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Here Comes Cheaper Oil: Why Prices Are Set to Fall

Posted on 21 August 2014 by VRS  |  Email |Print

I learned from Art Laffer that government is the 800lb gorilla in the economy and that investors can profit from changes in government policies. But a practitioner has to accept the framework – that government policies drive incentives as much or more than any other single driver. The charts that follow should prove that out.
They show how a proposed change to the RFS ethanol mandate drove corn prices down 30% almost instantaneously. Similarly, in 2008, oil prices plunged at the mere suggestion that a moratorium against drilling on the outer continental shelf (OCS) might end………………………………………..Full Article: Source

Why Silver Prices Could Easily Double Or Triple

Posted on 21 August 2014 by VRS  |  Email |Print

Jim Rogers once quipped that he waits to invest until “there’s a pile of money just sitting there in a corner and I can walk over and pick it up.” In other words, an asset that’s deeply undervalued, widely ignored, with potent fundamentals ready to kick in. Is there such an opportunity in any of the precious metals right now?
One could make a case for all of them, given the likelihood of high inflation and the mainstream largely ignoring the industry. But there’s one metal in particular that I think will deliver the most fireworks………………………………………….Full Article: Source

Why You Should Buy Silver Before It’s Too Late

Posted on 20 August 2014 by VRS  |  Email |Print

Too often silver falls in the shadow of its flashy, favored cousin gold, but the precious metal grabbed headlines last week when a 117-year-old tradition came to an end. Until last week, the price of silver had been decided, or “fixed,” each day at noon in London by representatives from three different banks. The process was conducted in private and it was all very secretive.
Now, regulators have finally dragged the silver “fix” into the 21st century in an effort to improve transparency and reduce the risk of price manipulation. The new system, called the London Silver Price, is run by CME Group and Thomson Reuters. It uses trading on the over-the-counter market and determines the price through an algorithm………………………………………..Full Article: Source

Why Chinese Citizens Invest In Gold

Posted on 19 August 2014 by VRS  |  Email |Print

The US$ price of gold has soared +377% from 2001 to date. That’s a compound annual growth rate (CAGR) equal to 13.4%. Contrast gold’s monumental appreciation with the pathetic performance of the Shanghai Stock Exchange Index and the miserly return of US Treasuries.
“A major report published recently by the World Gold Council, “China’s Gold Market: Progress And Prospects” suggests that private sector demand for gold in China is set to increase from the current level of 1,132 tonnes per year to at least 1,350 tonnes by 2017. Following the record level of Chinese demand in 2013, which saw the country become the world’s largest gold market, the report suggests that while 2014 is likely to see consolidation, the succeeding years are likely to see sustained growth………………………………………..Full Article: Source

3 Reasons Why I Am Bullish on Silver

Posted on 19 August 2014 by VRS  |  Email |Print

Global stock markets continued to be wracked by rising volatility because of a range of economic and geopolitical events that are fueling greater concern among investors. This is generating renewed interest in precious metals, including gold, silver, and platinum, as investors seek safe-haven investments to avoid this volatility.
Economic and geopolitical crises are gripping the globe. Earlier this year, emerging markets plunged as the Argentine peso was sold off; now Argentina has defaulted yet again on its debt, and there is growing concern that Portugal’s banking system is nearing collapse………………………………………..Full Article: Source

7 Reasons to Like Silver

Posted on 19 August 2014 by VRS  |  Email |Print

When considering the catalysts for silver, let’s first ignore short-term factors such as net short/long positions, fluctuations in weekly ETF holdings, or the latest open interest. Data like these fluctuate regularly and rarely have long-term bearing on the price of silver.
I’m more interested in the big-picture forces that could impact silver over the next several years. The most significant force, of course, is what I stated above: governments’ abuse of “financial heroin” that will inevitably lead to a currency crisis in many countries around the world, pushing silver and gold to record levels………………………………………..Full Article: Source

