Maklumat yang terkandung di sini telah diperolehi daripada sumber-sumber yang dipercayai boleh dipercayai, tetapi tidak ada jaminan kepada kesempurnaan atau ketepatan. Setiap pendapat yang dinyatakan di sini adalah kenyataan pertimbangan kami pada tarikh ini dan tertakluk kepada perubahan tanpa notis.
NEW YORK (Rosland Capital) -
In case you hadn't noticed, gold prices have been surging to new all-time highs. At one point today (Thursday, August 18th) the yellow metal touched a record $1,830 an ounce - (and has risen still further overnight to pass the $1850 mark Friday morning in Europe.)
Whether gold continues to skyrocket, settles into a new trading range around recent levels, or plummets as high prices discourage buyers and encourage profit-takers is anyone's guess.
At some point, however, we will see a correction, perhaps a sizeable one. After all, even strong bull markets never move up in straight lines. I would not be surprised to see gold stumble - falling back $100, $200, or even $300 - before prices begin working their way higher once again.
My advice to gold investors is to use sell-offs, when they occur, as opportunities for scale-down buying. And, those who are underweighted or own no metal should gradually acquire physical metal with their focus on long-term portfolio protection rather than short-term profits.
Adding to my short-term caution has been some price-related relaxation of physical demand and the appearance of increased quantities of gold scrap returning to the market, especially from India and other price-sensitive national markets.
I'm confident gold's long-term uptrend will continue in the months and years ahead, ultimately reaching a multiple of today's record level.
SEASONAL DEMAND
In any event, gold will soon begin to benefit from increased seasonal demand, demand that should support the yellow metal's price right through New Year's Day. There are three distinct sources of seasonal demand: (1) Western jewelers step up fabrication demand ahead of Christmas gift-giving late in the year; (2) Indian dealers begin stocking up ahead of the late summer and autumn festivals and wedding season; and (3) in December and January, the approaching Chinese lunar new year triggers another sharp rise in gold demand.
For sure, irrespective of the season, Asian demand - principally from China and India - for physical metal will continue to underpin these markets and limit downside risks.
So too will bargain hunting by a number of central banks eager to raise their official gold holdings without disrupting the world gold market by increasing upward price volatility.
BULLISH ECONOMIC FORCES TO CONTINUE
There is no reason to believe that the forces and factors pushing gold higher - in the past weeks, months, and years - are simply going to disappear anytime soon. I've been talking about many of these for years . . . and, I expect I'll still be talking about these same pro-gold forces for years to come.
The recent rush of gold buying is, in large part, a rational response to rising uncertainty, anxiety, and fear that the U.S. and European economies are stumbling badly . . . and world financial markets are increasingly vulnerable to an epileptic seizure, or worse.
In recent days, signs of renewed recession on both sides of the Atlantic and Europe's worsening sovereign-debt crisis are raising expectations that the Federal Reserve and European Central Bank (ECB) will both be compelled to pursue evermore stimulative monetary policies beginning with a new round of quantitative easing in the United States and stepped-up ECB purchases of sovereign debt and/or interest-rate cuts in Europe.
These policies - and the implications for future inflation and monetary debasement - are like steroids for the gold market, causing investors and central-bank reserve managers to seek the protection of gold.
In any event, whatever happens in the U.S. and European economies, it is hard to imagine a realistic scenario that won't push gold prices significantly higher.
CENTRAL BANK ACQUISITION: MORE IMPORTANT THAN YOU THINK
Importantly, contributing to gold's recent swift rise has been the growing interest and stepped-up acquisition of gold by the official sector.
This was underscored by the Central Bank of Venezuela's recent announcement that it was repatriating much of its official gold reserves from foreign custody. Statistics from the Bank for International Settlements (the BIS) suggest that a number of other countries have, in the past year, repatriated gold rather than store it in the custody of the Bank of England, the New York Federal Reserve Bank, or in the vaults of other central banks.
While these are not purchases of gold affecting the world market supply/demand balance, the trend toward repatriation illustrates the special role gold plays as an asset of last resort among central bank reserve managers.
Increasingly, central banks are buying gold: South Korea announced a couple of weeks ago that it had purchased 25 tons over the past two months, almost tripling its central bank gold holdings. Thailand's central bank, too, has been an important buyer, recently adding nearly 18 tons to its official gold stocks. Even the Banco de Mexico bought 100 tons earlier this year, joining China, Russia, India, and Saudi Arabia - all of which bought large quantities in recent years. Russia continues to buy gold regularly from its domestic production - and, we think, China does likewise though it chooses not to report its purchases.
News of central bank gold repatriation - and, even more so, outright purchases - is likely to encourage more central banks underweighted in gold to begin or continue buying. Even more so than many private investors, central bankers are apt to be purchasers for the long haul, holding gold as a diversifier and insurance policy against what they perceive to be the growing risk of U.S. dollar depreciation and debasement.
I expect the rising trend in central bank interest and accumulation of gold will be an important force in the market for many years to come. In the meantime, bargain hunting by a number of central banks eager to raise their official gold holdings without disrupting the world gold market will help limit downside risk.
Jeffrey Nichols is Senior Economic Advisor to Rosland Capital, and Managing Director of American Precious Metals Advisors.
EMAS-KLASIK
Sunday 21 August 2011
Thursday 18 August 2011
Gold hits record high of above US$1,816 an ounce
Maklumat yang terkandung di sini telah diperolehi daripada sumber-sumber yang dipercayai boleh dipercayai, tetapi tidak ada jaminan kepada kesempurnaan atau ketepatan. Setiap pendapat yang dinyatakan di sini adalah kenyataan pertimbangan kami pada tarikh ini dan tertakluk kepada perubahan tanpa notis.
LONDON : The price of gold hit a record high of above US$1,816 an ounce Thursday, as demand for the safe haven investment rose on resurgent worries about a possible new recession for the global economy, analysts said.
Gold struck US$1,816.25 on the London Bullion Market shortly before 1200 GMT, beating the previous record of US$1,814.95 that was forged on August 11.
It later pulled back slightly to stand at US$1,809.65 an ounce.
The new high came as Europe's main stock markets were plunging ahead of US inflation data, with Frankfurt's DAX 30 index down more than 4.0 percent.
"There is another air of panic out there in the market today, what with the DAX... US crude oil falling two dollars and European banks getting crushed again," said Ian O'Sullivan, an analyst at Spread Co. trading group.
"The beneficiary once again of this nervousness has been gold, which has shot up another 30 dollars today."
Gold is seen as a safe bet in times of economic uncertainty.
- AFP/ir
LONDON : The price of gold hit a record high of above US$1,816 an ounce Thursday, as demand for the safe haven investment rose on resurgent worries about a possible new recession for the global economy, analysts said.
Gold struck US$1,816.25 on the London Bullion Market shortly before 1200 GMT, beating the previous record of US$1,814.95 that was forged on August 11.
It later pulled back slightly to stand at US$1,809.65 an ounce.
The new high came as Europe's main stock markets were plunging ahead of US inflation data, with Frankfurt's DAX 30 index down more than 4.0 percent.
"There is another air of panic out there in the market today, what with the DAX... US crude oil falling two dollars and European banks getting crushed again," said Ian O'Sullivan, an analyst at Spread Co. trading group.
"The beneficiary once again of this nervousness has been gold, which has shot up another 30 dollars today."
Gold is seen as a safe bet in times of economic uncertainty.
- AFP/ir
Wednesday 17 August 2011
The huge leap in the gold price - what did it actually say?
Maklumat yang terkandung di sini telah diperolehi daripada sumber-sumber yang dipercayai boleh dipercayai, tetapi tidak ada jaminan kepada kesempurnaan atau ketepatan. Setiap pendapat yang dinyatakan di sini adalah kenyataan pertimbangan kami pada tarikh ini dan tertakluk kepada perubahan tanpa notis.
The recent big surge in the gold price presages considerably more economic pain before governments take the necessary steps to rebalance the global economy.
Author: Julian Phillips
BENONI -
In the last weeks we have seen the gold price jump from the price we alerted our subscribers of $1,555, to reach just over $1,800 before reacting downwards today. Contrary to the view of many analysts, we do not see this as a frothy overrun from which it will pull back. On the contrary, this rise in the gold price has said so much more than simply, trading peak.
Many have blamed the unfortunate S & P ratings agency for the market dramas in the last two weeks, but they were simply the boy who said ‘the emperor had no clothes on.' For months now, we have known and commented on the fact that the debt crises on both sides of the Atlantic would lead to trouble. One hopes that the news is not as bad as it seems, but we all knew it was. The build-up of parallel crises added weight to the drama so when the Dow suddenly sank it was simply a postponed reaction. The fact that a ‘head-and-shoulders' had completed its formation made the market ripe for fall.
