Gold & Silver ( Hall of Fame Articles )

Gold & Silver ( Hall of Fame Articles )

Postby winston » Thu Oct 08, 2009 7:34 pm

Has the Smart Money Turned Stupid? By Jeff Clark

When it comes to gold, it has always been wise to watch the "smart money."

As a group, commercial traders tend to own tons of gold just before the price of the shiny metal bottoms. And they have their biggest short positions on gold right before the price peaks.

Take a look...

The numbers on this chart display the net futures contract positions of commercial gold traders. In March 2008, as gold powered above $1,000 per ounce and as mom-and-pop investors were chasing the price higher, the smart money was selling. Commercial traders were net short a total 253,000 gold futures contracts. At the time, that was one of the largest net short positions ever recorded.

The gold price peaked almost immediately and didn't bottom until November 2008. By that time, commercial gold traders had closed out their short positions and were net long 92,000 futures contracts.

Now, 92,000 contracts may not seem like much when compared to a 250,000-contract short position. But remember, commercial traders also own the gold metal itself. So they often use futures contracts to hedge positions, meaning it's normal to see the smart money with a modest net short futures position. It's a pretty strong commitment for the smart money to be long gold AND long gold futures contracts.

Sure enough, that large commitment marked a bottom in the price of gold.

In February of this year, once again as gold approached the $1,000 level, the commercial traders amassed another large short position. And once again, gold peaked almost immediately.

Two weeks ago, the Commitment of Traders report disclosed the commercial net short position was 285,000 gold futures contracts – perhaps the largest net short position ever recorded. But look at what has happened since then...

The price of gold has gone... up.

Could it be the "smart money" gold traders are wrong at last? After years of being on the right side of the trade, are they finally going to be caught with their shorts down? Is it really going to be different this time?

Or is it possible the commercial traders haven't finished making their downside bets? Are they selling even more gold futures contracts into this week's gold breakout in anticipation of a reversal?

The Commitment of Traders report is published every Friday (you can access it on many gold websites, including www.321gold.com).

I'll be looking to see if the smart money has increased its short-side exposure – meaning the next big decline in gold's price may be just in front of us... or if commercial traders have been frightened into covering some of their short positions – meaning the smart money isn't quite so smart anymore. If that's the case, gold may be on the verge of another surge higher.

We'll know on Friday.

http://www.growthstockwire.com/
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Re: Gold ( Hall of Fame Articles )

Postby winston » Sat Oct 17, 2009 10:38 pm

The Only Sure Thing We Know About Gold and the U.S. Dollar
By Jeff Clark, Casey's Gold & Resource Report

In August, the U.S. dollar celebrated its 38th anniversary as a fiat currency.

When Roosevelt issued his infamous 1933 presidential diktat, forcing delivery (confiscation) of gold owned by private citizens to the government in exchange for compensation, gold was $20.67 per ounce. In January 1934, the price was raised to $35 per ounce. The U.S. government pocketed the difference – and essentially devalued the dollar by 69%.

Yet the dollar remained convertible, and foreign central banks could redeem their dollar reserves for gold. This presented no problem when the U.S. was running trade surpluses and foreigners didn't have many dollars to exchange for gold. But in 1965, France's President Charles de Gaulle started aggressively exchanging his country's dollars for gold and loudly encouraged other countries to do likewise. That year, U.S. gold holdings fell to a 26-year low.

Several schemes were tried to stop the drain on the U.S.'s hoard, including lifting the price to $42 per ounce early in 1971, but nothing worked. The run on the dollar did not abate.

With the U.S. unable to eliminate its trade deficit, Nixon was faced with the stark reality of another dollar devaluation. He opted instead to close the gold window on August 15, 1971, ending dollar-for-gold convertibility. The dollar was suddenly off the gold standard, and half of U.S. gold holdings had disappeared. The greenback began to "float," meaning it wasn't tied to any standard and could be printed at will.

So how's it done since then?

The following chart tracks what has happened to the purchasing power of the dollar and gold since the gold standard ended in 1971. After adjusting for inflation, you can plainly see the erosion of a dollar bill, now able to purchase only 18 cents of what it did in 1971, vs. an ounce of gold, which has not only stood up but increased in purchasing power.

There are two overriding conclusions from this chart:

The dollar has consistently lost value since coming off the gold standard.

While gold's price has fluctuated, its purchasing power has endured. This fact will not change and is the reason you should own physical gold. It's what I call the four Ps: your Personal Purchasing Power Protection.

At Casey Research, we believe the dollar must go lower over the coming years. Since the end of August 2008, the past year, the U.S. monetary base (coins, paper money, and central bank reserves) has swelled from about $800 billion to $1.7 trillion. This is the largest expansion in history and a staggering devaluation of the dollar.

And as you already know, we're also taking on unprecedented amounts of debt. Year-to-date government spending is $2.9 trillion, while tax revenue is only $1.6 trillion. But that's nothing compared to the massive unfunded liabilities (meaning, they are not covered by an asset of equal or greater value) of Medicare, Medicaid, Social Security, and prescription drugs. Liabilities from this trio total $105.7 trillion.

