Fed Day Gold Bugs

“Here’s a nice round-up of opinions from the analyst community on whether or not there will be QE3 this week.”  Consensus: No QE3 This Week at Pragmatic Capitalism.

Arguments for holding gold:  Campbell Harvey.

Another:  “I don’t see a huge social cost to having a three or four percent rather than a two percent inflation rate.”  Fool.  Marginal Revolution.

“For all the hype over recent tech initial public offerings, did you know that investors have lost more money in Groupon and Facebook than the entire assets in all of the gold funds?”  Frank Holmes

How rare are 1 million+ ounce gold deposits at Visual Capitalist.

Will a Bear Market in Stocks Hurt Gold Stocks?  Daily Gold

Decision time for gold continues to linger:  All Star Charts.

Silver resistance levels at Nifty Charts.  Sprott is buying 7 million ounces:  Mining.

Saturday Gold Bugs

“The last time this kind of sentiment was seen after the stock panic, gold was just launching its biggest upleg of this entire secular bull!”  Zeal  “There currently is a large short position in the Comex gold market, which could set the stage for a short-covering rally in gold prices.”  WSJ

“Business Insider offers a deep dive into the world of gold, looking at what moves its price, who is invested in the commodity, and how it’s made.”  Scribd

It’ll get papered over:  “Growing Fear That Cities Will Default–Not Out of Necessity but as a Strategy”.  WSJ  With “Key price indexes are uniformly running below the Federal Reserve’s 2% objective” the door is open (WSJ).  Housing is adding to GDP (WSJ).

Agnico-Eagle (AEM) stock has returned from the dead, in a really bad tape for gold miners,  as operations have been turned around (Mining Weekly).  I wrote about it at SA.  Meanwhile, Barrick (ABX), Newmont (NEM) and Goldcorp (GG) reported lousy quarters.  Gold Bugs Index (HUI): Buy, Hold or Sell?  Safe Haven.

Deflation Now. Inflation Later by Bill Bonner.

More on Gold Set for a Huge Breakout by Robert SinnTriangulation galore — Gold and British Pounds are set to move by Peter BrandtGold & Silver ‘Chart Mania’ at KWN.

Golden Money

Gold up $32 as QE3 drumbeat grows louder at Mining.  Now they are talking ‘open-ended’ QE:  Economist.  Monetary madness in the Wall Street Journal at Economic Policy Journal.

Anatomy of Future Gold & Silver Bubble at Daily Gold.

Is GLD safe?  Precious Metals ETF Alchemy GLD – the new CDO in disguise? from Hinde Capital.

Corrections in gold since the beginning of the bull market:  Gold Money.

Gold Gearing to BreakoutDragonflyThe Golden TriangleRobert Sinn.  Gold implied volatility by Robert Sinn.  Gold next to other asset classes from Gold Money.  Oil and gold seasonality at Zero Hedge.

Saturday Gold Bugs

I look for the public pension problems to get papered over later this decade:  WSJ.  Practically speaking, central bank cooperating means easy policy at a faster pace.  WSJ

As states and city’s go bankrupt (Mish), remember gold is no one’s liability.

Coming: The End of Fiat Money is an outstanding interview with Stephanie Pomboy at Barron’s.  (Google the title to read the whole article)

Global QE Is Coming: Let the Gold Mania Begin! by Chris Puplava at Financial Sense.

Gold Q2, 2012 – Investment Statistics And Commentary at Zero Hedge.

Gold 22% Rally to Record Seen by Eric Sprott: Commodities at Bloomberg.

Chinese gold imports:  GMN

Silver Undervalued by Zeal.  The life savings of my toddler consists of three silver eagles and a few dollars.

John Doody is starting a silver letter at his Gold Stock AnalystHere is the commercial.  In precious metal bull markets silver lags until the tail end speculative phase…

Precious Metal Gold Bugs

Note this chart of credit adjusted gold from Real Return Investing at Ritholtz.  This piece might be the most worthwhile read of the week.

UBS warns of possible hyperinflation:  Zero Hedge

“On Thursday, gold futures recorded a negative 12-month return for the first time since July 2009. This is a rare occurrence over the past decade, happening on only 118 trading days, or just 4.5% of the time.”  WSJ

“If we tabulate a 33% increase in valuations, a 100% increase in margins and a 32% increase in production, it yields share price growth of 250%. This equates to HUI 1400 in 2014.”  (I reversed the bold numbers-JJ)  Daily Gold

Meanwhile, the gold miners are still stuck in the mud:  Market Anthropology.

