"The fundamental argument in favor of gold remains intact" - Wealth Management

Incrementum-Erste Group report sets $1,480 12-month target en route to $2,300

We are firmly convinced that the fundamental argument in favor of gold remains intact.

There exists no back-test for the current era of finance. Never before have such enormous monetary policy experiments taken place on a global basis. If there was ever a time when monetary insurance was needed, it is today. ...

We believe gold should continue to be an integral part of investment portfolios. Gold is the only liquid investment asset that neither involves a liability nor a creditor relationship. It is the only international means of payment independent of governments, and has survived every war and national bankruptcy.

Its monetary importance, which has established and manifested itself in the course of the past several centuries, is in the process of being rediscovered. Contrary to 1979/1980, the current gold bull market will unlikely end due to a sudden strong rise in interest rates, as the balance sheets of governments, households and corporations are tainted by huge debt. In the current environment, this would lead to a deflationary depression. ...

From a technical perspective, we assume that the gold price is in along term consolidation phase since its all-time high in August 2011, similar to the mid cycle correction of 1974-1976.

Due to extremely negative sentiment, the clearly positive implications of the CoT data, and extremely oversold readings, we assume that a bottoming process will soon begin.

From a seasonal perspective, only very little momentum should be expected before August.

Regarding the sentiment backdrop, we see anything but euphoria in gold. Skepticism, fear and panic are never observable at the end of a long-term bull market.

We therefore assume that our long-term price target of $2,300 per ounce, already formulated several years ago, remains realistic. In the course of the price collapse, massive technical damage has been inflicted. We are therefore strongly convinced that repairing the chart picture is going to take some time. We regard the $1,480 level as the next 12-month target.

More information can be found online at http://www.goldbullionadvisors.com

Gold's long-term price target is $3,000 to $5,000 - Wealth Management

But bullion price could hit $1,000 in the short term, he cautions

"It's been a very difficult year for commodity markets but especially for gold and for silver, which had a really amazing performance over the past 10 years already," Superfund COO Johann Santer tells ET Now in a June 25 interview.

"It's not totally surprising as we have seen a shift also within asset classes going from commodities and especially gold and silver that are very liquid assets to more equity programs and also temporarily gold has been under a lot of pressure. Where do I see the next resistance lines? The next one obviously is at $1,200, which is just the next near-term line. But the very big one is going to be $1,000 an ounce, and the next one, one and a half years could still be very difficult for gold and silver, but in the long run, we strongly believe that gold and silver are really poised for a breakout as it's the only true currencies in our opinion out there in the market. ... We at Superfund, we have a target -- a long-term price target -- for the next five to 10 years where we could see even gold going up to $3,000 to $5,000 an ounce -- of course, a very aggressive one, but with all the stimulus that has been created, it would not be totally unexpected."

More information can be found online at http://www.goldbullionadvisors.com

Jim Cramer: "I really do like the gold coins," not the GLD - Wealth Management

TheStreet and CNBC star doesn't trust the major ETF anymore and hates mining stocks

"I still like gold coins; I think people should be in those," Jim Cramer tells Joe Deaux of TheStreet in a June 26 interview.

"Gold coins are integral. I shifted from GLD, which I don't trust anymore. I know that's kind of heretical. Your gold dealer would tell you not to trust it. I don't like gold stocks at all. They're toxic. Gold bullion, gold coins -- I want to use that decline for people to get in who don't own any gold. Why? I like it as insurance. And I'm willing to insure four-fifths of my portfolio with one-fifth of my portfolio. ... I don't like the gold stocks. I really do like the gold coins. I would like to diversify right now and buy more gold coins."

