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Gold has recently been firming. The current last sale is $596.20
The following are a few comments made today by Mr. James Sinclair at jsmineset.com concerning gold’s recent weakness from about the $610 area to just above $560:
1- The battle has been won.
2- The lows are in.
3- Setbacks are an opportunity, not precipices from which more pain looms.
The Assosciated Press released for publication in our local paper yesterday, October 15, 06, an article entitled, Commodities Continue to Founder written by Ellen Simon.
Ms Simon mistakenly includes gold as being a commodity. Gold is a commodity when the world’s financial house is in order and it is a currency when that house, especially the U.S.’s house, is out of order.
Here is the slant in the article that forecasts a lower gold price.
“Commodities prices tend to have a domino effect – lower oil prices often drag down gold prices.”
“While emerging markets continue to be on a tear, if the commodity bears are right, there may be plenty of pain to spread around.”
Richard Bernstein says,”(commodity) prices are now 60% above what could be explained by fundamental supply and demand. These data suggest that September’s downfall in commodities might only be the beginning of a protacted bear market.”
Tobias Levkovich, Citigroup Inc.”s chief U.S. strategist says, While the argument for continued high prices for commodities is that demand will continue to grow, Levkovich points out that there’s some room for supply to grow, too, with a possible increase in Saudi oil production and a recent Chevron Corp. find in the Gulf of Mexico.
So here’s the thesis, gold is going lower because oil is going lower. Don’t bet your house on it.
The new field in the Gulf will probably take 10 years or so to bring into full production.
The rule in Saudi Arabia by the Royals should be considered temporary, at best. It is just a matter of time before the Muslim fundamentalists force them out. Prior to that happening, don’t be surprised if the oil producing infrastructure starts to get attacked. When that happens, oil and gold will rapidly advance.
Gold is in the midst of a bull market shakeout being engineered by the aforementioned miscreants along with amplification from the hedge funds with their computer trading models.
Wild swings are just part of the personality of this current bull market. The hedge funds with their great investor wealth will follow any spurts of strength or weakness.
Hedge funds are market gun slingers. They are usually run by young and inexperienced traders. Might does not make right. Recently, two hedge funds have declared bankruptcy.
The pendulum swings both ways.
Bluejay:
What do you think of the gold price today????“I’m unashamedly, utterly bullish on gold,” Newmont Mining president Pierre Lassonde said at an industry conference in Denver on September 27th.
“The current-account deficit in this country is going to reach a trillion dollars very shortly. The dollar has nowhere to go but down.”
Rick
There is a tutorial on some facets of charting tonight at the http://www.jsmineset.com.
This is an excellent lesson and puts you right in the classroom with an experienced instructor.
Rick
This section was started when gold entered a major bull market in November of 2002. Although some time has passed, the gold bull market is no where near completion.
You should have opportunities ahead or possibly, even now. Gold is currently up about $30 from its recent low. Gold should be bought each time that prices look like they are being pulled into the abyss. This is accomplished by buying lower and lower until the decline comes to a halt.
I have some silver along with other precious metal items. In 2004 silver got spanked for declines of 35% in March and 27% in December. I bought at $5.90 and $6.75, respectively. In this case, I didn’t buy on a scale down basis but bought when there was panic selling followed by a little wait.
The point is, your leverage for profit comes in buying down markets, not up markets within bull phases. In order to operate this way, you have to leave the safety of the flock and start acting independently and responsibly.
You can easily figure out for yourself a purchase plan that best suits you. You should spend some time going over the monthly gold chart for percentage price gyrations and become familiar with their extremes. You can view this chart by going to http://www.tradingcharts.com and hitting commodity charts and selecting metals.
In addition, you should check out a book from the library entitled Technical Analysis Of Stock Trends by Edwards and Mcgee. This will help you understand the probabilities of upcoming down moves so you can initiate your plan ahead of time by entering some orders.
Currently, the daily gold chart is forming a huge triangle. This recent decline could be it for awhile. Othwerwise, the probabilities for a strong rally into the $680 area seem to be on the increase. We’ll just have to wait and see. Good Luck
Bluejay…
Is this price a buy price or a wait price?