Gold Stocks are due for a “Bounce!”  Is a 30-year under-performance long enough? at Kimble Charting Solutions.  The gold price direction:  Peter Brandt.

Rick Rule on the tightness in the physical silver market:  King World News.

Is Silver about to rally 10%? at Kimble Charting Solutions.  This silver chart is the largest symmetrical triangle I have ever seen:  Nifty Charts.

Europe Runs Over the Platinum Price at WSJ.

Goldbug Saturday

The race to the bottom goes mainstream:  Reformed Broker.

Precious Metal Summer Doldrums at Zeal.

Richard Russell:  Inflate, die or revalue.  321Gold

Bill Fleckenstein:  “And the bond market or the currency market or a combination of the two will take the printing press away…What I am salivating over is the chance to really press my gold position.  I think the next leg is going to be really, really powerful.”  King World News

“Whatever is needed to paper over the excesses of the banking industry will be provided.”  Peter Pham

“just in the first five months of 2012 alone, China has imported more gold, a total of 315 tons, than all the official gold holdings of the UK”  Zero Hedge

Central Banks are gold buyers:  Azizonomics

Metals Still Pouncing on Major Support Levels from ChessNwine.  Silver chart at Kimble Charting Solutions.

Saturday Goldbugs

QE3 sounds unlikely at this month’s Fed meeting:  WSJ

It’ll be papered over alert:  The Social Security Trust Fund projects average yields for their Treasury’s of 4%, while rolling them over at a bit over 1%.  Bruce Krasting

Devaluing the Pound Isn’t a Solution, It’s Default yet they’ll do so anyway:  Bloomberg.

“The economy created just 80,000 jobs in June… 85,000 workers left the workforce entirely to enroll in the Social Security Disability Insurance program…”  WOW!  IBD

Why GoldMises

Gold mining stocks opportunity at Forbes.

Ginormous gold mining info graph:  Visual Capitalist

Nevada: The Next American Gold Rush at Visual Capitalist

Chartology: Gold Price Near Important Resistance at See It Market.

Chartology: Silver Bounces Off Critical Support also at See It Market.

Comodity Complex Smells Debasement

Richard Russell at King World News.  The world has seen $18 trillion in monetary stimulus and certainly more than that in fiscal stimulus since the financial crisis at Testosterone Pit.

And it’s never enough, as the economy rolls over via Yardeni and Yardeni.  Why Deflation is the Biggest Catalyst for Precious Metals at Daily Gold.

We at ISA speculate a DJIA:Gold ratio of one as a reasonable approximate area for the gold bull to end.  Maybe, and dependent upon policy maker reactions.  One path to $10,000 gold:  Dan Amoss.

BRICs Priced for Economic Meltdown  Bloomberg

Re-post: “Today will be the first day in a commodity rally that should last roughly 2 years topping in mid-to-late 2014 when the dollar puts in its next three year cycle low.  The next two or three weeks should produce an exceptionally violent rally from extreme oversold conditions followed by a consolidation period as the dollar bounces weakly out of its intermediate bottom and rolls over quickly signaling that the three year cycle has topped.”  Gold Scents

Americans, enjoy your 4th of July holiday.  I do plan to have a post up for the Canadian and Europeans.  Fun in the sun aside, Thursday and Friday promise to be big market days stateside.

Goldbugs, TA and Stragglers

I do believe the safe route to profit from the gold exploration cycle is Franco-Nevada.  FNV has a deep portfolio of royalty rights and the cash to invest in additional juniors prospects at favorable prices.  Junior Gold Exploration at Zeal.  Seven arguments for gold stocks:  Casey Research.

Fed heads Lockhart and Dudley are open to more easing.  As for Friday’s face ripper, I have not even tried to understand the European news:  Sober Look.  What I do know is policy makers will actively choose to debase or society will default.  Bill gross seems to be thinking inflate or default at Pimco.  More irreverent is Jim Willie.

Bottom calling:  The CRB Just Formed A Final Three Year Cycle LowToby Connor.  Treasury’s vs CRB:  Stockcharts.  I see The Classic Failed Breakdown Trap in copper too:  Stock Sage.  Transports look good:  All Star Charts.  Long term price/earnings ratio:  Chart of the Day.

Meanwhile, US Global Trade Forecast to Grow 4.7 Percent at JOC.  And this decade will be the most innovative in history at VB.

Precious Economics

Precious Metals:  Keep it Simple at Daily Gold.

From The Worldwide QI Quagmire at Testosterone Pit:  “ZIRP and QE have had another effect, one that is starting to be very costly: misallocation and subsequent destruction of capital.”  I’ll go further and say all intervention props up malinvestment.

