the subprime mortgage crisis. “I realized we had reached an inflection point regarding money,” McEwen said. “It was all about protecting money, and gold served that purpose.”

    The recent trend of fiat currencies falling vis a vis gold looks set to continue for the foreseeable future. McEwen’s bold prediction looks outlandish now (as did predictions of gold at over $1,000/oz in 2001) but given the confluence of extremely strong fundamentals, gold will likely rise to levels in the coming years that seem unfathomable today.

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    My Note:- I think a more realistic view would be Gold at $2500 to $3000 in next 2-3 years. However if everything goes to H*** in a Handbasket then yes $5000 and more! – Good Investing! – jschulmansr

    Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investments. –  jschulmansr

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    Silver The Other Precious Metal – Seeking Alpha

    By Don Dion of Fidelity Independent Advisor

     

    In a global economic crisis for which the media has seemingly exhausted its cache of negative adjectives to describe the meltdown, one is hard-pressed to find an example of success in the quagmire that has become the marketplace. When scanning the ranks of the ETF Sector Momentum Table, however, one fund’s sweeping forward progress makes it a glinting example among its peers. iShares’ Silver Trust (SLV) vaulted from the No. 60 position in the rankings on December 2, 2008, to the No. 14 spot on February 3, 2009. If precious metals continue to outpace agricultural commodities, and the “flight to safety” extends into a probable “odyssey toward conservative investing,” SLV will be an interesting fund to track in upcoming months.

     

    “We’ll wait for GLD to confirm that $88 will hold. Above $90, we should see more buyers coming in. March in-the-money calls are reasonably priced. AEM is another good vehicle to play gold. Although it is very volatile, it is a momentum stock and can run up fast!”

    GLD successfully tested $88 and closed above $90 on Tuesday. On Wednesday, it jumped on high volume, more than twice the average volume!! GLD closed at $92.29, up +2.31%. AEM also did well, gaining +6.58%, or $3.48, finally breaking above $55.

    click to enlarge

    GLD

    GLD added $2.08 to close at $92.29. It jumped on very high volume Wednesday. It closed just below the resistance at $92.5. This is only a soft resistance. The nearest hard resistance is between $95-$97.5.

    Compared to the stock market, which had been treading water in a tight range since November last year, GLD had done much better. We can see a big divergence in this comparson chart:

    The SPX has basically traded flat. On the other hand, GLD has risen nearly +30%, from $72 to $92!

    GLD’s chart is still very strong. Its daily MAs are curving higher and still holding a bullish formation. The MACD is also turning up. I think GLD can easily revisit $100 within the next few months, which means gold can retest $1,000, and likely go above. Again, March “within-the-money” calls are reasonably priced. If GLD goes to $100 within the next few weeks, these options will probably double.

    Good day and HappyTrading! ™.

    Disclosure: no positions

    ========================================

    My Note: Yes! Gold will hit $1000 in fact will go and test the $1050 level. I n the case above the writer Mr Wang did an excellent forcast but notice no positions! I hope he follows his own advice and jumps on either (GLD) or if you want more bang for the buck (DGP). My disclosure I am Long (DGP), and (GLD). Also Long Bullion, Large, mid-tier and junior mining shares in the whole Precious metals spectrum including Rare Earths and Strategic Metals. Also Don’t forget silver as the next article points out. Finally do not forget Platinum and Palladium their time is coming too, mark my words! – jschulmansr

     

    Home foreclosures are accelerating. We await a tidal wave of personal and corporate bankruptcies and the implosion of the commercial real estate market that will trigger more massive losses in the banking system.

    In short, I have no confidence in the U.S. Government to “solve” the current depression. In fact, they will no doubt make it worse by socializing the economy and spending money obscenely. No wonder the only thing that’s working is precious metals.

    I cannot consider investing in any stock until this virulently anti-business administration is either voted out of office or starts to see things more rationally.

    The Last Depression, Coming to a Town Near You

    Keep Away from U.S. Stocks as They Cascade Down

    Gold Threatening to Break Out To New Highs Against the U.S. Dollar

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    Murphy’s Law? – What is Gold doing?

    09 Monday Feb 2009

    Posted by jschulmansr in Bailout News, banking crisis, banks, Barack Obama, Comex, Copper, Currency and Currencies, dollar denominated, dollar denominated investments, economic, Economic Recovery, economic trends, economy, financial, Fundamental Analysis, GDX, GLD, Gold Bullion, Gold Investments, gold miners, How To Invest, How To Make Money, hyper-inflation, inflation, Investing, investments, Jschulmansr, Junior Gold Miners, Make Money Investing, Markets, mining companies, mining stocks, palladium, physical gold, platinum, platinum miners, precious metals, price, prices, producers, production, rare earth metals, silver, silver miners, small caps, spot, spot price, stagflation, Stimulus, U.S. Dollar

    ≈ Comments Off on Murphy’s Law? – What is Gold doing?

    Tags

    Austrian school, Bailout News, banking crisis, banks, bear market, Bollinger Bands Saudi Arabia, Brian Tang, bull market, central banks, China, Comex, commodities, Copper, Currencies, currency, deflation, Dennis Gartman, depression, dollar denominated, dollar denominated investments, economic, economic trends, economy, Federal Deficit, financial, Forex, futures, futures markets, gata, GDX, GLD, gold, gold miners, hard assets, hyper-inflation, India, inflation, investments, Jeffrey Nichols, Jim Rogers, Keith Fitz-Gerald, majors, Marc Faber, market crash, Markets, Michael Zielinski, mid-tier, mining companies, monetization, Moving Averages, palladium, Peter Grandich, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, recession, risk, run on banks, safety, Sean Rakhimov, silver, silver miners, small caps, sovereign, spot, spot price, stagflation, Technical Analysis, TIPS, U.S., U.S. Dollar, volatility, warrants, XAU

    As I write todays post Gold is testing support around the $895 level. Mr. Murphy is laughing today as you can tell by today’s articles. However, I still feel this is another buying opportunity to add more, especially among the Gold mining Stocks. Many of the producers are still selling at or near book value. Pull up a chair, take a bite, you won’t be eating humble pie! – Good Investing! -jschulmansr

    ==================================

    Catch the New Bull! – Buy Gold Online – Safely, quickly, and at low prices, guaranteed! Bullion Vault.com

    ======================================

    Gold Charts Are Plugging Along – Seeking Alpha

    By: Jeff Pierce of Zen Trader

    I realize there’s been a lot of talk about gold putting in a top, and I’m aware that we are at longer term resistance on a multi-year chart, however short term I’m still seeing bullish charts. Take a look at the following 15 min chart on a few random gold stocks and you’ll see a very bullish constructive chart. It moves up 3 steps, and gives back 2. The moving averages have a nice flow to them as the stock continues to push higher and volume seems to favor the bulls. I’m a big fan of the 15 min chart and I always look at it to see which way the smaller trend is moving and until I see these charts roll over on this time frame, then the longer term time frames should be safe for now. 

    One note of caution. This picture can change very quickly so you have to stay on top of it. Be on the lookout for double topping patterns and use it in conjuction with a 15 min of GLD while looking for breakdowns in the ETF.

    gold

     

    goldgold

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    Gold poised, Experts predict $1000 plus – Mineweb

     

    HIGHER INFLATION FOR YEARS TO COME

    Many analysts and bankers now expect gold to break through $1,000 in the near term and probably go higher on financial instability and potential US dollar weakness.

    Author: Pratima Desai
    Posted:  Monday , 09 Feb 2009

    LONDON (Reuters) – 

    Gold prices are set to jump towards $1,000 an ounce and probably beyond to new records as droves of investors fearing financial instability and surging inflation pile into the precious metal.

    Expectations of a weaker dollar, which makes gold priced in the U.S. currency cheaper for holders of other currencies, will also help boost prices of the precious metal seen as a store of value during uncertain times.

    Strong investor interest in the precious metal can be seen in the record holdings above 867 tonnes of the world’s largest gold-backed exchange-traded fund, the SPDR Gold Trust.

    “The core problem for investors is financial instability, if you look at the IMF numbers, we are only halfway through the non-performing loan cycle,” said Ashok Shah, chief investment officer at fund manager London & Capital.

    The IMF last month declared losses on U.S. loans and securitised assets were likely to reach $2.2 trillion (1.5 trillion pounds), up from an October estimate of $1.4 trillion.

    These losses replicated in other major developed economies have frozen bank lending to corporates and consumers and led to recession in the global economy.

    In an attempt to kick-start bank lending and activity central banks have slashed interest rates. Governments have pumped large amounts of money into the global economy and more is planned.

    “Governments are supplying liquidity into the system and unless they sterilise it (issue bonds) they are laying the foundations for much higher inflation for years to come … These are the things gold thrives on,” Shah said.

    “More corporate, financial and economic bad news will do the trick. Once it gets a foothold and picks up momentum gold can easily break through to new highs.”

    Spot gold hit a record high of $1,030.80 an ounce in March 2008 and is now at around $910, a gain of more than 10 percent since the middle of January.

    INSURANCE POLICY

    Potential inflationary pressures can be seen in the growth of money supply. January M1 rose about 20 percent year-on-year in the United States where a stimulus plan of about $800 billion is in the works.

    “M0 is growing at about 9 percent worldwide,” said Angus Murray, founder of fund manager Castlestone Management.

    “People need a real asset to offset inflation. Investors are putting gold into their portfolios as an insurance policy. In 24 or 36 months time, gold will be higher by a minimum of the growth rate in money supply.”

    Also on the horizon is a weaker dollar, which in recent weeks has risen against the euro and pound, partly because U.S. investors have been taking their money home, fund managers say.

    “When that repatriation reverses the dollar will weaken. Let’s call it 14 or 16 percent — in dollar terms gold will rise by that much again,” Murray said.

    UPSIDE RISK

    Bank analysts too, for similar reasons have changed their gold price forecasts. But they expect prices to peak this year.

    Swiss-based UBS (UBSN.VX: Quote) expects gold prices to average $1,000 an ounce this year from a previous forecast of $700 and $900 in 2010 from $700 an ounce.

    “Gold has rallied in most major currencies despite a firm US dollar, a sign of strong buying interest in the metal,” UBS said in a note this week.

    Gold priced in euros hit a record of above 726.89 an ounce early this week and in sterling it touched a record above 660 last month.

    U.S. bank Goldman Sachs (GS.N: Quote) followed with a forecast of $1,000 an ounce in the next three months from $700 previously.

    “If financial risks … remain high, gold prices could remain higher for longer, presenting upside risk to our forecasts,” Goldman said.

    “The recent strong demand for gold has not been irrational but rather pretty much in line with the probabilities of financial and sovereign default.”

    (Editing by Sue Thomas)

    © Thomson Reuters 2009. All rights reserved.

    ======================================

    Catch the New Bull! – Buy Gold Online – Safely, quickly, and at low prices, guaranteed! Bullion Vault.com

    ======================================

    Brian Tang: Bullish on Finite Resources – The Gold Report

    Source: The Gold Report

     

    Since 2003, Fundamental Research Corp. (FRC) has been focusing on companies not widely followed by brokerage firms, bringing investors and undervalued small and micro cap companies together. In this exclusive interview with The Gold Report, FRC founder Brian Tang and his crew forecast the primary driver of base metal prices in 2009, the future of gold and copper and the infinite upside of investing in finite resources.

    The Gold Report: Brian, could you give us a summary of your firm and its business model? You have strong opinions about how individual investors should approach paid-for research.

    Brian Tang: Sure. I founded the firm in 2003. At that time, a lot of the investment banks were being scrutinized for producing research that was tied to corporate finance and I was also in corporate finance—but more on the debt side. On the debt side, all research is paid for. Firms like Moody’s and Standard and Poor’s will charge firms money, and then issue a credit rating on them. So given that the corporate finance model was being scrutinized, I thought why not apply the debt model simply to the equity side, where we would charge a fee to issue a rating on the equity of companies?

    Of course, there is the potential for a conflict in that type of situation. What we’ve done is instigate policies to mitigate those conflicts; for example, we only charge our fees flat and in advance and we don’t accept stock, so the companies have to pay in full before we get started. We sign agreements with the companies that basically relieve us from any liability for negative reports. They agree that they will not sue us for negative comments. Once we’re engaged, we have to finish the contract. They cannot prevent us from publishing further research. And, if you look at the distribution of our ratings—where 25% of our ratings are hold, sell or suspend—I think you can get an idea that our analysts are truly independent. We’ve issued sell ratings right off the bat, and that company has paid, we’ve done our due diligence, and we didn’t like the company; so we initiated coverage at a sell. So that is the business model. Also, if you look at our performance on Investars, you will see we have done quite well in the past.

    In terms of our focus, we focus on small and micro cap companies that aren’t widely followed by brokerage firms. We think by focusing on companies that no other analysts are following, we can add value by discovering these undervalued companies.

    Currently, a lot of our coverage is in the natural resource sector—mining, oil and gas—and the other two sectors that we cover are industrials and healthcare. From time to time, we publish special reports, industry reports, on topics of interest that we think investors would like to read about.

    TGR: In this market, many people are suggesting that people avoid the micro small caps because of the shakeout in the marketplace. In essence, avoid the juniors and focus on the producers. What insights can you provide to our investors regarding that?

    BT: I definitely think that, in this type of environment, the producers or the near-term producers will do better just because there’s less risk to them. Also, it really depends on what type of company you’re looking at. If the company is well financed, we don’t see that as a problem. We have downgraded some companies to sell recently because they were not well financed; we think they might run into some liquidity problems, so definitely I would avoid those kinds of companies. It also depends on what kind of commodity they’re in. I’d look for some commodities that are better than others.

    But, also, small caps tend to recover first when a bull market does resume, and they also tend to do worse when a bear market starts, simply because they’re more levered in terms of operating leverage. They’re smaller, so they get affected more by swings in the economy. They recover first, but they falter first, as well. So if you avoid them totally, I would say you would miss out when the economy starts to turn again. And because nobody can predict when that will happen, I would not totally avoid them, but I would be very selective.

    TGR: In the research you do and provide to subscribers, do you give specific sell-hold recommendations and pricing?

    BT: Yes. We issue buy, hold or sell recommendations. We don’t call it a target price; we call it a fair value, and we also issue a risk rating from very low risk to highly speculative. We’re registered as a securities advisor with the BC Securities Commission.

    TGR: Could Siddharth Rajeev, your head of research, give us your global outlook for what will happen in commodities in 2009? Specifically base metals, precious metals, and gold-silver?

    Siddharth Rajeev: The primary factor that we believe is going to affect the pricing of base metals is the global GDP growth assumptions; and we believe that in 2009 we are going to see a significant drop in GDP growth. For example, the International Monetary Fund (IMF) forecasts global GDP growth of 2.2% in 2009; and that was about 5% in 2007 and 3.7% in 2008. And then most of the developed economies like the U.S., Japan, Europe and Canada are expected to be in a recession in 2009, while emerging countries like China, India, Brazil and Russia are not in a recession (but they are expected to have a significant drop in their growth rate). So we believe that these reductions in the GDP growth rates will affect demand growth for most of the base metals.

    We have a long-term positive outlook on copper, primarily because we still believe in the Brazil, Russia, India and China (BRIC) countries’ growth; so we believe that, in the long term, they will achieve growth. Those countries will drive the demand for base metals.