I prefer the concept of finding it and investing in the idea. But, I haven’t yet committed the dollars.
Why am I waiting?
The last on gold is $600.90.
In the early days of September gold was jolted lower from about $640 to about $570. The drop registered almost a 10% loss over the short period of a few days.
These drops are a common occurrence and should not be viewed as being anything different than business as usual within this current bull market.
The gold stocks suffered a more severe shock of about 18%. The gold stocks were susceptible as margin borrowing on them had reached high levels.
The upcoming November elections had a part to play in the metal’s weakness. A lower gold price would help people think of a lower inflation level and support a generally higher equities market. Along with declining interest rates over the interim the stock market is establishing some all time highs.
The appearence of a sound economy wins votes for the administration and their party.
We no longer live in a completely free market system in this country anymore. There are so many market deals being made behind the scenes just to get votes that it makes you wonder where all this abuse of power ends up.
The Exchange Stabilization Fund, the plunge protection team, was set up some years ago to prevent panic sell offs in the stock market. Now the Exchange Stabilization Fund is secretly controlling other markets. They even have their hand regularly in the gold market and who knows where else as a political tool of the administration.
Whether it be secret deals to get the price of gold lower between England, some large New York brokerage houses, the Exchange Stabilization Fund or just the FED presidents indiretly talking it down, gold will have its work cut out for itself during this bull market.
Somewhere along the road in time the actions of these miscreants will be silenced. Right now these entities are temporarily stealing upward energy from the gold bull.
The gold market is content to stockpile more and more ammunition as it watches this amateur drama unfold with indifference.
For long term gold investors, aside from the current market tinkering, your day will come.
BE PATIENT.
NOVAGOLD SUES BARRICK GOLD
The following was reported at 07:56 ET August 25, 2006 by CCN Matthews, “news distribution experts” in Canada.
Vancouver, British Columbia–NovaGold Resources. (TSX:NG)(AMEX:NG) announced today that it has filed a lawsuit against Barrick Gold Corporation (TSX:ABX)(NYSE:ABX) (“Barrick”) in the United States District Court for the District of Alaska.
The lawsuit alleges that Barrick has violated United States securities laws by making material misstatements with respect to Barrick’s interest in NovaGold’s Donlin Creek project in Alaska.
NovaGold currently holds a 70% interest in the venture through its subsidiary NovaGold Alaska; Barrick holds a 30% interest through its subsidiary Placer Dome U.S. Inc.
Barrick has repeatedly stated that it will earn a 70% interest (reducung NovaGold’s stake to 30%) by satisfying contractual back-in requirements on or before November 12, 2007.
The lawsuit alleges that these statements are false and that Barrick cannot satisfy those requirements.
The lawsuit seeks a temporary restraining order suspending Barrick’s unsolicited tender offer to acquire NovaGold pending an accelerated judgment by the court regarding what actions are necessary for Barrick to satisfy those requirements.
NovaGold is asking the court to order that the requirements include certain milestones (such as completion of an environmental impact statement, a bankable feasibility study and a construction decision by Placer Dome U.S.’s board) that NovaGold believes cannot be met by the contractual deadline of November 12, 2007.
It is the opinion of many that Barrick can not satisfy the requirements of their agreement with NovaGold to acquire a 70% interest in the Donlin Creek Project.
It has been said that Barrick’s expertise is not so much as mining people but more as political players. In understanding perspective, it is important to remember that Barrick was pounding gold lower near $250 an ounce some years back by selling 15 year out futures contracts.
The bottom line here was that Barrick was making quite a bit of money on shorting gold lower which thus forced excruciating pain on the gold producing companies that were doing their best to stay alive.
Do we forgive them for this? NO! We continue to watch them with a careful eye hoping that they don’t come dropping out of the the sky with their claws wide open in our direction.
NovaGold has the admiration of the gold community for standing up to this bird of prey and forked tongued gold consolidator.
Since Barrick Gold’s cash offer for NovaGold shares in late July, Bob Moriarty president of 321Gold Inc. and the Gold Anti-Trust Action Committee(GATA) have taken shots at Barrick’s offer. Today, Vince Borg Senior Vice President of Corporate Communications at Barrick fired back.