Commodities are flashing a warning sign

Posted on 18 August 2014 by VRS  |  Email |Print

Commodities have been getting crunched and I believe it has rather serious implications for both the global economy and worldwide monetary policies. The withering of commodity-based price increases is likely to have a significant impact on headline inflation.
Oil is dropping particularly hard, but copper is at multi-month lows; agriculture commodities such as corn, wheat and soybeans have tumbled and broad-based commodity indices are on their backs………………………………………..Full Article: Source

Why Oil Prices That “Should” Be Going Higher Are Going Lower

Posted on 18 August 2014 by VRS  |  Email |Print

The world has changed. Even two years ago, with a war going on by proxy between Russia and Ukraine, we’d have seen a ten dollar rally in the price of crude, not prices below $97, like we’re seeing today. Add to that the Iraq crisis in the North, the continuing Syrian conflict, the destabilization in the oil producing countries of Libya and Egypt and you’d have been shocked - at least in 2011 - to see prices go decisively under $100 a barrel and act badly there. What’s going on here?
One long-term trend in the oil market and one very short-term trend have made the difference between a price that ’should’ be higher, but is in fact going lower. We need to really understand those changes to track where oil prices will go next and where those underlying oil stocks are headed………………………………………..Full Article: Source

Concerns Remain Ahead of New Silver Benchmark Debut

Posted on 15 August 2014 by VRS  |  Email |Print

With the unveiling of London’s shiny, new silver benchmark Friday, metal producers and traders are hoping to head off lingering concerns about the credibility of the market. But as the price-setting process undergoes the first major overhaul in more than a century, there are signs the revamped process isn’t quite ready.
“The overall impression I get from this is that everyone is a little unsure of how it’s all going to work—just because it’s something new,” said David Govett, head of precious metals at brokerage firm Marex Spectron. “The bullion market is quite a staid market, shall we say, and a lot of the people in it, especially the traders, have been around for a long old time.”……………………………………….Full Article: Source

Citi: Cost Cuts Help Gold Names Now, But Trouble Looms

Posted on 14 August 2014 by VRS  |  Email |Print

Citigroup’s Johann Steyn and Craig Irwin have a note out today, adjusting their gold outlook to reflect industry trends, but they remain bearish on the sector overall. They note that global gold on mine unit costs fell 5% year-over year, while notional cash expenditure fell 24% and all-in costs dropped 23% in the March 2014 quarter.
Clearly, austerity moves have helped gold firms navigate through a lower price environment, and Steyn and Irwin estimate that only 40% of the global gold cost curve is burning through cash, nearly half the 75% in the March 2013 quarter………………………………………..Full Article: Source

Gold going to $5,000 per ounce: Mining executive

Posted on 14 August 2014 by VRS  |  Email |Print

While the exchange-traded fund covering gold miners is outperforming the precious metal itself, McEwen Mining founder and chief owner Robert McEwen said Wednesday that he remains bullish on gold.
“I’m a long term believer in gold and I see it ultimately getting to $5,000 an ounce,” McEwen said on CNBC’s “Fast Money.” “Anything short of that, I wouldn’t be hedging.” McEwen, who owns 25 percent of his company and receives no salary, said that he expects gold to hit his price target of $5,000 in the next three to four years………………………………………..Full Article: Source

Confused by the new London silver fix? You should be!

Posted on 14 August 2014 by VRS  |  Email |Print

The silver market has cause for concern… This Friday sees Thomson Reuters and CME roll-out of their new fixing engine and market participants are understandably clueless about how it works less than three days before it goes live. With the traditional fixing members have stepping away, it remains a mystery who will be taking the fix orders - with a deafening silence from market participants.
Oddly, if you can identify who your orders are to go through, then you have to get the calculator out because Reuters advise that prices are no longer in US dollars per ounce but US dollars per “lakh” or 100,000 ounces … why ?……………………………………….Full Article: Source

Laif Meidell: Multiple currents at play in commodities

Posted on 13 August 2014 by VRS  |  Email |Print

Many times, we see that the top-performing commodities on our list will tend to follow a similar theme, such as agricultural commodities, precious metals or energy. Typically driven by similar macro-economic forces, similar commodity types quite often behave like “birds of a feather.” However, this week is a little different, with the top three commodities coming from three distinctly different commodity types.
This seems to indicate that in today’s financial landscape there is no one or two major themes influencing the commodity markets, but instead multiple currents and crosscurrents at play whether they be geopolitical, weather related or economic………………………………..Full Article: Source

Why is the gold price immune to global strife?

