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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 01/12/2007 : 17:36:37
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RPT-UPDATE 5-Gold rallies on fund buying, dollar slide
Excerpts
By Frank Tang and Atul Prakash
NEW YORK/LONDON, Jan 12 (Reuters) - Gold rallied to finished up more than 2 percent on Friday, supported by fund buying as prices moved above technical levels and a fall in the dollar, dealers said.
The metals in general have been able to move higher this week despite further weakness in energy and a stronger dollar," said David Rinehimer, director of commodities research at Citigroup Global Markets.
Rinehimer said precious metals had been gaining momentum throughout the week, as prices moved above levels that triggered technical buying.
"We've seen some improvement of demand, particularly in the gold market, as some lower prices appeared to attract stronger buying interest," said Rinehimer.
"We are positive as long as gold stays above $609-$610," a precious metals dealer in London said, adding the break above $615 had triggered technical buying.
The dollar fell from 1-1/2-month highs against the euro as traders sold the currency on speculation that gains from a three-day rally were overdone.
The dollar initially rallied after the government said retail sales rose at their strongest pace since July last month, the key holiday period.
Gold prices often rise on a decline in the dollar as the metal becomes cheaper for holders of other currencies. Gold is also seen as a hedge against oil-led inflation.
Dealers said the metal's ability to remain relatively stable despite a slump in oil price and the earlier rise in the dollar might boost sentiment.
"We didn't break down and always held up above $600 (this week) despite oil coming under severe pressure," said David Holmes, analyst at Dresdner Kleinwort, adding that gold was likely to trade in a range of $600-$650 in the near term.
Oil prices bounced back from a 19-month low on worries that producer group OPEC would deepen its supply cuts to stem a 15 percent slide since the start of the year.
U.S. crude oil futures ended more than a dollar higher on Friday, ending a string of four straight losing sessions
This may effect the world's gold supply, a little
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Zimbabwe: Reserve Bank Fails to Pay Gold Producers Forex
Vincent Kahiya
THE Reserve Bank of Zimbabwe has since last October failed to remit foreign currency payments to gold producers in a development that saw gold production plummeting to record lows in the last quarter of the year.
The situation in the gold sector is so dire that some producers who closed for the Christmas break have indicated that they will not re-open their mines until they receive their payments from the central bank.
Mining sources said most gold mines were operating at below 40% of capacity owing to a myriad problems, chief among them an overvalued currency, unsupportive monetary policy system and power outages. The failure to pay the producers on time has added to their woes resulting in miners cutting back production further by at least 30% in the last quarter of last year.
The miners under the Zimbabwe Chamber of Mines, together with officials from the Mines ministry, have since September held meetings with the Reserve Bank to try and resolve the crisis but to no avail.
One such meeting was held last Thursday but there has not been any development yet.
The RBZ through its subsidiary Fidelity Refineries is supposed to pay for 50% of gold within four days of delivery, with the balance being paid within 21 days.
"The RBZ has not been living up to this promise and in most cases is taking up to 60 days to pay," said a an executive at a Midlands-based gold mine. "This has serious cash flow implications for gold producers."
He added: "Most inputs have to be imported for cash as few foreign suppliers will give credit to Zimbabwe companies. When the RBZ is over 45 days overdue, it means a gold producer has to have working capital for consumables like cyanide, explosives, drilling spares, pump spares, fuel etc of at least 90 days, which is near impossible in these days of tight cash flow and high interest rates."
The gold mining companies have been brought to their knees by this latest development. It is estimated they have lost at least 30% of their production during the period September to December due to the late payment of sales proceeds by the RBZ.
Last August, the RBZ increased gold miners' foreign currency retention package from 40% to 75% but later reduced it to 67,5%. Miners have two main options of receiving payment from the central bank. They can be paid in local currency at a rate of $16 000 a gramme or they can opt for payment in the foreign currency/Zimbabwe dollar blend.
Under the former arrangement, payment is effected within a week and sometimes as early as three days. Under the latter, the value to be paid is determined by the ruling price on the international markets at the time of delivery.
The miners should receive their foreign currency payment within 21 days while the Zimbabwe dollar payment is usually done in four days calculated at the rate of $250:US$1.
Gold is currently fetching about US$620 an ounce on the international markets
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Zimbabwe: Gold Mining Falls to 'Pathetic Levels'
Zimbabwe Independent (Harare)
COLUMN
January 12, 2007
Posted to the web January 12, 2007
Excerpt
IT is no secret that the Zimbabwean mining industry has been shrinking over the past six years and has not witnessed any significant new investment
other than in the platinum and diamonds sectors.
The gold industry has been particularly affected with production having fallen from a high of 29 tonnes per annum at its peak to the current 12 tonnes expected to have been produced in 2006.
Why has the gold sector contracted so dramatically when the platinum sector has been expanding? Recent press and company market briefings indicate that the two current platinum producers, Zimplats and Mimosa, have systematically increased production and new investments over the past six years and will continue to do so in the near future. A third producer, Unki Platinum, under Anglo has committed and started its capital investment to bring another mine into production in the next few years. This is in direct contrast to the Zimbabwean mining industry in general and the mining sector in particular.
The answer is very simple.
The platinum industry enjoys a fiscal and monetary regime far superior to any other sector of the Zimbabwe economy.
The platinum industry is allowed to retain 100% of its foreign currency earnings offshore, and only liquidates into the Zimbabwe dollar as and when it so wishes.
The mining industry is a capital-intensive industry and typically it takes a long time before any profits can be realised. Most of the capital required in this industry is forex-based as most of the items are imported. In addition, most of the consumables in the industry are imported and typically, up to 75% of a mine's input costs including capital are imported.
It is a known fact that although gold producers operate in an environment of high capital requirements, long lead times to production, high recurring foreign exchange requirements, they have been subjected to the worst monetary regime of any other exporter in the country.
Indeed, the anomaly whereby gold producers enjoyed only 40% retention of their earnings in US dollar, whilst the majority of others enjoy 70%, whilst simultaneously requiring high foreign exchange retentions to sustain and grow operations, has contributed to the fall of production and new investment in the gold industry.
Until August 2006, gold producers were required to surrender 60% of their forex earnings to the government at a sub-economic exchange rate. The 40% forex retention was hardly enough to take care of working capital requirements, leaving virtually nothing for critical capital such as exploration, equipment, etc.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 01/12/2007 : 17:40:08
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This might effect gold supply too.
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Venezuela's MIBAM says miners should export less gold
Minister Jose Khan of Venezuela's Ministry of Basic Industry and Mining (MIBAM)
has called for the reform of a Central Bank statute that allows foreign and domestic miners to export up to 85% of their Venezuelan gold output, the ministry said Thursday.
A change in the law to limit the percentage of gold exports would enable the domestic gold processing industry to receive more gold for its use and thus boost the fortunes of the national mining industry, according to Khan.
He noted that the mining sector currently only provides 0.6% of the country's Gross Domestic Product (GDP) as opposed to the island of Aruba, where mining comprises 4.5% of GDP, "which one presumes is because of their ability to add value to the product," said Khan.
The MIBAM head also referred to the reform of the National Mining Law, which is expected to be passed this year and would eliminate gold and diamond mining concessions in their present form, as further justification for reforming the Central Bank law. In late 2005, President Hugo Chavez spoke about doing away with concessions, though the government has since said that current "active" concessions will not be endangered by any modifications.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 01/13/2007 : 12:16:37
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Trade in gold jumps in China
Chinese investors traded enthusiastically in gold last year, according to the latest figures from the Shanghai Gold Exchange.
Information from the exchange shows that in 2006 turnover in the precious metal reached 194.75 billion yuan (25 billion U.S. dollars), up 82 percent over 2005.
A total of 1,250 tons of gold were traded, up 38 percent year on year.
Higher gold prices have boosted trading volumes.
Against a background of increasing international prices, domestic gold price rose from 130 yuan per gram at the beginning of 2006 to over 150 yuan per gram currently. In the middle of the year, prices peaked at 200 yuan per gram.
Since the Shanghai Gold Exchange started operation in Oct. 2002, gold trading has become one of the preferred investment options of Chinese citizens together with foreign exchange, stocks and futures.
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Russia scraps quotas on precious metals exports
MOSCOW - Russia has scrapped export quotas on precious metals and diamonds, the Kremlin’s press service said on Saturday.
President Vladimir Putin has signed a decree allowing unlimited exports of most uncut diamonds, platinum group metals and other precious metals and ores.
Exports will still require a licence from the Ministry of Economic Development and Trade, the Kremlin said in a statement.
Previously, the Russian government set long-term quotas for exports of precious metals and uncut diamonds.
These were already large enough to accommodate exports from Russia’s biggest palladium and platinum miner, Norilsk Nickel GMKN.RTS, and state diamond trader Almazyuvelirexport so analysts have said their removal is unlikely to have a major impact.
The statement said the decree would become effective from the day of signing. It did not say exactly when Putin signed the docoment.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 01/15/2007 : 18:22:40
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Excerpt
No real discussion can be complete without talking about the precious metals and it's just in time because there seems to be a lot of debate as to direction and strength.
Those of us who tend to follow gold on a regular basis quite often make the mistake of getting too caught up in the daily intrigues and we forget that there is a big picture.
No other type of investment plays off of the human emotions like gold does.
Most assets rise on greed and fall on fear while gold is the only investment I know of that can rise on both greed and fear; it just depends on the moment.
More than any other investment, gold can cause you to count your chickens before they hatch and that's why it's so demoralizing when it doesn't act the way we "think" it should.
Bull markets in gold are by far the most difficult to deal with. They just love to cross you up, buying tops and selling bottoms. I've never been a fan of that so I decided several years back to take an initial position,
add on with any significant correction,
and try to hold on for dear life.
Very easy to say but very difficult to do!
I've had a lot of less than comfortable moments, but it has been worth it.
I would like to try and bring some perspective to the current gold picture.