Everybody reacted all over the world as this postponed reality was publicly accepted. The oil price fell to below $80, the dollar and the euro fell like a stone, the Swiss Franc and the Yen soared to economy-destructive levels and eventually the Fed confirmed that the U.S. economy should see no growth for another 2 years. The Chinese government called for a new global reserve currency to replace the dollar.
All in all, the global economic scene experienced a gear-shift,
down to a darker investment climate...
The$1,555 gold price had already signaled that it was going to take off in June, but the S & P trigger sent it soaring effortlessly to $1,800. Only now are these new realities being properly absorbed, although slowly...
WHY?
We see the S & P downgrade as a judgment on the Congressional inability to properly assess the dire nature of the U.S. credit situation because of their fixation on party politics. It is the first time that the U.S. Congress has had to see the rest of the world react to the declining U.S. global economic dominance. It had to happen for the U.S. Congress to understand that the U.S. is responsible for its behavior and will face consequences if it does not adjust. It's a change that has not happened for 40 years.
We do not see a change in the political behavior of Congress until more consequences force that change. There may be considerable economic pain before this happens, and the future brightens for the U.S. During this time the U.S. has to see that it is no longer the world's economic axis, allowed to extract advantage from the rest of the world through its ‘exorbitant privilege' of printing money to pull itself out of economic decline. As we forecast at the beginning of this year, 2011 would be a year of consequences!
THE FUTURE
As we move towards QE3, more dollar printing and the consequential inflation, we fully expect the reaction of the dollar to weaken much faster. QE3 will confirm that they have chosen inflation as a way out of a double-dip recession or deflation. The interdependence of currencies will prevent exchange rates from highlighting any currency's weakness. We have seen this last week in the actions of Japan and Switzerland to weaken their safe-haven currencies. History will record that the announcement by S & P was simply a trigger for a new era of currency instability and the loss of currency values.
Only the gold price is now truly capable of measuring the weakness of currencies. The jump in the gold price over the past decade has been screaming this to all, but few outside of gold were listening. The leap since June of $250 reflected the acceleration in the speed of declining values.
It is natural for us to assume that the global monetary authorities will agree to a reformation of the monetary system that effectively addresses the mess it is in right now. Certainly we expect the mess to worsen considerably before this is accepted.
After that, who will be responsible for putting it right?
What obstacles will they face?
v Politicians will have to please those who put them in power and cannot act independently of this power base, no matter how necessary a departure may be. It would be political suicide to do anything else -a consequence of democracy.
v Politicians or Monetary Officials likewise will have to ensure they act in the interests of their nation even if it goes against the greater good of the international community.
v The international pecking order will weigh in to give priority to measures put forward by the most powerful. The battle will likely impact the voting rights in the I.M.F. where the 16.83% of the U.S. -the I.M.F. needs an 85% vote to pass any measure-will come under fire and China will be given a share of the voting commensurate with its growing economic power.
v All of the above has to be decided before China's request for a new global reserve currency can even be contemplated.
v A new global reserve currency would require either the diminishing of the dollar's role in the global economy or its removal as its sole reserve currency.
The obstacles will prevent the much-needed structural monetary reform. Are the current powers-that-be impartial enough or be franchised to formulate a globally reformed effective monetary system? Not yet, if we look back at the efforts of the U.S. Congress to cut their budget deficit.
What is next? History shows that willing change, when not forthcoming gives way to unwilling change! Unwilling change climbs out of wars or rupturing, destructive, crises that remove the above barriers and which license the powers-that-be to undertake needed, sweeping reforms.
Julian Phillips is a long time specialist analyst of the gold and silver markets and is the principal contributor to the Gold Forecaster -
The recent big surge in the gold price presages considerably more economic pain before governments take the necessary steps to rebalance the global economy.
Author: Julian Phillips
BENONI -
In the last weeks we have seen the gold price jump from the price we alerted our subscribers of $1,555, to reach just over $1,800 before reacting downwards today. Contrary to the view of many analysts, we do not see this as a frothy overrun from which it will pull back. On the contrary, this rise in the gold price has said so much more than simply, trading peak.
Many have blamed the unfortunate S & P ratings agency for the market dramas in the last two weeks, but they were simply the boy who said ‘the emperor had no clothes on.' For months now, we have known and commented on the fact that the debt crises on both sides of the Atlantic would lead to trouble. One hopes that the news is not as bad as it seems, but we all knew it was. The build-up of parallel crises added weight to the drama so when the Dow suddenly sank it was simply a postponed reaction. The fact that a ‘head-and-shoulders' had completed its formation made the market ripe for fall.
Everybody reacted all over the world as this postponed reality was publicly accepted. The oil price fell to below $80, the dollar and the euro fell like a stone, the Swiss Franc and the Yen soared to economy-destructive levels and eventually the Fed confirmed that the U.S. economy should see no growth for another 2 years. The Chinese government called for a new global reserve currency to replace the dollar.
All in all, the global economic scene experienced a gear-shift,
down to a darker investment climate...
The$1,555 gold price had already signaled that it was going to take off in June, but the S & P trigger sent it soaring effortlessly to $1,800. Only now are these new realities being properly absorbed, although slowly...
WHY?
We see the S & P downgrade as a judgment on the Congressional inability to properly assess the dire nature of the U.S. credit situation because of their fixation on party politics. It is the first time that the U.S. Congress has had to see the rest of the world react to the declining U.S. global economic dominance. It had to happen for the U.S. Congress to understand that the U.S. is responsible for its behavior and will face consequences if it does not adjust. It's a change that has not happened for 40 years.
We do not see a change in the political behavior of Congress until more consequences force that change. There may be considerable economic pain before this happens, and the future brightens for the U.S. During this time the U.S. has to see that it is no longer the world's economic axis, allowed to extract advantage from the rest of the world through its ‘exorbitant privilege' of printing money to pull itself out of economic decline. As we forecast at the beginning of this year, 2011 would be a year of consequences!
THE FUTURE
As we move towards QE3, more dollar printing and the consequential inflation, we fully expect the reaction of the dollar to weaken much faster. QE3 will confirm that they have chosen inflation as a way out of a double-dip recession or deflation. The interdependence of currencies will prevent exchange rates from highlighting any currency's weakness. We have seen this last week in the actions of Japan and Switzerland to weaken their safe-haven currencies. History will record that the announcement by S & P was simply a trigger for a new era of currency instability and the loss of currency values.
Only the gold price is now truly capable of measuring the weakness of currencies. The jump in the gold price over the past decade has been screaming this to all, but few outside of gold were listening. The leap since June of $250 reflected the acceleration in the speed of declining values.
It is natural for us to assume that the global monetary authorities will agree to a reformation of the monetary system that effectively addresses the mess it is in right now. Certainly we expect the mess to worsen considerably before this is accepted.
After that, who will be responsible for putting it right?
What obstacles will they face?
v Politicians will have to please those who put them in power and cannot act independently of this power base, no matter how necessary a departure may be. It would be political suicide to do anything else -a consequence of democracy.
v Politicians or Monetary Officials likewise will have to ensure they act in the interests of their nation even if it goes against the greater good of the international community.
v The international pecking order will weigh in to give priority to measures put forward by the most powerful. The battle will likely impact the voting rights in the I.M.F. where the 16.83% of the U.S. -the I.M.F. needs an 85% vote to pass any measure-will come under fire and China will be given a share of the voting commensurate with its growing economic power.
v All of the above has to be decided before China's request for a new global reserve currency can even be contemplated.
v A new global reserve currency would require either the diminishing of the dollar's role in the global economy or its removal as its sole reserve currency.
The obstacles will prevent the much-needed structural monetary reform. Are the current powers-that-be impartial enough or be franchised to formulate a globally reformed effective monetary system? Not yet, if we look back at the efforts of the U.S. Congress to cut their budget deficit.
What is next? History shows that willing change, when not forthcoming gives way to unwilling change! Unwilling change climbs out of wars or rupturing, destructive, crises that remove the above barriers and which license the powers-that-be to undertake needed, sweeping reforms.
Julian Phillips is a long time specialist analyst of the gold and silver markets and is the principal contributor to the Gold Forecaster -
Gold correction to continue near term but $2,000/oz "a real possibility in 2012"
Maklumat yang terkandung di sini telah diperolehi daripada sumber-sumber yang dipercayai boleh dipercayai, tetapi tidak ada jaminan kepada kesempurnaan atau ketepatan. Setiap pendapat yang dinyatakan di sini adalah kenyataan pertimbangan kami pada tarikh ini dan tertakluk kepada perubahan tanpa notis.