Posted on 13 August 2014 by VRS  |  Email |Print

Gold has been trapped in a narrow range over $1,300 per ounce, struggling to extend its rally, even as a whole raft of geopolitical tensions remain unresolved.
The yellow metal has failed to “find the vigor usually associated with rising fear,” according to analysts, even as U.S. forces carried out air strikes in Iraq, and NATO warned of the “high probability” of a Russian invasion of Ukraine Monday. Indeed, known holdings of gold by exchange-traded funds remaining close to its lowest point this year………………………………..Full Article: Source

Top 7 Reasons I’m Buying Silver Now

Posted on 12 August 2014 by VRS  |  Email |Print

I remember my first drug high. No, it wasn’t from a shady deal made with a seedy character in a bad part of town. I was in the hospital, recovering from surgery, and while I wasn’t in a lot of pain, the nurse suggested something to help me sleep better. I didn’t really think I needed it-but within seconds of that needle puncturing my skin, I WAS IN HEAVEN.
The euphoria that struck my brain was indescribable. The fluid coursing through my veins was so powerful I’ve never forgotten it. I can easily see why people get hooked on drugs……………………………………Full Article: Source

Gold hold on to overnight gains above $1,300 as Ukraine boosts safe-haven appeal

Posted on 08 August 2014 by VRS  |  Email |Print

Gold held on to overnight gains above $1,300 on Thursday, trading near its highest in more than a week as fears of Russian military action against Ukraine and retaliation by Moscow over Western sanctions burnished gold’s appeal as a safe haven.
Russia will ban all imports of food from the United States and all fruit and vegetables from Europe, the state news agency reported on Wednesday, even as NATO said Russia had massed around 20,000 combat-ready troops on Ukraine’s border………………………………………..Full Article: Source

What do Indian gold market changes mean for U.S. price?

Posted on 08 August 2014 by VRS  |  Email |Print

We are soon entering a propitious period for gold in the annual calendar. Historically, prices have moved higher as gold traders and buyers returned from their summer holidays. In reality, it has been the approaching Indian holiday, wedding, and agricultural harvest seasons that have boosted gold demand and supported higher prices in world markets as summer draws to a close.
Until last year, India was the largest consumer of gold in the world market, but thanks to the imposition of gold-import barriers by the Indian authorities and the surge in Chinese demand, China rose to the top spot and India trailed behind. Nevertheless, India remains a major player holding much sway over the world price………………………………………..Full Article: Source

Gold and Silver - From Price Manipulation to Hyperinflation

Posted on 08 August 2014 by VRS  |  Email |Print

The precious metals are lynch pins. They are nagging and persistent counter-parties to money printing gone wild. It’s been this way for as long as commerce was semi-civilized. (Though given the amount of financial fraud, violence, and chaos in the world, the term “civilized” might need to be reconsidered)…
When prices began to fly, the point of no return will be long since passed. I believe we are living in limbo at the moment. We’ve passed the point of return, but have yet to move into the next (collective) phase………………………………………..Full Article: Source

Jim Rogers: ‘If War Breaks Out, Play Commodities’

Posted on 06 August 2014 by VRS  |  Email |Print

If war breaks out, then what you play is gold, oil, commodities, etc. War is not good for anything except for real assets because people need real assets during the time of war - whether they are involved in the war or just protecting themselves. Other than that, I do not see any of this being good for anybody or anything.
Natural gas prices are very low. They are down 60-70 per cent from their all-time high. There has been a glut in the US in a way where the prices have been set on the futures exchanges. That glut is probably not going to last much longer, so I would suspect that natural gas is a good bet for people to start looking for investments………………………………………..Full Article: Source