We are now in January and almost all the investors I know were counting on the seasonality of gold. By that I mean that gold has rallied nicely from September to late January (last year it lasted until May 11th) for the last five years and investors now assume that the winter surge is written in stone.
....we've rallied but it hasn't been the stuff dreams are made out of.
To really understand what gold is doing though, you need to go back to the May 11th high of 730.40. Gold has since posted a series of lower highs and higher lows while hugging the 50-wma (610.38) along the way.
Additionally gold is undergoing accomulation.
Throw in the fact that most are now bearish gold and I believe this is very bullish scenario.
Gold has done nothing wrong to date and as long as we do not make a lower low, below 570.94, I see absolutely nothing to worry about (and even if we did I would still sit through it). Given the amount of fiat currency being printed by just about every major country in the world, gold is the only real money worth having and that is why it continually undergoes accomeulation.
As real incomes rise in Asia, this accomeulation will only increase.
The same holds true for silver.
At times silver leads gold, especially when both are strong. This has been the case for the last two months even though investors don't have a lot to show for it.
Silver is also more volatile than gold as we saw late in December.
It looks the same doesn't it? The only exception is that silver made a higher high at 14.37 instead of a lower high like gold. It is also currently trading above its 50-wma.
Both gold and silver have key numbers to watch and they are 610.2, 631.1, 655.0, 678.8, and 705.0 bases the February 07 gold futures contract and 1142.6, 1211.3, 1280.5, and 1356.7 basis the March 07 silver futures contract.
Precious metals stocks are another story altogether.
If the Dow is rolling over as I believe it is, these stocks will more than likely get caught in the downdraft and the decline could last months. There is no real way of knowing. There is also another problem with the mining companies that has so far gone unnoticed.
Most mining is done in third and fourth world countries where governments are notoriously unstable and corrupt.
As the price of metals rises, these governments tend to look at these companies are their private, captive piggy banks.
Need money?
Squeeze the miners!
If the world's financial markets enter rough waters and capital becomes scarce, this tendency will only increase.
Companies like Newmont are particularly susceptible to such problems as their investments are so large and capital intensive that they make great targets.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 01/15/2007 : 19:12:38
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Gold hits 10-day high on dollar, technical buying
By Atul Prakash
LONDON (Reuters) - Gold extended gains on Monday to hit its highest in about 10 days, supported by technical buying and a slight decline in the dollar against the euro.
But traders and analysts said the metal might struggle to move significantly higher in the near term.
"Probably the outlook from here is neutral," John Reade, head of metals strategy at UBS Investment Bank, said.
"According to our Forex strategists, we might see dollar strength in the short term because U.S. economic data is coming through so strongly. Although I like gold on one-month and three-month view, I am little bit cautious here," he said.
Spot gold rose as high as $627.50 an ounce, its best since January 4. The metal was quoted at $626.6/627.6 by 1115 GMT, compared with $625.60/626.60 in New York late on Friday, when it jumped more than $14.
Gold has been erratic since hitting its highest in nearly a month at $644.90 at the start of the year. It tumbled to a two-month low of $601.70 on January 5 due to a surging dollar.
Dealers said technical buying intensified after gold crossed its 200-day moving average of $621.59 an ounce on Friday. Light trading volumes also exaggerated price moves.
Trading was likely to be subdued on Monday with U.S. markets closed for the Martin Luther King Day holiday.
Analysts said gold was helped by the dollar, which fell from the previous week's 1-1/2-month highs. The metal often moves in the opposite direction of the dollar.
"We've seen gold being well supported above $600 after recent sharp falls. The mood of the market has improved," Takashi Ogura, manager of the risk management department at Kanetsu Asset Management in Asia, said.
"Despite oil prices having made some gains, we're still a bit worried about their slump, which could cap gains in gold prices," he added.
Oil rose above $53 a barrel, recovering further from a 19-month low last week.
ITALIAN JEWELLERY
Physical gold demand was slow, but an industry expert said the Italian jewellery industry might see a stabilisation this year after several years of decline if first signs of consumer demand recovery were confirmed.
Italy's jewellery industry is the biggest in Europe and is fighting for the second position after India in the global rankings against growing competition from Turkey and China.
In industry news, Russia scrapped export quotas on several metals. President Vladimir Putin has signed a decree allowing unlimited exports of most uncut diamonds, platinum group metals and other precious metals and ores.
In other precious metals, silver rose as high as $12.93 an ounce, its highest since January 3, before easing to $12.85/12.92. It closed at $12.78/12.85 in New York.
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Finance & Business
--------------------------------------------------------------------------------
Jan 15 2007 1:31PM
Russia's Central Bank forecasts increase in gold, forex reserves
MOSCOW. Jan 15 (Interfax) - Russia's Central Bank has forecast an increase of between $70 billion and $80 billion in the country's gold and foreign currency reserves in 2007.
"We have scenarios for 2007 where an increase in the reserves varies from 48 billion to 143 billion dollars. I believe that growth of between 70 and 80 billion dollars is most likely," the bank's First Deputy Chairman Alexei Ulyukayev told Interfax.
Last year saw a record increase of $118 billion in Russia's gold and foreign currency reserves. Adding to this early repayment of debts to the Paris Club of creditors means the Central Bank earned $140 billion, Ulyukayev said.
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Shortage of coins hits gold market
(in the middle east)
DISCERNING gold buyers have to make do without coins these days due to shortage in the local market, as the price of yellow metal again started increasing after a few days' stability.
Industry sources yesterday said there was a short supply of gold coins primarily due to their heavy demand in Dubai, the main regional source for gold.
The spurt in the demand of gold in Dubai is due to the ongoing Dubai Shopping Festival (DSF) during which jewellers offer special incentives and prizes to customers.
The manager of a leading Doha jewellery shop told the Gulf Times yesterday that gold coins were not available in most city outlets now.
"We have been facing a shortage in gold coins in the last few days. Normally, we get gold coins and other jewellery items from Dubai. But due to the DSF, there is no adequate supply from there," he said.
Sources said the greatest demand is for gold coins weighing 8gms or a [b]sovereign.]/b]
Gold coins of 2gm and 4gm are also available, mostly on demand.
They said another reason for the current shortage of gold coins was the long holidays due to Eid al-Adha.
"Imported gold needs to be certified by the municipal authorities before they can be sold in Qatar. The department did not function during Eid al-Adha. Hence whatever imports made could not be certified," an industry source pointed out.
Meanwhile, gold prices have again started climbing after a few days' stability.
Gold closed at QR70.50 for 22-carat and QR76.50 for 24-carat in the local market yesterday.
And for 10 tolas (116gm), the price was QR8580 yesterday. A few days ago, it was stuck at QR8,380.
Despite the rising prices the gold sales have been brisk as before, a jeweller said.
"Many see gold as a safe investment. And many customers think the gold prices are unlikely to fall, though they may not shoot up in the short to medium-term. Hence it is being considered a reasonably good investment," he said.
Industry sources said the business seen since mid-November was sort of "unprecedented".
Sales had gone up because of 15th Asian Games in Doha. Both visitors and residents seem to have contributed to this.
Jewellers said many visitors to the Games and athletes purchased gold during their shopping.
Expatriates who flew out on holidays taking advantage of schools closure during the Games had also purchased gold.
And towards the year-end, the gold sales have surged primarily because of Christmas, Eid al-Adha and the New Year, said A V Joju, an executive with Joy Alukkas Jewellery.
Joju said though there was no marked difference in gold price worldwide, many expatriates, particularly non-resident Indians, buy the yellow metal from the Gulf due to the "guarantee on quality".
Also, a wide range of designs was available in jewelleries across the Gulf.
A jeweller said the prices might not remain stable in the coming weeks due to the current fluctuation in crude oil price.
"The price of oil has a bearing on the gold price in the international market. So, the price of yellow metal will depend on how the crude price moves," he said.
In the last two years, prices in the international market have more than doubled, causing a sharp decline in the metal's retail business.
This was due to a combination of factors including skirmishes in many regions, declining bank interest rates and bearish run in capital markets worldwide.
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Zimbabwe police arrest more than 22 000 miners, kill one
Monday January 15, 2007 06:29 - (SA)
Phumza Macanda
Police in Zimbabwe have arrested 22554 illegal miners and dealers since November, seizing large quantities of gold, diamonds and emeralds as the authorities step up their campaign to quash mineral leakages, it was reported on Friday.
More than 7000 diamonds and 80 emeralds, as well as 3,5kg of gold, have been seized by the police since the start of a police operation dubbed Chikorokoza Chapera, which means no illegal panning, on November 21, said the state-controlled Herald newspaper.
Most of the arrests occurred near Zimbabwe’s borders, fuelling suspicion that the country’s minerals were destined for foreign markets, where they would fetch a higher price, the Herald said.
Meanwhile, the state-controlled Chronicle newspaper said on Friday that police had confirmed the death of Shurugwi gold panner Elliot Noruware, who was shot and killed on Thursday by a police patrol.
The search for gold and diamonds has become an attractive option for thousands of Zimbabweans who are struggling to make ends meet in a tough economic environment.
But the cash-strapped authorities are desperate to harness the foreign currency that sales of precious minerals should rake in and have mounted a tough campaign to curb leakages.
Reports on Thursday said the government last week tightened its laws to impose mandatory jail terms of up to five years on people convicted of illegally mining and dealing in gold and precious minerals.
....Zimbabwe, as you may recall, is suffering from hyper-inflation. While the article mentions the illegal miners are 'struggling to make ends meet', it should have read 'struggling to keep from starving from the lack of buying power of their currency'. Notice how the miners were trying to get their hands on gold and jewels instead of the local currency?
it is a shame Wall Streeters still think paper is king and gold is junk instead of the other way around. |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 01/16/2007 : 18:17:06
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Gold Prices Hemmed In
Gold was caught in an economic tug-of-war Tuesday, with traders weighing a dipping oil price against higher inflation figures out of the U.K., leading to a choppy session.
