Wednesday, February 27, 2013

Gold sales went "insane" on price dip, Coin Week tells Fox Business - Wealth Management


"The United States government sells the American gold Eagle and they release monthly numbers," David Lisot of Coin Week tells Fox Business in a Feb. 26 interview.

"The numbers dropped off in the sales in December, which is typical during the holidays. January they were up over a 150,000 ounces. February's only halfway though -- they have over 60,000 ounces sold so far.

"And I have to admit: Last week when the price of gold dropped and I heard some of the analysts on some of the financial stations saying that gold has seen its day and the market had turned, I admit I was a bit amused, because the price of gold, when it's affected in the short term like that, is affected by the commodities prices. The actual buying and selling where people are physically taking physical possession of it takes place through coin stores and retailers of gold coins. When I talk to the traders in the rooms selling those when gold had dropped, they said it was like a madhouse, it was insane. People were buying more coins, more physical gold during the drop in gold because it represents a buying opportunity. ...

"All around the world the physical possession of gold from the different countries is at least equal or consistent with what it has been. ... $1,550 is the support line, that is the one that traders look at that has been tested three, four, five times. ... $1,550 is pretty much the bottom that is looked at. Just look at ourselves today waiting for the news of what the money supply is going to do. The countries of the world and the individuals of the world look at gold as a protection. It is an asset that is nonperforming. They put it away. You bury it in the back yard or you stick it in your bank vaults. It is the commodity that allows you protection in a time of economic uncertainty."



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

Tuesday, February 26, 2013

"Major gold rally" coming in 3rd quarter, UBS predicts - Wealth Management

 The conclusion from UBS? As analyst Julien Garren explains in a note, the role the U.S. economy plays in influencing commodity prices is a delicate dance, but providing investors can be patient, it's a winner for gold. Part of the selloff for gold (BAML's technical analysis team sees gold's "longer-term upside potential into the $2,100-2,300 to $3,000 range") thinks the sentiment reading is a positive sign.

In a note to clients, he writes:

While gold has taken a significant hit as of late, it remains above the pivotal 1,522/1,533 17m range lows. Against here the larger bull trend remains intact. Note that sentiment has now reached its LOWEST LEVELS SINCE 2008. From the perspective of contrarian opinion analysis, a bottom and bullish turn in gold is close at hand.

The sentiment indicator BAML tracks seems consistent with the latest CFTC data, which revealed that fund managers have placed their biggest bets against gold since at least June 2006.


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

Monday, February 25, 2013

Five Reasons to Own Gold Bullion - Wealth Management

1. The US Dollar loses purchasing power every year. Since 1971 the USD has lost 82% of its value while an ounce of gold bullion, when converted to USD, will purchase as much as or more than it would purchase in 1971. Is there any reason to expect anything different in the next 40 years?

2. Gold bullion is recognized as having value in every country in the world and as such can be converted to the paper currency of any country. Ounces of gold bullion really are liquid assets around the globe.

3. Gold bullion cannot be mass produced by any person or organization, including governments, so its value cannot possibly be diluted by an over supply.

4. You cannot convert Gold ETF shares to physical gold bullion. You purchase Gold ETF shares with paper dollars and you sell Gold ETF shares for paper dollars. In short, the only way out of a Gold ETF is via paper money. You are not diversifying away from paper assets when you invest in a Gold ETF nor do you own gold bullion when you invest in a Gold ETF.

5. You, your family and future generations will never be poor if you own gold bullion and pass it on as part of your legacy. All paper assets eventually become worthless or are replaced by other paper assets that eventually become worthless. Among all of the physical assets, none have the long lasting physical durability of gold bullion. Gold bullion is virtually indestructible and does not deteriorate with age. A one ounce gold coin from the Roman empire still weighs one ounce today.


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

Friday, February 22, 2013

Huge hedge fund places $240 million bet on gold and silver in 4th-quarter 2012 - Wealth Management

While the mainstream media continues to spew out bearish news and headlines on precious metals and (especially) mining shares, SAC Capital Partners LP, a $20 billion dollar group of hedge funds founded by Stephen A. Cohen, quietly positioned itself in over $240 million dollars worth of gold, silver, and mining share investments during Q4 2012.

