Gold prices shot up toward $1,700/oz. Friday on safe haven buying and a sharply weaker dollar amid QE3 hints from the Fed. Stocks cheer. Gold last traded at $1,691 an ounce, up 1.4% for the week, silver traded at $31.74 an ounce, up nearly 3%.
GOLD AT FIVE-MONTH HIGH ON FED STIMULUS HOPES - Reuters
Gold surged to a five-month high Friday after Federal Reserve Chairman Ben Bernanke gave a speech speculating that more stimulus is in the near future. In this speech he stated that progress reducing unemployment was too slow and the US economy faces "daunting" challenges.
‘QE3’ IS NECESSARY, BERNANKE SUGGESTS - Marketwatch
The Federal Reserve will soon fire off another round of bond-buying in an effort to goose the economy and bring down the unemployment rate. While Fed Chairman Ben Bernanke did not give any hints at the timing of the next Fed move, he made it clear that he’s ready to pull the trigger.
MONETARY POLICY HAS REACHED A DEAD END: GROSS - CNBC
The Federal Reserve will likely embark on its next round of monetary stimulus in two weeks, Bill Gross, Pimco’s co-chief investment officer, told CNBC’s "Street Signs" on Friday. But he said more stimulus won’t do much to improve the country’s job market. What the Fed is targeting in terms of quantitative easing is sustained improvement in employment.
THE PRINTING PRESS HAS REACHED ITS LIMITS - Telegraph
Faith in central banks as guarantors of macro-economic stability has been shaken to breaking point by the events of recent years, a crisis which they utterly failed to see coming, much less were able to prevent. It is unwise to place too much faith in central banks. The most they can hope to do is paper over the cracks. Without politically painful supply-side reform to correct these failings, we can look forward to years of stagnation or worse.
Swiss America will be closed on Monday, Sept. 3rd in observance of the Labor Day holiday.
Gold prices held gains above $1,650/oz. Thursday on bargain hunting and a weaker dollar. Stocks fall amid mixed data. Gold last traded at $1,655 an ounce, silver traded at $30.44 an ounce.
CALM BEFORE THE STORM FOR STOCKS, GOLD? - Marketwatch
"The closer we get to the presidential election, the less the chance that Bernanke will pull the QE trigger," Richard Russell tells Marketwatch. Interest rates (thank the Fed) remain absurdly low.
"The man in the street gets almost nothing for his savings, and unemployment remains high. The fast-contracting middle class’ sentiment is a mixture of fear and frustration. With low interest rates and meager dividend yields, most pension funds can’t keep up their funding."
Russell’s conclusion: “At this point I think gold is more interesting than the stock market. Most people don’t realize the incredible safety of gold…My choice of an investment position — gold, and enough cash to pay the bills.”
DEFINING MOMENTS - Editor
Most Americans have rightly concluded that Obamanomics is a failure, but polls show that independent voters remain skeptical as the whether either party has a solution. Will we double down on failed policies of the last 4 years? Or will we vote for real change and hope by reversing our course toward free market solutions? We shall soon find out.
WHY DOES A STABLE DOLLAR MYSTIFY LIBERALS? - Forbes
It’s not surprising that liberals are apoplectic over a provision in the draft Republican Party platform calling for the establishment of a commission to study “possible ways to set a fixed value for the dollar”. After all, this amounts to a “right to life” plank for the dollar, the economy, and the American middle class.
If the U.S. economy had continued to expand at an actual 3.94% over the past 41 years, 2011 GDP would have been $23.6 trillion, 56% higher than it was in reality. Our economy would have been more than three times as big as China’s, rather than just over twice as large. And, at the same level of spending, the federal government would have run a $0.5 trillion budget surplus, instead of a $1.3 trillion deficit.
THE RYAN DIFFERENCE - Wall St. Journal
What's going on? The Romney campaign deserves credit for staging an Inchon landing by skillfully using ObamaCare to go on offense against Mr. Obama on Medicare. Liberals and the reporters they dine with still can't bring themselves to believe their historic achievement is unpopular, so they and the press corps refuse to admit that the Affordable Care Act has changed the entitlement debate.
But retirees know that Mr. Obama robbed Medicare's accounts to make ObamaCare's budget impact look benign. In choosing Mr. Ryan, Mr. Romney gave Americans hope that he is trying to rally the country for the larger purpose of greater freedom and national revival.
'THE ECONOMY STOLE MY RETIREMENT' - Wall St. Journal
Danny Sullivan dreams of gardening and spending time with his grandchildren, but that's just a fantasy. Retirement is out of his reach, at least for the foreseeable future. Mr. Sullivan has struggled to sell Arguello Catering, the Redwood City, Calif., he started 21 years ago.
Nearly half of the 799 small-business owners surveyed in August by The Wall Street Journal and Vistage International, expect to retire after age 65, with 38% saying that their planned retirement date is later than they had predicted five years ago.
The median selling price for U.S. small businesses during the first half of this year was $150,000, down 25% from $200,000 in the first half 2008, according to BizBuySell.com
Gold prices consolidated recent gains above $1,650/oz. Wednesday on profit taking and a flat dollar. Stocks inch up amid uncertainty. Gold last traded at $1,656 an ounce, silver traded at $30.70 an ounce.
"US Growth Inches Along With GDP Posting 1.7% Gain," reports a CNBC headline. Another reads, "Economist Sees No-Growth Decade Looming". Meanwhile, Marketwatch warns of a, "Looming currency war". None of these headlines are a surprise to our regular readers.
'Hard Truths' to be Focus of Ryan's Acceptance Speech, says Fox News. After rousing speeches from Ann Romney and "I want a second American Century" N.J. Gov. Chris Christie, VP nominee Paul Ryan takes center stage tonight.
YOUR WINDOW TO BUY BELOW $1,700 IS CLOSING - CaseyResearch
Some investors lamented that gold prices had been stuck in a rut for a long time. Others were confused. A few bailed. And some have been stocking up because they're convinced prices won't stay down forever.
Based on the chart data, I believe the window of time to buy gold for less than $1,700 an ounce is very limited. Here's why. I examined gold's three largest corrections since the bull market began in 2001, including how long it took to recover from those corrections and establish new highs. The conclusion that emerged is that the current lull in gold prices will almost certainly end soon, if it hasn't already.
THE FED SHOULDN'T DOUBLE-DOWN ON FAILURE - IBD
As Federal Reserve Chairman Ben Bernanke prepares for his speech Friday at the central bank's annual gathering in Jackson Hole, Wyo., trouble is brewing. Not everyone at the Fed — or in Congress — is keen on another round of quantitative easing. And we can see why.
Since the Fed first began its QE program in 2009, the economy has been stuck in the doldrums, with subpar GDP and job growth, 15% real unemployment, a 4.8% decline in median incomes, a fast-shrinking middle class and a tidal wave of government debt that threatens to swamp the economy. Yet, to hear Bernanke, you'd think things are fine.
TODAY'S VOTERS MOST WANT ECONOMIC GROWTH - Wall Street Journal
Most Americans have concluded that Obamanomics is a failure, but polls also show that independent voters remain skeptical that either party has an answer to the malaise of the Obama and latter Bush years. This cynicism plays into the hands of President Obama, who is trying to convince Americans that 1.5% growth and 42 months of more than 8% unemployment is the best we could have expected.
Romney and Ryan have a defensible economic revival plan. Marginal-rate tax reductions and reform, regulatory relief, sound money, and an energy policy to promote domestic production. American entrepreneurs, workers and investors will do the hard work. What those groups need to hear from Republicans in this election season are specific pro-growth policies and a message of optimism in regaining America's lost prosperity.
POSTPONING RETIREMENT INDEFINITELY - NYTimes
More than a third of adults near retirement age (35 percent) said last year they simply don’t expect to retire. That was up from just 29 percent two years earlier. More than four in 10 of these “pre-retirees” who don’t expect to retire say it is because they are financially unable to do so. They cite the need for extra income and the maintenance of employer benefits as the main reasons for continuing to work.
Gold prices rebounded toward $1,675/oz. Tuesday on safe haven buying and a weaker dollar. Confidence down, housing up, stocks struggle. Gold last traded at $1,667 an ounce, silver traded at $30.88 an ounce.
Consumer confidence fell to a nine-month low in August, U.S. consumers worried about the economy and job prospects. Meanwhile, U.S. home prices continued inching upward last month.
