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From The Gold Report:
“Half science, half art, half luck,” is how Brent Cook describes a geologist’s work in distinguishing an anomaly from a deposit. But in his interview with The Gold Report, the publisher of Exploration Insights suggests investors will have an easier time distinguishing good drill results from bad if they know how to dissect a company’s press releases. And despite the current preference for cost cutting over discovery, Cook discusses several miners whose futures are bright.
The Gold Report: After the Prospectors and Developers Association of Canada Convention in March, you said that the next 12–18 months could define how investors, speculators and mining companies perceive and value both the junior and major mining sectors. That was before the volatility of mid-April. With higher production costs being the new normal, what percentage of miners can make money at the current gold price?
Brent Cook: That is a tough call because companies use different methods to report their gold prices and gold costs. Cash costs are just one factor. When you throw in exploration, general and administrative expenses, royalties and such, it goes up quite a bit.
Everything I have seen published by both the companies and the analysts suggests that the all-in average cost of production for larger mining companies is…
More on gold stocks:
Top mining CEO: Get ready for lower gold and silver prices
Trader alert: A little-known “buy signal” has triggered in a huge number of gold stocks
What resource legend Rick Rule is doing with gold stocks now
Article source: http://www.thedailycrux.com/Post/42773/insider-tricks-from-a-top-gold-geologist
From Bloomberg:
A cheap regimen of vitamins in use fordecades is seen by scientists as a way to delay the start of Alzheimer’sdisease and dementia, a goal that prescription drugs have failed to achieve.
Drugmakers including Bristol-Myers SquibbCo., Pfizer Inc. (PFE) and Eli Lilly Co. (LLY) have spent billions ofdollars on ineffective therapies in a so-far fruitless effort to come up with atreatment for dementia and Alzheimer’s.
Now, in the latest of a steady drumbeat ofresearch that suggests diet, exercise and socializing remain patients’ besthope, a study published today in the Proceedings of the National Academy ofSciences shows that vitamins B6 and B12 combined with folic acid slowed atrophyof gray matter in brain areas affected by Alzheimer’s disease.
“You don’t have any other options forthese patients, so why not try giving them this cocktail of B vitamins?”says Johan Lokk, a professor and head physician in the geriatric department atKarolinska University Hospital Huddinge in Sweden, who wasn’t involved in thestudy.
Alzheimer’s disease and dementia mostlyaffect older people. As people live longer, the number afflicted by theconditions is growing. Delaying dementia with an inexpensive vitamin regimenmay help stem the surge in cases, which the World Health Organization predictedwould more than triple from 36 million worldwide in 2010 to 115 million in2050, as well as the cost, estimated at $604 billion in 2010 by Alzheimer’sDisease International.
Vitamin Market
Vitamin makers and retailers such as Pfizer’sconsumer health-care unit and GNC Holdings Inc. (GNC) in the U.S. and ReckittBenckiser Group Plc and Holland Barrett Holding Ltd. in Europe stand tobenefit. The Nutrition Business Journal estimates the global market forvitamins, minerals and supplements was $30 billion in 2012 and forecasts saleswill grow 3.6 percent by 2017.
In the PNAS study, researchers tracked 156people ages 70 and older who had mild memory loss and high levels of a proteinpreviously linked to dementia. Among people with elevated homocysteine, thestudy found that the amount of gray matter declined 5.2 percent in those takinga placebo, compared with 0.6 percent in those who took the vitamin cocktail.The supplements cost about 30 cents a day in pharmacies and health-food stores.
First Look
“It’s the first and onlydisease-modifying treatment that’s worked,” said A. David Smith, professoremeritus of pharmacology at Oxford University in England and senior author ofthe study. “We have proved the concept that you can modify the disease.”
The U.S. Food and Drug Administration hasn’tcleared new drugs for memory loss conditions in a decade. Approved medicinessuch as Eisai Co.’s Aricept ease symptoms without slowing or curing dementia. Ajoint U.S.-European Union task force in 2011 found that all disease-modifyingtreatments for Alzheimer’s in the previous decade failed late-stage trials “despiteenormous financial and scientific efforts.”
Since then, at least four more experimentaltreatments have failed. New York-based Bristol-Myers dropped development ofavagacestat in December after data showed the therapy wasn’t effective enoughto move into the final stage of testing. Solanezumab, from Indianapolis-basedLilly, failed to meet the main goal of two large studies last year, though thecompany plans to conduct further research.
Bapineuzumab from Pfizer, Johnson Johnson and Elan Corp. failed to improve patients’ memory or thinking,according to test results released in August. This month, Baxter InternationalInc. said Gammagard, which is used to help patients with immune disorders, didn’thelp Alzheimer’s patients in a late-stage study.
Meanwhile, scientists are exploring the useof experimental drugs to prevent Alzheimer’s. Independent trials will beginthis year and run for three to five years.
Shrinking Brains
Older people’s brains shrink about 0.5percent a year from the age of 60, and faster in people with vitamin B12deficiency, mild cognitive impairment or Alzheimer’s disease, Smith said. Ifthat pace can be significantly slowed before full-blown Alzheimer’s develops,it may delay the disease’s progression so that older people can enjoy betterlives until they die from another cause.
“If you delay the onset by five years,you can halve the number of people dying from it,” says Jess Smith, aresearch communications officer at the Alzheimer’s Society, a U.K. charity. Sheisn’t related to A. David Smith.
The Oxford group studied people in theOxford, England, area who had mild cognitive impairment, also known as MCI, orsome memory loss. One in six people over 70 have MCI and about half of thosedevelop dementia within five years, A. David Smith said. Alzheimer’s accountsfor 50 percent to 80 percent of all dementias, according to the Alzheimer’sAssociation.
Vitamin Cocktail
Study volunteers were given either aplacebo or 0.5 milligrams of vitamin B12, 20 milligrams of vitamin B6 and 0.8milligrams of folic acid. Their brains were scanned using magnetic-resonanceimaging and blood levels of the protein homocysteine were measured at the startof the trial and two years later. The MRI scans compared how much gray matterwas lost in brain regions most affected by Alzheimer’s disease.