Of great interest is the structure of those positions. They are indicating, that the firm is expecting a massive spike in both gold and silver, as well as a staggering move higher in the mining shares. ...

Bottom Line: While some funds may be experiencing redemptions and forced selling of metals and mining shares, this firm is taking monstrously large positions -- many of them being in call options--with the expectation of staggering moves higher in the months and years ahead.


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

Unlike gold, "we have no record of a stock market that's gone up 12 straight years" - Wealth Management Feb

From his office in Chicago, Donald Coxe heads up the Global Commodity Strategy investment management team, a collaboration of Coxe Advisors and BMO Global Asset Management:

The Gold Report: Are you saying that there's a perception that gold has reached a price ceiling?
Don Coxe: People are wondering where the next price floor is, which is a different type of concern. When gold was moving up, the debate was about how high it might go. Now investors are afraid that gold will collapse. Investors who believed that gold was doomed to collapse back in 2005, 2006 and 2007 were totally destroyed because gold soared to new, all-time peaks. Is gold an animal that has to keep growing or die? I don't believe that, but we have no record of a stock market that's gone up 12 straight years. And if a stock market that had gone up for 12 straight years sagged back by 15%, would it be reasonable to believe that equities are bad investments and we should all move into Treasury bonds? 

The Gold Report: Typically, gold was treated as a hedge against inflation and uncertainty. Is it still reasonable to look at it as a hedge?
Don Coxe: It's a hedge against inflation for reasons that in the past we were told were inevitable, but which have not yet happened. You would think that a person who drinks a fifth of whiskey a day and smokes three packs of cigarettes a day is not going to live as long as a normal person. But, suddenly, he is blowing out the candles on his 75 birthday cake. And you say, "This is not medically possible!" It is beating the odds, but at some point, it is going to catch up with the smoker. There simply is no record of huge expansions of the monetary base, huge expansions of government deficits, the inability of politicians to manage and the inability of economies to grow fast and mop it up that don't lead to inflation. 

The supply of money relative to the total GDP is now the greatest in human history, and it keeps expanding relative to our actual output. This will lead to inflation. Will it be next year? In five years? Who knows? If you hand out free tickets to a rock concert, you may not drive down the price of the best seats, but if fans believe more than half the seats will be given away at the door, you can bet the promoters will have trouble selling tickets. And that's eventually what's going to happen to paper money.


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

Thursday, February 21, 2013

"Gold Bullion prices have historically held up fairly well" after death crosses - Wealth Management

The bearish technical chart formation known as the "death cross," in which an asset's 50-day moving average falls below its 200-day moving average, is not the coffin nail for the gold bull market that so many bullion skeptics are trumpeting. That's the conclusion of Wall Street Journal writer Steven Russolillo in his piece titled "Gold's Death Cross May Not Be So Bearish":

Ryan Detrick, senior technical strategist at Schaeffer's Investment Research, points out gold prices have historically held up fairly well after the notoriously bearish formation takes place. 

Gold has averaged short-term gains up to six months following the 22 death crosses that have taken place since 1972, Detrick says. The 1.3% one-month average gain for gold following a death cross is better than the 0.9% average increase for the precious metal during any given one-month period.

Throughout two-, three- and six-month time frames, gold gains following death crosses have slightly underperformed their typical returns. The biggest divergence has taken place over a six-month time horizon, when gold has averaged a 3.2% increase following death crosses, compared to a 5.7% average gain. ...

What's more, gold has historically had a more negative reaction to so-called "golden crosses," an opposite pattern that occurs when a 50-day moving average breaks above the 200-day moving average.


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

Wednesday, February 20, 2013

Forget the death cross -- gold bullion is a buy, Pento chief says - Wealth Management

Rates are rising, and lawmakers are brawling over budget cuts. Fear is in retreat, and gold is getting kicked to the curb. Even the chartists are piling on the precious metal today, noting the occurrence of gold's first death cross in over a year, as the spot price dips below $1,600 an ounce. As ominous as all of this seems, at least one gold bug says he is undeterred.

