We Are On The Verge Of A Historic Meltdown & Collapse

On the heels of a tremendous rally in gold and silver, today a man who has been involved in the financial markets for 50 years shocked King World News when he said that we are on the verge of a historic and catastrophic global financial “meltdown.”  He also spoke about events that are unfolding behind the scenes at the White House right now.  This is without question one of John Embry’s most powerful interviews ever.

Embry: “I guess I’m always unnerved as a result of what happened in April, the last time the President of the United States had a meeting with all of the bank heads, and two days later the price of gold was trading smashed for over $200.  Now, the President is meeting with all of the heads of the various agencies, institutions, the Fed, and all of the other key money entities in the United States today.  What’s that all about?

But clearly if the President is having this meeting, there is a crisis unfolding somewhere in the background, and it could very well relate to the dollar, interest rates, and the massive derivatives market associated with interest rates. Read more >>

Gold flows from Britain to Switzerland surge in H1-Macquarie

Britain's gold exports to Switzerland surged in the first half of this year, Australian bank Macquarie said on Monday, suggesting bullion being sold out of exchange-traded funds may be heading for Swiss refineries before being sold on in Asia.

The UK exported 240 tonnes of gold to Switzerland in May alone, while its exports over the first half of this year totalled 797 tonnes, Macquarie said in a note.

In contrast, Britain exported just 92 tonnes of bullion to Switzerland in the whole of last year, it said.

"The UK does not have gold mines, so where has it all come from? The obvious source is the gold exchange-traded funds (ETFs), most of which hold their gold holdings in London vaults, and which saw huge outflows in 1H 2013," Macquarie said.

"And why is it going to Switzerland? Two explanations make sense. One would be that investors have decided to switch their gold investments from ETFs to allocated deposit accounts, which are often held in Switzerland." Read more >>

Is silver back in the bull market?

It is silver's time to shine after the precious metal climbed for seven straight sessions to notch gains not seen in nearly five years, and analysts say its winning streak is far from over.

Silver prices rallied to almost $23 a troy ounce on Thursday, after logging collective gains of 17 percent in over the past seven sessions, as a surge in gold prices and a more positive outlook for global industrial production boosted sentiment.

"It's something that you can't really ignore at the moment...There is plenty of talk about silver being in a bull market now, after the recent gains, it does look like it is in really good stead," said Stan Shamu, market strategist at trading firm IG.

Silver prices, which are closely correlated to gold, have followed steep falls in the yellow metal this year. Silver plunged 40 percent from the highs of at the start of the year to lows of $18.19 in June 28, while gold dropped 29 percent over the same period.

Demand for the precious metals, which are viewed as safe havens, waned as investors grew more confident over a more stable global economy. However, prices have recovered in recent weeks as Fed dialogue suggested tapering plans could be delayed and a flare up of violence in Egypt renewed appetite for the safe haven assets. Read more >>

Peter Schiff on Gold and Silver: Load the Boat and Back Up the Truck

Greg Hunter’s USAWatchdog.com
For anyone who sold physical gold in the current precious metal downturn, money manager Peter Schiff says, “There’s going to be a big problem because the gold they sold on the way down isn’t going to be available on the way back up because the people who own it aren’t going to sell it at any price.

This is the time to load the boat, to back up the truck.”  Schiff is a longtime advocate of precious metals and has taken much criticism in this downturn.  Schiff answers his critics by saying, “The people who are always making fun of me every time there is a pullback are the ones that never bought gold in the first place.

Even though it’s pulled back, it’s still a lot higher than it was when they first started laughing at me for buying gold.”  Talk of a new Fed Chairman to replace Mr. Bernanke will only be bullish for the gold price.

Schiff predicts, “If it’s solely based on which Fed Chairman is the most bullish for gold and silver, I would say that would be Janet Yellen.  No matter who’s put in at the Fed, they are going to keep printing because that’s all they can do.”  Schiff warns, “They’re going to keep printing until we have a currency crisis . . . and that is the most bullish environment for gold. Read more >>

Gold’s undervaluation is extreme

The price of gold fell last week to the $1,200 level. The lemming sentiment in capital markets is uniformly bearish, yet every price-drop brings forth hungry buyers for physical gold from all over the world. Even hard-bitten gold bugs in the West are shaken and frightened to call a bottom, yet it is these conditions that accompany a selling climax. This article concludes there is a high possibility that gold will go sharply higher from here.