“It’s a big effect, much bigger thanwe would have dreamt of,” A. David Smith said. “I find thespecificity of this staggering. We never dreamt it would be so specific.”
Brain Atrophy
The research reinforces previous findingsthat supplements slowed brain atrophy and cognitive decline in the group.
Smith and his colleagues at Oxford reportedin 2010 that the atrophy rate in patients’ whole brains was reduced about 30percent in those taking the vitamins and 53 percent in those on the vitamins whoalso had elevated homocysteine. They published study results in 2012 of memorytests that found people on the treatment who had high homocysteine were 69percent likelier to correctly remember a list of 12 words.
The studies, known as Vitacog, were fundedby seven charities and government agencies and vitamin maker Meda AB (MEDAA) ofSolna, Sweden. Smith is an inventor on three patents held by Oxford Universityfor B vitamin formulations to treat Alzheimer’s disease or MCI.
Vitamin B12 is found in liver, fish andmilk and folic acid in fruit and vegetables. Deficiency of folate and Bvitamins is already linked to dementia. Researchers such as Smith are studyingwhether less-than-optimal levels of B vitamins and folic acid contribute to itsdevelopment.
Possible Benefit
“If you have somebody who has outrightAlzheimer’s disease, this isn’t really going to help them much,” saidJoshua Miller, a professor in the department of nutritional sciences at RutgersUniversity in New Brunswick, New Jersey. “If you can catch them at anearlier level, they may be able to benefit from it but only if you haveelevated homocysteine.”
A U.S. study published in 2008 found thatpeople who had moderate or severe Alzheimer’s didn’t benefit from thesupplements. There’s no evidence that B vitamins enhance cognitive function inhealthy people, A. David Smith said.
Doctors in Sweden began measuringhomocysteine in people who report declining memory about two years ago, saidLokk at Karolinska. Swedish patients with high homocysteine are given folicacid and B vitamins, even if they aren’t deficient.
Taking Offensive
“We think the increased homocysteinelevel could be deleterious to the brain,” Lokk said. “We wanted to beon the offensive in diagnosing and treating patients. In our opinion, it isharmless and cheap.”
Vitamin B12 is probably the key to slowingthe brain’s shrinkage and cognitive decline, Miller said. The FDA said in 1998that folic acid had to be added to breads, cereals and other products that useenriched flour, to reduce neural tube defects such as spina bifida in newborns.A study by Miller and his colleagues in people of Mexican and South and CentralAmerican ancestry age 60 and older in Sacramento, California, the followingyear found their homocysteine was still high and that very few had low folate.Europe doesn’t require fortification of flour and breads.
Other studies have suggested that folicacid stimulates the growth of existing cancer cells. The data aren’tconclusive, so people at risk of cancer should avoid extra folic acid, Lokksaid. This could include men older than 70 who may have undetected prostatecancer, A. David Smith said.
“We’re not suggesting everyone over 60take this; we’re suggesting it should be targeted to people over 70 with highhomocysteine and memory problems,” he said.
Too Early
It’s too early to put everyone on Bvitamins, said Jess Smith of the Alzheimer’s Society.
“The evidence for supplementing isjust not there yet,” she said. “We need bigger studies and moreevidence that looks at what homocysteine is doing and what is actually going onin the brain.”
A. David Smith agrees. He plans a study ofB vitamins in 1,200 people over 70 with MCI and elevated homocysteine. He needs6 million pounds ($9.1 million) to pay for it. Miller plans another large studyand wants to see if folic acid in flour in the U.S. leads to different resultsthere. Meanwhile, the lack of blockbuster-drug potential presents fundinghurdles.
“The pharmaceutical companies aren’tgoing to make any money on this and the supplement companies aren’t going tohave enough money to do it,” Miller said. “This would have to begovernment-funded. I’m just not sure the climate is right for it now.”
To contact the reporter on this story: Andrea Gerlin in London at agerlin@bloomberg.net.
To contact the editor responsible for thisstory: Phil Serafino at pserafino@bloomberg.net.
More on health:
Doc Eifrig: Warning… Thiscommon ingredient could be making your children dumber
New research shows this easyactivity is as healthy as a serious workout
The government’s insane lightbulb laws could be far more damaging than you thought
Article source: http://www.thedailycrux.com/Post/42774/three-cheap-vitamins-could-work-better-than-prescription-drugs-for-alzheimer-s-and-dementia
From Global Economic Trend Analysis:
Here’s the question of the day: If you have a choice (and you many not for long because companies are abandoning grandfathered plans): Should you skip Obamacare and keep your old plan?
Any policy in place on March 23, 2010, the day health reform was enacted, falls under the grandfather exemption. As the Obama administration put it, if you like your plan, your doctor or both, you can keep them. Last year some 60 percent of employers, large and small, offered at least one grandfathered plan during open enrollment, according to the Kaiser survey. New employees can also join a grandfathered plan so long as the company has maintained consecutive enrollment in it.
For old plans as well as new ones, premiums are likely to rise next year – though the old plans still could be considerably more affordable than the newer ones.
Technically, a plan can stay grandfathered indefinitely, but few, if any, will. Most grandfathered plans have gone away already, according to the human-resources consultancy Mercer, which estimates only about a third of employers are expected to offer one in 2013.
Across the board, it is costs that will lead to the disappearance of most grandfathered plans. If employers or individual plans want to keep grandfathered status, they will have…
More on Obamacare:
Fantastic post exposes the ridiculous belief at the heart of the Obamacare boondoggle
Warning: The “Obamacare nightmare” will officially begin October 1
Five “massive” Obamacare taxes coming this year
Article source: http://www.thedailycrux.com/Post/42771/another-big-obamacare-lie-comes-to-light
From Bruce Krasting:
The Congressional Budget Office put conservative economic thinkers on their ass this week.
In this report, the CBO concluded that the US budget deficit is about to collapse to insignificance. The improvement in the deficit outlook is so large that it has lead liberal thinkers to start calling for more stimulus spending.