-TDS's Bart Melek
TD Securities expects gold prices "to come within $2,000/oz territory in the coming months", but warns of lower industrial minerals prices.
RENO, NV -
TD Securities Bark Melek warns investors that "gold is set to continue its short-term correction after its stellar performance."
In recently published Commodities Trade Strategy research, Melek, TD's head of commodity strategy, writes, "Despite the very gold-favorable macroeconomic fundamentals and the bullish sentiment toward the yellow metal (especially retail investors), TDS expects the current correction to continue in the near-term."
"Reminiscent of silver after its parabolic rise, gold is set to continue its short term correction after its stellar performance-higher spec margins, a sharp jump in implied volatilities and more risk appetite the key catalysts," he predicted.
Melek observed that gold is down some $80/oz from recent highs and an additional $40-$60/oz downside move "is very possible given the recent trading history." Nonetheless, he remains "bullish on the yellow metal longer term, with prices expected to come within $2,000/oz territory in the coming months."
In his analysis, Melek noted the Chicago Mercantile Exchange has lifted margins on gold contracts "by a hefty 22% overnight."
"Higher margins mean that some investors will need higher cash positions, causing them to sell gold in order to comply with the new standard," he suggested. "At the very least, this is cooling off some of the gold euphoria in the market and could prompt some traders to take profits, just because they can."
"Memories of developments in the silver market earlier this year should also motivate profit taking," he added.
Meanwhile, Melek advised higher volumes could also prompt addition gold corrections. "Better equity markets and more risk appetite are also helping to move gold lower."
In his analysis, Melek suggested there are strong parallels to the silver market development of last April and today's gold situation. "The silver rally was almost entirely speculatively driven, and we saw a near doubling in silver initial margins, while silver cols moved much more. At the same time, the silver rally was much more pronounced in relative terms."
"The gold market is much more liquid and more widely held than silver," he noted. "It also has very favorable supply/demand fundamentals, which was not the case for silver at the time."
"As such, we do not expect an overly brutal correction in gold."
Meanwhile, with a quite poor economic outlook and no room to maneuver on the fiscal side, Melek advised "gold investors are starting to speculate that western world central banks may need to resort to ‘heroic' monetary actions to get their economies moving, including some form of monetization of government debt."
In light of the Fed's explicit statements that it will maintain low rates through mid-2012, coupled with the likelihood of further monetary stimulus now higher than previous thought, TDS is revising its gold forecast higher.
"This adjustment reflects our view that gold will act both as a safe haven asset and a story of value to offset the inflationary aspects of further easing," Melek explained. "Rising mining cost promoted us to lift the long-term gold price projection."
However, Melek cautioned that more industrial metals "should react in the opposite manner with the soft patch getting stickier as economic data flows continue to disappoint and push the global economy to the brink of a possible recession."
"Demand growth for industry metals will be slightly less robust under this scenario, pressuring prices slightly lower across the sector, leading us to revise our forecasts lower to reflect these developments," he advised.
-TDS's Bart Melek
TD Securities expects gold prices "to come within $2,000/oz territory in the coming months", but warns of lower industrial minerals prices.
RENO, NV -
TD Securities Bark Melek warns investors that "gold is set to continue its short-term correction after its stellar performance."
In recently published Commodities Trade Strategy research, Melek, TD's head of commodity strategy, writes, "Despite the very gold-favorable macroeconomic fundamentals and the bullish sentiment toward the yellow metal (especially retail investors), TDS expects the current correction to continue in the near-term."
"Reminiscent of silver after its parabolic rise, gold is set to continue its short term correction after its stellar performance-higher spec margins, a sharp jump in implied volatilities and more risk appetite the key catalysts," he predicted.
Melek observed that gold is down some $80/oz from recent highs and an additional $40-$60/oz downside move "is very possible given the recent trading history." Nonetheless, he remains "bullish on the yellow metal longer term, with prices expected to come within $2,000/oz territory in the coming months."
In his analysis, Melek noted the Chicago Mercantile Exchange has lifted margins on gold contracts "by a hefty 22% overnight."
"Higher margins mean that some investors will need higher cash positions, causing them to sell gold in order to comply with the new standard," he suggested. "At the very least, this is cooling off some of the gold euphoria in the market and could prompt some traders to take profits, just because they can."
"Memories of developments in the silver market earlier this year should also motivate profit taking," he added.
Meanwhile, Melek advised higher volumes could also prompt addition gold corrections. "Better equity markets and more risk appetite are also helping to move gold lower."
In his analysis, Melek suggested there are strong parallels to the silver market development of last April and today's gold situation. "The silver rally was almost entirely speculatively driven, and we saw a near doubling in silver initial margins, while silver cols moved much more. At the same time, the silver rally was much more pronounced in relative terms."
"The gold market is much more liquid and more widely held than silver," he noted. "It also has very favorable supply/demand fundamentals, which was not the case for silver at the time."
"As such, we do not expect an overly brutal correction in gold."
Meanwhile, with a quite poor economic outlook and no room to maneuver on the fiscal side, Melek advised "gold investors are starting to speculate that western world central banks may need to resort to ‘heroic' monetary actions to get their economies moving, including some form of monetization of government debt."
In light of the Fed's explicit statements that it will maintain low rates through mid-2012, coupled with the likelihood of further monetary stimulus now higher than previous thought, TDS is revising its gold forecast higher.
"This adjustment reflects our view that gold will act both as a safe haven asset and a story of value to offset the inflationary aspects of further easing," Melek explained. "Rising mining cost promoted us to lift the long-term gold price projection."
However, Melek cautioned that more industrial metals "should react in the opposite manner with the soft patch getting stickier as economic data flows continue to disappoint and push the global economy to the brink of a possible recession."
"Demand growth for industry metals will be slightly less robust under this scenario, pressuring prices slightly lower across the sector, leading us to revise our forecasts lower to reflect these developments," he advised.
Friday 12 August 2011
Yesterday a small technical rebound is really not a good sign in share market. Base on world share market, money is flowing out from share market to gold! Gold price just hits USD1,800 per oz and just in less than 2 week Gold price up USD100 5.88% it was better that in FD.
Maklumat yang terkandung di sini telah diperolehi daripada sumber-sumber yang dipercayai boleh dipercayai, tetapi tidak ada jaminan kepada kesempurnaan atau ketepatan. Setiap pendapat yang dinyatakan di sini adalah kenyataan pertimbangan kami pada tarikh ini dan tertakluk kepada perubahan tanpa notis.
Yesterday a small technical rebound is really not a good sign in share market. Base on world share market, money is flowing out from share market to gold! Gold price just hits USD1,800 per oz and just in less than 2 week Gold price up USD100 5.88% it was better that in FD.
Base on the FBM KLCI index yesterday, it show that investor is not going to invest more in share even the price had deep more than 10% and I think this event will continues for a week till US government do something about it.
Yesterday a small technical rebound is really not a good sign in share market. Base on world share market, money is flowing out from share market to gold! Gold price just hits USD1,800 per oz and just in less than 2 week Gold price up USD100 5.88% it was better that in FD.
Base on the FBM KLCI index yesterday, it show that investor is not going to invest more in share even the price had deep more than 10% and I think this event will continues for a week till US government do something about it.
Thursday 11 August 2011
GOLD IS SHINING (KILAUAN EMAS)
Maklumat yang terkandung di sini telah diperolehi daripada sumber-sumber yang dipercayai boleh dipercayai, tetapi tidak ada jaminan kepada kesempurnaan atau ketepatan. Setiap pendapat yang dinyatakan di sini adalah kenyataan pertimbangan kami pada tarikh ini dan tertakluk kepada perubahan tanpa notis.
As for the gold market itself, , "Everything right now looks very supportive of gold". Not only is there a significant risk aversion move at play but, in places like India and China, there is a strong move toward gold as an inflation hedge.
The risk aversion market is now global - everybody is buying gold and with restrictions in other currencies, gold demand is very well supported. And, as we've seen with emerging markets, the allotment of gold in their reserve asset base is very low with respect to western economies so just as a pure diversification we can see a lot of gold moving from west to east, but right now it doesn't appear that the central banks want to sell gold - if anything, that they're net buyers
As for the gold market itself, , "Everything right now looks very supportive of gold". Not only is there a significant risk aversion move at play but, in places like India and China, there is a strong move toward gold as an inflation hedge.