On August 7, 2006, Bob Moriarty wrote an article entitled, “Is Barrick trying to turn a Silk Purse into a Sow’s Ear.” Bob says that NovaGold holds a 70% interest in their Donlin Creek, Alaska property. Barrick owns the other 30% as the result of their merger with Placer Dome.
Barricks currently owns 30% with a 40% back-in clause right if certain conditions on the development of the property are met. They currently have not been met.
Barrick needs to do, according to Bob, hundreds of thousands of meters of drilling, detailed engineering to complete a bank feasibility study and getting construction permits so that their board of directors would approve the start of construction by early 2008. Bob goes on to say that there isn’t anyway in the world that Barrick will make their contractual timeline.
Bob says Barrick has done a good job of confusing the issue, they always count NovaGold’s ownership on their books as 30% of the Donlin Creek gold deposit. Currently there are 28 million ounces of gold blocked out. Barrick is now doing the drilling and isn’t sharing with anyone, including NovaGold, how many ounces of gold they know is in the ground so far.
NovaGold’s stock is now $17.20 a share far above the offered $14.50 per share by Barrick. Bob says that shareholders should be thinking $40 to $50 a share before giving away their stock. There is speculation around that there may be as many as 50 million ounces in the deposit.
GATA is taking the position that Barrick should cover their short obligations on about 12 million ounces of gold in the market as a condition before any price acceptance by NovaGold shareholders.
GATA feels that the outstanding short positions that orginally depressed gold prices should be covered in the market and the squaring off of those positions will return gold to a more realistic price. GATA says that Barrick’s shorting was a major suppressing force against the gold price and against the price of gold mining shares.
GATA notes that much of the increase in the price of gold in recent years has been attributed to the reduction of hedges, the closing of short positions, by gold producers.
Vince Borg of Barrick says GATA’s efforts to link the senior mining company’s unsolicited bid for NovaGold with Barrick’s hedgebook are “misleading” and based on an “errant set of suppositions.” Bill Murphy at GATA claimed that the major company “is desperate for the unhedged gold in the group at NovaGold, with which Barrick would extricate itself from a nightmare. Taking over NovaGold would help Barrick immensely.”
Borg said that Barrick Gold doesn’t need NovaGold to deal with its hedgebook.
Borg also said that Barrick has had a no hedge policy for the past three years. He also said that this year Barrick has been a net buyer of 7.5 million ounces to settle Placer Dome’s hedgebook.
Borg even said that some of GATA’s comments “are not based on any facts whatsoever” and strain GATA’s credibility with the investment community.
The vote goes to Bob Moriarty and Bill Murphy at GATA for supplying the public with the truth. The lap dogs from Barrick speak with fork tongues.
It’s not difficult to understand that Barrick is attempting to steal NovaGold at a deep discount with their current offer.
Gold is higher today at $623.90 and is up $12.00.
The media is reporting higher oil prices and growing inflation concerns as the main reasons for gold being higher. This is simply not true.
As mentioned previously, the commercial nickel short positions were being squeezed. Today, nickel is currently trading at $14.62 a pound vesus $13.90 on 8-17 and the shorts are having greater pain. Gold shorts take note!
In addition to liquidity problems growing for some members of the London Metal Market, currect available nickel supplies are running at an historical low. Current supplies in the LME warehouses are only good for one day of world demand.
In the media background, palladium is making an impressive move higher today from a price congestion area and with a last price of $342, up $12.00.
In the last few months it was copper and now it is nickel. It’s not the speculators causing higher prices as the media would like you to believe, it is industrial demand. China and India are the main driving forces of higher prices as their growing economies require more and more raw materials. Unfortunately for price stability, mine supply is lagging far behind demand.
It is just a matter of time before the next metal appears under the spotlight.
In the case of gold, there is a limit of how much metal can be borrowed and shorted. The day of destruction for the gold nay-sayers is closer than they think.
Gold is down $14.60 at $613.90 today.