February-dated contracts lost a dollar to close at $625.90 an ounce on the Comex division of the New York Mercantile Exchange. The bullion exchange-traded funds, streetTracks Gold Shares (GLD - news - Cramer's Take - Rating) and iShares Comex Gold Trust (IAU - news - Cramer's Take - Rating), were moving down, off 0.1% recently.
Saudi oil chief Ali Naimi indicated production cuts by OPEC might not be necessary, thus leading to a softer price for crude. Oil dropped $1.78 to $51.21 a barrel. That news provided support for the bear case.
Energy costs are a key component in inflation, and when they fall, the risk of rising prices is mitigated. Gold is bought by some investors as a hedge against inflation.
At the same time, even though reduced energy costs may mean lower inflation going forward, prices were rising their fastest in more than a decade in Britain, with the consumer price index hitting 3% growth in December. Because the advance was well above the Bank of England's target rate of 2%, it was making a bullish case for gold.
"The recent 3% level recorded in Britain means that it takes only about a decade to melt away a third of one's wealth," writes Jon Nadler, an analyst at Montreal-based bullion dealer Kitco, in a research report.
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Positive outlook for gold
Gareth Tredway
Tue, 16 Jan 2007
Gold was still trading near two-week highs by the time the US market had opened on Tuesday and market watchers predict that dips would be supported.
In a daily note, Nedbank Treasury said that while gold had come off its previous two week highs, "the downside should, however, be capped by bargain hunters and on demand ahead of the Chinese New Year".
On Monday, John Meyer, a mining analyst at Numis in London, said that a weak US dollar in 2007 could drive gold prices higher.
Falling dollar will boost gold
"A fall off in the US dollar is likely to take place this year as the economy slows, and the overhanging deficit pushes down the value of the currency," said Meyer in a note, adding that geopolitical tensions could also positively impact prices.
The dollar, with which the gold price was closely correlated during periods of last year, was slightly weaker against the euro following a lower than expected Empire State Index figure for January which represents New York state manufacturing conditions for January. Meanwhile, oil continues to fall following statements out of Opec member, Saudi Arabia, that further emergency production cuts were not required.
By 4.27pm on Tuesday, Gold was up $1.45 at $627.80/oz from a previous close of $626.50/oz. The metal started the year at over $635/oz.
The dollar was at $1.2935 against the euro, compared to $1.2934 late on Monday. Last Friday, the dollar strengthened to $1.2864/euro, a level last seen on 22 November.
Brent Crude near term contracts were last trading at $52.84 per barrel, compared to a 2006 average price of about $66 per barrel.
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Gold to edge up in 2007, silver to outperform
LONDON (Reuters) - Gold will eke out modest gains in 2007 and 2008 due mainly to expectations of dollar weakness, but its performance will be far less impressive than in the past couple of years, a Reuters poll showed on Tuesday.
The global poll of 42 analysts carried out over the past month forecast a median price for gold of $651.25 a troy ounce in 2007, up 6.4 percent from a median average of $612.10 in 2006 but down nearly 6 percent from the 2007 price forecast in the previous poll undertaken in July last year.
Prices were seen up by just over half a percent more to $655 in 2008. Gold rose by 23 percent in 2006 and by 18 percent in 2005. Spot was trading around $625 on Tuesday.
Silver, by far the top performer in 2006, also had the strongest growth potential in 2007, but platinum was seen down around one percent and by another nine percent in 2008.
"Gold will have a solid but not spectacular 2007. Commodities as an investment class are getting increasingly disparate, with first gas, then oil and now copper falling off the wagon," said Matthew Turner, analyst with UK consultancy Virtual Metals.
"This must be making investors nervous about the rest."
Many analysts expected the dollar to weaken further against major currencies, making dollar-priced gold cheaper for holders of other currencies and lifting demand.
"We see metals prices (base and precious) peaking around the middle of this year...assisted by our view that the euro/dollar trades to $1.40 by the middle of the year," said John Reade, head of metals strategy at UBS Investment Bank.
Early on Tuesday, the euro was trading at $1.2954.
In May 2006 gold prices soared to $730, a 26-year high, but subsequently failed several times to recapture that level.
Analysts predicted restricted official sales -- notably from the signatories of the European central bank gold agreement, a pact that limits sales by some of the world's biggest holders of gold to 2,500 tonnes annually.
"It is difficult to see who is going to fulfill the quota over the next three years of the agreement," said Nick Moore, global commodity analyst at ABN AMRO.
Geopolitics were gold's wild card. Several analysts noted the potential for further tensions in the Middle East, notably Iran. Many remembered that the Middle East was a major factor when gold hit its record high in 1980.
Many analysts were not expecting the impressive growth rates of exchange-traded funds (ETFs) to be repeated in 2007.
Those products, allowing investors to own a share of a physical metal traded on a stock exchange, now held just over 600 tonnes of bullion -- classing them as the world's 10th largest gold holder and on a par with China's gold reserves.
SILVER SHINES, PLATINUM DULL
Investors were seen continuing their love affair with silver this year. Prices rose 46 percent in 2006 thanks to the launch of a silver ETF that accomeulated 3,700 tonnes of the metal.
Silver was forecast 7 percent higher at $12.50 in 2007, but was seen softer in 2008 at $11.93. Two years ago, silver traded between $6 and $7 an ounce.
"We...expect the fresh inflow of investment assets to somewhat tighten the physical availability over time and result in short-lived but ample upside rallies," said Frederic Panizutti, analyst at Switzerland's MKS Finance SA.
MKS said silver could move toward $18 in 2007, but did not expect it would hold at such lofty levels for very long.
Others were much more bearish, due mainly to expectations of strong supply growth linked to soaring industrial metals prices.
"There's ample supply of silver mined in China as a by-product of lead and zinc. It's keeping pace with demand, meaning that Chinese industrial demand is unlikely to suddenly drive up international prices," said Heqing Shi, analyst with China's state-owned research group Antaike.
Platinum <XPT=> was forecast at $1,125 an ounce in 2007 and $1,020 in 2008, versus $1,138 last year. Despite expectations of lower prices, analysts said demand and supply fundamentals would support the market.
Demand growth would come from platinum's major user, the automobile catalyst sector, aided by changing legislation for cleaner exhaust systems. Use by the jewelry sector, undermined by high and volatile prices in the past year, might pick up again as consumers adjusted to the new and higher levels.
"As soon as the price falls, the Chinese love the stuff, and they'll buy it...that will form a base for platinum," Briggs of SGCIB said.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 01/18/2007 : 18:56:54
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No major news to report, gold and silver are just trading as usual, the prices ebb and flow like the tides.
Precious metals underpriced? If so, then it is a good time to add to our collections.
Foreign demand news. Any new demand will effect prices
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IOB rolls out gold coins
VIJAYAWADA : The Vijayawada regional office of the Indian Overseas Bank (IOB) on Thursday launched retail sale of gold coins to meet the increasing demand for pure gold. Chairman of Laila Group of Companies Gokaraju Gangaraju inaugurated the sale at the Seetharampuram branch of the IOB.
Speaking to media persons, IOB deputy general manager A. J. Prasad said the sale was launched simultaneously in 13 branches of the region. In Vijayawada, the coins would be sold at Andhra Loyola College branch, Governorpet branch, Krishnanagar branch, Ring Road branch and Vijayawada branch. In Guntur, they would be sold at Brodipet branch, Chandramouli Nagar branch, Guntur main branch and Nallapadu branch. The remaining branches are in Nellore (two), Anantapur and Kothagudem.
Explaining the salient features of the coins, Mr. Prasad said they were made in Switzerland with 999.9 purity. Produits Artistiques Métaux Précieux (PAMP), a leading Switzerland-based refiner of precious metals, minted the coins, which would be available in the denominations of 4, 8, 20 and 50 grams. The coins would be sold in a packed form with tamper proof `certificards' duly certified and designed specially for the IOB.
"The price of each coin will depend on the bullion rate prevailing in the market at the time of purchase," Mr. Prasad said. Mr. Ganga Raju appreciated the bank's effort in introducing innovative schemes and exhorted the general public to make use of such customer-friendly products.
Mr. Prasad said the bank was offering tailor-made products such as easy trade finance, Alankar scheme for women for purchase of jewellery along with a host of other products. "In Vijayawada, we launched IOB-Alankar loan scheme for women to purchase jewellery up to Rs. 2 lakhs," he explained. Explaining the performance of the region, Mr. Prasad said under priority sector, Rs. 270 crores had been distributed to housing and Rs. 32 crores towards educational loans. "Nearly 4,900 self-help groups have been financed to the extent of Rs. 31 crores," he said.
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Over R2 billion of gold smuggled out of SA
January 18, 2007, 18:00
Close to R2 billion of gold is stolen and smuggled out the country every year and about R250 million worth of platinum is lost to organised crime. These are some of the findings of a recently published report which was conducted by the Institute for Security Studies on behalf of the Chamber of Mines.
The bulk of the theft of precious metals happens after the ore has been brought to the surface. Platinum has a much smaller market and only five known syndicates operate in the industry.
As many as 17 syndicates steal gold from the mines. They supply it to five other syndicates who then ship it out of the country. The gold industry has suffered a serious blow from the dramatic strengthening of the rand a couple of years ago. Theft is making things worse.
Chris Hart, a senior economist at Absa, says the gold mining industry is in decline and there are major viability problems. The theft threatens the viability of a number for marginal mines. One would ask, over the last few years how many mines will not have closed down if the product was not stolen. The report recommends greater protection of mining operations by the government.
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Gold price higher in Hong Kong -- Jan. 18
he gold price in Hong Kong went up 97 HK dollars to 5,881 HK dollars per tael on Thursday, according to Bank of China (Hong Kong).
The price is equivalent to 632.94 U.S. dollars a troy ounce, up 10.04 U.S. dollars at Thursday's exchange rate of one U.S. dollar against 7.7995 HK dollars.