    BT: Also, if you look at current commodity prices, they have declined a lot from the peaks—but those peaks were not necessarily based on fundamentals. I think they were based more on speculation. If you look at where the price is today compared to historical averages, the prices are still much higher. For example, we have a long-term forecast (2012+) for gold of $600 per ounce. Even though that’s lower than today’s prices, it’s still double the historical average. Gold has historically averaged only about $300 per ounce, and that’s the same with oil prices.

    SR: For gold we expect prices to converge to $600 per ounce in the long term. But in the near term, we are bullish on gold, especially because we expect the U.S. dollar to depreciate due to the slowdown in the U.S. and the negative real interest rates in the U.S. And we expect inflation to creep in once the effects of the large stimulus package are felt. So, it’s because we expect the U.S. dollar to depreciate and we have seen in the past that gold prices have had a negative correlation with the U.S. dollar. Other reasons that we’re bullish include higher cash costs, as well as relatively flat supply. So we’re bullish on gold in the near term; but in the long term, we expect prices to converge to $600 once the global economy improves and the U.S. dollar recovers.

    TGR: Do you have some specific companies you can share with us that you feel are getting some good financing and are close to production, which you feel our investors should know about?

    SR: One of our top picks is called SilverCrest Mines Inc. (TSX.V:SVL). They have three silver-gold projects in Mexico with 43-101 compliant resources, and then they are planning to put their main project, the Santa Elena project, into production later this year. Based on our evaluation, our valuation of the company is $1.98 per share while the shares are trading at 45 cents.

    In terms of comparables, their enterprise value (EV) to resource ratio is just 25 cents per ounce, while our estimate of the average ratio of its peers is over $2. So we like the company, number one, because we have a positive outlook on both silver and gold; number two, they’re closer to production; number three they have a favorable valuation; number four, and most important now, is that they are in a decent cash position. The second company I want to talk about, that we’re currently doing due diligence on, is called Gold Resource Corp. (OTCBB:GORO) (FSE:GIH). They have four high-grade silver-gold projects in Mexico.

    They’re planning to put their main project in Mexico into production mid-2009, and their plans are to produce 70,000 ounces of gold in the first 12 months of production. And the best part is that management estimates that their cash cost is going to be just $100 per ounce.

    TGR: Wow. For gold?

    SR: Yes. So they’re aiming to be one of the lowest-cost producers around. That’s one of the companies that we think investors could track.

    TGR: Do they have the management team or the production team to start producing gold there, or will they be joint venturing?

    SR: No, no. They have the management team, and they are arranging the financing now. Recently, they had announced a strategic alliance with Hochschild Mining (LSE:HOC). They hold 5% of equity in them and they are planning to do another 10%. So, even though they have to raise capital, we don’t think it will be that tough compared to a lot of companies. Management is also expecting a payback of less than a year, which is pretty good.

    TGR: I know one of the companies you’re following is Commerce Resources Corp. (TSX.V:CCE) (PK SHEETS:CMRZF). Can you comment on them?

    BT: Vincent, our geologist, will discuss Commerce.

    Vincent Weber: With regard to Commerce, they’re focusing largely on their Upper Fir project. They did 131 HQ diameter drill holes totaling just over 26,000 meters in their last phase of drilling, and they’re targeting carbonatites that host tantalum and niobium mineralization. Tantalum is used for capacitors, like those used in cell phones; niobium is used for special alloys for steels. They just put together a 2,000-ton bulk sample on the Upper Fir Carbonatite, which they’re sending to a company in Richmond, B.C., for sampling to characterize the deposit. They’re also going to put together a flow sheet and a pilot test plant to try and determine the appropriate recovery method.

    SR: We believe that Commerce is one of the companies that raised capital at the best time—when the market was at a peak, so based on their latest financial statements, they had about $22 million in cash at the end of July 2008 and that’s like 20 cents per share. Share prices are currently 24 cents per share, so the market value is very little for their projects.

    TGR: What’s the burn rate?

    SR: Burn rate, based on the last financial statement, was around $700,000 per month in the second half of 2008. If they continue to spend at the same rate, we are expecting at least $15 million in cash right now, which is like 13 cents – 14 cents per share; so it shows that the market values their project at 10 cents per share and they have over 100 million shares outstanding, which is like $10 million for their projects.

    TGR: You just issued an update on Castle Gold Corporation (TSX.V:CSG). Can you share with us any insights on that company?

    SR: Yes, they have two producing projects; and, in our valuation, we actually raised our fair value estimate to $1.67. Currently shares are trading at 46 cents. We like the company because it’s currently producing, generating cash flows and is expecting to reduce operating costs next year. This year, the company had very high operating costs; but they expect to reduce costs in the next year, which will help them generate positive cash flows starting in ’09.

    BT: The El Castillo mine experienced operating costs of $685 per ounce, which was higher than expected, and the reason for that was they incurred a high strip ratio of 1.55. They were expecting only .6. This strip ratio is waste to ore. When we spoke to management, the company said that they expect operating costs to decrease in 2009 by improving mine efficiencies, which would include utilizing larger equipment and also using that larger equipment to increase their gold production from the mine.

    TGR: Where are they currently producing, and do you expect them to spend a lot on capital investments in ’09?

    BT: Guatemala and Mexico. In our models for ’09, we estimated a capex budget of $2.15 million. Our models are showing that, in 2008 and 2009, they should be cash flow positive.

    TGR: Are there any other base or minor metals or gold or silver companies that you currently like?

    VW: Another project that I’m currently doing some due diligence on, which is an intriguing deposit, is West High Yield Resources (TSX.V:WHY). They have a large magnesium deposit that they’re exploring in British Columbia; that’s a different type of metal from all the other companies.

    TGR: What is magnesium used for?

    VW: It’s used for lightweight alloys. That’s one of the main uses.

    TGR: What is the outlook for minor metals in 2009?

    SR: In terms of minor metals, I can give a general idea on where those metals will perform in 2009 – 2010. Basically, for several minor metals, including molybdenum, manganese, chromium, vanadium, these companies serve the steel sector and most of these metals had a good run in 2007 primarily because of a significant increase in steel production in China; and, of course, their forecast at that time of steel production was very optimistic, which is why we believe that those metals had a good run in 2007.

    But now, as we expect the global GDP growth to slow down, we expect steel production also to slow down, which will affect the demand side of all these metals. So we are expecting all these metal prices to stay soft in 2009 and 2010, just like our outlook for base metals.

    TGR: Do you think the stimulus package that Barack Obama is proposing will have an impact on that?

    SR: It will have a positive impact on it, but then we think that in 2009 – 2010 the GDP growth drop will have a stronger effect, which will push down the prices or soften the prices. Beyond that point, once the infrastructure and the BRIC country GDP growth starts to improve, we expect the demand for these metals to improve then.

    TGR: Thanks so much for your time today. We really appreciate it.

    Brian Tang, BBA, CFA, founded Fundamental Research Corp. in 2003, and has successfully led the firm to be recognized as on of the fastest growing companies in the province of B.C. Prior to Fundamental Research Corp., Brian was an analyst in the corporate banking group of one of the world’s largest international banks where he performed fundamental analysis on Financial Post 500 companies (the Canadian equivalent of the Fortune 500). Prior to this, he worked at a financial advisory firm where he analyzed and published research on Canadian equity mutual funds.

    Fundamental Research provides institutional quality equity research coverage on small and micro cap companies through its extensive distribution network. Its major institutional delivery channels include institutional sites such as Reuters, retail sites such as Stockhouse, and subscribers. Fundamental Research’s performance has been highly ranked in the past by Investors.

    Want to read more exclusive Gold Report interviews like this? Sign up for our free e-newsletter, and you’ll learn when new articles have been published. To see a list of recent interviews with industry analysts and commentators, visit our Expert Insights page.

    =====================================

    Catch the New Bull! – Buy Gold Online – Safely, quickly, and at low prices, guaranteed! Bullion Vault.com

    As I said Mr. Murphy is smiling this morning! – I still thing $950 is opur next target, if that level is broken then we are on our way to $1000+. Good Investing!- jschulmansr

    Nothing in today’s post should be considered as an offer to buy or sell any securities or other investments; it is presented for informational purposes only. As a good investor, consult your Investment Advisor, Do Your Due Diligence, Read All Prospectus/s and related information carefully before you make any investments. –  jschulmansr

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    Latest Obama Eligibility News and More…

    25 Sunday Jan 2009

    Posted by jschulmansr in 2008 Election, Achievement, Barack Obama, bible, communism, Electoral College, id theft, John McCain, Presidential Election, socialism, Today, u.s. constitution, U.S. Dollar, Uncategorized

    ≈ 2 Comments

    Tags

    2008 Election, Barack Dunham, Barack Hussein Obama, Barack Obama, Barry Dunham, Barry Soetoro, capitalism, Chicago Tribune, Columbia University, Currency and Currencies, D.c. press club, Electoral College, Electors, Finance, fraud, Free Speech, gold, Harvard Law School, hawaii, id theft, Indonesia, Indonesian Citizenship, Investing, investments, Joe Biden, John McCain, Latest News, legal documents, Markets, name change, natural born citizen, Oath of Allegiance of the President of the United State, Occidental College, Phillip Berg, Politics, poser, Presidential Election, Sarah Palin, socialism, Stocks, Today, treason, u.s. constitution, U.S. Dollar, Uncategorized, voter fraud, we the people foundation

    Well here we are, Obama’s 1st act was to flub his oath of office, there are still cases on Obama eligibility filtering up. One thing we should be aware of, when has it become legal for a person to consult with the judges who are going to hear and potentially try his case? Once again total dis-regard and disdain for the Constitution. Yes, I know it was a “courtesy” trip, however, timed conveniently before the judges are set to see if the latest eligibility case has merit? And was there a secret session? Watch the 1st Video First! ***Eye Opening-***jschulmansr

    ==================================================

    Where Is Your Birth Certificate? Mr Open President?

    ==================================================

    Religious Leader On Obama’s Birth Certificate

    Dr. James David Manning, PhD (ATLAH Church) is angered by Barack Obama’s failure to present his Birth Certificate.


    ================================================

    Why The Oath Was Retaken

    By: Joseph Farah World Net Daily

    When Supreme Court Chief Justice John Roberts and President-elect Barack Obama flubbed the oath of office on inauguration day, WND was pilloried for prominently noting the problem.

    “Oh, come on,” wrote one emailer. “This is just being nitpicky. Your antipathy for Obama is showing in your willingness to jump on him for everything.”

    Yet, one day later, Roberts and Obama agreed to repeat the oath of office – this time in a more private setting and following the specific requirements of the U.S. Constitution.

    Maybe paying strict attention to the Constitution isn’t nitpicky after all?

    Article II, Section 1 of the Constitution stipulates the exact 35 words of a proper oath of office: “I do solemnly swear (or affirm) that I will faithfully execute the Office of President of the United States, and will to the best of my Ability, preserve, protect and defend the Constitution of the United States.”

    Since some of those words were transposed and left out of the original oath on the day of inauguration, Roberts feared the matter could become a point of contention. Twice before in American history presidents Chester A. Arthur and Calvin Coolidge needed to repeat their oaths because of similar mistakes.

    I’m glad someone still takes at least part of the Constitution seriously. Unfortunately, another part of Article II, Section 1 was completely trampled upon during the 2008 election process and right up through the swearing in ceremony. That is the issue of whether Obama is indeed, as the Constitution requires, a “natural born citizen.” Perhaps he is, perhaps he isn’t. Perhaps we’ll never know, because no controlling legal authority has ever required proof and publicly affirmed its validity.

    Again, when such issues were raised, many have suggested it’s simply nitpicking.

    But the Constitution either means precisely what it says or it doesn’t. If we’re going to fudge on such simple, straightforward matters as eligibility requirements for the president and oaths of office, where does the fudging end?

    And, conversely, if it is so critically important to recite the specific and exact 35 words of the oath of office as delineated in the Constitution, why was it not important to establish Obama’s eligibility beyond any shadow of a doubt?

    Should this matter now be dropped?

    Or should it be relentlessly pursued?

    What would happen now if it were determined that Obama was not, in fact, constitutionally eligible to become president? It’s certainly not a simple matter like restating the oath.

    On the other hand, because of the enormous potential for raising a constitutional crisis, should the American people just sweep the matter under the rug

    ?

    These are the tough questions we have been left with by Obama and all those in authority who allowed this question of eligibility to fester for so long.

    Once again, they provide us with some practical arguments for taking the Constitution seriously and literally in all matters. The Constitution is the bedrock of our system

    of governance. It is the tie that binds our nation together. It is the foundation for the rule of law in America.

    There is nothing frivolous about its requirements.

    There is nothing nitpicky about adhering to them.

    So, I’ll ask the pointed question one more time: “Where’s the birth certificate?”

    Where’s the proof Barack Obama was born in the U.S. or that he fulfills the “natural-born American” clause in the Constitution? If you still want to see it, join more than 200,000 others and sign the petition demanding proof of eligibility now!

    Maybe we need a national movement of people asking the same question in venue after venue – anywhere and everywhere the new president appears. Maybe we need rallies on the National Mall where ordinary Americans bring copies of their birth certificates and display them proudly with accompanying signs that say: “I’ll show you mine if you show me yours.”

    Do we need a national uprising of the American people simply to get the Constitution observed and taken seriously and literally?

    It seems like a lot to ask.

    Yet, on the other hand, is there a more important national cause?

    ===============================================

    Okay this part of the constitution is important but proving eligibility to be the President under the constitution is not? I am confused!

    ===============================================

    President’s meeting with Judges questioned

    Lawyer challenging eligibility raises issue of secret conference

    Source: World Net Daily

    A lawyer working on a case before the U.S. Supreme Court that challenges the eligibility of President Obama is raising concerns over a meeting between the defendant in the case and the judges who are expected to review it.

    The case is one of many brought before U.S. courts that allege Obama doesn’t meet the “natural born” requirement of the U.S. Constitution for the president. It’s one of about half a dozen that have reached the U.S. Supreme Court, which already has declined to grant hearings to several cases.

    Orly Taitz, whose case is scheduled to be heard tomorrow in a conference among justices – a private meeting at which they review cases and decide whether they should hold a hearing – confirmed on her website today that a supplemental brief in her arguments had been distributed.

    But the website also reported she “had to explain … many of us citizens are also concerned about the eight out of nine justices meeting privately with Mr. Obama (while the cases are pending).”

    The blog continued, “No reporters were allowed. No attorneys were invited on behalf of the plaintiffs. This causes many of us citizens to question the rules of judicial ethics and causes us to question the impartiality on behalf of the justices.”

    The report said “quite a number of people” have raised their questions with their U.S. representatives over the issues.

    According to a CBS report, Obama visited the Supreme Court before his inauguration at the invitation of Chief Justice John Roberts. The report described it as a protocol visit.

    According to a separate published report, Obama and then-Vice President-elect Joe Biden met in a court conference room with Roberts and seven other justices for about 45 minutes.

    The report said the only absent justice was Samuel Alito.

    Where’s the proof Barack Obama was born in the U.S. or that he fulfills the “natural-born American” clause in the Constitution? If you still want to see it, join more than 215,000 others and sign the petition demanding proof of eligibility now!