There are three loose ends to consider: valuation, economic and market fundamentals.

VALUATION

So far as I am aware nearly everyone is overlooking the obvious. You cannot consider the value of gold without taking account of the changes in the quantities of the currency and the above-ground stock of gold over time. The chart above shows the adjusted US dollar price of gold rebased to 100 in January 2005 when the gold price was $422. In 2005 dollars, using True Money Supply plus excess reserves as the currency adjustment, gold has risen only 13.9% to an equivalent price of $481.

TMS, or Austrian Money Supply, represents cash, checking accounts and savings deposits that can be redeemed for gold under a full convertibility regime. Excess reserves represent the funds deposited by banks at the Fed, which similarly can be redeemed for gold. The sum of TMS and excess reserves are therefore the comparable currency measure. Read more >>

Gold prices slide to 34-month low

Gold prices are on track to lose nearly 25% this quarter after sliding to a 34-month low Wednesday. The August contract for gold fell more than 4% to $1,227.10 an ounce early Wednesday, taking the price down to the lowest level since August 2010. Prices had been nearly $1,600 at the start of the quarter and had topped $1,900 for the first time last August.

If the sell-off continues, the second quarter will go down as one of the worst in decades.
Fears that the Federal Reserve will pull back on stimulus has been particularly bad for gold, which had been driven higher by worries that the Fed's stimulus efforts would weaken the dollar and cause inflation.

"It has been a turbulent past few weeks for the yellow metal and there seems little to suggest any let-up in the months ahead," said Ishaq Siddiqi, market strategist with ETX Capital, in a note to clients. "We could see gold prices test the $1,000 mark in the run-up to Fed tapering of stimulus." Read more >>

Redemptions In The GLD Are Bullish For Gold

Recent outflows from physical gold exchange traded products (we use the SPDR Gold Shares, GLD) have been interpreted by the financial press as a sign of weakness in the demand for gold as an investment vehicle.

However, a closer look at the evidence suggests otherwise: the largest outflows in the history of the GLD (see Figure 1) started well before the large drop in the price of gold we observed on April 15th, 2013 (-9%, which represents a 1 in 11 years event). In fact, the net redemption of shares of GLD started as early as the second week of January 2013 (on a 3-month cumulative rolling basis). In this note, we will explore the theory that it was the shortage of physical gold and the ensuing arbitrage opportunity that drove market participants to redeem shares of GLD.

So why are the bullion banks that act as Authorized Participants for GLD, a group that includes JP Morgan and HSBC and others (who by-the-way were mostly bearish on gold leading to the April Crash), redeeming so many shares of GLD? Read more >>

Gold's worst yearly start in over 30 years

Hedge funds increased bets on lower gold prices after investors pulled a record $20.8 billion from bullion funds this year while BlackRock Inc. (BLK), the world’s biggest money manager, said it’s still bullish.

Speculators held 67,374 so-called short contracts on May 7, 6.4 percent more than a week earlier, U.S. Commodity Futures Trading Commission data show. The net-long position dropped 10 percent to 49,260 futures and options. Net-bullish wagers across 18 U.S.-traded raw materials climbed 5.8 percent to 582,265, with gains for cocoa, cotton and hogs.

Gold is having its worst start to a year since 1982 after dropping 15 percent and sliding into a bear market in April. Holdings in exchange-traded funds backed by bullion tumbled to the lowest since July 2011 even as central banks print money on an unprecedented scale to boost growth. BlackRock’s President Robert Kapito said May 9 he would still buy the metal, echoing billionaire John Paulson, who’s sticking with a bullish view even after losing 27 percent in his Gold Fund last month. Read more >>

All Alterantive Currencies Must Be Crushed

Gold prices just entered a bear market. Down 21% from their mid-2011 highs. Today's drop is the largest since 2/29/12 - LTRO2 and takes the price of the barbarous relic back to July 2011 lows. Silver is also seeing its biggest down-day since LTRO2 as it tests 2012 lows. Must. Destroy. All alternative currencies. Read more >>

Collapse of the U.S. Dollar Could Happen Any Moment

Greg Hunter’s USAWatchdog.com

There has been plenty of calamitous news surrounding the European debt crisis.  Greece is insolvent.  Spain just got a big bank bailout, and Ireland wants a new bailout deal.  No matter how bad it looks in the EU, Paul Craig Roberts says the problems in Europe are “nowhere near as big as the ones here.” 