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Edited by - pencilvanian on 01/18/2007 19:04:00 |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 01/20/2007 : 22:12:37
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a little bit out of my price range
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No takers for university’s leftover gold
Madison: Looking for a ball of gold thread leftover from a university space experiment? Apparently nobody else is either.
A Thursday night deadline passed with nobody bidding the minimum $8,500 for the shiny glob of pure gold leftover from equipment University of Wisconsin scientists made that travelled into space in 2005.
The school's Space Science and Engineering Centre is auctioning off 12.5 troy ounces of 99.999 percent pure gold on a website where the university's surplus property — everything from dorm refrigerators to computers — is sold to the highest bidder.
Mark Mulligan, a project manager at the space centre, said the $8,500 asking price, which reflects the going rate for gold, was probably too high. He said he would lower the price and put the gold back up for bid early next week.
Mulligan said he was convinced the gold would eventually sell. A handful of people inquired but were scared away by the price, he said.
"We just got to get the pricing right," Mulligan said. "It is gold. You can do with it what you would like."
University scientists bought the spool of gold thread to use in making a refrigerator that kept instruments on satellites on two Japanese-American rockets cool. A first rocket launched crashed into the Pacific Ocean in 2000, but a second in 2005 was successful and the equipment worked, Mulligan said.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 01/20/2007 : 22:27:14
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Gold price to rise on growth of investor interest
By: Rhona O'Connell
LONDON (Mineweb.com) --GFMS Ltd, in its second (January 2007) update to the Gold Survey 2006, believes that the gold price should track higher over the coming months and that investment activity would be the prime driver of any such rally. Chief Executive Paul Walker, presenting the Survey at its launch in Toronto on January 18th, commented that “we’re fully expecting investor buying to come back in force, mainly in response to actual and potential dollar weakness. A slowdown in the US economy and disappointing returns in conventional assets, such as equities, should lift gold”.
With respect to absolute price levels, he noted that “we should be seeing prices getting into the $670s in the first half, although it is less certain we will see the recent high of $725 surpassed. That could still occur, maybe further into the year or possibly in 2008, especially if the situation in the Middle East deteriorates significantly, driving prices higher”.
The main supply and demand fundamentals are expected to underpin prices, and the Consultancy sees little threat from profit taking.
On the contrary, physical buyers are expected to provide a degree of robustness, driven in some part by the buoyancy of economic growth in countries such as India and China. This follows from a weak first half for jewellery demand in the first half of 2006, but a substantial improvement in the second half.
Further support is expected from official sector sales and the return of old scrap (as opposed to new scrap, which constitutes, for example, gold sweepings from within a factory and therefore which go back into the fabrication process without previously coming out into the market as a fabricated piece). GFMS estimates that official sector sales were halved in 2006 and are likely to remain subdued in 2007, as a result of signatories to the second Central Bank Gold Agreement significantly underselling their quota, as well as occasional purchases from outside Europe. This latter, however, does not as yet include any expectations of purchases by the dollar-rich East Asians.
GFMS estimates that old scrap returned rose by approximately 20% in 2006, largely in the first held and in response to the increase in price, but this is expected to fall by approximately 20%, year-on-year, in the first half of 2007. Dr. Walker stated that “you would need a price well into the high $600s to see any sizeable pick-up in scrap. Much of the loosely-held jewellery was shaken out during the April/May price spike last year and people have come to see $600-650 as quite ordinary levels”.
The only two negatives noted for the price in Update 2 concern mine output and producer de-hedging. The 2% fall in mine production in 2006 was mildly price-supportive, but GFMS expects to see a modest rise in 2007, largely as new projects come on stream or ramp up to full capacity. De-hedging, was thought to have been an important factor behind initial price strength last year in response to the Barrick buy-back of the legacy hedge position from the Placer acquisition that took the first-half total to almost 300 tonnes. Overall dehedging is expected to return to a more normal rate of under 200 tonnes in 2007, subject to fresh corporate activity bringing about another shock. The report notes, though, that there is little evidence of interest in non project-related hedging, despite the widening contango.
The statistical highlights of the report include the following:
Mine production in 2006 was down by 2% to 2,467 tonnes, a figure slightly lower than once expected. Marked losses were seen in the three largest producers (South Africa, Australia and the United States) and Indonesia. Gains were registered in China and many countries in Latin America and Africa. First half 2007 output is forecast to show modest year-on-year growth.
Weighted average cash costs rose by 13% year-on-year in the nine months to September, largely as a result of high energy costs, and higher prices for steel, cement and mining reagents.
Net official sector sales in 2006 are estimated to have halved to 330 tonnes, while estimated scrap supply rose by almost 200 tonnes over the year as a whole. Scrap supply is expected to be more than 130 tonnes lower in the first half of this year than in the first half of 2006.
On the demand side, jewellery fabrication slumped by over 400 tonnes in 2006, largely in response to higher and more volatile prices. If jewellery fabrication net of scrap is considered, however, the fall was more substantial, with the first half shedding 40%; losses were greatest in the Middle East and India, which are particularly price-sensitive. Substantial losses were also recorded in Italy (which is a leading fabricator, supplying demand in any number of countries around the world) and also East Asia, but with the exception of China. Other fabrication, by contrast, grew by over 10% in 2006, chiefly through higher and electronics demand.
Jewellery demand is expected to show a slight retreat in the first half of 2007.
In the investment sector, there was a notable shift in business from the exchanges to the over-the-counter market. Bar hoarding, meanwhile, eased to just over 230 tonnes, with a sharp drop in Japan outweighing improvements in India and Vietnam. World investment is expected to surge in the first half of 2007.
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'Scope for gold to hit $850'
London - Gold will struggle to break out of its current trading range in the short term and may slip towards $600, but price charts signal a big rally later this year.
Chart analysts, who predict future price moves by tracing past market performance, said gold might move closer to its record high of $850 an ounce, last seen more than a quarter of a century ago, in the second half of 2007.
"The market is going sideways and is in a long-term uptrend. Ultimately, there should be quite bullish price action later this year," said Phil Roberts, analyst at Barclays Capital.
"You need to take out the $650-$675 area to really get things going again and trigger a move to probably $800 and higher," he added.
On Friday spot gold hit an intraday high of $628.90 an ounce and was at $628.40/629.40/oz by 05:06 GMT, up slightly from late New York levels of $628.00/629.00/oz.
The metal has traded in a range of $600-$650 over the past 11 weeks. Gold hit a 26-year high of $730 in May last year only to tumble more than $100 over the next month.
"The bigger picture is that the eventual move will be... a move through $725, but we will have to wait and see how that develops," said Robin Wilkin, technical analyst at JP Morgan.
A global poll of 42 analysts, carried out by Reuters over the past month, forecast a median gold price of $651.25 in 2007, up 6.4% from a median average of $612.10 in 2006. The highest average price for a quarter was seen at $780 by one analyst.
Karen Jones, analyst at Commerzbank, was more cautious.
"Although generally positive longer term, we suspect that the $730 high will not be surpassed in 2007 and that the market may simply consolidate within the $560 to $730 range," she said in a weekly market report.
Sideways in short-term
The market was expected to stay locked in a range in the near term, with potential to move in either direction.
"We might have a bit of correction coming through in the very short term - in the next week or so. There are a lot of resistance levels before we can go up towards $850," said Michael Widmer, analyst at Calyon Corporate & Investment Bank.
Analysts noted the market's failure to build on a recent rally.
Gold jumped more than 5% to $644.90 in early January, but fell some 7% in the next two days.
"The market, generally speaking on a short-term basis, is effectively trapped within a fairly well-defined narrowing consolidation pattern we have been in since the summer," independent metals analyst Cliff Green said. He said the metal might face pressure in the short term, but a break of $600 or $650 could inject new momentum into the market.
"The market is dull for the time being, but later on this year we think it's going to be a lot more exciting," Roberts of Barclays Capital said.
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The new demand for gold
Excerpt
Expect the demand for gold to increase, with the launch of two new gold exchange traded funds in India. And this in turn will most likely underpin the price of the yellow metal.
Rudi van der Merwe:
Good evening Bruce, yes that is quite right, we had quite a strong day. The market rebounded after a bit of a sell-off yesterday. I think there was some relief after the Bank of Japan didn't raise rates last night and generally we saw the currency going a little bit stronger.
There possibly had been a bit of a sell-off yesterday on the possibility of the Bank of Japan hiking rates and then the gold price also recovered somewhat overnight to back over $630 and the financials and resources really did quite well today.
Bruce Whitfield:
I was talking to David Shapiro earlier and David Shapiro saying India has announced two new exchange traded funds on gold and that naturally will get a lot of investors in gold quite excited.
Rudi van der Merwe:
Bruce yes, there has been a massive pickup in the amount of gold held by exchange traded funds since they started off and I think they are in the top 10 if one would count them as a central bank, so it is very significant holdings. We saw what happened last year when there were rumours about a platinum exchange traded fund, so certainly any news on exchange traded funds in gold is going to underpin the price and it certainly seems like that helped.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 01/23/2007 : 20:10:53
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I have decided not to say anything about the price of gold or silver so as not to jinx it, but I put this thought on this topic section as food for thought.
There are some nay sayers who laugh at the idea of gold going to $900-$1000 per ounce. While every fool is entitled to their own fool opinion, to adhere to the advice of such fools ignores gold's recent history in relation to paper money.
One hundred years ago, a person needed two $10 dollar bills to exchange for one Double Eagle gold coin.
Fifty years ago, a person needed five $10 dollar bills to exchange for a Double Eagle.
Today a person needs over sixty $10 dollar bills to exhange for a Double Eagle in its lowest grade, poor condition/scrap value.
Considering how the price keeps going up over the long run, what do you suppose the price will be fifty years from now, provided the US Dollar is still worth anything?
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 01/30/2007 : 19:02:55
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IMF gold trading rule changes set to boost the gold price
The International Monetary Fund is in the process of revising the laws that govern the trading of gold by the world's central banks which will radically change the ability of central bankers to suppress the gold price, a major factor depressing the price of the yellow metal that has been an open secret for years.