More information can be found online at http://www.goldbullionadvisors.com

"Simply put, the Fed is propping up the banking system" - Wealth Management

QE tapering depends on "rosy projections," ShadowStats' John Williams tells The Gold Report

All the hype over the Fed's so-called tapering is absolute nonsense. Fed chairman Ben Bernanke said the Fed's pulling back of quantitative easing was contingent on the economy recovering in line with the Fed's relatively rosy projections. He also indicated, however, that if the economy worsened, he would expand quantitative easing. When you consider that the official Fed projections are grossly optimistic, the conclusion is that we will have more, not less, bond buying from the government.
The jawboning was a multifaceted attempt to placate the Fed's critics, while soothing the stock and bond market jitters at the same time. The comments, however, hammered equities and bonds, as well as gold. The negative impact on gold likely would have been viewed as a positive result by the Fed.

The banking system nearly collapsed in 2008. The federal government and Federal Reserve took extraordinary measures to keep the financial system from imploding. Those actions prevented an immediate systemic collapse, but they did very little to resolve the underlying problems. I contend that we're still in recession, with the economy deepening into a renewed downturn. At the same time, the banking system solvency problems continue. Little has changed in the last five years.

The purported nature of the quantitative easing is a fraud on the public. While Bernanke describes the extraordinary accommodation in terms of trying to stimulate the economy, lowering the unemployment rate and attaining sustainable economic growth in the context of mild inflation, those factors are secondary concerns for the Fed. The U.S. central bank's primary function always has been to assure banking system solvency and liquidity. All the easing efforts have been aimed at the banking system. The flood of liquidity spiked the monetary base, but it has not flowed through to the money supply and ordinary people.

Simply put, the Fed is propping up the banking system. Bernanke is using the cover of a weak economy to do that because the concept is not politically popular, but it's what the Fed has to do because the underlying system is just as broken today as it was in 2008. 

More information can be found online at http://www.goldbullionadvisors.com

Gold to rise as capital flees bond market, says Paradigm Securities exec - Wealth Management

Rising yields are actually good for bullion, he tells CNBC

"At the end of the day I think that there is really good underlying demand for gold, and I think the supply of gold is relatively limited," Barry Dawes of Paradigm Securities tells CNBC in a June 24 interview.

In the 1970s and '80s "the gold price went up when interest rates went up, particularly the interest rates on bond yields. ... That to me is the key, and I think what we're seeing is a peaking out in bond prices, a bottoming in yields, and I think people will start to say, 'Look, there's a great supply of government bonds everywhere in the world and it's going to increase,' so I actually see the bond market as being a source of capital to go into the gold market."

More information can be found online at http://www.goldbullionadvisors.com

Faber: "As a contrarian, I would rather buy bonds and gold than equities" - Wealth Management

 "Maybe gold is signaling a deflationary collapse of all asset prices," warns contrarian economist

"Right now equities, bonds, and gold are very oversold," Marc Faber, publisher of the Gloom, Boom & Doom report, tells Bloomberg in a June 21 interview.

"In bonds and in gold, sentiment by historical standards is incredibly negative. In other words, as a contrarian, I would rather buy bonds and gold than equities. ... If you believe [Fed chief Ben Bernanke] means what he says, then you believe in Father Christmas. He said if the economy does not meet the expectations of the Fed in one year's time, they will consider additional measures. In other words, if the economy hasn't essentially fully recovered by mid-2014, more QE will be forthcoming. And as I said already three years ago, we're going to go with the Fed to QE99."

Faber later emailed MarketWatch with this warning: "Maybe gold is signaling a deflationary collapse of all asset prices. If this were indeed the case I suppose I would rather own gold than government bonds, high yield bonds and equities. If this scenario were to pass it would lead to even more money printing around the world."

More information can be found online at http://www.goldbullionadvisors.com

"Bull market in gold will resume in time," predicts Schroder manager - Wealth Management

"A new all-time high will be established" as bonds sell off

Gold's bull market is intact and prices will reach a new high as declines in bonds and equities boost demand and investors seek insurance against economic and political risk, according to Schroder Investment Management Ltd. ...