    The supplemental documents in the Taitz case cite an executive order concerning qualifications issued by President Bush Jan. 16.

    “This action is seeking the mandate for the U.S. State Department, the FBI and the Director of the Personnel Department to seek the documents for verifying Obama’s legitimacy as president and also his citizenship of the United States,” the blog reported.

    The Supreme Court document reveals that the Taitz case is scheduled for conference tomorrow, and her supplemental briefs have been distributed to the justices.

    Taitz said her arguments rest on precedents from both the California Supreme Court, which years ago removed a candidate for president from the ballot because he was only 34, and the U.S. Supreme Court’s affirmation of the ruling. The Constitution requires a president to be 35. Her case raises the issue of Obama’s birthplace and citizenship status, which also are specified in the Constitution.

    The lawsuits allege in various ways that Obama does not meet the “natural born citizen” clause of the U.S. Constitution, Article 2, Section 1, which reads, “No Person except a natural born Citizen, or a Citizen of the United States, at the time of the Adoption of this Constitution, shall be eligible to the Office of President.”

    Some allege his birth took place in Kenya, and his mother was a minor at the time of his birth – too young to confer American citizenship. They argue Obama’s father, Barack Obama Sr., was a Kenyan citizen subject to the jurisdiction of the United Kingdom at the time and would have handed down British citizenship.

    There also are questions raised about Obama’s move to Indonesia when he was a child and his attendance at school there when only Indonesian citizens were allowed and his travel to Pakistan in the ’80s when such travel was forbidden to American citizens.

    One case, handled by Gary Kreep of the United States Justice Foundation, is seeking Obama’s school records from Occidental College, which could reveal if Obama attended class on aid intended for foreign students.

    Another lawyer working on similar allegations, Philip J. Berg, has written to Congress seeking an investigation, while Taitz’s filings have been before the U.S. Supreme Court.

    Berg, whose information is on his ObamaCrimes.com website, said the issue isn’t going to disappear.

    Others agreed.

    “Should Senator Obama be discovered, after he takes office, to be ineligible for the Office of President of the United States of America and, thereby, his election declared void,” argues a California case brought on behalf of Ambassador Alan Keyes, also a presidential candidate. “Americans will suffer irreparable harm in that (a) usurper will be sitting as the President of the United States, and none of the treaties, laws, or executive orders signed by him will be valid or legal.”

    WND twice has organized opportunities for readers to send FedEx letters to the Supreme Court, asking for consideration of the issue on its merits.

    The most recent campaign generated 12,096 messages, following the earlier effort that resulted in 60,128 letters.

    Obama has claimed in his autobiography and elsewhere that he was born in Hawaii in 1961 to parents Barack Hussein Obama Sr., a Kenyan national, and Stanley Ann Dunham, a minor. But details about which hospital handled the birth and other details provided on the complete birth certificate have been withheld by Obama despite lawsuits and public demands for release.

    Meanwhile, a separate report has emerged in the Buffalo, N.Y., News about a woman who said she recalled being told about Obama’s birth in Hawaii. Barbara Nelson reported she was having a dinner with Dr. Rodney T. West, an obstetrician, when he discussed the birth of a baby boy to Stanley Ann Dunham, Obama’s mother.

    She said she later taught Obama as a high school student in Hawaii.

    WND senior reporter Jerome Corsi went to both Kenya and Hawaii prior to the election to investigate issues surrounding Obama’s birth. But his research and discoveries only raised more questions.

    The biggest question was why, if a Hawaii birth certificate exists as his campaign has stated, Obama hasn’t simply ordered it made available to settle the rumors.

    The governor’s office in Hawaii said there is a valid certificate but rejected requests for access and left ambiguous its origin: Does the certificate on file with the Department of Health indicate a Hawaii birth or was it generated after the Obama family registered a Kenyan birth in Hawaii?

    =================================================

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    Scary, they’re actually Going to Pass This?

    24 Saturday Jan 2009

    Posted by jschulmansr in Austrian school, Bailout News, banking crisis, banks, Barack Obama, bear market, capitalism, central banks, Comex, commodities, Copper, Currencies, currency, Currency and Currencies, dollar denominated, dollar denominated investments, economic, Economic Recovery, economic trends, economy, Federal Deficit, Finance, financial, Forex, Fundamental Analysis, futures, futures markets, gold, gold miners, hard assets, How To Invest, How To Make Money, inflation, Investing, investments, Latest News, Make Money Investing, market crash, Markets, mining companies, mining stocks, platinum, platinum miners, precious, price, price manipulation, prices, producers, production, recession, risk, run on banks, safety, silver, silver miners, small caps, sovereign, spot, spot price, stagflation, Stimilus, Stimulus, Stocks, TARP, Technical Analysis, U.S. Dollar, volatility

    ≈ Comments Off on Scary, they’re actually Going to Pass This?

    Tags

    agricultural commodities, alternate energy, Austrian school, Bailout News, banking crisis, banks, bear market, Bollinger Bands, bull market, bullion, capitalism, central banks, China, Comex, commodities, communism, Copper, Currencies, currency, deflation, depression, diamonds, dollar denominated, dollar denominated investments, economic, Economic Recovery, Economic Stimulus, economic trends, economy, Federal Deficit, financial, Forex, futures, futures markets, gold, gold bars, gold coins, gold miners, goldbugs, hard assets, heating oil, hyper-inflation, India, inflation, Investing In Gold, investments, Keith Fitz-Gerald, Marc Faber, market crash, Markets, mining companies, Moving Averages, natural gas, oil, palladium, Peter Schiff, physical gold, platinum, platinum miners, precious metals, Precious Metals Investments, price, price manipulation, prices, producers, production, protection, rare earth metals, recession, risk, run on banks, safety, Saudi Arabia, Sean Rakhimov, silver, silver miners, socialism, sovereign, spot, spot price, stagflation, Stimulus, TARP, Technical Analysis, timber, U.S. Dollar, volatility, volatility index, warrants, Water

    Curious?… to find out what I am talking about? Read On… Congress shouldn’t be allowed to do this! Not only am going to include the TIME magazine article, I am including the actual link to the bill itself, the press release version. The coming runaway Inflation Train and what to do to protect yourself! Read Below…Good Investing! – jschulmansr

    *********************************************************************

    First Here are the links…

    The American Recovery and Reinvestment Bill of 2009

    The American Recovery and Reinvestment Bill of 2009 Press Summary

    *********************************************************************

    A Guide to Reading the America Recover and Reinvestment Bill- TIME MAGAZINE

    Source: Time Magazine

    Brendan McDermid / Reuters

    Brendan McDermid / Reuters

    “Madness is to think of too many things in succession too fast, or of one thing too exclusively” — Voltaire

    The American Recovery and Reinvestment Bill of 2009 should be required reading for every citizen from billionaires to the average person. It was issued by The Committee On Appropriations and is the road map for the $825 billion that the Congress and Administration intend to put into the U.S. economy to jumpstart the economy out of the recession.

    The most important part of the document may be the description of how the country was dragged into the worst economic period in its history. ( See pictures of the Top 10 scared traders.)

    At the beginning of the bill, the authors write: “Since 2001, as worker productivity went up, 96% of the income growth in this country went to the wealthiest 10% of society. While they were benefiting from record high worker productivity, the remaining 90% of Americans were struggling to sustain their standard of living. They sustained it by borrowing … and borrowing … and borrowing, and when they couldn’t borrow anymore, the bottom fell out.”

    If that analysis is true, then two other things must be accurate. The first is that the cause of the recession was Americans becoming overextended in their use of credit. The other one, which is a consequence of the first, is that if the government can facilitate future consumer borrowing, the economy will be righted again in short order. That would mean that more complex methods of solving the problems of the recession, such as spending money on infrastructure, would be unnecessary. It would be simpler to take $825 billion and make it available for home equity loans, enlarge credit card lines, and auto loans.

    But, the authors of the bill are not willing to follow their own logic, so they have crafted another plan. The first assumption of what the program will do, and among the most important of its goals, is only mentioned in passing. “This package is the first crucial step in a concerted effort to create and save 3 to 4 million jobs.” This is a little twist on what is being said in public.

    The general assumption about job creation under the program is that it will add 3 to 4 million jobs. But in the introduction to the bill the assumptions about job loss are laid out quite clearly: “Credit is frozen, consumer purchasing power is in decline, in the last four months the country has lost 2 million jobs and we are expected to lose another 3 to 5 million in the next year.”

    The mathematics of the two sets of employment analysis taken together would show then that no new jobs would be created. The three million or so jobs which will be lost in 2009 will simply be replaced by three million new ones. The jobs lost late in 2008 will not be replaced in this program, leaving a two million job deficit Joblessness will stay at about 7.2%

    Other than those details, the money will be well spent.

    The states need help, and the federal government means to provide it: A sum of $79 billion in state fiscal relief will be provided to prevent cutbacks to key services

    After the plans to help the states, cut taxes, and provide new infrastructure for the nation, the programs get a little off track.

    The bill means to spend $44 million to repair the U.S. Department of Agriculture’s headquarters. About $400 million will go to repairing national monuments in Washington, which are somehow considered essential to national infrastructure.

    Additionally, Congress plans to pay out $200 million to provide financial incentives for teachers and principals to do their jobs better. Another $100 million will be used to establish a set of grants to provide $100 to local governments and nonprofit organizations to remove lead-based paint hazards in low-income housing.

    Perhaps the best investment in the bill is for $80 million to ensure that worker protection laws are enforced as recovery infrastructure investments are carried out. In other words, there will be a police system set up to make sure that no one with a new job working on national infrastructure with money provided by the government will have his or her rights violated.

    The bill calls for over one hundred programs which Congress plans to enact. These include addressing problems as diverse as community block grants, upgrading the forestry service, bridge removal, and NASA research funding. The remarkable thing about the legislation is that almost every program is ill-defined and subject to broad interpretation and a wide variation as to how it might be enacted.

    In a sentence, The American Recovery and Reinvestment Bill of 2009 will have to build a bureaucracy larger than any ever created by the US government in order to manage its many parts.

    The first sentence of the bill reads “The economy is in a crisis not seen since the Great Depression.” If it requires all of these plans to get America back on the road to recovery, the process will take a decade.

    — Douglas A. McIntyre

    See pictures of the global financial crisis.

    For constant business updates, go to 24/7wallst.com.

    =========================================================

    *** My Cure for the coming runaway inflation train? Read below…

    =========================================================

    Gold Will Shine Again in 2009 – Seeking Alpha  Part 1

    By: Sean Hyman of mywealth.com

    I think this one may be a shocker to many…that gold is going to be much higher at the end of 2009 than it is right now. I think it will take out its highs just above $1,000 an ounce and will head for at least $1,250 an ounce. (Gold is presently trading around $853 an ounce.)

    When I was a stock broker, I hated gold. To me it was the dumbest investment on the planet. Of course I worked as a broker when gold was in a multi-year bear market.

    But the more that volatile booms and busts have caused the need for more government intervention, the more of a believer I’ve become in gold.

    Let’s look at several of the dynamics that have helped to form my view for gold in 2009.

    South Africa is home to some of the biggest gold mines in the world. In 2008, their gold output shrank as exploding input costs caused them to close some of their most expensive mines. (Produce less of the metal and the speed of the supply shrinks which helps to support the price.)

    This has been one dynamic that has helped to support prices in 2008 and that has kept gold in an 8 year bull market. Even in 2005 and 2008 when the dollar rallied, gold still held its ground. This shows a lot of strength for the metal since the dollar and gold largely trade somewhat opposite of each other (being that gold is denominated in dollars and when the dollar is rising, it tends to calm the fears for the currency which typically dulls the demand for the precious metal).

    In fact, had it not been for tons of hedge fund failures and liquidations, I think gold would actually be much higher than it is right now.

    Helicopter Ben & Obama will do their part to help gold out!

    With the credit crisis in full swing, the Fed has responded by turning on the printing presses at full speed. This enormous increase in the money supply (which is temporarily clogged up in the banks) will eventually be unleashed on the economy. Once this happens, you will quickly see deflation erased and we may actually move into a period of hyper-inflation.

    Why would I go so far as to think that? Heck, the Obama administration may print as much as a few trillion dollars to help out the banks according to former central banker Volcker.

    We’ve also got another stimulus package coming within weeks according to the Obama administration.

    Another reason why I feel that a huge bout of inflation will return is because of interest rates. If you’ll remember, Congress got pretty harsh with Alan Greenspan for taking rates down to 1%. They even went so far as to accuse him of causing the recent bubbles in the economy, which he denies.

    Well, if the “1% cheap money” inflated things into the stratosphere, what do you think will happen with Ben Bernanke’s interest rate range of 0% to 0.25%? Could you say it would have any less of an effect? No, it will have an even greater “bubble effect” in time as the cheap money actually is released out into the economy.

    Tomorrow, I’ll continue with “Part 2” of this “gold story”… So stay tuned!

    Gold Will Shine Again in 2009 Part 2

    by Sean Hyman

    Get ready for the “economic pipes” to be unclogged and for a tidal wave of inflation to head our way!

    I assure you that Obama’s economic advisors will be the “drain-o” that gets the pipes unclogged. When this happens, the Fed knows that it will have to “mop up” this excessive liquidity in the financial system.

    However, here’s what I predict will happen: The Fed, while it wants to be a forecaster of the economy really just ends up becoming a “responder” after the fact to what’s going on in the economy. Therefore, between the time that the Fed starts to see the inflationary signs in the economy and starts the process of draining the excess liquidity from the economy, it will be too late. The hyper inflationary effects will already be in play. They will be “late to the ball game” yet again.

    When all of this starts to happen (and possibly a bit beforehand), savvy gold investors will sense it coming and will buy up gold ahead of time…positioning themselves like a surfer that gets out ahead of the coming wave that will propel him forward.

    The Fed will do its best at that point to drain the money supply and hike rates, but there are delays from when they start to act and when it actually starts to effect the economy. This “lag time” will cause a huge return of inflation in a big way that will propel gold ever higher and will eventually dilute the dollar as well.

    You see, when there’s more of something in existence, it begins to hold less value. So as the money supply is quickly increasing, the dollar will eventually feel the effects of it. Remember, there’s that delayed “lagging” period which is why it hasn’t already been felt even now.

    However, as sure as the sun is coming up tomorrow…it’s coming. So get prepared ahead of time. For, the key to successful investing is to buy just ahead of the massive move. This requires an investor to “think ahead”. You can’t just see what’s happening at present and prosper like you should in your investing. It requires one to be “forward looking” and thus “forward thinking”.

    When all of this unfolds, investors will buy gold (which is essentially exchanging their dollars for gold) as they seek safety, liquidity and an “insurance policy” against runaway inflation.

    Gold production will continue to shrink and Central Banks will hold onto their gold in 2009!

    So with the economy deeply damaged, unemployment claims hitting almost 600k as of this writing, there’s not going to be a huge incentive for investors to sell gold. That’s why gold has only come off of its top by 17.9% and stocks have been 40+% off of their highs on average. You can see its underlying strength just in that fact alone.