The reason for this decline is more than likely a repeat scenario of the gold selling that indirectly originated from the Bank of England when copper broke above the $4 level and caused liquidity troubles for the commercial shorts on The London Metal Exchange.
This time around there is a brewing Exchange liquidity problem with nickel. The last sale on nickel is $13.90 a pound versus the low within the past year of $5.
On Monday the Wall Street Journal reported that POCSCO Co. Ltd. the world’s fifth largest steel marker is struggling to cover nickel short positions on the LME.
What this means for gold is that the gold shorts get extremely nervous when they see a short squeeze in another metal. Immediately they go into their master of illusion routine and sell the public some more of their deception by dumping borrowed gold or paper gold into the market.
The day is coming when all this orchestrated negative energy focused on gold will abruptly end with the gold shorts getting their heads handed to them. Mr. James Sinclair made the following comments today: “Today it is nickel but shortly it will be gold. You can take that to the bank by buying gold weakness.”
The FED and its various intemediaries, including the Exchange Stabilization Fund, continue to be in the market trying to destabilize gold’s price. This is for a good reason as a rising gold price is the report card showing financial mismanagement.
The media can report anything they want as a reason why gold went up or down on a daily basis or why it should mainly trend lower overhaul. As gold continues to move higher in this generational bull market it reflects a debasement of
wealth in general corporate assets. This is the reason why corporate America despises higher gold prices.It’s not a reach of imagination to grasp that corporate America runs the FED and the government. In corporate America’s push for profits, more and more money has to be created to grease its machiney to produce those profits.
As the result of severe foreign wage competition and the massive closure of production plants in the U.S. more and more money has been created in an effort to keep the economy on an even keel.
All this additional money is causing problems. Aside from one of the most oblvious, inflation, is a problem of growing government debt and the increasing obligation of paying higher and higher interest payments.
According to USA TODAY the total U.S. Governemnt debt is $49 trillion. USA TODAY reports, “Assuming this then it is very close to a time when interest on the U.S. debt will exceed domestic spending.”
All these financial promises equate to over half-million dollars for each and every household in the United States today.
There is no better time than than the present, if you have not already done so, to protect your wealth with the purchase of gold.
Your elected government officials will not, as a whole, convey the truth to you on certain matters.
As proof of this you are lied to about about inflation. The government figures concerning inflation are a widely known charade.
Another good example is the present administration claimed a $296 billion dollar federal deficit budget for 2005. The recent “audited” statement by the U.S. Treasury revealed a figure strikingly different, the deficit was actually $720 billion for that year.
Each time gold drops 10 or 15 or 20 dollars or whatever an ounce in a hurry you can be sure of one thing, the shell game is in play again. Don’t be a sucker and fall for their tricks but instead, understand how they work and use it to your advantage.
Quote of the day by Mr. James Sinclair of http://www.jsmineset.com:
“The more the madness of “might makes right” in wars and markets continues, the greater the the disaster when it reveals the king has no brains.”
Gold is trading at 609.10 this morning and is off 11.60 on the day.
Barrick Gold, an admitted agent for central bankers, is offering to purchase the assets of NovaGold for U.S. $1.29 billion.
Will the western central bankers someday resupply their depleted vaults by swooping down and grapping Barrick? It certainly beats buying gold in the open market and forcing it higher when you are short.
Gold is going much higher and Barrick’s continued buying strategy supports the idea that the central bankers know this, too.
Don’t fall prey to manipulated fast selloffs in the gold market but instead use these events, like Barrick has, to accumulate more gold.
Isn’t it odd, given both the pseudo-inflationary worries of the chest-puffed Fed and today’s robust reaction manifested in the Bull sector of a non-inflationary market, that gold vs. inflation isn’t antagonistic?
Or is it? Or not?
What I’ve been watching, with some very insightful analysis by this very forum, (thanks), is a disconnect from the tradition model.
Sparking some questions, I hope you chime in!
(Of course, finding gold on one’s own sets the tone for a secure position, given that other gremlins aren’t at play…)
Gold this morning is up $11.00 at 589.20. Last night in the Asian markets there was a little battle between the bulls and bears when gold went zigzagging between 579 and 582.