"The gold bull market is still intact," Christopher Wyke, a product manager for emerging-market debt, currencies and commodities at Schroder, said in an interview in London. "The fundamental reasons why people are buying gold are still there. We have economic risk, political and market risks, and gold will provide protection. Although the current correction may not have ended, we believe that the bull market in gold will resume in time and that a new all-time high will be established." ...

One of the effects of Bernanke's comments is the equity markets in many parts of the world will sell off," Wyke said June 20. "Bonds are selling off already, and there is risk of equities in some markets falling sharply as well. Going to gold as protection is going to become more important as markets are falling." ...

"If interest rates are going up, you don't want to hold bonds," Wyke said. "Most investors have far too much in bonds, and I think some of that money will go to gold." ...

"Historically, the dollar going down, inflation going up has been good for gold," Wyke said. "Even if those two things didn't happen, all the risks the world is facing mean that outlook for gold is good, and the fall in the gold price below $1,300 will provoke demand. People will be able to buy more."

More information can be found online at http://www.goldbullionadvisors.com

Buy gold bullion now because inflation will follow deflation - Wealth Managers

Sri-Kumar Global exec warns of "inflationary consequences of quantitative easing"

"Because of the deflation that we talked about, that pushes the gold bullion price down, and if we go down to $1,300, you've already gone ... from $1,921 all down to $1,300," Sri-Kumar Global Strategies President Komal Sri-Kumar tells Bloomberg in a June 18 interview.

"After that I expect the inflationary consequences of quantitative easing both here -- a pickup in inflation. The deflation may not last very long -- I expect it to be like a couple of months perhaps, and then the turnaround takes place, and that's when, when the deflation hits, that's when you expect to get out of bonds. ... Go into gold; go into commodities. ... I have been negative on commodities for a couple of years. It will change, and I'll become immensely enthused about all of these opportunities at that time. ... The most bullish thing that I see (with gold) is that you can get out of paper money, that it's an alternative to paper. And it becomes a store of your wealth in a form that you can protect yourself against inflation. The situation with interest rates rising as we have had in the last four to six weeks, that's not good for gold because you would rather take the money and put it into fixed-income and earn a slightly higher rate of return. But when interest rates go down and you have a deflationary phase, this is the time you say I'm going to be going more into gold in anticipating the turnaround."

More information can be found online at http://www.goldbullionadvisors.com

"We will see gold ignite in the second half of this year if not sooner" - Wealth Management

"Let's not be surprised if this thing turns on a dime," Tocqueville's John Hathaway tells King World News

We will see gold ignite in the second half of this year if not sooner. The bigger picture is that we are at crunch time for this notion that QE is benign and that the Fed and other central banks will be able to tweak it so expertly. The whole idea of tapering makes me laugh because all it means is that the rate of increase will slow somewhat, which I think is also a myth.

But I firmly believe we are reaching the point at which this notion that the central banks have everything under control, that the economies of the world are on the mend, and that the bond market will tolerate the withdrawal of liquidity in a very sanguine way, I think all of this is going to be severely challenged as we go into the second half of this year. I believe it will boil down to a loss of confidence in the policies which have been in place since the credit meltdown of 2008. ...

It could be a grind in gold for a bit more time as rallies will be met with (paper) supply from people who still want to get out. That's one scenario. I suppose for those of us who are committed to this view and to this strategy, I would be prepared for a grind.

But on the other hand, let's not be surprised if this thing turns on a dime. That's why when I read all of this technical stuff I firmly believe that it's a big mistake to make investment decisions based on that. Trying to market time an event which is 'transformational' in the capital markets, and almost inherently unpredictable on a timing basis, means to me that technical analysis is really not the way to view things. ...

The bottom line, and my message, is that investors have to be positioned, despite the pain, in order to capture the repricing of gold, which could be very, very sudden. And I'm not talking about $100. I'm talking about another $1,000 on the upside.