    Also, remember that gold supplies will continue to tighten in 2009 just as they did in 2008. Why? Africa’s production of gold sank 14% which was the lowest levels since 1899. That’s serious! But it’s not just a South Africa story. U.S. gold production fell 2% last year. While China (which has now become the world’s biggest producer of gold) had their production rise 3% last year, the “net” result collectively among all countries is a net slowdown in gold production.

    Central bank selling in gold was down a full 42% last year. And you’d be an idiot of a central banker to sell a bunch of gold in 2009 with the U.S. and global economy still hobbling along. Therefore, you can count on these guys not adding to the selling.

    Therefore, get ready to buy gold, sell dollars and buy foreign currencies like the euro and especially the Aussie dollar which is greatly helped by rising gold and other commodity prices.

    Most of the increase in gold and selling of dollars may come more in the 2nd half of the year than the 1st half due to the delayed effect of Fed policy and as the Obama administration starts to get its feet wet in tackling the economic woes.

    But be aware and watch for the change just in case it happens even a bit sooner than I think.

    Gold consolidates its multi-year gains as it catches its breath and prepares to run “ever higher” in 2009!

    =========================================================

    2009 Gold Outlook

    2009 Gold Outlook

    How To Invest in Gold in 2009

    By Luke Burgess
    Monday, January 5th, 2009

    The investment markets are yielding to the fact that the global economy will remain weak for the better part of 2009.

    As a result, investors will continue to seek safe havens.

    Under normal conditions, these safe haven investments would include land and real estate. These assets have intrinsic value; or in other words, their value will never fall to zero. But with falling prices, investing in real estate is out of the question for most people right now. And there’s little doubt that investors will look elsewhere for safety against financial crisis.

    The best safe haven asset in the world right now is still gold because it is never considered to be a liability.

    And we believe that safe haven investment demand will drive gold prices during 2009. With this in mind, we would like to present a broad overview of Gold World‘s 2009 gold outlook. But before we get into that, let’s review what happened to gold prices in 2008.

    Gold Was One of the Best Investments of 2008

    In March 2008, gold prices hit a record high of $1,033 an ounce as the gold bull market entered its seventh year of life. This was followed by a normal 18% correction, which drove gold prices back down to $850 an ounce.

    Gold prices subsequently rebounded and were once again closing in on the $1,000 level in mid-July. At the same time, however, the fundamental and psychological effects of the slowing housing and credit markets were just beginning to devalue significantly the investment markets across the board.

    As a result, many long gold positions had to be sold in order to cover losses from investments in other markets. Over the next several months, this forced selling pressure pushed gold prices down.

    Gold prices were also held down during the second half of 2008 as the U.S. dollar enjoyed a +20% rally. Foreign governments, institutions, and banks began buying the U.S. dollar, which despite a legion of problems continues to be the world’s most important reserve currency, as a hedge against domestic economic turmoil.

    20090105_2009_gold_outlook.png

    These factors contributed to a significant drop in the price of gold, which officially bottomed out for the year at an intraday low of $683 an ounce in October 2008.

    Gold prices have subsequently bounced off of the $700 level as major selling has dried up, and fresh buying has come into the market.

    Despite three 20% corrections and serious deflation in the market, gold exited 2008 with a positive 5.4% gain for the year. Although subtle, this gain outperformed every major equity index and commodity in the world. Here are just a few examples…

    Index/Commodity
    Percent Change During 2008
    Dow Jones
    -34%
    NASDAQ
    -41%
    S&P 500
    -39%
    TSX -35%
    TSX Venture -74%
    Oil
    -55%
    Silver
    -23%
    Copper
    -54%
    Gold
    +5%

    This made gold one of the best investments of 2008.

    And the 2009 gold outlook looks just as strong.

    Despite a bit of downside in the immediate future, we expect gold to have a stellar year.

    Global economic turmoil and deflation will undoubtedly continue to influence gold prices in the near-term. A short-term pullback in gold prices from current levels to $800—maybe even a bit lower—before a recovery is not out of the question. However, we expect gold prices to break new records during 2009.

    For our current perspective, we expect gold prices to reach as high as $1,300 during 2009, which would be a profit of over 50% from current levels.

    Gold prices in 2009 will be supported more heavily by supply/demand fundamentals than in the previous years of this gold bull market.

    As we’ve previously discussed, during the third quarter of 2008, world gold demand outstripped supply by 10.5 million ounces. This deficit was worth $8.5 billion and was the largest supply/demand deficit since the gold bull market of the 1970s.

    Official 4Q 2008 world gold supply/demand figures will be calculated and reported later this month. Gold World will report them to you when the data is released.

    In the meantime, though, all estimates suggest that there will be another very large deficit in world gold supplies from the fourth-quarter, with investment demand continuing to drive the market.

    We expect that a continuing surge in investment demand could push gold prices as high as $1,300 at one point during 2009.

    There will likely be a bit more volatility in the gold market in 2009 as more and more speculators come into the market. It is likely that the gold market will experience three or four price peaks (selling points) during 2009.

    How to Invest in Gold for 2009

    As we expect a near-term drop in gold prices as a result of continuing deflation, we are advising our readers to hold off on any physical gold buying for the immediate future. As previously mentioned, gold prices could dip back down to $800 before recovering again.

    Nevertheless, we expect 2009 to be another great year for gold investors.

    Good Investing,

    Luke Burgess and the Gold World Research Team
    www.GoldWorld.com

    ==========================================================

    Tomorrow we’ll check on what’s the latest on the Obama eligibility issue.

    Be Blessed and Remember: Dare Something Today Too!


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    Are We Getting Ripped Off? Latest Bailout and Gold News

    21 Wednesday Jan 2009

    Posted by jschulmansr in agricultural commodities, alternate energy, Austrian school, Bailout News, banking crisis, banks, Barack Obama, bear market, bull market, capitalism, central banks, Comex, commodities, communism, Copper, Currencies, Currency and Currencies, deflation, depression, dollar denominated, dollar denominated investments, economic, economic trends, economy, Federal Deficit, Finance, financial, Forex, Fundamental Analysis, futures, futures markets, gold, gold miners, How To Invest, How To Make Money, inflation, Investing, investments, Latest News, Make Money Investing, Markets, mining companies, mining stocks, Moving Averages, oil, palladium, physical gold, platinum, platinum miners, Politics, precious, precious metals, price, price manipulation, prices, producers, production, rare earth metals, recession, Religion, silver, silver miners, spot price, stagflation, Stocks, Technical Analysis, Today, U.S. Dollar, volatility, warrants

    ≈ 3 Comments

    Tags

    agricultural commodities, alternate energy, Austrian school, Bailout News, banking crisis, banks, bear market, Bollinger Bands, bull market, capitalism, central banks, China, Comex, commodities, communism, Copper, Currencies, currency, deflation, depression, diamonds, dollar denominated, dollar denominated investments, economic, economic trends, economy, Federal Deficit, financial, Forex, futures, futures markets, gold, gold miners, hard assets, heating oil, India, inflation, investments, Keith Fitz-Gerald, Marc Faber, market crash, Markets, mining companies, Moving Averages, natural gas, oil, palladium, Peter Schiff, physical gold, platinum, platinum miners, precious metals, price, price manipulation, prices, producers, production, protection, rare earth metals, recession, risk, run on banks, safety, Saudi Arabia, Sean Rakhimov, silver, silver miners, socialism, sovereign, spot, spot price, stagflation, Technical Analysis, timber, U.S. Dollar, volatility, warrants, Water

    Are We Getting Ripped Off? Read Today’s Post dealing with the Bailout, Gold Price Manipulation and more. I’m back, we have a new President, what does this mean for your investments… Read On and Good Investing! – jschulmansr

    Preventing The Greates Heist In History- Seeking Alpha

    By: Whitney Tilson of Value Investing

    There’s currently an idea to fix the financial system that’s getting quite a bit of traction: an RTC-type program whereby the government would buy $1 trillion of troubled assets from struggling U.S. banks, with the goal of restoring them to health so they can begin lending again, leading to an economic recovery.

     

    The problem with this idea (let’s call it “New RTC”) is that either the government will pay market prices for the toxic assets – in which case, it will simply accelerate the collapse of our financial system – or pay above-market prices, in which case taxpayers will likely suffer big losses.

     

     

    De-Leveraging Is Not Deflation-Seeking Alpha

    By: Paco Ahigren of Ahigren Multiverse

    “Inflation, as this term was always used everywhere and especially in this country, means increasing the quantity of money and bank notes in circulation and the quantity of bank deposits subject to check. But people today use the term `inflation’ to refer to the phenomenon that is an inevitable consequence of inflation, that is the tendency of all prices and wage rates to rise. The result of this deplorable confusion is that there is no term left to signify the cause of this rise in prices and wages.”

    — Ludwig von Mises

    It’s true that just about every asset class is coming down in price right now. This, however, is not deflation — as I have said so many times recently, much to many readers’ unqualified chagrin. To the contrary, these declines are the products of de-leveraging — not deflation — and the distinction is nearly incalculably important, although the subtlety seems to elude even the most astute these days.

    If the previous premise is true (which it is), any removal of money from the economy would eventually result in an increase in the value of our currency, relative to everything else. And that, in turn, would eventually translate into lower prices in dollars. But that’s clearly not what is happening. No, the Fed is printing money, sending the amount in the economy higher than ever seen in U.S. history. That’s not deflationary. That’s inflationary.

    Just so you’ll know, here’s the definition of inflation I’m using. And before you pooh-pooh it with too much eagerness, remember that one of its authors, F.A. Hayek, won the Nobel Prize in economics in 1974.

    Look, the thing we should be worried about is relative value, not “inflation,” per se. It’s not about the growth of M0, or M1, or M2 (or even M3, if you keep up with shadowstats.com), so much as it is about what the money supply is doing relative to everything else that is happening. I know assets are falling in price — believe me, I get no shortage of reminders every single day. But the amount of money in the system — not just M0 — is increasing at a tremendous rate. I won’t argue that the relative value of things like real estate and equities are going to continue to drop — maybe even dramatically, and for a long time — in terms of demand (or lack thereof). No, what I’m most concerned about is that demand will stay extremely low, and yet prices will rise anyway because of the increase in the amount of money in the system.

    But it’s not just money; it’s also Treasuries. The Fed has specifically stated that its objective is to stimulate “inflation” (by its definition). It wants prices to rise, and it’s going to do everything it can to find success. But the amount of money in the system is unprecedented. When the Treasury bubble starts to collapse, yields are going to explode. Yes, the Fed will probably print more money to buy down the long-end of the curve, but how long will that work? Some people say years, but how? Do you really think the Chinese and the Japanese are going to keep funding that sort of behavior? Or even more importantly, do you think they’re just going to sit on their current holdings? Probably not, and if they start dumping Treasuries, yields are going much higher.

    It’s not a matter of if this is going to happen. Yields can’t stay where they are for any sustained amount of time, and once they start rising, so will prices. But will demand for, say, houses have increased? No. Cars? No. Boats? Televisions? No. Why? The American consumer is tapped out.

    Credit card companies are tightening limits prodigiously. Teaser rates are all but gone. Home equity has dried up. The consumer has driven two-thirds of our economy for at least the last few decades, and now the consumer is dead. There’s another aspect to this that I won’t go too deep into: the American consumer protects his or her credit score for one reason — to obtain future credit. But the consumer also knows that loans have dried up — not just today, but for the very distant future as well. You know these consumers have to be thinking about defaulting; if they can’t get loans anyway, why would they not default on thousands of dollars in unsecured credit card debt? I plan on writing more about this in future articles, but suffice it to say, I think credit card companies are going to give us the next blow to our collective stomach, and it’s going to hurt.

    So here we have a situation in which demand is gone, and yet prices and rates are rising — because of inflation (printing money) and the Treasury collapse. And that’s the point: it’s not going to come from just one source. It’s not just going to be inflation (printing money). It’s not just going to be the collapse in Treasuries. It’s not just going to be the nearly unfathomable costs of the stimulus packages that are coming online in the next two years. It’s going to be the confluence of all of it. And if I’m right about the continued deterioration in credit markets, things will be even worse.

    You think it’s not different this time? Add it all up, in real dollars — the staggering amount of debt, the parabolic rise of currency in the system, the annihilation of real-estate investment, and the demise of the consumer. $8.5 trillion committed to bailouts and stimulus packages. Oh, yes it is different this time. It’s very different.

    Credit cards didn’t even exist in 1930, and the dollar was backed by gold. Credit cards barely existed in 1973. Nixon had just taken us off the gold standard, and look what happened? Volcker was immensely lucky to have stopped hyperinflation, and look at the extreme measures he had to employ to do it.

    Of course, every time I bring all of this up — which is a lot lately — somebody starts talking about the velocity of money. And pretty soon after that, somebody starts talking about the multiplier effect.

    Yes, the U.S. employs a fractional reserve system, and while that system certainly lends to rising prices and yields, the amplifier effect is not inflation. Like the printing of money, the fractional reserve system is only one ingredient in the poison that lends to the ultimate catastrophe inspired by central banks: rising prices and increased costs of borrowing.

    And then there’s velocity…

    While I am eternally grateful to my critics for forcing me to defend the theories I hold dear, I sometimes fatigue of the incessant snapping at my heels by people who want me to know that the velocity of money has slowed down. I know the velocity of money has slowed. It doesn’t matter. It’s not going to stay this low for long, and when it starts speeding up, it’s not going to be a “good thing.” Treasuries are going to break, rates and prices are going to rise, and all that money pressing against the dam is going to find a crack. Why? It has to. People will flee from dollars that are losing value. They will extract all the dollars sloshing around the system, and they will buy commodities and durables in order to preserve the value of their wealth.

    Remember, just because the dollar is losing value does not mean that the concomitant subsequent rise in certain asset classes necessarily means that demand for all assets has increased dramatically — as it did during previous eras of easy money. Demand for assets economy-wide can continue to wane even as people spend dollars as fast as they can get them in the midst of rising prices. And this is a very important distinction: prices can rise because of demand, but prices can also rise because of excessive increases in the amount of money in the system. If prices are rising without a simultaneous increase in demand, well, I can’t think of a more dangerous economic environment to be in.

    You don’t believe it can happen? You think there’s a huge demand for houses, cars, and boats in Zimbabwe? Prices there are rising exponentially, but there is very little demand for assets — other than staples, of course. What do you think their velocity of money is?

    The other day I wrote that Treasuries and the dollar are not “safer” than gold, and for my efforts I was heckled by several readers. Ultimately, however, flight-to-quality will seek the true risk-free rate of return, and this is yet another factor that will contribute to the imminent ferocity of the move that’s coming. Once Treasuries unwind, people and institutions will scramble to find a place to put the money they had once placed in the “safety” of U.S. government debt. And unless you know of a medium whose historical consistency and safety surpasses gold’s, that will be the place investors find haven.

    Just for future reference: when I say the dollar’s going to fail (which it is), and you’re hovering over your keyboard, poised like some bird-of-prey, ready to strike me with all the ire of God-upon-Sodom, will you try to remember that I acknowledge velocity is, at least for the time-being, near zero. Will you also try to remember that I don’t believe the massive increase in currency alone will not be responsible for imminent rising rates and prices? In fact, I think Treasuries are going to play a greater role in the beginning.