Driving much? It's going to cost you. Gas prices are about $3.75 a gallon, topping last year's $3.60 average price over the Labor Day weekend. But those wise enough to have converted paper dollars into silver witnessed their price of gas FALL over 50% since 1962. (see chart)
Why? Because both silver and gold have the missing ingredient from all modern paper currencies: A Store of Value. Savers love price deflation, while Fed and government leaders hate it, but love inflation, despite all comments to the contrary.
"GOP gets behind 'We Built It' convention theme," reports Fox News. Swiss America Chairman Craig R. Smith will be a guest live on Fox tonight at 8:45pm ET to discuss his impression of the GOP convention from the perspective of a small businessman. Tonight at 10pm ET Ann Romney and New Jersey Gov. Chris Christie will deliver keynote speeches.
GOLD AS WEALTH INSURANCE - Editor
Chicago Tribune reports... "$36 billion in Gulf Coast residential property at risk of flooding from hurricane Issac surges..." Hopefully Gulf coasters have their flood insurance, and their homeowners, and car, and health. Just one thing still missing: Gold offers wealth insurance for protection from the flood of paper money the Fed keeps creating, sending us $58,000 further in debt every second!
ERIC SPROTT CAUTIONS INVESTORS TO FEAR THE FINANCIAL SYSTEM - Mineweb
Eric Sprott warns investors to "Fear the Financial System." In a recent interview he mentions that it is time for people to take matters into their own hands and that means looking into precious metals equities as well as physical gold and silver.
THE TOP TEN REASONS THAT YOU SHOULD SUPPORT THE "GOLD COMMISSION" - Forbes
The Republican Party Platform’s call for the creation of a commission to evaluate restoring the link between the dollar and gold may prove to be the biggest upside surprise of the 2012 Presidential contest. If successful, a serious effort to chart a responsible path toward making the dollar as good as gold would provide the linchpin to restoring economic growth, low unemployment, entitlement reform and, as a consequence, balance to the federal budget.
BERNANKE SEES MORE SCOPE FOR EASING - Bloomberg
Federal Reserve Chairman Ben S. Bernanke said the central bank has the ability to take additional steps to boost the economy. “There is scope for further action by the Federal Reserve to ease financial conditions and strengthen the recovery,” Bernanke said in a letter dated Aug. 22 to California Republican Darrell Issa, the chairman of the House Oversight and Government Reform Committee.
A MARKET CORRECTION IS ON THE HORIZON - AlhambraPartners
Ben Bernanke will speak at Jackson Hole this week in a widely anticipated speech on the economy. It was at the same annual confab in 2010 that Bernanke essentially announced QE2 so the speech will be carefully parsed for hints of the third version. After that we’ll get a raft of economic data including the monthly read on the jobs market. Finally we’ll get the September meeting of the FOMC and German court ruling. All of these events have the potential to upset the bullish mood and investors would be wise, I think, to prepare themselves for some form of correction in the coming weeks.
I have been warning since the crisis that the Fed’s efforts to resolve our economic problems would eventually lead to stagflation. I think we are rapidly approaching that point and another round of QE might be the final nail in the coffin. The fact is that our problems are structural and require changes in fiscal and regulatory policy. They cannot be solved by monetary policy alone. We are about to repeat the mistakes of the 70s with similar consequences. Adjust your portfolio accordingly.
Gold prices took a breather Monday after rising 3% last week on safe haven buying after Fed stimulus news. Dollar weak, stocks gyrate. Gold last traded at $1,664 an ounce, silver traded at $30.73 an ounce.
WSJ reports, "Today is the day for folks to get out of harm's way," warning of potential impact from Tropical Storm Isaac today. "Republicans give way to Isaac on convention," says MarketWatch.
"Jackson Hole Likely To Disappoint," says Bloomberg, referring to Bernanke's speech to financial elites Friday.
THE GOLD PLATFORM - NYSun
News that the Republican platform is going to call for the establishment of a new Gold Commission is the most encouraging thing we’ve heard out of the convention about to gather in Florida.
That the GOP’s draft platform endorses the Fed audit is, combined with Governor Romney’s confirmation yesterday that he would like to see a new chairman at the central bank, a sign that things are moving fast. All the more reason to remember that the last time a Republican platform called for a gold standard was 1952.
General Eisenhower stood on the plank for the campaign but abandoned it once in office. So one of the tasks in the campaign ahead will be to hold the candidate to the plank of monetary reform platform being erected at Tampa. It has the potential to be a transformative moment, as the Federal Reserve approaches its centennial and Congress considers whether it wants to buy in for another generation of an irredeemable dollar.
"I too am encouraged to see Republicans have added a golden plank to the party platform this year, for the first time in 60 years," said Swiss America Chairman CRAIG R. SMITH.
"But the odds of restoring honest money in a world driven by dishonest, government-created money are remote. Therefore, I suggest Americans begin to put themselves on a personal gold standard NOW, before the economic weight of our trillions in debt drag down the dollar, stocks, and bonds further."
GOLD SET FOR BEST YEAR SINCE 2010 - Bloomberg
Gold is poised to climb the most in two years as prospects for additional economic stimulus by governments from the U.S. to China stoke demand for the precious metal as a bet against inflation, a survey showed.
Gold bullion for immediate delivery may reach $1,800 an ounce by year-end, extending gains this year to 15 percent. That would be the most since a 30 percent surge in 2010.
Gold is set for a 12th year of gains as the European sovereign-debt crisis boosts haven demand amid speculation of further policy easing by central banks, including the U.S. Federal Reserve. The FED may also be considering a third round of quantitative easing, or QE3. Investment holdings have expanded to a record on demand for a hedge against inflation.
THE MAINSTREAMING OF THE GOLD STANDARD - Forbes
Opponents of the gold standard have attacked and will again attack good money, especially gold, as “outside the mainstream.” That may be true for academic economists but it is simply not so for the rest of us. Rasmussen polled 1000+ voters last October, and its data revealed that almost all demographics approve of the gold standard. Historically speaking, sound money and gold represent very mainstream opinion.
2012 is by no means the first time that the gold standard has been addressed in political platforms. The GOP Platforms for Reagan’s 1980 and 1984 victories argued that “The severing of the dollar’s link with real commodities in the 1960s and 1970s, in order to pursue economic goals other than dollar stability, has unleashed hyper-inflationary forces at home and monetary disorder abroad, without bringing any of the desired economic benefits. One of the most urgent tasks in the period ahead will be the restoration of a dependable monetary standard….” In 1984: “A dollar now should be worth a dollar in the future. This allows real economic growth without inflation and is the primary goal of our monetary policy…. The Gold Standard may be a useful mechanism for realizing the Federal Reserve’s determination to adopt monetary policies needed to sustain price stability.”
In Eisenhower’s 1952 presidential election the GOP Platform called gold, “the standard of the most enlightened nations of the Earth.” Further back, William Jennings Bryan’s show-stopping “cross of gold” speech won him the 1896 nomination. It did not, however, win him the presidency. That went to William McKinley, who campaigned forthrightly for the gold standard on a GOP platform.
WHAT FED ACTION WOULD MEAN FOR THE DOLLAR - Smart Money
When the Federal Reserve hinted Wednesday more stimulus could be on the way, the dollar sunk. While it remains unclear how or when the Fed might act, investing pros say it may still make sense to dial back on the greenback.
Investors might consider balancing their domestic exposure with a stake in currencies and commodities that would benefit if the dollar dropped in value. Rick Scott, chief investment officer at L&S Advisors in Los Angeles, says he invests up to 10% of a client’s portfolio in gold, which tends to rise in price when investors worry about inflation.
WHEN A 401(k) IS LOCKED IN THE FREEZER - NYTimes
EVERYONE with a 401(k) knows that bad investments and high fees can threaten their retirement. But what if the company that sponsors your plan goes bankrupt? As the employees of one small company have learned, it can wreak financial havoc. They’ve gone nearly four years without access to their retirement savings.
Gold prices steadied Friday after rising 3% for the week on safe haven buying amid Fed stimulus news, dollar bounces, stocks like QE. Gold last traded at $1,670 an ounce, silver traded at $30.80 an ounce.
GOLD, SILVER & CRUDE OIL SET FOR REMARKABLE ADVANCES - KingWorldNews
Expert Tom Fitzpatrick believes that silver will quickly advance 23% higher than current levels. He also expects massive movements in gold and crude oil that will stun market participants. Fitzpatrick believes gold will outperform all paper currencies in the developed world.