This sort of systemic market reform will likely have a huge impact on the gold market.
It is like the 'Big Bang' changes to world stock markets that started in the 1980s and led to an explosion in equity ownership and higher price-to-earnings ratios.
That gold prices have been artificially depressed for decades is not hard to establish. Consider the nominal peak oil price last year of $78-a-barrel, twice the previous nominal peak value reached in 1980. Gold by comparison hit $725 an ounce last year, yet is still below its nominal peak value in 1980.
What has been happening is that central bankers have been swapping and loaning gold in the gold market to keep the price down to produce another false indication that inflation is under control.
Some analysts allege that they have actually now lent considerably more gold than they have in their vaults, so the world's gold's reserves are smaller than reported; and the lack of gold audits from central banks just adds to this suspicion.
IMF review
The IMF has been reviewing all aspects of the gold trade by central banks for the fifth edition of its Balance of Payments Manual which includes the regulations governing gold swaps and loans. IMF officials told ResourceInvestor.com that a draft edition will be posted for worldwide comment within two months.
It remains to be seen whether the central banks now manage to sabotage this attempt to control their alleged gold market manipulation.
But the very publication of the draft rules, which have clearly been endorsed internally by the IMF, throws down a major challenge to the banks.
For gold traders, and even the general public, the suppression of the gold market is pretty obvious.
Market news that should move the gold price up is often anticipated by the central banks which appear to shuffle a few transactions between themselves to send the price in the opposite direction.
Gold cartel to fall?
But such is the growing size and interest in the gold market that participants are increasingly ganging up in protest at such blatant manipulation that would not be tolerated in any other financial market.
It looks as though the IMF has decided that enough is enough and decided to call it a day.
The ending of any price suppression or cartel in a market is usually a bullish signal. What would the gold price be in a free market without the central banks swapping and loaning gold amongst themselves?
Well, it does not take much imagination to see that a rebalancing of gold's position relative to other assets and currencies would follow.
That the IMF has now put the gold market out for open discussion is clearly the first step towards a new era for the yellow metal.
How long that era will take to arrive is still a matter of conjecture.
But the idea of stocking up on gold while prices are still low has intrinsic appeal; or buy silver or other precious metals which would also rise alongside the gold price, perhaps even higher.
.........(We shall see what the future holds for silver and gold, but if history is any kind of guide, both metals will be anchors for one's ship of financial health.) |
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n/a
deleted
479 Posts |
Posted - 01/30/2007 : 20:24:54
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I too noticed the IMF announcement.
Perhaps my inability to focus, my tendency to skim rather than read, or my pure thick headedness has prevented me from understanding exactly what rule changes are being considered. OR Perhaps they are being tight lipped about the details of the rule changes.
Does anyone here understand what the rule changes are supposed to be?
Do we even know what the old rules are?
.................................................
A billiard ball dropped from 1,362 feet (height of the South Tower) in a
vacuum would require 9.22 seconds to hit the ground. How then did the
towers collapse in 10 seconds and 11.4 seconds, and why has not one
member of the mainstream media insisted on honest answers from the
government in this regard?
"The individual is handicapped by coming face to face with a conspiracy
so monstrous [that] he cannot believe it exists."
- J. Edgar Hoover |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 01/31/2007 : 18:14:18
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The law of mentioning something:
When you want something good to happen and you mention it out loud:
it won't happen 
When you Don't want something bad to happen and you mention it out loud:
it happens 
For this reason, I will not mention one word about the price of metals, I will simply reprint interesting news concerning metals (you know what metals I am talking about, I guess.)
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IMF urged to sell gold to battle cash crunch
A panel of financial statesmen advised the IMF to sell 400 tons of its gold reserves as part of a new strategy to avert a long-term crunch in its finances.
But the International Monetary Fund should proceed with care in selling any gold to avoid destabilizing world markets, the panel members including former Federal Reserve chief Alan Greenspan recommended.
The IMF has more than 3,200 metric tons of gold as part of its financial stockpile, but has fought shy of offloading any of it. The sale of 400 tons could raise 6.6 billion dollars at current market prices, the panel said.
IMF chief Rodrigo Rato appointed the panel in May last year to come up with ideas to avert a cash crisis for the global lender, which has seen its operational income slump as debtor countries repay their Fund loans early.
The committee was chaired by Andrew Crockett, former head of the Bank for International Settlements, and also included European Central Bank president Jean-Claude Trichet and People's Bank of China governor Zhou Xiaochuan.
It said the IMF should also broaden its investment mandate, with a view to generating extra income of 45 million dollars a year on capital markets.
And the IMF could invest part of the annual dues paid by its 185 members, yielding a potential 300 million dollars a year, the panel's report said.
"If adopted, the measures would set the Fund's finances on a sustainable basis, and ensure a solid financial foundation for the Fund's important role in the international community," Crockett said.
Rato welcomed the recommendations, which will be taken up for debate by the IMF's executive board.
"The report represents a key milestone in our work and is an important step in developing an appropriate new income model," he said.
Money from the gold sales should be put in an endowment fund, which could yield annual investment profits of 195 million dollars, the report by Crockett's panel said.
"The committee emphasizes that these limited gold sales should be handled in a way to avoid causing disturbances to the functioning of the gold market and, accordingly, should be coordinated with current and future central bank gold agreements so as not to add to the volume of sales from official sources."
The IMF's finances have become strained as more and more clients emerge from years of economic crisis, during which they became reliant on its bailouts, to stand on their own feet.
The latest country to exit IMF supervision is Ecuador, whose new leftist government said this month it would pay back its 33-million-dollar debt early, so depriving the Fund of income from interest repayments.
The IMF expects to post an operating shortfall of 105 million dollars in its current fiscal year through April, with 67 million of that linked to early repayments from Indonesia, Serbia and Uruguay.
To plug an immediate shortfall, the IMF said last May it would transfer its reserves of 8.7 billion dollars into a new investment account to generate extra returns on the bond markets.
But Rato noted at the time that the IMF needed to come up with long-term solutions to its funding problems.
.....(I guess nobody remembers the consequences when the Bank of England sold its gold at the bottom of the market, Did the person who suggest that idea get a promotion?)
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China's gold buying stays flat in 2006
BEIJING: China consumed about 240 tonnes of gold in 2006, roughly unchanged from the year before, as increased wealth offset higher prices that had caused buying in most countries to drop, the World Gold Council’s Far East MD said on Tuesday.
Gold buying in China rebounded in the fourth quarter, he said, after a 25-year peak price of $725 an ounce depressed buying by 2% in the second quarter from the year before.
“The fourth quarter was much better. It was very, very good, actually,” Albert Cheng, the council’s Far East MD, said. China’s economy grew by 10.7% in 2006, helping gold demand stay stable despite the high prices. In 2005, China’s gold consumption rose 7.7% to 241.4 tonnes, according to council figures.
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Edited by - pencilvanian on 01/31/2007 18:21:57 |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 02/02/2007 : 17:43:05
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Maybe it's me, but it seems that gold usually takes a fall every friday, it is almost like every friday is friday the thirteenth for gold & silver.
Could it be speculators are selling on friday and using the proceeds to enjoy the weekend?
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Gold Drops From Six-Month High on Speculation Rally Is Overdone
By Pham-Duy Nguyen
Feb. 2 (Bloomberg) -- Gold prices in New York fell the most in almost a month on speculation a rally to the highest since August was overdone.
Gold rose 3.9 percent in January. The metal yesterday climbed to $667.20 an ounce, the highest in almost six months. Prices touched $603 on Jan. 5.
``Gold's up $50 on the year, so there'll be profit-taking,'' said Frank Lesh, a trader at FuturePath Trading LLC in Chicago. ``We're all getting rewarded for buying dips.''
Gold futures for April delivery fell $11.50, or 1.7 percent, to $651.50 an ounce on the Comex division of the New York Mercantile Exchange. The percentage drop was the biggest since Jan. 5. Prices climbed 80 cents this week, paring gains in the past three days.
A futures contract is an obligation to buy or sell a commodity at a set price for delivery by a specific date.
The seven-day relative-strength index for gold futures climbed to 79 yesterday. A reading above 70 generally means traders expect prices to drop. The measure was at 75 the previous day.
``Pulling some chips off the table is the name of the game,'' said Jon Nadler, an investment-products analyst at Montreal-based Kitco Minerals & Metals Co. ``Profit-takers are hitting the metal with one sell order after another.''
A strengthening dollar(?) also hurt gold. The metal, sold in dollars, generally moves in the opposite direction of the U.S. currency, which gained the most against the euro in more than a week after a government report showed a revision in payroll numbers.
January Payrolls
Employers added 111,000 non-farm workers to payrolls in January, compared with a revised 206,000 in the prior month. Average hourly wages rose 0.2 percent.
..........(And we all know how accurate and truthful the government figures are, now don't we?)
A better-than expected payroll number released on Jan. 5 triggered a 3.1 percent drop in gold prices that day.
``The revision is what hurt the euro and gold,'' said Jim Pogoda, an investor in Summit, New Jersey, and a former precious- metals trader for Mitsubishi International Corp.
Gold gained 23 percent last year while the dollar dropped 10 percent against the euro.
A decline in industrial metals also pushed gold lower. On the London Metal Exchange, zinc dropped as much as 12 percent and copper tumbled as much as 6 percent.
The Wall Street Journal reported today that Red Kite Management Ltd.'s $1 billion metals-trading hedge fund lost 20 percent this year. The newspaper cited an unidentified investor who has seen the firm's results as of Jan. 24.
Base Metals
``Gold is being dragged down by the base-metals complex,'' said Michael Guido, director of hedge-fund marketing at Societe Generale SA in New York. ``It's primarily a base-metals fund. People are worried about the ramifications.''
Still, gold may rebound as energy costs gain, the dollar weakens and turmoil in the Middle East disrupts financial markets, analysts said.