    Also, I agree with many of you that my timing may be a bit premature, and I exited my TBT after the last run-up. Unfortunately, today the stock market and Treasuries are getting crushed as gold rallies. I wouldn’t want to declare myself “right” based just on the behavior of these markets in recent days. That would be stupid. And yet I sit here and watch TBT move higher, wondering if getting out was even more stupid.

    To add to my trepidation, some sort of manager in the South Korean finance ministry came out over the weekend and announced that the time has come to sell U.S. Treasuries. How do you think that made my stomach feel? Of course, Bernanke keeps promising to do battle with the long end of the curve, so maybe he’ll make good on his threat and I can find a point to get back in comfortably.

    Of course, if I miss the move because I listened to some of you cynics. Well, at least I still own gold.

    Disclosures: Paco is no longer short U.S. Treasuries (although he hopes to be again soon). He is long physical gold, and the Proshares Ultra long gold ETF (ticker: UGL).

    Copyright 2009, Paco Ahlgren. All Rights Reserved.

    ================================================

    On Gold Price and Market Manipulation 

    Questions Begging Answers- GoldSeek.Com

    By: Rob Kirby of Kirby Analytics

    To say that markets have been behaving “strangely” recently is an understatement.  In recent weeks and months we’ve been witness to historic lows in sovereign interest rates in-the-face-of record amounts of debt being issued by governments?  We’ve seen the price of gold behave counter intuitively by “not rising” in-the-face-of unprecedented systemic global economic malaise?  Last, but not least, we’ve witnessed a “complete flip-flop” in the traditional pricing of Brent Crude Oil [IPE-London] versus West Texas Intermediate [NYMEX-N.Y.]?  

     

    So we have the price of gold, the price of crude oil and interest rates – three items vital to the integrity of the U.S. Dollar – ALL trading in total disregard for their underlying fundamentals?

     

    The following is a thought provoking analysis with commentary:

     

    The Situation In Gold

     

    First and foremost it is imperative that everyone realize and understand that Gold “is” Money.  We know that gold is money because every Central Bank in the world carries gold on their balance sheets as ‘an official reserve asset’.

     

    With that in mind, folks would do well to read one of James Turk’s latest articles titled, The Fed’s blueprint for market intervention .  In this article, Turk offers commentary on a recently unearthed 1961 document from the archives of the late, long-time former Chairman of the Federal Reserve, William McChesney Martin Jr. which details in the Fed’s own pen; their plans to intervene surreptitiously in the currency and gold markets to support the dollar and to conceal, obscure, and falsify U.S. government records so that the intervention would not be discovered.  In Turk’s words,

     

    “In short, [the newly unearthed document] lays out what the Treasury and Federal Reserve needed to do in order to begin intervening in the foreign exchange markets, but there is even more. This document plainly shows what happens when government operates behind closed doors. It also makes clear the motivations of the operators of dollar policy long described by the Gold Anti-Trust Action Committee and its supporters — namely, that the government would pursue intervention rather than a policy of free markets unfettered by government activity. The run to redeem dollars for gold had put the government at a crossroads, forcing it to make a decision about the future course of dollar policy. This paper describes what the government would need to do by choosing the interventionist alternative.

    This document provides primary, original source supporting evidence that GATA has been right all along.” 

     

    In Feb. 2007 here’s what the Royal Bank of Canada’s Chairman, Tony Fell had to say, confirming unequivocally that gold is money,

     

     

    “At Royal Bank of Canada, we trade gold bullion off our foreign exchange desks rather than our commodity desks,” says Anthony S. Fell, chairman of RBC Capital Markets, “because that’s what it is – a global currency, the only one that is freely tradable and unencumbered by vast quantities of sovereign debt and prior obligations.
    “It is also the one investment and long-term store of value that cannot be adversely impacted by corrupt corporate management or incompetent politicians,” he adds – “each of which is in ample supply on a global basis.”

     

    In short, says Fell, “don’t measure the Dollar against the Euro, or the Euro against the Yen, but measure all paper currencies against gold, because that’s the ultimate test.”

     

     

     

     

     

    Fell’s admission coupled with the recently unearthed account of the Fed’s game plan shows that gold “is” and always has been feared as competition for the U.S. Dollar and a game plan has long been in place to thwart it.  This explains why economic data has been falsified and the price of gold has been surrepticiously managed and interfered with by the United States Treasury and the Federal Reserve.

     

    The mounting evidence is this regard is so compelling that from this point forward any ‘economist’ attempting to explain our current situation without prefacing their explanation with an EXPLICIT ACKNOWLEDGEMENT that our capital markets are not free and are in fact RIGGED by officialdom – their analysis is not worth the time to read it.  In this regard, perhaps never have more prescient words been uttered than GATA’s Chris Powell in Washington in April, 2008 – when he opined, There are no markets anymore, just interventions.

     

    The recent decoupling in price of gold as measured by the spread between the futures price and the cost to obtain physical ounces is a stark reminder that smart money is beginning to repudiate fiat money by seeking tangible ownership of goods perceived to posses value instead of derivative ‘promises’ to deliver the same.

     

    The Oil Picture

     

    Back in June, 2007, Market Watch reported,

     

    Normally, Brent crude costs $1-$2 less than WTI crude, according to James Williams, an economist at WTRG Economics. At its peak, the price spread between the two topped $5, according to his data.

     

    The article went on to explain,

     

    WTI usually trades at a premium to Brent “because of the slightly higher quality, and the extra journey” oil tankers have to take to get the oil to the U.S., according to Amanda Lee, a strategist at Deutsche Bank. So “WTI minus dated Brent should be roughly equal to the freight rate,” she said. Indeed, “crude-oil prices usually depend on two things: quality and location,” said Williams. “The greater the distance from the major exporters, the greater the price.”

     

    But here’s what’s happened recently in the global crude oil market:

     

     

     

     

     

     

    Brent Crude trading at a 7 Dollar premium to West Texas Intermediate is like the SUN rising in the west and setting in the east – and no-one asking any questions why?

     

    Thanks to the unearthing of the Fed’s Playbook Document, referenced above, along with cumulative knowledge of the existence of the President’s Working Group On Financial Markets [aka the Plunge Protection Team]; we know that interference in strategic markets with national security implications is now practiced commonly by the Government and the Fed working together.  No other explanation for this distortion is plausible other than NYMEX regulators like the Commodities Futures Trading Corp. [CFTC – Plunge Protection Team members] are more brazen and actively complicit in market rigging of strategic commodities than their London counterparts. This manipulation is all being done in desperation; to preserve U.S. Dollar hegemony by perpetuating the illusion that inflation is being held at bay.  Ample anecdotal evidence exists in a host of articles – particularly relating to derelict CFTC oversight of COMEX gold and silver futures – archived at kirbyanalytics.com to support this position.

     

    Spiking VLCC Rates Reflect “The Movement to Tangibles”

     

    The “unusual” premium for Brent Crude is even more perplexing given that crude oil shipping rates [unlike their dry goods shipping counterparts, as depicted by the Baltic Dry Index] for VLCCs [very large crude carriers] have, as recently as Dec. 2008, been enjoying robust and improving charter rates,

     

     

    Last week the spot rate for Suezmax tankers was in the low $40k per day range. Yesterday, I check the rates and they have popped to over $90k this week! VLCC (very large crude carriers, i.e. supertankers) rates have not jumped as much but appear to be following the trend. So what is the deal here? Oil prices are falling and so is the apparent global demand for oil. Are not oil tankers just sitting around idle like the dry bulk carriers?
    The answer is somewhat counter intuitive. The spike in spot tanker rates is actually the result of the low oil prices. Many tankers are being leased on the spot market as storage tanks. Oil producers, for whatever reason, do not want to significantly slow their oil production, but at the same time do not want to sell it for $45 a barrel. So they are leasing tankers to store oil in the hope or belief that oil prices will recover shortly. Two names in news articles that I have read doing this are Royal Dutch Shell and Iran. The majority of the planet’s oil production is owned by national oil companies that have policy and employment as well as financial reasons to keep the oil flowing. So at least in the short term, the current low oil prices are a boon for tanker owners.

     

    Oil tanker companies, like their dry cargo brethren, can sign their ships to either long term, multi-year leases or charter them on the spot market where they are leased for a single voyage at the current spot rate.

     

     

     

     

     

    The fact that “smart money” is now paying elevated prices to lease very large crude carriers [to store physical crude for later sale] is further evidence that faith in fiat money is waning simply because – you can do the same “trade” on paper – utilizing futures – without the bother and nuisance of leasing ships and handling the physical.  Ask yourself why smart money has recently become engaged in buying ‘relatively illiquid’ physical crude oil, in a world allegedly awash in the stuff, for resale at a later date – instead of playing futures, accepting promises and holding cash?

     

    Smart money is in the process of losing confidence in cash.

     

    Interest Rates

     

    It is vital that everyone understand that the function of interest rates in a system of usury is to solemnly act as the efficient arbiter of capital – rising to restrict money / credit growth when the economy overheats and falling to create the opposite when the economy cools.

     

    Interest rates no longer serve this function.

     

    As deceitfully disastrous as the surreptitious interventions in the crude oil and gold markets has been – they pale in comparison to the travesty which has been perpetrated through the premeditated hobbling of usury. 

     

             

     

    The roots of this most wicked experiment are traceable to the appointment of Alan Greenspan as Chairman of the Federal Reserve and then to academia – Harvard – where Robert Barsky and Lawrence Summers co-authored an academic research paper in the 1980s titled, Gibson’s Paradox and the Gold Standard.  The “elevator speech” of what the paper examined was the co-relation between bond prices, inflation and the price of gold and, by extension, theorized that interest rates could be driven down [or kept low] – without sacrificing the currency – in the face of and despite profligate monetary policy so long as gold prices declined or did not rise.

     

      

     

    After a stint as Chief Economist at the World Bank, Mr. Summers brought this “theory” to Washington mid-way through the first Clinton Administration [late1993] as Under Secretary of Treasury to Robert Rubin where he began laying the groundwork – with co-conspirators Greenspan, Rubin and Clinton – for the implementation of his “theoretical research”:

     

     

     

    Gold price suppression began in earnest concurrently with changes in how the Office of the Comptroller of the Currency [OCC] begins records the mushrooming growth of derivatives [mostly interest rate swaps which – absent end user demand – only create artificial demand for government bonds]:

     

     

     

    The Federal Reserve acting in cahoots with the U.S. Treasury utilizing the futures pits in N.Y. [COMEX] and the obscenity that has become J.P. Morgan’s Derivatives Book – the Fed / Treasury combo seized control of both the gold price and interest rates.  The mechanics of how interest rate swaps were utilized to suppress interest rates is chronicled and explained in detail at Kirbyanalytics.com in a paper titled, The Elephant in the Room.

     

    Subscribers are reading about the logical implications, and what comes next, as a result of the market manipulations outlined above as well as actionable suggestions to help insulate your investment portfolio from the inevitable fallout.

    ====================================================

    Gata’s Tenth Anniversary: Gold Manipulation Evidence Mounts-Gold Seek.Com

    By: Bill Murphy of LeMetropole Cafe 

    “Faced with the choice between changing one’s mind and proving that there is no need to do so, almost everyone gets busy on the proof.” … John Kenneth Galbraith

    “An error does not become truth by reason of multiplied propagation, nor does truth become error because nobody sees it.” … Mahatma Gandhi

     

     

     

    GO 

     

     

    GATA!
     

     

     

     

    This week marks GATA’s tenth anniversary of our efforts to expose the manipulation of the gold market. In another few weeks we will mark the tenth anniversary of my appearance on CNBC (interviewed by Ron Insana) … the first and last GATA appearance on the US TV media to date … for once they heard what GATA had to say, we have been blackballed ever since. It also marks a shameful period for the US financial market press, which is now clamoring for answers as to how we ever got in the financial market/banking mess we are presently facing. For that answer they ought to first look at themselves and their dismal way of kowtowing to the rich and powerful, and banning those who are willing to challenge the Orwellian grip on what Americans are allowed to hear and know.

    America is facing quite a dichotomy at the moment. We are on the Inaugural Eve of our first black President, with all the hopes and dreams he is envisioning for our country. At the same time we are enduring the most horrific financial crisis since the Great Depression.

    President-elect Obama, a superb orator, is calling for Americans to pull together to effect the CHANGE he called for in his campaign, and for all of us to contribute individually to make that change happen. He has wisely warned of the tough times ahead while going all-out to ready policies ASAP which he believes are the correct way to remedy the growing economic problems of the day.

    He has also assembled an economic team of advisors which are acclaimed and generally very highly regarded … including Robert Rubin, Lawrence Summers, Timothy Geithner and Paul Volker. Unfortunately for the GATA camp, they are the ALL-PROS of the gold price suppression scheme. It is almost like our worst nightmare. On paper it represents anything but change as far as US gold policy is concerned, and has the potential to make our investment lives miserable for years to come. After all…

    *Robert Rubin coined the phrase “US Strong Dollar Policy,” and flaunted the phrase. Rigging the price of gold was that policy’s lynchpin. What else was there? Steve Forbes was on Fox News Saturday talking about how important he believes it is for America to MAKE the dollar strong again. He talked sheepishly about gold in vague terms and referred to Rubin.

    Robert Rubin hatched the gold price suppression scheme while running Goldman Sachs’ operations in London. This was many years ago, when interest rates were very high (say from 6 to 12% in the US). Rubin had Goldman Sachs borrowed gold from the central banks at about a 1% interest rate. Then he sold the gold into the physical market, using the proceeds to fund their basic operations. This was like FREE money, as long as the price of gold did not rise to any sustained degree for any length of time.

    He continued his innovative money ploy as CEO of Goldman Sachs in New York and then put his Strong Dollar Policy ploy on steroids as Treasury Secretary under President Clinton.*Lawrence Summers followed Rubin as Clinton’s Treasury Secretary, and who could be more qualified to continue Rubin’s gold price suppression scheme than him? After all, while at Harvard he co-authored a paper, “Gibson’s Paradox and The Gold Standard.” The bottom line of Summers’ analysis is that “gold prices in a free market should move inversely to real interest rates.” Control gold and it will help to control interest rates.

    Obama has designated Mr. Summers to be the Director of the U.S. National Economic Council.

    *Which brings us to Timothy Geithner, who is President-elect Obama’s nominee to be U. S. Treasury Secretary. Geithner was named president and chief executive officer of the Federal Reserve Bank of New York on November 17, 2003. In that capacity, he serves as the Vice Chairman and a permanent member of the Federal Open Market Committee, the group responsible for formulating the nation’s monetary policy.

    Mr. Geithner joined the Department of Treasury in 1988 and worked in three administrations for five Secretaries of the Treasury in a variety of positions. He served as Under Secretary of the Treasury for International Affairs from 1999 to 2001 under Secretaries Robert Rubin and Lawrence Summers.

    Geithner is also happens to be a member of the Bank for International Settlements and since 2005 has been Chairman of the Committee on Payment and Settlement Systems. You might want to see what The CPSS undertakes “at their own discretion” as listed here:

    http://www.bis.org/cpss/index.htmLike outgoing Treasury Secretary Hank Paulson, Tim Geithner is a graduate of Dartmouth College. Talk about knowledge of the gold price suppression scheme!