GOLDEN TIME TO INVEST IN GOLD - Business2Community
Gold is widely known as the most secure investment into which you can put your money. It is unaffected by any decision any government in the world makes, making it an ideal safe haven. There has never been a better time to invest in gold due to the struggling eurozone and doubts about the world's economy.
REPUBLICANS EYE RETURN TO GOLD STANDARD - FinancialTimes
The gold standard has returned to mainstream US politics for the first time in 30 years. Drafts of the party platform call for an audit of the Federal Reserve monetary policy and a commission to look at restoring the link between and dollar and gold.
The move shows how five years of easy monetary policy – and the efforts of congressman Ron Paul – have made the once-fringe idea of returning to gold-as-money a legitimate part of Republican debate.
2016: A POWERFUL MOVIE - OCRegister
"2016" the new documentary film was fascinating, as Dinesh D'Souza presented the story of Barack Obama's life and view of the world in a very conversational sort of way. Illustrated by visits to people and places around the world that played a role in the way Obama's ideas and beliefs evolved.
What is Obama's ideological view? The Third World, or anti-colonial, view is that rich nations have gotten rich by taking wealth from poor nations. It is part of a much larger vision, in which the rich in general have gotten rich by taking from the poor, whether in their own country or elsewhere. The film opens in theaters nationwide today.
HOW THE SAFEST INVESTMENTS FOR RETIREES WENT WRONG - FiscalTimes
Retirees who put their money into low-risk investments like Treasuries and certificates of deposit (C.D.s) thought they were doing everything right. But the Federal Reserve’s decision to keep core interest rates near zero since December 2008 has hurt the nation’s retirees.
"Retirees who hold too much of their investment portfolios in cash also face the risk of inflation and a loss of purchasing power. Many seniors are so focused on trying to preserve their savings, they don’t notice they are losing ground when their expenses start rising because of inflation and their investment portfolios stay the same," according to Jack Ablin of Harris Private Bank in Chicago. “Inflation is one of the greatest risks facing retirees, said Ablin. “But it’s not one that you spot until it is too late.”
HOW THE TEA PARTY BEAT OCCUPY WALL STREET MarketWatch
The Occupy movement failed to live up to its promise as a social and political force. Once the crackdowns began, camps across the country fell and so did the movement's visibility. It promised a big summer revival, but their actions in the last three months haven't received much attention.
Gold prices rocketed near $1,675/oz. Thursday after bullish Fed news and stimulus talk, dollar falls, stocks sink. Gold last traded at $1,670 an ounce, silver traded at $30.56 an ounce.
Metals reached 4-month highs on the likelihood of more money creation by the Fed, which would further increase dollar weakness and inflationary backlash.
Why the rush to gold? Because precious metals have a 6,000 year track record of maintaining a store of value over time, unlike all government-created, confidence-based paper currencies.
GOLD & SILVER OFF TO THE RACES - GoldSwitzerland
Gold and silver have now started a major move to the upside. This move will be relentless with only minor corrections before we reach $4,500 to $5,000 in gold and substantially over $100 in silver.
Investors now have a last chance to invest in gold and silver at prices which will never be seen again. But for wealth preservation purposes it must be physical metals and it must be stored outside the fragile banking system.
Gold reveals governments’ deceitful actions in destroying the value of paper money and the wealth of nations. This is why most Western governments dislike gold. Because gold tells the truth and the truth is that since August 1971 the US dollar has declined 98% in real terms.
GOLD SURGES ON FED STIMULUS HOPES; HEADED FOR $2,000? - LATimes
Many now believe the haven metal might be poised to break through $2,000 an ounce -- which would be an all-time high -- based on what the Federal Reserve does when it meets Sept. 12-13. "There's the potential for China, Europe and the U.S. to all do QE at the same time this fall...It's the perfect storm."
GOLD TO RALLY AS CENTRAL BANKS, INVESTORS BUY - Bloomberg
Central banks will purchase close to 500 tons this year after becoming net buyers in 2009, according to the producer- funded World Gold Council. The reason they are positive on gold is because major currencies are lacking credibility.
“The natural buyers of today are emerging-market central banks, and over and above that, it’s going to be further investment demand,” said Dugan. “People continue to naturally gravitate to gold.”
LOST DECADE FOR SHRINKING MIDDLE CLASS - WSJ
The middle class — defined as households with between two-thirds and double the nation’s median income — has shrunk considerably over the past few decades, a decline been greatly exacerbated by the recession and housing bust, according to a new Pew Research poll.
In 2011, the nation’s middle class income bracket held 51% of households, down from 61% in the 1970s, according to this report released today by the Pew Research Center. Over the same period, both the upper and lower income brackets have grown. Pew notes that while middle class incomes fell over the 2000s decade, the bigger hit was falling home and asset values. The median middle class income fell 5% over the decade, but total wealth — assets minus debt — fell 28%.
Bloomberg Businessweek adds...
The Pew Research Center highlights diminished hopes, too, for the roughly 50 percent of adults defined as middle class, with household incomes ranging from $39,000 to $118,000. The report describes this mid-tier group as suffering its, "worst decade in modern history," having fallen backward in income for the first time since the end of World War II.
Gold prices shot above $1,650/oz. Wednesday after bullish Fed news including stimulus talk, dollar falls, stocks mixed up. Gold last traded at $1,654 an ounce, silver traded at $29.84 an ounce.
Get ready for QE3. Top officials of the Federal Reserve are leaning strongly in favor of a third round of bond buying, known as QE3, reports Marketwatch.
ARE GOLD CYCLES TURNING UP WITH EASY MONEY? - GoldIRAs
Spot gold prices have broken above important resistance at $1640.30, the first signal that a new up-leg is in progress. The next immediate challenge is a test of the September 2011 to August 2012 down-trend line, now at $1672, a break of which should trigger upside continuation to $1680-$1700, thereafter.
IS GOLD MONEY? LCH ACCEPTS SHINY YELLOW METAL AS COLLATERAL - ZeroHedge
London's LCH-Clearnet just announced that as of August 28th, unallocated gold will be accepted as collateral for margin cover purposes. This now means all the major exchanges accept 'worthless barbarous relics' (gold) as collateral - as well as worthless fiat paper 'money'. LCH-Clearnet is the leading independent clearing house group, serving major international exchanges and platforms, as well as a range of OTC markets.
FISCAL CLIFF WILL CAUSE RECESSION, CBO WARNS - CNBC
Massive spending cuts and tax hikes due next year will cause even worse economic damage than previously thought if Washington fails to come up with a solution, Congress' budget referee warned on Wednesday.
The Congressional Budget Office said failure to avoid the so-called "fiscal cliff" of expiring tax cuts and automatic spending reductions would cause the gross domestic product to shrink 0.5 percent in 2013.
THE BERNANKE CLIFF - 321gold
The so-called “Fiscal Cliff” slated for year-end is really nothing more than a speed bump compared to the real fiscal cliff the US is racing toward. The same one Europe has already dived over. That cliff is based on the collapse of the debt and dollar markets resulting from the lost faith of international investors. A loss that is being facilitated by the Fed.
The Fed has been inviting inflation since 2008 by systematically seeking to destroy the dollar. By printing trillions of dollars and threatening to print even more, Bernanke has not only decimated the currency but also ruined the purchasing power of the middle class. Worst of all, Bernanke has enabled the government’s fiscal irresponsibility. He has duped US leaders into believing they can borrow an unlimited amount of money at nearly zero cost indefinitely.
PAUL RYAN COULD MAKE HISTORY WITH BOTH MONETARY AND SPENDING REFORM - Forbes
"I’ve been asked if I have any regrets. Well, I do. The deficit is one."
— Ronald Reagan’s farewell address.
We need to restore vibrant economic growth as well as end federal profligacy. History demonstrates that sustained 4% growth is achievable, uniquely, through the classical gold standard.
THE FIAT WORLD - Gold-eagle
Today, the power of the state has corrupted society absolutely. The corruption isn't just at the upper echelons of society either. It's everywhere. Almost everyone and everything in the US today depends upon the state. The number of people on welfare, Social Security, Medicare, government employees and those in the military now total 252 million! (80% of U.S. population)
Thanks to decades of public indoctrination that would make Vladimir Lenin jealous and an onslaught of television programming, most people today don't even realize that almost everything has been stolen from underneath them and they are left holding worthless items instead.
Gold prices rushed toward $1,650/oz. Tuesday on stimulus hints and sharply weaker dollar, stocks zig-zag lower. Gold last traded at $1,638 an ounce, silver traded at $29.31 an ounce.