The U.S. is printing massive amounts of money to paper over the mess, but it won’t work.  Roberts says a collapse of the U.S. dollar could happen at any moment.   It could be triggered by any number of things such as war or a derivatives meltdown.  When a former Assistant Treasury Secretary (under the Reagan Administration) and a PhD in economics sounds the alarm bell, people should take cover. 

Dr. Roberts says, “The cliff dive we are experiencing in housing isn’t over,” and precious metals prices are “being suppressed.”  Roberts says, “Gold prices should be rising.  Why? Because the debt is rising.”   What is the reason why Dr. Roberts thinks the suppression game has gotten so intense?  Dr.  Roberts says, “The fact that they are driving the price down suggests to me the situation is getting more desperate.”  Greg Hunter interviews Paul Craig Roberts one on one about these subjects and more.

Gold and Dow Flash the Same Warning Signal

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On Friday, both gold and the Dow flashed the same warning signal—the economy is in deep trouble.  The Dow plunged nearly 275 points on the news of a weak jobs report, and gold rocketed higher by $66 on speculation global bankers are going to print money to resuscitate a dying financial system.  You do not get this kind of tandem move in opposite directions by coincident.  Last week, both the stock and gold markets appeared to stop pretending and acknowledged the vortex of debt and insolvency that could suck us all into a black hole.

Renowned gold expert Jim Sinclair of JSMineset.com said Friday, “Those popular gold writers calling for much lower gold prices are simply out of their mind and disconnected from reality.”  Sinclair has been calling for “QE to infinity” (money printing) for years now, and he’s been right.  Of course, money printing masked the recession/depression since 2008; and now, it looks like more of the same bad medicine is on the way—only a much higher dose.  My only question is when does the money printing stop working and turn the currency into confetti?  It appears we will find out sooner than later. Read more >>

Some Considerations on Precious Metals

http://readynutrition.com
If you want to expand your portfolio to include precious metals, here are some considerations: a single ounce of gold stores more value than silver. If you need portability for a large amount of wealth gold coins and bars will be your primary precious metals investment. Currently an ounce of gold is about $1550. With less than a pound of coins in your purse or backpack you can conveniently move $25,000 in value.
   
What gold offers in portability it lacks in divisibility. This is where silver comes in. You may not be able to move $25,000 of silver conveniently (weighing around 50 pounds!). But because of it’s lower value per ounce silver is an excellent mechanism of exchange for things like food, gas, clean water, or tools if the dollar hyper-inflates or crashes.

You can purchase silver in bars (100 oz, 10 oz) or coins (1 ounce, or U.S. government issued pre-1965 halves, quarters and dimes). With the smaller denomination coins like US quarters you will have portability for a small amount of cash (40 quarters is about $150 dollars worth) and you’ll have coinage that should allow you the ability to purchase just about any item someone is willing to sell.
   
Silver allows you to make modest, weekly investments of anywhere from $5 to $50 dollars and still build a store of wealth.
   
If you are investing a large sum of money into precious metals, gather details about the types of coins you are buying, especially if you’re buying gold. Acquire a coin caliper and/or testing kit to ensure you’re getting what is being advertised. More...

Gold Drops to 4-1/2-Month Low

Gold prices fell to a 4-1/2-month low on Monday, hit by concerns about a worsening debt crisis in the euro zone following political deadlock in Greece which fueled risk aversion and put pressure on the euro.

Spot gold hit a session low at $1,556.61 an ounce, its lowest since December 30, 2011, before recovering slightly to trade at $1,561.10 an ounce at 1323 GMT, down 1.1 percent from $1,578.30 hit late in New York on Friday. Gold has moved in tandem with riskier assets this year as the turmoil in Europe sent the euro to multi-month lows and investors turned to the safety of the dollar, analysts said. Gold is under severe pressure.