    *And then there is the venerable Paul Volcker, who so effectively brought down runaway inflation in the US, starting in 1980. His one regret:

    “Joint intervention in gold sales to prevent a steep rise in the price of gold (in the 1970s), however, was not undertaken. That was a mistake.” … Former Federal Reserve Chairman Paul Volcker (writing in his memoirs).

    All-Pros? All-World is more like it when it comes to devotees of suppressing the price of gold. Outside of Volcker, the other three are those most responsible for making it happen in the first place.

    So what’s the point? To get us all depressed over what lies ahead? NO, just the opposite.

    On December 18th, on GATA’s behalf, I met with Bart Chilton, a CFTC commissioner who showed interest in hearing what we had to say. There were three others from the CFTC in attendance, including Elizabeth L. Ritter, Deputy General Counsel of that organization.

    From my MIDAS commentary later in that afternoon…

    Bart listened intently and took notes, as did one of the others, and asked numerous questions. Basically, I laid out our GATA presentation as I explained in the Sunday Midas. I am not going to get into all the details of what they said, as we will see what takes place in the months to come … except to say that I chuckled when saying to them if they really wanted to comprehend what the real gold price suppression scheme is all about, all they have to do is go to their new proposed Chairman … at the right time. No one knows what is going on better than he does.

    (Insert- Gary Gensler was nominated that day to be the new chairman of the CFTC. Gensler was Undersecretary of the Treasury (1999-2001) and Assistant Secretary of the Treasury (1997-1999).

    Gensler spent 18 years at Goldman Sachs, one of the ringleaders of The Gold Cartel, making partner when he was 30, becoming head of the company’s fixed income and currency operations in Tokyo by the mid-90’s.

    As the Treasury Department’s undersecretary for domestic finance in the last two years of the Clinton administration, Gensler found himself in the position of overseeing policies in the areas of U.S. financial markets, debt management, financial services, and community development. Gensler advocated the passage of the Commodity Futures Modernization Act of 2000, which exempted credit default swaps and other derivatives from regulation.

    Could The Gold Cartel have recruited a better ALL-PRO/ALL-WORLD man for their team? It is also important to keep in mind that chairman of the CFTC is one of the four members of the President’s Working Group on Financial Markets. Now why does a bureaucrat need to participate with the President and US Treasury Secretary on the markets? I thought the CFTC was supposed to regulate them, not be a part of policy.)

    I did not hold back and said the main culprit of The Gold Cartel was our own government (their own boss), who has been in league with bullion banks like JP Morgan Chase, and others, to suit their own hidden agenda….

    I was very impressed with Bart Chilton (very sharp guy) and he mentioned that my trip to D.C. would not be in vain.

    ***

    What I stressed most at the meeting was that the gold price suppression scheme would not survive another four years, over the length of Obama’s elected term … and presented lengthy documentation to prove my point … meaning The Gold Cartel would run out of enough available central bank gold to meet a growing annual supply/demand deficit over the next four years. The bottom line was that Obama could stop the gold price manipulation scheme now and allow the price of gold to trade freely, thereby letting the Bush Administration be the fall guy; or he could let his economic team persuade him to carry on the status quo, in which case the price of gold will blow sky high in the years ahead, and he would have to take the blame for the resulting ramifications … especially when the gold scandal becomes a huge public ordeal.

    What better way for Obama himself to understand the true gold situation than to ask his top economic advisors what the real deal is. If GATA is correct, and we have been on target for years, the U.S. has a BIG problem when it comes to its gold reserves (how much of it has been encumbered and is therefore GONE?) That is an essay unto itself, with many variables to be discussed, and for another time. All Obama has to do is get the five above-mentioned gentlemen in a room and get right to the nitty-gritty. They can start with the extensive package I handed to Bart Chilton, who is a member of the Obama transition team, and someone who once worked for Tom Daschle, formerly the Democratic leader in the Senate for ten years, and is now Obama’s Secretary of Health and Human Services nominee.

    What Bart Chilton does with what I gave to him is his business, but since he told me my visit would not be in vain, I assume GATA’s extensive presentation did not go into the dumpster.

    Meanwhile, in GATA’s tenth anniversary year, we are making our own call for CHANGE, and are pressing on. Obama has stated over and over again he wants THE PEOPLE to be represented and asked us to give him input. Who has more pertinent input go get to him than our camp? Therefore, we are asking everyone interested in a free gold market to make a renewed effort to further disseminate our decade’s worth of evidence of gold market manipulation into the public domain by contacting the financial market media and to others in the Obama transition team (if you have any contacts).

    I know how frustrating it has been to get the jaded financial market media to listen to, and then acknowledge, what we have to say, but that was yesterday and perhaps times have changed due to the growing financial market crisis, and yearning to understand how we got here. After all President-elect Obama is urging for “government accountability” and “transparency.”

    This call to arms has been instigated by the dramatic and sudden discovery of an important document buried in the Federal Reserve’s archives by writer and researcher Elaine Supkis. This document is posted on her blog at:

    http://emsnews2.wordpress.com/2009/01/15/1961-top-
    secret-fed-reserve-gold-exchange-report/

    The document, which is marked “Confidential,” is from the papers of William McChesney Martin, Jr., and this collection is held by the Missouri Historical Society. A scanned image of the original document is posted by the Federal Reserve Bank of St. Louis at the following link:

    http://fraser.stlouisfed.org/docs/histor ical/martin/23_06_19610405.pdf

    Most importantly, GATA consultant James Turk has brilliantly dissected this document in an essay titled, “The Federal Reserve’s Blueprint for Market Intervention,” which has been served at The Matisse Table and at www.GATA.org…

    http://www.gata.org/node/7095The title of this confidential report is:

    Confidential – – (F.R.)
    U.S. Foreign Exchange Operations: Needs and Methods

     

     

     

     

    James Turk notes:

    In short, it lays out what the Treasury and Federal Reserve needed to do in order to begin intervening in the foreign exchange markets, but there is even more. This document plainly shows what happens when government operates behind closed doors. It also makes clear the motivations of the operators of dollar policy long described by the Gold Anti-Trust Action Committee and its supporters — namely, that the government would pursue intervention rather than a policy of free markets unfettered by government activity. The run to redeem dollars for gold had put the government at a crossroads, forcing it to make a decision about the future course of dollar policy. This paper describes what the government would need to do by choosing the interventionist alternative.

    This document provides primary, original source supporting evidence that GATA has been right all along.

    I have long hoped that a “confidential” document like this one would eventually emerge. There are no doubt countless more like it, as evidenced by the Federal Reserve’s and the Treasury’s refusal to provide all the documents requested by GATA under its recent Freedom of Information Act request. Maybe those documents will eventually see the light of day too.

    ***

    James makes a key point regarding one of the assertions of this report…

    “The basic purpose of such operations would be to maintain confidence in the dollar.”
     

     

     

     

    James T notes…

    “This statement confirms one of the basic planks of much of the work by me and others that has been published by GATA over the years. The efforts to cap the gold price have one aim. It is to make the dollar look worthy of being the world’s reserve currency when in fact it is not.”

    ***

    This significant report was written some 48 years ago, yet could have been written at any time in the past 10 years during which GATA has discovered blatant manipulation of the prices of gold and silver … as well as noted ludicrous counterintuitive dollar market action, which has been most noticeable in recent days, as our hysterical financial crisis in the US intensifies.

    James Turk’s title says it all: it is a blueprint for the gold price and financial market manipulation so prevalent now. Ironically, there is a common misconception out there that the US is in the financial market mess it is in today because of too much deregulation. To some extent that is very true, as the likes of Secretary Paulson and Gary Gensler urged Congress to allow the US investment banks to increase the allowable debt/credit on their books from 12:1 to 40:1.

    Yet, just as big a problem was the secretive interference in the US financial markets which allowed credit and risk issues to go completely out of control in America … meaning too much secretive market manipulation … and in a hidden way, too much regulation. Had the gold market not been artificially suppressed and allowed to trade freely, the price would have soared these past years, interest rates would have risen dramatically, and there would have not been the reckless investment bank shenanigans that have put our financial system in such peril. Simplistically, it is generally acknowledged that if gold had been allowed to keep up with inflation for the past 28 years, the price would be over $2,000+ per ounce. The GATA camp knows why it is not there RIGHT NOW!

    Had the Plunge Protection Team (Working Group on Financial Markets) not stepped up their constant Hail Mary play activity after 9/11 to drive the DOW mysteriously higher in the last hour of trading on the New York Stock Exchange, the market probably would have broken down much earlier than it did and given the investing public more of a clue that something was wrong, instead of the misleading Stepford Wives drill that “Everything is fine.”

    What is profoundly disturbing about the discovery of this confidential document is it fits in with much grander conspiracy theories than where GATA is coming from. Since this document, based on what has happened, really is a blueprint for market manipulation since 1961, it feeds into the worst fears of those who are constantly on the case about the Bilderbergers, Council on Foreign Relations, Trilateral Commission, and so on. This document to William McChesney Martin, Jr. is EXACTLY what I have been seeing and reporting over the past decade … not that much different than those who pointed out the Madoff Ponzi scheme during the same period of time. To learn that this market deception and manipulation was conceived when I was a freshman in high school is almost beyond comprehension, especially since the Wall Street crowd hasn’t permitted a serious discussion about it ALL THIS TIME! Nor has our government allowed a true independent audit of US gold reserves since the Eisenhower Administration in 1955.

    It also feeds right into the scary notion revealed in a famed President Clinton comment that goes something like … “I didn’t realize I wouldn’t be in control here when I became President.” … meaning there were far more powerful background forces pulling the strings and on how he must operate.

    GATA doesn’t want to go there, but based on this new discovery, it certainly opens up further comments for fair game, even for some of GATA’s Board of Directors. Adrian Douglas (an oil industry consultant who is presently off to Angola) sent the following email to James Turk:

    James,
    Congratulations. This was an excellent analysis. What a stunning document! Real dynamite.

    It got me thinking as to whether the heist they have pulled is bigger than we think. The BIS as we know, and as mentioned in this memo, is the organization that allows for cooperation behind the scenes of the Central banks. We know they went private to prevent any need for public disclosure seeding the opportunity for Reg Howe’s lawsuit. We have plenty of evidence that Central Bank gold holdings have been depleted. We keep saying that the gold is “gone”. But what do we mean by “the gold is gone”? Gold is not like crude oil, expensive wine, even silver… it does not get consumed. It has not “gone”; it has changed ownership. The Central Banks leased out gold to the bullion banks. Now who did the the bullion banks sell the gold to? We know that the bullion banks can’t get the gold back. If the central banks ask for the gold back the bullion banks can declare bankruptcy or settle in cash. How convenient! The Central bank gold has gone into someone else’s hands that are unknown and the loss will eventually be written off. We know that Central Banks are owned or controlled by some of the richest families and/or entities in the world. Is it possible that these “bankers” can benefit from a fiat Ponzi scheme while it can be maintained AND still end up with the gold in which case they can benefit from a return to a gold standard and when the gold standard eventually gets abused and abandoned in the future they will play the whole fiat game over again? It would certainly require cooperation between central banks to pull off such a heist.

    It would be great to have the whole world sitting in a room and ask those who own more than 10 million ozs of gold to raise their hands!

    The crime may be more than manipulating the price of gold to “defend the US dollar” and concealing the evidence from the public. The Cartel may well have aided and abetted embezzlement of the citizens’ gold of the Western world. And who ever has it, they bought it perfectly legally from the bullion banks with fiat currency.

    This seems to make sense because Central bankers and the “elitists” (Rockefellers, Rothchilds, Morgans, Mellons, Carnegies, Vanderbilts etc etc) are not stupid. They must know gold is real money. They can study monetary history too. The fiat money game in this context is a decoy for the theft of sovereign gold.

    It is not without precedent, the great inflationist, John Law, was arrested escaping with a coach loaded with gold and silver!

    Is this a bridge too far in conspiracy theory?
    Cheers
    Adrian

    Which provoked this reply from another GATA Board member, Catherine Austin Fitts (Assistant Secretary of Housing/Federal Housing Commissioner at the United States Department of Housing and Urban Development in the first Bush Administration)…

    Adrian:
    My hypothesis since 2001 is that the NWO is shifting assets out of sovereign governments and shifting liabilities back in. The goal is to reengineer global governance into the hands of private banks and corporations in a manner that dramatically centralizes control. This is why the creation of a genetically controlled seed and food supply, etc.
    To achieve such centralization requires the centralization of the gold and silver stores. Whoever has the gold has the most powerful financial asset. So if you want a new centralized currency, you need a monopoly on gold and silver. I think part of the end game is to shift back to something involving some kind of gold standard.

     

    If you use fiat currency to acquire ownership and control of all the real assets on the planet, then you need a gold standard to make sure you keep them.

     

     

    So, it would not surprise me to see G8 and GATA start to move into alignment, strange as it may sound.
    Catherine

     

    Neither opinions are official GATA viewpoints, but they are intriguing, eye-opening and worth pondering.

    When I met with Bart Chilton I said GATA’s high command is just a bunch of proud Americans who have stumbled across a profoundly disturbing situation. I showed the four CFTC individuals in attendance GATA’s full-page color ad in the Wall Street Journal on January 31, 2008. It was titled, “Anybody Seen Our Gold?” …

    http://www.gata.org/node/wallstreetjournalSome of you are very familiar with this copy in the ad…

    “The objective of this manipulation is to conceal the mismanagement of the US dollar so that it might retain its function as the world’s reserve currency. But to suppress the price of gold is to disable the barometer of the international financial system so that all markets may be more easily manipulated. This manipulation has been a primary cause of the catastrophic excesses in the markets that now threaten the whole world.”

    … and then…

    “Surreptitious market manipulation by government is leading the world to disaster.”

    The DOW was a little below 13,000 at the time. I mean how right could we have been? Yet the US financial market press completely ignored this very visible ad. There was not even a query of what we were talking about and why we would spend $264,400 to make such a warning.

    So now we are fast forwarding virtually a year later and the US financial markets and economy ARE in chaos. If soon to be President Obama really wants CHANGE and TRUTH, we will give him critical input on one way he can effect what he says he is looking to do.

    To increase the likelihood that what GATA has discovered actually reaches him, GATA is asking all who read this, and agree with GATA, to make some small effort to get this commentary to the financial market media in the world, especially the US financial market press.

    That means contacting writers and media outlets such as the Wall Street Journal, Washington Post, Washington Times, New York Times, Forbes, Fortune, CNBC, CNN, Reuters, Bloomberg, the AP, Fox News, Newsweek, Time, etc. In addition, sending this Tenth Anniversary GATA commentary to widely-followed internet bloggers would also be helpful; perhaps stirring up so many out there who are searching for the reasons behind what has happened financially and economically in the US and why.

    In such troubling times, Obama’s coming Presidency has given optimism and hope to many. For that to occur there must be true change, the desires for which have swept him into office. President-elect had some army. And GATA has its army.

    Please take a little time and make just a small effort to help Obama help himself, even if our issue is the last one he is thinking about at the moment. Funnily enough, it ought to be one of the first, as it is one of the most prominent ones which got us into the financial market/economic nightmare we are in today. After all, it is many of the same bullion banks/investment houses our government is bailing out that were so instrumental in the gold price suppression scheme. Our mission is to let him know, via all sources possible, what the heck has happened and continues to go on.