``Now is the time to accomeulate, particularly on any weakness,'' said Adrian Day, president of Annapolis, Maryland- based Adrian Day's Asset Management, which has $113 million in assets.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 02/05/2007 : 17:53:34
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Gold news for Canadians, whether this is good or bad news is up to you.
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CORRECTED: Product offers Canadians retirement gold
Mon Feb 5, 2007 2:50 PM EST
By Susan Taylor
OTTAWA (Reuters) - Canadian investors can now hitch their retirement fortunes to the price of gold with a product that lets them buy and sell gold coins and bars in their tax-deferred retirement savings accounts.
Spearheading the product are online bullion dealer Kitco Metals Inc. and online brokerage Questrade Inc., which say their offering is a first in Canada.
It enters the market amid a recent rise in world gold prices. Spot gold <XAU=> hit a six-month high of $661.50 an ounce last week, but edged back to trade slightly below $650 an ounce on Monday.
"Everyone's looking at gold now," said Kitco president Bart Kitner. "When gold was $260 an ounce, the major media didn't even talk about it, analysts would just brush it off as something that was not even worth looking at. But that's changed."
Until 2005, when the government bowed to a request by the Royal Canadian Mint, Canadians could not hold precious metals in registered retirement savings accounts.
Even after the policy change, it took time to organize a product that did not involve mining company shares, funds and certificates, and would allow investors to buy, hold and trade real gold in their registered retirement and registered education savings plans, Kitner said.
Under the arrangement, Questrade processes investor orders, which are then placed with bullion trader Kitco, which supplies the gold to the Mint. The Mint then refines the gold, to a minimum 99.5 percent purity, and stores it in its vaults.
"What we like is that precious metals, or the mining industry, in Canada is quite significant and it's very important to our country as a whole," said David Madge, the Mint's executive director of bullion and refinery services.
Questrade said it has modest expectations for the new offering, which is part of its effort to expand its customer base beyond hard-core traders to mainstream investors.
Canadians can open a registered retirement savings plan with no annual fee at Questrade's Web site, then place orders to buy or sell gold, either online or over the phone. Customers pay C$9.95 ($8.42) a transaction and 10 Canadian cents a month, per ounce, to store the metal.
Gold is seen as a safeguard against currency drops and stock market volatility.
"Gold has traditionally, for centuries, been a storehouse of value," said Questrade chief executive Edward Kholodenko. "Gold is never going to go to zero."
The recently launched product already has a few customers, and the venture partners hope it will eventually mirror the success of similar offerings in the United States.
"Once an investor has decided that gold is the right investment for them and they've chosen to go with the physical (gold), I think the fact that you can now do it and get a tax deduction is a huge benefit," Kitner said.
There is a March 1 deadline for contributions to qualify for a tax deduction on a 2006 Canadian income tax return.
........I have heard of gold backed IRA accounts and gold backed Certificate of Deposits in the US, but I have never tried to get one. (I would rather have the bullion in hand than in a bank somewhere, although that is just me)
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Gold rebounds, eyes US dollar
05/02/2007 10:28
Singapore - Gold bounced on Monday on bargain hunting after falling more than 1% in New York but a firmer US dollar weighed and investors awaited more direction from the currency market.
Spot gold hit an intraday high of $649.65/oz and was at $648.30/648.80 by 04:00 GMT, up from $647.00/647.70 late in the US market on Friday, when it tumbled $10 because of a higher dollar.
"We saw some buying from the Japanese once Tocom opened. But I can say, there's not much business ... just a little bit of buying," said Louis Lok, a dealer at Bank of China in Hong Kong.
Benchmark gold futures on the Tokyo Commodity Exchange, currently December 2007, fell ¥28 per gram to ¥2 539, having risen to its highest level in more than eight months at ¥2 569 on Friday.
Cash gold has fallen around 2% since rallying to a six-month high of around $661 an ounce last week and was trading below a 26-year high of $730 hit in mid-May.
"The first resistance is around the 661.50 levels and on breaking that, markets may find the resistance around the $666 level," Pradeep Unni, analyst at Vision Commodities Services DMCC in Dubai, said in a note.
"Markets have to break and hold the $666 level to inch towards target zone of $680-685 levels. Crude near the $60 levels would give support to the markets," said Unni, who pegged the nearest support around $646/oz.
US crude futures extended Friday's gains, trading around $59 a barrel as cold weather in main consumer the US was forecast to continue through the week.
In the currency market, the dollar held to gains made on Friday, which were driven by a moderate rise in US jobs. Monday's Institute for Supply Management's non-manufacturing index for January and this week's G7 meeting on February 9-10 would be the focus of investors.
"The market consensus is for a decline in the headline reading and it's most likely the total index reading would continue to remain far below the November 2006 figure of 58.3 points," said Unni.
"However this is not likely to bring in a major decline in dollar as the data available from the US economy for the last couple of weeks point out the outlook remains bullish for US service sector on strong consumer demand and signals of a stabilising domestic real estate market," he said.
The euro dropped to $1.2937 - hovering below the psychologically important $1.30 level.
The dollar edged down to ¥120.82 but within range of ¥121.37 hit on Friday, when data showed the US economy added 111 000 jobs in January.
The G7 meeting in Essen, Germany later this week is in the spotlight because European officials have been pushing for discussion of the yen's weakness, although their Japanese and US counterparts have been playing down the issue.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 02/05/2007 : 18:32:25
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Gold prices get a boost from rising energy prices
Gold futures closed higher Monday, gaining nearly $5 an ounce as economic concerns related to the recent strength in energy prices helped drive demand for the precious metal.
Gold for April delivery closed up $4.60 at $656.10 an ounce on the New York Mercantile Exchange.
On Friday, gold closed down 1.7%, or $11.50, at $651.50 an ounce, after trading as low as $648. The contract had gained $5.10 on Thursday to mark its third-straight winning session, trading as high as $667, the contract's strongest intraday level since Aug. 9.
"Gold was rocked back on its heels on Friday ... by lack of follow-through by the funds," said Julian Phillips, an analyst at GoldForecaster.com. "Investment demand rose well, but physical demand backed off."
"The extent of the drop shook the market because it fell straight through resistance it had just broken through," he said, in an email interview. "We have to conclude that these were speculative plays as the gold price is now recovering through $650."
"If investment and physical demand are the forces behind the bull market, these speculative waves will keep the market very volatile, but the tidal flow of the market will dominate beyond the short term," he said.
Early Monday, April gold climbed as high as $657.50 "amid a recovery prompted by crude oil nearing $60 once more," Jon Nadler, an analyst at bullion dealer Kitco.com, wrote in a research note.
March crude prices touched a one-month high of $59.95 a barrel, then retreated from the day's peak, but March natural gas continued higher as icy conditions struck the Northeast.
"Resistance for gold remains to be found near the $655 area and such values must be overcome yet again in order to re-establish the previously bullish tone in earnest," said Nadler.
And "for the moment, gold must also maintain itself above $640 so as not to turn the mood sour and prompt buyers to hold out for the low(er) $600s," he said.
Other metals prices closed mainly higher. March silver added 18.5 cents to end at $13.56 an ounce. April platinum rose $8.20 to close at $1,171.70 an ounce and March palladium closed up $4.10 at $342.35 an ounce.
But March copper gave back 0.65 cent to end the session at $2.4165 a pound.
Hedge fund eyed
A report last week that Red Kite Management, a $1 billion metals trading hedge fund, wants to extend the notice period for investor redemptions after losses of as much as 15% in January, may further affect metals trading.
Red Kite, run by Michael Farmer, Oskar Lewnowski and David Lilley, asked investors in its metals fund to approve an amendment that would require 45 days notice before money can be withdrawn, according to a copy of a Jan. 31 letter from the firm obtained by MarketWatch.
"All eyes seem to be on whether funds are in trouble with another Amaranth-type sell-off, and given the sell-off in oil and the metals in early January, this would not be a surprise," said William Adams, an analyst at BaseMetals.com, in a daily note to clients.
"However, if the damage was done in January, then this may well be a 'sell the rumor, buy the fact' situation as the pain may already have been taken by the funds," Adams said.
For now, according to Nadler, it seems that gold has "shook off some of the stigma that may have rubbed off of base metals in last week's Red Kite fund debacle."
On the supply side, gold inventories declined by 402 troy ounces to stand at 7.49 million troy ounces as of late Friday, according to Nymex data. Silver supplies dropped 34,164 troy ounces to 113.90 million troy ounces, while copper stockpiles were unchanged at 36,169 short tons.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 02/06/2007 : 18:58:08
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Opinion of a Gold forecaster, perhaps biased, perhaps on the money, still worth considering.
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Dundee economist Murenbeeld says dollar diversification will turn to gold
CAPE TOWN (Mineweb.com) -- Respected metals price and currency forecaster Dr. Martin Murenbeeld Tuesday predicted a stronger gold price in 2007, an overvalued U.S. dollar currency, limited supply and higher gold investment demand.
During a presentation at 2007 Mining Indaba in Cape Town, Murenbeeld, Chief Economist of Canada’s Dundee Group, forecast a 2007 gold price ranging from $674 to $707 to $755 per ounce.
He asserted that the U.S. dollar exchange rate was significantly overvalued, ranging between 15% and 35%, while the current U.S. account balance had risen to 7% of GDP from 3% a couple of years ago.
Murenbeeld suggested that the current account deficit could improve if there was stronger economic growth in the rest of the world resulting in more U.S. exported goods, or if the United States consumed less on the back of weaker domestic growth.
The Chinese currency, known as the RMB, also needed to be revalued, according to Murenbeeld, who was waiting to see how this issue would be resolved.
He asserted that international U.S. dollar reserves were excessive as $4.8 trillion in currency reserves were estimated to be held globally. Asia now holds more than half of the world’s currency reserves.