"I'm a fundamental guy. I care nothing about golden crosses or death crosses or anything of the kind," says Michael Pento, founder and president of Pento Portfolio Strategies. While he currently holds about 15% of his portfolio in gold and admits he's "not happy," he's confident his bullish call will vindicate him in the near future.

"The central bank has adopted an inflation target, and I believe Mr. Bernanke will hit that target -- and exceed it," Pento adds.

Some readers will surely protest that inflation fears, while rampant, have yet to materialize. However, Pento says a combination of growing money supply, a mushrooming balance sheet at the Fed, our burgeoning Federal debt and deficit, a devalued dollar and global central bank demand for gold all bode well for the metal's second coming. Pento predicts this "huge advance" will drive gold to a record $2,300 an ounce over the next 12 to 18 months.

As he sees it, gold is simply consolidating at this level after its previous monstrous rally took it from $250 to $1,900. He adds that he would "use this pullback as an opportunity to accumulate" gold and gold mining stocks (GDX) and that this momentary stall is "not a reason to slit your wrists."


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

Gold dip "totally out of whack with what's going on in the fundamentals" - Wealth Management

Editor Vikram Barhat of the Advisor Group site features the expertise of Sprott Asset Management's two top executives, and according to them, the fundamentals behind gold are better than ever, and when you hear the mainstream media say the economic recovery is humming along -- believe them at your own portfolio's risk:

Eric Sprott, CEO of Sprott Asset Management LP, told a roundtable this month, "There is no recovery. We're just going into a more miserable situation by the day."

He adds, "We've had negative GDP; we have a 2% tax increase and 2% reduction in your paycheque [this year], causing your discretionary spending to go down by double that rate."

As well, current gasoline prices have hit a high compared to the same period in previous years. "I don't know how anybody could be optimistic about where we're going."

John Embry, Sprott's chief investment strategist, says the alarming pace of financial decay appalls him.

"We're in an unprecedented situation today where the sovereign governments of the world are in an absolutely unsustainable debt position," he says. "This is leading to unprecedented money printing and essentially negative interest rates." ... 

"Gold's nobody else's liability and it has no counterparty risk; that is the best advertisement for gold," Embry says. "It's provided protection against destruction of wealth for centuries and we're at the cusp of another major chapter in its illustrious history."

He goes so far as to say now might be the best buying opportunity in the whole bull market.

"[Gold's] price has been really held back, the fundamentals have gotten better by the day," he says. "Yet, if you look at the price, it's been down -- totally out of whack with what's going on in the fundamentals."


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

ANZ sets $1,890 gold bullion target for year-end - Wealth Management

 Mining labor disputes in South Africa "are only going to add to the risk and the pressure that we're going to see higher costs again after some very big cost rises in 2012," ANZ Research strategist Nick Trevethan tells CNBC in a Feb. 19 interview. 

"Exploration is expensive, particularly in the gold mining area, and exploration has not been that successful. ... Gold really has been a little bit surprising. We had expected to see it push a little bit higher by now. I think what we're seeing are investors particularly in the West rotating out of gold, but those cost pressures that we talked about I think are going to support prices, and support prices at a lot higher levels than many people are talking about right now. I think there is a risk right now that gold could retrace to around the $1,540 level on a technical basis, but we've actually put out a buy recommendation today on gold below $1,610. We believe that the FOMC has been interpreted as perhaps being ... overly hawkish, and we may actually see a more dovish FOMC when we get the meeting minutes out in the middle of the week, and that would actually be quite positive for gold, I think. ... The more money Japan is pumping into the system the more positive that is likely to be for gold. ... For the end of the year we're still looking at around the $1,890 level, which is toward the bullish end of the spectrum. We're not in the $2,500-$3,000 camps, but $1,890's quite a long way to go from where we are now. But I do think if we see this more dovish FOMC and we see the return of buyers in India and in China, in addition to additional liquidity coming out of Japan, I think $1,890's very possible."