Taking on debt is like getting a tattoo: It doesn't go away, and it's pretty painful to get rid of. The only way the U.S. government can get rid of its tattoos is by paying them off with greatly diluted dollars.

There are a lot of uncertainties about how this situation will play out. But the future purchasing power of gold is not one of them.
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Re: Gold ( Hall of Fame Articles )

Postby winston » Tue Oct 20, 2009 8:30 am

Perfect storm for silver brewing as antibiotics substitute--Silver Institute

Silver may soon replace antibiotics as an alternative for healing, and is increasingly gaining ground in the burgeoning field of nanotechnology.

Author: Dorothy Kosich

SPOKANE, WASHINGTON -

The over-prescription of antibiotics and the rapid spread of bacteria globally are creating "a perfect storm for silver," which will encourage even more medical use of the precious metal, Silver Institute Executive Director Mike DiRienzo said Thursday.

In a presentation to the Silver Summit in Spokane, DiRienzo detailed new and emerging uses for silver, lead by the metal's growing significance in hospitals and the practice of medicine.

"Currently we're seeing a surge of applications for silver-based biocides in all areas: industrial, commercial and consumer. New products are being introduced almost daily," he said.

Silver may soon replace antibiotics as an alternative to healing, he explained. The use of silver in medical implants is in the testing phase, such as the use of silver in medical implants to reduce the threat of spinal infections.

DiRienzo explained, "Engineers at the University of California, Davis have developed a ‘smart' contact lens designed to measure pressure within the eye. High eye pressure can be a sign of glaucoma, the world's second leading cause of blindness."

"At the heart of the new lens are sensors that measure stress on the cornea and the fluid pressure within the eye. The lens is composed of a type of silicone used in commercial contact lenses and silver particles placed on the lens that act as conductive wires and double as antimicrobial agents," he added.

The new lens could be used by hospitals and doctors to check for glaucoma but also by patients in their homes through a personal computer hooked into a wireless network.

Meanwhile, hospitals are increasingly utilizing silver in equipment surfaces, coatings, and other uses aimed at reducing bacteria growth. Silver is even being used in the paper used in hospital notes.

The Federal Drug Administration is permitting silver to be used in bottled water, DiRienzo noted. It is already being utilized in coatings for equipment used in the processing for milk.

Silver can also be found in germ-killing lockers now being used by the military, he said.

The precious metal is also being increasingly used in textiles, such as in polyester fiber coatings. DiRienzo said India just began using silver to preserve silk fabrics. Scientists at the Indian Institute of Technology in New Delhi have developed a method to create anti-microbial silk by infusing the delicate material with silver ions.

"This marks the first time that silver ions have been embedded into woven silk although it has been successfully applied to cotton and synthetic textiles," DiRienzo noted.

Among other consumer applications of silver are consumer electronics with millions expected to be invested in silver conductive inks by 2015, DiRienzo explained.

Silver has been used in surface mounting, which allows components to be fastened both mechanically and electronically to printed circuit boards. Components are placed in indentations on circuit boards and molten silver alloy solder flows across its surface to create an instantaneous permanent bond between the two.

Silver is used to concentrate solar-energy for power generation, and in humidifiers to slow the growth of bacteria. It also used in rechargeable solar batteries.

Silver is also reducing bacteria in refrigerators and in washing machines, he added.

DiRienzo noted that "the newest trend is the use of nano-silver particles to deliver silver ions as the nano-technology industry grows and we become more knowledgeable about how nano-particles behave."

He called silver nanotechnology "a huge market," which is being somewhat stymied by a two-year battle with EPA over the designation of the technology as a potentially toxic metal.

The U.S. has the heaviest nanotechnology investment, DiRienzo noted, with Japan is second place.

http://www.mineweb.com/mineweb/view/min ... sn=Detail#
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Re: Gold & Silver ( Hall of Fame Articles )

Postby winston » Mon Nov 30, 2009 7:57 am

Mainland set to mark golden records

China, the world's largest gold producer, may have record demand and output this year as jewelry consumption soars and miners expand production after prices reached all-time highs, according to the China Gold Association.

The country's gold demand may be more than 450 tonnes this year, up from 395.6 tonnes in 2008, and output may climb to 310 tonnes, compared with 282 tonnes a year earlier, Zhang Yongtao, deputy secretary-general of the association, said yesterday. China's gold output grew by 9.5 percent per annum in the past eight years, he said.

Bullion hit a record US$1,195.13 (HK$9,322) an ounce on Thursday as the US dollar weakened further.

China is quite a likely buyer in coming weeks, National Australia Bank analyst Ben Westmore said.

Record prices boosted profitability of Chinese miners, giving them incentive to expand production, Zhang said.

