Here are a few new http://www.goldalert.com links to peruse:
Aug
31
Most people in the United States do not know where their money comes from. Most people do not even think about the fact that the piece of paper on which their money is printed is worth next to nothing. And most people do not know that until the 1970s, money was tied in some way to the gold price. It is not necessarily their fault for not knowing these items, although I believe it should be the responsibility of our educational system to teach everyone. Back when I was in school, I chose to take my first economics class because I wanted to learn about money. But it was an elective course rather than a requirement. I was surprised to learn that money in the US is created by the concept of fractional reserve lending, and that a private organization, called the Federal Reserve, is responsible for conducting the country’s monetary policy through various complicated mechanisms that are tied to the banking system within the United States.
Given the significant economic and financial events of the past several years, more and more Americans are learning how money is created. Unfortunately however, it has taken a severe financial crisis for this to occur, but this learning process is a very good thing nonetheless. The Federal Reserve has made great use of its ability to create money out of thin air with the simple click of button, now that it no longer is restricted based on the past relation to the gold price. It has expanded the money supply at an enormous rate to combat the deflationary impact of the blow up of the largest credit bubble in United States history.
The efforts of the Fed have been both praised and heavily criticized by many. Its supporters say that as the last resort in ensuring the stability of the financial system, the Fed has taken the necessary steps to support those financial institutions whose failure may have brought down the entire system. They go on to say that the Fed has been very creative and effective at supporting various credit markets that basically shut down in the fall of 2008. Its critics, on the other hand, say the Fed has completely overstepped their boundaries. They have overstepped their boundaries, chosen to save certain firms like AIG and Citigroup while letting others like Lehman Brothers fail, and expanded its balance sheet to ungodly and dangerous proportions. The critics go on to say that if a standard tied to the gold price were still in place, the Fed would not be able to perform these types of measures.
As with most things in life, the true most likely lies somewhere in the middle of these two extremes and it is not the point of this article to try to find the exact answer. Nevertheless, it is clear that the Fed’s extraordinary actions have had and will continue to have a very large impact on the monetary system in our country, and that there are some serious long term consequences of their unique and momentous actions, many of which will impact the gold price. Some of the most important consequences include the debasement of the US dollar, which the Fed does every time it prints more money. There are massive inflationary impacts of this money printing that will continue to put downward pressure on the dollar. And the dollar denominated gold price will respond accordingly, with an eventual large move to the upside to reflect how many more dollars are needed to equal an ounce of gold.
Only one form of currency has lasted throughout human history: gold. And many people are beginning to wonder if the US may have to eventually return to a monetary system tied to the gold price, given the recent actions of the Federal Reserve.
Source: www.goldlive.net
Aug
25
Gold price futures recovered much of yesterday’s losses (as of 9am Tuesday) as a weakening U.S. dollar raised the metal’s investment appeal. Copper futures declined from their highest level in nearly eleven months. December gold futures gained $8.60, or 0.9%, to $952.30 an ounce on the Comex division of the New York Mercantile Exchange. The contract had dropped more than 1% during Monday’s trading session. The market also received the reappointment of Ben Bernanke as chairman of the Federal Reserve Board quite well and sailed upward. It was widely expected that Bernanke would be in line for a second term as Fed chief has been quite the leader out of this recession. Strategists said signs the U.S. economy has bottomed out had helped solidify his reappointment since he has been sign as a driving force for recovery.
In regard to global currencies, the euro rose 0.2% against the dollar to $1.4325. The dollar index fell more than 0.2% to 78.101. Many analysts believe that such currency fluctuations will set the tone for the trading days ahead. Holdings in SPDR Gold Trust at 1,066.41 metric tons on Monday, unchanged from Tuesday. Among the other metals, August copper delivery dropped $0.0375, or 1.3%, to $2.8765 a pound. It had closed at $2.914 Monday, the highest settlement for a front-month contract since late September. Silver for September delivery gained 16.5 cents, or 1.2%, to $14.36 an ounce. The gold price continues to remain strong in this uncertain period of quantitative easing and investor caution.
Aug
19
This article explains and gives insight into how the financial credit crunch began. By first identifying the causes of the near depression, we can best find viable solutions for the future. The gold price can be used as a possible investment tool. Investors and legislators must work together in order to discover the path of least resistance on both sides. Wall Street will have to adapt to some of the many changes that forced them to close down multiple firms. These are not only recommendations for the present, but also standards that must be concrete in the future. The U.S. cannot afford another economic crisis in the near future.
By now everyone knows that the global financial system and economy are in a precarious position. The entire Wall Street landscape has changed, and economies all over the world are suffering from the worst recessions since the 1930s. Governments and central banks have taken on a very large role in trying to dampen the effects of the recession through massive Keynesian stimulus programs, record low interest rates, quantitative easing, and even accounting changes which allow banks more freedom to value illiquid assets in ways to preserve much needed cash.
While many might cheer and credit these efforts for the performance of global equity markets over the past five months, others are more concerned with the long term effects and consequences of such monumental actions. The National Debt is now approximately $11.6 trillion and growing every second due to interest on this ever growing mountain of debt. The US dollar index is down roughly 33% over the past ten years and given recent money printing efforts, this trend looks to continue.
Accordingly, it behooves any and all investors to consider going forward to try to determine which, if any, asset classes can provide sustainable growth over the long term. If history is any guide, it has shown that those areas formerly in a bubble rarely, if ever, recover to their bubble levels. Examples of this include tulips during the Tulip bubble, the Japanese stock market in the late 1980s, and the NASDAQ during the tech bubble. And now we have real estate and global equity markets during the credit bubble of 2003-2007.
