Thursday, August 9, 2012

RANGEBOUND!!!

BASSMASTER
Most advanced gold traders seem convinced that gold is in a range and destined to be held there....at least for another month or two........maybe even until next year before any meaningful up move in gold or the miners. The "smart" trader just doesn't see the upside here. There is no interest in being loaded in PM equities at this stage. Hedge funds aren't even the least bit interested in the sector and NO ONE owns bullion. Do your own survey. The argument for the long term investment in gold is gaining traction in many circles, but seemingly no one is recommending getting in now. Most sentiment indicators remain at historic lows for the PM equities. Even with Europe on the edge of the abyss gold cannot gain any traction as the counter trend dollar rally continues. Alas the yellow metal remains the unwanted red headed step child of the investment community right now even though it has been the best performer of all asset classes over the last 10 years. The mainstream media pundits and reporters continue a daily assault on the value of gold as a "safe asset" play. It has become a "risk on" investment. That is NOT what gold is, but that is exactly what someone has tried to paint it as. These developments all have a purpose and that purpose is designed to keep you out of the trade. I certainly cannot blame anyone for losing confidence in the precious metals, but from the cheap seats here it looks exactly like you would expect any rigged market to treat an asset or equity sector that they wanted to own and that they wanted YOU out of. It works and it will continue to work until they decide its time to change the game and rip this sector higher. Once the volatility starts you can expect some breath-taking shakeouts, so be prepared for a violent ride. Of course another great way to keep you out are such extreme up moves that only the most resolute of you will still be holding your position and not taking early profits just to get out of a decimated trade. After all...a better time and a better entry is going to be waiting for you down the road. In hindsight it will look amazingly deceitful and cunning......that is the game. Maybe later will be the time to be "loaded" in this trade........maybe......But my best guess is the least number of retail traders possible will be allowed to load.......whatever their move is..... gl

Today Egon von Greyerz told King World News, “Wealth has never been created by printing money, and this time, like it has before, it will lead to a financial crash.”  Greyerz, who is founder and managing partner at Matterhorn Asset Management out of Switzerland, also said, “This time the financial crash will be of a worldwide magnitude.”  

Here is what Greyerz had to say:  “The die is already cast for the world’s current situation.  It was cast many years ago and it is irreversible.  This is exactly why investors need to take a look at the big picture and protect their wealth.  But focusing on the short-term for a moment, markets look poised for a big move over the next few months here.”
“This move will include gold, silver and the HUI.  The fact that this move is in front of us simply means that more money printing is on the way at any time in the next few weeks.  I also expect global stock markets to top later this year, and then they should go through a precipitous decline.

We should note that right now Japan has the biggest debt to GDP of any country, over 200%....“The demographic situation in Japan is also a disaster.  But if the interest rates in Japan simply went from 1% to 2%, that will literally use up all of the tax revenues.  That is just incredible.  

So there is a hyperinflationary disaster looming in Japan, that’s absolutely guaranteed.  I wanted to stress Japan because very few people focus on that, but it is yet another country adding to the many other existing risks in the world.  

But even when you look at the US, with $15 trillion in debt, and roughly $1.5 trillion in tax revenues, it’s an enormous disaster waiting to happen.  At 10% interest rates the US will use 100% of its tax revenues to finance the debt.  So we will see many countries that will not even collect enough tax revenues to pay for the interest expense on their debt.

This is why money printing is guaranteed in Europe, the US, UK and Japan.  History teaches us that a nation which runs large deficits and increasing debts could never create wealth in the long-run.  Wealth has never been created by printing money, and this time, like it has before, it will lead to a financial crash.

This time the financial crash will be of a worldwide magnitude.”  

Greyerz also added: “Gold’s rise has reflected some of the money printing up to now, it’s up 150% in dollar terms over the last five years.  Over ten years gold is up 450%.  This is because of the destruction of paper money, which will only accelerate over time.

But gold has risen with only slightly more than 1% of the world’s assets in gold.  Right now the world’s assets are about $150 trillion.  Of that number, $60 trillion is in cash, $40 trillion is in bonds, and $40 trillion is in stocks.  But, remarkably, only $2 trillion or just a bit over 1% is in gold.

With inflation headed higher, institutions, which have virtually no allocation to gold today, they will have to increase their allocation to gold.  There have been several studies over the last few months that have suggested that institutions will need to put part of their funds in gold.

If you look at world financial assets, a 1% increase in allocation to gold of the world’s financial assets would require 12 years of gold production at today’s prices.  There simply isn’t the gold available at today’s prices to facilitate even a small move by institutional money into the sector.  Of course they can never get a sizable commitment into gold at these prices.

I would also add that over time they will put a lot more than 1% into gold.  The studies I reference also suggest that institutions will improve their risk vs return situation by moving money into gold.  So I am convinced that there will be a big inflow of institutional money into gold over the next two or three years.”







25 comments:

  1. http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/8/10_We_Are_Now_Seeing_Huge_Orders_For_Physical_Gold_%26_Silver.html

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  2. According to the Survey of Income and Program Participation conducted by the U.S. Census, well over 100 million Americans are enrolled in at least one welfare program run by the federal government. Many are enrolled in more than one. That is about a third of the entire population of the country.