Silver: The Rallies Are Getting Smaller And Smaller

Posted on 06 August 2014 by VRS  |  Email |Print

Silver’s nearly 15% rally from the first week of June that took it from a low of $18.75 to a high of about $21.50 appears to have ended. Silver has given up about half of those gains and is currently trying to hold the $20 mark. Back in the glory days of silver’s bull market (pre-2012), silver had large rallies that easily exceeded the most recent 15% run-up.
There is still some negative psychology in the precious metals market. Fundamentals for silver don’t seem to matter, at least in the short-term. The hedge funds are still overbought according to the COT report………………………………………..Full Article: Source

The Oil Market’s Next Crisis

Posted on 05 August 2014 by VRS  |  Email |Print

I’m glad I’m not in OPEC members’ sweaty Gucci loafers right now. Sure, it must be nice to be an oil gazillionaire. But consider the problems. Oil production from OPEC members is down all over the place. Libya still hasn’t recovered from its 2011 uprising. It’s exporting only a third of the 1.4 million barrels per day (bpd) of oil that it could produce at full capacity. A Sunni uprising in Iraq threatens that country’s oil production.
OPEC doesn’t expect production to recover anytime soon. It says non-OPEC producers would have to step up and meet increasing oil demand. Here’s the thing: OPEC has another cause for concern. One that wasn’t in its recent forecast………………………………………..Full Article: Source

Gold outlook grim, but don’t take your eyes off it

Posted on 05 August 2014 by VRS  |  Email |Print

Upbeat manufacturing data from China notwithstanding, all commodities have been exhibiting price volatility. In line with this, gold saw the third weekly drop, the longest streak of decline since September, amid speculation that an improvement in the US labour market will reduce investor appetite for the yellow metal, considered a safe haven. On August 1, gold traded in the international spot market near the lowest point in six weeks at $1,284 a troy ounce.
Normally, major events like a war or a terrorist attack lead to a spike in inflation as supply of certain goods (crude oil, for example) gets disrupted, increasing their demand. Going by the same logic, rising geopolitical uncertainties — be it in Ukraine or West Asia — is a fertile ground for gold. The metal sees a price spurt in such times because of safe haven demand and also because its price constantly gets adjusted to inflation………………………………………..Full Article: Source

Commodities slipping down the asset class league table

Posted on 04 August 2014 by VRS  |  Email |Print

Commodities have slipped further down the league table of asset class performance over the past week. The destruction in returns during July has been concentrated in the agricultural and energy sectors. In the event of signs of a further acceleration in US economic activity, Deutsche Bank expect precious metal returns will be the next commodity sector to suffer declines.
Energy: The rapid decline in crude oil inventories at Cushing helps to explain the tightness in WTI fundamentals. However, this inventory drawdown may draw to a close after the summer as pipeline infrastructure starts bringing additional crude into Cushing. Meanwhile, weak physical demand for crude oil has trumped geopolitical risks and facilitated a recovery in refinery margins in the US Gulf Coast and Northwest Europe………………………………………..Full Article: Source

Why Did Ron Paul Say Gold Could Go To Infinity?

Posted on 04 August 2014 by VRS  |  Email |Print

This week, former Congressman Ron Paul said gold could go to infinity. Many people will be tempted to buy gold based on his prediction. It’s certainly exciting to think about the upside, the profit potential. Who doesn’t want to buy whatever’s going up? However, in the case of gold, there is a serious error in this thinking.
Dr. Paul has put his finger on something very important. The government is abusing its credit, and borrowing itself into oblivion. If this continues, then the value of the government’s debt and currency will drop, probably quite rapidly. This means the price of gold will skyrocket………………………………………..Full Article: Source

Is the Fed Cornered? Here’s What Gold’s Price Says

Posted on 01 August 2014 by VRS  |  Email |Print

Step away from monetary-policy details and you’ll see that the Fed is in a conundrum. Economic data is improving. Policy is still ultra-loose. How does the Federal Reserve get from post-crisis mode to something more conventional?
Judging by the attached chart, the gold-price reaction to this morning’s 8:30 a.m. economic data suggests the question is top of mind for at least some traders. If it weren’t, gold’s price might be expected to be on the rise amid Thursday’s tone of worry. Dow futures are falling 118 points. Argentina is on the brink of default. European markets fell by a good 1% nearly across the board………………………………………..Full Article: Source