If it were not for the three scandals brewing for Obama (Benghazigate, IRSgate and APgate), I think there would be calls to spend some more government money.
The CBO assessment of the deficit profile relies on every trick in the book. The assumption is that all of the variables that weigh on the deficit will be improving over the next few years. Tax collections will remain at historically high levels. Government spending will decline as the economy improves. Fannie Mae and Freddie Mac will be kicking $95Bn into the coffers. Social Security will cost less than previously thought, the same favorable result is assumed for both Medicare and Medicaid. And of course, there will be no wars or military incursions that have to be paid for.
But, by far, the biggest driver of the reduced deficits will come from…
More on the deficits and the economy:
Doc Eifrig: What my favorite indicator is saying about the economy now
Controversial post: Why the economy is not “getting back to normal”
The 10 biggest myths about the economy explained
Article source: http://www.thedailycrux.com/Post/42772/what-you-should-know-about-the-government-s-insanely-positive-report-on-the-deficit
From Casey Research:
Like the United States, the European Union relies heavily on Russia and the Commonwealth of Independent States (CIS) for its uranium, as shown in the chart below:
Russia is projected to produce 64 million pounds per year by 2020. The majority – 40 million pounds – will come from Russia itself, and the remainder from its foreign projects in Kazakhstan, Ukraine, Uzbekistan, and Mongolia.
But there’s an often forgotten subsector of uranium production: the processes necessary to convert U3O8 into something that power plants can use.
For that purpose…
More on uranium:
Casey Research: One unexpected country could disrupt the global energy markets
The biggest hurdle to U.S. energy independence may have nothing to do with oil
Why one of the world’s most-hated commodities could be a “lock” to double — or more — this year
Article source: http://www.thedailycrux.com/Post/42770/this-coming-energy-battle-could-create-a-new-cold-war-
From Porter Stansberry in The SA Digest:
As you undoubtedly know, financial newsletter writers get paid to make bold, exciting predictions. Judging by the hyperbole in our industry’s sales letters, you’d have to imagine that we’re all bipolar. After all, according to newsletter writers, the world is always either about to end… or about to boom.
Today’s Friday Digest is no different. In fact, what I would like to show you today is without a doubt the single greatest threat to your wealth you will ever face. Even so, I’m confident almost all of you will ignore this warning until it is far, far too late. And that’s at least partly my fault. So before we get to the finance, I’d like to share something about my own company that I don’t like and wish I could change.
The reality is, the terrible things and incredible booms we predict (almost every day) in the sales presentations for our newsletter business rarely come to pass. I’d like to think our sales presentations are better than my fellow publishers… but truthfully, I’m pretty sure an outsider wouldn’t be able to tell the difference. So how can you tell when a newsletter writer’s dire warnings or emphatic recommendations are real… or at least likely to turn out to be right?
As you would imagine, I have some insight into this question. After all, I have written some of the most famously hyperbolic headlines of all time in our industry. Some of these predictions turned out to be right, like when I predicted Fannie Mae and Freddie Mac were going to zero.
New subscribers might rightfully wonder why a newsletter publisher (like me) would write such things about his own work and draw attention to the occasional excesses in his company’s marketing. Why would I remind our clients of the single biggest weakness of our business model – our need for hyperbolic sales pitches?
What can I say? I can’t help myself. I feel an obligation to tell you what I’d like you to tell me, were our roles reversed. That’s why I write the Friday Digest. I firmly believe that if you combine the strategies I explain in these notes with our investment research, you will excel as an investor. And then you’ll forgive us for the hyperbole required for our marketing.
In fact, I know thousands and thousands of investors around the world have used our work to become world-class investors. They depend on us for reliable and profitable ideas. When I meet them, they always ask… “Why do you people use such terrible marketing?” Well, we use what works. We assume, were you in our shoes, you’d do the same.
Sadly, though… perhaps because of our marketing, most of the people who try one of our investment newsletters either demand a refund or simply allow their subscription to lapse. The main reason that happens is because the reason they subscribed – the original hyperbolic headline – did not pan out the way they expected. (Or at least it didn’t pan out soon enough to suit their desires for the end of the world or the beginning of a new boom.)
Even worse… when the facts change, we’re likely to change our minds. But… nothing costs you more in publishing. That’s a fact. I can’t explain it… but it is the truth. Likewise, nobody wants to read that their cherished financial nonsense is going to come to a bad end. I can’t count the number of Peak Oil believers who’ve sent me angry demands for a refund – never mind the soaring oil and gas production numbers. Or the latest craze: digital currency Bitcoin. Just mentioning that Bitcoin might turn out badly will likely cost me several thousand subscribers. I’m not kidding.
So… how can you know when a newsletter writer is going to be right about an outlandish prediction… perhaps one that goes against your own beliefs about the market? In my opinion, the best guide is history. When history says the prices in a market have gotten completely out of whack, the newsletter writer is going to be right every time. If history isn’t your bag, you can look at the data and the trends and remember your statistics lessons: the central tendency, reversion to the mean. Let me give you one recent example from these pages.
About a year ago, I made an “outlandish” prediction – that natural gas prices were going to go up and oil prices were going to come down…
There are few things in life I know with certainty… But I know this: Barring the end of the world, the price of oil is going to fall and the price of natural gas is going to rise.
At the time, natural gas producer Chesapeake was collapsing because of low natural gas prices and nearly everyone on Wall Street was short natural gas. I recommended buying Chesapeake bonds and its competitor, Devon, and I predicted a huge rebound in natural gas prices.
In fact… I guaranteed that natural gas would soar because I knew it was certain – a 100% chance – that natural gas couldn’t continue to trade for less than $2 per thousand cubic feet (MCF). A year later, the price of gas has doubled. How did I know?
A barrel of oil contains 5.825 million British thermal units (Btu) of energy. One thousand cubic feet of gas contains just a little more than 1 million Btu. Thus, a barrel of oil has approximately six times more energy than 1 million cubic feet of gas. On an energy-equivalent basis, you would expect natural gas to trade for one-sixth the price of oil. But of course, oil is more highly prized as a fuel source. It’s more easily portable and thus is a better fuel for transportation.