The risk aversion market is now global - everybody is buying gold and with restrictions in other currencies, gold demand is very well supported. And, as we've seen with emerging markets, the allotment of gold in their reserve asset base is very low with respect to western economies so just as a pure diversification we can see a lot of gold moving from west to east, but right now it doesn't appear that the central banks want to sell gold - if anything, that they're net buyers
Tuesday 9 August 2011
Top NEWS: StockMarket Collapsed Gold Soars
Maklumat yang terkandung di sini telah diperolehi daripada sumber-sumber yang dipercayai boleh dipercayai, tetapi tidak ada jaminan kepada kesempurnaan atau ketepatan. Setiap pendapat yang dinyatakan di sini adalah kenyataan pertimbangan kami pada tarikh ini dan tertakluk kepada perubahan tanpa notis.
Markets collapse, silver static, platinum falls below gold.
Gold has soared ahead of the platinum price for the first time in over a decade, while silver has stuttered. Where do we go from here?
Author: Lawrence Williams
Posted: Tuesday , 09 Aug 2011
LONDON -
Realisation has dawned, not before time, on the investment community and the general population, that the global financial problems are, indeed, serious and gold appears to have been the major beneficiary to date. Interestingly, other precious metals have not moved up alongside gold, as has tended to be the norm - indeed they have either fallen back or stuttered. But if one looks at demand for these other precious metals this is not really surprising. Indeed, it is surprising that they have not fallen back as much as might have been expected under the circumstances, particularly in the case of silver.
The reason for this, of course, relates to the degree of industrial usage in the demand for the precious metals. Gold's industrial usage is relatively small in relation to its industrial demand. Silver demand is perhaps relatively evenly divided between investment and industrial use, while platinum and palladium have a far stronger industrial element in their demand. And, given that much of the economic uncertainty revolves around fears that U.S. and Western economies may not be recovering as expected, while there are some doubts expressed over Chinese growth being maintained at recent levels, the moves by the precious metals begin to make sense.
The doomsayers have been predicting another market collapse for some months now and found it difficult to understand what seemed to be climbing stock prices in the face of what they saw as an obvious financial meltdown brewing. The gold bulls have been predicting the rise in price - but the speed of the increase in the past couple of weeks will have taken many of even the ardent bulls by surprise.
But then the silver bulls have been looking for an even sharper increase in their favourite metal, but it hasn't happened - yet!
One has to learn from 2008 though when worries then about global recovery sent stocks crashing - and industrial commodities - and related mining stocks - were amongst the worst hit of all. So far this time, one could say that silver, in particular, which suffered really badly in 2008 falling from over $20 at peak to around $8 at its nadir, has actually performed pretty well by comparison. This could bode particularly well for its future once the market falls are over, assuming it can maintain its position. To a great extent the silver price consolidation is almost certainly because of continuing strong investment demand from the Near and Far East, which was not quite so apparent three years ago
But the portents for the markets do not necessarily look good at the moment. If we draw parallels with2008/9, markets fell around 50% from peak to bottom and if this pattern repeats there's an awfully long way down to go yet and virtually all kinds of stocks and commodity prices could be hit again too - even relating to those which are considered safe havens like gold. Putting such parallels in place, the S&P could fall to around 675 and the FTSE to 3000. Very worrying statistics for market investors!
But before gold stocks investors start patting themselves on the back for selecting the ultimate safe haven, it is worth noting that gold itself fell around 30% and the Amex Gold Bugs Index - the HUI - fell more than 60%, although both recovered far faster than other market sectors. Gold for example regained its losses in about 4 months, while the S&P at its recent high point still remained well below its 2007/2008 peaks.
But maybe things will be different for precious metals this time. The big problem though is that if markets continue falling, potentially strong sectors, like gold and gold stocks, need to be sold off to cover losses elsewhere - hence everything can fall back, and probably will. Juniors become particularly vulnerable as sources of finance tend to dry up.
What the precious metals investor may have learnt from 2008 though is that the market collapse then created some enormous buying opportunities. In the three years since 2008 fortunes were made in carefully picked gold stocks and the same could happen again. The problem here is to get back in at, or near, the bottom and that may not be for a couple of months yet and stocks could fall a long way in the meantime.
On the other hand, markets are fickle. They are falling at the moment because investor confidence has diminished dramatically - not necessarily because companies are doing any worse. Indeed gold producers at the moment should be making record profits given current prices and they find it hard to understand why their stocks are falling too. The gold majors should be the safest options but these have all also come back between 5 and 10% in the past few weeks - even Newmont which has promised to tie dividends to the gold price and thus promises increased yields for investors. The falls here are not nearly as bad though, as say major banks. Bank of America for example has fallen more than 30% in the past few days.
A change in sentiment though will see markets recover, but now no-one believes politicians' attempts to talk up the economy. The U.S. in particular, shot itself in the foot over the debt ceiling wrangles and this, taken in conjunction with the Eurozone debt problems and the S&P downgrade, was probably the straw that broke the camel's back. It may take some time yet for investor confidence to recover.
But what about the other main ‘precious' metals - silver, platinum and palladium. In 2008 silver plunged around 60%, platinum around 65% and palladium around 70%. Horrendous figures for investors at the time. This time around - again assuming a parallel crash to that of 2008, there is a chance that similar plunges will not occur - at least perhaps not to the same magnitude. Gold is a great deal higher now and there has always been an element of the other precious metals moving in conjunction. As noted above, silver has become much more of an investment metal in its own right - particularly as gold has become too expensive for the smaller investor to purchase and they are finding an outlet in silver which perhaps was not there three years ago. The fact that platinum is currently selling at around below the gold price - a situation that has not tended to persist for long in the past - may lend some support here too and palladium may well move in concert. The suggestion here is that either gold is due a fall from its current heights, or platinum may pick up a little.
The situation is certainly interesting and will tax the thoughts of those looking to protect what they have. To this observer the gold price at current levels may be a little vulnerable to profit taking, while there may be a flight to cash as investment professionals seek to try and buy time until they have a better handle on which way markets will move. Uncertain times!
Markets collapse, silver static, platinum falls below gold.
Gold has soared ahead of the platinum price for the first time in over a decade, while silver has stuttered. Where do we go from here?
Author: Lawrence Williams
Posted: Tuesday , 09 Aug 2011
LONDON -
Realisation has dawned, not before time, on the investment community and the general population, that the global financial problems are, indeed, serious and gold appears to have been the major beneficiary to date. Interestingly, other precious metals have not moved up alongside gold, as has tended to be the norm - indeed they have either fallen back or stuttered. But if one looks at demand for these other precious metals this is not really surprising. Indeed, it is surprising that they have not fallen back as much as might have been expected under the circumstances, particularly in the case of silver.
The reason for this, of course, relates to the degree of industrial usage in the demand for the precious metals. Gold's industrial usage is relatively small in relation to its industrial demand. Silver demand is perhaps relatively evenly divided between investment and industrial use, while platinum and palladium have a far stronger industrial element in their demand. And, given that much of the economic uncertainty revolves around fears that U.S. and Western economies may not be recovering as expected, while there are some doubts expressed over Chinese growth being maintained at recent levels, the moves by the precious metals begin to make sense.
The doomsayers have been predicting another market collapse for some months now and found it difficult to understand what seemed to be climbing stock prices in the face of what they saw as an obvious financial meltdown brewing. The gold bulls have been predicting the rise in price - but the speed of the increase in the past couple of weeks will have taken many of even the ardent bulls by surprise.
But then the silver bulls have been looking for an even sharper increase in their favourite metal, but it hasn't happened - yet!
One has to learn from 2008 though when worries then about global recovery sent stocks crashing - and industrial commodities - and related mining stocks - were amongst the worst hit of all. So far this time, one could say that silver, in particular, which suffered really badly in 2008 falling from over $20 at peak to around $8 at its nadir, has actually performed pretty well by comparison. This could bode particularly well for its future once the market falls are over, assuming it can maintain its position. To a great extent the silver price consolidation is almost certainly because of continuing strong investment demand from the Near and Far East, which was not quite so apparent three years ago
But the portents for the markets do not necessarily look good at the moment. If we draw parallels with2008/9, markets fell around 50% from peak to bottom and if this pattern repeats there's an awfully long way down to go yet and virtually all kinds of stocks and commodity prices could be hit again too - even relating to those which are considered safe havens like gold. Putting such parallels in place, the S&P could fall to around 675 and the FTSE to 3000. Very worrying statistics for market investors!