Seller’s failed to weaken gold coming into the N.Y. open and the the metal has unexpectedly moved higher ahead of the 2:15 PM Eastern announcement concerning an interest rate hike by the Fed.
It is a delight watching the shorts getting squeezed today. The action on gold so far bodes well for confirming that an important intermediate low has been established.
Gold’s last price is 579.70, down from the day’s high of 596.70.
A minor negative aura is seeping into gold and the gold stocks as a Fed decision on interest rates is approaching on Thursday.
Usually, when bully pulpit talk get released from the temple of the money changers gold and gold stocks get hammered.
Anticipating this event today the hedge funds saw an opportunity when gold approached the 600 level and sold into the group. Expect the intermediaries of the Fed to be called into action with their bearish market tactics Wednesday and Thursday.
The Fed’s efforts to push gold around only results in gold coming right back in their face. It’s like trying to sweep water into a corner. Sure, the Fed’s efforts to manipulate the gold price will work for a short period of time but the later reality will prove this only to be a futile exercise in wishful thinking when gold comes roaring back.
The current weakness should be seized as an opportunity to buy not sell as they expect you to do.
The 540 to 580 range on gold is a buyer’s area. Governments do a lot of foolish things, forcing gold lower is one of them.
The western central bankers are in for a big surprise.
When gold’s current price correction is over “the next major push on gold could be in the order of $1,542 or possibly even as high as $2,496.”
So says Alf Field in his editorial posted June 19th on kitco.com entitled Elliot Wave Gold Update VII.
Gold’s recent collapse was a rigged event.
Your recent paper losses in precious metal related stocks and precious metals was caused by western central bankers and their puppets hoping to scare you away from your holdings and to silence the positive headlines that gold was capturing with higher and higher prices.
If you want to read the real truth on how gold collapsed along with changing internal market dynamics there is available a superb editorial written by Mr. Dan Norcini on the http://www.jsmineset.com website entitled, “Remarkable Development In The Gold Market.”
The editorial was posted today, June 18th at 3:36 PM EST.
It’s an ugly day for believers in gold. Gold’s last sale is 567 which is off nearly $40 on the day.
This down move all started when Exchange members in London were spreading the short term copper market against the long term copper market and ran into financial trouble meeting Exchange liquidity requirements. Copper has had a spectacular move this year trading over $4. Today, it’s $2.9350 on the bid side.
The Bank of England thought by hopefully depressing the gold price this would drive base metals lower and save the failing member trade positions. What the BOE did was to lend out their last remaining physical gold to intermediaries for immediate sale to into the market.
Soon after, the FED decided to acknowledge increased inflation and publicly made statements that they were going to contain it by raising rates further. Concomitantly, other countries began speaking of rate increases to ward off inflation thus effecting the enthusiasm to acquire gold and the gold stocks.
All during these statements from central bankers the Exchange Stabilization Fund and their intermediaries started shorting gold and the gold stocks increasing the visibility that the central bankers were back in control.
Not too far behind were many of the 15,000 hedge funds that did’t want to miss any profitable rides to the downside and began in earnest selling gold and the gold related stocks. Great pressure was even put on Canadian gold related stocks in Canada.
The end result has been a fast snowballing effect that has put gold on a slippery slide disturbing almost all positive daily and weekly aspects of the precious metal related stock charts.
This concerted effort to halt gold’s advance was instituted for the reason that the hedge funds had pushed gold too high and the central bakers with their fiat currencies felt threatened.
There may be $7 trillion invested with hedge funds today. The funds have more financial might now to effect prices than the central bankers. What the hedge funds don’t have is an understanding of the small gold market in comparison to other much larger markets. The end result is that they move around like hungry elephants in a china shop.
Somewhere along in time the central bankers will be pressed big time when the hedge funds return following gold’s strength and propel it much higher than might be reasonably expected, again.
Whose gold will be used next time to hold the advance in check? What central banks still have physical gold instead of IOU’s? Knowing the central banks hatred for gold they will probably figure out a way to lend out these IOU’s and have them sold too.