"When a major global player like George Soros with direct ties to the White House, Wall Street, and the banking system starts off-loading stocks and starts stacking gold, it suggests a very serious market move is set to happen," observed commentator Mac Slavo, in The New American.
GOLD RISES ON STIMULUS HINTS, WEAK DOLLAR - Marketwatch
Gold prices took a jump on Tuesday after China hinted fresh economic stimulus could be on the way in the next few months. Precious metals prices also rose on dollar weakness due to hopes the European Central Bank will step up their efforts to help euro-zone countries.
"The big money is accumulating gold while the price is dropping," reports iStockAnanlyst. Out of the 224 hedge funds and large money managers, 153 initiated or added to their positions in the SPDR Gold Shares.
CENTRAL BANKS' GOLD DEMAND HEATS UP - FrankHolmes
The two largest gold buyers in the world that largely drive the Love Trade, China and India, underwhelmed the metals market with their subdued demand for the yellow metal during the second quarter of this year.
A relatively new gold buyer has been warming up to gold. The WGC reported that central bank purchases hit a record high since the official sector became gold buyers three years ago.
There’s been a lot of discussion from market pundits wondering where gold is heading.
Using the last 10 years of data, if you plot the 12-month rolling return, this chart (above) shows gold has reached an extreme low. The last time gold reached this point was in August 2008. You can see below the yellow metal’s significant climb after hitting that standard deviation low.
REDEFINING TRADITIONAL RETIREMENT - USNews
Some of the most fortunate people in the world never retire. For example, Elizabeth Windsor, at age 85, is still going strong as Queen of England. Warren Buffett, 81, remains chairman and CEO of Berkshire Hathaway.
Not all of us have the option to keep our jobs for as long as we want. Some of us belong to a different, but equally exclusive club - people who were forced to retire at a fairly young age.
In the end, the reasons to work in retirement are the reasons why you work at any other time in life. For the money, maybe. But also to have some structure in your life. To make friends. To feel like you're doing something useful. To belong to a group that's bigger than yourself. To actually make a difference in the world.
YOU NEED TO ASK THESE QUESTIONS IF YOU WANT TO RETIRE - BusinessInsider
1. Do I really ever want to retire?
2. How long will I live?
3. How much income am I really going to have? How much will I spend after I retire?
4. Do I have the best asset mix for creating enough income?
5. How much will I be able to help my children?
6. Do I need to make any changes now in order to increase the likelihood of retirement success?
7. Am I willing to do what is necessary to better secure my retirement? How To Rebuild Your Nest Egg with Gold - Free Offer
Gold prices inched toward $1,625/oz. Monday on bargain hunting and weaker dollar, stocks gyrate on uncertainty. Gold last traded at $1,621 an ounce, silver traded at $28.83 an ounce.
News Briefs: - Editor
-NEWSWEEK GOES MAD... says DrudgeReport: "Obama’s Gotta Go"
-Gallup Poll: 56% not better off now than in 2008... up from 54% in late 2011. -Fed Could Pull Trigger to Save Economy Wednesday, reports WSJ.
-Goldman to Clients: Get Out of Stocks Before Fiscal Cliff Hits, according to CNBC.
-Marketwatch warns Americans should, "Get ready for another food crisis".
-Chinese fund managers gearing up to launch gold exchange-traded funds, says Reuters.
-"Debt is money that has already been spent. It is like sin; it may be fun when you are doing it, but there’s always a price to be paid later on." -Bill Bonner
BIG CHANGES AHEAD: GOLD JUST BECAME MONEY AGAIN - FeaturedCommentary
A momentous change for the gold market. Now banks will be allowed to hold bullion in their vaults and count it among their Tier 1 assets – in other words, the least risky assets.
As banks that recognize gold's unique characteristics seek to stockpile more of it. Bank's Tier 1 holdings must rise from 4% of assets to 6%.
That means that banks may not only replace a portion of their existing paper with bullion, but may use it to meet some of the extra 2% as well. In addition, this vote of confidence from the highest monetary authorities gives further impetus to the remonetization of gold.
A FIFTH DECADE INTO THE UNCHARTED TERRITORY OF PAPER MONEY - CapitalistAdvisor
August 15, 1971 still matters. Forty-one years ago last week – on August 15, 1971 – the U.S. dollar enjoyed its last formal link to gold, a link that was deliberately broken that day by U.S. president Richard Nixon, when he yanked the dollar out of its central post in the Bretton Woods international monetary system (established after World War II, in 1946).
Perhaps the biggest myth associated with central bankers is that they care deeply about “fighting inflation.” The false claim also implies that central bankers are not the cause of inflation. Nothing could be further from the truth. (FREE White Paper: Surprising Facts from 'RE-MAKING MONEY: Ways to Restore America's Optimistic Golden Age'
WHY WE DON'T 'OWE IT TO OURSELVES' - AmericanSpectator
"We owe it to ourselves." With five talismanic words, in 1932 FDR and planners had disposed of the problem of deficit spending. Tax and tax, spend and spend, elect and elect…
In actuality, "We owe it to ourselves" is one of those deceiving little pieces of rhetoric whereby liberals put their arm around you and pat you on the back while picking your pocket.
The national debt is not owed "to ourselves." It is owed to bondholders who have loaned money on the understanding they are going to be paid back.
Next time you read one of Paul Krugman (NY Times) columns saying how spending borrowed money is the only way to end a recession, drop him a note saying the following:
"Hey Paul, I'm having a little trouble paying the rent this month. Do you think you could loan me a couple of thousand dollars? It'll carry me over and maybe in a while things will get better. And as far as paying you back -- well, look, we're all in this together, right? We'll owe it to ourselves."
FOR MANY BOOMERS, 'RETIREMENT AGE' IS A MOVING TARGET - KansasCityStar
In 1991, just one in 10 workers told the Employee Benefit Research Institute that they planned to wait to retire until they were older than 65. By 2007, three in 10 said that. This year? More than four in 10.
Overall, the stage is set for a new normal: Working in retirement. This year, 18.6 percent of those 65 and older were participating in the labor force, compared with 13 percent in 2002.
Baby boomers — representing slightly more than one-fourth of the U.S. population — are hitting age 65 at the rate of 10,000 a day. One in every four 65-year-olds today will live past age 90, and one in 10 will live past 95.
Among Americans in their 60s and older, a Transamerica Center for Retirement Studies survey found an average of just $47,000 in household retirement account savings. Experts say that’s frighteningly low.
How much should be saved for retirement by the time you’re 66? The answer depends on income and lifestyle. One guideline suggests taking your final working salary and multiplying it by 11. If your salary is $50,000, that recommends you save more than half a million dollars by the time you retire in order to maintain your lifestyle.
Consider, too, that more than one-third of Americans say they’re living paycheck to paycheck, according to the Consumer Federation of America. That leaves no savings cushion at all.
Gold prices steadied above $1,600/oz. Friday on bargain hunting despite a firmer dollar, stocks rally on upbeat earnings news. Gold last traded at $1,615 an ounce, silver traded at $28.10 an ounce.
CRAIG SMITH ON YOUR WORLD WITH NEIL CAVUTO - FOX NEWS
Swiss America Chairman Craig R. Smith today responded to the president's latest effort to spend our way to prosperity by using $239 billion to refurbish roads and bridges. Speaking for small businessmen, Smith said "We need certainty!" to regain confidence to hire, not spending.
"Should 77 Million Boomers Say Bye to Retirement?" asks CNBC. "Between inflation and consistently pitiful yields, retirement planning has become a Herculean task...a large majority of baby boomers won't have enough assets to last the duration."
WILL YOU EVER BE ABLE TO RETIRE? How to Escape ‘Retirement Age Inflation’ - NewsRelease
Comics joke that “80 is the new 65,” but for millions of Americans, it's no laughing matter.
New retirees today are the first generation who will receive less in Social Security benefits than they paid in, according to a new analysis by the Associated Press. People who retired in 1960 could expect seven times more in benefits than they’d paid, depending on how long they lived, and as recently as 1985, workers at every income level could expect to get more than they paid in Social Security taxes.
With the baby boomers hitting retirement age this year, it’s only going to get worse for the Social Security system. The bottom line is that people have to take smart steps to secure their own retirement.
Did you know individuals may transfer an existing Traditional IRA to a qualified gold IRA with no penalties? Plus Precious Metal IRA's have grown in value by 240% in the last 5 years!