Thus Fiat Money Kills Productivity at Azizonomics.

Meanwhile, Krugman publicly calls for help and unity in the quest to debase to prosperity:  Business Insider.

Econonic Data Has Not Been Very GoodRitholtz.  World GDP chart:  Ritholtz.

Easy Recession

The decreasing impact of QE’s:  Ritholtz  Yet Bernanke paved the way for QE3 on August 1st according to Calculated Risk, but here are some different views at Calculated Risk.

Maybe oil is the early warning signal:  Zerohedge.  “…U.S. recession that, by our estimates, has already begun.” from John Hussman

Meanwhile, respected mainstream economist Paul Krugman screams for more intervention:  New York Times

Further, you’ve heard of the fiscal cliff, here is the monetary ledge:  Yardeni

How about across the pond, what’s the ECB thinking?  Economist  There are rumors of $2.5 trillion fire hose:  Business Insider

Dummies guide to what went wrong in Europe:  Investor Village

Quality analysis of Barrick (ABX) at Seeking Alpha.

Goldbug Central

Gold Stock Valuations at Zeal.

Note the deflationary period in Weimar marks relating to gold:  Casey Research.

About this gold consolidation since last August:  Kimble Charting Solutions.  A forty year silver chart with its recent consolidation:  Kimble Charting Solutions.  Platinum to gold ratio:  Bespoke.

The credit bubble, of course, drives the fantastic gold fundamentals.  Prior to the financial crisis, housing was the largest driver.  I continue to observe decent low middle income housing being in shortage, mortgage rates being suppressed and McMansion pricing pressure.  The housing market is not so bad out there, let’s check in:

  • He chronicled the housing bubble, now a February explanation of the two bottoms:  Calculated Risk.
  • So Housing is Local…  at Value Plays
  • Fannie Mae expects some GDP growth from housing, finallyHousingwire
  • US housing: shadow supply meets shadow demand:  Sober Look

Since the financial crises, debt sponsored by sovereigns has been driving the credit bubble bus.  Here is a chart of the disasters in the West:  Chart of the Day.  (Note how much runway China has in front of themselves.)

Precious Fix

Ridiculousness continues:  Multi-trillion plan to save the eurozone being prepared at The Telegraph.  State pensions will be papered over imo:  Financial Sense.

Fleckenstein – Fed Takes Half Step, Will Be Forced to Act Again at King World NewsA visible slowdown in global economic activity at Sober Look.

Prepare for the Pivot Point in the Gold Exploration Cycle The Gold Report.  If so, Franco-Nevada would be the bluest of blue chips with their perpetual call option upside.  The occasional junior would explode, senior producers would do fine, SLW and RGLD would be good, but FNV would be best.  If the thesis is correct.

The trader goldbugs love to hate, Dennis Gartman:  “Buy Miners, Not the Metal” at Money News.  Today doesn’t look so good, but are Gold Miners Poised to Rally?  Stock Sage.

But which way?  Gold and Silver on the Verge of Something Huge! – Are You Ready?  Safe Haven

Goldbug Saturday

“Bereft of the modern printing press, the Romans resorted to clipping their metal coins, a practice most prevalent during the reign of their infamously pyromaniacal emperor, Nero. The idea was simple enough: Boss Man calls in ten coins…then reissues eleven, fashioned out of the same amount of metal. And, voilà! Wealth has increased by 10%! The scam here is obvious…except to the credulous acolytes of modern finance.”  Daily Reckoning

Perpetual QE Has Arrived:  “Unless the Fed is Actively Engaging in monetization at every given moment, the impact from easing diminishes progressively, ultimately approaching zero and subsequently becoming negative!”  And this was written prior to ‘preparing to interveen’ talk of Thursday and Friday at Zero Hedge.

But this fellow says Current Account, Inflation & Jobless Claims Not Enough For QE3 & Twist Pressure at 24/7 Wall Street.

“There hasn’t been a case in history where they haven’t eventually printed money and devalued their currency.” – Ray Dalio (AA)  [Cliff Comment: The inflation from money printing might not occur rapidly enough to prevent a deflationary financial system disastrous collapse.]”  Cliff Kule

Cheap gold stock commentary Adam Hamilton at Zeal.

Gold chart at Seasonal Charts with a hat tip to 3.58 at Investor Village.

S&P 500 inverse head & shoulders breakout:  This is How Bottoms are Formed from All Star Charts and another from Market Anthropology.

Easy Easing?

Endless QE? $6 trillion and counting  Reuters

Easing Seems Likely, But of What Form?  Financial Sense

One British central banker say bond buying should be expanded:  Bank of England should buy company loans at Reuters.