Historically, looking at the two commodities, the average multiple of gas to oil was about 10x. That is, a barrel of oil was, on average, 10 times more expensive than one thousand cubic feet of gas. By last April, that premium had reached an all-time high of 55 times.
There was no way that kind of price relationship could have lasted. A reversion to the mean was 100% certain. And that’s what happened. Today, with West Texas Intermediate crude oil at $95 per barrel and natural gas at around $4, the ratio is still wide, at almost 24 times. But it’s half as wide as last year. You should expect oil prices to continue to decline and gas prices to continue to rise. I believe the future 10x equilibrium will be reached when gas is around $6 and oil is around $60.
Now… let me give you another “outlandish” prediction. The U.S. bond market – particularly junk bonds – is going to crash. When this crash occurs, it will be the largest destruction of wealth in history. There has never been a bigger bubble in U.S. bonds.
How do I know? It’s simple. Junk bonds (aka high-yield bonds issued by less creditworthy companies) have never yielded less than 5% annually. But they do today. Likewise, the difference between the yields on junk bonds and the yields on investment-grade bonds has almost never been smaller. That means credit is more available today than almost ever before for small, less-than-investment-grade firms. The last time credit was this widely available – and at such low costs – was in 2007. And you know how that turned out…
The coming collapse in the bond market will be far worse than it was last time, too. This time, the Federal Reserve’s actions have driven forward the huge bull market in bonds. The Fed is printing up almost $100 billion per month and buying bonds. That has forced the other buyers of bonds to buy riskier debt that, historically, offered much higher yields.
Today, those yields have been incredibly “compressed.” You can imagine the high-yield segment of the bond market to be like a spring whose coils have been driven together by the force of the Federal Reserve’s market manipulation. As soon as the Fed’s buying stops (and it must stop one day, or else it will trigger hyperinflation), the yields on those riskier bonds will soar again. As bond yields rise, the price of bonds will fall sharply.
To give you a specific example, car manufacturer General Motors recently issued bonds to investors. The yield on these securities was only 3.25%. I’m fairly certain that inflation in our economy will exceed that rate.
That’s why a company that went bankrupt in the last five years… that operates in a highly competitive market… and still suffers from massive overcapacity… is paying essentially nothing for capital. That doesn’t make any sense. Investors are being paid nothing, in real terms, for their savings – or to accept the real risk that GM could default. Investors ought to be getting at least 7.5% on these bonds, a yield that would cause the price of these bonds to fall 50%.
I believe we’ll see a real panic in the corporate bond market at some point in the next year. I expect the average price of non-investment-grade debt (aka junk bonds) to fall 50%. Investment-grade bonds will fall substantially, too. (I’d estimate something around 25%.) This is going to wipe out a huge amount of capital… and believe me… it’s 100% guaranteed to happen.
Crux Note: Porter recently released a report he’s been working on for the past ten years… and if you own gold – or are considering buying it today – you should drop everything and read it now. In short, he says you could become “unbelievably rich” or “disastrously poor,” based on one simple gold decision almost everyone gets wrong. Click here to see the full report for yourself.
More from Porter:
Porter Stansberry: One time it’s OK to break this sacred investment rule
Porter Stansberry: The two most important secrets of successful investing
Porter Stansberry: A serious letter to my readers
Article source: http://www.thedailycrux.com/Post/42769/porter-stansberry-there-is-now-a-100-chance-of-a-market-collapse
The decline in the global gold price will be only temporary and will rebound on speculation that Italy and other countries in Europe may have to sell gold reserves for debt repayment, the head of the NESDB said on Tuesday.
National Economic and Social Development Board (NESDB) secretary general Arkom Tempitayapaisit said he disagrees with an analyst at a foreign bank who forecast that the gold price is now on a five-year downward trend and will fall below US$1,000 per ounce. The gold price on Tuesday evening in New York was $1,380.16 per ounce.
It would be difficult for the gold price to continue downwar for five years, he said. Gold is held both as a reserve and as a speculative commodity. The current decline in price was because some countries in Europe have insufficient cash reserves to make debt repayments. They have taken up the option to sell some national gold reserves, thus bringing the price down.
A one-year chart shows the trend of world gold prices, under the value as of Tuesday evening Bangkok time. Chart by Goldprice.org
Cyprus had earlier sold gold and it is expected Italy will soon follow suit. This will bring down global gold prices for a short time, he added.
The Bank of Thailand also keeps gold as a reserve. If it sells gold now, it would face a loss because it bought in at a higher price, he said.
On Tuesday as of 4.05pm, local gold prices opened up 400 baht on Monday’s close.
The Gold Traders Association announced buying prices at 19,162.24 baht per baht-weight for gold ornaments and 19,450 baht per baht-weight for gold bar. Selling prices were set at 19,950 baht per baht-weight for gold ornaments, and 19,550 baht per baht-weight for gold bar.
Meanwhile, the central bank’s governor Prasarn Trairatvorakul said on Tuesday that monetary policy could be eased if the economy loses momentum. In short, this was a signal he may cut interest rates next week after slower-than-estimated growth last quarter. The Bank of Thailand’s Monetary Policy Committee (MPC) is to meet on May 29.
“Our monetary policy aim is to maintain equilibrium in the economy,” Mr Prasarn said. “If we see that economic momentum slows, we can ease monetary policy to take care of that.”
The government’s NESDB on Monday lowered its full-year growth forecast for gross domestic product to 4.2% to 5.2% from 4.5% to 5.5% after the economy expanded 5.3% in the first quarter from a year earlier, less than economists estimated. It also cut its export growth target for the year to 7.6% from 11%.
NESDB secretary-general Arkom said he is “worried about the second quarter,” adding that monetary policy could address the slowdown and also help curb inflows that have boosted the baht.
The baht rose 0.3% to 29.72 per dollar as of 1.25pm Tuesday in Bangkok, after earlier climbing to its highest level in two weeks as concerns that the government will impose curbs on capital inflows abated. The currency strengthened last month to its highest level since July 1997, and is the best performer in Asia this year, according to data compiled by Bloomberg.