AAAAND IT'S GONE: THIS IS WHY YOU ALWAYS DEMAND PHYSICAL - GoldIRAs
Some investors prefer to investing in gold in a paper form. Like all invested capital, it is at risk of total loss. There have been many examples to show that investing this way has its downfalls, just look at Lehman, MF Global or Peregrine. Physical gold and silver is the only way to invest in precious metals.
WSJ reports, "This week's collapse of a gold-derivatives business that Polish regulators say was a Ponzi scheme has hit tens of thousands of customers, shaken confidence in the effectiveness of the nation's financial regulation, and is roiling national politics in the European Union's largest emerging economy."
EUROZONE BETTING THE HOUSE TO SAVE THE GARAGE - BusinessInsider
According to NYU economist Nouriel Roubini, he believes that the policymakers in Europe are causing imbalances that could make a eurozone breakup very painful down the road. According to Roubini, "If a breakup can't be avoided, delaying the inevitable would merely make the endgame worse."
RAND PAUL’S TEA PARTY MANIFESTO - DailyReckoning
Politics is a lagging indicator of social-cultural trends. Politics doesn’t lead change; it chases it, incompetently and long after the underlying reality is impossible to deny. This is why it makes no sense to put faith in politics. By the time politics catches up, the rest of the world has moved on.
That said, I’ve just finished what might be the finest book ever written by a sitting member of the US Senate. It is daring. It is intellectually serious. It displays mastery of the subject matter. It makes courageous and counterintuitive claims, such as the need for across-the-board cuts in all spending, including military spending and middle-class welfare, by raising the retirement age. It takes on taboo subjects like the war on terror to call for normalcy and peace.
Gold prices rose 1% above $1,600/oz. Thursday on bargain hunting and a weaker dollar, stocks rally on upbeat earnings news. Gold last traded at $1,615 an ounce, silver traded at $28.21 an ounce.
Stocks rose as the dollar fell, and US Jobless Claims edged higher. Housing Starts dropped while oil holds near 3-month highs. Facebook fans took a beating today as insiders sold off shares at a 40% loss.
Meanwhile company executives are delaying decisions on everything from hiring to plant-building until they get clarity from Washington on the looming "fiscal cliff," according to an analysis by Goldman Sachs.
FACEBOOK STOCK HITS ALL-TIME LOW - CNNMoney
Facebook's life as a public company has been a nightmare from day one, and the pain continued on Thursday as some company insiders got their first chance to dump shares. Facebook stock fell nearly 7% Thursday morning, hitting a new intra-day low of $19.69.
BILLIONAIRES BET BIG ON GOLD - ABCNews
Once again John Paulson is choosing to heavily invest in gold and fellow billionaire George Soros is making a similar bet. According to Bloomberg News, Paulson & Co. and Soros Fund Management bumped up exposure to SPDR Gold Trust to 21.8 million shares and 884,000 shares, respectively. Paulson & Co. now has 44 percent of its $24 billion fund exposed to bullion.
GOLD AND SILVER IN SHORT SUPPLY, HIGHLY LEVERAGED IN CURRENCY WAR - Mineweb
Ron Struthers, editor of Struthers' Resource Stock Report, tells Mineweb that his indicators say gold will soon move easily above $2,000 an ounce, taking silver higher with it. He expects this move to last over a six-month period with higher inflation and excess money printing.
NEW 3.8% OBAMACARE TAX DISTORTING MARKETS - FoxBusVideo
If you sell an asset after January 1, 2013 you will pay a 3.8% surcharge on the capital gains. Bob Knakal of Massey Knakal Reality Services tells Fox News this new tax affects not just the rich. For example, if you sold a $50,000 home you will pay both regular Capital Gains Tax PLUS an additional 3.8% surcharge to cover the costs of Obamacare. Smart investors are selling real estate and going for gold.
FORGET WASHINGTON: HERE'S HOW WE'D FIX THE ECONOMY - Fortune
America's leaders aren't leading and the damage is mounting. Millions can't find work, confidence withers, growth slows, and the self-reinforcing upward spiral that makes an economy grow can't get going. Largely because our supposed leaders won't grow up.
The largest elements of unsustainable spending are America's biggest social insurance programs, Medicare and Social Security. Social Security is emotional but is primarily about numbers. But Medicare is emotional times 10 -- it's about who lives, who dies, and who pays for it.
We're proposing major tax and budget reform. Some people would argue it can't possibly happen. Major reforms happened under Presidents Kennedy and Reagan, and if our country gets a big enough scare, they could happen again. These things have their moments. As the economy cries out for help, just maybe the moment has arrived.
Gold prices steadied near $1,600/oz. Wednesday on bargain hunting, stocks zig-zag on mixed data. Gold last traded at $1,603 an ounce, silver traded at $27.83 an ounce.
"No 'QE3' in September?," asks Marketwatch. Better-than-expected data has raised doubts the Fed will ease at Sept 13th meeting. Meanwhile, Empire State factory gauge is in negative territory, the official CPI was "unchanged" in July, but Homebuilder Sentiment hit a five-year high.
THE TRUE U.S. INFLATION RATE BETWEEN 5-8% - Shadowstats
The chart above shows one of two SGS-Alternate CPI estimates: Based on the pre-1990 official methodology for computing the CPI-U, the true inflation rate in 2012 is 5%, not under 2% as the CPI reports. Based on the methodology employed prior to 1980, the true inflation rate in 2012 jumps to 8%!
DROUGHT-RELATED FOOD INFLATION WILL FEEL BAD BUT NOT DISASTER FOR ECONOMY - CNBC
“It will take a while to feel the full effect,” said Diane Swonk, chief economist at Mesirow Financial. “It’s coming, and it’s going to be in dairy products, eggs, meat, and people are going to be making tradeoffs in the grocery store but it won’t show up in the CPI.”
The drought has resulted in a severely diminished corn crop (prices have jumped more than 50 percent since June) and a smaller-than-expected soy bean crop this year. It has also led livestock farmers to slaughter more of their herds than normal, to reduce the impact of feed costs.
Economists expect food inflation should be temporary and a relatively small hit, when compared to energy inflation. Rising food prices may not put much pressure on CPI but the affect will show up in consumption data and it is important to people living paycheck to paycheck to put food on the table.
HOW MUCH WILL IT COST YOU IF BUSH TAX CUTS END? A LOT - CNBC
Americans would shell out as much as $5,700 more a year if the Bush tax cuts are allowed to expire at the end of 2012, according to a new analysis that highlights the perils and political consequences of the nation's fiscal cliff.
"This is the biggest tax increase that would happen since World War II," said Will McBride, chief economist at the Washington, D.C.-based Tax Foundation. "I can't think of anyone who's really seriously thinking we should go through this. It would almost certainly result in another recession."
Economists estimate that if Congress does not reach agreement on the items it will siphon between $400 billion and $720 billion from growth, representing as much as 4.6 percent of total gross domestic product.
At the start of the 20th century our true history was rewritten (“revisionist history”), and has since been forgotten. As C.S. Lewis says, “It is the forgotten past that enslaves us.”
Gold prices eased back near $1,600/oz. Tuesday on short-term profit taking, stocks timidly rise amid mixed earnings. Gold last traded at $1,599 an ounce, silver traded at $27.83 an ounce.
Producer prices jumped .3% while retail sales rose .8% in July. "A very possible tax hike, policy changes and rising health care costs have many investors planning to adjust their portfolios by year end," reports Marketwatch.
Meanwhile, KingWorldNews reports, “Right now we are seeing very large physical orders for both gold and silver. These are wealthy individuals that are very strong hands and they are taking the metal right out of the market, these individuals are never sellers."
"The world’s assets are about $150 trillion. $60 trillion is in cash, $40 trillion is in bonds, and $40 trillion is in stocks. But only $2 trillion, or just a bit over 1%, is in gold," says Egon von Greyerz.
"The next step is for gold to break above $1630 and silver to break above $28.30, and when it happens it will signal their long awaited breakout from these 3-month bases," says James Turk.
Most observers don't expect Congress to reach an agreement before the November elections. In January, $1.2 trillion in automatic spending cuts are set to begin. Now is the time to protect your assets from a looming tax and fiscal cliff. Call your Swiss America broker at 800-289-2646 to discuss how U.S. gold and silver coins can help preserve wealth.
STAGE SET FOR GOLD TO GO HIGHER - AND SILVER EVEN BETTER - Mineweb
John Doody, an economics professor, is predicting that gold will be seen around $2,000 an ounce this year. The U.S. real rate of return is negative and this number will eventually come to the fore and drive gold prices higher. Doody suggests to his subscribers to have portfolios of one-third cash, one-third gold and one-third the GSA top 10.