But before gold stocks investors start patting themselves on the back for selecting the ultimate safe haven, it is worth noting that gold itself fell around 30% and the Amex Gold Bugs Index - the HUI - fell more than 60%, although both recovered far faster than other market sectors. Gold for example regained its losses in about 4 months, while the S&P at its recent high point still remained well below its 2007/2008 peaks.
But maybe things will be different for precious metals this time. The big problem though is that if markets continue falling, potentially strong sectors, like gold and gold stocks, need to be sold off to cover losses elsewhere - hence everything can fall back, and probably will. Juniors become particularly vulnerable as sources of finance tend to dry up.
What the precious metals investor may have learnt from 2008 though is that the market collapse then created some enormous buying opportunities. In the three years since 2008 fortunes were made in carefully picked gold stocks and the same could happen again. The problem here is to get back in at, or near, the bottom and that may not be for a couple of months yet and stocks could fall a long way in the meantime.
On the other hand, markets are fickle. They are falling at the moment because investor confidence has diminished dramatically - not necessarily because companies are doing any worse. Indeed gold producers at the moment should be making record profits given current prices and they find it hard to understand why their stocks are falling too. The gold majors should be the safest options but these have all also come back between 5 and 10% in the past few weeks - even Newmont which has promised to tie dividends to the gold price and thus promises increased yields for investors. The falls here are not nearly as bad though, as say major banks. Bank of America for example has fallen more than 30% in the past few days.
A change in sentiment though will see markets recover, but now no-one believes politicians' attempts to talk up the economy. The U.S. in particular, shot itself in the foot over the debt ceiling wrangles and this, taken in conjunction with the Eurozone debt problems and the S&P downgrade, was probably the straw that broke the camel's back. It may take some time yet for investor confidence to recover.
But what about the other main ‘precious' metals - silver, platinum and palladium. In 2008 silver plunged around 60%, platinum around 65% and palladium around 70%. Horrendous figures for investors at the time. This time around - again assuming a parallel crash to that of 2008, there is a chance that similar plunges will not occur - at least perhaps not to the same magnitude. Gold is a great deal higher now and there has always been an element of the other precious metals moving in conjunction. As noted above, silver has become much more of an investment metal in its own right - particularly as gold has become too expensive for the smaller investor to purchase and they are finding an outlet in silver which perhaps was not there three years ago. The fact that platinum is currently selling at around below the gold price - a situation that has not tended to persist for long in the past - may lend some support here too and palladium may well move in concert. The suggestion here is that either gold is due a fall from its current heights, or platinum may pick up a little.
The situation is certainly interesting and will tax the thoughts of those looking to protect what they have. To this observer the gold price at current levels may be a little vulnerable to profit taking, while there may be a flight to cash as investment professionals seek to try and buy time until they have a better handle on which way markets will move. Uncertain times!
Monday 8 August 2011
TOP NEWS : Gold Surges Through USD $1,700 /oz
Maklumat yang terkandung di sini telah diperolehi daripada sumber-sumber yang dipercayai boleh dipercayai, tetapi tidak ada jaminan kepada kesempurnaan atau ketepatan. Setiap pendapat yang dinyatakan di sini adalah kenyataan pertimbangan kami pada tarikh ini dan tertakluk kepada perubahan tanpa notis.
LONDON (Reuters) -
The gold price was set for its second largest daily gain this year on Monday after the respective pledges by the G7 and the European Central Bank to quell the turbulence in the financial markets did nothing to put investors at ease.
In Europe, Spanish and Italian bond yields fell. Traders said the ECB had made good on its promise to solve the euro zone debt crisis by widening its bond-buying programme to include paper from those two nations.
Friday's downgrade to the quality of U.S. sovereign debt by ratings agency Standard & Poor's was widely anticipated, but its longer-term impact on anything from mortgage rates to the economy is unclear.
Investors have bought more gold in the last month than in the prior six months, looking at the increase in open interest on COMEX for speculators and money managers, as well as inflows into exchange-traded products.
Spot gold was set for a second consecutive trading rally, up 2.7 percent from Friday at $1,706.44 an ounce by 0900 GMT, having hit a record $1,715.01 earlier and having traded at all-time highs in sterling and euros .
"Everyone was talking about Armageddon at the weekend and this morning, it's held the rot but doesn't remove the themes that have been driving the stock markets," said Saxo Bank senior manager Ole Hansen.
"The question right now is if gold will be allowed to move much further. There has been a huge build-up in speculative and long positions across the board over the last couple of weeks, but I suppose that central banks buying more bonds is not helping the overall worry about how the economies are going to do over the months ahead," he said.
According to data from the Commodity Futures Trading Commission, which collects information on holdings of futures and options, and to ETF data collected by Reuters, investors bought over 18 million ounces of gold, or 30 percent of total identifiable investment demand in 2010, in the last month alone, compared with about 8.4 million in the year to early July.
Finance chiefs from the world's industrial powers pledged on Sunday to take whatever actions were needed to steady financial markets, spooked by the political wrangling in Europe and the United States over slashing their huge budget deficits.
FEWER "SAFE" HAVENS?
Treasury Secretary Timothy Geithner said U.S. Treasury debt is as safe as it was before the S&P downgrade, urging European leaders to ensure there is an "unequivocal financial backstop" for euro zone governments facing fiscal and debt problems.
"The uncertainty in the financial markets is keeping gold prices underpinned. It's essentially safe-haven buying," said Ong Yi Ling, investment analyst at Phillip Futures.
"One of the events that investors will watch is of course the FOMC meeting that is scheduled Tuesday ... investors will scrutinise the statement on the assessment of the economy and outlook for monetary policy."
Investors are watching for any statement on whether the Fed will ease monetary policy further.
The prospect of an even longer period of low U.S. interest rates prompted Goldman Sachs to raise its longer-term forecast for the gold price. Goldman said it had lifted its forecasts to $1,645, $1,730 and $1,860 on a three-, six- and 12-month horizon, respectively. Goldman had previously forecast the gold price peaking at $1,600 an ounce in mid-2012.
Meanwhile, gold in euros hit a record 1,195.66 euros an ounce, bringing gains in the last month alone to over 12 percent, while gold in sterling hit a peak of 1,043.76 pounds, for a gain of 9.3 percent in the same period.
In other precious metals, silver got a lift from the strength in gold as it can sometimes act as a cheaper safe-haven proxy for investor.
Spot silver was last up 3.7 percent on the day at $39.72 an ounce, while the more industrial platinum group metals reacted to the gloom in the broader commodity markets.
Platinum was flat on the day, around $1,714.00 an ounce, while palladium was down nearly 2 percent at $725.50. The palladium price has fallen by more than 14 percent in the last 6 trading days, since hitting a five-month high. (Additional reporting by Lewa Pardomuan in Singapore; Editing by Alison Birrane)
LONDON (Reuters) -
The gold price was set for its second largest daily gain this year on Monday after the respective pledges by the G7 and the European Central Bank to quell the turbulence in the financial markets did nothing to put investors at ease.
In Europe, Spanish and Italian bond yields fell. Traders said the ECB had made good on its promise to solve the euro zone debt crisis by widening its bond-buying programme to include paper from those two nations.
Friday's downgrade to the quality of U.S. sovereign debt by ratings agency Standard & Poor's was widely anticipated, but its longer-term impact on anything from mortgage rates to the economy is unclear.
Investors have bought more gold in the last month than in the prior six months, looking at the increase in open interest on COMEX for speculators and money managers, as well as inflows into exchange-traded products.
Spot gold was set for a second consecutive trading rally, up 2.7 percent from Friday at $1,706.44 an ounce by 0900 GMT, having hit a record $1,715.01 earlier and having traded at all-time highs in sterling and euros .
"Everyone was talking about Armageddon at the weekend and this morning, it's held the rot but doesn't remove the themes that have been driving the stock markets," said Saxo Bank senior manager Ole Hansen.
"The question right now is if gold will be allowed to move much further. There has been a huge build-up in speculative and long positions across the board over the last couple of weeks, but I suppose that central banks buying more bonds is not helping the overall worry about how the economies are going to do over the months ahead," he said.
According to data from the Commodity Futures Trading Commission, which collects information on holdings of futures and options, and to ETF data collected by Reuters, investors bought over 18 million ounces of gold, or 30 percent of total identifiable investment demand in 2010, in the last month alone, compared with about 8.4 million in the year to early July.
Finance chiefs from the world's industrial powers pledged on Sunday to take whatever actions were needed to steady financial markets, spooked by the political wrangling in Europe and the United States over slashing their huge budget deficits.
FEWER "SAFE" HAVENS?