More information can be found online at http://www.goldbullionadvisors.com

April gold plunge "ended with retail investors stampeding to buy" - Wealth Managers

The only thing that changed over the past 60 days was the price of gold, and perhaps the mainstream's perception of our industry. The realities of the fiscal and monetary state of the world, however, did not.

What has struck our industry was not the consequence of a shift in fundamentals, but rather a number of transient factors, including: (i) growing belief in the general investment community that inflation will not result from global money-printing efforts; (ii) claims the global economy is improving; (iii) Europeans fleeing their economic troubles buying US dollars (which makes the dollar look strong and hence gold less appealing to some); and (iv) a very large gold sale that caused the gold price to breach "technical support levels" and trigger a cascade of further selling. All of this -- and a lot of commentary based more on opinion than fact -- has led to the misguided conclusion that gold is a has-been asset. ...

Today's ongoing economic and fiscal crises cannot end smoothly or without unpleasant consequences. Since none of the excesses that precipitated the 2008 financial crisis have been fixed, another round of crisis is baked in the cake and will likely inflict even greater damage. When that happens, gold will again be seen as the refuge it is, regardless of current popular opinion.

We're not alone in this thinking. As you've undoubtedly read, in response to the crash, global demand for physical metal soared at both the retail and wholesale levels. This reaction is extremely important: we can't identify a single crash, collapse, or crisis that ended with retail investors stampeding to buy the asset that had just been crushed. Not one. In our view, the gold story is not over. Far from it. The reasons for owning it are just as important now as they've ever been since the bull market started in 2001. I can't be sure the price is done falling -- but I'm sure it's not done climbing.

More information can be found online at http://www.goldbullionadvisors.com

Bank of America on gold: "We still have got a target of $2,000" - Wealth Management

"We pushed that back by a few quarters," analyst tells CNBC

"We still have got a gold target of $2,000 per ounce, but we pushed that back by a few quarters," BofA Merrill Lynch Global Research strategist Michael Widmer tells CNBC in a June 13 interview.

"The reason why we did that we see not necessarily the buying interest from investors at the moment. ... What we're saying in that note, though, is if you're looking out over the next three or four years, emerging markets are getting more affluent over that time, and as they get more affluent, they can increase jewelry demand and that will increasingly drive the market. ... It is a break, a pause in the gold market, and over the medium term I don't think the gold market has been broken yet."

More information can be found online at http://www.goldbullionadvisors.com

Many investors would "rather own a gold brick than an ETF" - Wealth Management

New Deutsche Bank warehouse in Singapore shows preference for physical bullion, especially in Asia

"If you look at the existing primary locations of London, Zurich and New York, these are clearly Western-centric," Mark Smallwood, head of APAC wealth planning at Deutsche Asset &Wealth Management, said Wednesday of the bank's new gold storage warehouse in Singapore. "The launch is really part of the story of Singapore, and about a story of evolving storage facilities for gold bullion" ...

"Asian investors are very gold-centric and the reason for it as we have seen had to be put in the context of where the gold price has gone in the last 10 or 12 years," Smallwood said, adding that the price of gold moved from around $250 an ounce in 2002 to peak at the $1,900 mark and is now down to the $1,377 level.

The recent rout in gold prices has resulted in a shift in the way people want to own gold in the market, said Tom Price, global commodity analyst at UBS.

"The opening of a warehouse for gold shows a shift in the market in the last few months, where people have some concerns over ETFs and they'd rather own a gold brick than an ETF," Price said.

More information can be found online at http://www.goldbullionadvisors.com

2 more gold advocates rebut Nouriel Roubini's bearish bullion forecast - Wealth Management

New York University professor and financial-media darling Nouriel Roubini recently issued a bearish call on gold, predicting it would fall to $1,000 by 2015. We've already presented the rebuttal of contrarian economist Marc Faber, who said: "I wouldn't use him now for giving me advice for when to buy and when to sell shares, nor when to buy gold nor when to sell gold." New critics of Roubini's forecast have been coming out of the woodwork, and two of the latest areJ.S. Kim of SmartKnowledgeU and Michael "Mish" Shedlock.