“Diversification from U.S. dollar reserves would do wonders for the gold price, even if Asia does not increase their gold investments to an unlikely 15% of reserves, but only decides to buy a portion of the 500 tonnes of gold annually available from the Central Bank Gold Agreement (CBGA),” Murenbeeld said.
Also supporting the gold price is OPEC’s current account surplus that is rising – putting great pressure on the organization to diversify and divest more funds.
“Indications are that there will be further diversification away from dollars, as there are fears of further dollar currency declines and geopolitical trends, such as anti-US sentiment in the Middle East, do not exactly support the currency,” Murenbeeld explained. “But other markets are not cheap, and gold is now cheap at ten barrels of oil for an ounce and in terms of the cost of financial assets.”
U.S. monetary policy is likely to be eased in future, as budgets are stretched as the baby boomers retire, causing fears that the US economy will slow down, he said.
Declining or flat supply caused by the lack of mine expansion during the 1990s also casts a favorable light on the gold price.
There is currently only 4,000 tonnes of “loose” gold in Central Bank reserves available. Meanwhile, non-signatories to the Central Bank Gold Agreement, such as Argentina, have said that it would be buying gold reserves and not selling it.
Demand has risen over the past few years on the back of demand by exchange-traded funds (ETFs) and gold returning to its monetary investment role. Investor demand also picked up in India and as a result of deregulation elsewhere.
Murenbeeld said that gold price cycles generally lasted a minimum of 10 years, and that he was bullish on the price for at least the next four years. However, he cautioned, that one had to remember that a counter year occurred in each 10-year cycle.
On the downside, the gold price could suffer from tight monetary policy, a rise in real interest rates and the observation that the gold price often decreased during or after a recession.
Quote: the gold price could suffer from tight monetary policy,(something the Fed has never done and will never do)
a rise in real interest rates
(something the Fed can't do, unless it wants to pop the real estate bubble and cause a depression)
and the observation that the gold price often decreased during or after a recession.
(Recessions previously caused by US demand slacking off, but the US isn't the only engine of growth anymore, Asia, Brazil, Russia, even Europe are becoming the new engines of growth.
The day 'when America sneezes, the rest of the world gets a cold' are over. Too many nations are growing at greater rates than had ver seemed possible before. With all that growth there will be more middle class buyers worldwide, meaning less reliance on the US as the only growth factor to consider.
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Edited by - pencilvanian on 02/06/2007 19:05:04 |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 02/07/2007 : 17:58:29
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Gold fixing commentary
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Gold Price Manipulation - Does it Matter?
Clive Maund
Feb 7, 2007
There has been more talk in recent weeks on the subject of gold price manipulation.
The purpose of this article is not to attempt to go into the details of whether or not there is manipulation, or how much there is, or who is doing it or why, because all of this is/has been raked over by other writers in considerable detail.
The purpose of this article is to examine what difference it makes to us as investors and traders, and how best to live with it.
The first point to make clear is that to whatever degree there is gold price manipulation/suppression, there is nothing much the ordinary investor can do about it -
you are going to have to live with it, like taxation -
so there's no point in losing any sleep over it.
The next point to grasp is that there is a "might is right" issue here.
The plutocratic network responsible for gold price suppression knows that even if they are outed, they can simply brazen it out with an attitude of "Tough luck - there's nothing you can do about it".
When you understand this point you realize that those who have worked tirelessly for some years to expose what is going on will probably only ever achieve a pyrrhic victory.
Now here is the fundamental point to grasp, which is the central message of this article.
Even if it is proven beyond all doubt that there is a powerful conspiracy to restrain the price of gold, and even if, despite being dragged out into the light of day and branded, those responsible brazenly continue their operations,
they will nevertheless be rendered increasingly irrelevant by unstoppable market forces.
Take a look at the following chart, which shows the price of gold in Swiss Francs, and you will see that this is already happening, and the picture against the Euro is very similar.
They have already lost control, even if they had it - as we can clearly see on this chart, they lost it in mid-2005. All that is left to them now is to fiddle about on the edges trying to fleece traders by creating false breakouts etc and engage in their ritualistic Friday gold bashing.
What has and is happening is best understood not by considering high finance, and going into complex and long-winded economic arguments, but by considering the analogy of an ordinary fruit and vegetable market.
Suppose some regulatory body tries to cap the price of potatoes and there is an acute shortage. Unless it is prepared itself to ensure sufficient supply of potatoes to meet demand, the tables in the marketplace will empty and a vibrant black market will spring up offering potatoes at much higher prices.
This is the situation we have found ourselves in increasingly with gold since mid-2005.
There is growing demand for the metal itself worldwide and powerful players who know the score are not and will not be satisfied with scraps of paper
- they want to see the color of their money, and that color is gold - and silver.
In addition, smaller players are getting in on the act through the ETF's (Exchange Traded Funds). As the money in these funds expands it must be reflected in increased reserves of the metals and this is providing additional and increasing demand for gold and silver. In the face of increasing demand for the metals themselves, no amount of chicanery by conspirators attempting to suppress the price will succeed - short-selling, derivatives strategies, hedging by certain large gold producers, lying about and fiddling the figures for reserves in bank vaults - all of it will be swept aside by a good old fashioned groundswell of demand.
For practical purposes the arguments about whether the gold market is manipulated are largely a waste of time. So what if it is? - any market in which powerful players are involved is subject to manipulation to some degree, but even they must eventually yield to the overriding force of the primary trend.
.........( I Don't know about the last part, 'eventually the powers that be must yield to old fashiond demand', if the powers that be control the raw materials (OPEC) or are the 800 pound gorillas in their field,(ADM ,Microsoft) the powers that be can pretty much do whatever they want. It isn't until the masses catch on and start buying up gold and silver that the pries will skyrocket. Until then, keep adding to your hoardes, because the gold/silver euphoria days are still in the future. |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 02/08/2007 : 18:03:03
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Thanks for the link, Atheist.
Its always good to get another point of view in the world of metals, especially from the world of mining metals.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 02/10/2007 : 12:33:53
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More gold news/ commentary
Makes sense, though what seems reasonable and what actually happens in real life tend to be two very different things.
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The Casey Files
About Those Proposed IMF Gold Sales
As you have probably heard by now, a blue-ribbon panel recently advised the IMF to sell gold as a way of trying to clean up its finances.
The news initially spooked some weaker holders and hedge fund managers, most of whom are clueless about the overarching trends driving gold. However, as Doug Hornig makes clear in the following report, the proposed IMF sales represent much ado about nothing... other than perhaps creating a buying opportunity, that is.
-Doug Casey
The International Speculator
Lately the metals markets have been abuzz with speculation about the meaning, and implications, of proposed gold sales by the International Monetary Fund (IMF). It's a subject about which many of our readers are probably concerned, so we decided to take a look.
This potential development came about because the IMF finds itself on shaky financial ground. It is facing a shortfall of about $105 million this fiscal year (ending April 30, 2007), a deficit which is projected to balloon to $185 million in 2008 and $244 million by '09.
There are any number of reasons advanced for this deteriorating balance sheet, the most common one being that many formerly cash-strapped Third World countries are experiencing enough prosperity to make early repayment of loans - Indonesia, Serbia, Uruguay and Ecuador are among those doing so this year - thereby cutting down on the interest income the IMF relies upon to cover operating expenses.
Though that may be a central part of the problem, the IMF should take a long look at its own bloat as well.
In the past ten years, its annual budget has doubled to nearly $1 billion. As Devesh Kapur, an economist at the University of Pennsylvania, puts it,
"Costs at the fund have been allowed to get out of control. It now has a bigger staff and budget than its role justifies."
..........(Just like any bureaucracy, starts out small ends up huge)
Be that as it may, IMF officials determined that sources of revenue other than lending income needed to be developed. And thus the Committee to Study Sustainable Long-Term Financing was convened last May by IMF Chief Rodrigo Rato. Also known as the Crockett Committee - after Chairman Andrew Crockett, former director of the Bank for International Settlements and now President of JPMorgan Chase -
it consisted of a small group of eight "eminent persons," namely: Crockett; former Fed Chair Alan Greenspan; Mohamed el-Erian, CEO of Harvard Management Co.; Tito Mboweni, governor of the South African Reserve Bank; Guillermo Ortiz, governor of the Bank of Mexico; Hamad al-Sayari, governor of the Saudi Monetary Agency; Jean-Claude Trichet, president of the European Central Bank; and Zhou Xiaochuan, governor of the People's Bank of China.
The committee released its report on January 31 of this year.
During the press briefing that followed, Crockett said that the committee favored the "creation of an endowment - were it to be possible - that would provide income that could be relied upon over a period of time without having to ask members."
The "more attractive source" for this "is to use the fund's resources of gold, and so the report does suggest that it would be appropriate and possible to [...] sell a part of the fund's gold holdings, and to devote the resources obtained from that to the creation of an endowment."
The sale could be as much as 400 metric tons (12.9 million ounces), which, valuing the metal at a conservative $500/ounce (the past two years' average), would net the IMF a minimum of $6.6 billion. That amount, invested, would be expected to generate $195 million in annual income. Of course, if current prices hold for the duration of the sales period, those numbers would be substantially higher.
Crockett noted that the 400-ton figure corresponds to IMF gold that was sold and repurchased in an off-market transaction about 6 years ago. It is about 12.5% of the Fund's total holdings.
The Committee, whose recommendations have been referred to the IMF's executive committee for debate, took care to emphasize that the proposed sales should be "ring-fenced [...] to limit their market impacts."
(Longtime Fed watchers chuckled at the wording, noting that such phrases are a dead giveaway of Greenspan participation.)
To this end, Crockett promised the following safeguards:
"In the first instance, the amount should be limited to the 400 tonnes I mentioned without envisaging any additional sales.
"Secondly, the sales should take place within the existing Central Bank Gold Agreement [CBGA], that is to say it would not be additional to sales already programmed by central banks, but would be accommodated by reductions in the amounts of gold that central banks might sell under the [CBGA].