While the baht may be volatile amid global uncertainties, the central bank is ready to intervene if needed, Mr Prasarn said, adding that the central bank will analyse first-quarter data before deciding on the policy rate.
The BoT’s Monetary Policy Committee is scheduled to meet on May 29. It has held the key rate at 2.75% since a 25-basis-point reduction in October, citing risks to Thailand’s financial stability.
Finance Minister Kittiratt Na-Ranong, who has led calls for lower rates, said on Monday that the government has no plans to issue “abnormal measures” to stimulate the economy, even as it is concerned about the first-quarter numbers.
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The decline in the global gold price will be only temporary and comes on the back of speculation that Italy and other countries in Europe could sell gold reserves for debt repayment, the secretary general of the Office of the National Economic and Social Development Board (NESDB), Arkom Tempitayapaisit, said on Tuesday.
Reuters file photo
Mr Arkom said he disagreed with an analyst at a foreign bank who forecast that the gold price is now on a five-year downward trend and will fall below US$1,000 per ounce.
It would be difficult for the gold price to go down for five years, because gold is not only held as a reserve it is also a speculative commodity. The current decline in its price was because some countries in Europe have insufficient cash reserves to make debt repayments. One of their options is to sell some of their national gold reserves, he said. This bulk selling brings down the price.
Cyprus had earlier sold gold and it is expected Italy will soon follow suit. This would bring down the global gold price for a short time, he added.
The central bank also keeps gold as a reserve and if it sells gold at this time it would face a loss because it bought in at a higher price, he said.
Reuters reported the gold price was down for the eighth straight day to US$1,338.85 per ounce on Monday, May 20.
The gold price dropped to its lowest level in two years, at US$1,321.35 an ounce, on April 16 on investors’ concerns the US would delay its plan for further quantitative easing (QE) to stimulate the economy, which is showing signs of recovery.
On Monday, the Gold Traders Association had changed gold prices for five times, with a total decline of 200 baht on the day. Buying price closed at 19,050 baht per baht weight and selling price at 19,150 baht for gold bar.
The gold prices opened up 450 baht on Monday’s close on Tuesday morning. Buying price opened at 19,500 baht per baht-weight and selling price at 19,600 baht for gold bar.
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Writer: Online Reporters
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Bangkok Post online classifieds
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Article source: http://www.bangkokpost.com/breakingnews/351123/gold-not-on-5-year-downward-spiral-as-predicted-says-nedb-chief
The price of gold rose Monday for the first time in nearly two weeks.
Gold for June delivery rose $19.40 to settle at $1,384.10 an ounce Monday, an increase of 1.4 percent. It was the first gain since May 8.
The price of gold has been falling since last autumn. Its appeal as an alternative investment faded as the U.S. dollar rose. Subdued inflation and worries that Cyprus might sell some of its gold reserves to support its banks have also given traders reasons to sell gold.
The price of gold has fallen 23 percent since Oct. 4, when it closed at $1,796.50 an ounce.
Silver, copper, platinum and palladium also rose Monday.
Copper for July delivery rose 3.7 cents, or 1.1 percent, to $3.36 a pound, while silver for July delivery gained 23 cents, or 1 percent, to $22.58.
Platinum for July delivery rose $16.60, or 1.1 percent, to $1,484.60 an ounce. Palladium for June delivery rose $10.50 to $750.75 an ounce, a gain of 1.4 percent.
In the market for grains and other crops, wheat and soybeans rose, while corn fell.
Wheat for July delivery rose 2 cents to $6.8525 a bushel.
Corn for July delivery fell 3.25 cents to $6.4950 a bushel. Soybeans for the same month rose 16 cents to $14.645 a bushel.
In the oil and gas market, benchmark oil for June delivery gained 69 cents to close at $96.71 a barrel on the New York Mercantile Exchange.
In other energy futures trading on Nymex:
— Wholesale gasoline was flat at $2.91 a gallon.
— Heating oil rose 1 cent to $2.95 a gallon.
— Natural gas gained 4 cents to $4.09 per 1,000 cubic feet.
Article source: http://www.cadillacnews.com/ap_story/?story_id=119632&issue=20130520&ap_cat=1
The price of gold rose Monday for the first time in nearly two weeks.
Gold for June delivery rose $19.40 to settle at $1,384.10 an ounce Monday, an increase of 1.4 percent. It was the first gain since May 8.
The price of gold has been falling since last autumn. Its appeal as an alternative investment faded as the U.S. dollar rose. Subdued inflation and worries that Cyprus might sell some of its gold reserves to support its banks have also given traders reasons to sell gold.
The price of gold has fallen 23 percent since Oct. 4, when it closed at $1,796.50 an ounce.
Silver, copper, platinum and palladium also rose Monday.
Copper for July delivery rose 3.7 cents, or 1.1 percent, to $3.36 a pound, while silver for July delivery gained 23 cents, or 1 percent, to $22.58.
Platinum for July delivery rose $16.60, or 1.1 percent, to $1,484.60 an ounce. Palladium for June delivery rose $10.50 to $750.75 an ounce, a gain of 1.4 percent.
In the market for grains and other crops, wheat and soybeans rose, while corn fell.
Wheat for July delivery rose 2 cents to $6.8525 a bushel.
Corn for July delivery fell 3.25 cents to $6.4950 a bushel. Soybeans for the same month rose 16 cents to $14.645 a bushel.
In the oil and gas market, benchmark oil for June delivery gained 69 cents to close at $96.71 a barrel on the New York Mercantile Exchange.
In other energy futures trading on Nymex:
— Wholesale gasoline was flat at $2.91 a gallon.
— Heating oil rose 1 cent to $2.95 a gallon.
— Natural gas gained 4 cents to $4.09 per 1,000 cubic feet.
Article source: http://www.businessweek.com/ap/2013-05-20/gold-breaks-a-losing-streak-other-metals-rise
From Carpe Diem:
From today’s WSJ editorial “Red Tape Record Breakers”:
“For two decades, Wayne Crews of the Competitive Enterprise Institute has tracked the growth of new federal regulations. In his 20th anniversary edition to be released tomorrow, he’ll report [the following]…
1. The pages in the Code of Federal Regulations hit an all-time high of 174,545 pages in 2012, an increase of more than 21% during the last decade.