The U.S. dollar is being seen as a safe haven at the moment and as long as the dollar is appreciating against the euro this is clearly weighing on the gold price," said Daniel Briesemann, analyst at Commerzbank. "I wouldn't be surprised if we test the December low of around $1,520 an ounce and if we don't stop here we could go below $1,500." More...

Gold is Sending a Dire Economic Warning

There are many people willing to deny basic economic reality or the news that the manipulated government data points from around the world are sending, however gold and the gold ETF (GLD) continues to flash a warning clarion that can not be missed by any observer.

Unfortunately for the naysayers, gold is still the final resting place for value and is indeed viewed as the alternative world currency by major economic powers such as China and Russia. The U.S. Dollar has had a nice run and with the impending collapse of the European Union as constructed appears imminent, another surge in the U.S. currency should be expected.

Thus a review of the warning from gold is warranted considering the horrible technical action this year and what the desperation to raise cash will create with a once in a lifetime opportunity for the wise to buy gold at a discount. More...

Gold May Top $6,000, Silver $600: Asset Manager

Image via WikipediaGold prices may reach $6,200 per ounce in a bull run which will “end all major bull markets,” Urs Gmuer, asset manager at Dolefin, a Swiss investment advice firm, told CNBC.

Gmuer’s prediction is based on analysis of the last major gold boom of the 1970s, during which gold prices rose from $35 per ounce to $850 per ounce. Gmuer said that in the current bull run, prices would be pushed upwards by a protracted period of global economic difficulty—potentially lasting years—during which investors would continue to search for so-called safe havens.

“Gold prices have risen over the last few years, as the macroeconomic picture has become worse. The deterioration of the fundamental situation has now gone even further.

“Purchases by investors of gold will be based on fears of systemic risk or banking crashes,” Gmuer said. More...

It May Be 2008 All Over Again, But There Is One Key Difference

Image via WikipediaThere were two financial assets which boomed in late 2008. One was Treasury debt, the other was the US Dollar. While Gold and everything else was falling out of bed, the trade-weighted US Dollar index - the USDX - soared 21 percent from 73 to 88.2 between early August and late November 2008.

Compare that to what is happening now. Treasuries are soaring but the US Dollar is, at best, flat. And Gold in terms of EVERY major paper currency has gone ballistic. This time, things do look different. More...

Gold is fast becoming the World's defacto reserve currency

Comment of the day by davefairtex

USD is at 74, and during this whole crisis has moved very little. By comparison to the moves made in the panic of 2008, I stand by my comment.

USD moved from 71 to 90 in sep-oct 2008.
USD moved from 76 to 87 in jan-may 2010.
USD unchanged 74 to 74 in aug 2011.

Its possible that China has moved dollars to euros, and the the euro banks have moved from euros into dollars, keeping the flows neutral. It is also possible the Fed is doing monstrously large secret currency deals. But overall, no. No net flow into USD from other currencies, or else the USD would have appreciated vs. that currency. What evidence we have says - USD is not a safe haven at the moment. And gold is.

And we have to accept this is a new behavior. Just last year, things were quite different. Same thing with gold - its behaving differently. Last time around, gold got thrown under the bus. This time, new highs every week.

Source: Comment section, scroll down  

Is Gold a "risky asset" or a "safe haven"?

Image via WikipediaComment of the day by David Pierre

You have heard both of these terms used, probably in the same day and maybe even by the same talking bobblehead on financial TV. Risk on, risk off. "Gold is up because risk is being bought today...Gold is up on safe haven buying...Gold is down because the Dollar is up on safe haven buying...Gold is down blah blah blah".

So which is it really?

First off you need to understand that we live and have lived most of our entire lives in a fiat money system where the governments have decreed their currencies as the only ones that can be used and that these currrencies have absolutely zero value behind them except for the ability of the issuer to tax. These taxes pay interest and (were supposed to) pay down principal. Secondly you need to know that these governments hate Gold because it competes with their fake currencies. This is obviously because the governments can print their currencies at will whereas Gold must actually be mined with a cost of time, labor and capital.

That said, Gold is NOT a risky asset though Washington and Wall St. would like everyone to believe this, they want to keep you in "the system", THEIR SYSTEM!.