Investors not enthused by improving health of Commodities: Barclays

Posted on 31 July 2014 by VRS  |  Email |Print

A Barclays report says the current year witnessed an improvement in the health of commodities but investors have continued to withdraw assets from commodity investments on a quarterly basis. The slow pace at which institutional investors are able to take and implement the kind of long-term investment decisions and make allocations to commodities is the major reason for this trend. But the situation is expected to improve gradually, the report said.
The report maintains key recommendations as: long crude oil; short gold (due to weak fundamentals); and long nickel – the base metal with the best short-term fundamentals and a sector likely to benefit from better global growth in this quarter………………………………………..Full Article: Source

Hold some gold. Better safe than sorry

Posted on 31 July 2014 by VRS  |  Email |Print

The one sided drivel which passes for objective news reporting in the West never ceases to amaze me. On Ukraine, and in particular on the shooting down of Malaysian airlines flight MH17, the western media seem to promote one agenda, and one agenda only, without any recognition at all that there might be an alternative argument viewed from the ‘other side’.
Now whether it is proven that the anti-Russian rhetoric thus encompassed is correct or not surely a wholly impartial news organisation should at least recognise that there could perhaps be another side to the story………………………………………..Full Article: Source

Energy Economist: The amount of oil the world uses, seen through different eyes

Posted on 30 July 2014 by VRS  |  Email |Print

How much oil does the world consume? You’d think this would be a fairly straightforward question, given its economic importance to the world economy, and indeed answers are not hard to find. The problem is those answers differ significantly. Even with the development of the Joint Organisations Data Initiative–an evolving beast designed to bring improved transparency to oil markets–oil market data remains messy, inaccurate and opaque.
For 2013, a year which by now should be transitioning from estimate to a matter of historical record, OPEC puts world demand at 90.00 million b/d, the International Energy Agency at 91.40 million b/d and the US Energy Information Administration at 90.49 million b/d. The difference is large in absolute terms–1.4 million b/d between the IEA and OPEC–but small if viewed in percentage terms, about 1.5% of the total market………………………………………..Full Article: Source

We’re Ready to Profit in the Coming Gold Price Correction—Are You?

Posted on 30 July 2014 by VRS  |  Email |Print

Sometimes I see an important economic or geopolitical event in screaming headlines and think: “That’s bullish for gold.” Or: “That’s bad news for copper.” But then metals prices move in the opposite direction from the one I was expecting. Doug Casey always tells us not to worry about the short-term fluctuations, but it’s still frustrating, and I find myself wondering why the price moved the way it did.
As investors we’re all affected by surges and sell-offs in the investments that we own, so I want to understand. Take gold, for example. Oftentimes we find that it seems to tease us with a nice run-up, only to give a big chunk of the gains back the next week. And so it goes, up and down………………………………………….Full Article: Source

Forecasts for higher oil prices misjudge the shale boom: Kemp

Posted on 29 July 2014 by VRS  |  Email |Print

“The world of energy may have changed forever,” according to Professor James Hamilton of the University of California. “Hundred dollar oil is here to stay.” Hamilton, who is one of the most respected economists writing about oil, made his bold prediction in a paper on “The Changing Face of World Oil Markets”, published on July 20.
“Old hands in the oil patch may view recent developments as a continuation of the same old story, wondering if the high prices of the last decade will prove another transient cycle with which technological advances will eventually catch up,” he wrote. “But there have been dramatic changes over the last decade that could mark a major turning point.”……………………………………….Full Article: Source

Should you jump on the silver bandwagon?