2. In 2012, the cost of federal rules exceeded $1.8 trillion, roughly equal to the GDP of Canada ($1.81 trillion) and India ($1.82 trillion).
3. Regulatory burdens cost each US household $14,768, meaning that red tape is now the second largest item in the typical family budget after housing.
4. In 2012, 4,062…
More government insanity:
Today’s entertainment: Jon Stewart’s “brilliant” take on the IRS scandal
UNBELIEVABLE: California Congressman exposes ANOTHER huge potential White House scandal
Five “no brainer” ways the government could save billions of wasted dollars each year
Article source: http://www.thedailycrux.com/Post/42767/new-report-shows-out-of-control-government-is-costing-average-american-families-a-fortune
From Frank Holmes of U.S. Global Investors:
Samuel Johnson once said, “The use of traveling is to regulate imagination by reality, and instead of thinking how things may be, to see them as they are.”
Although penned by an 18th century English writer, the idea holds true in today’s highly connected world of search bars, tweets and breaking news. Our portfolio managers’ research trips to foreign countries authenticates the data from a Bloomberg terminal or an earnings report. Treks add tacit knowledge to our wealth of explicit facts…
… Back in the U.S., no one needs to travel far to see the tremendous growth in domestic stock prices. Over the last four years, the SP 500 Index climbed 21 percent annually.
But how much further should you expect them to go?
The Federal Reserve Bank of New York had the same thought and delved deep into data to find out.
Would it surprise you to learn that a vast majority of equity valuation models state that stocks should head much higher over the next five years?
This is research based on 29 different equity valuation models and surveys that use varying economic and market-related data such as dividends or inflation to calculate potential future returns. Using a weighted average, the New York Fed estimated the equity risk premium over the following month.
Simply stated, the equity risk premium is…
More on stocks:
An unusual thing has been happening to stock market sentiment
Major stock markets across the globe are now breaking out
This chart could provide the first warning of a stock market correction
Article source: http://www.thedailycrux.com/Post/42768/according-to-one-little-known-measure-stocks-could-be-on-the-verge-of-another-multiyear-rally
From Junk Science:
With the IRS scandal shining a much-needed light on the miserable agency that would be the majordomo of Obamacare, we should also examine the preposterous “reasoning” at the heart of the Patient Protection and Affordable Care Act (PPACA)…
I refer to the quite foolish notion that making insurance more available, albeit not necessarily more affordable, is somehow the biggest problem facing our failing health care system.
Let’s try an analogy: Imagine for a moment that there were a horrendous crisis involving house fires. Destruction and injury were rampant. The root causes were manifold, and thousands of people were dying.
Imagine further that the brilliant political solution to this problem did not involve hiring more firefighters, nor even any efforts toward fire prevention.
Rather, the Government decided that more fire insurance was the answer. To spread the burden, even if you did not own a house, you still had to obtain insurance or face a penalty (sorry, a tax).
What if you really bought into this idea and decided to get a so-called “Cadillac” insurance plan? Well, then you would pay a penalty for that, as well.
A massive bureaucracy would be put in place to ensure that any work done to fix your home had to be performed in accordance with certain guidelines and for a certain price. Don’t try asking for anything off the page.
Meanwhile, houses would continue to burn, people would continue to die, and the underlying situation would not be improved in any measurable way.
Some home rebuilding “providers” would find ways to game the system, so the bureaucracy would have to expand to monitor the fraud, while making it even more difficult to get your home rebuilt, at an ever-increasing cost.
Likewise, honest providers would simply gear their projects toward those home-rebuilding “procedures” which were more remunerative, rather than what might be best for the homeowner.
The only possible result of this madness is ever-increasing costs for ever-worsening outcomes…
More on the Obamacare boondoggle:
Disturbing report reveals a fact about Obamacare you probably haven’t heard
Warning: The “Obamacare nightmare” will officially begin October 1
No joke: Millions of Americans could lose health insurance because of Obamacare
Article source: http://www.thedailycrux.com/Post/42765/fantastic-post-exposes-the-ridiculous-belief-at-the-heart-of-the-obamacare-boondoggle
From The TSI Trader:
This post is going to steer clear of any heavy thinking and just focus on a few ideas and observations regarding the weekly charts of gold futures (GC), the Gold Bugs Index (HUI), and a single daily chart of silver futures (SI).
I’ve been curious to untangle in my own mind how the various downside price projections for gold and the mining index are being calculated by others, so I did a little investigating and will show you what I figured out so far.
To log or not to log? This does seem to be a question that explains some of the projections I have seen. I am talking about whether one charts price and its trend lines using log scale or not. The results of choosing one method or the other does provide some striking differences, as we shall see.
Let’s begin with a long term weekly view of gold futures (GC) using log scale. This chart probably looks familiar to you because this is the setting I use to make my charts usually. You will note the three different colored line segments of increasing slope that define gold’s parabola as it has developed. And you will observe that price currently is right on the uppermost trend line…
More on gold and silver:
Top commodities trader: A MAJOR low in silver could be forming now
Top resource CEO: Four fundamental facts to remember about gold
Controversial post: Why another attack on gold could be coming soon
Article source: http://www.thedailycrux.com/Post/42766/four-long-term-charts-every-gold-and-silver-bull-should-see
From Dennis Miller of Casey Research:
Ninety-eight percent of insurance brokers do not know how to use life insurance optimally.
That, anyway, is what one reader wrote in to tell me. I chuckled as I thought to myself, “You could substitute any profession for ‘insurance broker’ – lawyer, salesperson, politician, etc. – and that statement would still ring true.”
Sure, I laughed a little, but it wouldn’t be funny to realize I’d been misled into investing in something only marginally advantageous when there was a better alternative available.
Caveat emptor – let the buyer beware – has been an underlying theme in several of our recent Money Forever premium issues. It’s a prudent thought to keep in mind when plunking down your money for any number of alternative investments, such as an annuity or reverse mortgage, and when selecting a professional financial advisor.