Aside from the fundamentals that support gold to move to higher levels in time, the time will approach when all of the ammunition from the central banks and the funds will have been spent and the bull will march forward again to new heights.
The entry of the $7 trillion buying power of the hedge funds has brought with it unpresentented volatility to gold and its stocks. It is greatly amplified in the gold market because of its size. This is the sad truth that investors and followers of this market will have to cope with in the future. Expect the unexpected in price movements with a strong bias of trending higher.
Somewhere down the line the central bankers will choose to inject liquidity into the system as opposed to their current theme of constricting liquidity with talk of rising interest rates. Even if interest rates continue to rise these guys will always find indirect ways to inject liquidity into the system. As Richard Russell has always said, “Inflate or Die.”
Gold is entering the famous $540-$580 range that Barrick Gold covered a significant portion of their gold hedge book into following their merger with Placer Dome earlier in the year. Barrick Gold is the eyes and ears of the people who would prefer gold to remain low and tame. If they covered a large portion of their gold short position then this area in all probability is the floor on gold market today.
The following are a few comments from the brilliant Monty Guild of Malibu, California:
“Only the few will have the nerve to buy the dips(gold)”
“These who buy the dips(gold) end up very rich”
To view the fundamentals on why gold has to go to at least $1,650 visit http://www.jsmineset.com for an education by the master himself, Mr. James Sinclair.
Gold is currently trading in overseas markets tonight at 591.60. The media will be having a field day tomorrow reporting gold being under 600.
These low prices are being made available to you by the FED, the Exchange Stabilization Fund and the Bank of England.
Don’t miss this super sale!
Dear Bluejay,
I like the price, but is anyone mining gold at the 16:1?
Currently, there is an anomaly between some of the major gold producing stocks and the price of gold. Gold is off 10.30 at 633.20 while some of the major gold stocks are showing healthy gains.
The four stocks that are exhibiting unusual strength today are:
Agnico Eagle Mines – AEM-NYSE
Meridian Gold – MDG-NYSE
Newmont Mining – NEM-NYSE
Randgold Resources – GOLD-OTCWhat does the firmness in these stocks mean as opposed to gold being off over 10 dollars?
Usually, this type of contrary buying in the gold stocks means a bottom has either been made or is near. In overnight trading gold hit about 618.50 which is in the general vicinity of major support at the 620 level.
Gold continues to be confined within a declining trend channel area of between 645 and 595. If the 620 level holds the metal will break to the upside within 10 trading days and shoot for 682.
“You have to choose between tusting to the natural stability(enduring value) of gold.. and the honesty and intelligence of the members of the government. And with due respect to these gentlemen, I advise you to vote for gold.”
George Bernard Shaw
Two comments from Jim Sinclair today:
1- “The volatility coming in gold is going to make history.”
2– “My estimate of $1,650 being the high in gold is probably wrong. It will be higher.”
Just introduced myself to Dr. Peter Morici, author of an article in yesterday’s Sacramento Bee. He deserves compliments for bringing some fresh views into the gold market, views worth pondering. We will get his article under NEWS soon for you to evaluate.
Whether his words express facts or assumptions is less important in the overall theme: the Gold Standard. As a gold producer, I am usually an opponent of the gold standard. As one concerned with the future of America’s well being, I think it may have merit, at least talking about and refining with today’s economic realities. Dr. Morici writes: 1. Jewelry and industrial applications absorb 85% of new supply. 2. The big new players are exchange-traded funds. 3. Presidents Carter and Reagan put the American economy on the path of deregulation…..and made the dollar a better and more stable store of value than gold. 4. A dollar overvalued…has created huge U.S. trade deficits. China purchases more than $200 billion in foreign securities a year. 5. With so much of what the world consumes now coming from China and other Asian economies, the dollar will be worth a lot less to gold miners in South Africa or Russia.
Dr. Morici had never heard of America’s longest lasting and oldest U.S. gold company, which does not surprise me. He should, though, because following our history, our struggles and out potential is relevant. Original Sixteen to One Mine, Inc. has never lost its vision or ability to mine gold. At today’s prices or more, our success will be measured in share appreciation, gold dividends and the intangible so important to some, good will. When I first took accounting at UCSB in 1960, good will was an asset on the balance sheets to reckon with. I do not see it anymore. Why, when and how did it disappear?