    Bill Murphy
    Chairman
    Gold Anti-Trust Action Committee

    Copyright (c) 1999 – 2009

    Le Metropole Cafe, Inc

    ================================================

    John Doody: A Winning Situation For Gold Stocks- Seeking Alpha

    Source: The Gold Report

    By: John Doody of The Gold Stock Analyst

    Heralded as “the best of today’s best,” John Doody, author and publisher of the highly regarded Gold Stock Analyst newsletter, brings a unique perspective to gold stock analysis. In this exclusive interview with The Gold Report, Doody ponders the efficacy of the Keynesian approach, makes a case for gold equities and explains how the GSA Top 10 Stocks portfolio has outperformed every other gold investment vehicle since 1994.

    The Gold Report: John, you’ve stated in your newsletter, Gold Stock Analyst: “It’s clear the U.S. is going down a Keynesian approach to get out of this recession/depression.” I am curious on your viewpoint. Will the Keynesian approach actually work, or will they need to eventually move over to the Chicago School of Free Markets?

    John Doody: A free market approach of letting the crisis resolve itself would work, but would cause too much damage; we’d probably lose our auto industry, and it would take too much time. As Keynes said: “In the long run we’re all dead,” so the government is trying to get a faster resolution. The Treasury is pursuing his fiscal policy idea of deficit spending. They’re borrowing the money to bail out the banks. When Obama’s plan is implemented, which could be another $700 billion in stimulus, it will be funded with more borrowings.

    Bernanke and the Fed are pursuing a loose monetary policy with a now 0% interest rate. There’s actually no way we can not end up with inflation. This is much bigger than ‘The New Deal’ under Roosevelt. And I think that the market disarray over the last several months has confused investors; but when the markets settle down, it’s clear to me that it will be up for gold and gold stocks.

    TGR: Is there any economic scenario that you wouldn’t see gold going up in?

    JD: Basically, we’re pumping money into the system, but it’s just sitting there. It’s not being put to work, so there are those who think that we are going to enter a deflationary era. But I can’t see that. Some don’t like Bernanke, but I think there’s probably nobody better prepared to be in his role.

    Bernanke is a student of the Great Depression and knows the mistakes the Fed made then, such as forcing banks to upgrade the quality of loans on their balance sheets. His approach is to buy the banks’ low quality loans, enabling them to make new loans. They haven’t done much of the latter yet, which is probably a fault of the Fed not requiring the funds received for the junk to be redeployed, but they ultimately will lend more as that’s how banks make money.

    He knows in the early 1930s we went into a deflationary period of falling prices. For three or four years prices were down about 10% annually. He fully understands the risks of that, one of which is the increased burden of existing debt payments on falling incomes. The debt burden is lighter in an inflationary environment and that’s his target. Long term, he knows he can cure inflation; Volker showed us how with high interest rates in the 1980s. But there’s no sure way to cure deflation, and so Bernanke’s doing everything possible to avoid a falling price level. And I think that, because this is a service-driven economy, companies won’t lower prices to sell more goods—they will just lay off more workers, as we’re seeing now. I don’t think we’ll get the price deflation of the ’30s, and I’m sure Bernanke is going to do everything to prevent it.

    TGR: But aren’t we already in a deflationary period?

    JD: Well, we may be to an extent; you can get a better buy on a car. But, to put it in the simplest terms, has your yard guy lowered his price, or your pool guy, or even your webmaster?

    TGR: Yes, but people opt to do things themselves versus paying other people to do it.

    JD: Maybe, but if they do, it won’t show up in prices—it will show up in the unemployment statistics. So if the yard guy, pool guy or webmaster don’t lower prices and their clients become do-it-yourselfers, the effect will show up in unemployment, not inflation data.

    TGR: So if every major country in the world is increasing their monetary supply, we would expect inflation. Will there be any currency that comes out of this to be considered the new base currency, sort of like the U.S. dollar is now?

    JD: Well, that’s the $64,000 question. We don’t really know and, because there’s no totally obvious currency, that is why the dollar is doing well of late. But the dollar is in a long-term downtrend, in part because interest rates in Europe remain higher than here. Higher interest rates, as you know, act like a magnet in attracting investment money, which first has to be converted to the higher interest currency and that bids up its value versus the dollar.

    The Euro represents an economy about the size of the U.S., so there may be some safety there. You could argue for the Swiss Franc maybe, but you know the Swiss banks (Credit Suisse, for example) have had some problems, so we’re not quite sure how that’s going.

    So, to me, the only clear money that’s going to survive all this and go up, because everything else is going to go down, is gold.

    TGR: What’s your view of holding physical gold versus gold equities?

    JD: I only hold gold equities. They’re more readily tradable; when gold goes up, the equities tend to go up by a factor of two or three times. Of course, that works to the reverse, as we know. As gold went down, the equities went down more. But because you hold them in a government-guaranteed SIPC account, it provides ease of trading—you don’t have the worries of physical gold. . .insurance, storage or whatever. You may want to hold a few coins, but that would be about it in my opinion.

    TGR: On your website, your approach to investing in gold equities is to choose a portfolio of 10 companies that have the opportunity to double in an 18- to 24-month period with the current gold price.

    JD: Yes. We don’t really look forward more than 18 or 24 months; but within that timeframe, say a year from now, we could reassess and raise our targets so that, in the following 18 to 24 months, the stocks, while having gone up, could go up more still. There are lots of opportunities to stay in the same stocks as long as they continue to perform well. We’re not a trading newsletter, and as you probably know, the way we define an undervalued stock is based on two metrics.

    One is market cap per ounce. The market capitalization of a company is the number of shares times its price. You divide that by its ounces of production and its ounces of proven and probable reserves, and you see how the company’s data compares to the industry’s weighted averages.

    Second, we look at operating cash flow multiples. Take the difference between the gold price and the cash cost to produce an ounce, multiply that by the company’s production per year, and you get operating cash flow. Divide that into its market capitalization and you get its operating cash flow multiple. We look at that this much the same as one looks at earnings per share multiples in other industries.

    For reference, we last calculated the industry averages on December 29, 2008 for the 50+ gold miners we follow, which is everyone of significance. At that time, the average market cap for an ounce of production was $3,634, an ounce of proven and probable reserves was $194, and the average operating cash flow multiple on forecast 2009 production, assuming $900/oz gold, was 7.4X.

    We focus companies that are below the averages and try to figure out why. An ounce of gold is an ounce of gold, it doesn’t matter who mined it. If you’re going to buy an ounce of gold from a coin dealer, you want to get the cheapest price. Well, if you’re going to buy an ounce of gold in the stock market, you should want to get those at the cheapest price, too. It’s oversimplified, as there are other factors to be considered, but this is a primary screening tool to determine which stocks merit further study. The method works, as the GSA Top 10 Stocks portfolio has outperformed every other gold investment vehicle since we began in 1994.

    TGR: Are all the companies in your coverage producers or have 43-101’s??

    JD: Yes, all are producing or near-producing. They may be in the money-raising stage to build a mine, but they’ve got an independently determined reserve. And that part of the market has done better than the explorers because it has more data to underpin the stocks’ prices.

    TGR: And you focus in on having 10 just because, as you point out in your materials, it allows you to maximum upside at minimum risk (i.e., if one of the 10 goes down 50%, you will only lose 5% of your money). Is your portfolio always at 10 or does it ever expand more than that?

    JD: No, earlier in 2008 we were 40% cash, so it was six stocks. For a couple of months later in 2008 it was 11 stocks. But 90% of the time it’s at 10.

    TGR: What prompted you to be 40% in cash?

    JD: That was when Bear Stearns was rescued in March and gold went to $1000; we were just uncomfortable with that whole scenario. And actually we put the 40% in the gold ETF; so it wasn’t true cash.

    TGR: Okay. And as you’re looking at these undervalued companies, are you finding that there are certain qualifications? Are they typically in a certain area, certain size?

    JD: While we follow Barrick Gold Corporation (NYSE:ABX) and Newmont Mining Corp. (NYSE:NEM) and they’ve both been Top 10 in the past, neither is now. We’re currently looking further down the food chain. There’s one with over two million ounces growing to four million a year. Another has a million growing to two million. So, some are still pretty good sized. And then there are others further down that are either developing mines or are very cheap on a market cap per ounce basis.

    Earlier, one of the Top 10 was selling at its “cash in the bank” price. We’ve had a nice little rally since October and this stock has doubled, but it’s still cheap. It has 9 million ounces of reserves at three mine sites in European Community nations, and it’s not Gabriel in Romania. It has no major troubles with permitting its mines and it was selling at its cash/share. Then the chairman of the board bought 5 million more shares. It was already top 10, but I pointed this out to subscribers as great buy signal. It’s doubled since and will double again, in our opinion.

    TGR: Can you share with us some of the ones that are in your top 10?

    JD: Well, the astute investor would probably recognize Goldcorp (NYSE:GG) as the one at two million ounces growing to four million ounces. Their tremendous new mine in Mexico, Penasquito, which I have been to and written about, is going to average half a million ounces of gold and 30 million ounces of silver a year. It’s going to be the biggest producing silver mine in the world, momentarily anyway, and will produce huge quantities of lead and zinc. At current prices, it’s going to be a billion-dollar-a-year revenues mine, which is enormous. And because of by-products, and even at current prices, the 500,000 ounces of gold per year will be produced at a negative cash cost per ounce.

    TGR: Wow. Because of the credits?

    JD: Because of the by-product credits. Another one would be Yamana Gold Inc. (NYSE:AUY), which is growing from a million ounces to two million ounces. Both Yamana and Goldcorp are in politically safe areas—no Bolivia, no Ecuador, no Romania—none of the places where you have to take political risk. I think we’ve learned enough from the Crystallex International Corp. (KRY) and Gold Reserve Inc. (NYSE:GRZ) situation in Venezuela, where they’re both on portions of the same huge deposit that is probably 25 million ounces or more. It looks to me that the government is going to take it away from them. So, I would just as soon not be involved in that kind of political risk scenario. There’s enough risk in gold just from the mining aspects of it that you don’t have to take chances on the politics too, as in some nations that’s impossible to assess.

    TGR: Yes, another one that is really doing quite well is Royal Gold Inc. (Nasdaq:RGLD). Can you speak about that company?

    JD: Yes. Royal Gold has been GSA Top 10 for 18 months now. We put it on in part because of the Penasquito deposit that I mentioned earlier. Royal has a 2% royalty on that, and 2% of a billion dollars is $20 million a year. Royal is unique in that they haven’t prostituted themselves by selling shares on a continuous basis. They only have 34 million shares outstanding and they will have royalty income this year of about $100 million. Penasquito is just coming on line, so its $20 million per year won’t be fully seen until late 2010.

    Plus Royal pays a dividend. I think it could pay $1.00/share ($0.32 now). Dividend-paying gold stocks typically trade at a 1% yield. A $1.00/share dividend would make Royal a potential $100 stock. That’s my crystal ball down-the-road target.

    Royal is a great play on gold price because they don’t have the aggravation of mining. They have a portfolio of mine royalties, plus a small corporate office. Royal employs 16 people, has $150 million in the bank and over $100 million a year income, which is about $3.00 per share pre-tax. Their biggest cost is taxes.

    TGR: I see also that Franco Nevada Corp. (FNV.TO) has had quite a rise, though they have been kind of tumultuous between November and December.

    JD: Franco is also a stock we like. About half of its royalties are from oil, so that’s why it’s suffered. The original Franco Nevada, as you know, was merged into Newmont for five years, and then they came public again in December ’07. I think it’s a good way to play gold and oil, and I think everybody agrees that oil is not going to stay in the $40 range for long.

    TGR: John, can you give us a few more?

    JD: A couple of smaller ones we like are Northgate Minerals Corp. (AMEX:NXG) and Golden Star Resources Ltd. [TSX:GSC]. Northgate is a misunderstood producer. Everybody thinks it’s going out of business when the Kemess Mine closes after 2011, but it’s actually not. It has 200,000 ounces a year from two mines in Australia and has a potential new mine in Ontario where they’ve just announced a 43-101 with over three million ounces. That’s potentially another 200,000 ounces a year, so we think they’ll remain at 400,000 ounces a year from Canada and Australia, both of which are countries we like. Cheap on our market cap per ounce of production and reserves metrics, it’s trading at an operating cash flow multiple under 2.0X.

    Golden Star has several nearby mines in Ghana with production targeted at about 500,000 ounces in 2009. They’ve been ramping up to this rate for the past year and cash costs have run much higher than plan. If costs can be controlled and production goals met, it’s a takeover candidate for someone already in the country, such as Newmont or Gold Fields Ltd. (NYSE:GFI).

    One thing I think readers should bear in mind is that gold mining will be one of the few industries doing well in 2009. Their key cost is oil, which is about 25% of the cost of running a mine. Oil’s price, as we know, is down about 75% in the $147/barrel high last July. At the average $400 cash cost per ounce mine, that’s a cut of about $75/oz off their costs. That result alone is going to give them an uptick in future earnings versus what they showed for third quarter 2008.

    Something else people may not recognize is that currencies are also falling; many are down 20% to 40% versus the U.S. dollar. All the commodity nation currencies—the Canadian dollar, the Australian dollar, the South African Rand, the Brazilian Real, the Mexican Peso—they’re all down 20% to 40%. When your mining costs in those countries are translated back into U.S. dollars, they’ll be 20% to 40% lower.

    So, the miners are going to have falling cash costs and even if the gold price remains exactly where it is now profits are going to soar. This will be unique in 2009. I can’t think of any other industry in which people are going to be able to point to and say, “These guys are making a lot more money.” I think the increasing profits will get the gold mining industry recognition that it isn’t getting now. Of course I’m a bull on gold because of the macroeconomic picture. When you put falling costs of production together with a rising gold price, you’ve got a winning combination for the stocks in 2009.

    TGR: I was wondering if you could give us something on Silver Wheaton Corp. (NYSE:SLW).

    JD: Well, Silver Wheaton is another royalty company; it’s not a producer. It gets its profit royalties by paying a cash sum up front and $4/ounce on an ongoing basis. It captures the difference between the silver price and $4 an ounce; if silver is $10 and it pays $4, it makes a $6 an ounce profit; at $20 silver, its profit would be $16. Aside from no pure silver miner actually producing ounces as low as $4.00, there’s a lot of leverage to silver price. I am not a silver bull, but because I’m a gold bull I think silver will follow gold higher.

    Silver Wheaton is one of those companies that doesn’t have the issues of actually doing the mining. It has a portfolio of mines that it gets production from, and it owns 25% of the production from Goldcorp’s Penasquito mine that it buys at $4 an ounce, and will average about 8 million ounces a year. It’s just starting up now, but it will really get going in 2010. Silver Wheaton’s share of the total mineralization at Penasquito is 1 billion ounces. There’s 4 billion total ounces of silver there and it bought 25%. So, for a long time—the mine life of Penasquito is over 30 years—it’s going to be a big producing mine for Silver Wheaton.

    TGR: Isn’t there a twin sister to Silver Wheaton in the gold area?