ECONOMIC LESSONS FROM THE OLYMPICS - WashTimes
Do you admire what the Olympic athletes have been able to accomplish, and do you think they should be applauded for their outstanding performances? Most people in the world would answer the question in the affirmative.
Civilization can only advance when individuals are both encouraged and rewarded for excellence. The good side of humanity is revealed when we praise and reward such people. The bad side of humanity is shown by those who wish to punish success.
A society that rewards envy and punishes success is not kind, fair, or pleasant. A society that rewards excellence with acclaim, and yes, money, will see more excellence that lifts and betters everyone.
INVESTORS PREPARE FOR EURO COLLAPSE - DerSpeigel
Banks, companies and investors are preparing themselves for a collapse of the euro. There is increased anxiety mostly due to politicians not being able to solve the problems and there is a growing sense of resentment in both the borrowing and lending countries.
Gold prices consolidated recent gains Monday on short-term profit taking, stock run halted by earnings, outlook fears. Gold last traded at $1,609 an ounce, silver traded at $27.83 an ounce.
This weekend's announcement of Paul Ryan as Mitt Romney's choice for V.P. could have some potential implications for risk assets over the next several weeks and months. Political policies that might slow growth are likely to be gold-bullish, forcing the Fed to keep its loose monetary policies in place.
1873 DIME SELLS FOR A PRETTY PENNY: $1.6 MILLION - ABCNews
A dime made in 1873 has cost someone a pretty penny: It sold for $1.6 million at auction. The rare coin was minted in Carson City, Nev., during a one-day run of dimes. The 1873-CC "No Arrows" Liberty Seated dime was part of the Battle Born Collection, which contained one of every coin struck in Carson City before the mint there closed in 1893. All 111 pieces were auctioned fetching a total of nearly $10 million.
U.S. GOVERNMENT DEBT GROWS $10 MILLION A MINUTE: DAVID WALKER - Yahoo!Finance
Total public debt, excluding student loan, mortgage and credit card debt, exceeds $15.9 trillion. The national debt has been growing faster than GDP and some experts are saying the debt burden could push the country towards insolvency over the next few decades.
U.S. BANKS TOLD TO MAKE PLANS FOR PREVENTING COLLAPSE - Reuters
Regulators directed five of the country's biggest banks, including Bank of America Corp and Goldman Sachs, to develop plans for staving off collapse if they faced serious problems, emphasizing that the banks could not count on government help.
Five years after the financial crisis, concerns remain about whether blow-ups at big banks could lead to another round of taxpayer bailouts. Spokespeople for the five banks declined to comment. The Federal Reserve also declined to comment.
Craig R. Smith commented, "Why is this plan being made public now? And why is there a six-month deadline on it? The best way for citizens to prepare for such an event is to own physical gold and silver not tied to the banks."
WHICH VISION WILL AMERICANS EMBRACE? - Editor
At a fundraiser in Chicago on Sunday President Obama asked, "Do we go forward towards a new vision of an America in which prosperity is shared?" Obama asked. "Or do we go backward to the same policies that got us in the mess in the first place?"
Rep. Paul Ryan (R-Wis.) said last Friday at the Romney campaign event announcing him as the VP, "America is just more than a place, though. America is an idea. It's the only country founded on an idea. Our rights come from nature and God, not from government. That's right. That's who we are, that's how we built this country. That's who we are. That's what made us great. That's what made us great. We promise equal opportunity, not equal outcomes."
A Wall Street Journal Op-Ed by Stephen Moore reports, "With Mr. Ryan on the ticket, there will be little doubt that in 2012 Republicans are the party of hope and change, while Democrats have become the policy reactionaries touting a message of fear and the status quo."
WND.com reports, "This is the end of the Romney campaign,” says national radio talk show host Michael Savage. "As good a man as he is, Ryan will be portrayed by the Marxists as another rich white male who wants to ruin the environment, destroy Medicaid and Social Security and give tax breaks to the very rich. But radio giant Rush Limbaugh says he’s 'jazzed' about Mitt Romney’s choice of Paul Ryan to be his running mate, and he expects an instant economic recovery if the Republican ticket wins in November."
GREAT RECESSION IS TURNING INTO A LIFE SENTENCE - Telegraph
China is sufficiently alarmed by the flint hardness of its "soft-landing" to talk up trillions of fresh stimulus. The European Central Bank is preparing to print "whatever it takes" to save Spain and Italy. Markets are pricing in an 80 percent chance of yet more printing by the US Federal Reserve in September or soon after.
The `Austrian School' is surely right as well to argue that a rise in debt ratios across the rich world from 167% of GDP to 314% in just thirty years was bound to end badly. There comes a point when extra debt draws down prosperity from the future. The future arrived in 2008.
Much of the debt will have to be written off. Whether this done by inflation (1945-1952) or default (1930-1934) will be the great political battle of this decade. Pick your side. Pick your history.
Gold prices closed higher on Friday on investors' hope for more stimulus and a weaker dollar, stocks jump on disappointing Chinese trade data. Gold last traded at $1,623 an ounce, silver traded at $28.13 an ounce.
Gold prices closed the week with a .8% gain on stimulus promise and the accompanying fears of currency debasement, boosting gold's role as a currency alternative.
Gold Bulls Strengthen on Outlook for Additional Stimulus -Business Week
Gold traders are the most bullish in five weeks as speculation grows that central banks will have to do more to bolster economic growth. Fifteen of 30 analysts surveyed said they expect prices to rise next week, eight were bearish and seven were neutral, making the proportion of bulls highest since July 6.
China reported weak industrial-production growth while US and Europe's manufacturing contracted leading to the belief the Fed will do more to stimulate the economy. “More stimulus or money printing is almost certain given the levels of debt out there which is slowing down economic growth,” said Mark O’Byrne, the executive director of Dublin- based GoldCore Ltd.
Gold has risen 2.9% this year extending its rally to 11 consecutive annual gains. This compared to a 2 percent gain in the Standard & Poor's GSCI gauge of 24 commodities and a 7.6 percent advance in the MSCI All-Country World Index of equities.
U.S. banks told to make plans for preventing collapse - Reuters
U.S. regulators have directed five of the country's biggest banks to develop plans for staving off collapse if they faced serious problems, emphasizing that the banks could not count on government help. This is showing how hard regulators are working to ensure the banks have plans for worst-case scenarios.
According to documents obtained by Reuters, the Federal Reserve and the U.S. Office of the Comptroller of the Currency first directed five banks to come up with these "recovery plans" in May 2010. They told banks to consider drastic efforts to prevent failure in times of distress, including selling off businesses, finding other funding sources if regular borrowing markets shut them out, and reducing risk.
US drought threatens food price surge - Financial Times
The worst drought in the US in at least half a century has destroyed one-sixth of the country's expected corn crop. Soybeans, used for animal feed and vegetable oil, also suffer with the harvest at the lowest in five years. The US Department of Agriculture forecast prices for the two crops to break records this year.
“We’re going to see very high prices,” said Joseph Glauber, USDA chief economist.
The failure of the US corn crop will hit the world’s food manufacturers, including Nestle, Kraft, and Tyson, who have already warned that they will pass on higher prices to consumers.
U.S. Government Debt Grows $10 Million a Minute: David Walker-Yahoo! Finance
Total public debt; excluding student loan, mortgage and credit card debt, exceeds $15.9 trillion. The national debt has been growing faster than GDP and some experts are saying the debt burden could push the country towards insolvency over the next few decades.
There are several factors that have caused the federal debt to soar to these levels including tax cuts, the wars in Iraq and Afghanistan, the TARP program and stimulus spending in 2008. Because of the economic slowdown, governments have also taken less revenue from businesses and individuals.
According to David Walker, former U.S. Comptroller and CEO of the Comeback America Initiative, the U.S. government owes $70 trillion, and grows at a rate of $10 million a minute. "The biggest deficit this country has today is not a budget deficit but a leadership deficit," Walker says. "Our elected officials are not talking about the tough choices. Washington is badly broken."
Gold prices closed modestly higher on Thursday on news of Chinese economic data that support the possibility of further monetary easing, stocks report mild gains. Gold last traded at $1,617 an ounce, silver traded at $28.14 an ounce.
U.S. drought drives up food prices worldwide - Yahoo! Finance
As the United States deals with the worst drought its seen in a half-century, farmers must contemplate mowing their cornfields. The lack of rain this season has led to crop shortages and has therefore caused prices to skyrocket. Federal meteorologists have even said this drought is the most widespread the US has had to endure since 1956.