Posted on 29 July 2014 by VRS  |  Email |Print

After rising nearly 12% from its June lows, silver has been garnering some attention lately, leaving many investors wondering whether they should raise their allocations to the precious metal. Russ explains why now probably isn’t the best time to allocate more to either silver or gold.
After rising nearly 12% from its June lows, silver (SLV) has been garnering some attention in recent weeks, as investors and market watchers look for something to get excited about amid the broader market’s low volatility and slow grind higher. It’s no wonder, then, that many are asking whether it’s time to jump on the silver bandwagon………………………………………..Full Article: Source

Stephanie Flanders: Now is the time to invest in commodity stocks

Posted on 25 July 2014 by VRS  |  Email |Print

Stephanie Flanders, chief market strategist at JP Morgan Asset Management, believes that now is the time for investors to back commodity companies. She commented that while ‘it is too early’ to call the bottom of the commodity cycle, commodity stocks should still play an increasing role in investors’ portfolios because of the diversification they offer.
Flanders noted that 2014 has seen strong returns for commodities, with the Bloomberg/UBS Commodity Index having returned 7.1 per cent so far this year………………………………………..Full Article: Source

Gold: If The Worst Is Over, What’s Next?

Posted on 24 July 2014 by VRS  |  Email |Print

1. A number of top bank economists have turned bullish on gold in the past few months. That’s helping to boost confidence amongst thousands of Western gold community investors.
2. Scotiabank and HSBC have lead the way on that front, and now top metals strategist Mike Widmer at Merrill Lynch has thrown his weight behind the bulls as well………………………………………..Full Article: Source

Commodity markets rattled by Ukraine airplane disaster

Posted on 21 July 2014 by VRS  |  Email |Print

Global commodity markets were gripped this week by the Malaysian air crash, which has dramatically raised tensions between Russia — a key producer of many raw materials — and the West. The doomed Malaysia Airlines MH17 flight, which crashed killing 298 people on Thursday, was “likely downed” by a surface-to-air missile fired from separatist-held eastern Ukraine, a US envoy said on Friday.
Investor sentiment was already hit by broadened US sanctions on Russian energy, defence and financial firms to punish what Washington charges are violations of Ukraine´s sovereignty.”If Russia turns out to have played any part in (Thursday´s) shooting down of a passenger plane over east Ukraine, there is a risk of sanctions being further tightened,” Commerzbank analysts said in a research note………………………………………..Full Article: Source

Do Or Die Time For Commodities

Posted on 17 July 2014 by VRS  |  Email |Print

It’s do or die time for commodities. In classic Stage Analysis what we’re seeing right now is a retest of a Stage 1 base that formed over multiple months in 2013. Commodities then broke out of that base in early 2014 but are now retesting the base which is typical in a Stage 2 uptrend.
This retest is kind of a mixed bag in my opinion, because agricultural commodities are acting extremely weak and putting in new lows. Energy is looking weak too. Precious and base metals are probably the strongest portions of the commodities complex currently. Which is interesting because they lagged at the beginning of the year and now they are leading………………………………………..Full Article: Source

Gold is still looking good – but watch this price level closely

Posted on 17 July 2014 by VRS  |  Email |Print

Just before New York’s opening bell on Monday somebody dumped 14,000 gold contracts onto the market. That’s 1.4 million ounces (a contract is 100 ounces), or $1.8bn worth – around a 65th of annual global production.
And it followed a 6,000-contract dump earlier in the day as markets opened in Europe. Is somebody trying to get the price down? Gold ended last week at $1,340 an ounce. Then, on Monday afternoon, it touched $1,302. That near-$40, 2.5% drop was its biggest daily plunge since December 2013 – the nadir (so far at least) of gold’s bear market………………………………………..Full Article: Source

Goldman thrives as commods rivals melt away

Posted on 16 July 2014 by VRS  |  Email |Print

Goldman Sachs’ commodities business, known for its muscular trading operation, is rapidly expanding in a plainer and less politically charged area even as listless markets and increased regulation force rivals to beat a retreat. Commodity finance is among the fastest-growing segments of Goldman’s commodities business, the bank’s executives said.
“The financing side of the equation has gone from being a sort of appendage to being a really major organ for us,” Greg Agran, Goldman’s global co-head of commodities trading, said. “When we think about growth going forward over the next few years, I actually think the commodity finance business is one of the areas we are most excited about”………………………………………..Full Article: Source

Is There A Silver Conspiracy?