It’s a warning I heard loud and clear while reading an article highlighting the pitfalls of…
More on investing:
Porter Stansberry: One time it’s OK to break this sacred investment rule
What superinvestors Warren Buffett and Charlie Munger are thinking now
One of the world’s greatest investors speaks out on the incredible rally in stocks
Article source: http://www.thedailycrux.com/Post/42764/what-you-should-know-before-choosing-a-financial-advisor
From Ron Paul:
“What do you expect when you target the President?” This is what an Internal Revenue Service (IRS) agent allegedly said to the head of a conservative organization that was being audited after calling for the impeachment of then-President Clinton.
Recent revelations that IRS agents gave “special scrutiny” to organizations opposed to the current administration’s policies suggest that many in the IRS still believe harassing the President’s opponents is part of their job.
As troubling as these recent reports are, it would be a grave mistake to think that IRS harassment of opponents of the incumbent President is a modern, or a partisan, phenomenon.
As scholar Burton Folsom pointed out in his book New Deal or Raw Deal, IRS agents in the 1930s where essentially “hit squads” against opponents of the New Deal. It is well-known that the administrations of John F. Kennedy and Lyndon Johnson used the IRS to silence their critics. One of the articles of impeachment drawn up against Richard Nixon dealt with his use of the IRS to harass his political enemies. Allegations of IRS abuses were common during the Clinton administration, and just this week some of the current administration’s defenders recalled that antiwar and progressive groups alleged harassment by the IRS during the Bush presidency.
The bipartisan tradition of using the IRS as a tool to harass political opponents suggests that the problem is deeper than just a few “rogue” IRS agents – or even corruption within one, two, three or many administrations. Instead, the problem lays in the extraordinary power the tax system grants the IRS…
More on taxes and the IRS:
Today’s entertainment: Jon Stewart’s “brilliant” take on the IRS scandal
Why even liberals should be outraged by the latest IRS scandal
Gov’t gone WILD: IRS caught targeting conservatives during 2012 elections
Article source: http://www.thedailycrux.com/Post/42762/ron-paul-the-irs-scandal-is-much-bigger-than-you-know
From Dr. David Eifrig in Retirement Millionaire:
Don’t trust your prostate specific antigen (PSA) levels if you’ve been bicycling…
Checking levels of PSA is a common – though flawed – way to test if a man has prostate cancer. High PSA levels may indicate prostate cancer… and lead to more invasive tests, like biopsies.
It turns out, cycling increases men’s PSA levels, causing false positive tests. Unfortunately, doctors don’t seem to grasp this and aren’t asking questions before performing the tests. If you cycle regularly, wait at least 48 hours to have a PSA test. This gives your levels time to return to normal.
Regular readers know I’m skeptical of the usefulness of PSA tests. Some benign conditions – like inflammation of the prostate, systemic infections, or even recent ejaculation – can increase PSA levels.
Because of this, PSA tests are known for having a high rate of false positives. So make sure your doctor is aware of these factors if your levels are high.
Crux Note: Doc Eifrig is one of our most trusted advisors on health and building a great retirement… but he recently came across a little-known “loophole” in a different area: precious metals. If you still haven’t tried it for yourself, click here.
More from Doc Eifrig:
Doc Eifrig: What my favorite indicator is saying about the economy now
Doc Eifrig: New research shows this easy activity is as healthy as a serious workout
Doc Eifrig: Warning… This common ingredient could be making your children dumber
Article source: http://www.thedailycrux.com/Post/42763/doc-eifrig-this-common-cancer-screen-could-be-useless-for-some-men
Geojit Comtrade’s technical updates on commodities –
MCX Gold June : Sell around 26850 levels with a stop loss placed above 27000 levels for targets of 26600 levels.
MCX Silver July : Sell around 44900 levels with a stop loss placed above 45400 levels for targets of 44100 levels.
MCX Crude May : Sell around 5220 levels with a stop loss placed above 5260 levels for targets of 5140 levels.
MCX Natural Gas May : Buy around 214 levels with a stop loss placed below 210 levels for targets of 220 levels.
MCX Copper June : Sell around 403 levels with a stop loss placed above 408 levels for targets of 396 levels.
MCX Nickel May : Sell around 835 levels with a stop loss placed above 850 levels for targets of 812 levels.
MCX Lead May : Sell around 109 levels with a stop loss placed above 110 levels for targets of 107 levels.
MCX Zinc May : Sell around 100.50 levels with a stop loss placed above 102 levels for targets of 98 levels.
MCX Aluminium May : Sell around 101 levels with a stop loss placed above 102 levels for targets of 99 levels.
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Article source: http://www.moneycontrol.com/news/brokerage-recos-commodities/sell-mcx-gold-june-target-rs-26600-geojit-comtrade_870893.html
Time to sell gold? Leveraged traders sure think so…
ANOTHER DAY, another beating for gold and silver investors, writes Greg Canavan at The Daily Reckoning Australia.
After trading lower all day Friday, Asian futures markets today opened in a panic, with leveraged holders no doubt getting margin calls over the weekend. The result? Stump up more cash or sell. Clearly, selling is the preferred option.
It seems like a lot of punters are trying to pick the bottom. They’re buying in the expectation of a bounce…and when that doesn’t eventuate, more selling takes place.
In gold, we’re now closing in on the low from April at around US$1320. Will it hold or head lower still? We have no idea. And we certainly wouldn’t be utilising the futures market to make a bet on it.
But we do know that for every seller there is a buyer, whether it’s in the futures market or the physical gold market. Some are happy that prices are again back at levels from a few years ago. They’re the ‘strong hands’ and they’re taking in what the ‘weak hands’ throw into the market.
All this reminds us of 1999. Back then you had financial market euphoria in the midst of a new internet age. The tech bubble was in full swing. Stocks – especially anything tech related – were a sure thing. They went up day after day on nothing more than hope and expectation.