As corn and soybean crops continue to wilt in the sun, market prices for the crops have skyrocketed, which threatens to shoot up food prices in grocery stores and foreign markets. In communities built on agriculture, "a bad year for farmers is bad news for everyone" as many continue to deal with the unforeseen losses.
Gold Climbs as Slower Chinese Inflation Fuels Stimulus Optimism- Bloomberg
Gold prices jumped higher on Thursday after reports of slowing Chinese inflation and an expectation of rising US jobless claims. This caused optimism that central banks might take steps to stimulate the economy. Gold rose .2% to its one-week high of $1,615 an ounce.
"There is still QE thinking in the background of gold prices,” said David Lennox, a resource analyst at Fat Prophets in Sydney, referring to quantitative easing. “It won’t go away until we see the U.S. in full recovery mode. That’s certainly not happening at the moment.”
The Federal Reserve has announced it would add stimulus if necessary in order to boost growth and lower the unemployment rate, which has been higher than 8% over the past three years.
How the Rich Will Lose Half Their Money - Smart Money
Marc Faber warns that massive wealth destruction is coming and the the Super-Rich "may lose up to 50 percent of their total wealth." Faber explains this will happen either through very high inflation, social unrest, war or a credit-market collapse.
Faber continues to say things will get "possibly much worse" before they get better and expects continued weakness in the second half of 2012. Faber says the collapse will be caused by Federal Reserve Chairman Ben Bernanke and the continuous printing of new money.
Gold prices steadied above $1,600/oz. Wednesday on a firmer dollar and pathetic GDP uptick, stocks mixed on earnings. Gold last traded at $1,612 an ounce, silver traded at $28.05 an ounce.
US productivity rose 1.6% in the second quarter after a decline of .5% in the first quarter of 2012, reports Marketwatch. But can these statistics be trusted! Meanwhile, CBNC reports, "Housing Is at a Bottom" according to Zillow CEO.
BEWARE THE FLAWED STATISTIC THAT IS GDP - Forbes
In the first place, it is hard to know which GDP numbers to trust because they are often calculated using inaccurate data and are subject to perpetual revision. Additionally, GDP includes large amounts of government spending, which by nature does not reflect real productive activity. Such spending is not funded by the voluntary purchases by those who earned the money, but by taxes forcibly taken from them.
To understand our current economic situation we must distinguish between a sustainable recovery and one which is as artificial as the flavors in the Kool-Aid being drunk by spendthrift politicians and the Keynesian intellectuals who enable them.
The conventional media definition of a recession is two or more successive quarters with GDP contraction. A single uptick in GDP, therefore, signals recovery according to this way of thinking.
GOLD QE - FinTmies
QE3 in its conventional guise — freshly minted base money in exchange for US government bonds — might not really be an option due to the squeeze it causes in the US Treasury market.
The idea that the Treasury could once again become the gold buyer of last resort, in exchange for liquidity, is interesting to say the least. Not only would such a strategy ease the squeeze in the Treasury market, it would do so without compromising the liquidity effects of QE.
What’s more it could help to support and stabilize the gold price, while taking zero-yielding safe assets out of the system in favor of yield bearing ones — giving money markets a fighting chance for survival in terms of yields. While gold purchases have never been communicated as official central bank policy, there’s no denying that a shift in this direction is taking place..
FISCAL CLIFF LOOMS LARGE AS CONGRESS LEAVES TOWN - CNBC
Congress has departed on a 5-week vacation and has left a mountain of unfinished work. There is also growing anxiety that lawmakers and President Obama will be unable to get their act together in time to avoid slipping off the fiscal cliff at the end of the year.
With few exceptions, the two parties will attempt to preserve the status quo through the November election - and then decide whether it makes sense to make quick deals on the budget and taxes or wait until a new Congress and possibly a new president take office next January.
THE TRUE COSTS OF THE GM/UAW BAILOUT - IBD
The Obama administration has claimed that they are responsible for saving the auto industry. However, according to the article, the administration only saved the industry's dominant union while weakening capitalism in the process. Under Obama, two of the big three auto makers did go bankrupt and many costs were incurred in the process.
The Obama team may claim to have saved iconic American businesses. But taking over any company to give labor a leg up on capital - call it crony socialism if you will - sets a precedent that threatens businesses of all kinds.
Gold prices inched higher Tuesday on bargain hunting and a flat dollar, stocks high on earnings despite ominous outlook. Gold last traded at $1,611 an ounce, silver traded at $28.12 an ounce.
GOLD AND SILVER REMOVE THIRD PARTY RISK - ArabianMoney
Recently Knight Capital reported a $440 million loss due to a software malfunction. This is a reminder of why holding physical gold and silver in your portfolio is a good idea. The value of metals does fluctuate daily, but it will always be there because you do not have a third party between you and your wealth.
Increasing the supply of paper money while the supply of gold and silver remains fixed can only have one result, higher prices for precious metals. And at most we can only be one crisis away from that happening. Then third party risk will truly be back on the agenda and gold and silver’s true value will be evident to all.
BUSINESS FEARS THE OBAMA CLIFF, NOT THE FISCAL CLIFF - IBD
As the election gets closer, more and more news outlets are picking up on the theme that a political impasse in Washington is the biggest risk to the economy because it will result in huge tax hikes and spending cuts next year.
There's no doubt that inaction means trouble. Unless Congress does something, all the Bush tax cuts will expire, boosting taxes by $221 billion next year alone. The real problem businesses face isn't gridlock in Washington, lawmakers are sure to strike a deal before years' end, its the potential of an Obama reelection.
Businesses know a second Obama term will mean: higher taxes, more debt, more regulations and ObamaCare with its massively expensive mandates, taxes and regulations. With Obama continuing to do well in the polls, it's no wonder businesses are hunkering down today.
OBAMA: ROMNEY WANTS VP PETRAEUS - DailyMail
The Drudge Report cites an unnamed source who overheard President Barack Obama talking about Mitt Romney's desire to name Petraeus as his running mate.
It remains to be seen whether the four-star general, who is currently the director of the Central Intelligence Agency, would even agree to such a proposition. In previous interviews he has said he has no interest in jumping into the political arena.
If Petreaus were tapped to be the Republican vice presidential nominee, it could shift the entire balance and momentum of the election -- electrifying Romney's campaign by picking a man regarded by most of the nation as a war hero.
Gold prices rose Monday on bargain hunting and a flat dollar, stocks rise on earnings amid EU relief. Gold last traded at $1,610 an ounce, silver traded at $27.86 an ounce.
IF HYPERINFLATION AHEAD GOLD TO $10,000 - IF DEFLATION, $2,000 - Mineweb
Jay Taylor is a well-respected publisher of the miningstocks.com website. Taylor believes we are in a gold bull market of a lifetime. Taylor says many experts believe the debt crisis will end in hyperinflation and will cause gold to ultimately rise to $10,000 an ounce.
If a period of deflation is ahead, Taylor reckons, gold may ultimately rise to only say, $2,000. But in either scenario Taylor points out that to the investor in gold the net result is much the same in terms of the yellow metal's purchasing power relative to prices in general.
Despite all the anti-gold propaganda, there is no reason to doubt we are in the bull market of a lifetime for both gold and mining shares. Very soon we are going to see a dramatic increase in both the real and nominal price of gold.
DIVING FOR SUNKEN GOLD AT SD BOAT SHOW - TV6 - Watch Video
Last weekend the San Diego Yacht and Boat Show bought out not only the experts on the latest in sailboats, yachts, scuba, paddle boarding and kayaking, but also the experts on gold, Swiss America.
In addition to the hundreds of luxury yachts, sailboats and fishing boats in the Sheraton Marina harbor, Swiss America was manning a booth inside discussing how to prepare a financial life boat for rough waters ahead. In the video linked above you can see Swiss America representative Phil Gordon answering a few questions while girls scuba dive for gold coins.
THE FRAUD THAT WAS FRIDAY'S JOBLESS REPORT - NY Post
It’s cheatin’ time in Washington. I’ve long believed the Labor Department’s monthly employment statistics are horribly inaccurate. So bad, in fact, that they are hardly worth compiling. But I never thought the numbers were fudged — until now.
The government reported yesterday that 163,000 jobs were created in July and that the unemployment rate rose by 0.1 percentage points to 8.3 percent.
Each month the Dept. of Labor guesses at the number of jobs it thinks are being created by newly formed companies it really can’t prove actually exist. This is called the birth/death model. Yesterday’s report included the addition of 52,000 phantom jobs.