    JD: Well, there’s Gold Wheaton Gold Corp. [TSX.V:GLW]. It’s based on the premise that some companies have a gold by-product. With their primary production in some other kind of metal, some might like to lay off the gold for a $400 an ounce on-going payment and an up-front purchase amount. Yes, some of the same guys are involved. I’m not convinced it’s going to do as well because it’s already got a lot of shares outstanding, and I just don’t like the capital structure as much. I wouldn’t bet against these guys but I’m not a believer.

    TGR: And you said you’re not a silver bull. Why is that?

    JD: We do cover about 15 silver miners, but reason number one for not being a bull is that it’s a by-product. Few mines are built to get just silver; 70% to 80% of silver comes as a by-product to copper, zinc, gold or some other metal. If you’re producing copper, you’re more interested in the copper price than you are in the silver price and you tend to just dump the silver onto the market.

    And second, it’s not a monetary commodity. It is poor man’s gold—but it doesn’t have the universal monetary acceptance that gold does. It has a growing list of industrial uses, but it’s not growing at any rate that’s going to offset the falling use in photography. So, the overall demand for silver is not growing at any great rate. It’s not going to go from 800 million ounces a year to 1.6 billion ounces a year; it may get there in 20 years or 30 years, but that’s not our investment time horizon.

    I think silver just follows gold along; but, in fact, it hasn’t been following gold along because right now silver is trading at a discount to gold. The ratio of gold to silver price, which normally runs around 50–55, is now around 80, so silver might have a little bit of a pop-up if the discount closes. But there are a lot of new silver mines coming on line and maybe that’s why the discount exists. Penasquito is one and Silver Standard Resources Inc. (Nasdaq:SSRI) has a big one starting in 2009. Coeur d’Alene Mines Corp. (NYSE:CDE) has now one ramping up and Apex Silver Mines Ltd. (AMEX:SIL) San Cristobal is now on line at 20+ million ounces per year as a zinc by-product. There’s potentially more silver coming to market than the world really needs. We do recommend Silver Wheaton, but that’s our single play.

    TGR: Can you give us any comments on Minefinders Corporation (AMEX:MFN)?

    JD: Well, you know, it’s in the uncertainty phase as to whether or not the new Delores mine in Mexico is going to work. Now built, it’s just starting up. We like the stock as we think it’s going to work. The question is: will it? Two mines in the area—Mulatos, owned by Alamos Gold Inc. [TSX:AGI], and Ocampo owned by Gammon Gold Inc. (GRS) did not start up smoothly. The market is betting against Delores starting smoothly, but this is the last of the three mines to come on line, and the first two mines—Alamos’ and Gammon’s—did get fixed and are now running okay. So, I think Minefinders has probably learned from the experience of the others, and the mine should start up all right. But, you know, the proof will be in the pudding. If you take its market cap per ounce on the forecast 185,000 ounces of production in 2009, or its almost 5 million ounces of reserves, and compare it to the industry averages we calculate, it’s potentially a double or triple from here.

    TGR: So, the start-up issues of the other two mines, were they politically related?

    JD: No, it was metal related. Processing facilities aren’t like televisions; you don’t just turn them on. It’s more like buying a new fancy computer system that needs to be twiddled and tweaked and loaded with the right programs. And you know, all geology is different, so things seldom start up properly; and, given the long teething problems at the other two mines, that’s sort of been a curse. If Minefinders can beat it and start up on plan, it’s an easy winner in 2009.

    TGR: So, John do you have a prediction on where you think gold will go in ‘09?

    JD: People talk about $2,000 or $5,000—it’s all pie in the sky, you know. Gold might get there; but the bigger question is: what’s the timeframe? Will I be around when gold is $5,000? I doubt it. Will it get there? Probably.

    But we look for undervalued situations no matter what the gold price. And in the ‘90s—you know we’ve been writing Gold Stock Analyst since 1994—in the mid-90s gold did nothing for three years, it traded between $350 and $400. With our methods of selecting undervalued stocks, we had a couple of years of the Top 10 portfolio up 60% and 70% but gold was flat. Until mid-2008 the GSA Top 10 was up almost 800% in the current gold bull market. When gold does go up, the stocks go up more; but, in general, even if gold does nothing, we can still find good buys. Royal Gold is an example of finding winners in a tough market. Made a Top 10 stock at $23 in mid-2007, it gained 60% in 2008 and has doubled over the past 18 months.

    We don’t follow the explorers, in part because there is no data to analyze beyond drill hole results, which are a long way from showing a mine can be built and operated at a profit. For us, the pure explorers are too much like lottery tickets. The producers do exploration and you can get your discovery upside from them. Bema Gold (acquired by Kinross Gold in February 2007) was a Top 10 stock with 100,000 ounces per year of production when it found Cerro Casale and it did very nicely on the back of that find. So, with the smaller producers you can get plenty of exploration upside. You don’t need to focus on the greenfield explorers because it’s just too hard to tell who’s going to win and who’s going to lose.

     

    John Doody brings a unique perspective to gold stock analysis. With a BA in Economics from Columbia and an MBA in Finance from Boston University, where he also did his Ph.D.-Economics course work, Doody has no formal “rock” studies beyond “Introductory Geology” at Columbia University’s School of Mines.

    An Economics Professor for almost two decades, Doody became interested in gold due to an innate distrust of politicians. In order to serve those that elected them, politicians always try to get nine slices out of an eight slice pizza. How do they do this? They debase the currency via inflationary economic policies.

    Success with his method of finding undervalued gold mining stocks led Doody to leave teaching and start the Gold Stock Analyst newsletter late in 1994. The newsletter covers only producers or near-producers that have an independent feasibility study validating their their reserves are economical to produce.

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    ***All Posts are  not  to be considered Investment Advice, the articles/posts are presented for Informational Purposes. Consult Your Own Investment Advisors and Carefully Research and Read the Prospectus’s before making any Investment.*** jschulmannsr

    As Always Bringing You The Must Have Information for Today’s Gold Markets and Hard Assets Investing- Dare Something Worthy Today Too!  Brought To You By:- jschulmansr

     

     

     There is another option, however, which involves debt holders taking a share of the losses. If steps are not taken to ensure that this happens, the greatest heist in history will have occurred: at least $1 trillion will be transferred from taxpayers to debt holders of failed financial institutions. This must not be allowed to happen.

     Mark-to-Market vs. Real Losses

    To understand the government’s dilemma, one must realize that the great majority of the not-yet-recognized losses in our financial system are not short-term, mark-to-market losses that will someday be reversed, but permanent losses. This is a huge misunderstanding that many people, especially those in Washington, seem to be suffering from.

     To understand why the losses are real, consider this simple example: imagine a bank that lent someone $750,000 via an Option ARM mortgage to buy a McMansion in California at the peak of the bubble less than two years ago. Virtually all homeowners with this type of loan will default, thanks to declining home prices, the structure of the loan, and the fact that 70-80% of Option ARMs were liar’s loans. If we assume the house is only worth $400,000 today, then there’s been an actual loss of $350,000. That money will never be recovered. If one considers the millions of toxic loans made during the bubble – subprime, Alt-A, Option ARM and second mortgages, home equity lines of credit, commercial real estate, leveraged loans, credit cards, etc. – it easily adds up to at least $1 trillion in additional, unrecognized very real losses.

     Imagine that New RTC buys this loan for $400,000. In this case, it might not lose money, but then the bank (or the structured finance pool) holding the loan has to immediately realize the loss of $350,000 – and it is certain that the U.S. (and world) financial system has not even come close to marking these assets to what they’re really worth, which explains why they won’t lend, even when given new money. Thus, if New RTC buys these assets at fair value, then the financial institutions suffer the losses – but this would bankrupt many of them. Yet if New RTC pays the inflated prices they’re marked at today, then it (and taxpayers) will suffer huge losses.

    Who Should Bear the Losses?

    To save our financial system, somebody’s going to have bear these losses – the only question is, who? Some fraction of this will certainly have to be taxpayer money, but all of it needn’t be if the government would stop bailing out all of the debt holders.

     Government policy has been all over the map. Among the large financial institutions that have run into trouble (in chronological order, Bear Stearns, IndyMac, Fannie & Freddie, Lehman, AIG, WaMu, Citigroup and Bank of America), in some cases the equity was somewhat protected, while in others was wiped out, and likewise with the debt. Most likely due to the chaos that ensued after Lehman filed for bankruptcy, the current policy, as reflected in the most recent cases of Citi and BofA, is to at least partially protect the shareholders and, incredibly, 100% protect all debt holders, even junior/unsecured/subordinated debt holders.

     The result is at least a $1 trillion transfer of wealth from taxpayers to debt holders. This makes no sense from a financial, fairness or moral hazard perspective. While there’s an argument that the government should protect senior debt holders to preserve confidence in the system (even though they knowingly took risk – after all, they could have bought Treasuries), the junior debt holders got paid even higher interest in exchange for knowingly taking even more risk by being subordinate in the capital structure (of course, equity and preferred equity holders are the most junior). These investors made bad decisions, buying junior positions in highly leveraged companies that made bad decisions, so why should they be protected?

     Moreover, the reckless behavior of debt investors was a major contributor to the bubble. It was low-cost debt with virtually no strings attached that allowed borrowers, especially the world’s major financial institutions, to become massively overleveraged, fueling the greatest asset bubble in history. This was not an equity bubble – unlike the internet bubble, for example, stock market valuations never got crazy – it was a debt bubble, so it would be particularly perverse and ironic if government bailouts allowed equity holders to take a beating, yet fully protected debt holders.

     Case Study: Bank of America

    Let’s look at Bank of America (BAC), which effectively went bankrupt last week (disclosure: we are short the stock). The cost to taxpayers of avoiding this outcome wasn’t the headline $20 billion, but far more – the government is going to take a bath on the $120 billion that it guaranteed – and it’s likely that this is just the beginning of the losses.

     Consider this: as of the end of 2008, BofA had $1.82 trillion in assets ($1.72 trillion excluding goodwill and intangibles), supported by a mere $86.6 billion in tangible equity – 5.0% of tangible assets or 20:1 leverage – and $48.9 billion of tangible common equity – 2.8% of tangible assets or 35:1 leverage (common equity excludes the TARP injection of capital in the form of preferred stock, which has characteristics of both debt and equity). (All data from BofA’s earnings release on 1/16/09; note that these figures include Countrywide, but not Merrill Lynch)

     At such leverage levels, it only takes tiny losses to plunge a company into insolvency. It’s impossible to know with precision what BofA’s ultimate losses will be, but among the company’s loans are many in areas of great stress including $342.8 billion of commercial loans ($6.5 billion of which is nonperforming, up from $2.2 billion a year earlier), $253.5 billion of residential mortgages ($7.0 billion of which is nonperforming, up from $2.0 billion a year earlier), $152.5 billion of home equity loans (HELOCs; about $33 billion of which were Countrywide’s), and $18.2 billion of Option ARMs (on top of the $253.5 billion of residential mortgages; all of which were from Countrywide, which reported that as of June 30, 2008, 72% were negatively amortizing and 83% had been underwritten with low or no doc).

     BofA is acknowledging a significant increase in losses, but its reserving has actually become more aggressive over the past year. From the end of 2007 to the end of 2008, nonperforming assets more than tripled from $5.9 billion to $18.2 billion, yet the allowance for credit losses didn’t even double, from $12.1 billion to $23.5 billion. As a result, the allowance for loan and lease losses as a percentage of total nonperforming loans and leases declined from 207% to 141%.

     So BofA had big problems on its own and then made two very ill-advised acquisitions, the result of which effectively wiped out the company, causing the government to come in and bail it out, at a huge cost to taxpayers. So what price is being paid? NONE! The architect of this debacle, Ken Lewis, is still in place, as is the board that approved everything he did. Ditto with Citi. These banks are just getting do-overs, with the management, boards and debt holders not being touched – the only losers are the common shareholders (to some extent) and taxpayers (to a huge extent).

     Since big losses from Merrill Lynch triggered last week’s bailout of BofA, why are all of its debt holders ($5.3 billion of junior subordinated notes, $31.2 billion of short-term debt and $206.6 billion of long-term debt) being protected 100%, while taxpayers are taking a bath eating Merrill’s losses from its reckless, greedy behavior?! This is madness.

    A Better Solution

    So what’s a better solution? I’m not arguing that BofA (or Citi or WaMu or Fannie or Freddie or AIG or Bear) should have been allowed to go bankrupt – we all saw the chaos that ensued when Lehman went bankrupt. Rather, if a company blows up (and can’t find a buyer), the following things should happen:

    1) The government seizes it and puts it into conservatorship (as Fannie, Freddie, IndyMac and AIG effectively were, to one degree or another);

    2) Equity is wiped out (again, as with Fannie, Freddie, IndyMac and AIG);

    3) However, unlike Fannie, Freddie, IndyMac and AIG (and certainly Citi and BofA), everything in the capital structure except maybe the senior debt is at risk and absorbs losses as they are realized; the government would only provide a backstop above a certain level. This is what happened in the RTC bailout;

    4) Over time, in conservatorship, while the businesses continue to operate (no mass layoffs, distressed sales, etc.), the government disposes of the companies in a variety of ways (just as the RTC did via runoff, selling the entire company or piece-by-piece, etc.), depending on the circumstances (as it’s doing with AIG and IndyMac, for example – these are good examples, except that the debt holders were protected).

    Counter-Arguments

    One counter-argument to my proposal is that we don’t want the government to nationalize banks. I don’t like it either, but the alternative – inject hundreds of billions of dollars of taxpayer money and not take control – is even less palatable. There should certainly be urgency in disposing of the companies, but also the recognition that it could take years, as with the RTC.

     Another counter-argument is Lehman: nobody wants a repeat of the chaos that ensued when the company went under and debt holders were wiped out. But the mistake here wasn’t the failure to protect the debt, but rather allowing the company to go bankrupt, which not only impacted Lehman’s equity and debt holders, but also stiffed Lehman’s countless clients and counterparties. It’s the latter that caused the true chaos. Lehman should have been seized and put into conservatorship, so that all of Lehman’s clients and counterparties could have relied on Lehman (as was done with AIG) – but debt holders would have taken losses as they were realized (which is not being done with AIG).

    A final argument for protecting the debt is the fear of contagion effects: for example, other financial institutions who own the debt might become insolvent (this was probably why Fannie and Freddie subdebt was saved). Also, debt markets might freeze up such that even currently healthy banks might not be able to access debt and collapse.

     Regarding the former, the debt is owned by a wide range of institutions all over the world: sovereign wealth funds, pension funds, endowments, insurance companies and, to be sure, other banks. Some of them would no doubt be hurt if they take losses on the debt they hold in troubled financial institutions – but that’s no reason to protect all of them 100% with taxpayer money.

     As for the latter concern that debt markets might freeze up, causing even healthy banks to collapse, it’s important to understand that right now there is no junior debt available to any financial institution with even a hint of weakness – there’s very high cost equity and government-guaranteed debt. Neither of these will be affected if legacy debt holders are forced to bear some of the cost of the failure of certain institutions.

     Conclusion

    The new Obama administration needs to understand that the greatest heist in history is underway – at least $1 trillion is being transferred from taxpayers to debt holders of failed financial institutions – and take steps to stop it before taxpayers suffer further unnecessary losses.

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