Treasury Secretary Timothy Geithner said U.S. Treasury debt is as safe as it was before the S&P downgrade, urging European leaders to ensure there is an "unequivocal financial backstop" for euro zone governments facing fiscal and debt problems.
"The uncertainty in the financial markets is keeping gold prices underpinned. It's essentially safe-haven buying," said Ong Yi Ling, investment analyst at Phillip Futures.
"One of the events that investors will watch is of course the FOMC meeting that is scheduled Tuesday ... investors will scrutinise the statement on the assessment of the economy and outlook for monetary policy."
Investors are watching for any statement on whether the Fed will ease monetary policy further.
The prospect of an even longer period of low U.S. interest rates prompted Goldman Sachs to raise its longer-term forecast for the gold price. Goldman said it had lifted its forecasts to $1,645, $1,730 and $1,860 on a three-, six- and 12-month horizon, respectively. Goldman had previously forecast the gold price peaking at $1,600 an ounce in mid-2012.
Meanwhile, gold in euros hit a record 1,195.66 euros an ounce, bringing gains in the last month alone to over 12 percent, while gold in sterling hit a peak of 1,043.76 pounds, for a gain of 9.3 percent in the same period.
In other precious metals, silver got a lift from the strength in gold as it can sometimes act as a cheaper safe-haven proxy for investor.
Spot silver was last up 3.7 percent on the day at $39.72 an ounce, while the more industrial platinum group metals reacted to the gloom in the broader commodity markets.
Platinum was flat on the day, around $1,714.00 an ounce, while palladium was down nearly 2 percent at $725.50. The palladium price has fallen by more than 14 percent in the last 6 trading days, since hitting a five-month high. (Additional reporting by Lewa Pardomuan in Singapore; Editing by Alison Birrane)
TOP NEWS Oil and Stocks Fall....GOLD RISES RECORD HIGH
Maklumat yang terkandung di sini telah diperolehi daripada sumber-sumber yang dipercayai boleh dipercayai, tetapi tidak ada jaminan kepada kesempurnaan atau ketepatan. Setiap pendapat yang dinyatakan di sini adalah kenyataan pertimbangan kami pada tarikh ini dan tertakluk kepada perubahan tanpa notis.
SINGAPORE,Monday 08/08/2011: Gold surged to a record on Monday and other commodities from oil to grains fell as investors cut riskier assets after the United States lost its top-notch AAA credit rating.
Oil dropped more than $3, while copper, wheat and corn retreated as the outlook for commodity demand deteriorated amid shaky Western economies and a debt crisis in both sides of the Atlantic.
Asian shares slid and the dollar touched a record low versus the Swiss franc, as global policymakers put a brave face on the debt issues hounding the United States and Europe, although their pledge to ensure liquidity did little to pacify nervous investors.
Benefiting from the gloom, gold climbed to an all-time high above $1,703 an ounce, its 11th record in 19 sessions, as investors sought shelter in the precious metal from the turmoil engulfing financial and commodity markets. Gold has gained more than 19 percent so far this year.
"What people are realizing is that dollar and euro currencies have real problems and I think that's manifesting in the gold price," said Dominic Schnider, executive director for wealth management research at UBS.
"I would say the way things evolve right now I really could even imagine $2,000 being in the cards."
Schnider said there was a risk gold could hit that level even before the end of the year if the global economy "does not accelerate, things go really nasty and central banks start to have large purchasing programs of government-related debt".
With the twin debt crises raging and sending equities and commodities plunging, the Group of Seven leaders said they were "ready to take action to ensure stability and liquidity in financial markets".
That followed a surprise statement from the European Central Bank that it would "actively implement" its controversial bond-buying programme to fight the euro zone's debt crisis.
U.S. gold futures also touched a record of $1,705.90 an ounce, while both spot and U.S. silver futures jumped more than 5 percent.
CHINA FACTOR
Standard & Poor's cut the long-term U.S. credit rating to AA-plus on Friday, a move that over time could ripple through markets by pushing up borrowing costs and making it more difficult to secure a lasting recovery.
"In our view, the biggest immediate risk to commodity prices is not the actual downgrade but a further rise in global economic uncertainty and policy risk," Standard Bank analyst Walter de Wet said in a note to clients.
U.S. crude, which is down 7.5 percent so far this year, fell $3.02 to $83.86 a barrel, after hitting a low of $83.55, marking its sixth loss in seven sessions.
Brent oil, up nearly 13 percent on the year, slipped $2.71 to $106.66, off a low of $106.20.
London copper dropped 0.6 percent to $8,990 a tonne, after falling to as low as $8,950 earlier, its weakest since June 27.
In agricultural markets, U.S. soybeans slid to a one-month low, while corn and wheat dropped.
Strong economic growth in China -- the world's top copper consumer, No. 2 oil user and major buyer of grains -- as well as tight global supplies for some raw materials, including coal and iron ore, should provide support to prices.
"China seems to be ticking over fine so commodity demand should be fine," said Graeme Train, commodity analyst at Macquarie in Shanghai.
"China has destocked over the last 12 months after a big round of buying at lower commodity prices. It's potentially set up to do the same kind of buying where an opportunity presents itself."
The Reuters-Jefferies CRB index , the 19-commodity benchmark, fell nearly 4.5 percent last week, its steepest drop since a rout in early May fuelled by concerns about a stalling global economic recovery.
SINGAPORE,Monday 08/08/2011: Gold surged to a record on Monday and other commodities from oil to grains fell as investors cut riskier assets after the United States lost its top-notch AAA credit rating.
Oil dropped more than $3, while copper, wheat and corn retreated as the outlook for commodity demand deteriorated amid shaky Western economies and a debt crisis in both sides of the Atlantic.
Asian shares slid and the dollar touched a record low versus the Swiss franc, as global policymakers put a brave face on the debt issues hounding the United States and Europe, although their pledge to ensure liquidity did little to pacify nervous investors.
Benefiting from the gloom, gold climbed to an all-time high above $1,703 an ounce, its 11th record in 19 sessions, as investors sought shelter in the precious metal from the turmoil engulfing financial and commodity markets. Gold has gained more than 19 percent so far this year.
"What people are realizing is that dollar and euro currencies have real problems and I think that's manifesting in the gold price," said Dominic Schnider, executive director for wealth management research at UBS.
"I would say the way things evolve right now I really could even imagine $2,000 being in the cards."
Schnider said there was a risk gold could hit that level even before the end of the year if the global economy "does not accelerate, things go really nasty and central banks start to have large purchasing programs of government-related debt".
With the twin debt crises raging and sending equities and commodities plunging, the Group of Seven leaders said they were "ready to take action to ensure stability and liquidity in financial markets".
That followed a surprise statement from the European Central Bank that it would "actively implement" its controversial bond-buying programme to fight the euro zone's debt crisis.
U.S. gold futures also touched a record of $1,705.90 an ounce, while both spot and U.S. silver futures jumped more than 5 percent.
CHINA FACTOR
Standard & Poor's cut the long-term U.S. credit rating to AA-plus on Friday, a move that over time could ripple through markets by pushing up borrowing costs and making it more difficult to secure a lasting recovery.
"In our view, the biggest immediate risk to commodity prices is not the actual downgrade but a further rise in global economic uncertainty and policy risk," Standard Bank analyst Walter de Wet said in a note to clients.
U.S. crude, which is down 7.5 percent so far this year, fell $3.02 to $83.86 a barrel, after hitting a low of $83.55, marking its sixth loss in seven sessions.
Brent oil, up nearly 13 percent on the year, slipped $2.71 to $106.66, off a low of $106.20.
London copper dropped 0.6 percent to $8,990 a tonne, after falling to as low as $8,950 earlier, its weakest since June 27.
In agricultural markets, U.S. soybeans slid to a one-month low, while corn and wheat dropped.
Strong economic growth in China -- the world's top copper consumer, No. 2 oil user and major buyer of grains -- as well as tight global supplies for some raw materials, including coal and iron ore, should provide support to prices.
"China seems to be ticking over fine so commodity demand should be fine," said Graeme Train, commodity analyst at Macquarie in Shanghai.
"China has destocked over the last 12 months after a big round of buying at lower commodity prices. It's potentially set up to do the same kind of buying where an opportunity presents itself."
The Reuters-Jefferies CRB index , the 19-commodity benchmark, fell nearly 4.5 percent last week, its steepest drop since a rout in early May fuelled by concerns about a stalling global economic recovery.
GOLD IS MONEY
Maklumat yang terkandung di sini telah diperolehi daripada sumber-sumber yang dipercayai boleh dipercayai, tetapi tidak ada jaminan kepada kesempurnaan atau ketepatan. Setiap pendapat yang dinyatakan di sini adalah kenyataan pertimbangan kami pada tarikh ini dan tertakluk kepada perubahan tanpa notis.