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

Tuesday, February 19, 2013

Gold supply crunch will send price to $2,000, fund manager says - Wealth Management

 Gold miners have responded to recent falls in the price by concentrating on the highest quality deposits, scrapping extraction of more marginal material. This will cause a "significant decline" in global production of gold, according to Angelos Damaskos, who runs the Junior Gold fund. 

"A shift in gold market dynamics in the near future could result in a supply crunch," he said. ...

"The consensus among generalist investors is that gold reached a near-term peak in 2011 when it spiked at $1,927 and is now in decline. This is based on apparent stability in the eurozone and confidence that the debate on the US fiscal cliff will be resolved in a satisfactory manner," Mr Damaskos explained. 

"However, it is likely that macroeconomic events will disappoint and impact the market negatively, dragging the European or US economies back into recession and forcing central banks to intervene in new, radical ways. Such developments would spook the market, encouraging investors to turn to gold as the ultimate safe haven." ...

"Should economic events take a disappointing turn, causing a flight back to gold, demand levels could exceed supply, creating a global supply crunch," he said. 

"This scenario is a recipe for the gold price to reach highs, potentially of as much as $2,000."


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

Goldcorp CEO "very bullish on the long-term fundamentals of gold" - Wealth Management

"There's so many things that impact the short-term movements in gold price, whether it's, you know, the risk on/risk-off trade moving from gold ... into equities, which we've seen in the last couple of months," Goldcorp CEO Charles Jeannes tells CNBC in a Feb. 15 interview.

"I tend to focus on longer-term movement, and I am still very bullish on the long-term fundamentals of gold, but there's no doubt that there's a bit of a move out of the safe-haven portion of the investment in gold, and we've seen that certainly this week. ... 

"On the supply side, there's the fact that it's getting harder and harder to find and build new mines worldwide. I think you're going to see very flat supply over the next two, three, five, 10 years and even declines in supply over that period of time, so if you then look at the demand side, it's been driven by two primary features: 1) the rise of the Asian economies and a tremendous amount of growth in physical demand from China in particular over the last five to 10 years, and then the other side is investment demand, and that has come up dramatically over the last 10 years, and it tends to be much more quick in moving in and out of the story. ...

"I think it is an inflation hedge and absolutely. The currency war is very interesting because it depends on which currency is winning at the time, frankly. Gold is priced in U.S. dollars, so right now the U.S. dollar is seeing strength against the yen and the euro so we're having a positive -- sorry, a positive impact on the dollar and negative on gold. That has turned and can turn around very quickly, but, again, it's your long-term view, whether it's Marc Faber or someone else in terms of how you believe the ultimate solution to extremely high debt levels worldwide is going to be resolved, and -- and there's, you know, a good argument that says the only way it's going to be resolved is through inflation."


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

Monday, February 18, 2013

Gold demand in China to exceed supply by 550 tonnes in 2015

China's demand for gold will surpass supply by at least 550 tonnes by 2015, according to statistics from China Gold Association.

A report by news agency Xinhua says the Association's latest data shows China bought 832.18 tonnes of gold in the last financial year -- almost 10% more than in the previous year.

Gold jewellery imports increased by almost 11% year on year to 502.75 tonnes, while imports of gold bars climbed more than 12% to 240 tonnes and imports of gold coins climbed more than 21% to 25.3 tonnes.

China's total gold imports rose 24% in the fourth quarter, in comparison with global demand for gold as an investment increasing just 2%, according to figures released by the World Gold Council.

China is the world's second-largest gold consumer after India, as well as the world's biggest gold producer with year-on-year growth of almost 12%.

Industry analysts quoted by CRI said a projected production increase is unlikely to meet rising demand, with imports filling the gap.


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

Saturday, February 16, 2013

Gold Bullion buying by central banks soars to 48-year high - Wealth Management

Central banks added the most gold to reserves in almost a half century last year as prices averaged a record, the World Gold Council said. 