Re-reading Bernanke’s playbook:  Business Insider

A United States Representative to Congress “has offered his own $804 billion jobs plan that calls on the federal government  to hire the nation’s 15 million unemployed Americans for jobs paying roughly  $40,000 each, and bail out all the states and cities facing budget crises.”  You can’t make this stuff up.  It is dated from last fall, but it is real.  And if the credit bubble is going to be debased, it’s only the beginning.  Fox News

Have a Golden Plan from ChessNwine.  Gold technical analysis from last week:  Decision Point

Goldbug Saturday Morning Coffee

All roads in Europe lead to gold:  Chris Martenson.  Bernanke and the data disappointed the goldbugs at Global Macro Monitor, but Gold reversed higher on Friday at Daily Gold.

Have Gold, Silver, and Mining Stocks Bottomed?  Minyanville

“Under this scenario, the Fed would work in conjunction with Congress to stimulate demand by getting cash in the hands of households. This can be done through tax cuts, or as Milton Friedman famously suggested, a “helicopter drop” of money. Bernanke explains: “A broad-based tax cut, for example, accommodated by a program of open-market purchases to alleviate any tendency for interest rates to increase, would almost certainly be an effective stimulant to consumption and hence to prices. Even if households decided not to increase consumption but instead re-balanced their portfolios by using their extra cash to acquire real and financial assets, the resulting increase in asset values would lower the cost of capital and improve the balance sheet positions of potential borrowers. A money-financed tax cut is essentially equivalent to Milton Friedman’s famous “helicopter drop” of money.”  Street Insider

You will be shocked at a comparison of gold, stock and treasury returns over the past two years:  Ritholtz  Gold chart for 200 hundred years:  Chart Store.  Long term dollar chart at Kimble Charting.

Adam Hamilton thinks the dollar is in trouble at Zeal.  The Dow:Gold ratio is headed to a 1:1 ratio, the path with be interesting.  Safe Haven

Easy Edition

Last night Australian rates were cut to 3.5% on China concerns, shares rallied as more cuts are expected.  The Australian  This morning the Bank of Canada held rates steady at 1%.  Financial Post

Time for the Draghi and Bernanke puts?  Humble Student of the Markets  The time has come, Mr. Bernanke!  Sy Harding  Dennis Gartmans says 100% chance of further Fed easing at CNBC.  Goldman, Morgan, and B of A all think it’s coming according to Business Insider.  Looks like the Europeans are having meetings, Fed heads have speeches with Bernanke testifying Thursday.  Meanwhile, government budget deficits approaching 10% of GDP are not enough, more is required to keep the deflation boogeyman at bay on Bloomberg.  Steve Liesman thinks somebody should create a $2 or $3 trillion fund at CNBC.  The Fed’s Fisher questions the need for more action, but he doesn’t get to vote via Reuters.

Greg Weldon on the Solution Illusion at John Mauldin.

Be careful out there.  Trillions being bandied about by mainstream journalists?  We don’t know the path ahead…

Goldbugs

After the gold stock 900 basis point out performance last Friday, what’s another 150 between friends?

“Friday was the confirmation of the bear trap.”  Peter Brandt

David Einhorn Mocks Warren Buffet’s Stance on Gold:  Wall St. Cheat Sheet

Click through for some great stuff from Grant Williams in Things that make you go hmmm…Zero Hedge

The History of Gold:  Visual Capitalist

Remember, energy is 25% of the operating costs in gold mining:  24hhold

Goldbug Delight

Yesterday the gold equities outperformed the S&P 500 by over 900 basis points.  The stock market was clobbered and the precious metal complex spiked and then continued to rally.  The drivers were the some poor overseas economic reports, punctuated by the jobs report disaster stateside.  The realization occurred stimulus is closer at hand, and printing is the main option.

The race to the bottom is accelerating.  Japan considers yen intervention at 24/7 Wall Street.  Brazil cut rates via Marketwatch.  Remember when Central Banks would raise rates to defend the currency?  Denmark cut twice in two weeks to defend the currency (WSJ).  India has a lot of problems at Business Insider.  China looks for targeted stimulus at Reuters.  Must the Fed and European problems be noted too?

Global Gold Mining Trends by Scott Wright at Zeal.

Richard Russell at Financial Sense.  Gold in Euro’s, prior to yesterday:  Robert Sinn  The generalists misunderstand gold and goldbugs as people:  Reformed Broker.

Did gold just declare its next $250 move?  Peter Brandt  More technical analysis by chessNwine.