Can gold lead the way back to a 'true' value of money?
Announcements by the Bank of Japan and the Swiss National Bank that they are to weaken their currencies are the latest indictment of the weaknesses in the global currency system; can gold really provide a solution?
This was a deeply significant week in the global monetary system. For the last 40 years the developed world has insisted that currencies are the definitive money and that gold -and silver too-is a ‘barbarous relic'. Reflect on currency and national debt management over the last four years and the decade of blithe confidence before that - the smart money went into gold during this time and has multiplied six times in a decade.
The announcements by both the Bank of Japan and the Swiss National Bank that they were to weaken their currencies means neither the Swiss Franc nor the Japanese Yen are ‘safe havens' against a falling U.S. dollar and Euro. Furthermore, these actions are an indictment of the system of currencies as alternatives to other currencies.
This elevates gold and silver as ‘counters to currencies'.
This consequence has arisen because of the, now clear, failure of the U.S. Congress to rein in spending sufficiently, or to raise taxes, in a manner able to rein in the U.S. deficit. The cuts over the next decade [most after 2017] will reduce spending by 0.5% of GDP. The deficit stands at 10% of GDP. This is detrimental to the dollar as the global reserve currency.
Currencies as Money
When President Nixon cut the dollar loose for gold he and subsequent governments held the dollar up as the only real money, with other currencies following the same path. Prior to that, civilizations going back thousands of years accepted only gold-backed money. Gold was real money then, with notes drawn on the gold they represented. It was that link that defined it as money.
What was not flagged when Nixon cut the link to gold was the reality that governments replaced gold as the backing for money notes. Previously you could present your dollar for a dollar's worth of gold and you got it; foreign governments could do the same. After the gold window was closed, whenever you presented your dollar you received another paper dollar. Remarkably the trick worked. Add to that -a 30-year long campaign to discredit gold as money through central bank and accelerated gold sales and you left everybody with no alternative to paper money. For 40 years the experiment worked well with everybody convinced that at the heart of the new monetary system was the U.S. dollar, based on the soundness of the U.S. economy and global influence. The link to oil ensured it was the prime means of exchange used globally for basic energy needs, ensuring its indispensability.
Its success was so great that instead of gold pricing paper money, paper money priced gold. Instead of $42 equaling an ounce of gold, an ounce of gold equaled $42.
But the only way this system could work well and permanently, was for it to sustain its value on a steady, unflinching, immoveable path. This meant that everything should be measurable against it, constantly and reliably. Unfortunately governments are made up of politicians who belong to different parties. They represent a nation that has a variable budget and a tendency to be crowd-pleasers. Their role is to give the people what they want, and people's wants are often not consistent with a steady, constant measure of value. Structurally, these two concepts clash. Therefore, the experiment had a time limit from the very beginning
In the past, the central bank of a nation has been charged with ensuring that a nation's money provides price stability, but that is not the same as a measure of value. Presently, central banks see themselves as encouraging growth, jobs, and a variable supply of money to back up, but not be responsible for the state of a nation's economy. This turns paper money into a changeable item of varying value.
Take for instance the dollar and the euro at the time of the euro's inception. They were at a value of 1:1. Today, they are at a value of €1: $1.43, a decline in exchange rate value of 43 cents. Both the Euro and the USD have fallen in value against other strong currencies such as the Yen and the Swiss Franc. Many investors hoped that the Swiss Franc and the Yen would act as true measures of value when the USD and the Euro failed. That fallacy revealed itself again as the nation's central banks act to weaken the value of their currencies through their printing machines. This is the only way an economy's global competitive position can be protected. But the cost is the loss of ability by the national currency to provide value. More than that, the action this week, by the B of J and the SNB confirmed that the strongest global currencies will not allow themselves to be reliable measures of value.
The net result: we have to face the stark reality that the currency system we now live under globally cannot provide a true measure of value.
Gold Sales Will No Longer Work
A global measure of value can only be provided by something that cannot be manipulated by a government, for whatever reason. Furthermore, it must be something that cannot be managed by a single, or even several governments -as was the case from 1971 until central banks gold sales stopped in around 2009. The condition that has arrived is that, if one government tried to manipulate the price down, another government would buy the gold put on sale. This would prevent a repeat of the central banks' gold sales programs of the last 35 years. With every government wanting to hold the gold or buy more, we now have a global consensus that gold is a vital reserve asset, the way it was before 1971.
The path back to money has to be taken, but what will it entail?
Ref:Julian D.W. Philips for the Gold & Silver Forecasters - www.goldforecaster.com and www.silverforecaster.com
Can gold lead the way back to a 'true' value of money?
Announcements by the Bank of Japan and the Swiss National Bank that they are to weaken their currencies are the latest indictment of the weaknesses in the global currency system; can gold really provide a solution?
This was a deeply significant week in the global monetary system. For the last 40 years the developed world has insisted that currencies are the definitive money and that gold -and silver too-is a ‘barbarous relic'. Reflect on currency and national debt management over the last four years and the decade of blithe confidence before that - the smart money went into gold during this time and has multiplied six times in a decade.
The announcements by both the Bank of Japan and the Swiss National Bank that they were to weaken their currencies means neither the Swiss Franc nor the Japanese Yen are ‘safe havens' against a falling U.S. dollar and Euro. Furthermore, these actions are an indictment of the system of currencies as alternatives to other currencies.
This elevates gold and silver as ‘counters to currencies'.
This consequence has arisen because of the, now clear, failure of the U.S. Congress to rein in spending sufficiently, or to raise taxes, in a manner able to rein in the U.S. deficit. The cuts over the next decade [most after 2017] will reduce spending by 0.5% of GDP. The deficit stands at 10% of GDP. This is detrimental to the dollar as the global reserve currency.
Currencies as Money
When President Nixon cut the dollar loose for gold he and subsequent governments held the dollar up as the only real money, with other currencies following the same path. Prior to that, civilizations going back thousands of years accepted only gold-backed money. Gold was real money then, with notes drawn on the gold they represented. It was that link that defined it as money.
What was not flagged when Nixon cut the link to gold was the reality that governments replaced gold as the backing for money notes. Previously you could present your dollar for a dollar's worth of gold and you got it; foreign governments could do the same. After the gold window was closed, whenever you presented your dollar you received another paper dollar. Remarkably the trick worked. Add to that -a 30-year long campaign to discredit gold as money through central bank and accelerated gold sales and you left everybody with no alternative to paper money. For 40 years the experiment worked well with everybody convinced that at the heart of the new monetary system was the U.S. dollar, based on the soundness of the U.S. economy and global influence. The link to oil ensured it was the prime means of exchange used globally for basic energy needs, ensuring its indispensability.
Its success was so great that instead of gold pricing paper money, paper money priced gold. Instead of $42 equaling an ounce of gold, an ounce of gold equaled $42.
But the only way this system could work well and permanently, was for it to sustain its value on a steady, unflinching, immoveable path. This meant that everything should be measurable against it, constantly and reliably. Unfortunately governments are made up of politicians who belong to different parties. They represent a nation that has a variable budget and a tendency to be crowd-pleasers. Their role is to give the people what they want, and people's wants are often not consistent with a steady, constant measure of value. Structurally, these two concepts clash. Therefore, the experiment had a time limit from the very beginning
In the past, the central bank of a nation has been charged with ensuring that a nation's money provides price stability, but that is not the same as a measure of value. Presently, central banks see themselves as encouraging growth, jobs, and a variable supply of money to back up, but not be responsible for the state of a nation's economy. This turns paper money into a changeable item of varying value.
Take for instance the dollar and the euro at the time of the euro's inception. They were at a value of 1:1. Today, they are at a value of €1: $1.43, a decline in exchange rate value of 43 cents. Both the Euro and the USD have fallen in value against other strong currencies such as the Yen and the Swiss Franc. Many investors hoped that the Swiss Franc and the Yen would act as true measures of value when the USD and the Euro failed. That fallacy revealed itself again as the nation's central banks act to weaken the value of their currencies through their printing machines. This is the only way an economy's global competitive position can be protected. But the cost is the loss of ability by the national currency to provide value. More than that, the action this week, by the B of J and the SNB confirmed that the strongest global currencies will not allow themselves to be reliable measures of value.
The net result: we have to face the stark reality that the currency system we now live under globally cannot provide a true measure of value.