The banks bought 145 metric tons in the fourth quarter, an eighth successive quarter of net buying, the London-based industry group said today in a report. They added 534.6 tons to reserves last year, 17 percent more than in 2011 and the most since 1964, it estimates. ...

"We think that the current rate of net central bank purchasing, driven by emerging countries, is likely to continue to be very strong," Marcus Grubb, managing director of investment research at the council, said yesterday by phone from London. "This is very much due to a desire to diversify away from over-reliance from the dollar and the euro."


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

Friday, February 15, 2013

2012 gold demand in value terms breaks all-time record high at $236 billion

 In value terms, gold demand in 2012 was US$236.4bn -- an all-time high. Gold demand in value terms for the final quarter of the year was 6% higher year-on-year at US$66.2bn, marking the highest ever Q4 total.

Global gold demand in Q4 2012 was 1,195.9 tonnes(t), up 4% on the same quarter in 2011. In Q4 2012, the average gold price reached a record level of US$1,721.8/oz, up 1% on the previous record average price in Q3 2011. The average price during 2012 was US$1,669.0/oz, up 6% from US$1,571.5/oz in 2011.

The key findings from the report are as follows:
* Whilst Indian full year demand was down 12% on the previous year, the market performed strongly in the final quarter with total demand at 261.9t, an increase of 41% on the same period last year. Both jewellery and investment demand reached their highest levels for six quarters. Demand for jewellery was up 35% year-on-year to reach 153.0t, and strong retail demand led to 108.9t of investment buying. In India the prospect of duty increases, which came in to force in January 2013, may have added to strong buying in the final quarter to beat the anticipated price rises.

* Chinese demand was flat year-on-year, reflecting the impact of economic slowdown. However looking at Q4, total demand was up 1% on the previous quarter to 202.5t. Jewellery demand was 137.0t up 1% on Q4 2011 and investment demand was 65.5t, up 2% on the previous year. These increases may reflect the fact that the economic slowdown in China appears to have been shorter than expected.

* Central bank buying for the full year rose by 17% compared to 2011, totaling 534.6t, the highest level since 1964. Central bank purchases stood at 145.0t in Q4, up 29% on the corresponding quarter in the previous year, making this the eighth consecutive quarter in which central banks have been net purchasers of gold.


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

Wednesday, February 13, 2013

Currency wars to ignite gold prices, analysts tell CNBC

 As leaders from around the world meet this week to discuss fears of competitive currency devaluations, analysts told CNBC the currency war could lead to a sharp rise in gold prices in the second half of this year, after a falloff in the first half.

"We think a currency war will be the biggest story of 2013 when we look back on the year," Patrick Armstrong, managing partner at Armstrong Investment, told CNBC on Monday. ...

Armstrong said gold always does very well when there's bad news, and said Armstrong Investment is long on the precious metal. 

"The G20 meeting I think is going to focus on what people are doing with their currencies, trying to gain an edge with currency manipulation. Whenever that's the backdrop, gold has a place in the portfolio," he said. ...

Michael Widmer, metals strategist at BofA Merrill Lynch Global Research, has a similar outlook. He told CNBC on Monday that the volatile price of gold has more downside in the near term, before any currency wars truly begin, than in the longer term.

"I think the problem that the bugs have at the moment is that there really is a lack of a drive out there," he said.

"I wouldn't be surprised if we had another 100 bucks downside from here. And that's simply because I think we are moving now into an environment where we should see global growth starting to come in a little bit better."

The potential upside for gold in the second half of 2013 will be $250-$300, said Widmer, as markets have yet to price in that countries will continue to devalue their currencies. 

"If the yen remains relatively weak, I think other emerging markets, or Asian central banks, should start to become more proactive in managing their exchange rates," he said. 

"If that happens, their FX reserves should start to increase, and then they should start to diversify their U.S. dollar holdings into gold holdings again, which has happened during the past few years."


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

Friday, February 8, 2013

Gold Bullion headed to $7,000, Jim Rickards says

 Is a currency crisis inevitable? "I think it is," Tangent Capital Partners exec Jim Rickards tells The Wall Street Journal in a Feb. 5 interview.