As such, it appears that a new asset class with a strong fundamental story behind it would be a better candidate. Fortunately, gold satisfies these criteria. The gold price has proven over time to perform well in periods of high inflation (1970s) and high deflation (1930s).
Currently, the Federal Reserve is doing everything in its power to prevent a deflationary credit collapse by engaging in highly inflationary measures. If these measures are effective in stimulating lending, halting the rise in unemployment, and restoring consumer confidence, it will be the results of massive deficits and currency debasement, which will further devalue the US dollar and consequently send the dollar denominated gold price higher.
But a failure in these efforts will lead to a very challenging economic environment marked by fear and greater uncertainty. The situation could also become so challenging that people begin to question the soundness of the currency. In this case the value of most asset classes will decline and cause investors to seek out the one asset class that has stood the test of time as a currency: gold. The gold price and gold mining companies therefore look to be the main beneficiaries in either scenario.
Source: http://www.goldpriceblog.org
Aug
18
San Gold announced the results of its drilling program back in July and it was actually quite impressive. High grade gold for the hinge zones was found as the sloping mine grade was 0.63 gold ounces per ton to the mill. The main #1 lens stope contributed 0.77 gold ounces per ton. A total decline, lateral, and raise development of more than 8,000 feet has been completed. This is some of the highest grade gold that has ever been mined in the region. Since the grade is so high, less tons are necessary to satisfy the requirements of the economic feasibility study.
San Gold is on track to have cash costs of $158 per gold ounce. This will put the company below most of its competition, strictly in terms of cash costs. These cash costs are low due to the high grade. The key to the entire San Gold project is recognizing the high grade mineralization that is present at its Manitoba property. A resource estimate is expected quite soon. San Gold’s share price was up 87% year-to-date as of July 14. The gold price has certainly helped to bolster the SGR.TSXV share price.
Aug
12
The gold price moved up a bit mid-day to $951.17 (roughly 0.55%). This comes as a partial surprise because it has had a five day decline. However, the release of the FOMC meeting decision and notes will be crucial in mapping the next moves in the gold price. The FOMC is scheduled to announce its decision this afternoon. If interest rates increase, the dollar goes up and the gold price will most likely tumble. Hence, an indirect derivative of the gold price is interest rates. For the most part, the gold sector has been pretty quiet and appears to be waiting on the release of the FOMC report.
Aug
11
Long positions in traded gold price gained sharply recently and, due to the absence of physical buyers, that speculative trade makes it “increasingly dangerous to hold gold or enter the market at these levels,” said VTB Capital commodity analyst Andrey Kryuchenkov. The dollar was mildly weaker against the euro Tuesday but remained generally strong. European gold stocks were higher at the open. The market will watch the comments surrounding the U.S. Federal Reserve meeting beginning Tuesday with an interest rate decision due Wednesday. At 0848 GMT, spot gold price was trading at $947.35 a troy ounce, up 0.3% from Monday’s close. Spot silver was at $14.46/oz, up 1.1%. Spot platinum was at $1,250/oz, up 0.5%. Spot palladium was at $270/oz, down 0.7%. Longer term, Goldman Sachs said gold prices will remain around current high levels, consistent with a supportive low real-rate environment. The SPDR Gold Trust exchange traded fund holdings fell further, down 0.35 metric tons to 1,068.55 tons as of Aug. 10.
Aug
07
European central banks agreed to place a cap on total gold sales at 400 metric tons a year, with total sales over the five-year period capped at 2,000 metric tons. This does not directly address fluctuations in the gold price. The existing five-year agreement, which ends in September, capped annual sales at 500 metric tons and total sales at 2,500 metric tons. The new agreement therefor reduces the cap.
The IMF’s intention to sell 403 metric tons of gold will “be accommodated” within the ceiling, the central banks’ leaders said in a statement. The signatories also agreed to review the agreement after five years in the case the the investment environment changed. Central banks have already sharply reduced their gold sales in recent years. Signatories of the existing sales agreement are expected to sell 140 metric tons of gold this year, much lower than the annual cap, London-based precious metals consultancy said earlier this week. It will be the lowest level since 1994. Since 2005, the official cap has never been met.
This is good news for the gold price as security and stability are key in the market. If a country was able to dump large volume’s of gold on the market, the supply shock would decrease the gold price. For instance, the current IMF transaction accounts for nearly a sixth of mine production for a year. If gold sales were not limited, company earnings would lose meaning in relation to share price.
Aug
04
The gold price is continuing its rise and is already up to $965 for the day. As the dollar continues to be devalued by government actions, the gold price is set to jump. This is very good news for gold stocks as they depend on the gold price for revenues. I would recommend looking at gold stocks companies on the TSX that have a high propensity to return staggeringly high gains. A high gold price widens the revenue base and share prices can increases two-fold in a matter of months.
Jul
31
Even though the gold price experienced substantial gains yesterday, it had no issue further increasing. Near market close, the gold price had increased 20.5, or roughly 2.2%, to $955.11. This is due to news that the dollar is expected to further deflate. This also shows that positive signs in the GDP growth do not always correlate with the gold price. We can expect gold stocks to be quite bullish in the near future. Such increases in the gold price means that firms are able to increase their gold profits. In this case, the best position is to be unhedged assuming that the market consistently beats the hedge book.
Spot Gold Price 