Posted on 16 July 2014 by VRS  |  Email |Print

It’s now going on close to 30 years since I first discovered that silver was manipulated by excessive and concentrated short selling on the COMEX. I remember the exact moment like it occurred yesterday. It’s hard to believe I was in my 30’s when this started.
As I’ve explained previously, I was looking for an answer to Izzy Friedman’s question as to how and why silver prices remained so low when the market was in a supply/demand deficit………………………………………..Full Article: Source

What Wall Street Is Saying Gold Prices Will Do in the Second Half of 2014

Posted on 14 July 2014 by VRS  |  Email |Print

We here at TheStreet don’t claim to know where the gold price is headed tomorrow or next week, but we talk enough to the Wall Street pros to give you a sense of which direction the yellow metal is trending. The first half of 2014 was surprisingly strong for gold.
We say “surprisingly” because gold is coming off its worst full-year performance in more than three decades after a market crash in April 2013 fueled a 30% drop. But a drop of more than 9.5% from January through June of 2014 left many retail investors to wonder if the rise was a sign that $1,900 gold — where the market topped out in September 2011 after a decade-long bull run — was soon to return………………………………………..Full Article: Source

Gold And Commodities Outlook: Follow The Yellow Brick Road

Posted on 10 July 2014 by VRS  |  Email |Print

Over the years we’ve gravitated towards tracking the nuances in the precious metals sector, because they can be great leading indicators of some of the broader changes in the macro climate.
In 2011, we kept a close eye on silver and the silver:gold ratio, as it shot up its parabolic peak and exhausted in the indiscriminate risk blow-off that culminated at the end of April of that year. In 2012, we followed the sector lower as it made a tradable low at the end of Q2, but warned of the comparative differences between QE II and QE III that participants were drawing with the precious metals and commodity markets………………………………………..Full Article: Source

When and Why Do Gold Prices Plummet?

Posted on 08 July 2014 by VRS  |  Email |Print

The supply of gold is largely static from one period to the next. Gold mines are large and plentiful, but almost the entirety of what they produce is dross. As technology improves, ore with ever-lowering concentrations of gold becomes economically feasible. Ore that contains as little as one part of gold per 300,000 is worth mining.
Discard all the billions of tons of worthless ground rock, and it’s been estimated that all the gold ever mined would fit on a football field, piled less than 10 feet high. The gold mined each year adds less than the thickness of a coat of paint to the total……………………………………..Full Article: Source

Palladium prices hit 13-year highs as demand increases

Posted on 07 July 2014 by VRS  |  Email |Print

Palladium prices hit 13-year highs on Friday, driven by expectations that South African supply will remain constrained after a lengthy strike and that demand from Chinese and US carmakers will improve. Spot palladium hit a high of $865 an ounce, its highest since February 2001, and was up 0.9 per cent at $862.25 an ounce.
Holdings of palladium-backed exchange-traded funds - popular investment vehicles which issue securities backed by physical metal - have risen to a record 2.55 million ounces this week, suggesting investors’ appetite for the metal is firm………………………………………..Full Article: Source

Have Metals Finally Bottomed?

Posted on 07 July 2014 by VRS  |  Email |Print

I completely understand that you might think I am crazy for trying to call a bottom in the metals and mining sector. I probably am. Furthermore, I understand the “China slowdown” mindset very well. After all, the interesting fact has been how strong Chinese growth has been and how the country hasn’t experienced one simple recession yet (similar to Australia, where we have not had a technical recession in over 20 years).
Quite an amazing feat to be honest, but eventually we will have a mean reversion (in both countries). Personally, I have been expecting the negative surprise and even a potential recession to occur since late 2010. I rightfully warned my business partners against expanding the mining exploration company back in those days………………………………………..Full Article: Source

Now is the time to buy gold – Nichols

Posted on 04 July 2014 by VRS  |  Email |Print

One of the problems facing the potential gold investor who may see the longer term future of the precious metal as being decidedly positive, is when to actually step in and buy bullion, bullion related securities or gold stocks. Respected New York gold analyst, Jeff Nichols, feels that the time may well be now.
Nichols recommends holding a proportion (perhaps 5-10%) of one’s investment portfolio in physical gold, thus providing a variety of benefits – portfolio appreciation, diversification, reduced portfolio volatility, risk reduction, inflation protection, and more. Given that Nichols describes himself as not being a ‘gold-bug’ he does reckon to be ‘super-bullish’ on gold’s longer term prospects………………………………………..Full Article: Source

Gold rush: Is it really worth investing in?

