It's funny how you end every paragraph with an 'lol'; it's ike a nervous tick LOL
Gold’s biggest slump in three decades has been a boon for MKS (Switzerland) SA’s PAMP refinery near the Italian border in Castel San Pietro, whose bullion sales to China surged to a record as demand rose for coins, bars and jewelry.
As prices plunged 28 percent in 2013, investors dumped a record 869.1 metric tons from gold-backed funds traded mostly in the U.S. and Europe. Much of that metal is ending up in Asia, where companies such as The Brink’s (BCO) Co., UBS AG and Deutsche Bank AG are opening new vaults. China’s expanding wealth has made the country the world’s largest buyer, surpassing India, as imports reached an all-time high.
PAMP Managing Director Mehdi Barkhordar, who credited China’s “insatiable” appetite for a sales boost of as much as 20 percent last year, remains optimistic even as growth in the world’s second-largest economy slows. “The demand in China is off its peak, but still respectable,” he said last week.
To keep up with orders, MKS added shifts at the PAMP refinery, located about 4 miles (6.4 kilometers) from the Italian border, Barkhordar said in November as he showed off a 1-gram gold piece the size of a fingernail. Furnaces that can process more than 450 tons a year were at full capacity from April to June, melting mined metal, scrap jewelry and ingots at 1,000 degrees Celsius (1,832 degrees Fahrenheit) into the higher purities and smaller sizes favored by Asian buyers.
Photographer: Dario Pignatelli/Bloomberg
One-kilogram bars of gold featuring the stamp of Swiss company Produits Artistiques... Read More
Brink’s, the largest provider of precious-metals logistics and storage, is adding room on top of a vault the company opened in 2012 at the Singapore Freeport building next to Changi International Airport, with a sleek, modernist lobby and a twisting, polished-steel sculpture by Ron Arad that stands 5 meters high. Inside, the gold bars are protected by prison-like barriers, two body scanners and 8-ton, firepro
By Peter Cooper
There has been no let up in the buying of gold by China despite the continuous price falls this year. Gold imports via Hong Kong in October hit 130 tonnes, that was the second highest monthly total in history and a massive jump on the same month last year.
China’s imports through Hong Kong will easily top 1,200 tonnes in 2013. But these are just gold import figures that are made public. Gold also enters the Middle Kingdom through other trade routes that are not as scupulous with their data records, notably Shanghai.
2,000 tonnes in 2013
If you add these non-recorded gold imports then analysts say the total quantity of gold imported into China this year will top 2,000 tonnes. Why are they buying it? Nobody else seems to want gold right now. It’s the most unloved commodity outside of China.
Gold bullion is physically moving from the West to East out of London, Zurich and New York and into vaults in China. The gold is coming from sales by the big gold exchange traded funds as well as newly mined global production. China is a major gold producer itself but not a bar leaves the country.
At the current rate of consumption by China there will soon not be enough physical gold left for trading in the traditional markets for precious metals. There will be a massive supply crunch and that will mean only one thing for gold prices, they will go up.
This sort of explanation does not satisfy the day traders who comment on ArabianMoney and ask us to shut up about gold and re-focus on rising global stockmarkets (although they fell too yesterday). They are looking at what has happened in the past rather than considering the future outlook. Forgive us but that is not how investment works.
You have to use all the available information and facts, and a fair amount of imagination to project into the future. Exact timing is always impossible. Getting the broad trends right over the longer term is more than enough to become a highly successful investor.
China, Russia and other nations are exiting their dollar-denominated holdings inMultiple-forms-of-gold-bullion favor of gold. This action should put pressure on the dollar and U.S. treasuries, pushing not only central banks, but mainstream investors towards the safety of precious metals and other tangible assets that cannot be defaulted on. There will be a rush out of dollars and into assets with no counter-party risk, it is just a matter of how soon it happens.
So says Jason Hamlin (goldstockbull) in edited excerpts from his original article* entitled China Hints at Dumping U.S. Debt, Saying De-Americanized World is Needed.
Hamlin goes on to say in further (and perhaps paraphrased in some places) excerpts:
China’s official news agency has published an op-ed commentary [see details at end of article] calling for the ‘de-Americanising’ of the world economy. They specifically mentioned the threat to nations with large amounts of dollar holdings, suggesting that one nation should not have the ability to impact the rest of the world economy so powerfully. In other words, one nation should not be able to print the world reserve currency or issue so much outstanding debt.
China holds roughly $1.3 Trillion in U.S. treasury bonds, so if they decide to follow their words with action, we may see an accelerated selling of U.S. debt and dollars in the East. I don’t foresee an outright dumping of debt as many are anticipating, but I would not be surprised to see China’s treasury holdings cut in half within the next year or two.
The Chinese move from U.S. dollars to gold has been very aggressive, yet under-reported by the mainstream media. At the current pace, Hong Kong will send, just to Mainland China, an amount of gold roughly equivalent to 50% of the rest of the world’s mined supply. Gold imports from Hong Kong to mainland China are set to double the imports from 2012.
Not only are exports from Hong Kong to mainland China skyrocketing, but Hong Kong itself will likely i
Peter Schiff has a warning for gold investors: Don't fear the Fed.