"All major central banks are easing," he says. "What will happen eventually is there will be so much money printing that this will lead to inflation. Not right way -- I expect later this year or early next year. The end game is collapse of the international monetary system. This has happened three times in the last 100 years. ... I expect sometime sooner than later we'll have another collapse."

How will gold respond? "My long-term view is that it's going significantly higher. My estimate is $7,000 an ounce -- you know, it could be in a range from $3,000 and $10,000, but 47,000 is my target. But it's not going to get there all at once."

One major factor is that China is "in a scramble to acquire gold," he explains. With about 1,000 to 3,000 tons, compared with 8,000 tons for the United States, China doesn't have enough of the precious metal.

"China needs to get to 4,000 to 5,000 tons to look the United States in the eye and be an equal country," Rickards notes.


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

Monday, February 4, 2013

"Gold's poised for a big rally" to $2,000, Longview economist tells CNBC

 "There's lots of contrarian reasons telling you that gold's poised for quite a big rally," Longview Economics economist Harry Colvin tells CNBC in a Feb. 4 interview. 

"You look, for example, at speculative positions; they've unwound considerably. Sentiment used to be quite bullish; it's now bearish. Fund flows in the physical market are now rolling over. You know, on a contrarian basis there's a good argument to own gold. The real reason though is QE3. The Fed [is] expanding their balance sheet at $85 billion a month. And that's just the similar kind of pace to what they were doing in QE1 and QE2. And of course it injects liquidity into markets, it debases the dollar, and underpins the rally in gold prices. ... The speculators always give up on gold at the lows. Everyone is always bearish at the lows. That's the time to buy it. We're going to get a good rally this year. ...

"We don't need inflation pressures for a gold price rally. We haven't had inflationary pressures in recent years. The only inflationary pressure we have is from QE pushing commodity prices up. You look around the world, there's lots of deflation in the West. U.S. wage inflation is at a 60-year low. There's a big output gap. There's loads of unemployment. There are deflationary pressures. And that's why we've got the Fed stepping in to build inflation pressures, to do QE, to get asset prices up, to create a wealth effect, to try and get the economy going. ...Gold doesn't really change its colors. Since 1971 and the end of Bretton Woods long-term trends in gold prices have been determined most entirely by real interest rates in the U.S. ... 

"Gold's gone sideways for 16 months. That's because the balance sheet in the Fed has gone sideways for 16 months. The balance sheet is about to expand rapidly. And with that we're going to get a rally in the gold price, it's going to go hard this year and probably into next. ... We're going to get a rally that was similar to the rally that we got in QE1 and QE2 when the balance sheet expanded and injected liquidity into markets. ... We'll get over $2,000 and we could go even higher. It depends on how much QE they do."


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

Will gold bullion benefit as world's largest public pension fund weighs "alternative assets"?

"Japan's new ultra-loose monetary policy is likely to impact investor behavior in a number of ways as expectations of yen weakness become entrenched," writes Craig Stephen at MarketWatch. "Japanese investors will become more aggressive searching for yield and diversifying into non-yen assets to protect against currency debasement."

This appears to be playing out now -- in a major way. The following Bloomberg story reveals that a major pension fund is considering selling bonds and investing in "alternative assets," which by definition include gold.

Japan's public pension fund, the world's biggest manager of retirement savings, is considering the first change to its asset balance as a new government's policies could erode the value of $747 billion in local bonds. 

Managers of the Government Pension Investment Fund, which oversees about 108 trillion yen ($1.16 trillion) in assets, will begin talks in April about reducing its 67 percent target allocation to domestic bonds, President Takahiro Mitani said in a Feb. 1 interview in Tokyo. The fund may increase holdings in emerging market stocks and start buying alternative assets.

Zero Hedge weighed in with this comment: "As for 'alternative assets,' if this includes gold, prepare for liftoff as all other retirement fund managers across the world, who have a blended allocation to gold somewhere between 0% and 0.5%, piggyback on Japan's example."