Posted on 03 July 2014 by VRS  |  Email |Print

Gold is generally seen as a safe haven during periods of high inflation. As inflation increases, the value of money decreases and the prices of all goods increase. People prefer to hold gold instead of cash during these periods as gold acts as a retainer of value for them.
Traditional theory states that prices of real assets such as gold does not change permanently in times of high inflation but changes proportionately with the rate of inflation………………………………………..Full Article: Source

Silver Short Squeeze Presents New Opportunity

Posted on 27 June 2014 by VRS  |  Email |Print

A short squeeze in the silver market is pushing prices profoundly higher, the consequence of which could be felt for years. All told, the month of June has witnessed silver rise by over 12%. But the truly aggressive price action began exactly a week ago – with a single-day move from $19.81 to nearly $21.
Short squeezes occur when short sellers close their positions with a heightened sense of purpose and haste. Such behavior can cause prices to move sharply higher. That is, since closing a short position requires one to buy shares………………………………………..Full Article: Source

Blame the media for gold’s decline: Marc Faber

Posted on 18 June 2014 by VRS  |  Email |Print

Investors who favor gold have provided many reasons for gold’s nearly 30 percent decline in 2013 and overall demolition since it hit $1,934 in September 2011. But on CNBC’s “Futures Now,” noted investor Marc Faber provided an especially interesting one.
Investors are shunning gold “because the media doesn’t like gold,” Faber said by phone Tuesday from Thailand. “Nobody at CNBC owns gold. Nobody at Bloomberg owns gold. Gold is being constantly talked down by the media, and Fed officials, and economists, who also don’t own any gold. They’re all stocked up in equities.”……………………………………….Full Article: Source

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Is Silver Set Up For A Huge Short Squeeze?

Posted on 13 June 2014 by VRS  |  Email |Print

An interesting and rare set-up has developed in the Comex silver futures Commitment of Traders weekly position report (COT report). This is a report issued by the CFTC (Commodity Futures Trading Commission) which shows the long/short futures positions for various categories of traders.
The position report issued last Friday for Comex silver futures traders shows extreme positioning for both the “commercial” and “managed money” segments. In addition, there are signs of possible supply/demand stress for physical silver in China. As I will detail below, both indicators are indicative of a possible short squeeze developing in silver………………………………………..Full Article: Source

Gold Much Harder Sell, Palladium Looking Strong (Video)

Posted on 13 June 2014 by VRS  |  Email |Print

Which precious metal will most likely prevail this coming year? Palladium says Philip Newman, director of Metals Focus, to Kitco News at the IPMI Conference. “I think, in terms of palladium, the underlying supply-demand picture is very strong from a price point of view,” he says. “I think we’ll see gold and silver struggle relative to the PGMs.”
Newman says gold and silver prices will most likely remain range-bound for the next few months and even into early next year. “This year, we’re not seeing mass liquidations, that is really behind us, but at the same time we’re not seeing a great deal of net new demand from the investment community coming in.” ……………………………………….Full Article: Source

A Bear-Raid on Gold – Is that about to happen?

Posted on 11 June 2014 by VRS  |  Email |Print

After some considerable selling of gold from the SPDR gold Exchange Traded Fund in the preceding months, early in 2013, Goldman Sachs came out with a warning that the gold price was going to fall and fall heavily. It did after Goldman Sachs and JP Morgan Chase helped it down with a bear-raid. Thereafter, selling from the SPDR fund persisted throughout 2013.
But it became clear that this selling of physical gold provided an opportunity to ‘short gold’. Goldman Sachs along with JP Morgan Chase and their clients, followed through on their forecast and around mid-April 2013 plus/minus 400 tonnes of gold was dumped onto the market knocking the gold price down by $200 within a fortnight………………………………………..Full Article: Source

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