Gold Sales Will No Longer Work
A global measure of value can only be provided by something that cannot be manipulated by a government, for whatever reason. Furthermore, it must be something that cannot be managed by a single, or even several governments -as was the case from 1971 until central banks gold sales stopped in around 2009. The condition that has arrived is that, if one government tried to manipulate the price down, another government would buy the gold put on sale. This would prevent a repeat of the central banks' gold sales programs of the last 35 years. With every government wanting to hold the gold or buy more, we now have a global consensus that gold is a vital reserve asset, the way it was before 1971.
The path back to money has to be taken, but what will it entail?
Ref:Julian D.W. Philips for the Gold & Silver Forecasters - www.goldforecaster.com and www.silverforecaster.com
Thursday 4 August 2011
Top News: Central Banks of World's Nation Buying More GOLD. ( Anda jangan ketinggalan)
Maklumat yang terkandung di sini telah diperolehi daripada sumber-sumber yang dipercayai boleh dipercayai, tetapi tidak ada jaminan kepada kesempurnaan atau ketepatan. Setiap pendapat yang dinyatakan di sini adalah kenyataan pertimbangan kami pada tarikh ini dan tertakluk kepada perubahan tanpa notis.
Emerging market central banks put $10bn into gold year-to-date
Thailand and South Korea are the latest emerging economies to put their money into gold as concerns abound about the strength of western benchmarks like the dollar and the euro
Author: Amanda Cooper (Reuters)
Posted: Wednesday , 03 Aug 2011
LONDON (Reuters) -
Central banks of emerging market countries such as Korea and Thailand have added more than $10 billion of gold to their reserves this year in a sign of waning faith in the West's benchmark bonds and currencies like the dollar and the euro.
International Monetary Fund data for June on Wednesday showed Thailand bought gold for the second time this year, raising its reserves by nearly 19 tonnes to over 127 tonnes, while Russia bought another 5.85 tonnes, bringing its reserves to 836.7 tonnes, the world's eighth largest official stash of the metal.
So far in 2011, emerging market central banks have bought nearly 180 tonnes of gold, more than double the roughly 73 tonnes purchased by central banks globally in the whole of 2010.
The spot price of gold has risen by more than 17 percent this year to a record $1,672.65 an ounce, driven chiefly by investor concerns over the impact on the developed world's economy of its debt burdens and sluggish growth.
Mexico has been the largest buyer of gold in the year to date, with $5.3 billion worth of purchases, or 98 tonnes of gold, followed by Russia, which has bought 48 tonnes, worth $2.6 billion at current prices.
Earlier this week, Korea confirmed it had bought 25 tonnes of gold in June and July.
"Central banks evidently do not regard the price level as too high and are diversifying their currency reserves. This was the first purchase of gold for the Korean central bank in over ten years," said Commerzbank metals analyst Daniel Briesemann.
"Gold's high-altitude flight still appears to be supported by many factors and an end to the boom soon is not in sight."
In the euro zone, smaller economies such as Greece, Portugal and Ireland have already sought emergency funding, while concern is mounting over the finances of some of the region's larger members such as Spain and Italy, driving the euro to record lows against the safe-haven Swiss franc.
The United States averted an unprecedented debt default on Tuesday after lawmakers reached an eleventh-hour deal to raise the country's borrowing limit, although severe doubts remain about the economic outlook, stripping 6 percent off the value of the dollar .DXY this year.
DEBT MISERY
The U.S. economy is also likely to lose its top-notch credit rating as ratings agencies are increasingly discomfited by the weight of the twin trade and budget deficits and the country's patchy growth.
A downgrade will almost certainly push up yields on U.S. Treasury notes as their value falls, which could prove unwelcome to the major investors in U.S. debt such as the Chinese government, which holds nearly $900 billion in Treasuries.
The trend among central banks, particularly those with large foreign exchange holdings, to diversify some of their portfolios into gold from currencies has been well established over the last couple of years.
"The market generally expects central banks with growing reserves and small gold holdings to buy gold," said Jesper Dannesboe, senior commodity strategist at Societe Generale."
"So I don't think that is particular surprising, but it does support the bullish story (for gold)," he said.
Central banks are expected to remain net buyers of gold this year and the most likely buyers will be those with the biggest reserves and relatively small bullion holdings, such as China.
The Chinese central bank is the sixth largest official owner of gold, yet its holdings account for just 1.6 percent of its $2.5 trillion total reserves.
The IMF data showed Russia, Kazakhstan, Greece, Ukraine and Tajikistan also added to their reserves two months ago and feature among some of the bigger bullion buyers this year.
Kazakhstan's reserves rose for the third time this year, by 3.11 tonnes in June to 70.434 tonnes, Taijikistan's reserves rose 0.04 tonnes to 3.036 tonnes and Greece and Ukraine added 0.03 tonnes each, bringing their official holdings of gold to 111.506 tonnes and 27.744 tonnes, respectively.
Russia has added to its gold reserves every month for the past five years, according to the IMF's data.
Emerging market central banks put $10bn into gold year-to-date
Thailand and South Korea are the latest emerging economies to put their money into gold as concerns abound about the strength of western benchmarks like the dollar and the euro
Author: Amanda Cooper (Reuters)
Posted: Wednesday , 03 Aug 2011
LONDON (Reuters) -
Central banks of emerging market countries such as Korea and Thailand have added more than $10 billion of gold to their reserves this year in a sign of waning faith in the West's benchmark bonds and currencies like the dollar and the euro.
International Monetary Fund data for June on Wednesday showed Thailand bought gold for the second time this year, raising its reserves by nearly 19 tonnes to over 127 tonnes, while Russia bought another 5.85 tonnes, bringing its reserves to 836.7 tonnes, the world's eighth largest official stash of the metal.
So far in 2011, emerging market central banks have bought nearly 180 tonnes of gold, more than double the roughly 73 tonnes purchased by central banks globally in the whole of 2010.
The spot price of gold has risen by more than 17 percent this year to a record $1,672.65 an ounce, driven chiefly by investor concerns over the impact on the developed world's economy of its debt burdens and sluggish growth.
Mexico has been the largest buyer of gold in the year to date, with $5.3 billion worth of purchases, or 98 tonnes of gold, followed by Russia, which has bought 48 tonnes, worth $2.6 billion at current prices.
Earlier this week, Korea confirmed it had bought 25 tonnes of gold in June and July.
"Central banks evidently do not regard the price level as too high and are diversifying their currency reserves. This was the first purchase of gold for the Korean central bank in over ten years," said Commerzbank metals analyst Daniel Briesemann.
"Gold's high-altitude flight still appears to be supported by many factors and an end to the boom soon is not in sight."
In the euro zone, smaller economies such as Greece, Portugal and Ireland have already sought emergency funding, while concern is mounting over the finances of some of the region's larger members such as Spain and Italy, driving the euro to record lows against the safe-haven Swiss franc.
The United States averted an unprecedented debt default on Tuesday after lawmakers reached an eleventh-hour deal to raise the country's borrowing limit, although severe doubts remain about the economic outlook, stripping 6 percent off the value of the dollar .DXY this year.
DEBT MISERY
The U.S. economy is also likely to lose its top-notch credit rating as ratings agencies are increasingly discomfited by the weight of the twin trade and budget deficits and the country's patchy growth.
A downgrade will almost certainly push up yields on U.S. Treasury notes as their value falls, which could prove unwelcome to the major investors in U.S. debt such as the Chinese government, which holds nearly $900 billion in Treasuries.
The trend among central banks, particularly those with large foreign exchange holdings, to diversify some of their portfolios into gold from currencies has been well established over the last couple of years.
"The market generally expects central banks with growing reserves and small gold holdings to buy gold," said Jesper Dannesboe, senior commodity strategist at Societe Generale."
"So I don't think that is particular surprising, but it does support the bullish story (for gold)," he said.
Central banks are expected to remain net buyers of gold this year and the most likely buyers will be those with the biggest reserves and relatively small bullion holdings, such as China.
The Chinese central bank is the sixth largest official owner of gold, yet its holdings account for just 1.6 percent of its $2.5 trillion total reserves.
The IMF data showed Russia, Kazakhstan, Greece, Ukraine and Tajikistan also added to their reserves two months ago and feature among some of the bigger bullion buyers this year.
Kazakhstan's reserves rose for the third time this year, by 3.11 tonnes in June to 70.434 tonnes, Taijikistan's reserves rose 0.04 tonnes to 3.036 tonnes and Greece and Ukraine added 0.03 tonnes each, bringing their official holdings of gold to 111.506 tonnes and 27.744 tonnes, respectively.
Russia has added to its gold reserves every month for the past five years, according to the IMF's data.
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