Thought I would take a few minutes to comment on an AP Business article published Monday May 15, 2006 from New York and in the Sacramento Bee, sent to me by a shareholder. Madlen Read, writer, puts forth the following.
1. “Gold’s latest rise is the result of fear.”
2. “It’s a dangerous market because the fundamentals mean nothing.”
3. “Demand for gold has grown faster than supply.”
4. “Physical gold is an option. It’s not, however, the most practical vehicle for most people. There are costs to store and insure gold bullion, so it’s really only a good idea for those with a lot of money to invest.”
5.
Madlen, please do some critical thinking instead of repeating decade old opinions grounded in ignorance. You as well as most business journalists are well behind the curve of understanding how gold behaves and why. Most people, including myself, are very cautious when commenting about the under belly of the gold market. Its mystic has continued for 6000 years. Some opinions are just not true.Fear is not driving the rapid increase in price. Fundamentals are as important to understand, as are technical facts. Econ. 1A or 101 teach the basics of the relationship of supply and demand on prices, nothing newsworthy here. It costs nothing to store gold. It does not need to be insured because you can bury $25,000 worth or more in you indoor plants. It will be safe from fire or other accidental occurrences. If you do not brag about your stash, no one will steal it, which is one reason some people, companies or groups own gold. It is the most private and liquid asset in the world.
Reading ignoramus statements from the press concerning gold’s health is really disheartening for the reason that some readers are ignorant and don’t know the difference but desire to be correctly informed and thus get educated.
The following, “It’s a dangerous market because the fundamentals mean nothing” is plainly not a sensible statement from a writer at AP Business to make when their readers expect more.
The sad truth is that the writer doesn’t possess enough of a perspective concerning gold’s fundamentals to be writing about it. If the writer did, then the writer would have never made such an irresponsible comment.
All of the real fundamentals and how they apply to gold are objectively reported daily for no charge at http://www.jsmineset.com by Mr. James Sinclair with guest articles from two professional market men, Mr. Dan Norcini and Mr. Monty Guild.
You should really go to the site tonight as there is an enlightening story concerning the Bank of England(the guys who sold most of their country’s gold under $300 an ounce) and why they are orchestrating gold sales currently to help save the London Metals Exchange.
This is the final word for the time being:
The following are statements made by Mr. Jim Sinclair today on his website at http://www.jsmineset.com:
“Forget the why. The gold price is doing what it is not because of fundamentals, technicals or geopolitics. The price of gold is acting the way it is because the market wants 1650 and will do it when it wants, not when some advisors tell it to.
Reactions when they come will be more spectacular than the rise.”
Mr. Sinclair’s advice is to buy into reactions.
A news report by MarketWatch could explain the reason for gold’s strength recently.
“Moves by Venezuela and Bolivia to nationalize their countries’ natural resources could soon spill into the mining sector, likely boasting prices for metals that are already at multi-year or record highs, while pressuring companies with interests in Latin America.”
Value View Gold Report says “A great leftwing, socialist rising is occurring in Latin America, which will push higher all mineral prices.”
Ned Schmidt goes on to say, Venezuela and Bolivia are only the beginning.”
Indeed, early this month, Bolivian President Evo Morales said the move to nationalize the country’s hydrocarbons sector was just the beginning. “Tomorrow it will be the mines, the forest resources and the land”, he said.
“The greater concern is potential spillover to Peru” which is a major producer of gold and copper, said John Hill of Citigroup. Peru produced 207.8 metric tons of gold in 2005 or 8.2% of the world output.
The full story entitled “Gold markets eye Latin American moves” is available currently at Kitco.com
The deepest gold mine in the world is the Tau Tona owned by AngloGold Ashanti in South Africa. The mine workings extend 2.3 miles below surface.
In January of 2004 the U.S. dollar was about where it closed at today, .84 on the Index. In January of 2004 gold was at $400 an ounce. Today’s close in gold is over 75% higher than it was in 2004.
The last on gold is $708.10.