Meanwhile, gold was in the doldrums…a barbarous relic well past its time. In the modern age of pets.com and new paradigms, gold was an anachronism. But as hindsight was to show, 1999 represented the nadir in gold’s long bear market.
Today, we are in a similar state of market euphoria. Everyone is jumping on the central bank bandwagon. They’re making bets that can’t lose. Downside risk has central bank protection (the Bernanke put) and the upside is unlimited.
What could possible go wrong?
Against this backdrop, institutional investors and speculators dump gold futures to go long SP futures. And it’s a great trade at the moment. It ‘makes sense’. As in 1999, who sees the sense in owning gold when faith in central banks (or new technology) seems all-pervasive? Right now, it seems like an unnecessary hedge – so sell, Sell, SELL!
That may be the mindset of the speculator, but it’s a different story for the physical gold advocate. According to reports, physical gold demand is as strong as ever in India and China. And last months’ price plunge led to huge demand from the ‘retail’ investor all around the world.
So while the ‘institutional imperative’ (Warren Buffett’s reference to the short term pressure that institutions face to ‘do something’) forces the hand of big money, the small investor takes a longer view. They see a world distorted by cheap money. They see a highly fragile financial system. You don’t get a stock market melt-up when the underlying financial foundations are sound. You get this type of price action when there is something very, very wrong with the system and the price signals and incentives it gives off.
On the face of it, it is entirely rational that markets are soaring on the back of unprecedented central bank largesse. And it is rational that speculators see less need for a hedge in such circumstances, and so they sell gold. But we are pretty confident that hindsight will prove this trade to be a very big mistake. And the biggest mistake is that most players think they can get out before everyone else.
The other similarity between now and 1999 is a little more obscure. It relates to the extremely low ‘gold forward offered rate’ (GOFO) that was prevalent in 1999 and…now. The GOFO is the interest rate one must pay to borrow US Dollars using gold as collateral. Alternatively, it is the interest rate charged by holders of US Dollars to obtain gold short term. The lower the rate, the greater the demand for gold, or the greater amount of Dollars bidding for gold.
Last week the 3-month GOFO dropped to the lowest level since 1999 (when the three month rate actually went into backwardation…a highly unusual situation where the owner of gold gets paid to swap their gold for US Dollars).
So once again, despite (or because of) falling prices, the gold interest rate structure is telling you demand for physical gold remains very strong.
But there is one important difference worth considering. In 1999 market interest rates were much more ‘normal’ than they are now. A series of recent articles in the Financial Times’ Alphaville blog argue that a super low GOFO simply reflects super low rates everywhere. It doesn’t signal strong demand for physical gold, but just an attempt by risk adverse institutional money to protect capital in a deflationary environment.
It’s a complex argument, and a bit beyond our simple powers of comprehension. Being a simpleton, we tend to think the right interpretation is the simplest one. And the simplest interpretation of gold is that it will protect your wealth in times of severe monetary distortion. Full stop. End of story.
That gold doesn’t seem to be doing so now is a product of markets sending wildly false price signals – just as the SP500 and the Dow Jones are sending a false signal of a US economy in good health. The falling gold price is sending a false signal about the underlying health of the financial system. And tragically, when the majority of investors succumb to this false signal, it will likely turn around warn of the opposite development.
We have no idea when this will happen, but to give your imagination a kick along, we include this comparison of gold’s recent performance with the 1970s’ bull market (sourced from Jesse’s Café American). From 1975-1976, the gold price fell 50%. The yellow line in the chart below represents the latter part of that correction. As you can see, a steep price fall was followed by a rebound, then another fall to new lows.
This last dramatic fall obviously cleared out the last of the weak hands, and set gold up for an explosive move higher in the years to come.
So far, the 2013 move in gold is following the 1976 script. If that continues, expect new lows very soon, followed by a sharp reversal.
Don’t bet on it though. History rarely repeats exactly. We offer the comparison only to show that we’ve been here before. And also to make the comment that if you want to ride a bull market through to the end, you must first endure years of pain…of being ‘wrong’ and feeling like a fool.
The market is not so much a test of intellectual strength as emotional strength. If you don’t have conviction and belief in your position, the market will take you out the back and beat you senseless.
And we’re guessing many gold investors are this week wondering when the beatings will stop.
Article source: http://goldnews.bullionvault.com/gold-1976-052020132
Saturday, May 11, 2013 | 12:10 a.m.
Gold prices fell for a seventh day in a row on Friday, drawn down by a stronger U.S. dollar and better economic news.
Gold for June delivery dropped 1.6 percent, losing $22.20 to settle at $1,364.70 an ounce. The precious metal is nearing the recent low of $1,352 it reached April 15, after a two-day plunge knocked $200 off its price.
Investors have been pulling out of the gold market as the stock market keeps climbing and the dollar gains strength. The dollar made gains against most major currencies Friday.
In other trading, silver, platinum and palladium fell, while copper rose. Silver for July delivery lost 30.7 cents to settle at $22.35 an ounce, a 1.4 percent drop.
Copper for July delivery rose 2.85 cents, or 0.9 percent, to $3.32 a pound.
Platinum for July delivery fell $17.60, or 1.2 percent, to $1,468 an ounce. Palladium for June delivery fell 50 cents to $740.25 an ounce, a slight loss of 0.1 percent.
In the market for grains and other crops, wheat fell, while corn and soybeans rose. Wheat for July delivery fell 4.5 cents to $6.8325 a bushel.
Corn for July delivery rose 11.25 cents to $6.5275 a bushel. Soybeans for the same month rose 21 cents to $14.485 a bushel.
In the oil and gas market, the price of crude oil rose on bets that a steady recovery in the U.S. economy could increase fuel use.
Benchmark oil for June delivery rose 86 cents to close at $96.02 a barrel on the New York Mercantile Exchange.
In other energy futures trading on the Nymex:
_ Wholesale gasoline rose 2 cents to end at $2.91 a gallon.
_ Heating oil added 3 cents to finish at $2.94 a gallon.
_ Natural gas gained 12 cents to end at $4.06 per 1,000 cubic feet.
Article source: http://www.lasvegassun.com/news/2013/may/11/us-commodities-review/
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