In fact, Gold is simply money, real money. It has value because it is a "thing" that best fits the description of money. It has value because it has a cost to produce or obtain, it has value simply because it "is". In today's monetary system Gold is best described as a "safe haven" because ALL of the other currencies are not safe. Back in the old days (prior to 1932 or thereabouts) Gold was not a safe haven, it was simply money. It was "cash".

In the sense that you saw a bear market in stocks or bonds or real estate on the horizon it was a safe haven just as today when a money manager goes to a high "cash" position to avoid a market downturn or panic.

Gold WAS "cash" and "cash" was readily exchangeable into Gold. Bank runs occurred when rumors started that their bank was running out of Gold, not Dollar bills.

If a bank made bad investments in loans or bonds or whatever, they were required to pay in Gold which in turn would spark fears that they were low on Gold!

Gold has always been a safe haven because it was "cash", however in today's world it has taken on a new definition of "safe haven". It's safe haven status now includes safety VERSUS "cash". VERSUS any and ALL paper currencies no matter which one you are using.

"The Money" needs to be replaced with something investors and savers will "trust". THIS will happen because the current system has been abused to the point of collapse and will end as ALL Ponzi schemes have ended.

The MOST IMPORTANT characteristic of "money" in the near term is it's ability to "store value". It is for this reason that savers and investors have for 10+ years running been turning their paper currencies in for Gold, they fear losing their purchasing power.

Gold has not "gone up", it is the global paper currencies that have gone down because of overissuance!

Truly THE most important benefit to purchasing, holding and owning Gold right now is to "make it" through to the next monetary system with your wealth in tact, period! The current monetary system is in it's "death throes", a new one WILL be devised and the easiest, safest and surest way to have a head start in this new system is with a pile of Gold (and Silver). The way to be a "charter member" of the next banking system is to have ownership in the production of both Gold and Silver.

If you understand the most basic of basics (the money), then you understand all that is needed from a financial standpoint.

Gold (and Silver) are nothing more than your "bridge" from this monetary system to the next. Your mining shares because of their operating and financial leverage are what will increase your "current wealth" and make you WEALTHY as and when the next system gets up and running. Hold as much as you can and sell as little as possible to survive until the "revaluation", your true wealth depends on it!

It seems that The Perfect Storm has arrived for gold, with silver right behind it. Kicking the financial can down the road in Europe is hitting the wall … with the monster US financial market problems becoming more glaring by the day. The reasons for owning both precious metals are becoming clearer by the day too.

And what an irony. A visible Muppet host on CNBC spoke of the "crowded" gold trade this morning. Her commentator colleague then said he was short silver. The irony is that both gold and silver are among the least crowded trades ever.

For one, the open interest in both precious metals is light years off their highs. Two, the bullish sentiment indicators are lackluster at best.

And three, there is more talk of the price vulnerability floating around than talk of grandiose higher prices. Most of the market commentary is about the risk of owning gold on the downside.

"Gold Set To Rally" - Goldman Expects Gold To Promptly Rise To $1,480

As we are experiencing a furious regime change, the sellside positional updates are coming fast and furious. The latest major recommendation change comes again from Goldman which has just reiterated its belief gold will reach its 3 month target of $1,480 shortly. Of course, after a Cramer recommendation to buy the metal, this is the only call for a higher gold price that should be of great concern to everyone. From Goldman: "We expect gold prices to rally toward our 3-month price target of $1480/toz, and continue to recommend a long gold trade. More...

Gold Buying in China Jumps as Inflation Flares

Image via WikipediaGold purchases in China, the world’s largest producer, climbed to 200 metric tons in the first two months of 2011 as faster inflation boosted consumer demand, according to UBS AG, which said the price may gain to $1,500.

“China is the big buyer,” Peter Hickson, global commodities strategist at Switzerland’s largest bank, said by phone yesterday, without giving a comparable figure for 2010. The estimate for the two-month period compares with full-year consumer demand from China of 579.5 tons for last year, according to the World Gold Council, a producer-funded group.

Bullion, which rallied 30 percent last year, surged to a record yesterday as uprisings in the Middle East, quickening inflation and currency debasement boosted global demand. China’s consumer prices rose 4.9 percent in January from a year earlier, exceeding policy makers’ 4 percent ceiling for a fourth month. Read more...