The price of gold is indicating that there is a serious problem that may be getting ready to surface.
The problem with the U.S. dollar is old news. Is the Iranian situation on the verge of exploding? Will there be company failures for those who have heavily shorted gold bullion. Has the FED been involved in selling gold and has it turned against them? Do we really have all the gold in Fort Knox and in federal reserve banks that they say we do? Something is wrong.
Gold is doing in days what it should have been doing in months, maybe weeks.
Gold has unexpectedly vaulted past big resistance at 682. Unfortunately, you can throw the charts out the window for the time being. Gold is a real animal now, growing stronger as it moves higher.
Another surprise, this time from Berkshire Hathaway.
Warren Buffett said at the Berkshire Hathaway annual meeting that he didn’t make any money on his silver investment because he “bought it very early” and said “he sold it very early. Other than that, everything I did was perfect.”
In 1998 Warren Buffett bought for Berkshire 129 million ounces of silver. The price paid was over $500 million and probably cost him about $3.90 an ounce.
Silver closed Friday at $13.90.
That’s $10 an ounce profit not realized. $10 times 129 million ounces of potential silver profit would have been $1,290,000,000.00. Now, that’s a real big mistake.Barrick Gold made a surprise announcement with their first quarter earnings report filed yesterday.
Barrick stated that their corporate gold sales contract positions(forward gold sales) have been reduced by a shocking 4.7 million ounces. As of 5-03-06 a total of 5.7 million ounces of forward gold sold have been squared away.
Barrick intends to reduce their hedged forward gold position by another 2.0 million ounces by year’s end. Barrick further stated that by the end of 2009 they will have eliminated their entire gold hedge program.
Barrick in the past has been accused of contributing to gold’s long bear market with their excessive forward gold sales. Gold ultimately bottomed out at just above $250 an ounce some years back.
An appropriate question is, why did these gold companies cover their gold hedge programs so late. I guess they don’t read our Forum pages.
Some years ago Mr. James Sinclair of http://www.jsmineset.com took out full page adds for all gold companies to read in mining trade paper’s and in Barron’s that gold was heading up and that gold hedge programs should be terminated.
Do you remember the story that, “you can lead a horse to water but you can’t make him drink”?
One only has to wonder why it took these guys so long to cover?
Included in Barricks buy back were the gold short positions incurred by Placer Dome which they recently acquired.
Placer’s loss for their share of the past forward gold sales in the quarter was $1.2 billion and in the time following the first quarter was $814 million. That’s a staggering $2 billion plus in losses for the Placer position alone.
Does anyone remember that some of the seed money to get American Barrick originally started came from Saudi Arabia?
Does anyone remember that George Bush senior was a board director at Barrick?
American Barrick was put in place to control the price of gold. It is obvious by their throwing in the towel that there is no stopping gold now.
Last on gold is $640. I know we’re in a bull market and I know it is healthy to react but this current move is very very impressive.
How about that gold price? The london fix is $624.75 today!
New Delhi, April 16, 2006
Press Trust of India reports from Assocham’s Paper on “Yellow Metal: its Future Pricing Trends” that“gold demand world over had reached at around 4,000 tonnes per annum against its supplies which remained stagnant at about 2,250 tonnes per annum.”
The last on gold is $599.60 after hitting $600.70 in the after hours trading market. The current trading range on gold is about $530 to about $610. The probabilities favor gold moving slightly higher followed by a selloff. This is all normal and to be expected.
Supporting gold’s recent strength has been the run-up in the price of silver. The last on silver is $12.72. Seven months ago silver was under $7.50 an ounce. Silver still possesses the ability to trade near $14 an ounce on a short term basis.
Most importantly for the gold and silver stocks is the fact that the Philadelphia Gold & Silver Mining Index is suffocating its shares at the 150 level on the chart. These stocks are weak and are currently laboring for strength just under this level. In the past 20 years the 150 area on the chart has ended all intermediate uptrends as they approached and traded partially through.
As gold, silver and their related shares appear temporarily inflated, this appears to be a suitable time to bank extra funds and await lower prices during this generational bull market in gold and silver.
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