Source: BLOOMBERG
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Re: Gold & Silver ( Hall of Fame Articles )

Postby winston » Tue May 31, 2011 8:12 am

Gold's continued rise down to supply and demand by Dr. Check, The Standard HK
Tuesday, May 31, 2011

Gold has once again, after a very brief pause, started climbing. Some see the precious metal surging to US$3,000 (HK$23,400) per ounce in two years.

It now stands at about US$1,535 per ounce, having risen from US$300 per ounce in the past 10 years. I am bullish as long as gold stays above its critical support level of US$1,310 per ounce.

China remains the key. The country produced 285, 300 and 400 tonnes of gold in 2008, 2009 and 2010, respectively.

But China consumes more than it produces, using up 571 tonnes of gold last year. Besides, global gold production is falling. In 2001, 2,600 tonnes of gold was produced worldwide. The figure dropped to 2,350 tonnes in 2009.

Falling output at South African and Russian mines is to blame. South Africa produced 402 tonnes of gold in 2001 but only 210 tonnes in 2009. Russia produced 304 tonnes in 1989 but 185 tonnes in 2009.

So, demand is rising but supply is falling. What will happen to price then?


http://www.thestandard.com.hk/news_deta ... 10531&fc=2
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Re: Gold & Silver ( Hall of Fame Articles )

Postby winston » Sun Jul 24, 2011 5:22 pm

Above Ground Stocks: 165,000 tons = US$8t

2010 Global Supply: 4100 tons

China's 2011 Demand: 700 tons

India's 2011 Demand: 1200 tons


Source: Reuters
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Re: Gold & Silver ( Hall of Fame Articles )

Postby winston » Thu Dec 01, 2011 2:22 pm

DJ China Gold Jewelry Consumption To Double In Less Than 10 Years -WGC Executive

SHANGHAI (Dow Jones)--Chinese gold jewelry consumption may double in less than 10 years compared with last year's consumption of 452 tons thanks to an increasingly affluent population, the managing director for the Far East at the World Gold Council said Thursday.

Gold jewelry consumption in the world's second-largest consumer may reach 550 tons this year, which is "ahead of the curve of our original estimate of 519.6 tons.

Based on this consumption, China's doubling may come earlier than 2020," Albert Cheng said at an industrial conference.

The WGC previously forecast China's gold consumption to double to 955.2 tons by 2020, Cheng said.

Around 6,000 tons of gold is stored with Chinese consumers, compared with 18,000 tons in India, he said.

The WGC expects China's total gold consumption to reach 750 tons this year, with 200 tons coming from investment demand for gold bars and coins, Cheng said previously.

Source: Dow Jones Newswires
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Re: Gold & Silver ( Hall of Fame Articles )

Postby winston » Thu May 17, 2012 6:18 am

Canary In The Gold Mine: In Historic Move, Japanese Pension Fund Switches To Gold For First Time Ever by Tyler Durden

China is now on its way to becoming the biggest source of gold demand, surpassing India, but more importantly as of hours ago, in a truly historic move, "Okayama Metal & Machinery has become the first Japanese pension fund to make public purchases of gold, in a sign of dwindling faith in paper currencies."

Not our words: the FT's.

Initially, the fund aims to keep about 1.5 per cent of its total assets of Y40bn ($500m) in bullion-backed exchange traded funds, according to chief investment officer Yoshisuke Kiguchi, who said he was diversifying into gold to “escape sovereign risk”.

The first of many:

Historically, institutions in the $3.4tn Japanese pension market have clung to traditional assets. Bonds accounted for 59 per cent of industry assets in 2011, the highest share in the world, according to Towers Watson, a consultant.

Just 6 per cent – the lowest share – was invested in alternatives such as property, private equity and hedge funds.

Nomura, Japan’s biggest wealth manager, added a gold option to its monthly survey of 1,000 randomly selected retail investors in February. Every month since, gold has been ranked the third-most desirable addition to portfolios, well ahead of competing assets such as investment trusts, bonds or foreign securities.

And the absolute punchline:

With institutions warming to gold, too, demand could grow further.

“If you look at assets over the past couple of decades, equity has been a loser, while fixed income offers tiny coupons,” said Yoshio Kuno, Japan head of Newedge, the futures broker. “Gold is becoming an acceptable currency substitute.”



http://www.zerohedge.com/news/canary-go ... -time-ever
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Re: Gold & Silver ( Hall of Fame Articles )

Postby winston » Fri Jan 25, 2013 7:54 am

Gold - Visualized in Bullion Bars

There's surprisingly little Gold in the world & this infographic shows all the Gold ever mined.

In this Gold infographic everything is calculated with Gold price at $2000/oz.

When Gold reaches $3110/oz, 1 oz of Gold & a $100 bill will have equal value in weight, and it won't matter if you have 1oz of $100 bills or 1oz of Gold.

http://demonocracy.info/infographics/wo ... /gold.html
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Re: Gold & Silver ( Hall of Fame Articles )

Postby winston » Mon Mar 03, 2014 6:03 am

Who’s Got the Gold?

by Sean Brodrick

Source: The Oxford Club

http://www.investmentu.com/2014/Februar ... ?src=email
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