"Gold has already priced in whatever taper is coming," Schiff, CEO and chief global strategist of Euro Pacific Capital, told CNBC. "If anything, it has overpriced it."
Gold is slightly lower Tuesday on the heels of a stronger dollar and a report from Jon Hilsenrath of The Wall Street Journal suggesting that the Fed will continue to reduce—or taper—its bond-purchasing program when it meets next week. The prospect of a Fed exit has terrified gold bugs and led to bullion's worst annual performance in 2013 since the end of the Clinton administration.
But those fears are misplaced, according to Schiff. As he sees it, the Fed has no viable exit strategy, and once the market realizes that, gold could become the hottest trade of the year.
"If the Fed starts tapering, the whole economy will tank," Schiff said on "Futures Now." "Stocks will suffer, the dollar will collapse, and all the Fed's stimulative programs ... since 2008 will have been for nothing. That's why they have to keep printing money. They can't stop. And eventually, that will make gold a very attractive investment."
In other words, the Fed is trapped in a vicious cycle of easy money, unable to fully revive the economy yet hesitant to end the very programs that it hoped would do just that.
Of course, Schiff has made similar claims in the past two years, none of which have worked out particularly well. And he remains noncommittal about the exact timing of gold's possible accent.
But gold remains his top investment choice, Schiff said, adding, "It's a no-brainer."
In the past two weeks we have highlighted the importance of Russia and the world’s central banks to the bullish gold price narrative.
In our recent article “From Russia with Gold”, we detailed that Russia has the 2nd largest unmined gold reserves in the world. Its gold production since 2008 has risen dramatically and remains on the rise. And the Russian central bank has been steadily increasing its official gold reserves since the 1st quarter of 2007, in the lead-up to the Global Financial Crisis (GFC).
In addition, last week our esteemed managing editor and chief analyst penned an excellent essay entitled “Hiding in the Gold Demand Shadows”, which demonstrated the fact that central bankers worldwide (i.e. in emerging and developed countries) fully recognize the importance of gold.
Certain emerging market central banks, in particular the BRIC nations, have been net buyers of gold since the GFC. In addition to the BRIC’s, Turkey is also on track for a record year of gold imports at an estimated 270 tonnes.
However, it’s the speculation about the accumulation of central bank gold reserves by the “C” in BRIC that attracts my focus this week and therefore we are back to talking about China.
It’s All about Planning & Execution Baby!
If there is something China does a lot of, it’s planning. This week, they’re at it again.
Since China’s economic rebirth in 1978, which marked the beginning of their “Reform and Opening Up” policy, they have demonstrated a strong tendency to carry out their stated strategies. Aptly, when they now announce their plans, the world tends to listen. At least it ought to.
The financial press was abuzz this week with the announcement that “China’s ruling party pledged to let markets play a decisive role in allocating resources.” This, the abbreviated summary of the results of China’s most recent 10-year planning session, is different from previous policy statements where China is on record stating, “markets will play a
from the market oracle:
I’m not asking whether the growth rate in this Emerging Market country or that Emerging Market country will meet expectations, or whether the currency in this Emerging Market country will come under more or less pressure. I’m asking if the WHY of Emerging Market growth and currency valuation has changed. The WHY is the dominant Narrative of a market, the set of tectonic plates on which investment terra firma rests. When any WHY is questioned and challenged you get a tremor. But if the WHY changes you get an earthquake.
What are the investments that such an earthquake would challenge? You don’t want to be short the yen if this earthquake hits. You don’t want to be long growth or anything that’s geared to global growth, like energy or commodities. You don’t want to be overweight equities and underweight bonds. You don’t want to be overweight Europe. You can run from Emerging Markets with US equities, but with S&P 500 earnings driven by non-US revenues, you cannot hide. If you think that your dividend-paying large-cap US equities are immune to what happens in China and Brazil and Turkey … well, good luck with that. My point is not to sell everything and run for the hills. My point is that your risk antennae should be quivering, too.
Nobody knows how exactly a change in the narrative will play out, but given this week’s evolution, it seems likely that a flight out of risk assets into gold as a safe haven is very likely. Once the narrative changes, the product of the most powerful central bank, i.e. the US dollar, could be hit by a serious trust crisis. That is the point where the Western world could rediscover the monetary value of gold. That is the point where the correlation between the commodity index and precious metals prices (as evidenced since 2011) will break. Gold is more than a commodity. It is the ultimate protection against the central banking illusion.
There really is a reason why we advocate holding physical gold outside the bank
While I'm not forecasting a $10,000 price for gold any time soon, I do think that gold has a more than reasonable chance of hitting $2,000 in the next 12-18 months. I base this on using the move to new highs that followed the 2006 and 2008 price corrections as "benchmarks." In 2006, the 28% price correction was followed by an 84% move higher. In 2008, the 32% price drop led to a 157% new all-time high of just under $1900.