From J.S. Kim: On December 15, 2009, when gold was trading at $1122 per troy ounce, Nouriel Roubini stated, "Since gold has no intrinsic value ... there are significant risks of a downward correction rather than a rapid rise towards $2,000, as today's gold bugs claim" and gold "looks suspiciously like a bubble." A 35% drop after a bubble bursting is a reasonable fall for "bubble" talk, which would have sent gold into the low $700s per ounce. A month earlier, Roubini had declared, "gold at $1,500 is utter nonsense." So how did gold perform after Roubini hawked his "gold is a bubble" message all over the news? Not only did it never retreat back to $700 after Roubini ranted against gold, but it never retreated back to $800 or even $900, and in fact it soared to above $1,900 an ounce less than two years higher, a 69% surge higher that not only crushed Roubini's "gold at $1,500 is utter nonsense" declaration, but made Roubini's prediction of gold's future price behavior utterly wrong by more than 100%.

After Roubini was so ridiculously wrong and seasoned gold advocates were right back then, one would think Roubini would think twice about opening his mouth again when making predictions about gold. But nope. He's back at it again, as his only purpose in the media and in the institutional educational system seems to be to serve as a shill for the banking elite. This week Roubini claimed that gold would retreat back below $1,000 once again, just as he did four years ago and the reasons he provides are as illogical now as they were back then, including sophomoric ad hominem attacks against gold bugs that lack any factual support whatsoever. One would think that if the media were to grant someone that made such a horrendously wrong prediction about gold just a few years ago the spotlight again, that they would discuss his past erroneous predictions to provide some context to his present predictions.
And Mish Shedlock noted: I just finished reading Nouriel Roubini's seven point analysis on the Bursting of the Gold Bubble in which Roubini's asks and answer the question "Gold skyrocketed to over $1,900 per ounce in the fall of 2011 from $800 in early 2009, but has since collapsed by around 27%. Why?"

I offer a point-by-point rebuttal. ...

Things Roubini is Wrong About
*    Gold
*    Tail Risk
*    Benefits of monetary printing
*    Benefits of fiscal stimulus
*    On what causes economic growth
*    Inflation
*    Stock market risk

More information can be found online at http://www.goldbullionadvisors.com

Gold disclaimer on Comex report raises new questions about bullion supplies - Wealth Management

From Jesse's Cafe Americain: This is from the report that shows the amount of gold and silver said to be available at the Comex.

"The information in this report is taken from sources believed to be reliable; however, the Commodity Exchange, Inc. disclaims all liability whatsoever with regard to its accuracy or completeness. This report is produced for information purposes only."

So much for even any pretext of audits and inventory controls. Just numbers on a piece of paper when push comes to shove. 

One can only wonder why the Exchange felt the need to add this statement now, after all these years. Especially when Comex eligible gold inventory levels are approaching record lows, and there is widespread mistrust of certain parties and their opaque market positions on this list.

And there are rumours of forced cash settlements in lieu of bullion delivery floating around. The Hong Kong Metals Exchange just folded, and forced cash settlements. And banks are cancelling physical delivery arrangements.

How can someone who is trading metals and storing them at the warehouse not be concerned about a declaration of force majeure without liability recourse? What is the purpose of a commodities exchange when there are no representations made that they even possess what one is trading?

And from Dave Kranzler of the Golden Truth blog: 

How would you like to get your bank statement in the mail from JP Morgan or Bank of America and see this disclaimer added at the bottom:

"The information in this account statement is taken from sources believed to be reliable; however, JP Morgan Chase & Co. disclaims all liability whatsoever with regard to its accuracy or completeness. This account statement is produced for information purposes only." ...