Gold prices rose Friday after U.S. employment data showed a rebound in hiring last month, dollar falls and stocks rally on economic data. Gold last traded at $1,604 an ounce, silver traded at $27.80 an ounce.
Gold declined .5% on the week but many experts and analysts still see signs of strength in the metal and are confident that the fears about the financial system combined with a lower dollar create a positive environment for gold's traditional role as a safe haven investment.
GOLD TO RALLY ABOVE $1,900 BY END 2012: HSBC- CNBC
As the "fiscal cliff" approaches, experts believe gold could be one of the few assets to profit from political and economic turbulence. Analysts at HSBC say that this could potentially create a rally in metals in late 2012 and cause gold prices to hit as high as $1,900 an ounce.
Some factors that could contribute to the bullish case for gold include geopolitical tensions and the uncertainty of the U.S. November elections. According to the report released by HSBC, “when U.S. growth is poor and the dollar is weak, we expect prices to rally to above $1,900/oz by the end of the year. Patience is the most important commodity.”
HSBC recommends that investors hold on to gold as a safe haven asset that will gain in value as fear continues to grow over the future of the euro and dollar. Many are predicting that governments and central banks will intervene and do more to stimulate their economy and strengthen their currencies.
HIRING CLIMBS BUT JOBLESS RATE TICKS UP - WALL STREET JOURNAL
The US economy has added more jobs in July than in any other month since February. The employment rate however, still continued to climb, signaling that the US recovery still remains too weak to bring down high unemployment.
The report sent stocks to a three-month high. The Dow Jones Industrial Average climbed 1.7% to its highest level since early May. The report provides the latest evidence that the economy lacks the momentum to make a dent in the unemployment rate and according to Stephen Stanley, chief economist at Pierpont Securities, "We're not falling down, but we're also not making up any ground. We're not getting any closer to a normal type of employment reading."
Many analysts expect some kind of action from the central bank before their next meeting, who now appear poised to launch a new round of stimulus should the recovery remain weak.
GOLD & WHY WE ARE FACING A REAL CATASTROPHE GOING FORWARD- KING WORLD NEWS
Chairman of Leeb Capital Management, Stephen Leeb says, “Everything I’m looking at tells me to buy gold. I don’t see another way out of it." Leeb believes we will see more easing before the next Fed meeting, which will take place sometime in the next three to four weeks.
When asked about the dire situation the ECB faces, Leeb stated, “They’ve got to start buying bonds, period. It’s very simple, Spain cannot survive with bond yields over 7%. I doubt they can survive with bond yields much over 5%, when you’ve got no growth and 25% unemployment.”
Leeb continued on to say it surprised him that the ECB did not take any action. "25% unemployment is the kind of unemployment seen during the Great Depression," and makes him believe there are other things going on behind the scenes.
Gold prices end below $1,600 an ounce Thursday on news that the European Central Bank has not made any plans to initiate a fresh round of quantitative easing, stocks fell on selling pressure. Gold last traded at $1,588 an ounce, silver traded at $27.13 an ounce.
THE DEPRESSION IS HERE- IT'S JUST INVISIBLE- MARKET WATCH
It’s just that like radiation — it’s invisible.
We’ve called it the recovery, the jobless recovery, the slogging recovery and more recently the fading recovery. We’ve measured modest growth in our nation’s gross domestic product to record that our so-called Great Recession ended in June 2009. And now we are saying that if this disappointing growth suddenly disappears, as currently feared, we will be in a new recession.
The precise definition of a depression, of course, remains as debatable as anything else in the field of economics. Some definitions would say it is a long term slump in economic activity, often characterizes by high unemployment, bank crisis and other horrible symptoms.
BILL GROSS INDIRECTLY MAKES BULLISH CASE FOR GOLD- GOLD ALERT
Bill Gross, the world’s largest bond fund manager and founder of PIMCO, received a significant amount of media attention today after proclaiming that, “the cult of equity is dying.”
In his latest monthly Investment Outlook, Gross asserted that investors should considerably lower their expectations for the broader financial markets going forward. However, while Gross’ outlook for equities as a whole was quite cautious, he described an economic environment moving forward that has historically been very favorable for gold prices.
While Gross did not mention gold anywhere is his piece, he said that investors, "Should continue to expect an attempted inflationary solution in almost all developed economies over the next few years and even decades."
FOR WALL STREET, REAL PAIN WHEN THE FED FAILS TO ACT- YAHOO! FINANCE
Both the Federal Reserve and the European Central Bank this week decided to hold off on any big new initiatives to stimulate markets and the sluggish economies of the United States and Europe. The lack of action may now have a direct and painful impact on the chief source of revenue at investment banks on both sides of the Atlantic. Since the 2008 financial crisis, banks' bond trading profits have soared when the Fed and the E.C.B. have announced, and then executed, radical moves to revive economic conditions. As that stimulus wanes, that trading income drops off.
The link between Fed stimulus and Wall Street earnings became apparent soon after the financial crisis of 2008. Faced with very jittery markets and an economy that was not responding well to meeker modes of stimulus, the Fed bought $1.25 trillion of mortgage-backed bonds, mostly in 2009. In that year, Wall Street bond trading operations, which provide the bulk of profits at such firms, produced some of their strongest results ever.
Gold prices dipped near $1,600/oz. Wednesday on short-term profit-taking following the Fed's un-stimulating statement, stocks fall. Gold last traded at $1,601 an ounce, silver traded at $27.42 an ounce.
"A cautious Federal Reserve on Wednesday said the economy was weaker but stood pat on monetary policy. The lack of action was a surprise," reports Marketwatch. "Analysts had expected the Fed to push out its pledge to hold its benchmark federal funds rate exceptionally low. Instead the Fed repeated that it would likely hold that rate steady until late-2014."
CENTRAL BANKS CAN'T STOP THE WEAKNESS - MarketWatch
They can mask it any way they want, and they should try their best to protect the economy, but the central banks of the world are walking a tight rope, and any slip could spell disaster.
The U.S. can kick the can — we can also print more money — but nothing will stop the weakness from coming. My longer term macroeconomic work, “The Investment Rate”, proves that this period of natural economic weakness lasts until 2023, so they will need to print and engage QE programs coined, not only as QE3, but maybe up to QE23!
In order to stave off the problems that exist today, they will need to print for 11 more years, but even if they print, it won't make the economy strong.
LIKE OVER-HYPED OLYMPIAN, FED SET TO DISAPPOINT - Reuters
Pity the Federal Reserve. Like an over-hyped Olympian, the U.S. central bank enters this week’s policy meeting with sky-high expectations and a high probability of disappointment. Markets are salivating at the prospect of a decisive easing move when Fed policymakers emerge from their meeting on Wednesday.
”I think the Fed can structure the statement in such a way that it would reduce disappointment” by citing, for example, the recent extension of Operation Twist and saying it will act if things don’t get better, said Dana Saporta, an economist at Credit Suisse.
FEDERAL DEFICIT HIGHEST SINCE 1940s - USN&WR
The federal deficit is higher than it has been since the 1940s, in the years immediately after World War II.
A new visual from the "Face the Facts USA," a non-partisan election project from George Washington University, shows the federal deficit has risen significantly under President Barack Obama, and that the government is increasingly spending money it doesn't have.
In every second of 2011, for example, the government spent $114,253 — even though it was only taking in $73,043 in revenue. According to Face the Facts, that means the federal government spent $41,210 every second that it didn't actually have.
GOLD AT ECB: ACCIDENT OR STRATEGY? - MerkFunds
When the euro was launched, the European Central Bank (ECB) held approximately 15% of its assets in gold. That ratio has remained reasonably stable, giving rise to a variety of chatter, including suggestions that it may displace the U.S. dollar. We pursue the question on whether the ECB’s gold holdings are an accident or strategy.
From what we see, central banks have been scared into holding gold since the onset of the financial crisis. The Fed has been more aggressive than the ECB in printing money. As such, the percentage of gold in relation to total holdings has declined at the Fed in a more pronounced fashion.
It may help to keep in mind that historically inflation is the response to a deflationary shock. If market forces were left to themselves, we believe the credit bust of 2008 would have caused a major deflationary shock. It’s the reaction of policy makers that fight market forces that may lead to inflation. Bernanke as of late brushed off such pessimism. As the charts above show, however, gold has been a sensitive – and sensible I might add - indicator to the trigger-friendliness of our central bankers.