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  3. Claude Resources CGR has been a pig....but it still remains a big holding of mine it has been just destroyed by the game its basically on concerns about stagnant production and rising costs at the Seabee Mine in Saskatchewan. Meanwhile, management has gone about it's business expanding the mill, deepening the shaft, and drilling up new, higher grade ounces. All of this should mean rising production and lower costs going forward. The other big thing is the Madsen Project, near Red Lake. This former producer has the permits and the infrastructure to be a quick and cheap start up anytime that Claude wants to pull the trigger. For now they are continuing to drill, in order to really start it up with good size.

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  4. Oops.

    Once in a while, the rigged system shows it's hand....

    "Jobless Claims Data Posted a Day Early"

    http://www.cnbc.com/id/48600271

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  5. gold being carefully brought up into the next range to 1640

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  6. Re: the bank story. The conspiracy theorist in me wants to know why has this story gone public? Personally, I think they will finally break up the banks, privatizing the "good" parts and nationalizing (for us lucky citizen/taxpayers) the "bad" parts.

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    Replies
    1. that has been the M.O. and should not change......gonna take a crisis situation to intiate...so we will have warning......maybe......remember....the maybe is just that.....you could wake up one morning and everything has changed and reset.......see below

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  7. careful......A-10s are practicing their bombing runs overhead heavy today.......may be an indicator that something is afoot...end of the olymics may open up Iranian hostilities

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  8. http://www.silverseek.com/article/silver%E2%80%99s-move-above-its-50-day-moving-average-bona-fide-buy-signal

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  9. SVM has been rising and if it stays green today, it will be the 5th green candle in a row.

    I'm watching RWM too, hoping for an end of the day rally so it is cheaper.

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  10. PZG just took off! I cannot find a reason why?

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    Replies
    1. algos gone wild? heheehe.......probably saw some weak shorts to squeeze.....they'll come back

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  11. there's your end of the day pump doc

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  12. Yeah, I bought some around 3:45pm at 26.33.
    I was certainly hoping for a much more robust pump job. They just can't make it easy now, can they?
    I wanted to have a bit of a hedge going into the weekend.

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  13. Is it just me (probably) or does the entire market this week seem like each day has been just more surreal than the previous.....its like the calm before the storm.....anyone else notice it

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  14. here ya go....just came up

    http://www.zerohedge.com/news/former-defense-secretary-says-us-will-probably-enforce-no-fly-zone-take-aggressive-action-over-

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  15. hey all....what are your thought on 401K's

    sit tight or pull it...

    also what do I do with a few(some) 1000 bricks(bars) of silver

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  16. sit tight on the bullion.....as far as 401Ks go you know very well all aspects of the paper system are at risk.....My guess is that many will start closing 401Ks for survival/necessity.....others will decide there is too much risk and close them down taking the pain. An accountant can give you advice on "self directed" 401Ks and the options....I recently dissolved my corporation and rolled it into an SEP......this will allow more options and because of my age it gives me a timeline for taking it out and into "hard assets" this should be a goal. keeping some money in these vehicles for the optimist in you and removing some for the realist in you

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    1. BTW Paladin.....the 401Ks and SEPs scare the chit out of me and I am sure that will eventually be their unravelling......the loss of confidence......and then they will be converted

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  17. Ann Barnhardt site is takling about this.

    http://barnhardt.biz/

    RED ALERT: It's Open Season on All Customer Funds

    down the page of the site..
    The 401k Confiscation: The Ghilarducci Plan Part 1

    The 401k Confiscation: The Ghilarducci Plan Part 2
    and this...

    On 401ks.....down the page

    the 10% up front is not the problem......that I have to add the money to this year pay moving me to a higher tax level...

    I know they will do this....

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    1. that's one of the reasons this site is still open to discuss these issues paladin......and I hope Ann is wrong but i fear she could be right......there are a number of ways that 401Ks can be threatened........gl to you and others in this situation. I love Ann's courage......unfortunately she could help re establish a theocracy in place of our current system...........and that is even worse than a NWO IMO.........but she has the courage to speak out and I hope she keeps on

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  18. you may ask how did you buy 1000 oz bars

    it is a strange story

    it was back in the day....silver was trying to brake out of the 5$ oz range..

    so I walk into my dealer shop.......silver was 3$ over spot...on Maples....I was so pissed off ...
    I started to walk out...then I asked what was the best deal of the day on silver.....they said 1$ over spot....1000oz bars

    and that is the key.....how you ask..

    if you walk in and ask for the price on eagles....you get the price over spot..

    the key is to ask for the best price of the day...you may get 1oz bars...you may get coins..

    you may get Kugs at 5$ over spot

    hope this helps....paladin

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  19. Made my 2012 withdrawal from the IRA last Wed. Been doing it for last 3 years to minimize tax effect. Monday, that money is going to Tulving. It is a tough decision in that 40% comes right off the top, but it is better than what is likely coming. I'm currently 53 and suspect that they will take action adverse to my IRA interests before I could take it out with no penalty.

    As the guy mentioned in the first video above, the 401k money is locked up unless you no longer have the same employer - at least that is true in my case.

    Good luck. jd.

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