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August 19, 2011 / Hal (GT)

Go ahead, look back. That’s gold dust settling back there.

The last couple of days have been bounding when it comes to gold. Today we’ve set another new nominal high near $1,878.00 as I take a look at the graph action in the ExactPrice widget.

Of course we’ve seen a sell off once that new high was hit but we’ve yet to see a pull back to retest yesterday’s lows and since as I’m typing three minutes before the COMEX open trading closes I’m going to go out on a thick limb and say we aren’t going to see that before it does close. I would not be surprised in the least to find that gold remains strong through out the end of electronic trading.

John Embry – Silver About to Roar Through $50 All-Time High <- Given gold’s performance I would expect that coming around the bend.

Did the Fed Announce QE3? <- Just had a thought: Maybe the Fed didn’t but Gold sure enough thinks so.

Grandich on the New Gold Rush:

“I think that up until a few weeks ago the vast majority of people—particularly individuals and small to mid-sized professionals—scoffed at any thought that gold was becoming more than an “overvalued relic,” not money, blah, blah, blah. Then a lot of things happened around the world simultaneously, and people realized that neither the dollar nor the euro or any other major currency is a safe haven any longer.”

Somalia famine is ‘manmade’, says World Bank lead economist <- HT to Laura Gross. This is a serious problem and I think that we’ll see more of this in other areas in the near future.

Fengler’s statement comes on the heels of a newly released World Bank report that shows that the prices of local food staples in Somalia like maze, wheat, and sugar have soared up 240 percent since 2008.

Ed Steer’s Gold and Silver Daily has some interesting tidbits in The Wrap section:

“Silver’s net volume yesterday was just about double what it was on Wednesday…and more than double what it was late last week and early this week…as around 47,000 contracts were traded.  The open interest was only up a tiny 567 contracts…and I would guess that there was considerable short covering going on…and it’s possible that the final open interest number from the CME this morning will be more helpful.

“But it should be obvious that the internal dynamics of the Comex futures market in gold is diametrically opposite of what’s happening in the Comex futures market in silver.  This is by design…not by free-market activity.”

Mining Share Ratio To Gold Back At Pre-QE1 Levels

Central Banks’ Demand For Gold Quadrupled In 2nd Quarter <- that should be a signal to us.

Silver Stuff <- Great analysis from Dan Norcini. Good food for thought considering gold and silver relationship.

Venezuela Lawmakers Trade Insults in Gold Debate <- HT to Gold Investing News.

Gold, silver, emeralds, diamonds..Indian $22 bn temple treasure presents challenges <- Interesting story.

Gold imports into India set to cross the 1,000 tonne mark this year:

“India’s investment demand for gold jumped 78% to 108.5 tonnes, while jewellery demand rose 17% in the second quarter till July 2011 to 139.8 tonnes, while in value terms demand rose 70% in India.”

Gold still good, but silver better! – Sprott selling his gold to buy silver. <- It would seem that a lot of folk are thinking silver is heating up.

Americans Remain Tragically Underinvested In Gold And Silver <- That;s the truth.

Fannie Mae: No Hope or Change:

Austan Goolsbee, chair of Obama’s Council of Economic Advisers, points out: by subsidizing mortgage investments, the government drives capital away from other types of investments. If Obama truly wants to help the middle and working class, then he’d want capital to flow into investments that increase labor productivity, which is the ultimate source of wage growth.  Running up asset prices, like houses, does not make us wealthier in the long run.

Gold Stocks Break to New Highs Against Equities

JP Morgan’s Fractional Gold Scheme Is Working <- very interesting read.

The real reason JP Morgan recently decided to open and operate a Comex gold vault is now in full view. A close friend of mine in the NYC hedge fund community informed me today that hedge funds are now buying gold from JP Morgan, who turns around and “safekeeps” it for them for 15 basis points (that’s .15%) on the market value of the gold being stored. My friend referred to this as “allocated” gold. On the surface it looks like the smart money “gold rush” is on.

But, in the wisdom of Shakespeare via Macbeth: “nothing is but what is not.”

Bank of America Layoffs: Banks Continue Cuts as Economic Climate Darkens

Bad Checks in Greece Soar 43% as Credit Dries Up; Greek Unemployment Rate Hits Record High 16.6%; Hey I have an Idea!


Individuals who believe gold is too expensive must also believe gold will not increase over current value. As a lifelong businessman I have learned to not judge an investment on cost but on income or appreciation potential.  We must make an argument that gold increases in dollar cost because dollars are not as valuable as in the past.  It is very important to realize gold is somewhat stationary but our dollar’s buying power is declining at an alarming rate.

Want to Smack Down the Criminal Global Banking Cartel? Here’s How to Use Gold & Silver to Do It

Okay. That’s it for today.

Keep in mind that next week is options expiration on the 25th. That should mean a dip in gold and silver if the normal happenings hold out, however the last couple of times the action hasn’t been as great as I thought so we shall see. Gold is now operating more and more as the currency of choice and I don’t know if the big banks have the ability to pull it back far. Is another rate hike coming? We shall see 🙂 not that it’ll accomplish much in the long term except telegraph that the powers that be know the bull is on a run they can’t stop but only hope to slow.





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