"And thirdly, we have emphasized that the sale should be undertaken in a very careful way in terms of their periodicity amounts and manner of sale such as not to disturb the market."
The CBGA limits signatory central banks (all of the major ones, excluding only the U.S.) to sales of 500 tons/year. In 2006,
however, the banks released only about 350 tons.
Thus, the IMF committee appears to be saying that it proposes taking up whatever slack exists this year, while not allowing its sales to push the amount of new gold coming to market over the pre-set 500-ton limit.
It is important to remember a couple of things here.
First, it's not the IMF's gold. The metal belongs to the depositor nations, the largest of which is the U.S. We the taxpayers own that gold, and thus have a very real interest in what happens to it.
Second, the IMF is prohibited from trading in gold. Its bylaws state that it does not "have the authority to buy gold," nor may it "engage in any other gold transactions - such as loans, leases, swaps, or use of gold as collateral."
What it can do is "accept gold in the discharge of a member's obligations" and "sell gold outright," but the latter requires "an 85% majority of total voting power." Since the U.S. controls about 17% of voting power, it can't by itself make a deal happen. But it has the absolute authority to block one.
The Crockett Committee report is not the first time the notion of IMF gold sales has been floated. It's an idea that has cropped up repeatedly in the past but has always failed, either because of American opposition or because of opposition among the more general membership, which includes many gold-producing nations that have an interest in keeping a floor under prices.
What will be the U.S. position this time around? We'll have to wait and see, but if the past is prologue, there will be stiff opposition. The final decision on whether to veto or not rests with Congress, where Democrats in the past have fought IMF gold sales on the grounds that they would hurt impoverished nations. Sen. Harry Reid voted against them as minority whip, and might be expected to be consistent now that he's majority leader. Or perhaps not, depending on which way present political winds are blowing.
While the IMF's announced motive seems to make fiscal sense - provided one accepts that it has any need to be as big and meddlesome as it is - gold bugs immediately began looking for the story behind the story.
If the Gold Anti-Trust Action Committee (GATA) is correct in their contention that the American government has acted deliberately, in concert with the major central banks, to suppress the price of gold in order to mask the dollar's inherent weakness (an effort in which Mr. Greenspan is alleged to have been a willing participant), then the IMF proposal plays right into such a conspiracy. Its hidden meaning could be that the IMF must help out with gold sales, because the CBGA signatories have become reluctant to part with enough of their reserves to keep a lid on prices and, in fact, may be pleased with the appreciation of their assets. Yearly sales boosted to the full 500 tons, thanks to IMF participation, should contribute to further price suppression. It'd be no great shocker if the IMF were doing the U.S.' bidding.
In addition, it's possible that some depositors, holding dollars and nervous about their decline, are making noise about getting their gold back. Propping up the buck through gold sales could be viewed as an aid to easing their fears.
Then there's the China factor.
Analyst Michael Kosares, writing on USAgold.com, says that,
"There is no doubt in my mind that China would like to see the IMF sell all its 3,217 tonnes of gold, particularly if China might become a primary recipient.
Without any fanfare China would happily write the check for all 3,217 tonnes.
Otherwise, I can't imagine why the Chinese central bank might have been included on this IMF committee, unless it was to demonstrate that the system is at least trying to get them some gold."
Whatever the case, our readers are apt to be most interested in what happens next.
Not an easy call, given that neither the IMF nor the international gold trade are particularly transparent.
Many analysts, though, feel that the proposal will never fly. For example, Julian Phillips of GoldForecaster.com writes: "Should the member nations of the IMF find themselves in disagreement with a decision of the IMF to sell their gold, the possibility of this gold being returned to them is there.
But should this option be used, the damage to the IMF of such a position [a minority objecting to the majority] would produce disunity in the global monetary system,
which could prove extremely disruptive. [I] expect that the mere possibility of such a disruption, of itself, would persuade the majority not to sell any gold, but at best to revalue it."
Even if a sale does come about, will it matter?
Many feel that the IMF's actions are not liable to have much impact on gold, arguing that the distortions of the CBGA, even at maximum 500-ton strength, have already been fully factored into the current price and its trend line.
This is not to say that there couldn't be a short-term downdraught.
Sure there could be, especially as the IMF sales are formally announced.
Some holders of gold, maybe a significant number, can be expected to sell into the news.
But with countries such as China, Russia and the nations of the Middle East itching to add to their reserves,
even a large dump of physical metal onto the market is certain to be absorbed in short order.
Nor will countries be the only buyers.
Beverly Hills investments manager Kenneth Gerbino wrote in 2005 about a similar IMF sales speculation, saying that any additional supply
"would surely be snapped up by the bullion banks and mining companies that are 'short' somewhere between 10,000 and 12,000 tonnes, according to some very savvy analysts."
There's no reason to think that's changed much in the interim.
Gerbino could have been writing about the IMF when he concluded,
"Central bankers will most likely continue, as usual, to scare the price of gold down from time to time by statements of gold sales. But they are all too keenly aware of the growing number of people who realize that the gold, not paper and ink, is the real stable monetary element."
Finally, it is important to keep the relatively miniscule amount of gold sales we are talking about in perspective. In an era where over $1 trillion in derivatives trade globally each day, $6.6 billion in sales is just not that much money when compared to potential investor demand once the U.S. dollar goes into the free fall that Doug Casey, among others, now believe is imminent.
In other words, if IMF sales do happen, and if they depress gold's price, that's a buying opportunity... for bullion and especially for the high-quality junior exploration stocks that pack the most punch in a rising gold market.
my footnote:
"(The committee)it consisted of a small group of eight "eminent persons," namely: Crockett;
former Fed Chair Alan Greenspan;
Mohamed el-Erian, CEO of Harvard Management Co.;
Tito Mboweni, governor of the South African Reserve Bank;
Guillermo Ortiz, governor of the Bank of Mexico;
Hamad al-Sayari, governor of the Saudi Monetary Agency;
Jean-Claude Trichet, president of the European Central Bank;
and Zhou Xiaochuan, governor of the People's Bank of China."
And not a one of them did an honest day's work in their entire lives.
Bah humbug.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 02/19/2007 : 18:04:22
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For those living in Australia this is probably old news, but for those of us in North America, this is interesting news.
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Australia was once awash with gold, says new geological study
Sydney, Feb 1 (ANI): Australia was once awash with gold, a new geological research has suggested.
Dr Bear McPhail from the CRC for Landscape Environments and Mineral Exploration, who conducted the study, said the continent's underground water was awash with high levels of gold millions of years ago.
The findings could help modern day gold seekers in their hunt for the precious metal, he said.
During their study, the researcher team at the Australian National University found that under certain conditions, salty groundwater had the potential to dissolve much higher concentrations of gold than previously thought.
"The chemistry of gold in brine suggests that water has a lot higher capacity to carry gold than we have been able to measure. We have very salty groundwater in parts of Australia, particularly in some of our gold-bearing regions," ABC quoted him as saying.
Dr Frank Reith and his team, also a part of the study, found that bacteria played a key role in forming gold grains and nuggets. They found that certain species of bacteria removed gold from the soil and deposited pure grains of it around them.
Dr McPhail said these two pieces of evidence became important when scientists looked back millions of years, to periods when Australian rocks were subject to a process known as deep weathering.
"During these times, the rocks were being weathered by interaction with the atmosphere and water," Dr McPhail said.
"That weathering may have taken place during times when much of Australia was less arid than it is now. Over millions of years you get climate changes. There were periods when a lot of Australia was tropical," added Dr Reith.
Dr McPhail said these hot, wet conditions would have provided the ideal environment for gold-moving bugs and for water to contain higher gold concentrations.
"During those times, and we're talking about 60 million years ago or 12 million years ago for example, groundwater may have contained more gold," he said.
"The work could prove a boon for mineral explorers," he added.
"If gold was more mobile in the geological past, such as during deep weathering episodes, then this work could help focus exploration in weathered terrains. It could point to new deposits," he said. (ANI) |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 02/19/2007 : 18:09:19
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Mainstream finance gets it wrong on gold
Of course they are going to get it wrong, mainstream finance can't earn commission on selling or buying metal, so they are going to ignore or talk down gold, much to their folly. (Gee, the same financial know-it-alls who think that houses and stocks never go down think gold can never go up.) |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 02/22/2007 : 18:57:11
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China On My Mind... Gold Outlook
Emanuel Balarie
Excerpt
Year of the Gold Pig
2007 is the year of the Gold Pig. Children born in the year of the gold pig, which only comes every 60 years, are supposedly( according to Chinese zodiac signs) going to lead a charmed life and will bring great luck to the couple. Not surprisingly, Chinese hospitals are bracing themselves for a baby boom in 2007.
But what does this mean for gold and gold demand?
Well, the first thing is that jewelers in China are already experiencing an increased demand for jewelry and gold pig jewelry.
This of course, is to be expected.
But beyond this increased demand for gold in 2007,
Chinese consumption of gold is also on the rise as citizens are now making more money.
In 2006, gold consumption increased by 17% even as gold prices finished the year at much higher prices.
In comparison, gold consumption in the U.S. declined by 10%. Not surprisingly, China is now ranked 3rd in terms of gold consumption behind the United States and India. It is only a matter of time until China overtakes the US in terms of consumption.
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Frugi
Administrator
USA
627 Posts |
Posted - 02/22/2007 : 20:20:01
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Sorry to go off topic Pencilvanian, but the year of the pig is so important to the Chinese, women will try to have their children in this year, if you are a pig you will be blessed with lots of money and food, you will be taken care of and are basicly on a pedestal above all others. The pig is THE most desireable sign of all. For example when you apply for a job in China, you are asked for your sign if you are a rat- no chance of getting a job as any type of skilled labor, however if you are a pig the sky is the limit, you can pick your profession.
Again sorry to sway away from topic, do continue.
Real Eyes Realize Real Lies
Buy Less. Work Less. Live More.
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Bullion Prices, Hang Tight
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