Price forecasting is as much "art" as it is "math/economics," but if we assume the move from $1183 low is followed by the same 84% rally that followed the 2006 correction, we get a price target of $2,175. Similarly if we apply an arithmetic average (120%) of the previous two correction/new-high cycles, the move that follows this latest correction would lead to a price target of $2,602. Again, I don't want to go on record with an official forecast of $2,602 - although I do think we'll eventually see the price of gold go higher than that. Given both the enormous demand for physical gold, combined with the price behavior of gold historically after big price corrections, I will go on record with a forecast of at least $2,000 within 18 months.
from talking numbers with video:
Though emerging market turmoil is rattling US stocks, not everyone is having a bad time.
Gold investors are rejoicing at the yellow metal's 3% gain so far in 2014. That comes after the worst year for gold since Bill Clinton was in the White House.
And, one of gold's staunchest advocates, former congressman and presidential candidate Ron Paul, say gold remains the place to be.
Emerging markets have been shaky in part because of worries that the Federal Reserve Bank's monetary stimulus tapering will make it harder to attract capital to smaller, riskier economies.
That monetary stimulus, which was ramped up to $85 billion per month throughout 2013, was expected by some gold investors to be the inflationary factor that would send gold skyrocketing. Instead, bullion was down 28% last year.
But, Paul sees 2013's gold price decline as merely a blip in the screen in the overall scheme of things.
"I don't see gold so much in short-term because I see it in over a 100-year period," says Paul to Talking Numbers. "Long-term, it will always go up so long as we have a Fed printing money. But, on the short-term, the traders have a lot to say about this. A correction like we just had last year – one year out of 13 – that's not a big correction. That doesn't destroy a so-called bull market."
Paul believes gold is at the bottom of its cycle. With continued stimulus, growing national debts, and market fear, Paul says investors will flock to gold.
"I think they're going to move to gold," says Paul. "Gold is going to be the safe haven which it's been for 6,000 years."
Besides aesthetic reasons people like gold, Paul says it also serves a practical policy purpose.
"The most important thing about gold," says Paul "is it restrains the temptation of those who think they know best in what interest rates should be and what the money supply should be."
some wrote that topic title on pulse, which I think makes a lot of sense.
It's up almost 4% for the year so far. Seems to have bottomed and looking move much higher.
yes, that's why it's a good buy now. YOu think it will go down forever?
It looks like Gold bottomed in December.
from money morning:
Gold fell by 28% in 2013. That's a huge reversal of a decade-plus trend.
Between 2001 and 2012, gold managed positive gains every single year, a track record unmatched by any major asset.
The precious metal went from a low of $255 in April 2001 to a high of $1,900 in September 2011, for a peak return of 745%.
Since then, gold has given back 35% from its $1,900 high, leading many to call the end of the gold bull market.
But is it really finished?
By looking at history and numerous indicators, I've found a different story.
One that will jumpstart your 2014 profits...
Simple Economics Guarantees a Gold Rally
Fundamental drivers for gold are so numerous I hardly know where to start.
Unprecedented quantitative easing (money printing) and ultra-low interest rate policies imposed by central banks - especially in the United States, Japan, Europe and China - are in the news every day.
Here are several others that aren't grabbing headlines yet, but shouldn't be ignored.
Shuttering Operations: It's no secret that falling gold prices have made numerous mines unprofitable. That's pressured management at those mining companies to rationalize their operations. Producing gold at a loss doesn't make for happy shareholders.
So mines are being put on care and maintenance, seriously cutting into gold production worldwide. Evy Hambro, who manages BlackRock Inc.'s $8 billion World Mining Fund, said gold supply could fall "quite rapidly" as producers restrict output at higher-cost mines.
Fewer Discoveries: Lower gold prices have meant, of course, lower profits. So, miners are cutting back on expenses that aren't immediately accretive, affecting the development of mine expansions, new projects, and exploration. That's inevitably going to mean fewer ounces available to mine in the near and medium terms than would have been the case without this gold price rout. There were half as many drills looking for precious metals in the first 9 months of 2013 versus 2012.
High-Grading: In response to lower prices, gold miners have resorted to mining higher-grade ores while leaving behind low-grade ores. That allows them to be more profitable on ounces produced this way, but it means much higher prices will be needed to go back to the lower-grade ores. In some cases, these may never even be mined out at all.
Physical Asian Buying: Asia loves gold, and that trend continues. In the first nine months of 2013, India and China together had bought 1,500 tonnes (1,653 short tons) of gold, easily dwarfing Western purchases. When Indian, Chinese, and central bank buying are combined, they account for nearly the entire annual world gold production.
Overall, gold fundamentals have not only remained intact, they've continued to improve. So it's easy to project them to push higher gold prices in the future. They've got the laws of economics behind them...
Gold Hits the Same Bottom - Twice
An important part of technical analysis involves analyzing price action. And gold's had plenty of that over the past year.
Most significant was the massive price drop in mid-April when a black swan crash-landed on the gold market.
Over just two trading days, gold futures prices shed 13%, falling from $1,575 to $1,375. That $200 cliff dive was the largest two-day drop in 33 years.
By late June the price had fallen further still, to $1,180 per ounce. So far, that's been the low.
Recent news of the Fed's QE tapering again weighed on gold in late December, causing it to momentar