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

"Gold and silver may be the best investments in the next several months"

Gold is the one thing we see going up more than anything else in the near term. The more money governments print, the better it is for gold. But when that government strategy fails and economies melt down, gold will go down according to Harry Dent. 

Gold and silver may be the best investments in the next several months. The gold and bond bubbles will be the last to peak as even the bond bubble seems to be starting to unravel. Everybody has been rushing into gold, silver and bonds as safe havens, but the truth is investors keep rushing into every bubble until it bursts and, at some point, all the bubbles burst. ...

For two years, gold has been trading between $1,520 and $1,800. If gold breaks above $1,800, the next target is $1,934 (the past high), and then a new all-time high is likely between $2,030-2,080. If it gets that high, we would advise people to take their gains in gold.


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

Friday, February 1, 2013

Gold will hit $1,900 this year, legendary investor Byron Wien tells CNBC

 Gold will hit $1,900 this year, predicts legendary investor Byron Wien, vice chairman of Blackstone Advisory Partners, in a Jan. 31 CNBC interview. 

"I'm not a commodities speculator. I buy gold as an insurance policy against calamity in financial assets. If the market is turbulent, if the VIX goes up, I think you're going to be glad you own gold. I have a 5% position in gold. I don't own it because I think it's going up. I own it because if my financial assets get into trouble, I'm going to be glad I have a little insurance in the form of gold. ... The dollar is the reserve currency, and it's being debased by the Federal Reserve. But so is the euro being debased by the European Central Bank, and so is the yen by the Bank of Japan. So it's a currency war of competitive devaluations. And I think the dollar will pretty much hold its own against the yen and the euro this year, even though the Fed is debasing it, because the other central banks are doing the same thing."


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

Keep calm, buy gold, and get out of bonds, says John Butler

The following text is an excerpt from an essay titled "Countdown to Collapse" by John Butler, chief investment officer at Amphora and the author of "The Golden Revolution: How to Prepare for the Coming Global Gold Standard":

If the recommendation to accumulate gold in advance of its remonetization for use as an international money seems obvious, perhaps less obvious is to reduce holdings of bonds. Why should a remonetization of gold lead to higher bond yields/falling bond prices? After all, the economic dislocations associated with international monetary regime change could well tip the world into yet another recession as the associated economic rebalancing takes place.

While we have come to associate rising yields with economic recoveries and falling yields with recessions, in fact, on a sound money foundation this relationship does not hold. Back when the world was on the gold standard, for example, yields sometimes rose in recessions and declined in recoveries. This is because the central bank was unable to manipulate the bond market with monetary policy.

Take the euro-area today as a contemporary case in point. As Greece, Portugal and Spain have tipped into deep recessions, their bond yields have risen as they lack national central banks which can buy their bonds with printed money. And investors have a choice whether to hold these bonds, or to hold the bonds of sounder euro-area governments, such as Germany, hence the wide spreads that investors demand in compensation.

A return to gold-backed international money will have much the same effect but at the global level. US Treasuries and other bonds will need to compete more directly with gold itself as a store of value or as official reserves. Interest rates will therefore need to rise to compensate investors for the very real possibility that the supply of bonds will just keep on growing to finance endless government deficits while the supply of gold remains essentially fixed.

Now I am under no illusions here. If the US, euro-area, UK and Japan face sharply higher borrowing costs in future, they are going to have debt crises similar to those faced by Greece, Portugal and Spain today. Indeed, with no one willing or able to bail them out, the associated crises may be more severe. The US and other indebted countries may resort to capital controls and even to selective default on their debt, such as that held by foreigners abroad.

If so, this will be another major escalation in the currency wars, one that will begin to resemble the 1920s and 1930s in its intensity. Those were sad decades, to be sure, in which much of the global middle class saw its savings wiped out at least once and, in some cases, twice. They didn't care whether this occurred via inflation/devaluation or via deflation/default. Investors today shouldn't care either. They should accumulate gold and certain other real assets in limited supply. These are the ultimate insurance policy against inflation, deflation, devaluation, currency and trade wars, financial crises, monetary collapse ... you name it. The time to do so is running out.


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