The common reaction would be to ask "why now?" But we already know the answer to that question. I've suspected for a long time that the Comex vault operators lease out a substantial portion of the gold and silver bars that they keep in both the "registered" and "eligible" account designations. It would be easy income for JP Morgan, a bullion bank who actively engages in gold leasing, to lease out the majority of the bars it stores for delivery -- "registered" -- and for investors who have taken delivery but keep their gold/silver in JPM's Comex vault -- "eligible." After all, in any given delivery month, less than 1-2% of the open interest ever stand for delivery, making it very easy for a Comex vault operator to earn extra income by leasing out gold and silver that it knows it will never be required to produce for delivery.

More information can be found online at http://www.goldbullionadvisors.com

"We're selling the dollar, we're buying gold," Merk exec says - Wealth Management

"There is no exit in sight" from the Fed's quantitative easing, argues Axel Merk

"What the folks at the Fed see are that the markets are frothy, that equity prices are high, and saying, 'Wait a second. We've got to one day prepare these folks for one day we'll exit,' but if you look at what the Fed is watching, inflation numbers are down, manufacturing numbers are down, folks are pushing folks to part-time jobs because they don't want to pay for Obamacare," Merk Investments CIO Axel Merk tells Fox Business in a June 3 interview.

"This is no recovery where you want to mop up liquidity if you're the Fed. And so at this stage, the only thing they do is talk. And then you heard it: They might even consider increasing the purchases. They just want to talk, get the markets ready for what may come down. The important thing, though, is the market is pricing in an exit, and there is no exit in sight, and so the market has gotten ahead of itself. ... We cannot afford higher interest rates. Think about what happens to the sustainability of government debts. We cannot afford to pay higher interest rates. ... We think that the euro is cheap, the dollar is expensive, and gold -- as you see today -- gold is doing quite well because our manufacturing numbers are not good. And so with that I think there's a lot of wish belief by the Fed, by many in the markets -- it's not going to materialize in a Goldilocks scenario, so we're selling the dollar, we're buying gold, and we're also buying the euro."

More information can be found online at http://www.goldbullionadvisors.com

"Gold will respond" if money printing continues without reforms - Wealth Management

"These require strong and decisive political thinking that translates into direct action," says Brian Pretty of Contrary Investor

Financial markets are not driven by a consistent and unchanging set of factors over time. Investor focal points change. For now the key focal point upholding investor confidence is the unprecedented magnitude with which global central banks are printing money, accompanied by promises to do more. But the core issues mentioned above have not magically disappeared. It's in the reality of structural reforms where the real economic rubber meets the road. For now, global central bankers are being given "the benefit of the doubt" that all will end well. The thinking is that nothing can go wrong as long as money printing is in force. But for gold, that's only half the equation.

We all know money cannot be printed indefinitely (especially in the magnitudes we see today) without adverse consequences to both financial markets and real economies. The real risk ahead is that reforms addressing debt, deficits, entitlements, currency infrastructure, and systemic risks will never occur. These require strong and decisive political thinking that translates into direct action. That's where the real risk comes into play.

IF unprecedented money printing is not accompanied by successful and sustainable economic reform in the major developed economies over the next 12-18 months, gold will respond. That's the investment thesis for gold as we look over the next few years.

How far could the price of gold fall before the current correction reverses? As always, it's anyone's guess and depends heavily on supply and demand balances. Although global demand for physical gold has remained incredibly strong, it's the paper markets where we see the weakness. Gold near 1100 is not out of the question before this correction ends. But given the politically tenuous prospect for global economic reforms accompanying monetary policy across the planet, we may be looking at the final third of the secular gold bull market perhaps beginning sometime later this year or into 2014. The central bankers and politicians have so far inspired short-term confidence in the financial asset markets. It's now up to these politicians and central bankers to address the tough reform issues. If they do not, gold will have a purpose.

More information can be found online at http://www.goldbullionadvisors.com